Southern Cross Media Group (SCA) has reported a 1 per cent decline to revenues in the 2024 financial year, for $499.4 million, with the media business improving it's financial performance in the second half despite a 24.3 per cent decline to EBITDA across the year.

The company, which has assets across audio and television, recorded a loss in net profit after tax (NPAT) of $224.6 million, compared to profits of $19.1 million in the last financial year, and has determined not to pay a final dividend for FY24. On an underlying basis, EBITDA was down 14.3 per cent to $66.2 million and NPAT was down 49.2 per cent to $11.2 million.

Total expense were up 1.4 er cent to $433.2 million, including non-revenue-related expenses were $308.4 million, in addition to significant items (after tax) of $235.8 million. The latter included a non-cash impairment charge of $326.1 million ($228.3 million after tax) for for radio licences, as well as restructuring costs and redundancies, costs associated with the responses to ACM and ARN's acquisition proposals, and software and other project write offs.

As mentioned, the second half of the year was more upward looking, with a 1.1 per cent improvement to revenues and underlying EBITDA up 6 per cent on the corresponding period. This improvement was driven by SCA's dominance of the 25-54 audience in metro and regional radio markets, an increase in metro advertising revenue share, strong growth in digital audio revenues, and cost discipline. LiSTNR achieved underlying EBITDA profitability in the fourth quarter of FY24.

“SCA maintained dominant audience shares in our core metro and regional radio and digital audio markets during FY24. Despite challenging advertising market conditions, our improved financial performance in the second half has provided strong momentum into the new financial year. Our national leadership in the core buying demographics for men and women aged 25-54 provides our sales teams with a strong platform for continued growth into FY25," said SCA CEO John Kelly.

SCA's broadcast radio assets, which include the Listener and Triple M networks, saw revenue declines of $1.6 to $366.6 million, while EBITDA fell 10.9 per cent to $87.2 million. While SCA grew its metro radio market share to 27.2 per cent in the second half, metro revenues fell 2.7 per cent. This was partially offset by the resilience of regional radio, which lifted 0.8 per cent to $1.3 million.

Meanwhile, digital revenue jumped 42 per cent $35.0 million, with H2 FY24 up 57 per cent on H2 FY23. Since FY19, SCA has grown its digital revenue at a compound annual growth rate of 34 per cent. Non-revenue-related expenses of $308.4 million came in below guidance of $310 million.

“In the fast-growing digital audio sector, LiSTNR has reached over two million signed-in and addressable users, with around one million of these interacting with LiSTNR monthly. This is testament not only to the range of engaging content on LiSTNR but also to the excellent and personalised user experience delivered by LiSTNR," said Kelly. “The LiSTNR AdTech Hub is driving premium commercial returns for our advertisers and driving growing interest. The LiSTNR AdTech Hub enhances our advertisers’ ability to connect with relevant audiences on LiSTNR and other digital audio distribution platforms.

“With the LiSTNR AdTech Hub and centralisation of SCA’s audio operations largely complete, our capex program is continuing to slow. Capex will be around $10 million in FY25.

Continuing challenges to SCA's Television business saw revenues fall 8.7 per cent to $97 million, with national revenues down 11.5 per cent and local down 9 per cent. EBITDA decreased by 28.9 per cent, to $13.3m

Kelly confirmed the business had re-commenced a strategic review of its non-core regional television assets and was in active negotiations with several parties interested in acquiring those assets. "The sale of our regional television assets will enable us to focus on optimising our leading radio and digital audio assets, led by LiSTNR, HIT and Triple M," he said.

Year-end leverage of 1.87 times EBITDA remains well within banking covenants.

Looking ahead, the company outlined that audio revenues for Q1 FY25 are pacing ahead of Q1 FY24. SCA's reset of its operating model will deliver FY25 non-revenue-related costs below FY24 ($308.4 million).

Digital Audio momentum is continuing, and LiSTNR is expected to be cash flow positive in FY25. Improved cash conversion will deliver leverage below 1.5 times on 30 June 2025. SCA will actively progress the sale of its TV assets in the coming months and the Board expects dividends to resume within policy but towards the lower end of the target payout range (65% to 85% of underlying NPAT).

SCA also announced changes to its board, with Helen Nash to retire as director on 30 September 2024. The Board has appointed Marina Go to join SCA as an independent non-executive director on 1 October 2024, and she has agreed to chair the Board’s People & Culture Committee. She will also be a member of the Board’s Audit & Risk Committee, and will submit for election by shareholders at SCA’s AGM on 25 November 2024.

With a background in media, Marina Go has worked in executive and non-executive roles across a range of listed and private companies across a diverse range of sectors and is currently a nonexecutive director on the boards of Transurban Group, Energy Australia, Adore Beauty, Autosports Group and The Australian Institute of Company Directors.

SCA Chair, Heith Mackay-Cruise said: “Helen Nash has brought an immensely valuable mix of commercial and strategic operational acumen during her nine years on the SCA Board. Our directors and SCA’s senior executives have also valued Helen’s knowledge and leadership in supporting people and culture initiatives as previous Chair of our People & Culture Committee.

“I am delighted to welcome Marina Go to our Board. Her appointment follows an extensive search led by an external search consultant. After meeting with several outstanding candidates, we agreed that Marina has the ideal experience, skills, and personal attributes for SCA’s needs.”