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United States : Media and entertainment industry poised to generate one of the best profit margins in 2015 compared to leading stock market indices.

The media and entertainment (M&E) industry is expected to generate higher margins than several leading stock market indices, according to an EY report. Spotlight on profitable growth: Media & Entertainment Vol. VIII provides a performance comparison of the overall M&E business to major stock market indices as well as a ranking of 11 M&E industry sectors on both their profitability and profitability growth rate.

M&E industry earnings before interest, taxes, depreciation and amortization (EBITDA) have increased every year during the period 2011 to 2014 and are expected to remain constant in 2015 as companies continue to leverage digital media, deliver new consumer experiences and expand into emerging markets.

John Nendick, EY s Global Media & Entertainment Leader, says: The evolution of the M&E industry continues to focus on the exploitation of digital distribution and finding new and innovative ways to reach and interact with the consumer. With surging demand for content, M&E companies are growing their profitability through multiple consumer offerings, better knowledge of consumer tastes and preferences and continued international expansion.

In 2015, it is estimated the M&E industry will outperform several major cross-industry stock market indices. The 11 sectors of the M&E industry measured by EY are expected to have a 2015 estimated profit margin of 28.3%, second only to the Hang Seng Index, 34.3%; followed by the FTSE Index, 27.9%; the S&P 500 Index, 27.8%; the Sensex, 27.0%; the CAC 40 Index, 19.5%; the DAX 30 Index, 17.9%; and the Nikkei Index, 14.4%.

Looking at the 2011-2015e compound annual growth rate in terms of EBITDA dollars, the M&E industry is the third fastest-growing industry as compared to leading stock market indices at 7%, behind the S&P 500 Index at 10% and the Hang Seng Index at 8%; and ahead of the FTSE 100 Index, 6%; the DAX 30 Index, 4%; the Nikkei Index, 4%; the Sensex, 3%; and the CAC 40 Index, 0%.

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Publication:Mena Report
Date:Oct 16, 2015
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