Coronavirus Halves Profits at RTL, Owner of ‘American Idol’ Producer Fremantle
European broadcasting group RTL, whose bouquet of companies include “American Idol” producer Fremantle, has seen group revenue down 16.4% to €2.7 billion ($3.3 billion) in the first half of 2020, according to half-yearly results declared on Thursday.
Adjusted earnings before interest and amortization (EBITA) fell 52% to €258 million ($305 million).
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Fremantle’s half-yearly EBITA stood at €23 million ($27.2 million), less than half of the €52 million ($61.5 million) achieved during the same period last year. Revenues dropped from €828 million ($979 million) to €707 million ($836 million). The decline was “mainly due to fewer deliveries of shows and postponements of productions as a result of the COVID-19 impact on numerous territories,” RTL said.
The overall group downturn was due to the COVID-19 outbreak across Europe in the second quarter of the year, that led to a year-on-year fall of 40% in advertising revenue. However, this fall would be down to 10% in the third quarter, the group estimates, but is unable to provide an outlook for the full year, due to ongoing uncertainties.
On a positive note, the group notes that Fremantle productions have restarted in most territories, with “significant content demand from broadcasters and streaming platforms,” and paying subscribers for the group’s streaming services in Germany and the Netherlands up 45.2% to 1.77 million.
RTL Group chief executive Thomas Rabe said: “As expected, our largest revenue stream – TV advertising – declined strongly in the second quarter of 2020, but we succeeded in offsetting 50% of the revenue decline. We did so without cutting into the substance of our businesses or reducing investments in our streaming services, which is reflected in gains in market shares and a significant growth in paying subscribers for our streaming services. This demonstrates the resilience of our businesses, and the strength of our management teams. Our broadcasters and Fremantle restarted productions across all genres to offer our viewers fresh and exclusive content.”
The commercial launch of Salto – the joint subscription streaming service of Groupe TF1, France Télévisions and Groupe M6 – is planned for autumn 2020, the results note. The results also flag Fremantle’s creative successes, including “American Idol,” “America’s Got Talent: The Champions,” “Five Guys a Week,” and “Too Hot to Handle,” and the launches of “The New Pope,” and “Baghdad Central.”
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