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New Southern Cross CEO Grant Blackley says ‘improvements needed’ in some areas

SCAIncoming CEO of Southern Cross Austereo Grant Blackley and chairman Peter Bush have signalled that its troubled Sydney radio station 2Day Hit 104.1FM is their “number one challenge”.

The comments were made in an interview with Mumbrella following yesterday’s announcement of the appointment of the former CEO of Network Ten as the replacement to former CEO Rhys Holleran.

“Our number one challenge is to recover in one station in Sydney,” said Bush, referring to 2Day. “We dominate in Melbourne and everybody seems to forget the broader performance of the business – regional radio is very strong and it is very early days for (Hit Network) to build share and loyalty.”

Southern Cross Austereo has seen a turbulent 18 months in which profits tumbled last year after its previously top-rated radio station 2Day crashed to the bottom of the ratings following the loss of Kyle Sandilands and Jackie Henderson to rivals KiisFM.

Bush said he believed that the initial signs for Kyle and Jackie O’s replacements Dan Debuf and Maz Compton (Dan and Maz) were positive, despite the duo falling below three per cent audience share last survey. 

“Dan and Maz are still early days but the signs up there are really, really good,” said Bush. “We just have to be patient. Everyone outside the business seems to think we are in trouble but we just have that one challenge (2Day).

“If you look at the Southern Cross business across the board the business is still in a very strong position.”

The announcement of Blackley as the new head of the business yesterday morning prompted a slight fall in Southern Cross Austereo’s share price (ASX: SXL)  from $1.09 to $1.05, although it has slowly been rising on Friday morning to $1.07 at midday.

SCA share price

 

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Blackley

New CEO Blackley supported his chair saying the overall portfolio of radio and television assets is what drew him to reenter the media following a tumultuous exit from Ten back in 2011.

“The principal reason I was attracted to Southern Cross is you have a wonderful history, strong existing portfolio of brands, a great group of people and you put all that together you have some positive challenges but you have a solid base to work from,” said Blackley.

“There is improvement needed in a few areas but any company I have ever worked with always has its strengths and weaknesses.”

Asked about comments from competitors that the HitFM strategy is struggling nationally, with mixed results in various markets, Bush said:  “I think we are satisfied that the business is in good shape.

“I’m a believer that you can always do better. Part of the reason we were looking for someone like Grant is that someone with his experience in the media can bring an awful lot to the table to help us with continuous improvement.”

SCA has been clear that it believes the HitFM strategy needs time to bed in, with executives previously saying they were “at the bottom of the cycle” and asking the radio market to wait to judge it until drive stars Hamish and Andy return in July. 

However, Blackley conceded there was some work to be done. “I think we can improve the assets as they stand,” he said.

“Those that are already successful and then there are those that need a little bit of work.”

Asked about the whether SCA was hopeful of changes to the cross media rules that might allow a much speculated takeover of SCA by Nine Entertainment Co Bush played down any imminent change in the legislation.

“I’m one of the few people in the media industry who thinks this is something that isn’t on the government’s agenda anytime soon,” said Bush.

“These guys are trying to push through a budget with a very very difficult Senate and I can’t see either the Minister or Prime Minister wanting to take this on.

“Whilst all of the regional groups have a clear and cohesive view on what we think should happen but certainly amongst the free-to-air owners there is no consensus. We have to be masters of our own destiny in any case and put ourselves in the best position regardless of the media laws.”

Asked what success would look like for Blackley in a few years the new CEO commented: “Success in a year or two’s time? People will look back and see a journey.

“One that has taken Southern Cross to a far stronger, more cohesive set of brands and an earning profile that is a sustainable level of earnings that shows growth in the short term and also into the future.

“That is where I would like to see the company in a few years.”

Nic Christensen 

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