HT&E posts mixed results as soft radio market drags on revenue

HT&E has seen a 75% boost in revenue in the first results since the company sold off its newspaper interests and rebranded, but chairman Peter Cosgrove admitted performance has been mixed with a weak radio market dragging the business back.

HT&E CEO Ciaran Davis said radio ad market had been soft, but outdoor looking strong in mixed half-year

Revenue for the outdoor, radio and digital company, which sold its Australian Regional Media business to News Corp last year and divested its New Zealand print business, was $225.7m while earnings before interest, tax, depreciation and amortisation were up 28% to $40.6m.

The company also rebranded from APN News & Media to Here, There & Everywhere.

The result is a major turnaround for the business, freed from the loss-making print operations which saw its statutory net loss plunge to $257m in the six month to June 30 2016, from a first half profit in 2015 of $7.5m.

In the first half of 2016 net profit after tax for its retained operations – Australian Radio Network, Adshel and Hong Kong Outdoor – hit $10m, up from $1.3m, with revenue down marginally to $129.1m.

While the business is now freed from the burden of the print operations, HC&E chairman Peter Cosgrove admitted that a soft radio market had impacted the overall result.

“In its first period of reporting since the divestment of all traditional publishing assets, HT&E has delivered a mixed result for shareholders, however there is a platform of highly attractive media assets to build on,” Cosgrove said.

Radio was soft for HT&E

CEO and managing director Ciaran Davis talked up the contribution of outdoor to the company’s performance, but also admitted that radio had been a challenge.

“Whilst the radio result was disappointing it remains a very robust sector with consistent year-on-year audience and revenue growth,” Davis said.

“The medium remains highly attractive to advertisers due to its immediacy, its ability to integrate content across multiple platforms, but most importantly, its effectiveness at delivering results for advertisers.

“Adshel had a fantastic first half and the investments that were made in digital, data and capability in the lead up to and post the acquisition in October last year are delivering results.”

Revenue for the Australian Radio Network, which includes the Kiis, WSFM and Mix, was down 6% from $112.2m in the first half last year to $105.3m this year. Underlying EBITDA was down 17% to $33.2m.

While it celebrated strong ratings for Kyle & Jackie O and Jonesy & Amanda, it was taking key actions to address soft revenues in a weak advertising market and was continuing to invest in developing its digital offering.

After HT&E brought out Clear Channel’s 50% stake in Adshel last year, the outdoor operator reported first half revenues up 14% to $105m and underlying EBITDA up 23% to $22.2m.

However, the company has launched a strategic review of its Hong Kong outdoor business after it reported a first half revenue slump of 17% to $11.9m and an EBITDA loss of $1.2m.

“Challenging market conditions have continued in Hong Kong, driving revenue declines,” the company said.

“An active programme to exit non-performing contracts has resulted in H1 advertising revenues declining 17 per cent to $11.9m, with costs down 12 per cent.”

The company said it looked to modest growth for the remainder of the year in radio while delays in digital panel roll outs were frustrating some of Adssel’s ambitions but it remained focused on achieving its full-year expectations.


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