Seven West Media reports a 48% jump in revenue after growth in metro TV advertising
Seven West Media has today reported a net profit after tax of $120.5 million on group revenue of $819.5 million, an increase of 48% on the previous year for the half-year to December.
The group reported revenue up 27.2% on the prior corresponding period on a continuing operation basis, driven by a recovery in the metropolitan TV advertising market and the growth of 7Plus.
Net debt was reduced by $212.4 million to $116.7 million, which includes the consolidation of cash from Prime. However, adjusting for the timing of the Prime acquisition and some cash movements, pro-forma net debt for the group is $295 million.
Seven West Media managing director and chief executive officer, James Warburton, said: “We have a television network that has returned to the #1 position in a robust advertising market; a fast-growing digital business that now makes up 35% of earnings; a turnaround at WAN; and a team focused on growth.
“We have completed the acquisition of the assets of Prime Media Group, which unlocks an unrivalled opportunity for the business to capture a greater share of the $3.8 billion total television market.”
He added: “We had an amazing start to the financial year with the Olympic Games Tokyo 2020, which was the biggest television and streaming event in Australian history. The Voice exceeded our expectations, becoming the #1 regular series of 2021, while the AFL Grand Final was the #1 program of the year. Our new entertainment schedule is driving television ratings gains and significant growth for 7Plus. Over 11 million users are now registered on 7Plus and we expect this to grow further with the Winter Olympics in Beijing.
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“WAN continues to execute its strategy of holding the line on print, reducing costs and turbo-charging the digital and subscription side of its business. Revenue growth in digital more than offset print decline in the period. Underlying EBITDA grew 65% in the period after excluding one-off benefits for JobKeeper and PING grants in the prior period.”
Warburton continued: “Seven West Ventures has strong momentum, completing six investments in the period, including four new companies with large addressable markets. The investments are predominantly via media for equity which can be supercharged by SWM’s assets. The portfolio value increased 56% to $87 million in the period.”
Seven West Media said the strength of the television and BVOD advertising markets has continued in the second half. Q3 metropolitan TV bookings are tracking 13% ahead of a year ago, including the Ashes Test series and the Winter Olympics. Targeting a two-percentage point increase in revenue share in the second half of FY22.
Seven Digital EBITDA forecast increased to more than $130 million. Group costs were at mid-range of previous guidance, before Prime.
WAN revenue to grow low single digits in FY22, the group EBITDA target has been upgraded to $315 million to $325 million, including $10 million Prime second half contribution, and the SWM Board will assess capital management options during 2H22 to further enhance shareholder value.
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