SCA’s Grant Blackley on ‘historically low’ debt and the power of digital
Media business Southern Cross Austereo (SCA) was able to point to a ‘historically low’ debt on its balance sheet during its results presentation yesterday and a sizable cash reserve, providing it with liquidity during a time when that’s never been more important. CEO Grant Blackley spoke with Mumbrella’s Hannah Blackiston about how important that financial confidence is for SCA and the future of audio.
Earlier this year, Southern Cross Austereo paused trading to announce an equity raising round. The $169m it looked to raise would be used to boost liquidity and pay down its debt, then sitting around $292.6m.
Fast forward to its FY20 results and the company is holding firmly to the $160.8m it raised, giving it a total of $272m in cash and reducing its debt to a ‘historically low’ level of $131.6m. But SCA CEO Grant Blackley isn’t planning on splashing the cash anytime soon.
“We’ve reduced our debt by around 55% following the capital raising in early April which was to provide liquidity for us, given the unchartered waters we were about to go through. Pleasingly, with all the initiatives we’ve implemented across the business, while there’s been a dramatic decline in revenue, particularly across April, we actually managed the business through without utilising those capital raising funds,” he told Mumbrella.
So why then did SCA bank 10m as a commitment to regional radio and a further 16m in Job Keeper? They blame the pandemic but their plans were made in advance of March this year and still cashed in.