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TEN loss of $8m amid “under-performing” entertainment slate

TEN has posted a first-half loss of $8 million as its CEO cites an under-performing entertainment slate.

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Hamish McLennanNetwork TEN has posted a first-half loss of $8 million as CEO Hamish McLennan cites an under-performing entertainment slate that has not performed beyond the Winter Olympics.

TEN’s reported net loss after tax was $8 million, with earnings before interest and tax at $2.601 million.

After tax the loss was $4.75 million, compared with $239.8 million in the previous corresponding period, however that included nonrecurring charges of $244.8 million.

Total earnings before non-recurring items, interest, tax, depreciation and amortisation was $10.056 million. Revenue increased this half year by 4.4% to $315 million.

“Our television revenue growth was ahead of the growth rate for the capital-city free-to-air television advertising market during the six months to February 28,” CEO Hamish McLennan said.

“That result was driven by the successful launch of the KFC T20 Big Bash League, which gave TEN its best summer ratings since 2008, and the XXII Olympic Winter Games in Sochi, Russia.

“But, as expected, the increase in revenue did not off-set the investment in critical new content.

“The increased costs reflect our investment in the KFC T20 Big Bash League and the morning television programs that were launched in November 2013.

“Strict cost control is part of TEN’s DNA and we will continue to find new ways to work smarter and more efficiently. At the same time, we will make prudent and strategic investments in content to execute our turnaround strategy.”

The television advertising market remains “short, with limited visibility,” he said.

As TEN struggles to rebuild in the ratings, McLennan acknowledged the network’s entertainment slate has under-performed, with unspecified “ageing” domestic franchises now under review. This comes despite TEN’s best opening week for the ratings survey since 2009, thanks to the Olympics.

He cited MasterChef, Offspring and Commonwealth Games as upcoming programming highlights with News remaining a focus. But there was no specific mention of the performance of breakfast and morning shows, which have entailed major costs.

“We have consistently said that it will take time to improve TEN’s ratings, revenue, earnings and returns to shareholders,” he said.

“Strict cost control is part of TEN’s DNA and we will continue to find ways to work smarter and more efficiently. At the same time, we will make prudent and strategic investments in content to execute our turnaround strategy.”

Earlier today TEN appointed its chief financial officer Paul Anderson as chief operating officer.

Asked about further appointments to TEN executive team he said, “In this industry and this country the good talent is either locked up or they’re few and far between.

“We’re always looking at ways we can supplement the senior ranks of the business.”

TEN is currently embroiled in a legal stoush with Seven Network after plans to hire programmer John Stephens were derailed.

McLennan indicated TEN would continue to focus on Event TV, including premium sport, aimed at people aged 25 to 54.

26 Responses

  2. @ Jason
    I feel that Channel Ten will invest some profit for a bid to secure rights for 2016-2020 Olympics as well as the 2018 Commonwealth Games. Channel 9 has made a huge financial loss of $45 million when they had the rights to broadcast the 2010-12 Olympics. If Ten can increase share price, then the network station can purchase the rights to broadcast the 2016-20 Olympics as well as the 2018 Commonwealth Games. At least Channel TEN can be a much bigger Event TV than the Nine Network. Nine has ruined not just Vancouver 2010 Olympics, but also the London Games.

  4. We actually watch TEN quite a lot, including The Project every night. Someone below said they dish up all the same old, same old .. what’s endless showings of NCIS, CSI, Big Bang Theory, How I met my Mother etc.etc.etc., if not also the same old, same old?? Everyone does it.

    I welcome the return of Masterchef, it’s a dream show compared to MKR which is just dragging on and on, getting worse by the week. Yet it rates its socks off, which demonstrates the tastes in TV of the Australian public. Which is no taste at all. The crasser the show, the more they watch it.

    I despair.

  5. I think TEN’s drama is the strongest out of the three commercial stations – Australian made and American. I think the problem is the marketing, that TEN have not, for a long time, publicised their shows as well as, say 7. The promos for the shows on 7 and 9 seem to be neverending and they then stick in your mind. In Canberra, for example, there is constant radio advertising at the end of the day (5-6pm) about whatever show they have on that night, be it MKR or something else (I don’t watch much of 7 so don’t know what else they have!)

  6. @Shoudy Chen – TEN won’t pay what the IOC is demanding. Neither will 7 or 9. As for “making a profit” from the games, remember 2012? “The Nine network was staring at a loss of up to $30 million, but estimates from media buyers and networks said Nine could now be facing a $40m write-off”.
    And how will they “make a profit this year”?

  7. Ten can only stagger their shows to match Seven and Nine if they have strong lead ins, otherwise you just increase viewers timeshifting your shows.

    The key bits were McLennan conceded that “I thought we would do better” because it was a very poor result and unlikely to improve significantly.

    That Ten would do less outsourcing of programming and take “smaller bets on programming” because “some [of the] shows that do really well are … some of the cheaper ones”. Which means that McLennan’s target of buying a 25% share of ad revenue has been quietly buried and they will be aiming to become a low cost network targeting more like a 20% share.

