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Bad year for investors with most ASX media investments declining in 2017

ASX investors who backed media and marketing companies mostly lost money, Mumbrella’s analysis of share market performance in 2017 reveals.

The worst ASX performer of the year was Ten, which started the year with a share price of 94c, but was put into administration in June as it became clear the broadcaster would be unable to get out of its financial difficulties. Shareholders lost their entire investment.

Meanwhile, Nine Entertainment Co (ASX:NEC) – owner of the Nine Network – was the only major media company to deliver big growth for its investors.

The company’s share price rose by 45.2% from $1.06 on January 1 to $1.54 at the end of the year, giving the company a market capitalisation of $1.34bn.

By contrast, arch rival Seven West Media (ASX:SWM) – owner of the Seven Network, along with Pacific Magazines and West Australian Newspapers – saw its market capitalisation fall below $1bn during the year, with the share price dropping by 24.39%.

Nine significantly outperformed Seven on the ASX in 2017 | Source: Google Finance

Investors in Southern Cross Austereo (ASX:SXL) – owner of radio networks Hit and Triple M along with as regional TV licences – suffered nearly as bad as those with Seven West Media shares – seeing a fall of 23.87% in the value of their investment.

However, other than Ten, the worst media and marketing investment on the ASX was media monitoring firm Isentia (ASX: ISD). The company had a nightmare year after writing off the value of its investment in content marketing company King Content and missing revenue expectations. The company’s share price halved, leaving it with a market capitalisation of $276m.

After Nine, regional TV minnow Prime Media (ASX: PRT) was the best performer, with a price growth of 9.68%, taking it to a market capitalisation of just over $100m.

Table prepared by Mumbrella based on Google Finance data | Click to enlarge

Communications holding group Enero (ASX:EGG) – which owns agencies including BMF, Frank PR, Hotwire and Naked – rose by 6%, taking it to a market capitalisation of $90.74m.

Meanwhile the largest locally listed agency player, WPP AUNZ, saw its share price fall by 25.2% over the year.

Media bosses in Canberra earlier this year, lobbying for media reform

Marketing services company RXP – which bought creative agency The Works during 2017, fell by 29.9%

And marketing services company Salmat (ASX:SLM), which runs the “Do not call” register along with catalogue and loyalty offerings, dropped by 5.45%.

Fairfax Media’s (ASX:FXJ) performance cannot be directly compared to the other media companies because the company span off real estate unit Domain in November, with Fairfax shareholders receiving shares in the new listing too. Overall, the value of their investment grew in 2017 though, with the company the only media outlet other than NEC to still be worth more than $1bn.

The only other media company where investors would have finished the year without losing money was out of home company Ooh Media. Although the company’s share price dropped by just under 3% during 2017, the company’s dividend yield was just over 3%, effectively laving investors breaking even.

The outdoor sector as a whole though had a disappointing year compared to its growth in 2016. APN Outdoor’s share price fell by 17% and QMS Media dropped by 11.5%.

And HT&E, formerly APN News & Media , owner of Adshel and also Australian Radio Network, saw its share price fall by a third.

Meanwhile, News Corp, which is Australia’s biggest news publisher as well as half owner of Foxtel, is jointly listed in the US, where the bulk of its assets are based. The company’s share price rose by 28.99% over the year, with most of that growth coming in the last month or so.

The total value of the media and marketing sector on the ASX is just over $6bn.

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