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Highlight’s sports and event sales up after higher Team Marketing commission

Vew of match ball prior to Uefa Champions League match between Liverpool and Genk (Photo by Alex Pantling/Getty Images)

Highlight Communications, the Switzerland-based media company, has reported a 1.5-per-cent uplift in sales at its sports and event marketing unit in 2019, thanks in part to a higher commission earned by its Team Marketing agency on the sale of rights to Uefa club competitions.

Highlight owns all of Team Holding, the holding company of the Luzern-based agency that markets the broadcast, sponsorship and licensing rights to the Uefa Champions League and Europa League, along with the third-tier Europa Conference League (to be launched in 2021-22).

The narrow uplift in sales at the sports and event operations came as Highlight reported overall group sales of CHF486.8m (€460.8m/$501.1m) in 2019, a year-on-year fall of 8.4 per cent. Earnings before interest and taxes (Ebit) fell by 7.5 per cent to CHF29.5m, a fall blamed on currency effects.

Highlight said: “At CHF64.7m, external sales in the Sports- and Event-Marketing segment were up by 1.5 per cent on the previous year’s level (CHF63.7m). The increase was due to the higher agency commission that the Team Group generated as a result of the successful marketing of Uefa club competitions. At CHF29.2m, segment earnings were down 7.6 per cent on the previous year (CHF31.5m).”

Analysing Team’s performance as it kicked off the rights sales process for the new cycle, Highlight stated: “The Team Group successfully completed the development of commercial concepts and rights packages for the 2021-22 to 2023-24 cycle of the Uefa Champions League, the Uefa Europa League, and the new Uefa European Conference League in the reporting year.

“As a result, Team was able to start selling the commercial rights in the second half of the year. Team experienced a strong start to its sales operations on both the media and the sponsorship sides, closing several key deals early on.”

Early deals struck by Team included an agreement with UK telecoms operator BT worth £400m (€455.9m/$495.6m) per year, the largest deal ever struck by the agency. Meanwhile, strong rights fee increases were secured in France, Germany and USA. The agency has also contracted deals or agreed fees with a string of sponsors for the new cycle, as recently reported by SportBusiness.

Highlight noted that Team has “experienced a strong start to its sales operations on both the media and the sponsorship sides, closing several key deals early on”.

Within its newly-published annual report, Highlight has also expressed its appetite to renew Team’s mandate with Uefa beyond the end of the 2023-24 season.

Highlight said that, based on Team’s “long-term collaboration with Uefa” on the sale of rights to its club competitions, the “prospects for continuation of the close co-operation…subject to Team’s ongoing performance” are “very strong”.

Highlight added that this opportunity “continues to be classified as medium”. Uefa has traditionally extended its mandate with the agency for three-year cycles upon specified revenue targets being met.

Sport1 Medien, Covid-19 effect monitored

Sales at Highlight’s sports segment, which includes the business of the recently rebranded German media group Sport1 Medien, totalled CHF119m in 2019.

Highlight said: “In the reporting year, the sports segment continued to focus on optimising its portfolio of rights, improving existing digital content and creating new digital content for cross-platform exploitation.”

Constantin Medien rebranded to Sport1 Medien at the turn of the year following the company delisting from the Frankfurt Stock Exchange after a proposal lodged by Highlight in August last year.

Sport1 Medien’s subsidiaries include its flagship German sports broadcaster Sport1, production company Plazamedia, and Match IQ, the agency that organises friendlies and training camps for German clubs. Magic Sports Media, the betting agency, and Leitmotif Creators, the design agency, also sit underneath the Sport1 Medien umbrella brand.

Highlight owns 94 per cent of Sport1 Medien.

Sport1 acquired various live broadcast rights in football, motorsports and volleyball in 2019 and also launched eSports1, the subscription linear channel dedicated to esports. Highlight said that the channel, which is priced at €5.99 ($6.41) per month on a standalone basis (but also part of wider packages), had 1.11 million subscribers at the end of 2019.

Sport1+, the broadcaster’s pay-television channel, boasted 2.43 million subscribers at the end of 2019.

The flagship free-to-air Sport1 channel was available in 31.9 million households in 2019, down from 32.7 million in 2018. It registered a market share of 0.7 per cent among viewers over three years of age and 1.1 per cent in the core market of men between 14 and 59.

On its group financial outlook amidst the ongoing Covid-19 pandemic, Highlight said: “The new coronavirus strain has continued to spread around the world in the first quarter of 2020. Given this development, the board of directors is not currently able to issue a forecast for fiscal 2020.

“The board of directors is monitoring the situation and will take the corresponding action when necessary. The board of directors assumes that the spread of coronavirus will affect the Highlight Group.”