Chairman Russell Tate estimates MRN has lost between $1 to $1.5 million dollars from the campaign against Alan Jones‘ advertisers.
Speaking at the Macquarie Radio Network’s annual general meeting today, Tate said:
“We will never know the actual cost of this episode – some bookings were cancelled, some were deferred and some were moved to other time zones on the station. A total of 15 only advertisers have advised us that they do not intend to advertise on 2GB again, from a total of 647 individual advertisers in the ALan Jones breakfast show in the prior 12 months and a total of 209 individual advertisers in September alone.
“Our best estimate of the profit impact to MRN is somewhere between $1 million and $1.5 million in the current half year period. We are confident that in the second half of the year there will be minimal if any residual impact”
On the impact of the failed 3MTR joint venture he told the meeting:
“MTR was always going to be a big challenge. The Board nevertheless, and in hindsight foolishly, accepted my recommendation back in late 2009 that we risk some of the significant earnings gains we were achieving through our Sydney stations in an attempt to establish a foothold in the Melbourne market by launching a second news-talk station there. In total this failed venture into Melbourne cost MRN $5.5 million in the 2011/12 year and a total of $12.675 million (before tax) overall.”
The company’s earnings for the 6 months to December 31 were impacted by the events surrounding Alan Jones in October, as well as the Sydney radio market’s contraction on the prior year (2.2% down for the 4 months to October) and lower than expected recovery of expenditure from the Olympics broadcasting rights, according to Tate.
“Our expectation at this time is that the underlying earnings (EBITDA) for the 6 months to December 2012 will be around the $6 million mark, a 36% decline on prior year underlying levels. The half year reported result will however improve by over $1m (an increase of over 30%) largely due to the absence of the loss making MTR,” he said.
To read his full address to the AGM, click here, and see the company’s annual report here.