Nine Entertainment has withdrawn its profit guidance in an advertising market now being influenced by fallout from the coronavirus.
In February the company warned of advertising market conditions across most categories being softer-than-anticipated
for the start of 2020.
Then it was forecasting full year earnings to be flat, similar to the 2019 EBITDA (earnings before interest, taxes, depreciation, and amortisation) of $423.8 million.
Now the media group says it can't stick to that guidance because the rapid progression of COVID-19 is starting to have an impact on Nine’s markets.
"The short term impact remains limited to date, with Nine’s March quarter FTA ad revenues continuing to track close to flat and overall results for the quarter broadly in line with company expectations," the company told the ASX.
"However, the forward ad market is becoming increasingly difficult to reliably predict. As a result of this Q4 uncertainty, Nine considers it prudent to withdraw its FY20 guidance."
"Notwithstanding this advertising market uncertainty, Nine’s audiences across all key businesses continue to perform well, and the company remains very focused on bringing forward cost efficiencies where possible."
Nine in February posted a 5.3% lift in headline profit after tax to $114 million, within analyst expectations, as the media company continues its repositioning for a digital future.
Revenue was up 67% to $1.18 billion. Statutory profit was $101.9 million. The company declared a fully franked dividend of 5 cents.
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