GMA Network, Inc. rallied in the third quarter, coming from a lackluster second quarter financial performance, as the Philippine economy started to reopen and with its top rival out of the picture.
In a disclosure to the Philippine Stock Exchange, the firm said attributable net income tripled to P2.94 billion in the third quarter of 2020 from the P832.64 million earned in the same period last year.
Its third quarter performance allowed GMA to register a 78 percent jump in profits to P3.9 billion for the first nine months of the year from P2.18 billion in the same period of 2019.
GMA said the Community Quarantine affected most of the company’s business partners especially during the initial months of the lockdown as a wait-and-see strategy was observed, resulting in cutback in advertising spending.
“But come June this year, the levels of community quarantines have begun transitioning into an atmosphere that is more encouraging for businesses to resume as health protocols started to ease off allowing the economy to regain strength,” it noted.
GMA said that, “With some reformatting done to focus on News and Public information, the Company’s top line was able to make a quick turn-around. The closure of biggest rival, ABS-CBN, due to the expiration of their broadcast franchise last May 5 and the subsequent denial last July 10 by the House Committee on Legislative Franchises of ABS-CBN’s new application also contributed to the increase in sales due to the shift in some advertising placements.”
This development partly counterbalanced the general reduction in sales brought about by the slowdown in economic activities due to the pandemic/Enhanced Community Quarantine (ECQ).
For the first nine months of the year, consolidated revenues improved 4 percent to P12.66 billion from P12.22 billion in the same period last year.
It must be noted that last year even included non-recurring election-related revenues of P758 million. Sans the windfall in 2019 from political advocacies and advertisements, as well as this year’s sale of GMA Affordabox, recurring revenues posted an improvement of 7 percent.
For the third quarter, revenues rose 37 percent to P5.91 billion in 2020 from P4.3 billion in 2019.
Consolidated advertising revenues (airtime, online, international) which comprised 91 percent of the Company’s revenue pie, wrapped up at P11.47 billion in the first nine months of 2020, up by 2 percent from last year’s P11.26 billion.