Nine Entertainment has reported a full year loss of $592.1 million largely due to massive writedowns, and has forecast a fall in its share of market revenue.
A $792 million non-cash impairment charge dragged Nine into the red for the year to June 30, with a $101 million tax credit associated with the sale of Nine Live partially offsetting the writedown.
Underlying profit dropped 2.9 per cent to $140.1 million on a continuing fall in TV advertising.
Underlying earnings also dropped 7.6 per cent to $287.3 million, in line with June’s downgraded guidance of between $285 million and $290 million.
Chief executive officer David Gyngell said Nine’s ratings had improved during the first two months of 2015/16, but that its share of the free-to-air advertising market was still likely to decline.
“In what has been a difficult free-to-air advertising market, our June quarter share performance was short of our expectations,” Gyngell said.
“Nine’s ratings performance has improved markedly since the beginning of July, which is expected to underpin revenue share over the half.
“However, it is likely that full year share will be marginally down on that of FY15, given the intensely competitive market, coupled with the timing of certain major events.”
Nine said the metro free-to-air advertising market shrunk 1.5 per cent over the year and warned that, which it is expected to grow modestly in 2015/16, monthly outcomes were volatile.
The regional market declined 3.2 per cent and will continue to perform badly compared to metro.
Nine, which recently finalised the sale of its ticketing and events business and struck a $147 million deal to sell its Sydney headquarters, said it has been buoyed by its newly signed $925 million five-year NRL broadcast contract, which starts in 2018.
“Together with our expectation of improved affiliate terms, the expiry of loss making international programming commitments, and our industry leading debt free balance sheet, we are in a very strong position,” Gyngell said.
* Net loss: $592.1m vs $57.9m net profit
* Revenue: up 7.6pct to $1.4b
* Fully franked final dividend: 5.0 cents per share, up 0.8 of a cent.
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