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Press releases | Archive 2010

RBC posts Q3 2010 results: revenue growth restored

Business highlights:

  • RBC’s revenue up 13% in the third quarter year on year, driven mostly by the Internet segment
  • RBC holds the fourth position among Russian Internet companies in terms of its audience
  • The aggregate audience of the largest business web portal, rbc.ru, increases 40% against Q3 2009, reaching 11 million users
  • RBC Daily outstrips its competitor Vedomosti in terms of popularity in Moscow, the latest TNS Gallup survey reveals
  • RBC completes the restructuring of the group’s financial debt to creditors
  • A favorable economic situation, completed restructuring, increased demand from advertisers, a raise in ad rates, and expanding audiences all signal high revenue growth rates for 2011
  • In December 2010, the Board of Directors will adopt the company’s mid-term development strategy

Moscow, November 15, 2010 — OJSC RBC-TV Moscow published its financial results for the third quarter of 2010 today.

In Q3 2010, RBC’s consolidated revenue expanded 13% against the same period of the previous year, reaching RUB 773.2 mln. A favorable macroeconomic situation in Russia, an upturn on the Russian advertising market, and the completed debt restructuring process all worked together to drive advertisers’ activity upwards. RBC’s high audience figures coupled with the traditionally high efficiency of the company’s advertising resources also contributed to the advertising revenue growth.

“On the whole, I am pleased with RBC’s performance in the quarter under review, considering that many advertisers abstained from allocating any ad budgets to RBC’s resources in late 2009 and early 2010 because of uncertainty regarding the company’s future development. The company’s financial difficulties were completely off the table, however, once the deal with ONEXIM Group was closed and settlements with the creditors completed. As a result, we managed to turn the tide: RBC’s revenue has started going up. Although the low activity of advertisers in the first half of the year will not allow for more than a 10% rise in revenue on an annualized basis, we are confident that RBC is on track to demonstrate considerably stronger growth in 2011,” said General Director of RBC-TV Moscow German Kaplun.

RBC’s Q3 and 9M revenue in 20101

RUB ‘000,000 3Q 2010 3Q 2009 Growth (%)
Internet2 472.5 418.5 13%
Television 97.9 89.8 9%
Print Publications 202.8 178.1 14%
- Business publications 66.2 55.5 19%
- Salon Press 136.6 122.6 11%
Total 773.2 686.43 13%
RUB ‘000,000 9M 2010 9M 2010 Growth (%)
Internet 1,367.9 1,268.1 8%
Television 286.9 248.6 15%
Print Publications 586.7 609.6 -4%
- Business publications 196.2 171.7 14%
- Salon Press 390.5 437.9 -11%
Total 2,241.5 2,126.34 5%

The aggregate 9M revenue reached RUB 2,241.5 mln, up 5% from 2009, with the third quarter actually responsible for most of the growth in 2010, thanks to the completion of the company’s debt restructuring process. The negative 9M EBITDA from the company’s operating activities, without the effect of restructuring costs worth RUB 90.4 mln, shrank nearly threefold against the same period in 2009 to RUB -132 mln. Based on the results already achieved, and with the expanding Russian economy and positive trends on the advertising market, the company expects its consolidated revenue to rise by up to 10% in 2010, with the EBITDA from operating activities reaching a level close to breakeven. Next year, EBITDA will climb into positive territory. The company’s management expects most of the revenue growth to be reflected in EBITDA.

Internet

Total revenue from the Internet segment climbed 13% to RUB 472.5 mln in the third quarter 2010 against the same period in 2009. The rise in revenue was driven by increased advertisers’ demand. In the total revenue mix in the Internet segment, advertising generated 64% of the revenue, while sales of value-added services accounted for 36%.

According to TNS Gallup, the total audience of RBC’s Internet resources reached 42.7 million people as of the end of September. The number of Russian users grew 15% against the previous year, to 17.3 million people. RBC is the fourth largest player on the Russian Internet market in terms of its audience.

The total audience of the rbc.ru business web portal stood at 11 million people as of the end of the third quarter, up 40% from the third quarter of 2009. In the same quarter, the number of Russian visitors surged 58% compared to 2009 – to 6.7 million people. Rbc.ru remains Russia’s largest business portal. In order to further augment its business audiences and open up new advertising capacity, RBC has been taking measures to refine on its main resources in the segment.

