April 29, 2020 / 4:04 PM / a month ago

French TV group TF1 sees big lockdown hit as advertising revenues slump

(Reuters) - French TV group TF1 (TFFP.PA) on Wednesday said it expected a big impact on its second quarter across all activities from the extended coronavirus lockdown as well as difficulties adjusting costs over the longer term.

The media group, which has stakes across the broadcasting, advertising, internet and publishing sectors, said the crisis had cost the company about 35-40 million euros in advertising revenue over the last two weeks of March, reflecting a gradual increase in cancellations.

TF1, which owns the country’s leading commercial channel, reported first-quarter group advertising revenues down 9.7% on the previous year, from a consolidated revenue of 493.9 million euros, down 10.8%.

“The situation in the second quarter is not good,” TF1’s executive vice-president for Finance and Procurement, Philippe Denery, said in a call.

“About a third of employees are in partial employment over April and the start of May. When the lockdown eases, this will go down a bit,” he added.

TF1’s audience share among its advertising targets remained around 30% in the first quarter, as the start of the year featured the return of popular entertainment brands like The Voice and Koh-Lanta.

Meanwhile, French broadcaster M6 (MMTP.PA) reported on Tuesday first-quarter TV advertising revenue down 8.5% as the market plummeted in March, with advertisers cancelling campaigns as lockdowns hit consumer spending.

The TV firm, which had planned to air this year’s European Championship soccer tournament alongside TF1, also said it expected a significant fall in advertising revenues over the second quarter of 2020.

TF1 withdrew its initial 2020 targets at the end of March, namely a double-digit current operating margin, and a cost of programmes of 985 million euros ($1.1 billion).

Reporting by Sarah Morland in Gdansk; Editing by Hugh Lawson and Ed Osmond

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