The advertising blow that HLN owner DPG Media suffered at the beginning of last year seems to have been forgotten. The company is benefiting from the urge to digitize.
The advertising market collapsed during the first lockdown in March and April ‘just like the plummeting stock markets’, says Christian Van Thillo, executive chairman at DPG Media since the beginning of last year (mainly known in our country from HLN and VTM), looking back at the annual results. from the company. ‘We were then hit by 50 percent in the TV and radio advertisements.’ But the final report has more or less erased the traces of that crash. “Everything got better from June.”
Although DPG Media did not escape advertisers who kept their finger on the purse. Advertising revenue declined by 13 percent on a comparable basis in 2020. DPG Media’s performance is therefore in line with the rest of the market. Rival Mediahuis cited declines of 10 to 20 percent ‘depending on the brand and the market’. Telenet’s TV subsidiary SBS saw its advertising and other sales shrink by 14 percent. The total turnover of the French-speaking media group RTL Belgium was hit by 14 percent.
Advertising report
Yet that does not mar the total advertising report of DPG Media. From April, the takeover of the Dutch branch of Sanoma, which includes women’s magazines such as Libelle, but also the immensely popular news site Nu.nl, started to count. As a result, the advertising hit is ultimately lower: -5 percent. The biggest pain point in the advertising market, according to Van Thillo, are the sectors that still have to keep their doors closed. ‘Sectors such as tourism or the event and culture sector are very important to us, especially in the Netherlands.’
DPG Media
> Active in three countries: Belgium (VTM, Het Laatste Nieuws, De Morgen …), the Netherlands (AD, de Volkskrant …) and Denmark (Berlingske and BT).
> Top management: CEO Erik Roddenhof and Executive Chairman Christian Van Thillo.
> Turnover: 1.766 billion euros in 2020 (+ 8%). Of this, 820 million comes from the readers’ market, 471 million from the advertising market, 130 million from online services and the remainder from activities such as printing, distribution, mobile telephony …
> Gross operating profit (EBITDA): 339 million euros (+ 31%).
> Net profit: 178 million euros (+ 38%).
Despite the light advertising label, DPG Media continues to grow steadily. The company’s total turnover lands 8 percent higher at 1.77 billion euros. Partly through the Sanoma takeover. Other growth engines have also made their mark in the past year, thanks to the rapid digitization of our society. As with other media groups, DPG Media saw readers, viewers and listeners, greedily for news, flow online and was able to market this by selling more digital subscriptions. That put the total income from the readers’ market at 820 million euros (+ 2%).
Growth engine
Another growth engine are the online services that the company has slowly developed in recent years as a third leg in addition to revenues from the readers and advertising markets. These are service platforms such as Independer, which sells insurance, or the tech review site Tweakers. Both surfed smoothly on the digitization of our society during the lockdowns. Independer placed an intermediate sprint, especially in the autumn, during the Dutch ‘care season’. ‘The cabinet then communicates what changes to health insurance, which has traditionally caused many people to change insurers’, says Van Thillo.
This pushed Independer, which took over DPG Media in October 2018 for more than 150 million euros, to an annual turnover of 71 million euros (+ 13%). It is the appropriate ‘life insurance’ for the group. To date, this has mainly been the case in the home market of the Netherlands, but the platform must also gain a foothold in Belgium. Independer already started selling car policies here. Although it is still too early to see far-reaching results there. ‘The platform has yet to develop here. You have to get the big players in the market on board. They still watch very hard over their network of brokers. ‘
Homework
The credo is to sow to reap later. Sometimes this leads to surprises. This was also the case with another ‘double-digit’ grower of the past year: the tech review site Tweakers. DPG Media took over VNU Media, the company above Tweakers, in 2012, but did so mainly with a view to the company’s recruitment activities. Tweakers was one of the brands that it acquired. That resulted in a nice windfall last year. Due to the high amount of homework, people were looking for information about second screens or other office equipment for the home. The site’s turnover grew by a fifth.
DPG Media is also pulling its strings lower on the income statement. On a turnover of 1.766 billion euros, the company achieved a gross operating profit of 339 million euros, or a margin of 19.2 percent. In the country mix, the Netherlands is doing slightly better than Belgium, with a margin of 19.2 percent compared to 18.7 percent here. With a margin of 9.3 percent, Denmark remains the ugly duckling. DPG Media is focusing on the market on the fact that the news site BT.dk became the market leader for the first time in mid-2020.