BBC Worldwide’s disappointing numbers

chris

BBC Worldwide has just turned in record revenue numbers – at least for the BBC. But Disney or Time Warner it quite definitely isn’t.

Overall sales at the BBC’s commercial arm were up 13% to £916.3m, but profits for the BBC’s Worldwide Channels were DOWN £20.9m on last year’s efforts to just £12.6m in the year to March.

In its Annual Report, BBC Worldwide recorded strong growth in the EMEA region, especially in its UKTV joint-venture (with Virgin Media), and perfectly decent numbers at BBC America helped by shows like Top Gear and the overseas sales of its Dancing with the Stars/Strictly Come Dancing format.

In a statement, the BBC blamed the drop in profits on the cost of investing in new channels, and BBC Worldwide boss John Smith said tough trading might further impact profits for this current year.


Which is all well and good. But jump back a few years to Rupert Gavin’s time as head of BBC Worldwide, when he was able to report seven straight years of record profits and cash flow (cash flow into the BBC at £141m in the 2003-4 year, up 14%), helped by “spectacular” sales of that year’s flavour of the month The Weakest Link. In 2002 alone BBC Worldwide pulled in £660 million (then worth $1.1 billion) of which some £106 million (then $173.7 million) was returned to the BBC for investment in programming. That figure was double what it was five years earlier, and Gavin in a 2002 interview said he was aiming for doubling revenues again “in the next five years”, ie 2007-8.


So, in the 2002 year that Rupert Gavin supervised there were overall sales of £660m. This past year under John Smith, far from “doubling” sales, as Gavin predicted, overall sales are £916.3m. Good, but a long way short of doubling. In fact, assuming a five per cent increase year-on-year (just to keep pace with inflation) Rupert Gavin’s 2002 figure of £660m grows to £884.5m. So Smith and his team’s £916m have done little better than inflation.

Still, those now supervising the BBC seem content. Etienne de Villiers, non-executive Chairman, BBC Worldwide, said: "BBC Worldwide is on track to achieve its five-year growth plan and return a substantial stream of additional funding to its parent, the BBC, for the long term. The company is firing on all cylinders and well placed to deal with the challenges ahead."

Mark Thompson, DG/BBC, commented: "Today's figures from BBC Worldwide once again demonstrate its importance to the Corporation. It generates profits and dividends that the BBC can reinvest in making outstanding programmes and developing online applications for the benefit of all licence fee payers.”

It therefore seems the BBC, via Worldwide, will continue to invest in non-related projects and assets like the recent Lonely Planet guide book publishing operation, and thus take management time and cash away from the business of TV.

Licence fee payers take note.


Source: RapidTVNews

__________________