Nine reports $157m profit

Nine Entertainment Co. has reported a profit of $156.7 million, up 26.8%, thanks to strong earnings from its television operations and growth of its digital businesses.

Revenue for the year to June 30 was up 6.5% to $1.32 billion. Expenses before EBITDA was up 25% to $257.2 million.

Metro free-to-air television advertising recorded 2.5% growth for the year, the first year of growth in four years. A commercial share of 38.2 per cent of the 25-54 demographic, was buoyed by titles such as Married at First Sight and The Block.

Revenue for Nine Digital, which includes PedestrianTV, CarAdvice & Future Women, rose 7.2% to $165.8 million. 9Now grew its registered user base to about 6.5 million. Stan recorded more than 1.1 million active subscribers, with revenue up 72% to $100 million, despite a cost increase of 23%.

Full-year figures exclude $53 million of special items, which primarily consist of the profit on the sale of Nine’s headquarters at Willoughby as it looks ahead to a base in North Sydney.

Hugh Marks, Chief Executive Officer of Nine Entertainment Co. said: “The strong operating performance from last year continued across our entire suite of assets. Positive Free To Air TV ratings momentum combined with our focus on the 25-54 yr demographics is translating to improving revenue share.

“In Digital, 9Now is experiencing strong revenue growth and our digital publishing business has reported accelerating growth in premium revenues in line with our strategy. Stan has raced through the milestone of 1m subscribers and remains focused on the build of a longer term competitive and profitable local SVOD player.

“The proposed merger with Fairfax will enhance our ability to continue to grow our business for the benefit of all shareholders. The increasing scale of the merged group will expand both our advertising reach and ability to offer innovative solutions, backed by data and Nine’s Galaxy platform. The combined reach of the group’s expanded media assets will enable an acceleration in the growth of the Domain business. While Nine’s ability to invest in and expand what will be Australia’s largest News platform, across television, radio, digital and print is also incredibly exciting.”

Nine expects group earnings to be between $280 million and $300 million in 2018/19. This week Seven West Media also reported a $136 million profit.

The Australian Competition and Consumer Commission is set to hand down its decision on the Fairfax Media takeover on Thursday 8 November.

Nine noted the following highlights:

· Consistently improved ratings performance – 25-54s Network share of 38.2%1
· #1 revenue share for the 12 months of 38.6%2, up 2.9 points on pcp
· Group-wide costs up 1%, ex the newly introduced spectrum charge and impact of the extra trading week
· More than doubling of profit at refocused Digital business (ex Bing)
· 90%-plus growth in long form streams resulting in c90% growth in revenue at 9Now
· 1.1m+ active subscribers at Stan currently, growth of c40% over the 12 months
· 5.0 cent final dividend, for full year total of 10.0 cents, fully franked
· Year end Net Debt of $121m resulting in Net Leverage of 0.5X

Source: AAP / SBS, B&T