ARN Media (A1N) H1 2024 earnings summary

Executive summary

• Maintained #1 network position in Sydney and Melbourne, with a cumulative metro audience reach of 6.2 million and strong regional ratings.

• Group revenues up 4% pro forma and 1% reported, with resilient advertising and digital audio audience growth.

• Digital audio audience grew 9-10%, reaching 2.8 million registered iHeart users and continued leadership in podcast publishing.

• Secured two major Hong Kong advertising contracts, positioning for scalable market share recovery and future revenue growth.

• Interim dividend declared at 1.2cps, fully franked, representing 70% of NPAT after significant cash items.

Financial highlights

• Group revenues reached $168.1 million (+4% pro forma, +1% reported); EBITDA before significant items was $35.5 million (flat reported, +10% pro forma).

• EBIT before significant items was $22.3 million, down from $25.3 million; NPAT attributable to shareholders before significant items was $10.4 million, down from $14.6 million.

• Statutory NPAT was $5.4 million, down due to higher depreciation, financing costs, and one-off SCA transaction costs.

• Net debt at $86.8 million, leverage at 1.58x EBITDA; operating cash conversion at 65.2%.

• Dividend payout maintained at 70% of NPAT after significant cash items.

Outlook and guidance

• Q3 revenues forecast slightly above prior year, with digital growth offsetting radio.

• Full half/year revenues expected to be 2-3% ahead of prior year; radio up ~1%, digital up 25%.

• People and operating costs to increase 2-4% year-over-year, in line with guidance.

• Digital audio operations targeted to reach EBITDA and cashflow positive in Q4 2024.

• Hong Kong tram revenues for the remainder of the year forecast slightly down due to early trading conditions.