HT&E Limited has released its results for the six months ending 30 June 2022.
The highlights are listed below:
The acquisition of 46 regional radio stations from Grant Broadcasters (ARN Regional) completed on 4 January 2022 is integrating to plan and performing above expectations delivering margin expansion.
The integration programme is ahead of schedule and continues to gather momentum with ARN Regional radio revenues up 11 per cent, delivering material cut through to EBITDA which is up 21 per cent.
Key milestones on the integration programme have been achieved and revenue synergies of over $2.7 million delivered, giving confidence to hit the $6-8 million target for 2022 outlined at the time of the acquisition.
The strength of HT&E in the local audio market continued, with ARN holding the #1 FM metropolitan radio network position in Australia for twenty-one consecutive surveys. Ratings leadership was also achieved in key regional markets of Gold Coast, Mackay, Cairns, Bundaberg, Ipswich, Darwin, Launceston, Gympie and Ballarat.
HT&E group revenues from ordinary activities of $172.0 million increased 58 per cent, and underlying NPAT1 of $24.6 million rose 69 per cent on the prior period, owing to the acquisition of ARN Regional.
On a like for like basis, assuming ARN Regional was part of the Group in the prior period, revenues and EBITDA were up eight per cent and one per cent respectively.
HT&E chairman, Hamish McLennan (lead image) said, “The business has delivered a very solid financial and operational result in a highly competitive market. Our strength in the Australian audio market demonstrates the success of our strategy and the acquisition of our new regional business delivers scale to drive further growth. ARN Regional is a high-quality asset for us and is proving to be a gamechanger for the company as it provides access to increasingly important and growing regional audiences, which enhances our ability to deliver content across multiple platforms and access more than a third of Australian consumers.
“We are confident of continued growth in regional markets in the medium to long term. Cost-of-living pressures in metro markets and changed work patterns through COVID have seen increased population movement to regional areas. Additionally, we are making good progress on the $6-8 million revenue synergy target for 2022 and the integration of the two businesses is well advanced.
“The Group remains well capitalised and maintains a robust balance sheet following the recent acquisition, with net debt of $78.4 million and leverage of under 1 times EBITDA.2
“In consideration of the solid trading result for the period and capital structure, the Company declared a fully franked interim dividend of 5.0 cents per share. We are also reinstating a buyback to support what the Board believes is an undervalued stock at a time when we continue to see growth in our advertising markets in 2022.”
HT&E CEO & managing director, Ciaran Davis said, “We have made exceptional progress integrating our regional business. It is a high-quality team that is producing outstanding results with clients and the momentum is building as we get to know the business and its people. The scale, speed and success of the integration program has exceeded expectations and the rationale for ownership is stronger than ever. Whilst our metro markets remain integral and underpin the business and our advertising offering, we now overlay that with a network of high-quality assets in some of the fastest growing regional markets in Australia. It is early days, but this is a very strong and exciting position to build on.
“Maintaining the #1 radio network position in Australia for twenty-one consecutive surveys with #1FM stations in Sydney, Melbourne and Adelaide is a significant achievement. The addition of ARN Regional provides access to new audiences and we are encouraged by continued strong ratings performance in key regional markets.
“We are in a privileged position where our core radio business is being enhanced by complementary new digital audio offerings. Digital audio is our future with radio at its core and we are successfully executing our strategy to build an audience and commercial bridge between linear and digital audio.
“We are investing $7-8 million of additional operating expenditure, with iHeart at the centre of our digital global platform technology, a high value digital asset where we have complete control.
“Our confidence stems also from the current high rates of podcast consumption, with 40% of all people listening to podcasts monthly3, overtaking podcast listening in the US for the first time. New investment is critical to capitalise on our leadership position in podcasting and to support the creation of CADA, our new national youth platform.
“Despite the current uncertain global macro-economic outlook, we remain extremely confident in our strategy and ability to successfully integrate ARN Regional with our existing business to create the leading metropolitan and regional audio business in Australia.”
