Seven West Media (ASX:SWM) riding high on cricket rights extension

2 min read | January 03, 2023 12:40 PM AEDT | By Sonal Goyal

Seven West Media (ASX:SWM) riding high on cricket rights extension — Image source: © Szpytma | Megapixl.com

Details of the extended cricket rights

Through an ASX filing, Seven informed the market that it has entered into an agreement with Cricket Australia, under which its cricket rights have been extended to the 2030-31 season. As reported, it is a seven-year agreement between the parties.

With this agreement,

Source: company update

The agreement will include two Indian tours to Australia and two Ashes Series. Also, Cricket Australia will revamp the Big Bash League (BBL) to create a tournament that will last for five to six weeks.

SWM said that it has also offered a revenue share upside on the BBL as part of the commitment to improve the BBL. The company will pay increased right fees only if it achieves some BBL revenue hurdles, which are anticipated to deliver positive earnings every season.

Financial terms of the contract

SWM informed that it will pay AU$65 million annually in cricket media rights from 2024. It represents a reduction of 13% on the current agreement. The agreement comprises a 2% escalator per year.

In comparison to the existing rights deal, the company has achieved cash savings from production savings and rights reduction of over AU$50 million over the term.

Management Commentary

James Warburton, managing director and chief executive officer of SWM, commented on the development:

Source: company update

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