GMA Network Inc. on Wednesday said it is unlikely to meet its net income target this year because of the cut back on advertising expenditures of multinational companies.
“We may not be able to meet the P3-billion net income target this year,” Felipe Gozon, GMA chairman and chief executive told reporters on the sidelines of the 37th Philippine Business Conference.
Gozon blamed the anticipated drop in earnings on the reduction in advertising expenditure of firms such as Unilever, Procter and Gamble, Nestlé, Pfizer and Johnson & Johnson.
He said the ad cutback stemmed from the crises in the US and Europe, which so far has resulted in the company missing its P1-billion ad sales target for September.
Revenues in July and August however were “good,” he said.
“We are hoping to recover this October and November,” he added.
GMA’s profit dropped by 37.5 percent to P521 million in the second quarter of the year, from P834
million in the same three-month period last year.
This brought its first-half net income to P1.05 billion, or 38 percent lower than last year’s P1.69 billion.
Revenues in the second quarter amounted to P3.59 billion, also down by 8.6 percent from P3.93 billion last year.
GMA shares climbed to P6.55 each on Wednesday from P6.51 on Tuesday.