GMA Network gains big from the shutdown of its archrival ABS-CBN.
For the full year 2020, the network reported a net profit of 6 billion pesos, up by 128% from the previous year.
Based on its financial disclosure, the Kapuso network’s consolidated revenue surged by 17% to 19.33 billion pesos as a result of its rival ABS-CBN’s free TV shutdown.
“GMA Network Inc. and subsidiaries broke all records in terms of financial performance for the 12-month period,” GMA Network said.
The network also added that its biggest rival’s closure has “contributed to the extraordinary increase in sales from broadcast operations due to the shift in some advertising placements.”
ABS-CBN was forced to go off-air on free TV in May 2020 following the expiration of its franchise and the subsequent denial of its franchise renewal application by the 70 Cayetano-led congressmen.
With the shutdown, ad placements previously held by the Kapamilya network were transferred to the GMA Network.
In fact, 92 percent of the 19.33 billion earnings came from ad revenues which translates to an increase of 17% year over year at 17.73 billion pesos.
Aside from the boost in ad revenue, the network also slashed 16% or 10.78 billion pesos from its operating expense which contributed to their profit gains. The decrease in operating expenses is brought about by the drop in production costs as the effect of the government’s pandemic restrictions.
Meanwhile, another contributor to their revenue increase is their sale of services which reached P1.02 billion in 2020.
