rtlgroupsa-2023-12-31-en

Directors’ report

Financial year 2023 in review

In December 2023, RTL Group announced the envisaged sale of RTL Nederland to DPG Media, and therefore presents its full-year results for

2023 without RTL Nederland (IFRS 5, discontinued operations). As RTL Nederland was included in the Group’s outlook for 2023, selected pro-

forma figures including RTL Nederland are provided below:

Pro-forma figures (including RTL Nederland) 1

– With a strong second half of the year, RTL Group’s results came in in line with the guidance for the full year 2023: On a pro-forma basis,

Group revenue of €6,854 million and Adjusted EBITA of €927 million, the latter including streaming start-up losses of €179 million.

– In H2/2023, RTL Group generated an Adjusted EBITA of €677 million on a pro-forma basis, up 16.3 per cent on H2/2022 (€582 million) and

the second highest ever – despite challenging advertising markets and significant streaming start-up losses.

Reported figures (continuing operations, without RTL Nederland) 2

– Group revenue was down 5.4 per cent to €6,234 million (2022: €6,589 million), mainly due to significantly lower TV advertising revenue

from broadcasting businesses and lower Fremantle revenue. Group revenue was down 4.1 per cent organically 3 compared to 2022.

– TV advertising revenue across the Group was down 8.2 per cent year on year, despite market share gains, particularly in Germany.

– Streaming revenue 4 was up 72.6 per cent to €283 million (2022: €164 million), thanks to the rapidly growing number of paying subscribers,

higher revenue per subscriber and the first-time inclusion of 6play in France.

– Distribution revenue 5 was stable at €331 million (2022: €332 million).

– Adjusted EBITA 6 declined to €782 million (2022: €922 million), mainly due to lower profit contributions from RTL Deutschland as the

German TV advertising market decreased significantly in 2023. The Adjusted EBITA includes streaming start-up losses of €176 million

(2022: €222 million). The Adjusted EBITA margin6 was 12.5 per cent (2022: 14.0 per cent).

– Group profit from continuing operations was €483 million (2022: €642 million). Group profit from discontinued operations was

€115 million (2022: €124 million). Total Group profit was €598 million (2022: €766 million).

– Total net cash from operating activities was €537 million, thereof €77 million from discontinued operations. The operating cash

conversion rate 7 for continuing operations was 68 per cent (2022: 49 per cent). RTL Group had net debt 8 of €-291 million at the end of

2023 (end of 2022: net cash of €180 million).

– For RTL Group’s Annual General Meeting on 24 April 2024, RTL Group’s Board of Directors has proposed a dividend of €2.75 per share for

2023. The ex-dividend date of the dividend payment would be 25 April 2024 and the payment date 29 April 2024.

– Based on the average share price in 2023 (€38.44 9), the proposed dividend of €2.75 per share represents a dividend yield of 7.2 per cent.


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1 The pro-forma figures for the financial year 2023 include RTL Nederland. RTL Group’s outlook for the full-year 2023, as communicated on 8 November 2023, is based on these pro-forma accounts

2 Due to the reached agreement to sell RTL Nederland, as communicated on 15 December 2023, the operating segment RTL Nederland is classified as held for sale and presented as a discontinued

operation in the consolidated financial statements 2023 (Application of IFRS 5 ‘Non-current assets held for sale and discontinued operations’ to the operating segment RTL Nederland). The figures

of the consolidated income statement and the consolidated cash flow statement for the year 2022 are restated in accordance with IFRS 5 to report the discontinued operations separately from

continuing operations. If not indicated otherwise, all figures presented/reported in this document refer to continuing operations. The sale of RTL Nederland is subject to regulatory approvals and the

consultation process with the respective works councils

3 Adjusted for portfolio changes and at constant exchange rates. Further details can be found in Key performance indicators on page 19 of RTL Group’s Full-year results 2023 report

4 Streaming revenue includes SVOD, TVOD, in-stream and distribution revenue from RTL+ in Germany, 6play in France and RTL+ in Hungary (including RTL+/RTL+ Active/RTL+ Light)

5 Revenue generated across all distribution platforms (cable, satellite, internet TV) including re-transmission fees

6 See Key performance indicators on pages 19 to 23 of RTL Group’s Full-year results 2023 report

7 Operating cash conversion rate reflects the level of operating profits converted into cash. Further details can be found in Key performance indicators on page 21 of RTL Group’s Full-year results

2023 report

8 Net cash/(debt) excludes current and non-current lease liabilities. Including these, net debt as of 31 December 2023 was €-592 million (31 December 2022: net debt of €-205 million). See Key

performance indicators on page 22 of RTL Group’s Full-year results 2023 report

9 Frankfurt Stock Exchange

Financial review 10


	2023	2022	Per cent
	€m	€m	change

Revenue	6,234	6,589	(5.4)
Adjusted EBITA	782	922	(15.2)
Adjusted EBITA margin (in %)	12.5	14.0

Adjusted EBITA	782	922	(15.2)
Significant special items	(125)	(42)
Impairment and reversals of investments accounted for using the equity method	–	(5)
Impairment of goodwill and amortisation and impairment of fair value adjustments on acquisitions of subsidiaries	(43)	(46)
Impairment and reversals on other financial assets at amortised cost	(2)	(30)
Gain/(loss) from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree	40	107
Fair value measurement of investments and re-measurement of earn-out arrangements	(32)	(78)

EBIT	620	828	(25.1)
Financial result	(13)	(56)
Income tax expense	(124)	(130)

Group profit from continuing operations	483	642
Group profit from discontinued operations	115	124
Total Group profit	598	766	(21.9)

Attributable to:
RTL Group shareholders	467	673	(30.6)
– Continuing operations	352	549	(35.9)
– Discontinued operations	115	124	(7.3)
Non-controlling interests	131	93	+40.9
– Continuing operations	131	93	+40.9
– Discontinued operations	–	–

Basic and diluted EPS (in €)	3.02	4.35	(30.6)
– Continuing operations	2.27	3.55	(35.9)
– Discontinued operations	0.74	0.80	(7.3)


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10 The figures from the previous year have been adjusted due to discontinued operations (see note 1.30 to the consolidated financial statements)

Corporate profile

About RTL Group

RTL Group is a leading entertainment company across broadcast, streaming, content and digital, with interests in 60 television channels,

seven streaming services and 36 radio stations.

The Group’s families of TV channels are either number one or number two in six European countries, while RTL Group owns, or has interests in,

radio stations in France, Germany, the Netherlands, Spain and Luxembourg. RTL Deutschland is the Group’s largest business unit and

Germany’s first cross-media champion, operating across TV, streaming, radio and digital publishing. RTL Group’s streaming services include

RTL+ in Germany and Hungary, Videoland in the Netherlands and 6play in France.

Fremantle is one of the world’s largest creators, producers and distributors of scripted and unscripted content, and is responsible for more

than 11,000 hours of programming per year, alongside an international network of teams operating in 27 countries. The streaming tech

company, Bedrock, and the ad-tech company, Smartclip, are also owned by RTL Group.

As a market leader, RTL Group strives to foster alliances and partnerships within the European media industry – for example, by building one-

stop advertising sales houses in Germany with Ad Alliance, and driving international advertising sales with RTL AdAlliance.

The roots of the company date back to 1924, when Radio Luxembourg first went on air. Compagnie Luxembourgeoise de Radiodiffusion (CLR)

was founded in 1931. As a European pioneer, the company broadcast a unique programme in several languages using the same wavelength.

RTL Group itself was created in spring 2000, following the merger of Luxembourg-based CLT-UFA and the British content production

company Pearson TV, owned by Pearson Plc. CLT-UFA was created in 1997 when the shareholders of UFA (Bertelsmann) and the historic

Compagnie Luxembourgeoise de Télédiffusion – CLT (Audiofina) merged their TV, radio and production businesses.

Bertelsmann has been the majority shareholder of RTL Group since July 2001. RTL Group’s shares (ISIN: LU0061462528) are publicly traded

on the regulated market (Prime Standard) of the Frankfurt and Luxembourg Stock Exchanges. RTL Group is listed in the MDAX stock index.

RTL Group publishes its consolidated financial statements in accordance with IFRS as adopted by the European Union.

RTL Group corporate structure (simplified)

as at 31 December 2023

1 Fully consolidated. RTL Nederland is classified as held for sale and presented as a discontinued operation in the consolidated financial statements 2023 (Application of IFRS 5 'Non-current assets

held for sale and discontinued operations’ to the operating segment RTL Nederland)

2 Net of treasury shares and own shares held by Métropole Télévision SA under liquidity contract

3 Investment accounted for using the equity method

4 Net of treasury shares


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Management approach

The Group’s business units are run by management teams with entrepreneurial freedom and editorial independence. This enables each unit to

act flexibly in its market, to build its own local identity, and to benefit from one of the most important success factors in the media business:

proximity to its audience.

Responsibility for the day-to-day management of the company rests with the Chief Executive Officer (CEO), who – on a regular basis and

upon request of the Board – informs the Board of Directors about the status and development of the company. The Executive Committee is

comprised of the CEO, the Deputy CEO & Chief Operating Officer (COO) and the Chief Financial Officer (CFO). The Executive Committee is

vested with internal management authority.

In the Operations Management Committee (OMC), the Executive Committee meets with CEOs of the Group’s units to share information,

discuss opportunities and challenges, and foster cooperation.

RTL Group has strengthened cross-border collaboration in the areas of streaming technology (led by Bedrock); advertising technology (led

by Smartclip); international advertising sales (led by RTL AdAlliance); tech & data; content creation, sourcing and distribution.

In addition, all units benefit from sharing information, knowledge and experience across the Group through the Group’s Synergy Committees

(SyCos). These SyCos – which are comprised of executives and experts from each segment and from the Group’s Corporate Centre – meet

regularly to discuss topics such as programming, advertising sales, streaming and tech and data. While each unit makes its own decisions, it

is encouraged to draw on the understanding and expertise of other RTL Group companies.

The Corporate Centre provides strategic direction and financial controls as well as a number of service functions in areas such as financial

systems and processes, while managing the Group’s portfolio of holdings.

Business model

RTL Group’s business model is to produce, aggregate, distribute and monetise the most attractive video content, across all formats and

platforms.

Broadcast

RTL Group’s broadcasters buy, produce and commission mostly local content. They also buy or license broadcasting rights for films, TV series

and sporting events. TV channels and radio stations, meanwhile, create and schedule programming that helps them shape their channel

brands. Rather than focusing on a single genre, RTL Group’s flagship channels create a general interest programming mix across all genres,

including drama, factual entertainment, news, talk, soaps, reality and sport. In today’s fragmented marketplace with a huge number of

available linear TV channels, streaming services and other social video platforms, it’s crucial for broadcasters to offer content that makes

them stand out.

Since advertising is the primary source of revenue for RTL Group’s broadcasters, they offer their advertising clients a range of ad formats –

from the traditional 30-second commercial to tailored packages of TV and digital ads to addressable TV advertising. RTL Group’s advertising

sales houses sell spots in the channels’ linear and non-linear programming and also increasingly across several media categories such as TV,

radio/audio, print and online display (cross-media). The price advertisers pay generally depends on the reach and demographic structure of


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the audience they target. Higher audience shares and more sought-after target groups lead to higher spot prices, generally priced at CPM

(cost per mille).

RTL Group broadcasters distribute their content via all platforms, such as cable, satellite, terrestrial broadcasting and internet TV. In

exchange for the broadcasting signal in high definition (HDTV) or additional services – such as the RTL Group broadcasters’ pay-TV channels

or streaming services – the broadcasters receive fees from platform operators. RTL Group reports this figure separately as distribution

revenue. Between 2012 and 2023, this high-margin revenue rose from €175 million to €331 million.

Streaming

In order to make their programmes available on all devices at all times, RTL Group’s broadcasters have established their own streaming

services, which are financed by subscription fees, advertising and distribution. These broadcasters continue to increase their production

volume of original content for their streaming services and have further developed their direct-to-consumer business models to attract new

users, retain users and increase engagement.

RTL Group’s streaming services have all opted for hybrid business models. For example, 6play in France has added a paid tier for users who

wish to have a premium experience with early content access and comfortable features such as download to go and HD quality. Tiers are

built differently across streaming services to fit the business objectives and user experience envisioned by each broadcaster. Features

include, for example, several parallel streams on various devices, the live signal of RTL TV channels in HD quality, and premium content

bundles that offer local programmes from the Group’s linear TV channels, plus premium content either exclusively produced or licensed from

third parties. In 2022, RTL Deutschland launched an innovative offer with cross-media content that was bundled in one all-inclusive

entertainment app in 2023. In addition to video content, RTL+ Max users have access to more than 90 million songs, more than 100 radio

streams, podcasts and a growing selection of audiobooks and digital magazines.

RTL_GB_2023_Streaming_value_chain (003).jpg

Advertising technology

While linear television remains the key medium to reach mass audiences daily, digital video advertising allows advertisers to deliver message

to an engaged audience, which can be enhanced using technology and data. This is done using a sophisticated method that automates the

advertising sales process: within milliseconds, an ad space on a website or streaming service can be sold to advertisers looking for a

particular demographic and willing to pay a price within a given range.

In brief, advertising technology fulfils two main goals: a) to find the best possible match between advertiser and user and, b) to find the best

achievable price for both advertiser and publisher. The main difference to traditional advertising sales is the targeting of individual users

instead of a broad reach. Addressable TV advertising aims to combine the advantages of traditional TV advertising – such as high reach and

brand safety – with the targeting solutions of digital advertising.

Content

RTL Group’s broadcasters produce and commission a wide variety of local content, while the Group’s global production arm, Fremantle, is

responsible for more than 11,000 hours of programming per year.


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1 Pre-production only starts once the idea is sold to a commissioning client network

As one of the world’s largest creators, producers and distributors of content, Fremantle operates differently to RTL Group’s broadcasters. The

company produces, licenses and distributes a vast array of programmes that range from high-end drama and documentaries through to

game shows, daily dramas and reality TV formats. As a production company, Fremantle provides broadcasters and streaming services with

content that they can use to build their businesses. Fremantle has an international network of teams across production and distribution,

operating in 27 countries.

Fremantle’s international distribution business sells finished programmes and formats around the world, while acquiring, developing,

financing and co-producing new titles for the international market. Its catalogue contains a diverse range of programming across all major

genres. Supported by a sales network that spans eleven international offices across five continents, Fremantle distributes content in over 180

territories worldwide.

The distribution business also plays an important role in providing financing for high-quality drama series and documentaries and is then able

to sell these formats internationally to help to refinance the production costs, thereby making the productions more profitable.

The business model of drama series, films and documentaries is based on creating long-term library value. Ideally, these series will entertain

viewers and thereby generate revenue and profits for five to 20 years. The development cycle of high-end drama series – from concept to

screening – ranges from two to three years.

The time of delivery of a finished programme and the date of initial transmission are determined by the broadcaster or streaming service. This

affects the timing of revenue recognition at Group level. These phasing or timing effects can swing significantly from one quarter to another,

but are often balanced over the course of the year.

Other

Radio/Audio

Alongside the flagship radio station RTL in France, RTL Group owns or has interests in other stations in France, Germany, Spain and

Luxembourg − reaching millions of listeners every day. RTL Group’s radio stations create and schedule programming to shape their channel

brands. In France, the Group’s flagship channel balances a mix of genres such as news, talk and comedy to create a general interest

programming mix, whereas smaller channels such as Fun Radio focus only on music and younger listeners.

In the case of France, Germany and Luxembourg, RTL Group operates TV broadcasting and radio broadcasting in the same market. This

creates significant synergies, ranging from cost to programme and cross-promotion – for example with joint advertising sales houses. Next

to traditional advertising-financed radio broadcasting (which has a similar business model to linear free-TV as detailed on page 6), RTL

Group is active in the production of podcasts – for example with Audio Alliance in Germany.

Publishing

RTL Group’s German publishing business includes established magazine brands such as Stern, Brigitte and Geo, as well as digital products in

all publishing segments. The business model is comparable to radio and TV: the publisher collects, produces and distributes local content and

RTL Deutschland’s advertising sales house Ad Alliance sells print and online advertising. The main sources of revenue are advertising and

distribution, which is divided into subscription and retail sales.

RTL Deutschland’s publishing business has been undergoing a digital transformation. The shift from print to digital marks a change in

consumer behaviour amplified by a challenging market environment. This is mainly due to increased prices for paper and energy, increasing

inflation and supply chain issues and significantly decreasing print advertising revenue. The restructuring of the business, which was

completed in 2023, is accompanied by an investment of €80 million by 2025 in the Group’s publishing business, €30 million thereof in the

expansion of the digital paid offer Stern+.


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Market

Market environment

Digitisation has significantly transformed the TV market. More than 99 per cent of European households now receive their TV signal digitally

and, in Germany alone, viewers have access to more than 80 linear television channels.

Digitisation has brought new ways of reaching viewers – including short-form video content made for consumption on mobile devices and

streaming services – which complement conventional modes of TV distribution such as terrestrial television, cable and satellite (free-to-air

and pay-TV). RTL Group and other broadcasters have welcomed the opportunity to distribute their programmes on both a linear (scheduled)

and non-linear (on demand – anywhere, any time and on any device) basis.

With these extensive changes in the technical infrastructure of content distribution, the rise in viewing consumption through new devices

(connected TVs, mobile devices and game consoles) has led to far-reaching changes in TV viewing behaviour. Now that media convergence

has become a technical reality, the media industry has experienced noticeable shifts in audience reach, advertising and distribution.

The video market comprises:

– Linear TV (commercial free-to-air channels, pay-TV channels, public broadcasters and linear TV channels delivered ‘over-the-top’)

– Streaming services financed by subscriptions, advertising, distribution revenue or pay-per-view (especially long-form)

– YouTube, Facebook/Instagram, TikTok, Twitch and other online video platforms (especially short-form)

Market trends

Due to ongoing digitisation, RTL Group’s markets are currently shaped by two key trends: competition and consolidation.

While linear TV is still the way most viewers consume video content, non-linear viewing or streaming is growing fast. The following trends can

be observed:

– The younger the target group, the higher the share of non-linear viewing

– The younger the target group, the higher the share of viewing on mobile devices

– Linear viewing time in young target groups has decreased over the past decade

– Younger target groups spend more of their entertainment time on more social and interactive forms of entertainment, including video

games and social experiences

– Streaming services are now also increasingly attracting older target groups

– Watching video content on mobile devices increases the demand for short-form video (short clips that last just a few minutes)

– There is a high demand for high-end drama series, films and documentaries on streaming platforms

– Films are increasingly produced for streaming services and broadcasters, while cinemas decrease in relevance

Competition

Traditional media companies, particularly in the United States, spend enormous amounts in the battle with global tech platforms such as

Netflix, Amazon and YouTube (Google). In what became known as the 'streaming wars’, in a short space of time, Disney, Apple, Warner Bros.

Discovery, Paramount Global (formerly ViacomCBS) and Comcast/NBCUniversal all launched new streaming services. Subscriptions for

libraries of films and shows, along with other services, cost up to €18 a month in Germany, for example. In addition to the subscription fees,

streaming services such as Netflix, Disney+ and Amazon Prime introduced ad-supported price tiers to their services. Amazon complemented

its Amazon Prime service with a purely advertising-financed offer, Freevee, which is available for free in major markets such as the United

States, the United Kingdom and Germany. Streaming services also offer an increasing number of free ad-supported streaming TV (FAST)

channels. In contrast to ad-supported video-on-demand (AVOD), FAST channels offer live TV – like a linear TV channel via CTV devices.

Although this increases competition, it also offers opportunities for content production companies such as Fremantle.

As a result, the production business around the world was thriving in the years 2018 to 2022, especially for high-end drama series, causing

rapidly increasing prices for the best content and talent:

– According to data from research firm Ampere Analysis, the global production market represented $243 billion in 2022 – twice as much as

10 years ago. However, this trend is expected to slow down, according to an Ampere Analysis report published in January 2023. Despite

macroeconomic headwinds, budget cuts of streaming companies, a challenging TV advertising environment, which especially burdened

free-to-air broadcasters, and industry challenges from the writers’ strike in the US, the market is estimated to be stable in 2023, with a total

value of $245 billion.

– Content production prices increased rapidly over the past years. According to FT.com Citadel on Amazon Prime was the most expensive

series of 2023, with production costs of $50 million per episode. The first season of the Lord of the Rings series for Amazon Prime, which

launched in 2022, is still the most expensive series ever, costing $58 million per episode.

– However, streaming services worldwide have faced slower growth in paying subscribers, driven by the high number of available services

and increased customer churn. The focus of streaming players has shifted towards profitability, with cost-saving measures and tighter

control on content spend. For example, content commissioning has partly moved from expensive scripted series to less expensive


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unscripted content, such as entertainment and reality shows. In addition, several subscription-based streaming services further

strengthened their activities to increase revenue from advertising.

– Since the peak of the streaming wars in 2022, major US studios and content rights holders – such as Disney, Paramount Global and Warner

Bros. Discovery – have again started to license films and shows to competitors, international broadcasters and streaming services. This

move partly reverses their strategy to withhold such content for exclusive use on their own direct-to-consumer streaming services. Global

streaming services – which previously asked for worldwide exclusive rights from production companies – have also become more flexible

in their content acquisition strategy. Both developments offer opportunities for RTL Group’s broadcasters and streamers, as well as for the

Group’s global content business, Fremantle.

The developments in the field of artificial intelligence (AI) have accelerated significantly. Tools and applications based on AI are being

adopted by consumers and institutions alike. For TV, streaming and content production, generative AI poses both risks and opportunities.

While copyright considerations in this context are unchartered territory, the applications have the potential to drive efficiency gains in areas

such as advertising planning, video and advertising production, and post-production (for example., subtitling and dubbing). For further

examples on AI at RTL Group see Innovation on page 40.

Consolidation

In the past 10 years, some media groups have been folded into vertically integrated conglomerates that control both the production and

distribution of content. For example, Comcast bought US media company NBCUniversal and the European pay-TV provider Sky.

The world’s largest media company, Disney, expanded horizontally, with its $71 billion acquisition of 21st Century Fox in 2019 and previous

acquisitions of Pixar (animation studio), Lucasfilm (Star Wars) and Marvel Entertainment (Marvel Comics). US telecommunications company

AT&T bought DirecTV, a satellite firm, and Time Warner, owner of HBO and Warner Bros. Studio. AT&T split off WarnerMedia and combined it

with Discovery in April 2022 – now called Warner Bros. Discovery. US media companies CBS Corporation and Viacom formed ViacomCBS

(called Paramount Global since February 2022). This period of consolidation has created a handful of content companies with huge back

catalogues.

In Europe, larger consolidation moves initiated by RTL Group, such as the planned mergers between Groupe TF1 and Groupe M6 in France and

Talpa Network and RTL Nederland in the Netherlands, were blocked by the competition authorities. In both countries, the competition

authorities did not take into account the speed and extent of the changes in the European media landscape and the impact of these changes

on local media companies.

As outlined in Deloitte’s TMT predictions for 2024, the streaming model will shift from subscriber growth to profitability. Streamers are

expected to consolidate, firstly commercially and secondly via M&A. With this so-called ‘commercial consolidation’, streamers are expected

to offer bundles that combine several streaming or other media services at a lower combined price and with longer subscription periods, for

example six months or a year-long subscription. This bundling is also possible in collaboration with telecommunication companies, such as

the hard bundling of Deutsche Telekom’s Magenta TV and RTL+ in Germany.

The production business, although much more fragmented than broadcasting and streaming, shows a similar consolidation trend, as demand

for talent – including authors, scriptwriters and showrunners – increases. Thus, large production businesses merge with, or increasingly

acquire, smaller production companies. An international example is the French TV production firm Banijay, which acquired Endemol Shine

from Disney and Apollo Global Management, creating a global production giant – the largest TV producer outside the US. Fremantle has

invested heavily in a large number of smaller production companies to accelerate its growth in scripted series, films and documentaries.


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Strategy

The international media industry is in the middle of a fundamental transformation, with huge opportunities for those prepared to shape the

future.

RTL Group transforms its business for higher reach and better monetisation to unlock these opportunities. Combining linear TV channels and

non-linear services increases total reach and requires investments in content, marketing and state-of-the-art streaming services. Targeting,

personalisation and recommendation improve the monetisation of that reach and require investments in advertising technology and data.

RTL Group’s Board of Directors and Executive Committee have defined a strategy that builds upon three priorities:

1 Strengthening the Group’s core businesses.

2 Expanding RTL Group’s growth businesses, in particular in the areas of streaming, content production and technology.

3 Fostering alliances and partnerships in the European media industry.

Core

Strengthening RTL Group’s families of channels

Wherever attractive opportunities arise, the Group aims to consolidate across its existing European broadcasting footprint – including

mergers and acquisitions. The strategic rationale is about scale, pooling resources and creativity to compete with global tech platforms in the

respective national markets. Instead of consolidating in larger steps, as initially planned, RTL Group executes a series of smaller steps as an

alternative path to scale. This includes, for example, strengthening the Group’s national and international ad sales businesses, fostering

distribution partnerships, investments in streaming technology and data, or smaller consolidation steps. In Belgium, Croatia and most

recently in the Netherlands, RTL Group decided to sell its TV and streaming businesses to regional media companies so that they can act as

consolidators in these markets.

Building and extending families of TV channels addresses increasing audience fragmentation and competition in a digital, multi-channel

world, with the overall goal of maintaining or growing RTL Group’s audience shares and net TV advertising market shares in the various

countries. Over the past years, RTL Group’s families of channels have been extended by digital channels, including Nitro, RTL Up, Vox Up, and

6ter.

To further strengthen its broadcasting business, RTL Group aims to increase non-advertising revenue. This includes growing revenue from

platform operators – cable network operators, satellite companies and internet TV providers – for services such as high-definition TV

channels, streaming platforms and digital pay channels (distribution revenue) as well as intensifying distribution and pay streaming

partnerships.

Investing in premium content

Investing in premium content and exploring all ways to develop and own new hit formats are key to strengthening RTL Group’s core business.

In 2023, RTL Group spent around €4 billion on content, combining the programming spend of its broadcasters and the productions of its

global content business, Fremantle. Investment in local, exclusive content – including the rights for live sports events – strengthens RTL

Group’s linear TV channels, streaming services and its news and magazine formats.

The following deals strengthen the Group’s linear channels, helping to attract male audiences, and play an important part in gaining new

paying subscribers for the Group’s streaming services:

Germany

– Uefa Europa League and Europa Conference League for the seasons 2024/25 to 2026/27

– Sub-licence of the exclusive rights to 12 Uefa Euro 2024 matches from Deutsche Telekom

– Half of all football matches of the German national team in the Uefa Nations League until 2028

– European Qualifiers for both the Fifa World Cup 2026 and Uefa Euro 2028

– National Football League (NFL) matches including the Super Bowl until 2028

– Content partnership with Sky Deutschland: seven Formula 1 races broadcast live on RTL in Germany, alongside one game from the English

Premier League per match week on RTL+, and three conference broadcasts of the 2nd Bundesliga on RTL. The partnership also includes

selected highlights rights and Sky fiction productions. Sky Deutschland will receive rights to two Uefa Europa League or Uefa Europa

Conference League games per match week

– Licensing agreement with Paramount Global Content Distribution: attractive programme package for RTL+ and RTL Deutschland’s free-

to-air TV channels, including German premieres and highlights from Paramount’s library

– Strategic partnership with Constantin Film: cross-platform licensing of exclusive free-to-air TV content and exclusive streaming rights for

all theatrical productions in Germany

France

– Uefa Europa League and Europa Conference League for the 2022/23 and 2023/24 seasons

– Free-to-air TV rights of the Uefa Champions League finals in 2025, 2026 and 2027

– Shared free-to-air TV rights of the Uefa Euro 2024 with TF1, with Groupe M6 broadcasting a total of 13 matches including the final, one

semi-final and two quarter-finals

– 18 matches of the 2023 Rugby World Cup


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Others

– Hungary: Uefa Champions League starting in the 2024/25 season for three years

– Hungary: retained linear and digital rights to the Uefa Europa League and the Uefa European Conference League for three years for the

seasons 2024/25 to 2026/27

– Luxembourg: Uefa Champions League until 2024 and Uefa European Qualifiers until 2028

– Luxembourg: Formula 1 races until 2026

Managing the portfolio

RTL Group’s management continuously reviews the Group’s portfolio. In the past years, RTL Group sold several non-core assets in Europe,

including the football club Girondins de Bordeaux and the website MonAlbumPhoto in France, the home entertainment and theatrical

distribution company Universum Film in Germany, the Vancouver-based digital video network BroadbandTV (BBTV), the US ad-tech

company SpotX, the US-based mobile entertainment company Ludia and the US software and data company for media measurement,

VideoAmp.

These disposals are consistent with RTL Group’s strategy to focus on growing its European digital businesses in the areas of streaming and

advertising technology, alongside the Group’s global content business, Fremantle.

Growth

Building national streaming champions

RTL Group is building national streaming champions in the European countries where it has leading families of TV channels. These streaming

services capitalise on the Group’s competitive advantage in local programming to complement global services such as Netflix, Amazon

Prime and Disney+.

RTL Group operates the services RTL+ in Germany and Hungary and 6play in France that have gradually introduced a hybrid business model

consisting of various price packages. Lower-priced or free packages are predominantly or fully financed by advertising. Various premium

price packages include, for example, parallel streams on various devices, the live signal of RTL TV channels in HD quality and premium

content bundles. These content bundles offer programmes from the Group’s linear TV channels in the respective countries, plus premium

content either exclusively produced or licensed from third parties.

Following the envisaged disposal of the Dutch streaming service Videoland and the investments in M6+ in France, RTL Group has updated

the targets for its streaming services RTL+ in Germany, RTL+ in Hungary and M6+ (previous 6play) in France: by 2026, the Group aims to

reach around 9 million paying subscribers and around €750 million of streaming revenue. RTL Group plans to increase its content spend to

around €500 million and to become profitable by 2026. At the end of December 2023, RTL Group registered 5.569 million paying

subscribers for its streaming services RTL+ in Germany and Hungary and 6play in France, up 30.5 per cent year on year (end of December

2022: 4.267 million).

In Germany, the Group rebranded its rapidly growing streaming service as RTL+ in November 2021 and launched the RTL+ multimedia app at

the beginning of August 2023. RTL+ is the first German all-in-one streaming bundle that combines video, music, audiobooks, podcasts and

magazine content in one subscription and one app, which is a unique selling proposition in the German-speaking market.

In France, Groupe M6’s streaming service 6play is the ad-funded streaming service, with 21.3 million active users. In October 2022, Groupe

M6 launched 6play Max, a paid subscription video-on-demand version of 6play, developed by RTL Group’s streaming technology company

Bedrock. Within this subscription offer, users can watch content without advertising, in full HD and including download features. In March

2024, Groupe M6 presented its investment plan for its streaming service M6+ (previous 6play). The additional investments of €100 million in

content, technology and marketing will build up over time. The service will be primarily financed by advertising (AVOD), complemented by a

premium subscription tier (SVOD). It will feature exclusive local content accessible from all screens alongside offering innovative

experiences for the viewers and a higher value proposition for advertisers.

In Hungary, RTL Hungary launched its streaming service RTL+ in November 2022. The new service offers exclusive local content, which is a

unique feature in the Hungarian streaming landscape, and is also based on the technology of Bedrock.

Expanding RTL Group’s global content business, Fremantle

RTL Group’s content business, Fremantle, is one of the world’s largest creators, producers and distributors of scripted and unscripted content.

Fremantle runs an international network of teams across production and distribution in 27 countries. The company is responsible for more

than 11,000 hours of programming per year, and distributes content worldwide.

Fremantle aims to achieve full-year revenue of €3 billion by 2025/2026. To reach this goal, RTL Group is investing in Fremantle across

entertainment, drama and film, and documentaries – both organically and via acquisitions. After integrating its acquired labels/production

companies into the Fremantle network and reducing overhead, Fremantle’s Adjusted EBITA margin is expected to increase to 9 per cent by

2026.


RTL Group Annual Report 2023


		12

Fremantle pursues three strategic goals:

– Protect and grow the core: Maintaining its position as a leading producer and distributor of quality programming by nurturing established

brands such as Idols, Got Talent and Farmer Wants a Wife, while investing in creating new formats and brands and expanding the client

base with global streaming platforms such as Netflix and Amazon Prime.

– Grow drama, film and documentaries: Fremantle has made a series of investments in talent and labels to grow its drama, film and

documentary business, and be the best choice for talent. The company has strengthened its European footprint, expanded its scripted

business and invested in several documentary production companies to become a leading producer of high-end documentaries.

– Create a portfolio business by exploiting new monetisation models such as branded entertainment, direct-to-consumer and FAST

channels. Fremantle has launched 23 own FAST channels in 12 territories, such as Family Feud Classic, Jamie Oliver, Baywatch and

America’s Got Talent, which are currently available on different platforms. Fremantle has an ambitious plan to leverage its global footprint

and grow the business internationally.

Fremantle continues to invest in high-end productions to accelerate its growth in drama series, films and documentaries. Acquisitions

include, for example, Miso Film in Scandinavia, This is Nice Group in the Nordics, Wildside and Lux Vide in Italy, Asacha Media Group and Kwaï

in France, A Team Productions in Belgium, Abot Hameiri and Silvio Productions in Israel, Dancing Ledge Productions, 72 Films, Wildstar Films

and Boldprint Studios in the UK, Passenger and Fabel in the US, Eureka in the US and Australia, Element Pictures in Ireland and Beach House

Pictures in Asia.

Fremantle also bought minority stakes in a number of new production companies to secure first access to their creative talent and output.

Working with world-class storytellers is key to Fremantle’s scripted strategy.

As a result of this strategy, Fremantle generated 31 per cent of its total revenue in 2023 from drama and film productions.

To replicate this success in documentaries, Fremantle has established a new global documentaries division, acquired documentary

production companies, and set up its own premium documentary label Undeniable, which focuses on producing world-class premium feature

documentaries.

Investing in technology and data

Combining the strengths of RTL Group’s core business – high reach, brand safety and emotional storytelling – with data and targeting offers

significant growth potential for the Group’s largest revenue stream: advertising. Addressable TV will grow the available inventory, attract new

advertisers and can be sold with a premium compared to traditional linear TV advertising.

RTL Group’s largest unit, RTL Deutschland, is responsible for the Group’s ad-tech business, Smartclip. Based on the Smartclip technology,

RTL aims to create an open ad-tech platform tailored to the needs of European broadcasters and streaming services. Accordingly, RTL

Deutschland will invest further in evolving and growing the Smartclip platform. This includes acquisitions such as French ad-tech company

Realytics, which complemented the existing ad-tech stack. Realytics systematically analyses the impact of TV advertising on advertiser

websites and ensures data availability for digital ad decision-making.

With its European ad-tech businesses, RTL Group made significant progress in building an open European ad-tech platform and in tapping

into the high-growth market of addressable TV (ATV) advertising. In 2021, it was predicted that in Germany alone, the market for ATV

advertising was expected to grow to more than €500 million by 2025. Based on this prediction, RTL Deutschland was expected to generate

approximately €200 million in ATV advertising revenue by 2025. However, the macroeconomic environment in the past three years, the

slower technical distribution of connected smart TV devices and set top boxes, and the acceptance of ATV advertising by clients delayed

market growth. RTL Group expects that RTL Deutschland will generate approximately €200 million in ATV advertising revenue by 2027, two

years later than previously planned.

Bedrock, a French technology company co-founded by RTL Group and Groupe M6, builds the tech platform for Groupe M6’s streaming

service 6play, Videoland in the Netherlands and RTL+ in Hungary. This common platform allows RTL Group to bundle streaming technology

investments.

Alliances and partnerships

In competing with the global tech platforms, new alliances and partnerships between European media companies become increasingly

important.

In autumn 2019, RTL Group’s management started to promote new partnership opportunities – all based on the philosophy of bundling

European broadcasters’ resources to establish open and neutral platforms. RTL Group offers these partnership opportunities in areas such as

advertising sales, advertising technology, streaming technology, content creation and data.

As part of the envisaged sale of RTL Nederland, RTL Group and DPG Media will enter into a strategic partnership, spanning from technology

to advertising sales and content. At the time of closing the transaction, the service agreements for RTL Nederland in the areas of streaming

technology (via Bedrock), broadcasting operations (via RTL Group’s technical services provider BCE) and international advertising sales (via

RTL AdAlliance) will be renewed for at least three years. RTL Nederland will also continue to use the solutions provided by RTL Group’s ad-

tech business, Smartclip.

In November 2020, RTL Deutschland and Deutsche Telekom announced a strategic partnership to integrate the streaming subscription

RTL+ Premium within Deutsche Telekom’s TV offer, Magenta TV. Since then, price plans for both Magenta TV Smart and Magenta TV Smart


RTL Group Annual Report 2023


		13

Flex have included RTL+ Premium with no additional fee for customers. In addition, RTL Deutschland sub-licensed the exclusive rights to 12

Uefa Euro 2024 matches from Deutsche Telekom.

In December 2023, Sky Deutschland and RTL Deutschland announced a strategic two-year content partnership to offer German viewers

access to even more live sport. The innovative partnership, which is unique in the German TV market so far, has the goal of delivering greater

value to both Sky and RTL viewers by exchanging content. This includes sub-licensing seven Formula 1 races, one game from the English

Premier League per match week on RTL+, alongside three conference broadcasts of the 2nd Bundesliga for RTL Deutschland and Uefa

Europa League or Uefa Europa Conference League matches for Sky Deutschland. The partnership additionally includes selected highlights

rights, Sky fiction blockbusters and close collaboration in production and on-screen editorial between the two broadcasters.

Driving international advertising sales

One key development for RTL Group’s largest revenue stream – advertising – has been the increased demand from advertisers and agencies

for global ad-buying opportunities. Consequently, RTL Group is expanding international advertising sales to cater to the demand from

international advertisers and agencies for easy access to the Group’s large portfolio of TV and streaming services, digital video company and

advertising technology in a brand-safe environment.

In 2022, RTL Group combined RTL AdConnect, G+J iMS and the media division of Smartclip to create an international advertising sales

champion: RTL AdAlliance. RTL AdAlliance provides international advertisers with simplified access to a unique portfolio of media brands

across TV, digital video, radio/audio, online, mobile and print.

Building one-stop sales houses for cross-media campaigns

On the national level, the German Ad Alliance launched in 2016, offering high reach to advertisers and agencies. The German Ad Alliance is a

one-stop shop for the development of cross-media solutions and innovative advertising products. Its portfolio spans television, radio/audio,

print, and digital. Ad Alliance is the only sales house in Germany that offers complex, all-media campaigns from a single source. In 2019, the

sales house Media Impact (Axel Springer) became a partner of the German Ad Alliance, and from January 2024, Ad Alliance has taken over

the advertising sales of the digital portfolio of Bauer Advance. The partnership includes all digital brands of the Bauer Media Group and is a

further step towards RTL Group’s envisaged ad sales consolidation. Together, the platforms of Ad Alliance reach 99 per cent of the German

population. Ad Alliance remains open to additional partnerships.


RTL Group Annual Report 2023


		14

Capital markets and share

RTL Group’s shares (ISIN: LU0061462528) are publicly traded on the regulated market (Prime Standard) of the Frankfurt Stock Exchange

and the Luxembourg Stock Exchange. RTL Group is listed in the MDAX stock index.

RTL Group share price development for January to December 2023

based on the Frankfurt Stock Exchange (Xetra) against MDAX,

Euro Stoxx 600 Media (SXMP) and ProSiebenSat1

RTL Group’s share price started 2023 at €40.62 and finished the year down 16.6 per cent, at €34.96. The share price highs and lows were

€49.24 (19 April) and € 31.50 (13 December).

Quarterly, the average share price evolved as follows:

Q1: €44.77

Q2: €40.57

Q3: €35.25

Q4: €33.10

The Group declared a dividend in April 2023 that was paid on 2 May 2023. The payment of €4.00 (gross) per share related to the 2022 full-

year dividend. The total dividend paid amounted to €619 million. Based on the average share price of €42.04 in 2022, this represented a

dividend yield of 9.5 per cent and a dividend payout ratio of 94 per cent, in line with the Group’s dividend policy.

For more information on the analysts’ views on RTL Group and RTL Group’s equity story, please visit the Investor Relations section on rtl.com.

RTL Group rating

In 2019, RTL Group decided to cancel its ratings from both S&P and Moody’s. Until the date of the cancellation, these ratings were fully

aligned to RTL Group’s parent company, Bertelsmann SE & Co KGaA, due to its shareholding level and control of RTL Group.

RTL Group dividend policy

RTL Group’s dividend policy offers a payout ratio of at least 80 per cent of the Group’s adjusted net result.

The adjusted net result is the reported net result available to RTL Group shareholders, adjusted for any material non-cash impacts, such as

goodwill impairments.

RTL Group shareholding structure

The share capital of the company is set at €191,845,074, divided into 154,742,806 shares with no par value.


RTL Group Annual Report 2023


		15

The shares are in the form of either registered or bearer shares, at the option of the owner.

Bertelsmann has been the majority shareholder of RTL Group since July 2001. As at 31 December 2023, Bertelsmann held 76.28 per cent of

RTL Group shares, and 23.72 per cent were free float.

There is no obligation for a shareholder to inform the company of any transfer of bearer shares save for the obligations provided by the

Luxembourg law of 15 January 2008 on transparency requirements in relation to information about issuers whose securities are admitted to

trading on a regulated market. Accordingly, the company shall not be liable for the accuracy or completeness of the information shown.

Analyst coverage

as at 31 December 2023

A detailed overview on the analysts’ views on RTL Group can be found on rtl.com.


RTL Group Annual Report 2023


		16

11 Based on analyst coverage as at 31 December 2023

RTL Group share master data



ISIN		LU0061462528
Exchange symbol		RRTL
WKN		861,149
Share type		Ordinary
Bloomberg code		RRTL:GR
Reuters code		RRTL
Ticker		RRTL
Transparency level on first quotation		Prime Standard
Market segment		Regulated Market
Trading model		Continuous Trading
Sector		Media
Stock exchanges		Frankfurt, Luxembourg
Last total dividend (for financial year 2022)		€4.00
Number of shares		154,742,806
Market capitalisation 12		€5,409,808,498
52 week high		€49.24 (19 April 2023)
52 week low		€31.50 (13 December 2023)


RTL Group Annual Report 2023


		17

12 As of 31 December 2023

Discontinued operations/application IFRS 5

Due to the reached agreement to sell RTL Nederland communicated on 15 December 2023, the operating segment RTL Nederland is

classified as held for sale and presented as a discontinued operation in the consolidated financial statements 2023 (Application of IFRS 5

‘Non-current assets held for sale and discontinued operations’ to the operating segment RTL Nederland). The prior-year figures of the

consolidated income statement are restated in accordance with IFRS 5 to report the discontinued operations separately from continuing

operations. The envisaged sale of RTL Nederland is subject to regulatory approvals and the consultation process with the respective works

councils.

In addition, RTL Group prepared selected pro-forma KPIs for the financial year 2023, including RTL Nederland. RTL Group’s outlook (see

Outlook on page 55) for the full-year 2023, as communicated on 8 November 2023, was based on these pro-forma figures. For these pro-

forma figures see Financial year 2023 in review on page 3).

Financial results RTL Nederland

In 2023, the Dutch net TV advertising market was estimated to be down by 8.0 per cent, with RTL Nederland outperforming the market.

RTL Nederland’s total revenue decreased by 2.5 per cent to €620 million (2022: €636 million), as lower TV advertising revenue was partly

compensated by higher streaming revenue. This resulted in an Adjusted EBITA of €145 million, down 9.9 per cent year on year (2022: €161

million), with the streaming service Videoland being close to breakeven.

Audience ratings RTL Nederland

In 2023, RTL Nederland’s family of channels grew its combined prime-time audience share in the target group of viewers aged 25 to 54 to

35.1 per cent (2022: 34.7 per cent).

RTL Nederland operates the leading family of TV channels in the Netherlands, comprising five free-to-air TV channels (RTL 4, RTL 5, RTL 7,

RTL 8 and RTL Z), three digital pay-TV channels (RTL Lounge, RTL Crime, RTL Telekids) and an independent news organisation. With

1.4 million paying subscribers, Videoland is the country’s number-one local streaming service.

Further information can be found in note 6.11 to RTL Group’s consolidated financial statements.


RTL Group Annual Report 2023


		18

Key performance indicators

RTL Group analyses key performance indicators (KPIs) to manage its businesses, including revenue, organic growth/decline, Adjusted EBITA,

Adjusted EBITA before streaming start-up losses, Adjusted EBITA margin, net debt, operating cash conversion rate and audience shares in

the company’s main target groups. RTL Group’s KPIs are mostly determined on the basis of so-called alternative performance measures,

which are not defined by IFRS. Management believes they are relevant for measuring the performance of the Group’s operations, financial

position and cash flows, and for making decisions. These KPIs also provide additional information for users of the financial statements

regarding the management of the Group on a consistent basis over time and regularity of reporting. These should not be considered in

isolation but as complementary information for evaluating the Group’s business situation. RTL Group’s KPIs may not be comparable to

similarly titled measures reported by other groups due to differences in the way these measures are calculated.

