Nine has reported a 15% dip in earnings and 21% profit drop for the first half of FY24, with the company noting “inflation, increased interest rates and cost-of-living pressures weighing on consumer and business sentiment”.
Overall revenues were down a modest 2%, to $1.37 billion, however earnings before tax slipped 15%, to $316.1 million, “reflecting markedly weaker economic and advertising market conditions impacting most of the markets that Nine operates in”.
Net profit after tax fell to $149.5 million from $190 million in the first half of FY23 – a drop of 21%.
Nine has net debt of $538.4 million — excluding lease liabilities –, an increase of $15.2 million from the prior period.
ADVERTISEMENT
Operating Cash Flow increased $45.9 million to $169.4 million compared to the comparative period, “mainly due to a decrease in income taxes paid of $55.4 million”.
Nine’s Broadcast division (Nine Network, 9Now, and Nine Radio. Broadcast) revenue decreased by 9%, to $654.6 million, while earnings decreased by 27% to $163.7 million.
Nine Network reported a revenue decline of 11% for the six months to $508.3 million, despite holding a leading revenue share of 39.0% in the TV market. 9Now revenue grew 6%, to $93.8 million from $88.6 million, while Nine Radio revenue dropped 3%, to $52.5 million.
Digital and Publishing revenue declined by 4% to $288.7 million with EBITDA down by 19% to $77.8 million.
Despite this, strong growth in subscriber numbers and price increases across The Age, The Sydney Morning Herald and The Australian Financial Review saw a 5% growth in Average Revenue Per User.
Total subscribers grew by 480,000 (7%) and registered users increased by more than 1.5 million, “more than offsetting the decline in print masthead sales and reflecting investment in quality content and the paywall tightening strategy,” despite a decline in digital advertising revenue of 17% across the period.
Digital now accounts for around 61% of Publishing revenue.
Stan revenue has increased 11% to $228.4 million, with paying subscribers currently above 2.2 million, and price increases driving an 11% increase in ARPU. EBITDA has increased by 41% to $25.3 million.
Revenue for Domain has increased 11% to $207.1 million and EBITDA increased by 37% to $67.6 million.
“Notwithstanding the impact of challenging economic conditions on the broader advertising market, the breadth of Nine’s business underpinned some key operational highlights across the half,” says CEO Mike Sneesby.
“I am particularly pleased with the performance of our subscription businesses – with Subscription and Licensing revenues at Nine’s wholly owned businesses, Stan and Publishing, together growing by around 8%, to more than 30% of group revenue ex Domain.
“At Stan, 11% revenue growth (to $228.4 million) and more than 40% EBITDA growth is testament to Stan’s strong positioning in Originals and Sport which continues to pay off, as well as its focus on cost efficiencies.
“Within Publishing, the 9% growth in digital subscription and licensing revenue at our metro mastheads, inclusive of price increases, more than offset the decline in print subscription revenue.”