Annual And Corporate Responsibility Report 2017

7.1. To shareholders 7.1.1. Share performance Because media groups tend to rely heavily on advertising revenue, their stock market performance has traditionally been pegged to economic growth, as this influences the investment decisions of advertisers. In 2017, a year in which growth projections have been systemically upgraded, we witnessed an unusual phenomenon: while household consumption increased, certain sectors actually lowered their advertising expenditure by nearly 10%. Although Spanish GDP growth was up 3.1% and the total advertising market gained 2.3% in 2017, the television market failed to make it past 1% growth. This difference is because certain industries, typically very active in the advertising markets, pared back their spending during the year. A prime example here is the mass consumption market, which accounts for nearly 30% of the total advertising market. Atresmedia’s share price gained 14% in early 2017, well above the 4% growth in advertising investment that would explain the correlation. Come April, however, investment dipped sharply by some 16%. This had a significant impact on the Company’s market performance in the second quarter, leading to a 14% correction in its share price. Since then, the advertising market has continued to fall, bringing with it the price of the Atresmedia’s share, which ended the year down 16.3%. The Company’s main competitor, Mediaset España, turned in a similar performance, with its share price sliding 16.1% to close out the year at 9.359 euros per share, a far cry from the gains reported by Spain’s blue-chip Ibex 35 stock index, which added 7.4% in the year. It was much the same story for other listed media companies operating in Europe (with the exception of French television broadcasters), bringing the average drop in share prices across the sector to 5.9%. 7. OUR CONTRIBUTION 7. OUR CONTRIBUTION  | 107 | ATRESMEDIA  |  ANNUAL AND CORPORATE RESPONSIBILITY REPORT 2017