KPIs are reported for continuing operations. The contribution in 2023 from RTL Nederland, if any, to each line of RTL Group’s consolidated

income statement (before non-controlling interests) has been reported on the line ‘Group profit from discontinued operations’. In accordance

with IFRS 5, these adjustments have been applied to all periods presented to ensure consistency of information.

Organic growth/decline

Organic growth is calculated by adjusting the reported revenue growth mainly for the impact of exchange rate effects, corporate acquisitions

and disposals. It should be seen as a component of the reported revenue shown in the income statement. Its main objective is for the reader

to isolate the impacts of portfolio changes and exchange rates on the reported revenue. When determining the exchange rate effects, the

functional currency that is valid in the respective country is used. Potential other effects may include changes in methods and reporting.

Adjusted EBITA

EBIT, Adjusted EBITA and EBITDA are indicators of operating profitability. With significant investments in the Group’s streaming activities,

RTL Group additionally uses Adjusted EBITA before streaming start-up losses. The KPI for the operating profitability of RTL Group and its

business units is Adjusted EBITA. Analysts, investors and peers of RTL Group use EBITDA to assess profitability. The use of EBITDA eliminates

potential differences in performance caused by variations in capital structures and the cost and age of tangible and intangible assets

(affecting relative depreciation expense and relative amortisation expense respectively). As a result, for these purposes the calculation of

EBITDA and further for reconciliation purposes Adjusted EBITDA for RTL Group are also disclosed.

RTL Group comments primarily on Adjusted EBITA as the KPI for measuring profitability.

Adjusted EBITA represents a recurring operating result and excludes significant special items. RTL Group management has established an

‘Adjusted EBITA’ that neutralises the impacts of structural distortions for the sake of transparency. Based on the accelerated industry trends

explained in the Market section (pages 9 to 10) and Strategy section (pages 11 to 14) in this Directors’ report, RTL Group plans to increase its

investments in business transformation including streaming, premium content, technology and data. At the same time, management

continually assess opportunities to reduce costs in the Group’s traditional broadcasting activities – for example, reallocating resources from

its traditional businesses to its growing digital businesses – and this may lead to restructuring expenses that are neutralised in the Adjusted

EBITA.

Adjusted EBITA is determined as earnings before interest and taxes (EBIT) as disclosed in the income statement excluding the following

elements:

– Impairment of goodwill of subsidiaries and amortisation and impairment of fair value adjustments on acquisitions of subsidiaries

– Impairment and reversals of investments accounted for using the equity method

– Impairment and reversals on other financial assets at amortised cost presented in ‘Other operating expenses’ or ‘Other operating income’

– Re-measurement of earn-out arrangements presented in ‘Other operating income’ or ‘Other operating expenses’

– Fair value measurement of investments presented in ‘Other operating income’ or ‘Other operating expenses’

– (Gain)/loss from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree

– Significant special items

Significant special items exceeding the cumulative threshold of €5 million need to be approved by management, and primarily consist of

restructuring expenses or reversal of restructuring provisions and other special factors or distortions. The adjustments for special items serve

to determine a sustainable operating result that could be repeated under normal economic circumstances and is not affected by special

factors or structural distortions. In 2023, ‘Significant special items’ amount to €-125 million, reflecting mainly restructuring measures at RTL

Deutschland (€-87 million) and personnel cost efficiency measures at Fremantle (€-26 million). The remaining amount is attributable to

expenses in connection with strategic portfolio measures and to the transformation project relating to a new Enterprise Resource Planning

(ERP) solution where implementation costs were expensed as incurred. In 2022, ‘Significant special items’ reflected restructuring and

integration costs in Germany (€-33 million) following the Gruner + Jahr transaction as well as the impact of expenses in connection with

strategic portfolio management (€-11 million).


RTL Group Annual Report 2023


		19


	2023	2022
	€m	€m

Earnings before interest and taxes (EBIT)	620	828
Impairment of goodwill of subsidiaries	–	–
Amortisation and impairment of fair value adjustments on acquisitions of subsidiaries	43	46
Impairment and reversals of investments accounted for using the equity method	–	5
Impairment and reversals on other financial assets at amortised cost	2	30
Re-measurement of earn-out arrangements	9	–
Fair value measurement of investments	23	78
(Gain)/loss from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree	(40)	(107)
EBITA	657	880
Significant special items	125	42
Adjusted EBITA	782	922

The figures from the previous year have been adjusted due to discontinued operations (see note 1.30 to the consolidated financial

statements).

Adjusted EBITA before streaming start-up losses

In accordance with RTL Group’s strategy, the company continued to invest heavily in its streaming services, RTL+ in Germany and Hungary

and 6play in France (to be rebranded M6+ in 2024), all of which have seen a rapid increase in the number of paying subscribers (for further

details please refer to Building national streaming champions on page 12). The Adjusted EBITA of RTL Group is impacted by effects relating

to the growth of its streaming services. These are operational in nature, and are not included in ‘Significant special items’. RTL Group believes

the disclosure of ‘streaming start-up losses’ and ‘Adjusted EBITA before streaming start-up losses’ provides important context for its

business performance, hence it discloses information relating to both KPIs in addition to its leading alternative performance measure,

‘Adjusted EBITA’. Streaming start-up losses are defined as a total of Adjusted EBITA from RTL+ in Germany and Hungary, 6play in France

(from 2023), Salto and Bedrock as consolidated on RTL Group level. For the year 2023, the total of streaming start-up losses amounted to

€176 million (2022: €222 million). Adjusted EBITA before streaming start-up losses was €958 million (2022: €1,144 million).

Adjusted EBITA margin

The Adjusted EBITA margin as a percentage of Adjusted EBITA of revenue is used as an additional criterion for assessing business

performance.

EBITDA/Adjusted EBITDA

EBITDA represents earnings before interest and taxes (EBIT) excluding some elements of the income statement:

– Amortisation and impairment of non-current programme and other rights, of other intangible assets, depreciation and impairment of

property, plant and equipment (excluding the part concerning goodwill and fair value adjustments) and of right-of-use assets reported in

‘Depreciation, amortisation and impairment’

– Impairment of goodwill of subsidiaries and amortisation and impairment of fair value adjustments on acquisitions of subsidiaries

– Impairment and reversals of investments accounted for using the equity method

– Impairment and reversals on other financial assets at amortised cost presented in ‘Other operating expenses’ or ‘Other operating income’

– Re-measurement of earn-out arrangements presented in ‘Other operating income’ or ‘Other operating expenses’

– Fair value measurement of investments presented in ‘Other operating income’ or ‘Other operating expenses’

– (Gain)/loss from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree

Adjusted EBITDA is determined as EBITDA excluding significant special items with the same definition as for Adjusted EBITA (please refer to

the definition on page 19).


RTL Group Annual Report 2023


		20


	2023	2022
	€m	€m

Earnings before interest and taxes (EBIT)	620	828
Depreciation, amortisation and impairment	239	231
Impairment of goodwill of subsidiaries	–	–
Amortisation and impairment of fair value adjustments on acquisitions of subsidiaries	43	46
Impairment and reversals of investments accounted for using the equity method	–	5
Impairment and reversals on other financial assets at amortised cost	2	30
Re-measurement of earn-out arrangements	9	–
Fair value measurement of investments	23	78
(Gain)/loss from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree	(40)	(107)
EBITDA	896	1,111
Significant special items¹	123	42
Adjusted EBITDA	1,019	1,153

1 Less depreciation, amortisation and impairment included in ‘Significant special items’

The figures from the previous year have been adjusted due to discontinued operations (see note 1.30 to the consolidated financial

statements).

Operating cash conversion rate

The operating cash conversion rate (OCC) reflects the level of operating profits converted into cash available for investors after

incorporation of the minimum investments required to sustain the current profitability of the business and before reimbursement of funded

debts (interest included) and payment of income taxes. The operating cash conversion rate of RTL Group’s operations is subject to

seasonality and investment cycles. RTL Group historically had – and expects in the future to have – a strong OCC due to a high focus on

working capital and capital expenditure throughout the Group’s operations. OCC should be above 90 per cent in the long-term average and/

or it should normally exceed market benchmarks in a given year.

OCC means operating free cash flow divided by EBITA – operating free cash flow being net cash from operating activities adjusted by the

following elements:

– Income tax paid

– Transaction-related costs with regard to significant disposals of subsidiaries

– Cash outflows from the acquisitions of programme and other rights and other intangible assets and tangible assets

– Cash inflows from proceeds from the sale of intangible and tangible assets


	2023	2022
	€m	€m

Net cash from operating activities	460	323

Adjusted by:
Income tax paid	160	294
Transaction-related costs	–	9

Acquisitions of:
– Programme and other rights	(57)	(68)
– Other intangible and tangible assets	(115)	(129)
Proceeds from the sale of intangible and tangible assets	1	1
Operating free cash flow	449	429

EBITA	657	880

Operating cash conversion rate	68%	49%

The figures from the previous year have been adjusted due to discontinued operations (see note 1.30 to the consolidated financial

statements).


RTL Group Annual Report 2023


		21

Net cash/(debt)

The net cash/(debt) is the gross balance sheet financial debt adjusted for:

– Cash and cash equivalents

– Current deposit with shareholder and its subsidiaries reported in ‘Accounts receivable and other financial assets’

In order to assess RTL Group’s leverage, the net debt to Adjusted EBITDA ratio is used. The ratio is calculated as net debt divided by Adjusted

EBITDA.


	31 December 2023	31 December 2022
	€m	€m

Current loans and bank overdrafts	(253)	(547)
Non-current loans	(689)	(138)
	(942)	(685)

Deduction of:
– Cash and cash equivalents	575	589
– Current deposits with shareholder and its subsidiaries	76	276
Net cash/(debt)	(291)	180

Adjusted EBITDA	1,019	1,153

Net cash/(debt) to EBITDA ratio	(29)%	n.a.

The net debt excludes current and non-current lease liabilities of €301 million (31 December 2022: €385 million).

Operating cost base

Operating cost base is calculated as the sum of ‘Consumption of current programme rights’, ‘Depreciation, amortisation, and impairment’ and

‘Other operating expenses’.


	2023	2022
	€m	€m

Consumption of current programme rights	2,566	2,657
Depreciation, amortisation and impairment	239	231
Other operating expenses	2,969	3,025
Operating cost base	5,774	5,913

The figures from the previous year have been adjusted due to discontinued operations (see note 1.30 to the consolidated financial

statements).

Dividend payout ratio

Dividend payout ratio means the absolute dividend amount divided by the adjusted profit attributable to RTL Group shareholders.

The absolute dividend amount is based on the number of issued ordinary shares at 31 December, multiplied by the dividend per share. The

main adjustments on profit attributable to RTL Group shareholders refer to dilution gains from Global Savings Group (GSG) and fair value

measurement impact from financial instruments. 13


		2023
		€m

Profit attributable to RTL Group shareholders		467
Dividend policy adjustments		26
Adjusted profit for the year attributable to RTL Group shareholders		493
Dividend in € per share		2.75
Dividend, absolute amount		426
Dividend payout ratio13		86%


RTL Group Annual Report 2023


		22

13 Dividend, absolute amount/adjusted profit attributable to RTL Group shareholders

Financial review

Revenue

RTL Group estimates that the net TV advertising markets in 2023 in Germany and France were down throughout the year, whereas the

advertising market in Hungary was up. A summary of RTL Group’s key markets is shown below, including estimates of net TV advertising

market growth rates and the audience shares in the main target audience group.


	Estimated net TV advertising market growth rate 2023 (in per cent)		RTL Group audience share in the main target group 2023 (in per cent)		RTL Group audience share in the main target group 2022 (in per cent)

Germany	-9.5 to -10.5%	14	27.4%	15	26.8%15
France	-4%	16	21.9%	17	22.3%17
Hungary	7.8%	14	28.4%	18	28.9%18

Group revenue was down 5.4 per cent to €6,234 million (2022: €6,589 million), mainly due to significantly lower TV advertising revenue from

broadcasting businesses and lower Fremantle revenue. Group revenue was down 4.1 per cent organically compared to 2022.

RTL Group r evenue bridge in 2023

(in € million)

RTL_GB_2023_Revenue_Bridge 420311adj.jpg

RTL Group’s revenue from advertising, as stated in note 5.1 to the consolidated financial statements, was €3,111 million ( 2022:

€3,319 million), of which €2,368 million represented TV advertising revenue (2022: €2,579 million), €371 million represented digital

advertising revenue (2022: €361 million) and €372 million represented radio, print and other advertising revenue (2022: €379 million).

RTL Group’s content revenue was €1,990 million (2022: €2,112 million), generated by the Group’s global content business, Fremantle, from

the production and distribution of formats for external customers 19. Content revenue is included in ‘Revenue from exploitation of

programmes, rights and other assets’ as stated in note 5.1 to the consolidated financial statements.

Distribution revenue is generated by RTL Group’s broadcasting businesses, mainly from re-transmission fees paid by platform operators

(cable, satellite, internet TV) for the transmission of free-TV and pay-TV signals and for making the Group’s streaming services available on

the operators’ platforms. In 2023, distribution revenue was stable at €331 million (2022: €332 million). Distribution revenue is included in

‘Revenue from exploitation of programmes, rights and other assets’ as stated in note 5.1 to the consolidated financial statements.


RTL Group Annual Report 2023


		23

14 Industry and RTL Group estimates

15 Source: GfK. Target group: 14−59, including pay TV channels

16 Source: Groupe M6 estimate

17 Source: Médiamétrie. Target group: women under 50 responsible for purchases (free-to-air channels: M6, W9, 6ter and Gulli)

18 Source: AGB Hungary. Target group: 18−49, prime time; RTL Hungary has changed the publication of its audience figures as of 2022 and is now using ’Linear SHR’ audience share data calculated

without the category ‘Other’ of Nielsen

19 See note 5.1 to the consolidated financial statements on page 80. Fremantle’s total revenue of €2,266 million (2022: €2,347 million) includes inter-segment revenue of €226 million (2022:

€200 million) – see note 3.1 to the consolidated financial statements.

Revenue from other rights exploitation was €318 million (2022: €264 million) and relates to SVOD revenue from the Group’s major

streaming services and, among others, Groupe M6’s audiovisual rights business SND and We Are Era. Revenue from other rights exploitation

is included in ‘Revenue from exploitation of programmes, rights and other assets’ as stated in note 5.1 to the consolidated financial

statements.

Revenue from selling goods and merchandise and providing services, as stated in note 5.1 to the consolidated financial statements, relates

to a variety of revenue streams, including commissions for handling advertising sales for third-party media partners, publishing subscriptions,

e-commerce and a wide range of services businesses such as the technical services provider BCE, the streaming technology company

Bedrock or the real-estate franchise Stéphane Plaza Immobilier at the level of Groupe M6. In 2023, revenue from selling goods and

merchandise and providing services was €485 million (2022: €561 million). The decrease was mainly due to different disposals at the level of

Groupe M6 in 2022 and 2023 and due to the sale and discontinuation of several magazine titles at the level of RTL Deutschland in 2023.

RTL Group’s revenue is well diversified, with 38.0 per cent from TV advertising, 6.0 per cent from digital advertising, 6.0 from radio, print and

other advertising, 31.9 per cent from content, 5.3 per cent from distribution revenue, 5.1 per cent from other rights exploitation revenue and

7.7 per cent from selling goods and merchandise and providing services.

RTL Group revenue split

As explained in the section about RTL Group’s strategy, building national streaming champions in the European countries where the Group

has leading families of TV channels is imperative for the successful digital transformation and long-term growth of RTL Group (see page 12).

In line with this strategic importance, RTL Group has communicated streaming targets since March 2020, relating to the number of paying

subscribers, annual content spend, streaming revenue and profitability.

The Group’s major streaming services RTL+ in Germany and Hungary as well as 6play in France (to be rebranded M6+ in 2024) generate

digital advertising revenue, distribution revenue as well as pay revenue (SVOD and TVOD) referred all combined as ‘streaming revenue’. In

2023, streaming revenue was up 72.6 per cent, to €283 million (2022: €164 million), thanks to the rapidly growing number of paying

subscribers, higher revenue per subscriber and the first-time inclusion of 6play in France. Streaming revenue is presented in the revenue split

in the categories ‘digital advertising’, ‘distribution’ and ‘other rights exploitation’. Further, streaming revenue is included in categories ‘Revenue

from advertising’ and ‘Revenue from exploitation of programmes, rights and other assets’ presented in note 5.1 to the consolidated financial

statements.


RTL Group Annual Report 2023


		24

Geographical revenue overview


	2023	2023	2022	2022
	€m	%	€m	%

Germany	2,413	38.7	2,593	39.4
France	1,318	21.1	1,367	20.7
United States	1,015	16.3	1,002	15.2
UK	301	4.8	313	4.8
Other regions	1,187	19.0	1,314	19.9

The figures from the previous year have been adjusted due to discontinued operations (see note 1.30 to the consolidated financial

statements).

Adjusted EBITA

Adjusted EBITA 20 declined to €782 million (2022: €922 million), mainly due to lower profit contributions from RTL Deutschland as the

German TV advertising market decreased significantly in 2023. The Adjusted EBITA includes streaming start-up losses of €176 million

(2022: €222 million). The Adjusted EBITA margin20 was 12.5 per cent (2022: 14.0 per cent).

For more detailed information and reconciliation of these measures see pages 19 to 20.

Financial development over time


	2023	2022	2021	2020	2019
	€m	€m	€m	€m	€m

Revenue	6,234	6,589	6,637	6,017	6,651
Adjusted EBITA	782	922	1,152	853	1,156
Net cash/(debt)	(291)	180	657	236	(384)
Operating cash conversion rate (in %)	68	49	114	123	105

The figures from the previous year have been adjusted (see note 1.30 to the consolidated financial statements). Figures prior to 2022 are as

reported in the Annual Report 2022.

Operating cost base

Group operating cost base decreased to €5,774 million in 2023 (2022: €5,913 million), mainly due to lower costs relating to consumption of

programme rights and expenses for live programmes.

Investments accounted for using the equity method

The total share of results of these investments increased to €61 million (2022: €13 million), mainly due to improved results from underlying

companies, in particular from Atresmedia in Spain, and due to the discontinuation of Salto (following the abandoned merger between Groupe

TF1 and Groupe M6). In 2022, the Group experienced a negative impact from its share of net losses from Salto, which amounted to €-18

million.

Fair value measurement of investments

Fair value measurement of investments of €-23 million (2022: €-78 million) is mostly attributable to the negative valuation effects of the

Magnite shares held by RTL Group.

Gain from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree

In 2023, the Group recorded a gain of €40 million (2022: €107 million), mainly thanks to disposals by Groupe M6 and RTL Deutschland. In

2022, the gain resulted from the disposals of RTL Belgium and RTL Croatia.

Financial result

Financial result amounted to the expense of €-13 million (2022: €-56 million). The comprehensive description on the financial result is

disclosed in the notes 5.4 and 5.5 to the consolidated financial statements.

Impairment of goodwill and amortisation and impairment of fair value adjustments on acquisitions of subsidiaries

The Group has conducted impairment testing on the different cash-generating units (see note 6.2 to the consolidated financial statements).

The loss, totalling €-43 million (2022: €-46 million), relates to the amortisation of fair value adjustments on acquisitions of subsidiaries.


RTL Group Annual Report 2023


		25

20 See Key performance indicators on pages 19 to 23 of RTL Group’s Full-year results 2023 report

Income tax expense

In 2023, the income tax expense was €-124 million (2022: €-130 million).

The profit for the year attributable to RTL Group shareholders was €467 million (2022: €673 million), thereof €352 million from continuing

operations (2022: €549 million) and €115 million from discontinued operations (2022: €124 million).

Earnings per share

Earnings per share, based upon 154,742,806 weighted average number of ordinary shares, both basic and diluted, was €2.27 for continuing

operations (2022: €3.55 per share based on 154,742,806 shares).

Own shares

RTL Group has an issued share capital of €191,845,074 divided into 154,742,806 fully paid-up shares with no defined par value.

Since 31 December 2020, the Group no longer holds treasury shares.

Profit appropriation (RTL Group SA)

The annual accounts of RTL Group show a profit for the financial year 2023 of €69,677,341 (2022: €104,596,391). Taking into account the

share premium account of €3,652,764,148 (2022: €4,167,138,981) and the profit brought forward of €70,963,534 (2022: €70,963,534), a

sufficient amount is available for distribution.

Main portfolio changes

After the announcement of the reorganisation of its publishing business in February 2023, RTL Deutschland completed in the second half-

year transactions, among others, the sale of PM, Deutsche Medien-Manufaktur and 11 Freunde. The disposals resulted in net cash inflows of

€4 million.

In July 2023, RTL Group sold its majority stake in CTZAR to the Group The Independents which resulted in net cash inflows of €3 million. Net

of transaction-related costs, the transaction resulted in an overall gain of €2 million.

In September 2023, Groupe M6 sold its thematic online media and services businesses, comprising eight main brands: Cuisine AZ, Passeport

Santé, Fourchette & Bikini, Déco, Turbo, M6 météo, Croq’Kilos and Croq’Body to Prisma Media (owned by Vivendi), which resulted in net cash

inflows of €20 million.

For more detailed information see note 4.3 to the consolidated financial statements.

Major related party transactions

At 31 December 2023, the principal shareholder of the Group is Bertelsmann Capital Holding GmbH (BCH) (76.28 per cent). The remainder of

the Group’s shares are publicly listed on the Frankfurt and Luxembourg Stock Exchanges. The ultimate parent company of RTL Group SA,

Bertelsmann SE & Co KGaA, includes in its consolidated financial statements those of RTL Group SA.

The Group also has a related party relationship with its associates, joint ventures, directors and executive officers.

The comprehensive description on the related party transactions is disclosed in note 10 to the consolidated financial statements.


RTL Group Annual Report 2023


		26

General management statement on the

fiscal year 2023 performance

Linear TV continues to dominate the video market as the key medium to consistently reach mass audiences every day. People watch more

video content than ever before – linear and non-linear, long-form and short-form, on televisions and mobile devices – and increasingly on

different streaming services. The demand for high-quality video content, and with it, online video advertising, continues to grow.

RTL Group estimates that the net TV advertising markets in 2023 in Germany and France were down throughout the year, whereas the

advertising market in Hungary was up. This was mainly due to a continuing challenging macroeconomic environment, in particular due to an

uncertain political environment, inflation and energy supply issues. Nevertheless, RTL Group’s families of channels were able to gain TV

advertising market shares, especially in Germany. Taking into consideration the rapidly changing media landscape and challenging

macroeconomic environment, RTL Deutschland thoroughly reviewed its publishing business at the beginning of 2023. In February 2023, RTL

Deutschland announced a reorganisation of its publishing business to focus on its core brands Stern, Geo, Capital, Stern Crime, Brigitte, Gala,

Schöner Wohnen, Häuser, Couch, Eltern, Chefkoch, Geolino and Geolino Mini, which account for around 70 per cent of its publishing revenue.

Other brands were sold or discontinued. This reorganisation was largely completed by the end of 2023 with significant restructuring costs of

€87 million.

Across Europe, RTL Group’s flagship channels remained number one or two in their respective markets and target groups. RTL Deutschland

reported higher audience shares and increased the lead over its commercial competitor to the highest in 10 years with RTL and Vox being the

first two commercial channels in the German market. The audience shares of Groupe M6 and RTL Hungary, meanwhile, decreased.

In 2023, RTL Group announced a significant portfolio change: the envisaged sale of RTL Nederland to DPG Media. In Belgium, Croatia and

most recently in the Netherlands, RTL Group decided to sell its TV and streaming businesses to regional media companies so that they can

act as consolidators in these markets. In France, Groupe M6 completed the sale of its online thematic media and services division Prisma

Media.

RTL Group’s growth businesses of streaming and content performed particularly well. RTL+ in Germany and Hungary and 6play in France

registered 5.6 million paying streaming subscribers, and Fremantle achieved many creative successes winning 145 awards (2022: 115). In

August 2023, RTL Deutschland started the roll-out of Germany’s first multimedia app RTL+, which offers video, music, podcasts, audiobooks

and magazine content in one single app. To further increase awareness and establish RTL+ among its target group, RTL Deutschland

launched a major cross-media marketing campaign that is still running.

RTL Group’s streaming revenue increased by 72.6 per cent to €283 million during 2023 as a result of subscriber growth, higher revenue per

subscriber and the first-time inclusion of 6play in France.

In addition, RTL Group continued to develop its content production business, Fremantle, targeting €3 billion revenue by 2025/2026.

Fremantle will continue to focus on entertainment, drama and film, and documentaries. Major creative film successes included Poor Things,

which was awarded four Academy Awards (Oscars) out of eleven nominations and won five BAFTAs and two Golden Globes, and C'è ancora

domani (There’s Still Tomorrow), Italy’s most successful film of 2023. Successful shows were Got Talent in the UK and the US, and

Neighbours, which returned to Amazon Freevee, alongside the documentaries House of Kardashian and Waco: American Apocalypse. The

company has positioned itself as a producer of quality TV drama and film, with worldwide appeal to both broadcasters and streaming

services. To further boost the documentaries business, Fremantle launched its new label Undeniable, which focuses on producing world-class

premium feature documentaries.

For the full year 2023, RTL Group generated an Adjusted EBITA of €782 million. The Adjusted EBITA includes streaming start-up losses of

€176 million (2022: €222 million). The Adjusted EBITA margin was 12.5 per cent. The second half of 2023 was very strong, despite challenging

advertising markets and significant streaming start-up losses. RTL Group ended the year 2023 with a solid set of financial results, including a

total Group profit of €598 million.

At the time of writing, RTL Group is characterised by a strong financial position and operating performance, despite the continuing

challenging macroeconomic environment. A strong performance enables both attractive dividend payments and significant investments in

streaming services, technology, and the growth of the Group’s content business.

RTL Group is therefore in a strong position to accelerate its strategy:

– It has a highly profitable, well-established, cash-generating core business in TV broadcasting.

– The company is heavily investing in its streaming services, RTL+ in Germany and Hungary and M6+ (previous 6play) in France.

– The company’s content production company Fremantle has successfully branched out into drama and film, high-end factual and

documentary programming.

– The company is among the European leaders in ad-tech.

– The company is building alliances and partnerships in areas such as advertising sales, ad-tech, streaming technology and content.


RTL Group Annual Report 2023


		27

Review by segments

Full year 2023 21


Revenue	2023	2022	Per cent
Revenue	€m	€m	change

RTL Deutschland	2,620	2,766	(5.3)
Groupe M6	1,316	1,357	(3.0)
Fremantle	2,266	2,347	(3.5)
Other segments	350	411	(14.8)
Eliminations	(318)	(292)
Total revenue	6,234	6,589	(5.4)


Adjusted EBITA	2023	2022	Per cent
Adjusted EBITA	€m	€m	change

RTL Deutschland	321	459	(30.1)
Groupe M6	311	304	+2.3
Fremantle	139	162	(14.2)
Other segments	11	(12)	<100.0
Eliminations	–	9
Adjusted EBITA	782	922	(15.2)


Adjusted EBITA margin	2023	2022	Percentage point
Adjusted EBITA margin	per cent	per cent	change

RTL Deutschland	12.3	16.6	(4.3)
Groupe M6	23.6	22.4	1.2
Fremantle	6.1	6.9	(0.8)
RTL Group	12.5	14.0	(1.5)

RTL Deutschland

Financial results

In the reporting period, the German net TV advertising market was estimated to be down between 9.5 and 10.5 per cent, with RTL

Deutschland performing better than the market. Total revenue of RTL Deutschland was down 5.3 per cent to €2,620 million (2022:

€2,766 million), due to significantly lower TV advertising revenue. This was partly compensated by higher streaming revenue. Adjusted

EBITA declined 30.1 per cent to €321 million (2022: €459 million), mainly due to significantly lower TV advertising revenue and

significant streaming start-up losses.

Audience ratings

In 2023, the combined average audience share of RTL Deutschland in the target group of viewers aged 14 to 59 was 27.4 per cent (2022: 26.8

per cent), including the pay-TV channels RTL Crime, RTL Living, RTL Passion and Geo Television. The German RTL family of channels

increased its lead over its main commercial competitor, ProSiebenSat1, to 5.8 percentage points – the highest in 10 years (audience share

2022: 21.6 per cent, lead up 1.3 percentage point compared to the previous year).

With its portfolio of eight free-TV channels, four pay-TV channels and the streaming service RTL+, RTL Deutschland reached 26.5 million

viewers every day in 2023 (2022: 27.9 million).

With an audience share of 9.4 per cent (up 0.3 percentage points) in the target group of viewers aged 14 to 59 (2022: 9.1 per cent), the

German main channel RTL was the leading commercial channel in 2023 and the only large channel increasing its audience share, ahead of

ZDF (9.2 per cent), Das Erste (8.7 per cent), Vox (6.2 per cent), Sat1 (6.0 per cent) and Prosieben (5.4 per cent).


RTL Group Annual Report 2023


		28

21 The figures from the previous year have been adjusted due to discontinued operations (see note 1.30 to the consolidated financial statements)

The match of the German national football team against the US team was the channel’s most watched programme in 2023. On average, 7.47

million total viewers (30.3 per cent) watched the premiere of coach Julian Nagelsmann on 14 October 2023 (14 to 59: 3.72 million viewers;

34.3 per cent audience share). The NFL games were also very successful on the German main channel RTL. On 19 November 2023, the NFL

game of the Chicago Bears vs. Detroit Lions generated the highest total reach of an NFL regular season game (at 19:00) on German free-to-

air TV, with a total of 850,000 viewers. Ich bin ein Star – Holt mich hier raus! (I’m a Celebrity – Get Me Out of Here!) was also very successful

in 2023, and even more popular than in the previous year. On average, 4.14 million total viewers (21.6 per cent total audience share) watched

the 16th season, representing an average audience share of 29.2 per cent in the commercial target group of viewers aged 14 to 59. The 16th

season of Let’s Dance generated the best audience share since 2014 among total viewers, scoring an average of 17.5 per cent. The dance

show also generated high ratings in the commercial target group, with an 18.1 per cent audience share (2022: 17.6 per cent). With an average

audience share of 11.4 per cent in the target group of viewers 14 to 59, the news magazine Punkt 12 increased its market share compared to

2022 (10.5 per cent). In access prime time, the daily series Gute Zeiten, schlechte Zeiten continued to generate a high audience share and

attracted 13.9 per cent of viewers aged 14 to 59 (2022: 13.7 per cent).

The streaming service RTL+ continued its rapid growth with a record year in 2023, reaching 4.941 million paying subscribers at the end of the

year – an increase of 23.0 per cent (2022: 4.016 million). Viewing time increased by 26.3 per cent year on year, making RTL+ the leading

German entertainment offering in the streaming market. This success was thanks to the wide range and increased number of programmes

available, including reality TV shows such as Sommerhaus der Stars, Are You The One – Reality Stars in Love and Temptation Island, and

fictional series such as Sisi, Dünentod, Auris and Pumuckl’s New Adventures. The football match AS Monaco vs. Bayer Leverkusen also

attracted large audiences. The most-watched original documentary was Bushido & Anna-Maria – Alles auf Familie.

In 2023, Vox ranked second among the commercial channels with an average audience share of 6.2 per cent in the target group of viewers

aged 14 to 59 (2022: 6.2 per cent) and a 4.7 per cent total audience share (2022: 4.7 per cent). Furthermore, the channel again ranked third

among the commercial channels in the target group of viewers aged 14 to 49, with an average audience share of 6.7 per cent (2022: 6.7 per

cent). The cooking show Grill den Henssler celebrated its strongest autumn season in five years (7.5 per cent) and the best spring season in

four years (6.9 per cent) in the target group of viewers aged 14 to 59. First Dates Hotel recorded the best season average in prime time in the

14 to 59 target group (7.3 per cent) and First Dates – Ein Tisch für zwei (6.4 per cent) the best average share since its launch. Die Höhle der

Löwen (Dragons’ Den) remained popular, generating the best spring season ever, with an average audience share of 10.2 per cent in the

commercial target group of viewers aged 14 to 59. The documentary Zum Schwarzwälder Hirsch – eine außergewöhnliche Küchencrew und

Tim Mälzer, meanwhile, was watched by 8.5 per cent of the same target group. New records were also generated by Die Beet-Brüder (10.6

per cent) and Die Autodoktoren (10.2 per cent). The new prime-time formats Doc Caro – Jedes Leben zählt (6.6 per cent) and Lege kommt

auf den Geschmack (6.0 per cent) were also successful.

Nitro attracted 2.2 per cent of the 14 to 59 target group (2022: 2.2 per cent) and 3.2 per cent of its main target demographic of men aged 30

to 49 (2022: 3.0 per cent).

The news channel NTV scored a total audience share of 1.1 per cent and attracted 1.2 per cent of viewers aged 14 to 59 (2022: 1.2 per cent and

1.4 per cent).

RTL Up, previously RTL Plus, attained a 2.1 per cent audience share in the target group aged 14 to 59 (2022: 1.9 per cent).

Vox Up generated an audience share of 0.7 per cent in the target group of viewers aged 14 to 59 (2022: 0.6 per cent).

Super RTL retained its leading position in the children’s segment in 2023, attracting an average audience share of 19.7 per cent in the target

group of three to 13-year-olds between 06:00 and 20:15, including Toggo Plus (2022: 17.4 per cent). This placed Super RTL ahead of the public

service broadcaster KiKA (15.0 per cent) and Disney (13.1 per cent).

In 2023, RTL Zwei’s market share was 3.6 per cent among 14 to 59-year-old viewers (2022: 3.7 per cent).

RTL Deutschland’s publishing business continued to be impacted by the challenging market environment, mainly due to increased prices for

paper and energy, alongside increasing inflation due to political challenges. In the latest reach analysis of ma Pressemedien 2024 by

Arbeitsgemeinschaft Media-Analyse e.V. (agma), Stern headed the analysis with 3.88 million readers in 2023 (2022: 3.77 million), clearly

ahead of Der Spiegel (3.60 million) and Focus (3.11 million). According to IVW figures, Stern lost 7.3 per cent in total circulation and 0.7

percentage points in market share compared to 2022 (IVW 2022: 26.4 per cent). Compared to 2022, the women’s magazine Brigitte increased

its total sales by 0.5 per cent in 2023 and was the leading magazine in this segment. Although the circulation of Gala was slightly down by 1.6

per cent compared to 2022, the celebrity magazine increased its market share in retail sales by 1.0 percentage points compared to 2022 (IVW

2022: 20.8 per cent; 2023: 21.83 per cent).

Radio consumption in Germany remained strong in 2023, reaching 74.1 per cent of Germans aged 14+ daily (2022: 74.5 per cent) – with an

average listening time of 242 minutes per day (2022: 249 minutes). RTL Group’s German radio portfolio reached over 55 million Germans

aged 14+ every month (2022: 55 million). 104.6 RTL maintained its market-leading position in the highly competitive Berlin/Brandenburg

radio market in the target group of listeners aged 14 to 49. Many radio stations increased their reach year on year, including Radio Brocken

(up 33.6 per cent among listeners aged 14 to 49), 89.0 RTL (up 10.7 per cent among listeners 14+), Hitradio RTL Sachsen (up 12.9 per cent

among listeners 14+) and Radio 21 (up 15.2 per cent among listeners 14+). The national programme RTL – Deutschlands Hit-Radio now

reaches 541,000 listeners per day (an increase in reach of 12.5 per cent among listeners 14+), and the children’s and family radio Toggo Radio

– the newest member of the RTL family of channels – increased its reach 27.8 per cent among listeners aged 14+.


RTL Group Annual Report 2023


		29

Groupe M6

Financial results

In 2023, the French net TV advertising market was estimated to be down 4 per cent compared to 2022, with Groupe M6 performing in line

with the market. Groupe M6’s total revenue was down by 3.0 per cent to €1,316 million (2022: €1,357 million). The decrease in revenue

was mainly due to scope effects and lower TV advertising revenue. Groupe M6’s Adjusted EBITA was up 2.3 per cent to €311 million

(2022: €304 million), mainly driven by Groupe M6’s diversification businesses partly offset by lower contributions from TV advertising

revenue.

Audience ratings

The audience share of the Groupe M6 family of free-to-air channels in the commercial target group (women under 50 responsible for

purchases) reached 21.9 per cent (2022: 22.3 per cent), thereby representing the second-most watched commercial family of TV channels in

France. In the target group of viewers aged 25 to 49, the combined audience share of Groupe M6 was slightly up to 20.5 per cent (2022: 20.3

per cent). The total audience share was 13.0 per cent (2022: 13.5 per cent). On average, again 23.0 million viewers watched Groupe M6’s free-

to-air channels every day in 2023 (2022: 23.0million).

Flagship channel M6 retained its status as the second-most-watched commercial channel in France in the commercial target group, with an

average audience share of 13.5 per cent (2022: 14.1 per cent), thanks to sports events such as the Women’s FIFA Football World Cup and the

Rugby World Cup. M6 successfully aired all its strong brands such as L’Amour est dans le pré (The Farmer Wants a Wife), Top Chef and La

France a Un Incroyable Talent (Got Talent). At the same time, the channel introduced new favourites such as Les Traîtres (The Traitors) and

continued with the successful show Qui veut être mon associé? (The Apprentice). In 2023, the iconic news magazine Enquête Exclusive

achieved its best-ever season among the commercial target group.

The advertising-financed streaming service 6play recorded 21.3 million active users in 2023 (2022: 24.5 million).

W9 reached an average audience share of 3.7 per cent among women under 50 responsible for purchases (2022: 3.6 per cent), ranking

second among the DTT channels in France in this target group. Reality series, sports, films and magazines continued to score high ratings.

Among the new generation of DTT channels, 6ter achieved an average audience share of 2.7 per cent (2022: 2.7 per cent) with a strong

magazine offer in prime time and a large film offer.

With Gulli, Groupe M6 was the leader among the children’s target group (aged 4 to 10 years) during daytime (06:00 to 20:00), attracting an

average audience share of 13.0 per cent (2022: 12.6 per cent). With the development of its evening offer Gulli Prime, the channel achieved its

best-ever year in prime time among the commercial target group.

In 2023, the RTL radio family of stations registered a consolidated audience share of 17.6 per cent among listeners aged 13 and older (2022:

18.4 per cent). Its flagship station RTL Radio was the leading commercial station in France with an average audience share of 12.2 per cent

(2022: 12.8 per cent). The pop-rock station RTL 2 recorded an average audience share of 2.8 per cent (2022: 3.1 per cent), while Fun Radio

registered an average audience share of 2.6 per cent (2022: 2.5 per cent).

Fremantle

Financial results

Revenue at RTL Group’s content business, Fremantle, was down by 3.5 per cent to €2,266 million in 2023 (2022: €2,347 million), mainly

due to timing effects and negative foreign exchange rate effects, which were partly offset by positive scope effects. The business unit’s

revenue decreased 4.9 per cent organically 22, mainly due to timing effects. Accordingly, Adjusted EBITA declined 14.2 per cent to

€139 million (2022: €162 million).

Entertainment

Within its entertainment business, the 16th season of Britain’s Got Talent won an average total audience share of 34.6 per cent or 5.8 million

viewers, making it ITV1’s number-two entertainment show of the year. Launching on Disney+ in September 2023, Italia’s Got Talent was in the

top ten Disney+ shows each day throughout the month and was the number-one show on Disney+ for 20 days. In the US, the 18th season of

America’s Got Talent launched on 30 May, attaining an average total audience share of 12.3 per cent for the season, ranking as NBC’s

number-two entertainment series of the 2022/23 season. In Spain, the debut series of Got Talent: All Stars launched on Telecinco, winning an

average total audience share of 10.5 per cent and consistently ranking as the broadcaster’s number-one show of the day.

American Idol crowned a new winner in season 21, achieving an average total audience share of 10.6 per cent and ranking as ABC’s top show

of the 2022/23 season. Airing its 20th season in Germany, Deutschland sucht den Superstar attained a 12.6 per cent share in the key

commercial target group of viewers aged 14 to 59, outperforming RTL’s prime-time average, and was renewed for a new season in 2024. The

11th season of Indian Idol won an average total audience share of 2.3 per cent and performed 77 per cent higher than the prime-time average

audience share for Set (India’s number-one Hindi TV channel for reality TV shows and soaps).

The Apprentice was BBC One’s number-two entertainment show of the year. The 17th series won an average total audience share of 30.9 per

cent or 6.3 million viewers.


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22 Adjusted for portfolio changes and at constant exchange rates. Further details can be found in Key performance indicators on page 19

Farmer Wants a Wife launched in the US as Fox’s highest-rated new entertainment show in over a year and has been renewed for a second

season. New to Canada for 2023, the English-language version of Farmer Wants a Wife has significantly outperformed CTV’s prime-time

average audience share.

The third season of The Masked Singer in Sweden achieved an average total audience share of 53.0 per cent, ranking as TV4’s highest-rated

show of the year. In Belgium (Flanders), The Masked Singer was 2023’s number-one show of the year, with an average total audience share of

52.6 per cent on VTM, the leading commercial TV channel in Flanders.

Drama and film

2023 saw multiple new drama launches around the world. East Side from Abot Hameiri in Israel launched on the country’s public channel Kan

11, and Sullivan’s Crossing premiered on Canada’s leading commercial TV network CTV in March, where it was soon commissioned for a

second season. In the US, Sullivan’s Crossing was The CW’s highest-rated acquired drama launch in over a year.

Fremantle US launched Fellow Travelers on Showtime in October 2023 to huge critical acclaim – the series was the 4th most-watched show

on Paramount+ in the US every day in its first week.

The comedy-drama series Wellmania from Fremantle Australia broke into the Top Ten TV series on Netflix in 40 countries, peaking at number

two in Australia and New Zealand. The Gallows Pole from Element Pictures won a total audience share of 9.3 per cent and was BBC Two’s

number-one drama of the year. From Wildside in Italy, The Good Mothers launched on Disney+ after winning the inaugural Series Award at

the 2023 Berlinale. From UFA in Germany, Sam: A Saxon also launched on Disney+ in 48 territories to huge acclaim.

Neighbours returned to a new home on Amazon Freevee. In the first 28 days in the UK, Neighbours became the number-one Freevee Original

and has also driven the most non-Prime customers to the free streaming service.

In Italy, Lux Vide produced three of the most-watched TV series in 2023 for Rai. Sister Angela’s Girls season seven was the third-most-

watched TV series on Rai for 2023, with an average total audience share of 22.8 per cent. The second season of Blanca was the fourth-most-

watched series with an average total audience share of 23.0 per cent, and One Step From Heaven season seven was the fifth-most-watched

series with an average share of 22.6 per cent.

Within the growing film business, C'è ancora domani from Wildside won three awards at the Rome Film Festival and achieved great success

at the Italian box office. With more than 5 million admissions, it became Italy’s number-one and highest-grossing film of the year following its

launch in October 2023. This makes it the fifth-highest-grossing Italian film of all time at the Italian box office.

Fremantle had five films in competition at the 2023 Venice Film Festival, with Poor Things from Element Pictures winning the Golden Lion and

Priscilla from The Apartment Pictures winning the Volpi Cup for Best Actress for lead actress Cailee Spaeny.

Documentaries

In the documentary business, US label Original Productions launched Waco: American Apocalypse on Netflix, which ranked in Netflix’s Top 10

TV series in 13 countries, including the US and the UK, with 43 million hours viewed in the first half of 2023. Original Productions also signed a

first-look deal with Hudlin Entertainment and had the world premiere of their documentary film Rather, about the iconic US journalist Dan

Rather, at the 2023 Tribeca Film Festival.

House of Kardashian from 72 Films launched on Sky Documentaries in October 2023, ranking as Sky Documentaries’ number-four new series

premiere of 2023. 72 Films also launched 007: Road to a Million on Amazon Prime Video. The documentary charted in Prime Video’s daily top

ten shows in 92 countries and number one in 35 countries, including the UK, and was the streaming service’s most-watched unscripted show

in November 2023.

On Disney+, Fremantle Australia launched a new docuseries Matildas: The World at Our Feet, about the national women’s football team.

Fremantle secured the global rights to On the Line: The Richard Williams Story, which had its UK premiere at Sheffield Doc Fest, alongside a

new documentary about French icon Brigitte Bardot, and a series about fashion icon Coco Chanel from Gabriel Jagger’s WhyNow

Productions. Fremantle also revealed its new documentary label, Undeniable, which will focus on producing world-class premium feature

documentaries such as The Second Woman and Devo, which had its world premiere at Sundance Film Festival 2024.


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Other segments

This segment mainly comprises the fully consolidated businesses RTL Hungary, RTL Group’s Luxembourgish activities, RTL Group’s

digital video company We Are Era and the streaming technology company Bedrock. It also includes the investment accounted for using

the equity method, Atresmedia, in Spain.

The Hungarian net TV advertising market was estimated to be up by 7.8 per cent in 2023, with RTL Hungary outperforming the market. Total

revenue of RTL Hungary was up by 10.6 per cent to €125 million (2022: €113 million), thanks to higher TV advertising, distribution and

streaming revenue. The business unit’s Adjusted EBITA was down to €6 million (2022: €13 million), mainly due to higher programme costs.

