- Televisa will raise prices, VP Alfonso de Angoitia says
- Pricing transition throughout 2016 will be complicated
Grupo Televisa SAB, Mexico’s largest broadcaster with a 70 percent market share, said advertising revenue growth will be "as challenging" in the rest of the year as it’s been in the first half.
"Televisa will be raising prices to capture the proper value of the audiences that it reaches," Executive Vice President Alfonso de Angoitia said in a statement after presenting at a Goldman Sachs investors conference in New York.
The stock has fallen 20 percent since the Mexico City based-company reported second-quarter results in July, when it missed sales and profit estimates. Ad sales tumbled 16 percent to 5.2 billion pesos as Televisa offered free spots to political parties. A year earlier, the broadcaster had also benefited from a boost from the soccer World Cup.
"The implementation of the new pricing structure in the advertising sales business will be difficult, and its effects will take time to materialize," Angoitia said. The complicated pricing transition will continue to take place throughout 2016, he added.
Televisa has been relying on the growth of its pay-TV business through units including the Sky satellite service and the rebranded cable provider Izzi.
Sky, which had about 6.9 million subscribers in Mexico at the end of the last quarter, reported a 9 percent increase in sales last quarter and is continuing to beat the company’s growth expectations, Angoitia said. Izzi’s lower-cost offering is bolstering Televisa’s cable and telecommunications unit, he said.