Berlin, Unterfoehring The television company Pro Sieben Sat 1 cancels its forecast for 2020 and the dividend because of the corona crisis. Due to the current standstill of the global economy and the resulting economic uncertainty, it is Per seven Sat 1 is currently unable to provide an outlook on the financial results in the second quarter and for the full year, the company said on Wednesday evening.
The management board had therefore decided to withdraw the financial forecast for 2020 as a whole. The television group does not want to pay a dividend for the 2019 financial year either.
The company had previously announced that it would propose a dividend of EUR 0.85 per share to the general meeting. At the same time, the Group confirmed its previous dividend policy with a payout ratio of 50 percent of the Group’s adjusted consolidated net income.
Investors appeared to be calm in view of the similar announcements from various listed companies from the recent past. In an initial reaction, the Pro Sieben Sat 1 share price only declined by a good half percent on the Tradegate trading platform.
The new CEO and CFO Rainer Beaujean said: “By mid-March we were well on track until the first Covid 19 effects began to affect our business in all segments. As the duration and full scope of the pandemic remain uncertain, it is currently not possible to provide an outlook on our full year results. ”
Sales increased slightly in the first quarter
According to preliminary figures, consolidated sales rose slightly by one percent to 926 million euros in the first three months. The previous year it had been 913 million euros. The initial restrictions in the corona crisis would have impacted the high-margin advertising business in the second half of March: advertising revenues therefore fell by four percent in the first quarter after the first cancellations of line items. The entire media industry in Germany is currently struggling with losses in the advertising business.
The group also benefited from classified business such as the online beauty provider Flaconi. However, because business grew in areas with lower margins and decreased in high-margin (advertising business), adjusted EBITDA decreased in the first quarter by 17 percent to EUR 157 million, compared to EUR 190 million in the same period of the previous year. The company reported adjusted net income at EUR 58 million (previous year: EUR 94 million).
Pro Sieben Sat 1 assumes that advertising revenues in the TV business will decrease by around 40 percent in April compared to the previous year. Shifts in production at Red Arrow Studios are also affecting business.
The group with more than 7200 employees is currently also examining whether it will introduce short-time working within the entertainment business. In the NuCom division with internet shops and platforms such as Verivox or Parship, the media group is already using short-time working in some portfolio companies.
More: Pro Sieben Sat 1 starts the big podcast offensive.