SCA blames 2DayFM for expected 10% ratings drop

Southern Cross Austereo (SCA) is blaming the departure of Kyle and Jackie O from 2DayFM for an expected 10% ratings drop on last year.

The statement posted on the Australian Securities Exchange (ASX) predicts its financial year earnings will fall short on last year’s $96.1m.

As the regional affiliate broadcaster for Network Ten (which brings in 70% of SCA’s TV revenues) and the owner of the Today Network and Triple M networks, SCA has said the outlook takes into account the country’s “softer advertising market”, its investment in promotions across the metropolitan radio network, as well as Channel Ten’s failure to build audiences with shows like The Biggest Loser and 2DayFM breakfast’s radio ratings struggle after losing Kyle and Jackie O.

Kyle Sandilands and Jackie ‘O’ Henderson parted ways with the Today Network in November last year to join KIIS-FM, a station owned by US radio conglomerate Clear Channel. KIIS-FM launched as a rebrand of the Australian Radio Network (ARN)’s MixFM.

KIIS-FM came out on top with the first Radio Ratings Survey this year; the Kyle and Jackie O Show tied at #1 with fellow ARN station WSFM, hosted by Jonesy and Amanda. The second Radio Ratings survey saw Kyle and Jackie O take the #1 spot for breakfast radio in Sydney with 10.9% share, while 2DayFM’s new team of Jules Lund, Merrick Watts and Sophie Monk took just 4.1% share.

SCA’s end of year prediction follows the sale of the Sunshine Coast Broadcasters Pty Ltd (Sea FM and Mix FM) for $17.75m in March 2013. However Mumbrella has reported the forecast slump should not affect SCA’s share price, which is $1.095 per share and puts its valuation at just under $800m.

The ASX report also mentioned SCA’s refinancing of its $765m syndicated debt facility in January 2014 secured financing for five years with no mandatory repayments. The report also said SCA’s Triple M network continues to “outperform” with growth over 2013.