February 6, 2019 / 8:13 AM / a year ago

Broadcaster CME beats quarterly expectations, lowers debt

PRAGUE, Feb 6 (Reuters) - Central European Media Enterprises (CME) on Wednesday reported a better-than-expected rise in fourth-quarter core profit and a drop in the broadcaster’s net leverage ratio.

Operating income before depreciation and amortisation (OIBDA) rose by 23 percent in constant rates to $90.7 million, beating market estimates of $85 million.

Revenue rose 3.2 percent to $228.3 million, boosted by rising TV ad spending.

“We believe growth in TV ad revenues in 2019 will be supplemented by a higher proportion of income from other sources,” co-Chief Executive Christoph Mainusch said.

CME, which operates television stations in five central and eastern European countries, said that it repaid $312 million in debt and related payables in 2018, lowering its net leverage ratio to 3.5-times from 5.4-times at the start of 2018.

The falling leverage ratio helps cut CME’s borrowing costs, as agreed in financing deals with its majority shareholder AT&T, which became the main owner after acquiring Time Warner.

Its average cost of borrowing declined by 250 basis points to 3.5 percent in 2018, CME said.

Reporting by Robert Muller; editing by Jason Neely

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