HT&E sees revenue increase but significant impairment cost in latest earnings
Here, There & Everywhere (HT&E), the owner of radion network ARN, has reported revenue of $344.9 million for the 2022 full year, however net profit was impacted by a “non-cash impairment of intangible assets”.
The revenue for the 12 months ended 31 December 2022 surpassed the previous corresponding period by $119.9 million.
The underlying EBITDA (before significant items) was $91.8 million and the net profit after tax (before significant items) was $48.5 million.
However, the group reported an impairment charge related to $249.9 million for the ARN Cash Generating Unit (CGU): “goodwill was fully impaired by $156.8 million, radio licenses were impaired by $84.9 million, brands were impaired by $5.5 million and customer relationships were impaired by $2.7 million at 31 December 2022”.
An impairment loss must be recognised for a CGU when the recoverable amount of the unit is less than its carrying amount.
Alongside a $1.9 million charge for radio licenses recognised on the sale of 4KQ, the impairment charge is included in significant items. Hence, the statutory underlying net loss was $173 million in 2022.
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HT&E announced a 5.2-cent dividend per share from 2023 profits.
For the segment breakdown, the ARN Group (metro, regional and digital) saw a total revenue of $314.8 million in 2022, including $192.5 million from metro, $107.7 million from regional and $14.6 from digital. Total cost was up 9% due to investments in youth brand CADA and inflationary pressure.
Cody Outdoor in Hong Kong brought in $19.5 million in revenue in 2022, challenged by tourism down on pre-pandemic levels.
The previously flagged sale of stakes in Soprano has been approved by Foreign Investment Review Board on 22 February, with HT&E to receive around $66.3 million in cash for the sale. The deal is expected to complete by 31 March.
HT&E chairman, Hamish McLennan said, “HT&E delivered an exceptionally strong performance in a year of considerable change and transformation. The acquisition of 46 regional stations from Grant Broadcasters has proven to be an outstanding investment and demonstrates the Company’s ability to identify the right opportunities to drive shareholder value.
“Despite global and inflationary concerns impacting consumer and advertising sentiment in the second half, HT&E’s full year results demonstrate the strength of the audio offering we provide our clients and considerable progress was made delivering on our strategic intent to build the best broadcast radio and digital audio business in Australia.
Ciaran Davis
HT&E CEO and managing director, Ciaran Davis, said: “HT&E finished the year with the best outright ratings performance ever, a reflection of our focus on quality content to drive audiences and creating the best broadcast radio and digital audio business in Australia.
“Our ARN Regional strategy to fiercely protect the localised nature of the individual regional station brands and the connections to the communities they serve is incredibly powerful and has paid off with improved ratings and growing revenues.
“Already strong local regional revenues are up by 7% on a pro forma basis, and importantly, the first year synergy target was delivered, with incremental revenues of $7 million, providing confidence in our ability to achieve the $20 million per annum target identified within three years of acquisition.
He added that the progress made during the year with the integration program is a “testament to the hard work and commitment across the group” and they were on-track to conclude the major components by the end of 2023.
“This acceleration of audiences has delivered improved advertising revenues in the second half, up 28% compared to the first half of the year, and provides increased confidence for a path to profitability by the end of 2024 – earlier than anticipated,” he said.
“We launched the new youth brand CADA in March 2022 and have quickly established over 3 million connections with 18–29 year olds. Delivering multi-platform advertising solutions for clients as seen new brands like Netflix and Bonds engaging with ARN. In 2023, our focus will be driving this new audience to engage with our core audio products of streaming and podcasting.
“While we are facing an uncertain macroeconomic environment, HT&E is incredibly well placed to withstand any potential short-term impacts to advertising revenues.”
HT&E trades at $1.22 on 21 February, with a market capitalisation of $378.62 million.
This article has been updated after publish.
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Darcy Song was a reporter at Mumbrella, covering media owners, adtech and social platforms. She left in October 2023.
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