NZME profit falls by a third to $23m, reports 'soft start' to new financial year

Wednesday, 22 February 2023

NZME has struck a deal with Google, but could still benefit from a government law change.

The net profit of publisher and radio business NZME fell by a third to just under $23 million in the year to the end of December, though its operating profit edged up 4%.

The company, which owns the New Zealand Herald and about half the country’s commercial radio stations, reported revenues that were virtually unchanged at just under $366m.

The coming year is expected to be a tough one for media businesses due to expectations of a recession, which typically impacts advertising revenues.

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Rival radio business MediaWorks proposed laying off about 50 staff and axing another 40 vacant positions in January in a bid to cut costs ahead of the expected downturn.

However, the Government has moved to provide assistance to the sector by announcing it will change the law to, in effect, force Google and Meta to more widely fund the media.

Broadcasting Minister Willie Jackson has said he expects the law change will provide a funding stream to the media worth between $30m and $50m a year.

NZME said it had experienced a “soft start” to 2023, in part because of the real estate market being subdued, but said March was “tracking to deliver growth over 2022”.

It said there was “uncertainty across the economy and the market” and it would update shareholders at its annual meeting in April.