2. Principal Activities and Segmental Information

(a) Principal activities

RTÉ is a not-for-profit organisation. Its principal public-service activity is the broadcast of a comprehensive range of free-to-air television and radio channels, and online services. Further opportunities to access RTÉ’s public-service content are provided via the RTÉ One+1, RTÉ2+1 and RTÉjr channels. These services serve all demographic categories in Irish society with a wide variety of output and genres, irrespective of commercial audience attraction, and with specific emphasis on indigenously produced programmes. RTÉ’s other public-service activities include RTÉ Orchestra.

The cost of RTÉ’s public-service activities is substantially in excess of the amount of public funding received in the form of licence fee revenue. Accordingly, RTÉ also engages in ancillary commercial activities to support its public-service activities. These include the sale of advertising and sponsorship, publication of the RTÉ Guide and other broadcast-related commercial activities.

As required by legislation, RTÉ provides digital terrestrial television (DTT) multiplexing services which it makes available to national broadcasters, including RTÉ’s own services, in accordance with published regulated market tariffs. The management of this multiplexing service is separated within RTÉ from the management of the broadcast divisions. RTÉ Transmission Network DAC (trading as 2rn), a subsidiary of RTÉ, supplies transmission and distribution services to multiplex operators (including RTÉ) and national and quasi-national sound broadcasters, including RTÉ. 2rn also makes the transmission network available to local broadcasters and rents surplus tower/mast space to a variety of third-party non-broadcast users.

RTÉ is structured under the following divisions: Commercial, Content, News & Current Affairs, Audience, Channels and Marketing, Network; and support divisions Operations & Production Services, Technology & Transformation, Human Resources and Finance. Network division, entirely located within 2rn, managed the transmission, distribution and related activities as described above. RTÉ’s Commercial division manages all commercial activities other than: those carried on by 2rn, the provision of multiplexing services (see above) and sales of archive and library services managed by the Content division. The Commercial division was established further to the publication of RTÉ’s updated Fair Trading Policy and Procedures to more clearly demonstrate the separation of RTÉ’s public-service and commercial activities. For each division, the Director-General and the RTÉ Executive review internal management reports on a monthly basis. A detailed list of RTÉ’s activities by division and legal entity is set out in note 18 to these financial statements.

In addition to the divisions, RTÉ operates Corporate HQ and Corporate division. Corporate HQ consists of general administrative and other activities that arise at the entity level relating to the governance of RTÉ as a public-service broadcaster. The Corporate division includes activities that are carried out centrally on behalf of the divisions, the cost of which is allocated in accordance with the cost allocation principles set out in note 1(c). The cost of the Corporate HQ is not allocated to divisions and is reported in All Other Segments.

(b) Segmental information and other analysis

Broadcast and transmission services including multiplex services are charged to the Audience, Channels and Marketing division on the basis of published tariffs. 2rn invoices RTÉ at the published regulated tariff for supply of transmission and distribution services as a multiplex operator and as a sound broadcaster. Costs incurred in support of RTÉ’s television and radio channels are charged to those channels on the basis of the published regulated tariffs. Other elements of the tariff are reported as a reconciling item between the cost of reportable segments and the total cost. Other 2rn services are invoiced at appropriate market rates.

Transactions between activities in pursuit of RTÉ’s public-service objects and activities to exploit commercial opportunities are effected at market rates.

The segmental information in note 2(d) presents information for the divisions above. Other segmental analysis as required by the Broadcasting Act 2009 is set out in note 2(e).

Note 2(e) provides an analysis of gross/net cost of public-service activities and (deficit)/surplus by channel and service. In addition, gross costs of indigenous content by broadcasting genre are also provided. The analysis between public-service and non-public-service activities is reported in a manner that is consistent with the principles used to report revenues and costs set out above.

Audience, Channels and Marketing, Content and News & Current Affairs division costs are fully allocated to the relevant television and radio channels and online services in accordance with the cost allocation principles outlined in note 1(c). Other supporting division costs are allocated to the divisions they support using appropriate cost accounting principles.

