TVNZ sells more land to SkyCity
Television New Zealand says it will sell more of its central Auckland offices and land to SkyCity for $10.6 million and use the proceeds to upgrade its online services.
The state-owned broadcaster today reported a 1.6 per cent rise in net profit to $14.4m despite a 5 per cent slide in revenue to $362.1m.
TVNZ said it had decided to fast track its investment in new technology over two years in response to rapid growth in its online services, TVNZ Ondemand and its One News online stream.
The proceeds from the sale of its remaining Hobson Street properties to SkyCity would also mean it could refurbish its main Auckland building on Victoria St West, which would then house all its Auckland staff.
TVNZ sold its other offices at 93 Hobson Street to SkyCity in July for $5.25m. They will be used for SkyCity's new international convention centre.
While the TVNZ refurbishment is underway, up to 500 staff will be temporarily accommodated in Telecom's Auckland office building for up to two years.
Chief executive Kevin Kenrick said SkyCity's interest in its remaining Hobson St properties was ''a unique opportunity too good to ignore''.
''We are currently in a pre-internet building with the limitations typical of office designs of that age, and we were facing the need for significant repair and maintenance work before very long. The decision to invest heavily in upgrading our online technology had already been made. So to have the opportunity to integrate the new technology into a purpose-designed new workspace will be a game-changer for us,'' he said.
Kenrick said TVNZ's annual profit was $400,000 ahead of forecast and a ''satisfactory result in a year characterised by an on-going focus on aligning the cost structure of the business to market reality, coupled with a slower than expected advertising market''.
The revenue drop partly reflected the loss of government funding for axed channel TVNZ 7.
Advertising revenue dropped by $6.6m.
Kenrick said the highlight was a 21 per cent rise in digital media revenues.
TVNZ and SkyCity occupy blocks across the road from each other in Auckland's CBD.
Economic development minister Steven Joyce indicated in July there may be a further deal over land, and gave the broadcaster and SkyCity two months to complete it.
Construction will begin on the $402m convention centre next year and it's due to be finished in 2017.
The deal struck by the government and SkyCity has been controversial. Opponents argue the casino operator was given special treatment in return for footing the bill for the convention centre. And anti-gambling opponents object as the operator will get 230 extra pokie machines and 40 extra gaming tables. Its gaming licence was also extended.
Legislation enacting the deal is currently before Parliament's commerce select committee.