NZME (NZM) H1 2024 earnings summary

Executive summary

• Operating revenue for H1 2024 rose 3% year-over-year to $171.0 million, with digital revenue reaching $50.1 million and OneRoof achieving profitability.

• Operating EBITDA was stable at $21.4 million, and statutory net profit after tax was $1.9 million, slightly down from $2.0 million in H1 2023.

• Digital transformation remains central, with strong digital revenue growth across all divisions, especially in OneRoof, digital audio, and publishing.

• The company reaches 9 out of 10 New Zealanders monthly across platforms.

• Despite challenging market conditions, profitability was maintained and investment in digital transformation continued.

Financial highlights

• Operating revenue increased to $171.0 million, up $5.0 million year-over-year.

• Operating EBITDA was $21.4 million (H1 2023: $21.3 million); statutory NPAT was $1.9 million (H1 2023: $2.0 million).

• Cash flow from operations improved to $12.1 million (H1 2023: $8.8 million).

• Net debt at 30 June 2024 was $30.0 million, up from $18.0 million at 31 December 2023, but in line with $31.6 million at June 2023.

• Interim dividend of 3.0 cents per share declared, payable 25 September 2024.

Outlook and guidance

• EBITDA for 2024 is expected at the lower end of the $57–$61 million range, reflecting ongoing market uncertainty.

• Advertising revenue growth slowed from 4% in Q1 to 2% in Q2, with Q3 tracking at 1% year-over-year.

• $6 million in annualized cost reductions will take effect in H2 2024.

• Net debt is forecast to reduce to the lower end of the target leverage ratio by year-end.

• Largest quarter of the year ahead, with improving business sentiment.