Optimistic CanWest on the rise

By SIMON HENDERY media writer

Canadian broadcaster and publisher CanWest is talking up the prospects for its New Zealand business after buying a new FM radio frequency in Auckland.

CanWest Global Communications runs the TV3 and C4 television stations and several radio networks, including More FM, Radio Pacific, The Rock and The Edge.

It spent $6.3 million last month to secure one of two Auckland FM frequencies put up for auction by the Government.

Its rival, The Radio Network, won the other frequency with a $6.5 million bid.


Yesterday, CanWest president and chief executive Leonard Asper said the acquisition of new radio frequencies in New Zealand "will add market strength to us - in Auckland particularly, where we had the lowest market share of all of our markets compared with our competitor.

"It will give us a real leg-up there to close the gap."

The acquisition has to be cleared by the Commerce Commission but CanWest intends to use its frequency to bring its easy listening format station, The Breeze, to Auckland.

The company issued its first-quarter results yesterday - in Canadian dollars - showing a strong performance from New Zealand operations, helped in part by the strengthening kiwi dollar.

New Zealand revenue rose 19 per cent to C$52.3 million ($59 million) and operating profit was up 35 per cent to C$17 million.

CanWest said foreign exchange gains from its New Zealand and Australian businesses contributed about C$4.5 million to earnings during the quarter.

Worldwide net earnings for the quarter were C$81.5 million.

The New Zealand accounts remained strong in kiwi dollar figures, supplied by local chief executive Brent Impey.

Revenue from television for the three months to November 30 was $38.1 million, up 10 per cent on the same quarter a year earlier.

Radio revenue increased 11 per cent to $26.3 million, and combined radio and television operating profit was up 25 per cent to $20.9 million.

Impey said the business was continuing to benefit from a buoyant advertising market.

CanWest replaced its loss-making TV4 format with music channel C4 in October.

Yesterday, Asper said the new channel had a "much better financial profile".

"Early ratings show that it has attracted a high level of interest from its target youth-orientated television audience."

Impey said C4 was already on track to becoming profitable.

TV4 and C4 made an operating loss of $440,000 during the November quarter - which included one month of the channel running as TV4 and two months as C4 - compared with a $1.7 million loss for TV4 during the same quarter a year earlier.

CanWest in NZ

Television

* TV3

* C4

* Property TV

Radio

* More FM

* Channel Z

* Radio Works

* Radio Pacific

* The Breeze

* The Edge

* The Rock

* Solid Gold

* local radio