Speaking at the AGM yesterday, QMS chief executive Barclay Nettlefold was upbeat about continued growth of the business as it expands beyond out-of-home.
“The past six months has seen the business evolve to take advantage of exciting growth opportunities and to ensure that we have the right structure in place for sustained long-term shareholder value creation,” Nettlefold told shareholders.
“Whilst our business has evolved, our fundamental focus remains on providing premium quality assets that drive financial and operational performance.
“During the six months to 31 December 2018, our diversified quality portfolio continued to deliver solid revenue growth.”
• Statutory Group Revenue was up 9% to $107.6 million,
• Gross profit up 11% to $53.3 million,
• Gross profit margin was 49.5% compared to 48.6% for the prior corresponding period,
• An underlying EBITDA of $22.7 million; and
• Net profit after tax and amortisation was up 9% to $13.5 million.
Nettlefold continued: “Delivering on our strategic plan across our three business segments, underpinned by our quality digital portfolio and proprietary data and analytics platform, we continue to build an industry leading portfolio for growth.
“Taking a more detailed look at each of our three business segments; QMS Australia is thriving, and continues to grow its reputation in the market, characterised by its asset quality, strength of sales team and deep customer relationships.
“In December, we announced a transformational strategic development for QMS New Zealand with its proposed merger with MediaWorks, creating the leading multi-media provider across four platforms: out-of- home, radio, TV and digital. This strategic opportunity will result in a very powerful media combination, providing what we believe will be an unrivalled destination for advertisers to not only build brands, but maximise audience reach throughout New Zealand.
“Reconfirming the terms of the deal, QMS will hold a 40% shareholding in the expanded MediaWorks business. MediaWorks yesterday released its results for FY18 and reported growth in group revenue of approximately $5 million to $305 million and an increase in Group EBITDA of 14.8% to $24.8 million, up $3.2 million on FY17.
“Their targeted strategy to attract the desirable 25-54 year old audience is working;
• Channel 3 is now the number one TV channel for this audience across peak viewing, overtaking TVNZ1 and TVNZ2; and
• Radio represents the top 6 music stations by share for 25-54 year olds.
“This is a positive result in a challenged and disrupted media landscape. Our focus now remains on successfully completing the merger and realising the full growth and potential that the combined capabilities will deliver for the Group.
“QMS Sport’s revenue was $13.1 million for the six months to 31 December 2018, with an underlying EBITDA loss of $(0.3) million. This result reflects the investment made in sport technology and rights during the period, ahead of the strong revenue and earnings contribution expected this year and beyond.
“Our three defined business segments of QMS Australia, QMS New Zealand and QMS Sport – sets us apart from our peers and differentiates us given our attractive growth opportunities.
“The out of home industry continues to be a leading growth sector within the media landscape and our strong business in QMS Australia, is well positioned for continued growth.”