RTL Group had over three million paying streaming subscribers at the half-year point, a highlight in a very strong set of results for the pan-European media outfit, which is to rebrand its TV Now OTT service as RTL+ ahead of an international rollout.
RTL’s top line jumped by 13.7% to €3 billion and EBITA increased by 87% to €483 million. TV advertising revenue in the second quarter was up 65% year-on-year.
CEO Thomas Rabe said that “the time has come to reposition our core RTL brand with a new identity and a clear set of principles”, transitioning from a TV brand to a broader entertainment brand.
One of the first practical applications of that repositioning will be the the rebranding of streaming service TV Now as RTL+ in Germany in the autumn ahead of an international rollout next year.
Paying subscribers for TV Now increased 118.9% year on year to 2.029 million at the end of June. RTL said its strategic partnership with Deutsche Telekom to bundle TV Now Premium within the telco’s Magenta TV contributed significantly to the growth. Now TV has since also been added to the Sky Q offering from Sky Deutschland as TV Now Premium. As part of the agreement, Sky exclusively sub-licenses Formula One free-to-air rights to RTL Deutschland for the seasons 2021 and 2022.
Paying subscribers for Videoland, RTL’s Dutch streaming offering, grew 20.7% year on year to 1.016 million.
Speaking to analysts, Rabe said RTL’s streaming investment was “starting to pay off” and the group saw “significant upside potential” for RTL+ and Videoland by 2025.
Rabe said that RTL would focus on RTL+ in Germany and was “ramping up its investment very significantly”.
The previously announced rebranding of TV now under the RTL name has highlighted the diminishing prospects of a joint streaming offering with rival commercial broadcaster ProSiebenSat.1. Answering an analyst question, Rabe also said that “the last thing I’m going to do” is put the effort behind RTL+ “at risk” by the company combining its streaming efforts with ProSiebenSat.1’s OTT JV with Discovery Joyn, despite the rival broadcaster’s evident openness to such a move.
Rabe said that RTL planned to extend the RTL+ service to other areas such as audio and text, leveraging acquisitions such as Gruner + jahr.
At the core of Rabe’s strategy is to create ‘national media champions’. The company is focusing its acquisition efforts in Germany, where it has now agreed with Bertelsmann, its major shareholder, to acquire publisher Gruner + Jahr’s German assets and brands for €230 million. These include media brands such as Stern, Brigitte, Geo, Capital, Schöner Wohnen, Eltern and Art. Earlier RTL, agreed with JV partner The Walt Disney Company to acquire the latter’s half-share in the Super RTL channel.
Elsewhere, RTL has agreed to merge French broadcaster M6 Group with TF1, while in Netherlands it is merging its broadcast and media businesses with Talpa Network. In Belgium it is also selling its local assets to DPG Media and Groupe Rossel for €250 million.
Rabe said that RTL’s share of synergies from these transactions pointed to “significant value creation”.
The solid set of results enabled the group to raise its outlook for the year, with expected revenues rising from €6.2 billion to €6.5 billion, and adjusted EBITDA from €875 million to €1.05 billion, including streaming startup losses of €150 million.
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