Southern Cross Austereo has posted a second straight year of losses as it continues to repair the damage caused by the loss of radio stars Kyle and Jackie O.
The owner of stations including 2DayFM and FOX FM, and the Triple M network, suffered a 20 per cent fall in earnings from metropolitan radio in the year to June, amid a weaker ratings performance.
That far outweighed a slight increase in earnings from its regional radio and television businesses, while $361 million in writedowns on its metro and regional broadcasting operations caused a $285 million loss.
Those writedowns reflect weaker assumptions of revenue growth in the metro radio business, due to subdued advertising markets and lower market share.
Since Kyle and Jackie O left the network for rival KIIS at the end of 2013, Southern Cross Austereo’s radio ratings have been weak.
Ratings have improved in recent surveys, however, and Southern Cross Austereo said its investments in content – the network’s star duo of Hamish Blake and Andy Lee returned to air in July – were delivering results.
But it admits more work needs to be done.
Southern Cross Austereo expects revenue growth of five per cent in the three months to September, compared to 12 months ago.
But earnings in the six months to December are expected to be similar to the $86 million achieved in the same period of 2014, due to higher content and marketing costs.
Mid-single digit earnings growth has been forecast for the second half of the 2015/16 financial year.
The company’s shares were up 1.5 cents at 93 cents.
RADIO WOES CONTINUE FOR SOUTHERN CROSS
* Net loss of $285m, compared to $296m loss
* Revenue down 4.6pct to $611m
* final dividend unchanged at three cents