RTL targets operating profit of 1 billion euros in 2-3 years, banking on ad growth

By Klaus Lauer, Elizaveta Gladun and Anastasiia Kozlova

(Reuters) -European media group RTL is aiming to return to an annual operating profit of 1 billion euros ($1.08 billion) in the medium term, CEO Thomas Rabe said on Thursday, counting on the eventual economic upturn to boost ad revenue.

"We will achieve this in two to three years," Rabe said in a media call, adding the timing depended largely on developments in Germany's challenged economy, which heavily correlate with TV advertising growth.

The company, which owns major TV channels such as RTL Germany and M6 in France, also forecast higher revenue for 2025 driven by higher streaming sales and portfolio effects.

RTL, majority-owned by media group Bertelsmann, expects its revenue to rise to about 6.45 billion euros in 2025 from 6.25 billion last year. It sees adjusted operating earnings before amortisation (EBITA) of about 780 million euros, up from 721 million in 2024.

However, it sees a relatively weak start to the year, notably in the first quarter, as the seasonal intensity of Easter advertising shifts spending from March to April, Rabe said.

RTL's streaming revenue surged 42% to 403 million euros in 2024, driven by a rise in paying subscribers and higher subscription prices in Germany. Its TV business also saw dynamic growth, with RTL Plus revenue rising 23% to about 6.1 million euros.

It also saw rapid growth in advertising revenue from streaming services RTL+ and M6+ last year.

The group said it expected to get regulatory approvals and close the 1.1 billion euro sale of RTL Nederland in the second quarter of this year. 

It proposed an annual dividend of 2.50 euros per share, lower than last year's 2.75 euros per share.

RTL's shares were down 8.8% by 0900 GMT, with one analyst suggesting profit taking may have contributed to the decline.

Its parent Bertelsmann will report full-year results on March 31.

($1 = 0.9217 euros)

(Reporting by Klaus Lauer, Elizaveta Gladun and Anastasiia Kozlova; editing by Milla Nissi)