How much profit does RTL Radio Luxembourg actually make?

RTL does not want to publish information about RTL Radio Luxembourg’s advertising revenue. The suspicion is growing that millions in revenue are being hidden so that the state pays more. RTL One has done the math for you.

RTL Luxembourg is known to be heavily in deficit because TV is so expensive. This was stated by Christophe Goossens, CEO of RTL, to the relevant chamber committee. This was stated by Xavier Bettel (DP), who as the then Minister of Media introduced the RTL financing law. And this is also stated by Tom Weidig (ADR), who is the only MP currently with insight into RTL’s finances. But what would actually happen if RTL Luxembourg’s radio made a profit?

RTL Radio Luxembourg is part of the Public Service

In 2017, during the Chamber debate on the previous concession, RTL and Xavier Bettel emphasized: „They should have talked about the future of Radio Luxembourg, and various things were changed in the agreement, but it is clear that only Télé Luxembourg will be financed, reiterates the Prime Minister, for whom the difference between TV and radio is now clearer. RTL Radio Luxembourg is not a public radio station and should not be.“

Not long after, everything changed. In May 2021, Xavier Bettel presented the next concession agreement in the relevant chamber committee as follows: „For the first time, radio services will be fully integrated into the agreement. This expansion reflects the „cross-media“ reality of society while aligning with the obligations in terms of financial transparency.“

This ultimately acknowledged a reality that had previously been vehemently contested by both the state and RTL. Namely, that at RTL, radio and television are mixed anyway. The mixing occurs in terms of content, material and also personnel. For example, 9 RTL journalists are registered with the Press Council for both radio and television. The website rtl.lu is used by all media sectors and the content is often the same on the website, on radio and on television.

Transparency?

However, the transparency of RTL Luxembourg’s finances that Xavier Bettel spoke about does not exist. This is primarily because RTL Luxembourg is not an independent company, but part of CLT-UFA, a multi-billion-dollar Bertelsmann group. A look into CLT-UFA’s accounts is therefore not enough.

In a recent Land article from last year, CEO Christophe Goossens did not want to comment on RTL-Luxembourg’s turnover. Whether he is allowed to withhold such information is probably a legal question that still needs to be clarified. After all, it is not just a private company, but a „public service“.

However, Christophe Goossens should not be trusted: His figures have already proven problematic. In 2020, he reports to the Chamber Commission, among other things, that TV advertising revenues are far too low, namely 6 million instead of the actual figure of over 8 million.

The country then cites the report of RTL Group, the direct parent company of CLT-UFA. In the 2022 balance sheet, there is only one sentence: „The revenue generated in Luxembourg amounts to € 91 million (2021: € 75 million)“. However, you can’t start anything with this information, because this probably only means „revenue from external customers“, and it is unclear which other companies, such as BCE, IP or Eldoradio, were included here.

In the more revealing figures in the RTL Group report on advertising revenue, the activities of the Belgian and Dutch RTL are lumped together with the Luxembourg RTL in a „Benelux“ pot. There are therefore no public figures on the finances of RTL Radio Luxembourg. Or?

Is RTL Radio Luxembourg in deficit?

The only official figures available for RTL as a whole are those from a table in the current concession agreement. The „net advertising revenue“ of the entire RTL would be €15.5 million for 2024. According to the previous concession, which only provides the figures for television, television’s advertising revenue in 2023 was €9.2 million. It cannot be assumed that there were any major fluctuations in the period 2022 - 2024. Some €6.3 million in advertising revenue would therefore have to come in via radio and the Internet for RTL to break even.

The expenditure (not to be confused with the revenue) on advertising is listed every year in Luxembourg in the so-called „Ad’Report“. Can these figures be trusted? This report is always based on figures provided by IP, the advertising department of RTL, among others. They are therefore practically first-hand. A look at the most recent report shows that in 2022 €12.6 million was spent on TV advertising, €24.7 million on radio and €16.2 million on the internet. The ratios between TV, radio and the Internet in this report alone should be surprising: more than three times as much money is spent in Luxembourg on radio and the Internet as on television advertising. And yet, RTL’s advertising revenues from the Internet and radio combined are significantly lower than those from television? The ratio of advertising expenditure in the Ad’Report to advertising revenues in the concession agreement also seems suspicious: €12.6 million is spent on television, but RTL only records €9.2 million as revenue? Could this be due to the high production costs for television spots? It is known, however, that the production costs for a TV spot are significantly higher than for a radio spot - which again speaks in favor of higher radio revenues. It is worth taking a look at the details.

For TV, Ad’Report only has one reference medium - RTL TV Luxembourg. For radio, the picture is not so clear at first glance: Here, Ad’Report combines the figures of Eldoradio, L’essentiel Radio and Radio Latina with those of RTL Radio Luxembourg in its own statements. However, this does not mean that no statement can be made about the revenues of RTL Radio Luxembourg - quite the opposite.

The radio station is the golden donkey of RTL Luxembourg

There are official balance sheets for both Eldoradio and L’essentiel Radio. According to its own, public balance sheet, Eldoradio generated €2.8 million in advertising revenue in 2022, and L’essentiel Radio’s balance sheet for 2022 was €1.1 million. That leaves Radio Latina, which has a significantly smaller market share. If you compare market shares or even the prices for advertising (at Eldoradio at peak times €242 for 30 seconds, at RTL Radio Luxembourg €880), you can start to make estimates. RTL Radio Luxembourg has twice as many listeners as Eldoradio and a wealthier clientele. Logically, there should be at least €6 million in advertising revenue at RTL Radio Luxembourg. However, with advertising reports and elaborate games such as „Viva Vakanz“, RTL Radio Luxembourg has significantly more diverse sources. Are the radio’s revenues over €6 million?

Even looking at the Ad’Report, there might even be a good chunk more. The share of TV advertising expenditure that will later be recorded as revenue at RTL (i.e. figures from Ad’Report 2022 vs. figures in the concession agreement for the year 2022) is 70%. For radio advertising expenditure, there should be even significantly lower production costs. But to make a very conservative estimate, one can also apply 70%. In 2022, radio stations should have received €17.5 million in advertising revenue. Of this, €2.8 million will go to Eldoradio, €1.1 million to L’essentiel Radio and perhaps €0.6 million to Radio Latina. There would be min. €13 million left for RTL Radio Lëtzebuerg in advertising revenue, with lower production costs even more likely €18 million. This revenue should now actually be added to the revenue from television and from the website rtl.lu.

A serious suspicion

No matter how you look at it, and even if you have to question all the figures on which estimates have been made here, one thing is clear: RTL’s bill cannot add up at all. The advertising revenue mentioned in the table of the concession agreement only includes a part of all advertising revenue of RTL Luxembourg. So why are certain revenues not listed? Does RTL generate revenue outside of the parts that count as „public service“? But which parts are these and how are they separated from the other parts? The concession agreement does not provide for such a separation and in practice such a separation is not possible at all.

In any case, from the outside, everything indicates that RTL Luxembourg is not making a deficit overall - and that RTL Radio Luxembourg is by far the medium with the highest profit in the country. So does RTL really need the state funds to survive? Or is RTL making a bigger profit with the help of state funds? A profit that does not flow into the expansion of the program and into journalistic work, but into the billion-dollar Bertelsmann corporation? Christophe Goossens, Xavier Bettel, Tom Weidig, but also the officials in the Ministry of Media and the new Ministers of Media Luc Frieden and Elisabeth Margue, who have access to the hidden RTL figures, should know this.