Southern Cross Media suffered a 17 per cent drop in revenue in its first outcome since merging with Kerry Stokes’ Seven West Media, even because the newly mixed group reported diverging fortunes throughout its portfolio.
Southern Cross Media Group (SCA) and Seven West Media (SWM) delivered robust earnings development in audio and speedy viewers positive factors in streaming, whereas tv income continued to say no, underscoring the uneven efficiency throughout the merged enterprise.
The info
Seven outperformed a declining free-to-air promoting market within the first half, with complete TV income down 2.7% in comparison with an estimated market contraction of round 10%. Nevertheless, earnings nonetheless fell sharply, with Seven’s EBITDA down 28.7% for the interval.
The outcome underscores the structural strain going through linear tv. Whereas broadcast TV stays worthwhile, earnings are more and more fragile as promoting markets soften and viewers shifts speed up.
Against this, SCA’s audio division delivered income development in a declining metro radio market, indicating market share positive factors. Broadcast radio margins improved to 27.5%, reflecting the affect of cost-out applications alongside modest top-line development.
The mix of income development and disciplined expense administration drove disproportionate revenue positive factors in audio, positioning the division because the group’s strongest earnings contributor within the half.
Streaming platforms additionally recorded robust top-line momentum.
Seven’s 7plus reported income development of 15%, with viewers development of 55% and streaming minutes up 62%.
SCA’s digital audio platform LiSTNR lifted income 14% and generated constructive EBITDA of $2.8 million, in comparison with close to breakeven within the prior corresponding interval.
Throughout at this time’s earnings name, competitors within the digital audio market was raised immediately. Lulwah Al Saleh, Govt Director of Wealth Administration at UBS Saudi Arabia, questioned SCA CEO John Kelly concerning the present disruption within the area, notably amid Spotify’s enlargement into video podcasts.
In relation to LiSTNR, Saleh requested: “How are you fascinated with the fixed step up in competitors on your listener and the chance of continued reinvestment into the tech stack?”
Kelly stated the newly merged group would supply larger distribution leverage.
“LiSTNR is an owned and operated property. And we are able to pivot and develop LiSTNR to fulfill the wants of advertisers. However we’re additionally very enthusiastic about utilizing seven plus as probably a video distribution device shifting ahead, which with 15 million signed up listeners of viewers into seven plus, that’s an enormous alternative to broaden that two and a half million sign-up base for Listener.”
The query displays broader shifts in viewers behaviour.
Latest information from PodPoll 25, carried out by Deadset Studios and analytics agency Insightfully, reveals audiences are more and more shifting away from conventional podcast apps and in the direction of streaming platforms. The nationally consultant survey of three,768 Australians aged 15 and over discovered Spotify is now the main podcast platform, utilized by 58% of respondents. Apple Podcasts has fallen to only one in 5 listeners.
YouTube has seen the biggest rise, with 44% of listeners saying they use the platform for podcasts, up from 30% in 2024. Youthful audiences specifically are gravitating towards video podcasts, strengthening YouTube’s foothold within the sector.
Nevertheless, regardless of LiSTNR’s speedy development, digital stays inadequate to totally offset declines in broadcast tv earnings. Seven’s complete EBITDA fell 28.7%, reflecting the continued weight of linear TV throughout the earnings combine.
Heith Mackay-Cruise
CEO steps down as board accelerates technique
The outcomes had been delivered alongside a management reset.
Late yesterday, the corporate confirmed Managing Director and CEO Jeff Howard would step down, with Chairman Heith Mackay-Cruise shifting into an expanded operational position as Interim Govt Chairman.
Opening this morning’s earnings name, Mackay-Cruise addressed the management change.
“The board recognises these bulletins are vital. However in our view, following a interval of main change, our two market-leading firms efficiently merged to type a serious media platform firm. The adjustments we’ve introduced are supposed to speed up the supply of our technique and place the corporate to maneuver extra rapidly and realise the advantages of our merger. This can embrace accelerating initiatives to drive income and value synergies, and to create new options for SCA prospects, together with by means of progressive use of knowledge.”
Through the name, Morningstar Australia’s Director of Fairness Analysis, Brian Han, requested whether or not the administration adjustments mirrored “an untenable disagreement on easy methods to combine the merger or the long run imaginative and prescient of how TV and radio companies will go collectively” and whether or not bringing in a brand new administration workforce was the one option to execute that technique.
MacKay-Cruise’s response was temporary and direct: “Sure”.
Taken collectively, the half-year outcomes and govt reshuffle underline the size of transformation underway. Audio is presently driving earnings development. Streaming is increasing quickly. Tv stays worthwhile however underneath structural strain.
