Mediaset sees improvement, but no movement on Vivendi

Mediaset has posted results for the first nine months that beat market estimates on advertising revenue growth. However, the company has been unable to report any progress on its legal stand-off with France’s Vivendi to date.

Mediaset posted net revenues for €2.533 billion for the nine months, down from €2.564 billion a year ago, with most of the decline coming from its Italian operation.

The group said that the year-on-year comparison was impacted by a slowdown in the advertising market in both Italy and Spain. However, gross advertising revenues in Italy grew by 0.8% for the nine months to €1.423 billion, bucking a market trend that saw the overall ad market decline by 4%.

Mediaset’s pay TV revenues have continued to slide. The company posted pay TV revenues of €441 million for the nine months, down from €457.4 million last year.

Operating costs fell by 7.7% in line with the company’s 2020 plan, helping boost EBITDA, which rose from €892.9 million last year to €957.9 million. Mediaset’s investment in Italian TV and movie rights declined year-on-year from €423.4 million to €354.7 million. In Spain, its content investment declined marginally, with TV and movie rights costs falling from €139.2 million to €131.1 million and co-production investment rising slightly from €12.6 million to €16.2 million.

Mediaset posted an operating profit of €194.7 million, up from €25.9 million in 2016.

Mediaset said that it was on target to achieve positive results both in terms of consolidated operating and net profit by the end of the financial year.

Speaking after the company posted its results, finance chief Marco Giordani told analysts that Mediaset had received no offer from Vivendi and there was nothing to report on that front. Mediaset and its controlling shareholder Fininvest have been engaged in a long-running and bitter legal battle with the French media group over the latter’s decision to pull out of an April 2016 agreement that would have seen it take control of struggling pay TV unit Mediaset Premium.

Vivendi-owned Canal+ has now created a content joint venture with Telecom Italia, in which Vivendi is the leading shareholder. Giordani said he was open to collaborating with Telecom if it became an investor in content.