Commentary

Key developments

Overall, the media sector in Australia and New Zealand have struggled to maintain their position over the last year well despite the deterioration of economic conditions. Economic growth is sluggish relative to previous years, and the impact on advertising continues to depress valuations for ad-dependent stocks.

Southern Cross Media

Southern Cross Media’s stock declined around 25% in the last month, after the company announced that ARN and Anchorage Capital Partners withdrew its original takeover offer for the business after a “deteriorating outlook for Regional TV” was established during due diligence. ARN and Anchorage Capital Partners submitted a new revised proposal which split out certain radio and TV assets from the deal. The offer was promptly rejected by Southern Cross Media. SCA Chair, Heith Mackay-Cruise said “the alternative proposal provides downside for SSC shareholders, even if the execution challenges could be overcome.”

News Corp

News Corp’s stock had a positive month up over 10%, with the company releasing its third quarter 2024 results. The results included total revenue down 1% pcp to $2.42b, and EBITDA up 1% pcp to $322m. The release pointed to the Dow Jones and REA segments driving growth within the group, while there were lower costs in the Book Publishing segment and gross cost savings related to the 5% headcount reduction initiative.

Ooh Media

Ooh Media’s stock fell 15% over the last month after investors reacted poorly to a trading update published by the company, which saw Q1 performance across classic inventory in Street Furniture and Retail down 33%. Despite this, the company’s revenue was up 1% on pcp on growth in other business areas.

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