SBS stock up on first day with AEX

Next year we should show net profit, CEO sez

By MARLENE EDMUNDS

AMSTERDAM -- Pan Euro station group SBS Broadcasting stock closed Wednesday at 31.20 euros ($44.60), 74¢ higher than its opening price on the Amsterdam Stock Exchange (AEX) as European investors reacted to the company's first day of trading in the city where its most successful station, SBS6, launched less than four years ago.

The stock opened at $32.85, the price it closed at Tuesday on the Nasdaq, where it has been listed since 1993.

In the first two hours alone, 60,000 SBS shares traded hands on the AEX, compared with an average daily volume of 40,000 shares on the Nasdaq.

A 'truly European company'

For SBS Broadcasting, the company's multiple listing and launch onto the AEX marked its coming of age as a "truly European company," SBS chairman and CEO Harry Evans Sloan told Daily Variety.

"Five years ago, European investors were not ready for us, and we were not ready for them," Sloan said.

"European investors want to see positive cash flow, whereas five years ago today we were experiencing negative cash flow because we were still very much in the development stage, incurring substantial losses while building for the future."

Now, Sloan added, "We not only have positive cash flow, but next year we should be in a position to report a net profit."

Americans hold shares

Although a majority of the board of directors of SBS are European, as well as most of its station managers, shareholders are largely American, "although, even as we speak, the shareholder register is swinging in the direction of Europe," Woody Knight, vice chairman and chief operating officer for SBS, told Daily Variety.

Analysts also saw the multiple listing in Amsterdam as "the logical next step" for the company. "The company has managed to build up credibility and to prove that they are not cowboys conquering the West but rather a bunch of entrepreneurs capable of starting in niche markets and by building up those markets, becoming serious players on the European landscape," said Henk Slotboom, head of European media research for Swiss private bank Julius Baer.

Currently, SBS has a network of channels in 10 territories, but SBS6 is the first of its stations to show a profit, so much so that it launched a second station just last March. Between SBS6 and its second channel, SBS has captured some 15% of the total aud share in the territory.