Nent flags up $73m fourth-quarter strategic realignment charge

Media company Nordic Entertainment (Nent) Group has said it will take a SEK700m (€66.3m/$73.4m) one-off charge in the fourth quarter relating to job cuts and write-downs of free-to-air television content as it continues a move to a new operating model with a renewed focus on its Viaplay streaming service.

Nent said the personnel savings are expected to be approximately SEK250m, with the majority impacting in 2020. It added that this will allow it to offset US dollar currency headwinds and continue to invest in the expansion of Viaplay, stating there will be no change to the group’s profitable growth commitment for 2020.

Nent, the dominant sports broadcaster in the Nordic region, said it has simultaneously undertaken a review of its content-related agreements and investments, which has resulted in the decision to write down the value of certain free-television content and other assets.

The company said: “This primarily reflects the ongoing change in the type of content that Nent Group shows, and the fact that historic free-TV output deals with long-term series commitments have limited remaining value.”

The announcement comes after it emerged in October that Anne Tufte, head of sport in Norway at Nent, was to leave the broadcaster as one of 45 announced job losses. Nent revealed that 39 employees of the Norwegian television business and six from the radio business are leaving.

At the start of September, Nent revealed details of a wide-ranging group restructuring of its senior management team to be implemented on October 1. At the time, Nent said that the model would be “the best structure for a leading streaming player and content producer with multi-market strategy and significant growth ambitions”.

In future, Nent will be based in its entirety under one management group located in Stockholm. With the removal of national leadership teams, the central leadership group, led by president and chief executive Anders Jensen, will be reduced from 15 to eight.

Jensen said: “Our new function-based organisation enables us to even better capture the significant growth opportunities that we see in the Nordic streaming market, while also preparing us for further expansion. It is always very hard when colleagues have to leave, but this is a necessary step for us to be able to work and invest even smarter.

“The success of Viaplay is also fundamental in our decision to write off certain content elements that we consider to be of low or no value in our journey as a leading streaming company. There is no change to our outlook for profitable growth in 2020. We are building something quite unique in our industry, and these changes will keep us constantly ahead of the curve.”