Sky Italia closes a horrible 2020 with a loss of 690 million euros, compared to the 18.8 million red in 2019. It is the first time that the broadcaster has produced a 12-month balance sheet ending on December 31st. It was Covid, the new controlling shareholder Comcast has introduced new administrative best practices and new accounting standards have also arrived that have recommended some write-downs. However, the analysis of Sky Italia’s accounts is quite simple: in the face of 2020 revenues which fell by 11.8% to 2.888 billion euros, production costs even went up by 1.1%. Sky, that is, unlike others, did not have the flexibility to correlate its cost structure (determining the sports TV rights, which are paid regardless) to the sharp drop in revenues. As the administrators explain, there was a decline of 178 million euros in revenues from residential subscriptions, standing at 2.39 billion euros compared to 2.57 billion in 2019, as “the subscriber base is falling”; advertising sales decreased by 171 million euros (166 million overall in 2020 compared to 337 in 2019).
Costs, on the other hand, followed different dynamics: production costs, as mentioned, rose by 1.1% to € 2.865 billion. The cost of labor fell by 4% to 236 million euros. And already at the ebitda level, Sky Italia’s 2020 balance sheet shows a loss of 213.1 million euros, compared to the positive 196.3 million in 2019. As often happens, a balance already destined to close in negative is also used to make some cleaning. And here, therefore, amortization and permanent losses from writedowns for 674.6 million euros (compared to 232 million in 2019), with, for example, the cancellation of the Goodwill item, recognized in the financial statements for 299 million euros. The combined effect of amortization, depreciation and write-downs resulted in a negative EBIT or operating result for Sky Italia of 887.8 million euros.
In short, the directors of Sky Italia continue, the group, at the end of 2020, found itself «with a strong equity imbalance, financial tension, but without repercussions on liquidity. The first months of 2021 also recorded a negative trend, with a considerable decrease in revenues from bars and hotels ». Yes and therefore arrived “with a capital deficit at the date of preparation of the financial statements (June 2021, ed.)”. And for this reason, the loss of 690 million euros was covered by fully using both the legal reserve (52.3 million) and the other reserves (505.3 million). Since the loss also reduced Sky Italia’s share capital by over a third, the parent company Comcast, through Sky Uk ltd, paid 1,
No official figures are provided regarding the number of Sky Italia subscribers. Certainly it has fallen below 4.8 million, but there are no signs of vertical collapses after the passage of all Serie A football to Dazn. The new CEO of Sky Italia, Andrea Duilio, who last Monday officially took over from Maximo Ibarra, who resigned on May 18, will therefore have a rather demanding task, but a draconian plan to cut the workforce is already ready, with the release of 2,750 units (25% of the total) in the next four years. And, thanks to the new Serie A and Champions TV rights policies, it will also be able to count on over 800 million euros in savings per year for the next three years.
