ProSiebenSat.1 shareholders are gearing up for a pivotal vote at its annual general meeting (AGM) at the end of the month, as its main investor MFE-MediaForEurope seeks greater control of the German broadcaster. But after a difficult financial year for ProSieben, the company has reported a positive start to 2024, potentially strengthening its hand ahead in negotitations with MFE.
In Q1 2024, ProSieben generated €867 million in revenues, up 6 percent YoY. The results mark a return to growth in TV revenues, coming off the back of 2023 when group revenues were down 7 percent across the full year. The TV business started to show signs of recovery towards the end of last year, when the weak TV ad market was “partially offset” by digital ad revenues.
Now the group’s investment in its streaming service appears to be paying off. Joyn’s ad revenues were up 50 percent YoY, suggesting the AVOD business is beginning to contribute to the group’s growth. Joyn also posted a 36 percent YoY increase in monthly users, and continutes to receive investment as ProSieben looks to bolster its slate of exclusive local content.
The group also confirmed it is on track to meet its full-year targets, aiming to generate around €3.95 billion in 2024, representing a 2.6 percent increase on 2023. “The full-year outlook takes into account the major sport events not broadcast by ProSiebenSat.1, such as the Summer Olympics and the European Football Championships in the second and third quarter,” noted ProSieben CEO Martin Mildner.
Lining up support
An interesting result in the first quarter was the strong performance of ProSieben’s commerce ventures, Verivox and Flaconi, which the group began the process of selling last week. In March, MFE pushed for a shareholder vote on splitting off these non-TV assets, urging the group to focus on its core TV business. ProSieben pushed back against the proposal, arguing that such a move was “in the unique interest of MFE”, by clearing the path for a full takeover of the German broadcaster.
Reports suggest MFE has held talks with various banks to fund its takeover of ProSieben, as the Berlusconi-owned media group mounts a bid worth up to €4 billion. The financial endorsement could strengthen MFE’s position ahead of the AGM, when shareholders are to vote on the holding group’s proposal to split off ProSieben’s e-commerce and dating divisions. MFE is also seeking to gain two seats on the German group’s supervisory board.
And the proposal has received public support from another major shareholder, Amber Capital. The hedge fund manager holds around 1 percent of ProSieben, and did not rule out buying more shares ahead of the AGM.
But ProSieben is building up its defences, and has two shareholders in its corner. Proxy advisers ISS and Glass Lewis have backed the German management and recommended that shareholders vote against the proposals, setting up a key contest on 30th April.
