An asset write-down related to the government’s decision to bring forward the switch from analogue to digital TV to 2012 has caused Kordia to post an $18 million loss for the six-months to December.
However, with the write-down taken out of the equation, Kordia made an operating profit of $1.4 million for the period.
In a statement announcing the results, Kordia notes: “the Kordia Group Board is, as a result of the impact of digital switchover being brought forward, recording an impairment entry of $29.0 million (before tax), covering the write-down of assets associated with analogue television transmission, and an increase in the make-good provision relating to sites on which the transmission equipment is located.
“This entry, a non-cash adjustment, reduces the underlying net profit after tax from a profit of $1.4 million to a loss of $18 million.”
In the statement, Kordia CEO Geoff Hunt says Kordia Networks is “seeing real growth” and that Orcon is “trading ahead of budget in both revenue and profit” and the Kordia Solutions “is now trading on budget”.
In Australia, Kordia Solutions “delivered a strong result”, Hunt says.
Kordia has been in the process of reinventing itself as a provider of network and internet services since the decision to move away analogue television, formerly a major source of revenue in the days when it was known as BCL, was made. Kordia owns substantial assets and infrastructure related to analogue transmission.
BCL was rebranded as Kordia in 2006 and describes its transformation as “broadcast to broadband.”
As part of the shift in its business, Kordia acquired Orcon in 2007 for $24.3 million. It is now looking at building a trans-Tasman telecommunications cable in a project called Optikor.