Broadcasters’ news

TVNZ reports profit of $12.7 million

TVNZ has reported a net profit after tax of $12.7 million for the financial year ending June 2016. Profit was in line with the financial targets set out in the Statement of Performance Expectations after adjusting for unrealised foreign exchange losses.

TVNZ CEO, Kevin Kenrick says: “The performance highlight of the year was TVNZ’s strengthened share of TV audiences. Audience share reached a five year high powered by market leading news, current affairs and local entertainment programmes. Off the back of this audience improvement TV advertising revenue share strengthened from 60.8% to 61.3%.”

Overall revenue declined $23.9 million (6.8%) due to year on year declines in market demand for TV advertising, Government funding, event broadcast linking services, as well as the one-off gain on sale of the TVNZ Archive assets in FY2015.

Operating expenses reduced by 3.3% year on year to $303.3 million primarily due to reduced programme amortisation and labour costs.

Kevin Kenrick says “We’re seeing mobile devices driving huge growth in online video consumption with TVNZ OnDemand and ONE News Now delivering an average of 10 million video streams per month.

“To compete more effectively with global scale online players, TVNZ entered into a joint venture with Fairfax Media, MediaWorks and NZME to develop and launch KPEX – a local online advertising exchange.

“The other major launch initiative for the year was DUKE – TVNZ’s new on-air and online entertainment channel.”

The 2016 financial year signified the transition of TVNZ to a wholly commercially funded business with the end of the Pacific Broadcast Service – the last remaining form of direct Government funding.

2016 also brings to a close the multi-year refurbishment of TVNZ’s Auckland building at 100 Victoria Street West. The completion of this major capital project signifies the resumption of full dividend payments and TVNZ will return a dividend of $13.4 million to the Crown for FY2016.

Financial Highlights Summary – Year Ended 30 June 2016
    FY2016   FY2015
    $’000   $’000
Revenue and income    326,075      349,992
  Advertising revenue    303,902      314,192
Operating expenses   (303,326)     (313,676)
Operating earnings      22,749        36,316
Interest expense            (90)              (92)
Asset impairment               0            (486)
Financial Instruments       (4,790)             912
Share of results of associates            (38)                 0
Income Tax       (5,144)         (8,535)
Net Profit after tax      12,687        28,115
Dividend      13,370          8,252