Co. posted first-ever operating profit in 3Q
BERLIN — German pay TV platform Premiere continued to narrow its losses in the third quarter, with its net deficit down 70% to E25.4 million ($29.57 million), the company reported Monday.
Third-quarter revs were up 14% to $275 million, boosting Premiere’s nine-month revenue 22% to $823 million. However, losses for the first nine months were up $121 million, due partly to restructuring costs and writedowns on hidden assets once valued at $1.3 billion.
Company, which last week inked an output deal with Sony Pictures Television Intl., posted its first-ever operating profit (before tax, interest and writedowns) of $18.8 million in the third quarter, but writedowns of $32.6 million from devalued assets left the company with the net loss.
Premiere, formerly part of the now-defunct Kirch Group, was forced to revalue assets following its takeover in April by European investment firm Permira. As a result, it is now facing a $1.3 billion writeoff over 10 years. Company is thus writing off some $30 million per quarter, which will continue to dent its bottom line over the next decade.
Putting a positive spin on the results, Premiere topper Georg Kofler described the $30 million writeoff as “a balance sheet formality that has nothing to do with the operational business.”
Kofler added that the third-quarter figures had beaten expectations. The number of subscribers rose 13% to 2.76 million in the first nine months of the year and Premiere is expecting business to heat up during the Christmas season, which has traditionally seen a boost in subscriptions.