March 3, 2011 / 8:00 AM / 7 years ago

UPDATE 2-ProSieben ups payout on 2011 profit growth outlook

* Q4 EBITDA 358.6 mln euros vs f‘cast 342 mln

* Sales 954.1 mln vs forecast 944 mln

* Sees 2011 sales, EBITDA growth

* To pay 1.14 euros/preferred share, 1.12/ common share

* Shares down 3 percent (Adds detail, background)

By Nicola Leske

MUNICH, March 3 (Reuters) - German commercial broadcaster ProSiebenSat.1 PSMG_p.DE set out plans to raise its dividend as it bets on growth across all its divisions to boost results this year above a strong 2010 performance.

“After having paid only the minimum dividend to preference shareholders in the last two years, we intend to resume our earnings-related dividend distribution policy,” Chief Financial Officer Axel Salzmann said in a statement on Thursday.

The Munich-based company, whose shows include the hit vampire series Moonlight and U.S. comedy-drama Desperate Housewives, aims to pay out 1.14 euros per preferred share and 1.12 euros per common share, compared with 0.02 for preferred shares and no dividend at all for the common shares for 2009.

ProSieben, which competes with Bertelsmann-owned RTL Group AUDK.LU, said it expects sales and core profit to grow this year.

Chief Executive Thomas Ebeling said while it was always difficult to tell how the important fourth quarter would develop, he expected revenue to grow in a mid-single digit percentage range in 2011.

In Germany, Europe’s biggest TV market, the first quarter would likely be affected by the late Easter holiday, a typically strong advertising period, which will be in April this year.

POTENTIAL SALE

In the fourth quarter, group earnings before interest, taxes, depreciation and amortisation (EBITDA) increased 16.7 percent to 358.6 million euros and sales rose 8.4 percent to 954.1 million, both slightly above analysts’ expectations thanks to higher TV advertising revenue.

ProSieben, which is majority-owned by private equity firms KKR [KKR.UL] and Permira [PERM.UL], is evaluating the potential sale of parts of SBS Broadcasting, which it bought in 2007 to create a pan-European rival to RTL.

It reiterated on Thursday it was still reviewing its activities in the Nordic countries as well as the Netherlands and Belgium, but said it did not expect to come to a decision until the second quarter.

ProSieben, broadcast for free mainly via cable and satellite, reaches about 78 million households in 14 European countries.

Its shares initially rose following the earnings statement but backtracked to be down 3 percent at 23.01 euros by 1257 GMT. The stock remains not far from a more than three-year high of 25.60 euros set last month.

Media companies such as ProSieben suffered through a double-digit advertising decline in 2009 but bounced back strongly in 2010.

Salzmann said the company would update its outlook regarding its leverage after it finishes a strategic review of its international assets.

ProSieben took on a load of debt to finance the acquisition of SBS broadcasting but had reduced net debt by the end of 2010 by 8.3 percent to 3.02 billion euros. It has said it aims to have a net debt to EBITDA ratio of 3 to 4 times and is now at the lower end of that range with 3.3 times. (Editing by Erica Billingham and David Holmes) ($1=.7202 Euro)

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