Nine Entertainment shareholders "watched the value of the free-to-air broadcaster" collapse more than A$315M ($237M) to a record low on Tuesday, following a "troubled start" to '16, which included "a dire summer of cricket," according to Max Mason of the SYDNEY MORNING HERALD. The metropolitan broadcaster revealed that TV revenue slumped 11% in the third quarter of the financial year, compared with the previous corresponding period, which Nine said was "also effected by an early Easter and no Cricket World Cup." Nine shares plunged as much as 29%, touching A$1.08 ($.81) -- "the lowest level since the company re-listed on the Australian Securities Exchange" in late '13. Shares finished Tuesday down 23.7% at A$1.16 ($.87). The drop wiped out A$315.5M from Nine's market capitalization with the broadcaster now worth just over A$1B ($750M). The growing importance of sports rights to broadcasters "was underlined by a slew of blockbuster deals" done in '15 when the Australian Football League secured a record A$2.5B ($1.9B), six-year deal, the National Rugby League inked a A$1.8B ($1.4B), five-year deal and the Australian Rugby Union doubled the value of its rights to A$285M ($215M) over five years (SMH, 4/6). In Sydney, Elizabeth Knight reported Nine said that the weather and the standard of the competition "meant that a third of the scheduled days were lost." In a "generally good advertising market, a shorter-than-expected cricket game and a rain downpour would be disappointing but not a disclosable event." But it is a "soft advertising market in an industry that is increasingly falling victim to rapid structural change." Nine said that the revenue performance "was also hit by the absence of the Cricket World Cup event" (which it had in '15) and the early timing of Easter (SMH, 4/5). In London, Smyth & Thompson reported Nine’s emphasis on the "disappointing ratings generated by its cricket coverage prompted analysts to question the appeal of Test match cricket" in an era when short format Twenty20 cricket is "gaining audience share." Morningstar analyst Brian Han said that Nine’s rival Network Ten had "scored a hit with the popularity of its Big Bash T20 cricket league, while Nine’s Test cricket had been bowled over in the summer." Han: "By shortening the matches and making them more exciting Twenty20 cricket is attracting a much younger audience than traditional cricket." Network Ten reported record ratings for its coverage of the Big Bash -- Australia’s Twenty20-style competition (FINANCIAL TIMES, 4/5).
