GMA Network posts 23% profit hike in H1

Broadcast firm GMA Network Inc. reported a 23 percent growth in consolidated net profit for the first half of the year to P1.126 billion as higher viewership ratings and growing international operations lifted revenues.

In a briefing yesterday, GMA Network said consolidated revenues rose seven percent to P5.695 billion due to higher airtime revenues and subscription income from Pinoy TV, its international channel.

GMA officials also noted that the broadcast firm registered more than P1 billion in revenues in May, the third time the company surpassed the P1-billion mark in monthly gross revenues this year.

Both Channel 7 and QTV 11 experienced growth in gross revenues, with QTV posting a solid 36 percent increase.

GMA chairman Felipe L. Gozon said the network’s ratings in Mega Manila averaged 17.1 percent against its main rival ABS-CBN Broadcasting Corp.’s 14.5 percent, noting that 19 out of the top 30 overall TV programs in the first half, 26 out of the 30 daytime programs and 17 out of the 30 primetime programs came from its flagship Channel 7.

Gozon said political advertisements related to the May national elctions, as well as the increase in subscriber count of GMA’s international operations also boosted the financials of the network.

GMA’s Pinoy TV and syndication contributed P207 million in revenues, 61 percent higher than the previous level.

Operating expenses, on the other hand, climbed three percent to P2.624 billion on higher production costs and talent fees, which make up 44 percent of total cash expenses. The change in primetime program mix and the staging of its election coverage translated into higher production costs.

With the increase in revenues outpacing the surge in expenses, earnings before interest, taxes, depreciation and amortization (EBITDA) stood at P2.205 billion or an increase of 17 percent from the year-ago level.

Gozon said the company is on track to meeting its earnings target for the year, which is expected to exceed last year’s P1.96 billion.

“We will try to top our financial performance last year.  We have been growing by at least 20 percent annually,” he said.

Gozon said the growth will come from its high-rating programs and the launch of game shows and reality TV shows.

GMA executive vice-president and chief operating officer Gilberto Duavit Jr. added the network will spend P673 million in the second half of the year after spending P227 million in the first semester.

Of the P673 million, P100 million will be spent for the network’s plan to go into digital TV while the balance will go to regional expansion as part of efforts to gain supremacy in other parts of the country.

GMA is allotting a total of P200 million for its planned venture into digital TV after securing a permit from the National Telecommunications Commission.

The network will build three stations in Davao, Iloilo and Dagupan to improve its signal and program distribution capabilities.  It is also putting up new transmitter facilities in Cagayan de Oro, Gen. Santos City, Batangas and Legaspi City. 

GMA is also building two state-of-the art studios within its compound in Quezon City to house modern studio equipment and facilities.