TVN Group hit by advertising decline

Polish broadcaster TVN Group expects the local TV advertising market to continue to decline this year after a tough 2012.

TVN Group, which is in the process of merging its pay TV subsidiary ‘n’ with former rival Cyfra Plus, saw revenue fall by 11% in the fourth quarter on the back of a weak domestic advertising market.

TVN’s reported fourth quarter and full-year revenue fell by 13% and 8% respectively. Comparable EBITDA for the fourth quarter fell by 5% to PLN178 million (€43 million), with fully-year comparable EBITDA falling 8% to PLN512 million thanks to cost savings that offset much of the negative revenue impact.

Reported EBITDA for the fourth quarter fell by 29% to PLN139 million, attributable in part to a share of the loss of NC+. The EBITDA decline was offset in part by a share of the profit of Vidalia Investments, a vehicle of Ringier Axel Springer, to which TVN sold its Onet.pl internet service in November.

“In the face of weakening advertising market TVN Group once again demonstrated its ability to adapt to difficult conditions, preserving profitability by implementing decisive actions resulting in effective cost reductions,” said CEO Markus Tellenbach. “I believe that in 2013 low visibility and fragile market conditions will lead to estimate decline of television advertising market at mid-single digit, while key objectives for the Management are to maintain market shares and profitability in the TV segment and to further develop TVN’s online business. We consistently create value for our shareholders by continuously strengthening the TVN brand and our position as the leading television broadcaster in Poland.”