African Media Entertainment Has Trimmed Its Interim Dividend
South Africa’s African Media Entertainment (AME), which mainly focuses on radio broadcasting, trimmed its interim dividend after the recent weakening of profit signals when turnaround efforts at recent acquisitions proved to be tougher than expected.
AME announced an interim dividend which is a 20% cut from last year’s share, following a bottom-line profit drop of 19% in the six month period that ended in September.
In comments that accompanied the results, Connie Molusi, a Nonexecutive Chairman at AME said that low business confidence resulted in highly demanding trading conditions.
He also added that the restructuring and repositioning of the recently acquired Moneyweb and Classic 1027 placed more strain on AME’s resources.
Molusi predicted that trading conditions would remain a challenge because efforts to turn around Classic 1027 and Moneyweb were taking much longer than anyone had expected.
He pointed out that Classic 1027 had been aiming to attract a younger, more culturally diverse audience; therefore, the staffing and sales structure had been re-positioned during this interim period.
Molusi maintained that he was confident that Classic 1027 would ultimately become a profitable venture.
He said that Moneyweb continued to streamline its business functions, with a focus on both radio and digital content provision.
The digital sales on Moneyweb.co.za had performed above expectation with the sales team becoming a part of the AME subsidiary United Stations.
AME’s mothership station Algoa FM gave a solid performance with its listenership remaining stable. Molusi noted that both Algoa FM’s national and direct sales were marginally up on last year.
The organisation’s segmental report showed that the radio broadcasting revenue was up by approximately 3%, but the overall operating profit had dropped.
AME, however, is still a reassuring cash spinner and its executives are confident that profit will be on the rise again as soon as it has gotten past the teething issues that come with taking over new entities.
Credit: This article originated from www.businesslive.co.za