Markets wrap: ASX poised to rise ahead of wage price index; Seven West Media, News Corp report revenue boost
Reporting season continues to reveal strong organic growth in most media holding companies. Tomorrow’s release of the quarterly wage price index has Australian shares poised to rise on the ASX today.
It was a mixed session for key US stock indices as the Dow Jones and S&P500 both gained. However, a late sell-off in tech stocks saw the Nasdaq close in the red. The ASX 200 closed at 41 points higher at 7105, extending its rally.
Several media and advertising holding companies have released their FY and Q2 earnings in the last week, reporting strong performances in APAC region and positive post-release stock market activity.
Read on for a summary of the financial performance of major media and marketing holding companies.
Seven West Media:
- Seven West Media (ASX:SWM) released its FY22 earnings yesterday, revealing the strongest performance since 2011.
- SWM reported a #1 national network spot in ratings and revenue in addition to a group EBITDA of $342 million.
- Seven West Media’s FY22 earnings revealed $1,540m in revenue, up 21% since the previous reporting period.
- On an earnings call to investors and analysts, CEO James Warburton confirmed that 7plus has driven 40% of Q2 22 earnings
- Net debt at the end of the financial year was $256.5 million, which included the acquisition of Prime Media Group’s assets on 31 December 2021.
- Looking forward, Warburton said Seven plans “targeting 40% of revenue share of the national total television market in 2024”, in addition to expanding the existing $60 million Seven Ventures portfolio and pursuing value accretive M&A.
- The Seven Network has today released its new, free educational content series to equip marketers and agencies with the skills to confidently navigate the new total TV landscape across linear broadcast and broadcast-video-on-demand (BVOD).
- The SWM share price trades at 0.50 AUD today, with a market capitalisation of 787.41M.
- Shareholders have been advised that the Board of Seven West Media (ASX: SWM) has approved an on-market buyback of up to 10% of shares on issue.
- Should SWM fully complete the proposed share buyback, leverage is forecast to remain within the group’s target leverage range of between 1 time to 1.5 times. The buyback will be funded out of existing debt facilities.
Dentsu:
- Denstu Group last week released its Q2 2022 results, reporting continued performance of 8.4% revenue growth and 13.6% operating margin.
- Dentsu Group reported a strong second quarter with organic growth of 8.2%.
- Australia’s performance surpassed many other APAC markets in the June quarter, with the Japan-based global advertising group reporting Australia’s H1 organic growth at 8%, ahead of the APAC region’s 4.8%.
- Dentsu’s largest 20 clients grew 12% in the quarter, in addition to the Dentsu Health initiative, which was launched last year, becoming a top 5 health and wellness network globally.
- Dentsu’s share price currently trades at 4,765 JPY, with a market capitalisation of 1.40T.
- Dentsu’s Australian holdings posted a loss of $23,601,000 for the calendar year ending 2021 according to an annual audit by EY, following losses of $30,393,000 in CY2020.
News Corporation:
- News Corp’s Q2 results last week revealed an 11% increase in 2022 full-year revenue to $US10.39 billion (A$14.85 billion).
- At News Corp Australia, revenue increased 9% for the full year and 6% in the June quarter.
- Net income for the year to June was $US760 million (A$1.08 billion), a 95% lift from the $US389 million (A$556 million) of the prior year.
- REA Group Ltd (ASX: REA), owned by News Corp, also released its results for the year ended 30 June 2022. Group financial highlights from core operations included revenue growth of 26% to $1,170 million, an increase in EBITDA including associates of 19% to $674 million, and a 25% increase in net profit to $408 million.
- The NWS share price currently sits at 27.16 AUD, with a market cap of 10.84B USD.
Have your say