Nine predicts 15% revenue growth in metro FTA advertising for December quarter
Nine is predicting an earlier-than-expected turnaround in television advertising revenue for the second quarter of FY21. It comes after a difficult FY20 in which it posted a $575m loss.
Speaking at the company’s AGM on Thursday, CEO Hugh Marks said he now expects Nine’s metro free-to-air advertising revenue to grow around 15% in the December quarter.
Nine CEO Hugh Marks
In August, Nine predicted the first quarter of FY21’s free-to-air revenue to be down around 15%, but improvement in the free-to-air advertising market since the end of September allowed the company to deliver a more optimistic estimate for the following quarter.
“The underlying ad market has markedly improved since our August update,” Marks said, citing the “added benefit of major event timing (State of Origin and NRL Finals).”
As a result, Nine expects metro TV ad revenues in the December half to be “broadly flat on the prior period”.
In addition, Nine revised its expectations of 9Now revenues in the December half and is now predicting a 25% increase on the prior period.
Addressing costs, Marks said that the first half free-to-air costs will be down “in the double digits”, but that the return of the NRL would see second half costs increase on last year.
As a result, Nine now expects full-year free-to-air costs to be down 4% on FY20, prior to revenue-related costs.
Trends for Nine’s other businesses cited at the FY20 result remain unchanged, apart from Domain which saw trading for the first four months of FY21 improving on late FY20, while digital revenue for the period to October rose around 4%.
“We are certainly trading more positively than we would have anticipated three months ago and are very pleased with the operating performance in each of our business units,” Marks said.
“Despite this, given our limited visibility on the second half advertising market, we do not believe we are in a position to provide guidance on earnings for the full year.”
Marks said that Nine expects to be in a position to address this at half year results in February.
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Zanda Wilson was a reporter and podcast producer at Mumbrella, specialising in radio reporting. He left Mumbrella in September 2021.
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