CRTC changes should help overcome disappointing FY, Corus says

A host of problems led Corus Entertainment Inc. to post a difficult fourth quarter and year end results, the firm’s president and CEO told an analysts’ call. “I would use the term double whammy to describe the twofold blow we’ve been dealt in fiscal 2023,” Doug Murphy said Friday. “The first blow has been the meaningful decline in advertising revenues. The second has been the significant increase in required spending on Canadian programming.” The after effects of COVID-19 still have ramifications on the advertising market. In response the company has streamlined its operations, laying off close to 15 per cent of its staff and consolidating some positions in its corporate structure. Consolidated revenues for the year were $1.5 billion with $172 million being used to pay down bank debt. Most of that money came from the sale of the Toon Boom unit, which garnered $141 million. CFO John Gossling reported that the firm has reduced its debt by $912 million over the past five years. Corus has expanded beyond its flagship Global Television Network to other platforms. It has launched a streaming service called Stack TV that features programming from its various commercial and specialty networks and a free advertiser supported television (FAST) network called Pluto TV. Murphy expects the diversification to be the wave of the future for the broadcaster. Global has been affected by the concurrent strikes in the United States by the Writers Guild of America and the Screen Actors Guild. They have halted production of most scripted television series. The WGA has settled with the large production houses and writers are now back preparing scripts for shooting. Murphy said rumours out of Hollywood suggest a SAG settlement could come by the end of November. If that’s the case, the CEO expects Global’s broadcast schedule and advertising revenues to improve by March. As part of its belt-tightening procedure, Gossling revealed that Corus will suspend its dividend for the quarter. The CRTC has stated that it is looking favourably on providing relief to the firm on its Canadian programming obligations. That delighted Murphy. “The regulator’s statement last week was the most substantive move towards regulatory change that our company has seen in years and we are encouraged by it,” he said. Gossling noted that Canadian programing expenditures (CPE) were $5 million for the fourth quarter and $11 million for the fiscal year. In order to reduce costs, two series, the entertainment show ET Canada and the news program The New Reality were recently canceled. The CFO is bullish on the future. “It is a new fiscal year and we are hopeful for improved visibility in the coming months,” he stated. Murphy said the company is supportive of the Online Streaming Act and hopes that its implementation will lead to better results for the firm down the line. –Reporting by Paul Park at ppark@thewirereport.ca and editing by Jenna Cocullo at jcocullo@thewirereport.ca

CRTC changes should help overcome disappointing FY, Corus says

Broadcast | October 31, 2023

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