With a combined prime-time audience share of 28.4 23 per cent in the key demographic of 18 to 49-year-old viewers (2022: 28.9 per cent), the

eight channels of RTL Hungary were 3.2 percentage points behind the main commercial competitor TV2 Group, which has 14 channels. In

December 2023, RTL Hungary added four new cable channels to its portfolio, increasing the number of linear channels it operates to 12. This

represented RTL Hungary’s largest cable channel expansion to date. The Hungarian flagship channel RTL reached a prime-time audience

share of 14.3 per cent among viewers aged 18 to 49 (2022: 15.0 per cent), 1.5 percentage points behind TV2 (2022: 1.1 percentage points ahead

of TV2).The flagship channel was the most-watched channel in Hungary in the months of June, July, August and November, and the channel’s

programmes dominated the national top-ten list of TV programmes in the 18-49 age group. The market-leading news programme RTL Híradó

attracted 20.0 per cent of viewers aged 18 to 49 (2022: 19.6 per cent), while the most successful show on RTL in Hungary was Sztárbox

(Celebrity Boxing), with an average audience share of 30.3 per cent of viewers aged 18 to 49. Another hit format was the Hungarian version of

The Traitors, which reached an average audience share of 23.3 per cent in the commercial target group and was particularly successful with

younger audiences. The hit show Power Couple attracted an average audience share of 23.8 per cent, up 2.6 percentage points (2022: 21.2

per cent).

In November 2022, RTL Hungary launched RTL+, a subscription-based, advertising-free streaming service. RTL Hungary’s previous

advertising-funded streaming service, RTL Most, and the advertising and distribution-funded streaming service, RTL Most+, were integrated

under the packages RTL+ Light and RTL+ Active. RTL+ and RTL+ Active saw strong growth in paying subscribers compared to the end of

December 2022. The 11th season of the reality format ValóVilág powered by Big Brother, Drága örökösök (Dear Heirs – The Return) and RTL

Hungary's own-produced comedy series A mi kis falunk (Our Little Village) were among the most-watched programmes. In 2023, RTL

Hungary added 105 new titles and 555 hours of new content to its streaming service RTL+.

In 2023, RTL Luxembourg continued its position as the leading media brand in Luxembourg. The company adopted the unified RTL brand

identity across all channels and platforms as of April 2023. The implementation was accompanied by a comprehensive marketing campaign,

focusing on RTL’s core values and catering to Luxembourg’s multilingual audience with the slogans 'All Moment RTL’, ’Every moment RTL’

and ‘Les moments RTL’.

With its TV, streaming, radio and digital activities, the RTL Luxembourg media family achieved several audience successes 24. Audience

highlights of 2023 were the coverage of the country’s general election on its TV channel RTL Télé Lëtzebuerg, its radio channels Radio

Luxembourg and RTL Today, as well as on its website rtl.lu. Sport highlights of 2023 included the broadcast of the Uefa Champions League

and the Uefa European Qualifiers. In November 2023, RTL Luxembourg announced that it will continue to broadcast Formula One races for

the next three seasons, until 2026, to further strengthen its sports offering.

In 2023, Broadcasting Center Europe (BCE), RTL Group’s technical services provider, launched its media-as-a-service offer: a one-stop

shop for customers to build a customised set of media solutions, products and services. With this offer, BCE aims to support customers as a

trusted partner – and realised diverse projects in this capacity during 2023. For L’Equipe, BCE used its award-winning remote voice-over

solution Holovox for commentary at events such as the Basketball Euroleague. Holovox was used by 220 customers at 39 different sports

events for a total of 6,425 hours during 2023. For RTL Hungary, BCE provided its Playit technology for the launch of four new cable channels.

For Louis Vuitton, BCE’s technology was used to livestream the Hong Kong fashion show to 93 million viewers. And for Groupe Figaro, BCE

used its integration and service expertise to install a production centre and broadcast its TV channel from Luxembourg.

In 2023, We Are Era further strengthened its leading positions in talent management and content production, alongside expanding its

campaign business with new clients such as Deutsche Telekom and Sixt. In 2023, We Are Era developed its data-driven cultural and

community marketing business on ‘new’ social platforms such as Twitch for customers such as Teekanne Deutschland or Vodafone Stiftung.

We Are Era’s revenue was stable in 2023.

The Spanish net TV advertising market increased by an estimated 2.9 per cent in 2023. On a 100 per cent basis, consolidated revenue of

Atresmedia was slightly up by 2.1 per cent to €971 million (2022: €951 million), while operating profit (EBITDA) remained stable at €173

million (2022: €173 million), and net profit was €171 million (2022: €113 million). The strong increase in net profit was primarily due to lower

income tax expenses due to the recognition of unused tax credits. The profit share of RTL Group was €32 million (2022: €21 million).


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23 RTL Hungary changed the publication of its audience figures from 2022 and is now using ‘Linear SHR’ audience share data, which is calculated without the ‘Other’ category of Nielsen

24 Luxembourg’s market research institute ILRES did not publish its Plurimédia audience results for 2023. Therefore, there are no audience shares for RTL Luxembourg’s TV and radio stations

available for 2023

The Atresmedia family of channels achieved a combined audience share of 25.7 per cent in the commercial target group of viewers aged 25

to 59 (2022: 26.4 per cent). The main channel, Antena 3, recorded an audience share of 10.6 per cent (2022: 11.5 per cent) in the commercial

target group.

For more information on investments in associates, see note 6.5.2 to the consolidated financial statements in the RTL Group Annual Report

2023.


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		33

Non-financial information

Corporate responsibility (CR)

RTL Group believes that CR adds value not only to the societies and communities it serves, but also to the Group and its businesses. Acting

responsibly and sustainably enhances the Group’s ability to remain successful in the future.

CR is integral to the Group’s strategy. The core RTL brand was repositioned in 2021 with a new identity, a clear set of brand principles and a

new design reflecting the diversity of RTL. With this, RTL has been strengthened as Europe’s leading entertainment brand that stands for

entertainment and independent journalism, as well as inspiration, energy and attitude. ‘We act responsibly’ is one of eight defined brand

principles that guide the company’s action and define what RTL stands for. At the heart of RTL’s guiding principles and values is a

commitment to embracing independence and diversity in its people, content and businesses.

RTL Group’s future non-financial reporting

In December 2022, the Corporate Sustainability Reporting Directive (CSRD) was adopted by the European Parliament and came into force on

5 January 2023. The new directive aims to expand existing requirements for non-financial reporting. As a large listed Public Interest Entity

(PIE), the reporting requirements of the CSRD will also apply to RTL Group starting from the financial year 2024. RTL Group will publish its

non-financial reporting as part of its Annual Report 2024.

Companies subject to the CSRD must report according to European Sustainability Reporting Standards (ESRS), and the sustainability

information reported must be audited.

To prepare for the implementation of the CSRD and ESRS, RTL Group’s Corporate Centre has established a working group under the

leadership of its CFO, comprising experts from HR, Legal, Finance/Consolidation, Communications & Investor Relations, Compliance, Audit

and IT. These experts are in close contact with their counterparts at the Group’s business units, the Group’s external auditors and

Bertelsmann. By the end of 2023, RTL Group’s CSRD working group finalised the preparation of the Group’s materiality assessment and

therefore determined the scope and depth of RTL Group’s future non-financial reporting. The double materiality assessment, as stipulated by

the CSRD, refers to two dimensions: financial materiality requires disclosure of matters that (may) trigger material financial effects on a

company’s development, such as cash flows, financial position or financial performance, in the short, medium or long term. Impact materiality

requires disclosure of matters relating to effects on people or the environment. Assessments of both dimensions are required for all

companies. So far, RTL Group has determined a total of 59 material metrics across the areas ‘environmental’, ‘social’ and ‘governance’. In

2024, the Group will begin drafting the first report in accordance with ESRS. This process includes a test run in the first half of 2024 for all S-

related metrics determined as material.

RTL Group’s current non-financial reporting

The information of the Combined Non-Financial Statement (which complies with the current European Directive 2014/95/EU and provisions

by the law of 23 July 2016 regarding the publication of non-financial and diversity information in Luxembourg) can be found in the Annual

Report of RTL Group’s majority shareholder, Bertelsmann SE & Co KGaA. Further information on RTL Group’s non-financial information can

also be found in the GRI reporting of Bertelsmann SE & Co KGaA on bertelsmann.com.

RTL Group’s CR organisation

The RTL CR Board unites executives from RTL Group and RTL Deutschland. The Board meets regularly to coordinate projects in key areas

such as diversity, creative/editorial independence and climate protection, to develop new ideas and to ensure efficient use of expertise at

both the Corporate Centre and RTL Deutschland.

The CR Board also meets annually with participants from specialist departments within RTL Deutschland, such as Youth Protection, the

association Stiftung RTL – Wir helfen Kindern, Communications, and RTL Group’s Human Resources, Investor Relations and Compliance

departments. The RTL Group CR Network – created in March 2014 and consisting of CR representatives from the Group and its business units

– meets annually to share best practices and knowledge. In addition, RTL Group established a Climate Task Force, consisting of members

from all business units, which meets to discuss, collaborate and define actions to reduce carbon dioxide emissions, with the target of

becoming climate neutral by 2030. In May 2022, RTL Group’s largest business unit, RTL Deutschland, established a department for

sustainability and diversity, equity & inclusion (DEI). In 2023, Fremantle established ten employee-led groups focusing on topics like mental

health and wellbeing, accessibility, as well as race and ethnicity, which are sponsored by the executive leadership and directly influence

decision-making.

RTL Group’s CR activities focus primarily on the following issues: content responsibility, creative/editorial independence and freedom of

expression, intellectual property and copyright, fair working conditions, DEI, health, safety and wellbeing, learning (including digital media

literacy) and climate change. These issues were identified in a materiality analysis in consultation with internal and external stakeholders.

The core of the survey was the assessment of 19 CR topics – internally, according to their relevance for the business, and externally,

according to their relevance for stakeholders. The survey was conducted in 2020 in close consultation with the Group’s majority shareholder

Bertelsmann. Going forward, the double materiality assessment under ESRS will replace the survey.


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Relevance matrix

1 The different environmental topics have been pooled

2 Including digital media literacy

Creative/editorial independence

RTL Group’s broadcasting and news reporting are founded on editorial and journalistic independence. RTL Group’s commitment to

impartiality, responsibility and other core journalistic principles is articulated in its Newsroom Guidelines. Maintaining audience trust has

become even more important in an era when news organisations and tech platforms have been accused of publishing misleading stories, and

when individuals, radical political movements and even hostile powers post fake news on social networks to sow discord.

For RTL Group, independence means being able to provide news and information without compromising its journalistic principles and

balanced position. Local CEOs act as publishers and are not involved in producing content. In each news organisation, editors-in-chief apply

rigorous ethical standards and ensure compliance with local guidelines, which gives the Group’s journalists the freedom to express a range of

opinions, reflecting society’s diversity and supporting democracy. In 2023, RTL Deutschland reviewed the guidelines that RTL News has been

working with and incorporated new requirements on cross-media production, social media activities by journalists and Artificial Intelligence

(AI). With these updated guidelines, RTL Deutschland ensures that all employees have the same understanding of the quality of journalistic

work, regardless of their work area, TV, digital and print.

Employees

With a diverse audience and a business based on creativity, RTL Group needs to be a diverse organisation. In 2023, the Group had an average

of 12,835 full-time employees (total headcount: 17,732 including permanent and temporary staff) in more than 26 countries worldwide. These

employees range from producers and finance professionals to journalists and digital technology experts.

RTL Group strives to be an employer of choice that attracts and retains the best talent, while equipping employees with the necessary skills

and competencies to successfully master the company’s current and future challenges. It does this by offering training programmes and

individual coaching in a wide range of subjects, from strategy and leadership to digital skills and health, safety and wellbeing. It reviews and, if

necessary, adjusts its training offers on an ongoing basis.

RTL Group’s corporate culture is founded on creativity and entrepreneurship. The Group strives to ensure that all employees receive fair

recognition, treatment and opportunities, and is committed to fair and gender-blind pay. The same applies to the remuneration of freelancers

and temporary staff, ensuring that such employment relationships do not compromise or circumvent employee rights. The Group also strives

to support flexible-working arrangements.

The Covid-19 crisis has deeply changed the world of work. The balance between working in the office and remotely is a relevant step to

continue offering flexibility and efficiency for those employees whose functions do not require office presence.


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Every two years, all RTL employees are invited to participate in the Bertelsmann employee survey. In 2023, RTL Group received a response

rate of 76.4 per cent, corresponding to 9,541 respondents from 134 companies across 22 countries and in 11 languages (excluding temporary

workers and Groupe M6). The survey delivered positive feedback across various important dimensions, including CR-related topics.

Employees feel that their manager treats them with respect (highest overall satisfaction rate of 93 per cent), assigns them independent tasks

(89 per cent) and supports them through challenges (87 per cent). Areas for improvement include total compensation received (40 per cent),

support for professional development (54 per cent), and commitment to protecting the environment and climate (62 per cent) – all of which

are important feedback points that RTL Group takes seriously. Since 2021, the employee survey includes a CR Index, summarised in the

following graphic, to help track the progress of RTL Group-wide CR initiatives. The next employee survey will be conducted in 2025.

Employee survey 20231: CR Index at 74 per cent – Target: 80 per cent

1 Calculation based on the average of positive responses to seven questions of the 2023 Employee Survey in the following categories: Health & wellbeing; Diversity, Equity & Inclusion; Fair working

conditions; Learning; Climate change

Diversity

RTL Group’s commitment to diversity is embedded in its processes and articulated in its corporate principles. The cornerstone is the RTL

Group Diversity Statement, which reinforces the company’s commitment to promoting diversity and ensuring equal opportunities. It sets

guidelines and qualitative ambitions for the diversity of the Group’s people, content and businesses.

RTL Group is committed to making every level of the organisation more diverse regarding nationality, gender, age, ethnicity, religion and

socio-economic background. The Group places a special emphasis on gender diversity. RTL Group’s overall workforce is balanced by gender

(with 47 per cent men and 53 per cent women as at 31 December 2023) while women account for 36 per cent of top management positions

(31 December 2022: 36 per cent), and 37 per cent of senior management positions (31 December 2022: 33 per cent).

Top management generally encompasses the members of the Executive Committee, the CEOs of the business units and their direct reports,

members of the Management Boards, and the Executive Committee direct reports at RTL Group’s Corporate Centre. Senior management

generally encompasses the Managing Directors of the businesses at each business unit, the heads of the business units’ departments and the

Senior Vice Presidents at RTL Group’s Corporate Centre (unless classified as members of top management).

RTL Group’s long-term ambition is for women and men to be represented equally at all levels. In 2022, RTL Group’s Executive Committee

reviewed the Group’s objectives and set the following quantitative target: to increase the share of women in top and senior management

positions to at least 40 per cent by the end of 2025. The Group reports on its progress towards these diversity targets each year. At the end of

2023, the ratio of women in top and senior management positions was 37 per cent, up 17 percentage points compared to 2016, when RTL

Group reported those measures for the first time (2016: 20 per cent; 2022: 34 per cent).

The importance of diversity is also reflected in the content the Group produces. Millions of people who turn to RTL Group each day for the

latest local, national and international news need a source they can trust. RTL Group therefore maintains a journalistic balance that reflects

the diverse opinions of the societies it serves. The same commitment to diversity applies to the Group’s entertainment programming: it is

essential for RTL Group to create formats for a wide range of audiences across all platforms. Many different segments of society should be

able to identify with the diverse content offered.


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In Germany, RTL Deutschland initiated its second diversity week (Woche der Vielfalt) with a focus on inclusion. During this week, RTL

Deutschland reported extensively on its news and magazine programmes to increase visibility of people with disabilities. A highlight from the

week was coverage of the Special Olympic World Games, one of the world’s largest inclusive sporting events, which took place in Berlin in

June 2023. RTL Deutschland was a partner of the Games’ media alliance. A marketing campaign on TV, digital, radio and social media

accompanied the theme week, bringing people with disabilities together with well-known RTL faces. RTL Deutschland’s flagship channel RTL

and Vox broadcasted special formats like Der Schwarzwälder Hirsch – Ein Jahr danach (Zum Schwarzwälder Hirsch – One year later), a

reunion of the Grimme Award-winning inclusive TV documentary in which people with Down syndrome learn how to run a restaurant.

Since 2020, RTL Deutschland has supported the ‘Storytellers’ competition, in which students from selected film schools are invited to develop

and submit a concept for a young-adult series for RTL+. The first winning project of the competition already premiered as an RTL+ original in

2022, while winners of the 2023 edition will realise their projects in 2024. The competition is now supported by the Film- and Medienstiftung

Nordrhein-Westfalen (NRW), a leading German funding institution supporting the development of film and TV projects in NRW. In the future,

‘Storytellers’ will offer a production budget of up to €1.5 million, opening up new possibilities in production.

In 2023, Fremantle continued to make progress towards building an equitable and inclusive culture across its business and content. To

attract, develop and retain talent from all backgrounds and experiences, Fremantle has invested in partnerships with specialist organisations

dedicated to addressing under-representation in the creative industries. For example, Fremantle continued its partnership with The TV

Collective on the Breakthrough Leaders programme in the UK, supporting 150 black, Asian and minority-ethnic future leaders. In Sweden,

Fremantle’s leadership team is participating in an external mentoring programme, All of Us, for young people of colour in the creative

industries and supporting the WomenUp programme – which consists of 40 women and their mentors – to address the female leadership

gap. In the US, a partnership with Fresh Films supports 400 young people from under-represented backgrounds based in 27 national

locations nationwide.

Inclusive casting and storylines across Fremantle shows continued to provide a platform for different voices and perspectives, influence

authentic storytelling, and promote empathy and understanding. The series Sam – A Saxon, from Fremantle label Big Window Productions,

launched on Disney+ and was recommended by the German Federal Government to be included in the school’s national curriculum. The

creative team also embarked on a global educational tour across several US states, London and Berlin, hosted by some of the world’s leading

academic and cultural institutions to help highlight the positive impact the series has had on the Afro-German and Black communities. In

October 2023, the release of the Italian drama film C'è ancora domani (There's Still Tomorrow) achieved over five million admissions, leading

the box office yearly results for an Italian film. The film, which is set in Rome during the aftermath of World War II, deals with issues related to

domestic violence, patriarchy and feminism. Alongside its commercial success, C'è ancora domani has also become important in the

education of students across Italy. Italian cinemas screened the film to students across the country, and the government requested that

schools dedicate time and resources to the topic of domestic violence.

The Fremantle series Fellow Travelers – a love story and political thriller about two men who meet during the McCarthy era, when being gay

meant being in danger – pays tribute to the history of the LGBTIQ+ community and received lots of media attention. Launched in 2023, the

series highlights the importance of striving for a more inclusive society. It received two Golden Globe nominations in 2024 and won the Critics’

Choice Award for ‘Best Supporting Actor in a Limited Series or Movie Made for Television’ for Jonathan Bailey.

Society

As a leading media organisation and broadcaster, RTL Group has social responsibilities towards the communities and audiences it serves.

These responsibilities are particularly important when it comes to children and young people. The Group complies fully with child-protection

laws and ensures its programming is suitable for children – or broadcast when they are unlikely to be watching. RTL Group also strives to give

back to its communities by using its profile to raise awareness of, and funds for, important social issues, particularly those that might

otherwise receive less coverage or funding.

As part of this support, the Group provides free airtime worth several million Euro to charities and non-profit organisations to help them raise

awareness of their causes, as well as donating significant amounts of money to numerous charitable initiatives and foundations. RTL Group’s

flagship fundraising events (RTL-Spendenmarathon/Stiftung RTL in Germany and Télévie in Luxembourg) raised €23.3 million for charity in

2023 (2022: €46.0 million, driven by an additional fundraising campaign from Stiftung RTL in Germany for Ukrainian children and families

after Russia’s attack on Ukraine in February 2022).

Intellectual property and copyright

RTL Group’s primary mission is to invest in high-quality entertainment programmes, fiction, drama, news and sports, and to attract new

creative talent to help the Group contribute to a vibrant, creative, innovative and diverse media landscape. Strong intellectual property rights

are the foundation of RTL Group’s business, and that of creators and rights-holders.

RTL Group’s Code of Conduct and an Information Security Policy set a high standard for the protection of intellectual property. All employees

are expected to comply with copyright laws and licensing agreements and to put in place appropriate security practices (password

protection, approved technology and licensed software) to protect intellectual property. Sharing, downloading or exchanging copyrighted

files without appropriate permission is prohibited. Violations can be reported to the Compliance department via its reporting channels, which

include a user-friendly speak-up system.

Anti-corruption and anti-bribery

The foundation for sustainable business success is built on integrity and trustworthiness, and RTL Group has zero tolerance for any form of

illegal or unethical conduct. Violating laws and regulations – including those relating to bribery and corruption – is not consistent with RTL

Group’s values and could damage the Group. Non-compliance could harm the Group’s reputation, result in significant fines, endanger its

business success and expose its people to criminal or civil prosecution.


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The Compliance department provides Group-wide support on anti-corruption, anti-bribery and other compliance-related matters. In addition

to centralised management by the Compliance department, each business unit has a Compliance Responsible in charge of addressing

compliance issues, including anti-corruption.

For information about RTL Group’s Audit Committee see pages 44 to 45.

Representatives of RTL Group management sit on the RTL Group Corporate Compliance Committee. The committee, which is chaired by RTL

Group’s Chief Financial Officer, is responsible for monitoring compliance activities, promoting ethical conduct and fighting corruption and

bribery. It is kept informed about ongoing compliance cases and the measures taken to prevent compliance violations.

The RTL Group Anti-Corruption and Integrity Policy is the Group’s principal policy for fighting corruption. It outlines rules and procedures for

conducting business in accordance with anti-corruption laws and Group principles.

RTL Group’s policies, including anti-corruption and integrity, anti-trust and compliance organisation, were updated and streamlined in 2022.

The policies are split into ten categories, with a Business Process Owner for each category, who is the main contact for any questions

regarding the respective policy.

Human rights

Respect for human rights is a vital part of RTL Group’s Code of Conduct, which includes a decision-making guide that clarifies how to comply

with the company’s standards in case of doubt. The Group’s commitment to responsible and ethical business practices extends to its

business partners. In 2017, RTL Group established the RTL Group Business Partner Principles, which sets minimum standards for responsible

business relationships. In 2023, RTL Group’s Executive Committee adopted RTL Group’s Supplier Code of Conduct, that will be rolled out and

will replace the Business Partner Principles in 2024. To cover all centrally important aspects of human rights in one place, RTL Group

published a specific Human Rights statement in 2022. The statement explicitly refers to the standards of the Universal Declaration of Human

Rights and the United Nations’ Global Compact and applies to the entire Group. To report suspected human-rights violations or unethical

practices, employees and third parties can contact RTL Group’s compliance reporting channels (directly or through a web-based reporting

platform) or an independent ombudsperson. In all cases, they may do so anonymously.

Environment

RTL Group is a media company with no industrial operations and therefore does not consume significant amounts of raw materials or fossil

fuel and is not a major polluter. The Group is mindful that resource conservation and climate protection are key challenges for the 21st

century. For this reason – together with employees and stakeholders – RTL Group is committed to minimising its impact on the environment,

by reducing its energy use and its direct and indirect greenhouse gas (GHG) emissions. It codified this commitment in February 2018 by

issuing its Environmental Statement.

RTL Group has measured and published its carbon footprint since 2008. Serving as the key indicator for evaluating and continually improving

the Group’s climate performance, it was formerly calculated based on each country’s average energy mix. To improve data quality, since 2017

it has been calculated based on the emissions associated with the Group’s individual electricity supply contracts. This new, more detailed

baseline takes into account hotel stays, refrigerant losses, commuting, IT devices and own and commissioned productions, as well as

electricity consumption, paper, business travel, water and wastewater.

RTL Group decided to become carbon neutral by 2030, including both company-related emissions (scope 1 and 2) and emissions from the

production of its programmes and products (scope 3). The goal is to reduce the Group’s total emissions by more than 50 per cent compared

to the 2018 baseline. As of 2030, RTL Group will offset all remaining emissions.

The 2018 baseline is the basis against which RTL Group measures progress and target achievements. This basis includes site- and employee-

related emissions (scope 1 and 2) and indirect carbon dioxide emissions from video production (scope 3). Compared to the base year 2018,

RTL Group has reduced its total emissions by 28 per cent, from 247,900 tCO2 in 2018 to 178,900 tCO2 in 2022. Representing almost 80 per

cent of the Group’s total emissions, indirect emissions from video production (scope 3) make up the largest share and are therefore the

greatest lever for achieving the Group’s goal. RTL Group will focus on reducing these emissions in the future, particularly in the area of green

productions.

Due to the lack of data and the complexity of TV and film productions, carbon data for video productions for corporate reporting purposes are

currently calculated based on genre benchmarks derived from the UK carbon calculator Albert. RTL Group will introduce a new Group-wide

policy to base its future reporting of emissions from video productions mainly on activity data.

To reduce carbon emissions, RTL Deutschland has been striving for more sustainable TV productions since 2020. Since mid-2022, minimum

ecological standards adopted throughout the industry by broadcasters and production companies in Germany have been applied to selected

productions. RTL Deutschland aims to produce 50 per cent of its fictional content according to those standards. These standards are used to

strive for environmentally and resource-friendly production methods. In 2023, 20 productions meeting those standards were produced. One

series, that was also certified with the green motion label, was Pumuckl’s New Adventures. On average, around 50 per cent of emissions were

saved (compared to a genre-specific baseline) across 20 productions. RTL Deutschland plans to produce 50 productions meeting those

standards in 2024 25. With the acquisition of Gruner+Jahr in 2022, the carbon footprint of print products also plays an important role. By

setting up a ‘Green Productions Print’ committee, RTL Deutschland is now working on a structured approach to decrease the product carbon

footprint of its magazines.

In France, Top Chef, which has been broadcast on Groupe M6’s channels since 2010, was the first prime-time entertainment programme in

France to receive an Ecoprod Label in 2023. The label is an important recognition of the work and commitment towards sustainable


RTL Group Annual Report 2023


		38

25 The ‘Green Shooting’ working group, founded and led by MFG Filmförderung in 2017, is working on the transformation towards a more ecologically sustainable production method. The working

group includes the production companies Bavaria Fiction, Constantin, UFA, We Are Era and Ziegler Film, the broadcasters ARD, RTL Deutschland, ProSiebenSat1, Sky, SWR and ZDF, the streaming

services Disney+ and Netflix and further industry associations.

production practices of Studio 89, a subsidiary of Groupe M6. In February 2023, the channels and platforms of Groupe M6 raised awareness

of climate change issues during the campaign week ‘Semaine Green’ (Green Week), offering a wide range of news and entertainment

programmes focusing on topics such as waste, housing, biodiversity and responsible consumption.

In February 2023, Ufa, a German production company owned by Fremantle, won the Eisvogel prize for Sustainable Film Production with its

series Irgendwas mit Medien – a prize introduced by the German Federal Government to promote more sustainable productions of

audiovisual content. In May 2023, the daily series Unter uns was the second Ufa production to earn a green motion label from the Green

Shooting working group. Some of the green measures implemented by Ufa include the use of electric cars, generators powered by green

electricity, digital instead of printed filming plans, and reusable and recyclable materials. The company has not used plastic bottles on set

since 2017 and switched to green electricity for productions in 2020. Unter uns is Germany‘s second-longest-running daily soap opera and

the first daily series to be awarded a green motion label.

In May 2023, The Farm, produced by Fremantle-owned Strix in Norway, won the Best Sustainable Production Award at the Inaugural Global

Production Awards in Cannes.

For RTL Group’s environmental indicators according to GRI standards, please visit rtl.com.


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		39

Innovation

Innovation at RTL Group focuses on three core topics: continuously developing new, high-quality TV formats; using all digital distribution

channels; and better monetisation of the Group’s audience reach using personalisation, recommendations and the addressing of target

groups increasingly via artificial intelligence (AI).

In December 2023, Groupe M6 launched the new adventure reality format Destination X on M6 in France. In addition to the new format, which

originates from Belgium, Groupe M6 has also launched a digital interactive platform on 6play.fr and the 6play app to allow audiences to

actively participate in the adventure. UFA Serial Drama, part of Fremantle, produced Der kleine Unter uns Weihnachtsfilm (The little ‘Among

us’ Christmas film) with the help of AI for content, language and visualisations. In the short film, AI was used to create a storyline inspired by

Charles Dickens’ A Christmas Carol.

In August 2023, RTL Deutschland launched Germany’s first all-inclusive entertainment app. Comprising video, music, podcasts, radio,

audiobooks and digital magazines, RTL+ is a unique selling proposition in the German-speaking market. The service’s innovative

recommendation algorithm, based on intelligent text, audio and video analysis, ensures that users are offered personalised content

suggestions across all media types. RTL Deutschland is also investing in its publishing business, in particular the development of digital paid

offer Stern+.

Another innovative focus point is addressable TV advertising, which combines the broad reach of linear TV with targeted digital advertising.

RTL Group continuously develops its advertising technologies or acquires the necessary technology in this area. RTL Group’s European ad-

tech business Smartclip has launched technology to substitute the advertising breaks in linear TV streams with addressable TV (ATV)

advertising, while ensuring an uninterrupted viewing experience for the audience. This innovative technology was first implemented on RTL

Up, and since May 2023, the ad replacement technology in the linear TV stream is available for programmatic buying on the German market.

In addition, Smartclip's French subsidiary Realytics has introduced BEE (Brand Exposure Engagement) in April 2023. BEE measures and

compares spot exposure from the first second across all major distribution channels (linear TV, ATV and CTV). The tool also detects

duplicates and avoids measuring the same household as an individual contact – even if the household is addressed on both linear and digital

channels.

The Group’s advertising sales houses continue to introduce innovative and award-winning advertising formats. In Germany, Ad Alliance

launched CrossOver Evolution – a large-scale innovation project in the area of cross-channel marketing. With the xMedia spot launched in

May 2023, advertisers in Germany can book spots for ATV, connected TV (CTV), desktop, tablets and smartphones in one place. The new

product bundles the entire video inventory of Ad Alliance’s portfolio, while reducing the complexity of booking and managing ads. In addition,

Ad Alliance is increasingly using artificial intelligence (AI) technology internally to increase the efficiency of its pricing processes. Externally,

AI is used in multi-award-winning video tagging to play ads with exactly the right message or at the right emotional moment. In France, M6

Publicité, the advertising sales house from Groupe M6, has developed 6scan range – an engaging and immersive advertising solution based

on the QR code. A QR code is added to the advertiser’s TV advert, providing viewers with additional information or a call-to-action – such as

an augmented reality projection, or the opportunity to interact with chatbots.

AI was a significant driver in RTL Group’s innovative projects in 2023. In July 2023, RTL Deutschland bundled its various AI activities together

in a newly founded AI Circle. The group focuses on five strategically relevant value levers: strengthening content, optimising advertising

sales, engagement and discovery, increasing efficiency, and risk minimisation and innovation. In 2023, AI was applied prominently in the

production of a new series based on the classic German children's series Pumuckl. The original voice of the red-haired goblin, Hans Clarin

(who died in 2005), was recreated using AI for the series Pumuckl’s New Adventures. AI technology has also been used by RTL News to

develop synthetic voices, making it possible to transform written text into natural-sounding speech. In France, Groupe M6 has embarked on a

24/7 transcription initiative for its radio content. Transforming audio content into text enables the team to create more content, easily edit it

in the CMS, and generate new editorial products, summaries, metadata, tags and even legal reports. The transcription initiative not only

streamlines the content creation process, but also paves the way for more dynamic and diversified digital content offerings in the near future.

Fremantle is also increasingly relying on AI, for example with upscaling old video from the 70s-80s by using AI to interpolate the pixels.

Fremantle also uses graphics generation tools like Midjourney or Dall-E to create pitch documents and reimage creative ideas.

Significant litigations

Provisions for litigations correspond to the Group’s best estimate of the expected future cash outflow related to disputes arising from the

Group’s activities (see notes 6.5.2 and 6.14.1 to the consolidated financial statements in the RTL Group Annual Report 2023).

RTL Group is party to legal proceedings in the normal course of its business, both as defendant and claimant. The main legal proceedings to

which RTL Group is a party are disclosed below.

Several subsidiaries of RTL Group are being sued by the broadcaster RTL 2 Fernsehen GmbH & Co KG and its sales house, El Cartel Media

GmbH & Co KG, before the regional court in Düsseldorf, Germany, seeking disclosure of information to substantiate a possible claim for

damages. The proceedings follow the imposition of a fine in 2007 by the German Federal Cartel Office for abuse of market dominance with

regard to discount scheme agreements (share deals) granted by Ad Alliance GmbH (formerly IP Deutschland GmbH) and SevenOne Media

GmbH to media agencies. The German Federal Cartel Office argued that these discounts would foreclose small broadcasters from the

advertising market. In 2014, the regional court of Düsseldorf decided to order an expert report. The expert concluded in February 2018 that the

likelihood of damages cannot be proven with certainty. In July 2018, RTL 2 Fernsehen GmbH & Co KG filed a motion claiming that the expert

was not impartial, with the aim of getting the court to obtain a new expert opinion. Ad Alliance GmbH has rejected the motion of lack of

impartiality as unfounded. Due to his unexpected death in February 2020, the court expert could not submit his response to the allegation of

impartiality. On 4 September 2023, the regional court rendered two decisions: First, it rejected the allegation of the expert’s impartiality.


RTL Group Annual Report 2023


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Second, it dismissed the claims for disclosure of information in their entirety. On 16 October 2023, RTL 2 Fernsehen GmbH & Co KG and El

Cartel Media appealed the regional court’s decisions. The case will now continue before the Düsseldorf Appeal Court. A hearing has been

scheduled for September 2024. Similar proceedings from other small broadcasters, initiated in different courts, were unsuccessful or have

been withdrawn.

In June 2016, the main competitors of Fun Radio alleged that a host of the morning show had influenced Fun Radio’s results by encouraging

his listeners to give favourable treatment to Fun Radio in the Médiamétrie surveys. In response to these allegations, Médiamétrie decided to

remove Fun Radio from its surveys. Following a legal procedure initiated by Fun Radio, Médiamétrie was required to reinstate Fun Radio in the

audience results surveys as of September 2016. Nevertheless, Médiamétrie decided to lower Fun Radio’s audience results in its published

surveys, alleging the existence of a ‘halo effect’. Following a procedure initiated by Fun Radio, a judicial expert was appointed in December

2017 to examine Médiamétrie’s assessment of the alleged ‘halo effect’. In September 2019, the judicial expert issued his final report which

confirmed the ‘halo effect’ but assessed that Fun Radio’s results were over-corrected. As of September 2017, Médiamétrie has again

published the full audience results for Fun Radio. In parallel to the above procedure, the main competitors of Fun Radio also filed, in

December 2016, a claim for damages, before the Paris Commercial Court claiming unfair competition, but this procedure was suspended

until the end of the judicial expertise. In the meantime, four of the six claimants withdrew their claim from the proceedings. On 23 January

2023, the Paris Commercial Court decided to award damages for unfair competition. Fun Radio appealed the Court’s decision on 26 January

2023 and is confident to achieve a favourable decision before the Court of appeal.

In November 2019, the Spanish Competition Authority (CNMC) arrived at a decision in disciplinary proceedings imposing a fine on

Atresmedia and Mediaset and barring both operators from specified courses of conduct. The parties were ordered to take steps to align their

commercial and contractual relations to the requirements of the decision. The fine imposed on Atresmedia amounts to €38.2 million. In 2020,

Atresmedia challenged the decision by filing an application for judicial review with the Administrative Chamber of the Audiencia Nacional,

Spain’s national court. The application was found admissible. Consequently, Atresmedia will proceed with an appeal in the aforementioned

court. The directors and legal advisors of Atresmedia believe that the application for judicial review against the CNMC’s decision is likely to

succeed.

No further information is disclosed as it may harm the Group’s position.


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		41

Corporate governance

Principal risks and uncertainties

Principal risks and uncertainties are disclosed in note 7 to the consolidated financial statements for the risks linked to financial instruments,

and in the Corporate Governance section on rtl.com for the external and market risks.

Corporate governance statement

The RTL Group Board of Directors is committed to high standards of corporate governance. RTL Group has applied the principles of good

governance for years, even before the Ten Principles of Corporate Governance were implemented by the Luxembourg Stock Exchange –

principles that RTL Group is in line with and submitted to.

More information on this topic can be found in the Investor Relations section on rtl.com, which contains RTL Group’s corporate governance

charter, and regularly updated information, such as the latest version of the company’s governance documents (including articles of

incorporation, statutory accounts, and minutes of shareholders’ meetings), and information on the composition and mission of the RTL Group

Board of Directors and its committees. The Investors section also contains the financial calendar and other information that may be of

interest to shareholders.

Shareholders

RTL Group’s current share capital is set at €191,845,074 divided into 154,742,806 fully paid-up shares with no par value.

As at 31 December 2023, Bertelsmann held 76.28 per cent of RTL Group shares, and 23.72 per cent were publicly traded.

General Meetings of Shareholders will be held at the registered office or any other place in Luxembourg indicated in the convening notice. A

General Meeting of Shareholders must be convened on the request of one or more shareholders who together represent at least one tenth of

the company’s capital, and the Annual General Meeting of Shareholders is held within six months following the end of the financial year at the

place and on the date set by the Board of Directors.

Resolutions will be adopted by the simple majority of valid votes, excluding abstentions. Any resolution amending the Articles of

Incorporation will be adopted by a majority of two thirds of the votes of all the shares present or represented.

The Annual General Meeting will examine the reports of the Board of Directors and the auditor and, if thought fit, will approve the annual

accounts. The meeting will also determine the allocation of profit and decide on the discharge of the directors and the auditor from any

duties.

Board and management

Board of Directors

The Board of Directors has the most extensive powers to take, in the interests of the company, all acts of administration and of disposal, that

are not reserved by law or the Article of Incorporation to the General Meeting of Shareholders.

On 31 December 2023, the Board of RTL Group had 12 members: two executive directors and ten non-executive directors. Bettina Wulf

resigned as a non-executive director with effect on 26 April 2023. At the Annual General Meeting (AGM) on 26 April 2023, Carsten Coesfeld

and Alexander von Torklus were appointed as non-executive directors, with a term of office of one year expiring at the end of the Annual

General Meeting of shareholders ruling on the 2023 accounts.

Among the non-executive directors, Pernille Erenbjerg, Jean-Louis Schiltz, Martin Taylor and Lauren Zalaznick are independent of

management and other outside interests that might interfere with their independent judgement.


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RTL Group’s Board of Directors

Martin Taylor was appointed under the criteria of independence of the London Stock Exchange, before RTL Group adopted the Ten Principles

of the Luxembourg Stock Exchange. Pernille Erenbjerg, Jean-Louis Schiltz and Lauren Zalaznick are independent directors, and all meet the

current criteria of independence of the Ten Principles of the Luxembourg Stock Exchange.

The Board of Directors has to review, with expert help if requested, that any transaction between RTL Group or any of its subsidiaries on the

one hand, and any of the shareholders or any of their respective subsidiaries on the other hand, is on arm’s-length terms.

The responsibility for day-to-day management of the company is delegated to the Chief Executive Officer (CEO). The Board of Directors has

a number of responsibilities, which include approving the Group’s annual budget, overseeing significant acquisitions and disposals, and

managing the Group’s financial statements. The Board of Directors met five times in person or online in 2023 – with an average attendance

rate of 98.3 per cent – and adopted some decisions by circular resolution.


Individual attendance of the members of the RTL Group Board of Directors	Participation in meetings	Attendance

Martin Taylor (Chair)	5/5	100%
Carsten Coesfeld	4/4	100%
Guillaume de Posch	5/5	100%
Pernille Erenbjerg	5/5	100%
Thomas Götz	5/5	100%
Elmar Heggen	5/5	100%
Rolf Hellermann	5/5	100%
Immanuel Hermreck	5/5	100%
Thomas Rabe	5/5	100%
Jean-Louis Schiltz	5/5	100%
James Singh	1/1	100%
Alexander von Torklus	4/4	100%
Bettina Wulf	1/1	100%
Lauren Zalaznick	4/5	80%


RTL Group Annual Report 2023


		43

The Executive Committee updates the Board on the Group’s activities and financial situation. At each meeting, representatives of the

Executive Committee brief the Board on ongoing matters, and on possible upcoming investment or divestment decisions.

In 2023, a total of €1.4 million (2022: €1.3 million) was allocated in the form of attendance fees to the non-executive members of the Board of

Directors of RTL Group SA and the committees that emanate from it (see note 10.4 to the consolidated financial statements in the RTL Group

Annual Report 2023).

Neither options nor loans have been granted to Directors.

Appropriate measures were taken by the company to ensure compliance with the provisions of the European market abuse regulation, and

with the Circulars of the Commission de Surveillance du Secteur Financier (CSSF) concerning the application of this legislation.

The following Board Committees are established:

Nomination and Compensation Committee

The CEO consults with the Nomination and Compensation Committee and shall obtain prior consent on the appointment and removal of

executive directors. The Nomination and Compensation Committee makes a proposal to the General Meeting of Shareholders on the

appointment and removal of the non-executive directors, and establishes the Group’s compensation policy.

The Nomination and Compensation Committee comprises four non-executive directors, one of whom is an independent director (who also

chairs the meetings) and meets at least twice a year. The committee’s plenary meetings are attended by the CEO, the COO/Deputy CEO and

the Executive Vice President Human Resources. The Nomination and Compensation Committee may involve other persons to help the

committee fulfil its tasks. The Chair of the Nomination and Compensation Committee reports on the discussions held and conclusions made

by the committee to the subsequent Board of Directors meeting. The Nomination and Compensation Committee met four times in 2023, by

telephone/video conference, with an average attendance rate of 94 per cent.


Individual attendance of the members of the Nomination and Compensation Committee	Participation in meetings	Attendance

Martin Taylor (Chair)	4/4	100%
Thomas Götz	4/4	100%
Immanuel Hermreck	4/4	100%
Lauren Zalaznick	3/4	75%

Audit Committee

The Audit Committee monitors the financial reporting process, the statutory audit of the legal and consolidated accounts, the independence

of the external auditors, the effectiveness of the Group’s internal controls, the compliance programme, and the Group’s risks. The Audit

Committee reviews the Group’s financial disclosures and submits a recommendation to the Board of Directors regarding the appointment of

the Group’s external auditors.

The Head of Internal Audit and the external auditors have direct access to the Chairman of the Audit Committee, who is an independent

director.

The Audit Committee is composed of at least four non-executive directors – two of whom are independent – and meets at least four times a

year.

The committee’s meetings are attended by the CEO, the COO/Deputy CEO, the Chief Financial Officer (CFO), the Head of Internal Audit, the

external auditors and other senior Group finance representatives. The Audit Committee may invite other persons whose collaboration is

deemed to be advantageous in helping the committee fulfil its tasks. Twice a year, the Head of Compliance is invited to provide an update on

the compliance programme and to report on the compliance cases raised in the period under review, as well as on their remediation.

The Audit Committee met five times in 2023 in person or online, with an average attendance rate of 100 per cent. The Chairman of the Audit

Committee reports on the discussions held and conclusions taken by the Audit Committee to the subsequent Board of Directors meeting.


Individual attendance of the members of the Audit Committee	Participation in meetings	Attendance

Pernille Erenbjerg (Chairman)	5/5	100%
Rolf Hellermann	5/5	100%
Martin Taylor	5/5	100%
Jean-Louis Schiltz	5/5	100%
Thomas Götz	5/5	100%


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		44

The Committee assists the Board of Directors in its responsibility with respect to overseeing the Group’s financial reporting, risk management

and internal control, and standards of business conduct and compliance.

CEO

Responsibility for the day-to-day management of the company rests with the CEO, who – on a regular basis and upon request of the Board –

informs the Board of Directors about the status and development of the Group.

The CEO is responsible for proposing the annual budget, to be approved by the Board of Directors. He is also responsible for determining the

ordinary course of the business.

Executive Committee

The Executive Committee comprises the two executive directors – the CEO and the COO/Deputy CEO – and the CFO. The Executive

Committee is vested with internal management authority.

In 2023, a total of €6.2 million (2022: €7.8 million) was allocated in the form of salaries, non-cash benefits and a post-employment benefit

plan to the members of the Executive Committee (see note 10.3 to the consolidated financial statements of the RTL Group Annual Report

2023).

External auditor

In accordance with the Luxembourg law on commercial companies, the Company’s annual accounts and consolidated financial statements

are certified by an external auditor, appointed at the Annual General Meeting of Shareholders. On 26 April 2023, the shareholders appointed

KPMG Audit Sàrl as statutory auditor for a term of one year, expiring at the end of the Annual General Meeting of Shareholders ruling on the

2023 accounts.

Dealing in shares

The company’s shares are listed on the Frankfurt and Luxembourg Stock Exchanges. Applicable German and Luxembourg insider dealing,

and market manipulation laws prevent anyone with material non-public information about a company from dealing in its shares and from

committing market manipulations.

A detailed Dealing Code contains restrictions on dealings by directors and certain employees of RTL Group and its subsidiaries, or associated

companies.

