Media conglomerate PT Global Mediacom (BMTR) â the entity that runs local TV stations RCTI, MNC TV and Global TV â was hit hard by foreign exchange losses in the third quarter of 2015
edia conglomerate PT Global Mediacom (BMTR) ' the entity that runs local TV stations RCTI, MNC TV and Global TV ' was hit hard by foreign exchange losses in the third quarter of 2015.
Global Mediacom chief financial officer Oerianto Guyandi said in Jakarta on Tuesday that heavy foreign exchange losses had led the company to suffer net loss of Rp 324 billion (US$23.8 million) in the third quarter, a reverse from a net profit of Rp 184 billion in the same period last year.
Oerianto attributed the result to increased unrealized forex losses caused by the poor performance of the rupiah against the US dollar in September, when the Indonesian currency fell sharply to Rp 14,657 per dollar.
Unrealized forex losses, he said, had dropped to Rp 226 billion as of Oct. 28, by which time the rupiah had strengthened to Rp 13,630 per dollar.
'Without forex losses, our company would have booked a profit of Rp 227 billion,' Oerianto told reporters at the Investor Summit and Capital Market Expo on Tuesday.
Besides Global Mediacom, other media companies have also reported losses stemming from ballooning forex losses. Earlier in October, PT Visi Media Asia (VIVA) reported a loss of Rp 245 billion in the year's first semester, Rp 112 billion of which was driven by the rupiah's depreciation.
Meanwhile, Global Media's consolidated revenue declined 2 percent year-on-year to Rp 2.6 billion in the July-September period, 59 percent of which came from advertising and content revenue.
Aside from the sliding rupiah, Oerianto said, the media industry was also hit by stagnant advertising sales.
'In the first two quarters of the year, advertising revenue was flat, but ours was higher than the industry average. Hopefully by the fourth quarter, clients will begin to spend again fueled by the hopes of a rupiah bounce-back,' he explained.
Earlier this year, subsidiary company PT MNC opened a new production studio, eating a significant portion of the company's capital expenditure for 2015. In 2016, MNC Group director David Audy said that the company planned to focus on increasing its production capacity and the quality of its networks' television shows.
'We have the equipment ready now, so that's mostly going to be our focus,' he reiterated. Sixty percent of Global Mediacom's revenue is contributed by MNC.
MNC has estimated that it will require $20 million to $25 million for its capital expenditure in 2016, while Global Mediacom says that its capex would be less than Rp 2 trillion because the company would not build any production studio during the year. As of September, Rp 1.5 trillion of the company's 2015 capex has been realized.
Oerianto added that Global Mediacom planned to achieve growth of 4 to 5 percent, saying that the company was fairly optimistic about business trends and the forex rate in the future.
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