Canadian broadcasters supercharged their profits by cutting programming costs last year, making 2011 the best 12 months for private television operators since 2005.
Revenues for conventional TV stations rose slightly, from $2.147-billion in 2010 to $2.153-billion last year, but a 7.2 per cent cut in expenses sent profits before interest and taxes (PBIT) up almost 1,300 per cent, from $11.5-million to $160.6-million, marking their highest level in six years.
The figures were released Wednesday by the Canadian Radio-television and Telecommunications Commission in its annual statistical and financial information report, for the broadcast year ended Aug. 31, 2011.
Cable and satellite companies remain hugely profitable operations, with revenues up 8 per cent, to $13.5-billion, according to a separate report issued Wednesday by the CRTC. Cable companies accounted for $10.1-billion in revenues, up 8.2 per cent, though the industry’s PBIT margin dropped slightly from 25.3 per cent to 23.1 per cent. Satellite and multipoint distribution system companies saw revenues increase 5.8 per cent, to $2.5-billion, with a PBIT margin of 6.9 per cent.
Known as broadcast distribution operations, the cable and satellite companies contributed $488.9-million, or 6.5 per cent of the revenues collected from subscribers in 2011, to the creation of Canadian programming. That figure includes $106.6-million to the Local Programming Improvement Fund, a pool created in 2008 to support the creation of local programs by conventional TV stations outside of the country’s metropolitan areas. Later this month, the CRTC will initiate a public consultation on whether the fund, which has come under fire from some in the industry, should be altered or cancelled entirely.
The CRTC’s two reports made plain how much the domestic television production industry depends on the CBC, which outlined in a separate announcement on Wednesday how it would carry out some of the cuts it learned about in last week’s federal budget.
The CBC’s English- and French-language conventional TV stations spent $713-million on Canadian programming in 2011, while the private conventional broadcasters spent a combined total of $562.9-million. Those figures do not include expenditures for programming on specialty, pay, and pay-per-view programming. The CRTC will issued statistical and financial updates for those services, as well as radio, in the coming months.