Lachlan Murdoch takes the helm of Ten as Grant Blackley is fired

Lachlan Murdoch has been named acting CEO of Network Ten after the board sensationally announced the departure of Grant Blackley. The move coincided with Ten’s revealing unexpectedly poor profit numbers for the first half of the financial year.

The board also revealed it would be revisiting its strategy, throwing an even greater shadow over the ratings-challenged 6PM With George Negus.

Although the company stressed that Murdoch’s appointment is an interim one, the move will inevitably raise questions over whether he will take the role on a permanent basis. Murdoch joined the board last year after he and James Packer became major shareholders.

Despite the success of Masterchef and a strong launch for digital channel Eleven, the board informed the ASX of a profit fall of more than 15% for the company’s TV operation.

The first half of the financial year – which for Ten runs until the end of this month – is likely to see profits for the TV division down to $92m, compared to $109m at the same time last year.

The revelation will come as a major shock to the market as the TV advertising sector has been buoyant.

Blackley’s axing comes just three months after the Ten board extended his contract to 2013.

Ten said that Murdoch’s move into the acting CEO role was “at the unanimous request of the board”. It signalled a search would be undertaken for a new CEO.

In a move that appears to signal an early rethink for Ten’s controversial news scheduling strategy, board chairman Brian Long said: “The Board continues to be responsible for all decisions regarding the strategic direction of the Company, and has decided to conduct an immediate strategic review of the Company’s operations.”

Blackley’s boldest move was to move Neighbours and The Simpsons to new channel Eleven and launch a two-and-a-half hours news strand including the George Negus-fronted 6pm national news show.

The announcement stated: “The Directors also advised they have received preliminary information associated with the forecast financial results for the half year period to 28 February 2011. On the basis of these forecasts, the Board anticipates that Group earnings before interest, tax, depreciation and amortisation (EBITDA) for the half year to 28 February 2011 will be approximately $103 million (1H FY10 – $117 million). Television EBITDA is expected to be $92 million (1H FY10 – $109 million) with revenue growth of 2 per cent on the prior six month period. Out-of-Home EBITDA is expected to be $11 million (1H FY10 – $8 million).”

Long said: “I would like to thank Grant Blackley for his contribution to the Company over some 20 years.”

Blackley’s sacking comes just five months since the company revealed its aggressive plans for 2011. The key parts of the announcement were a performance spectacular called Don’t Stop Believing, the new news lineup and new renovation reality contest The Renovators.

Ten later ditched its plans for Don’t Stop Believing and ratings for Negus are yet to touch the modest 500,000 target set by the show’s EP Tony Ritchie.

At the time, Blackley told Mumbrella: “I think we’re on a great path.” He also said that the controversial news strategy was “a positive calculated risk.”

Last night Negus rated just 374,000 – well behind Seven News (1.353m) and Nine News (1.196m) which both picked up viewers hungry for news of the New Zealand earthquake.

This afternoon, Ten’s share price dropped slightly on the ASX.


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