Central European Media Shares Slump on Record Loss: Prague Mover
Central European Media Enterprises Ltd. (CETV) fell the most in four months as the television broadcaster unexpectedly posted a record loss for last year.
The stock declined 8.7 percent to 95 koruna by close in Prague, its steepest one-day drop since Oct. 31 and the worst performance in the PX (PX) index. Turnover was almost four times the daily average over the past three months.
CME, as the Bermuda-registered operator of stations in emerging Europe is known, said its net loss tripled to $546 million as it booked a $522 million non-cash impairment while clients cut spending on advertisements. The median estimate of seven analysts polled by Bloomberg was for a $27 million loss.
“We consider the results negative,” Pavel Ryska, an analyst at J&T Banka AS in Prague, wrote in an e-mail to clients. He has a hold recommendation for CME, with a $6 price estimate for the company’s U.S.-listed shares.
In New York, the stock declined 10 percent to $4.75 by 10:55 a.m. local time, the lowest price this year, valuing the company at $366 million.
The company is facing a drop in ad revenue as the region’s economies struggle to recover from a slowdown. CME plans to cut costs and is in talks with its 49.9 percent shareholder Time Warner Inc. (TWX) regarding its possible participation in a public or private equity offering, according to today’s statement.
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