Survive til ’25: With one quarter done, we’ve ranked winners and losers for 2024 so far
Welcome to a Tuesday update from Unmade, in which we look back on a bumpy first quarter of the calendar year. Below, we’ll crunch the numbers to tell you which ASX-listed media and marketing companies did best and worst.
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How News Corp and Enero found momentum in a hard place while Seven and Nine came down to earth
So that’s 2024 quarter-way done.
Or if you prefer to navigate your business life by the financial year, that was the end of Q3.
When it comes to the local ASX listed media and marketing companies, the first and third quarters are the ones where we learn the least. Most companies only issue half year numbers.
Instead, the market trades more on sentiment – an informed view on how the market is travelling.
Meanwhile, thinking in board rooms is turning to whether they can deliver investors the profit number they promised. With the market still sluggish, the drip-drip of redundancies will likely get louder over the next thee months as financial year end approaches.
This week The Ankler podcast, which analyses the media and entertainment industry from a US perspective summed it up: “Survive til 25” is the name of the game for the media industry.
The Unmade Index, which is our chart of the relative movement of listed media and marketing stocks, was down somewhat for the quarter. After ending 2023 on 628.87 points, the Unmade Index ended this quarter on 579.44 points. That’s a drop of 7.9% for the quarter.
Perhaps more significant though is the long term trend. The Unmade Index started at the beginning of 2022 on a nominal 1000 points. That means that over the nine quarters since then, investors in local media and marketing stocks have lost 42% of their money.
However, within that index, there have been winners and losers. To work out who has fared best – and worst – this quarter we’ve examined performance not just based on percentage movement, but also in absolute terms based on market capitalisation. We’ll share that data below the paywall.
Depending on methodology, the winners include News Corp and Enero Group, while the biggest losers include Nine and Seven West Media.
First, to the winners and losers by market capitalisation.
Market valuation movement ranking
On this metric, News Corp investors had the best time of it, and Nine the worst.
News Corp is the only US-headquartered company featured in this analysis because it is dual listed in the US and Australia. During the first quarter, News Corp’s market capitalisation grew by US$1.4bn (AU$2.2bn).
Turning to pureplay ANZ businesses, in second place, some way behind, came outdoor media company Ooh Media which grew its market cap by $67.3m.
Next was IVE Group which improved by $27.7m. Enero, Vinyl Group and Sports Entertainment Group all also finished in positive territory.
Looking at those companies that went backwards, in terms of absolute market capitalisation, Nine lost the most, losing just over half a billion dollars.
Some of that was because of the decline of Nine’s real estate platform Domain of which it owns 60%. A reasonable assumption though is that only $60m of Nine’s decline could be attributed to Domain. The other $440m of decline belongs with a changed assessment of the value of Nine’s main ad-supported media assets in TV, publishing and radio.
Seven West Media, similarly exposed to the advertising market, was the next biggest loser, dropping by $115.7m in value.
Meanwhile, ARN came back down to earth after surging upwards when it first announced its takeover bid for Southern Cross Austereo in the previous quarter. Its valuation faded by $37.6m in the quarter. SCA also lost a little ground, dropping $9.6m. It likely remained artificially high thanks to the ongoing takeover bid.
Meanwhile, the other out of home company on the Unmade Index, Motio, effectively stood still in the quarter, with its valuation falling by $300,000.
Percentage change ranking
On the ranking of percentage movement – which is arguably what individual investors would care about, Seven West Media fared by far the worst, while the modest recovery of Enero created an impressive stat for the quarter, up by 16.45%
Percentage movement saw several of the micro and small cap companies do well. SEG bounced back by 15% despite concerns about the company’s viability, and Vinyl Group grew 14.29% after raising new funds for its takeover of Brag Media.
After Seven’s 29.63% decline for the quarter, Pureprofile was next, losing 23.33% despite its continuing steady crawl towards solid ground.
Then came Nine, losing 15.35%.
We’re around four months from the next set of solid data as most comnpanbies report their full financial year numbers. The possibility that the advertising market has not hit bottom still exists, but everyone is now focusing on signs of it lifting again.
That will take a little longer. Like they say: Survive til 25.
Time to leave you to your Tuesday. I’ll be back with more tomorrow. Thanks as always for supporting Unmade.
Toodlepip,
Tim Burrowes
Publisher – Unmade
tim@unmade.media
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