ProSiebenSat.1 increases revenues to over EUR 4.1 billion in 2019 and drives transformation to diversified digital group Figures 2019
Full-year Group revenues grow by 3% to EUR 4,135 million
Non-TV core advertising business with double-digit revenue growth of 12%, representing 52% of Group revenues
Growth drivers: revenues up 38% in digital and smart advertising business, 18% at Red Arrow Studios and 16% in NuCom Group
Streaming platform Joyn closes 2019 with over 7 million total monthly active users and more than 6.5 million apps installed
Adjusted EBITDA of EUR 872 million (-14%) reflects investments in the future of the business recognized as expense and a challenging TV advertising market
Net income increases by 65% to EUR 412 million, adjusted net income decreases by EUR 154 million to EUR 387 million
Free cash flow before M&A improves by 39% to EUR 339 million
Executive Committee proposes dividend of EUR 0.85 per share
Outlook 2020
ProSiebenSat.1 teams up with General Atlantic to sign an agreement for the acquisition of The Meet Group Inc in order to create a leading global player in the online dating segment
ProSiebenSat.1 continues to invest additionally in local content, innovative advertising products and growth of NuCom Group in 2020
The Group aims to rise revenues to EUR 4.3 billion (+/- EUR 100 million) and to achieve adjusted EBITDA of around EUR 870 million (+EUR 30 million/-EUR 70 million); development largely dependent on total Entertainment advertising revenues and further program investments
Munich, March 5, 2020. Max Conze, CEO of ProSiebenSat.1 Media SE: The transformation of ProSiebenSat.1 into a diversified digital group is making good progress. Despite an industry in transition and a tough TV advertising market, we were able to increase our revenues by 3%. At the same time, more than half of last year's revenues came from non-TV core advertising business. We continue to advance strongly in digital and smart advertising with a 38% increase in revenues. The double-digit growth rates at Red Arrow Studios and NuCom Group also prove that we are setting the right priorities. In the TV business, our focus on local content continues to increase its impact and our digital reach keeps growing, also thanks to the strong launch of the streaming platform Joyn. Our 2019 performance demonstrates that it was the right decision to invest in future initiatives, and we will consistently continue to pursue this path: We want to grow sustainably and thus create additional value. We can be proud of what we have achieved so far, and we thank our excellent ProSiebenSat.1 team, who day in and day out translate our transformation strategy into operating business.
Development of the Group
ProSiebenSat.1 Group concluded the 2019 financial year largely in line with its expectations: Despite the demanding development in the TV advertising business, the Group increased its revenues by 3% to EUR 4,135 million (previous year: EUR 4,009 million); the organic (1) increase was 2%.
In the Entertainment segment, the Group further accelerated growth in the digital and smart advertising business with an increase of 38%, to which the Addressable TV business and the advertising-financed streaming platform Joyn were also contributing. The focus on this area of growth has already partly offset the decline of 5% in TV core advertising revenues, which reflected the weaker macroeconomic environment. Furthermore, the deconsolidations of the video-on-demand portal maxdome and the online fitness provider 7NXT also had an impact. Overall, external revenues in the Entertainment segment declined by 4% to EUR 2,518 million (previous year: EUR 2,626 million). Organically, external revenues declined by 2%.
Revenue growth in the other business units however more than offset this development. The Content Production & Global Sales segment (Red Arrow Studios) saw double-digit growth in its external revenues also in the full-year, rising clearly by 18% to EUR 652 million (previous year: EUR 552 million). Organic growth was 13%. Digital studio Studio71 generated high growth rates, with the global production and distribution business also continuing its revenue increase, especially in the USA and Germany.
NuCom Group's Commerce business also continued its growth with a plus of 16%, generating external revenues of EUR 965 million (previous year: EUR 831 million). Organic growth was 8%. While the initial consolidations of the US online matchmaking service eharmony and of Aroundhome, an online broker for products and services related to the home, had a positive impact, online beauty provider Flaconi recorded considerable organic growth.
Thanks to substantial growth in the digital and smart advertising business, at Red Arrow Studios and NuCom Group, the Group's non-TV core advertising business rose by 12% in total, thus increasing its share in ProSiebenSat.1 Group's revenues to 52% (previous year: 48%).
As expected, the Group's adjusted EBITDA decreased in the full-year and was down by 14% to EUR 872 million (previous year: EUR 1,013 million). This reflects the Group's decision to continue investing in the future of the Entertainment business and NuCom Group's growth as announced. Furthermore, lower TV core advertising revenues had an impact on adjusted EBITDA. Adjusted net income essentially reflects the development in adjusted EBITDA as well as investments in Joyn and, as expected, declined by 28% or EUR 154 million to EUR 387 million (previous year: EUR 541 million). EBITDA of the Group however rose by 47% to EUR 838 million (previous year: EUR 570 million), with net income growing by 65% to EUR 412 million (previous year: EUR 250 million). This was mainly due to lower reconciling items than in the previous year. Also, free cash flow before M&A improved by 39% to EUR 339 millio
