Aussie media titan soldiers on during brutal ad drought
Kaaren Morrissey and Will Nicholas |
One of Australia’s largest media companies hopes to turn data gleaned from millions of users into a lucrative income stream after fleeing advertisers led to a worse-than-expected year.
Southern Cross Media Group, the owner of the Seven Network, Triple M, the West Australian newspaper and others, saved big in the year to June 30 by shedding hundreds of workers but undershot its own revenue expectations.
“Declines in the advertising market took about $125 million out of the top line,” the group’s chief financial officer Scott Butterworth told an earnings briefing on Tuesday.
TV advertising was almost 10 per cent lower for the media conglomerate than in the previous year, while radio advertising in cities declined 6.6 per cent.
The drops dragged the conglomerate’s revenue down by 4.5 per cent compared to 12 months prior.
Southern Cross’s full-year, bottom-line net loss was $13.1 million, a huge swing from the $9.2 million profit delivered in the 2024/25 financial year ahead of its January merger with Seven West Media.
This was despite the media empire putting the torch to 250 of its mid-, back-office and corporate staff in June, as part of a cost-cutting strategy designed to save $150 million a year.
“Less middle management and corporate overhead, using group-wide scale in procurement to remove duplication and redesigning the work itself through process change, automation and the like,” Mr Butterworth said.
“Roughly eight per cent of the workforce left the business during financial year 2026 and we are already making headway with important non-labour savings in areas such as content and corporate costs.”
However, it was not all bad news with group underlying earnings – before interest, tax and depreciation – coming in slightly above guidance, at $191 million.
Southern Cross did not rule out scouring every nook and cranny for more revenue by “looking at middle management” again and better monetising its vast, 17 million entry-strong troves of user data.
“We’ve actually got a job to do just to capture more of the opportunity so far on the advertising front,” chief executive Rowan Lund told analysts.
“With the size of the audiences that we have and the first-party data that we possess, it’s a unique position to look at other revenue sources.”
But the group’s TV audience share swelling to 42.1 per cent – a record for a non-Olympics year – helped contain losses from that part of the business even as ad revenue plummeted.
Hundreds of thousands more people signed up for 7plus, the company’s on-demand streaming service, tuned into its radio stations and visited its news websites, Southern Cross reported.
“We connect Australians with what matters to them … we create moments that capture maximum attention and rituals that keep audiences coming back,” Mr Lund said.
The chief executive told investors the group would do everything it could to win the trust of its investors.
“Trust comes from doing what you say you’ll do and consistently delivering,” Mr Lund said.
“We intend to earn your trust this year.”
Southern Cross shares were trading at 53.5 cents in morning trading, down 1.84 per cent from Monday and down about 32 per cent since the start of 2026.
Southern Cross did not pay a final dividend for the year.
AAP