Seven West Media remains bullish that TV will remain the dominant media channel in the face of increasing fragmentation and competition from new video on demand providers. Television revenues make up 70% of the company's total.
Sport and home-made content underpin the firm's confidence, with CEO Tim Worner nodding to the investment in production companies 7Wonder and 7Beyond as a key content pillar both for broadcast and publishing operations.
Of the latter, chairman Kerry Stokes noted the “well documented” headwinds facing traditional publishing businesses, but Worner said that the firm would keep building out digital editions as another channel to distribute and monetise its content. Worner also said the company was starting to ramp up investment in its data play, Red Fusion, which the company first mooted almost two years ago.
Posting a net profit of $149.2 million for the year ended 28 June 2014, the company increased television revenues to $1.306bn, up 3% year on year. The TV ad market grew 3.5% over the same period according to SMI data. TV earnings before interest and taxes stood at $312.1m, up 7.5% off a record 40.5% revenue share of the total market.
Seven's newspaper revenues (circulation and advertising) fell by 12.4%, from $303.1m to $265.4m, suggesting a consistent year-on-year-on-year rate of decline. Circulation revenues declined 7.3%. Ad revenues declined 14.7%. The company managed to shave $16m of cost from the business over the year, and flagged further cost cutting in the year ahead. Part of those savings, bringing Channel 7 Perth and the West Australian under one roof, illustrates the blurring of the line between publishing and broadcasting taking place across media globally. Locally, Nine and Fairfax are reported to be in talks, and it could be that another TV broadcaster and major publisher form even closer ties before the year is out.
Pacific Magazines revenues fell from $256.2m to $237.5m, a decline of 7.3%, suggesting a less steep curve than from 2012 to 2013, when revenues fell 10.8%. Circulation revenue declined 8.3% to $154m. Ad revenues fell 6% to $72.8m. The company wrote off $77m against the value of its mastheads, goodwill and licences.
Other media revenues, including those of Yahoo7, Australian News Channel (Sky News), Quokka, Community Newspapers, regional newspaper publishing and regional radio licences in West Australia, totalled $53.2m, a decline of 3.1%. Seven said that growth in Yahoo7 and Community News was offset by declines in most of the rest of the businesses.
Monthly visitors to Yahoo7 each month were up 19.5% to 9.1m on average, the company said. Video streams has increased by almost 25% to 116m over the year. More than a third of them were long form video. Mobile audiences were up 60%. The joint ventures share of advertising revenues increased 16% in the second half according to Seven West media, citing Standard Media Index data.
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