In 2016, Bertelsmann posted a positive operating performance. The Group achieved organic revenue growth, record operating earnings despite start-up losses for digital and new businesses, and once again a high Group profit. In addition, Bertelsmann made further progress in line with all of the strategic priorities. Consequently, Bertelsmann is increasingly becoming a fastergrowing, more digital, more international and more diversified Group.

In the reporting period, Group revenues of €17.0 billion were 1.1 percent below the previous year’s figure of €17.1 billion and thus fell short of expectations (outlook in 2015 Annual Report: slight increase in revenues). The revenue decline is due to exchange rate and portfolio effects. By contrast, organic growth was 0.9 percent. Operating EBITDA of €2,568 million (previous year: €2,485 million) recorded a positive deviation from outlook, which despite planned start-up losses for new and digital businesses was moderately above the previous year (outlook in 2015 Annual Report: stable operating EBTIDA). At €147 million, the BVA used for Group management was considerably below the previous year’s figure of €155 million (outlook in 2015 Annual Report: strongly declining BVA). The expected development reflects the increase in the average level of capital invested, which is primarily due to acquisitions; the deviation from outlook reflects the better operating earnings performance in the reporting period.

Bertelsmann’s four strategic priorities – strengthening the core businesses, driving the digital transformation forward, developing growth platforms and expanding into growth regions – continued to be the focus of Group development in the financial year 2016. As well as the formation of the Ad Alliance as a cooperation in advertising marketing between Mediengruppe RTL Deutschland and Gruner + Jahr and the foundation of Deutsche Medien-Manufaktur by Gruner + Jahr in conjunction with Landwirtschaftsverlag, the recently implemented management structure at Bertelsmann Printing Group and the Group-wide earnings improvement program helped to strengthen the core businesses. As part of the digital transformation, RTL Group, among other things, took over the online video marketer Smartclip, Gruner + Jahr took over the digital video provider Groupe Cerise and Arvato generated growth through services for companies in the IT/high-tech sector and with e-commerce services. The growth platforms were further strengthened through organic and acquisitive expansion, particularly in the music and education segments. As part of expanding the presence in the growth regions, Bertelsmann Investments made other new and follow-up investments and made a positive contribution to Group profit through gains from disposals of investments.

The net assets and financial position remained solid over the last financial year. The maturity profile of the capital market financings was further optimized through the issues made in the financial year 2016. As of December 31, 2016, the cash and cash equivalents reported at €1.4 billion (previous year: €1.3 billion) represent sufficient liquidity. The ratings agencies Moody’s and S&P continued to rate Bertelsmann as “Baa1” and “BBB+,” respectively, with a stable outlook. Overall, Bertelsmann ended the financial year 2016 with a successful performance and has a solid financial basis.