ABS-CBN income plunges 34% to P1.4B

Broadcast giant ABS-CBN Broadcasting Corp. posted a 34-percent drop in net income last year as operating expenses and financing charges increased by a faster rate than its revenue stream, the company reported to the Securities and Exchange Commission.

At the end of the 2001, ABS-CBN earned P1.484 billion, down from P2.261 billion in 2000.

Although the Lopez-owned anchor firm of the Benpres Group of Companies registered nearly a 13-percent growth in revenues mainly from airtime sales, contributions from its international subsidiaries and additional revenue from a new unit, cable channel producer Creative Programs Inc., its operating expenses went up by 24 percent year-on-year.

Consolidated revenues rose to P10.51 billion, on the back of a five-percent increase in airtime sales. However, operating expenses soared 24 percent to P7.561 billion, mainly due to higher production and depreciation costs and other subsidiary related expenses.

With the exception of flagship VHF station Channel 2, ABS-CBN controls several other media companies such as UHF channel Studio 23; cable channel ABS-CBN News Channel (ANC); online news provider ABS-CBN Online; radio stations DZMM (AM) and DWRR (FM); film outfit Star Cinema; recording studio Star Records and cable firm Sky Vision.

Based on its EBITDA (earnings before interest, taxes, depreciation and amortization), ABS-CBN still managed to post a four-percent growth at P4.585 billion but with the higher expenditures, consolidated income from operations dropped almost nine percent to P2.952 billion.

The company said that despite the sluggish business environment and its weaker earnings level, its media units remain at the top of the ratings with Channel 2 cornering an average audience share and ratings share of 45 percent and 19 percent, respectively – more than all of its free-to-air competitors combined. The VHF station alone contributes 90 percent of total airtime revenues to the ABS-CBN group.