Ten Network (TEN)

By Jason Fittler

TEN is a cyclical media company with core Free to Air TV (FTA) broadcasting (95%) and outdoor advertising operations (5%).

The businesses are leveraged to the general economy and advertising expenditure. 

Ten Networks reported a 91% dive in annual profit owing to a restructuring that involved slashing 190 jobs and writing down the value of contracts for poorly performing televised sporting events. The free-to-air television broadcaster didn't provide much outlook commentary, other than to say that it will keep costs flat this year. 

Interim Chief Executive Lachlan Murdoch said Australian businessman Harold Mitchell's prediction at a conference this week of 5%-6% growth in the advertising market in 2012 "would be fantastic." Net profit for the year to Aug. 31 fell to $14.2m from $150.0m a year earlier and included a higher-than-expected impairment charge of $85.4m. That was above Ten's guidance in August of $46.1m because of a write-down in the value of "onerous sports contracts," mostly on its ONE digital channel. 

TEN is currently looking to revamp their 2012 line up with the launch of a 3 hour breakfast show and the 7:00pm project moving to 6:30pm as well a some new US highly rated Fox series to start in 2012.

These changes certainly excited investors as the price jumped are a horrible profit announcement.

Media is a tough business as such I prefer Southern Cross over Ten.

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