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DEAG rebounds as UK business boosts Q3 earnings

Sales in the third quarter soared from €4 million to €16.7m thanks to sold-out concerts by the likes of Gorillaz

By James Hanley on 23 Nov 2021

DEAG FY 2018, significant growth

Peter Schwenkow


Berlin-based Deutsche Entertainment Group AG (DEAG) has reported a 126% increase in sales for Q3 2021, thanks largely to the performance of its UK business.

After the first six months of the year were severely impacted by the pandemic, sales in the third quarter soared from €4 million to €16.7m, while EBITDA rose by 617% from €600,000 to €4.3m.

The upturn is mostly attributed to the UK, DEAG’s operating most important market outside Germany, where concerts are already taking place again at full capacity. Its Kilimanjaro Live subsidiary has organised sold-out concerts and tours by the likes of Gorillaz in the region. The first events have also been held in Germany.

Sales revenues amounted to €24.1m whereas, in the nine-month period in 2020 when the first quarter was only slightly affected by the pandemic, revenues were €39.1m.

DEAG and the entire live entertainment industry are finally gaining momentum again

“DEAG and the entire live entertainment industry are finally gaining momentum again after well over a year without concerts and events,” says company CEO Peter Schwenkow. “We look forward to offering our visitors hundreds of concerts and events in the months to come and expect to achieve a significant increase in earnings in the fourth quarter.

“In the meantime, the situation with the epidemic in Europe is leading to a daily reassessment of the current situation in all national markets. We are adequately protected against possible risks arising for us from the currently rising corona figures by extensive measures taken by the respective country governments and our insurance coverage. Our very robust financial position and a uniquely high event density for 2022 show our excellent positioning for growth in the coming year.”

The group also credits its ticketing platforms, the companies acquired in 2021 as part of DEAG’s acquisition and integration strategy, together with the provision of new services, for the improved performance. In addition, it mentions the enormous cost-cutting programme in the group as well as inflows from subsidy programmes, which DEAG has taken advantage of in all national markets, and its continued full insurance coverage.

DEAG, which reports strong advance sales for events in 2022, has expanded its successful Christmas Garden format to 18 locations – eight of them in other European countries – in the 2021/2022 season. New additions in Germany include Cologne, Frankfurt/Main and Hanover, as well as internationally in Paris, Barcelona and Windsor Park in London.

“Based on these, the significant revival in the UK and growth impulses from the companies acquired in 2021, DEAG expects another significant increase in earnings with high visibility in the fourth quarter of 2021,” concludes the report.

Last week, Munich-based live entertainment giant CTS Eventim posted “encouraging” financial results for Q3 2021, powered by improved ticket sales.

 


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