ABS-CBN losses swell while GMA income tumbles

MANILA, Philippines — The absence of political advertisements put a strain on the earnings of media giant GMA Network Inc. last year, as former rival ABS-CBN Corp. continued to absorb the losses of its broadband and cable television unit.

In separate stock exchange filings, Gozon-led GMA saw earnings dip by 42 percent to P3.17 billion while Lopez family-led ABS-CBN said net losses widened to P12.8 billion from P2.6 billion previously.

Both companies also saw declines in revenues.

GMA’s revenues slid by 13 percent to P18.64 billion as advertising sales dipped to P17.18 billion from P20.23 billion.

“The absence of a little over P3 billion worth of political advocacies and advertisements made a huge dent on the company’s top line,” GMA said, noting that flagship channel GMA 7 and its radio segment were hit the hardest.

READ: Weak ad earnings hit ABS-CBN, GMA Network bottom lines in H1 2023

Advertising sales accounted for more than 90 percent of the company’s P18.64-billion revenues last year.

Impairment costsABS-CBN’s revenues, on the other hand, were relatively flat at P18.51 billion from P18.55 billion. Its filing showed that while regular advertising revenue increased by 16 percent, this was offset by a decline in consumer sales.

Impairment loss

Still, a P9.1-billion impairment loss in broadband and cable television unit Sky Cable was the biggest factor in ABS-CBN’s negative performance in 2023.

An impairment refers to the permanent reduction in the value of an asset.

To recall, ABS-CBN in February canceled the P6.75-billion sale of the cable firm to Manuel Pangilinan-led PLDT Inc.

READ: GMA Network-ABS-CBN deal a win-win for erstwhile rivals

Analysts have said that the termination of the deal, which the parties said was mutually agreed upon, would force ABS-CBN to look for other ways to settle its debt obligations.

As of end-2023, its debt obligations stood at P12.6 billion.

ABS-CBN said it was now in talks with its lenders to settle its debts by June 30 this year, a six-month extension from the previous Dec. 31, 2023 deadline.

Meanwhile, ABS-CBN’s production costs for prime-time programs and movies also expanded by 2 percent to P7.41 billion, while that of GMA climbed to P8.17 billion from P7.48 billion.

The two companies have been collaborating in recent years following the denial of ABS-CBN’s franchise.

Early this year, the popular ABS-CBN noontime show “It’s Showtime” officially aired on GMA 7, replacing “Tahanang Pinakamasaya.” —MEG J. ADONIS