ABS-CBN losses soar as GMA Network income declines

The financial strain on the country’s major media networks continues as GMA Network Inc. and ABS-CBN Corp. report significant declines in earnings.

GMA Network faced a substantial drop in net income due to the absence of political advertisements, while ABS-CBN continued to incur heavy losses from its broadband and cable television unit.

In recent disclosures to the stock exchange, GMA Network, led by the Gozon family, revealed a 42 percent decrease in net income, which fell to P3.17 billion. Conversely, the Lopez-led ABS-CBN reported a dramatic increase in net losses, which ballooned to P12.8 billion from P2.6 billion the previous year.

GMA Network’s revenue dropped by 13 percent to P18.64 billion, driven by a decrease in advertising sales, which fell to P17.18 billion from P20.23 billion. The network highlighted that the lack of over P3 billion in political advertisements severely impacted its flagship channel, GMA Network, and its radio segment. Advertising sales constituted over 90 percent of GMA Network’s total revenues for the year.

ABS-CBN’s revenue remained relatively stable at P18.51 billion, slightly down from P18.55 billion. While regular advertising revenue increased by 16 percent, this gain was offset by a decline in consumer sales. A significant factor in ABS-CBN’s poor financial performance was a P9.1-billion impairment loss in its broadband and cable television unit, Sky Cable, marking a permanent reduction in asset value.

Earlier this year, ABS-CBN terminated the P6.75-billion sale of Sky Cable to PLDT Inc., led by Manuel Pangilinan. This decision necessitated ABS-CBN to find alternative methods to address its debt obligations, which stood at P12.6 billion by the end of 2023. The company is currently negotiating with lenders to extend its debt repayment deadline to June 30, 2024, from the previous deadline of December 31, 2023.

Both media giants also experienced increased production costs. ABS-CBN’s expenditure on prime-time programs and movies rose by 2 percent to P7.41 billion, while GMA Network’s production costs increased to P8.17 billion from P7.48 billion.

Despite these financial challenges, GMA Network and ABS-CBN have engaged in several collaborative ventures. Notably, ABS-CBN’s popular noontime show ‘It’s Showtime’ began airing on GMA Network earlier this year, replacing ‘Tahanang Pinakamasaya.’ This partnership follows their historic co-production agreement for the TV series ‘Unbreak My Heart,’ featuring artists from both networks.