Vocento has closed the first quarter of 2022
with total operating income of 76.3 million euros, 2.6% less than in the same period of the previous year. This drop is explained by the exit from the perimeter of NET TV and Veralia Distribución, by the incorporation of Premium Leads and by the calendar effect of MadridFusión, held in 1Q22 and 2Q21. On the other hand, operating expenses without depreciation amounted to 76.3 million euros, 1.2% more than in 1Q21.
The number of digital subscribers grew to 91,000 in March (+26% year-on-year), reaching 63,000 in Regionals (ON+ and KyM) and 28,000 in ABC (ABC Premium and KyM), which reinforces the strategy of strengthening the digital area by the Group.
The sales of copies show a drop in 1Q22 of -5.6%.
Revenue from advertising sales grew by 5.8% in 1Q22 thanks to the good performance of local advertising, which represents 57% of total advertising with 18.1 million euros. For its part, national advertising continues to be affected by the uncertainty in the economic cycle and accounts for 43% of the total, with a turnover of 13.6 million euros. It should be noted that revenues from digital advertising -including e-commerce- account for 50% of Vocento's total advertising.
Local advertising grew by 20.7% with a positive behavior both in digital format (+37.4%) and offline (+15.9%). In this period, Vocento's brands registered a better evolution than the market in the Group as a whole: in offline press Vocento closes with 11% compared to 7.2% of the market, and in online advertising Vocento reaches 4% (including the Classifieds business) while the market stood at 2.1%.
The profitability of the Group and the positive net financial position define the evolution of the quarter. In this context, EBITDA stands at 0.1 million euros, despite the context of macroeconomic uncertainty and the increases in paper and energy prices. It should be noted that adjusted for the exit from the perimeter of NET TV and Veralia Distribución, excluding the accounting for severance pay (2.5 million euros in 1Q22 and the change in Madrid Fusión's calendar), it would reflect an improvement of 617,000 euros.
The operating result (EBIT) was -5.1 million euros during 1Q22, due, apart from the operating evolution, to the higher amortizations derived from the investments made in the new headquarters. Consolidated net income is positive in 1Q22 by 3.6 million euros, an improvement of 8.4 thousand euros over 1Q21 thanks to the capital gain from the sale of NET TV and Veralia Distribución.
Ordinary cash generation stands at 4.4 million euros in 1Q22, compared to 7.1 million euros in 1Q21. Adjusted for constant perimeter and severance pay (considered non-ordinary in 1Q21), the level of 1Q22 would be higher than the previous year. The positive net financial position ex IFRS 16 in 1Q22 is 4,049 thousand euros compared to -1,721 thousand euros at the end of 2021.
'Relevo', the new Vocento sports project, reflects the Group's clear commitment to digital and diversification. Aimed at three segments of the target public neglected by the current sports offer (generation Z, dissatisfied users and female audience), it has a 100% digital format and uses RRSS and audiovisual content as an information channel in itself. With a strategic plan that foresees a positive EBITDA of 4 million euros from 2027, Relevo accounts for costs in 1Q22 of 439 thousand euros.
Results by business areas
In Newspapers, operating income (includes offline and online activity) during 1Q22 amounted to 63.12 million euros, +0.2% compared to 1Q21. By divisions, the increase is 1.9% in Regional Press, 0.8% in ABC and -9.2% in Supplements and Magazines.
In the evolution of the profitability of the Regionals, the growth in advertising of 1.16 million euros compensates part of the drop in the sales margin to readers (-1.6 million euros) affected by the increase in the price of paper , the lower margin of printing and distribution and the increase in other costs, mainly indemnities.
In this context, EBITDA stands at 361,000 euros, which represents -88.5% compared to 1Q21. ABC's EBITDA is affected by personnel costs and the printing margin, which are partially offset by an increase in advertising and an improvement in the readership margin.
In Audiovisual, operating income reached 1.1 million euros in 1Q22, 85.2% less than in 1Q21. EBITDA amounts to 611,000 euros during 1Q22. It should be noted that this area is affected by the exit from the perimeter of NET TV and Veralia Distribución, an operation closed in January 2022. After the sale of NET TV, the activity in DTT is limited to the operation of some local DTT licenses, while the Content segment has been reduced to a marginal activity.
In Classifieds, operating income reached 6.6 million euros during 1Q22, which represents a growth of 10.2% compared to 1Q21, results derived from the incorporation of Premium Leads. By verticals, growth is observed in real estate, and a decrease in motor sales, affected in turn by the lack of stock of vehicles derived from the chip supply crisis. This situation has had an impact on EBITDA, which was 570,000 euros in 1Q22.
In Gastronomy and Agencies, operating income reached 6.6 million euros in 1Q22, compared to 2.9 million in 1Q21. EBITDA stands at 618,000 euros. The Gastronomy division shows an increase in both revenues (+3.6 million euros) and EBITDA (+1.3 million), which is explained by the holding of the Madrid Fusión congress, which was held in the second quarter the previous year . Regarding Agencies and Others, their activity was concentrated in the second and fourth quarters.