OTTAWA – The economic downturn in 2009 pulled down the profitability of the commercial radio industry in Canada two years in a row, the first time since 1993 that revenue has fallen from one year to the next, according to data from Statistics Canada released Tuesday.
Private radio broadcasters’ operating revenue declined 5.2% compared with 2008 to $1.5 billion (current dollars) in 2009, while advertising revenues dropped 5.5%. Private radio broadcasters earned 17.9 cents of profits before interest and taxes per dollar of revenue in 2009, the worst performance since 2002. These results contrast with the industry’s steady increase in profitability over the previous 10 years.
Radio broadcasters’ performance varied from region to region. On an annual basis, operating revenue increased in Saskatchewan (+6.7%) and Quebec (+1.1%) but declined in all other regions. Ontario radio broadcasters’ were the most profitable in 2009, with 21.7 cents of profits before interest and taxes per dollar of revenue. Alberta radio broadcasters, who had posted the best profitability in recent years, registered the worst result for that province since 1998, with profits before interest and taxes of 19.5 cents per dollar of revenue.
Francophone radio stations in 2009 posted increased operating revenue (+1.7%), compared with declines for Anglophone (-6.6%) and ethnic stations (-1.1%). This was a reversal from the three previous years, when Anglophone stations posted strong annual growth in their operating revenue.
