GMA Network profit up by a fifth last year

(UPDATED) Net profits of broadcast giant GMA Network grew by almost a fifth to P2.82 billion last year despite lower ad spending amid the global economic slump. The network expects to perform even better this year on the back of the recovering economy and improved efficiency, the company said in a statement on Thursday. "I am glad that the network was able to surpass its targets despite a difficult year," GMA Network Chairman, President and Chief Executive Officer Felipe L. Gozon said. "We expect 2010 to be an even better year for the company as we continue to be more cost-efficient, embark on strategic sales and marketing operations, and with the global economy starting to recover," he added. Consolidated revenues grew by a tenth to a record P13.77 billion from a year earlier, while consolidated operating expenses were kept to single-digit growth of 9 percent to P7.842 billion. Much of the operating expense was accounted for by increases in the company’s manpower alongside the payout of more benefits to employees, the media giant said. "The company benefited largely from its yearlong proactive performance to contest the global financial slowdown, and from its continued operational efficiencies," it added. Earnings before interest, taxes, depreciation and amortization (EBITDA) stood at P4.889 billion — 10 percent higher than in 2008. Meanwhile, assets went up by a tenth to P13.763 billion, while liabilities increased by 6 percent to P2.883 billion. International operations The network remained aggressive in its international operations, expanding its reach to more viewers abroad. By the end of last year, GMA Pinoy TV (GPTV) — one of the fastest-growing international channels — had 236,000 subscribers, 16 percent higher than a year earlier. Of the total, 107,000 were also subscribers of GMA Network’s second international channel, GMA Life TV (GLTV). GLTV’s subscribers more than doubled from the year-ago level. The subscriber counts were equivalent to 1.5 million and 700,000 viewers for GPTV and GLTV, respectively. "Both channels have penetrated markets in the US, Canada, Europe, the Middle East, North Africa, Australia, New Zealand, Japan, Guam, Papua New Guinea, Singapore, Hong Kong and many other territories," the company said. In 2009, revenues from its international business grew by almost half to P855 million. GMA International had a 15.9-percent share in the parent company’s bottom line. Meanwhile, GMA Network’s distribution subsidiary, GMA Worldwide, Inc., has syndicated locally produced programs to as far as Africa, the Middle East and North America. It has also distributed several GMA dramas and films to Malaysia, Singapore, Cambodia, Brunei and Vietnam. The local version of the Mexican telenovela "Marimar" is now available with English dubbing in Kenya and Uganda, it pointed out. “For 2010, we see the international segment breaking the P1-billion mark in terms of top line contribution. But we are seeing a 14- to 15-percent increase in revenues from the international segment," GMA Network Executive Vice-President and Chief Operating Officer Gilberto R. Duavit said in a briefing. Gozon, meanwhile, said he was optimistic about the network’s expansion to Europe. "[GMA] International has been one of the areas we have invested in, so we expect improvements in the [countries] we are covering in 2010. We have barely scratched the surface of Europe," he pointed out. He also said the Middle East continues to offer more opportunities. "That is the benefit of our being younger, so to speak, than [ABS-CBN’s The Filipino Channel]," Gozon said. Expansion Locally, the network continued to expand its presence in key provinces nationwide. In 2009, it completed and started operating its four new satellite stations based in Naga, Bacolod, Cagayan de Oro and General Santos. These stations are capable of independent content play-out and complement existing originating stations — GMA Channel 10 Dagupan, GMA Channel 7 Cebu, GMA Channel 6 Iloilo and GMA Channel 5 Davao. GMA likewise made its programming content geo-targeted by upgrading transmitter facilities in Santiago, (Isabela), Roxas, Dipolog, San Jose (Minodoro), Kalibo, Virac, Ormoc, Tagbilaran, Tacloban and Ozamis, and by building new TV stations in Jala-Jala (Rizal) and in Mt. Caniao, Bantay (Ilocos Sur). The company said, it had kept its lead in viewer-rich Mega Manila from January to December 2009 based on data from AGB Nielsen Philippines. From January to December 2009, GMA posted an average total day (6 a.m.–12 midnight) audience share of 40 percent, 8 percentage points higher than rival ABS-CBN’s 32 percent. For channel ratings, GMA averaged 17 percent against ABS-CBN’s 13.7 percent. "In total urban Luzon, which accounts for 77 percent of the total viewing population in urban Philippines, GMA beat ABS-CBN by 3.3 percentage points with an average audience share of 38.4 percent," the company said. Duavit said the network was planning to shift its focus to traditional dramas. "In the past, the audience has been heavy in fantasy dramas, but we see this trend dwindling," he said, adding that 55-60 percent of programs will be produced by the network. GMA 7, whose rating lead in Mega Manila over rival ABS-CBN was only 0.3 percentage point at 14.8 percent in March based on AGB Nielsen’s survey, has vowed to raise the bar. "Their programs are getting stronger, that’s why we are also doing things [to be more competitive]. This tightens the competition but it ultimately benefits the viewers," Gozon said. GMANews.TV is the company’s news Website. — N.P. Aquino and N.A. Corsino, GMANews.TV