Australia’s Nine Network saw its share price fall almost 20% after the broadcaster issued a profit warning to the market.
Nine Entertainment Co., which operates Nine, revealed it expected to post earnings before interest, depreciation and amortisation of between A$285 million and A$290 million for the year ended June 30, 2015. This is down significantly on the A$311 million guidance offered at the channel’s AGM in November.
“This reduction in earnings outlook reflects a softer than anticipated free-to-air advertising market in the second half which is now expected to be in low single digit decline, driven by particularly soft conditions in May and June,” a statement to the Australian Stock Exchange read.
The warning resulted in share plunging 20% in the first 30 minutes of trading, though this had recovered to a 16.1% fall by close.
Nine expects to complete the sale of its Nine Live business on July 31, and noted in its profit warning that a programme on share buybacks remains active.
Elsewhere, Nine has decided against renewing its expensive studio output deal with Warner Bros., a move that raised eyebrows at the LA Screenings last month.
Nine’s SVOD platform, Stan, has performed well since launch and in February passed the 100,000 subscribers mark.