TVNZ first-half profit triples, may lift govt dividend

Television New Zealand, the state broadcaster, more than tripled its first-half profit, putting the government in line for a fat dividend at the end of the year when the board reviews its return.

Net profit was $19.2 million in the six months ended Dec. 31, compared to $4.9 million a year earlier, when the broadcaster took an impairment charge on its ill-fated TiVo joint venture, the Auckland-based company said in a statement.

That’s ahead of the annual net surplus of $14.1 million flagged in the broadcaster’s Statement of Intent, which envisaged an annual dividend payment of $12.8 million, or 70 percent of net profit. TVNZ paid out $13.5 million in 2011.

TVNZ’s earnings before interest, financial instruments, associate results/impairments and tax fell 7.7 percent to $28.7 million after programming costs rose more than revenue growth. The broadcaster lifted its television advertising by 2.3 percent to $168 million in the period, making up about 91 percent of operating revenue.

“This revenue growth and share gain is a great achievement in a market that remains hesitant and uncertain, but continues to see television advertising as the most efficient and effective means to communicate with their customers,” acting chief executive Rodney Parker said in company overview.

“There is no doubt that the company will need to maintain focus on cost management, but we are confident about the outlook for the remainder of the financial year,” he said.

Total revenue fell 2.8 percent to $199.7 million in the first half after government funding from the Ministry of Culture and Heritage, NZ On Air and Te Mangai Paho, the Maori broadcasting funding agency, dropped to $14.7 million from $20.1 million a year earlier.

Earlier this month TVNZ’s head of TV One and TV2, Jeff Latch, told Parliament’s commerce select committee the broadcaster is tightening up its internet strategy as it seeks to tap into the 83 percent of New Zealand homes viewing content online.

The board is currently looking for a replacement for Rick Ellis, who resigned as CEO to join Telstra.