HT&E CEO Ciaran Davis describes ARN’s regional network as “a cracking business”.
Half year results show how positive, and above expectations, the $307.5 million acquisition of regional radio player Grant Broadcasters and its 46 stations has been for the ARN radio business.
Regional radio revenue was up 11% to $54.2 million in the six months to June, compared to a 5% rise to $97.2 million for ARN Metro.
The integration program is ahead of schedule. Key milestones have been achieved and revenue synergies of more than $2.7 million delivered, giving confidence to hit the $6 million-$8 million target for 2022.
This is in the context of a 58% lift in revenue to $172 million for the half year to June. Net profit more than doubled to $26.6 million. The company declared a fully franked interim dividend of 5 cents per share and reinstated a buyback to support "undervalued" share price.
Davis told AdNews a key to the acquisition was the ability to merge regional and metro markets.
The company has just brought together the agency sales steams, regional and metro. Make an ad booking for both in the one place.
“The first six months are a very good result,” Davis says.
“We were very conscious from when we bought it that we wanted it to continue to perform as well as it has. And it's a testament to the people there that they have done that.
“All in all, the integration has gone well from a revenue perspective. But it's also gone well from it for people integration, process, organisational development. There's genuine excitement about what we're trying to do and what we're building and everybody's leaning into it.”
He says regional Australia is doing very well, with a population spending and engaged with local radio.
“I'm talking to investors and talking to the importance of regional Australia to the community, to advertisers, to the economy," he says.
“It’s got higher disposable income, a lower cost of living, a fantastic demographic and a fantastic population reach.”
Advertising market
Davis: “The total ad market (in July) just took a bit of a break, probably post the end of financial year, which tends to happen sometimes.
“But the trading of the )September) quarter is looking 6% to 8% up.
"And while we don't usually have visibility beyond sort of six or eight weeks, the briefing activity is good. So it's pointing in the right direction still, which is very positive.”
A slide from HT&E's results presentation:
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