Matt Stanton.
Nine Entertainment’s December half results turned into the perfect platform to pitch for the chief executive role at the media group.
Matt Stanton, as acting CEO, had a clear advantage over anyone else being considered to run Nine. He had been reviewing operations and knew the numbers intimately.
Releasing the half year numbers to the ASX, Stanton also pitched his vision, the strategy for Nine.
The top line: “We will deepen our connection with audiences and advertisers by harnessing our unique data and premium content to drive growth.”
And the board of directors bought the pitch. “After developing the group strategy, Matt has a deep understanding of Nine, our priorities, culture and people and has earned the respect of the senior leadership, the broader workforce, the market and the board,” said board chair Catherine West.
Stanton’s strategy calls for a full frontal attack on costs, to the tune of $100 million.
“We are reshaping the business in recognition of shifting consumption patterns towards digital video, a changing mix of short and long form content and convergence of delivery platforms,” Stanton then told market analysts in a briefing.
The plan is to shift from a platform-led to a “simpler, more consumer-led” operating model.
That means three units: Streaming & Broadcast; Publishing; Marketplaces. The creation of a streaming and broadcast division is the first step.
Market analysts generally applauded the cost cutting, and many were pleased with the unexpected volume of red ink.
They have also started to cautiously talk about a stabilisation of the advertising market for television.
Stanton told the market that total TV ad revenues expected to grow in the high-single digits March quarter but it was too early to estimate the June quarter “given limited visibility”.
The other big positive for Nine, and a good reason to keep the acting CEO in the chair to ensure the best value is extracted from any deal, is the takeover bid for Domain. Nine's 60% share could be worth $1.62 billion.
“Current trading is encouraging and cost-cutting is ramping up,” said Morningstar’s Brian Han. “The recent takeover bid for Domain highlights the underlying asset value.”
Stanton, as he starts the long run with his hands fully on the reins, got an early fair wind with an official interest rate cut.
“The advertising market is generally an early winner in rate-cut cycles, and sees a multi-year tailwind,” said Macquarie analysts looking at media company results.
Stanton, whose vision statement at the results also included working to cleanse Nine of bullying and toxic management, sent a message to staff on the announcement of his appointment.
“I’s an enormous honour and privilege to be appointed to lead this company, Australia’s biggest and most successful media business, and we have an ambitious transformation agenda to ensure we are best positioned for the future,” he said in an email.
“The external environment for all media companies is tough, and we must continue to reset and reshape Nine to ensure we thrive.
“I recognise that change is not easy, but you have collectively embraced the challenges we face as a group and we are already seeing improvements across the business and in your workplaces.
“You have my commitment that I will be working every day to make Nine better for you, as well as our advertisers, audiences, stakeholders and owners – Nine’s shareholders.”
A slide from Nine's half year results to December 2024:
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