NZME’s publishing digital subscriptions, including those for nzherald.co.nz, now sit at 179,000, the company revealed today, with digital revenue now making up almost a third of the company’s income.
The media firm - owner of the NZ Herald, Newstalk ZB, a suite of entertainment radio stations and property portal OneRoof- has today opened the hood on its business and revealed a new three-year future strategy as part of its 2023 investor day presentation.
The presentation highlights how tough 2023 has been economically - digital publishing revenues (advertising and publishing) are shown to be flat - and reiterates the market announcement last week that Ebitda for the full year is now likely to be between $57m-$59m rather than the earlier guidance range of $59m-$64m.
“Business confidence has improved significantly, but consumers are still hurting and wary,” NZME says in one of its investor day slides provided via the NZX this morning.
NZME announced last week that advertising revenue was down 7 per cent in the first half of 2023.
It said today advertising revenue was returning to growth, but not consistently.
Nevertheless, the company is bullish about the next three years across all three of its pillars - audio, publishing and OneRoof.
NZME editor in chief Murray Kirkness (left) with editorial staff (from left) Anne Gibson, Damien Venuto and Julia Gabel.
NZME announced it had organised its publishing division into separate print and digital business units to accelerate its digital-first approach. It reveals print publishing’s Ebitda was $28.2 million in 2022 while digital publishing’s Ebitda - taking into account the cost of running almost all of the newsroom - was $11.5m.
“The digital business is now funding journalism into the future,” NZME chief executive Michael Boggs told investors today.
The company has 221,000 subscribers overall, including 179,000 digital subscribers. This includes nzherald.co.nz, Viva Premium and BusinessDesk subscribers.
NZME believes the total addressable market for digital news subscriptions in New Zealand is one million.
Of the 179,000 digital subscriptions today, 123,000 are digital-only (the other 56,000 are print subscribers who have activated a digital subscription). NZME is aiming for 190,000 digital-only subscriptions by 2026.
In one slide today, it teased a new-look nzherald.co.nz homepage, and one possible design with a mix of curated and personalised journalism.
NZME teased a new-look nzherald.co.nz homepage - and one possible design - at today's investor day presentation.
The company is also placing high hopes on OneRoof as a high-value asset.
The company says OneRoof is delivering “strong results” with an improving property market.
“Quarter 3 saw OneRoof digital revenues increase by 16 per cent year-on-year despite listings being subdued. Quarter 4 has started well, with October delivering year-on-year growth of 23 per cent,” the company said.
In the audio division, there is a big focus on the rise of digital audio including podcasts, while in terrestrial radio it is focusing on growth for The Hits and Coast.
The Hits breakfast hosts Jono and Ben.
Boggs said digital revenue was forecast to be 29 per cent of NZME’s total revenue in 2023, more than double the percentage of total revenue since 2019.
“Digital revenues have shown strong growth over recent years, reflecting the strength of NZME’s strategy and platforms. We remain committed to growing digital revenues - it is core to the future improved profitability and sustainability of our business, and to delivering value for our shareholders,” he said.
“We are pleased that across the business we are growing the digital mix of revenue. In digital audio, we have more than 70 per cent market share versus our key audio competitor, and we believe there is potential for rapid growth.
“Digital revenues within publishing advertising and reader revenue have now significantly changed the mix of print versus digital revenues. NZME’s publishing division is now organised into separate digital and print units - a true digital-first model. Given this, a profitable digital publishing business is now visible from an operational and profitability perspective and it is now funding the leading journalism produced by NZME.
“Finally, a transformational change is happening at OneRoof due to the growth in our digital property platform, which is setting that division up for future success.”
NZME’s share price opened at 83 cents on Wednesday morning. It was up seven cents, to 90 cents, just before 2pm.
Editor-at-Large Shayne Currie is one of New Zealand’s most experienced senior journalists and media leaders. He has held executive and senior editorial roles at NZME including Managing Editor, NZ Herald Editor and Herald on Sunday Editor and has a small shareholding in NZME.
