Shares in Nine Entertainment are bombing on the Australian market today, down 17% in early trade.
The broadcaster announced on Friday that it expected profits to suffer as the TV advertising market continues to soften.
Earnings for the financial year are now expected to be between $285 million to $290 million. This compares with previous guidance of $311 million which assumed modest growth of 2%.
“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,” Nine said.
A fully franked final dividend of about 5 cents is expected to be declared following release of the full year results in August.
Nine has sold its live events and ticketing business Nine Live to Affinity Equity Partners for $640 million. The sale puts Nine in a net cash position.
The network posted half year profit of $90.98 million, up 187%, on a 5% rise in revenue to $839.91 million.’
Nine shares were trading at $1.64 a short time ago.