“A Challenging Year”: Nine Records $575M Loss, Yet Audience Grows
Nine Entertainment Co. has released its FY20 results for the 12 months to June 2020, reporting revenue of $2.2b and a net loss of $575m.
According to Nine, the loss related to a post-tax Specific Item cost of $665m, largely relating to impairment of goodwill.
Nine also reported an EBITDA of $355m, down 16 per cent on FY19. On the same basis, net profit after tax and minority interests was $160m, down 19 per cent.
Nine CEO Hugh Mark said there was no doubt 2020 was “a challenging year” yet the media company was protected from the worst of the pandemic.
“The results of the strategic growth decisions we have made over the past 5 years, have played out at scale across the year and, as a result, sheltered us from the worst of the market impact of COVID-19.
“Our focus on the growth platforms in the market – primarily digitally based, and video-centric – has paid off.
“In the year to June 2020, the combined contribution from Stan and 9Now, the digital components of Domain and Publishing grew by 40%, to around 48% of our total EBITDA.
“Digital video consumption and subscriber revenue in particular, have grown significantly across the period, while digital advertising markets have improved more quickly as we trade through the worst of the COVID crisis.
Marks said Nine was quick to respond when the markets turned amid COVID-19.
“As advertising markets across all sectors came under pressure, we focused on significant short and long term cost initiatives across all of our businesses, successfully removing around $225m of cash costs in CY20, and setting in place the reduction of approximately $230m of long-term P & L cost from our business.
“As a result, the current market conditions have only given greater cause to continue to evolve the positioning of our business. Particularly the migration to digital – clearly evident across both our publishing and video assets.”
Marks said Nine will continue to drive its digital performance while maximising its traditional media assets.
“We are confident that this current period of adversity will only make us stronger,” he said.
“We believe we have the right strategy, the right assets and the right people, as well as a strong balance sheet, to ensure Nine’s position at the forefront of the media sector for many years to come.”
In a BVOD market, which grew by 31% for the year to $162m, 9Now held its share of 50 per cent, for revenue growth of 32 per cent. Growth in the underlying market slowed in the fourth quarter to 15 per cent, reflecting the broader advertising market momentum.
Live and VOD minutes increased by 49 per cent across the year on pcp, with total streams up by 44 per cent.
Overall, 9Now increased its EBITDA contribution by 36 per cent or $13m to $49m.
The acquisition of the minorities in Nine Radio (previously Macquarie Radio) was completed in November. The radio market generally had a difficult 12 months – the metro radio ad market declined 20 per cent across the year, and 30 per cent in the second half.
Across the two halves, Nine’s revenues declined by 16 per cent and 29 per cent respectively, given specific operational issues during the year. Full year costs declined by 8 per cent or $8m, reflecting one half of merger synergies, supplemented by broader cost out initiatives. Nine Radio reported EBITDA of $10m, or $6m.
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