Restrictions apply to:

– members of the Board of Directors

– all employees of RTL Group SA, and directors and employees of any subsidiary or affiliated company of RTL Group who, because of their

position or activities, may have access to unpublished price-sensitive information.

Code of Conduct

Basic guidelines for responsible behaviour and for conducting business at RTL Group are governed by the Code of Conduct, which outlines

binding minimum standards for behaviour towards business partners and the public, and for behaviour within the company. The latest update

of the Group’s Code of Conduct was in 2021.A speak-up system is available in multiple languages, both online and via phone, to internal and

external stakeholders. The Group has a training programme in place to ensure all employees are fully aware of the code and its principles.

The Code of Conduct is available under the Compliance section on rtl.com.

Internal controls over financial reporting

RTL Group’s Internal Control System (ICS) over financial reporting aims to provide reasonable assurance on the reliability of external and

internal financial reporting, and its conformity with the applicable laws and regulations. It helps to ensure that financial reporting presents a

true and fair picture of the Group’s net assets, financial position and operational results. The ICS for the accounting process consists of the

following areas:

Standards and rules

The rules governing the Group’s financial reporting environment and critical accounting policies are set out in the Group’s internal rules for

accounting and the preparation of financial statements (such as IFRS manuals, guidelines and circulars), which are immediately available to

all employees involved in the accounting process. Standards of a minimum control framework for key accounting processes at the level of

RTL Group’s fully consolidated subsidiaries are formalised in a set of expected key controls. RTL Group’s centralised treasury and corporate

finance activities are governed by dedicated policies and procedures. Hedging of exposure in non-functional currency of the company is

governed by a strict policy. All internal and external financial reporting processes are organised through a centrally managed reporting

calendar. The Code of Conduct requires the Group’s companies to manage record-keeping and financial reporting with integrity and

transparency.


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		45

Systems and related controls

Locally used (ERP, treasury applications) finance systems are largely centrally managed through a few common system platforms to ensure

a consistent set-up of system-embedded controls. Segregation of duties, access rights and approval limits are regularly reviewed by the

local data owners for all reporting units whose finance systems are centrally maintained. Internal and external financial reporting is

transmitted through a centrally managed integrated finance system – from budgeting and trend year analysis, monthly internal

management reporting, and forecasting of financial and operational KPIs, to consolidation and external financial reporting, and finally risk

management reporting (see Risk management on pages 46 to 50).

Extensive automatic system controls ensure the consistency of the data in the financial statements. The centrally managed integrated

finance system is subject to ongoing development through a documented change process. Systemised processes for coordinating

intercompany transactions serve to prepare the corresponding consolidation steps. Circumstances that could lead to significant

misinformation in the consolidated financial statements or internal management reporting are monitored centrally and verified by external

experts as required. Specific system-embedded controls support the consolidation process, including the reconciliation of intercompany

transactions.

IT General Controls (ITGCs) are regularly assessed by external experts or Internal Audit. Control objectives are defined for all RTL Group

central applications and interfaces (the referenced applications) and their related IT infrastructure. The description of the control

environment and the effectiveness of these controls are subject to an annual ISAE3402 (Type 2) third-party assurance report. The Group’s

consolidation scope is constantly updated, both at the level of financial interests captured in the consolidation system, and at the level of

legal information through a dedicated legal scope system.

Analytics and reporting

All internal and external local and consolidated financial reporting is systematically reviewed by local finance staff or by finance teams

within the Corporate Centre. Typical analyses include comparisons with previous years, budget and forecast, financial and operational KPIs,

flows of key captions on the income statement, statement of the financial position, changes in equity, and cash flow statement. The finance

teams of the Corporate Centre and business units are also integrated into the internal management reporting. Internal and external reporting

are reconciled during the segment reconciliation process.

Regular communication between RTL Group’s operations and the Corporate Centre’s finance departments ensures that any issue that could

affect the Group’s financial reporting is immediately flagged and resolved. Both the Group as a whole and the individual business units are in

continuous contact with subsidiaries to ensure IFRS-compliant accounting as well as compliance with reporting deadlines and obligations.

Full-year and half-year reporting to the financial market is reviewed by the Audit Committee and approved by the Board of Directors. Q1 and

Q3 quarterly statements are approved by the Audit Committee upon delegation by the Board of Directors.

Transparency

RTL Group’s policy on the reporting of significant compliance incidents requires business units to immediately report fraud or other

significant compliance incidents to the Group. Identified control weaknesses that could affect the reliability of financial reporting – reported

by either external auditors or Internal Audit – are brought to the attention of management and the Audit Committee, and are part of a follow-

up process.

Each year, the business units self-assess the maturity level of their local internal controls over financial reporting. Results of this self-

assessment are reviewed by the Risk Management team and reported to the Audit Committee. At each meeting the Audit Committee is

updated on the key accounting, tax and legal issues within the Group.

The Corporate Centre constantly promotes the importance of sound internal controls – not only over financial reporting, but also for

operational processes – through dedicated workshops with RTL Group’s business units, and the work of the Internal Audit department.

Like the Risk Management System, each ICS cannot guarantee with absolute certainty that significant misinformation in the accounting

process can be prevented or identified.

Risk management

RTL Group defines its risk management as a continuous process at both business unit and Group level to prevent, protect, mitigate and

leverage risks when executing RTL Group’s strategy. RTL Group’s risk management system aligns with international risk management

standards (such as the COSO framework).

RTL Group’s risk management process is designed to meet the following main objectives:

– Embedded culture: promote and embed a common risk management culture in the daily work of all RTL Group employees.

– Consistent policy: develop consistent risk policies on key matters, to be tailored and implemented at business unit level with consideration

for local challenges and environment.

– Harmonised response: ensure harmonised risk management prevention, detection and mitigation measures across RTL Group and its

business units against key risks, as well as a continuous related monitoring and improvement programme.

RTL Group’s robust risk management processes are designed to ensure that risks are identified, monitored and controlled, and its risk

management system is based on a specific policy and a clear set of procedures. Policies and procedures are reviewed on a regular basis by

the Internal Audit department and/or external consulting companies. Risk management and risk reporting are coordinated by the Head of

Enterprise Risk Management (ERM).


RTL Group Annual Report 2023


		46


Risk matrix	Type of risk	Description and areas of impact	Mitigation activities
	External and market risks
	Change in market environment	Digitisation has significantly transformed the TV market, offering various ways of reaching viewers. Higher competition for audience attention and programme acquisitions as well as accelerated audience fragmentation due to streaming services, new channels, and expansion of platform operators may adversely affect RTL Group’s position. The advertising landscape for streaming services has evolved, driving growth and revenue in challenging conditions when platforms such as Disney and Netflix introduced ad-funded programming in exchange for cheaper subscriptions and with increased costs of content licensing. This could increase competition within the advertising markets, especially for RTL Group’s hybrid streaming services. The production business also shows a consolidation trend as increasing demand for talent – such as authors, scriptwriters, showrunners, actors – leads large production businesses to merge or acquire smaller production companies.	RTL Group embraces new digital opportunities by ensuring its channels and stations are platform-neutral (that is, available on the widest possible choice) and by developing families of channels and streaming services, based on its leading brands. By forming alliances and partnerships, RTL Group aims to counteract the dominance of global tech platforms. Examples include RTL AdAlliance (combining RTL AdConnect, G+J iMS and the media division of Smartclip). RTL Group’s European ad-tech business, Smartclip, fully integrated the French ad-tech company Realytics, complementing the group’s ad-tech stack. In TV advertising, RTL Group expands its addressable TV offerings, which connect precise, data-driven targeting with premium content in a brand-safe environment, delivered via traditional linear TV. Thereby, addressable TV offers the opportunity to compensate for potential future declines of classic TV advertising revenues. RTL Group intends to secure or improve its share in the resulting total TV advertising market. Within its global content business, Fremantle, RTL Group established a buy-and-build strategy – next to organic growth – to expand its global content business and to gain market share.
	Cyclical development of economy	The cyclical development of the economy is highly correlated with the development of the advertising markets and therefore impacts RTL Group’s revenue. 2023 had seen a light recovery from the deteriorated macroeconomic conditions in 2022, regarding inflation and supply chain issues, and a sharp reduction of Covid-related risks. However, advertising markets remain difficult to predict following the lack of visibility of macro-economic trends.	Continuous monitoring of market conditions, scenario planning and strict cost control allow RTL Group to react to economic downturns. RTL Group aims to further diversify its revenue base by introducing new products and services that generate non-advertising revenue.
	Legal	Local and European regulations are subject to change. Some changes could alter businesses and revenue streams (for example, a ban on certain types of advertisements on alcohol and high in fat and sugar foods), changes to data protection legislation as well as a limitation of advertising minutes.	RTL Group aims to anticipate any changes in legislation and to act accordingly by developing and exploiting new or alternative revenue sources.
	Risks in key business
	Strategic decisions	Strategic decisions are associated with risks. The resource allocation based on the strategic direction could become disadvantageous to RTL Group’s revenue and ultimately lead to a potential loss of revenue. This particularly relates to portfolio changes if acquired assets do not perform in line with assumed business plans and an impairment of goodwill may be triggered.	Investment policies are followed, underpinned by realistic business planning. Approval procedures are followed to ensure relevant risk assessment and management sign-off. A regular review of strategic options is undertaken.
	Audience share and advertising market share performance	A decrease in audience and/or advertising market share due to entrance of global operators (such as Netflix, Amazon Prime and Disney+) may have a negative impact on RTL Group’s revenue and profitability.	New talents and formats are developed or acquired. Performance of existing shows is under constant review with the aim of improving audience share performance and hence future revenue. RTL Group’s strategy is to extend and enhance the diversity and quality of its programmes – especially on its streaming services. Budget processes on subscriber revenue undergo ongoing maturation.
	Customers	Bad debts or loss of customers may negatively affect RTL Group’s profits. Advertisers may change behaviour by switching to alternative advertising platforms or to inhouse advertising planning.	Credit analysis of all new advertisers is systematically undertaken. Depending on the customer’s creditworthiness, insurance may be used. This risk is also mitigated by broadening the advertiser base. To match the customer evolution, RTL Group is evolving by exploring alternative advertising market platforms, matching customer behaviour changes.
	Suppliers	Strong competition may lead to increased costs and/or less profitable programmes. There may also be a strong reliance on key suppliers.	The Group aims to diversify its sources of supply wherever possible, partly by producing content in-house. RTL Group benchmarks purchasing terms and conditions to identify best practices with the aim of reducing costs by, for example, joint purchasing.
	Inventories	There is a risk of over-accumulation of stock that could become obsolete. This may lead to write-offs or impairments.	RTL Group has strict commercial policies, very close follow-ups of existing inventories, and strict criteria for approval of investment proposals for rights.


RTL Group Annual Report 2023


		47


Pricing/discounting	There is potential price erosion either at broadcaster level or at production level, or in the digital environment, where competition could impact margin levels.	RTL Group aims to satisfy customer needs by providing unique, tailored proposals through alliances and the company’s unique network position as well as the evolution of the business model.
IT infrastructure	Potential vulnerabilities within RTL Group operation systems and infrastructure may compromise business activities.	RTL Group entities use approved processes to continually monitor IT infrastructure and to update operating systems, if necessary, in line with the Group’s IT policies. Increase of the compliance rate has decreased the risk.
Financial risks
Foreign exchange exposure	The operating margin and programme costs are affected by foreign exchange volatility, especially if there is a strong increase of the USD against the EUR (such as feature films, sports and distribution rights, and scripted programmes).	RTL Group has in place a strict policy regarding foreign exchange management, which is monitored and followed up by Group Treasury, using hedging instruments and applying hedge accounting principles to mitigate volatility on the income statement.
Interest rate risk	The risk of increased cost of funding due to increase of interest rates.	RTL Group has entered into 3 new term loans based on 3-, 4- and 5-year horizons, leaving room for medium-term reimbursement while partially securing fixed interest rates.

Watchlist

On the RTL Group risk watch list composed of unquantifiable risks, management is very attentive to artificial intelligence deployment and

evolution, its opportunities but also related risk.

The introduction of two new IT referenced applications, being SAP S/4HANA as ERP and Quantum as Treasury Management System, is to be

carefully followed.

Finally, changes in the tax environment will also draw management attention to ensure all risks related to changes are integrated and

properly addressed.

Risk management organisation

The risk management organisation is the combination of structures and relationships (see diagram on the following page), which enables a

proper risk governance environment.

RTL Group’s risk management governance model has a strong vertical component – from the Board of Directors and Executive Committee to

the Audit and Risk Management Committees, to the executive responsible (CEO, CFO and Head of ERM), down to all levels of the dedicated

risk management functions, including local entities.

This backbone is enabled by related control functions carried out by Group Risk Management and Internal Control, the Legal and Regulatory,

Compliance, Business Development, Controlling and Investments, Communications and Investor Relations, Treasury, Insurance, Group

Financial Reporting, Tax, IT, Human Resources, and Sales and Commercial departments. Independent monitoring is also carried out by

Internal Audit and External Audit.

The Board of Directors is responsible for ensuring RTL Group maintains a sound system of internal controls, including financial, operational

and compliance risks.

The Risk Management Committee meets twice a year and is composed of the following permanent members:

– RTL Group Chief Financial Officer

– RTL Group Senior Vice President Internal Audit

– RTL Group Senior Vice President Compliance

– RTL Group Senior Vice President Treasury and Enterprise Risk Management

– RTL Group Senior Vice President Controlling and Investments

– RTL Group General Counsel

– RTL Group Senior Vice President Group IT

– RTL Group Senior Vice President Financial Reporting

– Media Assurances’ Chief Executive Officer

– Additional guests may be invited to participate in Risk Management Committee meetings as subject matter experts, based on the topics to

be addressed.


RTL Group Annual Report 2023


		48

Risk reporting framework

A risk is defined as a potential future development or event that can negatively affect the achievement of the Group’s strategic, operational,

reporting-related and compliance-related objectives.

RTL Group has developed a framework for reporting risks, in line with good corporate practice, which is based on several key principles:

– 1. Comprehensive scope of risk assessment: risks are assessed within a framework of defined key risk categories. Regular risk

assessments include a description of the risk, an indication of the potential financial impact, and steps taken to mitigate the risk.

These steps are performed throughout RTL Group, consolidated by the Head of Enterprise Risk Management and ultimately

summarised in a dedicated risk management report. Results are presented to the Audit Committee.

– 2. Regular and consistent reporting: RTL Group’s system of internal controls ensures that risks are addressed, reported and

mitigated when they arise. All significant risks are comprehensively assessed within the risk-reporting framework and reported to

RTL Group management twice a year. This ensures that necessary actions are undertaken to manage, mitigate or offset risks within

the Group. The risks are reported using a common reporting tool to ensure consistency in scope and approach.

– 3. Bottom-up approach: RTL Group assesses risks where they arise in its operations. All business units assess themselves

according to the three parts of the risk management report:

– Risk Management System: risk assessment and quantification of residual risks if applicable

– Internal Control System: self-assessment on internal controls in place

– Information Security Management System: risk assessment and quantification of IT-related risks

– 4. Consolidated Group matrix: Group Risk Management and the Internal Control team aggregate a comprehensive view of

significant risks for the Group by consolidating local risk assessments.

The Risk Management Committee evaluates and reviews this consolidated Group risk matrix and:

– advises on the control and reporting process for any major risks, and recommends mitigation strategies to the Group CFO

– monitors follow-up of risks and ensures mitigation measures have been taken

– increases risk awareness within the Group

– identifies potential optimisation opportunities in processes

The following risks and their classifications were reported for 2023:


RTL Group Annual Report 2023


		49

Risk classification

Risk classification (potential financial loss in three-year period)

Priority

Type of risk

Low

(<€50million)

Moderate

(<€100 million)

Significant

(<€250 million)

Considerable

(<€500 million)

Endangering

(>€500 million)

Changes in market environment

Audience and market share (RTL)

Cyclical development of economy

Legal risks

Customer risks

Supplier risks

IT and infrastructure

Strategic risks

Pricing/discounting

Risks without cash impact

For the first time, in line with EU legislation, the ESG risks (environmental, social and corporate governance data) were presented by a

working group. From 2024, these risks will be a fixed part of regular Group reporting.

– 5. Audit approach: both the process of local risk assessments and the consolidated Group risk matrices are regularly reviewed by Internal

and External Audit.

Internal control framework

Internal controls are policies and procedures implemented by an organisation to ensure their financial reports are reliable, operations are

efficient, and activities are compliant with applicable laws and regulations. The internal control system at RTL Group is designed to provide

reasonable assurance regarding the achievement of objectives in the following categories:

– Effectiveness and efficiency of operations, and the optimal use of the Group’s resources

– Integrity and reliability of financial and operational information

– Reliability of financial reporting

– Proper identification, assessment, mitigation and reporting of material risks

– Compliance with applicable laws, regulations, standards and contracts.

Throughout RTL Group, the risks are assessed within a framework of defined key risk categories. To each risk, internal control / controls are

assigned as a measure to make sure risk is monitored and mitigated.

All internal controls are assessed once a year by all Group entities, locally in one reporting tool, evaluated and aggregated by Group Risk

Management and the Internal Control team and presented to the Risk Management Committee together with the risks.

The backbone for internal controls is a Minimum Control Policy that is reviewed at least once a year.

During 2023, as part of the SAP S/4HANA implementation project, the RTL Group focused on the continuous improvement of internal control

processes by harmonising processes across the Group, strengthening tools, procedures and policies.

Also, to ensure uniform risk reporting, all Group entities were migrated to one internal controls, and risks reporting tool.

In 2024, the Group continues to raise awareness of risk management and internal controls, and to harmonise processes and policies as part

of the SAP4Hana project.

Risk management in the future

RTL Group’s risk management framework is constantly challenged – at both operational and Group level – through the Risk Management

Committee, to ensure it reflects the risk profile of the Group at any time.

To ensure RTL Group’s Enterprise Risk Management process and reporting requirements are consistently implemented throughout the Group,

it holds regular workshops to update staff and to introduce new tools available to assess risk.

General Management Statement on Risk Evaluation

RTL Group is committed to high-risk management standards and applies principles endorsed by local and European regulations and

expected by market authorities. Consequently, RTL Group has developed a risk management system integrated into an enterprise-wide

process, as outlined in the previous section.

RTL Group defines its risk management process as a continuous process at business unit and Group level to prevent, protect, mitigate and

leverage risks considering the execution of the Group’s strategic objectives and values. RTL Group’s risk management strategy is a holistic

and enterprise-wide process, aligned to the definition and execution of the Group’s strategy. RTL Group may have to make strategic decisions

involving a new set of risks or reassessment of existing risks that need to be addressed within the risk management framework.

As of the date of this report, management considers the overall risk position of the Group to be stable, though there has been significant

deterioration in macroeconomic conditions, reflected in lower economic sentiment and growth expectations, due to the war in Ukraine,

inflation, energy supply and supply chain issues. Changes in the industry – in particular due to new technologies and increasing competition

with US platforms – will continue to affect the Group.

There are currently no risks that, individually or in combination with other risks, could have a material or lasting adverse effect on the revenue,

earnings, financial position or performance of RTL Group over the projection period of three years.


RTL Group Annual Report 2023


		50

Opportunity management

Opportunity-management system

An efficient opportunity-management system enables RTL Group to secure its success in the long term, and to exploit its potential in the best

possible way. Opportunities are defined as future developments or events that could result in a positive change from either the Group’s

outlook or from strategic objectives. RTL Group’s Risk Management System (RMS) is an important part of the company’s business processes

and decisions. Significant opportunities are identified from profit-centre-level upward, during the Group’s annual strategy and planning

process.

This largely decentralised system is coordinated by central departments to identify opportunities for cooperation across the Group and within

the business units. Experience is shared within divisions, and this collaborative approach is reinforced by regular senior management

meetings.

Opportunities

The Group has strategic, financial and regulatory opportunities. These could result from a better-than-expected performance of streaming

services and advertising technology; from higher demand for content; from a better-than-expected macro-economic development, leading

to higher advertising market growth; from higher market shares resulting from programme successes; and from changes in the laws

regulating the Group’s businesses, such as advertising. In addition, RTL Group’s strategy to form cross-media champions could create

significant value through the synergy potential of creating RTL AdAlliance to satisfy the demand of ad-buying opportunities. RTL Group

continues to develop its business model, to rethink its operational processes and to set the path for more open and agile collaboration across

countries, departments and functions. AI opens many opportunities as a driver to increase efficiency and personalised output to support

creative processes.

Luxembourg Law on Takeover Bids

The following disclosures are made in accordance with article 11 of the Luxembourg Law on Takeover Bids of 19 May 2006.

a) Share capital structure

RTL Group SA has issued one class of shares which is admitted to trading on the Frankfurt Stock Exchange and the Luxembourg Stock

Exchange. No other securities have been issued. The issued share capital as at 31 December 2023 amounts to €191,845,074 represented

by 154,742,806 shares with no par value, each fully paid up.

b) Transfer restrictions

At the date of this report, all RTL Group SA shares are freely transferable but shall be subject to the provisions of the applicable German

and Luxembourg insider dealing and market manipulation laws, which prevent anyone who has material non-public information about a

company from dealing in its shares and from committing market manipulations. A detailed Dealing Code contains restrictions on dealings

by directors and certain employees of RTL Group SA and its subsidiaries.

c) Major shareholding

The shareholding structure of RTL Group SA as at 31 December 2023 is as follows: Bertelsmann Capital Holding GmbH held 76.28 per

cent, and 23.72 per cent were publicly traded.

d) Special control rights

All the issued and outstanding shares of RTL Group SA have equal voting rights and no special control rights attached.

e) Control system in employee share scheme

RTL Group SA’s Board of Directors is not aware of any issue regarding section e) of article 11 of the Luxembourg Law on Takeover Bids of 19

May 2006.

f) Voting rights

Each share issued and outstanding in RTL Group SA represents one vote. The Articles of Association do not provide for any voting

restrictions. In accordance with the Articles of Association, a record date for the admission to a general meeting is set and certificates for

the shareholdings and proxies shall be received by RTL Group SA the 14th day before the relevant date at 24 hours (Luxembourg time).

Additional provisions may apply under Luxembourg law.

g) Shareholders’ agreement with transfer restrictions

RTL Group SA’s Board of Directors has no information about any agreements between shareholders that may result in restrictions on the

transfer of securities or voting rights.

h) Appointment of Board members, amendments of the Articles of Association

The appointment and replacement of Board members and the amendments of the Articles of Association are governed by Luxembourg

Law and the Articles of Association. The Articles of Association are published under the Investor Relations section on rtl.com.

i) Powers of the Board of Directors

The Board of Directors is vested with the broadest powers to manage the business of RTL Group SA. It may take all acts of administration

and of disposal in the interests of RTL Group SA. The Board of Directors has set up several committees whose members are Directors. The

responsibilities and functionalities of the Board of Directors and its committees are described in the Articles of Association and the

Corporate Governance Charter, published under the Investor Relations section on rtl.com.


RTL Group Annual Report 2023


		51

The Company’s Annual General Meeting of shareholders held on 26 April 2019 renewed the authorisation granted at the Company’s

Annual General Meeting of shareholders of 16 April 2014 to the Board of Directors, to acquire a total number of shares of the company not

exceeding 150,000. This renewal of authorisation is valid for five years and the purchase price is fixed at a minimum of 90 per cent and a

maximum of 110 per cent of the average closing price of the RTL Group share over the last five trading days preceding the acquisition.

j) Significant agreements or essential business contracts

The Board of Directors is not aware of any significant agreements to which RTL Group SA is party and which take effect, alter or terminate

upon a change of control of RTL Group SA following a takeover bid.

k) Agreements with Directors and employees

The Executive Committee members are entitled to contractual severance payments in the case of dismissal, except in the case of

dismissal for serious reasons.


RTL Group Annual Report 2023


		52

Declaration of Conformity with recommendations

C.10, D.3, D.9 and D.11 of the German Corporate

Governance Code for use by foreign companies

RTL Group SA is a public limited liability company under Luxembourg law. The German Corporate Governance Code (GCGC) does therefore

not apply to RTL Group SA and RTL Group SA does not have to issue a Declaration of Conformity with the GCGC under section 161 of the

German Stock Corporation Act (Aktiengesetz).

Solely for purposes of section 4.1.1.1 of the Guide to the DAX Equity Indices of STOXX Ltd., RTL Group SA declares that it does not deviate

from recommendations C.10 (with sole reference to its applicability to the Chairman of the Audit Committee), D.3, D.9 and D.11 of the GCGC,

in each case applied accordingly to a public limited liability company with a one-tier governance system under Luxembourg law.

RTL Group’s Board of Directors or its audit committee arranges for RTL Group’s external auditors to inform it and note in the audit report if,

during the performance of the audit, the external auditors identify any facts that indicate an inaccuracy in adhering to the recommendations

in C.10, D.3, D.9 or D.11 of the GCGC in each case applied accordingly to a public limited liability company with a one-tier governance system

under Luxembourg law.

Luxembourg, 13 March 2024

The Board of Directors

RTL Group SA


RTL Group Annual Report 2023


		53

Subsequent events

In February 2024, Fremantle reached an agreement with Oaktree Capital Management, subject to customary closing conditions, to fully

acquire Asacha Media Group, a European production group based in France that owns interests in eight production companies in France, Italy

and the UK. The multi-award-winning slate of international IP in this portfolio includes Death in Paradise for BBC One and Scènes de

ménages for M6. Asacha Media Group is diversified in geography, genre and its customer base, complementing Fremantle’s footprint in

Europe and strengthening Fremantle’s position as home to top and new talent. The transaction will be accounted for as a business

combination in accordance with IFRS 3. At the time the consolidated financial statements were authorised for issue, the purchase price

allocation considering the preliminary estimated consideration of €125 million was at a very preliminary stage.

In February 2024, Fremantle acquired an 80 per cent interest in the Asian production company Beach House Pictures. The Singapore-based

company has a base in China and partners in Southeast Asia, Korea, Japan and India. They specialise in creating and co-financing original IP

across non-scripted content but also scripted, entertainment and brand-funded programming for all major regional and international

platforms. Most recent productions include the Emmy-nominated Netflix lifestyle series Mind Your Manners and the Netflix Global Top 5 true

crime documentary series Missing: The Lucie Blackman Case. The transaction will be accounted for as a business combination in accordance

with IFRS 3. At the time the consolidated financial statements were authorised for issue, the purchase price allocation considering the

preliminary estimated consideration of €11 million was at a very preliminary stage.

In March 2024, Groupe M6 presented its investment plan for its streaming service M6+ (previous 6play). The additional investments of

€100 million in content, technology and marketing will build up over time. The service will be primarily financed by advertising (AVOD),

complemented by a premium subscription tier (SVOD). It will feature exclusive local content accessible from all screens alongside offering

innovative experiences for the viewers and a higher value proposition for advertisers. The service will run on the technology platform provided

by Bedrock and is set to launch in May 2024.

In March 2024, Groupe M6 announced that it acquired the exclusive free-to-air TV rights for the majority of the matches of the Fifa World

Cup in 2026 and 2030 – representing 54 matches for each tournament. This significant acquisition strengthens Groupe M6’s event-based,

free-to-air sports offering and its streaming service M6+.


RTL Group Annual Report 2023


		54

Outlook

The geopolitical and macroeconomic environment remains volatile, and the impact on RTL Group’s businesses continues to be hard to

predict. On the basis of a slight recovery of the German TV advertising market and broadly stable advertising markets in the Group’s other

territories,

– RTL Group expects its full-year revenue to increase to around €6.6 billion, based on higher revenue from RTL Deutschland (mainly driven

by strong growth in streaming revenue) and Fremantle (mainly driven by a recovery in the US market and acquisitions).

– RTL Group expects its Adjusted EBITA for 2024 to be around €750 million, with a variance of plus/minus €50 million, depending on the

development of the German and French TV advertising markets in 2024. This Adjusted EBITA outlook includes higher content costs,

primarily for the broadcast of Euro 2024 matches in France and Germany, and higher streaming start-up losses (2023: €176 million)

primarily due to the investments in M6+ in France.

– RTL Group’s dividend policy remains unchanged: RTL Group plans to pay out at least 80 per cent of the adjusted full-year net result.


	2023	2024e

Revenue	€6,234m	~€6.6bn
Adjusted EBITA	€782m	~€750m (+/- €50m)
thereof streaming start-up losses	€176m	~€200m

Strategic targets for RTL Group’s streaming services


	202325	2026e26

Paying subscribers	5.6m	~9m
Streaming revenue	€283m	~€750m
Content spend per annum	€270m	~€500m

26; 27

Profitability is expected by 2026 28.

Fremantle targets

Fremantle targets full-year revenue of €3 billion by 2025/2026.

To achieve this goal, RTL Group is investing significantly in Fremantle – both organically and via acquisitions – across entertainment, drama

and film, and documentaries.

After integrating its acquired labels/production companies into the Fremantle network and reducing overhead, Fremantle’s Adjusted EBITA

margin is expected to increase to 9 per cent by 2026.

13 March 2024

The Board of Directors


RTL Group Annual Report 2023


		55

26 RTL+ in Germany, 6play in France and RTL+ in Hungary

27 RTL+ in Germany, M6+ (previous 6play) in France and RTL+ in Hungary

28 Total of Adjusted EBITA from RTL+ in Germany and Hungary, M6+ in France and Bedrock as consolidated on RTL Group level. The Adjusted EBITA of RTL+ in Germany and Hungary and M6+

includes synergies with TV channels at business unit level. For the definition of Adjusted EBITA please see Key performance indicators on pages 19 to 21

Management responsibility

statement

We, Thomas Rabe, Chief Executive Officer, Elmar Heggen, Chief Operating Officer and Deputy Chief Executive Officer, and Björn Bauer, Chief

Financial Officer, confirm, to the best of our knowledge, that these 2023 consolidated financial statements which have been prepared in

accordance with the International Financial Reporting Standards as adopted by the European Union, give a true and fair view of the assets,

liabilities, financial position and profit or loss of RTL Group and the undertakings included in the consolidation taken as a whole, and that the

Directors’ report includes a fair review of the development and performance of the business and the position of RTL Group and the

undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

Luxembourg, 13 March 2024


Thomas Rabe	Elmar Heggen	Björn Bauer

Chief Executive Officer	Chief Operating Officer	Chief Financial Officer
	Deputy Chief Executive Officer


RTL Group Annual Report 2023


		56

Consolidated financial statements

Consolidated income statement


		2023	2022
	Notes	€m	€m

Continuing operations
Revenue	5.1	6,234	6,589
Other operating income	5.2	102	83
Consumption of current programme rights		(2,566)	(2,657)
Depreciation, amortisation and impairment		(239)	(231)
Other operating expenses	5.3	(2,969)	(3,025)
Impairment of goodwill and amortisation and impairment of fair value adjustments on acquisitions of subsidiaries		(43)	(46)
Gain/(loss) from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree	4.3 6.5	40	107
Profit from operating activities		559	820

Share of results of investments accounted for using the equity method	6.5	61	13
Impairment and reversals of investments accounted for using the equity method	6.5	–	(5)
Earnings before interest and taxes (EBIT)		620	828

Interest income	5.4	13	5
Interest expense	5.4	(36)	(18)
Other financial income	5.5	44	5
Other financial expenses	5.5	(34)	(48)
Financial result		(13)	(56)

Profit before tax from continuing operations		607	772
Income tax expense	5.6	(124)	(130)

Group profit from continuing operations		483	642

Discontinued operations
Group profit from discontinued operations	6.11	115	124

Total Group profit		598	766

Attributable to:
RTL Group shareholders		467	673
– Continuing operations		352	549
– Discontinued operations		115	124
Non-controlling interests		131	93
– Continuing operations		131	93
– Discontinued operations		–	–

Earnings per share (in €)	5.7
Basic earnings per share		3.02	4.35
– Continuing operations		2.27	3.55
– Discontinued operations		0.74	0.80
Diluted earnings per share		3.02	4.35
– Continuing operations		2.27	3.55
– Discontinued operations		0.74	0.80

The figures from the previous year have been adjusted due to discontinued operations (see note 1.30).


RTL Group Annual Report 2023


		57

Consolidated statement of comprehensive income


		2023	2022
	Notes	€m	€m

Total Group profit		598	766

Other comprehensive income (OCI):
Items that will not be reclassified to profit or loss:
Re-measurement of post-employment benefit obligations	6.15	(13)	108
Income tax	6.7	3	(29)
		(10)	79

Equity instruments at FVOCI – change in fair value	6.6	3	(5)
Income tax	6.7	(1)	2
		2	(3)

Share of other comprehensive income of investments accounted for using the equity method	6.5	(1)	23
Income tax		–	–
		(1)	23

		(9)	99

Items that may be reclassified subsequently to profit or loss:
Foreign currency translation differences		(22)	22

Effective portion of changes in fair value of cash flow hedges	6.16.4	(10)	14
Income tax	6.7	3	(2)
		(7)	12

Recycling of cash flow hedge reserve	6.16.4	1	–
Income tax	6.7	–	–
		1	–

Share of other comprehensive income of investments accounted for using the equity method		–	2
Income tax		–	–
		–	2

		(28)	36

Other comprehensive income/(loss), net of income tax		(37)	135

Total comprehensive income		561	901

Attributable to:
RTL Group shareholders		432	802
Non-controlling interests		129	99

Total comprehensive income attributable to RTL Group shareholders		432	802
– Continuing operations		318	679
– Discontinued operations		114	123


RTL Group Annual Report 2023


		58

Consolidated statement of financial position


		31 December 2023	31 December 2022
	Notes	€m	€m

Non-current assets
Programme and other rights	6.1	68	73
Goodwill	6.2	3,148	3,331
Other intangible assets	6.2	557	591
Property, plant and equipment	6.3	257	272
Right-of-use assets	6.4	270	342
Investments accounted for using the equity method	6.5	405	376
Loans and other non-current assets	6.6	114	113
Deferred tax assets	6.7	302	316
		5,121	5,414

Current assets
Programme rights	6.8	1,562	1,574
Other inventories		9	18
Income tax receivable		34	51
Accounts receivable and other current assets	6.9	1,950	2,503
Cash and cash equivalents	6.10	575	589
		4,130	4,735

Assets held for sale	6.11	416	–

Current liabilities
Loans and bank overdrafts	6.12	253	547
Lease liabilities	6.12	76	85
Income tax payable		18	24
Accounts payable and other liabilities	6.13	1,714	2,324
Contract liabilities	5.1	481	590
Provisions	6.14	88	111
		2,630	3,681

Liabilities related to assets held for sale	6.11	227	–

Net current assets		1,689	1,054

Non-current liabilities
Loans	6.12	689	138
Lease liabilities	6.12	225	300
Accounts payable and other liabilities	6.13	498	508
Contract liabilities	5.1	6	5
Provisions	6.14	223	218
Deferred tax liabilities	6.7	69	79
		1,710	1,248

Net assets		5,100	5,220

Equity attributable to RTL Group shareholders		4,250	4,422

Equity attributable to non-controlling interests	6.16.8	850	798

Equity	6.16	5,100	5,220

The figures from the previous year have been adjusted (see note 1.30).


RTL Group Annual Report 2023


		59

Consolidated statement of changes in equity


	Share capital	Currency translation reserve	Hedging reserve	Revaluation reserve	Reserves and retained earnings	Equity attributable to RTL Group shareholders	Equity attributable to non- controlling interests	Total equity
	€m	€m	€m	€m	€m	€m	€m	€m

Balance at 1 January 2022	192	(149)	5	68	4,422	4,538	766	5,304

Total comprehensive income:
Total Group profit	–	–	–	–	673	673	93	766
Other comprehensive income (OCI)	–	23	13	20	73	129	6	135
	–	23	13	20	746	802	99	901

Capital transactions with owners:
Dividends	–	–	–	–	(774)	(774)	(76)	(850)
Equity-settled transactions, net of tax	–	–	–	–	3	3	3	6
Transactions on non-controlling interests without a change in control	–	–	–	–	(134)	(134)	(23)	(157)
Transactions on non-controlling interests with a change in control	–	–	–	–	–	–	28	28

Other changes	–	–	(7)	(1)	(5)	(13)	1	(12)
	–	–	(7)	(1)	(910)	(918)	(67)	(985)
Balance at 31 December 2022	192	(126)	11	87	4,258	4,422	798	5,220

Balance at 1 January 2023	192	(126)	11	87	4,258	4,422	798	5,220

Total comprehensive income:
Total Group profit	–	–	–	–	467	467	131	598
Other comprehensive income (OCI)	–	(22)	(6)	1	(8)	(35)	(2)	(37)
	–	(22)	(6)	1	459	432	129	561

Capital transactions with owners:
Dividends	–	–	–	–	(619)	(619)	(76)	(695)
Equity-settled transactions, net of tax	–	–	–	–	2	2	2	4
Transactions on non-controlling interests without a change in control	–	–	–	–	(2)	(2)	(3)	(5)
Transactions on non-controlling interests with a change in control	–	–	–	–	–	–	(1)	(1)

Other changes	–	–	(4)	–	19	15	1	16
	–	–	(4)	–	(600)	(604)	(77)	(681)
Balance at 31 December 2023	192	(148)	1	88	4,117	4,250	850	5,100

The figures from the previous year have been adjusted (see note 1.30)


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		60

Consolidated cash flow statement


		2023	2022
	Notes	€m	€m

Cash flows from operating activities
Group profit before tax		752	932

Adjustments for:
– Depreciation, amortisation and impairment		248	240
– Impairment of goodwill and amortisation and impairment of fair value adjustments on acquisitions of subsidiaries		43	46
– Impairment and reversals on other financial assets at amortised cost		2	30
– Share-based payments expenses		4	5
– Re-measurement of earn-out arrangements		9	–
– Fair value measurement of investments		23	78
– (Gain)/loss from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree		(40)	(107)
– Financial results including net interest expense and share of results of investments accounted for using the equity method		(23)	132
Change of provisions	6.14	(5)	(97)
Working capital changes		(316)	(503)
Income tax paid		(162)	(293)
Other changes from operating activities		2	–
Net cash from operating activities		537	463
– Thereof discontinued operations	6.11	77	140

Cash flows from investing activities
Acquisitions of:
– Programme and other rights		(57)	(68)
– Subsidiaries, net of cash acquired	4.2	(44)	(113)
– Companies under common control, net of cash acquired	4.2	–	166
– Other intangible and tangible assets		(120)	(133)
– Other investments and financial assets		(37)	(48)
Proceeds from the sale of intangible and tangible assets		1	1
Disposal of other subsidiaries, net of cash disposed of	4.3	32	194
Proceeds from the sale of investments accounted for using the equity method, other investments and financial assets		31	105
Interest received		21	10
Current deposits with shareholder and its subsidiaries	10.1	199	544
Net cash from/(used in) investing activities		26	658
– Thereof discontinued operations	6.11	(5)	(3)

Cash flows from financing activities
Interest paid		(34)	(24)
Transactions on non-controlling interests	6.16.8	(7)	(67)
Proceeds from loans	6.12	293	35
Repayment of loans	6.12	(41)	(79)
Payment of lease liabilities	6.12	(86)	(81)
Dividends paid		(696)	(860)
Other changes from financing activities		(7)	(16)
Net cash used in financing activities		(578)	(1,092)
– Thereof discontinued operations	6.11	(72)	(137)

Net increase/(decrease) in cash and cash equivalents		(15)	29
Exchange rate effects and other changes in cash and cash equivalents		–	(11)

Cash and cash equivalents and bank overdrafts at the beginning of the year	6.10	588	570
Cash and cash equivalents and bank overdrafts at the end of the year		573	588
Less cash and cash equivalents included within assets held for sale	6.11	–	–
Cash and cash equivalents and bank overdrafts at the end of the year (without assets held for sale)	6.10	573	588


RTL Group Annual Report 2023


		61

Notes to the consolidated financial statements

1. General information and material accounting policies

RTL Group S.A. (the ‘Company’) is a company incorporated under Luxembourgish law. The consolidated financial statements of the Company

as at 31 December 2023, comprise the Company and its subsidiaries (together referred to as ‘RTL Group’ or ‘the Group’) and the Group’s

interest in associates and joint ventures.

RTL Group S.A. is a leading entertainment company across broadcast, streaming, content and digital, with interests in 60 television channels,

seven streaming services and 36 radio stations and a global business for content production and distribution. RTL Group’s business model is

to produce, aggregate, distribute and monetise the most attractive video content, across all formats and platforms.

The Company is listed on the Frankfurt and Luxembourg Stock Exchanges and is a member of the MDAX stock index. Statutory accounts can

be obtained at its registered office established at 43, boulevard Pierre Frieden, L-1543 Luxembourg.

The ultimate parent company of RTL Group S.A. preparing consolidated financial statements, Bertelsmann SE & Co. KGaA, includes in its

consolidated financial statements those of RTL Group S.A. Bertelsmann SE & Co. KGaA is a company incorporated under German law whose

registered office is established at Carl-Bertelsmann-Straße 270, D-33311 Gütersloh, Germany. Consolidated financial statements for

Bertelsmann SE & Co. KGaA can be obtained at the company’s registered office.

The consolidated financial statements of the Group were authorised for issue by the Board of Directors on 13 March 2024. They will be

submitted for approval to the next Annual General Meeting of shareholders on 24 April 2024.

1.1 Statement of compliance

The RTL Group SA consolidated financial statements were prepared in accordance with International Financial Reporting Standards (IFRS) of

the International Accounting Standards Board (IASB) and the related interpretations (IFRIC) of the IFRS Interpretations Committee (IFRS IC)

that are applicable in the European Union (EU-IFRS).

1.2 Basis of preparation of consolidated financial statements

The consolidated financial statements are presented in millions of Euro, which is the Company’s functional and Group presentation currency,

and have been prepared under the historical cost convention except for the following material items in the statement of financial position:

– Derivative financial instruments are measured at fair value

– Non-derivative financial instruments at fair value through profit or loss (FVTPL) are measured at fair value

– Equity instruments at fair value through OCI (FVOCI) are measured at fair value

– Liabilities for cash-settled share-based payment arrangements are measured at fair value

– The defined benefit assets and liabilities are measured in accordance with IAS 19

– Assets held for sale and liabilities related to those assets are measured at the lower of its carrying amount and fair value less cost to sell in

accordance with IFRS 5.

The preparation of financial statements in conformity with IFRS as adopted by the European Union requires management to make

judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and

expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be

reasonable under the present circumstances, are providing the basis of making the judgements about carrying amounts of assets and

liabilities that are not directly available from other sources. Actual results may differ from historical estimates. The estimates and underlying

assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is

revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future

periods. Judgements made by management in the course of applying IFRS that cause a significant effect on the financial statements, and

estimates with a significant risk of material adjustment in the subsequent years, are discussed in note 2.

Impact of new financial reporting standards, interpretations and amendments

RTL Group applies the exception offered by the amendment to IAS 12 – Income Taxes, relating to the international tax reform Pillar Two,

regarding the non-recognition of deferred tax assets and liabilities related to Pillar Two income taxes. Based on the information available to

date, RTL Group considers the resulting effects for the group to be immaterial. Further information is presented in note 1.26.

The effects of the first-time application of other new accounting standards, amendments to existing IASB accounting standards and

published interpretations of the IFRS IC had no material impact on the consolidated financial statements of RTL Group.

Impact of issued financial reporting standards that are not yet effective

RTL Group has not opted for early adoption of any additional standards, interpretations or amendments that have been issued by the IASB or

the IFRS IC but are not yet mandatory.

Impact of external events on the consolidated financial statements

In 2023, multiple external events impacted the business environment of RTL Group. These include the continuing geopolitical tensions with

the war in Ukraine and the conflict in the Middle East accompanied by a sustained high level of inflation. Inflation had direct implications on

the business performance of RTL Group (e.g. increase in raw material costs) as well as indirect implications (e.g. reduced bookings from

advertising clients).


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		62

This impacted RTL Group’s financial performance in the financial year 2023, resulting in decline of revenues and a decreasing Adjusted

EBITA. The external challenges and associated uncertainties have been, and will continue to be, regularly monitored by management to allow

for early intervention if necessary. This particularly applies to the areas of impairment of goodwill and individual assets, leasing,

programming rights, inventories, trade receivables, government grants, deferred tax assets, contingent losses and revenues. Based on the

current development of the business, no impairment of goodwill was considered necessary. This also applies to the accounting areas

classified as vulnerable, for which no significant negative impact on the financial position and results of operations of RTL Group is currently

expected.

The assessment is based on judgements, estimates and assumptions that involve uncertainties as characterised above. Management

assumes that these uncertainties have been appropriately taken into account in their assessments.

Consideration of climate change

The preparation of consolidated financial statements involves taking into account climate change issues. The assumptions underlying the

estimates in the consolidated financial statements, in particular for the impairment test of goodwill, considers the future effects of climate

change. According to this assessment, the consequences of climate change had no significant impact on the Group’s consolidated financial

statements and no material impact on the short-term and medium-term business activities.

1.3 Principles of consolidation

1.3.1 Subsidiaries

Subsidiaries are those undertakings controlled by the Company. Control exists when the Company has power or ability, directly or indirectly,

over an entity; is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect these returns

through its power over the entity. The existence and effect of potential voting rights that are presently exercisable or presently convertible

are considered when assessing whether the Company controls another entity. Directly or indirectly held subsidiaries are consolidated from

the date on which control is transferred to the Company, and are no longer consolidated from the date that control ceases.

