HT&E full year results – after 22% revenue drop, recovery as radio market improves

HT&E

HT&E has released its results for the 12 months ending 31 December 2020

HT&E revenue down 22% full year – $252.7m to $193.7m YOY
Net profit after tax down from $38.5m to $18.5m
Costs down $30.3m (16%) YOY
ARN radio revenue down from $208.4m to $165.1m YOY
ARN digital and other revenue down from $14.9m to $10.2m YOY

HT&E has released its results for the 12 months ending 31 December 2020.

The company has reported it has emerged from 2020 a stronger business by strengthening its core radio operations, investing in digital audio growth, and maintaining balance sheet strength with net cash of $112 million.

ARN claims to be the #1 metropolitan radio network in Australia reaching a record 5.3 million listeners a week and continuing to win commercial share that has seen the radio group exceed market performance each quarter in 2020.

During the year ARN saw strong growth in digital listening with +19% increase in iHeartRadio registered users, and also launched the iHeartRadio Podcast Network which is now the biggest podcast publisher in the country with over 16 million downloads a month.

HT&E chairman Hamish McLennan said, “HT&E navigated the period well and has maintained its strategic focus during the year, strengthening our core Australian radio operations, further investing in digital audio, as well as building further balance sheet strength, providing optionality in a consolidating market.

ARN remains the best performing audio company in Australia, both commercially and in ratings, delivering advertisers integrated, unique and engaging content from some of the world’s best talent across radio, music streaming and podcasting.

“HT&E’s investment in oOh!media is already delivering value for shareholders, as we paid $18.1 million for a 4.7% stake at the height of the pandemic in the first half, and at year end it was valued at more than double our initial investment.

“Our investment in Soprano has the potential to provide significant value beyond current book value and is non-core to the company’s strategy. We have appointed Macquarie Capital to explore options to maximise our 25% shareholding.”

HT&E CEO & managing director Ciaran Davis said, “Despite the extraordinary disruption to our business due to the pandemic, ARN maintained its position as the #1 metropolitan network in Australia, and continued to take commercial market share. We are building momentum in our digital audio transformation as extraordinary growth of digital listening saw a 14% growth in iHeartRadio app downlands, and a 19% growth in registered users to 1.9m.

“What we achieved in 2020 demonstrates HT&E’s leadership in the Australian audio market. In a year that has rewritten history, Australian audiences have made ARN and iHeartRadio podcast brands the number one choice for audio content, delivering consistency and certainty for our commercial clients. I am confident that the momentum that we have built will continue in 2021 as we focus on creating the leading audio entertainment business in Australia.

“Coming out of the pandemic we are in an excellent position to drive shareholder value. We have protected earnings and cash reserves providing a very strong balance sheet and maximum optionality regarding our growth opportunities.”

Australian Radio Network highlights

Growth in total listening across COVID-19, with ARN commercial radio now reaching 5.3 million people weekly from breakfast to drive

Streaming of ARN radio stations experienced an increase of 14% in total listening

KIIS 1065’s Kyle & Jackie O continue to dominate Sydney breakfast radio, finishing the year where they started at #1FM

GOLD 104.3 in Melbourne now established as the clear #1FM, along with The Christian O’Connell Breakfast Show

ARN #1 podcast publisher in the country after iHeartRadio Podcast Network Australia launched in February 2020

Podcast downloads reaching new listening highs, increasing by 124%

ARN trading outlook

Q1 revenue outlook continues to strengthen with current pacing for March indicating total revenues could finish flat on prior year. Revenue for January finished back 6.9% with pacing improving on this result for February, assisted by continued improvements in broadcast radio performance and growth across our digital assets.

ARN is encouraged by early briefing activity for April and Q2 campaigns.

Subject to the advertising market recovery continuing, ARN anticipates total people and operating costs to be in line with 2019.

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