CME to stop acquiring and focus on organic growth

Central European Media Enterprises (CME) is cutting back on acquisitions and moving its focus to organic growth in order to increase its cash flow and lower its debt burden.

CME’s senior vice president for broadcasting Petr Dvorak said the broadcaster would still consider acquisition opportunities but would be very selective. The company has been on an acquisition trail recently, buying broadcasters and internet providers in central and eastern Europe, including Bulgaria’s bTVfor US$413m (€326m) last April. It will now concentrate on growing organically in the region, Dvorak said, according to company’s website.

In July,CME, headed by Adrian Sarbu and owner of Romanian TV station Pro TV, announced the financial results for the 2nd quarter and 1st half of 2010, posting revenues of $201,7M in 2nd quarter and of $345,4M in the 1st half.

The net revenues for the 2nd quarter increased $18.8M compared to the second quarter of 2009. Operating income for the same period decreased $3.3 million to $25.5 million, while net income attributable to the shareholders of CME for the quarter increased $141.1 million to $165.2 million, which included a gain of $217.6 million on the disposal of our former Ukraine operations. Results for the second quarter of 2010 include the Media Pro Entertainment businesses acquired by CME in December 2009.

Net revenues for the six months ended June 30, 2010 increased $26.1 million to $345.4 million, compared to the first half of 2009. Operating income for the first half increased $48.8 million to $6.3 million. Net income attributable to the shareholders of CME for the first half increased $143.2 million to $122.9 million, and fully diluted income per share increased by $2.35 to $1.92.

Since it is in CME, Media Pro Entertainment generated, in the 1st quarter, net revenues of $32.42M, while, for the first half of the year, the amount was of $66.35M.