Despite weak market, GMA Network posts higher Q3 revenues

Despite a relatively weaker market in the third quarter year-on-year, GMA Network Inc. posted a 2-percent increase in consolidated gross revenues, to P3.384 billion from P3.311 billion. GMA Network’s consolidated top line recorded a 15-percent increase to P10.109 billion minus the impact of 2010’s political advertisements worth P2.054 billion in 2010, the broadcast giant said in a statement. “In fact, the industry’s top 30 advertisers grew their advertising accounts with the company by 36 percent or over one-third from last year for the period of January to September," the company said. GMA Network’s airtime revenues from television and radio contributed bulk of the revenues worth P9.253 billion, 16 percent higher from 2010’s top line composed of regular advertising load. Better performance is also seen across the network’s different units. In terms of regular advertising revenues, television station Channel 7 performed better by 19 percent or P1.376 billion to P8.665 billion. GMA Network’s radio arm meanwhile posted a 7-percent growth in its recurring ad revenues to P306.7 million. GMA Regional TV increased its revenues from recurring national revenues, and local advertising by almost half to P117.7 million. GMA International also posted revenues growth to P718.9 million in the nine-month period owing to the appreciation of the peso against the dollar. Revenues from international operations improved by 6 percent year-on-year in dollar terms, the network said. "I am positive that the company has a better outlook going forward. GMA delivered fairly good business performance amid a non-election year," GMA Network chair and CEO Felipe Gozon said. Operating expenses For period, operating expenses (opex) amounted to P6.530 billion, up by 6 percent from P6.181 billion. A chunk of the company's opex was devoted to the continuing pursuit to deliver superior programming with the airing of the pioneering epicserye on Philippine television, the top-rating mega production “Amaya." Part of the amount backed International subscriber generation efforts that hooked around two million and one million global viewers for flagship international channel GMA Pinoy TV (GPTV) and lifestyle channel GMA Life TV (GLTV), respectively. Both channels continue to penetrate new markets in key Filipino hubs abroad via a number of channel carriers, including FetchTV (Australia), Hawaiian Telecom (Hawaii), Brighthouse (Central Florida), Comcast (New Jersey, Pennsylvania, Delaware, Michigan, and Seattle), and Time Warner (North and South Carolina, Upstate New York, and Massachusetts). GPTV also launched in Papua New Guinea via Tolec Electronics and in Sacramento via SureWest Broadband, while GLTV is now seen in Houston via Comcast. Meanwhile, the international edition of the Philippines' No. 1 news channel GMA News TV (GNTV) can now be seen via FetchTV, GTA TeleGuam, IPS Japan, and UBI World TV Australia and New Zealand. GMA International also initiated the launch of flagship radio stations DZBB (AM band) and DWLS (FM band) in Fetch TV, Hawaiian Telecom, and Time Warner North and South Carolina and North East Region during the third quarter. The Network, through its syndication and acquisition arm GMA Worldwide Inc. (GWI), generated $377,000 through the sale of locally produced films/programs in Hawaii, China, Taiwan, Tanzania, Malaysia, Brunei, and Kenya. In the nine-month period, GWI hit $781,000, or 85 percent of its total sales target this 2011. Likewise, the Network continues to allot multi-million pesos worth of investments to fortify its equipment and infrastructure in key Philippine regions. Its signal, which arguably has the widest reach among the country's free-to-air channels, can cover approximately 95.7 percent of national urban television households. GMA's originating stations in Dagupan, Cebu, Iloilo, and Davao, as well as its satellite stations in Naga, Bacolod, Cagayan de Oro, and General Santos, contribute positively to the company's top line. This is due to RTV's high rating local programs, its strong partnerships with local and national advertisers, and an aggressive promotional blitz, which further grew the network's viewership nationwide and established its leadership in National Urban Television Audience Measurement (NUTAM) ratings. GMANews.TV also No. 1 Online, the Network has successfully established GMA News Online (www.gmanews.tv) as the number one local news website visited by Internet users in the Philippines. This is according to Effective Measure data, the Australian company recently named by leading Philippine online publishers as the official third-party audience measurement provider. As part of the network's corporate strategy to diversify its revenue-generation streams, GMA New Media Inc. (NMI), the network's digital arm, sets the incorporation of Gamespan in its online operations. The launch of this online gaming in the fourth quarter of 2011 is a joint venture with Manila Jockey Club Inc. In line with its diversification strategy, NMI recently spun off one of its production units to form "Digify," a technocreative lab that seeks to complement the brand-building capabilities of traditional agencies and add value to their business. The recently formed unit will provide end-to-end solutions for standalone and integrated digital campaigns. NMI's Technocreative Unit, through years of exposure in both traditional and emerging media, has developed an expertise in digital branding, digital communications, multimedia content production, and convergent end-to-end media solutions. GMA's official web portal, www.gmanetwork.com, will soon be launched in the remaining weeks of 2011. The portal will allow users to get quick and easy access to all network properties and subsidiaries, such as Entertainment, News, International, Kapuso Foundation, Records, Film, Radio, Artist Center, and Investor Relations. Owing to the aggressive expansion projects, the company ended the first nine months with earnings before interests, taxes, depreciation, and amortization (EBITDA) of P2.717 billion, and net income after taxes of P1.580 billion. TV ratings In television, the broadcast giant reinforced its leadership in nationwide ratings this partial November, according to data from the industry's most widely trusted ratings service provider Nielsen TV Audience Measurement. In fact, GMA was the only television station that showed a steady increase in nationwide audience share from September to partial November. In contrast, competitors ABS-CBN's and TV5's audience shares were on the downtrend during the period. Based on partial November data (November 1 to 7 based on overnight readings) nationwide, GMA posted an average of 36.8 total day (6 a.m.-12 midnight) household audience share points, or an impressive 8.5-point lead over ABS-CBN's 28.3; and a whopping 20.9-point margin over TV5's 15.9 points. Using the assumption that there are five viewers per household, GMA's lead would mean that it had about 1.6 million more viewers from all over the country than ABS-CBN, and almost four million viewers more than TV5 in partial November. GMA's strong win nationwide was most pronounced in the afternoon block, where it posted a double-digit advantage over its competitors this partial November. GMA likewise posted double-digit advantage in the morning block for the said period. Similarly, in the viewer-rich areas of Urban Luzon (which comprises 77 percent of total television households nationwide) and Mega Manila (which comprises 58 percent of total television households nationwide), GMA registered impressive ratings performance during daytime to primetime in partial November. In Urban Luzon, GMA finished the said month with 40.6 share points, dominating ABS-CBN's 24 points and TV5's 16.6 points. GMA's lead over ABS-CBN translates to almost 2.5 million more viewers. Over TV5, GMA had about 3.6 million more viewers. In Mega Manila, GMA posted its highest margins in total day household audience share points with 41.3 as against ABS-CBN's 22.4 points and TV5's 17.5. In this Kapuso bailiwick, GMA had almost 2.2 million more viewers than ABS-CBN, and over 2.7 million more viewers than TV5. The Nielsen TV Audience Measurement used by GMA is also used by 21 companies including two other local networks, namely, TV5 and Solar Entertainment, Faulkner Media, CBN Asia, 13 advertising agencies, and three regional clients. On the other hand, ABS-CBN is the only local major TV network reportedly subscribing to Kantar Media, formerly known as TNS. In Mega Manila alone, the Nielsen TV Audience Measurement has a sample size of 800 homes as compared to Kantar Media's 770 homes. Nationwide, Nielsen has a total sample size of 2,005 homes compared to the 1,370 used by Kantar Media. — OMG/VS, GMA News