Media giant Nine Entertainment’s profits have fallen by almost a third to $134.9 million for the full year as the media giant cuts costs by eliminating hundreds of roles.
The company’s accounts published on the stock market on Wednesday show its statutory net profits fell by 31 percent to the end of June 2024.
Nine owns some of Australia’s largest media platforms, including Channel Nine, streaming service Stan, radio stations 2GB and 3AW, The Sydney Morning Herald, The Age and the Australian Financial Review.
Revenue rose to $2.6 billion, down 3 percent, with earnings before interest, taxes and depreciation (EBITDA) of $517 million, down 12 percent.
In June, long-time chairman Peter Costello announced he was leaving the company following an altercation with a journalist at Canberra Airport.
New president Catherine West said in a statement that the company was performing well in a challenging market.
Chief executive Mike Sneesby, who was criticised by his staff when he carried the Olympic torch in Paris, agreed with her assessment.
“In a year of difficult economic and advertising conditions, there were some clear positives in this result,” he said.
Media giant Nine Entertainment’s profits have fallen by almost a third to $134.9m for the full year. Pictured are Nine presenters Karl Stefanovic and Sarah Abo, who were unaffected by job losses.
At digital streamer Stan, EBITDA rose 24 percent to $46 million, while at real estate website Domain, profits rose 26 percent to $137 million.
But it was a different story for Nine’s larger television and publishing divisions: TV division EBITDA fell 32 per cent to $208 million, publishing division profits fell seven per cent to $153 million, while audio division profits fell by a third to $8.4 million.
In the current financial year, Nine recently had strong audiences and revenue across all platforms thanks to its broadcast of the Paris Olympics and the network is also covering the Paralympics, Sneesby said.
Coverage of the Paris Games reached an unprecedented national average daily audience of nearly 10 million people.
Nine has spent $305 million to secure Olympic broadcast rights, including the Brisbane Games in 2032.
While revenue from gaming-related advertising and subscriptions is expected to top $160 million, the company said it expected the business to break even.
Nine has cut costs by $65 million over 2023/24 and in June said it would cut 200 jobs or about four per cent of its nearly 5,000-strong workforce.
“Of our national team of almost 5,000 people, around 200 jobs are expected to be impacted across Nine, including some vacant and casual roles that will not be filled,” Sneesby said earlier this month.
Nine announced hundreds of job losses earlier this month.
Nine took a big hit to its profits, but chief executive Mike Sneesby welcomed the Olympics viewership surge
“For us to continue to invest in digital growth opportunities at Nine, we must continue to responsibly manage costs throughout the cycle.”
The job cuts include 38 positions across the high-profile news and current affairs broadcast team, which included 9News and 60 Minutes.
In addition, 90 jobs will be cut from Nine’s editorial division, affecting roles at The Sydney Morning Herald, The Age and The Australian Financial Review.
The cuts came as a commercial agreement with social media giant Meta, which owns Facebook and Instagram, ended.
Nine expects to reduce underlying costs by a further $50 million in the 2025 financial year, representing a cost reduction of about $100 million over two years, chief financial officer Matt Stanton said.
In July, Nine Mastheads staff went on a five-day strike to demand wages and working conditions during negotiations for the company’s collective agreement.
The walkout also followed a controversy in May over Nine’s handling of historical complaints made against former news chief Darren Wick.
Mr Sneesby acknowledged public comments about the company’s culture and promised the issue was being taken “incredibly seriously”.
Meanwhile, Nine is speaking to major AI platforms about the use of its content and has updated its websites to prevent AI platforms from using it without permission, Sneesby said.
The company has also decided not to expand its share buybacks on the market.
Nine has spent $68 million on the buyback in 2023/24, bringing total spending to more than $220 million over two years, Stanton confirmed.
A fully franked dividend of 4.5 cents per share will be paid on October 24.
Nine stocks are trading around $1.34 and were above $2 in August 2023.