The channel’s overall financial standing has improved due to the government support, as well as the sale of the “Inter”’s share.
According to the “Vedomosti”, the earnings of the Russian “Channel One” decreased by 12% over the past year, i.e. up to RUB 26.5 billion. The most money was earned by the TV channel from TV advertising, but it also dropped by 15.6%.
The “Channel One” is considered to be a leader in the Russian Federation both in terms of audience, and revenues. According to the TNS’s measurements held in localities with 100+ thousand residents, in 2015 its viewership, same as the one of many other broadcasters, declined significantly: it was watched daily only by 12.6% of viewers in the age group 14-59 years, while in 2014 that figure reached the mark of 13.6%.
This year, the profit of the “Channel One” has been declining for the first time. As pointed out by the Russian Association of Communication Agencies (RACA), the TV advertising market shrank 14%. We shall recall that the CTC Media’s revenues have also fallen significantly.
Moreover, in 2015 the channels’ expenses increased up to RUB 36.4 billion. As explained to the edition by the spokesman of the “Channel One”, there are expenses that cannot be reduced by the company. These may refer to the rights holders’ royalties for broadcasting the Olympic Games in Rio de Janeiro, the “Eurovision” and other international sports events. An important part of expenses goes to supporting news bureaus abroad. The key role in increasing expenses within this segment is also played by the leap in currency value.
The losses of the “Channel One” declined significantly due to the additional profit of RUB 92.3 million. The Russian government provided federal mass media with subsidies from the state budget. So, the “Channel One” received RUB 3.5 billion. The TV Company also sold 29% of the channel “Inter” for USD 100 million to D. Firtash and S. Levochkin. 10% of the sale value was already received by the “Channel One”, and the outstanding amount will be paid out over 5 years.
Furthermore, to settle its financial problems the TV Company had to open additional lines of credit, as it again owed to the content producers “Krasny Kvadrat” and “Az art TV”. For this reason, the debts of the “Channel One” to creditors amounted to RUB 10 billion.