The residual non-channel and non-service activities are aggregated together under the category “Other” and include 2rn, provision of multiplexing services, RTÉ Guide and non-channel activities.

(c) Licence fee attribution

Each RTÉ service has a detailed service description which clearly defines how the channel or service contributes to the delivery of RTÉ’s public-service objects.

In line with common practice among public-service media organisations (PSMs) across the EU, RTÉ attributes public funding to individual services based on the net cost of the public service. Net cost of public service is the gross cost of delivering the public service after deducting the contribution from commercial activities.

The gross public-service cost of each of RTÉ’s channels and services includes all costs incurred in the production and delivery of the service. It does not include any costs incurred in the exploitation of commercial opportunities arising from the provision of the service. These costs are allocated against the commercial revenue to which they relate, to calculate the commercial contribution. Surpluses on commercial activities not directly linked to channels or services are attributed to those public-service activities which have significant revenue-generating potential (RTÉ One, RTÉ2, RTÉ Radio 1, RTÉ 2fm, online services) in proportion to the gross cost of public services.

Licence fee revenue is firstly attributed to those public-service channels and services that have a limited capacity to generate commercial revenue in their own right and therefore are, of necessity, primarily funded by licence fee revenue in order to facilitate continued delivery of the public service. The services at issue comprise RTÉ Orchestra, RTÉ Raidió na Gaeltachta, RTÉ lyric fm, statutory provision of programming to TG4, supplementary DTT and digital audio broadcast (DAB) channels (“other channels”), Corporate HQ and financing costs.

The remaining licence fee is attributed between services with significant commercial revenue potential in proportion to the net cost of the public services. These services include: RTÉ One, RTÉ2, RTÉ Radio 1, RTÉ 2fm and online services. No licence fee revenue is attributed to 2rn, the provision of multiplexing services by RTÉ or any costs incurred in the exploitation of commercial opportunities.

(d) Revenues, costs and surplus/(deficit) by Division (continuing operations), in line with RTÉ’s organisation structure, year ended 31 December 2022

	REPORTABLE SEGMENTS					OTHER
			News &
			Current			All
	Commercial	Content	Affairs	ACM	Network	Other	Consolidation	Group
	Division	Division	Division	Division	Division	Segments	Adjustments*	Total
	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000
Revenue
Advertising income	109,571	-	-	-	-	-	(510)	109,061
Sponsorship income	11,370	-	-	-	-	-	-	11,370
Facilities income	2,588	-	-	-	-	23	(175)	2,436
Circulation and event income	4,067	-	-	-	-	-	-	4,067
Transmission, mast and towers income	-	-	-	-	25,747	-	(15,225)	10,522
Content, merchandising and related sales	9,811	508	-	-	-	-	-	10,319
Other commercial revenue	511	-	-	-	-	3,807	(40)	4,278
Commercial revenue	137,918	508	-	-	25,747	3,830	(15,950)	152,053
Licence fee revenue attribution	-	118,814	36,204	36,799	-	3,825	-	195,642
	137,918	119,322	36,204	36,799	25,747	7,655	(15,950)	347,695
Costs by output category**
Programme and output costs - by source
In-house productions	-	(132,186)	(55,455)	(366)	-	-	-	(188,007)
Commissioned programming	-	(44,680)	(55)	(1,500)	-	-	-	(46,235)
Indigenous programming	-	(176,866)	(55,510)	(1,866)	-	-	-	(234,242)
Acquired programmes - Ireland	-	(4,063)	-	(340)	-	-	-	(4,403)
Acquired programmes - Overseas	-	(19,183)	-	(1,949)	-	-	-	(21,132)
	-	(200,112)	(55,510)	(4,155)	-	-	-	(259,777)
General broadcast, transmission & other output costs	(10,159)	(3,501)	-	(45,582)	(18,387)	(205)	634	(77,200)
2rn transmission and power charges	-	-	-	(11,490)	-	(3,735)	15,225	-
Sales costs	(9,591)	-	-	-	-	-	252	(9,339)
	(19,750)	(203,613)	(55,510)	(61,227)	(18,387)	(3,940)	16,111	(346,316)
Unallocated revenues and costs
Corporate HQ	-	-	-	-	-	(4,434)	-	(4,434)
DTT related	-	-	-	-	-	(680)	392	(288)
Interest payable	-	-	-	-	(915)	(404)	7	(1,312)
Disposal of assets	-	-	12	-	(1)	1	-	12
Divisional Surplus/(Deficit)	118,168	(84,291)	(19,294)	(24,428)	6,444	(1,802)	560	(4,643)
Net defined benefit pension related finance income	-	-	-	-	-	1,653	-	1,653
Surplus/(Deficit) before income tax	118,168	(84,291)	(19,294)	(24,428)	6,444	(149)	560	(2,990)
Income tax								197
Deficit for the year								(2,793)

