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Seven West Media Ltd (ASX:SWM) has seen a cut in earnings for the 2024 fiscal year by a third compared to the same time last year, which it blamed on a tough economic environment and a slight increase in costs.
According to the company’s 12-month financial report released today, EBITDA (earnings before interest, taxes, depreciation, and amortisation) were down 33% – to $187 million – in the 2024 fiscal year compared to the previous year.
There were also falls in group revenue – which was 5% lower in the 2024 fiscal year compared to the previous one, at $1,415 million – in addition to an 8.2% drop in the total TV market for the year.
The latter however, reflected a sharper downturn in the first half of the fiscal year – where the TV market slumped by 9.1% – which moderated in the 7.2% in the second half.
Despite this, Seven West did report a growth in total TV revenue by 40.2% across the year, with total linear audiences growing slightly by 0.5%.
SWM Managing Director and Chief Executive Officer, Jeff Howard pointed to a variety of factors explaining the result.
“FY24 is a tough result for SWM in a challenging market. While growth in audience and revenue share partially offset the impact of the weak market, cost growth of 2% contributed to our EBITDA decline of 33%, reflecting the operating leverage in our business,” he said.
“Following delivery of $25 million of cost out initiatives in 2H, we have taken decisive action to materially increase the program into FY25 to give SWM a platform to drive improved
performance.
“The continued weak economic environment contributed to an 8.2% decline in the total
TV advertising market on FY23. SWM was able to partially offset this decline by increasing our revenue share of the total TV market to 40.2%.”
With the 2% cost rise registering $1,228 million, Mr Howard said action would be taken on this issue.
“The Group was able to partially offset these investments through the implementation of $25 million of cost reductions in the 2H under the program announced at the FY23 AGM,” he said.
Seven West Media has been trading at 16 cents.
