Shares in entertainment giant Nine have surged after it posted a $140.2 million first-half post-merger profit and said streaming service Stan would soon be making money.
The company copped $43 million in costs related to December's merger with Fairfax Media, but its pro forma net profit rose one per cent, helped by a $93 million increase in Stan's carrying value and the sale of the NBN station in Newcastle.
Total pro forma revenue fell by $9.8 million, or one per cent, to $709.8 million, but broadcast costs improved by 13 per cent, or $62 million, as the company switched cricket for tennis.
Nine shares were more than nine per cent higher at $1.60 in early trade on Thursday, but had cooled to $1.54 by 1448 AEDT.
Chief executive Hugh Marks said the company's overall result was a "testimony to the new Nine" as traditional assets and digital opportunities converge
But the new conglomerate's regional publishing unit, ACM, remains in the shop window with Stuff NZ after six months marred by drought and a soft advertising market.
Mr Marks said ACM represented an opportunity for suitors to replicate the success of Nine's metro publishing transformation - where circulation and revenue had stabilised - to a regional audience.
He said Stuff NZ was a stronger digital offering.
"As I stand here today, there will be interest in both businesses," Mr Marks said.
While Australia's lacklustre property market has kept real estate investment Domain flat, TV on demand service 9NOW is booming with nearly 50 per cent of the catch-up market and a strong start to 2019 thanks to the success of Married at First Sight and the Australian Open.
Nine's broadcast division, which accounts for 54 per cent of group revenue, endured a mixed half with tennis coverage falling outside the reporting period and the absence of cricket contributing to a 11 per cent - or $73 million - revenue decline to $563.5 million.
However, the cricket factor reduced TV costs by 13 per cent, or $60 million.
Revenue from metro print subscriptions, including The Age and Sydney Morning Herald, rose one per cent to $86.4 million, while digital subscription revenue lifted 14 per cent to $27.7 million.
Print ad revenue was down one per cent to $71 million but digital ad revenue climbed 21 per cent to $32.7 million, lifting total revenue four per cent higher to $240.8 million.
Nine's statutory profit slipped 1.4 per cent to $171 million in the six months to December 31.
Mr Marks said Nine is expecting a 10 per cent lift in full-year pro forma earnings to $420 million, with Stan tracking to post its first profit in FY20.
The company has maintained its interim dividend of 5.0 cents per share, fully franked.
NINE SHARES JUMP ON POST-MERGER GROWTH
* Pro-forma net profit up 1pct to $140.2m
* Pro-forma revenue down 1pct to $709.8m
* Statutory net profit down 1.4pct to $171m
* Interim dividend unchanged at 5.0 cents per share, fully franked
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