By Bob Peters, Global Media Analysis
Not only does 97.3FM currently have Brisbane’s largest audiences, revenues and profits, but there is also compelling evidence supporting the view that the station has been metropolitan radio’s best and most consistent financial performer over the past decade.
In calendar year 2014 (CY2014) the station grew sales revenues by 15.9% to $29.3 million and increased operating profits by an even larger 21.3% to $14.7 million, thereby generating a record 50.2% operating margin.
Although a handful of other metro radio stations, most of which operate in the larger Sydney and Melbourne markets, have generated larger annual revenues and/or profits at times over the past 10 years, none are likely to have bettered 97.3FM’s steady financial performance over that period in terms of both consistent revenue and profit growth and the maintenance of high and still-improving profit margins.
The station’s financial credentials are extremely impressive. For example, since it commenced broadcasting:
• The station has been profitable since its first full year of operation in CY2002
• Sales revenues and operating profits have increased in every year except one since CY2002
• Since its first full year of operation, sales revenues and operating profits have increased at compound annual growth rates (CAGRs) of 10.4% and 15.9% respectively
• Over the past five years, the station has generated an average annual operating profit margin of 49.0%.
Historic performance
Station 97.3FM holds Brisbane’s third commercial FM radio licence which was purchased for $67.0 million at an auction conducted by the Australian Communications and Media Authority (ACMA) in May 2001 by a joint venture company equally owned by the Australian Radio Network (ARN) and Nova Entertainment (Nova) as it is now known. The station is managed by ARN.
During its 13 full years of operation between CY2002 and CY2014, 97.3FM’s total revenues increased at an above average compound annual rate of growth of 10.4%, while the station managed to limit increases in total operating expenses to a lesser 6.9% CAGR.
Current Year Prospects
Based on year-to-date trends, 97.3FM appears to be on track to generate another record financial performance in CY2015, since market advertising revenues have experienced solid growth since the start of CY2015 and the station has managed to increase its commercial rating share in FY2015.
Another record-breaking year would give further support to the claim that 97.3FM has been metro radio’s best and most consistent financial performer over the past decade or more.
Source: Global Media Analysis
Image (L to R): Bob Gallagher,Terry Hansen and Robin Bailey