Seven Faces $1.9 Billion worth of Loss

Australia based commercial broadcaster Seven Media Group has reduced the value of its television network by $1.5 billion putting the company into a total loss of $1.9 billion in annual accounts which was published on Monday. The alliance of Seven Netwrok and private equity firm KKR dropped to a negative equity of $1.7 billion due to Seven Network’s (SEV) liabilities which outstripped its assets by as much as $1.7 billion. PBL Media posted a $913 million worth of loss yesterday following an $851 million write-down of the company’s television and ACP magazines businesses. According to the Seven accounts, the company had $34.5 billion worth of loans and paid $416 million interest where PBL Media had $4.2 billion loan and made payment of $389 million interest.

Seven Network wrote down its interest in the industry from $794 million to nothing on last February which has signified the drop in the value of the assets of the Group. It is to be mentioned that Seven Network is the listed owner that holds 47 percent of Seven media Group ownership. The negative equity of the Group is indicating that the $3 billion worth of asset sales is not going to cover its $4.7 billion liabilities. However, the Seven authority claimed that the group has enough financial capability to refinance the loans in order to meet the obligations.

The Group earned $1.5 billion worth of revenue and remained within the financial and non-financial loan agreements. Seven claimed that the loan facilities of the company helped it to enjoy an equity cure through some of the asset sell. The company also added that the $1.4 billion worth of liabilities which is owed to the subordinated noteholders has matured in five years and only then if there was any asset or cash that was to be redeemed. Ignoring these, the negative equity would be $196 million.