Ronald Lauder’s Central European Media Enterprises, which has stations in six countries in the region, posted booming financials Thursday that exceeded analyst expectations.
The Prague and Nasdaq-listed broadcaster’s net profit for the year was $42.5 million, compared to $18.53 million in 2004, while fourth-quarter net profit was $34.6 million, up from $12.98 million a year earlier. CEO Michael Garin credited the fourth-quarter boost to CME’s relationships with its local affiliates.
Boom times are likely to continue in the Czech market, said Garin, with pubcaster Czech TV forced to phase out advertising by 2007, putting $40 million in ad expenditures back on the market.
What’s more, said CME prexy-chief financial officer Robert Burke, “TV Nova has effectively not raised its prices” for the past five years.
Just as its Romanian stations have shown, rates are due for a significant bump.
Unspecified cost cuts, said by industryites in Prague to include housecleaning at TV Nova, will further improve the portfolio.
CME, which launched TV Nova in the mid-’90s as the Czech Republic’s first commercial station, lost control of it to local license holder Vladimir Zelezny in 1999 but won an international suit in 2003 forcing the country to compensate CME for $353 million in lost assets.
In December 2004 CME bought back TV Nova, now the pride of its regional holdings.
About the only hiccup acknowledged in the glowing reports on terrestrial, cable and digital broadcasters was last fall’s ratings defeat to Prima TV, whose “Big Brother” reality knockoff “The Chosen” beat TV Nova’s own licensed version of the show.
CME’s Slovak station, Markiza, did still worse with its version, but Nova has bounced back with feature film imports and locally scripted comedies and dramas including “The Street,” said Garin.