Seven has announced job cuts as part of $105m in savings over the next two years.
At Seven West Media’s AGM today CEO Tim Worner announced $25m savings through “headcount reductions”, adding to $30m in cost savings already announced, to offset the step-up in AFL rights costs.
A further $50m in cost savings will be realised in 2019 from the roll-off of major sports rights, he said.
“Our financial results for 2017 reflect a tough market impacted by both structural and cyclical pressures. In the period we recorded material write downs in the carrying value of our television licenses and some of our content rights, which is a function of changing market conditions.
“It became evident that in light of this softer market outlook, some of our sports contracts, predominantly related to major one off events, will not deliver the level of financial return that was anticipated at the time of signing these deals.”
Chairman Kerry Stokes welcomed changes to media ownership laws but also addressed legal action taken against Amber Harrison, referring to her only as a “former employee.”
“Beyond confronting the challenge of change and identifying the opportunities to build your company, we have, over the past twelve months, been obliged to take legal action to protect our business from the release of confidential company information and to defend the reputation of our people and company,” he said.
“As detailed in two separate, successful NSW Supreme Court judgments, your company acted professionally and appropriately in the handling of a matter involving a former employee.
“I wish to assure you that our success over the past decade and the transformation of our business is built on a strong culture. It is a culture of inclusion and respect. There are always opportunities to improve culture and accountability and that will be a continuing focus.”
Last week Seven unveiled its 2018 Upfronts to advertisers and media in Melbourne including Olivia, Interview with Andrew Denton and major sporting events in the Commonwealth Games and Winter Olympics. Seven today said it expects underlying earnings for the 2018 financial year to be in the range of $220m to $240m.
“Operating conditions in the first quarter have been soft given the ad market and ratings performance in the period,” Worner said today.
“Despite this, we have in place one of the strongest content line ups in 2018 we’ve had in a while. We showcased our plans for 2018 to our customers last week and the feedback has been very positive.”
Seven West Media also announced the departure of Board member Dr Michelle Deaker after 3 years.
Source: The Australian