Nine has released its FY20 results for the 12 months to June 2020. On a Statutory basis, Nine reported revenue of $2.2bn and a net loss of $575m, which included a post-tax Specific Item cost of $665m, largely relating to impairment of goodwill.
On a pre AASB16 and Specific Item basis, Nine reported Group EBITDA of $355m, down 16% on the Pro Forma results in FY19 for its Continuing Businesses. On the same basis, net profit after tax and minority interests was $160m, down 19%.
Key takeaways include:
- Audience growth across all key platforms – Metro Publishing, Stan, 9Now, Radio and FTA
- Strong growth from digital video businesses, including $51m EBITDA improvement at Stan, with current active subscribers of 2.2m; and 36% growth in EBITDA at 9Now to $49m, with market leading BVOD share of 50%
- Ad markets heavily impacted by COVID-19 from March 2020
- Nine was quick to mitigate the associated fallout with $225m cost-out program – cash basis, CY20; including increasing and expediting previous cost initiatives
- 40% growth in digital EBITDA to $166m ($178m post AASB16)
- Evolution of Metro Media business to consumer focus, with reader revenue now accounting for 59% of total revenue
- Strong balance sheet, with (wholly-owned) leverage ratio <1X1 like-basis, pre AASB16
Hugh Marks, Chief Executive Officer of Nine Entertainment Co. said: “2020 was no doubt a challenging year. The results of the strategic growth decisions we have made over the past 5 years, have played out at scale across the year and, as a result, sheltered us from the worst of the market impact of COVID-19.
“Our focus on the growth platforms in the market – primarily digitally based, and video-centric – has paid off. In the year to June 2020, the combined contribution from Stan and 9Now, the digital components of Domain and Publishing grew by 40%, to around 48% of our total EBITDA. Digital video consumption and subscriber revenue in particular, have grown significantly across the period, while digital advertising markets have improved more quickly as we trade through the worst of the COVID crisis.
“On COVID more broadly we were quick to respond when the markets turned, transitioning the majority of our work-force to `work at home’ with minimal interruption. As advertising markets across all sectors came under pressure, we focused on significant short and long term cost initiatives across all of our businesses, successfully removing around $225m of cash costs in CY20, and setting in place the reduction of approximately $230m of long-term P & L cost from our business.
“As a result, the current market conditions have only given greater cause to continue to evolve the positioning of our business. Particularly the migration to digital – clearly evident across both our publishing and video assets. We will continue to drive growth in our increasingly prominent digital businesses while, at the same time, maximizing the performance of our traditional media assets.
“We are confident that this current period of adversity will only make us stronger. We believe we have the right strategy, the right assets and the right people, as well as a strong balance sheet, to ensure Nine’s position at the forefront of the media sector for many years to come.“