ABS-CBN reviewing current business models for a “more agile, efficient and effective organization”
MANILA -- ABS-CBN Corp on Thursday said it will continue to explore "all available remedies" and "courses of action" while focusing on its other businesses to drive growth moving forward.
"The denial of the franchise application of ABS-CBN to construct, install, establish, operate, and maintain radio and television broadcasting stations in the Philippines does not affect the primary franchise of ABS-CBN to exist as a corporation and does not affect the rights of its shareholders," the company said in a disclosure to the stock exchange.
The House of Representatives legislative franchises committee recently voted to deny ABS-CBN's bid for a fresh 25-year franchise, while the National Telecommunications Commission ordered the company to stop its digital terrestrial TV network, resulting in massive retrenchments and job loss for thousands of Filipinos.
The franchise denial affected the company's free-to-air advertising business, which accounts for 50 percent of consolidated revenues as of end-September last year.
The company said to mitigate the impact of the franchise denial and the pandemic, it will focus on its other businesses that do not require a legislative franchise - among them, international licensing and distribution, digital and cable businesses, and content syndication through various streaming services.
It also implemented group-wide cost control measures, rationalizing capital expenditures and streamlining manpower.
"Given the reduced operations, the Company is reviewing its current business models, structures, processes and systems, for a more agile, efficient and effective organization," it said while lessening investments on non-core activities to preserve cash.
ABS-CBN said it was also "not aware" of any material contracts, claims or demands, as it is currently in talks with creditor banks on its long term obligations.
"The Company is likewise confident that any payments or financial obligations that may arise under its customary or usual business agreements are manageable and will not have a material adverse impact on ABS-CBN at this time. The Company is committed to honor all existing obligations for goods delivered and services rendered by its third party suppliers and/or to negotiate new terms for these obligations, should it be necessary," it added.
news.abs-cbn.com is the official news website of ABS-CBN Corp.