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RTL Group Annual Report 2009 4 Worldreginfo - 4D680018-60Ed-4109-B77f-233894615E3c

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RTL Group Annual Report 2009 4 Worldreginfo - 4D680018-60Ed-4109-B77f-233894615E3c ANNUAL REPOrt THE LEADING EUROPEAN ENTER TAINMENT NETWORK WatCH TV WITH THIS ANNUAL REPOrt HOW TO GET StarteD: SEE page 5 01_U6_Umschlag_falz_EINZELSEITEN_ausgl.indd 108 WorldReginfo - 4d680018-60ed-4109-b77f-233894615e3c 08.04.2010 15:52:31 Uhr –15.0 % (2009: +10.6 %) INDEX = 100 RTL GROUP Share price performance 2005–2009 DJ STOXX – 2 1. 0 % (2009: +13.9 %) Market capitalisation 2005–2009 (€ billion) 09 7.3 08 6.6 07 12.5 06 13.1 05 10.5 +10.6 % Revenue 2005–2009 (€ million) Total dividend per share 2005–2009 (€) 09 5,410 09 3.50 08 5,774 08 3.50 07 5,707 07 5.00 06 5,640 06 3.00 05 5,115 05 1.05 – 6.3 % Dividend payout 2005–2009: € 2.5 billion 1 EBITA 2005–2009 (€ million) Adjusted earnings per share 2005–2009 (€) 09 755 09 2.85 08 916 08 3.87 07 898 07 3.54 06 851 06 3.52 05 758 05 2.96 –17.6 % – 26.4 % 1 Adjusted earnings per share represents the net profit for the period adjusted for 2 Equity 2005–2009 (€ million) impairment of goodwill, Shareholding structure 31 December 2009 disposal groups and amortisation of fair value adjustments on acquisitions 09 5,530 and gain or loss from sale of 08 5,871 subsidiaries, joint ventures Bertelsmann AG and other investments, 91.0% 07 6,448 net of income tax expense and one-off tax effects RTL Group 06 6,151 2 Excluding 0.76% which is 05 5,348 held collectively as treasury Public 9.0% stock by RTL Group – 5.8 % and one of its subsidiaries WorldReginfo - 4d680018-60ed-4109-b77f-233894615e3c 01_U6_Umschlag_falz_EINZELSEITEN_ausgl.indd 110 08.04.2010 18:23:17 Uhr WorldReginfo - 4d680018-60ed-4109-b77f-233894615e3c RZ_RTL_03_70.indd 3 26.03.2010 17:25:37 Uhr Winning co-operation: Sébastien won the first season of the French- Belgian adaptation of FremantleMedia’s international hit format, The X Factor, broadcast by W9 in France and RTL-TVI in Belgium RTL Group Annual Report 2009 4 WorldReginfo - 4d680018-60ed-4109-b77f-233894615e3c RZ_RTL_03_70.indd 4 26.03.2010 17:25:40 Uhr C O N T ENTS 6 Chairman’s stATEMENT 8 CHIEF EXECutive’s reporT 12 PROFIT CENTRES AT A GLANCE 14 THE YEAR IN REVIEW 48 CORPORATE RESPONSIBILITY 58 OPERATIONS 60 HOW WE WORK 62 CORPORATE GOVERNANCE 66 THE BOARD 69 EXECUTIVE COMMITTEE 71 FINANCIAL INFORMATION 72 Directors’ report 76 Mediengruppe RTL Deutschland 80 Groupe M6 82 FremantleMedia 84 RTL Nederland 86 Five Group 88 RTL Belgium 91 RTL Radio France 94 Other segments 105 Consolidated financial statements 110 Notes 168 Auditors’ report 171 Fully consolidated profit centres at a glance 173 Five-year summary HOW TO WATC WITH THH ISTV! ANNUAL REPOR T USER MANUAL RTLGroup.com/ Report2009 1 2 3 4 You need Go to RTLGroup.com/Report2009. Flip to one of Hold the whole page a computer If asked, allow the installation the pages displaying in front of the webcam with an of the Adobe Shockwave and our video logo and be ready internet of the video plug-in. (pictured above). for a surprise. connection and a webcam. RTL Group Annual Report 2009 5 WorldReginfo - 4d680018-60ed-4109-b77f-233894615e3c RZ_RTL_03_70.indd 5 26.03.2010 17:25:43 Uhr RTL Group Annual Report 2009 6 WorldReginfo - 4d680018-60ed-4109-b77f-233894615e3c RZ_RTL_03_70.indd 6 26.03.2010 17:25:47 Uhr Chairman’s statement but also to significant goodwill impairments on Five Group in the UK and Alpha Media Group in Greece. Nevertheless, RTL Group achieved a positive net result of € 205 million. The company’s sound financial position is also reflected in a significant net cash position of € 789 million at the end of 2009. The RTL Group share price finished the year up 10.6 per cent, 2009 was an extremely challenging period from €42.5 at the end of 2008 to €47 at the end of 2009, while for the European TV industry as advertising the DJ STOXX index of European media shares increased 13.9 markets across the continent declined per cent over the year. considerably. Against this background, I am pleased to confirm thatRTL Group achieved a satisfying set of results: our early focus on reducing costs resulted in significant savings, so that the EBITA margin of the Group, Throughout 2009, the management provided the company’s at 14.0 per cent, remained at a high level. stakeholders with a clear and transparent assessment of the The major achievements of recent months might be summarised situation in the TV advertising markets, analysed the resulting neatly as: “Costs down, ratings up” – we remain in good shape challenges for the TV industry and explained the Group’s two- having managed our way through the economic downturn. The fold strategic response − reducing the cost base in core TV Group's management team successfully combined comprehen- broadcasting while at the same time continuing to invest in sive cost cutting measures with maintaining the strong market growth opportunities. This included FremantleMedia’s acquisiti- positions of RTL Group’s