Nine has its mojo back
Network reaps benefits of higher ratings
NINE Entertainment shares have rallied to their highest level in more than two years as the broadcaster reaps the benefit of higher ratings.
The parent of the Nine Network yesterday posted a net profit of $174 million for the six months to December.
That marked a sharp turnaround from the $237 million loss it suffered a year earlier, when the group – which also has investments in various online businesses – wrote down the value of its free-to-air operation.
Nine said that during the six months to December overall free-to-air advertising spending rose for the first time in more than two years.
Its share of that revenue increased to 40 per cent, the group said.
Nine said it expected its strong ratings performance to continue in the second half of the financial year – the six months to June – and its revenue share to be higher than in the same period a year ago.
But it warned growth would be limited by the impact of the Winter Olympics and Commonwealth Games on rival Seven Network.
Despite the warning, shares in Nine surged 16 per cent to $1.97 after the results were published, to their highest level since 2015.
The company’s underlying profit, which excludes one-off costs, was $116.2 million for the half – up from $75 million a year earlier. Its net profit included earnings on the sale of its Sydney headquarters.
Chief executive Hugh Nine Entertainment chief executive Hugh Marks told analysts it was a strong half year across the entire business Marks said it was a strong halfyear across the entire business.
“Television is changing but it presents big opportunities for those who can adapt and we at Nine are leading that change,” he told analysts.
“We will continue to invest in our future – there is much work still to do but as can be seen from these results, the benefit to our shareholders is becoming increasingly clear.”
Nine expects its strong ratings performance to continue in the second half of the financial year, and its revenue share to be higher than in the same period a year ago.
Nine’s digital business, which includes on-demand streaming services, also chalked up revenue and earnings growth in the first half.
Nine declared a fully franked interim dividend of 5¢, up from 4.5¢ a year ago.