The full consolidation method is used, whereby the assets, liabilities, income and expenses are fully incorporated. The proportion of the net

assets and net income attributable to non-controlling interests is presented separately as non-controlling interests in the consolidated

statement of financial position and in the consolidated income statement.

Intra-group balances and transactions, and any unrealised income and expense (except for foreign currency transaction gains or losses)

arising from intra-group transactions, are eliminated in preparing the consolidated financial statements.

Accounting for business combinations

Business combinations are accounted for using the acquisition method as at the acquisition date, which is the date on which control is

transferred to the Group.

For acquisitions on or after 1 January 2010, the Group measures goodwill at the acquisition date as:

– the fair value of the consideration transferred; plus

– the recognised amount of any non-controlling interests in the acquiree; plus, if the business combination is achieved in stages, the fair value

of the existing equity interest in the acquiree; less

– the net recognised amount of the identifiable assets acquired, and liabilities assumed.

When the excess is negative, a bargain purchase gain is recognised immediately in profit or loss.

The consideration transferred for the acquisition of a subsidiary is the fair value of the assets transferred, the liabilities incurred, and the

equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent

consideration arrangement. Costs related to the acquisition – other than those associated with the issue of debt or equity securities – that

the Group incurs in connection with a business combination, are expensed as incurred.

Any contingent consideration payable is recognised at fair value at the acquisition date. Contingent consideration is classified as either

equity or a financial liability. If an obligation to pay contingent consideration is classified as equity, then it is not re-measured, and settlement

is accounted for within equity. It is a Level 3 fair value measurement based on the discounted cash flows (DCF) and derived from market

sources as described in notes 6.2 and 7.3.

The potential cash payments related to put options issued by the Group over the equity of subsidiary companies are accounted for as

financial liabilities. The amount that may become payable under the option on exercise is initially recognised for the present value of the

redemption amount within accounts payable with a corresponding charge directly in equity or through goodwill in case of a business

combination with the transfer of the risks and rewards of the non-controlling interests to the Group. Subsequent measurement of liabilities

from put options is recognised in profit or loss. The income/(expense) arising is recorded in ‘Other financial income’ or ‘Other financial

expenses’.

On an acquisition-by-acquisition basis the Group recognises any non-controlling interests in the acquiree either at fair value or at the non-

controlling interest’s proportionate share of the acquiree’s net assets.

Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair

value at the acquisition date.


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Accounting for transactions under common control

For transactions under common control RTL Group applies the accounting policy choice to recognise assets acquired and liabilities assumed

at carrying amounts, while the difference between assets/liabilities and consideration transferred is recognised in equity under ‘Other

changes’.

Accounting for transactions with non-controlling interests

The Group treats transactions with non-controlling interests as transactions with equity owners of the Group. For acquisitions from non-

controlling interests, the difference between any consideration paid and the relevant share acquired of the carrying amount of the net assets

of the subsidiary is recorded in equity. Gains or losses on disposals of non-controlling interests are also recorded in equity.

Loss of control

When the Group ceases to have control, any retained interest in the entity is re-measured to its fair value at the date when control is lost, with

the change in carrying amount recognised in profit or loss. The fair value subsequently becomes the initial carrying amount for the purposes

of accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised in other

comprehensive income in respect of that entity are accounted for as if the Group had directly disposed of the related assets or liabilities. This

may mean that amounts previously recognised in other comprehensive income are reclassified to profit or loss.

1.3.2 Investments accounted for using the equity method

The investments accounted for using the equity method comprise interests in associates and joint ventures. Associates are defined as those

investments where the Group can exercise a significant influence. Joint ventures are arrangements in which the Group has joint control,

whereby the Group has rights to the net assets of arrangements, rather than rights to their assets and obligations for their liabilities. Such

investments are recorded in the consolidated statement of financial position using the equity method of accounting and are initially

recognised at cost, which includes transaction costs. Under this method, the Group’s share of the post-acquisition profits or losses of

investments accounted for using the equity method (impairment loss included) is recognised in profit or loss, and its share of post-acquisition

movements in reserves is recognised in reserves.

When the Group’s share of losses in an investment accounted for using the equity method equals or exceeds its interest in the investment

accounted for using the equity method, including any other unsecured receivables, the Group does not recognise further losses, unless it has

incurred obligations or made payments on behalf of the investment accounted for using the equity method.

Unrealised gains on transactions between the Group and its investments accounted for using the equity method are eliminated against the

investment accounted for using the equity method to the extent of the Group’s interest in the investee. Unrealised losses are also eliminated

unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies for investments accounted for using

the equity method have been changed where necessary to ensure consistency with the policies adopted by the Group and restated in the

case of specific transactions on RTL Group level in relation to investments.

1.4 Foreign currency translation

1.4.1 Foreign currency translations and balances

Transactions in foreign currencies are translated to the respective functional currencies of Group entities at the foreign exchange rate ruling

at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated at the

foreign exchange rate ruling at that date. Foreign exchange differences arising on translation are generally recognised in profit or loss. Non-

monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at

the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are translated

to Euro at foreign exchange rates ruling at the date the fair value was determined.

1.4.2 Financial statements of foreign operations

The assets and liabilities of foreign operations, including goodwill, and fair value adjustments arising on consolidation, are translated to Euro

using the foreign exchange rate prevailing at the reporting date. Income and expenses are translated at the average exchange rate for the

year under review. The foreign currency translation differences resulting from this treatment and those resulting from the translation of the

foreign operations’ opening net asset values at year-end rates are recognised directly in a separate component of equity.

Exchange differences arising from the translation of the net investment in a foreign operation, or associated undertaking and financial

instruments, which are designated and qualified as hedges of such investments, are recognised directly in a separate component of equity.

On disposal or partial disposal of a foreign operation, such exchange differences or proportion of exchange differences are recognised in

profit or loss as part of the gain or loss on sale.

1.5 Derivative financial instruments and hedging activities

Fair value

Derivative financial instruments are initially recognised at fair value in the statement of financial position at the date a derivative contract is

entered into and are subsequently re-measured at fair value. The fair value of foreign currency forward contracts is determined by using

forward exchange market rates at the reporting date.

Cash flow hedges

For qualifying hedge relationships, the Group documents at the inception of the transaction the relationship between hedging instruments

and hedged items, as well as its risk management objective and strategy for undertaking the hedge. This process includes linking all

derivatives designated as hedges to specific assets and liabilities or to specific firm commitments or forecast transactions. Thereby the

qualifying instrument is separated in the spot element and forward element and only the change in the fair value of the spot element is

designated as a hedging instrument. The hedge ratio of 1:1 is applied accordingly. The Group also documents, both at the hedge inception and


RTL Group Annual Report 2023


		64

on an ongoing basis, its assessment of whether the hedging derivatives are effective in offsetting changes in fair values or cash flows of the

hedged items.

The accounting treatment applied to cash flow hedges in respect of off-balance sheet assets and liabilities can be summarised as follows:

– The designated component of fair value changes on the hedging instrument (mostly foreign currency forward contracts or cash balances in

foreign currencies) is deferred in ‘Hedging reserve’

– Amounts deferred in ‘Hedging reserve’ are subsequently released to the income statement in the periods in which the hedged item impacts

the income statement. Hedging forecast purchases of programme rights in foreign currency releases from equity when the programme

right is recognised on-balance sheet in accordance with the Group’s policy

– The non-designated component of the fair value changes on the hedging instrument is recorded directly in profit or loss.

If the hedge no longer meets the criteria for hedge accounting or the hedging instrument is sold, expires, is terminated or is exercised, then

hedge accounting is discontinued prospectively. When hedge accounting for cash flow hedges is discontinued, the amount that has been

accumulated in the ‘Hedging reserve’ remains in equity until – for a hedge of a transaction resulting in the recognition of the programme

rights – it is included in the costs of the programme rights on its initial recognition or, for other cash flow hedges, it is reclassified to profit or

loss in the same period or periods as the hedged expected future cash flows affect profit or loss. If the hedged future cash flows are no longer

expected to occur, the amounts that have accumulated in the ‘Hedging reserve’ are immediately reclassified to profit or loss.

1.6 Current/non-current distinction

Current assets are assets expected to be realised or consumed in the normal course of the Group’s operating cycle (normally within one

year). All other assets are classified as non-current assets.

Current liabilities are liabilities expected to be settled by use of cash generated in the normal course of the Group’s operating cycle (normally

within one year) or liabilities due within one year from the reporting date. All other liabilities are classified as non-current liabilities.

1.7 Intangible assets

1.7.1 Non-current programme and other rights

Non-current programme and other rights are initially recognised at acquisition cost or production cost – which includes staff costs and an

appropriate portion of relevant overheads – when the Group controls, in substance, the respective assets and the risks and rewards attached

to them.

Non-current programme and other rights include (co-)productions, audiovisual and other rights acquired with the primary intention to

distribute or trade them as part of the Group’s long-term operations. The economic benefits of the rights are highly correlated to their

consumption patterns, which themselves are linked to revenue. These non-current programme and other rights are therefore amortised

based on expected future revenue. The amortisation charge is based on the ratio of net revenue for the period over total estimated net

revenue. The (co-)production shares and flat fees of distributors are amortised over the applicable product lifecycle based on the ratio of the

current period’s revenue to the estimated remaining total revenue (ultimate revenue) for each (co-)production or distribution right.

Estimates of total net revenue are periodically reviewed and additional impairment losses are recognised if appropriate.

1.7.2 Goodwill

Business combinations are accounted for using the acquisition method as at the acquisition date. Goodwill arising from applying this method

is measured at initial recognition as detailed in note 1.3.1.

Goodwill on acquisitions of subsidiaries is recognised as an intangible asset. Goodwill is tested at least annually for impairment and carried

at cost less accumulated impairment losses. Goodwill is allocated to cash-generating units for the purpose of impairment testing. Each

cash-generating unit represents the Group’s investment in a geographical area of operation by business segment, except for Fremantle and

We Are Era which are global/multi-territory operations. RTL Deutschland has minor businesses in France and United Kingdom.

No goodwill is recognised on the acquisition of non-controlling interests.

1.7.3 Other intangible assets

Other intangible assets principally comprise brands and trademarks, software licences and developments, customer relationships and

similar rights.

Expenditures for internally developed software are capitalised only if the expenditures can be measured reliably, the product or process is

technically and commercially feasible, future economic benefits are probable, and the reporting unit intends to and has sufficient resources

to complete development and to use or sell the asset. Otherwise, it is recognised in profit or loss as incurred. Subsequently, development

expenditure is measured at cost less accumulated amortisation and any accumulated impairment losses.

Customer relationships that are identified as part of business combinations and the resulting allocation of the acquisition price are

recognised as assets. Customer relationships have a finite useful life, i.e. they are expected to be no longer usable at the end of a determined

period, and are therefore amortised on a straight-line basis over their useful life.

Other intangible assets with a definite useful life, which are acquired by the Group, are stated at cost less accumulated amortisation and

impairment losses. They are amortised on a straight-line basis over their estimated useful life as follows:

– Software licences and developments: three to seven years

– Other licences: seven to 20 years.


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		65

Useful lives are reviewed annually and adjusted if expectations have changed.

Brands and trademarks, unless an indefinite useful life can be justified, are mainly amortised on a straight-line basis over their estimated

useful life. The range of definite useful life of brands and trademarks depends individually on the underlying contractual terms of use. Brands

with an indefinite useful life are tested annually for impairment or whenever there is an indication that the intangible asset may be impaired.

1.8 Property, plant and equipment

Property, plant and equipment is stated at cost less accumulated depreciation and impairment losses. Depreciation is recognised on a

straight-line basis over the estimated useful lives of the assets as follows:

– Land: nil

– Buildings: ten to 25 years

– Technical equipment: four to ten years

– Other fixtures and fittings, tools and equipment: three to ten years.

Where an item of property, plant and equipment comprises major components having different useful lives, it is accounted for as separate

items of property, plant and equipment. Gains and losses on disposals are determined by comparing proceeds with the carrying amount and

are included in profit from operating activities.

Depreciation methods and useful lives, as well as residual values, are reassessed annually and adjusted if expectations have changed.

Expenditure incurred to replace a component of an item of property, plant and equipment that is separately accounted for is capitalised with

the carrying amount of the component that is to be replaced being written off. Other subsequent expenditure is capitalised only when it

increases the future economic benefits that will be derived from the item of property, plant and equipment. All other expenditure is expensed

as incurred.

1.9 Leases

The Group mainly leases premises for operating businesses. Leases are recognised as a right-of-use asset with a corresponding liability at

the date at which the leased asset is available for use by the Group. Each lease payment is allocated between the liability and finance cost.

The finance cost is charged to profit or loss over the lease period to produce a constant periodic rate of interest on the remaining balance of

the liability for each period.

Right-of-use assets

The Group recognises right-of-use assets at the commencement date of the lease (i.e. the date the underlying asset is available for use).

Right-of-use assets are measured at cost less any accumulated depreciation and impairment losses and adjusted for any re-measurement

of lease liabilities. The cost of right-of-use assets includes the amount of the lease liabilities recognised, initial direct costs incurred,

restoration costs, and lease payments made at, or before, the commencement date less any incentives received. Right-of-use assets are

depreciated on a straight-line basis over the shorter of the asset’s estimated useful life and the lease term. Right-of-use assets are subject to

impairment testing.

Lease liabilities

At the commencement date of the lease, the Group recognises lease liabilities measured at the present value of lease payments to be made

over the lease term. The lease payments include fixed payments (including in substance fixed payments) less any lease incentive receivable,

variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees.

The lease payments also include the exercise price of a purchase option that is reasonably certain to be exercised by the Group and

payments of penalties for terminating a lease, if the lease term reflects the Group exercising the option to terminate. The variable lease

payments that do not depend on an index or a rate are recognised as an expense in the period on which the event or condition that triggers

the payment occurs. The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be determined, the

lessee’s maturity, currency and risk-specific incremental borrowing rate is used. The incremental borrowing rate represents the cost of

obtaining external financing for a corresponding asset with a financing period corresponding to the term of the lease denominated in the

currency in which lease payments are settled.

After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease

payments. In addition, the carrying amount of lease liabilities is re-measured if there is a modification, a change in the lease term, a change in

the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset.

Short-term leases and leases of low-value assets for all classes of assets

The Group applies the short-term lease recognition exemption to its leases (i.e. those leases that have a term of 12 months or less from the

commencement date and do not contain a purchase option). It also applies the exemption of low-value leased assets. Lease payments on

short-term leases and leases of low-value assets are recognised on a straight-line basis as an expense over the lease term.

1.10 Loans and other financial assets

Initial recognition

The Group classifies its financial assets in the following measurement categories:

– those to be measured subsequently at fair value (either through OCI, or through profit or loss), and

– those to be measured at amortised cost.

The classification depends on the entity’s business model for managing the financial assets and the contractual terms of the cash flows.


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Financial assets (with the exception of trade receivables without a significant financing component) are recognised initially at fair value,

taking into account transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial

assets recognised at fair value through profit or loss are immediately expensed in profit or loss. Trade receivables without a significant

financing component are initially recognised at their transaction price.

For financial assets – debt instruments and investments in equity instruments – measured at fair value through profit or loss, gains and

losses will be recorded in either profit or loss or OCI. For investments in equity instruments that are not held for trading, this will depend on

whether the Group has made an irrevocable election at the time of initial recognition to account for the equity instrument at fair value

through other comprehensive income (FVOCI).

Financial assets with embedded derivatives are separated from the host contract and accounted for separately if the host contract is not a

financial asset and certain criteria are met.

The fair value of publicly traded investments is based on quoted market prices at the reporting date. The fair value of non-publicly traded

investments is based on the estimated discounted value of future cash flows.

Subsequent measurement

Debt instruments

Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset and the cash flow

characteristics of the asset. The Group classifies its debt instruments in three measurement categories:

– Amortised cost: assets that are held in order to collect contractual cash flows where those cash flows represent solely payments of

principal and interest. Financial assets at amortised cost are subsequently measured using the effective yield method, less any valuation

allowance for credit risk. Any difference between nominal value, net of transaction costs, and redemption value is recognised using the

effective interest method in profit or loss over the period of the loan. Interest income from these financial assets is included in ‘Interest

income’ using the effective interest method. Any gain or loss arising on derecognition is recorded directly in profit or loss and presented in

‘Other operating income’ or ‘Other operating expenses’, together with foreign exchange gains and losses. Impairment losses, when

applicable, are presented as ‘Other operating expenses’ in the consolidated income statement

– FVOCI: assets that are held in order to collect contractual cash flows and for selling the financial assets – where the assets’ cash flows

solely represent payments of principal and interest – are measured at FVOCI. Changes in the fair value are taken through OCI, except for

the recognition of impairment losses (and reversal of impairment losses), foreign exchange gains and losses and interest income, which are

recognised in profit or loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified

from equity to profit or loss and recognised in ‘Gain/(loss) from sale of subsidiaries, other investments and re-measurement to fair value of

pre-existing interest in acquiree’. Interest income from these financial assets is included in ‘Interest income’ using the effective interest

method. Impairment expenses are presented in ‘Other operating expenses’ and disclosed separately in the notes to the consolidated

income statement

– FVTPL: instruments that do not meet the criteria for amortised cost or FVOCI are measured at FVTPL. A gain or loss on a debt instrument

that is subsequently measured at FVTPL is recognised in the consolidated income statement and presented net within ‘Fair value

measurement of investments’ which is reported in ‘Other operating income’ or ‘Other operating expenses’.

The Group reclassifies debt investments when and only when its business model for managing those assets changes.

Equity instruments

The Group subsequently measures all equity instruments at fair value. Where the Group’s management has elected to present fair value

gains and losses on equity instruments in OCI, there is no subsequent reclassification of fair value gains and losses to profit or loss following

the derecognition of the investment. Dividends from such investments continue to be recognised in profit or loss as other income when the

Group’s right to receive payments is established.

Impairment losses (and reversal of impairment losses) on equity instruments at FVOCI are not reported separately from ‘Equity instruments

at FVOCI – change in fair value, net of tax’ in the revaluation reserve of the consolidated statement of changes in equity.

Changes in the fair value of financial assets at FVTPL are recognised within ‘Fair value measurement of investments’ in the consolidated

income statement.

1.11 Current programme rights

Current programme rights are initially recognised at acquisition cost or Group production cost when the Group controls, in substance, the

respective assets and the risks and rewards attached to them.

Current programme rights include programmes in progress, (co-)productions and rights acquired with the primary intention to broadcast or

sell them in the normal course of the Group’s operating cycle. Current programme rights include an appropriate portion of overheads and are

stated at the lower of cost and net realisable value. The net realisable value assessment is based on the advertising revenue expected to be

generated when broadcast, and on estimated net sales. Weak audience shares or changes from a prime-time to a late-night slot constitute

indicators that a valuation allowance may be applicable. They are consumed based on either the expected number of transmissions or


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expected revenue in order to match the costs of consumption with the benefits received. The rates of consumption applied for broadcasting

rights are as follows:

– Free television thematic channels: programme rights are consumed on a straight-line basis over a maximum of six runs

– Free television other channels:

– Blockbusters (films with high cinema ticket sales), mini-series (primarily own productions with a large budget), other films, series, TV

movies and (co-)productions are consumed, run by run, over a maximum of four transmissions following a degressive approach for

amortisation depending on the agreed total number of transmissions

– Soaps, in-house productions, quiz and game shows, sports and other events, documentaries and music shows are fully consumed upon

the first transmission

– Children’s programmes and cartoons are consumed over the licence period on a linear basis as there is a very slow saturation and a very

high number of repetitions for the target group kids (three to 13-year-olds)

– Pay television channels: programme rights are consumed on a straight-line basis over the licence period.

1.12 Impairment of non-financial assets

Assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment. Assets that are subject to

amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be

recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. For the

purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-

generating units).

The recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. In assessing value in use, and fair value

less costs of disposal where applicable, the estimated future cash flows are discounted to their present value using a discount rate after tax

that reflects current market assessments of the time value of money and the risks specific to the asset.

In respect of assets other than goodwill, an impairment loss is reversed when there is an indication that the conditions that caused the

impairment loss may no longer exist and there has been a change in the estimates used to determine the recoverable amount. The carrying

amount after the reversal of the impairment loss cannot exceed the carrying amount that would have been determined, net of depreciation

and amortisation, if no impairment loss had been recognised.

1.13 Accounts receivable and contract assets

Trade accounts receivable arise from the sale of goods and services related to the Group’s operating activities. Trade accounts receivable

are recognised initially at the amount of consideration that is unconditional, unless they contain significant financing components, in which

case they are recognised at fair value. They are subsequently measured at amortised cost using the effective interest method, less

impairment loss.

Contract assets relate to the conditional right to consideration for complete satisfaction of the contractual obligations. Other accounts

receivable include – in addition to deposits and amounts related to Profit and Loss Pooling (PLP) and Compensation Agreements with RTL

Group’s controlling shareholder – VAT recoverable, and prepaid expenses.

Impairment losses on trade accounts receivable, other financial instruments measured at amortised costs and contract assets are

recognised when:

– RTL Group assesses on a forward-looking basis the expected credit loss; or

– there is objective evidence that the Group will not be able to collect all amounts due according to the original terms. Significant financial

difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in

payments (more than 30 days overdue) are considered indicators that the trade receivable or the contract asset is impaired. In that case,

the trade receivable or the contract asset is removed from the expected credit loss and impaired on a stand-alone basis.

Additions to valuation allowance and subsequent recoveries of amounts previously written off are reported in the income statement within

‘Other operating expenses’.

Accrued income is stated at the amounts expected to be received.

1.14 Cash and cash equivalents

Cash consists of cash in hand and at bank. Cash equivalents are assets that are readily convertible into cash, such as short-term highly liquid

investments, commercial paper, bank deposits and marketable securities, all of which mature within three months from the date of purchase,

and money market funds that qualify as cash and cash equivalents under IAS 7. Bank overdrafts are included within current liabilities.

1.15 Impairment of financial assets

RTL Group applies the expected credit loss (ECL) model in accordance with IFRS 9 for debt instruments at amortised cost and for contract

assets. Accordingly, the amount of expected credit losses recognised as a loss allowance depends on the extent to which the default risk has

increased since initial recognition. According to the so-called general approach, a distinction is made between the following two

measurement bases:

– 12-month ECL: At initial recognition, and if the default risk has not increased significantly from the initial recognition of the debt instrument,

a loss allowance is recognised for expected credit losses within the next 12 months.

– Lifetime ECL: If the default risk has increased significantly, a loss allowance for expected credit losses is recognised for the entire life of the

debt instrument.


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Appropriate quantitative and qualitative information and analyses based on the Group’s past experience and reasonable assessments –

including forward-looking information such as customer-specific information and forecasts of future economic conditions – are taken into

consideration when determining the credit risk. When a financial asset is more than 30 days past due, its credit risk is assumed to have

increased significantly. A default of a financial asset is assumed at the latest when the counterparty fails to make contractual payments

within 90 days of when they fall due, unless reasonable and supportable information is available that justifies a different time of overdue

payment. The Group assesses whether a financial asset is credit-impaired at the end of each reporting period. This is the case when one or

more events that have a detrimental impact on the expected future cash flows of that financial asset have occurred. A financial asset is

written off when it is no longer reasonably expected to be fully or partially recoverable.

For trade receivables and contract assets, RTL Group uses a simplified approach to measure expected credit losses. According to this, the

loss allowance is measured using lifetime expected credit losses. For this purpose, impairment matrices based on historic bad debt losses,

maturity bands and expected credit losses have been prepared. The impairment matrices were created for business unit-specific groups of

receivables, each with similar default patterns. In addition, separate risk assessments are performed. Contract assets have substantially the

same risk characteristics as trade receivables for the same types of contracts, so that the expected loss rates for trade receivables are a

reasonable approximation of the loss rates for contract assets.

1.16 Non-current assets held for sale

Non-current assets (or disposal groups) are classified as assets held for sale when their carrying amount is to be recovered principally

through a sale transaction and a sale is considered highly probable. They are stated at the lower of the carrying amount and fair value less

costs of disposal if their carrying amount is recovered principally through a sale transaction rather than through continuing use.

1.17 Accounts payable

Trade accounts payable arise from the purchase of assets, goods and services relating to the Group’s operating activities and include

accrued expenses. Other accounts payable comprise – in addition to amounts related to the Profit and Loss Pooling Agreement (PLP) with

RTL Group’s controlling shareholder – VAT payable, fair value of derivative liabilities, and accounts payable on capital expenditure. Trade

and other accounts payable are measured at amortised cost using the effective interest method, except derivative liabilities, which are

measured at fair value.

1.18 Loans payable

Interest-bearing current and non-current liabilities are recognised initially at fair value less transaction costs. Subsequent to initial

recognition, interest-bearing current and non-current liabilities are stated at amortised cost with any difference between cost and

redemption value being recognised in the income statement over the period of the borrowings using the effective interest method.

1.19 Provisions

Provisions are recognised when the Group has a present legal or constructive obligation to transfer economic benefits as a result of past

events. The amounts recognised represent management’s best estimate of the expenditures that will be required to settle the obligation at

the reporting date. Provisions are measured by discounting the expected future cash flows to settle the obligation at a pre-tax risk-free rate

that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the obligation.

A provision for restructuring is recognised when the Group has approved a detailed and formal restructuring plan and the restructuring has

either commenced or been announced publicly. Restructuring provisions do not include costs relating to the ongoing activities of the Group.

Provisions for onerous contracts mainly relate to unavoidable costs for individual programme rights, of which the estimated performance is

clearly below what was originally planned when the contract was agreed. Such situations mainly arise in case of executory obligations to

purchase programmes that will not be aired due to lack of audience capacity or to a mismatch with the current editorial policy. In addition, an

expected or actual fall in audience can be evidenced by several indicators, such as the underperformance of a previous season, the

withdrawal of the programme’s main advertisers or a decline in the popularity or success of sports programmes. Long-term sourcing

agreements aim to secure the programme supply of broadcasters. These are mainly output deals, production agreements given European

quota obligations, and arrangements with sports organisations. The provision is measured at the present value of the lower of the expected

cost of terminating the contract and the expected net cost of continuing with the contract. Before a provision is established, the Group

recognises any impairment loss on the assets associated with that contract.

1.20 Employee benefits

1.20.1 Pension benefits

The Group operates or participates in both defined contribution and defined benefit plans, according to the national laws and regulations of

the countries in which it operates. The assets of the plans are generally held in separate trustee-administered funds, and some of the plans

are operated through pension funds that are legally independent from the Group. The pension plans are generally funded by payments from

employees and by the relevant Group companies, taking into account the recommendations of independent qualified actuaries.

Pension costs and obligations relating to defined benefit plans are recognised based on the projected unit credit method. The Group

recognises actuarial gains and losses in other comprehensive income. Past-service costs are recognised immediately through profit or loss.

Pension costs relating to defined contribution plans (including deferred compensation plans that are defined contribution plans in nature) are

recognised when an employee has rendered service in exchange for the contributions due by the employer.


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1.20.2 Other benefits

Many Group companies provide death in service benefits, and spouses’ and children’s benefits. The costs associated with these benefits are

recognised when an employee has rendered service in exchange for the contributions due by the employer.

1.20.3 Share-based transactions

In limited number of cases (currently at Groupe M6) share options are granted to directors, senior executives and other employees of the

Group. They may also be granted to suppliers for settlement of their professional services. Share options entitle holders to purchase shares at

a price (the ‘strike price’) payable at the exercise date of the options. Options are initially measured at their fair value determined on the date

of grant.

The grant date fair value of equity-settled share-based payment arrangements is recognised as an expense with a corresponding increase in

equity over the vesting period of the options. The amount recognised as an expense is adjusted to reflect the number of options that are

expected to ultimately vest, considering vesting service conditions and non-market performance conditions.

For cash settled share-based payment arrangements, the fair value of the amount payable to employees is recognised as an expense with a

corresponding increase in liability until the employees exercise their options. The liability is re-measured to fair value at each reporting date

up until the settlement date. Any changes in the liability are recognised in the income statement. The fair value of the options is measured

using specific valuation models.

1.21 Share capital

1.21.1 Equity transaction costs

Incremental external costs directly attributable to the issue of new shares, other than in connection with a business combination, are

deducted, net of the related income taxes, against the gross proceeds recorded in equity.

1.21.2 Treasury shares

Where the Company or its subsidiaries purchase the Company’s own equity, the consideration paid, including any attributable transaction

costs net of income taxes, is shown in deduction of equity as ‘Treasury shares’.

1.21.3 Dividends

Dividends on ordinary shares are recorded in the consolidated financial statements in the period in which they are approved at the

Shareholders’ meeting or authorised by the Board of Directors in case of interim dividends.

1.22 Revenue presentation and recognition

Revenue relates to advertising, the production, distribution and licensing of programmes and other rights, the rendering of services and the

sales of merchandise. Revenue is presented net of sales deductions such as cash rebates, credit notes, discounts, refunds and VAT. Revenue

comprises the fair value of the consideration received or receivable in the ordinary course of the Group’s activities. The transaction price is

determined based on the contractually agreed terms. The nature and timing of satisfaction of performance obligations and significant

payment terms differ between the respective categories of revenue, whereas payments are generally due within short time.

Revenue from advertising

Advertising arrangements mostly include spots aired or advertisements published as part of a campaign on various media (TV, radio, internet

or printed magazines), generally for a period of up to one year. RTL Group considers that the client benefits from the visibility of his brands as

the spot is broadcasted and an advertising campaign progresses. Therefore, RTL Group treats the series of spots from an advertising

customer as a single performance obligation. The same applies to advertisements in printed magazines.

Revenue from advertising is recognised over time in the period over which the related spots or advertisements are broadcasted or published.

Commissions paid to sales houses and other agencies are directly deducted from advertising revenue.

Both normal and free advertising spots of an advertising campaign are considered to be separate performance obligations and recognised

for their relative standalone selling price. Free advertising spots and printed advertisements generate a contract asset if they are aired or

published in a higher extent than the contracted normal advertising spots and printed advertisements, and a contract liability in the reverse

case.

Revenue from exploitation of programmes, rights and other assets

Revenue from exploitation of programmes, rights and other assets mostly consists of revenue generated from the production and licensing of

intellectual property to customers.

Customer contracts typically have a wide variety of performance obligations, from production licence contracts to multi-year format licence

agreements, as well as ancillary rights and services (e.g. merchandising rights, sponsorship rights and production consulting services) and

distribution activities. IFRS 15 requires an assessment of the nature of promise at contract level regarding licences and payment terms. The

Group assesses for purposes of revenue recognition whether the licences underlying the transactions are determined to be a right to access

the content (revenue recognised over time) or a right to use the content (revenue recognised at a point in time) considering the further

influence on or development of the intellectual property on which the licence is based during the contractual licence period. RTL Group has

determined that, for most of the licences granted (i.e. production licences, distribution licences, format-only licences), the involvement of the

Group is limited to the transfer of the licence, resulting in a performance obligation, which is satisfied at a point in time respectively when the

licence is granted.

Non-refundable minimum guarantees recoupable over royalties are received as part of some production or distribution arrangements, which

are recognised in accordance with the classification of the type of licence granted.


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Granting licences for the access to streaming platforms (e.g. RTL+) stipulate obligations to provide access to the content over the

subscription period. The subscription revenues are recognised in accordance with the classification of the type of licence granted, i.e. over

time.

In the case of sales-based or usage-based royalties in exchange for a licence of intellectual property, the Group recognises revenue when the

performance obligation to which some or all of the sales-based or usage-based royalty has been allocated has been satisfied (or partially

satisfied) and when the subsequent sale or usage has occurred.

In parallel, advance payments received from a customer to fulfil non-cancellable arrangements generate a contract liability.

When the customer has a right to return the product within a given period, the entity is obliged to refund the purchase price. Under IFRS 15, a

refund liability for the expected refunds to customers is recognised as an adjustment to revenue in trade and other accounts payable.

A significant part of operations developed by the digital video networks consists of distributing videos licensed by talents/influencers that are

advertising-financed. The corresponding revenue for the Group, due to a variable basis, is recognised as revenue from exploitation of

programmes, rights and other assets.

Distribution revenue is recognised when the Group’s broadcasting channels provide a broadcasting signal in high definition (HDTV) or

additional services to cable, satellite platforms and internet TV for a fee.

Revenue from selling goods and merchandise and providing services

Revenue from selling own products is recognised at a point in time when control is transferred. Depending on the underlying respective terms

of sale, this is generally upon delivery to the customer. Expected returns from sales of products, mainly from print magazines, are shown as

liabilities in the position ’Accounts payable and other liabilities’. In individual business models, giveaways to customers meet the criteria of a

separate performance obligation. Any giveaways to an agent are capitalised as costs to obtain a contract and are amortised over the

expected term of the subscription.

Revenue from selling merchandise is recognised when the customer has obtained control of the goods for the amount that the Group expects

to receive.

Revenue from providing services is recognised in the period in which the service has been rendered for the consideration that the Group

expects to receive.

For the sale of third-party goods and services and especially in the context of the Group’s digital businesses, the Group assesses whether it

operates as a principal, and reports revenue on a gross basis, or as an agent, and reports revenue on a net basis. The decision is primarily

based on who the customer is and whether the agent obtains control of the specified goods or services before they are transferred to the

customer. Other indicators include who is primarily responsible for fulfilment, inventory risk and discretion in establishing the sales price.

IFRS 15 stipulates some practical expedients of which the following are applied in RTL Group:

– Costs of obtaining contracts are not capitalised if the underlying asset is amortised in no more than 12 months

– The value of consideration is not adjusted for the effects of a material financing component if the financing component pertains to a period

of no more than 12 months

– For contracts with an original duration of no more than 12 months and for contracts for which revenue can be recognised according to the

amount invoiced for simplification purposes, no disclosure of the aggregated transaction price is provided.

1.23 Government grants

Grants from government and inter-governmental agencies are recognised at their fair value where there is a reasonable assurance that the

grant will be received, and the Group will comply with all attached conditions. Government grants related to assets are initially presented as a

deduction in arriving at the carrying amount of the asset. Grants that compensate the Group for expenses incurred are recognised in ‘Other

operating income’ on a systematic basis in the same period in which the expenses are recognised.

Forgivable loans are loans which government and inter-governmental agencies undertake to waive repayment of under certain prescribed

conditions. Forgivable loans are recognised in ‘Other operating income’ when there is reasonable assurance that the loan will be waived.

1.24 Gain and loss from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree

Gains and losses on disposal or loss of control of subsidiaries owning only one non-financial asset or a group of similar assets are classified in

‘Other operating income’/’Other operating expenses’ to reflect the substance of the transaction.

1.25 Interest income and expense

Interest income and expense is recognised on a time proportion basis using the effective interest method.

1.26 Income tax

Recognition and measurement of income tax

Income tax on the profit or loss for the year comprises current and deferred tax. Income tax is recognised in the income statement except to

the extent that it relates to items recognised directly in other comprehensive income.


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Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted in the countries

in which the Group’s entities operate, and generate taxable income at the reporting date and any adjustment to tax payable in respect of

previous years.

Deferred taxes are recognised on any temporary difference between the carrying amount for consolidation purposes and the tax base of the

Group’s assets and liabilities, as well as for unused tax loss carry forwards and tax credits. Deferred tax assets are recognised to the extent

that it is probable that future taxable profits will be available, against which the deductible temporary differences, unused tax credits and tax

loss carry forwards can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer

probable that the related tax benefit will be realised.

Deferred tax is not recognised for:

– temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects

neither accounting nor taxable profit or loss

– temporary differences related to investments in subsidiaries, associates and joint arrangements to the extent that the Group is able to

control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future

– taxable temporary differences arising on the initial recognition of goodwill.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realised or the

liability is settled, based on tax rates that have been enacted or substantively enacted at the reporting date. Deferred tax assets and

liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when the deferred

income taxes relate to the same tax authority.

Global minimum tax

With the publication of the law on 22 December 2023, Luxembourg as the country of the parent company has adopted the global minimum

top-up tax (Pillar Two). The regulations will apply to RTL Group from 1 January 2024. In addition, Pillar Two legislation has been adopted in

the following countries – which are relevant to the Group – and will come into force on 1 January 2024: Belgium, Denmark, Finland, France,

Germany, Hungary, Ireland, Italy, the Netherlands, Sweden and the United Kingdom. As the newly enacted legislation had not yet been

effective at the reporting date, RTL Group is not subject to any additional tax burden for the year ended 31 December 2023. RTL Group makes

use of the exemption for the recognition of deferred taxes in connection with Pillar Two income taxes, which was the subject of the

amendments to IAS 12 published in May 2023.

RTL Group is currently in the process of assessing the impact of Pillar Two once the legislation will become effective. The statutory tax rate in

Ireland is below 15 per cent. From the first indicative analysis, RTL Group does not expect any significant effects.

1.27 Discontinued operations

A discontinued operation is a component of the Group’s business that represents a separate major line of business or a geographical area of

operations that has been disposed of or is held for sale or distribution, or is a subsidiary acquired exclusively with a view to resale.

Classification as a discontinued operation occurs upon the earlier of disposal or when the operation meets the criteria to be classified as held

for sale. When an operation is classified as a discontinued operation the comparative income statement is re-presented as if the operation

had been discontinued from the start of the comparative year. Further information is presented in note 6.11.

1.28 Earnings per share

Basic earnings per share (EPS) is calculated by dividing the net profit attributable to RTL Group shareholders by the weighted average

number of ordinary shares in issue during the year, excluding ordinary shares purchased by the Group and held as treasury shares and the

shares held under the liquidity programme, if any.

The diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion

of all dilutive potential ordinary shares. There is currently no category of dilutive potential ordinary shares.

1.29 Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief

operating decision-maker, who is responsible for allocating resources and assessing the performance of the operating segments, has been

identified as the Executive Committee of RTL Group, which makes strategic decisions.

An operating segment is a component of the Group that engages in business activities from which it may earn revenue and incur expenses,

including revenue and expenses that relate to transactions with any of the Group’s other components.

The operating results of all operating segments are regularly reviewed by the Group’s Executive Committee, which makes decisions about

resources to be allocated to the segment and assesses its performance, and for which discrete financial information is available.

The invested capital is disclosed for each reportable segment as reported to the Group’s Executive Committee. Invested capital is calculated

on the basis of the Group’s operating assets (right-of-use assets included) less non-interest bearing operating liabilities (lease liabilities not

included). Intercompany revenues are recognised using the same arm’s-length conditions applied to transactions with third parties. No

measure of segment assets and liabilities other than invested capital is reported to the Group’s Executive Committee.


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1.30 Prior year information

In December 2023, the Group reached an agreement on the sale of RTL Nederland to DPG Media. The RTL Nederland segment was classified

as held for sale as at 31 December 2023 and presented as a discontinued operation in the consolidated financial statements 2023. Further

information is presented in note 6.11.

For the purposes of both better comparability with the Group’s peers and increased transparency of financial information, the disclosures to

the notes 6.1 Non-current programme and other rights, 6.2 Goodwill and other intangible assets and 6.8. Current programme rights have

been adjusted. The adjustments mainly relate to the designation and disaggregation of the respective line-item composition in the tables

shown in the notes. The 2022 comparatives have been adjusted accordingly. These adjustments have no effect on the presentation of

consolidated income statement and consolidated statement of financial position.

In November 2022, Fremantle acquired 55 per cent of 72 Films, an independent TV production company focusing on documentaries and

factual entertainment. Also in November 2022, Fremantle acquired 51 per cent of Wildstar Films, a production company focused on natural

history documentaries. For the year-end reporting 2022 the purchase price allocations for both acquisitions were prepared on a provisional

basis in accordance with IFRS 3. During the measurement period in 2023, the provisional amounts recognised at the acquisition date were

retrospectively adjusted to reflect new information obtained about facts and circumstances that existed as at the acquisition date. Due to the

finalisation of the purchase price allocation in the financial year 2023 the figures from the previous year in the consolidated statement of

financial position have been adjusted accordingly. Further information is presented in note 4.2.

2. Accounting judgements and estimates

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of

future events that are believed to be reasonable under the circumstances.

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the

related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts

of assets and liabilities within the next financial year are discussed below.

2.1 Consolidation of entities in which the Group holds less than 50 per cent

Even though the Group has less than 50 per cent of the voting rights of Groupe M6, management considers that the Group has control of

Groupe M6. The Group is the controlling shareholder of Groupe M6 while the balance of other holdings remains highly dispersed and the

other shareholders have not organised their interest in such a way that they intend to vote differently from the Group.

2.2 Significant influence with less than 20 per cent

Although the Group holds less than 20 per cent of the equity shares of Atresmedia, management considers that the Group exercises a

significant influence in Atresmedia in view of the representation of RTL Group on the Board of Directors and other governing bodies of

Atresmedia.

2.3 Lease accounting

Extension and termination options are included in several real estate leases across the Group. The Group applies judgement in evaluating

whether it is reasonably certain to exercise the option and considers all relevant factors that create an economic incentive to exercise the

option. After the commencement date, the Group re-assesses the lease term if there is a significant event or change in circumstances that is

within its control and affects its ability to exercise the option or not to exercise the option. Most of the extension and termination options held

are exercisable only by the Group and not by the respective lessor. Incremental borrowing rates determined by currency and maturity are

updated on a yearly basis unless a triggering event occurs.

2.4 Programme and other rights (assets and provisions for onerous contracts)

The Group’s accounting for non-current programme rights requires estimates by management as it relates to total net revenue used in the

determination of the amortisation charge and impairment loss for the year.

In addition, management estimates must consider factors such as the future programme grid, the realised/expected audience of the

programme, the current programme rights that are not likely to be broadcast, and the related valuation allowance.

Provisions for onerous contracts related to programme and other rights are also recognised when the Group has constructive obligations, and

it is probable that unavoidable costs exceed the economic benefits originally planned. These provisions have been determined by discounting

the expected future cash inflows for which the amount and timing are dependent on future events.

2.5 Estimated impairment of goodwill, intangible assets with indefinite useful life and investments accounted for using the equity

method

The Group tests at least annually whether goodwill and intangible assets with indefinite useful life have suffered any impairment. The Group

also tests annually whether investments accounted for using the equity method have suffered any impairment, and if any impairment should

be reversed.


RTL Group Annual Report 2023


		73

The Group has used a combination of long-term trends, industry forecasts and in-house knowledge – with greater emphasis on recent

experience – in forming its assumptions about the development of the various advertising markets in which the Group operates. This is an

area highly exposed to general economic conditions. The state of the advertising market is just one of the key operational drivers used by the

Group to assess individual business models. Other key drivers (non-IFRS measures) include audience shares, advertising market shares,

EBITA and EBITA margin, and operating cash conversion rates. Each of these elements is variable, inter-related and difficult to isolate as the

main driver of the various business models and respective valuations.

The Group performs sensitivity analysis of the recoverable amount of the cash-generating units, especially on those where the headroom

between the recoverable amount and the carrying amount is low.

2.6 Contingent consideration and put option liabilities on non-controlling interests

Contingent consideration, resulting from business combinations, is valued at fair value at the acquisition date as part of the business

combination, and subsequently re-measured at each reporting date. The determination of the fair value is based on discounted cash flow and

takes into account the probability of meeting each performance target. Put option liabilities on non-controlling interests are recognised at the

present value of the redemption amount in case of exercise of the option by the counterparty. Further, put option liabilities are sensitive to

forecasted performance targets as they are based on a multiple of earnings, and judgement is required where there may be adjustments to

forecasted results or to the probability of meeting each performance target.

2.7 Fair value of equity instruments at fair value through OCI

The Group has used discounted cash flow analysis for the equity instruments at FVOCI that were not traded in active markets.

2.8 Assets held for sale and discontinued operations

The determination of the fair value less costs to sell requires management judgement as it relates to estimates of proceeds of the disposal,

residual obligations and direct disposal costs. The classification as assets held for sale and discontinued operations also requires

management judgement.

2.9 Provisions for litigations

Most claims involve complex issues, and the probability of loss and an estimation of damages are difficult to ascertain. A provision is

recognised when the risk of a loss becomes more likely than not and when it is possible to make a reasonable estimate of the expected

financial effect. RTL Group management reviews on a regular basis the expected settlement of the provisions.

2.10 Income tax, deferred tax and other taxes

The Group is subject to income and other taxes in numerous jurisdictions. There are transactions and calculations for which the ultimate tax

determination is uncertain during the ordinary course of business.

Uncertain tax positions and future tax benefits are based on assumptions and estimations that may arise from the interpretation of tax

regulations. An asset or liability arising from an uncertain tax position is recognised in accordance with IAS 12 if a payment or reimbursement

for the uncertain tax position is probable. The valuation of the uncertain tax positions is based on their most probable amount in accordance

with IFRIC 23. Deferred tax assets are recognised in the amount in which they are likely to be utilised later. Various factors are used to assess

the probability of the future usability of deferred tax assets. This includes, among others, corporate and tax planning strategies.

