ABS-CBN incurs P114-M net loss in Q1

Lower revenues and rising costs affected the financial performance of ABS-CBN Broadcasting Corp. in the first quarter this year as it incurred a net loss of P114.27 million, compared with the P124.09 million profit in the previous year-period.

The poor performance was also attributed to the network’s failure to arrest the decline in its viewership ratings, as it continued to be beaten by its chief rival GMA Network Inc.

Airtime and other broadcasting-related revenues decreased by seven percent to P2.25 billion from P2.34 billion as mega-Manila household ratings fell to 14 percent from 16 percent a year earlier.

To prevent the continued decline in ratings and return to profitability, ABS-CBN president and chief operating officer Luis Alejandro said the network will implement a three-point recovery plan which would involve regaining the lead in primetime ratings, optimizing production costs and margins, and the review of its manpower complement.

"The road will not be easy and we do not expect to recover overnight. But we have a talented group of committed and dedicated individuals who are among the best in the business. Together we expect not only to get over this recent setback but to emerge an even stronger ABS-CBN," Alejandro said.

As of the first quarter this year, ABS-CBN had a lower market share of 34 percent in mega-Manila, from 38 percent in 2004. On the other hand, GMA Network Inc.’s market share grew to 46 percent from 42 percent last year.

ABS-CBN chief financial officer Randolph Estrellado said despite the company’s poor financial performance, the network still gets full advertising load from 7 p.m. to 9.30 p.m. daily.

He said operating costs continued to rise on the full-year impact of programming changes implemented in response to the more competitive environment.

Alejandro said the network has already launched 24 new shows and will continue producing innovative programs to meet the changing needs of the viewing public.

"You just have to give us a chance. The mere fact that we made an intent to do something about this should be a sign that we really mean business," Alejandro said.

Total revenues, consisting of gross airtime, other broadcast related revenues and net sales and services, were relatively unchanged at P3.4 billion from P3.44 billion. Of the total, P910 million came from ABS-CBN Global or an increase of 29 percent from the year-ago level.