TVNZ lifts half-year net profit

A sharp lift in profit from its transmission business and a $6 million charter subsidy helped Television New Zealand lift its half-year profit 20 per cent.

The state broadcaster's December net profit rose by $4.7 million to $27.6 million for the six months to December 31, compared to the same period in 2002.

Revenue from the television business rose 6.8 per cent to $226.9 million with advertising revenue up 13 per cent to $185.8 million, thanks to a big boost in revenue in October and November, mainly due to Rugby World Cup coverage.

The television business contributed a net profit after taxation of $20.4 million, an increase of 10 per cent or $1.9 million.

The crown enterprise, formerly a state-owned enterprise, is given $12 million a year by the Government to help it meet charter obligations. TVNZ uses that money for new programming.

TVNZ's transmission business, incorporating Broadcast Communications, which has now been spun off into a separate state-owned enterprise, generated a net profit after tax of $7.2 million - up 64 per cent, or $2.8 million, on the previous year.

The transmission business' revenues have risen as a result of wireless broadband companies using its facilities.

Revenue for the transmission business was $60.2 million, up from $55.3 million during the previous year.

It will pay a $4.8 million half-year dividend while the television business did not pay a half-year dividend.

Chairman Craig Boyce said the increased profit for the period was testament to TVNZ's success in maintaining its commercial performance while delivering on its charter remit.

The high levels of growth experienced were largely driven by buoyant economic conditions and specific events.

He said that the company was making good progress towards fulfilling the Government-imposed charter while performing financially.

Boyce said the adoption of the TVNZ Charter in March last year had changed TVNZ's vision and focus as a public broadcaster.

But he warned that the charter would eventually have an impact on TVNZ's business.

"While the prevailing strong advertising conditions are allowing the company to step up its performance in relation to the charter, it needs to be borne in mind that these conditions are cyclical and will inevitably flatten," Boyce said.

"Technological developments are also occurring which will make it easier for others to enter the deregulated television broadcasting market, which is open and competitive."

- NZPA