MANILA - ABS-CBN Corp. on Thursday said it suffered a net loss in the first half of the year, as the pandemic and non-renewal of its franchise hurt earnings.
Net loss stood at P3.93 billion for the January to June period, a reversal from its net income of P1.498 billion in the same period last year, ABS-CBN told the stock exchange.
Consolidated revenues from advertising and consumer sales dropped 36 percent to P7.5 billion for the period, it said.
Advertising revenues however, saw a sharp decline in the second quarter, after the National Telecommunications Commission (NTC) issued cease and desist orders (CDO) against ABS-CBN on its broadcast operations and digital TV transmission.
"These events in addition to the COVID-19 pandemic that the country is facing, drove down both the advertising and consumer revenues of the Company," it added.
The House of Representatives legislative franchises committee in July 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.
Three of the the company's four business segments posted net losses.
Media Networks and Studio Entertainment, which covers parent channel ABS-CBN, Sports+Action and Cinema One among others, saw operating revenues halved in the first half at P7.387 billion from P14.997 billion in the same period last year. Net loss was at P3.581 billion.
Digital and Interactive Media posted a net loss of P347 million, while Consumer Product and Experiences segment, which operates live events, theme parks and home shopping among others, saw a net loss of P117 million.
Cable, Satellite and Broadband segment swung to profit in the first half with a net income of P115 million from a net loss of P71 million in the same period last year.
"Sky’s revenue increased by P485 million or 10.4 percent year-on-year. The increase in Sky’s performance was triggered by the increase in broadband and DTH subscribers by 56 and 405 thousand, respectively," it said.
The company earlier 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.
"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.
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