Nine Entertainment Co has downgraded its financial year 2016 results forecast after a poor third quarter in which television revenues were down by 11% y-o-y. The broadcaster says this was due to a sub-standard summer of cricket and worse than expected start to the ratings year.
As a result, Nine's share price plummeted 23.7% to $1.16 yesterday, while rival Seven fell 10.5% to 89.5c.
This year, several Nine shows, including a reboot of Australia's Got Talent, The Farmer Wants a Bride and Reno Rumble have struggled to challenge Seven's dominance with My Kitchen Rules in the coveted 7.30pm slot.
Cricket, a usual ratings winner, has not gone to plan with 30% of playing days in the test series against the West Indies and New Zealand wiped out by rain or early finishes. TV audiences were also affected by poor opposition in the West Indies.
Nine's late negotiation of TV rights for the T20 World Cup, which just concluded on Monday morning, made it difficult for the broadcaster to fully commercialise that event compared to last year's 50 over Cricket World Cup.
AdNews reported that 9Life, You're Back in the Room and the network's rugby league coverage have been rare bright spots.
As a result of this, Nine Network expects its share of the free-to-air advertising market to be 37% this year. Digital revenue through Mi9 is also trending down and Nine is looking to cut TV costs by 4% to help offset the reduction in revenue.
Nine's full year results will be released on 25 August 2016.
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