Full year report January-December 2021
33% growth to over 4m Viaplay subscribers with Nordic and international expansion well on track
Fourth quarter highlights
- Viaplay paying subscribers up 33% YoY to 4,005k (3,020) with 397k subscribers added QoQ
- 12% organic sales growth with reported sales of SEK 3,553m (3,182)
- Operating income before associated company income (ACI) and items affecting comparability (IAC) of SEK 121m (426) including SEK -219m impact of Viaplay International expansion
- Total reported operating income of SEK 69m (117) including ACI of SEK -51m (-35) and IAC of 0 (-275)
- Net income from continuing operations of SEK 32m (-4)
- Adjusted net income from continuing operations of SEK 189m (432) and adjusted EPS of SEK 2.43 (6.41)
- Net income from total operations of SEK 32m (-633), and EPS of SEK 0.41 (-9.40)
- In line with previous statements, Board to propose to AGM that 2021 profits be carried forward into 2022 for planned investment into the ongoing international expansion with no dividend to be paid for 2021
| Financial overview | ||||||
| Full | Full | |||||
| Q4 | Q4 | year | year | |||
| (SEKm) | 2021 | 2020 | 2021 | 2020 | ||
| Continuing operations | ||||||
| Net sales | 3,553 | 3,182 | 12,661 | 12,003 | ||
| Organic growth | 12.4% | 6.1% | 16.7% | 0.1% | ||
| Operating income before ACI and IAC | 121 | 426 | 607 | 978 | ||
| Associated company income (ACI) | -51 | -35 | 40 | 100 | ||
| Operating income before IAC | 69 | 392 | 647 | 1,077 | ||
| Items affecting comparability (IAC)1) | 0 | -275 | -74 | 2,109 | ||
| Operating income | 69 | 117 | 573 | 3,186 | ||
| Net income, continuing operations | 32 | -4 | 365 | 2,869 | ||
| Net income, discontinued operations2) | - | -629 | -40 | -643 | ||
| Net income, total operations | 32 | -633 | 325 | 2,226 | ||
| Basic earnings per share (SEK) | 0.41 | -9.40 | 4.23 | 33.06 | ||
| Adjusted net income from continuing operations3) | 189 | 432 | 864 | 957 | ||
| Adjusted earnings per share from continuing operations (SEK)3) | 2.43 | 6.41 | 11.26 | 14.21 | ||
President & CEO’s comments
“We ended the year by surpassing the milestone of 4m paying Viaplay subscribers, having added almost 1m new subscribers during the year, and almost 400k in Q4 alone. The total addressable market for Viaplay increased dramatically in 2021 as we doubled the number of markets that we are in. We met and exceeded both our Nordic and international subscriber targets, and have had a particularly strong start in Poland. Q4 was also our fourth consecutive quarter of double digit organic sales growth, with group organic sales up 17% for the full year and Viaplay sales up 22%. 2022 has started well and we expect the Viaplay subscriber and revenue growth to accelerate further this year as planned, as we add very attractive new content and sports rights, and launch Viaplay in the Netherlands and the UK.”
Our 12% YoY group organic revenue growth in Q4 was primarily driven by Viaplay, which is our largest revenue generating unit and grew by 21%. Our Nordic Viaplay revenues (34% of sales) were up 16% YoY on an organic basis after 15% YoY subscriber growth. We added 163k Nordic subscribers in Q4 and 438k YoY. The revenue growth also reflected the price adjustments introduced earlier in the year.
The Viaplay international operations added 234k subscribers in Q4 and 547k YoY, with the revenue levels reflecting the relatively early stage of development in the Polish market in particular.
Viaplay customers streamed a total of 13.4bn minutes of content as viewing of our 152 seasons of originals continued to grow, and our coverage of the Bundesliga, English Premier League, UEFA competitions, Formula One and Winter sports all attracted large scale audiences. We are now again raising our ambition to more than 70 Viaplay originals to be premiered in 2022. We have secured the major sports rights for many years to come, and therefore have full visibility on our cost base moving forward.
We launched Viaplay in the US in December through a partnership with Comcast, and now have our strongest ever content line-up for the launch in the Netherlands on 1 March. This features a number of the most popular sports rights, as well as local agreements with leading distributors and a global exclusive partnership with newly crowned F1 world champion Max Verstappen. Our target for 2022 is to grow the total Viaplay subscriber base by over 60% to approximately 6.5 million.
