Sam Barnett, CEO of MBC Group Co.
MBC Group CEO Sam Barnett confirmed that the number of subscribers to Shahid platform leapt 40% to nearly four million by the end of 2023 compared with a year earlier. He added that the group managed to significantly cut Shahid’s net losses.
Here’s the full interview with Barnett:
Q: As you report your first financial results following your recent IPO, can you provide an overview of your financial performance for the past year, highlighting key milestones and achievements since going public?
A: As we present our inaugural financial results post-IPO, it’s crucial to highlight several key indicators that reflect our resilient performance over the past year. Total revenues in 2023 reached SAR 3.7 billion ($987.7m), a 6.2% increase compared to 2022, driven by solid growth across all the Group’s income generating business segments, notably Shahid.
The Group’s gross profit increased by 43.7% year-on-year (YoY) to SAR 921 million ($ 245.7m). Net income for the 12-month period was SAR 69 million, a 45% YoY increase compared to 2022 and surpassing our expectations. One of the key reasons for the substantial increase in net income was the outstanding performance of Shahid, which saw a strong increase in subscribers in 2023 reaching almost 4 million. We also managed to significantly reduce Shahid’s net losses, which further enhanced our bottom line. Net income margin for 2023 was 2%, which is in line with the Group’s guidance for the year.
Our robust performance in 2023 reinforces our leadership position in the media and entertainment industry in the MENA region. Through the execution of our strategy across all our segments, including Broadcasting and Other Commercial Activities, Shahid and Media & Entertainment Initiatives, we were able to capture growth opportunities and enhance our resilience enabling us to navigate more challenging periods. We are excited for what lies ahead and believe that MBC Group is posted for continued growth and innovation. We remain committed to delivering exceptional content and experiences to our audiences and subscribers while maximizing value for our advertisers and shareholders.
Q: What were the key drivers behind the advertising growth within both broadcasting and other commercial activities and Shahid business segments, and how do you plan to sustain or enhance these drivers in the coming years?
A: In 2023, MMS experienced significant revenue growth driven by a diverse client portfolio and the expansion of Shahid’s AVOD platform. Our strategy to deepen relationships with clients and offer tailored solutions contributed to this success. We also leveraged audio content such as podcasts and sports programming, both of which played pivotal roles in driving revenue growth.
What sets MMS apart from competitors is our extensive relationships with top local and international agencies, enabling us to leverage existing leadership positions and maximize revenues through programmatic ad sales. Looking ahead to 2024 and beyond, our strategic growth plans for MMS include a pivotal focus on digital streaming services, recognizing the growing consumer appetite for on-demand content. We also aim to re-establish TV as a foundational element and diversify our content and advertising strategies to include niche markets and audio platforms, broadening our reach.
Additionally, initiatives like ‘SHAHID Always On’ showcase our commitment to staying ahead in the digital transformation wave. Also, building a digital monetization ecosystem will enhance our digital revenue streams through innovative technology and platforms.
Q: How do regional or global economic trends impact the performance of your three business segments: Broadcasting & Other Commercial Activities; Shahid and Media & Entertainment? And what measures are in place to mitigate any adverse effects?
A: Regional and global economic trends play a significant role in shaping any business. Fluctuations in economic conditions, as well as other factors, can directly impact consumer behavior and spending patterns, market demand, and overall business operations. We prioritize stability by diversifying our market presence across regions and countries and maintaining operational flexibility. By expanding our geographic footprint, the Group can mitigate risks associated with economic downturns in any single market.
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