Ads boost TVNZ interim profit

By SIMON HENDERY media writer

The rebounding television advertising market has boosted TVNZ's half-year profit, offsetting a fall in revenue from the state-owned broadcaster's satellite linking business.

Television New Zealand yesterday reported a $22.9 million net profit for the six months to December 31, up $8.4 million on the same period a year earlier.

Advertising revenue for the six months was up $6.8 million (4.3 per cent) to $164.2 million.

The company received $5.3 million in Government funding to cover its obligation under the TVNZ charter, which came into effect last month.

But "other external revenue" fell $11.2 million. The company's international satellite linking business, Satellite Services, dropped $4.6 million.

Satellite Services is part of the television side of the organisation, which has been split into two arms-length operations - its television business and its transmission business.

It organises satellite links for broadcasters of sporting and other events around the world but was hit last year by a dearth of major broadcast events and increased availability of bandwidth from international competitors.

TVNZ spokesman Glen Sowry said that while Satellite Services had built a niche business supplying satellite bandwidth, terrestrial cable, which could also be used by broadcasters, was now more available than it had been.

Net profit from the broadcast side of the business, which includes transmission business BCL, was down $1.8 million to $4.4 million.

Chairman Craig Boyce said: "While total operating revenues declined marginally during the period under review, this was more than compensated for by the reduction in operating costs and non-recurring costs which were associated with restructuring the television and transmission businesses in the previous year."

Revenue was down $1.6 million because of lower income from design-and-build projects.

The company said its Australian operation, TVNZ Australia, continued to perform strongly with several new analogue and digital transmission projects undertaken.

The company will pay its shareholder, the Government, a $3.1 million interim dividend.