GMA7 9-mo earnings down, ABS-CBN’s up
GMA Network Inc., operator of the country’s second largest television network, is unlikely to meet an earlier projected 10 percent profit hike this year as earnings in the nine months through September slid due to higher expenses and slowing revenues, officials said Monday.
Company officials said in a briefing that net income during the period dipped 6 percent to P1.49 billion while revenues rose 4 percent to P9.75 billion. GMA said airtime revenues during this period was up 5 percent. Operating expenses, meanwhile, rose 7 percent to P7.6 billion, which the company said was due to higher production costs meant to “diversify and strengthen” TV content.
From earlier expectations that the company would grow profit about 10 percent to P1.6 billion last year, the company was now “looking at a flat 2013”, chief financial officer Felipe Yalong said during a briefing.
The company could still end above last year’s earnings, said chair and CEO Felipe Gozon as large advertisers are seen to return in the fourth quarter.
“If not equal, we can surpass [2012],” Gozon noted.
For the third quarter alone, total revenues dipped 11 percent to P2.69 billion as airtime revenues slid 14 percent. Net income during this period hit P353 million, down over 38 percent.
“The reduction in revenues is attributed to a combination of factors, not least of which is observed challenges in comparative program ratings,” GMA president Gilberto Duavit Jr. said during the same briefing.
“It’s not viewed as being a permanent condition as the fourth quarter will verify,” Duavit added.
In a separate statement, rival network ABS-CBN Corp., led by the Lopez family, said consolidated net income during the nine-month period rose 22 percent to P1.89 billion. It said growth was fueled by strong regular advertising revenues as well as election-related spending.
The company, during this period, generated revenues of P25.23 billion, up 16 percent.
It said advertising revenues hit P14.77 billion, for a gain of 20 percent while consumer sales rose 11 percent to P10.45 billion.
“SkyCable continues to be a major driver of growth with revenues increasing by 21 percent to P4.98 billion. The growth in SkyCable revenues is partly attributable to the acquisition of Destiny Cable,” ABS-CBN said. Total costs and expenses were also up 15 percent to P22.75 billion.
