Adshel sale, radio business lift HT&E profit

The sale of its outdoor advertising business has helped swing media and entertainment company HT&E to a net profit in 2018.

The sale of Adshel for $570m has helped swing HT&E to profit for the 2018 full year. Picture: Josh Woning.

Further divestments may be on the drawing board at media and entertainment company HT&E, which swung to a net profit in 2018.

Up for grabs could be HT&E’s outdoor advertising business Cody in Hong Kong and its 25 per cent stake in software company Soprano Design following the sale of its outdoor advertising business Adshel for $570 million last year.

Chief executive Ciaran Davis said if an offer came in for Cody, which returned to profitability for the first time since 2015, “that we think is right for shareholders, then yes, we would look to take it”.

Mr Davis said Soprano was also doing well, and it was working with its founder and majority shareholder Richard Favero on future opportunities.

“And again, if the right outcome comes, the one that we believe maximises value in that business, then yes, we would look to consider that, as well,” he said on a conference call to discuss HT&E’s 2018 financial-year results.

HT&E acquired its 25 per cent stake in Soprano, whose products are sold by mobile network operators, in 2001.

Chairman Hamish McLennan said last year was “truly transformational” for the group with the sale of Adshel to oOh!media.

The group is focused on its “valuable and cash generative radio and audio assets”.

“The company’s financial performance was in line with expectations with a strong first half in radio offset by a weaker advertising market in the last four months of the year,” Mr McLennan said.

HT&E has booked a net profit of $225.5m for the 12 months to December 31, compared with a net loss of $117.5m in 2017.

Stripping out Adshel, HT&E posted a 7 per cent jump in annual underlying earnings of $71.8m on the back of a 5 per cent rise in revenue from continuing operations to $271.8m.

ARN, which boasts radio stations such as KIIS, Pure Gold and The Edge, booked underlying earnings of $84.6m, up 1 per cent from a year earlier, with ­revenue up 3 per cent to $235.5m.

Still, ARN’s costs rose 3.3 per cent to $150.9m, due to increases in promotion and marketing to launch four new shows.