SCA earnings fall 12.8% despite continued growth of regional assets

Southern Cross Austereo has reported a drop in EBITDA of 12.8% in its end of financial year results for 2017/18, despite the strong performance of its regional TV and radio properties.

The results also saw a 5.3% fall in revenue to $654.1m, with the report citing “a year of transition and investment for the future”.

The falls came despite an increase in regional radio revenue, up by 4.5%, a seventh consecutive year of growth.

“This growth was supported by the continued education of national advertisers about our large and growing regional communities and a resulting improvement in their investment in regional markets,” said SCA CEO Grant Blackley.

Meantime, metro revenue rebounded into growth in the second half after being down 1.8% in the first, with aggregation of SCA’s FM and digital radio audiences in the five Metro markets adding over 300,000 listeners.

“Driven by stronger Metro ratings and launch of the digital radio monetisation strategy, SCA has taken positive momentum into the new financial year,” said Blackley.

“For the full year, group revenue was up 0.6% on a like-for-like basis.

“SCA’s unique strategy for monetising its digital radio assets provides a sustainable competitive advantage.”

Blackley also pointed to a strong performance by SCA’s regional television assets, as well as the emergence of PodcastOne, which has garnered 45 million downloads since launch in August 2017.

“Our premium curated original content is engaging new audiences and creating increased commercial interest,” he said.

SCA’s chief explained that efficiency will continue to be a core focus for the company moving forward.

“Under a new structure implemented from 1 July 2018, our core business functions of operations, content, sales, finance and corporate affairs, and technology have been aligned nationwide. This will enable us to further improve and streamline processes, communication flows and decision-making.

“We have also upgraded many of our back office support systems over the past three years. These investments will lead to better workplace planning, decision-making and effectiveness.”

In announcing the results, SCA flagged that the next financial year has begun on a positive note, with group revenues already 5% on the prior year (growing faster than expenses).