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Inspiring New Zealanders on Every Screen

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Inspiring New Zealanders on Every Screen Inspiring New Zealanders on Every Screen 4 Chairman’s Introduction 6 Chief Executive’s Overview 10 Financial Performance 11 TVNZ in Society 13 General Charter Measures 14 Charter Performance Measurements 30 Financial Statements 78 Corporate Governance 80 Director’s Profiles 82 Management Structure 83 Main Locations 04 / TVNZ ANNUAL REPORT FY2009 Chairman’s Introduction “TVNZ respoNDED TO THE CHANGE IN MARKET CONDITIONS SWIFTLY...” 05 / TVNZ ANNUAL REPORT FY2009 TVNZ has concluded the year in profit E Tātaringa a te Manukura despite the most challenging market conditions in the industry’s history. Kua oti pai te tau a TVNZ me te whai hua anō ahakoa nga uauatanga pakihi For the first half of the year ki nga maharatanga o te tangata. TVNZ’s revenues were tracking ahead of the prior year. He tino pai te āhua o te tahua putu mo te wāhanga tuatahi o te tau, i But like other advertising-reliant runga noa atu i to te tau i mua. media in New Zealand, TVNZ suffered heavy year on year revenue Engari ko te tino rerekētanga ki etahi declines from the beginning of 2009 atu pakihi pāpāho o te motu, he kaha as the impact of the recession on te hekenga mai i nga tau i o mua tata i our clients’ businesses took hold. te pokiatanga mai o te whakahekenga o nga rawa a o matou kaihoko rato. TVNZ responded to the change in market conditions swiftly with He tere te whakautu a tenei cost reduction initiatives. rōpu mahi ki te hekenga, i kitea wawe nei te whakamāmā i nga Much of the credit for the company’s taumahatanga o nga utu ki a mātou. quick and effective response to the recession must go to TVNZ E tika āna kia rere nga whakapai ki te management and staff. tere me te hāngai o taua whakautu ki te Runanga Urungi me te hunga mahi. The company finished the year with an EBIT of $10.1 million, and a net I te mutunga o te tau, i mua i te whai profit after tax of $2.1 million. The takunga, $10.1 miriona te tahua i kohia Board has approved a shareholder a, i muri mai, $2.1 miriona. Kua whakae dividend of $1.47 million. te Runanga Urungi kia $1.47 miriona te hua hei whakarato ki te kawanatanga. The changes occurring in the media industry are accelerating. As a Kei te tere te huri o nga tikanga result the Board has endorsed a pāpāho. Na kōnei i whakaetia ai e taua revised strategy developed by the Rūnanga i runga anō i te whakaaro Executive to transform the company nuka a te Hunga Whakahaere kia from a Television Broadcaster to whakaumutia nga mahi whakaata, New Zealand’s leading Television ki te kōkiri atu ki te taumata o nga and Digital Media company. whare pakihi Pāpāho Māmati. The vision of “Inspiring New Ko te tūtoru anga whakamua hei “Te Zealanders on every screen” Whakaaratanga o Aotearoa ki nga remains, but with an even stronger Rīanga Whakaata Katoa” ka tū tonu, focus on providing viewers, consumers engari kia hāngai ki nga tikanga e and customers with the content hiahiatia āna e ēra kei te mātaki, kei te and services they want and expect hoko i nga rawa, me erā kei te hangā from the nation’s leading Television rānei i nga hōtaka, kia tū motuhake ai and Digital Media company. hei kōkiri i nga tauira pāpāho māmati. Sir John Anderson - Chairman 06 / TVNZ ANNUAL REPORT FY2009 Chief Executive’s Overview “DESPITE PREDICTIONS TO THE CONTRARY, TELEVISION AUDIENCES ARE AT THEIR HIGHEST LEVELS IN NEARLy 10 years” 07 / TVNZ ANNUAL REPORT FY2009 The impact of the recession has Over 17 days the Olympics was 2. Advertising revenue growth and brought mixed results for TVNZ. watched by more New Zealanders sales ‘go to market’ transformation than any other television event. This year TVNZ’s sales team In the first six months the company embarked on a watershed enjoyed steady progress, building More than a million people watched transformation of the relationship on a remarkable number of initiatives the groundbreaking ONE News with clients, which shifts the focus supporting our strategy of “inspiring YouTube Election Debate, which from a product-driven offering to New Zealanders on every screen” and marked the first time a head of a tailored, customer solution. returning profitability to the company. a national government and the challenger for the top job had In order to align TVNZ’s sales process Then in the second half of the appeared in a live televised debate to to the evolution of TVNZ as a year the impact of the global answer questions posted via YouTube. business, TVNZ Sales has become a and domestic recession took business-focused partner for strategic hold with advertisers, leading to Election night coverage itself agencies and clients. This evolution a sharp downturn in revenue. reached 1.9 million viewers has filled a void in the market, during the course of the night. As