Australia’s media conglomerate, Nine Entertainment, has announced a significant drop in its annual profit, leading to a reduction in dividends and concerns about the advertising market.
Nine Entertainment, listed on the ASX, has reported a net profit of AUD 181.8 million for the twelve months ending June. This represents a sharp decline from the AUD 297.1 million profit recorded in the previous year. While revenue remained stagnant at AUD 2.70 billion, a 7% increase in broadcast costs negatively impacted the bottom line.
The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA), excluding one-off items, stood at AUD 591.2 million, consistent with its guidance range of AUD 590 million to AUD 600 million provided in May.
In light of the weaker financial performance, Nine Entertainment’s directors have decided to reduce the final dividend to 5.0 Australian cents per share, down from 5.5 Australian cents in the previous year.
When non-controlling interests and one-off items are taken into account, Nine Entertainment reported a net profit of AUD 279.0 million. This figure exceeded the average analyst forecast of AUD 267 million, based on revenue of AUD 2.72 billion.
Despite the challenging advertising market conditions persisting into early fiscal 2024, Nine Entertainment remains confident that its business segments are outperforming the wider industry. The company expects to continue outperforming the broader ad market over the course of fiscal 2024 while gaining additional market share.