Ten shares smashed after it posts $232m loss following writedown

Ten shares have dived more than 20pc after it booked a $232m half-year loss and unveiled a $214.5m writedown.

Ten, the broadcaster of the Big Bash League and MasterChef said a lift in ad market share had not been enough to offset weak conditions and higher content costs. (Photo by Paul Kane/Getty Images)

Ten Network fell to a $232.2 million half-year loss after it was hit by a $214.5m writedown despite increasing its share of the advertising market.

The company (TEN) is seeking to secure an amended or new borrowing facility with extended maturity and new size, which has the potential to be approximately $250m, Ten said in a statement.

A current $200 million loan facility, guaranteed by three shareholders, is due to expire on 23 December, 2017.

The four-year revolving cash advance facility with the Commonwealth Bank of Australia is underwritten by News Corp co-chairman Lachlan Murdoch, gaming mogul James Packer, and WIN Corporation owner Bruce Gordon.

The broadcaster of the Big Bash League and MasterChef said a 1.8 per cent metropolitan ad market share gain had not been enough to offset weak conditions in the ad market and higher content costs.

Television revenue grew by 2.1 per cent to $341.4m in the metropolitan ad market for the six months to 28 February, 2017.

Costs climbed 7.4 per cent higher to $349.4m on the back of a greater investment in domestic programming.
In a trading update, Ten expects the challenging advertising revenue market conditions to continue, and said it expects a full year loss of between $25m and $30m.

A “significant focus” on a corporate cost-cutting program and profitability is a “priority”, Ten said.

Ten’s shareholders include Foxtel, which is half-owned by News Corp, publisher of The Australian. Foxtel owns a 13.9 per cent stake in Ten.

As of 10.31am (AEST), Ten Network’s share price had declined 16.9 per cent to 37 cents, after earlier tumbling 21.3 per cent.