MILAN — The Mediaset broadcast empire controlled by Italian Prime Minister Silvio Berlusconi reported on Tuesday a sharp fall in profit last year, cut its dividend and warned that weakening ad revenues at the start of 2009 meant worse was to come.
Overall revenue rose 4.2% to $5.52 billion in 2008, and net profit of $596 million, although down 9.5% from $658 million the previous year, was in line with market predictions.
But early indications suggested ad revenues had fallen by 12% in January this year, and by a similar amount in February — pointing to a tough year ahead for major European broadcasters as the recession continues to bite.
In a statement the company said that by “controlling costs” it would continue in its key commitments to develop its pay TV services and make a successful switchover to digital.
“The dividend and the Ebit (earnings before interest and taxes) are slightly better than we expected. These results aren’t too bad,” analyst Alessandro Bai-Badino of Deutsche Bank told Daily Variety.
He added that the real test would be the March advertising figures, which are traditionally twice as big as those in January.
“We’ll be looking very closely to see what happens this month,” he said.