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Premiere goes back into black in Q3

Company posted third quarter net profit of $6.9 million

BERLIN — Digital pay platform Premiere was back in the black in the third quarter, returning to profitability on revenues of Euros 269.5 million ($345.2 million), up slightly from second quarter sales.

Company posted third quarter net profit of $6.9 million, up substantially from its $178 million second quarter loss.

Premiere said overall cost reduction was the main factor behind the financial improvement: operating costs dropped nearly 19%, or $70 million, to $303 million.

Company topper Georg Kofler said the loss of national league soccer rights to upstart rival Arena had had a limited impact on Premiere thanks to its broad range of programming.

“The wave of churn many observers expected to hit Premiere did not happen, but quite the opposite: Premiere’s business model with its comprehensive range of programming has proved to be robust.”

Company introduced a new pricing and packaging system this summer and Kofler said it’s had a positive effect on subscriber retention and acquisition.

After a decline in customers in the first three quarters, Premiere is expecting subscriber number to increase in the fourth quarter due to holiday business. Company anticipates 3.4 million subscribers by year’s end.

“The largest part of the churn caused by the loss of the Bundesliga rights is now behind us,” Kofler said. “There are clear signs that the churn trend will continue to normalize in the fourth quarter. Judging by our experience, films, documentaries and family programming, and not the Bundesliga, are the decisive factors for Christmas sales.”

Premiere is expecting full-year revenues of between $1.35 billion and $1.4 billion and gross profit (before interest, tax, depreciation and amortization) of between $50 million and $64 million.

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