On August 28, Gazprombank released its financial results for the January–June 2020 period, which showed key figures on Gazprom Media as part of the Media Business segment.

The unpredictability of COVID-19, which emerged in the second quarter and led to a nationwide lockdown, made the biggest impact on the company’s financial performance in the first half of 2020. This situation especially affected Gazprom Media’s key media market segments: television, sports broadcasting and film distribution.

The second quarter of 2020 was challenging for media holdings. Movie theaters were closed to the public, while top sports competitions were suspended or postponed, including Euro 2020. Moreover, there was a decline in overall business activity, which negatively impacted television advertising. Some advertisers decided to move their budgets to the fall. 

Key financial figures of the Media Business segment for January–June 2020:
●    Consolidated revenues decreased 8% to 42.7 billion rubles due to a general decline in TV advertising and the absence of sporting events and film distribution in the second quarter.
●    Advertising revenues decreased 8%, totaling 30.5 billion rubles.
●    Nonadvertising revenues decreased 7% to 12.2 billion rubles due to decreased income from the sale of rights to audio and video content and the sale of broadcast services, while movie theaters and sporting venues were closed in the second quarter.
●    Consolidated expenses decreased 3% to 42.9 billion rubles due to efficient cost management. As a result of the pandemic and the specifics of the media business, cuts were made to the costliest operations. For example, there was less spending on content as TV channels aired reruns of popular shows. Premiere projects were rescheduled for future use. Moreover, there were no longer any expenses on broadcasting sporting events, which helped to offset the overall decrease in income.
●    The operating loss totaled 184 million rubles. The net loss was 1.3 billion rubles as a result of the general economic decline in the context of the epidemiological situation. Sharp fluctuations in the exchange rate also had an effect on the revaluation of foreign exchange liabilities.

Key financial figures of the Media Business segment for April–June 2020:
●    Consolidated revenues decreased 22% and added up to 17.8 billion rubles as a result of a 19% decrease in advertising revenues in the context of a general decline in the TV advertising market, as well as a 35% decrease in income from the sale of rights to audio and video content, while film distribution and sports broadcasts remained suspended.
●    Consolidated expenses decreased 11% to 19.6 billion rubles. The pandemic and the specifics of the media business influenced the decision to cut costs.
●    Operating loss totaled 1.8 billion rubles, while the net loss was 2.2 billion rubles.

During the lockdown and nonworking days, the Holding’s television channels adapted to create new forms of content, such as screen-life series, sociopolitical programs without in-studio audiences, and shows done via videoconferencing. This approach made it possible to maintain audience numbers for the Holding’s channels, which partially offset the overall decline in the market. Moreover, Gazprom Media benefited from successful premieres and reruns of popular projects during the second quarter*.

On April 26, NTV released the finale of the musical show Maska (The Mask), which had a record number of television viewers: 28.8% share, 10.7% rating. These were the best numbers for any entertainment program on Russian television since December 2016 and the best for a musical show since December 2013. At the show’s climax, when the winner takes off their mask, the audience share reached 38%. 

The channel’s premiere content also had high ratings: Ded Morozov (Grandfather Morozov) led in its time slot on May 10 with a share of 15.2% and a rating of 4.8%, while the new show Aleks Lyutyy drove NTV to the top of the evening primetime slot thanks to its average share of 14.9% and rating of 4.3%. The second season of Dinozavr-2 (Dinosaur 2) also had good numbers (13.4% share, 4.4% rating), as did the new series Ricochet (13.1% share, 4.6% rating). Moreover, viewers continued showing an interest in NTV news broadcasts in the second quarter. In April Itogi Nedeli (Weekly Summary), hosted by Irina Zeynalova, became the best weekly analytical program on Russian TV. The average share of the program in the second quarter was 14.1%, while its rating was 4.5%.

Similarly, the series premieres that aired on TNT led in their evening time slots. The new show Mir! Druzhba! Zhvachka! (Peace! Friendship! Chewing Gum!), made by Good Story Media, had a viewership share of 11.4%, while the new seasons of Realnye Patsany (Real Guys) and Politseysky s Rublyovki (Policeman from Rublyovka) also got good viewership shares: 12.7% and 11.9%, respectively. Viewers were also drawn to the new series Proekt Anna Nikolaevna (10.8% share) and 257 Prichin, Chtoby Zhit (257 Reasons to Live, 9.7% share). 

The second season of the show Posledniy Geroy (The Last Hero) aired on TV-3 in the second quarter, and the finale got the biggest share in Russia: 9.3%, and 11.2% in Moscow. The premiere of the new season of Znaki Sudby (Signs of Fate) had an average season share of 5.6%. Moreover, TV-3 brought in 50% more sponsorship funding in January–April when compared with the same period last year thanks to its own program lineup.

Two premieres got high audience numbers on Friday! in the second quarter. The new show Boy s Girls (Fight with Girls), hosted by popular comedians and actors Ekaterina Varnava and Aleksandr Gudkov, had an average share of 5.1%, while the new season of the culinary project Konditer (The Confectioner) featuring Renat Agzamov had a share of 4.8%. The next installments of Na Nozhah (Knives at the Ready) and Mir Naiznanku (The World Inside Out) also had solid ratings: 7.6% and 6.1%, respectively.

Gazprom Media prides itself on being a socially responsible business, and the PREMIER video service was the first and only online movie theater to give viewers free access to content created by Gazprom Media’s studios and television channels during the quarantine in Russia (from March to June 2020). NTV-Plus also gave free access to high-quality content (up to 190 channels covering various topics) to current and new satellite and OTT subscribers at the time.

*Mediascope, Russia, cities with a population of more than 100,000 people, April 1–June 30, 2020, audience aged 14–44 for TNT, TV-3, and Friday! and 18+ for NTV. Average viewership share (%), rating (%).