The company is implementing a range of measures to reduce its ongoing costs (excluding sports rights costs) by approximately SEK 700 million, which will fully impact on the group’s reported results in 2020.
The Nordic region’s streaming company Nordic Entertainment Group has indicated that the spread of the coronavirus is having an adverse impact on the group’s performance, which will put at risk NENT Group’s previously stated ambition to deliver profitable growth for the full year 2020. This impact includes reduced sports coverage due to the postponement or cancellation of sports events, lower advertising demand levels, and the postponement of content production orders.
NENT Group is therefore now implementing a range of measures to reduce its ongoing costs (excluding sports rights costs) by approximately SEK 700 million, which will fully impact on the group’s reported results in 2020. In addition, NENT Group’s Board of Directors will not propose the previously indicated cash dividend of SEK 7.0 per share for 2019, nor any executive long-term incentive plan for 2020, to the upcoming 2020 Annual General Meeting of shareholders.
NENT Group has, in the last week, already announced temporary reductions in its Viaplay sports package prices, that it will not report media rights costs for postponed sports events in its income statement until such time as they take place, that it will not make any new payments for postponed sports rights until they resume, and that it expects to receive compensation for any sports events that are cancelled.
The new measures include but are not limited to reductions in programming and production spend, the deferral or cancellation of any non-core or non-essential development projects, lower sales and marketing spending, and the cancellation of all executive incentive plans for 2020. Following the group reorganisation in recent months in order to set the business right for the future, there is no intention to reduce permanent staffing levels, but freelance and consultant costs are being reduced and new hires are only being made for essential positions.
Moreover, all non-essential travel and entertainment has been cancelled and the group expects to make even greater use of its existing remote access, sharing and conferencing facilities for the foreseeable future. The measures being taken are intended to protect staff, business continuity and the future potential of the operations when the current crisis comes to an end.
Anders Jensen, President and CEO of NENT Group, said: “We always work to stay ahead of both opportunities and challenges, and we are doing the same now. This is an unprecedented situation that is evolving every day, but let me repeat that we remain in good shape and our operations are running with limited interruption, which is all credit to the fantastic resilience and agility of our platforms and people”.
“Our top priorities are the wellbeing of our employees and continuing to deliver the best possible value to our customers. The measures that we are now taking are all about ensuring the long-term health and potential of what drives our business - our people, our content and our technology. The viewing, listening and streaming KPIs for our entertainment services are very encouraging, as people spend more and more time with us,” he added.
We always work to stay ahead of both opportunities and challenges, and we are doing the same now” Anders Jensen President and CEO of NENT Group