2.11 Post-employment benefits

Post-employment benefits rely on several assumptions such as:

– The discount rate determined by reference to market yields at the closing on high-quality corporate bonds (such as corporate AA bonds)

and depending on the duration of the plan

– Estimation of future salary increases, mainly taking into account inflation, seniority, promotion, and supply and demand in the employment

market.

2.12 Recognition of revenue

In the event of return rights, mostly for print products, estimates must be made with regard to the anticipated return volume, as revenues are

recognised taking the anticipated returns into account. Return ratios determined using statistical methods are used to identify the

anticipated returns. The transaction prices to be determined using the contract-based five-step model defined in IFRS 15 often include both

fixed and variable consideration. The variable components are determined on the basis of estimates, which are made and updated in

accordance with constraint conditions. For various business models, qualitative estimates must be made as part of principal-agent

considerations as to who is to be regarded as a customer of an RTL Group company and whether an RTL Group company is to be regarded as

principal or agent in a transaction.

2.13 Contingent liabilities

Contingent liabilities are disclosed unless management considers that the likelihood of an outflow of economic benefits is remote.


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		74

3. Segment reporting

The determination of the Group’s operating segments is based on the operational and management-related entities for which information is

reported to the Executive Committee.

The Group has 14 business units (of which Atresmedia is accounted for using the equity method) at 31 December 2023, each one led by a

CEO. The Group owns interests in 60 television channels, seven streaming services and 36 radio stations, of which 10 TV channels, three radio

stations and a streaming service are held by Atresmedia as an associate (see note 6.5.2).

In addition, Fremantle and We Are Era operate global/multi-territory businesses in content, digital video and advertising.

The following reported segments meet the quantitative thresholds required by IFRS 8:

– RTL Deutschland: RTL Deutschland is the Group’s largest business unit and Germany’s first cross-media champion, operating across TV,

streaming, radio, digital and publishing. RTL Deutschland owns 15 TV channels, the multimedia offering RTL+, 15 magazines, a broad

podcast portfolio and numerous digital offerings, such as chefkoch.de and wetter.de. RTL Radio is one of Germany’s largest privately

owned radio groups, with holdings in 25 stations including Antenne Bayern and Radio Hamburg

– Groupe M6: this segment represents a multimedia group in France which focuses on three areas: television (13 channels including M6, the

second largest commercial channel in the French market), radio (three stations including RTL, the leading radio station in France) and

digital (streaming platforms and other digital businesses)

– Fremantle: RTL Group’s global content production business includes a significant distribution and licensing business (international) and

operates in 27 countries.

As at 31 December 2022, RTL Nederland was also presented as a separate operating segment. As at 31 December 2023, RTL Nederland was

classified as held for sale and presented as a discontinued operation in the consolidated financial statements 2023. Further information is

presented in note 6.11.

The revenue of ‘Other segments’ amounts to €350 million (2022: €411 million). In 2023, the major contributors are RTL Hungary with

€125 million and We Are Era with €64 million. The remaining amount of €161 million is, among others, attributable to the RTL Group’s

Luxembourgish activities and Bedrock. In 2022 , the major contributors were RTL Hungary with €113 million, We Are Era with €64 million, RTL

Belgium (before disposal) with €40 million and RTL Croatia (before disposal) with €19 million.

The Group’s Corporate Centre, which provides services and initiates projects, is also reported in ‘Other segments’.

RTL Group’s Executive Committee primarily assesses the performance of the operating segments based on Adjusted EBITA. Interest income,

interest expense, other financial income, other financial expenses and income tax are not allocated to segments, as these are centrally

managed. Inter-segment pricing is determined on an arm’s length basis.

The Executive Committee also reviews, on a regular basis, the amount of the invested capital of each business unit.

As a rule, all management financial information reported to RTL Group’s Executive Committee is fully compliant and consistent with the

Group’s accounting policies and primary statements, except intercompany leases. For segment reporting, intercompany leases are presented

as operating leases with income and expenses recognised using the straight-line method in accordance with IFRS 8, in line with internal

management.


RTL Group Annual Report 2023


		75

3.1 Segment information


	RTL Deutschland		Groupe M6		Fremantle		RTL Nederland (discontinued operations)¹		Other segments²		Eliminations		Total Group
	2023	2022	2023	2022	2023	2022	2023	2022	2023	2022	2023	2022	2023	2022
	€m	€m	€m	€m	€m	€m	€m	€m	€m	€m	€m	€m	€m	€m

Revenue from external customers	2,600	2,766	1,315	1,352	2,040	2,147	620	635	279	324	–	–	6,854	7,224
Inter-segment revenue	20	–	1	5	226	200	–	1	71	87	(318)	(293)	–	–
Total revenue	2,620	2,766	1,316	1,357	2,266	2,347	620	636	350	411	(318)	(293)	6,854	7,224

Depreciation, amortisation and impairment including on goodwill and on fair value adjustments on acquisitions of subsidiaries	(90)	(76)	(88)	(105)	(70)	(62)	(9)	(9)	(34)	(34)	–	–	(291)	(286)

Share of results of investments accounted for using the equity method	19	25	10	(34)	–	1	1	–	32	22	–	–	62	14
Impairment and reversals of investments accounted for using the equity method	–	(5)	–	–	–	–	–	–	–	–	–	–	–	(5)

Adjusted EBITDA	403	525	387	394	184	203	154	170	44	23	1	8	1,173	1,323
Adjusted EBITA	321	459	311	304	139	162	145	161	11	(12)	–	9	927	1,083

Adjusted EBITA margin (in %)	12.3	16.6	23.6	22.4	6.1	6.9	23.4	25.3	3.1	(2.9)	n/a	n/a	13.5	15.0

Invested capital	1,542	1,464	1,441	1,419	2,067	1,980	202	167	435	390	6	5	5,693	5,425

1 The operating segment RTL Nederland was classified as held for sale and presented as a discontinued operation in the consolidated financial statements 2023. Further information is presented in

note 6.11.

2 Other segments include the Adjusted EBITA loss of €-2 million generated by Group Corporate Centre (2022: €-31 million).


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		76

The following table shows the reconciliation of segment information to the consolidated financial statements.


	2023	2022
	€m	€m

Adjusted EBITDA¹	1,019	1,153
Depreciation, amortisation and impairment²	(237)	(231)
Adjusted EBITA	782	922
Impairment of goodwill of subsidiaries	–	–
Amortisation and impairment of fair value adjustments on acquisitions of subsidiaries	(43)	(46)
Impairment and reversals of investments accounted for using the equity method	–	(5)
Impairment and reversals on other financial assets at amortised cost	(2)	(30)
Re-measurement of earn-out arrangements	(9)	–
Fair value measurement of investments	(23)	(78)
Gain/(loss) from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree	40	107
Significant special items	(125)	(42)
Earnings before interest and taxes (EBIT)	620	828
Financial result	(13)	(56)
Profit before tax from continuing operations	607	772
Income tax expense	(124)	(130)
Group profit from continuing operations	483	642

1 After deduction of discontinued operations

2 Without depreciation, amortisation and impairment included in ‘Significant special items’

In 2023, ‘Significant special items’ amount to €-125 million, reflecting mainly restructuring measures at RTL Deutschland (€-87 million) and

personnel cost efficiency measures at Fremantle (€-26 million). The remaining amount is attributable to expenses in connection with

strategic portfolio measures and to the transformation project relating to a new Enterprise Resource Planning (ERP) solution where

implementation costs were expensed as incurred. In 2022, ‘Significant special items’ reflected restructuring and integration costs in Germany

(€-33 million) following the Gruner + Jahr transaction as well as the impact of expenses in connection with strategic portfolio management

(€-11 million).

3.2 Geographical information

Geographical areas are based on where customers (revenue) and the Group’s non-current assets are located. Goodwill has been allocated to

a geographical area based on whether the Group’s risks and returns are affected predominantly by the products and services it produces.


	Germany		France		United States		UK		Other regions		Total Group (continuing operations)
	2023	2022	2023	2022	2023	2022	2023	2022	2023	2022	2023	2022
	€m	€m	€m	€m	€m	€m	€m	€m	€m	€m	€m	€m

Revenue from external customers	2,413	2,593	1,318	1,367	1,015	1,002	301	313	1,187	1,314	6,234	6,589
Non-current assets¹	1,669	1,738	1,137	1,183	500	507	588	583	406	598	4,300	4,609
Assets held for sale	–	–	–	–	–	–	–	–	416	–	416	–
Capital expenditure	67	391	87	114	13	28	10	160	50	60	227	753

1 Non-current assets comprise intangible assets (including goodwill), property, plant and equipment, and right-of-use assets

The revenue generated in Luxembourg amounts to €79 million (2022: €86 million). The total of non-current assets other than investments

accounted for using the equity method, financial instruments, deferred tax assets and post-employment benefit assets located in

Luxembourg amounts to €55 million (2022: €60 million).


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		77

4. Group composition

4.1 Scope of consolidation

RTL Deutschland, Fremantle and RTL Nederland are wholly owned by RTL Group. Additionally, RTL Group is the controlling shareholder of

Groupe M6 with ownership interest of 48.4 per cent (after considering treasury shares held by Groupe M6), and groups further investments

under ‘Other segments’, including RTL Hungary, We Are Era, RTL Group’s Luxembourgish activities, Bedrock and Atresmedia.

The following table shows the composition of the scope of consolidation excluding the parent company RTL Group SA, based in Luxembourg:


	Subsidiaries		Joint ventures¹		Associates¹		Total
	2023	2022	2023	2022	2023	2022	2023	2022

RTL Deutschland	67	67	2	2	13	14	82	83
Groupe M6	46	47	5	5	6	4	57	56
Fremantle	170	174	2	2	1	1	173	177
RTL Nederland	8	8	2	2	2	2	12	12
Other segments	36	39	–	–	3	3	39	42
Total	327	335	11	11	25	24	363	370

1 The joint ventures and associates included in the table are investments accounted for using the equity method.

The following table shows the changes of the scope of consolidation excluding the parent company RTL Group SA, based in Luxembourg:


	Germany	France	United States	The Netherlands	UK	Other regions	Total

Consolidated as at 31 December 2022	84	63	44	21	58	100	370
Additions	1	4	1	–	2	4	12
Disposals	6	4	–	–	1	8	19
Consolidated as at 31 December 2023	79	63	45	21	59	96	363

A total of 53 (2022: 61) companies were excluded from the scope of consolidation. These consist of entities without significant business

operations and of negligible importance for the financial position and financial performance of RTL Group as a whole.

The complete list of RTL Group’s undertakings as at 31 December 2023 is presented in note 12.

4.2 Acquisitions

In the financial year 2023, the cash flow from acquisition activities totalled €-44 million, of which, after consideration of cash and cash

equivalents acquired, €-1 million relates to new acquisitions during the reporting period. In the financial year 2022, the cash flow from

acquisition activities without acquisition of businesses under common control totalled €-113 million, and the total cash flow from acquisition

activities considering acquisition of businesses under common control totalled €53 million. The consideration transferred in accordance with

IFRS 3 amounted to €1 million in 2023 (2022: €201 million taking into account contingent consideration of €31 million). In the financial

year 2022, also put options were recognised in the amount of €149 million in connection with the acquisitions.

RTL Group made several acquisitions in 2023, none of which were material on a stand-alone basis. In total, the impact of these acquisitions

on the Group’s financial position and financial performance was also minor.

In November 2022, Fremantle acquired 55 per cent of 72 Films, an independent TV production company focusing on documentaries and

factual entertainment. At the acquisition date, the estimated consideration transferred amounted to €51 million, of which €44 million was

paid in cash. Earn-out consideration was estimated at €7 million. Also in November 2022, Fremantle acquired 51 per cent of Wildstar Films, a

production company focused on natural history documentaries. At the acquisition date, the estimated consideration transferred amounted to

€19 million, of which €13 million was paid in cash. The earn-out consideration was estimated at €5 million and the deferred payment at

€1 million. For the year-end reporting 2022 the purchase price allocations for both acquisitions were prepared on a provisional basis in

accordance with IFRS 3. During the measurement period, the Group finalised the valuation of the intangible assets recognised on acquisition

and liabilities assumed on acquisition and thus the figures from the previous year in the consolidated statement of financial position have

been adjusted accordingly.

The following table summarises the recognised amounts of assets acquired and liabilities assumed after completion of the purchase price

allocation in comparison with published financial statements for the year-end 2022.


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		78


	72 Films		Wildstar Films
	Published in 2022	Restated in 2023	Published in 2022	Restated in 2023
	€m	€m	€m	€m

Non-current assets
Other intangible assets	–	16	–	5
Property, plant and equipment	1	1	3	3
Right-of-use assets	–	–	2	2
Other non-current assets	2	–	–	–
Current assets
Programme rights	12	7	–	–
Trade and other accounts receivable	4	4	7	7
Other current assets	1	1	3	3
Cash and cash equivalents	7	7	17	17

Liabilities
Lease liabilities	–	–	(2)	(2)
Other liabilities	(25)	(22)	(21)	(22)
Net assets acquired	2	14	9	13
Goodwill	50	49	14	18
Non-controlling interests	(1)	(6)	(4)	(6)
Consideration transferred according to IFRS 3	51	57	19	25

4.3 Disposals

After the announcement of the reorganisation of its publishing business in February 2023, RTL Deutschland completed in the second half-

year transactions, among others, the sale of PM, Deutsche Medien-Manufaktur and 11 Freunde. The disposals resulted in net cash inflows of

€4 million. Net of transaction-related costs, the transactions resulted in an overall gain of €11 million recognised in ‘Gain/(loss) from sale of

subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree’.

In July 2023, RTL Group sold its majority stake in CTZAR to the Group The Independents which resulted in net cash inflows of €3 million. Net

of transaction-related costs, the transaction resulted in an overall gain of €2 million recognised in ‘Gain/(loss) from sale of subsidiaries, other

investments and re-measurement to fair value of pre-existing interest in acquiree’.

In September 2023, Groupe M6 sold its thematic online media and services businesses, comprising eight main brands: Cuisine AZ, Passeport

Santé, Fourchette & Bikini, Déco, Turbo, M6 météo, Croq’Kilos and Croq’Body to Prisma Media (owned by Vivendi), which resulted in net cash

inflows of €20 million. Net of transaction-related costs, the transaction resulted in an overall gain of €10 million recognised in ‘Gain/(loss)

from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree’.

During the financial year 2023, RTL Group sold other subsidiaries, none of which was material on a standalone basis. In total, the impact of

these disposals on the Group’s financial position and financial performance was also minor.

From all disposals in the financial year 2023 and from disposal effects of previous years, RTL Group generated cash flows totalling

€32 million (2022: €194 million) after considering cash and cash equivalents disposed of. The disposals led to a gain from deconsolidation of

€23 million (2022: €112 million), which is recognised in ‘Gain/(loss) from sale of subsidiaries, other investments and re-measurement to fair

value of pre-existing interest in acquiree’. The following table shows their impact on RTL Group’s assets and liabilities at the time of

deconsolidation.


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		79


	RTL Deutschland’s publishing assets	Group M6’s thematic online media and services businesses	CTZAR	Other	Total
	€m	€m	€m	€m	€m

Non-current assets
Goodwill	6	10	3	1	20
Other intangible assets	5	9	–	–	14
Right-of-use assets	1	–	–	–	1
Deferred tax assets	4	–	–	–	4
Current assets
Other inventories	3	–	–	–	3
Accounts receivable and other current assets	2	1	2	–	5
Other current assets	1	–	–	–	1
Cash and cash equivalents	22	1	3	1	27

Liabilities
Loans	–	–	(1)	–	(1)
Lease liabilities	(1)	–	–	–	(1)
Income tax payable	(1)	–	–	–	(1)
Accounts payable and other liabilities	(15)	(2)	(2)	–	(19)
Contract liabilities	(7)	–	(1)	–	(8)
Provisions	(2)	–	–	–	(2)
Deferred tax liabilities	(4)	–	–	–	(4)
Net assets disposed of	14	19	4	2	39

5. Details on consolidated income statement

5.1 Revenue

Revenue is disaggregated below by nature and timing of recognition. The table also includes a reconciliation with reportable segments.


	RTL Deutschland		Groupe M6		Fremantle		Other segments		Total Group (continuing operations)
	2023	2022	2023	2022	2023	2022	2023	2022	2023	2022
	€m	€m	€m	€m	€m	€m	€m	€m	€m	€m

Nature of revenue recognition
Revenue from advertising	1,881	2,053	1,069	1,084	39	16	122	166	3,111	3,319
Revenue from exploitation of programmes, rights and other assets	369	334	181	174	1,990	2,112	98	89	2,638	2,709
Revenue from selling goods and merchandise and providing services	350	379	65	94	11	19	59	69	485	561
	2,600	2,766	1,315	1,352	2,040	2,147	279	324	6,234	6,589

Timing of revenue recognition
At a point in time	235	353	76	94	1,912	2,035	94	63	2,317	2,545
Over time	2,365	2,413	1,239	1,258	128	112	185	261	3,917	4,044
	2,600	2,766	1,315	1,352	2,040	2,147	279	324	6,234	6,589

‘Revenue from advertising’ consists mostly of TV advertising, radio advertising, print and other advertising. RTL Group’s revenue from

advertising was €3,111 million (2022: €3,319 million), of which €2,368 million represented TV advertising revenue (2022: €2,579 million),

€371 million represented digital advertising revenue (2022: €361 million) and €372 million represented radio, print and other advertising

revenue (2022: €379 million).


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		80

‘Revenue from exploitation of programmes, rights and other assets’ include primarily content revenue of €1,990 (2022: €2,112) generated by

the Group’s global content business, Fremantle, from the production and distribution of formats for external customers. Further, it includes

distribution revenue generated by RTL Group’s broadcasting businesses, mainly from re-transmission fees paid by platform operators (cable,

satellite, internet TV) for the transmission of free-TV and pay-TV signals and for making the Group’s streaming services available on the

operators’ platforms. In 2023, distribution revenue was €331 million (2022: €332 million). Also included is SVOD revenue from the Group’s

major streaming services and, among others, Groupe M6’s audiovisual rights business SND and We Are Era.

‘Revenue from selling goods and merchandise and providing services’ relates to a variety of revenue streams, including commissions for

handling advertising sales for third-party media partners, publishing subscriptions, e-commerce and a wide range of services businesses

such as the technical services provider BCE, the streaming technology company Bedrock or the real-estate franchise Stéphane Plaza

Immobilier at the level of Groupe M6.

The following table shows how much of the revenue recognised in the reporting period relates to carried forward contract liabilities and how

much relates to performance obligations that were satisfied in previous periods:


	2023	2022
	€m	€m

Revenue recognised that was included in the contract liabilities balance at the beginning of the period	539	553
Revenue recognised from performance obligations satisfied in previous periods	–	–

As at 31 December 2023, RTL Group expects future revenues from existing long-term agreements of €50 million (2022: €77 million), which

will be attributable to unsatisfied (or partially unsatisfied) performance obligations as at the end of the reporting period and is expected to be

recognised in the amount of €30 million (2022: €41 million) in the next financial year and in the amount of €20 million (2022: €36 million) in

the following years.

The decrease in current contract liabilities from €590 million at 31 December 2022 to €481 million at 31 December 2023 related mainly to

Fremantle and RTL Deutschland.

5.2 Other operating income

The other operating income amounting to € 102 million (2022: €83 million) mainly consists of income-related grants, reimbursements and

IFRS 16 effects due to a decrease of rented space.

5.3 Other operating expenses


	2023	2022
	€m	€m

Employee benefits expenses	1,262	1,251
Production subcontracting expenses	433	438
Intellectual property expenses	296	294
Expenses related to live programmes	180	218
Repairs and maintenance	150	141
Marketing and promotion expenses	137	142
Transmission expenses including satellite capacity	87	89
Audit and consulting fees	75	75
Operating taxes	60	55
Rentals and other lease expenses	43	38
Consumption of other inventories	33	58
Fair value measurement of investments	23	78
Marketing and promotion barter expenses	27	22
Commissions on sales	15	15
Re-measurement of earn-out arrangements	9	–
Valuation allowance	2	34
Administration and sundry expenses	137	77
	2,969	3,025


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		81

In the financial years 2023 and 2022, the item ‘Fair value measurement of investments’ included among others effects from the valuation of

Magnite shares. The item ‘Rentals and other lease expenses’ includes expenses from short-term leases of €18 million ( 2022: €17 million).

Expenses for low-value assets and expenses from variable lease payments, which are not included in the lease liabilities, are immaterial for

RTL Group. In 2022, the item ‘Valuation allowance’ included the impairment of a loan provided by Groupe M6 to Salto due to the voluntary

liquidation of Salto decided unanimously by its three shareholders (see note 6.5.1).

The item ‘Audit and consulting fees’ includes fees related to the Group’s auditor, KPMG, and its affiliates regarding continuing operations.

These are set out below:


	2023	2022
	€m	€m

Audit services pursuant to legislation	3.8	3.5
Audit-related services	0.6	0.5
Non-audit services	0.1	0.3
	4.5	4.3

Employee benefits expenses are set out in more detail below:


	2023	2022
	€m	€m

Wages and salaries	932	966
Termination benefits	91	27
Social security costs	186	190
Share options granted to employees	4	5
Pension costs	10	19
Other employee expenses	39	44
	1,262	1,251
Of which restructuring costs	44	5

The amounts set out above exclude personnel costs of €248 million (2022: €307 million), which are capitalised, and which represent

employee costs directly allocated to the production of assets.

In addition to other short-term bonus schemes, RTL Group has implemented for its senior management a long-term incentive plan

(RTL Group LTIP 2023-2025 ‘ LTIP’) which runs for the term 2023 to 2025. The liability related to the LTIP Tranche 2023 amounted to

€8 million at 31 December 2023 (LTIP Tranche 2022: €14 million at 31 December 2022). Further details on the terms and conditions of the

LTIP are contained in the RTL Group Remuneration Report. RTL Group operates a sub-plan for senior management of Fremantle (New

Format Incentive Scheme 2023-2025 ‘NFIS2021-2023’). NFIS2023-2025 is a long-term plan based on cumulative creative targets. The

creative target achievement is linked to a defined ranking scheme set out for new productions created and marketed during the plan’s term.

The liability related to the NFIS2023-2025 amounted to €nil at 31 December 2023.

Groupe M6 operates a specific long-term incentive plan based on free shares plans (see note 6.16.7). Pension costs for the Group relate to

defined contributions for €17 million (2022: €14 million) and defined benefit plans for €-2 million (2022: €10 million).

The average number of employees for undertakings held by the Group is set out below:


	2023	2022

Employees of fully consolidated undertakings (continuing operations)	12,095	12,241
Employees of fully consolidated undertakings (continuing and discontinued operations)	12,835	12,975


RTL Group Annual Report 2023


		82

5.4 Interest income and interest expense


	2023	2022
	€m	€m

Interest income on loans and accounts receivable	13	4
Tax-related interest income	–	1
Interest income	13	5

Interest expense on financial liabilities	(36)	(18)
Interest expense	(36)	(18)

In the financial year 2023, RTL Group witnessed a significant increase in interest income and expense, largely attributed to the prevailing

interest rate environment. The rise in interest rates, as a response to monetary policy adjustments by central banks, had positively impacted

interest-bearing financial assets, mainly held by Groupe M6. The respective amount of €8 million disclosed in ‘Interest income on loans and

accounts receivables’ relates to Groupe M6 (2022: €1 million).

‘Interest expense on financial liabilities’ includes an amount of €29 million (2022: €14 million) in respect of the loans from Bertelsmann

Business Support Sàrl (see note 10.1).

5.5 Other financial income and other financial expenses


	2023	2022
	€m	€m

Gains resulting from swap points	7	1
Net gains on put/call options	21	–
Sundry financial income	16	4
Other financial income	44	5

Net losses on put/call options	–	(4)
Interest expense on lease liabilities	(7)	(6)
Interest on defined benefit obligations	(6)	(4)
Sundry financial expenses	(21)	(34)
Other financial expenses	(34)	(48)

‘Net gains on put/call options’ reflects the re-measurement of the put option liabilities with regards to acquisitions of subsidiaries with put/

call option arrangements by Fremantle conducted during the last years. RTL Group closely monitors the forecast performance of each

acquisition and, where there has been a change in expectations, the value of put option liabilities are adjusted. These values are sensitive to

forecast profits as they are based on a multiple of earnings.

Interest on defined benefit obligations comprises interest income on plan assets of €5 million (2022: €2 million) and unwind of discount on

defined benefit obligations of €-11 million (2022: €-6 million).

‘Sundry financial income’ includes among others non-operating foreign exchange effects of €9 million (2022: €-19 million presented in

‘Sundry financial expenses’) and income of €5 million from financial assets held for cash management purposes by Groupe M6. ‘Sundry

financial expenses’ includes among others a negative impact of unwinding discount of €-6 million (2022: €-3 million), the net wealth tax of

€-4 million (2022: €-3 million) and finance charges for guarantees and other commitments fees in total of €-4 million (2022: €-3 million).

5.6 Income tax expense


	2023	2022
	€m	€m

Current taxes from continuing operations	(113)	(140)
Deferred taxes from continuing operations	(11)	10
	(124)	(130)


RTL Group Annual Report 2023


		83

In 2023, the change in the income tax expense compared to the previous year is due to lower profit before tax and positive impacts from the

valuation of deferred tax assets realised in the previous period.

The income tax on the Group profit before tax differs from the theoretical amount that would arise using the Luxembourg tax rate as follows:


	2023	2022
	€m	€m

Profit before tax from continuing operations	607	772

Income tax rate applicable to RTL Group SA (in %)	24.94	24.94

Expected tax expense from continuing operations	(151)	(193)

The tax effects of the following items led to differences between the expected and actual tax expense:
Adjustment to different national tax rates	(9)	(15)
Effect of changes in tax rate and tax law	1	2
Tax effects in respect of results from disposals of investments	5	32
Current income taxes for previous years	(1)	8
Deferred income taxes for previous years	(4)	(4)
Effects of measurements of deferred tax assets	20	48
Commission received in relation to the Compensation Agreement	10	16
Permanent differences	12	(19)
Other adjustments	(7)	(5)
Total adjustments	27	63

Actual tax expense from continuing operations	(124)	(130)

Effect of tax rates in material foreign jurisdictions mainly results from the differentiated rates applicable in the following countries:

– Germany, where the official tax rate is 32.10 per cent, representing an impact of €-9 million (2022: €-17 million with a tax rate of

32.10 per cent)

– France, where several tax rates apply, depending on the size of the business. The rates of 25.83 and 25.00 per cent apply, representing an

impact of €-2 million (2022: the rates of 25.83 and 25.00 per cent applied, representing an impact of €-2 million)

– United States, where the official tax rate is 23.40 per cent, representing an impact of €1 million (2022: €3 million with a tax rate of 21.90 per

cent).

‘Effects of measurements of deferred tax assets‘ considers the recognition of deferred tax assets on losses carry forward based on

projections of the future taxable income derived from financial budgets approved by management. ‘Permanent differences’ mainly include

the effects of non-taxable income and tax effects from equity investments. In 2022, this position mainly included effects of non-taxable fair

value measurements of investments.


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		84

5.7 Earnings per share

The determination of basic earnings per share is based on the profit attributable to RTL Group shareholders of €467 million (2022:

€673 million) and a weighted average number of ordinary shares outstanding during the year of 154,742,806 (2022: 154,742,806), calculated

as follows:


	2023	2022

Group profit attributable to RTL Group shareholders (in € million)	467	673
– Continuing operations	352	549
– Discontinued operations	115	124

Weighted average number of ordinary shares:
Issued ordinary shares at 1 January	154,742,806	154,742,806
Weighted average number of ordinary shares	154,742,806	154,742,806

Basic earnings per share (in €)	3.02	4.35
– Continuing operations	2.27	3.55
– Discontinued operations	0.74	0.80

Diluted earnings per share (in €)	3.02	4.35
– Continuing operations	2.27	3.55
– Discontinued operations	0.74	0.80


RTL Group Annual Report 2023


		85

6. Details on consolidated statement of financial position

6.1 Non-current programme and other rights


	(Co-) productions	Audiovisual rights for distribution	Advance payments and (co-) productions in progress	Total
	€m	€m	€m	€m

Cost
Balance at 1 January 2022	891	1,205	38	2,134
Effects of movements in foreign exchange	26	–	1	27
Additions	1	32	39	72
Disposals	–	(39)	(1)	(40)
Subsidiaries acquired	1	–	–	1
Subsidiaries disposed of	–	–	–	–
Transfer to assets held for sale	–	–	–	–
Transfers and other changes	13	23	(34)	2
Balance at 31 December 2022	932	1,221	43	2,196

Effects of movements in foreign exchange	(15)	–	–	(15)
Additions	9	–	53	62
Disposals	–	(37)	–	(37)
Subsidiaries acquired	–	–	–	–
Subsidiaries disposed of	–		–	–
Transfer to assets held for sale	–	(6)	–	(6)
Transfers and other changes	14	37	(57)	(6)
Balance at 31 December 2023	940	1,215	39	2,194

Amortisation and impairment losses
Balance at 1 January 2022	(879)	(1,175)	(6)	(2,060)
Effects of movements in foreign exchange	(27)	–	–	(27)
Amortisation charge	(17)	(59)	–	(76)
Impairment losses	–	2	(1)	1
Disposals	–	39	1	40
Transfer to assets held for sale	–	–	–	–
Transfers and other changes	(1)	–	–	(1)
Balance at 31 December 2022	(924)	(1,193)	(6)	(2,123)

Effects of movements in foreign exchange	15	–	–	15
Amortisation charge	(15)	(46)	–	(61)
Impairment losses	–	–	–	–
Disposals	–	37	–	37
Transfer to assets held for sale	–	6	–	6
Transfers and other changes	–	–	–	–
Balance at 31 December 2023	(924)	(1,196)	(6)	(2,126)

Carrying amount:
At 31 December 2022	8	28	37	73
At 31 December 2023	16	19	33	68

The figures presented on long-term audiovisual rights for distribution are attributable to the Groupe M6 and Fremantle subsidiaries which

focus in particular on the production and distribution of films, series and other content for the future exploitation in multiple markets and

exploitation windows.


RTL Group Annual Report 2023


		86

6.2 Goodwill and other intangible assets


	Goodwill	Software licences and development	Brands and trademarks	Sundry other intangible assets	Advance payments	Total other intangible assets
	€m	€m	€m	€m	€m	€m

Cost
Balance at 1 January 2022	5,507	225	323	370	20	938
Effects of movements in foreign exchange	–	(1)	–	(1)	–	(2)
Additions	–	12	–	2	63	77
Disposals	–	(13)	–	(1)	–	(14)
Subsidiaries acquired	323	9	–	60	2	71
Subsidiaries disposed of	(1)	–	–	(8)	–	(8)
Transfer to assets held for sale	–	–	–	–	–	–
Transfers and other changes	–	61	–	4	(66)	(1)
Balance at 31 December 2022	5,829	293	323	426	19	1,061

Effects of movements in foreign exchange	(6)	–	–	–	–	–
Additions	–	9	–	6	50	65
Disposals	–	(5)	–	(4)	–	(9)
Subsidiaries acquired	1	–	–	–	–	–
Subsidiaries disposed of	(20)	–	–	(5)	–	(5)
Transfer to assets held for sale	(159)	(12)	–	(13)	(5)	(30)
Transfers and other changes	–	49	–	(3)	(45)	1
Balance at 31 December 2023	5,645	334	323	407	19	1,083

Amortisation and impairment losses
Balance at 1 January 2022	(2,497)	(168)	(8)	(236)	(1)	(413)
Effects of movements in foreign exchange	(1)	–	–	2	–	2
Amortisation charge	–	(34)	(8)	(34)	–	(76)
Impairment losses	–	(2)	–	–	–	(2)
Disposals	–	13	–	5	–	18
Transfer to assets held for sale	–	–	–	–	–	–
Transfers and other changes	–	3	–	(2)	–	1
Balance at 31 December 2022	(2,498)	(188)	(16)	(265)	(1)	(470)

Effects of movements in foreign exchange	1	–	–	–	–	–
Amortisation charge	–	(46)	(7)	(34)	–	(87)
Impairment losses	–	–	–	–	–	–
Disposals	–	4	–	4	–	8
Transfer to assets held for sale	–	10	–	13	–	23
Transfers and other changes	–	(3)	1	2	–	–
Balance at 31 December 2023	(2,497)	(223)	(22)	(280)	(1)	(526)

Carrying amount:
At 31 December 2022	3,331	105	307	161	18	591
At 31 December 2023	3,148	111	301	127	18	557

‘Software licences and development’ includes primarily capitalised costs associated to the RTL+ streaming platform in Germany and the

Bedrock platform for other streaming services.

‘Brands and trademarks’ with an indefinite and finite useful life for an overall amount of €301 million (2022: €307 million), primarily related to

brands within Groupe M6 (the M6 brand, Gulli-related brands and Stéphane Plaza brand) and RTL Deutschland (the Toggo brand). M6 brand

and Gulli-related brands are considered to have an indefinite useful life and were recognised for an amount of €120 million and €38 million,

respectively (2022: €120 million and €38 million). At 31 December 2023, an impairment test was performed for brands with indefinite useful

life and did not lead to any impairment.

In determining that the M6 brand has an indefinite useful life, management has considered various factors such as the historical and

expected longevity of the brand, the impact of possible changes in broadcasting technologies, the impact of possible evolutions of the

regulatory environment in the French television industry, the current and expected audience share of the M6 channel, and M6 management’s

strategy to maintain and strengthen the trademark ‘M6’. Based on the analysis of these factors, management has determined and confirmed

at 31 December 2023, that there is no foreseeable limit to the period over which the brand M6 is expected to generate cash inflows for the

Group. Gulli-related brands correspond to Gulli, Canal J and Tiji. Given their positioning, the market’s awareness of the brands and their

history, they are considered to have an indefinite useful life.


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		87

The brands Stéphane Plaza and Toggo with a net book value of €47 million and €89 million respectively (2022: €49 million and €94 million)

are considered to have a finite useful life.

‘Sundry other intangible assets’ with a definite useful life mainly include customer relationships resulting from the acquisition of Jeunesse TV

in 2019 with a net book value of €38 million (2022: €41 million), franchising contracts of Stéphane Plaza amounting to €33 million (2022:

€35 million) and customer relationships and contracts acquired resulting from the recent acquisitions by Fremantle amounting to

€36 million (2022: €56 million).

Goodwill is allocated to the Group’s cash-generating units (CGUs) on the basis of the business units and at the level at which independent

cash flows are generated.

Business units and CGUs mainly operate in one country, except Fremantle and We Are Era, which have global/multi-territory operations. RTL

Deutschland has minor businesses in France and the United Kingdom. Goodwill is allocated by CGU as follows:


	31 December 2023	31 December 2022
	€m	€m

RTL Deutschland	1,264	1,269
Groupe M6	600	613
Fremantle	1,251	1,256
RTL Nederland	–	159
We Are Era	32	32
Others	1	2
Total goodwill on cash-generating units	3,148	3,331

Goodwill is tested for impairment annually, on 31 December, or whenever changes in circumstances indicate that the carrying amount may

not be recoverable.

The recoverable amount of a CGU has been determined on the basis of the higher of its value in use and its fair value less costs of disposal:

– The value in use is determined on the basis of cash flows excluding estimated future cash inflows or outflows expected to arise from future

restructurings and from improving or enhancing the CGU’s performance unless the CGUs committed at year-end to the restructuring, and

related provisions have been made. Furthermore, the discount rate is closely linked to peer group parameters. Specific country risk and

inflation differentials are also considered.

– Fair value less costs of disposal is the amount obtainable from the sale of a CGU in an arm’s length transaction between knowledgeable,

willing parties, less the costs of disposal. When available, market quoted prices are used.

The Group supports its fair values less costs of disposal on market-based valuations, if an active market exists, and on the basis of a

discounted cash flow (DCF) model to the extent that it would reflect the value that ‘any market participant’ would be ready to pay in an arm’s

length transaction. Differently from the ‘value in use’ approach, which reflects the perspective of the Group for a long-term use of the CGU, a

‘fair value less costs of disposal’ DCF model would include future cash flows expected to arise from restructuring plans and future

investments, as all rational market participants would be expected to undertake these restructurings and investments in order to extract the

best value from the acquisition.

Furthermore, the discount rate of each CGU is calculated based on a market approach and most of the parameters used are derived from

market sources. The discount rates are based on a mixed interest rate represented by the weighted average cost of equity and cost of capital

(WACC) after tax. The discount rates reflect the time value of money and the perception of risk associated with projected future cash flows,

both from the equity shareholders’ and the debt holders’ point of view.

The discount rates have been determined, CGU by CGU, and embody, where appropriate, the following factors:

– country risk

– inflation rate differential

– specific firm premium

– specific tax rate

– credit spread

– gearing ratio.

The recoverable amount of all CGUs is based on their fair value less costs of disposal and is a Level 3 fair value measurement, with the

exception of Groupe M6 which is listed on Euronext Paris, Compartment A (Paris Stock Exchange). As at 31 December 2023, the market price

of Métropole Télévision shares on the Paris Stock Exchange was €12.94 (2022: €15.35). The recoverable amount of Groupe M6 at that date

was based on value in use using a discounted cash flow method (Level 3), as management considered the share price of Groupe M6 did not

fully reflect its earning potential due to the expected growth in AVOD offers. The value in use determined exceeded the carrying amount.


RTL Group Annual Report 2023


		88

Cash flow projections are based on financial budgets approved by management covering a three-year period. Cash flows beyond the three-

year period for a total of up to five years are prepared using the estimated growth rates and other key drivers. For the cash-generating units’

operating advertising revenue, the projections consider audience and advertising market shares, the EBITA margin, operating cash conversion

rates based on past performance, and expectations regarding market development. Management also relies on wider macro-economic

indicators from external sources to verify the appropriateness of its own budgeting assumptions. Finally, the market positions of the Group’s

channels are also reviewed in the context of the competitive landscape, including the impact of new technologies and consumption habits.

For Fremantle, which operates a multi-territory/worldwide and diversified operation, the expected growth rate is determined according to a

weighted average of growth expectations of its multiple regions, markets and product offerings.

Cash flows beyond the three and five-year period are extrapolated using the estimated perpetual growth and EBITA margin rates and

applying the discount rates stated below.

The perpetual growth and EBITA margins are based on the expected outcome of the strategy implemented by the Group in the different

markets, on macro-economic and industry trends, and on in-house estimates.

Capital expenditure is assumed to be in line with depreciation and amortisation. Management also considers that the moderate perpetual

growth would not result in a significant increase of the net working capital.


	2023		2022
	Perpetual growth rate	Discount rate	Perpetual growth rate	Discount rate
	% a year	%	% a year	%

Cash-generating units
RTL Deutschland	0.5	8.1	0.5	7.4
Groupe M6	0.5	8.7	0.0	8.2
Fremantle	1.8	8.0	1.8	8.0
RTL Nederland	n/a	n/a	0.5	7.4
We Are Era	2.0	9.8	2.0	12.4

For the CGU Fremantle, in the event of an increase in the discount rate by 1.2 percentage points, a decrease in the long-term growth rate by

2.2 percentage points or a decrease in the EBITA margin by 1.2 percentage points, the recoverable amount would fall below the carrying

amount.

For the CGU We are Era, in the event of an increase in the discount rate by 1.6 percentage points, a decrease in the long-term growth rate by

2.2 percentage points or a decrease in the EBITA margin by 0.9 percentage points, the recoverable amount would fall below the carrying

amount.

For other CGUs, management considers that, at 31 December 2023, no reasonably possible change in the market shares, EBITA margin and

operating cash conversion rates would reduce the headroom between the recoverable amounts and the carrying amounts of the CGUs to

zero, when the recoverable amount is solely based on a DCF approach.


RTL Group Annual Report 2023


		89

6.3 Property, plant and equipment


	Land, buildings and improvements	Technical equipment	Other	Total
	€m	€m	€m	€m

Cost
Balance at 1 January 2022	386	313	237	936
Effect of movements in foreign exchange	–	(2)	(1)	(3)
Additions	12	13	30	55
Disposals	(3)	(12)	(24)	(39)
Subsidiaries acquired	7	3	6	16
Subsidiaries disposed of	(3)	(16)	(4)	(23)
Transfer to assets held for sale	–	–	–	–
Transfers and other changes	–	(1)	1	–
Balance at 31 December 2022	399	298	245	942

Effect of movements in foreign exchange	–	–	–	–
Additions	5	16	36	57
Disposals	(2)	(12)	(20)	(34)
Subsidiaries acquired	–	–	–	–
Subsidiaries disposed of	–	–	–	–
Transfer to assets held for sale	(9)	(16)	(13)	(38)
Transfers and other changes	1	4	(6)	(1)
Balance at 31 December 2023	394	290	242	926

Depreciation and impairment losses
Balance at 1 January 2022	(222)	(265)	(185)	(672)
Effect of movements in foreign exchange	–	1	1	2
Depreciation charge	(16)	(18)	(24)	(58)
Disposals	5	30	23	58
Transfer to assets held for sale	–	–	–	–
Balance at 31 December 2022	(233)	(252)	(185)	(670)

Effect of movements in foreign exchange	–	–	–	–
Depreciation charge	(16)	(18)	(27)	(61)
Disposals	1	11	20	32
Transfer to assets held for sale	8	15	7	30
Balance at 31 December 2023	(240)	(244)	(185)	(669)

Carrying amount:
At 31 December 2022	166	46	60	272
At 31 December 2023	154	46	57	257


RTL Group Annual Report 2023


		90

6.4 Right-of-use assets

Depreciation, additions and carrying amounts of right-of-use from leased property, plant and equipment are as follows:


	Land, buildings and improvements	Technical equipment	Other equipment, fixtures, furniture and office equipment	Total
	€m	€m	€m	€m

Balance at 1 January 2023	335	1	6	342
Effect of movements in foreign exchange	(1)	–	–	(1)
Depreciation charge	(77)	(1)	(3)	(81)
Additions	34	–	4	38
Transfer to assets held for sale	(16)	–	(2)	(18)
Other changes	(10)	–	–	(10)
Balance at 31 December 2023	265	–	5	270


	Land, buildings and improvements	Technical equipment	Other equipment, fixtures, furniture and office equipment	Total
	€ m	€ m	€ m	€ m

Balance at 1 January 2022	277	1	5	283
Effect of movements in foreign exchange	(1)	–	–	(1)
Depreciation charge	(72)	–	(4)	(76)
Additions	76	–	5	81
Other changes	55	–	–	55
Balance at 31 December 2022	335	1	6	342

6.5 Investments accounted for using the equity method

As at 31 December 2023, investments in 11 joint ventures (31 December 2022: 11) and 25 associates (31 December 2022: 24) were accounted

for in the consolidated financial statements.

The amounts recognised in the consolidated statement of financial position are as follows:


	2023	2022
	€m	€m

Associates	401	370
Joint ventures	4	6
Balance at 31 December	405	376

The amounts recognised in the income statement are as follows:


	2023	2022
	€m	€m

Share of results of investments accounted for using the equity method
Associates	59	33
Joint ventures	2	(20)
	61	13

Impairment and reversals of investments accounted for using the equity method
Associates	–	(5)
Joint ventures	–	–
	–	(5)


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		91

In the year 2023, dividends received from investments accounted for using the equity method amounted to €45 million (2022: €53 million).

This amount is considered as an adjustment in ‘Financial results including net interest expense and share of results of investments accounted

for using the equity method’ when calculating cash flows from operating activities.

6.5.1 Investments in joint ventures

Individually material joint venture

As at 31 December 2023, RTL Group had no joint venture, which, in the opinion of management, is material to the Group.

Individually immaterial joint venture

The following table shows summarised financial information on joint ventures that management considers individually immaterial. The

information provided represents RTL Group’s interest in each case.


	2023	2022
	€m	€m

Non-current assets	4	10
Current assets	43	66
Non-current liabilities	4	4
Current liabilities	52	85

Earnings after taxes from continuing operations	2	(20)
Earnings after taxes from discontinued operations	1	1
Other comprehensive income	–	–
Total comprehensive income	3	(19)

In March 2022, Groupe M6 subscribed to a capital increase of the joint venture Salto (the streaming platform held jointly by Groupe M6, TF1

and France Télévisions) for €41 million by offsetting its receivable held in its shareholder current account. Further, Groupe M6 provided Salto

with a loan which, in substance, forms part of its investment in Salto. The proposed Groupe M6/Groupe TF1 merger having been abandoned,

and in the absence of satisfactory offers for a sale of the platform, the three shareholders of Salto have unanimously decided to proceed with

the voluntary liquidation of Salto. According to IAS 28.14A RTL Group applied IFRS 9 to the loan and recognised in 2022 an impairment

amount of €-28 million through profit or loss presented in ‘Impairment and reversals on other financial assets at amortised cost’ as part of

‘Other operating expenses’.

In February 2023, the France Télévisions, M6 and TF1 groups announced the amicable dissolution of Salto following the abandonment of the

planned merger between TF1 and M6. The platform closed on 27 March 2023. The costs of the withdrawal for each of the partners were

recognised by way of provision as at 31 December 2022, over and above their share of Salto’s net loss for the year. Thus, the excess of

€15 million was recognised as a provision as at 31 December 2022. During the financial year 2023 the provision was fully utilised.

