Nine posts $592.2m net loss after writedowns

NEC logoNine Entertainment has today become the latest media player to post poorer than expected results with the TV network posting a $592.2m loss after writedowns.

The result came despite Nine’s net profit after tax remaining relatively stable at $140.1m, down 2.9 per cent on last year.

Source: Nine investor presentation

Source: Nine investor presentation

“In what has been a difficult free-to-air advertising market, our June quarter share performance was short of our expectations,” said David Gyngell, CEO of Nine. “However, we are pleased with our improving ratings performance trend over the first couple of months of FY16.”

Nine’s revenue was up 2.6 per cent to $1.61bn while earnings before interest, tax, depreciation and amortisation (EBITDA) was down 7.6 per cent to $287.3m.

The TV network is one of a number of TV players posting significant writedowns in licence and goodwill with Nine posting a $791.8 non-cash impairment plus $57.4m in inventory write-offs.

NEC’s television revenues were down 1.1 per cent to $1.207bn down in 1.1 per cent while digital revenues were up 33.2 per cent to $163.4m.

In EBITDA terms Nine television division was down 14.7 per cent posting $206m while Mi9 was up 40.4 per cent to $21.9m.

Commenting on the television market Peter Wiltshire, group sales and marketing director said: “It has certainly been a pretty tough year for both Nine and the free-to-air industry.”

“Free-to-air generally underperformed against the general ad market as the industry faced structural headwinds,” he said. “Nine’s share of the market for revenue was up 0.2 points to 38.2 per cent.”



Nine CEO David Gyngell was asked about how he saw the rest of the year playing out in terms terms of and predicted that rival Ten, who has lifted their performance this year, would “fall into a bit of a hole” in the latter half of 2015.

“We’ll be a 38 (share), Seven will be a 38 and a half 39 and Ten 23, 23 and a half”, said Gyngell. “We have a couple of voices in there so we will hold up. Seven will pull forward some revenue because of the Olympic Games coming along they will write some extra advertising and Channel Ten will pick up bits and bumps around the Masterchef but will fall into a hole coming in to the end of the year.”

“That’s a fair assumption as to where they will end up.”

As of 11am this morning, Nine’s share price was up 1.9 per cent to $1.48.

Nic Christensen 


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