GMA Network net income up 24% in first half

CEBU, Philippines - Broadcast industry leader GMA Network sustained its strong financial performance for the first semester of 2010 even after the revenue windfall from political advertisements that ended in early May. The Company's bottomline for the covered period grew by 24 percent to P1.689 billion from last year's P1.361 billion.

Consolidated revenues increased by 19 percent to P7.565 billion from P6.335 billion record made during the same period in 2009. In nominal terms, the increase of P1.230 billion in revenues for the six-month period almost equaled the P1.274 billion improvement recorded during the full year 2009.

All business units made positive revenue contributions for the said period. Parent company Channel 7 booked an 18 percent jump in revenues to P6.414 billion in the first half; Q Channel 11 recorded a 17 percent revenue hike to P251 million; while GMA International increased revenue contributions by 11 percent to P462 million. Radio recorded the highest revenue increase of 111 percent to P337 million.

Meanwhile, operating expenses (OPEX) amounting to P4.133 billion also grew by 18 percent on a year-on-year basis. The hike in OPEX was mainly driven by higher production costs of primetime and weekend variety programs, addition of Network-produced programs that replaced canned materials in the late afternoon grid, and the election coverage costs.

Total assets grew by eight percent to P13.309 billion due to the P1.649 billion increase in cash driven mainly by political advertisements. Total liabilities remained at par with previous year at P2.927 billion. The Company continues to boast of a debt-free status by end of the second quarter.

GMA Network chairman, president, and CEO Atty. Felipe L. Gozon said that the Company keeps a confident posture in the broadcast industry amidst competition and is on track of reaching, and even surpassing its 2010 bottomline targets. "Coming from a very good first semester, I am confident that GMA can still deliver strong financial and ratings performance in the second half," Gozon said.

The Network maintains a strong presence overseas through its international channels, namely, GMA Pinoy TV (GPTV) and GMA Life TV (GLTV). GMA International recently launched both channels in Brighthouse Florida and En-Touch Texas . GLTV, meanwhile, made a debut in Comcast Central California and Hong Kong through PCCW this May.

GPTV is slated to roll out in Comcast Beltway Region ( Washington DC and Northern Virginia ) in September, while GLTV will launch in Comcast Houston in October. To date, both channels have penetrated more markets in the US, Canada , Europe, Middle East, North Africa, Australia, New Zealand, Japan, Guam , Papua New Guinea, Singapore, Hong Kong, and many other territories.

By the end of June 2010, GPTV registered a subscriber count of 256,000, up by 18 percent from the same period in 2009. Of the said number, 122,000 are also subscribers of GLTV, up nine percent year-on-year. The viewer counts are estimated at 1. 6 million and 965,000 for GPTV and GLTV, respectively.

On the other hand, GMA Network's distribution and acquisition subsidiary, GMA Worldwide, Inc. (GWI), closed contracts amounting to US$280,000 for the entire year, of which, US$151,000 worth of sales were realized for the first six months of 2010 through syndication of locally produced programs to neighboring countries and as far as Africa, Alaska, the Middle East, and North America. June saw the entry of the Network's Filipino version of Marimar into China. It will air in Mandarin through China's national television station to over one billion viewers.

Locally, GMA Network continues to strengthen its presence in key provinces nationwide. During the period, GMA Engineering completed the commissioning of TV relay station upgrades in San Jose City (Occidental Mindoro), Dipolog (Zamboanga del Norte), Ozamiz City (Misamis Occidental), Tacloban ( Leyte ), and Kalibo (Aklan). The group continues signal and facility upgrade projects in Virac (Cantanduanes), Ormoc City (Leyte), Tagbilaran (Bohol), Santiago City (Isabela), Zamboanga City, Jalajala (Rizal), and Mt. Caniao, Bantay (Ilocos Sur).