Seriously, TEN profit drops 70%.

TEN Network Holdings has reported a sharp plunge in first half net profit that came in below market expectations amid tough advertising markets.

The network said today net profit for the six months to February 29, 2012, fell 70.1 per cent to $14.8 million, compared with the prior corresponding period. The result was well below market consensus of $22.6 million.

Revenue fell 10.9 per cent to $432.7 million.

“Advertising markets were soft, particularly in late 2011 and early 2012,” Ten Holdings’ Chief Executive Officer, James Warburton said.

“The difficult state of advertising markets is reflected in our results for the six months to February 29. These results, however, reflect the benefits of the Operational and Strategic Review that took place last year, in particular around cost disciplines, and the ongoing efforts to create a strong platform for Ten Holdings.

“The turnaround of Ten Holdings is continuing. Our focus is on the broadcasting fundamentals of ratings and revenue. We are making good progress on both fronts, but the full benefits of the turnaround will take some time to filter through to results.”

TEN says Television costs for FY 2012 are expected to be approximately 5% or $30 million below the prior year, including a $14 million reduction in program costs due to onerous sports contract provisions incurred as at August 31, 2011.

The poor results follow major cost-cuts under interim CEO Lachlan Murdoch, prior to Warburton’s commencement at TEN.

“Ten Holdings’ cost base has been reduced. The evening news and current affairs strategy has been refocused. ONE has continued to show strong audience and revenue growth since it was relaunched on May 8 last year,” Warburton said.

“This year we are seeing good audience growth with our 5pm to 8pm strategy and with our Super Sunday program line-up, which has had an immediate impact.”

“The foundations of our prime-time schedule have been re-set. Now we will build on those foundations, slot by slot, program by program.

“We have built a new executive leadership team in a short space of time. That team is now completely focused on improving the performance of Ten Holdings.”

He also flagged more investment in production, including in-house productions.

“Implementing the strategy we have for Ten Holdings will require vision and patience,” he said. “A key element of that strategy is increasing our share of television revenue by focusing on selling excellence and building the CONNECT coalition, our cross-media marketing platform.

“Other key elements include producing more top-rating local television shows that we own, and reinforcing TEN’s unique brand principles.”

But the earnings announcement comes as the company continues to face a poor showing in the television ratings and a decline in its advertising share – taking only one quarter of the revenues booked through agencies, compared with shares of about 33 per cent for Nine and 40 per cent for Seven.

Source: news.com.au, smh.com.au

11 Comments:

  1. Why do they have two presenters being paid lots of money for their 5 o’clock news in Melbourne, then Mike Larkin presenting the weather always away from the studio, that must cost a bit, and when he is away they get that other guy to do it and he just reads the same info, could save money there as well, as for the inane and waste of time The Project! oh, is Carrie all of a sudden showing cleavage she never had before? saw the end this morning of last nights show, she did look differentI do however like the new morning breakfast show on 10 and so to my male friends, especially the weather presenter

  2. No surprise when their line-up sucks, they treat good shows poorly and viewers even worse. They’ve become so obsessed with hi-technology and forgotten how to broadcast basic television.

  3. i’m kinda suprised by this, they had one of the highest rating shows with Masterchef, still i suppose one show does not make for overall ratings winnings & therefore profits. With all the problems people are complaining about, re programming, its not like Ten are the only ones, Nine are worse in that dept, plus they rely on endless repeats of a certain 2 comedy shows im sure i dont need to point out. So i wonder if its more poor advertsing sales management that is more the problem.

  4. I couldn’t agree more with Bazza.

    The other thing I find is that if I try and do a series record on a show, they’ll do something annoying like adding “new episode” to the title in the EPG which means the show won’t record.

    Also, when shows I like suddenly disappear I will “acquire” them by other means. What this means is that not only am I not watching the network that ditched the show, all networks are losing out as I’m not watching free to air TV.

    I think they’re just plain stupid.

  5. Yea good call Brazza. I think there needs to be a reform on tv in Australia much like the recent afl tv deal where channel 7 have to show all games live there needs to be an air date timeframe. If this pushes the price of shows up then fta and foxtel may need to share the rights to some shows, ie. foxtel air it live same day and fta when they were planning too. You can’t really blame the networks for what the government let them get away with. For example in 2013 we are going digital and yet not all fta stations are available on paytv this will have a small impact. I personally have iq and only watch what’s on there. But I suppose that’s an argument for another day. But I would very much like too see whats happened with channel 7/fox footy agreement translated into paytv in the coming years. This way if a show airs out of ratings in aus they can air it live on foxtel but when ratings are back they could do a few double headers. Either way what’s happening with survivor shouldnt happen in 2012. I fact this day an age 1 week delay should be the absolute minimum.

  6. It’s a very simple formula to make money – dont play rubbish quality television that turns people away ……. then you’ll make money ….

  7. Let’s see…

    1) EPG is not kept up to date, nor accurate. All other channels offer minute accurate EPGs 2 or more days into the future. Ten’s EPG is never minute accurate on weekends and is rarely updated to reflect last minute changes.

    2) Series are regularly pulled if they do not rate well on their first or second airing! No time is given for the viewer base to grow and no loyalty is shown to viewers.

    3) Series are regularly “paused” mid-season, with no indication when they may return. By the same token, episodes are often shown out of production order.

    4) Series are frequently moved randomly around the timeslots, making it next to impossible for the casual viewer to catch them. If you begin a series on a channel in a given time, at least have the decency to continue it there until completion. Also do try to bring it back in the same timeslot next time, people have better things to do than chase shows around.

    There’s probably more, but those are my chief gripes. 9 is guilty of a number of them as well, which explains why 7 is flogging both of them.

  8. “Our focus is on the broadcasting fundamentals of ratings and revenue.”
    Well, what else is there to focus on? Ratings bring revenue. Always have, always will. Ask Seven.

  9. I know the results are as a company as a whole but it would be interesting which divisions are actually proving to be a successful business model

    i.e What’s Eleven’s revenue and profit margin compared to ONE’s? Is TEN’s primary channel at this point operating at loss due to dismal ratings?

    Oh and James can rant on about foundations of the primetime schedule as much as he likes but things aren’t going to change as long as the clowns in programming can’t decide which night to air Glee on, or TBYG for that matter. Or even the Friday edition of TBL which became Thursday and now has vanished completely!!

  10. If viewers don’t trust Ten why would advertiser’s? It’s only going to get worse for Ten looking at their upcoming local productions. Their programming department has killed the network and needs to go starting with Mott. Why can’t Ten bosses see this yet everyone on this site says the same thing?
    No one’s watching Ten anymore, so advertiser’s are wise to stay away.

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