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TEN NETWORK HOLDINGS LIMITED (TEN)

TEN NETWORK HOLDINGS LIMITED (TEN)

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General Information
Company Name: Ten Network Holdings Limited
Stock Code: TEN
Website: www.ten.com.au
GICS Sub-Industry: Broadcasting
Market Cap ($M): 747
Equiv. Shares (M): 1,045

Current Price Data+
Current Price Open High Low Last Close Volume Price Movement
 $ 0.715 $ 0.710 $ 0.730 $ 0.710 $ 0.710 1,501,945 $ 0.005  0.704 %

Current Broker Consensus Recommendation more
Recommendation: Sell
Recommendation Date: 25th May 2012
12 Month Target Price (average): $0.816
Brokers Surveyed: 8

Company Overview

Business Description:
Ten Network Holdings Limited (TEN) invests in The Ten Group Pty Limited and controlled entities which operates multi-channel commercial television licences in Sydney, Melbourne, Brisbane, Adelaide and Perth, and EYE Group which operates Out-of-Home advertising.

Strategy Analysis:
TENs strategy is to balance its ability to generate high returns by keeping costs low and investing in new programming to increase revenues. TEN is focused at appealing to the younger age group viewers. This targeted approach has enabled TEN to deliver the highest industry margin. Margins have recently been diluted as TEN invests in a bigger inventory of content to increase its revenue share of the market. Ten Network Holdings reported NPAT down 90.5% to $14.18m for the year ended 31 August 2011. Revenues from ordinary activities were $1.0bn, up 1% from last year. Diluted EPS was 1.36 cents compared to 14.35 cents last year. Net operating cash flow was $6.31m compared to $7.83m last year. The final dividend declared was 6 cents and the special dividend was 5 cents, taking the full year dividend to 11 cents compared with nil last year.


Financial Summary
Year to Aug NPAT EPS EPS chg (%) PER DPS Yield (%) Franking (%)
2013  F 58.3 5.6 14.1 12.8 4.0 5.6 100.0
2012  F 51.2 4.9 -30.9 14.6 3.0 4.2 100.0
2011  A 74.1 7.1 -23.5 18.3 5.3 4.0 100.0
Source: Morningstar analyst estimates.

Peer Comparison
EPS Growth (%) P/E (%) Dividend Yield (%)
Company Mkt Cap 2011 A 2012 F 2013 F 2011 A 2012 F 2013 F 2011 A 2012 F 2013 F
Southern Cross Media (SXL) $853 M 0.4144 -0.0344 0.0966 8.0026 8.2877 7.5578 0.0826 0.0732 0.0802
Ten Network (TEN) $742 M -0.2321 -0.5851 0.6034 9.9859 24.0678 15.0106 0.0739 0.0141 0.0466

Market Comparison
Earnings P/E Ratio P/B Ratio P/E Growth P/S Ratio
TEN 1.58 17.7 0.93 10.00 0.75
Market 0.80 12.1 1.33 1.35 1.68
Sector 0.96 8.41 1.20 6.45 0.86

Directors
Name Position Start Date
Hon Cheryl Edwardes Alternate Director 22 June 2011
Mr James Warburton Chief Executive Officer,Managing Director 10 February 2012
Mr Lachlan Keith Murdoch Non-Executive Chairman 13 December 2010
Mr Brian Long Non-Executive Deputy Chairman 01 July 2010
Mr David L Gordon Non-Executive Director 01 April 2000
Mr Dean Hawkins Non-Executive Director 01 April 2010
Mr Paul Mallam Non-Executive Director 13 December 2010
Mrs Gina Rinehart Non-Executive Director 13 December 2010
Ms Christine Wendy Holgate Non-Executive Director,Alternate Director - David Gordon 01 April 2010
Mr Paul V Gleeson Non-Executive Director,Alternate Director - Jack Cowin 16 February 1998
Mr Jack J Cowin Non-Executive Director,Alternate Director - Paul Gleeson 03 April 1998

Management
Name Position
G Thorley Chief Executive Officer - Eye Corp
Paul Anderson Chief Financial Officer
K Kingston Chief Operating Officer
D Mott Chief Programming Officer
Stephen Partington General Counsel, Company Secretary
D White General Manager Sport

Substantial Shareholders
Holding Name
79,015,800 (8.68%) Perpetual Limited and subsidiaries
93,422,456 (8.94%) Lachlan Keith Murdoch and Illyria Nominees Television Pty Ltd
146,559,823 (14.02%) Birketu Pty Ltd
104,613,672 (10.01%) HPPL Group
52,496,190 (5.02%) Commonwealth Bank of Australia
93,422,456 (8.94%) James Douglas Packer and Consolidated Press Holdings Limited

Calendar of Events
Date Event
11 April 2013 Report (Interim)
14 November 2012 Report (Annual)
25 October 2012 Report (Prelim)
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