Bertelsmann AG, Europe's largest media company, will refrain from large acquisitions as it predicts profit will decline this year. The degree that profit and sales will drop this year will depend on
the "intensity and duration of the economic downturn," says CEO Hartmut Ostrowski. As a result, Bertelsmann, which competes with Vivendi and Time Warner, will refrain from "bigger acquisitions" or
divestitures.
Last year, net income fell 34% to $193 million, while adjusted sales were little changed. As a result, the company sold under-performing assets, such as club businesses,
while bolstering services and television.
In November Bertelsmann cut its earnings forecast for the second time in three months. To reduce costs in 2009, the management board members
will forgo their 2009 bonuses, which means a 50% pay cut for most of them.
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