GMA Network slashes 2020 spending
Television giant GMA Network Inc. is reducing spending this year due to the new coronavirus pandemic.
In an email to the Inquirer, GMA chair and CEO Felipe Gozon said the company would defer some P376 million in capital spending for 2020. The amount was mainly allotted for equipment upgrades.
He said the bulk of the company’s spending budget of P834 million would be used for its digital television transmitters.
During the company’s annual meeting on Friday, Gozon said GMA Network was affected by strict COVID-19 quarantine measures imposed in March.“We also suffered setbacks in revenue that went along with the closure of some business activities,” Gozon said. He said businesses in the country were also hit by the lack of transportation and the lockdowns imposed around the Philippines.GMA Network’s first-quarter earnings fell 19 percent to P583.4 million while revenue hit P3.25 billion, down 7 percent. This was mainly due to the absence of political-related advertising that boosted earnings last year.
The full impact of the enhanced community quarantine will be seen in the second-quarter results.
In a stock exchange filing, however, Gozon said the company could still end 2020 with profit higher than 2019 level. He cited steady revenue and “cost-cutting measures” being implemented by the network.
The slowdown in expansion casts doubt on GMA’s ability to absorb displaced workers from ABS-CBN Corp., which announced mass layoffs after 70 lawmakers voted to deny the company a new 25-year franchise on July 10.Gozon declined to comment on whether GMA could hire ABS-CBN workers affected by the decision.
The boost in spending on digital television, meanwhile, comes as the company launched its Affordabox, a plug-and-play device that connects to an analog TV set and allows it to receive digital broadcasts.Gozon said the device— the company’s response to the ABS-CBN TVPlus—is seeing a surge in sales. INQ
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