Ten Network (ASX:TEN) saw its profit fall 15.6% during what interim CEO Lachlan Murdoch called a “not acceptable” first half.
The company reported a profit of $49.6 million, despite a 2.2% increase in group revenue to $484.2 million.
“The half year results are not acceptable and immediate action is already underway to address them,” he said, adding that the results “do not demonstrate Ten's underlying...potential.”
Murdoch said Ten was being restructured to focus on its core strengths, and cost-cutting efforts are underway across the group.
The company's performance in the first half was impacted by one-off costs of $25 million in the 2010 Delhi Commonwealth Games, and return from the event was lower than expected.
Television revenue grew only 2.2%, but TV ebitda was $3 million higher than expected at $95 million.
The launch of new channel Eleven also accrued costs, and the timing of the launch – after the competitors' third channels – also hurt 1H earnings potential, Ten said.
Another initiative is the relaunch of channel One with a widened focus to drama, movies and documentaries as well as sport. The company aims for an at least 2.5% audience share from the relaunched network.
The company said it had taken a $7.1 million non-recurring charge in the first half to cover television restructuring costs.
The company's EYE out of home business, which Ten acknowledged has historically yielded an unsatisfactory return to shareholders, grew its revenue 15% during the half on the improved performance of its Australian operations.
TEN shares fell 1.5% in Thursday's trading to $1.315.
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