Nine Entertainment has recorded a steep 31% slide in annual net profit to $134.9m in a challenging year for Australia’s biggest media company, which saw significant cuts to its publishing division and the departure of chairman Peter Costello.
Nine is still ahead of rival media company Seven West Media, which had full-year profits falling 69% to $45m.
Nine reported revenue of $2.6bn, in a financial year in which weaker economic and advertising conditions hit the broadcaster and publisher.
Up to 85 journalists, most of them senior, took redundancy from mastheads including the Sydney Morning Herald, the Age and the Australian Financial Review last week. Earlier this year, the company flagged up to 200 jobs would be cut overall in an attempt to cut costs.
The chief executive Mike Sneesby’s total remuneration was down to $2.1m, from $2.7m in 2023, after he took a significant cut to his bonus. His base salary is $1.5m, according to the annual report.
The chief sales officer, Michael Stephenson, also forfeited some of his bonus, with his total remuneration down from $2.2m to $1.8m.
The owner of the Nine TV network was dragged lower by falling revenues in its broadcast and publishing arms, down 9% and 3% respectively.
This was partly offset by a bump in income from subscription streaming service Stan, where revenue was up 5% to $447.7m, as well as revenue up 12% from its controlling stake in real estate listings portal Domain, to $395.7m.
The Nine chair, Catherine West, who replaced Costello when the former federal treasurer quit days after denying assaulting a News Corp journalist at Canberra airport, said the new financial year had started on a positive note. The broadcast of the Paris Olympics lifted audience numbers, she said.
Sneesby told investors total television audiences had grown throughout the year, as had subscription and licensing revenues in publishing and Stan.
Digital subscription revenue from the Age, the Herald and the AFR has also grown, more than offsetting the decline in print masthead sales, he said. The publishing division saw revenue drop 3% to $558.6m.
Total subscribers to the paywalled newspaper sites grew to more than 500,000 (8%) while registered users increased to 1.7m.
The net profit result was weighed down by various inventory write-downs and restructuring costs. When these are stripped out of the figures, the result was down 22% rather than 31%.
Nine announced a final dividend of 4.5c a share, taking the full year to 8.5c, down more than 20% from a year ago.
In a note to staff, Sneesby said Nine now generates a higher proportion of revenue from digital and subscription sources than any other Australian media company.
“However, we are not immune to the economic challenges impacting businesses globally,” he said.
“This year, we’ve had to make some difficult decisions to responsibly manage our costs – decisions that were not made lightly and that I know have real impacts on our people.”
Sneesby told media the company was embracing AI in a limited way, including using 9ExPress, a tool that turns TV broadcast scripts into articles that can published across the digital publishing platforms.
The 2023-24 trading period, marked by high inflation, has proven difficult for publishers and broadcasters around the world, due to subdued demand from advertisers and subscribers.
Free-to-air networks are also grappling with changing viewing habits due to the rise of streaming services, some of which are free or offer cheap subscription rates supported by advertising.