a result, the priorities we set in with advertisers wanting greater our Statement of Intent have taken By January, ONE News had achieved integration with media partners. on a form somewhat different to a run of 13 consecutive months of year TVNZ Sales has undertaken to fully that envisaged at the start of the on year growth, with the News content understand the business issues year, and the company has had to expanded and enhanced online via of its clients, to become a trusted demonstrate a new level of agility and tvnz.co.nz and, from August, msn’s business consultant rather than just adaptability to bring us to the close local news and entertainment website. an implementer of a media idea. A of the year as a profitable entity. As part of the implementation of the number of advertisers have embraced The Company’s progress against its Maori programme strategy, Te Karere this new approach to develop and business priorities is set out below: doubled in length, its production costs execute innovative new advertising topped up with commercial revenue; scenarios. Notable examples are 1. TV ONE and TV2 channel its reach has increased substantially, the Ford Fiesta “This is Music” turnaround and content from 735,400 viewers in June 2008 vignette series which used TVNZ strategies implementation to 1,045,000 viewers in June 2009. programme production resources Despite predictions to the contrary, to create a series of 8 programme- television audiences are at their TV2 has performed exceptionally well, like vignettes playing across TVNZ highest levels in nearly 10 years. with June ratings up 33% on the prior on-air and digital media channels; year. It has enjoyed a strong rebound the fully interactive Noel Leeming TV ONE has concluded the year with from the impact of the US writers’ partnership with Wheel of Fortune; strong prime time ratings, particularly strike, and a very pleasing public and the on-air sponsorship and in- in the critical 8.30-9.30pm time zone. response to local productions such as store promotional activity by Tip Top Go Girls and Illegal New Zealand. in partnership with Stars in Their Eyes. TV ONE has successfully launched a number of new local programmes For the first six months of 2009, TV2’s 3. Fiscal turnaround momentum including The Politically Incorrect average audience in peak time [6pm The impact of global recession on Parenting Show, The Missing and a – 10.30pm] was up 10% on the same our advertisers was sharply felt at second series of The Investigator as time in 2008, and the highest since the start of the March quarter, with well as some acclaimed international 2006. Daytime audience levels in the a further deterioration in the June dramas such as Packed to the 5+ demographic were the highest quarter. From a position of 1.1% Rafters and Eleventh Hour. Other since 2004. In the commercially growth over the 2007 calendar year, core local shows such as Fair Go, important demographic of Household the company moved to a defensive Country Calendar and Sunday have Shoppers with Kids aged 0-14, June position, taking rapid action in a all performed strongly through the 2009 was the highest rating month programme to remove $25 million of last quarter of the financial year. since June 1996 – a 13 year high. cost from the business before the end of the financial year. Regrettably, this TVNZ’s multiplatform coverage of the The channel is well positioned to included more than 80 redundancies. Beijing Olympic Games – one of the continue this performance into 2010 most ambitious single projects in our with compelling new international history – has been our most successful. dramas The Mentalist and Fringe and two new local dramas The Cult and This is Not My Life. 8 / TVNZ ANNUAL REPORT FY2009 Chief Executive’s Overview (continued) The combined impact of the The value to television viewership of online every month. This is as well cost-cutting measures has enabled the tvnz.co.nz ondemand catchup as growth in standard television TVNZ to stay profitable. service was amply demonstrated viewing, not instead of it. through research into consumer This stringent focus on behaviours, which proved that a viewer The company has also delivered reducing cost will continue. who could catch up on a missed on its strategic objective of programme online was 13% more responding to consumer demand We are cautiously optimistic about likely to return to the programme for video content and services in the 2010-2011 financial year. At the on television the next week. the broadband environment. It has time of writing the advertising market negotiated a one third shareholding has not yet bottomed out, but we With the predicted growth of interest in the Australian Seven are hopeful that it will have turned media consumption on screens Media Group subsidiary, Hybrid the corner by the middle of 2010.
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