NZME financial results flat; paywall speculation re-emerges as plans for registration move ahead

APN’s half-yearly results for business across both the Australian and Kiwi markets shows that net profits after tax increased from Au$24.3 million in 2014 to AU$25.1 million this year. This increased profit was driven by a AU$21.7 million lift in revenue.    

“APN has delivered a solid result in a competitive market with revenue and earnings growth in the first half,” said APN chair Peter Cosgrove in the market announcement on the results. “The Board is confident in the ability of APN’s management team to continue delivering results for advertisers and shareholders through growth and efficiency‐enhancing initiatives planned for the rest of 2015.”

NZME contributed AU$203.7 million revenue and a net profit of AU$30.7 million, but the performance of the various arms of the organisation was relatively flat when compared to the figures posted in the previous year. 

“I am pleased NZME’s trading performance for the half is in line with the forecast released in November 2014 despite a challenging Q2,” says NZME chief executive Jane Hastings.

The publishing figures show overall revenue has declined only slightly over the last year, with both advertising and circulation dropping off. However, NZME has successfully managed to almost double the contribution of the ‘other’ category (which includes events and experiential activities among others) from AU$4.5 million to $8.9 million. 

“The results of integration success are reflected in the publishing results,” says Hastings. “We are starting to see success from some of our new revenue areas with digital being the standout with 31 percent year-on-year growth.”

Radio revenue dropped from AU$61.4 million to AU$60.3, a result that was largely related to an eight percent year on year drop in agency revenue (possibly related to the diminishing role of The Radio Bureau). And ecommerce was also down, dropping from $9.7 million last year to 8.6 million this year.

According to the market announcement, the 11 percent drop in eCommerce figures were due to email deliverability issues following a change in provider—and APN says this is now being rectified with a transition to the previous platform.

The publishing segment contained one of the most interesting developments for the local market, in that APN announced that digital registrations would be implemented across the The New Zealand Herald website before the end of 2015.

“Digital registered users are key and we have some already contributing content (registration is required to comment on articles) and as mentioned yesterday we intend to expand this programme to increase our base of registered users,” says Hastings.

NZME already has approximately 2 million registered Kiwi users on the GrabOne interface, and Hastings says that this is information is proving beneficial to advertisers. 

“GrabOne has one of New Zealand’s largest customer databases delivering significant value for customers and results for our clients. Group data is an important asset and we are starting to see success from this.

The question of digital registrations again raised the question of whether or not NZME would introduce a paywall to the Herald, but Hastings said that there was no plan to introduce paid digital subscriptions in 2015. 

In this sense, the digital registration will probably involve an approach similar to that used for TVNZ OnDemand offering, which doesn’t require payment but rather provides more accurate targeting capabilities for the broadcaster and its clients.

However, according to an article on the NBR, chief executive Ciaran Davis confirmed that a paywall would be introduced and that requiring users to register was a means by which to determine interest.

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