Aussie media firms to shine

  • Business
  • Wednesday, 27 Aug 2003

SYDNEY: A bounce-back in glitzy advertising campaigns is set to help drive full-year earnings up as much as 40% for Australia's biggest television, magazine and newspaper groups. 

Investors are now banking on Publishing & Broadcasting Ltd (PBL), Seven Network Ltd and John Fairfax Holdings Ltd giving an upbeat outlook for ongoing recovery of the sector when they report their profits over the next three weeks. 

“They'll be saying generally positive things, but I think they'll still be cautious. They'll be suggesting it's still a bit month-to-month, but in general the trend is rising,” said Scott Maddock, media analyst at fund manager BT Financial Group. 

Analysts estimate TV advertising spending in the June quarter was up 12%–14% on a year earlier, boosted by spending deferred over the Iraq war, increased advertising from heavyweight multinationals, and the return of long-dormant sectors. 

But analysts said the market remained patchy, with billboards, newspapers and magazines failing to fully reap the windfall. 

PBL, which is controlled by Australia's richest man, Kerry Packer, and owns the top-ranking Nine Network, Melbourne's Crown Casino and a stable of magazines, will be first out of the gate when it reports its full-year earnings tomorrow, followed by Seven Network on Sept 3 and Fairfax on Sept 9. 

PBL is expected to post a A$321.2mil full-year net profit, up 20% from A$268.2mil a year earlier, according to Reuters Estimates, as stronger second-half TV earnings and a healthy performance of its magazine division offset the negative impact of a slide in international tourist numbers and a smoking ban at its Crown Casino. 

Some analysts speculate that investors could receive a special dividend from PBL, which also said it would book a A$32mil one-off profit from the sale of its 2.3% stake in German sportswear maker Puma. 

Second ranked broadcaster Seven Network, which is 36% owned by TV tycoon Kerry Stokes and has online and magazine businesses, is tipped to post a net profit of A$80mil, up 23% from A$65.30mil a year earlier, according to analysts polled by Reuters. 

Few surprises are likely from Fairfax after Australia's second biggest newspaper publisher said this month stronger revenues and cost controls would push its net profit up 38% to A$125mil. 

Fairfax, which publishes the Sydney Morning Herald and Melbourne's Age broadsheets, said its costs and balance sheet remained “tightly under control” and publishing revenues had nudged up 4%. 

Third ranked TV broadcaster Ten Network Holdings Ltd operates on a financial year to Aug 31 and is forecast to post a A$54.4mil net profit when it reports its earnings in October, according to Reuters Research. 

That would mark a sharp turnaround for Ten, which posted a A$108.63mil loss last year when it wrote down goodwill related to its Eye Corp outdoor advertising business. – Reuters  

For more foreign business news click here

Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 1
Cxense type: free
User access status: 3

Did you find this article insightful?


Across The Star Online