6.5.2 Investments in associates

Individually material associates

Set out below are the associates of the Group at 31 December 2023, which, in the opinion of the management, are material to the Group:


Name of entity	Country of incorporation	Principal activity	Percentage ownership interest		Measurement method
			2023	2022

Atresmedia	Spain	Broadcasting TV	18.7	18.7	At equity
Global Savings Group (GSG)	Germany	Shopping rewards	31.5	41.5	At equity
RTL 2 Fernsehen GmbH & Co KG	Germany	Broadcasting TV	35.9	35.9	At equity

Atresmedia Corporación de Medios de Comunicación S.A. (and subsidiaries, ‘Atresmedia’) is listed on the Madrid Stock Exchange. Based on

the published share price at 31 December 2023, the market capitalisation of 100 per cent of Atresmedia amounts to €811 million, i.e.

€3.59 per share (2022: €721 million, i.e. €3.19 per share). Global Savings Group (GSG) is a private company providing shopping rewards

activities and there is no quoted market price available for its shares. RTL 2 Fernsehen GmbH & Co KG is a private company and there is no

quoted market price available for its shares.


RTL Group Annual Report 2023


		92

The following table shows summarised financial information for Atresmedia, Global Savings Group (GSG) and RTL 2 Fernsehen GmbH & Co

KG. The information disclosed represents the amounts included in the financial statements of the material associates plus adjustments from

using the equity method, and not RTL Group’s share of these amounts.


	Atresmedia		Global Savings Group (GSG)		RTL 2 Fernsehen GmbH & Co KG
	2023	2022	2023	2022	2023	2022
	€m	€m	€m	€m	€m	€m

Non-current assets	702	686	378	189	64	63
Current assets	762	825	116	87	72	70
Current liabilities	(437)	(529)	(138)	(128)	(94)	(34)
Non-current liabilities	(267)	(295)	(128)	(56)	(6)	(47)
Net assets	760	687	228	92	36	52

Revenue	970	951	237	167	237	256
Earnings after taxes from continuing operations	171	112	20	(34)	26	38
Earnings after taxes from discontinued operations	–	–	–	–	–	–
Other comprehensive income	(8)	127	–	–	–	–
Total comprehensive income	163	239	20	(34)	26	38
Dividends received from associates	17	18	–	–	15	19

Earnings after taxes from continuing operations of Atresmedia includes the net effect of a lower income tax expense of €53 million due to the

recognition of unused tax credits. The timing and recoverable amounts of these credits were re-estimated by Atresmedia in line with ruling

11/2024 issued on 18 January 2024 by Spain's Constitutional Court repealing Royal Decree Law 3/2016.

The reconciliation of the summarised financial information shown to the carrying amount of the interest in each material associate in the

consolidated financial statements is shown in the following table:


	Atresmedia		Global Savings Group (GSG)		RTL 2 Fernsehen GmbH & Co KG
	2023	2022	2023	2022	2023	2022
	€m	€m	€m	€m	€m	€m

Net assets at 31 December	760	687	228	92	36	52
Proportionate equity	142	128	62	38	12	17
Goodwill	166	166	42	42	24	24
Impairment on investments accounted for using the equity method	(110)	(110)	–	–	–	–
Carrying amount	198	184	104	80	36	41

In January 2023, Global Savings Group (GSG), an at-equity investment held by Groupe M6, completed the acquisition of Pepper.com. This

transaction resulted in a dilution of Groupe M6’s investment in GSG. Groupe M6 holds 31.47 per cent at 31 December 2023 compared to 41.49

per cent at 31 December 2022. The positive impact on profit or loss amounted to €15 million in 2023 and was recognised under ‘Gain/(loss)

from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree’ of the consolidated income

statement.

Investments in associates are tested for impairment according to the similar methodology applied for the impairment test of goodwill.

The perpetual growth and discount rates used are as follows:


	2023		2022
	Perpetual growth rate	Discount rate	Perpetual growth rate	Discount rate
	% a year	%	% a year	%

Atresmedia	0.0	9.8	0.0	10.0
RTL 2 Fernsehen GmbH & Co KG	0.5	7.8	0.5	6.7

As at 31 December 2023, the investment in Atresmedia was tested for impairment in accordance with IAS 36. The recoverable amount of

Atresmedia on 31 December 2023 was based on the value in use determined using a discounted cash flow model, as management


RTL Group Annual Report 2023


		93

considered the share price of Atresmedia did not fully reflect its earning potential, which includes the diversification strategy through

expansion of its investment portfolio, strengthening its digital streaming offers and building its leading position in locally relevant content

production. The ongoing challenging economic environment in Spain combined with strong competition, changing viewing preferences and

continued dependence on linear television continues to lead to high uncertainty in terms of forecasts. As at 31 December 2023 neither

additional impairment loss nor reversal of impairment loss had to be recognised on the at equity investment in Atresmedia.

As at 31 December 2023, the share price of Atresmedia was €3.59 ( 31 December 2022: €3.19) which results in a fair value less costs of

disposal of €149 million for the 18.7 per cent held by RTL Group (31 December 2022: €132 million).

The assumptions based on the value in use using a discounted cash flow model are shown in the above table.

Management has identified that a reasonably possible change in one of the three key assumptions could cause the carrying amount to

exceed the recoverable amount. In the event of an increase in the discount rate by 0.9 percentage points, a decrease in the long-term growth

rate by 1.3 percentage points or a decrease in the EBITA margin by 0.8 percentage points, the recoverable amount would fall below the

carrying amount.

In November 2019, the Spanish Competition Authority (CNMC) arrived at a decision in disciplinary proceedings imposing a fine on

Atresmedia and Mediaset and barring both operators from specified courses of conduct. The parties were ordered to take steps to align their

commercial and contractual relations to the requirements of the decision. The fine imposed on Atresmedia amounts to €38.2 million. In 2020,

Atresmedia challenged the decision by filing an application for judicial review with the Administrative Chamber of the Audiencia Nacional,

Spain’s national court. The application was found admissible. Consequently, Atresmedia will proceed with an appeal in the aforementioned

court. The directors and legal advisors of Atresmedia believe that the application for judicial review against the CNMC’s decision is likely to

succeed. No provision has been recognised.

For Global Savings Group no triggering events for an impairment test have been identified.

The recoverable amount of RTL 2 Fernsehen GmbH & Co KG has been determined on the basis of the fair value less costs of disposal at

31 December 2023. This is a Level 3 fair value measurement.

Individually immaterial associates

The following table shows summarised financial information on associates that management considers individually immaterial. The

information given represents RTL Group’s interest in each case.


	2023	2022
	€m	€m

Non-current assets	55	53
Current assets	61	72
Non-current liabilities	7	8
Current liabilities	44	50

Earnings after taxes from continuing operations	10	12
Earnings after taxes from discontinued operations	–	–
Other comprehensive income	–	1
Total comprehensive income	10	13


RTL Group Annual Report 2023


		94

6.6 Loans and non-current other assets


	2023	2022
	€m	€m

Loans and other financial assets
Equity instruments at FVOCI	32	29
Equity instruments at FVTPL	13	6
Debt instruments at FVTPL	3	3
Derivative financial assets	4	14
Loans receivable to investments accounted for using the equity method	7	8
Other loans receivable	5	5
Trade accounts and other receivables	48	46
	112	111
Other non-financial assets
Net defined benefit asset	2	2
	2	2
	114	113

Equity instruments at FVOCI comprise those instruments which are not held for trading and which the group has irrevocably elected at initial

recognition to recognise in this category. These are strategic investments, mainly in radio activities.

In December 2022, RTL Group sold its entire shareholding held by Fremantle in Beyond International Limited, a company listed on the

Australian Stock Exchange. Beyond International Limited was a Level 1 fair value measurement. In 2022, RTL Group recorded an increase in

the fair value of this equity instrument at FVOCI of €1 million.

The movements in equity instruments at FVOCI are as follows:


	2023	2022
	€m	€m

Balance at 1 January	29	37
Net acquisitions and disposals	–	(3)
Change in fair value	3	(5)
Balance at 31 December	32	29

6.7 Deferred tax assets and liabilities


	2023	2022
	€m	€m

Deferred tax assets	302	316
Deferred tax liabilities	(69)	(79)
Net deferred tax assets	233	237


	2023	2022
	€m	€m

Net deferred tax assets at 1 January	237	245
Income tax income/(expense)	(12)	11
Income tax credited/(charged) to other comprehensive income	5	(29)
Change in consolidation scope	3	9
Transfer to assets held for sale	(1)	(1)
Transfers and other changes	1	2
Net deferred tax assets at 31 December	233	237


RTL Group Annual Report 2023


		95

The amount of the tax benefit arising from a previously unrecognised tax loss that is used to reduce current tax expense amounts to

€nil million (2022: €1 million).

The recognition of previously unrecognised tax loss carry forwards and deductible temporary differences resulted in a reduction in deferred

tax expense of €58 million (2022: €74 million).

Of ‘Income tax credited/(charged) to other comprehensive income’ an amount of €3 million (2022: €-2 million) relates to effective portion of

changes in fair value of cash flow hedges, €nil million (2022: €nil million) relates to recycling of cash flow hedge reserve, €3 million (2022:

€-29 million) relates to defined benefit plan actuarial gains/(losses) and € -1 million (2022: €2 million) relates to change in fair value of

equity instruments at FVOCI. The cumulative amount of deferred tax assets recognised in other comprehensive income amounts to

€2 million (2022: €-3 million).

Deferred tax assets are recognised to the extent that realisation of the related tax benefit through the future taxable profits is probable. The

Group has not recognised deferred tax assets in respect of the following items:


	2023	2022
	€m	€m

Tax loss carry forwards
No expiration date	3,928	4,007
Expiration within 5 years	58	68
Expiration after 5 years	13	11
Deductible temporary differences (no expiration date)	14	11

At 31 December 2023, there were temporary differences of €197 million (2022: €171 million) related to investments in subsidiaries. However,

deferred tax liabilities on these temporary differences were not recognised because the Group controls the dividend policy of its subsidiaries

– i.e. the Group controls the timing of reversal of the related taxable temporary differences and these will not reverse in the foreseeable

future.

The movement in deferred tax assets and liabilities during the year is as follows:


	Balance at 1 January 2023	(Charged)/ credited to income statement	Charged to other comprehen- sive income	Change in consolidation scope	Transfers and other changes	Balance at 31 December 2023
	€m	€m	€m	€m	€m	€m

Deferred tax assets
Intangible assets	67	(7)	–	–	(4)	56
Programme rights	139	(16)	–	1	–	124
Property, plant and equipment	4	–	–	–	–	4
Right-of-use assets and lease liabilities	104	(22)	–	–	(1)	81
Provisions	87	(17)	3	–	–	73
Tax loss carry forwards	95	41	–	–	–	136
Others	84	(11)	1	–	–	74
Offset	(264)				18	(246)
	316	(32)	4	1	13	302

Deferred tax liabilities
Intangible assets	(155)	1	–	–	5	(149)
Programme rights	(2)	–	–	–	–	(2)
Property, plant and equipment	(14)	–	–	–	–	(14)
Right-of-use assets and lease liabilities	(91)	18	–	–	1	(72)
Provisions	(39)	–	(1)	2	–	(38)
Others	(42)	1	2		(1)	(40)
Offset	264				(18)	246
	(79)	20	1	2	(13)	(69)


RTL Group Annual Report 2023


		96


	Balance at 1 January 2022	(Charged)/ credited to income statement	Charged to other comprehen- sive income	Change in consolidation scope	Transfers and other changes	Balance at 31 December 2022
	€m	€m	€m	€m	€m	€m

Deferred tax assets
Intangible assets	67	(12)	–	11	1	67
Programme rights	168	(29)	–	–	–	139
Property, plant and equipment	3	1	–	–	–	4
Right-of-use assets and lease liabilities	93	10	–	2	(1)	104
Provisions	95	(11)	(24)	27	–	87
Tax loss carry forwards	18	75	–	3	(1)	95
Others	92	(13)	(2)	6	1	84
Offset	(214)				(50)	(264)
	322	21	(26)	49	(50)	316

Deferred tax liabilities
Intangible assets	(131)	(4)	–	(20)	–	(155)
Programme rights	(2)	2	–	(2)	–	(2)
Property, plant and equipment	(13)	–	–	(1)	–	(14)
Right-of-use assets and lease liabilities	(80)	(10)	–	(2)	1	(91)
Provisions	(24)	(4)	(3)	(9)	1	(39)
Others	(41)	6	–	(6)	(1)	(42)
Offset	214				50	264
	(77)	(10)	(3)	(40)	51	(79)

Deferred tax assets and liabilities are offset against each other if they relate to the same tax authority and meet the criteria of offsetting. The

term of the deferred taxes on temporary differences is mostly expected to be recovered or settled more than 12 months from the balance

sheet date.

6.8 Current programme rights


	2023			2022
	Gross value	Valuation allowance	Net value	Gross value	Valuation allowance	Net value
	€m	€m	€m	€m	€m	€m

(Co-)productions and TV programmes	627	(340)	287	595	(339)	256
Audiovisual rights for broadcasting	561	(113)	448	589	(164)	425
Audiovisual rights for distribution	134	(87)	47	113	(87)	26
Sub-total programme rights	1,322	(540)	782	1,297	(590)	707

(Co-)productions and programmes in progress	661	(13)	648	713	(15)	698
Advance payments on (co-)productions, programmes and rights	132	–	132	169	–	169
Sub-total programme rights in progress	793	(13)	780	882	(15)	867
	2,115	(553)	1,562	2,179	(605)	1,574

Additions and reversals of valuation allowance have been recorded for €-31 million and €73 million respectively in 2023 (2022: €-48 million

and € 58 million, respectively).


RTL Group Annual Report 2023


		97

6.9 Accounts receivable and other current assets


	2023	2022
	€m	€m

Accounts receivable and other financial assets
Trade accounts receivable	1,230	1,301
Contract assets	5	10
Accounts receivable from investments accounted for using the equity method	23	18
Loans receivable to investments accounted for using the equity method	1	–
Derivative financial assets	14	38
Equity instruments at FVTPL	99	127
Convertible loans at FVTPL	2	–
Other current financial assets	9	6
Current deposits with shareholder and its subsidiaries	76	276
Account receivable from shareholder in relation with PLP Agreement	28	306
Other accounts receivable	88	108
	1,575	2,190

Other non-financial assets
Prepaid expenses	102	93
Sundry other non-financial assets	273	220
	375	313
	1,950	2,503

‘Equity instruments at FVTPL’ includes the minority investment in Magnite amounting to €95 million ( 31 December 2022: €123 million) as

well as a number of minority investments held by different entities. The fair value of the listed investment in Magnite is measured on the basis

of its market value. The gains and losses resulting from changes in the fair value are recognised in ‘Fair value measurement of investments’

as presented in note 5.3.

Additions and reversals of valuation allowance have been recorded for €-18 million and €19 million respectively in 2023 (2022: €-26 million

and €19 million respectively).

6.10 Cash and cash equivalents


	2023	2022
	€m	€m

Cash in hand and at bank	420	333
Fixed term deposits (under three months) and money market funds	155	256
Cash and cash equivalents (excluding bank overdrafts)	575	589


	2023	2022
	€m	€m

Cash and cash equivalents (excluding bank overdrafts)	575	589
Bank overdrafts	(2)	(1)
Cash and cash equivalents and bank overdrafts	573	588

As at 31 December 2023, ‘Cash in hand and at bank’ in the amount of €2 million was subject to restrictions on disposals (2022: €3 million).

6.11 Assets classified as held for sale and discontinued operation

As at 15 December 2023, the Group has reached an agreement on the intended sale of RTL Nederland to DPG Media, a leading multi-media

company active in the Netherlands, Belgium and Denmark. Subject to regulatory approvals and the consultation process with the respective

works councils, the all-cash transaction is expected to close around mid-2024. The total consideration on a debt- and cash-free basis and


RTL Group Annual Report 2023


		98

with a normalised net working capital, to be paid at closing, amounts to €1.1 billion. The capital gain from the transaction will be largely tax

exempt and will amount to approximately €0.8 billion.

As part of the sale, RTL Group and DPG Media will enter into a strategic partnership, spanning from technology to advertising sales and

content: At the time of closing of the transaction, the service agreements for RTL Nederland in the areas of streaming technology (via

Bedrock), broadcasting operations (via RTL Group’s technical services provider BCE) and international advertising sales (via RTL AdAlliance)

will be renewed for at least three years. RTL Nederland will also continue to use the solutions provided by RTL Group’s ad-tech business,

Smartclip. For three years after closing, RTL Group’s broadcasters in Germany, France and Hungary will receive first-look rights for all new

programmes developed by RTL Nederland. Based on a separate trademark license agreement, DPG Media will continue to use the ‘RTL’

brand in the Netherlands at least until December 2034.

The operating segment RTL Nederland was classified as held for sale and presented as a discontinued operation in the consolidated financial

statements 2023. The comparative consolidated income statement and consolidated statement of comprehensive income as well as the

consolidated cash flow statement have been restated on a full-year basis to show the discontinued operation separately from continuing

operations.

Financial information relating to the discontinued operation is as follows:


	2023	2022
	€m	€m

Revenue	620	635
Expenses	(475)	(475)
Group profit from discontinued operations before taxes	145	160
Income tax	(30)	(36)
Group profit from discontinued operations	115	124

Attributable to:
RTL Group shareholders	115	124
Non-controlling interests	–	–

Basic earnings per share from discontinued operations (in €)	0.74	0.80
Diluted earnings per share from discontinued operations (in €)	0.74	0.80


RTL Group Annual Report 2023


		99

The item ‘Expenses’ includes fees related to the Group’s auditor, KPMG, and its affiliates in the amount of €0.4 million (2022: €0.3 million).


		31 December 2023
		€m

Assets
Non-current assets
Goodwill		159
Other intangible assets		7
Property, plant and equipment		8
Right-of-use assets		18
Investments accounted for using the equity method		5
Deferred tax assets		1

Current assets
Programme rights		96
Accounts receivable and other current assets		122

Impairment on assets held for sale		–

Assets held for sale		416

Liabilities
Non-current liabilities
Lease liabilities		20
Accounts payable and other liabilities		2
Provisions		4

Current liabilities
Provisions		4
Lease liabilities		4
Accounts payable and other liabilities		182
Contract liabilities		11

Liabilities related to assets held for sale		227


	2023	2022
	€m	€m

Net cash from/(used in) operating activities	77	140
Net cash from/(used in) investing activities	(5)	(3)
Net cash from/(used in) financing activities	(72)	(137)
Net increase/(decrease) in cash and cash equivalents from discontinued operations	–	–

As at 31 December 2022, RTL Group had no assets classified as held for sale.


RTL Group Annual Report 2023


		100

6.12 Loans, bank overdrafts and lease liabilities


	Under 1 year	Over 1 year	Total carrying amount
2023	€m	€m	€m

Bank overdrafts	2	–	2
Bank loans payable – fixed rate	54	68	122
Bank loans payable – floating rate	24	17	41
Loans due to investments accounted for using the equity method – floating rate	2	–	2
Term loan facility due to shareholders and their subsidiaries – fixed rate	170	600	770
Other loans payable – fixed rate	–	4	4
Other loans payable – floating rate	1	–	1
	253	689	942

Lease liabilities	76	225	301


	Under 1 year	Over 1 year	Total carrying amount
2022	€m	€m	€m

Bank overdrafts	1	–	1
Bank loans payable – fixed rate	22	133	155
Bank loans payable – floating rate	3	–	3
Loans due to investments accounted for using the equity method – floating rate	–	–	–
Term loan facility due to shareholders and their subsidiaries – fixed rate	511	–	511
Other loans payable – fixed rate	–	5	5
Other loans payable – floating rate	10	–	10
	547	138	685

Lease liabilities	85	300	385

As at 31 December 2023, potential future cash outflows of €194 million (undiscounted) have not been included in the lease liabilities as it is

not reasonably certain that the leases will be extended (or not terminated) ( 2022: €179 million).

6.13 Accounts payable and other liabilities


	Under 1 year	Over 1 year	Total carrying amount
2023	€m	€m	€m

Accounts payable and other financial liabilities
Trade accounts payable	1,237	39	1,276
Accounts payable to investments accounted for using the equity method	10	–	10
Derivative financial liabilities	29	2	31
Account payable to shareholder in relation to PLP Agreement	–	–	–
Sundry financial liabilities	63	138	201
	1,339	179	1,518

Non-financial liabilities
Employee benefits liability	165	318	483
VAT payables	99	–	99
Deferred income	21	1	22
Social security and other taxes payable	90	–	90
	375	319	694

	1,714	498	2,212


RTL Group Annual Report 2023


		101


	Under 1 year	Over 1 year	Total carrying amount
2022	€m	€m	€m

Accounts payable and other financial liabilities
Trade accounts payable	1,360	40	1,400
Accounts payable to investments accounted for using the equity method	8	–	8
Derivative financial liabilities	43	14	57
Account payable to shareholder in relation to PLP Agreement	322	–	322
Sundry financial liabilities	118	167	285
	1,851	221	2,072

Non-financial liabilities
Employee benefits liability	249	287	536
VAT payables	132	–	132
Deferred income	3	–	3
Social security and other taxes payable	89	–	89
	473	287	760

	2,324	508	2,832

At 31 December 2023, the profit participation liabilities of RTL Deutschland amounted to €313 million ( 2022: € 315 million).

6.14 Provisions

6.14.1 Provisions other than post-employment benefits


	Restructuring	Litigations	Onerous contracts	Other provisions	Total
	€m	€m	€m	€m	€m

Balance at 1 January 2023	24	29	72	32	157
Provisions charged/(credited) to the income statement:
– Additions	45	4	23	3	75
– Reversals	–	(3)	(13)	(4)	(20)
Provisions used during the year	(10)	(2)	(43)	(3)	(58)
Other changes	(1)	(3)	(1)	(19)	(24)
Balance at 31 December 2023	58	25	38	9	130

The provisions mainly relate to the following:

Restructuring

In February 2023, RTL Deutschland announced a reorganisation of its publishing business to focus on its core brands Stern, Geo, Capital,

Stern Crime, Brigitte, Gala, Schöner Wohnen, Häuser, Couch, Eltern, Chefkoch, Geolino and Geolino Mini. Other brands were sold or

discontinued during the reporting period. During the reorganisation, costs will be reduced in all areas – especially in corporate functions,

corporate IT, office space, publishing and editorial teams. Around 500 jobs will be reduced in Hamburg, while an additional 200 jobs will be

transferred to new owners through the sale of titles. Negotiations with the employee representatives about a voluntary leave programme

(Freiwilligenprogramm) and the collective dismissal process – which specifies the financial terms of the restructuring plan and the number of

staff affected – were finalised during the first half-year 2023. As at 31 December 2023, the related provision amounted to €44 million.

Litigations

Provisions for litigations correspond to the Group’s best estimate of the expected future cash outflow related to disputes arising from the

Group’s activities. As at 31 December 2023, they comprise a number of litigations across RTL Group none of which were material on a stand-

alone basis.

RTL Group is party to legal proceedings in the normal course of its business, both as defendant and claimant. The main legal proceedings to

which RTL Group is a party are disclosed in the Directors’ Report under Significant litigations.

No further information is disclosed as it may harm the Group’s position.


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		102

Onerous contracts

‘Onerous contracts’ mainly comprise provisions made by:

– RTL Deutschland for €36 million (2022: €68 million) mainly in relation to the supply of programmes, of which sport events €10 million

(2022: €21 million)

– Groupe M6 for €2 million (2022: €1 million) in relation to the supply of programmes.


	2023	2022
	€m	€m

Current	87	109
Non-current	43	48
	130	157

6.14.2 Post-employment benefits


	2023	2022
	€m	€m

Defined benefit obligation	165	157
Other employee benefits	16	15
	181	172


	2023	2022
	€m	€m

Present value of defined benefit obligation of unfunded plans	161	155
Present value of defined benefit obligation of funded plans	112	106
Total present value of defined benefit obligation	273	261
Fair value of plan assets	(111)	(106)
Impact from asset ceiling
Net defined benefit liability recognised in the consolidated statement of financial position	162	155
– thereof provisions for pensions	165	157
– thereof other assets	3	2

6.15 Defined benefit obligations

RTL Group operates or participates in a number of defined benefit and defined contribution plans throughout Europe. FremantleMedia North

America in the United States also operates a medical care plan which is also a defined benefit obligation and is included in ‘Provisions’ in the

statement of financial position. These plans have been set up and are operated in accordance with national laws and regulations. A

description of the principal defined benefit plans of the Group and associated risks is given below:

France

Groupe M6 operates retirement indemnity plans which, by law, provide lump sums to employees on retirement. The lump sums are based on

service and salary at the date of the retirement in accordance with the applicable collective agreement. The Métropole Télévision (following

the merger with Ediradio) and ID retirement indemnity plan is partly funded by an insurance contract with AXA. Métropole Télévision

(following the merger with Ediradio) also participates in a defined benefit plan that provides pension benefits to members on retirement. This

plan is partly funded by an insurance contract with AXA. The assets of the insurance contract are not segregated but mutualised within the

global assets of the insurance company. A guaranteed interest rate is provided by AXA and the plan should not be affected by financial

market development. By nature, the lifetime risk of the beneficiaries is no longer supported by Métropole Télévision at retirement. The risk is

externalised to the insurer.

Germany

Employees of UFA companies (including UFA Fiction GmbH, UFA Shows & Factual GmbH, UFA GmbH, UFA Serial Drama GmbH), Radio

Center Berlin, AVE Gesellschaft für Hörfunkbeteiligungen GmbH, UFA Film & Fernsehen GmbH, RTL Group GmbH and RTL Group Central &

Eastern Europe participate in an unfunded common group retirement plan. The company UFA Serial Drama has a partly funded plan. Related

obligations and plan assets are subject to demographic, legal and economic risks. The main risk relates to longevity risk for pension

recipients. Each employer that participates in this plan has separately identifiable liabilities.

RTL Television, Super RTL, RTL Deutschland and Ad Alliance (former IP Deutschland GmbH) operate their own retirement arrangements. The

pension obligations of Super RTL Fernsehen GmbH provide for a one-time lump-sum benefit and a widow’s pension, which is subject to an


RTL Group Annual Report 2023


		103

annual increase of 1 per cent. Reinsurance policies have been taken out partially for the promised benefits. The reinsurance policies are

classified as plan assets.

The pension obligations of RTL Deutschland GmbH are based on individual commitments of mostly deferred compensation. A monthly

retirement pension is promised in an individually agreed amount, including entitlement for benefits in case of disability or death of the

beneficiary. Current pension benefits are increased by 2 per cent annually. One reinsurance policy without benefit-determining character

exists with AXA. Further there exists an individual commitment for a one-time lump-sum benefit, which is partially funded. The reinsurance

policies are classified as plan assets. Ad Alliance GmbH (former IP Deutschland GmbH) sponsors individual plans for five former employees,

providing defined pension benefits to each employee at retirement. RTL Television sponsors individual plans for two former employees,

providing defined pension benefits to each employee at retirement. In addition, a number of employees participate in a support fund providing

pension benefits to members and their dependants on retirement and death. The plan of RTL Television is partly funded by a life insurance

contract with AXA. The assets of the insurance contract are not segregated but mutualised within the global assets of the insurance

company. A guaranteed interest rate is provided by AXA and the plan should not be affected by financial market development. Both

companies are exposed to certain risks associated with defined benefits plans such as longevity, inflation and the increase of wages and

salaries.

The Gruner + Jahr companies participate in a pension plan, which has been closed to new members for many years. The pension entitlement

amounts to 50 per cent of the pensionable income, which is fixed at the age of 41. Pension payments are paid annually, increased by at least

2 per cent.

Luxembourg

CLT-UFA, RTL Group and Broadcasting Center Europe (BCE) sponsor a post-employment defined benefit plan in favour of their employees.

The occupational pension plan provides benefits to the affiliates (members and their dependants) in case of retirement, death in service or

disability. The pension benefits are financed through an internal book reserve, as one of the allowed funding vehicles described in the law of

8 June 1999 and amended by the Law of 1 August 2018 on occupational pension plans in Luxembourg. Therefore CLT-UFA, RTL Group and

BCE set up provision for the unfunded retirement benefit plan. Nevertheless, in such cases, the law requires the company to subscribe to

insolvency insurance with the German Pension Protection Fund (Pensionssicherungsverein). The CLT-UFA, RTL Group and BCE occupational

pension scheme is a defined benefit plan final pay with integration of the state pension. Consequently, the Company is exposed to certain

risks associated with defined benefits plans – such as longevity, inflation, the effect of compensation increases – and of the state pension

legislation.

Death and disability are insured with La Luxembourgeoise-Vie SA.

To further reduce the defined benefit risks, this plan has been closed for new employees at the end of 2022 and replaced by a defined

contribution plan for employees joining from 2023 onwards. Additionally two-thirds of the already entitled defined benefit plan members

opted for the new defined contribution plan. The change of the plan results in negative past service cost of €5 million recognised in the

financial year 2023.

United Kingdom

FremantleMedia Group Limited is the principal employer of the Fremantle Group Pension Plan (‘the Fremantle Plan’ or ‘the Plan’), which was

established on 29 December 2000 and was, prior to 1 September 2005, known as the RTL Group UK Pension Plan. The Fremantle Plan

provides benefits through two sections, one providing defined benefits and the other providing defined contribution benefits with a defined

benefit underpin. Plan assets are held for both sections of the Fremantle Plan – the assets in the defined benefit section are the qualifying

insurance (buy-in) policies; the assets in the defined contribution section comprise mainly equities, with the Plan holding corporate bonds in

relation to the defined benefit underpin. The Plan is funded through a trust administered by a trustee company, the assets of which are held

separately from the assets of the participating employers. FremantleMedia Group Limited is ultimately liable for any deficit in the Plan.

Funding requirements are under section 3 of the Pensions Act 2004 (UK), which requires:

– Three-yearly formal actuarial valuations, with annual monitoring

– Trustees to maintain a Statement of Funding Principles

– Trustees and employers to agree the approach to each actuarial valuation

– Funding deficits to be eliminated in accordance with a schedule of deficit funding contributions.

The Company has been managing and reducing the risks associated with the Fremantle Plan. The Company closed the Plan to all further

benefit accrual with effect from 31 March 2013. From 19 March 2014, the Company decided to secure benefits by insuring the Plan’s liabilities

through a buy-in policy.

Information about the nature of the present value of the defined benefit liabilities is detailed as follows:


	2023	2022
	€m	€m

Final salary plans	128	128
Career average plans	7	6
Flat salary plans/plans with fixed amounts	79	73
Other commitments given	59	54
Present value of defined benefit obligation	273	261
– thereof capital commitments	59	65


RTL Group Annual Report 2023


		104

‘Other commitments given’ broadly contains the defined contribution section of the Fremantle Plan. Under the Fremantle Plan Rules, in the

defined benefit sections, a member may opt to exchange up to around 25 per cent of their pension benefit for a cash lump sum.

The breakdown of the present value of the defined benefit liabilities by the plan members is as follows:


	2023	2022	2023	2022
	Head	Head	€m	€m

Active members	2,362	2,753	106	114
Deferred members	1,427	1,131	103	90
Pensioners	324	323	64	57
Total	4,113	4,207	273	261
– thereof vested			241	227

The amounts recognised in the consolidated statement of financial position are determined as follows:


	2023	2022
	€m	€m

Present value of defined benefit obligation of unfunded plans	161	155
Present value of defined benefit obligation of funded plans	112	106
Total present value of defined benefit obligation	273	261
Fair value of plan assets	(111)	(106)
Net defined benefit liability	162	155
– thereof provisions for pensions	165	157
– thereof other assets	3	2

The amounts recognised in profit or loss are determined as follows:


	2023	2022
	€m	€m

Current service cost	5	9
Past service cost and impact from settlement	(7)	1
Net interest expense	6	4
Net pension expense	4	14


RTL Group Annual Report 2023


		105

Changes in the present value of defined benefit obligations and plan assets in the reporting period were as follows:


	Defined benefit obligation (I)		Fair value of plan assets (II)		Net defined benefit balance (I)-(II)
	2023	2022	2023	2022	2023	2022
	€m	€m	€m	€m	€m	€m

Balance at 1 January	261	316	106	148	155	168
Current service cost	5	9	–	–	5	9
Interest expense	11	6	–	–	11	6
Interest income	–	–	5	2	(5)	(2)
Past service cost	(7)	1	–	–	(7)	1
Income and expenses for defined benefit plans recognised in the consolidated income statement	9	16	5	2	4	14
Income/expense on plan assets excluding amounts included in net interest income and net interest expense	–	–	–	(34)	–	34
Actuarial gains (-) and losses (+)
– changes in financial assumptions	14	(141)	–	–	14	(141)
– changes in demographic assumptions	(1)	5	–	–	(1)	5
– experience adjustments	1	(7)	–	–	1	(7)
Re-measurements for defined benefit plans recognised in the consolidated statement of comprehensive income	14	(143)	–	(34)	14	(109)
Contributions to plan assets by employer	–	–	–	1	–	(1)
Contributions to plan assets by employees	–	–	–	–	–	–
Pension payments	(10)	(13)	(3)	(8)	(7)	(5)
Changes in foreign exchange rates	2	(5)	2	(5)	–	–
Changes associated with assets held for sale	(2)	54	–	39	(2)	15
Change in consolidation scope	–	35	–	(38)	–	73
Other changes	(1)	1	1	1	(2)	–
Other reconciling items	(11)	72	–	(10)	(11)	82
Balance at 31 December	273	261	111	106	162	155

thereof
Germany	115	106	18	18	97	88
UK	89	84	91	86	(2)	(2)
Other European countries	69	70	2	2	67	68

Plan assets are comprised as follows:


	2023	2022
	€m	€m

Qualifying insurance policies	52	52
Equity instruments	44	40
Other funds	10	9
Debt instruments	5	4
Cash and cash equivalents	–	1
Fair value of plan assets	111	106


RTL Group Annual Report 2023


		106

Significant actuarial assumptions used were as follows:


	2023			2022
	% a year			% a year
	Germany	Other European countries	UK	Germany	Other European countries	UK

Discount rate	3.60	3.50	4.80	4.20	4.20	4.80
Rate of salary increase	2.25	3.19	n/a	2.25	3.25	n/a
Rate of pension increase	2.03	2.25	3.44	20.60	2.27	3.57

The breakdown of the weighted-average duration by geographical area is as follows:


	2023	2022
	years	years

Germany	15	15
Other European countries	11	11
UK	20	20

At 31 December 2023, the sensitivity of the defined benefit liabilities to changes in the weighted significant assumptions is as follows:


	Increase	Decrease
	€m	€m

Effect of 0.5 percentage point change in discount rate	(13)	14
Effect of 0.5 percentage point change in rate of salary increase	3	(3)
Effect of 0.5 percentage point change in rate of pension increase	7	(7)
Effect of change in average life expectancy by 1 year	4	(5)

The above sensitivity analysis is based on a change in an assumption while holding all other assumptions constant.

At 31 December 2023, expected maturity analysis of undiscounted pension future cash flows is as follows:


		Expected pension payments
		€m

2024		10
2025		12
2026		17
2027		20
2028		24
2029-2033		94

6.16 Equity

6.16.1 Share capital

At 31 December 2023, the share capital amounts to €192 million (2022: € 192 million) and is represented by 154,742,806 (31 December 2022:

154,742,806) fully paid-up ordinary shares, without nominal value.

At 31 December 2023, RTL Group’s share price, as listed on the Frankfurt Stock Exchange, was €34.96 (31 December 2022: €39.44 ).

6.16.2 Treasury shares

Since 31 December 2020, the Group no longer holds treasury shares.


RTL Group Annual Report 2023


		107

6.16.3 Currency translation reserve

The currency translation reserve comprises:

– all foreign exchange differences arising from the translation of the financial statements of foreign operations

– reserves on investments accounted for using the equity method for foreign exchange translation differences

– loans designated to form part of the Group’s net investment in specific undertakings, as repayment of those loans is not anticipated within

the foreseeable future.

6.16.4 Hedging reserve

The hedging reserve (equity attributable to non-controlling interests included) comprises the effective portion of the cumulative net change

in the fair value of cash flow hedging instruments related to hedged transactions that have not yet occurred. Between 31 December 2022 and

31 December 2023, the hedging reserve decreased by €-13 million before tax effects. Between 31 December 2021 and 31 December 2022,

the hedging reserve increased by €8 million before tax effects.

6.16.5 Revaluation reserve

The revaluation reserve includes:

– The cumulative change net of tax in the fair value of equity instruments at FVOCI (see note 6.6) for €34 million (2022: €32 million)

– The cumulative increase in the fair value of the intangible assets and property, plant and equipment following the gains of control of

Groupe M6 and M-RTL (2023: €55 million; 2022: €55 million).

6.16.6 Dividends

Based on the resolution of the Annual General Meeting of shareholders on 26 April 2023, the Annual General Meeting of shareholders

decided to distribute a final dividend of €4.00 per share. Accordingly, an amount of €619 million was paid out on 2 May 2023 (2022:

€774 million).

6.16.7 Share-based payment plans

Groupe M6 has established free shares plans open to directors and certain employees. The number of free shares granted to participants is

approved by the Supervisory Board of Métropole Télévision SA in accordance with the authorisation given by the Annual General Meeting of

shareholders.

Plans allocated in the financial year 2023:

– one plan involves 167 beneficiaries and covers 311,300 shares, subject to beneficiaries remaining employed by the Group at 31 March 2026

and the achievement of consolidated EBITA objectives in 2023

– another plan covers a group of 22 beneficiaries and relates to 191,900 shares subject to beneficiaries remaining employed by the Group at

31 March 2026. It is allotted annually on the basis of multi-year performance conditions.

The maximum number of free shares granted and remaining free shares are as follows, whereby all plans are settled by physical delivery of


	Grant date	Maximum number of free shares granted¹	Remaining free shares

Free shares plans
	20/04/2021	407,200	–
	20/04/2021	93,000	–
	10/10/2022	291,050	278,350
	10/10/2022	224,700	218,700
	15/05/2023	311,300	308,700
	15/05/2023	191,900	191,900
Total		1,519,150	997,650

1 The maximum number of free shares granted if the performance conditions are significantly exceeded. Such number could be reduced to nil if objectives are not met.

During the financial year, the balance of shares granted changed as follows:


		Number of shares

Balance at 31 December 2022		1,002,350
Change based on performance		(1,012)
Granted		503,200
Delivered		(485,588)
Forfeited		(21,300)
Balance at 31 December 2023		997,650


RTL Group Annual Report 2023


		108

Free shares plans outstanding at the end of the year have the following terms:


		Number of shares	Number of shares
	Expiry date	2023	2022
Free shares plans
	2023	–	486,600
	2024	218,700	224,700
	2025	278,350	291,050
	2026	500,600	–
Total		997,650	1,002,350

The market price of Métropole Télévision shares on the Paris Stock Exchange was €12.94 at 31 December 2023 (31 December 2022: €15.35).

The fair value of performance shares granted is based on the value of the share at date of grant less the current value of future dividends

estimated for the period of unavailability. For all performance share plans, the maturity corresponds to the vesting period (i.e. 2 years, 2 years

and 6 months, 2 years and 8 months or 3 years).

The features of plans, fair value of benefits granted and employee expenses are as follows:


					Employee expense
	Share price	Risk-free interest rate	Expected return	Fair value	2023	2022
Grant date	€	% a year	% a year	€	€m	€m

Free shares plans
30/07/2019 (2 plans)	15.35	(0.30)	6.97	13.23	–	0.8
20/04/2021 (2 plans)	18.38	(0.64)	n/a	14.34	1.3	4.1
10/10/2022 (2 plans)	10.34	2.07	6.15	8.38	1.6	0.4
15/05/2023 (2 plans)	13.32	2.79	7.89	11.40	1.1	–
Total					4.0	5.3

6.16.8 Non-controlling interests

RTL Group has ownership interest of 48.4 per cent (after considering treasury shares held by Groupe M6) in Métropole Télévision SA which,

together with its subsidiaries and investments accounted for using the equity method, represents Groupe M6, which is listed on the Paris

Stock Exchange. Deviating from the ownership interests, RTL Group holds 48.5 per cent of the voting rights. The total non-controlling

interests amount to €850 million at 31 December 2023 (2022: €798 million), of which €805 million (2022: €748 million) is for Groupe M6.

Non-controlling interests in other subsidiaries are individually immaterial.

The following tables summarise the information relating to Groupe M6, before any intra-group elimination.


RTL Group Annual Report 2023


		109

Summarised financial information (as published by Groupe M6):


	Groupe M6
	2023	2022
	€m	€m

Non-current assets	882	888
Current assets	1,168	1,099
Assets held for sale	–	–
Current liabilities	(547)	(535)
Non-current liabilities	(162)	(214)
Liabilities related to assets held for sale	–	–
Net assets	1,341	1,238

Revenue	1,316	1,357
Profit before tax	325	241
Income tax expense	(88)	(75)
Profit from continuing operations	237	166
Profit from discontinued operations	–	–
Group profit	237	166

Other comprehensive income	(1)	11
Total comprehensive income	236	177

Dividends paid to non-controlling interest	(6)	(5)

Net cash from/(used in) operating activities	307	296
Net cash from/(used in) investing activities	(65)	(80)
Net cash from/(used in) financing activities	(173)	(190)
Net increase/(decrease) in cash and cash equivalents	69	26

RTL Group’s subsidiary, Métropole Télévision SA, declared and paid cash dividends during the financial year 2023. The amount received

within the Group was eliminated on consolidation and the amount paid to non-controlling interests was €65 million (2022: €65 million).

Transactions on non-controlling interests without changes of control

In the financial year 2023, there were no significant transactions with non-controlling interests.

In June 2022, RTL Group exercised its right to acquire the remaining interest in Eureka, increasing its ownership from 51 per cent to

100 per cent. The consideration paid amounted to €55 million and related to the settlement of a put option liability on the remaining share

capital, which was recognised in connection with the acquisition of the majority interest in Eureka in 2021. The transaction was accounted for

as an equity transaction in accordance with IFRS 10. The transaction resulted in an increase of the equity attributable to RTL Group

shareholders in the amount of €17 million and a decrease of the equity attributable to non-controlling interests in the amount of €-17 million.


		Change in RTL Group shareholders’ equity
		€m

Carrying amount of interests acquired		17
Increase in RTL Group shareholders’ equity		17

– thereof increase in retained earnings		17
– thereof increase in other comprehensive income		–


RTL Group Annual Report 2023


		110

7. Financial risk management

7.1 Financial risk factors

The Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk and interest rate risk), credit risk and

liquidity risk. The Group is exposed in particular to risks from movements in foreign exchange rates as it engages in long-term purchase

contracts for programme rights (output deals) denominated in foreign currency.

Risk management is carried out by the Group Treasury department under the supervision of the Chief Financial Officer under policies

approved by the Board of Directors. Group Treasury identifies, evaluates and hedges risks in close cooperation with the Group’s operating

units. The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential

adverse effects on the Group’s financial performance. The Board of Directors has issued written principles for overall risk management and

written policies covering specific areas, such as market risk, credit risk, liquidity risk, use of derivatives and investment of excess liquidity.

The Group seeks to minimise the potential adverse effects of changing financial markets on its performance using standard market financial

derivatives, primarily unlisted (OTC) instruments such as foreign exchange forward contracts. Transactions are entered into with selected

banks in line with the Bank Relationship Policy. Derivatives are not used for speculative purposes. Risks are hedged to the extent that they

influence the Group’s cash flows (i.e. translational risk linked to the conversion of net investments in foreign operations is not hedged).

7.1.1 Market risk

Foreign exchange risk

Euro exchange rates for significant foreign currencies

The following significant exchange rates have been applied:


		Average rates		Closing rates
Foreign currency unit per €1		2023	2022	31 December 2023	31 December 2022

British pound	GBP	0.8699	0.8527	0.8691	0.8869
US dollar	USD	1.0814	1.0534	1.1050	1.0666
Australian dollar	AUD	1.6290	1.5165	1.6263	1.5693

Foreign exchange exposure

The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily in respect of

USD and GBP. Foreign exchange risk arises from recognised assets and liabilities, future commercial transactions and net investments in

foreign operations.

For the Group as a whole, cash flows, net income and net worth are optimised by reference to the Euro. However, foreign exchange risks faced

by individual Group companies are managed or hedged against the functional currency of the relevant entity (as these entities generally

generate their revenue in local currencies). The Group therefore manages a variety of currencies due to the numerous functional currencies

of the companies constituting the Group.

In addition, market practices in the television business imply a significant forward exposure to USD as programme rights are usually

denominated in USD and not paid up-front. For this reason, the main off-balance sheet exposure of the Group is towards the USD in respect

of future purchases and sales of programme rights, output deals (commitments for future cash flows) and highly probable forecast

transactions (US-$5 million as at 31 December 2023, US-$2 million as at 31 December 2022).

