ARN parent HT&E closes esports arm as revenue dips
ARN‘s parent company HT&E is set to focus more closely on its radio and music streaming businesses, following a drop in revenue of 4% for the 2018/19 financial year.
HT&E saw its revenue drop, attributing the fall to a softening radio market.
The company announced that it will wind up its Esports partnership with UK company Gfinity at the end of 2019 due to a lack of sustainable earnings.
Revenue fell despite costs falling 13% to $95.8 million, and a rise in underlying EBITDA from $30.4 million to $38.1 million year-on-year.
Net profit before tax also rose almost $5 million, but revenue before finance income was reported being down more than $6 million to $130.9 million for FY19 (-4%).
HT&E chair Hamish McLennan said the closure of Gfinity would help the business focus on audio industry.
“We are first and foremost a radio and audio business since selling Adshel and over the last six months have spent a huge amount of time focusing on the objective of creating Australia’s most complete and compelling audio offering,” said McLennan.
“We have made good progress reducing corporate costs and simplifying the management and operational structures between HT&E and ARN.
CEO Ciaran Davis added; “Our absolute focus is on our core radio business that remains highly cash generative with exceptional margins.
“Across the network we are reaching record numbers every week and we have maintained our winning edge, retaining the number one and two FM breakfast shows in Sydney, and KIIS 101.1 in Melbourne recording its highest station audience since 2014.
“We are continuing to focus on growing ratings and gaining market share by recruiting and retaining the best radio talent in Australia.”
“Broadcast radio remains our core business, and the big opportunity to transform from a radio offering to an audio business.
HT&E has also moved on two senior executives, with HT&E CFO Jeff Howard and group general council & company secretary Yvette Lamont to both depart at the end of the year.
ARN CFO/CFO Michael Harvey will become the COO of HT&E, while HT&E group taxation manager Jeremy Child will assume the role of company secretary in addition to his current duties.
Former HT&E group finance manager and CFO of Adshel Andrew Nye will become CFO of both HT&E and ARN.
“On behalf of the Board I want to thank Yvette and Jeff for the professional way they’ve assisted with this review and helped resolve the new model, but more importantly, for the significant contribution they’ve made to HT&E over their respective tenures, and particularly in the four years I have been CEO,” said Davis.