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NINE Entertainment Co (ASX: NEC) reported a $203.4 million loss for FY17 thanks to $327.1 million worth of write-downs including its free-to-air TV network.
The impairments from the jewel in Nine's crown, the TV network, totalled $260 million and formed the bulkof the write-downs along with an $86 million provision to break a contract with Warner Bros.
Earnings for the year ending 30 June were $205.6 million, and the company generated $1.2 billion in revenue, down by $44.6 million or 3 per cent from FY16.
Nine says its ratings improved in 2017, helped by its Married At First Sight series, after a low in the September quarter when Seven hit its advertising revenue share with the Rio Olympics.
Nine Entertainment CEO, Hugh Marks, says the past financial year was one of strategic restructuring of the company.
"The strategic work we did over the past 18 months to reshape our content offering has delivered outstanding results that will benefit our entire business in the mid-term," says Marks.
"With a strengthening balance sheet, and significant operational momentum and leverage, Nine enters the new financial year in a much stronger position.
"The options available for us to monetize our content have never been more diverse. The media world of the future is video-based and we are right at the forefront of it in Australia."
The company's Nine Network, home to their free to air broadcast channels, saw a dip in revenue of $49.6 million, which the company says reflects a soft free to air market and the impact of the 2016 Rio Olympics.
Nine Digital, which is home to 9Now, CarAdvice, and Pedestrian TV had growth of $4.8 million, with results underpinned by long form video. Earnings in the digital sector grew by 11 per cent, reflecting the impact of Nine's increased spend in this area.
The company will pay a fully franked final dividend of 5 cents (up from 4 cents) on 19 October, bringing the full year dividend to 9.5 cents, which represents a payout of 82 per cent of the group's profit.
Looking to the future, the company says it is aware that the free to air market will continually shrink, however Nine says it is well placed considering current strong ratings compared to its competitors.
The current range of forecasts for Nine's FY18 earnings is $186 to $207 million, though the company expects to reach the top end of the range should the Federal Parliament pass the licence and spectrum fee related legislation currently before the Senate.
At the time of writing shares in Nine Entertainment are trading up 4.7 per cent to $1.56.
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