* Elimination of intra-group revenue and costs at arm’s length.

** Costs by output category include applicable depreciation, amortisation, net finance (expense)/income and exclude operating costs of Corporate HQ.

Additional Segmental Disclosures

Commercial revenue of:
External customers	137,233	508	-	-	10,522	3,790	-	152,053
Revenue from other operating segments	685	-	-	-	15,225	40	(15,950)	-
	137,918	508	-	-	25,747	3,830	(15,950)	152,053

One customer of all the reporting segments represents €198.2 million of the Group’s total revenue.

Material non-cash items included in the reportable segment costs include:

Depreciation and amortisation	315	2,890	1,791	1,865	5,430	66	(592)	11,765
Difference between pension charge and cash contributions	94	924	458	247	33	21	-	1,777

(d) Revenues, costs and surplus/(deficit) by Division (continuing operations), in line with RTÉ’s organisation structure, year ended 31 December 2021

	REPORTABLE SEGMENTS					OTHER
			News &
			Current			All
	Commercial	Content	Affairs	ACM	Network	Other	Consolidation	Group
	Division	Division	Division	Division	Division	Segments	Adjustments*	Total
	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000
Revenue
Advertising income	109,827	-	-	-	-	-	(293)	109,534
Sponsorship income	10,966	-	-	5	-	-	-	10,971
Facilities income	2,351	-	-	-	-	25	(102)	2,274
Circulation and event income	3,369	-	-	-	-	-	-	3,369
Transmission, mast and towers income	-	-	-	-	25,865	-	(16,095)	9,770
Content, merchandising and related sales	8,170	489	-	-	-	-	-	8,659
Other commercial revenue	87	-	-	-	-	3,718	(40)	3,765
Commercial revenue	134,770	489	-	5	25,865	3,743	(16,530)	148,342
Licence fee revenue attribution	-	120,727	34,869	36,956	-	3,579	-	196,131
	134,770	121,216	34,869	36,961	25,865	7,322	(16,530)	344,473
Costs by output category**
Programme and output costs - by source
In-house productions	-	(133,125)	(53,716)	(963)	-	-	-	(187,804)
Commissioned programming	-	(43,533)	(56)	(757)	-	-	-	(44,346)
Indigenous programming	-	(176,658)	(53,772)	(1,720)	-	-	-	(232,150)
Acquired programmes - Ireland	-	(3,666)	-	(73)	-	-	-	(3,739)
Acquired programmes - Overseas	-	(18,230)	-	(2,172)	-	-	-	(20,402)
	-	(198,554)	(53,772)	(3,965)	-	-	-	(256,291)
General broadcast, transmission & other output costs	(7,388)	(3,546)	-	(44,008)	(18,487)	(341)	557	(73,213)
2rn transmission and power charges	-	-	-	(13,558)	-	(2,538)	16,096	-
Sales costs	(8,290)	-	-	-	-	-	183	(8,107)
	(15,678)	(202,100)	(53,772)	(61,531)	(18,487)	(2,879)	16,836	(337,611)
Other revenues and costs
Corporate HQ	-	-	-	-	-	(3,888)	-	(3,888)
DTT Related	-	-	-	-	-	(478)	200	(278)
Interest payable	-	-	-	-	(759)	(650)	8	(1,401)
Disposal of assets	-	-	10	9	51	4	-	74
Divisional Surplus/(Deficit)	119,092	(80,884)	(18,893)	(24,561)	6,670	(569)	514	1,369
Net defined benefit pension related finance income	-	-	-	-	-	1,397	-	1,397
Surplus/(Deficit) before income tax	119,092	(80,884)	(18,893)	(24,561)	6,670	828	514	2,766
Income tax								(407)
Surplus for the year								2,359

* Elimination of intra-group revenue and costs at arm’s length.

