Southern Cross Media Group's Strategic Focus and Trading Update at 2024 AGM
SOUTHERN CROSS MEDIA GROUP LIMITED (SXL) Share Update November 2024 Sunday 24th
Southern Cross Media Group Announces Strategic Shift and Trading Update
Southern Cross Media Group Limited (ASX: SXL) held its Annual General Meeting today, where the Chair and CEO addressed shareholders, providing a strategic update and a positive trading report for the first quarter of FY25.
Instant Summary:
- Group revenue for the first quarter of FY25 increased by 1.5% compared to the previous year.
- The company is focusing on its 'All About Audio' strategy, emphasizing digital audio growth.
- LiSTNR digital audio platform reported strong user growth and revenue performance.
- The company is in active negotiations to sell its television assets.
- Southern Cross Media aims to reduce costs and improve cash flow.
Strategic Shift to Audio
Southern Cross Media Group Limited has announced a strategic shift focusing on its audio offerings, branding itself as 'All About Audio.' This approach aims to capitalize on the company's strengths in radio and digital audio, leveraging its LiSTNR platform to reach a broad audience.
The company is actively negotiating the sale of its television assets to align with this audio-centric strategy. This move is expected to streamline operations and focus resources on growing its audio business.
Trading Update
The trading update for the first quarter of FY25 shows promising signs of recovery and growth. Total revenue for the quarter was $122.5 million, a 1.5% increase compared to the same period last year. Notably, total audio revenue saw a 4.8% increase, driven by a 48.2% growth in digital audio and a 1.1% rise in broadcast radio.
LiSTNR, the company's digital audio platform, continues to perform strongly, with over 2.1 million signed-in users and maintaining its position as the number one podcast sales network in Australia.
Cost Management and Future Outlook
Southern Cross Media Group has made significant progress in reducing its cost base, aiming to keep non-revenue-related costs below FY24 levels. The company has also completed its major digitization program, which will help lower capital expenditures in the current financial year.
The company remains optimistic about its future performance, with expectations of continued revenue growth and improved financial results as it executes its audio-focused strategy.
The strategic focus on audio and the positive trading update are likely to boost investor confidence in Southern Cross Media Group. The sale of television assets could provide additional capital to invest in the growing digital audio segment, potentially leading to further revenue growth. However, the broader market conditions and regulatory environment remain challenges that the company must navigate.
Investor Reaction:
Analysts may view the strategic shift to focus on audio as a positive move, given the growing demand for digital audio content. The company's ability to increase revenue in a challenging economic environment is likely to be well-received. However, the ongoing negotiations to sell television assets and the regulatory constraints in the media industry may be points of concern for some investors.
Conclusion:
Southern Cross Media Group's strategic focus on audio and positive trading momentum present a promising outlook for the company. Investors should monitor the progress of the television asset sale and the company's ability to execute its audio strategy effectively. Continued growth in the LiSTNR platform and cost management will be key factors in driving future performance.