HT&E's ARN reported a "soft" market in March, sending the radio group's first quarter revenue down 5% on expectations.
CEO Ciaran Davis says first half cost savings of about 2% will mitigate the impact on earnings.
"We continue to pursue cost savings in both radio and at the corporate office," he told the company's AGM.
The prospects for the second quarter are better, with an improvement in trading in April, but still revenue is expected to be weaker than last year.
"Based on forward bookings into May and June, we expect H1 revenue to be 2-3% behind the prior year," he says.
HT&E joins other media groups, including Macquarie Media, in reporting a challenging market in the first three months of the year.
Davis says the company is building a digital audio business but he is conscious of maintaining a focus on core radio assets.
Seven out of 10 users say they listen to AM/FM radio on their smart speakers, he says.
In March, ARN's digital audio streaming site iHeartRadio produced more than half a million listening hours.
"Audio consumption is evolving," he says. "And although consumer uptake will accelerate, usage will take time to build. But we are investing today to build out a unique audio proposition. And become a truly digital audio business for the future."
HT&E is also reviewing its smaller digital investments to assess their synergy and how shareholder value can be maximised.
These investments include esports business, GFinity. Its first city-based esports league, generated a reach of 3.5 million in Australia.
Another is Unbound, a creative technology business in the virtual and augmented reality space. It's a content driven
strategy with a subscription, pay-per-view and advertising model.
HT&E also has a 25% shareholding in Soprano, an instant messaging software business. In 2018, Soprano paid HT&E a dividend of $1.25 million.
"The review of these assets is underway and we expect to have made significant progress by the end of 2019," says Davis.
In 2018, HT&E reported a 5% lift in revenue to $272 million. Net profit after tax was up 23% to $37 million.
The company is now debt free following the sale last year of its street furniture business Adshel to Ooh!Media for $570 million.
HT&E, formerly known as APN News & Media, a regional newspaper group, says it has now eliminated all exposure to newspaper advertising. Debt has been reduced from $400 million to $128 million in net cash and 87% of revenue comes from ARN.
Here's how the revenue mix has changed over the last five years:
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