The Craig Hutchison-led broadcasting Sports Entertainment Network (SEN, ASX: SEG) group has managed to post revenue growth year-on-year. However, the costs associated with its expansion have cut into earnings.
Revenue was up 8.3% to $118.0m for the year ended June 30, 2023. Operating expenses ballooned 23% though to $116.1m. Leaving an EBITDA of just $1.9m.
Sports Entertainment Group alerted the market to the impending result with guidance on June 22.
The company has reported “strong revenue growth” across the SEN, SENTrack and SEN Spirit brands on audio and digital platforms.
The broadcaster has been something of a pioneer in the digital space and it reported:
Digital audience consumption via the SEN app, www.sen.com.au, podcasts and social media platforms experienced 1.4 million monthly average users and a 27% increase in revenues. The introduction of streaming listeners to traditional radio surveys of AM, FM and DAB+ and the introduction of podcast metrics in 2024 should have a positive impact on revenue, particularly in our Sydney and Brisbane expansion markets.
Regarding the extra costs, SEN noted it included:
$4.7 million associated with the establishment of new assets in Sydney, Brisbane and New Zealand. To establish brand awareness and attract audiences, and initial revenue in these markets we have incurred up-front costs associated with but not limited to talent, content, broadcast rights, sales, programming and support personnel.
SEN strategy update
The financials for the full year included an updated strategy:
SEN established a national network of owned stations with the addition in July 2022 of SENQ 693AM in Brisbane, which completes a key part of the owned commercial licence station network on the east coast of Australia in the AFL and NRL heartlands of Melbourne, Sydney and Brisbane.
The latest acquisition completes our “on-the-dial” offering to listeners as we continue to invest and develop our “on demand” offerings via our web, app and social media platforms where we are experiencing quicker growth in users and listeners. The introduction of streaming metrics to ratings surveys which advertisers base their investment decisions on will benefit SEG’s ability to monetise its digital assets as its radio assets continue to build brand awareness and audience.
Our ambition to build a specialist sports media and entertainment business in Australia and New Zealand is complete as represented by the illustration below.
The next phase of our strategy is about leveraging our investments to date to deliver a financial payoff as our assets mature by continuing to build brand awareness and listeners, increasing advertising revenues and generating margins.
Sports team ownership: Netball next
SEN reported its sports team investment experienced growth with the performance of the Perth Wildcats enabling investment to support the smaller Bendigo Spirit, Otago Nuggets and Southern Hoiho franchises. “We look forward to the addition of the 8th Suncorp Super Netball franchise in January 2024 to our expanding SEN Teams business, currently comprising four basketball teams.”
Photo: SEN chief executive Craig Hutchison
See also: Craig Hutchison: 50+ radio stations, podcasting, cricket, football & SENtrack