GMA Network posts P2.37 billion net profit in 2008

MANILA, Philippines - Publicly listed broadcast firm GMA Network posted a net income of P2.37 billion last year, three percent higher than the P2.31 billion profit in 2007,” the company said in a statement.

It said consolidated gross revenues went up four percent to P12.5 billion, as airtime revenues from television and radio rose three percent despite the lack of political ads which amounted to more than P500 million in 2007. Meanwhile, subscription and other sources grew 22 percent.

The biggest increase in revenues was posted by Channel 11 (QTV) at 16 percent, followed by radio at four percent and flagship Channel 7 at two percent. The international business posted 38 percent more revenues while the subsidiaries posted four percent less.

Channel 7 accounted for 87.4 percent of revenues, followed by international with 4.7 percent, QTV with 3.2 percent radio with 2.6 percent, and subsidiaries with two percent.

Meanwhile, the company’s board of directors approved yesterday the grant of a cash dividend of 35 centavos per share, amounting to about 70 percent of last year’s net income. Record date is April 15 and payment date is on May 4. This year’s dividend is 40 percent more than that declared in the previous year.

GMA chairman, president and CEO Felipe Gozon said the global crisis has not affected the company that much. “There were no cancellation among our subscribers abroad,” he emphasized.

He said he sees an increase in both revenues and bottom line this year, even as he revealed that advertising spend during the first quarter of 2008 was “not that bad,” with advertising loads increasing.

Gozon, however, emphasized that the first quarter of this year is not a good indication of this year’s performance since January and February are traditionally lean months, coupled with the ill effects of the fourth quarter of 2008 that spilled over. “However, beginning March, we have seen an uptrend in the take-up of our programs from the advertisers,” he said.

Revenues from international operations and other sources increased 22 percent. As of end-2008, GMA Pinoy TV had about 207,000 subscribers while GMA Life TV had about 45,000 subscribers worldwide.

Company officials also reported that total operating cost grew four percent last year. Despite the introduction of more in-house game shows, production cost reached P3.98 billion due to the corresponding reduction in programs rights acquisition.

Capital expenditure this year is estimated at P600 million, including carry-over capex from last year. In 2008, GMA had an P800-million capex.

In terms of advertising minutes, GMA said it grew 10.3 percent or an increase of 9,628 minutes in competitive loading.

The company also said it continues to undertake facilities and signal improvement projects in the regions in its drive to gain supremacy in other parts of the country, particularly in the South.

GMA took initiatives to strengthen signal coverage through upgrades and relocations of transmitters in Occidental Mindoro, Catanduanes, Capiz, Zamboanga del Norte, Isabela, Leyte, and Bohol. It also installed new transmitters in Mt. Amuyao and Mt. Province.

Its studio complex in its originating stations in Dagupan and Davao are now fully operational. GMA also completed its signal upgrade projects for TV-7 Naga, Gen. Santos, TV-7 Cebu, among others.