ASAHI BROADCASTING GROUP HOLDINGS (9405) FY2027 Q1

Quick View

Executive Summary

The combination of lower revenue from the Broadcasting and Content Business and a higher SG&A ratio caused both operating income and net income to fall from the previous year's profits into losses. Revenue was ¥20.08B (¥21.70B in the previous year, YoY -7.5%), Operating Income was ¥-0.35B (previous year: +¥0.25B), and Ordinary Income was ¥-0.19B (previous year: +¥0.35B). Consolidated Net Income was ¥-0.12B (previous year: +¥1.88B, YoY -106.3%), of which Net Income Attributable to Owners of the Parent was ¥-0.13B (previous year: +¥1.87B). The primary factors were an 8.8% decline in revenue from the Broadcasting and Content Business, an increase in the SG&A ratio from 30.3% in the previous year to 32.8%, indicating limited cost flexibility, and the absence of the one-time gain on the sale of property, plant and equipment of ¥2.44B recorded in the previous year.

Factors Affecting Performance

【Revenue】Revenue was ¥20.08B, representing a 7.5% year-on-year decline. By segment, the Broadcasting and Content Business was ¥16.75B (83.4% of total revenue, YoY -8.8%), making it both the core business and the main source of the decline, while the Lifestyle Business was ¥3.50B (17.4% of total revenue, YoY -0.3%), remaining essentially flat. Weakness in advertising revenue and program-related revenue in the Broadcasting and Content Business drove the overall revenue decline.

【Profit and Loss】Operating Income fell into negative territory at ¥-0.35B (previous year: +¥0.25B). While the gross profit margin declined by approximately 0.4pt to 31.1% from 31.5% in the previous year, the SG&A ratio increased by approximately 2.5pt to 32.8% from 30.3%. Limited cost flexibility relative to the revenue decline resulted in negative operating leverage. Ordinary Income was ¥-0.19B (previous year: +¥0.35B). Although non-operating income of ¥0.23B, including dividend income of ¥0.13B and other items of a recurring nature, provided support, it was insufficient to offset the operating loss. Extraordinary income consisted solely of a ¥0.06B gain on the sale of investment securities. The absence of the one-time ¥2.44B gain on the sale of property, plant and equipment recorded in the previous year directly led to the substantial deterioration in net income, with consolidated Net Income at ¥-0.12B (previous year: +¥1.88B). The results were characterized by both lower revenue and lower profit, with a structural decline in earnings power evident from the operating level.

Segment Analysis

The Broadcasting and Content Business generated revenue of ¥16.75B (YoY -8.8%) and reported an operating loss of ¥-0.37B (previous-year Operating Income: +¥0.185B, YoY -298.4%), falling from a profit into a loss, with a margin of -2.2%. This business is the core operation, accounting for more than 80% of consolidated revenue, and its deteriorating results drove the Company-wide performance. The Lifestyle Business maintained revenue of ¥3.50B (YoY -0.3%), essentially in line with the previous year, but Operating Income declined to ¥0.03B (previous year: ¥0.071B, YoY -63.4%), leaving a margin of only 0.7%. Both segments recorded lower profit, while the Broadcasting and Content Business's swing into a loss largely explains the deterioration in consolidated Operating Income, from +¥0.25B in the previous year to ¥-0.35B.

Key Financial Metrics

【Profitability】The Operating Income margin deteriorated by approximately 2.9pt to -1.7% from +1.2% in the previous year, while the consolidated Net Income margin also declined substantially to -0.6% from +8.7%. The previous year's high Net Income margin was supported by the one-time gain on the sale of property, plant and equipment. This period saw a substantial decline in profitability due to the resulting reversal effect combined with the operating loss.【Cash Flow Quality】Cash and deposits were ¥16.88B, down 22.9% from ¥21.88B in the previous year, while accounts receivable also decreased by 16.1% to ¥13.91B from ¥16.58B. The operating loss and decline in cash on hand are progressing simultaneously, making improvement in cash-generation capacity through earnings recovery a key focus going forward.【Investment Efficiency】ROE declined to -0.1% (approximately +2.2% in the previous-year period based on consolidated Net Income), indicating lower capital efficiency, with the operating loss directly weighing on returns on equity.【Financial Soundness】The Equity Ratio improved to 65.5% from 62.6% in the previous year. Current assets of ¥48.40B versus current liabilities of ¥16.69B imply a current ratio of approximately 290%. Interest-bearing debt, including both current and non-current portions, was approximately ¥18.6B and continued to trend downward, reflecting a conservative capital structure.

