by Paul McBeth
Kordia Group, the state-owned communications, made an annual loss of $14.7 million as it wrote down the value of an ageing analogue network ahead of the switch to digital television next year.
The loss was bigger than the $13.8 million targeted in this year’s Statement of Intent, and wider than the loss of $900,000 last year when it took a one-off hit on new tax treatment for the depreciation of buildings. Kordia took a $21.9 million charge, with the write-down accounting for $21 million and the impact of the Canterbury earthquakes adding an extra impairment of $900,000.
Still, the company boosted underlying profit to $7.2 million in the 12 months ended June 30, compared to $2.2 million a year ago, and will look to resume dividend payments next year, it said.
Kordia lifted revenue 14% to $295 million, beating the $283.4 million target, while earnings before interest, tax, depreciation and amortisation rose to $51.3 million from $50.8 million a year ago, also ahead of the expected $50 million.
“Strong performances were delivered by both Kordia Solutions and Orcon showing revenue increases of 12% and 31% respectively,” the company said in a statement.
Kordia has had to focus on new revenue streams after the government decided to free up radio spectrum for newer mobile technology by axing analogue TV in favour of a digital signal. That was initially scheduled for 2015, but Broadcasting Minister Jonathan Coleman last year brought that forward to start in 2012.
Chief executive Geoff Hunt said the group wants to resume paying dividends on the back of the stronger underlying earnings. Kordia continued to repay debt through the year, with net debt now at $73.8 million.
The state-owned enterprise was valued at $198.5 million in the government’s 2010 investment statement.