Storytel exceeds forecast for Q2 2019

Storytel had 887,500 paying subscribers on average in Q2 2019, which is an increase of 53,200 customers compared to Q1 2019. Storytel therefore surpasses the forecast of 880,000 paying subscribers and further solidifies its position as a market leader for subscribed digital services for audiobooks and e-books in the Nordic region and northern Europe. Streaming revenue for Q2 2019 was 320 MSEK, compared to the forecast of 313 MSEK. Annual revenue growth is therefore 37%.

The average number of paying subscribers in Q2 2019 in the Nordic region amounted to 669,200, which corresponds to 9,200 paying subscribers more than the forecast. Customer intake for the service on the Nordic markets has been strong, and Storytel’s Family subscription, which was launched at the end of 2018, has also exceeded expectations.  Streaming revenue in the Nordic markets was 276 MSEK, compared to a forecast of 270 MSEK. ARPU is rising because the Family subscription price level is now normal compared to the first quarter, when it was offered at a reduced price. Annual subscriber growth in the Nordic region amounted to 26%.

“We have seen strong growth in number of subscribers during the quarter – not least in the Nordic market – and our new Family subscription has been well received. Starting in July, VAT on digital books will be reduced in Sweden, Norway and Finland, which presents opportunities for us to further develop our customer offering and at the same time, thanks to our revenue-share model with the publishers, improve earnings for authors,” says Storytel CEO Jonas Tellander.

There were 218,300 subscribers in the Non-Nordic segment on average in Q2 2019, which corresponds to an increase of around 30,000 paying subscribers compared to Q1 2019 and is very close to the previously published forecast of 220,000. Annual subscriber growth amounted to 140%. In the Non-Nordic segment, streaming revenue amounted to approximately 44 MSEK in Q2 2019, which is in line with the forecast.

During the quarter, Storytel launched in Germany, its 17th market, and announced plans to launch in Brazil and South Korea in 2019. In Sweden, the Ztory app was introduced on 14 June as part of Storytel’s strong customer offering and adds access to digital subscriptions to more than 700 popular newspapers and magazines.

“We are pleased and humbled by the strong growth in subscriptions, at the same time as the Storytel universe of reading and listening experiences is expanding. By exceeding the forecast for the period, Storytel is entering into the third quarter with both strength and speed, a quarter that from a business perspective is the strongest period of the year for our industry,” says Jonas Tellander.

Key performance indicators  for Storytel Streaming 

Currency: thousand SEK    Q1 2018    Q2 2018    Q3 2018    Q4 2018    Q1 2019    Q2 2019    Q2 2019
Streaming Total  Forecast Actual
Revenue 222,133 239,139 279,979 291,315 295,994 313,000 320,034
Contribution Profit1 24,079 25,045 22,063 30,444 31,372
Contribution Margin 10.8% 10.5% 7.9% 10.5% 10.6%
Paying Subscribers 577,900 621,200 720,900 768,700 834,300 880,000 887,500
ARPU2 (SEK/Month) 128 128 129 126 118 119 120
Streaming Nordic3
Revenue 205,987 218,714 253,081 259,256 258,288 270,000 276,347
Contribution Profit 56,584 57,986 62,327 82,645 75,329
Contribution Margin 27.5% 26.5% 24.6% 31.9% 29.2%
Paying Subscribers 503,200 530,200 595,400 616,300 645,500 660,000 669,200
ARPU (SEK/Month) 136 138 142 140 133 136 138
 
Streaming Non-Nordic
Revenue 16,146 20,424 26,898 32,059 37,706 43,000 43,687
Contribution Profit -32,505 -32,941 -40,264 -52,200 -43,957
Contribution Margin -201.3% -161.3% -149.7% -162.8% -116.6%
Paying Subscribers 74,700 91,000 125,500 152,400 188,800 220,000 218,300
ARPU (SEK/Month) 72 75 71 70 67 65 67

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1 Contribution Profit is defined as streaming revenue minus costs for content (licensed content and in-house productions) and marketing. Storytel Reader is not included in Streaming.

2 ARPU = Average Revenue Per User (Subscriber) per month. In Q1 2019, Storytel released Family subscription and a discounted campaign has been run, lowering the ARPU. The lowering ARPU is also explained by Q1 having fewer days (90)  and growth in low priced markets.

3 Storytel Norway included in figures @ 100%. In the consolidated group accounts Norway is reported according to the principle of proportional consolidation.

For more information please contact:

Dan Panas, Head of Communications, Storytel: +46,701,865,290

FNCA Sweden AB is the company’s certified adviser. FNCA can be reached at info@fnca.se and +46 8 528 00 399.

 

This information is such that Storytel AB (publ) is obliged to disclose in accordance with the EU Market Abuse Regulation. The information was provided, through the agency of the above contact person, at the time stated in this press release.

 

About Storytel

Storytel is Northern Europe’s leading audiobook and e-book streaming service and offers unlimited listening and reading of more than 200 000 titles on a global scale. Our vision is to make the world a more empathetic place with great stories to be shared and enjoyed by anyone, anywhere and anytime. Storytel is a digital platform provider as well as a comprehensive publishing group. The streaming business area offers subscriptions for audiobooks and e-books under the Storytel and Mofibo brands. Storytel’s publishing business area is carried out through the publishing houses Norstedts, Massolit, StorySide, Printz Publishing, People’s Press, Rabén & Sjögren, B.Wahlströms and Norstedts Kartor. Ztory – a subscribed digital read-all-you-can streaming service for newspapers and magazines, is part of Storytel since January 2019. Storytel operates in 16 markets around the globe and is headquartered in Stockholm, Sweden.