Nine CEO Hugh Marks.Credit:Louise Kennerley
Nine's latest initiatives build on the $100 million in savings it is already seeking to extract from its television division,a plan it announced at its half year results in February. Those savings,which included reducing spending on one-off sports events and US programming,will be brought forward where possible.
Chief executive Hugh Marks also previously flagged cost savings in the company's metropolitan publishing division through efficiencies in printing,distribution and output deals like newswire service AAP,which is facing the prospect of closure.
The announcement,posted to the ASX,comes two weeks after Nine withdrew earnings guidance,citing"quarter four uncertainty".
On the assumption the NRL season is cancelled,$130 million will be saved by the company,while changes to the timing of local content will save almost $30 million. The company will also reduce sales and production costs and remove bonuses and commissions,a decision which will save $68 million. Deferral of spectrum payments will save $10 million this financial year,while deferral of capital expenditure projects will save $30 million.
The savings on content and spectrum will hinge on assistance from the Morrison government. Last week,The Sydney Morning Herald andThe Age revealed Communications Minister Paul Fletcherwas considering providing temporary relief from spectrum tax fees and forbearance of content quotas,but no formal announcement has been made.
Nine chief executive Hugh Marks said he was confident the business would emerge from COVID-19 as"stronger"and"more competitive"despite expecting a'material negative impact'on advertising from April.