** Costs by output category include applicable depreciation, amortisation, net finance (expense)/income and exclude operating costs of Corporate HQ.

Additional Segmental Disclosures

Commercial revenue of:
External customers	134,375	489	-	5	9,770	3,703	-	148,342
Revenue from other operating segments	395	-	-	-	16,095	40	(16,530)	-
	134,770	489	-	5	25,865	3,743	(16,530)	148,342

One customer of all the reporting segments represents €198 million of the Group’s total revenue.

Material non-cash items included in the reportable segment costs include:

Depreciation and amortisation	261	2,680	1,702	1,312	6,208	38	(547)	11,654
Difference between pension charge and cash contributions	58	564	261	145	33	11	-	1,072

(e) Analysis of revenues, costs and surplus/(deficit) by channel, service and broadcasting genre and between public-service and non-public-service activities,
year ended 31 December 2022

			RTÉ	RTÉ	RTÉ	RTÉ	TG4	RTÉ	Corporate	DTT	Online	Other		Consolidation	Group
	RTÉ One	RTÉ2	Radio 1	2fm	lyric fm	RnaG	Support	Orchestras	HQ	Related	Services	Channels	Other	Adjustments	Total
	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000
PUBLIC-SERVICE ACTIVITIES
Indigenous programme costs
In-house productions	(75,081)	(42,399)	(26,526)	(5,441)	(3,636)	(9,889)	(5,779)	(6,745)	-	-	(11,774)	(737)	-	-	(188,007)
Commissioned programming	(29,756)	(10,490)	(1,058)	(78)	(148)	(117)	(1,591)	-	-	-	(1,566)	(1,431)	-	-	(46,235)
	(104,837)	(52,889)	(27,584)	(5,519)	(3,784)	(10,006)	(7,370)	(6,745)	-	-	(13,340)	(2,168)	-	-	(234,242)
Programme costs - by genre
Arts	(1,409)	-	(1,809)	-	(175)	(86)	-	-	-	-	-	-	-	-	(3,479)
Religious	(2,464)	-	(239)	-	-	(140)	-	-	-	-	-	-	-	-	(2,843)
Other factual	(28,582)	(4,047)	(2,943)	-	(137)	(1,338)	(184)	-	-	-	(1,519)	-	-	-	(38,750)
Factual	(32,455)	(4,047)	(4,991)	-	(312)	(1,564)	(184)	-	-	-	(1,519)	-	-	-	(45,072)
Drama	(16,301)	(727)	(570)	-	-	(2)	(360)	-	-	-	(62)	-	-	-	(18,022)
Entertainment	(20,741)	(949)	(3,025)	(2,974)	(402)	(515)	(13)	-	-	-	(1,284)	-	-	-	(29,903)
Music	(762)	(380)	(1,604)	(1,547)	(2,674)	(1,733)	-	(6,745)	-	-	-	(737)	-	-	(16,182)
News, Current Affairs and Weather	(33,651)	(14)	(14,968)	(587)	(367)	(4,842)	(5,241)	-	-	-	(8,681)	-	-	-	(68,351)
Sport	(927)	(43,437)	(2,426)	(411)	-	(1,146)	(1,537)	-	-	-	(1,686)	-	-	-	(51,570)
Young People’s	-	(3,335)	-	-	(29)	(204)	(35)	-	-	-	(108)	(1,431)	-	-	(5,142)
Indigenous programming	(104,837)	(52,889)	(27,584)	(5,519)	(3,784)	(10,006)	(7,370)	(6,745)	-	-	(13,340)	(2,168)	-	-	(234,242)
Acquired programmes
- Ireland	(3,716)	(309)	-	-	-	-	-	-	-	-	(340)	(38)	-	-	(4,403)
- Overseas	(12,274)	(6,570)	-	-	-	-	-	-	-	-	(1,949)	(339)	-	-	(21,132)
General broadcast, transmission and other output costs	(13,025)	(9,210)	(5,987)	(4,638)	(660)	(554)	(14)	(96)	(4,434)	(680)	(10,380)	(785)	(3,146)	434	(53,175)
2rn transmission and power charges	(1,600)	(1,615)	(1,888)	(1,057)	(1,066)	(1,057)	-	-	-	-	-	(3,207)	-	-	(11,490)
Net interest payable	-	-	-	-	-	-	-	-	(404)	-	-	-	-	-	(404)
Net defined benefit pension related finance income	-	-	-	-	-	-	-	-	1,653	-	-	-	-	-	1,653
Gross Cost of Public Service Activities	(135,452)	(70,593)	(35,459)	(11,214)	(5,510)	(11,617)	(7,384)	(6,841)	(3,185)	(680)	(26,009)	(6,537)	(3,146)	434	(323,193)
Surplus on Commercial Activities	58,554	23,308	14,779	7,036	585	-	-	1,415	40	-	7,606	-	11,112	126	124,561
Distribution of Non-Channel Specific Contribution from Non-Public-Service Activities	5,400	2,814	1,414	447	-	-	-	-	-	-	1,037	-	(11,112)	-	-
Net Cost of Public-Service Activities Before Attribution of Public Funding	(71,498)	(44,471)	(19,266)	(3,731)	(4,925)	(11,617)	(7,384)	(5,426)	(3,145)	(680)	(17,366)	(6,537)	(3,146)	560	(198,632)
Public Funding
Licence fee revenue attribution	69,874	43,461	18,829	3,646	4,925	11,617	7,384	5,426	3,145	680	16,972	6,537	3,146	-	195,642
Deficit before income tax	(1,624)	(1,010)	(437)	(85)	-	-	-	-	-	-	(394)	-	-	560	(2,990)
Income tax	-	-	-	-	-	-	-	-	-	-	-	-	197	-	197
(Deficit)/Surplus for the year	(1,624)	(1,010)	(437)	(85)	-	-	-	-	-	-	(394)	-	197	560	(2,793)

