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BBC Worldwide returns £226.5 mn to BBC

MUMBAI: BBC Worldwide has published its 2014/15 Annual Review, announcing stable headline results, record returns to the BBC and continuing investment and transformation plans for the business.

  • Record returns to the BBC, up almost a third to £226.5 million; pledge to return around £1 billion in five years from 2014/15, an increase of almost one quarter on previous five years
  • Headline profit was down by 11.9 per cent to £138.6 million, due to the impact of part-sale of BBC America to AMC Networks; headline profit on on-going operations up 4.1 per cent to £127.2 million.
  • Statutory profit before tax of £223.8 million, up 77.3 per cent, including £115.9 million profit on BBC America venture

Business Highlights

  • ‘Doctor Who’ season eight was the top selling programme of the year, licensed to 189 territories
  • BBC First, BBC Earth and BBC Brit launched in three markets in the year
  • Venture with AMC Networks paves the way for future growth and reach for BBC America
  • BBC.com continued to attract record numbers of unique browsers: up by 8.3 per cent, with a peak of 100.8 million

Creative Industries Highlights

  • Strong return to UK creative industries, with largest sales and distribution business in Europe delivering growth across finished programme and format sales
  • Investment in BBC programmes from BBC Production and independents increased by 6.2 per cent to £94.4 million
  • Total returns to the independent production sector of £113.1 million

Results reported are significantly impacted by the deal struck in October 2014 to form an equity partnership with AMC Networks for BBC America, making the channel, which delivered a 10th consecutive year of ratings growth, part of a larger portfolio with a shared emphasis on premium quality editorial.  Consequently 2014/15 revenue does not include BBC America for the majority of the second half of the year.  This is the major factor in headline sales being down by 3.9 per cent to £1,001.8 million (2013/14: £1,042.3m) and headline profit down by 11.9 per cent to £138.6 million (2013/14: £157.4m).

Adjusting for this, headline sales and profit on ongoing operations were up 0.4 per cent to £948.1 million (2013/14: £944.5 million) and 4.1 per cent to £127.2 million (2013/14: £122.2 million), respectively.  Foreign exchange movements in the year reduced headline sales by £19.5 million and headline profit by £3.2 million.

BBC Worldwide CEO, director, global Tim Davie said, “Through focusing on transformation and investment in 2014/15 BBC Worldwide delivered a solid performance, including record returns to our parent, the BBC, which remains our primary objective. Mindful of the ever-changing and competitive marketplace in which we operate we made a number of decisions to secure our future performance.  This included entering into a significant partnership with AMC Networks for BBC AMERICA, which can be seen in our results this year.

“We are proud to have launched our three genre brands BBC First, BBC Brit and BBC Earth in three key markets and delivered BBC Store, which will launch in the coming months in the UK. Our results announced today reflect these decisions as well as highlighting our ongoing ambition to deliver the highest quality content to our audiences and our ambitions to continue to support creative talent across the UK independent community.”

Returns to the BBC

Returns to the BBC grew significantly to £226.5 million, up by 30.3 per cent (2013/14: £173.8 million), underpinned by a solid operating performance and the proceeds of the partial disposal of BBC America.  This is the equivalent of 12.6 per cent of BBC Television’s content spend, up from 10.1 per cent in the previous year. Investment in BBC commissioned content was up 6.2% to £94.4m (2013/14: £88.9 million) and supported the commission of titles such as ‘The Hunt’, ‘9 Months That Made You’, ‘War and Peace’ and ‘SS-GB’.

BBC DG, BBC Worldwide chairman Tony Hall also announced that this year marked the first of a five-year plan to generate around £1billion in returns to the BBC, an increase of almost one quarter on the previous five years, reflecting the BBC’s determination to extract the maximum sustainable future contribution from commercial subsidiaries.

Increased support for the UK creative industries: Alongside the company’s on-going support for its parent, the year also witnessed a further increase in its commitment to the UK’s wider creative industries.  This included showcasing BBC and UK independent content across the globe, delivering a 3.2 per cent increase in TV sales, which are largely exports, to £345.3 million (2013/14: £334.6 million).  BBC Worldwide continued to represent over 250 UK independent producers, returning £113.1 million to the sector, a 2.9 per cent decrease on £116.4m in the previous year. In the year, BBC Worldwide made a number of strategic investments in emerging, high quality UK production houses, including Lookout Point, Curve Media, King Bert, Red Planet and Cuba Pictures.

Delivering on strategy: BBC Worldwide is also reporting good progress on its three-pronged strategy, first set out in October 2013.

Premium content: Premium content investment delivered a mix of titles, including drama – which accounted for almost half of total investment in the year.  Top-selling titles included ‘Doctor Who’, ‘Top Gear’ and ‘Orphan Black’.

BBC Worldwide’s production arms saw increased appetite for UK formats, with notable success in France, with revenue up by over 50 per cent and new and returning commissions including ‘Dancing with the Stars’, ‘The Weakest Link’ and ‘Bake Off’.  At year-end the ‘Bake Off’ format had been licensed to 19 countries, this year welcoming Turkey and Israel. ‘Dancing with the Stars’ in the USA celebrated its 10th anniversary and 20th series, while local versions of ‘Top Gear’ launched in France and China.

Global brands: The company launched three new genre brands in the year.  Drama channel BBC First debuted in Australia in August on Foxtel’s subscription platform, delivering its most successful non-sport channel launch in a decade.  Factual entertainment BBC Brit and premium factual BBC Earth made their linear debuts in Poland in February, with both channels outperforming established rivals and breaking into the top three in their competitive sets.  The Nordics became the second market for BBC Brit and BBC Earth post year-end, followed by the launch of BBC Earth in Turkey and Central and Eastern Europe. Elsewhere BBC First made its European debut in the Netherlands in May. BBC Earth also became the first of the three new brands to make its online debut, on both BBC.com and BBC.co.uk, generating an average of 3.1m unique browsers since launch in September.

Beyond channel launches, BBC Worldwide expanded audiences’ enjoyment of key BBC brands. New initiatives included the launch of CBeebies Land at Alton Towers, the initial roll-out of CBeebies English language learning centres in China as well as a 12-day global tour for series eight of Doctor Who, with the 12th Doctor and companion visiting South Korea, Australia, USA, Mexico and Brazil.