Cash Flow Analysis

As no statement of cash flows has been disclosed, fund movements can be assessed based on changes in the balance sheet. Cash and deposits declined by ¥5.09B, or 22.9%, to ¥16.88B from ¥21.88B in the previous year. The primary factors behind the decline were the payment of the prior fiscal year's tax burden, as income taxes payable fell substantially from ¥2.35B to ¥0.08B, and the execution of share repurchases, as treasury stock increased from ¥0.02B to ¥0.17B. Meanwhile, accounts receivable declined by 16.1% to ¥13.91B from ¥16.58B in the previous year, indicating progress in reducing operating receivables in response to lower revenue. Long-term borrowings, including the current portion, also continued to trend downward, suggesting that funds were allocated to tax payments, shareholder returns, and debt repayment. With current assets of ¥48.40B against current liabilities of ¥16.69B, the current ratio remained around 290%, and the level of on-hand liquidity itself remained ample.

Earnings Quality

Examining the recurring earnings structure, the operating result was a loss of ¥-0.35B due to deterioration in the core business. Non-operating income of ¥0.23B, including dividend income of ¥0.13B and interest income and other items, contributed to supporting Ordinary Income as a recurring source of revenue, but could not prevent the shift into a loss. Extraordinary income consisted solely of a small ¥0.06B gain on the sale of investment securities. Since the large one-time factor of the ¥2.44B gain on the sale of property, plant and equipment recorded in the previous-year period was absent this period, the year-on-year deterioration in Net Income of -106.3% was amplified by the disappearance of the one-time factor in addition to the deterioration in recurring earnings power. Comprehensive Income was ¥-0.62B, showing a greater deterioration than consolidated Net Income of ¥-0.12B. The deterioration in OCI items, including valuation differences on available-for-sale securities of ¥-0.20B and adjustments related to retirement benefits of ¥-0.29B, created the divergence between Net Income and Comprehensive Income. These effects reflect valuation gains and losses associated with market fluctuations and should be distinguished from operating results themselves.

Earnings Forecast and Guidance

The Full-Year forecast is Revenue of ¥92.30B (YoY -3.9%), Operating Income of ¥4.00B (YoY -16.0%), Ordinary Income of ¥4.10B (YoY -7.2%), EPS of ¥64.83, and DPS of ¥20.00. No revision to the forecast was made during the quarter. As of Q1, the Revenue progress rate was 21.8% (¥20.08B/¥92.30B), broadly within the range of historical quarterly pacing. However, Operating Income was negative at the quarterly stage (¥-0.35B), indicating significantly delayed progress toward the full-year plan for a profit of ¥4.00B. Ordinary Income was also negative for the quarter. Achieving the full-year plan therefore assumes a recovery in advertising demand from Q2 onward, additional revenue from programming changes and events, and flexible cost management.

Shareholder Returns

The dividend forecast is ¥20.00 per share, implying a Payout Ratio of approximately 30.9% (¥20/¥64.83) based on forecast EPS of ¥64.83. This indicates an intention to maintain the dividend based on the assumption of a profitable full-year result. Treasury stock increased from ¥0.02B to ¥0.17B, suggesting that share repurchases were conducted. The Payout Ratio based solely on dividends is approximately 30.9%, while the Total Return Ratio including share repurchases cannot be calculated from the disclosed data. Cash and deposits of ¥16.88B and an Equity Ratio of 65.5% indicate a certain degree of financial capacity for distributions. However, given that the Company reported an operating loss in the quarter, full-year earnings progress and cash-on-hand trends remain items requiring continued monitoring.

Risk Factors

1. Advertising Market Volatility Risk: Revenue from the Broadcasting and Content Business declined to ¥16.75B (YoY -8.8%), while its operating result fell from +¥0.185B in the previous year to ¥-0.367B. Since this business accounts for more than 80% of consolidated revenue, changes in advertising revenue have a significant impact on consolidated performance.

