Media by the numbers: a guide to the industry’s financial performance

It’s that time of year when listed companies are forced to face the music, when the books are thrown open and scrutinised by shareholders, media and investors.

In short, it’s the time of the year when senior executives must explain themselves.

Below is Mumbrella’s wrap of the financial performance of the industry’s ASX listed companies.

News Corp

News Corp (ASX: NWS)

News Corp global profits slid almost 30% to $684m, as the media firm’s digital real estate division, which includes REA, became more profitable than its struggling news business.

Profits from news tumbled from $603m to $213m, a huge fall offset only partly by its digital real estate operation, which saw profits climb from $201m to $344m.


News Corp’s share price performance over the past month

The publisher of The Australian, The Daily Telegraph and Herald Sun reported global revenues of US$8.3b, down 3% on the previous year.

News Corp’s share price has climbed steadily since releasing its results on August 9, rising from $17.48 the day before the announcement to $18.70 at time of publication.


Fairfax Media (ASX: FXJ)

It was a similar story at Fairfax, which revealed on August 10 that it now makes more cash from real estate brand Domain than from its metro print division.

The publisher reported an underlying profit of $132.5m, down 7.6%, with an earnings before interest and tax of $213.2m.

Domain generated more than half that EBIT amount, dwarfing the metro print division, which generated earnings of $13.8m, down from $30.5m last year.

Screen Shot 2016-08-26 at 4.30.40 pm

Fairfax share price performance over the past month

Chief executive, Greg Hywood, who earlier this year said it was “inevitable” SMH and The Age will close its weekday editions, has heralded the result as “proof” that the transformation of Fairfax Media over recent years “has succeeded”.

“The stable top-line revenue and EBITDA make it clear that we have reshaped this company into a high-value, broadly based, digital rich business,” he said.

Fairfax’s share price dipped 5c to $0.95 on the results announcement but were trading at $0.98.

Current market capitalisation: $2.26b.

Seven West MedisSeven West Media (ASX: SWM)

A year after making $1.8bn in write-downs, Seven West Media reported a net profit after tax of $207.3m.

But revenues fell $60m in the past 12 months to $1.713bn, from $1.774bn.

The company, which owns the Seven Network, West Australian Newspapers, Pacific Magazines and half of the Yahoo7 joint-venture, said NPAT was down 0.9% on last year, although that result was over-shadowed by the massive write-downs.

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Seven West Media share price performance over the past month. It reported its year-end result to the market on August 2

Seven flagged the TV advertising market as “short” and warned that the TV ad market was likely to be “flat to down” in the next 12 months. It also warned that underlying earnings for the company would be 15-20% down next year, thanks mainly to “increased content costs from the Olympics and AFL”.

The network’s share price sunk from $1.04 on August 1 – the day before the results were unveiled – to a low of $0.76, where they have hovered since then. At close of trading today, Seven’s share price stood at $0.78.

Current market capitalisation: $1.18b.

nine_entertainment_logoNine Entertainment Co (ASX: NEC)

Nine, reporting a 7% fall in after tax net profit, admitted its ratings and revenue performance in 2016 had not been good enough, and is now banking on a 50% increase in premium, local content to entice more advertising dollars.

Chief executive, Hugh Marks, speaking at the results announcement on Thursday, said its programming, while strong in news and sport, has been lacking some content “which advertisers are demanding”.

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Nine Entertainment’s 5-day share price performance

Nine, which revealed its results yesterday, also warned of a “flat-to-down” TV ad market over the next year after a 2% decline in metro markets in 2016 and a sharp 6.2% fall across the regions.

The network also said it was exiting an “onerous” ‘life of series’ arrangement with Warner Bros., which had been draining cash from the business, and flagged its new affiliate deal with Southern Cross as showing early positive signs.

Nine’s share price initially rallied from $1.01 to $1.07 before falling back to $1.03.

Current market capitalisation: $ media groupPrime Media (ASX: PRT)

Regional television operator Prime saw revenues fall 7.7% to $239m and profits fall 17.1% to $55m in the first half of this year, but flagged improved fortunes due to the Olympics and AFL.

The company – which is mainly affiliated to Seven – also wrote down the value of its broadcast licences by $122.9, resulting in a statutory loss of $93.6m.


Prime Media’s share price movement over the past five days

Prime Media told the market last week that its performance had improved during the current quarter, with the Olympics delivering more advertising revenues and bookings around AFL finals in September “encouraging”.

Prime initially saw its share price raise 9% to $0.31 before falling back to $0.26.

Current market capitalisation: $93.41m.ooh mediaOoh Media (ASX: OML)

Revenue at out-of-home advertising company Ooh Media climbed 18% in the first six months of the year, with profits rising 33%. And unlike rival company APN Outdoor, Ooh Media said it was reaffirming previously announced profit guidance for the full year.

