Ekspress Group, one of Estonia's two major private sector media groups, has seen growth in revenue of 2 percent on year in the first quarter of 2020 (Q1 2020), the company says. However, the company still went into the red over the same period, though it says this is largely due to seasonal factors, aside from the coronavirus pandemic's effects.
Ekspress Group AS says most of its turnover growth came from digital services. The company reported a turnover of €15.7 million in Q1 2020, up 2 percent, or €400,000, on the same period in 2019.
The group's earnings before interest, depreciation and amortization (EBITDA) was €0.67 million, an increase of 9 percent on year.
However, Ekspress Group made a loss of €0.74 million in Q1 2020, 21 percent higher than the same period in 2019.
Losses caused by seasonality and pandemic
Mari-Liis Rüütsalu, board chair at Ekspress Grupp, said the start of Q1 2020 had been successful for the company, but the economic crisis caused by coronavirus pandemic thwarted this.
"Most of the first quarter was a strong period in the Baltic economies, which was also very well reflected in the strong advertising sales of media companies," Rüütsalu said via a press release.
"We continued to grow our digital revenues, and by the end of the first quarter they already accounted for 65 percent of the group's media segment sales. Losses in the first quarter is normal for the media group due to seasonality, but the rise losses was primarily influenced by higher interest expenses compared with the previous year, as well as the emergency situation established in mid-March, which led to a decrease in advertising revenues," explained Rüütsalu.
In response to the crisis, Ekspress Group says it had also already significantly reduced its entire cost base in March, and that the company's results in Q2 and Q3 2020 would continue to be negatively affected.
"We can see that the economic crisis accompanying the virus will significantly affect the operations and revenues of Ekspress Group in the second and third quarters as well.."
Q1 2020 saw the number of digital subscriptions to Ekspress Group's media publications grew strongly in all three Baltic countries, reaching a total of 54,000 subscribers, the company said. Initial orders in Latvia saw the highest growth at 61 percent, Estonia, 11 percent.
Ekspress Group started its activities over 30 years ago, and in Estonia its flagship publications are Eesti Päevaleht, a daily, and weeklies Maaleht and Eesti Ekspress.
Editor: Andrew Whyte