Seven West Media reported that its profit before tax had dropped by as much as 49 per cent year-on-year.
The broadcaster’s H1 2024 financial results, released today, show a profit before tax of $79 million, nearly half last year’s profit of $156 million.
The broadcaster’s share price dropped by 11 per cent following the news.
Revenue was only down marginally year-on-year, falling 5 per cent to $775 million compared to $816 million the year before.
The fall was largely reflective of a trend in the total TV market which declined 9 per cent in the period.
This was driven by a 13 per cent decline in the metro market and a 5.5 per cent decline in the regional market. Bucking the trend was the BVOD market which grew by 12.5 percent.
Seven CEO James Warburton put the results down to “weakness” in the ad market.
“Our financial performance reflects the weakness in advertising markets, particularly as the second quarter progressed,” he said in a release.
Expenses Up Year-On-Year
Operating expenses were also up year-on-year rising to $651 million compared to $611 million in FY2023.
Seven said its costs were “in line with expectations” with the “majority” of content investment weighted to the first half of the year. It expects H2 FY24 costs to be lower year-on-year.
Cost-cutting measures in both content and operations have been implemented it said.
Advertising conditions remain “mixed” Seven said – retail trade and travel were “strong” whilst there were “weaknesses” in motoring and government spend.
Despite the drop, Seven’s revenue share was up to 41.0 per cent, up 1.7 points.
There was “strong” growth in digital audiences with unique monthly audience numbers up 18.5 per cent to 4.4 million.
A Focus On Content
Warburton said that Seven had executed its strategy during the period to deliver consistent and engaging content to drive audience growth and revenue share across the total TV market.
“We continue to believe in the power of television and firmly believe that the total TV industry is set to regain market share. Total TV is now growing, and Seven is leading that growth. Our view that audiences will be attracted to quality and consistent content across news, entertainment and sport is evidenced by the growth in our linear and BVOD audiences for the half year, including a linear increase of 2.2 per cent and a 35 per cent increase in minutes on 7plus”.
“Thanks to our audience growth, we were able to record a total TV revenue share of 41 per cent, achieving the number one position in the market, an increase of 1.7 points on the previous corresponding period. Our share growth was achieved across each month of the half and partially offset the 9.1 per cent decline in the total TV advertising market during the period. We gained share in metropolitan and BVOD markets and remained in line in our regional markets”.
“We see a significant opportunity to grow our digital earnings with the recent launch of VOZ finally pushing TV audience measurement into a comparable position versus other media channels”.
