Listed media firms poised for Q2 growth on election ads

By Ashley Erika O. Jose, Reporter

LISTED media companies are expected to sustain growth in the second quarter, supported by anticipated revenue gains from election-related advertisements, according to analysts.

“Considering the results of listed Philippine media companies in the first quarter, several factors must be examined, particularly their advertising revenue trends, as these significantly affect media firms,” Globalinks Securities and Stocks, Inc. Head of Sales Trading Toby Allan C. Arce said in a Viber message.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said midterm election-related advertisements would provide a boost to listed media companies in the second quarter.

“However, there could be some shift toward digital media channels as an increasing number of people use their smartphones as a major source of news, entertainment, information, education, and interaction,” Mr. Ricafort said.

Philippine media companies recorded increases in their revenues in the first quarter, driven by growth in advertisement revenues during the period.

“Since elections fall in the second quarter, media firms could see a surge in ad revenues,” Mr. Arce of Globalinks Securities said.

Mr. Arce added that companies investing in digital platforms would likely see higher engagement and advertisement revenues, driven by consumer preference for online content.

ABS-CBN Corp. narrowed its attributable net loss for the first quarter to P425.65 million from P841.54 million due to higher revenues during the period.

For the January-to-March period, ABS-CBN posted gross revenue of P4.23 billion, marking a 3.68% increase from P4.08 billion in the same period last year.

Broken down, ABS-CBN recorded total advertising and consumer revenue of P3.18 billion, up by 20.91% from P2.63 billion a year ago, while revenues from cable television and broadband declined by 26.9% to P1.06 billion from P1.45 billion previously.

Meanwhile, GMA Network, Inc. saw its first-quarter attributable net income rise more than threefold to P801.68 million from P204.12 million a year earlier, mainly driven by a surge in advertising revenues.

For the first three months, GMA Network reported a combined revenue of P4.68 billion, 27.87% higher than the P3.66 billion recorded a year earlier.

According to its financial statement, advertising revenues accounted for the majority of its top line during the period at P4.34 billion, up by 29.17% from P3.36 billion, while consumer sales climbed by 17.97% to P345.85 million from P293.17 million.

Further, Mr. Arce said the continuing post-pandemic recovery may also boost spending and indirectly support advertising.

The Philippine economy expanded by 5.4% in the first quarter, slightly faster than the 5.3% growth in the previous three-month period but slower than the 5.9% pace in the same quarter last year.

“Streamlining operations and adopting efficient technologies can support profit margins despite mixed top-line performance,” Mr. Arce said, adding that the shift of media companies toward digital platforms could also support their growth during the period.