NEWS
10/22/2015 16:24 EDT | Updated 10/22/2016 01:12 EDT

Slow advertising sales leave another dent in Corus' quarterly results

TORONTO — A fickle advertising market left its mark on the financial results of Corus Entertainment (TSX:CJR.B), owner of some of Canada's most prominent specialty TV channels.

Between a pullback in overall advertiser spending and the absence of sales tied to the lucrative 2014 World Cup, the Toronto-based broadcaster said profits were weaker in the fourth quarter, falling to $17.8 million from $23.7 million in the same period of last year.

"The common themes affecting the buoyancy of the advertising marketplace remain," chief executive Doug Murphy told analysts on a conference call.

"However, as we approach calendar 2016, signs of improvement are beginning to emerge."

Corus owns a slate of specialty channels, including YTV, the W Network and OWN: The Oprah Winfrey Network.

It also runs the Telelatino channel where FIFA World Cup soccer games drew big audiences and hefty spending from advertisers in summer 2014.

Since joining the company earlier this year, Murphy and his executive team have been trying to reduce costs and pivot the broadcaster's focus to include more emphasis on digital assets, like mobile apps dedicated to accessing programming from some of its channels.

But the company has been persistently hindered by weak spending from advertisers that has deeply cut into financial results.

Revenue was down four per cent to $193.6 million from $201.6 million, affected partly by a weaker Canadian dollar.

Advertising sales were also a big drag on revenues, falling eight per cent to $78.1 million in the quarter.

Murphy said he's hopeful that "transformational" agreements with Nickelodeon and Disney's slate of kid's channels will help bolster future ad sales as it chases more family-oriented advertisers.

Corus has been introducing more of Disney's popular kids programs under a new distribution agreement that takes over some rights from the Family channel, which had aired most of the Disney series in Canada.

Overall television revenues slid three per cent to $154.3 million, affected partly by softness in subscriber fees collected for its specialty channels, which inched back one per cent to $85.4 million.

Radio operations, which include 39 stations in major markets across much of the country, saw revenues drop six per cent to $39.2 million, affected partly by slower advertising sales in Western Canada.

For the year, Corus posted a loss of $25.2 million versus a profit of $150.4 million in the prior year.

 

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David Friend, The Canadian Press