Australian free-to-air commercial broadcaster Ten has posted a A$226.6m (€140m/$157.8m) loss, warning that the Covid-19 pandemic could have a “material” impact on its financial position.
Ten reported revenues of A$602m in the year ending December 31, 2019, but the effect of investing in sports rights, expensive entertainment content and moving its sales team in-house saw it post a loss.
Ten told the Brisbane Times newspaper that the large costs were due to increased local investment. The broadcaster last year commenced a five-year deal with the Victorian Racing Club for the Melbourne Cup Carnival, paying A$20m per year for rights to the horseracing showpiece.
Ten said: “It was a year of investment at Ten as we bedded down our prime time schedule and set up our sales team for success. The results of that investment are evident this year: audience and audience share growth, and TV ad market share growth.”
Ten’s outgoing chief executive, Paul Anderson, noted that the company has reported fall in revenue of up to 38 per cent in 2020 due to significant reductions in advertising spend caused by the pandemic.
Ten has also seen major sporting events wiped off its schedules, including Formula 1’s Australian Grand Prix, which it holds free-to-air rights to.
Ten also holds rights to Australian motor racing series Supercars and MotoGP motor cycling, along with sublicensed Australian rugby union rights.
Anderson said: “The impact of Covid-19 on the company’s businesses – including postponement, cancellation or rescheduling of televised events for which the company has broadcast rights, and production delays in television and entertainment programming – could be material to the company’s operating results, cash flows and financial position.
“Due to the evolving and uncertain nature of this situation, we are not able to estimate the full extent of the adverse impact on the company’s operating results, cash flows, and financial position – including advertising, affiliate and content licensing revenues – particularly over the near-to-medium term.”