The key consumer online resources and services have maintained their leading positions on the market. In line with the TNS Gallup survey, as of the end of September 2010, their aggregate audience reached 39.4 million people, with a 16% rise in the third quarter.

In mid-September 2010, the company completed the acquisition of 25% in one of the largest online flight and hotel booking systems, iGlobe.ru. The deal will facilitate further development of the company’s Internet business and help expand the client base.

RBC intends to hike up its ad rates for Internet resources by 10% starting January 1, 2011. Provided that the positive trends on the Russian Internet and the high demand from advertisers take hold, the company plans to schedule another price rise for September 2011.

Television

The channel’s consolidated 9M revenue increased 15% to RUB 286.9 mln. The rise in revenue is attributed to higher activity by the RBC TV channel’s key advertisers – car manufacturers and financial companies. In the third quarter 2010, RBC TV saw a 9% rise in revenue, to RUB 97.9 mln, from RUB 89.8 mln in the same period a year earlier.

RBC TV’s technical penetration rate equaled approximately 75 million people as of the end of the third quarter, with 15 million viewers in Russia and 4.1 million viewers in Moscow alone, according to the TNS Gallup survey.

In September 2010, RBC entered into a partnership agreement with Russia's largest satellite television operator, Tricolor TV, which will help boost the channel’s technical coverage by over 5 million viewers.

In another development, RBC also embarked on an effort to upgrade the channel’s design. In September, RBC TV completed the first stage of the update of its graphic design. Similarly, new projects have been added to the programming grid to further popularize the channel and expand its advertising opportunities.

In view of the continued favorable economic situation, RBC TV’s ad rates will be increased by 10% from January 1, 2011.

Print Publications

The revenue generated by RBC’s publishing segment increased 14% in the third quarter to RUB 202.8 mln. Business-related publications showed a growth of 19% year on year, with the RBC Daily newspaper and the RBC magazine generating a total of RUB 66.2 mln. With the titles’ advertising capacity in high demand, RBC resolved to raise ad rates for its newspaper and magazine by 10% from October 1, 2010. Salon Press’s revenue was up 11% in the third quarter 2010 to RUB 136.6 mln.

In nine months 2010, business-related print publications generated 14% more in revenue terms, while Salon Press titles followed a negative trend. This fact can be traced to the direct dependence of the revenue of interior design and construction publications on the real estate market, which had been dominated by unfavorable trends until recently, and managed to overcome them only by the second half of 2010. Following an improvement on the market, the revenue of sector-specific publications grows with a time lag of one year.

According to the latest TNS Gallup survey, from March to July 2010, RBC Daily was the second most popular business daily newspaper in Moscow following Kommersant. The publication’s average issue readership (AIR) counts 77,500 people in Moscow. Similarly, the RBC magazine is Moscow’s most popular business title, with its AIR reaching 329,500 people, as well as the second in Russia in terms of popularity, with the total readership climbing up to 1,017,200 people. RBC’s interior and design publications also managed to retain their top positions in their respective niches. As such, the AIR of Idei Vashego Doma (Ideas for Your Home) reached 1,867,800 people by the end of February, while that of Salon Interior amounted to 714,200 readers.

In December 2010, RBC’s Board of Directors will meet to discuss and approve the company’s mid-term development strategy.

Disclaimer

This press release contains certain forecasts and other forward-looking statements. Such forecasts are based on the opinion and assumptions of the company’s management and may involve risks and uncertainties. The company’s actual results and standing may differ materially from the forecasts set forth herein. For more information about some risks and other important factors that could affect the company’s future performance, review the Risk Management section of RBC’s annual report on www.rbcholding.com. RBC assumes no obligation to update the information contained herein.

  • 1 Based on management accounts under the IFRS
  • 2 The Internet segment includes media and contextual advertising as well as value-added services
  • 3 Without the effect of discontinued operations (mostly banking operations)
  • 4 Without the effect of discontinued operations (mostly banking operations)

Press and investor contacts:
Egor Timofeev
Tel: +7 (495) 363-1111
Email: pr@rbc.ru
Web: www.rbcholding.com