GMA Network’s profits reach P1-B in H1, down 4%

MANILA, Philippines – The second biggest media group, GMA Network, realized a P1.014 billion profit in the first semester, lower than the P1.055 billion it reported in the same period a year ago.

This represents a 4% drop, which is slower than rival network ABS-CBN Corp’s 45% slump the same January-to-June period.

Soft growth

The revenues of GMA Network, which operates GMA-7, grew by a feeble 1% to P6.79 billion, tracking the industry’s soft performance over the past years.  

Revenues from core channel GMA-7 was steady, while news channel GMA News TV’s grew 15%, radio 7% and regional TV 8%.

Subscription and licensing revenues of GMA International, on the other hand, grew 2% in dollar terms but slid 1% in peso terms due to a stronger local currency against the greenback.

“We saw a vast improvement in GMA’s financial performance during the first half of 2012. The company was able to recover from last year’s financial hurdle at a much faster rate against the backdrop of the foreign market’s recovery,” GMA chairman Felipe Gozon said in a press briefing on Tuesday, August 14.

“Indicators for economic growth are becoming more apparent in Asia and the Philippines particularly in the domestic trade market,” he added.

GMA’s first-half operating expenses, which grew 1% to P4.371 billion, include the program rights amortization of movie titles for the Kapuso Festival and the depreciation of the media asset management system (MAMS).
 
In a statement, GMA said it also invested heavily in its newly-launched originating stations in Ilocos and Bicol during the 6-month period.

Prospects

Gozon said they remain bullish in meeting and possibly exceeding its P2 billion full-year net income target at end-2012.

“We are on track with our projection and we will exceed because next year is election year and candidates are maximizing their exposure so we are expecting more political advocacies starting this month until end of the year,” said GMA chairman Felipe Gozon at a press briefing.
 
The 3rd quarter period is promising, said Gozon, adding that July and August numbers “have been very extraordinary.”
 
“With advertisers increasing their spending, there seems to be no reason why GMA revenues for the second half would go down. At the very least, second-half revenues would account for 55% of revenues for entire 2012,” he added. – Rappler.com