Overall Economic Developments

The expansion of the global economy noticeably accelerated in 2017. Real GDP increased by 3.8 percent compared to 3.1 percent in 2016. Global economic growth was more broadly based and global trading increased significantly once more.

The economic upturn in the eurozone remains solid. Real GDP grew by 2.5 percent in 2017 compared to 1.7 percent in the previous year. The growth was supported by the increase in private consumer spending and investments and by exports that benefited from increasing global trading.

The German economy is seeing a strong upturn. Real GDP grew by 2.2 percent compared to 1.9 percent in the previous year. In France too, the economic situation showed steady improvement. Real GDP growth was 1.9 percent in 2017 compared to 1.1 percent in 2016. In the United Kingdom, economic activity slowed as a result of Brexit with an increase in real GDP of 1.7 percent, compared to a rise of 1.9 percent in the previous year.

The US economy proved to be robust, backed by solid domestic demand. Real GDP grew by 2.3 percent in 2017 compared to 1.9 percent in 2016.

Developments in Relevant Markets

The following analysis focuses on markets and regions that are of a sufficient size and that are strategically important from a Group perspective.

The majority of the European TV advertising markets saw stable or declining development in 2017. While the development of the TV advertising markets in Germany, France and Spain was largely stable, the TV advertising markets in the Netherlands, Belgium, Hungary and Croatia saw a moderate to significant decline.

The markets for printed books achieved slightly positive growth overall in 2017. Sales of printed books in the United States and sales in Spain grew slightly, while sales of printed books were stable in the United Kingdom and fell slightly in Germany. Publishing sales of e-books in the United States and the United Kingdom continued to decline, although sales of audio downloads recorded strong growth.

The magazine markets in Germany and France in 2017 were characterized by strongly declining print advertising business and significantly declining circulation business, while the digital business posted strong growth.

The global music markets in 2017 reported moderate growth in the publishing rights market segment. The recording rights market segment grew significantly.

The key service markets for Arvato, namely Customer Relationship Management, Supply Chain Management, Financial Solutions and IT, saw moderate to significant growth.

The European offset printing markets showed stable development in 2017, while the European gravure printing markets declined significantly. The development of the North American book printing market was stable over the same period.

The education markets in the United States continued to grow strongly overall in 2017 in the market segments where Bertelsmann is involved – namely, healthcare and technology, university education and online services.