Trading of ABS-CBN shares resumes Monday
Media giant ABS-CBN Corp. will resume trading on Monday after complying with the disclosure requirements of the Philippine Stock Exchange (PSE).
Trading of ABS-CBN’s shares had been suspended for eight days.
The PSE imposed a trading halt on May 6 after seeking added information on the impact of the National Telecommunications Commission’s (NTC) cease-and-desist order against the company.
The NTC said ABS-CBN’s Congressional franchise had expired on May 4 and thus it must stop radio and television broadcasts.
This would have a material impact on the company and ABS-CBN’s disclosure on Friday—a requirement before the trading suspension is lifted—explained why.
In the filing, ABS-CBN said free-to-air advertising from television and radio accounted for 50 percent of all revenues as of end-September 2019.
The business falls under ABS-CBN’s core media, networks and studio entertainment operations. As of September last year, these amounted to P23.3 billion, of which 68 percent came from free-to-air advertising.
“Even as the impact of the COVID-19 pandemic on the Philippine and global economy is yet to be fully realized, the order will put additional financial burden on the company,” ABS-CBN said in its filing.
ABS-CBN also provides cable TV and broadband services, which were unprofitable as of the third quarter last year. It likewise runs the indoor theme park KidZania Manila, which said on Friday it would remain closed until Aug. 15 to prevent the spread of COVID-19.
ABS-CBN’s disclosure to the PSE comes two days after the House of Representatives moved to grant the media giant a provisional franchise lasting until October this year. This will also pave the way for the company to continue its broadcasting services.
While advertising delivers the bulk of revenues, ABS-CBN said it continues to explore new ways to earn such as expanding its digital presence. ABS-CBN is also cutting costs and “rationalizing” capital investments, the filing showed.
It also committed to continue paying its debts to creditors. Long-term debts as of September last year amounted to over P21 billion.
In its filing before the Supreme Court challenging the NTC’s order, ABS-CBN said it was losing up to P35 million daily from the closure of its broadcasting business.