Southern Cross Austereo: We didn’t expect Kyle & Jackie O announcement to hit share price
Southern Cross Austereo has defended its decision not to inform shareholders of the end of the Kyle & Jackie O Show via the ASX.
ASX SXL | Source: Google Finance
After the announcement that Kyle Sandilands and Jackie Henderson were leaving SCA’s Today network, the company’s share price went into one of its biggest two day slides in its history. More than $100m was wiped off SCA’s market capitalisation.
The Kyle & Jackie O show, which airs on Sydney’s 2Day FM, is the top rating FM show in the city. Sydney is Australia’s biggest radio market with annual advertising revenues of $210m.
When a listed company such as SCA is aware of information that could affect its share price, ASX rules state that it should first announce that information to the market. But the Kyle & Jackie O announcement was made on the show and on the station website.
As a result, the ASX has written to SCA asking for an explanation. In a letter to the ASX released today, SCA blamed media coverage for the price crash.
It said: “Given the high media profile of the show, there were a number of media articles published, which may have led to speculation regarding the impact of the show’s loss on the company. This may in turn have led to a change in price of the company’s securities. However media commentary on the matter did not take into account that the company is a diversified media business with 78 regional and metropolitan radio stations, a suite of digital stations, 21 commercial television licences, 105 leading websites, mobile sites and mobile applications.”
The explanation added that 2Day FM, its Sydney station, makes up just 6.5 per cent of the group’s revenue.
However, the statement did not address the fact that highlights of The Kyle & Jackie O Show is also networked by the company nationally.
Both presenters feature prominently on the home page of Southern Cross Austereo’s corporate website.
Tim Burrowes founded Mumbrella in 2008. He worked on Mumbrella until 2021. At various points he was editor, content director and editor-at-large.
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Translation: “Honestly, we thought the price would rise”.
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How could you not expect a major announcement like this not to affect the share price? C’mon. Really?
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Doh!
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“105 leading websites”
That Clive Dickens has got some front.
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Wasn’t it the Chairman of SCA who only two weeks ago quipped “shit happens” when he so respectfully talked about two of his hosts causing the suicide of a nurse in the UK.
Oh sweet serendipity.
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