Southern Cross Austereo profits up, “outperforming the market”

Image: SCA Chief Executive Grant Blackley

An industry-wide weak ad market has not affected Southern Cross Austereo. Financial results for the half-year to December 2016 saw it post net profit up 11.8% to $48.5 million on revenue of $351.8 million.

The period saw a new TV program supply deal with Channel 9, which has already added to revenue flow.

The acquisition of TV and radio content production Authentic Entertainment and integration of its exclusive Australian sales representation for Vevo expanded its scale and digital contribution.

Metro radio revenue was up 3.5% from $121 million to $125.2 million in the corresponding period the year before. Operational expenses rose to $94.3 million while metro radio profits rose 4% to $30.9 million.

Revenue for regional radio grew by 2.8% from $84.2 million to $86.6 million. SCA combines its radio and TV regional operational expenses, which were up to $154 million from $123.7 million. Both radio and TV were hit with a one-off marketing expense of $1.4 million due to rebranding; these included reshifting 68 regional radio stations to Hit and Triple M.

SCA’s overall regional revenue rose 15% to $216.7 million, much of this attributed to its affiliate switch to Nine.

“These results demonstrate the depth and strength of a diverse media company that is outperforming the market in each of its categories,”Chief Executive Grant Blackley said.

“We have been systematically resetting SCA for success by focusing on our financial performance, our operational effectiveness in our existing businesses and investing in new growth opportunities that leverage our expertise in audio and entertainment.”

SCA has just signed a contract to divested itself of 45 transmission sites, selling the sites to Axicom for $12.6 million and renting them back in a long-term facilities deal. This move will impact positively in the next half year’s results.

The company expects full-year operating earnings before interest, tax, depreciation and amortisation to be at the lower end of its $177 million to $183 million guidance range.

SCA also expects revenue growth to be risen by the rebranding of Hit and Triple M, and new formats across metro radio.