Key Points:

• The Edge to go national as a 15-29 youth format
• Advertising returning to normal, but still weak in Entertainment and F&B
• Live streaming the next growth driver
• Integration of Grant Broadcasting stations going as expected
• 4KQ sale to be completed by last quarter of this year, several interested parties
• Digital audio consumption and broadcast radio are complimentary

ARN’s parent company HT&E reported good results in today’s annual results presentation.

After the presentation CEO Ciaran Davis spoke to radioinfo from his car about the results and the company’s growth strategy for the coming year.

Why from his car? Because Cairan Davis is also personally feeling the effects of Covid. One of the members of his household has covid and he was driving home to isolate for 7 days.

Davis says it is a good result for his company but also for the whole industry. “The good news about this result is for the radio industry… revenues were similar to 2019, which is the benchmark… radio audiences continue to grow and with revenues returning there will be a lot more growth for the industry in the coming year.”

Businesses are still dealing with staff shortages or supply issues so some bookings have moved into March and April, but Davis is confident that business is returning to normal. Some key categories such as entertainment and food and beverages are still feeling the effects of covid, “but thankfully with borders opening and restrictions easing these things will come back to normal. This can only be good for radio advertising,” he said.

While broadcast revenue is still by far the majority of ARN’s revenue, the company is also looking to the future by building its digital revenue.

“We’re doing a very good job showing the engagement of audiences with content… as an industry we have to keep proving that.”

ARN’s audience studies are showing that digital audio consumption and broadcast radio are complimentary. Audiences are still listening to broadcast radio at the peak times that they always did, but they are now also listening to iHeartRadio podcasts at other times, such as in the later afternoon, early evening and on weekends.

“We talk to clients, they understand that radio is unique, it’s something that you do when you’re doing something else, you’re in the car, going for a walk, you’re at the gym or home or office… then we talk about digital revenue without cannibalizing radio.” He sees digital growing further over the next 2 years and the company is investing in more digital resources and content than ever before.

Davis believes that podcasting and live streaming will drive new revenue growth. While podcasting is evident, live streaming offers new opportunities for measurement and targeted ad insertion as more people listen to broadcast streams on smart speakers.

The other growth strategy for ARN is to target younger audiences with the expansion of The Edge format. ARN will relaunch The Edge as a national youth brand distributed on iHeartradio, broadcast radio and DAB+, with hip hop and RnB music and youth culture content for 15-29 year olds. It is expected to launch nationally in the last part of this year.

Davis said that the departure of Mike E and Emma from the Edge’s previous Sydney breakfast show was a mutual decision when the pair heard about the new direction for the station. He is glad they have stayed together and have a new gig.

“The Edge is really well liked but we know that if we were just to relaunch it with the old radio model it would not achieve what we want… we researched a lot around that demographic, we recruited specialists who are familiar with providing content to that age group, we also recruited commercial people who have spent time working with the target audience at a partnership level… it’s about creating content that can be consumed across all platforms and building a new audience.”

The expansion of The Edge, plus the integration of the former Grant Broadcasters into ARN Regional is expected to bring an expanded audience offering for advertisers beyond the successful metro stations that the company already operates.

For the sale of 4KQ, Davis says there are several interested parties “in the high single figures” who have signed NDA agreements and are now beginning exploratory discussions with ARN about the sale.

Listen to the full interview below.