External commercial revenue includes €1.5 million from sales outside of the Republic of Ireland, primarily generated in the UK. Total non-current assets contain €0.4 million situated outside of the Republic of Ireland in 2022 (2021: €0.4 million).

(e) Analysis of revenues, costs and surplus/(deficit) by channel, service and broadcasting genre and between public-service and non-public-service activities,
year ended 31 December 2021

			RTÉ	RTÉ	RTÉ	RTÉ	TG4	RTÉ	Corporate	DTT	Online	Other		Consolidation	Group
	RTÉ One	RTÉ2	Radio 1	2fm	lyric fm	RnaG	Support	Orchestras	HQ	Related	Services	Channels	Other	Adjustments	Total
	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000	€’000
PUBLIC-SERVICE ACTIVITIES
Indigenous programme costs
In-house productions	(71,257)	(40,652)	(26,315)	(5,142)	(3,460)	(9,609)	(5,733)	(12,760)	-	-	(11,988)	(888)	-	-	(187,804)
Commissioned programming	(27,684)	(11,487)	(978)	(37)	(148)	(150)	(1,732)	-	-	-	(732)	(1,398)	-	-	(44,346)
	(98,941)	(52,139)	(27,293)	(5,179)	(3,608)	(9,759)	(7,465)	(12,760)	-	-	(12,720)	(2,286)	-	-	(232,150)
Programme costs - by genre
Arts	(1,521)	-	(1,676)	-	(201)	(38)	-	-	-	-	-	-	-	-	(3,436)
Religious	(2,344)	-	(190)	-	-	(134)	-	-	-	-	-	-	-	-	(2,668)
Other factual	(24,586)	(6,512)	(3,078)	-	(129)	(1,352)	(182)	-	-	-	(627)	-	-	-	(36,466)
Factual	(28,451)	(6,512)	(4,944)	-	(330)	(1,524)	(182)	-	-	-	(627)	-	-	-	(42,570)
Drama	(19,598)	(337)	(665)	-	-	(10)	(360)	-	-	-	-	-	-	-	(20,970)
Entertainment	(16,008)	(607)	(2,704)	(2,684)	(375)	(502)	(949)	-	-	-	(2,177)	-	-	-	(26,006)
Music	(755)	(374)	(1,498)	(1,444)	(2,506)	(1,705)	(140)	(12,760)	-	-	-	(888)	-	-	(22,070)
News, Current Affairs and Weather	(32,330)	(35)	(14,451)	(598)	(373)	(4,709)	(5,209)	-	-	-	(8,295)	-	-	-	(66,000)
Sport	(1,799)	(40,819)	(3,031)	(453)	-	(1,107)	(598)	-	-	-	(1,494)	-	-	-	(49,301)
Young People’s	-	(3,455)	-	-	(24)	(202)	(27)	-	-	-	(127)	(1,398)	-	-	(5,233)
Indigenous programming	(98,941)	(52,139)	(27,293)	(5,179)	(3,608)	(9,759)	(7,465)	(12,760)	-	-	(12,720)	(2,286)	-	-	(232,150)
