In the reporting period, consolidated revenues increased by 6.7 percent to €7,846 million (H1 2013: €7,354 million). The significant increase in revenue was 10.3 percent attributable to portfolio and other effects, while exchange rate effects had an impact of -1.2 percent. Organic growth was -2.4 percent.
RTL Group posted a decline in revenues for the first half of the year, particularly due to the weak development of advertising revenues in France and the falling revenues at Fremantle Media. Penguin Random House recorded a sharp increase in revenues thanks to the merger that took place in the second half of 2013. At Gruner + Jahr, revenues fell as a result of an increased decline in the advertising business and lower circulation revenues, while the revenues from digital businesses continued to grow. Arvato generated significant revenue growth. Growth in the Solution Groups Supply Chain Management, Financial Solutions and IT Solutions contrasted with lost revenues in the structurally declining replication business. The revenues at Be Printers continue to be affected by the structural decline of the gravure print businesses. Revenues at Corporate Investments increased slightly. The increased revenues at BMG were used up by the gradual closure of the book club and direct marketing businesses.
There were moderate changes in the geographical breakdown of revenues compared to the same period in the previous year. Revenue share in Germany fell slightly to 35.2 percent compared to 36.3 percent in the first half of 2013. The revenue share generated by businesses in France amounted to 15.2 percent, which was slightly lower than the previous year (H1 2013: 17.1 percent), while other European countries accounted for 24.5 percent (H1 2013: 24.1 percent). The share of total revenues generated in the United States rose to 18.9 percent (H1 2013: 16.4 percent), and other countries accounted for a share of 6.2 percent (H1 2013: 6.1 percent). With these, the total share of revenues represented by foreign business increased from 63.7 percent in the first half of 2013 to 64.8 percent. The ratio of the four revenue streams (products and merchandise, advertising, services, and rights and licenses) to each other changed slightly as a result of the portfolio expansions, particularly through Penguin Random House. While the revenue share from the sale of products and merchandise increased by 2.1 percentage points, the revenue share generated by advertising fell by 2.3 percentage points. The remaining composition remained largely unchanged.
Operating EBITDA and Operating EBIT
Bertelsmann achieved operating EBITDA of €1,015 million during the reporting period (H1 2013: €1,011 million). The EBITDA margin of 12.9 percent was in line with the high level of 13.7 percent in the same period last year.
RTL Group’s operating EBITDA fell, primarily as a result of the weak market situation in France and the development of Fremantle Media. Penguin Random House earnings grew as a result of the merger. However, the increase was lower than the growth in revenues as the same period last year profited from an outstanding bestseller performance. The earnings development at Gruner + Jahr was below the previous year’s figure due to lower revenues in the German and international magazine business and in the US print business, which was sold off in the reporting period. In addition, the expansion of the digital business reduced earnings. Operating EBITDA of Arvato increased as a result of the acquisitions and these more than compensated for the declining earnings in the Solution Groups Customer Relationship Management and Print Solutions. The decrease in revenues at Be Printers burdened earnings and could only be partially offset by cost-cutting measures. The positive earnings development at Corporate Investments is primarily attributable to BMG.
In the first half of 2014, operating EBIT came to €726 million (H1 2013: €768 million).
In the first half of 2014, the planned scaling back of structurally declining businesses continued. For example, the expenses associated with the exit from the German-speaking book club businesses accounted for a large part of the restructuring costs. Further restructuring costs arose from the implementation of the integration of Penguin Random House. In addition, an impairment loss at RTL Group in Hungary was recognized. The impairment resulted from a new tax on advertising revenues imposed by the Hungarian parliament.
In total, special items came to €-172 million in the reporting period, compared to €44 million in the same period last year. They consisted of impairment losses and write-ups totaling €-98 million (H1 2013: €68 million), revaluations of investments carried at fair value of €2 million (H1 2013: €108 million), net capital gains and losses of €6 million (H1 2013: €8 million), restructuring expenses and other special items totaling €-82 million (H1 2013: €-140 million).
Adjusting operating EBIT for special items totaling €-172 million (H1 2013: €44 million) resulted in EBIT of €554 million (H1 2013: €812 million).
Group Profit or Loss
The financial result was €-125 million (H1 2013: €-158 million). Tax expenses were €-178 million, compared to €-200 million in the same period last year. Earnings after taxes from discontinued operations were €3 million (H1 2013: €-35 million) and comprises follow-on effects in connection with the sale of the former Direct Group division. Group profit fell to €254 million from €419 million in the same period last year. The decline is primarily attributable to the impairment loss in the Hungarian TV business, which was included in special items, as well as the absence of the positive effects of revaluations of investments that were included in the previous year’s figure. The share of Group profit held by Bertelsmann shareholders was €121 million (H1 2013: €306 million). The non-controlling interests in the Group profit came to €133 million (H1 2013: €113 million).