TVN rides the advertising wave

TVN, the leading commercial-broadcasting station, has reported a fourth-quarter 89.5-percent surge in net profits to the tune of zł.128.1 million. Q4 revenue jumped 47 percent year-on-year to zł.405 million, spurred on by encouraging forecasts from analysts last fall. Annual earnings rose from zł.209.3 million in 2005 to zł.258.8 million while net profits reached zł.223.7 million. Full-year revenues were up 35 percent to zł.1.165 million.

The outstanding results for the station, majority-owned by Luxembourg's ITI Media Group, were attributed to vigorous growth in the television- advertising market based on a significant rise in both viewers and advertising rates. The group runs 11 TV channels that provide a mix of news and entertainment programming - both foreign and in-house productions. The group attracts 17 percent of the population as regular viewers with 80 percent of the group's income derived from the prime target audience of 16-49 year-olds.

"These are very strong results, especially if we look at revenues which are significantly higher than market expectations," said Krzysztof Kaczmarczyk, an analyst at Deutsche Bank in Warsaw.

TVN stated that it expected its 2007 revenues to rise by another 23-26 percent, "faster than the pace of the market," assured TVN president Piotr Walter. The firm's EBITDA margin is expected to rise to nearly 35 percent in 2007. The group targets capital expenditures of zł.165-175 million this year with a focus on the consolidation and expansion of its television and internet activities.

TVN shares gained about 60 percent last year. The company is valued at zł.9.3 billion. (Reuters)