TVNZ Annual Result 2007

TVNZ Annual Result 2007

TVNZ has announced an operating profit of $9.3 million on revenue of $375.2 million for the financial year end 30 June 2007, and a net loss after tax of $4.5 million following a one-off restructuring charge of $11.1 million.

Advertising revenues declined 6.5% to $312.8 million for the year.

TVNZ Chief Executive Rick Ellis said the result reflected a soft advertising market, channel performance issues now being addressed, and costs associated with implementing an organisation redesign.

"The 2007 financial year result reflects the realities of the business a year ago and the cost and investment in restructuring and repositioning required to restore TVNZ to health and position it for leadership in the digital era," Mr Ellis said.

"Despite a difficult trading environment the company has made great progress during the year in implementing the new strategy 'Inspiring New Zealanders on every screen', and improving the performance of the television business.

"We made the big strategic call to change now rather than to cruise along and allow the changing media environment to overtake TVNZ. We could have sat back, not changed anything and made a short term profit. But we made the judgment that the long term health of the organisation required change now.

"The one-off restructuring and other savings have delivered significant ongoing future cost reductions to TVNZ – some $17 million per annum.

"The TV ONE turnaround is now well underway, and advertising revenues are forecast to rise year on year for the first quarter of the 2008 financial year. Increased performance coupled with sustainable costs is set to return TVNZ to profitability in the 2008 financial year and expects to achieve the shareholder's target return on investment rate in the 2009 financial year."

He said TVNZ invested in a number of initiatives targeted at growing future public and commercial value through increased accessibility of its programmes and content via more channels, web portals and screen devices.

"The company played a leadership role in the launch of the Freeview digital platform and secured government funding for two new digital channels, TVNZ 6 and TVNZ 7 that will be predominantly local content and be advertising free."

In addition the Board approved investment in excess of $30 million in digital infrastructure for news, digital channels, widescreen television, for satellite news gathering kits and for the tvnzondemand platform.

He said as New Zealand's television public broadcaster TVNZ continued its commitment to local programming, spending close to $130 million in the 2007 financial year.

In the 2008 financial year TVNZ will spend approximately the same – more than $25 million from New Zealand On Air, Te Mangai Paho and Direct Government Funding and more than $90 million of TVNZ's own commercially earned revenues.

"The 2007 financial year has very much been a planning and transition year. The 2008 financial year will be about executing to the plan and the 2009 financial year will be about accelerating growth.

"With a new strategy and with a capable and committed leadership and staff in place, the company looks to the future with confidence and enthusiasm."

TVNZ – FY07 Highlights

•The launch of TVNZ's new five year strategic plan, "Inspiring New Zealanders on every screen".

•An investment of approx. $130 million, of which approx. $100 million was from TVNZ's commercially earned revenues, into local programming to create 4832.7 hours of local content – more than three times more than TVNZ's nearest rival.

•18 of the top 20 programmes on TVNZ channels.

•ONE News won "Best News" at the Qantas Television Awards.

•The launch of New Zealand's first free daily podcasts.

•A record audience of close to 1 million New Zealanders watching the final of Dancing With The Stars.

•Five and a half hours live coverage of the tangi of the Maori Queen Dame Te Atairangi Kaahu on TV ONE and streamed on tvnz.co.nz. An educational DVD of the tangi, along with highlights from the earlier broadcast celebrating Dame Te Ata's 40 years on the throne, was released later.

•The live broadcast of the unveiling of the New Zealand memorial at Hyde Park

•More than 180 hours of live and highlights coverage from the America's Cup in Valencia.

•Local drama Karaoke High was streamed on tvnz.co.nz one week ahead of its launch on TV 2.

•The 30th anniversary of Fair Go, the 20th anniversary of Tagata Pasifika, the 15th anniversary of Shortland Street and the 100th episode of Eye to Eye.

•The launch of TVNZ ondemand.

•Shareholder agreement to invest $79 million over five years, on top of TVNZ's investment of $32 million from its commercially earned revenues, for two new digital channels.

•The launch of the Freeview digital platform.

•Board approval to upgrade TVNZ's digital infrastructure, including a new $20 million digital playout facility and more than $7 million for a new digital editing system for news and current affairs and extra Satellite News Gathering capability.

•Commercial agreements with Google, Fairfax and Yahoo!Xtra for the use of TVNZ content.

ENDS

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