Nine Returns To Profit Ahead Of Fairfax Takeover

Nine Returns To Profit Ahead Of Fairfax Takeover

Nine Entertainment has posted some very positive results for the last financial year, as it prepares for a “very exciting” future with Fairfax Media.

The company delivered a statutory net profit of $209.7 million in the 12 months to 30 June 2018, swinging back from a $203.4 million loss the previous fiscal year.

Excluding one-off items, Nine’s net profit after tax was up a massive 27 per cent in FY18 to $156.7 million, and revenue increased by six per cent over the period to $1.3 billion.

Nine’s earnings before interest, taxes, depreciation and amortisation (EBITDA) was up 25 per cent to $257.2 million.

Looking at the company’s divisions, Nine Network experienced seven per cent revenue growth to $1.2 billion, with 23 per cent growth in premium ad revenue, and four per cent growth in other ad revenue.

Nine’s metro free-to-air advertising recorded 2.5 per cent growth in FY18 – the first year of growth for this market in four years.

As for Nine Digital, its revenue rose 7.2 per cent to $165.8 million, with 9Now delivering 89 per cent revenue growth, and digital publishing revenue increasing five per cent.

Nine’s streaming joint venture with Fairfax, Stan, has garnered over 1.1 million subscribers as of August, with subscription revenue up 72 per cent in FY18 and operating costs up 23 per cent.

Nine CEO Hugh Marks said the company’s strong operating performance from last year continued across its entire suite of assets.

“Positive free-to-air TV ratings momentum combined with our focus on the 25 to 54-year demographics is translating to improving revenue share,” he said.

“In Digital, 9Now is experiencing strong revenue growth and our digital publishing business has reported accelerating growth in premium revenues in line with our strategy.

“Stan has raced through the milestone of one million subscribers and remains focused on the build of a longer-term competitive and profitable local SVOD player.

Marks said Nine’s proposed takeover of Fairfax will enhance the company’s ability to continue to grow our business for the benefit of all shareholders.

“The increasing scale of the merged group will expand both our advertising reach and ability to offer innovative solutions, backed by data and Nine’s Galaxy platform,” he said.

“The combined reach of the group’s expanded media assets will enable an acceleration in the growth of the Domain business.

“While Nine’s ability to invest in and expand what will be Australia’s largest news platform, across television, radio, digital and print is also incredibly exciting.”

The Australian Competition and Consumer Commission is set to hand down its decision on the merger on Thursday 8 November, and has outlined its key areas of focus for the review.

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