SCA shares up as ad market improves
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SYDNEY, Feb 19 AAP
February 19 2013, 11:11AM
Shares in Southern Cross Austereo (SCA) have risen sharply as the broadcaster says advertising markets are showing signs of improvement.
The stock was up 12 cents, or 9.76 per cent, at $1.35 at 1058 AEDT, after SCA reported net profit for the six months to December 31 of $45.13 million, down 52 per cent from $94.04 million in the prior corresponding period.
"We have had one of the most difficult 12 months in our history," SCA chief executive Rhys Holleran said in a statement on Tuesday.
"Despite this, we have produced a result that has met market expectations through rigorous operational management."
Revenue fell 10 per cent to $327.68 million, SCA said.
While revenue from its radio stations fell 1.8 per cent in the half, revenue at SCA's television stations slid 16.5 per cent.
SCA has suffered from the lacklustre ratings at Network Ten, which supplies content to SCA's television stations.
Despite the difficulties as a result of Ten's poor performance in 2012 - including the loss of Australian Football League broadcasts - Mr Holleran said he remained supportive of Ten.
"TV ratings are challenging, but we belive we are turning the corner and we remain supportive of our supply partner Network Ten," he said during SCA's results presentation on Tuesday.
Mr Holleran said he believed Ten's lineup in 2013 would be stronger than was the case in 2012.
Elsewhere, Mr Holleran said SCA's regional radio stations in Queensland had been showing some good signs of recovery.
"Local advertising markets were positive for the first time in a while and that's a good sign," Mr Holleran said.
"If you measure our regional radio business against the broader media market, it is probably a pretty good result and I think it says a lot about our diversified client base and a mix heavily weighted towards local advertising."
In terms of guidance, SCA said underlying after tax earnings for the full 2012/13 year was "expected to come in within market estimates of $90 million to $95 million".
"Current market sentiment is improving and a long federal election campaign may help revenue opportunities," SCA said in a slide presentation accompanying the financial results.
In December, SCA suspended advertising on its 2DayFM station in Sydney amid a public backlash over the radio station's Duchess of Cambridge prank hospital call.
The incident cost the company $400,000 in the half, SCA's accounts showed, with any continuing financial impact "immaterial".
SCA declared an interim dividend of 4.5 cents per share, fully franked.