Seven Media Group tips $150m cost beat as TV revenue dips

Quick one: who chooses the holding music for AGMs? Everyone would like a word.

A yokel-lite ditty, interspliced with random coughs, ran the gauntlet during today's conference call before the soon-to-be Seven Media Group came on to deliver the mixed news: audiences up, TV revenue down, cost savings ahead of plan.

At the company’s first annual general meeting since Southern Cross Austereo and Seven West Media combined, Managing Director and Chief Executive Officer Rohan Lund said Southern Cross Media Group (ASX: SXL) expects to beat its $150 million cost-reduction target. He also said television revenue fell in the first quarter of FY27 as the advertising market softened.

The company also asked shareholders to approve renaming the group Seven Media Group. It already uses that name on its ASX release and AGM presentation.

“We are tracking well, delivering a $150 million cost reduction program, with the full benefit expected in FY28. We expect to exceed that cost target,” Lund said.

Lund did not say how much of the $150 million had been delivered so far. The trading update said the program was “progressing better than expectations, with total costs down from the PCP, despite absorbing one-off sporting event costs”. PCP means the prior corresponding period.

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First-quarter revenue goes backwards

Lund said television revenue fell year on year in the first quarter. Share gains from the Commonwealth Games and AFL finals partly offset a market that was down by a mid-single-digit percentage, as well as lower Google payments for news.

“The economy isn’t great. The advertising market remains short and volatile, with consumer and advertiser sentiment variable,” he said. “We are managing the business with that uncertainty in mind, and we have been more aggressive in setting the cost base on the assumption the broader economy deteriorates in the second half.”

Audio revenue was broadly flat. Publishing revenue fell, which the company put down to weaker advertising markets, schedule changes affecting events income, and lower Google payments. Higher circulation and subscription income partly offset the drop.

“The NBI legislation has been passed, and we will seek to recover our full share from the pool,” Lund said.

The update follows a weak FY26 result. Pro forma revenue fell 4.4% to $1.87 billion. EBITDA fell 15.8% to $192 million excluding onerous contracts, or 12.8% to $200 million including them. Net profit after tax dropped 58% to $10 million. Net debt rose to $363 million, and leverage rose from 1.5 times to 1.8 times.

“The financial result for the year did not meet our expectations. Nor did it deliver on the potential we believe exists for this business,” Chairman Ryan Stokes added.

Audiences up, revenue yet to follow

Lund said audience growth was the group’s main strength but conceded it had not yet turned into earnings.

“Audiences are not our challenge,” he said.

He repeated figures first given at the company’s Upfronts. Total TV audiences grew 9.5% year on year across both broadcast and streaming, and 7plus grew around 50% year on year. He did not say which 7plus measure the 50% referred to. He also said Seven delivered its biggest first-quarter share since VOZ ratings began.

In audio, Lund said the metropolitan networks have led the 25–54 demographic for 42 consecutive surveys. According to the AGM presentation, the group’s metro 25–54 audience share rose from 35.2% in FY25 to 36.8% in FY26. Its audio advertising revenue share rose from 28.3% to 30%.

“Audiences are growing right across the group. Our strategy is working. The work now is to deepen engagement and convert that audience performance into commercial results,” Lund said.

Stokes takes aim at global platforms

Stokes used his first address as Chair to call for regulatory reform aimed at global technology platforms.

“Global digital platforms have built their businesses on algorithms designed to capture attention and engagement for their own commercial ends, with little accountability to the communities where they operate. That has included profiting from scam advertising that uses AI-generated likenesses of well-known Australians to defraud the community,” he said.

“They use algorithms to capture Australian audiences and Australian content, without a comparable contribution through tax, employment or investment in local journalism. And they are not bound by the regulatory and community obligations that apply to us. That is not a level playing field, and the gap widens as audiences move online.”

Stokes said the company wants a framework that guarantees free and universal access to sport, news, and entertainment.

“It means protecting Australian content from being used by AI platforms without permission or payment. It means addressing competition failure in advertising technology markets, and it means reforming the regulation of our own sector, much of which was designed for a different era, so that locally owned media companies can invest and compete on fair terms,” he said.

One company, one name

According to Stokes, the combined group reaches more than 20 million Australians each month. He said it has almost 16 million registered 7plus users and 2.7 million LiSTNR users.

“Over the past year this business has been known as Southern Cross Media Group, Southern Cross Austereo and Seven West Media. The new name reflects what the company now is: one company, with one strategy and one identity,” Stokes said.

The consumer brands, including Seven, 7plus, 7NEWS, Triple M, Hit, LiSTNR, The West Australian, The Nightly, and PerthNow, keep their names.

Lund’s first six months

Lund joined the Board in March and became Managing Director and Chief Executive Officer on 1 May. He was Group Chief Executive Officer of the NRMA from 2016 to 2025. Before that, he held senior roles at Foxtel, Seven West Media, Yahoo!7, and Singtel Optus.

Stokes said Lund had set up the operating model for the combined group and appointed his leadership team. The board’s stated priorities are finishing the integration, cutting the cost base, and growing revenue from a single offer to advertisers across the group’s TV, audio, and publishing brands. Lund pointed to the 7ID audience data platform, the planned Phoenix Exchange trading system, and a larger YouTube presence as part of that push.

“Six months into this role, I am more confident about the opportunity in front of us. I am also clear about the work we have to do to turn that opportunity into better returns for you,” Lund said.

“You should judge our progress by delivery: the savings we achieve, the revenue share we generate from our audience strengths, and the improvement in earnings and cash generation over time.”

Board vote on Marina Go

A shareholder had put forward a resolution to remove Director Marina Go, who is also standing for re-election. All directors except Go recommended shareholders vote for her re-election and against her removal.

Proxies lodged for the resolution showed Go would be re-elected, with confirmation to come from the company later today.

Stokes noted that the independent directors elected Cathy O’Connor as Lead Independent Director in September. He said that, given his role at SGH, a substantial shareholder, that position is “an important part of how this Board is governed”.

“We will deliver on that plan, and the new shape we want for the group will be very apparent by FY28,” Lund said.