Radio generates $1.5 billion in revenues during recession

The CRTC released a financial summary for Canada's commercial radio stations yesterday, revealing profits down 5.2% from the previous year.

Canada’s AM and FM radio stations generated $1.5 billion in revenues during the global recession for the broadcast year starting September 2008 and ending August 2009, according to a statistical and financial report from the Canadian Radio-television and Telecommunications Commission (CRTC) released yesterday.

This represents a reduction of 5.2% over the previous year, according to the CRTC, which released summaries for the whole country as well as the figures broken down for individual markets. Much of the loss in revenues came from the lack in syndication of production according to the report (10.2%) however a drop in national time sales (7.98%) played a role as well. Local radio time sales fared better, however there was a still a loss in revenue of 4.7% in this category.

Total expenses for the medium, which employed 10,191 people and paid $632 million in total salaries, also fell this fiscal year by approximately 1.7% to $1.2 billion in 2009, as there was a decline in the cost of administration and sales and promotion categories for the year. Total profits before interest and taxes (PBIT) were $272 million, a drop of about 3% in the PBIT margin since 2008.

Much of the revenue was generated by FM radio stations ($1.2 billion of the total), 23 of which were new in 2009. French-language radio stations saw a slight increase in profits to $227 million, while the English-language radio stations’ revenue dropped by 5.8% to $1.2 billion, as did ethnic FM radio stations’ revenues, which fell by 3.3% to $16 million.

There were seven fewer AM radio stations in 2009, with the remaining 149 AM radio stations generating just over $300 million in revenues – a 7.4% decrease from the previous year. Corus Quebec closed two AM radio stations this past February due to falling audience shares, according to Corus Quebec VP Mario Cecchini, who stressed there was an entire generation of Canadians that has never been on the AM dial.

Both English- and French-language AM stations’ revenues fell by about 8% (to $272 million and $11.6 million, respectively) while Canada’s 11 ethnic AM stations experienced a slight increase in revenues to about $22 million.