Axel Springer lifts fore­cast as dig­i­tal me­dia pays off

Kuwait Times - - BUSINESS - FRANKFURT AM MAIN:

Ger­man me­dia gi­ant Axel Springer re­ported grow­ing rev­enues and net profit yes­ter­day, lift­ing its full-year fore­cast as more cus­tomers turned to its paid-for of­fer­ings in print, tele­vi­sion and on­line. Ad­justed net profit in­creased 13 per­cent to 91.5 mil­lion eu­ros ($108.2 mil­lion) between April and June, mainly driven by strong growth in earn­ings from its dig­i­tal me­dia prod­ucts.

Op­er­at­ing or un­der­ly­ing prof­its in­creased 15.7 per­cent to 170.1 mil­lion eu­ros, on the back of rev­enues up 7.1 per­cent at 858.8 mil­lion eu­ros, both beat­ing an­a­lysts’ fore­casts. “We’re happy with th­ese re­sults that have beaten our ex­pec­ta­tions. Our in­vest­ments, es­pe­cially in on­line me­dia, have paid off,” chief ex­ec­u­tive Matthias Doepfner said at a press con­fer­ence.

Dig­i­tal me­dia now ac­count for around 74 per­cent of the group’s op­er­at­ing profit, he added. Axel Springer’s sta­ble of on­line ti­tles in­cludes English-lan­guage site Business Insider as well as the dig­i­tal ver­sions of Ger­man news­pa­pers like Bild or Die Welt, while it also op­er­ates a slew of Euro­pean clas­si­fied advertising sites. Doepfner pointed to an “in­ter­na­tional im­prove­ment in the on­line advertising sec­tor, es­pe­cially af­fil­i­a­tion,” when high-traf­fic sites re­ceive a cut of sales from on­line shops they link to.

The group also re­ported growth in its paid-for on­line me­dia that off­set fall­ing rev­enue from its print prod­ucts. Nev­er­the­less, print en­joyed strong sales in the first half, es­pe­cially thanks to a one-off special edi­tion of Bild cel­e­brat­ing the Ger­man par­lia­ment’s June vote to le­gal­ize same-sex mar­riages that sold 41 mil­lion copies. Look­ing to the full year, Springer ex­pects a “high sin­gle-digit per­cent­age” in­crease in op­er­at­ing prof­its and ad­justed prof­its per share com­pared with 2016’s re­sult, on the back of a “mid-sin­gle-digit per­cent­age” in­crease in rev­enues.

Founded shortly af­ter World War II by jour­nal­ist Axel Springer, the pub­lish­ing group was an early con­vert to dig­i­tal me­dia, set­ting up on­line sub­scrip­tions for its news­pa­pers, sell­ing off print pub­li­ca­tions and in­vest­ing in up-and-com­ing sites like Business Insider.

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