Nine Entertainment Group chairman Peter Costello was the first speaker at the Nine Annual General Meeting held before a small group of shareholders inside Nine’s North Sydney tower.
The full Nine Entertainment board was in attendance, joined by the recently appointed board member Mandy Pattinson.
“In FY23, Nine successfully built audience share and revenue share across all our key platforms,” Costello told visitors and the bigger online audience.
“We have a strong balance sheet and unrivalled diversity in Australian media. Our focus is to create the best content, distribute it broadly and thereby engage our audiences and advertisers. In particular, we continue to use our premium content to build our digital future.
“FY23 was more challenging than FY22. The local economy stumbled against a backdrop of higher inflation and rapid interest rate rises. Nine performed well, maintaining revenue on FY22 and taking market share.
“There was some cyclical softness in advertising markets, but Nine’s ability to create and monetise the best content was reflected in clear share gains across our unique suite of platforms – television, radio and publishing. In FTA, our metro market revenue share was above 40% in FY23, which is the highest share recorded by any broadcaster for at least 20 years. We reported growth in digital revenue and EBITDA from our wholly owned businesses, and our success in diversifying the drivers of revenue is shown by subscription revenue now contributing 28% of the wholly-owned total.
“Content is the key to Nine’s business and will be instrumental in our future success. Across all our platforms – total television, radio, publishing, Stan and Domain – Nine is focused on our audiences, the content they want, and how best to distribute and monetise it.”
Mike Sneesby on Nine performance, Paris and profits
Chief executive Mike Sneesby spoke at length recapping Nine’s FY2023 results. Summing up that performance, he said:
“Through FY23, Nine has continued to solidify its position at the forefront of media in Australia and further build on its digital strength. Whilst we have faced tougher economic conditions which have impacted the broader industry, Nine has risen to the challenge, continuing to drive audience and revenue share and invest in the future of the business. In FY23, Nine’s EBITDA and net profit were both our second strongest on record, beaten only by FY22’s record results.
Nine’s evolving business model
“Nine’s business model continues to evolve as the market embraces the digital delivery of our premium content. We believe that we are at the forefront of the Australian media market and our outperformance against our traditional peers is tangible – in digital television, audio and publishing our share in digital against our traditional peers is markedly higher than our historical share. We are proud of our progress as our business extends across multiple digital platforms.”
See also: Nine Entertainment results – Net profit drops 25%, but grows audience and revenue share
Nine CEO Mike Sneesby
Top photo: Nine board [L-R] Catherine West, Mickie Rosen, Mandy Pattinson, Sam Lewis, Andrew Lancaster, Mike Sneesby, Rachel Launders and Peter Costello
Nine’s preparations for Paris 2024: Advertisers already on board
Sneesby explained: “Across our broadcast and streaming television, audio and publishing, Nine will bring the Paris Olympics and Paralympics to all Australians, with an unprecedented cross-platform strategy – we will deliver more content from the Olympic and Paralympic games with greater opportunities for commercialisation than ever before.
“We have recently gone to market with the first wave of commercial opportunities for advertisers. We have developed a powerful games advertising proposition which is built on Uniting Australia through our unrivalled content offering. Our proposition includes an almost 10 month marketing platform for advertisers – the Road to Paris – starting with the Gangwon Winter Youth Olympic Games in January and running all the way through the Paris Olympic Games and culminating with the Paris Paralympic Games in September.
“We have presented our full integrated Olympics partnerships to all IOC and AOC partners as well as a range of Australia’s largest advertisers and the results to date have been very pleasing. We have a number of partnerships confirmed and we are on track to sell all major partnership and sponsorship packages. We are also confident that progress in our commercial partnerships around tentpole assets like the Olympic and Paralympic Games will contribute further to underlying revenue share performance across all of our platforms.”
AI-driven initiatives coming throughout 2024
“AI also drives content recommendations on Stan, 9Now and on our publishing sites which helps to acquire audiences and increase their consumption across the Nine ecosystem,” said Sneesby.
“It is key to our recent launch of the ‘listen to this article’ text to audio feature available on the AFR, The Age and The SMH – the first phase of our generative AI tools and a likely precursor to new products that can further customise content to each reader’s preference and habits.
“It is also helping us produce our sport ‘Minis’ on 9Now and Stan, condensing full games into 20-30 minute packages, increasing engagement by offering new consumption alternatives to our premium sporting content. This was particularly successful with the recent Ashes series where consumers could catch up on a whole overnight session from the UK in around 40 mins the next morning.
“What is significant about a number of these initiatives is that they are utilising Nine’s existing premium content from all platforms to develop new products and applications and ultimately generate revenue.
“We will continue to roll-out AI-driven initiatives throughout 2024 with the goal of creating more relevant content in more formats with greater efficiency, increasing the amount of time our audiences spend with us and building more advertising products that deliver outcomes for our clients.”
Nine current trading: Q1 FTA revenue TV down 12%
“Across Nine’s wholly-owned businesses, operating performance for the first quarter was broadly consistent with the comments made at our FY23 result in August,” said Sneesby.
“The Nine Network and primary Channel Nine are once again expected to win the metro TV and BVOD ratings in all of our targeted demographics for calendar 2023.
“The metro FTA television market however, remains challenging, with Q1 revenues down around 12%. While September showed some improvement on the rate of decline in July and August, Nine has seen no discernible improvement into the December quarter.
“By contrast, in the September quarter, 9Now’s revenues and the BVOD market, continued to grow in the low-mid teens on a percentage basis.
“Nine is continuing to focus on the costs and efficiency of the group’s total television business. We are now expecting total TV costs to be slightly down in FY24 on pcp, excluding the NRL step-up and the cost of additional cricket. Ongoing cost initiatives across total television are expected to enable us to more than absorb inflationary costs, as well as our material investment in technology, including cyber security.
“Nine Radio’s Q1 advertising revenues declined by around 3% on pcp, supported by strong growth in digital revenues, and with an increasing contribution from live audio streaming.
“Stan’s paying entertainment and sport subscribers have shown clear growth since our result in August, driven by exclusive content, including the Rugby World Cup, the return of the UEFA Champions League and the Stan Original series C*A*U*G*H*T as well as exclusive licensed shows. We continue to expect that higher ARPU and paying subscribers will drive further growth in both revenue and EBITDA in FY24 for Stan.
“Nine’s publishing business continues to benefit from its focus on quality, differentiated journalism, with strong digital subscription revenue growth of 12% in Q1, slightly ahead of earlier expectations. Nevertheless as cited in August, given the challenging digital advertising market, we continue to expect FY24 publishing EBITDA to be slightly ahead of the H2 FY23 run-rate.”