Lower demand for radio and television advertising continue to impact Corus Entertainment’s bottom line as the company released second quarter financial results Friday morning.
Revenue fell 10% year-over-year to $270.4 million, with the company reporting $251.8 million in television revenue, down from $278.1 million compared to the same quarter a year ago. TV ad revenue fell 13% to $129.5 million. Radio revenue was also down by 14%, falling to $18.5 million, from $21.5 million in Q2 2024. The net loss attributable to shareholders totalled $55.9 million or 28 cents per diluted share for the quarter ended Feb. 28.
In addition to lower demand for linear advertising, in the television segment – which saw a segment profit decline of 62% year-over-year – the company cited lower traditional TV subscriber revenue, partially offset by modest growth in streaming subscribers; fewer episode deliveries, and higher amortization of programming rights, offset by a decrease in expenses.
There were gains in radio’s segment profit margin, which increased from four per cent in the same period in 2024 to eight per cent this year, reflecting cost savings initiatives, which were partially offset by lower ad revenue.
“Our television advertising revenue was modestly ahead of our outlook for the second quarter, building on the strength of our programming and audiences. At the same time, we recognize that the industry landscape remains challenging with limited visibility,” said John Gossling, Co-Chief Executive Officer and Chief Financial Officer, in a Corus statement. “As such, importantly, we have taken significant steps to progress our capital and debt plan, and our updated credit facility provides enhanced stability as we pursue further right-sizing initiatives and targeted growth opportunities to create a more sustainable future.”
Co-CEO Troy Reeb added that new lifestyle brands Flavour Network and Home Network have exceeded expectations. Based on data provided by the broadcaster, Global TV saw audience growth of 11% for the full day and 25% in core primetime, season-to-date, while total monthly hours streamed across the company’s STACKTV, Global TV app and Pluto TV platforms, grew by 18% over the winter.
Reeb told an earnings call that ad sales were particularly challenged in its speciality channel portfolio, mainly due to an over-supply of digital inventory in the broader market.
As the company factors the potential impact of U.S. tariffs into its outlook, Reeb said Corus believes it’s their responsibility as a network to champion the “shop Canadian” message, working closely with its clients to offer a variety of ways to show support to the movement and help advertisers connect with their Canadian customers by offering new integration opportunities.
The company reported free cash flow of $46.0 million in Q2 and $35.9 million year-to-date and net debt to segment profit of 5.04 times as of Feb. 28, up from 3.84 times at the end of August.
The company announced an updated credit facility last month, removing certain limitations on how Corus can use its excess cash and increasing its maximum Total Debt to Cash Flow Ratio to 9.5:1.00 through Dec. 31 of this year.
