Today, Dec. 8, a good friend, Felipe “Henry” L. Gozon celebrates his 78th birth anniversary.
Henry’s has been a fulfilling life. He is today the best and most accomplished broadcast CEO in Asia. He parlayed a money-losing (for 12 straight years) second-rate ramshackle television station in Manila, RBS 7, into the biggest (in audience share and ratings), most credible, most respected, most influential, and yes, most profitable, broadcast network in the Philippines.
GMA Network had its best year in 2016. Profits hit a record P3.646 billion, up 71.5 percent, on revenues of P16.697 billion, up 21.5 percent.
2017 is another good year with profits likely to exceed P2.6 billion.
In 16 years of savvy management and visioning, the man with cherubic looks delivered P27.95 billion in cumulative profits on revenues of P167.33 billion. Thrilling, considering that the now renamed GMA Network, Inc. started, in the years before that, with zero profits and scarce resources in equipment, manpower, and influence.
Gozon has plans to go digital plus a convergence with cellular phone service. That will enable GMA Network to leapfrog over the competition and reaffirm its claim that indeed, it is the No. 1 TV network.
In 2016, per its own data, GMA remained the No. 1 television network, both in household ratings, 15.3 percent, and audience share, 43.2 percent. ABS CBN had 10 percent household ratings and 28.3 percent audience share. ABS CBN is the Philippines’ first TV network to be established.
GMA makes more money per P100 of revenue—P21.80. That is 2.6x ABS CBN’s P8.40 for every P100. The latter’s profit to sales ratio of 8.4 percent is supposed to be an improvement; in 2015 and 2014, profit ratio was just 6 percent. GMA has EBITDA of P6.77 billion, up 45 percent over 2015 P4.679 billion, which was up 60 percent over 2014.
At end-2016, ABS CBN showed EBITDA of P9.853 billion, up 24 percent from 2015’s P7.94 billion which was up just 6.2 percent over 2014.
GMA has no long-term debts. ABS CBN has P20.11-billion long-term debts.
Gozon has a master of laws at Yale and was a topnotch aviation and telco lawyer before focusing on television.
With the P27.65 billion in profits, Gozon delivered for the past 16 years, the troika that owns GMA has collected prodigious paybacks. Gilberto Duavit owns 28.5 percent of GMA Network, Nards Jimenez 27 percent, and Henry Gozon 25.6 percent. So the profits collected by the three families in 16 years: Duavit P7.965 billion; Jimenez P7.546.5 billion; and Gozon, P7.155.2 billion.
In the last five years, from 2012 to 2016, GMA Network revenues swelled from P11.83 billion to P16.67 billion, a record. The increase in five years was 40 percent, equivalent to 8.2 percent annual gain. Profits rose, from P1.6 billion in 2012 to P3.64 billion, a record, and an increase of 125 percent, or an average jump in profitability of 25 percent per year.
In finances, GMA leads both competitors, ABS-CBN and TV 5, in most key financial indicators, from gross profit margins, net income margins, to debt-equity ratios, with GMA debt free for the past couple of years.
GMA says it enriches the lives of Filipinos everywhere with superior entertainment and the responsible delivery of news and information.
2016 was a singularly good year for TV because of the local and presidential elections. For GMA, election spending added P1.5 billion in advertising, while non-election spending also went up, by P2 billion.
This combination increased revenues 21 percent year-on-year, making 2016 GMA Network’s best year in revenues and profits, and remaining the most profitable network. “The resurgence of the Network as the leader in terms of nationwide TV ratings buoyed revenues from regular advertising placements,” says the company. This performance increased EBITDA by a whopping 42 percent to P6.778 billion, a record.
GMA Network has proven its competitiveness by grabbing the No. 1 spot in nationwide TV ratings since early 2010, posting its biggest lead over competition in 2011 and maintaining the lead in 2012.
For the 2016 elections, per data from Effective Measure for worldwide audience for the period May 9 to 11, GMA News Online recorded 109,802,626 page views—the highest number of page views for three consecutive days, a feat never before achieved by any local site to date.