The country’s largest multimedia conglomerate ABS-CBN Broadcasting Corporation posted core net income of P1.4 billion for January to September 2009, 16% higher than its net income of P1.2 billion for the same period in 2008, and exceeding its net income of P1.38 billion for the full year of 2008.
Net of PFRS 3 adjustments relating to the consolidation of Skycable amounting to P50 million, the reported net income of ABS-CBN comes to P1.35 billion, 12% more than its P1.2 billion net income for the first nine months of 2008.
Third quarter EBITDA of P1.79 billion boosted EBITDA for the nine-month period to P5.16 billion. This translates into an EBITDA margin of 28%, and is 16% or P724 million more than the EBITDA of P4.4 billion in the first nine months of 2008.
For the period January to September 2009, ABS-CBN Broadcasting Corporation generated consolidated revenues of P18.34 billion, an 11% year-on-year growth over the first nine months of 2008.
The revenue diversification of the Company continues to improve as direct sales including sales of services from Skycable grew 19% year-on-year to P7.67 billion, contributing 42% to consolidated revenues. Airtime revenues of P10.68 billion contributed 58%, as it grew 5% year-on-year. (ABS-CBN’s comparative financial results include the contributions of Skycable for three quarters of 2009 versus the 2nd and 3rd quarters of 2008.)
Direct sales from core businesses in the third quarter amounted to P1.79 billion, a 6% year-on-year growth, bringing consolidated direct sales for the January to September period to P5 billion, P305 million or 6% more than it was in the same period last year.
ABS-CBN Global continued to deliver double-digit growth as its subscription revenues managed to grow by 15% year-on-year despite economic slowdown in most of its major markets, while Star Cinema’s three film releases during the third quarter—Villa Estrella, And I Love You So, and In My Life—pulled in a combined P282 million in box office receipts.
Consolidated direct sales for the third quarter including sales of services from Skycable totalled P2.7 billion, for a 6% year-on-year growth. Skycable’s revenue contribution for the nine-month period from subscription and other service revenues amounted to P2.65 billion, an increase of P932 million or 54% from its contribution in the same period in 2008, driven by strong growth in contributions from Skycable’s prepaid cable and broadband service subscriptions.
The strong ratings and audience share performance of Channel 2 continued to sustain airtime revenues in the third quarter, along with continued strong airtime revenue growth and contribution share from ABS-CBN Global and cable channels. Airtime revenues of P3.96 billion in the third quarter raised consolidated airtime revenues for the nine-month period to P10.68 billion.
ABS-CBN maintained its national ratings and audience share leadership by spicing up its afternoon and primetime weekday programming in the third quarter with a combination of drama and comedy offerings. On
weekday afternoons, the Mexican telenovela Maria de Jesus, and the Precious Hearts Romances instalment Ang Lalaking Nagmahal sa Akin continued to cater to our core viewership, while Banana Split Daily Servings brought fresh fun and laughter to a wider audience mix. The new drama programs Katorse, Lovers in Paris, and Dahil May Isang Ikaw bolstered Channel 2’s already strong weekday primetime line-up that includes TV Patrol World, the widely followed May Bukas Pa, and the entertainment news program Showbiz News Ngayon or SNN.
Based on figures from TNS National Urban Philippines TV ratings service, ABS-CBN kept its total day ratings at the 18-points level from July to September, versus GMA’s 13-14 points. ABS-CBN’s national total-day audience shares in the third quarter stayed at the 46-47 points level, maintaining a double-digit lead over GMA7 of at
least 11 percentage points.
Primetime ratings of Channel 2 stayed at the 30-points level with a 9-10 point lead over GMA7 from July to September. Audience share of Channel 2’s primetime block continued to remain at the 50-51 percentage-points level from July to September.
According to TNS rankings in October, ABS-CBN’s primetime programs held nine of the top 10 slots, led by TV Patrol World, May Bukas Pa, Katorse, Lovers in Paris and Maalaala Mo Kaya in the top five. ABS-CBN programs held 17 of the top 20 programs in October 2009, with all primetime programs launched in the third quarter—
Katorse, Lovers in Paris, Dahil May Isang Ikaw, and Agimat: Ang Mga Alamat ni Ramon Revilla—in the top 10, and all editions of the recently launched Pinoy Big Brother Double Up breaking into the top 20 list.
Prudent operating and financial management enabled ABS-CBN to contain growth in total expenses at single-digit rates.
Overall, production costs for the first nine months of 2009 of P4.65 billion are just P175 million or 4% higher than in the comparable period last year, with the increase mainly due to an additional locally-produced afternoon soap and a late-evening entertainment news program. Cash production costs went up by only 2% or P86 million to P3.59 billion in the first nine months of 2009. Additional depreciation expenses arising from continuing investments in the upgrade of production and broadcast equipment caused non-cash production
costs to go up by 9% to P1 billion.
Cost of sales from core businesses grew by only P20 million or 2% in the third quarter to P1.1 billion, while Skycable’s cost of sales for the 3rd quarter is P317 million. Total cost of sales and services for the January to September period, including Skycable’s cost of sales of P939 million, amounted to P3.77 billion, an increase of P575 million or 18% year-on-year.
Consolidated General and Administrative Expenses (GAEX) of core businesses for the nine months to September 2009 totaled P5.6 billion for the nine-month period, for a year-on-year growth of 18%. Total GAEX of core businesses went up by P150 million or 12% in the third quarter to P1.43 billion, primarily from higher personnel expenses as a result of structural adjustments, CBA increases and non-recurring payouts. Skycable’s 3rd quarter contribution to total GAEX amounted to P527 million.
Total group spending on CAPEX and film and program rights acquisition inclusive of Skycable’s CAPEX reached a little over P2 billion, P381 million or 23% more than the spending over the same nine-month period in 2008.
Skycable’s self-funded CAPEX of P590 million over January to September period was used for the continuing conversion to digital cable signal delivery within its service areas and for its broadband network.
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