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Prime warns ad revenues down nearly 10 per cent and renews calls for media reform

Prime MediaRegional TV broadcaster Prime Media has said its ad revenues for the start of the current financial year are down nearly 10 per cent, blaming weak consumer sentiment and the challenges caused by the “communications revolution”.

This morning Prime’s share price dropped by 14.75 per cent to 52 cents, the company’s lowest share price in six years. It put’s Prime Media Group’s market capitalisation at $195.18m. 

In a trading update to the Australian Securities Exchange yesterday afternoon Prime CEO Ian Audsley said ad revenues for July and August were down 9.6 per cent on last year, and warned September was likely to see a similar result.

Chairman John Hartigan used the update to continue the campaign urging the government to change media regulations and allow the regional broadcaster to merge with one of the metropolitan players, which have seen revenues remain stable.

Earlier this month Prime made a number of redundancies in its regional newsrooms as it looked to slash costs.

In the update Audsley blamed the result in part on the AFL Grand Final falling in October this year, but said the broadcaster had “maintained it revenue share lead” among the regional broadcasters.

“There is a lack confidence among regional advertisers due to poor consumer sentiment, which in turn has resulted in a very short market with limited visibility. Markets dependent upon mining activity are the most affected, particularly regional Western Australia,” he added.

In the address Hartigan, a former CEO of News Corp, restated the case being made by the regional broadcasters in a marketing campaign for the government to relax rules stopping broadcasters reaching more than 75 per cent of the population.

He said: “There is no doubt that all regional broadcasters are facing significant challenges as a result of the communications revolution in which we find ourselves.

“We have been telling the Government for quite some time now that regulatory reform is urgently needed. We are hopeful that Prime Minister Turnbull, who in his previous role as Minister for Communications had a deep understanding of our issues, will continue to support the reform of out-dated rules and regulations.”

Prime is holding an AGM on November 10 when it says it will give another trading update.

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