Nine up on share buyback
UPDATE 2.25pm: Shares in Nine Entertainment surged after it joined the raft of companies announcing share buybacks with their first-half results.
This morning, Nine unveiled a first-half profit of $88.8 million, which was in line with its previously issued guidance range but down 6.7 per cent on the previous corresponding period.
The television broadcaster’s first-half profit was achieved on revenue of $829.2 million, off 1.9 per cent on the previous corresponding period.
Nine declared an interim, unfranked dividend of 4.2 cents a share to be paid on April 17.
Nine also announced a $150 million share buyback up to a maximum of 10 per cent of its issued capital.
Chief executive David Gyngell described Nine’s result as solid, given a difficult advertising market.
“We are confident about our schedule for 2015 and see a clear path to our 40 per cent revenue share target,” he said.
Mr Gyngell said the share buyback was made possible by the company’s sustained conservative leverage and strong underlying cashflows.
“We continue to look for ways to enhance our relative market positioning and shareholder value through innovation and acquisition,” he said.
Nine is in a fierce battle with rival free-to-air network Seven Television for viewing audience and advertising market share, with the other player, Ten, trailing a distant third.
Seven Television – part of the Seven West Media group which also publishes the The West Australian – is the market leader claiming 40.4 per cent of the commercial television advertising revenue market in the latest industry figures, ahead of Nine’s 39.2 per cent and Ten’s 20.4 per cent.
Nine’s TV first-half revenue came in at $645.5 million, down 0.6 per cent compared with Seven’s $677.2 million, down one per cent over the same period.
Nine’s first-half financials showed its EBITDA declined by 11.7 per cent over the period to $131.8 million, against Seven’s 4.9 per cent fall to $181.7 million.
Nine’s costs were $500.4 million, up 2.7 per cent, while Seven’s were $484.6 million, up 0.7 per cent.
Shares in Nine were up 17.5 cents, or 9.43 per cent, to $2.03 at the close.
