BBC Worldwide Registers double-digit profit growth

BBC Worldwide Ltd, the commercial arm and wholly owned subsidiary of the British Broadcasting Corporation (BBC), has published its Annual Review for 2007-08. Operating profits rose 17% to £117.7m (2006/07: £100.6m) in the 12 months to 31st March 2008, on sales up 13% to £916.3m (2006/07: £810.4m).

Announcing the results, John Smith, Chief Executive, BBC Worldwide, said that the proportion of sales from outside the UK had increased from 46% to 49% of the total. Significant profit growth was delivered by BBC Worldwide’s Sales & Distribution, Home Entertainment and Content & Production businesses, with Magazines putting on circulation in a challenging market.

Good progress was made in increasing BBC Worldwide’s presence in Australia, India and the USA, which have been identified as top priority markets.During the financial year, BBC Worldwide also made significant long-term investments in its digital and global brands strategies, launching – an advertising-funded internet platform for web-users outside the UK – building the Top Gear brand and acquiring a majority stake in Lonely Planet, the renowned travel information publisher.

“BBC Worldwide has achieved another year of double-digit profit growth*, while also making significant strategic investments in new businesses to prepare the company for the digital media world.The continued international appeal of our content and formats, coupled with high demand for home entertainment and the strengthening in key markets of our channels and production operations, has enabled the company to report very good results ,” John Smith, Chief Executive, said .

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, Director-General of the 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.

“Increasingly I believe partnerships, like those we have with Virgin Media, or as in the proposed joint venture Kangaroo, will be critical in delivering future success for BBC Worldwide.”

In terms of the trading outlook, John Smith indicated that profits for the current financial year could be affected by the changing global economic conditions and that the company plans further significant investments in new businesses, such as Kangaroo, the commercial media player currently being developed jointly with ITV and Channel 4, which is subject to approvals.

He also announced a strategic review to improve the performance of the Children’s business and the closure of Audiocall, the telephone services business where payments to charities were wrongly withheld last year.

“These two issues aside, I remain confident that the company as a whole is in very good shape, and that the investments we have made across our key growth businesses will deliver new, sustainable, growing profits for the BBC,” said Mr Smith.

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