Red ink flow slows

CME revs up, losses lower than expected

PRAGUE — The former Eastern bloc’s biggest media conglom, Ron Lauder’s Central European Media Enterprises, saw lower-than-expected losses for the first half of 2006, while revenues rose 71% to $276.34 million.

The continuing consolidation of CME’s eight stations, which stretch from the Ukraine to the Czech Republic, brought a net loss of $9.74 million. The terrestrial web’s chief financial officer, Wallace Macmillan, called that number an improvement over the predicted $11.9 million in red ink.

He said currency fluctuations have not helped its debts, but the group expects to save about $1 million a year in rent by buying the buildings that house TV Nova in Prague. A planned $5 million in broadband development will augment its stations.

CME borrowed in order to buy out TV Nova, with that purchase completed in May 2005. Nova, along with the Ukraine’s Studio 1+1 and Romania’s Pro TV, Pro Cinema and Acasa, form “an engine for growth,” said topper Michael Garin, whose contract has been extended two years to 2010.

“Nova is performing, but we haven’t seen returns yet,” Garin said of the leading Czech terrestrial. It forms the crown jewel of CME’s holdings in the region, which reach an estimated 82 million viewers.

Network operating income was a bit shy of market expectations of $63.9 million but still hit $60.2 million — a big boost from last year’s $4.61 million.

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