Seven West Media now expects the TV advertising market to be "flat to negative", after previously forecasting the advertising market would go in the other direction and has tipped a 10% profit fall because of it.
Speaking at the company's annual general meeting this morning, CEO Tim Worner told shareholders that the company now expected “flat to slightly negative” growth in the TV advertising market for the 2015 financial year.
Chairman Kerry Stokes said the softening of the ad market was unexpected.
“Unfortunately the whole market is down. I can't speak for other TV companies but we saw a softening market, which was unexpected.”
However, he said the reduction in advertising revenue was “nothing to be concerned or unduly worried by”
Seven West had previously told the market that it expected the TV advertising market to be flat with slight growth expected, but pointed to a difficult first half of FY2015 as a reason for re-casting its expectations.
Worner said Seven West's net profit in the December half of 2014 would be 10% lower than in the previous corresponding period, saying this difficulty was behind the revised forecast.
However, he denied this would impact on previous profit guidance pointing to the effect of Seven West's cost cutting focus.
Worner said growth in costs would now only go up by 1% , rather than growing at rates tied to the consumer price index.
Meanwhile it was quiet on its plans to establish a streaming service, with Stokes taking a cheeky pop at Nine and Fairfax's Stan platform.
“I have a problem with Stan,” he said. “I thought that was the last part of the name of countries I don't like.”
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