Seven West Media withdraws earnings guidance

Chris Pash
By Chris Pash | 24 March 2020
Getty

Seven West Media, joining a string of ASX-listed media companies, has withdrawn its earnings guidance over the escalating "uncertainty" relating to the COVID-19 pandemic.

The company says there has been a "material fall in advertising market activity" and the suspension or postponement of productions and events.

"Seven West Media’s visibility into future advertising bookings is now insufficient to provide meaningful earnings guidance," the company told the ASX.

The free-to-air network's rights to major sporting events are under assault.

The AFL has suspended games until the end of May and the Tokyo Olympics are in doubt.

"While the International Olympic Committee’s (IOC) current position is that Tokyo 2020 is scheduled to proceed, the IOC has stated they are exploring a postponement scenario and the Australian Olympic Committee (AOC) and other national bodies have been more definite about a date change," Seven West says.

"There is no decision as at the date of this release but one is expected shortly. Such postponements are likely to result in rights payments by SWM being pushed back to reflect the revised scheduling; any adjustments remain subject to negotiation. However, postponements may also incur cancellation costs from underlying suppliers."

Seven West Media in February posted half year statutory net loss after tax of $66.35 million in a  "challenging" advertising market.

This compares to a profit of $83.4 million for the same six months the year before. Revenue over the half year to December fell 3.2% to 772.42 million.

Seven West shares last traded at $0.066, giving it a market capitalisation of about $105 million, well belowthe company's net debt of of $569.5 million.

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