French broadcaster M6 results hit by ad slump
PARIS, July 29
PARIS, July 29 (Reuters) - France's second-biggest private broadcaster, M6, saw a sharp decline in advertising revenue in the second quarter because of weak demand and the fact it did not show the soccer World Cup, unlike larger competitor TF1.
M6, which also owns channels such as W9 and 6ter, said total advertising revenue fell 5.4 percent in the quarter to 210.3 million euros ($282.24 million). This was worse than the 2 percent decline seen in the first quarter of the year, and worse than the 5 percent decrease predicted by UBS analysts.
The World Cup helped TF1, France's leading private broadcaster, to limit the damage that a weak economy wreaked on ad revenue, which declined 2.2 percent in the second quarter.
Second-quarter sales fell 0.2 percent to 322.2 million euros, M6 said in a statement on Tuesday.
The outlook for advertising in France does not seem promising as unemployment remains persistently high and growth is stagnant. Market research group Zenith Optimedia, a unit of ad agency Publicis predicts a 1 percent drop in advertising spending in France this year.
"The group remains prudent given the lack of visibility in the advertising market in the five last months of the year," said M6, which had warned after first-quarter results that its profitability would come under pressure if the ad market floundered.
M6 is cutting programming costs and overheads to cope with lower sales. Nevertheless, its core operating profit fell 13.4 percent to 112.3 million euros in the first half, pulling margins down to 17.7 percent from 20.4 percent a year earlier. (1 US dollar = 0.7451 euro) (Reporting by Gwenaelle Barzic; Writing by Leila Abboud; Editing by James Regan)