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TVNZ REPORTS LIFT IN AFTER TAX PROFIT


3 September 2012

 

Television New Zealand today reported an increase in After Tax Profit for the year ended 30 June 2012 – from $2.1 million in the prior year to $14.2 million.

Advertising revenue was $313.7 million, up $9 million on the prior year and TVNZ increased its share of television advertising revenue to 62.2% from 61.6% in the prior year and secured 92% of the total market growth for the 12 months ended 30 June 2012.

Underlying earnings of $27.9 million decreased by just under $4 million on the previous financial year.  Increases in the cost of television programming, particularly overseas programming, were the primary driver of lower underlying earnings.

TVNZ Chief Executive Kevin Kenrick says the result is a satisfactory outcome and reinforces the company’s position as New Zealand’s leading Free to Air broadcaster and digital media company.

“Both the network’s Free to Air channels exceeded their commercial targets this year, driven largely by strong local content on TV ONE and the continuing success of TV2, which has now held the lead in its targeted demographic  of 18 to 39 year olds for an unbroken run of 44 consecutive months”, he said.

The strength of the network’s content was reflected in the annual Top 20 list – 17 out of the 20 most popular shows during the year came from TVNZ.

 “TVNZ Ondemand has also shown strong growth and distribution of the platform is currently being extended to devices such as Apple iPads, Samsung Galaxy Tablets, and  Samsung smart TVs once testing is complete,” Mr Kenrick said.

During the year the company signed a joint venture deal with SKY TV for Igloo, a new pay platform due to launch shortly in which TVNZ holds a 49% interest.

It also ceased transmission of digital channel TVNZ 7 on the expiry of Government funding.

TVNZ won a number of top industry awards.  For an unprecedented fourth successive year, ONE News won Best News at the annual AFTA awards, and for the second year in a row the company was named by specialist recruitment & HR service provider Randstad as one of the top three most attractive employers in the country.

Mr Kenrick says TVNZ is embracing the need to adapt and keep pace with media industry changes and has embarked upon an update of its strategic direction to determine how it will continue to deliver the most compelling content for New Zealanders and expected financial returns.

The after tax profit of $14.2 million includes the impairment of assets held for sale and impairment & remediation costs associated with the switching off of the analogue transmission service for broadcasting television signals.  The results also reflect a share of associates relating to the start-up operation costs of the Igloo joint venture

This year, a dividend of $11.3 million will be paid to the Shareholder.   As in prior years, non-cash impairment charges were added back to the after tax profit when the Board declared the dividend from this year’s operating results.

The Annual Report is expected to be tabled in Parliament in early October.

 

Contact details
Megan Richards
TVNZ Corporate Affairs
021 804 123

 

 

Financial Highlights Summary - Year   Ended 30 June 2012

 

 

 

 

 

 

 

   

FY2012

FY2011

Variance

Variance

 

   

$'000

$'000

$’000

%

 

   

 

 

 

 

 

Operating revenue

   381,837

   377,896

3,941

1.0%

 

 

 

Advertising

  313,687

  304,666

9,021

 

 

   

 

 

 

 

 

Operating expenses

  (353,913)

  (346,085)

(7,828)

 

 

 

   

 

 

 

 

 

Underlying earnings

     27,924  

     31,811  

(3,887)

-12.2%

 

 

   

 

 

 

 

 

Interest expense

        (1,618)

        (2,702)

1,084

 

 

 

   

 

 

 

 

 

Asset impairment and

remediation expenses

        (5,663)

                0

(5,663)

 

 

 

   

 

 

 

 

 

Financial Instruments

            856

           (457)

1,313

 

 

 

   

 

 

 

 

 

Share of results of associates

/impairment

        (2,050)

      (17,674)

15,624

 

 

 

   

 

 

 

 

 

Income Tax

        (5,242)

        (8,898)

3,656

 

 

 

   

 

 

 

 

 

Net Profit after tax

     14,207

       2,080

12,127

583.0%

 

 

   

 

 

 

 

 

Dividend

     11,287  

     13,828  

(2,541)

 

 

 

   

 

 

 

 

 

Operating cash flow

     33,750  

     44,682  

(10,932)

 

 

 

   

 

 

 

 

 

Capital Investment

         7,641

         7,539

102

 

 

 

   

 

 

 

 

 

Investment in Igloo

     12,250  

                0

12,250

 

 

 

   

 

 

 

 

 

Total assets

   243,381

   228,690

14,691

 

 

 

   

 

 

 

 

 

Debt

     10,000  

     10,000  

0

 

 

 

 

 

 

   

 

 

 

 

 

Shareholders equity

   154,635

   154,281

354