They say if you’re paying tax, at least you’re making money.
The same goes for government subsidies, if you’re not eligible, you must be doing ok.
ARN’s parent company HT&E has calculated that it will make enough money in coming months to exclude it from the Jobkeeper subsidy.
The first round of Jobkeeper payments were based on the first month of pandemic shutdowns. If a company could show that it had lost 30%-50% of revenue (depending on size) it was eligible for the subsidy until the end of September. But the second round of Jobkeeper salary subsidy payments will be based on monthly assessments, not just a one off eligibility test, so businesses that expect to make close to their normal earnings will no longer be eligible.
HT&E, with most of its radio stations in metro markets, has calculated its forward revenue will recover and expects that it will no longer be eligible because its revenue decline will be under 30%.
It is good news for HT&E and for the metro advertising market in general, indicating a slow return to normal business conditions. The company’s revenue decline was less than figures for the market average drop of 28.15%, released today.
CEO Ciaran Davis described the news as “encouraging.”
A statement to the stock exchange said:
HT&E Limited today confirms it will not be eligible for ongoing financial support under the extended JobKeeper program from 28 September 2020 to 3 January 2021.
ARN experienced improved trading conditions relative to the previous quarter, with total revenues down 22.5% on the prior year comparative period. This result was significantly ahead of the broader metro radio market, which was down over 28% for the quarter.
Early trading for the remainder of Q4 is encouraging with the possibility for further improvement on the previous quarter’s result should current COVID restrictions in Melbourne continue to ease in coming weeks, and other key metro markets remain unchanged.
CEO of HT&E, Ciaran Davis, said; “ARN’s trading is encouraging as we continue to gain commercial market share. The actions we have taken across the business this year have placed the company in a strong position to enhance our leadership as both the #1 national radio network and podcast publisher in Australia.”
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