European media giant earns $493 million
Bertelsmann, Europe’s largest media conglom, owner of the continent’s biggest broadcasting group and the world’s leading book publisher, nearly tripled its net profit in the first nine months of the year.
Boosting the group’s bottom line was the sale of direct-to-consumer division Direct Group North America to Phoenix-based private investment group Najafi Cos.
Bertelsmann also sold its 50% stake in music group Sony BMG to Sony Corp. for some $900 million this year, but since it just received those proceeds last month, they are not included in the third quarter report.
For the nine months through September, Bertelsmann posted a net profit of E387 million ($493 million), up from $168 million in the same period last year. Revenue was virtually unchanged at $14.5 billion.
The group also benefited from its 90%-owned broadcasting powerhouse RTL Group, whose strong-performing German channels and hitmaking U.K. production unit FremantleMedia helped the group buck the tough economic climate.
“Bertelsmann is strategically well positioned and financially sound, which represents a competitive advantage in the current difficult market situation,” said Bertelsmann chief financial officer Thomas Rabe. He added that the group’s businesses had “good risk diversification” and “long-term orientation.”
Rabe said he expected net profit for the full year to rise significantly due to asset sales and lower tax expenses, adding that annual revenue would likely be higher compared with last year.