Releasing interim results for the first time, Geermany's KirchMedia has reported significant increases in sales and earnings for the six months to June 30 2001.
While revenues climbed by 15% to $1.51bn (DM 3.247bn) and its EBITDA rose by 42% to $238.9m (DM 514m), the new corporate transparency showed that the company's consolidated net debt amounted to $2.05bn (DM 4.412 bn) due to the acquisition of a 48% stake in Euvia for $162.5m (DM 350m) and a $297.2m (DM 640m) interim financing for KirchBeteiligung as part of the Formula One acquisition and new media investments.
Commenting on the results, Dieter Hahn, designated chairman of the executive board for the planned merged company of KirchMedia and ProSiebenSat.1 Media, noted that "particularly, the improvement of the margin in the rights trading business, has more than offset the downturn in advertising revenues which has affected the entire media industry this year. By focusing clearly on the German-speaking market and our core areas of operation, we have created a strong basis for further growth".
With more than 63,000 hours of programming in its entertainment library, KirchMedia's rights trading division, for example, showed a strong performance in the first half of 2001 with revenues of $430.2m (DM 926.5m) and an EBITDA of $101m (DM 217.5m), indicating that the competition which had intensified over the last two years following the arrival of new players in the rights trading sector is already beginning to recede.
In a press communique KirchMedia explained, "many of these new competitors were able to raise capital on the Neuer Markt and their bidding for programme assets resulted in higher prices, in turn affecting the profit margins in the license-trading business. KirchMedia believes that the consolidation process, which has already begun, will intensify. Thanks to its broadcasting family, film library and strong market position, KirchMedia is in an excellent position to benefit from this market consolidation".