TVNZ has revealed an operating loss of $4.6 million for the six-month period to the end of December in half-yearly results published this morning.
Total revenue of $155.9 million was down 13.5% on last year, blamed on “a challenging trading environment” with television advertising revenue significantly down, while digital revenue continues to increase year-on-year.
TVNZ reported earnings before tax (EBITDAF) of $0.1 million and an operating loss of $4.6 million. It also recorded an impairment of $12.2 million, reflecting the falling value of the company overall, and this resulted in a net loss after tax of $16.7 million.
The announcement comes just two days after Newshub’s owners Warner Bros. Discovery said it was planning to shut down news operations on rival channel Three at the end of June due to "the downturn in the TV advertising market".
TVNZ chief executive Jodi O’Donnell said: "Digital generates nearly a quarter of TVNZ’s advertising revenue, and this percentage is increasing year-on-year.
"The challenge we’re facing into is growing these digital revenues at a faster pace than TV revenues are declining. TVNZ is building a future beyond broadcast television and today’s results show the need for us make this transition faster."
TVNZ's operational expenses of $155.7 million were $10.7 million lower than the same period last year as it continues to cut costs.
O'Donnell added: “TVNZ is part way through an all-of-business digital transformation. This multi-year project will move TVNZ from a broadcast organisation with digital bolted on, to a future-focused media entity with digital at its core.”
She said she expected the second half of the year to continue to be challenging and further cost cutting would be needed.
"While we hope to see some improvement in the advertising sector in late 2024, we anticipate market disruption from global streaming services and social media platforms to continue, and this means standing still is not an option," she said. "Ultimately, we need to get our organisation into the right shape and the right size to compete in a digital world."
All media companies are facing falling advertising in a tough economic climate, with revenue moving to international players like Google and Meta, owners of Facebook and Instagram.
The scale of the issue was laid bare at a select committee hearing into the Fair Digital News Bargaining Bill last month where News Publishers Association chairperson Sinead Boucher said some media organisations “are clinging on by their fingernails”. She said: "In some cases, they feel like they are really losing that battle in the near future."
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