Southern Cross Austereo has hailed its sharpened “all audio” strategy, reporting solid FY25 growth as digital platform LiSTNR turned profitable for the first time.
Revenue rose 5 per cent to $421.9 million in FY25 while underlying EBITDA climbed 34 per cent to $71.1 million – impressive results that CEO John Kelly has put down to the audio company’s renewed focus as an “all audio” business.
Speaking to B&T, SCA CEO John Kelly said the divestment of television assets, with expected proceeds of $19-$24 million, had cleared the way for a singular focus on audio.
“We’re now all about audio. Some time back, we had a view that the growth in audio is very much going to come through digital audio, through streaming and podcasting. That view remains absolutely in place. I often claim that we are the fastest growing player in the fastest growing sector in Australian media, and that’s digital audio, and that’s LiSTNR”.
The biggest milestone came from LiSTNR, which delivered positive EBITDA for the first time. Digital revenue jumped 28.8 per cent to $45.1 million, with Kelly confident this is just the beginning.
“We’ve now reached scale. We’ve got 2.5 million sign-ups. We’ve got good audience levels. We’ve got a great array of content and business partners supporting LiSTNR. The ad tech that we’ve invested in provides attribution and targeting, and allows us to compete with big tech… I’m very confident we’re going to see continued growth in the digital audio revenues”.
Kelly stressed LiSTNR’s local credentials as its competitive edge. “Spotify has global content… but do they have any hyperlocal content? I don’t think so. As the world goes global, localism becomes even more important. We’re investing in podcast properties which are proudly Australian, whether it be sport, entertainment, culture or factual”.
The results were also powered by cost discipline. Non-revenue related costs fell $6.7 million to $263.5 million, while net debt dropped nearly $40 million to $67.6 million. This balance sheet strength allowed the board to declare a fully franked four-cent dividend, up from one cent last year.
According to Kelly, a lot of the cost-cutting has come from non-revenue-generating sections of the business, with the ad-sales business and content remaining relatively unaffected.
“We’ve done a lot of the hard work, particularly in the back office, where efficiencies could be generated. We’ve very much tried to leave alone both our revenue-generating activity and content, because we think that is our future,” said Kelly.
Looking ahead, SCA has guided FY26 revenue in the range of $435–$440 million, with EBITDA forecast between $78–$83 million. Digital audio growth is expected to remain in double-digits, while capital expenditure is set to stay under $10 million.
A Potential Sale?
The results come amid industry chatter about potential consolidation in the media sector. Reports suggest Nine Entertainment has held exploratory discussions about acquiring SCA following its $3 billion sale of Domain.
Any transaction would be complex, with Nine needing to divest its talkback radio assets in Sydney, Melbourne, Brisbane and Perth to comply with media ownership rules. However, observers note that Nine’s interest underscores the growing strategic importance of FM and digital audio assets, which are seen as better placed than AM talk stations to evolve in a multi-platform future.
Kelly declined to comment on the matter but said that, in the past, the audio company has been quoted in support of media consolidation for Australian companies. “We continue with that viewpoint. We think it suits both, is required and will happen in time,” he said.
“Our focus for the last two or three years has been becoming the best audio company we could become in terms of our transformation journey and being fully focused with LiSTNR at the heart of our ecosystem. Quite clearly, we’ve been successful, as indicated by the results today. It’s therefore no surprise that there may be interest from Nine or any other domestic or international player”.
“We think we’re a very valuable and growing asset that’s refurbished, digitised and fully set for future growth. We think we’re a best-in-class digital audio asset. So we’re not surprised [by speculation], but we’ll see what happens down the path”.
