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Revenues down but cost cutting sees profits rocket 175% at Macquarie Media Limited

macquarie media limitedMacquarie Media Limited’s revenues fell by 9% in the last six months of 2015 compared to those of the separate Fairfax Radio and Macquarie Radio Network businesses, but profits still soared by 175% comparatively.

In its results for the first six months of trading Macquarie Media Limited, which boasts stations including 2GB, 3AW and 4BC, managed revenues of $66.83m, down on the combined $73.7m revenues of Fairfax and MRN in the prior corresponding period.

In the results chairman Russell Tate said while he was disappointed it was behind in revenues he was confident the company would hit forecast, and hinted at “further significant savings” that would be made.

Cost-savings, which has seen dozens of on-air and backroom staff depart the network in recent months, already mean comparable profits are up by 175% to $6.6m.

In a statement to the Australian Securities Exchange (ASX:MRN) Tate said he was disappointed the revenues were down, but said the cost savings had been in line with budget.

'confident': Russell Tate

‘confident’: Russell Tate

“I am confident of achieving our full year earnings (EBITDA) guidance in the range of $20-25m,” he said.

“Our sales force has undergone massive change in personnel and approach to the market and we are now starting to see the benefit of those changes in year on year revenue increases.”

However he also hinted there could be further pain for staff at the network, with stations including Magic having been stripped back dramatically already, saying: “We continue to fine tune our operating structures and personnel, and we will realise further significant savings in operating costs.”

In the results the company said it expects to offload Sydney station 2CH by the deadline set by regulators of March 31.

The results also did not include comparable figures from Perth station 96FM which was offloaded by Fairfax as the merger was sealed in December 2014.

Alex Hayes

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