Tags: Italy | Mediaset | Dividend | Loss

Italy's Mediaset Scraps Dividend after Posting Loss

Tuesday, 26 Mar 2013 08:01 PM

Mediaset SpA, the broadcaster controlled by former Italian Prime Minister Silvio Berlusconi, reported the first full-year loss in its history because of the weak Italian advertising market and impairments.

The broadcaster had a net loss of 287.1 million euros ($369 million) in 2012 compared with a profit of 225 million euros a year earlier, the Milan-based company said Tuesday in a statement. Mediaset had impairments and provisions, including on the value of sports rights, of 307.8 million euros. The company won’t pay a dividend for the first time in its history, Chief Financial Officer Marco Giordani said on a conference call.

Sales fell 12 percent to 3.72 billion euros, beating analysts’ average estimate of 3.59 billion euros, according to data compiled by Bloomberg. The company has said it plans to cut costs by 450 million euros a year within three years. Mediaset said 2012 savings reached 307.2 million euros, beating its 250 million-euro goal.

“Since the start of economic crisis Mediaset’s management has moved quickly on cost cuts,” Claudio Aspesi, an analyst at Sanford C. Bernstein, said in a phone interview. “But the problem of revenue growth remains unresolved because the traditional advertising market continues to slump and the company probably should diversify more on digital advertising.”

Asset Sales

Mediaset is selling non-core assets as its advertising revenue has fallen. It received bids for Italy’s Space Cinema chain of theaters, jointly owned with an investment company linked to Benetton Group SpA, people familiar with the matter said in February. The asset is valued at 120 million euros to 140 million euros, one of the people said.

Mediaset’s total gross Italian ad sales, including domestic unit Publitalia and Digitalia, fell 16 percent to 2.33 billion euros in 2012.

Revenue at pay-TV offering Premium were in line with a year earlier at 518 million euros.

The Italian advertising market plunged more than 16 percent in January to 271.2 million euros, while Internet ads climbed 9.3 percent to 31 million euros in the period, according to Nielsen.

Mediaset shares were unchanged at 1.55 euros at the close in Milan Tuesday.

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Mediaset SpA, the broadcaster controlled by former Italian Prime Minister Silvio Berlusconi, reported the first full-year loss in its history because of the weak Italian advertising market and impairments.
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2013-01-26
Tuesday, 26 Mar 2013 08:01 PM
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