State-owned broadcaster RTÉ has gone into the black for the first time in five years, although the station admitted advertising and sponsorship revenue had fallen below expectations in 2003.
The broadcaster's results for 2003 show overall revenue up to €312 million from €271 million, mainly due to an increase in the licence fee granted by the Government in December 2002.
The station recorded a surplus of €2.2 million, reversing the deficit of €56 million posted in 2002. This is the station's first surplus since 1998.
It also reported a €21.5 million surplus on earnings before interest, tax, depreciation and amortisation (EBITDA). However due to intense competition from broadcasters like Sky, TV3 and various commercial radio stations, RTÉ's advertising/ sponsorship revenue fell by €3.7 million to €132 million.
The station said this reflected "difficult market circumstances" and RTÉ director-general Mr Cathal Goan said there was increased penetration by satellite operators and TV3 was "simulcasting more and more output with ITV in Britain".
Looking at 2004 the station's chairman, Mr Paddy Wright, said advertising in the first five months of the year was up on 2003, although he acknowledged the number of new radio licences issued by the Broadcasting Commission of Ireland (BCI) was having an impact on RTÉ's market share. Asked what surplus RTÉ might produce in 2004, Mr Wright said: "About the same as this year". He said the station would look for a full inflationary increase in the licence fee from the Government, but this was a matter for later in the year.
Mr Goan said a "more assertive marketing campaign" would be undertaken to promote RTÉ's radio offering, which has been losing significant market share.
"In radio in recent years, the increase in local targeted services has seen a decline in RTÉ's share as a national operator. This erosion has been the focus of particular strategic study in the radio division and a more assertive marketing campaign for the individual stations will shortly be in evidence across all media," he said.
Mr Conor Hayes, chief financial officer, said the station had totally overhauled its financial accounting and reporting systems, now covering six integrated business divisions.
Figures arising from this overhaul show that apart from licence fee revenue, the biggest contributors to the station's bottom line were commercial revenue from television, radio, networks and publishing.
These sections produced the following revenue amounts in 2003: television (€101 million); radio (€34 million); networks (€20 million) and publishing (€12 million).
The networks unit manages the station's collection of masts which are dotted around the State. RTÉ charges telecoms companies and fellow broadcasters like TV3 for using these masts. The publishing division refers to the RTE Guide and various revenue generating websites.
Mr Hayes said while the Government agreement to increase the licence fee by €43 was welcome, RTÉ had hoped for greater revenue from this area. He said licence fee income was collected by An Post and there was nothing RTÉ could do if certain targets were not met.
In the station's annual report Mr Wright said a "cursory glance" at employee numbers "may cause some concern". These figures show the total number of employees rising from 1,850 in 2002 to 2,135 last year.
Mr Wright said this was due to contractors moving onto the payroll following changes in Irish and European law. He said there was no extra cost to RTÉ. Despite remarks by the Minister for Communications, Mr Ahern, late last year that RTÉ had not reduced its staff numbers enough, Mr Wright said the station was at a comfortable level.
