ARN’s Half year profit down but Ciaran Davis predicts ‘better profit margins and further debt reduction’

ARN’s 2025 half yearly results were released this morning with revenue down 7% on 1H24 but, as was the case for SCA’s full year results on Monday, digital audio revenue was up 21%.

The network was succinct on the lay of the land.

The Gold Network is outperforming in the market with gains in commercial share and the national roll out of Gold 104.3’s The Christian O’Connell Show underway.

Regional markets are outperforming the metro.

And, the heavy investment in the KIIS Network and their star breakfast talent of Kyle and Jackie O is not meeting revenue expectations. New content and commercial strategies, which saw the layoffs of several back end staff as well as long time KIIS 1065 Content Director Tony Aldridge at the end of the financial year, occurred to drive share gain.

ARN have also hired a new COO, Michael Stephenson poached from Nine, and CFO, Alexis Poole, who replaced Andrew Nye at the start of this year.

Alexis said in this morning’s presentation that positives were a strong cash performance, reduced debt by 12% and unlocked capital with the sale of Cody assets. ARN still holds shares in SCA after their failed takeover bid that were mentioned as ‘part of our liquid asset base.’

Half year revenue was $142.3 million, down 7% from $152.8 million in the previous corresponding half year period.Digital revenue grew by 21% helping offset declines in Metro (-12%) and Regional (-5%) revenue. Costs rose by 3%. The company made a $1.8 million profit for then half year form continuing activities, but, when discontinued operations were taking into account, the company made a loss.

ARN CEO Ciaran Davis said:
“Leadership and digital capability has been strengthened, with the appointments of a new COO and CFO and a restructure of the Commercial Team. We’re better equipped to execute our strategy and transition from our broadcast to a digitally driven content and commercial model.

Digital Audio has seen strong growth in revenue, margin, and EBITDA.

We maintained our dominance of podcast content and our partnership with iHeart brings benefits across audience engagement, commercial opportunities, and data capabilities, with exciting developments to come in H2. “Our ambition is clear: to build Australia’s most profitable audio entertainment business. By streamlining operations, maintaining strong capital discipline, and reinvesting in areas that create long-term value, we are making strong and deliberate progress toward that goal.”

A couple of other ARN developments on the horizon. The organisation will do their own upfront presentation to advertisers for the first time this year. They have previously been a part of similar CRA events.

An iHeart upgrade will be launch in October along with new digital products with the aim of “driving share gain.” Radioinfo shared a story earlier this month about the rebranding of DAB+ station iHeartAustralia to KIIS Australia which appears to be the start of this upgrade.

The dividend of 1.2 cents per share, is 66% of profit returned to shareholders.

ARN shares (ASX:H1T) briefly spiked as the results were announced, but then fell back the monthly average as investors digested the results (click the diagram for the live share price).

The full HY reports and accounts can be found here: https://investors.arn.com.au/news-releases/news-release-details/presentation-2025-half-year-result