Macquarie Media Group (MMG) has announced a final distribution of 3.2 cents per share for the six months to 30 June 2009, bringing the total distribution for this financial year to 7.7 cents per share. The result is disappointing for shareholders when compared with the past two years of dividends, which amounted to over 40 cents per annum in the previous two financial years, but is not surprising given the current financial crisis and “demanding advertising conditions.”
The board is following a new distribution policy announced last December, which will determine the distribution for each six month period “based on the specific needs of the business at that time.” The dividend represents a payout ratio of 26% of Proportionate Earnings, after the deduction of maintenance capital expenditure of 2.1 cents per share.
MMG owns the Macquarie Southern Cross Media group of regional radio and tv stations in Australia, and regional US newspaper group American Consolidated Media.
Chief Executive Mark Dorney has told investors:
“MMG’s businesses remain well positioned despite demanding advertising conditions experienced over the last twelve months. As we outlined on 7 May 2009, MMG’s media businesses saw a tougher advertising market in the second half of this financial year.
“Macquarie Southern Cross Media’s (MSCM) local advertising revenues were impacted by a further softening in retail conditions in the second half of the financial year. Despite this, MSCM’s radio businesses maintained strong ratings and market positions, and MSCM TV achieved improved relative ratings performances. Significantly, over the financial year to date, MSCM radio
has also continued to outperform the metropolitan radio market in terms of local advertising revenues.”
American Consolidated Media is facing a “tough external environment” according to Dorney, who believes the actions initiated in the last 6 months leave MMG well placed and flexibile to meet the current “challenging economic and credit market conditions.”
MMG will announce its financial results for the year ending 30 June 2009 on Thursday 20 August 2009. The company’s Distribution and Dividend Reinvestment Plan remains suspended at this time as announced previously.
The MMG share price dropped to a low of $1.36 on news of the dividend announcement.
Read the radioinfo report of last year’s 47 cent dividend at the link below.