TVNZ interim profits take 51% hit

Wednesday 24th February 2010

TVNZ, New Zealand's state owned television and digital media company, announced a 51% drop in after tax profit compared to the previous year, from $18.3 million to $8.9 million, when it released its interim half-year results for the period to December 31.

The company said the decline was attributed to a slump in advertising revenues over the period, which fell 12.7% or $22.2 million year-on-year.

The broadcaster reported a slump in pretax earnings for the period, from $27.7 million to $14.2 million year-on-year, a drop of 48.7%.

TVNZ Chief Executive Rick Ellis noted that while cost reduction initiatives have offset some of the impact of revenue declines, the company was still looking to adjust its on-going cost structure to the revenue realities of the post-recession era. He said it is likely the year end results will be a loss.

"There are a number of strategic reviews underway across the business as the company looks to further reduce costs, and to make the transition from an analogue broadcaster to a digital television and media company. These will be substantially completed by the end of the fiscal year," said Ellis.

One bright spot in the interim results for TVNZ was the growth of its online business, said Ellis, with a 174% growth in advertising revenues. The company has yet to provide detailed accounts.

During the half year period, the company expanded its sales offering of television and online "bundles" which have been well received by advertisers.

Television performance was strong for both TV ONE and TV2, with TV2 in particular recording its highest ratings performance since 2003.

Full results are expected in March after they have been tabled before Parliament.

Businesswire.co.nz

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