ARN Media reported a 14% drop in revenue to $127.9 million for the half year to June, reflecting a reduction in metro radio revenue share over “brand safety concerns” associated with KIIS breakfast.
The group reported a net loss after tax of $27.6 million, mainly due to a $25 million non-cash impairment charge relating to intangible assets, and $17.2 million which includes $11.6 million settlement costs with Kyle Sandilands’ Quasar Media payable over three years.
The Kyle & Jackie O show was taken off the air earlier this year after Jacqueline Henderson said she couldn't continue to work with Sandilands. Both took legal action against ARN. Sandilands settled. Henderson's is still pending.
ARN said the total audio advertising market is expected to be broadly flat, with low single digit declines in the radio market, offset by growth in digital.
The company expects its metro revenue share to improve throughout the year ARN is focused on delivering $55 million in cost savings.
ARN has suspended paying dividends while it completes the divestment of non-core assets and resolves outstanding litigation.
“ARN has made strong progress in stabilising the core business, simplifying the portfolio and strengthening the financial position of the group,” said CEO Michael Stephenson.
“During the half, we entered into an agreement to divest Cody Hong Kong, settled the Quasar Media matter and continued to reset the cost base, with a clear pathway to deliver $55 million of cumulative cost savings by the end of FY27.
“These actions provide greater certainty for shareholders and create the operating and financial flexibility required to execute our strategy.
“While first half revenue was impacted by residual brand safety issues in KIIS Breakfast and the Federal Election in the prior year, ARN’s underlying audience position remains strong, and our immediate priority is to regain metro radio revenue share.
“There is a clear gap between our audience share and our revenue share.
“We will continue to accelerate our transition from a traditional radio business to a broader Entertainment company.
“iHeart, data, video, social and live experiences are central to this strategy and provide a significant opportunity to diversify revenue and improve long term monetisation of ARN’s leading audio assets.”
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