broadcasting families and production on of the US-based production company Original Productions, companies, indeed even improving them in some of the major the launch of a new digital channel in the Netherlands and the markets. The families of channels in Germany, France, the Neth- ongoing expansion of the company’s video-on-demand plat- erlands and Belgium all achieved higher audience shares, while forms, internet activities and diversification businesses. FremantleMedia continued to produce the highest-rated shows around the globe. Return on sales at the five biggest profit Clearly the economic crisis has made 2009 a difficult year for contributors − Mediengruppe RTL Deutschland, Groupe M6, many organisations, and we have not been immune. It has FremantleMedia, RTL Nederland and RTL Belgium − remained been a very demanding year for all of us, but I have been hugely stable year on year. encouraged by the motivation of everyone throughout the RTL Group to apply their own unique talents on our behalf, and to maintain such high standards in doing so. Therefore I would like to thank everyone within our Group companies and at the Corporate Centre for their efforts during 2009. However, the decline in the advertising markets – worse than anticipated – not only led to lower Group revenue and EBITA, RTL Group Annual Report 2009 7 WorldReginfo - 4d680018-60ed-4109-b77f-233894615e3c RZ_RTL_03_70.indd 7 26.03.2010 17:25:47 Uhr RTL Group Annual Report 2009 8 WorldReginfo - 4d680018-60ed-4109-b77f-233894615e3c RZ_RTL_03_70.indd 8 26.03.2010 17:25:51 Uhr Chief Executive’s report 2009 changed the television industry. Like all commercial TV companies, RTL Group had to deal with the recession, a downfall in advertising, and structural changes through digitisation, all at the same time. RTL’s profit centres reacted quickly, cutting costs yet managing to increase audience shares. Acting early from a position of strength, RTL Group was able to prove reliability even in times of crisis. BY GERHARD ZEILER This was a crucial year for the TV industry. The economic crisis ■ Adopting the digital opportunities, RTL Group’s led to a significant advertising downturn. Most TV markets profit centres improved and extended their popular across Europe fell by double-digit figures. In addition, increasing catch-up services. Throughout Europe, our online digitisation is leading to substantial structural changes in the platforms registered more than 1 billion video streams. television industry. And digitisation leads to fragmentation, which Several new platforms were launched, which are brings more choice, for viewers as well as for advertisers. now available via the internet, TV and mobile phones. At the same time – contrary to the predictions of many sceptics – TV proved that it is, and will remain, the leading These successes are only possible due to RTL Group’s de- medium: an increase in average viewing time shows how much centralised structure, where strong CEOs in the various countries media consumers love television. In many European countries, in which we operate act like entrepreneurs, with the power to including Germany and France, people spent more time make local decisions. This structure provides the company with watching TV than in previous years, while in the UK, average a solid competitive edge. viewing time was 225 minutes per day – the highest figure since 1992. Beyond the traditional ways to watch television, internet and mobile video content are growing markets. Facing extraordinary challenges, the television industry proved that it is flexible and resilient, even in difficult situations. The Group’s profitability continued to be high in 2009: EBITA Broadcasters and producers can adapt to economic and tech- margins of the big five profit contributors – Mediengruppe RTL nological changes quicker than many other industries. Deutschland, Groupe M6, FremantleMedia, RTL Nederland and RTL Belgium – remained stable or even increased. At the beginning of 2009, in the midst of the economic un cer- Given the double-digit declines in Europe’s TV advertising tainty, RTL Group had three top priorities: markets, however, revenue and profits fell to below the previous ■ To reduce the cost base in our core business of TV year’s levels. Revenue decreased by 6.3 per cent to €5,410 broadcasting, without losing substance. million (2008: €5,774 million). ■ To further invest in content and brand extensions. With a record second half-year result of €437 million (up ■ To proceed in the transition from the linear to the digital world. 5.6 per cent year-on-year), full-year EBITA reached €755 million (down 17.6 per cent), despite higher start-up losses The results speak for themselves: (mainly resulting from the first-time full-year consolidation ■ The bottom line of the cost-cutting measures at our profit of Alpha Media Group in Greece) and significant one-time centres is significant: RTL Group managed to reduce charges, including restructuring costs in the UK, Germany its operating costs by €371 million in 2009.
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