BBC Worldwide £155m profit driven by international exports

GLOBAL – JULY 18, 2012: In spite of the challenging financial climate, quality media products still matter. BBC Worldwide saw this as a key strategy which led to an increase in their 2011/12 headline profit to £155 million, a 8% rise compared with last year’s £144 million. 

The company’s profit before tax of £104 million is up 13%, from £92 million excluding gains on disposals, on a like for like basis. In the 12 months to March 31, headline sales grew by 5% to £1,085 million, compared with the £1,030 million last year.  
The figures were revealed on July 16 by BBC Worldwide chief executive John Smith, saying: “This was another powerful performance from BBC Worldwide. By offering world-class British programming and brands that resonate with global audiences, we were able to lift headline sales beyond a billion pounds for a fourth year in succession and deliver impressive results.”
This year, however, BBC Worldwide parted company with BBC Magazines, which continues to publish its high quality titles through Immediate Media Company, Smith added.
Alongside the sale of the magazines business, which is up for a consideration of £121 million, the strong operating performance has helped lift the overall return to the BBC by 19% to a record £216 million compared with last year’s £182 million, which takes returns to the BBC since 2004 to over £1.3 billion.  Total investment in programs for distribution this year has risen from last year’s £93 million to £99 million, a 6% increase, supporting both the BBC and the wider creative economy.
BBC Advertising
Playing a key role in the success of the company, BBC Advertising, which sells advertising and sponsorship solutions on behalf of BBC Worldwide’s commercial portfolio, has almost doubled its revenue over the past four years. Figures showed that advertising revenue grew in double-digits for BBC Worldwide’s Channels network, by 41%, and, by 20%, year-on-year.
This is BBC Advertising’s best year yet, BBC Advertising executive vice-president and general manager Chris Dobson said. “The breadth of clients we now represent, the varied multi platform opportunities we offer and the delivery of quality branded content makes BBC Advertising a unique and desirable multi-audience global partner for advertisers,” Dobson added.
High quality British content
The rise in sales mark another successful year in taking great British content to the world that has benefited the UK’s creative exports. And as the business continues to sharpen its focus on international markets, international sales have increased by nine percentage points to 64%, compared with 2010/11’s 56%.
The top selling brands this year were all BBC commissions: Top Gear, Doctor Who, Frozen Planet, Torchwood, Spooks, Sherlock, Planet Earth and Natural World, each of which sold in over 100 markets. 
Great content is not only limited to the traditional channels as digital sales increased to 13% of net sales from 8% last year, mainly driven by very strong growth in sales to subscription video-on-demand providers. Its games business released 11 games in the year, resulting in 3.5 million downloads, while the TV programs have been downloaded over 31 million times around the world to date. There has also been a considerable growth in BBC Worldwide apps and its fans on Facebook: 25 million apps have been downloaded to date and fans of the company’s global brands grew to over 23 million. In addition, the company successfully launched a pilot of the Global BBC iPlayer in 16 markets across Western Europe, Canada, and Australia. 
Smith said: “We are proud of the record financial contribution we made to the BBC in addition to our role in championing UK shows, brands and talent around the world. These results have enabled BBC Worldwide to return £216m to the BBC, supporting development of world-class, original content in the context of a tighter license fee. BBC Worldwide also distributed programs and formats produced by more than 200 UK independent producers in the year.  I am proud of the unique role we play in helping our sectors of the UK creative industries to expand through exports.”
According to BBC Worldwide chairman and director-general Mark Thompson, in the last eight years, the company’s revenue has almost doubled, headline profits have grown four-fold, and over £1.3bn has been returned to the BBC – delivering a record £215.7 million return to the BBC in the year.
Key strategic objectives
BBC Worldwide’s performance can be attributed to five key strategic objectives: drive digital growth, become more international, grow the scale of the TV channels, increase investment in content, and develop more direct connections with consumers. 
What sets BBC Worldwide apart from other companies, whose focus rests largely on expanding their reach, is their core mission to invest in quality content. According to Thompson, the company invested £99 million in distribution rights for great content throughout the year and focused on delivering “high-quality distinctive programming to audiences around the world”.
 “BBC IP is the cornerstone of our content strategy and forms the vast amount of investments we make. However given the needs of the different markets we serve, we also commission and invest in bespoke local programming and some of the best UK productions from other broadcasters,” he added. 
But developing great content is ineffective without developing more direct connections with consumers. Realizing this, BBC Worldwide made it their key to strategy and success. In fact, the company’s top five brands – Top Gear, Doctor Who, Lonely Planet, Dancing with the Stars (the international version of Strictly Come Dancing) and BBC Earth – account for 30% of company headline sales and around 47% of sales now come from 12 brands, Thompson said. 
In addition, the company’s live events have grown significantly over the last year, with 1.5 million tickets sold to BBC Worldwide across 10 countries. “…and our ambition is for this to double again within the next year,” he said. 
Because of this, BBC Worldwide has become a trusted brand among consumers that could lead the company to even greater success in the future.

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