(Toronto) Corus Entertainment’s CEO says the broadcaster is starting to see signs of improving advertising demand after a rocky 2023, but it’s too early to predict the timeline for a full recovery.
Recent strikes in Hollywood, which have since been resolved, led to lower revenue across all advertising categories in the company’s most recent quarter, which ended Nov. 30, the president and chief executive officer said Friday. directed by Doug Murphy.
He said some sources of advertising revenue have been affected by other factors such as higher interest rates and consolidation in certain sectors.
Mr. Murphy said Friday, during a conference call with analysts after the publication of first quarter 2024 results, that they would not be surprised to hear him say that “we are delighted to leave 2023 behind us” .
He said the relaunch of Corus’ scripted programming schedule in winter and spring represents an “exciting opportunity” for its advertising partners, as the return of audience favorites is expected to result in strong viewership.
Corus reported a profit of 32.7 million in the first quarter, up from 31.4 million a year earlier, while its revenue fell 14%. Earnings per share for the quarter were 16 cents, unchanged from a year earlier.
Revenues totaled $369.9 million during the quarter, compared to $431.2 million a year earlier. The decline came as television revenues stood at 342.4 million, down from 401.5 million a year ago, while radio revenues stood at 27.5 million, down from 29 .7 million during the corresponding period of the previous year.
On an adjusted basis, Corus said it earned 20 cents per share, up from adjusted earnings of 17 cents per share a year earlier.
Cost reduction measures
The results were better than expected “in an unusual strike-affected quarter, primarily due to lower programming costs and savings,” said RBC Capital Markets analyst Drew McReynolds.
“While visibility remains limited on the extent of the recovery in the TV sector, we view the results as modestly positive for stocks at current levels,” he said in a note.
The company took several cost-cutting measures last year, including the decision to cease production of AND Canada. She also closed the Global News special series, The New Reality.
Last fall, Mr. Murphy said Corus cut 15 percent of its workforce throughout the year.
Television personnel costs for the most recent quarter fell 5%, primarily due to those layoffs, the company said Friday.
Asked if Corus was done with cost cutting or if more cuts could be expected in the future, Mr. Murphy said the company still has work to do.
“We’re striving to continue the momentum we’ve shown so far, so that will continue throughout the year,” he said.
Corus operates in Quebec the French-language specialty television brands Historia, Séries Plus, Télétoon and La Chaîne Disney.
An environment that “remains uncertain”
Following the resolution of writers’ and actors’ strikes in the United States, Corus expects the return of new scripted shows to accelerate advertiser spending. But Mr Murphy warned that the macroeconomic environment “remains uncertain”.
He also reiterated Corus’s long-term demands for regulatory relief from the Canadian Radio-television and Telecommunications Commission (CRTC), noting that it was still awaiting some “referrals.”
Corus asked the CRTC last fall to “urgently” modify certain conditions applicable to its English-language television stations and optional services.
This included a plea to reduce the company’s requirement to spend a share of its revenue on programs of national interest for its English-language stations from 8.5% to 5%. The CRTC said it was in favor of the modification, but wanted to first hold a consultation.
“As I have said before, our regulatory environment has not kept pace and is now holding us back. Although we have seen encouraging progress over the past 12 months after years of inaction, there is still a long way to go,” Mr Murphy said.
“We will do our part to build a better future. We call on Ottawa to do the same by quickly updating decades-old broadcasting rules. It is high time to establish a fair and equitable regulatory framework in Canada,” he added.