Southern Cross Media Group has released its first full-year earnings report since merging with Seven West Media, creating one of Australia's largest diversified media companies spanning free-to-air television, radio, and publishing. The results highlight the challenges ahead in making the combined entity consistently profitable amid a structural shift in advertising spending toward global digital platforms.

The group reported pro forma gross revenue of $1.87 billion for FY26, a 4.5% decline from the prior year. Net profit after tax fell by more than half to $9.9 million, down from $23.3 million.

The headline figure conceals a stark divergence within the business. Southern Cross Media's audio division continued to expand and delivered strong profitability, while the television unit suffered a sharp contraction in advertising revenue and a corresponding earnings decline.

Leadership Response and Cost Reduction Program

CEO Rohan Lund, who assumed the role in May, described it as "a tough year" and signalled that operational efficiency would remain a key priority.

The company has launched an expanded savings initiative targeting $145 million to $150 million in annualised cost reductions. Lund indicated that this program should not be considered the final step in the group's cost-reduction efforts, leaving open the possibility of additional restructuring and further job losses. The company has already eliminated at least 250 positions.

Television Segment Under Pressure

Television revenue declined 6.6% to $1.25 billion. Despite audience share gains, advertising revenue fell significantly. The group reported that advertisers withdrew $125 million from the Seven television network during the year, though $41 million of that decline was mitigated by the network's increased audience share. The contraction reflects a broader pattern across Australia's free-to-air television sector, where metropolitan and regional broadcasters alike have seen ad budgets migrate to platforms such as Meta and Google.

Television digital revenue grew 10.6%, with the 7plus streaming platform continuing to gain audience share. For FY27, the company expects television revenue to be roughly flat year-to-date, supported by Commonwealth Games and AFL broadcast rights that are helping offset a mid-single-digit decline in the broader market.

Audio Delivers Strong Growth

The audio segment stands in sharp contrast to television. Audio revenue increased 1.4% to $429.9 million, while EBITDA climbed 15.5% to $100.4 million. This produced a 23.4% EBITDA margin, well above television's 8.8%. Southern Cross Media's audio portfolio includes major metropolitan radio brands and regional radio networks, a segment that has proven more resilient to digital disruption than free-to-air television, partly because of live content, local presence, and strong listener loyalty.

Digital Growth Across Segments

Digital expansion was evident company-wide. Group digital revenue reached $320.3 million, up 10.7%, comprising 10.6% growth in television digital revenue and a 14.3% increase in audio digital revenue.

Publishing remained the weakest segment, with revenue down 3.1% to $187 million and EBITDA of $26.2 million, although publishing digital revenue still managed 5.7% growth.

Balance Sheet and Outlook

Net debt stood at $362.8 million at June 30, up slightly from $357 million a year earlier. The group's borrowings have been consolidated into a single $569 million facility, with the first maturities not due until FY30.

The company now operates three distinct business units: a television operation navigating a structurally challenging advertising market, an audio business generating stronger growth and margins, and a publishing division in decline but building its digital presence.

Looking ahead, television revenue is reportedly flat so far in FY27, supported by Commonwealth Games and AFL rights, while the broader market remains down by mid-single digits. Audio revenue continues to grow at low single-digit rates, and publishing is steady. This suggests the immediate outlook is stable but does not signal a rapid recovery in the group's underlying advertising conditions.