Reuters logo
UPDATE 1-Australia's Nine network beats prospectus in first results, outlook "subdued"
August 28, 2014 / 1:15 AM / 3 years ago

UPDATE 1-Australia's Nine network beats prospectus in first results, outlook "subdued"

* 2014 net profit A$144.2 mln vs prospectus A$139.5 mln

* Warns ad revenue will drop 5-10 pct in Q1

* Shares down 7 pct after results (Recasts on advertising warning, share decline)

SYDNEY, Aug 28 (Reuters) - Recently-listed Australian television network Nine Entertainment Co Holdings Ltd on Thursday warned advertising revenue will fall and it will experience “subdued” earnings in the current financial year, prompting a sharp slide in its shares.

The country’s oldest TV network said advertising revenue would drop up to 10 percent in the first quarter of this financial year because of higher spending before last year’s Federal election and lower spending since May’s Federal budget.

“In light of the soft (free-to-air advertising) market over the first quarter of the new financial year, first-half results are likely to be subdued,” it said, although it expects to save A$20 million from a debt refinancing.

Excluding one-offs such as the costs of the initial public offering and December listing, Nine said annual net profit rose 5.5 percent to A$144.2 million ($134.71 million), compared with the prospectus forecast of A$139.5 million.

Including one-offs, net profit came in at A$58 million for the year to June 30, down from A$1.20 billion the previous year.

Nine shares fell as much as seven percent and were down 4.2 percent at A$2.01 by 0050 GMT, below their A$2.05 issue price and their lowest since June 13.

Nine and its free-to-air rivals Seven West Media Ltd and Ten Network Holdings Ltd are attempting to grow profit by cutting costs and ramping up their multimedia offerings as traditional viewers head online.

A day earlier, Nine said it was forming a joint venture video-on-demand internet service with newspaper publisher Fairfax Media Ltd to take on United States giant Netflix Inc before it enters the country.

The current financial year will be “a period of transition” for the network’s digital division, it said.

The company declared its first dividend of A$0.042, slightly bigger than the A$0.041 it forecast in its prospectus.

1 US dollar = 1.0704 Australian dollar Reporting by Byron Kaye; Editing by Stephen Coates

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below