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Macquarie Media eyes revenue growth

AAP logoAAP 8/08/2016

Radio station owner Macquarie Media, formed from the Macquarie Radio and Fairfax Radio merger, says it is focused on boosting revenue after a year of cutting costs.

The owner of Sydney's 2GB, Melbourne's 3AW and Brisbane's 4BC has reported strong underlying earnings, partly due to cost cuts in the wake of last year's merger.

Macquarie Media posted an earnings before interest, tax, depreciation and amortisation (EBITDA) of $25.5 million for the 12 months to June 30, up from its guidance range of $20 million to $25 million.

This pleased investors who drove the company's share price up three cents, or 3.06 per cent, to $1.01 on Monday.

The $200 million merger in April last resulted in a number of job losses, including the axing of Sydney station 2UE's entire newsroom.

Executive chairman Russel Tate hinted that more costs cuts would happen in the 2017 financial year, however he said the primary focus now would be revenue growth.

He said the company would build on the five per cent year-on-year revenue increases it achieved in the second half of the 2016 financial year.

"We begin FY17 with a restructured sales management team and aggressive revenue growth strategies and targets, which I am confident will underpin continued strong earnings growth," he said.

He said the comparison of the 2015/16 result with the previous year would not provide a meaningful result, given the accounting treatment used for the newly merged stations' accounts.

A better comparison would be with the 2014 results of both former companies, which showed a four per cent revenue decline and a 93 per cent net profit gain, he said.

"This comparison clearly demonstrates the economic benefits of the merger," he said.

Macquarie Media's net profit of $13.3 million was sharply lower than the previous year's $44.8 million, but its profit from continuing operations more than doubled, lifting to $14.4 million from $5.71 million.

Revenue of $133.8 million was well up, due to the impact of gains from the merger.

Mr Tate will be paid $1 million salary and fees, up from $251,710 in the previous year.

Fairfax Media has a 54.5 per cent stake in the company.

MACQUARIE MEDIA'S FIRST FULL-YEAR RESULTS:

* Net profit down 70 pct on 2014/15 to $13.3m*

* Revenue up 40pct on 2014/15 to $134m*

* Final dividend two cents a share, fully franked

(*2014/15 figures comprise pre-merger results)

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