Bertelsmann 07 Revs Fall 2.8 Percent; Considers Sale Of Direct Group Unit
This story was written by Joseph Weisenthal.
German media group Bertelsmann has announced full-year 2007 revenues of $29.6 billion, a 2.8 percent decrease from $30.4 billion in the previous year. Due to various charges this year, including the Napster (NSDQ: NAPS) settlement ($386.6 million), as well as gains in the previous year, net income fell sharply to $639 million, from $3.94 billion. Some division results:
-- Revenues at the BMG divisionbased on its 50 percent stake in SonyBMGfell 27 percent to $2.36 billion. This was partly the result of the sale of the company's publishing unit. However the core business, not surprisingly, was weak, as a 40 percent increase in digital sales failed to offset a 17 percent decline in physical media.
-- Revenues at the Direct Group, which operates book and music clubs, fell 4.1 percent to $4.1 billion. The decline was attributed to weak demand for physical media, as well as the slumping US dollar. CEO Hartmut Ostrowski said the company is exploring strategic possibilities, including a possible sale, for this unit.
-- Media and communications services provider Arvato grew revenues 2.8 percent to $7.7 billion. The unit benefited from an increased trend towards outsourcing and the acquisition of locations from Deutsche Telekom (NYSE: DT) and France's SFR.
-- The RTL Group, the company's radio, TV and TV production unit, grew revenues 1.2 percent to $8.9 billion. This takes into account the sale of its French pay TV channel TPS.
-- Random House revenue decreased 5.6 percent to $2.84 billion, in part due to the slide of the US Dollar.
By Joseph Weisenthal