The new digital media strategy of Germany’s Axel Springer publishers seems to be paying off. The firm’s brisk web business almost offset steeply declining newspaper and magazine sales in the second quarter of 2013.
Axel Springer's second-quarter net profit slumped 9 percent to 83.3 million euros ($111 million), while sales slipped 0.9 percent to 823 million euros, Germany's biggest publisher announced Wednesday.
However, sales in the company's digital media division had surged 16 percent compared with the same quarter a year ago, Springer said, contributing 322 million euros, or about one third, to the quarterly result.
Earnings before interest, tax, depreciation and amortization (Ebitda) in the digital division also rose 16 percent, coming in at 73.7 million euros.
The publisher of Europe's top-selling newspaper Bild has launched an aggressive digital media strategy, which last month included the sale of a number of its regional daily newspapers and magazines.
“I'm convinced our strategy will do more to ensure a future for quality journalism than is being done by those who now lament the end of publishing in Germany,” Springer Chief Executive Mathias Döpfner said at the time.
In the first half of 2013, Springer's traditional paper press business fell dramatically with German newspaper sales down by about 10 percent, magazine sales slumping almost 4 percent and international print media sales declining by 8 percent.
Nevertheless, Axel Springer said it expected a low single-digit increase in total revenues for 2013, assuming that the structurally declining trends of the print business did not worsen.
In terms of profits, however, the publishing house expects a small decrease in Ebitda as a result of higher digital investments and growing expenses from structural adjustments in the print business.
uhe/mz (Reuters, AFP, dpa)