HT&E's ARN is cutting costs with radio revenue down 5% in the four months to April, partly due to shrinking government spend and uncertainty impacting advertising sentiment.
Shareholders were told, in a trading update at HT&E's annual general meeting, that the drop to April would have been 2%, excluding the impact of government spend.
Against a strong election spend comparison in May 2022, radio revenue for May is pacing down 10%.
"In light of current trading, we have initiated temporary cost measures to limit total people and operating costs to near flat YoY for 2023," the company said.
In a shortening market, June bookings continue to build, and radio revenue is down low single digits. Digital audio revenues to the end of June are up 20%.
Shareholders were told HT&E is well positioned despite a challenging environment
"Our core radio business has been the foundation of our success for many years," says CEO Ciaran Davis.
"With a loyal listener base and established relationships with advertisers, we are well-positioned to leverage our strengths to continue generating strong returns."
SMI (Standard Media Index) figures show that the digital audio market was the fastest-growing digital market related to traditional content, up 30% in December 2022. PwC’s Entertainment and Media Outlook found that digital audio revenue including streaming is forecast to reach $3.7 billion by 2026.
"We’ve made considerable progress growing new digital audiences and revenue opportunities and we expect our digital audio operations to be earnings positive on or before the end of 2024," says Davis.
"The world of audio and audio entertainment has never been more exciting and we are at a point where advancements in technology such as AI, increased accessibility, and changing consumer preferences are all contributing to how audiences engage with radio and newer forms of digital audio content.
"As more people embrace podcasts, streaming services, and voice-activated devices, the demand for highquality audio content will continue to grow.
"This presents exciting opportunities for content creators, advertisers, and businesses to tap into the expanding audio market and engage with a highly receptive audience.
"At ARN we are building a vision that aims to provide the most complete audio experience for listeners, and the most comprehensive audio solutions for advertisers."
In February HT&E reported ARN radio revenue up 53% to $344.9 million in the year to December but profit suffered due to a non-cash impairment following a downturn in economic conditions.
Revenue was boosted by a full 12 months benefit from the acquisition of Grant Broadcasters and its 46 regional stations which the company says has proven to be an “outstanding investment”.
Net profit after tax was a negative $176.3 million, compared to a positive $14.9 million the previous year.
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