Southern Cross Media reports $296m loss after writing down regional assets

Southern Cross Austereo logoThe challenged radio and TV group Southern Cross Media has made a $392m write down on its regional assets, with adjusted earnings down 5.4 per cent for the year to $187.8m.

However, excluding the write down the group reported a profit of $79.7m, in line with the profit guidance issued in May and down from the $89m profit reported last year.

The fall has come as ratings for the groups radio and TV assets have plummeted, with the Today Network facing severe challenges in Sydney and the regional stations carrying Network Ten programming also struggling to attract viewers.

Radio revenue shares dropped to their lowest level in two years to 29.8 per cent in the final quarter of the year, with the company averaging between 33 per cent and 35 per cent of the market in the two years before that. Both national and local ad revenues for radio dropped to their lowest in four years as well, down to $162.2m nationally, and $67.4m regionally.

However, in a statement to the Australian Securities Exchange this morning CEO Rhys Holleran said: “The FY14 results continue to show the resilience of our business. In what has been a challenging trading environment, and a challenging year for the group overall, I am pleased with the results and the direction in which the group is headed.”

2DayFM in Sydney has suffered a ratings collapse since the departure of breakfast hosts Kyle Sandilands and Jackie ‘O’ Henderson. During the year the company also sold its Sunshine Coast radio station, meaning results had to be adjusted to take into account the differences in earnings from that operation.

TV assets also remained challenged with the national operation’s revenue dropping to $106.3m, down $2.4m on FY13, and regional down $1.8m to $83.3m.

Operating costs were up 3.2 per cent, with net debt of $594.4m, down $11.8m, however the company did win a tax dispute which saw it receive a $26m rebate.

In the results outlook the Commonwealth Games has given TV revenues a “good start”, however last year’s boost from the Federal Election in September will mean revenues are down between 2-5 per cent for the first quarter. National radio revenues “remain challenging” and are expected to be between 3-6 per cent down foe the quarter.


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