Ad market picking up, says NineOn 01/31/2019 by admin
A pickup in the advertising market has given Nine Entertainment confidence about lifting its first half profit.
Nine chief operating officer Simon Kelly says that while Nine has had a challenging start to the 2014/15 financial year, there was an improving trend in the ad market in the second quarter.
While Nine expects the market will record an overall decline for the first half, it believes there will be modest growth in the final six months of the year.
“Against this backdrop, we are confident we will deliver ratings and revenue share improvements and we will deliver on our full year television cost inflation guidance of plus one to two per cent before the cost of the Cricket World Cup,” he told shareholders at Nine’s annual general meeting on Wednesday.
Mr Kelly said Nine expected to lift its first half net profit to between $85 million and $90 million, excluding a one-off profit of about $5 million on the sale of its HWW business.
Nine’s first half profit for 2013/14 was $31.679 million.
Mr Kelly also forecast a 10 per cent rise in full year net profit.
Nine in August announced a full year pro-forma net profit of $144.2 million, up 3.4 per cent on its prospectus forecast.
Its statutory net profit was $58 million, down from $1.2 billion.
Mr Kelly said based on Nine’s free-to-air market growth assumption of one to two per cent in the second half, Nine expected its underlying earnings for the year would be at least in line with the $311 million reported for 2013/14.
He said Nine’s bottom line would benefit from about $25 million in interest cost savings as a result of its new debt facilities.
Mr Kelly’s optimism about the ad market comes two weeks after News Corp boss Robert Thomson reported “green shoots” were taking hold, with car and real estate ad sales particularly strong.
Fairfax has also reported that its Metro newspaper revenue falls had moderated.
Nine’s shares were 1.5 cents higher at $2.065 at 1114 AEDT.