A major restructure is underway at Southern Cross Media Group, with up to 300 roles set to disappear as the company moves to slash costs following worsening conditions in the television advertising market.
The company behind Seven, LiSTNR, Triple M, HIT and The West Australian announced the cost reduction program in an ASX update on Thursday, revealing between 250 and 300 full time equivalent positions are expected to leave the business before 30 June.
The move comes less than six months after the merger between Southern Cross Media Group and Seven West Media was completed, with the combined business already delivering $30 million in annualised merger synergies ahead of schedule.
The company says a broader program of savings is now expected to deliver between $145 million and $150 million in annual run rate benefits once fully implemented.
Southern Cross Media Group Managing Director and Chief Executive Officer Rohan Lund said the company was responding to increasingly difficult market conditions while trying to position the business for long term growth.
“We must reset our cost base to meet current market conditions and capture the full benefits of scale across our trusted platforms for our audiences and advertisers, now and into the future.”
Despite reporting audience gains across television, radio and publishing assets, the company said advertising conditions had deteriorated significantly during the fourth quarter, particularly within television. Revenue guidance has been downgraded by around $50 million, with underlying EBITDA now expected to come in between $185 million and $190 million.
The cuts are expected to fall primarily across corporate, mid office and back office functions, with the company saying it plans to remove duplication, streamline operations, automate processes and further refine content acquisition spending.
The announcement also revealed Southern Cross Media Group expects to book a non cash provision of between $65 million and $70 million against a number of inherited television content agreements. While the company has not publicly identified the contracts involved, it said the review reflected subdued economic conditions and ongoing structural changes in the television advertising market.
Southern Cross Media Group is expected to provide further detail when it releases its full year financial results and FY27 outlook on 11 August.