Acquired programmes
- Ireland	(3,299)	(305)	-	-	-	-	-	-	-	-	(73)	(62)	-	-	(3,739)
- Overseas	(11,286)	(6,572)	-	-	-	-	-	-	-	-	(2,172)	(372)	-	-	(20,402)
General broadcast, transmission and other output costs	(13,963)	(8,911)	(5,879)	(3,962)	(586)	(535)	(14)	(135)	(3,888)	(478)	(8,995)	(931)	(3,129)	211	(51,195)
2rn transmission and power charges	(2,031)	(2,026)	(2,368)	(1,042)	(1,052)	(1,042)	-	-	-	-	-	(3,997)	-	-	(13,558)
Net interest payable	-	-	-	-	-	-	-	-	(650)	-	-	-	-	-	(650)
Net defined benefit pension related finance income	-	-	-	-	-	-	-	-	1,397	-	-	-	-	-	1,397
Gross Cost of Public-Service Activities	(129,520)	(69,953)	(35,540)	(10,183)	(5,246)	(11,336)	(7,479)	(12,895)	(3,141)	(478)	(23,960)	(7,648)	(3,129)	211	(320,297)
Surplus on Commercial Activities	60,627	22,313	15,690	6,206	553	-	-	143	40	-	7,346	-	13,711	303	126,932
Distribution of Non-Channel Specific Contribution from Non-Public-Service Activities	6,598	3,563	1,810	519	-	-	-	-	-	-	1,221	-	(13,711)	-	-
Net Cost of Public-Service Activities Before Attribution of Public Funding	(62,295)	(44,077)	(18,040)	(3,458)	(4,693)	(11,336)	(7,479)	(12,752)	(3,101)	(478)	(15,393)	(7,648)	(3,129)	514	(193,365)
Public Funding
Licence fee revenue attribution	63,274	44,771	18,323	3,512	4,693	11,336	7,479	12,752	3,101	478	15,635	7,648	3,129	-	196,131
Surplus before income tax	979	694	283	54	-	-	-	-	-	-	242	-	-	514	2,766
Income tax	-	-	-	-	-	-	-	-	-	-	-	-	(407)	-	(407)
(Deficit)/Surplus for the year	979	694	283	54	-	-	-	-	-	-	242	-	(407)	514	2,359

External commercial revenue includes €1.5 million from sales outside of the Republic of Ireland, primarily generated in the UK. Total non-current assets contain €0.4 million situated outside of the Republic of Ireland in 2021 (2020: €0.5million).

(f) Analysis of network charges to all RTÉ services

	2022	2021
	€’000	€’000
RTÉ One	1,600	2,031
RTÉ2	1,615	2,026
RTÉ Radio 1	1,888	2,368
RTÉ 2fm	1,057	1,042
RTÉ lyric fm	1,066	1,052
RTÉ Raidió na Gaeltachta	1,057	1,042
Other	3,207	3,997
	11,490	13,558