ABS-CBN earnings drop in Q1 due to seasonal weakness

ABS-CBN Corporation, the country’s leading media and entertainment company, reported that its attributable net income dropped to R421.94 million in the first quarter of 2017 — about half of the R839.17 million earned in the same period last year.

Philippine Stock Exchange data showed, consolidated revenue dipped to R9.6 billion for the first three months of 2017 from R9.89 billion in the same period last year which had benefited from political ads before the elections.

ABS-CBN’s consumer sales grew by 10 percent to R4.7 billion while its first quarter airtime revenues were 13 percent lower compared to the same period last year.

According to ABS-CBN Chief Financial Officer Aldrin Cerrado, they did not expect a significant growth in earnings during the first quarter given the strong performance of the first quarter of last year.

“First quarter earnings tend to be lower than the subsequent quarters due to the cyclicality of advertising placements,” he added.

Meanwhile, Cerrado said they managed to reduce overall costs and expenses during the first quarter. “We expect costs to go down further as we replace some of the higher cost programs which were carried over from last year,” he said.

“We remain confident that we will meet our earnings target of R3.0 billion for the year,” noted Cerrado.

Star Cinema also generated close to R600 million from four movies released during the quarter. “My Ex and Whys,” which was released last February, brought in about R300 million in ticket sales.

Meanwhile ABS-CBN’s Group CFO Rolando Valdueza said “Sky saw an 11 percent growth in revenues to R2.3 billion driven by the continued increase in its broadband and DTH subscribers.”

As of end March 2017, Sky had 672,000 cable subscribers, 161,000 DTH (direct-to-home) subscribers, and 205,000 broadband subscribers.

“The strong growth in our broadband subscriber base, which has doubled in two years, should continue as we invest in expanding our network,” added Valdueza.

Valdueza said he is happy with the progress of the DTT initiative as they ended the last quarter with 2.7 million boxes sold since the service was launched in 2015.

Kidzania, the company’s educational theme park, also welcomed over 77,000 visitors since the beginning of the year, while the O Shopping Channel generated R240 million in sales of various products for the first three months of 2017.