Tue. Apr 23rd, 2019

PRISA registers strong losses due to write-downs, but a good operating result and cash generation | Economy

PRISA registers strong losses due to write-downs, but a good operating result and cash generation | Economy



HURRY, EL PAÍS publishing group, closed 2018 with losses of 269 million euros due to the reorganization of its balance sheet. However, the group had good operating results in its different business areas and a positive cash generation of 42 million euros. Ordinary net income rose 56% to 45 million euros, as reported to the National Securities Market Commission. The company has also announced that will buy 25% of Santillana from Victoria Capital and control the entire company.

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The comparable EBITDA (gross operating result, at a constant exchange rate and without the temporary effect of IFRS 15) was 298 million, representing an increase of 10.3% with respect to the previous year, as reflected in the data submitted. to the CNMV. Net debt at the end of the year stood at 929 million, compared to 1,422 million at December 2017.

The company highlights that this result is a consequence of the positive operational evolution of the Group's business as a whole, which has been even greater than the objectives provided to the market. "At this point, it should be noted that the efficiency plan has generated a saving of 48.5 million in a single year, when the forecast was 40 million in three years The positive impact on ebitda of this plan is 39.5 millions of euros, "the company underlined. In 2018, the exchange rate had a negative impact on revenues of 81 million and 19.6 million in EBITDA.

Adjustment for asset value

In the asset value review carried out at the end of the year, PRISA recorded an adjustment of 202 million euros and 76 million euros in the book value of the activated tax credits and Media Capital, respectively, adjusting them to the reasonable accounting value of said assets. This revision has negatively affected the net result (-269 million), although this movement has no effect on cash. The ordinary net result, excluding such impairments, is positive at 45 million, with an increase of 56% over the previous year.

By activity, Education shows a comparable EBITDA growth of 3.4%, with an increase in revenues of 4.8%, despite the fact that it was a year without new developments in the Spanish market and a low cycle of institutional sales in the Brazilian market. In general, Santillana shows a good evolution of the campaigns, despite the negative currency impact of the evolution of currencies in Argentina, Brazil and Mexico.

Regarding the media, PRISA Radio shows an operating improvement of 33% driven by good performance in Spain (with revenue growth of 5% and ebitda improvement of 53%) and in Latin America (with revenue growth of 5% in local currency). According to the latest report of the EGM, Cadena SER maintains the absolute leadership of the market with 4,139,000 listeners. Los40 ranks second after SER and leads the music radio market with audiences that reach 22%. In Spain, the advertising of PRISA Radio grows 5% in 2018 to reach 172 million euros.

THE COUNTRY, absolute leader

For its part, PRISA News continues to grow in its digital development, moving towards a growing and scalable digital model, with an improvement in operating performance in the fourth quarter of 30% and showing progress in its efficiency measures. Digital advertising revenues grow at a faster rate (16%) than traditional advertising revenues (-11%). "This allows us to have good prospects in the future, since digital advertising now represents 53% of the total," the group points out.

EL PAÍS maintains its position of absolute leadership in Spain, both in the analogical and in the digital field. The newspaper AS is consolidated as the benchmark sport in Latin America. Their digital revenues now account for 78% of advertising revenue. In May 2018, AS Arabia was launched, with a potential audience of more than 400 million people.

Meanwhile, Media Capital continues to lead the Portuguese market, with an increase in advertising revenue of 3% and reinforcing its programming with the purchase of Champions rights and strengthening its entertainment grid. Its EBITDA remains stable with significant growth in cash generation and a strong reduction in its debt.

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