ARN reveals $20 million in cost savings during parent’s AGM
HT&E has one of the strongest balance sheets in Australian media, the company’s chairman told shareholders during its annual general meeting on Thursday.
Ad revenue for Australian Radio Network fell more than 40% last month as the broadcaster slashed overheads, reduced pay and working hours and applied for JobKeeper.
Its first-quarter revenues were down 7.2% between January and March, a stronger bill of health than the industry-wide figure of 12.4% reported by Commercial Radio Australia.
Parent company HT&E confirmed it has also found operational savings of between $20 million and $23 million as it looks to keep the balance sheet positive during uncertain times.
Chairman Hamish McLennan revealed the company was debt-free and, while some rivals are struggling with capital structures, HT&E had $111 million in cash at the end of 2019.
“Thanks to a number of strategic steps taken last year, our business is one of the better-placed media companies in Australia currently facing this crisis,” he said.
“This is a very healthy position for HT&E to be in at this time giving us the potential to explore the right strategic opportunities for the business should they arise.”
One of those strategic opportunities was the purchase of equity in oOh!media, acquiring 11 million shares in the outdoor biz at a reported cost of $15 million.
The company’s chief executive, Ciaran Davis, also told shareholders that ARN had “actively managed” any misconception that COVID-19 was going to negatively impact radio listenership.
“It was critical that advertisers were provided evidence to the contrary and retained confidence in the strengths of the medium,” he said, after the release of owned-data published April 15.
In a market update to the ASX, the media group said direct sales, which usually accounts for about 30% of total revenue, had been particularly impacted by the pandemic.