Media company Viaplay Group reported revenues in line with expectations during the third quarter. Operating loss increased. nThe one-time loss amounted to approximately 700 million kronerno.
Trading value increased by 14.2%, reaching 4,536 million Swedish krona (3,972). The result can be compared to the Bloomberg analyst consensus of 4479. Organic sales growth was 7 percent (25.4), mainly driven by Viaplay which increased by 17 percent and represents 52 percent of the group’s net sales.
“Viaplay’s sales growth shows good ARPU development in almost all markets,” says CEO Jørgen Madsen Lindemann.
Operating profit was -538 million SEK (-100).
Operating profit before associates and comparability items was -321 million SEK (-171), the forecast was -373.
The result after tax was -693 million SEK (-86).
Earnings per share ended at -8.85 SEK (-1.10).
The report notes that non-core operations in the Baltics, Poland and Great Britain continued to perform worse than expected.
“The path to profitability for these operations is neither clear nor realistic, which is why we have now entered into an agreement to sell our British operations, an agreement that requires regulatory approval. We have also decided to leave the Baltics and Poland in the summer of 2025,” says Jørgen Madsen Lindemann.
As a result of Viaplay’s exit from these markets, this means that it will not be able to commence planned commercial initiatives. This in turn means that one expects higher losses for the full year than previously guided.
The negative cash flow impacts of leaving these loss-generating markets are estimated at approximately SEK 2.2 billion in the coming years.
The general picture of the group is as follows:
“We continue to be impacted by higher costs of prior commitments related to original content, swelling sports rights costs and unfavorable currency impacts. Our full-year 2023 outlook is unchanged with respect to our sales but we now expect negative growth.” “The operating result before associates and items affecting comparability is approximately SEK 1.15 billion as a result of the weak result in our non-core international operations,” says Jørgen Madsen Lindemann.
The outlook for the core business in 2024 is unchanged.
It is worth noting that Viaplay exceeded the deadline to release the report by midnight on Friday, December 1. The report was first published early Friday morning in connection with the announcement of a wide-ranging recapitalization plan. This includes a capital acquisition worth four billion kroner, a debt renegotiation package worth 14.6 billion kroner, and a series of operational improvements.
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