Management of foreign exchange exposure

RTL Group management has set up a policy to require Group companies to manage their foreign exchange risk against their functional

currency. Group companies are required to hedge their foreign currency exchange risk exposure with Group Treasury in accordance with the

Group’s Treasury policies. All foreign currency exchange exposures – including signed and forecast output deals and programme rights in

foreign currency – are centralised in an intranet-based database. To manage their foreign exchange risk arising from recognised assets and

liabilities and future commercial transactions, entities in the Group use forward contracts transacted with Group Treasury. Group Treasury is

then responsible for hedging, usually on a one-to-one basis, the exposure against the functional currency of the respective entity.

The Group’s Treasury policy is to hedge up to 100 per cent of the recognised monetary foreign currency exposures arising from cash,

accounts receivable, accounts payable, loans receivable and borrowings denominated in currencies other than the functional currency. The

Group Treasury policy is to hedge between 80 per cent and 100 per cent of short-term cash flow forecasts and between 10 per cent and 80

per cent of longer term (between two and five years) cash flow forecasts.

In order to monitor the compliance of the management of the foreign exchange exposure (mainly USD) with the Group’s policy, a monthly

report is produced and analysed by RTL Group management. This report shows each subsidiary’s exposure to currencies other than their

functional currency, detailing the nature (e.g. trade accounts, royalties, intercompany accounts) of on-balance sheet items, and the

underlying deals and maturities of off-balance sheet items, as well as the corresponding hedging ratios.


RTL Group Annual Report 2023


		111

Accounting

At interception of the hedging relationships, RTL Group documents the risk management objective and strategy for undertaking the hedge.

RTL Group also documents the economic relationship between the hedged item and the hedging instrument, including whether the changes in

cash flows of the hedged item and the hedging instrument are expected to offset each other.

RTL Group separates the spot component and the forward (or swap) point of the forward contracts. Only the spot component is considered

as the hedging instrument. Forward (or swap) points are accounted for directly in profit or loss accounts.

The foreign currency cash flow hedge accounting model defined under IFRS 9 is applied by those companies that account for the majority of

the Group’s foreign currency exposure, when:

– Hedged foreign currency exposures relate to programme rights transactions that have not yet been recognised on the consolidated

statement of financial position (such as forecast or firm purchases of programme rights for which the licence period has not yet begun)

– Amounts are sufficiently material to justify the need for hedge accounting.

When cash flow hedge accounting is applied, the effective portion of the changes in the fair value of the hedging instrument is recognised net

of deferred tax in the cash flow hedging reserve as presented in ‘Consolidated statement of changes in equity’. It is released to the income

statement in the periods in which the hedged item impacts the income statement. In case of hedging forecast purchases of programme rights

in foreign currency the releases from cash flow hedging reserve are added to the carrying amount of the hedged item when such an item is

recognised in the statement of financial position. The ineffective portion of the change in fair value of the hedging instrument is recognised

directly in profit or loss. For the year ended 31 December 2023, the swap points have been recognised in the income statement for €7 million

(2022: €1 million).

For recognised foreign currency monetary assets and liabilities there is a natural offset of gains and losses in the income statement between

the revaluation of the underlying derivatives and the exposure. Therefore, hedge accounting as defined under IFRS 9 is not applied.

Foreign exchange derivative contracts

The impact of forward foreign exchange contracts in the consolidated statement of financial position and in profit or loss is as follows:


	2023	2022
	€m	€m

Net fair value of foreign exchange derivatives	(13)	(5)

Operating foreign exchange gains/(losses)	(3)	–
Non-operating foreign exchange gains/(losses)	9	(19)
Gains/(losses) resulting from swap points	7	1


	2023	2022
	€m	€m

Less than 3 months	(15)	(10)
Less than 1 year	–	5
Less than 5 years	2	–
Net fair value of foreign exchange derivatives	(13)	(5)

The items ‘Operating foreign exchange gains/(losses)’ and ‘Non-operating foreign exchange gains/(losses)’ relate to derivatives used to

offset the currency exposure relating to recognised monetary assets and liabilities for which hedge accounting as defined under IFRS 9 is not

applied.


RTL Group Annual Report 2023


		112

The split by maturities of notional amounts of forward exchange contracts at 31 December 2023 is, for the main foreign currencies, as

follows:


	2024	2025	2026	2027	≥ 2028	Total
	£ m	£ m	£ m	£ m	£ m	£ m

Buy	307	32	10	4	3	356
Sell	(488)	(14)	(3)	(2)	(1)	(508)
Total	(181)	18	7	2	2	(152)


	2024	2025	2026	2027	≥ 2028	Total
	$ m	$ m	$ m	$ m	$ m	$ m

Buy	993	102	24	1	2	1,122
Sell	(329)	(27)	(11)	(4)	(3)	(374)
Total	664	75	13	(3)	(1)	748

The split by maturities of notional amounts of forward exchange contracts at 31 December 2022 is, for the main foreign currencies, as

follows:


	2023	2024	2025	2026	≥ 2027	Total
	£ m	£ m	£ m	£ m	£ m	£ m

Buy	388	125	12	4	4	533
Sell	(533)	(90)	(6)	(1)	(2)	(632)
Total	(145)	35	6	3	2	(99)


	2023	2024	2025	2026	≥ 2027	Total
	$ m	$ m	$ m	$ m	$ m	$ m

Buy	767	151	14	7	2	941
Sell	(353)	(142)	(12)	(5)	(6)	(518)
Total	414	9	2	2	(4)	423

Sensitivity analysis to foreign exchange rates

Management estimates that:

– If the USD had been 10 per cent stronger compared to the € (respectively weaker), with all other variables held constant, this would have

had no material impact on the Group’s profit or loss (2022: no material impact), and an additional pre-tax €23 million gain (respectively

loss) (2022: €22 million gain (respectively loss)) recognised in total comprehensive income in equity

– If the GBP had been 10 per cent stronger compared to the € (respectively weaker), with all other variables held constant, this would have

had no material impact on the Group’s profit or loss (2022: no material impact), and an additional pre-tax €1 million loss (respectively gain)

recognised in total comprehensive income in equity (2022: no material impact)

– If other currencies had been 10 per cent stronger compared to the € (respectively weaker), with all other variables held constant, this would

have had no material impact on the Group’s profit or loss (2022: no material impact) and no material impact on the pre-tax expense

(respectively income) recognised in total comprehensive income in equity (2022: no material impact).

This sensitivity analysis does not include the impact of translation into € of foreign operations.

Interest rate risk

The objective of the interest rate risk management policy is to minimise the interest rate funding cost over the long term and to maximise the

excess cash return.

The Group interest rate risk arises primarily from loans payable, financing agreements with Bertelsmann SE & Co. KGaA and its subsidiaries

(see note 10.1) and from cash and cash equivalents.

During the third quarter of 2017, Groupe M6 secured a seven-year Euro private placement bond issue (seven-year Euro private placement

bond) of €50 million bearing a fixed annual interest rate of 1.50 per cent (all-in).


RTL Group Annual Report 2023


		113

During the third quarter of 2019, Groupe M6 entered into a seven-year-term Schuldschein loan of €75 million including a credit line of

€65 million with a fixed rate of 1 per cent and a credit facility for €10 million with a floating rate of EURIBOR six months (floored at zero per

cent) plus a margin of 1 per cent per year. The fair value of the seven-year-term Schuldschein of €65 million − calculated as the present

value of the payments associated with the debt and based on the applicable yield curve and Groupe M6 credit spread − amounts to

€62 million (2022: €65 million).

Groupe M6 total committed credit facilities amount to €180 million, equally split between three different counterparties. Two of the credit

facilities expire in 2024. The third one expires at the end of 2028.

In order to maximise the excess cash return on cash balances and to minimise the gross indebtedness of the Group, cross-border cash

pooling has been set up for most Group entities. The interest rate strategy defined by RTL Group depends on the net cash position of each

company.

Group Treasury uses various indicators to monitor interest rate risk, such as a targeted net fixed/floating rate debt ratio, duration, basis point

value (increase in interest rate costs resulting from a basis point increase in interest rate) and interest coverage ratio.

If the interest rates achieved had plus or minus 100 basis points, and assuming the current amount of floating net cash available remained

constant, the net interest income/(expense) at 31 December 2023 would have been changed as follows:


	31 December 2023		31 December 2022
	Shift +1%	Shift -1%	Shift +1%	Shift -1%
	€m	€m	€m	€m

Cash flow risks (income statement)	4.4	(4.4)	3.0	(3.0)

7.1.2 Credit risk

RTL Group’s exposure to credit risk primarily arises through sales made to customers (trade receivables), investments in money market funds

classified in cash and cash equivalents, and deposits made with banks and the shareholder.

Credit risk is managed on a Group basis, except for credit risk relating to accounts receivable balances, which are managed by individual

subsidiaries.

The Group’s television and radio operations incur exposure to credit risk when making transactions with advertising agencies or direct

customers. In 2023, combined television and radio advertising revenue contributed 18 per cent of the Group’s revenue (2022: 43 per cent).

Due to its business model, RTL Group’s exposure to credit risk is directly linked to the final client. However, the risks are considered to be low

due to the size of the individual companies or agency groups.

RTL Group sells, licenses and monetises content to state-owned and commercial television channels and internet platforms. In 2023, these

activities contributed 35 per cent of the Group’s revenue (2022: 34 per cent). Given the limited number of television broadcasters in different

countries, there is a high degree of concentration of credit risk. However, given the long-standing relationships between content providers and

broadcasters, and the fact that the customers are large businesses with solid financial positions, the level of credit risk is significantly

mitigated.

RTL Group also has policies in place to ensure that sales of products and services are made to customers with an appropriate credit history.

According to the Group’s banking policy, derivative instruments and cash transactions (including bank deposits and investments in money

market funds) are operated only with high credit quality financial institutions in order to mitigate counterparty risk (only independently rated

parties with a minimum rating of ‘BBB+’ are accepted for bank deposits for the smallest tranches). The Group’s bank relationship policy sets

forth stringent criteria for the selection of banking partners and money market funds (such as applicable supervisory authorities, investment

policy, maximum volatility, track record, rating, cash and cash equivalents as defined under IAS 7). To mitigate settlement risk, the Group has

policies that limit the amount of credit exposure to any one financial institution on any single day. Statistics (such as the percentage of the

business allocated to each bank over the year, or a summary of the highest intraday exposures by bank and maturity date) are computed and

used daily to ensure credit risk is mitigated in practice at any time.

The carrying amount of financial assets represents their maximum credit exposure.

For trade receivables and contract assets, RTL Group uses a simplified approach to measure expected credit losses. According to this, the

loss allowance is measured using lifetime expected credit losses. For this purpose, impairment matrices based on historic bad debt losses,

maturity bands and expected credit losses have been prepared. The impairment matrices were created for business unit-specific groups of

receivables, each with similar default patterns. In addition, separate risk assessments are performed. Contract assets have substantially the


RTL Group Annual Report 2023


		114

same risk characteristics as trade receivables for the same types of contracts, so that the expected loss rates for trade receivables are a

reasonable approximation of the loss rates for contract assets.


At 31 December 2023	Current	More than 30 days past due	More than 90 days past due	Total
At 31 December 2023	€m	€m	€m	€m

Average expected loss rate (in %)	0.26	2.22	4.55
Gross carrying amount	1,170	45	44	1,259
Loss allowance	3	1	2	6


At 31 December 2022	Current	More than 30 days past due	More than 90 days past due	Total
At 31 December 2022	€m	€m	€m	€m

Average expected loss rate (in %)	0.41	1.52	7.94
Gross carrying amount	1,218	66	63	1,347
Loss allowance	5	1	5	11

At 31 December 2023, the gross carrying amount of credit impaired trade receivables and contract assets amounts to €30 million with

€28 million loss allowance (2022: €39 million and €34 million, respectively).

The other accounts receivables are considered to be of low default risk.

The Group has a significant concentration of credit risk due to its relationship with Bertelsmann. Nevertheless, credit risk arising from

transactions with the principal shareholder or its subsidiaries is significantly mitigated (see note 10.1). RTL Group considers that there is a low

concentration of credit risk for other counterparties.

7.1.3 Price risk

The Group is subject to price risk mainly linked to equity securities, earn-out mechanisms, put options on non-controlling interests and

derivatives, and investments accounted for using the equity method. The primary goal of the Group’s investment in equity securities

categorised as FVOCI is to hold such investments for the long term for strategic purposes. Some investments designated at FVTPL are

actively monitored on a fair value basis.

7.1.4 Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash, the availability of funding through an adequate amount of committed

credit facilities and the ability to close out market positions. Due to the dynamic nature of the underlying business, management aims to

maintain flexibility in funding by keeping committed credit lines available despite the total cash situation. Cash flow forecasting is performed

in the operating entities of the Group. Group Treasury monitors rolling forecasts on the Group’s liquidity requirements to ensure it has

sufficient headroom to meet operational needs. Management monitors, on a monthly basis, the level of the ‘liquidity headroom’ (total

committed facilities minus current utilisation through bank loans and guarantees).


	Under 1 year	1 to 5 years	Over 5 years	2023
	€m	€m	€m	€m

Credit facilities – banks
Committed facilities	170	135	–	305
Headroom	120	60	–	180


	Under 1 year	1 to 5 years	Over 5 years	2022
	€m	€m	€m	€m

Credit facilities – banks
Committed facilities	–	247	–	247
Headroom	–	122	–	122

Surplus cash held by the operating entities over and above balances required for working capital management is transferred to Group

Treasury. Group Treasury invests surplus cash in interest-bearing current accounts, time deposits, money market funds or deposits with


RTL Group Annual Report 2023


		115

Bertelsmann SE & Co. KGaA (see note 10.1) choosing instruments with appropriate maturities or sufficient liquidity to provide sufficient

headroom as determined by the above-mentioned forecasts.

The table below analyses the Group’s financial liabilities into relevant maturity groupings based on the remaining period at the closing date to

the contractual maturity date. The amounts disclosed in the table below are the contractual undiscounted cash flows.


	Under 1 year	1 to 5 years	Over 5 years	Total
	€m	€m	€m	€m

Non-derivative financial liabilities
Loans and bank overdrafts	253	685	4	942
Lease liabilities	84	179	68	331
Accounts payable and other non-derivative financial liabilities	1,310	108	86	1,504
At 31 December 2023	1,647	972	158	2,777

Derivative financial liabilities
Forward exchange contracts used for hedging:
– Outflow	(1,200)	(100)	–	(1,300)
– Inflow	1,171	100	–	1,271
At 31 December 2023	(29)	–	–	(29)


	Under 1 year	1 to 5 years	Over 5 years	Total
	€m	€m	€m	€m

Non-derivative financial liabilities
Loans and bank overdrafts	547	134	4	685
Lease liabilities	91	220	97	408
Accounts payable and other non-derivative financial liabilities	1,808	139	91	2,038
At 31 December 2022	2,446	493	192	3,131

Derivative financial liabilities
Forward exchange contracts used for hedging:
– Outflow	(1,027)	(181)	(2)	(1,210)
– Inflow	984	167	2	1,153
At 31 December 2022	(43)	(14)	–	(57)

7.2 Capital management

The Group monitors capital on the basis of its net debt to EBITDA ratio (non-IFRS measure).

The Group’s ability and intention to pay dividends in the future will depend on its financial condition, results of operations, capital

requirements, investment alternatives and other factors that management may deem relevant. Management expects that the principal

source of funds for the payment of dividends will be the cash flow and dividends received from its current and future subsidiaries.

The Group intends to pay ordinary dividends in the future targeting a dividend payout ratio of at least 80 per cent of the adjusted net profit

attributable to RTL Group shareholders.

The adjusted net profit (non-IFRS measure) is the reported net result available to RTL Group shareholders, adjusted for any material non-

cash impacts such as goodwill impairments.


RTL Group Annual Report 2023


		116

7.3 Accounting classifications and fair value hierarchy

7.3.1 Financial instruments by category

The fair value of each class of financial assets and liabilities is equivalent to its carrying amount.


	Financial assets at FVTPL	Equity instruments at FVOCI	Derivatives at FVTPL	Financial assets at amortised cost	Total
	€m	€m	€m	€m	€m

Assets
Loans and other financial assets	16	32	4	60	112
Accounts receivable and other financial assets	101	–	14	1,455	1,570
Cash and cash equivalents	149	–	–	426	575
At 31 December 2023	266	32	18	1,941	2,257


	Liabilities at FVTPL	Derivatives at FVTPL	Financial liabilities at amortised cost	Total
	€m	€m	€m	€m

Liabilities
Loans and bank overdrafts	–	–	942	942
Lease liabilities	–	–	301	301
Accounts payable and other financial liabilities	1	31	1,486	1,518
At 31 December 2023	1	31	2,729	2,761


	Financial assets at FVTPL	Equity instruments at FVOCI	Derivatives at FVTPL	Financial assets at amortised cost	Total
	€m	€m	€m	€m	€m

Assets
Loans and other financial assets	9	29	14	59	111
Accounts receivable and other financial assets	127	–	38	2,015	2,180
Cash and cash equivalents	170	–	–	419	589
At 31 December 2022	306	29	52	2,493	2,880


	Liabilities at FVTPL	Derivatives at FVTPL	Financial liabilities at amortised cost	Total
	€m	€m	€m	€m

Liabilities
Loans and bank overdrafts	–	–	685	685
Lease liabilities	–	–	385	385
Accounts payable and other financial liabilities	31	57	1,984	2,072
At 31 December 2022	31	57	3,054	3,142

7.3.2 Fair value hierarchy

The different levels have been defined as follows:

– Level 1: quoted prices (unadjusted) in active markets for identical assets (or liabilities)

– Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. prices) or

indirectly (i.e. derived from prices)

– Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs). Listed financial instruments

with contractual trading restrictions (lock-ups) are also measured on the basis of unobservable factors.


RTL Group Annual Report 2023


		117

The following table presents the Group’s financial assets and liabilities measured at fair value.


	Total	Level 1	Level 2	Level 3
	€m	€m	€m	€m

Assets
Equity instruments at FVOCI	32	–	–	32
Equity instruments at FVTPL	112	95	–	17
Debt instruments at FVTPL	5	–	3	2
Primary and derivative financial assets held for trading	13	–	13	–
Derivatives with hedge relation	5	–	5	–
Other cash equivalents	149	–	149	–
At 31 December 2023	316	95	170	51

Liabilities
Primary and derivative financial liabilities held for trading	27	–	27	–
Derivatives with hedge relation	4	–	4	–
Contingent consideration	1	–	–	1
At 31 December 2023	32	–	31	1


	Total	Level 1	Level 2	Level 3
	€m	€m	€m	€m

Assets
Equity instruments at FVOCI	29	–	–	29
Equity instruments at FVTPL	133	123	–	10
Debt instruments at FVTPL	3	–	–	3
Primary and derivative financial assets held for trading	39	–	39	–
Derivatives with hedge relation	13	–	13	–
Other cash equivalents	170	–	170	–
At 31 December 2022	387	123	222	42

Liabilities
Primary and derivative financial liabilities held for trading	48	–	48	–
Derivatives with hedge relation	9	–	9	–
Contingent consideration	31	–	–	31
At 31 December 2022	88	–	57	31

The amount disclosed in ’Equity instruments at FVTPL’ mainly (€95 million; 2022: €123 million) relates to the Magnite shares. The effect from

re-measurement of these shares amounted to €-12 million (2022: €-67 million) and is disclosed in ‘Other operating expenses’ under ‘Fair

value measurement of investments’.

The fair value of financial instruments traded in active markets is based on quoted market prices at the balance sheet date. A market is

regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or

regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm’s length basis. These

instruments are included in Level 1. The quoted market price used for financial assets by the Group is the current bid price.

The fair value of financial instruments that are not traded in an active market is determined using valuation techniques. These valuation

techniques maximise the use of observable market data where it is available and rely as little as possible on entity-specific estimates. If all

significant inputs required are observable, the instrument is included in Level 2.

If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3. Listed financial

instruments with contractual trading restrictions (lock-ups) are also measured on the basis of unobservable factors and included in Level 3.

The Group’s Treasury and Controlling teams perform the recurring and non-recurring valuations of items to be valued at fair value for

financial purposes, including Level 3 fair values. These teams report directly to the Chief Financial Officer, who reports to the Audit

Committee at least once every quarter, in line with the Group’s quarterly reporting dates. The main Level-3-related inputs used by RTL Group

relate to the determination of the expected discounted cash flows and the discount rates used in the different valuations.


RTL Group Annual Report 2023


		118

Specific valuation techniques used to value financial instruments include:

– For measuring the fair value of unlisted derivatives, RTL Group uses various financial methods reflecting the prevailing market conditions

and risks at the respective balance sheet dates. Irrespective of the type of financial instrument, future cash flows are discounted at the end

of the reporting period based on the respective market interest rates and yield curves at the end of the reporting period. The fair value of

forward exchange transactions is calculated using middle spot prices at the end of the reporting period and taking into account forward

markdowns and markups for the remaining term of the transactions. (Level 2)

– For instruments classified under Level 3, other techniques, such as discounted cash flow analysis or option pricing models are used. These

are based for the main instruments on significant unobservable inputs (for example forecast revenue growth rates and market multiples) to

determine the fair value for the remaining financial instruments. Volatility is primarily determined by reference to comparable, publicly

traded peers.

Transfers between levels of the fair value hierarchy are recognised at the date of the event or change in circumstances that caused the

transfer.

The following table presents the change in Level 3 instruments:


	Assets			Liabilities
	Financial assets at FVTPL	Equity instruments at FVOCI	Total assets	Liabilities at FVTPL
	€m	€m	€m	€m

Balance at 1 January 2023	13	29	42	31
Acquisitions and additions	9	–	9	–
Gains and losses recognised in other comprehensive income	–	3	3	1
Gains and losses recognised in profit or loss	(11)	–	(11)	9
Sales/settlements	(6)	–	(6)	(40)
Transfers into Level 3 (including first-time classification as Level 3)	3	–	3	–
Transfers out of Level 3	(1)	–	(1)	–
Other changes	12	–	12	–
Balance at 31 December 2023	19	32	51	1

The amount disclosed in ’Acquisitions and additions’ in the assets column relates to different smaller investments. The amount disclosed in

‘Sales/settlements’ in the liabilities column relates to payments in connection with contingent consideration arrangements by Fremantle.


	Assets			Liabilities
	Financial assets at FVTPL	Equity instruments at FVOCI	Total assets	Liabilities at FVTPL
	€m	€m	€m	€m

Balance at 1 January 2022	101	32	133	4
Acquisitions and additions	4	4	8	31
Gains and losses recognised in other comprehensive income	–	(6)	(6)	–
Gains and losses recognised in profit or loss	–	–	–	(1)
Sales/settlements	(92)	(1)	(93)	(3)
Balance at 31 December 2022	13	29	42	31

The amount disclosed in ’Acquisitions and additions’ in the liabilities column related to liabilities resulting from contingent consideration

arrangements on acquisitions conducted by Fremantle. The respective expected cash inflows were estimated based on the relevant terms of

the sale and purchase agreements, RTL Group’s knowledge of the business of acquired entities, and how the current economic environment is

likely to impact it. In the financial year 2022, the amount disclosed in ‘Sales/settlements’ related to the sale of the investment in VideoAmp –

a US software and data company for media measurement – in January 2022. There were no transfers in or out of Level 3 during 2022.

7.4 Master netting agreements

The Group enters into derivative transactions under International Swaps and Derivatives Association (ISDA) master netting agreements. In

certain circumstances – e.g. when a credit event such as a default occurs – all outstanding transactions under the agreement are

terminated, the termination value is assessed and only a single net amount is payable in settlement of all transactions.

The ISDA agreements do not meet the criteria for offsetting in the statement of financial position. This is because the Group does not

currently have any legally enforceable right to offset recognised amounts, because the right to offset is enforceable only on the occurrence of

future events such as a bank loan default or other credit event.


RTL Group Annual Report 2023


		119

The following table sets out the carrying amounts of recognised financial instruments that are subject to the above agreements. The column

‘Net amount’ shows the impact on the consolidated statement of financial position if all set-off rights were exercised.


	31 December 2023			31 December 2022
	Gross amounts in the statement of financial position	Related financial instruments that are not offset	Net amount	Gross amounts in the statement of financial position	Related financial instruments that are not offset	Net amount
	€m	€m	€m	€m	€m	€m

Financial assets
Derivative financial instruments
– Forward exchange contracts used to offset currency exposure	18	(17)	1	52	(43)	9
	18	(17)	1	52	(43)	9

Financial liabilities
Derivative financial instruments
– Forward exchange contracts used to offset currency exposure	(31)	17	(14)	(57)	43	(14)
	(31)	17	(14)	(57)	43	(14)

8. Commitments and contingencies


	2023	2022
	€m	€m

Guarantees and endorsements given	–	27
Contracts for purchasing rights, (co-)productions and programmes	1,620	1,704
Satellite transponders	4	20
Leases signed but not yet commenced	23	–
Purchase obligations in respect of transmission and distribution	126	153
Other long-term contracts and commitments	211	236

The Group has investments in unlimited liability entities. In the event that these entities make losses, the Group may have to participate to the

entire amount of losses, even if these entities are not wholly owned.

Some Dutch companies have elected to make use of the exemption to publish annual accounts in accordance with Section 403(1b) of the

Dutch Civil Code. In order to fulfil the conditions set out in the regulations, the Company has given a statutory guarantee of all outstanding

liabilities to which the subsidiaries are subject at the end of the financial year 2023. A full list of the companies concerned is provided in

note 12.

In the course of their activities, several Group companies benefit from licence frequency agreements, which commit the Group in various

ways depending upon the legal regulation in force in the countries concerned.

8.1 Purchase obligations in respect of transmission and distribution

These obligations result from agreements with providers of services related to the terrestrial and cable transmission and distribution of the

signals of the Group’s TV channels and radio stations.

8.2 Other long-term contracts and commitments

Long-term contracts include contracts for services, agreements to purchase assets or goods, and commitments to acquire licences other

than audio-visual rights and television programming that are enforceable and legally binding and that specify all significant terms.


RTL Group Annual Report 2023


		120

9. Cash flow statement

The consolidated cash flow statement has been prepared in accordance with IAS 7 and is used to evaluate the Group’s ability to generate

cash and cash equivalents. Cash flows are divided into those relating to operating activities, investing activities and financing activities. Cash

flows from operating activities are presented using the indirect method, whereby ‘Group profit before tax’ is adjusted for the effects of a non-

cash nature, any deferrals or accruals of past or future operating receipts or payments, and items of income or expense associated with

investing and financing cash flows. In addition, cash flows arising from income taxes are classified as cash flows from operating activities as

well as other cash flows that are neither investing nor financing.

The change in provisions for pensions and similar obligations represents the balance of personnel costs for pensions and similar obligations

and company payments for these obligations (see note 6.15). Contributions to pension plans totalling € nil million (2022: €-1 million) were

also included in this item. ‘Financial results including net interest expense and share of results of investments accounted for using the equity

method’ of the cash flow from operating activities includes the adjustments of results from investments accounted for using the equity

method, taking into account dividends received from these investments, adjustments of items of expense associated with financing activities,

and adjustments in connection with non-cash income and expenses.

The consolidated cash flow statement includes the effects of changes in foreign currencies and changes in the scope of consolidation. Items

in the consolidated cash flow statement thus cannot be reconciled with changes in items reported in the statement of financial position.

Investing activities include payments for investments in non-current assets and purchase price payments for acquisitions as well as

proceeds from the disposal of non-current assets and consolidated investments . Further explanations concerning acquisitions made during

the financial year are presented in note 4.2. Disposals made during the financial year are presented separately in note 4.3. In the financial

year 2023, financial debt of €nil million was assumed during the reporting period. In 2022, financial debt of €-46 million was assumed during

the reporting period, of which €3 million was repaid at acquisitions date. Its repayment was presented in ‘Acquisitions of: Subsidiaries, net of

cash acquired’. Also in 2022, ‘Proceeds from the sale of investments accounted for using the equity method, other investments and financial

assets’ mainly related to disposal of the entire investment in VideoAmp for US-$104 million (€92 million) in cash in January 2022. The

transaction was carried out as a share buyback by VideoAmp.

‘Cash flow from financing activities’ includes changes in equity, financial debt, lease liabilities and dividend distributions affecting cash, as

well as interest paid (including interest paid due to leases). In the financial year 2023, ‘Proceeds from loans’ mainly include a shareholder loan

from Bertelsmann Business Support Sàrl of €250 million entered into by RTL Group SA. Total cash outflows from leases amounted to

€-94 million (2022: €-86 million).

The following tables show the cash changes and non-cash changes of liabilities arising from financing activities:


			Non-cash changes
	1 January 2023	Cash changes	Acquisitions through business combinations	Disposals through business combinations	Exchange rate effects	Other changes	31 December 2023
	€m	€m	€m	€m	€m	€m	€m

Bank overdrafts	1	1	–	–	–	–	2
Bank loans payable	158	6	–	(1)	–	–	163
Loans due to investments accounted for using the equity method	1	1	–	–	–	–	2
Term loan facility due to shareholders and their subsidiaries	511	229	–	–	–	30	770
Other loans payable	13	(5)	–	–	–	(3)	5
Lease liabilities	385	(94)	–	–	(1)	11	301
Liabilities arising from financing activities	1,069	138	–	(1)	(1)	38	1,243


RTL Group Annual Report 2023


		121


			Non-cash changes
	1 January 2022	Cash changes	Acquisitions through business combinations	Disposals through business combinations	Exchange rate effects	Other changes	31 December 2022
	€m	€m	€m	€m	€m	€m	€m

Bank overdrafts	–	1	–	–	–	–	1
Bank loans payable	154	(34)	36	–	–	2	158
Loans due to investments accounted for using the equity method	1	–	–	–	–	–	1
Term loan facility due to shareholders and their subsidiaries	511	(14)	–	–	–	14	511
Other loans payable	17	(12)	7	–	–	1	13
Lease liabilities	332	(86)	13	(1)	–	127	385
Liabilities arising from financing activities	1,015	(145)	56	(1)	–	144	1,069

As at 31 December 2023, the other non-cash changes in lease liabilities mainly related to lease contracts newly concluded and extended

lease contracts in the financial year 2023 partly compensated by early termination of lease contracts and presentation of RTL Nederland as

assets held for sale. As at 31 December 2022, the other non-cash changes in lease liabilities mainly related to lease contracts newly

concluded and extended lease contracts in the financial year 2022.

10. Related parties

Identity of related parties

At 31 December 2023, the principal shareholder of RTL Group is Bertelsmann Capital Holding GmbH (BCH) (76.28 per cent). The remainder

of the Group’s shares are publicly listed on the Frankfurt and Luxembourg Stock Exchanges. The Group also has a related party relationship

with its associates, joint ventures and with its directors and executive officers.

10.1 Transactions with shareholders and their subsidiaries

Sales and purchases of goods and services

During the year the Group made sales of goods and services to and purchases of goods and services from Bertelsmann Group amounting to

€28 million (2022: €34 million) and €63 million (2022: €62 million) respectively. At the year-end, the Group had trade accounts receivable

and payable due from/to Bertelsmann Group amounting to €3 million (2022: €14 million) and €14 million (2022: €18 million) respectively. At

31 December 2023, RTL Group had prepaid expenses to Bertelsmann Group amounting to €7 million (31 December 2022: €3 million).

Dividend income

In 2023 RTL Group received dividends of €5 million (2022: €2 million) from Bertelsmann Business Support Sàrl related to a 10 per cent

interest in the entity, thereof a minimum dividend amounted to €1 million (2022: €1 million). A 25-year shareholders’ agreement has been

concluded between Bertelsmann SE & Co. KGaA and RTL Group SA. The shareholders’ agreement stipulates that 50 per cent of the

aggregate amount of corporate and trade tax that, in the absence of existing tax losses carried forward of Bertelsmann Business Support

Sàrl, if any, would have otherwise been incurred by the Company, will be paid to RTL Group SA as a preferred dividend with a minimum

amount of €1 million per year. The minimum dividend of €1 million became payable as from 2016 onwards and has been recognised at

contract inception for the entire contract duration. Only excessive amounts are recognised in profit or loss. The dividend accounts receivable

amounts to €13 million as at 31 December 2023 (31 December 2022: €14 million).

Lease agreement

As at 1 January 2022, RTL Group has entered into a sub-lease agreement with RM Hamburg Holding GmbH, a subsidiary of Bertelsmann SE

& Co. KGaA, for premises in Hamburg, Germany. The lease contract expires on 31 January 2025. The lease payments in the financial year

2023 amount to €13 million (2022: €12 million). The payables from this lease agreement as at 31 December 2023 amount to €15 million

(31 December 2022: €26 million). The lease payments of RTL Group correspond to the payments of Bertelsmann from the head lease.

Deposits Bertelsmann SE & Co. KGaA

In 2006, RTL Group SA entered into a Deposit Agreement with Bertelsmann SE & Co. KGaA, the main terms of which are the following as of

31 December 2023:

– Interest rates are based on ESTR (floored to zero) plus 10 basis points

– Bertelsmann SE & Co. KGaA grants to RTL Group as security for all payments due by Bertelsmann SE & Co. KGaA a pledge on:

– All shares of its wholly owned French subsidiary, Média Communication SAS

– All shares of its wholly owned Spanish subsidiary, Bertelsmann Espana SLU (Arvato Group excluded)

– All shares of its wholly owned German subsidiary, RM Hamburg Holding GmbH

– All shares of its wholly owned English subsidiary, Bertelsmann UK Ltd (Arvato Group excluded).

The shares of RM Hamburg Holding GmbH and shares of Bertelsmann UK Ltd have also been granted as pledge by Bertelsmann SE & Co.

KGaA to CLT-UFA SA, a subsidiary of RTL Group, in connection with the accounts receivable related to PLP and Compensation Agreements

as defined below.


RTL Group Annual Report 2023


		122

In December 2011, RTL Group GmbH, a Group company, and Bertelsmann SE & Co. KGaA entered into an agreement related to the deposit of

surplus cash by RTL Group GmbH with the shareholder. To secure the deposit, Bertelsmann pledged to RTL Group GmbH its shares of RM

Hamburg Holding GmbH.

In March 2021, an amendment to the pledge agreement was signed between RTL Group SA, RTL Group GmbH, CLT-UFA SA, Bertelsmann SE

& Co. KGaA, Reinhard Mohn GmbH and Bertelsmann Business Support Sàrl that precises the valuation methodology of the pledged shares

and grants to RTL Group an additional pledge on all current repayment claims of Bertelsmann Business Support Sàrl against RTL Group

GmbH under the Term Loan Facility of €500 million.

In March 2023, a further amendment to the pledge agreement was signed between RTL Group SA, RTL Group GmbH, CLT-UFA SA,

Bertelsmann SE & Co. KGaA, Reinhard Mohn GmbH and Bertelsmann Business Support Sàrl granting RTL Group the pledge on all current

repayment claims of Bertelsmann Business Support Sàrl against RTL Group GmbH under the new term loan facilities of €500 million.

At 31 December 2023, the deposit of RTL Group GmbH with Bertelsmann SE & Co. KGaA amounted to €76 million (2022: €197 million). The

interest income for the period is €1 million (2022: €1 million).

In April 2021, Bertelsmann, Inc. signed a promissory note for a total amount of US-$705 million. In September 2021, an amended version was

signed including a remuneration of five basis points on the outstanding amount.

At 31 December 2023, the outstanding amount was EUR-equivalent €nil million (2022: €79 million). The interest income/expense for the

year was €nil million (2022: €nil million).

Loans from Bertelsmann SE & Co. KGaA and Bertelsmann Business Support S.à.r.l.

On 7 March 2013, RTL Group GmbH and Bertelsmann SE & Co. KGaA entered into a shareholder loan agreement pursuant to which

Bertelsmann makes available a term loan facility in the amount of €500 million and a revolving and swing line facility in the amount of up to

€1 billion. The revolving loan terminated in February 2018. RTL Group has re-negotiated an extension for another five-year period. The main

terms of these facilities were:

– Term loan facility of €500 million until 7 March 2023 bearing a fixed interest rate of 2.713 per cent per annum; RTL Group SA had the right

to early repay the loan subject to break costs. On 23 June 2016, the term loan facility of €500 million was transferred from Bertelsmann SE

& Co. KGaA to Bertelsmann Business Support Sàrl controlled by Bertelsmann Luxembourg Sàrl. At 31 December 2022, the term loan

balance amounted to €500 million. The fair value of the 10-year-term facility − calculated as the present value of the payments

associated with the debt and based on the applicable yield curve and RTL Group credit spread − amounted to €513 million at

31 December 2022. This loan was set-off at the beginning of March 2023 by two new term loan facilities in the amount of €200 million and

€300 million respectively as described below.

– The interest rates for loans under the revolving and swingline facility were EURIBOR (floored at zero per cent) plus a margin of 0.40 per

cent per annum, and ESTR (floored at zero per cent) plus a margin of 0.40 per cent per year, respectively. A commitment fee of 30 per cent

of the applicable margin was payable on the undrawn amount of the total credit facility. At 31 December 2022, the total of revolving and

swingline loan amounted to €nil million. The Revolving Credit Facility was renewed at its anniversary with the new market conditions as

described below.

In February 2023, RTL Group GmbH and Bertelsmann SE & Co. KGaA entered into a shareholder loan agreement pursuant to which

Bertelsmann makes available a revolving and swingline facility in the amount of up to €600 million. This agreement was amended in May

2023 with the parties to the contract being replaced by RTL Group SA and Bertelsmann Business Support Sàrl. With all conditions remaining

unchanged, the facility was increased to be up to €900 million. The main terms of this facility are:

– Interest rates for loans under the revolving and swingline facility are EURIBOR (floored at zero per cent) plus a margin of 0.40 per cent per

annum, and ESTR (floored at zero per cent) plus a margin of 0.40 per cent per year, respectively.

– Additional utilisation fees of 0.075/0.15/0.30 per cent per year are computed for the utilisation of each subsequent tranche of €200 million,

respectively, or €300 million under the amended agreement,

– with an upfront fee of 0.25 per cent and a commitment fee of 14 basis points calculated and payable on the undrawn amount of the total

credit facility.

In March 2023, RTL Group GmbH and Bertelsmann Business Support Sàrl entered into a shareholder loan agreement pursuant to which

Bertelsmann makes available two term loan facilities in the amount of €500 million. The main terms of these facilities are:

– Term loan facility of €200 million until 9 March 2026 bearing a fixed interest rate of 3.60 per cent per annum

– Term loan facility of €300 million until 7 March 2028 bearing a fixed interest rate of 3.57 per cent per annum

– RTL Group GmbH has the right to repay the loans early subject to break costs.

In May 2023, RTL Group SA and Bertelsmann Business Support Sàrl entered into a shareholder loan agreement pursuant to which

Bertelsmann makes available a term loan facility in the amount of €100 million until May 2027 bearing a fixed interest rate of 3.805 per cent

per annum.

At 31 December 2023, the term loan balance amounts to €770 million and the total of revolving and swingline loan amounts to €nil million.

The interest expense for the financial year 2023 amounts to €29 million (2022: €14 million). The commitment fee charge for the financial

year amounts to €3 million (2022: €3 million).

In 2023, Bertelsmann SE & Co. KGaA guaranteed RTL Trust e.V. deferred payment obligations to employees for a total amount of

€296 million. The guaranteed companies are RTL Television GmbH, Ad Alliance GmbH, VOX Television GmbH, RTL interactive GmbH, RTL

Nord GmbH, RTL West GmbH, RTL Hessen GmbH, RTL News GmbH, CBC Cologne Broadcasting Center GmbH, n-tv Nachrichtenfernsehen

GmbH, RTL Journalistenschule für Fernsehen und Multimedia GmbH and RTL Deutschland GmbH. The guarantee is counter-guaranteed by


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RTL Group SA. The commission is 0.35 per cent. On 31 December 2023, the guarantee amounted €296 million. This guarantee replaced

previous bank guarantees. The commitment fee charge for the financial year amounts to €1 million.

Tax

On 26 June 2008, the Board of Directors of RTL Group agreed to proceed with the tax pooling of its indirect subsidiary RTL Group GmbH

(RGG) into BCH, a direct subsidiary of Bertelsmann SE & Co. KGaA.

To that effect, RGG entered into a Profit and Loss Pooling Agreement (PLP Agreement) with BCH for a six-year period starting

1 January 2008. Simultaneously, Bertelsmann SE & Co. KGaA entered into a Compensation Agreement with CLT-UFA, a direct subsidiary of

RTL Group, providing for the payment to CLT-UFA of an amount compensating the above profit transfer and an additional commission

(‘Commission’) amounting to 50 per cent of the tax saving based upon the taxable profit of RGG.

Through these agreements, as from 1 January 2008, Bertelsmann SE & Co. KGaA and the RGG sub-group of RTL Group are treated as a

single entity for German income tax purposes.

As the PLP Agreement does not give any authority to BCH to instruct or control RGG, it affects neither RTL Group nor RGG’s ability to manage

their business, including their responsibility to optimise their tax structures as they deem fit. After six years, both PLP and Compensation

Agreements are renewable on a yearly basis. RGG and CLT-UFA have the right to request the early termination of the PLP and Compensation

Agreements under certain conditions.

On 15 May 2013, the Board of Directors of RTL Group agreed to the amendment of the Compensation Agreement in light of the consumption

of the trade tax and corporate tax losses at the level of Bertelsmann SE & Co. KGaA and of the expected level of indebtedness of RTL Group

in the future.

The PLP Agreement was slightly amended in 2014 on the basis of a recent change to German corporate tax law and in 2022 following the

acquisition of Gruner + Jahr Deutschland GmbH, Deutsche Medien Manufaktur GmbH & Co KG and 11 Freunde Verlag GmbH & Co KG.

In the absence of specific guidance in IFRS, RTL Group has elected to recognise current income taxes related to the RGG sub-group based on

the amounts payable to Bertelsmann SE & Co. KGaA and BCH as a result of the PLP and Compensation Agreements described above.

Deferred income taxes continue to be recognised, based upon the enacted tax rate, in the consolidated financial statements based on the

amounts expected to be settled by the Group in the future. The Commission, being economically and contractually closely related to the

Compensation, is accounted for as a reduction of the tax due under the Agreements.

At 31 December 2023, the balance receivable to BCH amounts to €18 million (2022: €322 million payable) and the balance receivable from

Bertelsmann SE & Co. KGaA amounts to €10 million (2022: €306 million).

For the year ended 31 December 2023, the German income tax in relation to the tax pooling with Bertelsmann SE & Co. KGaA amounts to

€nil million (2022: €32 million). The Commission amounts to €10 million (2022: €16 million).

As from 1 July 2019, RGG entered into the VAT tax group with Bertelsmann SE & Co. KGaA. Bertelsmann SE & Co. KGaA and the RGG sub-

group are treated as a single entity for German VAT purposes.

The UK Group relief of Fremantle Group to Bertelsmann Group resulted in a tax income of €8 million (2022: €6 million).

All Danish entities under common control by an ultimate parent are subject to Danish tax consolidation, which is mandatory under Danish tax

law. Riverty Denmark A/S – a 100 per cent held subsidiary of Bertelsmann SE & Co. KGaA – was elected as the management company of the

Bertelsmann Denmark Group.

All Spanish entities with a direct or indirect shareholding of at least 75 per cent by an ultimate parent are subject to Spanish tax consolidation

which is mandatory under Spanish tax law. Bertelsmann SE & Co. KGaA appointed Bertelsmann España, S.L. as Spanish representative of the

consolidated tax group in Spain.


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		124

10.2 Transactions with investments accounted for using the equity method

The following transactions occurred with investments accounted for using the equity method:


	2023	2022
	€m	€m

Sales of goods and services to:
Associates	37	33
Joint ventures	15	31
	52	64
Purchase of goods and services from:
Associates	26	26
Joint ventures	11	10
	37	36
Accounts receivable from:
Associates	19	10
Joint ventures	6	8
	25	18
Accounts payable to:
Associates	9	8
Joint ventures	1	–
	10	8
Off-balance sheet commitments against:
Associates	22	9
Joint ventures	–	–
	22	9
Off-balance sheet commitments from:
Associates	13	–
Joint ventures	1	4
	14	4

In the financial year 2023, the interest income from joint ventures amounted to €2 million (2022: €1 million). Also in 2023, RTL Group made

capital contributions to joint ventures amounting to €4 million and to associates amounting to €1 million.

In the financial year 2022, in addition to the capital contributions in Salto, RTL Group made further capital contributions to joint ventures

amounting to €2 million and to its investments in associates amounting to €4 million.

10.3 Transactions with key management personnel

In addition to their salaries, the Group also provides non-cash benefits to key management personnel and contributes to a post-employment

defined benefit plan on its behalf.

The key management personnel compensation is as follows and includes benefits for the period for which the individuals held the Executive

Committee position:


	2023	2022
	€m	€m

Short-term benefits	5.0	6.3
Post-employment benefits	–	–
Long-term benefits	1.2	1.5
	6.2	7.8

Further details on the remuneration of key management personnel can be found in the remuneration report.

10.4 Directors’ fees

In 2023, a total of € 1.4 million (2022: €1.3 million) was allocated in the form of attendance fees to the non-executive members of the Board

of Directors of RTL Group SA and the committees that emanate from it, with respect to their functions within RTL Group SA and other Group

companies.


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		125

11. Subsequent events