April 23, 2018 / 7:17 AM / a month ago

Sweden's MTG says split on schedule after beating first-quarter forecasts

STOCKHOLM (Reuters) - Media group MTG (MTGb.ST) said on Monday that plans to split the company were proceeding according to plan after beating first-quarter profit expectations.

The company recently said it would split the company in two, demerging its Nordic TV business and listing it on the stock exchange.

MTG, in which investment firm Kinnevik (KINVb.ST) owns 20 percent, said investments in its content portfolio and digital products helped it grow sales and profits in the first quarter.

The firm’s operating income rose to 220 million crowns from 137 million a year ago, above a mean forecast of 209 million crowns in a Reuters poll.

Sales increased to 4.67 billion crowns with 9 percent organic growth, topping the 4.50 billion expected by analysts. Digital sales, which accounted for 35 percent of total sales, grew 88 percent.

    MTG plans to distribute all the shares in Nordic Entertainment Group, which had sales last year of about 14 billion crowns, to its shareholders, and list them on the Nasdaq Stockholm exchange, after a sale of the unit fell through in February.

    “Everything is according to plan right now,” Chief Executive Jorgen Madsen Lindemann told Reuters, adding the spin-off is still expected in the fourth quarter of this year.

    Madsen Lindemann also said he expects profitable growth this year for both Nordic Entertainment Group and for the remaining part of MTG.

    After the split, Nordic Entertainment Group will include MTG Nordic Entertainment, MTG Studios and Splay Networks, while MTG will include the firm’s e-sports business, online gaming and digital video content operations, as well as other minority holdings.

    Reporting by Helena Soderpalm; editing by Jason Neely

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