Other subscription revenues (32% of sales) were up 13% YoY on an organic basis, and reflected rising prices for the enhanced content offerings and new agreements with distributors.
Advertising revenues (32% of sales) were up 3% YoY on an organic basis, as advertising spending continued to recover and led to high sold-out ratios.
External sales for the Viaplay Studios production businesses (2% of sales) were up 25% YoY on an organic basis due to higher production volumes.
The profitability of our Nordic operations exceeded our previous outlook, and included the planned reinvestment of the 2020 savings back into the business. We added key new sports rights and continued to scale up our original content. The total EBIT before associates included the previously flagged investments into the international expansion of Viaplay, which were in line with expectations. All of these investments will drive our long-term growth, profitability and cashflow.
16% full year organic sales growth and 31% like for like profit growth for our Nordic operations demonstrate the health and potential of the business. We expect approximately 20% Nordic revenue growth in 2022 with rising Nordic profits. The international expansion will add to this growth and enable approximately 28% group revenue growth, while the investments in this growth will reduce group profits in 2022 before group profits rise again significantly in 2023.
Our joint venture Allente has now taken its planned integration costs in 2021 and is on track to deliver the SEK 650m of full run-rate cost synergies in 2022, as well as continuing to upsell Viaplay to the rest of its subscriber base. We expect significant earnings and cash flow contributions moving forward.
We will soon launch our new 5-year sustainability strategy, roadmap and targets, with the focus on producing and delivering content sustainably and becoming the most diverse and inclusive entertainment company. The pandemic has not only accelerated and broadened the adoption of streaming and the hunger for diverse content, but also highlighted how relevant our values-based and purpose-led culture is. 2022 is a very exciting year for Viaplay and NENT Group, and one in which we will take major steps towards our 2025 targets.
Anders Jensen
President & CEO
Shareholder information
2022 Annual General Meeting
The 2022 Annual General Meeting of NENT shareholders will be held on Wednesday 18 May 2022 in Stockholm. Shareholders wishing to have matters considered at the meeting should submit their proposals in writing to agm@nentgroup.com or to the Company Secretary, Nordic Entertainment Group AB, BOX 17104, 104 62 Stockholm, Sweden, at least seven weeks before the meeting in order that such proposals may be included in the notices to the meeting. Further details of when and how to register will be published in advance of the meeting. In line with previous statements, the Board of Directors will propose to the Annual General Meeting that no annual cash dividend be paid for 2021 and that the 2021 profits be carried forward into 2022 for the planned investment into the ongoing international expansion.
Financial calendar 2022
| Publication of 2021 Annual Financial & Sustainability report | Week commencing 4 April |
| Publication of Q1 interim report | 26 April |
| Annual General Meeting | 18 May |
| Publication of Q2 interim report | 21 July |
| Publication of Q3 interim report | 25 October |
Webcast and video message from the CEO
A teleconference and webcast will be held at 09.00 Stockholm local time, 08.00 London local time and 03.00 New York local time. The webcast will be streamed via the following link: https://edge.media-server.com/mmc/p/8zvudqxx
To participate in the conference call, please dial:
Sweden: +46 (0) 8 50 69 21 80
UK: +44 (0) 2071 928000
US: +1 63 15 10 74 95
The access code for the call is 2753138.
Click here to see the video message from the CEO
Contact us
press@nentgroup.com (or Roberta Alenius, Head of Corporate Communications: +46 70 270 72 17)
investors@nentgroup.com (or Matthew Hooper, Chief Corporate Affairs Officer: +44 7768 440 414)
Notes to editors
Nordic Entertainment Group AB (publ) (NENT Group)'s Viaplay streaming service is available in Sweden, Denmark, Norway, Finland, Iceland, Estonia, Latvia, Lithuania, Poland and the US. Viaplay will launch in the Netherlands and the UK in 2022, followed by Canada, Germany, Austria and Switzerland by the end of 2023. We operate streaming services, TV channels, radio stations and production companies, and our purpose is to tell stories, touch lives and expand worlds. Headquartered in Stockholm with a global perspective, NENT Group is listed on Nasdaq Stockholm (`NENT B'). This information is information that Nordic Entertainment Group AB (publ) (NENT Group) is obliged to make public pursuant to the EU Market Abuse Regulation and the Swedish Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 07:30 CET on 8 February 2022.
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