Fremantle eyes further M&A as Q1 revenue drops 5.6%, parent RTL hit by advertising woes

Baghdad Messi

Fremantle will continue its rampant M&A activity to achieve its €3bn revenue target by 2025 according to parent RTL Group, despite the distributor-producer’s revenue falling by almost 6% in Q1.

The 72 Films and Element Pictures owner said its Q1 revenues had fallen by 5.6% to €435m ($480m), down from €461m on last year, while RTL’s group revenue dived 9% to €1.4bn.

The decline comes amid ongoing M&A activity for Fremantle, which is attempting to hit its self-imposed annual revenue target of €3bn by 2025.

The division reached €2.3bn in 2022, but has acquired a raft of companies over recent years including Normal People producer Element Pictures, UK indie Dancing Ledge (The Responder), scripted Italian production company Lux Vide (Devils, Leonardo) and Israel’s Silvio Productions.

RTL said the Q1 decline was down to “timing effects” around show delivery and added that it would not shift from its M&A activity, which recently saw the company acquiring A Team Productions in Belgium, the prodco behind Baghdad Messi.

The group said it “will invest significantly in Fremantle – both organically and via acquisitions – in all territories across drama and film, entertainment and factual shows and documentaries.”

RTL, meanwhile, saw its revenues fall 9% to €1.4bn, mirroring similar falls at other European broadcast groups such as Atresmedia in Spain and TF1 in France. Organic revenues were down 7.7%, partly because of selling assets such as its RTL Croatia operation to Central European Media Enterprises.

Advertising revenues were also particularly badly hit, with declines of 15.5% to €700m, and the group pointed to the “challenging” market in Germany as a factor.

Streaming income from RTL+ and Videoland in the Netherlands proved buoyant, however, largely thanks to increasing subscriptions, with streaming revenue up almost 16% to €74m.