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Weak ad market slows TF1 revenue

French commercial broadcaster up 0.6% in '07

PARIS — Hit by weaker ad market growth, competition from newer channels and primetime fiction misfires, ad revenues at TF1, France’s biggest commercial broadcaster, crept up only 0.6% in 2007 to 1.7 billion euros ($2.5 billion).

The ad hike, small as it was, exceeded some analysts’ expectations: TF1 reports stronger-than-expected December sales. But it was way down on early-year forecasts of a 6% surge in advertising  and 3.7% ad growth in 2006.

Total TF1 Group revenues, which rose 4.1% to $4.1 billion, were held up by a solid year elsewhere.

Teleshopping rose 38.7% to $223 million; TF1 Video revs bucked an 11% drop in the DVD market last year, increasing 5.6% to $245.7 million; and film revenues grew 22.1% to $149.4 million, energized by theatrical B.O. for “La Vie en rose,” which took 5.2 million admissions in France.

Returns from TF1 theme channels were up 22.1% to $278 million, thanks to carriage fees from satellite, cable and Internet TV operators.

But that figure merely underscores one trend eating away at TF1’s core channel revenues.

“We expect TF1 to continue to underperform the market for TV advertising growth, not in terms of share versus other terrestrial channels, but versus DTT and cable and satellite channels,” said Sarah Simon, at Morgan Stanley.

Weak ad growth will feed through to TF1 Group’s bottom line. TF1 announces 2007 financial results Feb. 20. Analysts are already predicting pre-tax profits of as low as $383 million for 2007, which gives TF1 little cushion for comfort for the future.