Hong Kong’s dominant broadcaster, TVB, saw its losses widen dramatically last year as advertising revenue plunged amid the protests that battered the city’s economy.
The free-to-air broadcaster posted a net loss of HK$295 million (US$38 million) for 2019, compared with HK$199 million the previous year, and said worse is to come as the coronavirus pandemic brings further misery.
“With unrest continuing, the market is still far from returning to normality. The recent outbreak of the coronavirus further curtailed economic recovery and is bringing a slowdown on a global scale,” said the free-to-air broadcaster in the a filing on Wednesday night to the Hong Kong stock exchange.
“Our business took a sharp turn during the second half of the year as we are heavily reliant on advertising which weakened along with the broader economy.”
Television Broadcasts (TVB), whose parent is the film production company Shaw Brothers, said its advertising income plunged 22 per cent to HK$1.9 billion in 2019, mainly because of a sharp decline in the second half when the city was gripped by social unrest.
Revenue dropped 18 per cent year-on-year to HK$3.6 billion.
As a result of the dire situation, TVB announced staff cuts in December. The lay-offs affected about 350 employees from field production and supportive services, about 10 per cent of the workforce.
The Covid-19 pandemic has taken the lives of more than 19,000 people across the world and is devastating the economies of many major economies.
“Our businesses in 2020 will be highly challenging due to the impact of a likely prolonged economic downturn caused by the coronavirus pandemic, and the as yet unsettled local social unrest,” said Li Ruigang, vice-chairman of the company in its filing.
Hong Kong’s economy is mired in its first recession in a decade, weighed down by a combination of the year-long US-China trade war, a consumption slump brought on by many months of anti-government protests, and now, the coronavirus outbreak.
The city’s output is projected to shrink 7.5 per cent in the second quarter, putting it on track for a 4.8 per cent decline this year, according to Standard Chartered Global Research.
The TVB board has suggested paying shareholders a final dividend of HK$0.2 per share, taking annual dividends to HK$0.5 per share for 2019, half that delivered in 2018.
More from South China Morning Post:
- Soho China sees coronavirus weighing on revenue after office occupancy, rents fall amid slowing economy
- Hong Kong stocks are at their cheapest relative to mainland Chinese equities in two years as Citic Securities predicts 20 per cent gain
- Guest of SG Group’s March 20 share listing ceremony at the Hong Kong stock exchange tests positive for the coronavirus
- Coronavirus: US firms in China struggling with plunging demand, travel disruptions as pandemic fallout continues