  8. I’m not convinced the project should change timeslots. The project has higher ratings from 7pm then 6.30pm so it doesn’t make sense to move it. Having a consistent show at 7pm is a good idea. I’m sure that’s why channel nine moved a current affair rather than random reality. Channel ten needs to fix the 6pm timeslot and put anything besides repeated imports. I don’t watch modern family anymore because I got tired of the repeats. Looking forward to offspring and 24. Hopefully they don’t bugger up the timeslots for those. In the case of 24 they don’t leave too long a delay between airing in the US and showing on ten. It would also be nice to have a breather between MKR and masterchef. It feels like MKR is never going to end.

  9. If the CEO highlights the upcoming Masterchef as a highlight its going to be a pretty dire year – MC is going to do just as badly as TBL this year!

  10. Ten have exception dramas but the 6-8:30pm timeslots have struggled for a very long time. They need to get rid of 6pm repeats, move The Project to 6pm, kick off their reality shows from 7pm to get the jump on 7 and 9 and make sure their strong drama lineups begin on time.

    They have by far the best hour long news but people switch the channel in droves once 6pm repeats begin.

    Trying a news bulletin at 9:30pm with Sandra Sully would be interesting.

  11. Ten needs to be smarter with scheduling decisions. e.g. Monday night Seven and Nine had their shows overrun presumably to avoid people flicking over to Ten to check out Secrets and Lies. Likewise with Seven’s Sunrise running late against Studio 10. Ten needs to respond accordingly and shift their schedule to suit. Yes, it can be annoying, but 7/9 are taking advantage of 10’s weak position, but 10 doesn’t seem to be fighting back.

  12. We are all great programmers in hindsight.

    Their drama slate is good but lead ins……well a different story.

    Get rid of Modern Family repeats at 6.00 pm , put on The Project at 6.00 pm with a heavy cross plug to Neighbours at 6.30 and plug say Masterchef at 7.00 pm.

    Bring back say Australian Idol but with a twist, if you could get two of the American Idol judges with 2 Australian judges……I really do not know but go out on a limb.

    Secrets and Lies was good but not great, too much emphasis on poor old Ben!

  13. Please win the rights to broadcast the 2016, 2018 and the 2020 Olympic Games as well as the 2018 Commonwealth Games. At least they can make more profit for this year. Don’t let Nine bid for the Olympics.

  14. What are the longest running reality TV shows on air(consecutive years)? Biggest Looser and Masterchef would have to be it. And TEN wonder why they are struggling in resent years. They are tired formats…..especially BL.

  15. I don’t get why Ten’s programming has failed to fire so spectacularly. Their reality slate generally is produced really well (I’m still a loyal Masterchef and Biggest Loser watcher, though didn’t care for their Renovators experiment), they do invest in Aussie drama and have a decent raft of imports. Is it just the marketing?

  17. IMO there’s just nothing fresh or exciting in Tens schedule. Apart from Puberty Blues and Secrets and Lies its mostly same old same old. I would like to see them offer a point of difference to reality shows at 7.30, and program more competitively later in the week. It just seems like they are making the same obvious mistakes with their programming decisions.

  18. Ten has never created a lot of top rating local TV, a few mini-series and game shows is all. Ten was the most profitable station buying US dramas and the franchises to Idol, BB, Masterchef etc.

    They have neither the talent or money to match Seven and Nine at those games.

    The BBL won’t have make much money this year but with proven record of drawing 800k people they will be able to charge more for ads in it and make money next year. It has been their one success recently.

  19. For once there is not too much exec bs.

    They are underperforming

    The key is not how long it will take to turn ch10 around, but whether they will survive. Advertising dollars are moving away.

  23. “News remaining a focus”. Interesting comment seeing that a once very credible news service is being white-anted from within – Sunday night news lead in “The Bolt Report” – it’s no wonder very few are watching and if the inclusion of Steve Price’s “analysis” in the lead story on Eyewitness News a couple of nights ago is a sign of things to come, then the focus on News is going to become very blurred very quickly.

  24. As opined by a financial analyst on ABC24 today, TEN’s problem is that ABC, 7 & 9 make and air programs that people want to watch, as opposed to TEN who makes and air programs that people don’t want to watch. Their problem, he submitted, was the top 20 people who make the decisions. They all need to go.
    As reported earlier, TEN even has a “Head of Comedy”, and a “Comedy Team”. What on earth do they do all day?
    I can’t believe how many people Network TEN employs, compared to the early days when they were independent stations, producing their own programs at North Ryde and Nunawading, not farming shows out to Fremantle, Shine, etc., etc.
    Also, don’t buy sports events that you can’t sell at a profit. Sochi, BBL, etc., all flash-in-the-pans for a slight, short-term ratings increase.

  25. I think Wake Up’s days are numbered unless it starts to improve. Studio 10 on the other hand has great potential and is improving, I think it will see out the year and beyond.

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