The company reported revenue of $146.6m, up from $124.1m, while earnings before interest, taxation, depreciation and amortisation (EBITDA) increased from $20.2m to $26.8m.


Ooh Media’s 5-day share price movement

The encouraging performance helped Ooh’s share price recover after falling sharply the previous day after a profit warning from rival APN Outdoor reverberated across the out-of-home ad industry.

Current market capitalisation: $725.21m.APN OutoorAPN Outdoor (ASX: APO)

Despite reporting a decent set of first half results –  revenue grow 10% and earnings up 31% – APN Outdoor saws its valuation plummet by a third after warning of a “significant reduction in market activity for the September to November period”.

The weak outlook prompted the company to downgrade its full year guidance with EBITDA now likely to hit between $79m and $84m, down from the previously announced forecast of $84m and $88m.


APN Outdoor’s valuation plunged after releasing its results last week before slowly recovering

Revenue for the company climbed from $136.3m in the first half of 2015 to $150.6m, while the company posted earnings of $34.8m – up $8.2m on the first half of 2015. Its EBITDA was $26.6m.

APN Outdoor’s share price tumbled more than 33% to $5.49 – wiping half a billion dollars of its value – before recovering to sit at $5.31 at close of trading today.

The profit warning set nerves jangling across the sector with share prices at Ooh Media and Queensland-based QMS also sliding sharply.

Current market capitalisation: $868.06m.

STW no more as name change approved


Advertising firm WPP AUNZ reported its first result since the completion of the merger with STW Group earlier this year, with a flat first half.

On a like-for-like basis net sales remained steady, down 0.1% to $407.3m Earnings before interest and tax (EBIT) slipped 0.4% to $47.2m.

WPP AUNZ chief executive, Michael Connaghan, told the market on August 19 that it was a promising result for the company.


WPP’s share price performance over the past month

“While we are very much in the initial stages of the merger integration, it has been a very positive beginning,” Connaghan said.

Not quite so positive was WPP’s outlook, which Connaghan described as “cautious”. He cited a flat media market, restrained client spend and a subdued macro-economic environment in key markets.

Current market capitalisation: $971.45m.macquarie media limited

Macquarie Media (ASX: MRN)

The owner of Radio 2GB and Radio 3AW, Macquarie Media, posted an after tax profit of $14.3m profit in its first full results since its merger last year with Fairfax Radio. 

The result “demonstrates the economic benefits of the merger,” chairman Russell Tate said.


Macquarie Media’s share price performance over the past month. The firm reported its financial results on August 8


Total revenue fell 4% to $135m while earnings before interest, tax, depreciation and amortisation soared 70% to $25.4m. Tate noted, however, that due to the merger the year on year comparison was not relevant.

Current market capitalisation: $169.29m.



Enero Group (ASX: EGG)

Enero returned to the black after a net loss of $2.8m last year, posting a profit of $6.6m.

The parent company of agencies including BMF, Naked, Frank and Dark Blue Sea, reported a rise in net revenue of 3% to $113.5m compared with $110.3m a year ago.

Growth in international markets offset a near-14% drop in Australian revenue, from $53.4m to $46m.

Enero said with smaller agencies in the group faced difficult trading conditions and reported mixed results. BMF bucked the trend however and recovered from the loss of its Lion Nathan XXXX account with new business wins.


Enero’s share price performance over the past month. The company announced its results on August 10

Enero’s share price climbed on the back of the results before flaking back last week.

Current market capitalisation: $101.87m.

APN logo

APN News and Media (ASX: APN)

APN News and Media, which reported its interim results yesterday, said it was looking forward to a world without traditional publishing assets after posting a loss of $257m.

The result included New Zealand Media Entertainment (NZME) and Australian Regional Media (ARM), both of which will be off its books come the year-end results.


APN News and Media’s 5-day share price performance

Splitting out NZME, which has demerged from APN, and ARM, which is in the process of being sold to News Corp, the company made a profit of  $10m, up from $1.3m

APN chief executive, Ciaran Davis, said the sale of ARN will leave the company with “zero exposure to traditional publishing” and “100% exposure to growth media assets”.

But the market was not convinced, with APN’s share price falling sharply before a partial recovery.

Current market capitalisation: $736.99m.

southern cross austereo

Southern Cross Austereo (ASX: SXL)

Chief executive Grant Blackley was in bullish mood after guiding the company to a net profit after tax of $77.2m, a 19% increase on the previous year.

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Southern Cross Austereo’s five-day share movement

Revenue for the full year climbed 5.1% to 642.3m with earnings before interest, tax, depreciation and amortisation rising 2.8% to $167.7m.

The performance, which follows Southern Cross’s landmark deal with Nine Entertainment Group to take over affiliate broadcast rights from WIN in April, was heralded by Blackley as a “reset” after two years of unrest.

The market liked what it saw, with SXL’s share price rising sharply after the results were released last week.

Current market capitalisation: $1.13b


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