MediaWorks announces $306 million loss
TV and radio broadcaster MediaWorks booked a $306 million loss for the year to August 2011 as the declining broadcast market forced a revaluation of the debt-laden business.
Private equity firm Ironbridge Capital, whose funds bought MediaWorks in 2007 for $561m, revealed the loss for holding company GR Media Holdings today as it readies a second restructuring scheme to pacify lenders.
Most of the red ink came from a a $241.6m goodwill write-off, but the TV3 broadcaster also booked a $17.7m write-down from "one onerous programme cost" and charges related to the switch over from analogue to digital transmission.
The operating numbers showed revenue unchanged from the previous year at $258m, while earnings before interest, tax, depreciation and amortisation were $44.2m, down from $50.1m.
The company's full accounts for the year will be posted to the Companies Office on Monday, and only a financial summary was released today.
Interest costs for the company, totalling $59m, were up 20 per cent from the year earlier - although only $29m of the 2011 figure was paid to banks in cash, with second-tier lenders having their payments capitalised.
The release of MediaWork's financial information - and the acknowledgement of a large write-down in the value of the business - comes as Ironbridge and one-time rival TPG have await the response of lenders to a joint restructuring proposal that will see haircuts all round.
In a statement, Ironbridge said the restructure "will provide the group with a much stronger financial position. Interest costs will be significantly reduced and the funding structure will support future investment in the operating companies as required."
Earlier this week the Australian Financial Review reported private equity firm Oaktree Capital had bought up $125m of debt formerly held by Bank of Scotland International and BNZ for 50 cents in the dollar.
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