Prime Media (ASX: PRT)

Leyland Private Asset Management

Trusted and Confidential Asset Management Advisors

Prime Media Group Limited (PRT) is a regional Australian television broadcasting and online media company. A recent market update highlighted the issues facing regional advertising. The CEO announced a 6.9% decline in advertising revenue compared with the same period last year. Revenue was expected to be flat to slightly lower, however, the key to maintaining profit is via a cost reduction program. This was not mentioned in the update and in the 2014/2015 financial year prfoit actually rose 5.2% despite falling ad revenue. Since the elevation of Mr Turnbull to PM, the debate around the abolition of the media-reach-rules (Metro stations can only broadcast to 75% of the market) has been re-ignited. If abolished, television networks, radio stations and newspapers will compete on equal footing with un-regulated digital entrants to the marketplace such as Google and Netflix. In the near-term the perceived headwinds will continue to weigh on confidence, however, in the longer-term PRT will trade on fundaments once the market becomes comfortable with earnings resilience. In the meantime, PRT pays a grossed up 17% yield. Newsletter: (VIEW LINK)


Leyland Private Asset Management
Trusted and Confidential Asset Management Advisors

Founded in 2003, Leyland Private Asset Management is an independently owned firm specialising in Australian Stock Market and Fixed Interest Investments for individuals, companies, self-managed super funds, institutions and family offices.

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