Axel Springer profits plunge as it looks to refocus on classifieds business
German media group Axel Springer has posted a sharp drop in first-quarter profits, as strong trading in its online classifieds business failed to offset a decline in news media.
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The figures
Net profit dropped by 35 per cent to €55.4m (£47.4m) in the first quarter.
Group revenues slipped marginally to €771.8m.
Adjusted earnings before interest, tax, depreciation and amortisation fell 6.9 per cent to €113.4m.
Why it’s interesting
The decline in first-quarter profits comes as the German media giant looks to focus on long-term future growth from its classifieds and media divisions.
The firm, which owns news brands including Die Welt, Bild and Business Insider, said it will strengthen its news business in a bid to increase the company’s value in the long term.
Growth was driven largely by the company’s classifieds media division, which saw an 8.5 per cent increase in revenues to €214.8m.
But this failed to offset a 2.9 per cent drop in revenues from Axel Springer’s news media business.
The Berlin-based company reiterated its expectations for full-year earnings, but cut its forecast for revenues due to the sale of its majority stake in holiday rental company @Leisure.
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What Axel Springer said
“The first-quarter results show that digital classifieds and digital journalism are delivering significant growth for Axel Springer,” said chief executive Dr Mathias Doepfner.
“We will invest more heavily in the potential of growth companies in these areas in the future compared to previous years.”