Nine Entertainment flags $100m in cost cuts

Nine Entertainment says it will try to save $100m in costs over the next two years, and there will be further restructuring of the business.

Nine Entertainment has flagged a further $100m in cost cuts by the end of 2027, including restructuring staff, it said in its latest ASX announcement.

According to its half-year results, the company plans more restructuring as part of its “strategic and cultural transformation”.

Nine continues to be hampered by a weaker economy, soft advertising revenue and the impacts of losing Meta on its revenues.

Meta was previously paying Australian media companies collectively up to $100m to publish content, with the deal being scrapped in the new financial year. Following the announcement in July, Nine cut 200 staff.

Nine said it was being hampered by the impacts of losing Meta. Picture: Supplied

“As Nine continues its strategic and cultural transformation, there is expected to be further restructuring into H2 FY25 and FY26,” Nine said in its half-yearly results.

“These changes will be designed to ensure Nine’s optimal positioning into the future while also maximising the efficiency of our cost base.

“At this stage, Nine expects further cost efficiencies through to the end of FY27 of more than $100m, of which $10-20m is expected to be realised in FY25, in addition to the previous guidance of $50m in FY25.”

The transformation follows allegations late last year that bosses in Nine’s broadcast division belittled, intimidated and sexually harassed staff members.

An independent review into Nine’s workplace practices and culture made 22 recommendations in a damning report.

Based on 934 Nine-wide staff survey responses, as well as 122 face-to-face interviews and written submissions, the review included confronting testimonies about the toxic culture of the company and a cover-up by HR when complaints were made.

Cost-cutting, including lay-offs, delivered $35m worth of efficiencies for the December half, and Nine said it would exceed its previous target of $50m in cost savings for the financial year.

The company said it posted a half-year net profit of $95m as revenue grew 1 per cent to $1.41bn.

Nine said it would be looking for opportunities to cut its cost base as well as lift its revenue.

Despite a revenue uptick, the company’s earnings before interest, taxes, depreciation and amortisation (EBITDA) fell 15 per cent to $268m, with net profit after tax down to $95.1m, falling 29 per cent on this time last year.

Nine Entertainment chair Catherine West said the company ‘continued to perform well’.

The group lowered its half-year dividend to 3.5c per share from 4c for the prior December half.

Nine’s chair Catherine West flagged strong results in a tough environment.

“In a challenging market environment, we have continued to perform well operationally while simultaneously strengthening our strategic position and implementing our cultural reset,” she said.

Earnings contribution from its real estate listings business Domain – the target of a takeover bid by US group CoStar – lifted to 15 per cent, with Nine saying it remains a key part of its long-term growth strategy.

Nine acting chief executive officer Matt Stanton said Nine continued to have a unique relationship with Australian audiences.

“Operationally, we were generally pleased with the performance of our portfolio in the half. In particular, at Stan, subscriber numbers exceeded our expectations, underpinning 16 per cent growth in EBITDA, while at publishing, digital subscription revenues at our mastheads grew by 15 per cent (ex the impact of Meta and Google), with the team also doing a great job with cost efficiencies offsetting much of the impact of the Meta withdrawal.”

Originally published as Nine Entertainment flags $100m in cost cuts