Corus Entertainment Plunges On Wider Net Loss In Q3 2024
Corus Entertainment Inc. (TSX: CJR.B) released its third-quarter financial results, revealing a notable net loss and underscoring the ongoing challenges within the advertising sector. The company’s consolidated revenue dropped by 16% for the quarter, amounting to $331.8 million, down from $397.3 million the previous year. The net loss attributable to shareholders ballooned to $769.9 million, marking a 56% increase from the same period last year.
Corus reported a sharp decline in consolidated segment profit, which fell by 30% to $67.5 million for the quarter. Segment profit margins also decreased to 20%, down from 24% a year earlier. The television segment, which constitutes the bulk of Corus’ revenue, experienced a 17% decline, bringing in $308.2 million compared to $371.2 million in the third quarter of 2023. Radio revenues also saw a 10% decrease to $23.6 million.
Following the report, the company’s shares declined by as much as 32% at the opening bell.
In response to the financial results, Troy Reeb, Co-Chief Executive Officer, stated, “The third-quarter results reflect the ongoing impacts of a challenging advertising environment. We have secured a top-notch Fall schedule to deploy across our traditional linear and streaming portfolio including STACKTV and the Global TV App. Our team is actively pursuing near-term revenue opportunities, execution of our strategic rebranding initiatives for our top lifestyle services, and swift implementation of efficiency measures.”
Co-CEO and Chief Financial Officer, John Gossling, highlighted the steps taken to address the financial challenges, saying, “As part of our mandate as co-CEOs, we are decisively reducing more costs and taking actions to right-size our business given the realities of our operating environment. We have made difficult decisions to part with certain legacy assets and are identifying additional opportunities to streamline our business with the aim of improving profitability.”
In addition to revenue declines and bigger losses, free cash flow also declined by 29% to $18.4 million. Year-to-date figures also present a downward trend with revenue down by 15% to $1.0 billion and net loss increasing to $747.0 million from $479.1 million compared to last year. However, free cash flow remained steady at $75.0 million.
Current assets ended at $384.5 million while current liabilities came in at $556.3 million.
Corus is undertaking several strategic initiatives to navigate the challenging landscape. The company is implementing cost-cutting measures, rebranding its top lifestyle services, and focusing on streaming and digital platforms to boost revenue. The company also paid down $4.6 million of debt in the third quarter, with a year-to-date reduction of $36.1 million.
Looking ahead, Corus anticipates continued pressure on advertising revenues due to the prolonged U.S. writers’ and actors’ strikes, competition from foreign digital content providers, and a general decline in demand for linear advertising. The company expects television advertising revenue to see year-over-year declines similar to those in the third quarter.
Corus Entertainment last traded at $0.20 on the TSX.
Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
