SCA profit soars 91.6% thanks to cost control & Government stimulus

Editor & Content Director

Southern Cross Austereo (SCA) is the first cab off rank, with the broadcast company revealing its financial performance to the market today.

Its net profit after tax (NPAT) including significant items was $48.1 million, up 91.6% from last financial year’s $25.1 million. Excluding the significant items, it was up 40.7% from last year.

A snapshot of SCA’s results (A full breakdown can be found at the end of this article) 

Asked whether the results were actually good – or if the growth seemed significant due to a dire year last year – CEO Grant Blackley said it was a “combination of both, to be honest”.

“Firstly, I think we’ve seen a very strong recovery in the market to such a point that you’ve got nine out of 10 major [advertising] categories all in double-digit growth now, recovering from the depths of COVID last year, and the market is just responding to that and obviously we’re getting the benefit of that,” he told Radio Today.

“And the other half of this as well is that we have spent the best part of 18 months reimagining the network, reimagining the contribution by each of the segments within our business at SCA, and how we can create a more effective and efficient operating model, coupled with an investment with our digital audio segment, that as we’ve seen today, revenues have grown by 40% and we expect that they will grow by a further 75 to 100% over the course of the next year.

“So I think it’s a combination of both.”

The results revealed that revenue for the metro radio business declined 5.5% over the course of the 2021 financial year, compared to FY2020. This was attributed to a decline in the metropolitan free-to-air radio advertising market, which was down 2.4%. The sharpest decline was in Melbourne (down 5.5%), followed by Brisbane (down 2.4%) and Sydney (down 2.2%). Perth and Adelaide were up 2.9% and 2.1% respectively.

Regional radio revenues declined 2.7%, but revenue from national agencies was up 10% on the year prior.

Digital revenues grew to $15.4 million, a 40% increase.

Overall audio revenue dropped by over 3% to $359.7 million.

The company’s improved profit and EBITDA (earnings before interest, tax, depreciation and amortisation) was thus primarily put down to cost control and Government stimulus.

SCA benefitted from $31.9 in Federal Government JobKeeper payments in the financial year, and received $8.6 million from the Public Interest News Gathering (PING) program.

These payments reduced its employee expenses from the financial year from what would have been $188 million to $147.6 million. Last financial year, employee expenses were $192.5 million, which with $16.1 million in JobKeeper, fell to $176.4 million.

Blackley took home a total remuneration of $1.692 million, up from $788,641 last year. The increase was driven by the award of 50% of his short-term incentives, compared to 0% last financial year. He also had 25.2% of his performance-related proportion, compared to 0% last year.

Chief sales officer Brian Gallagher also took home a significantly larger pay packet – $771,929 compared to $426,051 the year prior. And chief content officer, Dave Cameron, had a total remuneration package of $555,572.

The company’s net debt was down 59.8% from $132 million at the end of last financial year to $53 million.

SCA said its balance sheet is now robust and it has healthy liquidity. It is now in a position to pay a dividend of five cents per share.

In a media release about the results, Blackley said the increased NPAT and EBITDA, as well as its historically low debt levels, put it in a strong position to invest for the future.

Its investor report also revealed a new corporate strategy, which you can read about here.

SCA’s full financial results 

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Recent comments (16)
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Is it income if you didn’t earn it?
18 Aug 2021 - 12:39 pm

So removing 40.5 million in government handouts, that really should have been returned they made a 7.6 million profit, down from 25?

Harry Hardon
18 Aug 2021 - 1:01 pm

Hope it is paying back the $31.9 million in Job Keeper. Its just another example of a company that cried poor and didn’t need to. Amazing what a bit of a crisis does to cleaning up the books and incentivising management to perform.

SCA Executive's Salaries BTW
18 Aug 2021 - 2:04 pm

SCA gets rid of heaps of staff. SCA benefits from Jobkeeper and uses it to
restructure. SCA high fives itself for becoming profitable. Nice one.

Sorry but...
18 Aug 2021 - 3:31 pm

‘Cost Control’ AKA understaffing their stations and overworking the people they’ve kept on, firing all regional radio announcers and syndicating shows that barely rate… 😐 not sure how this will work long term.

Ex-Regional announcer with no money or prospects and who is far from family cos Covid
18 Aug 2021 - 4:05 pm

Cool, can I have my job back now please?

Yuck
18 Aug 2021 - 7:22 pm

So grant pocketed the collective wages of all the fired regional announcers? Good stuff

Bryce donaldson
18 Aug 2021 - 8:13 pm

Cost control? Yeah like rebranding products every second week?

Pffft .. smoke and mirrors result.. let’s be honest, without jobkeeper heads would of rolled.

Another Ex-Regional announcer with no money or prospects and who is far from family cos Covid
19 Aug 2021 - 1:27 am

Crazy that there are more of us, glad they made some cash though!

Former passionate regional employee
19 Aug 2021 - 6:27 am

The top brass didn’t sacrifice getting a payrise at all did they?

Used government money and reduced hours to pay a bunch of Frontline staff during Jobkeeper, then sacked them as the entitlement for the scheme wound up despite a number of them having solid functioning roles looking after radio regionally in the company.

Waited 6 months then went mad hiring sales people.

One of the companies to unashamedly promote the fact they profited after the first thick of COVID.

Mike
19 Aug 2021 - 7:46 am

Taking a government hand handout called “job keeper” so people can “keep” their jobs and then once they get the cash they make people redundant anyway. Then announce a profit. What a disgrace !!

Gavin
19 Aug 2021 - 8:54 am

What a mess. Wonder how much went into “re-branding” and marketing the legacy stations they had “re-branded” barely 18 months ago…

Rob
19 Aug 2021 - 9:29 am

I wonder if Dave Hughes ever feels a bit guilty because he got paid 2 million dollars in a pandemic and rated 3%.

nick
19 Aug 2021 - 10:44 am

Dead set – the comments on this thread are more entertaining than the 2DayFM Morning Crew.

SCA Employee
19 Aug 2021 - 11:55 am

Remember when SCA paid us for 3 days of work a week last year, but still had us doing 5 days worth of work in those 3 days?!

Cause I fucking do!! Give me money back you cnuts!!

someone who took a pay cut
20 Aug 2021 - 9:07 am

so Grant and Brian had bonuses / pay increases of a total $1.249,237. How many peoples jobs could have been saved had they just taken the same as the year before.

None of the everyday staff got pay rises – they took cuts and had to be grateful to still have a job. Absolutely appalling!

Ex-SCA lackey
20 Aug 2021 - 3:49 pm

Reading all these articles about what was once a great place to work after leaving there 7 years ago and I think……..man I made the best decision

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