Nine Entertainment Co. (NEC) - FY15 result broadly in line with our estimates

Bell Potter

Stockbroker

The Nine Networks TV Revenue was down 1.1% on FY14 proforma to $1208m, EBITDA down 15% $206m, Nine Live: Revenue was up 5.6% on FY14 proforma to $238.7m, EBITDA up 3.1% to $70.1m, Nine Digital: Revenue up 33.1% on FY14 proforma to $163.4m, EBITDA up 40.4% to $21.9m, Cash flow generation remains strong with operating free cash flow at $297m in FY15 and operating free cash flow conversion at 103%. Net debt at $524m at FY15, with net leverage at 1.8x EBITDA. Nines Outlook: Market remains very short and volatile – however, July and August (est) have recorded modest growth. FY16 metro market expected to grow modestly, at best. Regional markets expected to continue to under-perform. Ratings performance has improved markedly since July. Given competitive environment and timing of major events, FY16 share likely to be marginally lower. Programming costs expected to increase 2% in FY16 (pre the benefit of FY15 Specific Item provisioning),driven by contracted higher costs associated with NRL and cricket. Non-programming costs expected to be flat. Read the full summary here: (VIEW LINK)


Bell Potter Securities is a leading Australian stockbroking, investment and financial advisory firm that provides a comprehensive offering of financial services to a diversified client base that includes individuals, institutions and corporations.

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