Nine Profits Crash 35% As Sporting Costs Balloon – channelnews

Nine Entertainment posted a decline in net income for the first half of FY23 as investments in sports and other programming collide with declining advertising.

The network posted net income after taxes of $190 million for the six months ended December 31, down a significant 35.2 percent from its profit of $225 million for the same period in 2021.

Revenue rose 5 percent to $1.4 billion while EBITDA plummeted to $370.5 million, down 9 percent from $406.3 million in the same period last year.

The company announced a fully stamped interim dividend of 6 cents.

Net debt stands at $291 million after Nine spent $67 million to buy back 33 million shares as part of its repurchase program.

Nine Network, 9Now and Nine Radio saw segment revenue increase 5 percent to $715.8 million with EBITDA falling 8 percent to $223.5 million, which Nine attributes to “a series of one-off programming, which totaled around $20 million.”

Australian Open, rugby and UEFA rights aside, the expanded coverage of the Queen’s death contributed to these costs.

Split revenue for the Nine Network was $573 million, up 3 percent, with 9Now up 19 percent to $88.6 million.

Stan’s revenue increased 12 percent to $206.4 million, but expenses rose 17 percent to $188.5 million, with EBITDA falling 18 percent to $17.9 million. The bust was due to sports rights and increased investment in Sony programs and originals.

The publishing side was mostly flat, with revenue up 0.1 percent to $299.7 million and EBITDA up 2 percent to $96.1 million. Digital advertising fell 8 percent.

Domain reported a 19.2 percent decline in EBITDA to $46.3 million.

Looking ahead, Nine forecast that Total Television’s ad revenue percentage will decline in the “low-mid single digits” while its expenses will increase in the “low single digits” in the current quarter.

“We are very pleased with how Nine has ended calendar year 2022 with strong audience and share performance across all businesses, both subscription and advertising,” said Nine CEO Mike Sneesby (pictured above).

“Nine’s strategic focus on content investments has resulted in significant revenue share growth across all of our advertising media.

“As international streamers streamline investments, Stan’s strategic positioning in originals and esports, along with its strong licensed content, will benefit.”

Sneesby also said “the sport remains key” to his future growth and investments.

Nine stocks are down 4.6 percent this morning.