Nine will look to cut $100m in costs over three years following a sharp drop in half year profit.
Nine reported a profit of $101.86 million, a drop of 41%, however revenues increased by 65.7% to $1.18 billion.
CEO Hugh Marks said: “This result is a testament to the work we have done over the last four years to reposition Nine for a digital future. With strong growth in our digital businesses helping to offset some of the cyclical headwinds faced by our traditional media assets. We have now clearly established Nine as the leading domestic player in the digital video market with both 9Now and Stan recording very strong growth in the period. Growth that we expect to continue into H2. We have successfully unified our first party database across all of our owned and controlled businesses, meaning we are in a position to offer our partners the benefits of more targeted advertising across the Nine suite of assets.”
But cuts will focus on international content including one-off sporting events such as the Ashes and Cricket World Cup.
Marks said these were “costs that will not inhibit our ability to continue to invest in the growth opportunities around premium revenue and digital video.”
Almost 40 per cent of Nine’s earnings were now sourced from digital platforms.
In 2019, Nine recorded its strongest year in OzTAM history. For Ratings Season 2019, Nine was the #1 Network and Primary Channel in all key demographics. In the December half, Nine also won all of the key demographics.
Stan grew its active subscriber numbers to more than 1.8m. The combination of ongoing subscriber build and the $2 price rise from March 2019 underpinned a 79% increase in revenue. Average weekly viewing hours per subscriber increased by more than 25% over summer weeks.
“Nine is in a unique, and incredibly exciting position,” Marks continued. “We own platforms across linear television, digital, print and radio – leading assets, and all of which are evolving towards digital distribution. Almost 40% of our earnings are now sourced from growing digital platforms. Together with data and technology, we have the ability to distribute messages to mass audiences as well as to small but valuable, addressable audiences. We have the systems to ensure seamless and efficient delivery for advertisers and we have the balance sheet to invest in the content that works for Australians.“