In a context of persistent speculation that its Mohn family owners and chairman/CEO Thomas Middelhoff were in the process of clearing the decks prior to taking Bertelsmann into the market, the group has released six-month results indicating that--in its own words--it has "overcome weaknesses" and has virtually wiped out debt. The half-year under review (July 1-December 31, 2001) is referred to as a "stub period," since the group will align its business cycle with the calendar year.
During this period, the global media group reported sales of 9.7 billion euros (nearly $8.65 billion at a January conversion), EBITDA of 1.7 billion euros ($1.5 billion) and net income of 931 million euros ($828.5 million). The earnings include a gain of 2.2 billion euros from the sale of its AOL/Europe and AOL shares. Middelhoff noted that based on the first months of business in 2002, earnings for the current full year will exceed the record results of the last July-to-June reporting period, with most corporate divisions showing improvement, due to a "streamlined" structure and further capital gains. Among measures undertaken to improve performance, the statement cites comprehensive restructurings of Random House North America as well as BMG's Music Service club and other multimedia ventures. Internet start-up losses have been reduced to 226 million euros, notably in e-commerce (BOL, BN.com and CDNOW ). Summing up, chairman/CEO Middelhoff declared: "We have created the framework for the new Bertelsmann. Now we will develop our positions and shape the markets."
