Business Description

Bertelsmann SE & Co. KGaA, a multi-national mass media, and education company is located in Germany. Through its subsidiaries, the company is involved in broadcasting television, magazine publishing, e-learning, music rights, as well as services businesses. It is present in more than 50 countries, with the majority of its operations in Germany. The company has seven business segments, and other operations: Penguin Random House (RTL Group), Arvato, Gruner + Jahr; Bertelsmann Education Group; BMG; and Be Printers. RTL Group is one the most prominent European entertainment networks, with interests in 60 TV channels, 31 radio stations, and content production operations. Its television portfolio includes RTL Television in Germany, Belgium, Luxembourg, and Croatia, RTL Television in France, Antena 3, and Channels in Southeast Asia. It also operates the RTL CBS Asia Entertainment Network in Southeast Asia. RTL Group also owns a majority of SpotX, a leading platform for programmatic video advertising.

Arvato provides business process outsourcing (BPO), covering a variety of business processes through integrated service chains. These services include customer services, data management, supply chain management (SCM), customer relationship management (CRM), financial services, customized IT services, and all services related to the creation and distribution of printed products. Penguin Random House is a major trade book publisher. It owns nearly 250 brands and imprints on five continents. Each year, it publishes more than 15,000 titles and 800 million e-books. Penguin Random House publishes adult and children’s fiction, as well as nonfiction print editions. It also offers digital publishing. The company’s book brands include the storied imprints Doubleday and Alfred A.

Knopf in the US, Ebury, and Transworld in the UK, Plaza, and Janes in Spain, and Sudamericana in Argentina. Gruner + Jahr is a publishing and printing provider. It has over 500 digital magazines, and media activities and is represented in more than 20 countries. Gruner + Jahr publishes “Stern,” Brigitte,” Geo,” Geo,” Geo,” Capital,” Gala,” Eltern, and the titles of the P.M. group: “Essen & Trinken” (National Geographic).Publishing activities include magazine sales and marketing in the Netherlands, China, Spain, and China. Be Printers is an international printing company that has gravure and offset printing facilities in Germany, the UK (Prinovis), and the USA.

The Service Portfolio of Be printers includes digital communication services, as well as magazines, catalogs, brochures, and books. Bertelsmann Education Group provides digital education and services for healthcare and technology. Bertelsmann’s corporate investment business also includes strategic growth segments such as music and education, as well as club and direct marketing businesses that are being phased out. It also includes Bertelsmann Digital Media Investments, Bertelsmann Asia Investments(BAI), Bertelsmann India Investmentss (BII), Bertelsmann Brazil Investmentss (BBI), and other investments in growth regions.

Key Financials

Revenue (US$ Mn)

• Bertelsmann SE & Co.’s annual revenue for 2021 was US$ 18,790 Mn, a -11.52% decrease from 2020
• The annual revenue generated by Bertelsmann SE & Co. in 2020 was US$ 21,235 Mn
• At a -0.15% decrease, Bertelsmann SE & Co.’s annual revenue of US$ 20,183 Mn was indexed in 2019
• Bertelsmann SE & Co. generated total revenue of US$ 20,214 Mn in 2018

 

Operating Income (US$ Mn)

• Bertelsmann SE & Co.’s operating income for 2021 was US$ 3,257 Mn, a -15.64% decrease from 2020
• The operating income generated by Bertelsmann SE & Co. in 2020 was US$ 3,860 Mn
• At a 9.3% increase, Bertelsmann SE & Co.’s operating income of US$ 3,233 Mn was indexed in 2019
• Bertelsmann SE & Co. generated an operating income of US$ 2,958 Mn in 2018

 

Operating Margin %

• 17% was the operating margin generated by Bertelsmann SE & Co. in 2021
• Bertelsmann SE & Co.’s operating margin for 2020 was 18%, a 13.75% increase from 2019
• From 2018’s operating margins, Bertelsmann SE & Co. registered a 9.59% increase in 2019, amounting to 16%
• An operating margin of 15% was generated in 2018 by Bertelsmann SE & Co.

 

SWOT Analysis

Strengths

Revenue growth enables the company to pursue expansion plans

Bertelsmann saw steady revenue growth in the last year. The company’s revenue for FY2019 was EUR18,023 million, a 2% increase over FY2018. Strong performance by the RTL Group and Arvato segments was responsible for the company’s revenue growth. RTL Group revenue increased by 2.2% thanks to content business growth and digital businesses.

Acquisitions accounted for 1.9% of the Arvato segment’s growth. Due to the increase in revenue from SCM and Financial Solutions, the healthcare segment’s revenue increased by 1.8%. Investor confidence is increased and the company can pursue expansion plans.