Seven West Media traded at higher level on the day of its Annual General Meeting. At the time of writing, 14 November 2018 (2:56 PM AEST), the share price of Seven West Media has edged up by 1.37% to trade at $0.740.
In the address to shareholders at the 2018 AGM held today, Seven’s Chairman Mr. Kerry Stokes AC mentioned the significant improvement that Seven West Media has shown in the past one year with stronger TV ratings, revenue and cost savings.
Mr. Kerry Stokes cited Seven West Media Limited (ASX: SWM) continues to dominate the Australian television sector as it is ranked Australia’s number one TV network for the 12th consecutive year. He added that the group has achieved a record production run of top rating and high-quality television programs including Australian Open Tennis, Rugby League World Cup, Winter Olympics and Gold Coast Commonwealth Games as well as its ongoing AFL coverage. With the combined reach of more than 20 million people across the country, Seven’s profit touched the upper end of its $220-240 million guidance, that translates underlying Earnings Before Interest and Tax of $236 million for FY18.
On the debt’s reduction fronts, the group has managed to bring down its net debts significantly by $90 million from $725 million to $635 million. Meanwhile its cost saving initiatives has delivered a net reduction of $21 million in costs, after utilizing the savings to offset the spectrum charges and higher AFL rights fees imposed during the financial year 2018.
During Fiscal 2018 the company has launched a wholly-owned digital platform, 7Plus. With the library of over 6000 episodes from the world’s largest studios alongside its own exclusive originals, 7Plus has gone from launch to number one in 10 months.
Managing Director and CEO Mr. Tim Worner revealed that Seven’s digital advertising revenue grew 100% over the 2018 financial year.
Further, in April the company has signed six-year deal with Cricket Australia. The deal ensures we have more than doubled the hours of premium summer sports content.
Commenting on new sports deal in cricket, Mr. Worner stated that Seven now has additional strength in its December half schedule and the company has improved its audience position in the Eastern states. He added “I (Tim Worner) can tell you that the advertiser response has been extremely encouraging.”
In addition to this, the company has locked in a new a new five-year affiliation agreement with Prime Media Group, commencing at the start of the 2019 financial year with a further step up in FY20.
Mr. Worner further stated that in the third quarter the company will launch 7news.com.au, a new online home for Australia’s Number One and most trusted News and Public Affairs brand 7 News, while taking an exit from Yahoo7 joint venture.
In the outlook for FY19, the company has upgraded its cost saving targets for the 2019 financial year from $10-20 million to $20-30 million. The company confirmed that the underlying EBIT in FY19 is expected to grow by 5-10% on the prior period while the leverage ratio is expected to fall below 2 times by June 2019.
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