Seven West Media reports profit

 

Seven West Media has turned a net profit of $116.4m for the six months ending December 26, after cutting costs and reducing debt.

Seven West Media Managing Director and Chief Executive Officer, James Warburton, said: “This has been a very big year for Seven, with several major milestones achieved as we continue to re-position the business. “Our new content strategy is firing, with a significantly improved ratings share and a more attractive demographic profile. We secured the leading share of audiences in broadcast and BVOD in the half. Our new tent poles are delivering on average 75 per cent more audience than the old content strategy. This will translate to higher revenue share in the coming 12 months.

“The market is showing positive signs of recovery with strong growth in the second quarter and forward bookings are looking positive for the third quarter.

“Our digital transformation can be seen in the success of 7plus, which has had a phenomenal year. Its revenue was up 79 per cent in the period versus market growth of 44 per cent. Seven’s total digital EBIT grew 168 per cent to $32 million in the period.

“These strong operating performances have been delivered after a radical transformation of the cost base. The c$170 million gross cost out remains on track and we have identified another $30 million of cash savings.”

He added, “Seven is set up to benefit from the recovery underway in the advertising market. Our new content line-up is drawing larger audiences and, importantly, improving our demographic mix in prime time. We are determined to monetise those results in 2021 and are targeting a material increase in revenue share.

“7plus was the #1 commercial free to air TV platform in 2020 and we’re targeting the #1 revenue share spot as well.

“The digital platforms enquiry is well underway, and we are pleased to see progress being made to ensure a fair return on our investment in news content.”

Meanwhile Seven has also announced a deal to provide news content to the Google Showcase which launched in Australia in early February.

Seven West Media Chairman Kerry Stokes AC said: “This is a great outcome for Seven West Media and for Google. Our new partnership recognises the value, credibility and trust of our leading news brands and entertainment content across Seven and West Australian Newspapers.   

“I’d like to thank Prime Minister Scott Morrison and the Chair of the Australian Competition and Consumer Commission, Rod Sims, with particular recognition of Treasurer Josh Frydenberg, who has been instrumental in the outcome of this ground-breaking agreement. 

“Their outstanding leadership on the implementation of the proposed News Media Bargaining Code has resulted in us being able to conclude negotiations that result in fair payment and ensure our digital future,” he said.

“The negotiations with Google recognise the value of quality and original journalism throughout the country and, in particular, in regional areas. 

 “Google is to be congratulated for taking a leadership position in Australia and we believe their team is committed to the spirit of the proposed code.”

A Letter of Understanding will be subject to executing a long form agreement within the next 30 days.