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THE
absence of revenues from political ads notwithstanding,
listed multimedia conglomerate, ABS-CBN Broadcasting
Corp. (ABS-CBN), said its net income from January to May
this year grew 13 percent. Recurring profit, which
excludes one-time gains or losses, rose to P598 million
from P520 million.
At the
sidelines of the company’s annual stockholders’ meeting
Thursday, chairman and chief executive Eugenio Lopez III
said stable ratings and the strong performance of its
global business, through The Filipino Channel (TFC),
drove the growth.
Gross
revenues for the five-month period amounted to P8.2
billion, of which P5 billion came from airtime revenues
while P3.2 billion were direct sales, again driven by
ABS-CBN Global.
For the
full year, Lopez expects net income to reach over P1
billion, especially with cable TV firm, Central CATV,
operator of SkyCable, integrated into the group. The
company is expected to contribute heftily to the
company’s consolidated financial operations starting in
the third quarter, or once its debt-restructing program
is completed. ABS-CBN will be owning around 80 percent
of SkyCable after the debt program.
The
Lopez-owned conglomerate ended 2007 with a net profit of
P1.3 billion.
Lopez,
however, is cognizant of the impact of the current
economic slowdown. The company has observed that
revenues from television and radio advertisements have
already slowed because inflation discouraged companies
to spend on promotions.
Advertising revenue is “flattish” and “there’s a
softening in June,” Lopez said.
Rising
oil and rice prices are fueling inflation and damping
consumer spending on goods and services. Inflation
accelerated to 9.6 percent in May, the fastest pace in
nine years. It may rise to 11 percent in the third
quarter, according to the Bangko Sentral ng Pilipinas.
“It
depends if the economy falls into deep recession. We are
hoping it would be shallow. Anyway the remittances
continue to grow so we are hoping consumption will not
drop significantly. If that’s the case, we are
positioned to have a good year,” he said.
For her
part, Vivian Tin, chief for research, business analysis,
corporate planning and investor relations, said the lack
of political ads this year is not affecting the
company’s overall performance.
“The ad
volume is still up. I think that’s because we have a
good relationship with our advertisers as we offer them
creative ways to allow their brands to integrate into
our content. That has kept our ad revenues very robust,”
she explained.
Meanwhile, president and chief operating officer Maria
Rosario “Charo” Santos-Concio said the company will
continue to implement cost-control measures to achieve
savings.
“We are
putting a cap on our production costs. We only want to
see money going in and not going out,” she said.
She said
from a 14-percent growth in 2007, the increase in
production cost is now down to a low single-digit.
The
network continues to reduce production costs, cap talent
fees and rationalize expenses as it enters into more
locally-produced shows that use format rights, or
licenses of foreign titles such as Betty La Fea
and My Girl, Concio added.
Early
last April, ABS-CBN announced plans to increase its
advertising card rates by 15 percent.
The
company’s first-quarter performance was also strong,
said company executives. For the period January to
February this year, ABS-CBN grew in terms of minutes and
the number of advertisements. This trend is expected to
continue given the new quality shows lined up this year.
Lopez
also said says the network is ready to shift to digital
television.
“It’s
something we’ve been working on for two years, we’re
just waiting for the guidelines from the National
Telecommunications Commission.”
The
multimedia conglomerate’s shares opened at P18.75 in
yesterday’s trading at the Philippine Stock Exchange and
close at P19.50.
ABS-CBN
Broadcasting Corp. recently increased its stake in
SkyCable Vision Corp. to 80 percent after buying out the
family of businessman Martin Lorenzo in Pilipino Cable
Corp. for P900 million. |
