SXL resets the business as digital revenue climbs 11% to $320M
In its 2026 Investor Presentation covering the financial year ended 30 June 2026, Southern Cross Media Group (ASX: SXL) detailed a business reset built around digital growth and cost discipline, with digital revenue up 10.7% to $320.3M.
Group revenue came in at $1,869.6M (down 4.4%), EBITDA excluding onerous contracts at $191.9M, and net profit after tax (NPAT) at $9.9M. Management framed the year around three themes: leading market positions, an underway financial reset, and a strategy leveraging its multi-platform portfolio.
The company noted $30M in merger synergies delivered a year early, a $145–$150 million cost-out program underway, and a $569 million syndicated facility now in place. All figures are presented on a pro forma basis, as if the SCA/SWM merger had applied for the full period.
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Market headwinds meet disciplined cost management
The presentation attributed the revenue decline primarily to a soft advertising market, particularly in television, partly offset by share gains and digital revenue growth. Management highlighted that the company retained its #1 TV and Audio networks and #1 WA publisher positions through the year.
| Metric | FY26 | FY25 | Change |
|---|---|---|---|
| Total revenue | $1,869.6M | $1,958.2M | (4.5%) |
| EBITDA (exc onerous) | $191.9M | $227.6M | (15.8%) |
| Digital revenue | $320.3M | $289.3M | +10.7% |
| NPAT | $9.9M | $23.3M | (57.6%) |
| EBITDA margin | 10.3% | 11.6% | (1.4 ppt) |
Management detailed the revenue bridge as a $125M market contraction impact, partly offset by a $41M share growth impact. Key share metrics included:
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Total TV revenue share of 41.6% (up 1.2 ppt).
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Metro Audio share of 30.0% (up 1.7 ppt).
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NPAT was affected by $33M of significant items tied to the merger and restructuring.
Audio delivers a stand-out result as digital outpaces broadcast decline
The divisional narrative centred on Audio, which the presentation described as a stand-out result. Management outlined a reset that positions the combined portfolio for growth and value, underpinned by culture and trust, with content advertisers trust and audiences choose.
Audio division profitability had already shown strong momentum heading into the full year, with H1 FY26 delivering 28% EBITDA growth to $40 million even as metro radio advertising markets fell 7%, and LiSTNR’s digital segment reaching cashflow positive status for the first time.
The presentation’s key messages, delivered by Group Managing Director and CEO Rohan Lund, centred on a business reset and building for growth and value, underpinned by leading market positions and a strengthened financial base.
Divisional highlights from the presentation included:
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Audio — EBITDA up 15.5% to $100.4M at a 23.4% margin, with digital revenue up 14.3%. Digital offset the decline in broadcast revenues for the first time.
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TV — revenue down 6.6% on a soft ad market, but a record 42.5% audience share outside an Olympics year, with 7plus streaming minutes up 53% and BVOD share of 41.6%.
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Publishing — EBITDA of $26.2M with margin steady at 14.0%. The West Australian monthly audience rose to 3.5M and The Nightly digital edition opens climbed 24.6%.
| EBITDA (exc onerous) $M | TV | Audio | Publishing | Corporate | Group |
|---|---|---|---|---|---|
| FY26 | 109.6 | 100.4 | 26.2 | (44.3) | 191.9 |
| Margin | 8.8% | 23.4% | 14.0% | n.m. | 10.3% |
What the SCA/SWM merger means for investors
The SCA/SWM merger created a multi-platform media group spanning broadcast television (Seven), audio (Triple M, Hit, LiSTNR), publishing (The West Australian, The Nightly) and digital assets.
In plain terms, “synergies” refers to the cost savings realised when two businesses combine and remove duplication, while a “cost-out program” targets further efficiency to lift margins over time. The pro forma basis shows figures as if the merger had applied for the full year, enabling like-for-like comparison.
Why does this matter to investors? The presentation pointed to combined reach of more than 20M Australians and a 38% overlap between audio listeners and Seven viewers, supported by 17.8 million first-party data records. Management positioned this scale and data as increasingly valuable to advertisers, which in turn supports revenue potential.
Financial reset builds a leaner base
The balance sheet and cost program formed the foundation of the reset. Key figures management outlined included:
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A $569M cross-Group syndicated facility arranged by ANZ, Commonwealth Bank and Westpac as Mandated Lead Arrangers, with no syndicated maturities until July 2029.
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Total syndicated commitments reduced by $116M, with reported leverage of 1.8x against a covenant of below 3.25x.
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$30M merger synergies delivered a year ahead of schedule.
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A $145–$150 million cost-out program targeting run-rate savings, expected to be substantially delivered by end FY27, with 250 FTE (~8%) having departed during FY26.
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Net debt of $362.8M and a cash balance of $142.2M.
FY27 priorities and trading outlook
Management presented its stated priorities and early FY27 trading conditions. For Q1 FY27, the presentation noted:
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Television revenue tracking flat year-on-year, with share gains from the Commonwealth Games and AFL finals offsetting a market down mid-single digits.
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Audio revenue up low single digits, and Publishing revenue stable year-on-year.
On the broader outlook, management described the advertising market as remaining “short and volatile” with variable consumer and advertiser sentiment. Total operating expenses are expected to grow below inflation, with cost-out actions tracking to plan for FY27 delivery, while one-off costs are anticipated for major sport events including the Commonwealth Games and Rugby League World Cup.
Strategic priorities outlined included extending audience gains, embedding Total TV and Total Audio market propositions, productising first-party data assets, and converting advertisers from single to multi-platform. The presentation framed FY26 as a reset year, with the combined portfolio positioned for a shift from headwinds to growth.
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