Cassaday says ad train hasn’t slowed
Corus Entertainment Inc. expects to grow its profitability and raise its dividend in the coming financial year, executives from the Toronto-based media company told analysts in a briefing Wednesday.
Corus owns specialty TV channels such as YTV, radio stations in many Canadian cities and kid-oriented content producers such as the Nelvana animation studio that, its executives say, put the company in good shape for further growth.
Chief executive John Cassaday said one of the positive trends Corus is expecting is growth in advertising sales at its specialty television channels – based on early results for the fiscal first quarter ending Nov. 30.
“That may be the headline this morning, because I think coming out of Q4 there were some questions in people’s mind about whether that train had slowed,” Cassaday said.
“We saw continued momentum on our specialty ad sales in Q1, despite what you read and heard and maybe suspected given the economic conditions that we’re in.”
While the impact of the global economic slowdown has been less severe in Canada than in many other developed countries, several media companies have noted advertisers are wary and watching consumer spending carefully.
“Radio has been somewhat softer than we expected,” Cassaday said.
As noted in a previous Corus briefing, the radio segment had soft add sales in September followed by stronger results in October – the first two months of the current fiscal first quarter.
“What happened in November, we softened a bit again. Not terrible – certainly low single digits – but probably we saw a decline in our radio business.”
There was also significant difficulties in the business that sells products for children aged two to 11 years, based on characters created or owned by the company’s Nelvana animation studio and shown on channels like Treehouse TV.
For instance, sales of DVDs “dried up” in the quarter and revenue from toy sales were down due to the transition of Zellers department stores to Target, Cassaday said.
