They need new leadership immediately. Warburton isnât the magic bullet to solve all the woes Worner started. Surely Kerry Stokes canât stand this no more?
He was an abject failure at Ten.
Considering Warburton became CEO last August, it would be too early to fire him now. However, itâll be a different story at the end of the year if Sevenâs ratings and financial woes havenât improved (or declined even further) by then
Just thinking out loud - I canât quite understand why Seven persevere with their existing lineup of MKR and House Rules - these are the two key wind drags on the network.
Why axe a program like Sunday Night when the news division is the networkâs best performing? Would you not work to strengthen it? (eg: reintroduction of a nightly current affairs program)
Up to this year, MKR was still a powerhouse in the ratings and House Rules was still respectable. They fill a lot of hours across the week and attract more sponsors.
Was he? Or was he a puppet for News Corp hostile takeover, some of the stuff he did whole at Ten caused Ten all sorts of issues that they are only now starting to heal from.
News may be performing but Sunday Night was not. Not that it was to blame. It fell victim to ever-changing timeslots, often pushed well past 10pm on order to facilitate lengthy reality shows. It was too expensive to produce a show few were watching.
What about 60 Minutes? In recent years it also had ever changing timeslots to accommodate reality shows like Married at First Sight, The Voice and The Block.
Those shows rate well. Sevenâs inability to have a top rating Sunday night show have caused SNâs gradual decline.
If something like X Factor was still performing well for them then we might still see Sunday Night on air today.
What I donât get is how Nine is able to maintain a good quality news service whilst having 60 minutes whilst Seven have to âsacrificeâ their news department to accommodate Sunday Night. Why couldnât they do the same as 60 and keep them separate so that they can keep their news service at a higher quality whilst also providing decent investigations for SN?
More or less proves that Kerry Stokes needs to step in and clean out every single department at Seven and get some new talents and directors into the business.
Itâs any wonder that theyâre failing when theyâve cleaned out most of the talented staff and producers working in other departments but keep the same elephants in the room in Angus Ross and Craig McPherson. They shouldâve been given the boot first.
The problem is Warburton/Seven canât just keep cost-cutting their way out of the financial hole they find themselves in. Thereâs only so much âfatâ that can be trimmed, programs that can be axed, people who (unfortunately) be made redundant, etc before reality sets in (ie; the network is ultimately going to have to be sold) and that moment is quickly approaching for Seven
Seven West Media financial results for half year ended 28 December 2019
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Advertising market conditions challenging with metro FTA TV -7.0% in the half versus a total advertising market decline of -8.5%
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#1 metro TV revenue share, up 0.4% pts to 38.8% share in 1H20 (38.4% incld. BVOD)
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Group revenue declined 3.2% driven by weaker advertising markets
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Underlying Group EBIT of $119.7m, down 20.8% YoY
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Digital EBIT growth of 205% compared to 1H19
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Significant items of $165.6m before tax, relating to impairments and onerous contracts
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Net debt of $541.5m representing 2.4x net debt to EBITDA (including proceeds from Redwave divestment)
Seven West Media Limited (ASX:SWM) reports a statutory loss after income tax of $67.0 million on total revenue of $773.3 million. Underlying net profit after tax was $69.3 million, down 22.5 per cent on the previous year. EBITDA of $136.6 million and EBIT of $119.7 million were down 20.1 per cent and 20.8 per cent respectively versus the prior corresponding period.
Seven West Mediaâs strategy to transform the group into an agile, content led organisation continues at pace, but in the face of a difficult operating environment with challenging advertising market conditions.
Seven West Media Managing Director and Chief Executive James Warburton said:
âOver the last six months, we have executed on a number of major strategic initiatives, including the investment in our new content strategy for our primetime entertainment schedule which commences in April; a major re-organization and cost out plan delivering
$45 million of gross savings; the divestment of Redwave; and proposed sale of Pacific Magazines.â
â The ACCCâs decision on Pacific Magazines is due in April 2020. We continue to work with the ACCC to address their concerns. While management were disappointed that certain stakeholders blocked the Prime Media merger, we have secured a strategic stake of 14.9%. Working down debt remains a key priority with a number of initiatives underway.â
In Television, the Seven Network was the number one free to air network by revenue share, increasing its share 0.4% pts to 38.8% in 1H20.
7NEWS increased its leadership position as Australiaâs most watched news service in 2019, growing viewing share in every market. Sevenâs coverage of the most watched Winter and Summer sports in AFL and Cricket continues to be strong, with the AFL audience for the 2019 season increasing by 3 per cent and Test cricket up 12.5%. We are already in discussions with Cricket Australia to review the Big Bash season and product moving forward.
Sevenâs content led growth strategy will invigorate its entertainment schedule in Q4 of FY20, bringing several well established, and new and exciting franchises to prime time viewing.
Sevenâs digital offerings continue to rapidly scale, with revenue growth of 58 per cent and EBIT growth of 205 percent in 1H20 compared to the prior corresponding period. In the 2019 calendar year, BVOD consumption on 7plus grew 33 per cent. Revenue growth in the BVOD market accelerated in the July to December period, increasing 42 per cent year on year.
The West launched its paywall in the period which is tracking ahead of expectations, delivered $7 million of cost savings and completed the integration of Community News Group. Trends in Pacific Magazines remained consistent with prior periods.
The value of Seven West Ventures portfolio grew 27 per cent to $103 million year on year.
Results
The group delivered revenue of $772.4 million (excluding share of associates), down 3.2 per cent on the prior period, driven by ongoing weakness in the broader advertising market.
Excluding significant items, total Group costs (including depreciation and amortisation) for the 6 months to 28 December 2019 increased 0.9 per cent to $653.6 million, with cost savings in The West and Pacific being offset by cost growth attributable to one-off events, investment in Seven Digital, third party productions and the consolidation of 7Beyond and Community News Group.
Excluding the consolidation of 7Beyond, Sevenâs costs were broadly flat, with The West and Pacific recording cost reductions of 11.0 per cent and 9.0 per cent respectively.
Significant items of $165.5m before tax related to the impairment of the television license, onerous provisions and impairment of assets against content and other items.
Outlook and priorities
FY20 Trading update and strategic priorities:
Trading conditions have remained consistent with the first half
Subject to market conditions and improved ratings, Underlying EBIT expected to be between $165m to $175m
Expect BVOD market to grow over 30% in FY20
New cost-out program targeting a further $20m for execution in 2H20 for benefit in FY21
Closure on Pacific sale
Strategic reviews of undervalued/surplus assets following inbound enquiries Seven West Media Managing Director and Chief Executive James Warburton said:
âWe will continue to be creative and apply entrepreneurial thinking. My mandate is to
dramatically change the business which means transformative M&A opportunities are very much on the agenda.
I believe we have the team, the platform and the strategy to transform and grow this business to increase shareholder value.â
The majority of this is asset impairments (including the licences) which is non-cash
Interestingly Cricket for FY21 to 24 is now considered an onerous contract
Also in todayâs Seven West presentation, confirmation of the Redwave WA radio sale. Transaction date December 31 2019 for $28m.
SCA the buyer, as announced the same time as the failed Prime / Seven merger last year. SCA now controlling the Spirit and RED FM networks and 6EL Spirit Bunbury to be divested.
Looking at the ASX just now (2:25pm AEDT), SWMâs share price fell to a new low of 20c!! 
Thatâs not much higher than Prime Media Groupâs current share price of 15.5c.
That is as bad as the share price of Fairfax before the company announced a merger with Nine.