After the surprise news of Southern Cross Austereo (SCA) Managing Director and CEO Jeff Howard‘s immediate resignation last night, the half year results for the newly merged SCA and Seven West Media (SWM) were perhaps less the focus than the question time afterwards.
Results in short:
- Half-year group revenue was $1 billion (1,023.8) for the businesses, down 1.5% from the previous corresponding period.
- Pro forma net debt of $338 million was reduced by $16 million.
- Pro forma earnings, before interest and tax, fell 14.4% to $106.9 million. Group expenses rose slightly to $901.2 million year-on-year.
- No interim dividend declared with the organisation focusing on debt reduction.
For audio:
- Metro radio revenue share of 29.8% was up 2.3 points year-on-year.
- Underlying expenses were down 1.2% with non revenue related costs down 2% from the previous corresponding period.
- Digital EBITDA up to $2.8 million, and cashflow positive.
- Underlying NPAT up 252% to $12.8 million.
Interim Executive Chairman Heith Mackay-Cruise was the first speaker of the results presentation speaking to the positives that Seven and 7Plus audience share, streaming minutes and percentage of tv revenue were up. He also extolled the virtues of the three West Australian newspapers that sit within the TV and audio assets of the company saying that print revenue is strong, they are “truly a national publications” with more than half of their readership outside of WA.
John Kelly, now the interim CEO – TV and Audio spoke to a “significant confidence in continued earnings growth in the audio sector” as well as opportunities for cross promotion of radio and LISTNR on Seven. A significant example of which was yesterday’s launch of The Agenda Setters: Rugby League.<
Toby Potter, the newly announced Chief Transformation Officer – TV and Audio but speaking from his former role as Interim Chief Financial Officer said the merger had created a “complex set of results” but that the underlying results are strong.
He added that broadcast radio revenues continue to demonstrate resilience. Share increases offset a decline in the radio revenue market with digital audio and podcast revenue becoming meaningful contributors to the company.
In the Q&A post the presentation, the resignation of Jeff Howard was addressed, with John Kelly asked if there had been a disagreement?<
Kelly replied:<
“This is about accelerating the speed of our strategy, that culminated in changes to the leadership team.”
He added of his new (interim) responsibilities which now include TV as well as radio:
“I was previously at TEN, I worked in finance there. I understand TV. I will work with all our teams how to get efficiencies in place across the year ahead. I’m excited about the year ahead.”
The SXL share price fell two cents by lunchtime on a small volume of sharesa traded.
Jen Seyderhelm is a writer, editor and podcaster for Radioinfo.
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