2. Fixed-Cost Burden and Operating Leverage Risk: The SG&A ratio rose from 30.3% in the previous year to 32.8%, and costs did not contract sufficiently in response to the 7.5% decline in Revenue. The Operating Income margin deteriorated by approximately 2.9pt from +1.2% in the previous year to -1.7%. Cost flexibility during periods of declining revenue remains a challenge.

3. Volatility Risk in Other Comprehensive Income and Long-Term Debt-Related Items: Comprehensive Income was ¥-0.62B, showing a greater deterioration than Net Income of ¥-0.12B, due to valuation differences on securities of ¥-0.20B and adjustments related to retirement benefits of ¥-0.29B. Long-term debt-related items, including retirement benefit liabilities of ¥5.71B, require attention as potential sources of future cash outflows and changes in net assets.

Industry Benchmark (For Reference; Company Analysis)

Profitability and Returns

Both the Company's Operating Income margin and Net Income margin are substantially below the industry median and below the lower bound of the IQR.

Growth and Capital Efficiency

The Revenue growth rate is also substantially below the industry median, positioning the Company among firms in the IT and communications industry experiencing a decline in revenue.

Source: Company calculations

Key Points from the Earnings Results

1. Operating Income fell from +¥0.25B in the previous-year period to a loss of ¥-0.35B, and quarterly progress toward the full-year plan of ¥4.00B is significantly delayed. The degree of recovery in subsequent quarters will be a key factor in assessing achievement of the full-year target.

2. The substantial year-on-year deterioration in Net Income of -106.3% was significantly affected by the disappearance of the one-time ¥2.44B gain on the sale of property, plant and equipment recorded in the previous-year period. This must be considered separately from the deterioration in the Company's recurring earnings power.

3. Financial soundness remains strong, with an Equity Ratio of 65.5% (improved from 62.6% in the previous year) and a current ratio of approximately 290%. Despite the operating loss for the period, the Company's financial foundation retains capacity.

Theoretical Share Price (Reference Value)

This is a reference range mechanically calculated solely from publicly disclosed data using a residual income model (Ohlson-type model with an explicit five-year fade). It is not a forecast of the market share price or a recommendation of any specific investment action.

Sensitivity: ¥1,596–¥1,688 at ±1% for the cost of equity, and ¥1,630–¥1,648 at ±0.1 for ω.

Notes:

• Because forecast ROE is below the cost of equity, the theoretical value is below book value per share.
• Net assets as of the end of the quarter are used (there is a timing difference relative to the Full-Year forecast).
• Because net assets include non-controlling interests, the theoretical value may be calculated somewhat higher.

(Calculation model: Residual Income Model / Interest-rate reference month: 2026-07 / This value does not forecast or guarantee the future share price)

---

This report is an earnings analysis document automatically generated by AI based on XBRL earnings summary data. It does not recommend investment in any specific security. The industry benchmarks are reference information compiled by the Company based on publicly disclosed earnings data. Investment decisions should be made at your own responsibility, after consulting professionals as necessary.

---End of Report---

---

AI Financial Analysis

Executive Summary

FY2027 Q1 was a weak start, with a revenue decline and a swing to operating and net losses, although the balance sheet remains conservatively capitalized. Revenue fell 7.5% year on year to ¥20.08bn. Gross profit declined 8.6% to ¥6.24bn. The gross margin nevertheless improved by 40bp to 31.1% from 31.5%? Actually the reported figures imply a decline versus the prior-period gross margin of 31.5%, so the margin compressed by approximately 40bp. SG&A was effectively flat at ¥6.59bn, down only ¥0.01bn year on year, and therefore did not flex with lower sales. Operating income consequently deteriorated from a ¥0.25bn profit to a ¥3.46bn loss. The operating margin declined by 290bp, from 1.2% to -1.7%. Ordinary income was a ¥1.95bn loss, partially supported by ¥1.34bn of dividend income and ¥0.26bn of interest income. Net income attributable to owners was a ¥1.30bn loss, compared with prior-year profit of ¥18.72bn. The year-on-year net-income comparison is substantially affected by the prior-year ¥24.35bn gain on disposal of fixed assets, while the current quarter included only a ¥0.59bn gain on sales of securities. Thus, underlying operating deterioration is material, but the headline net-income decline is also amplified by the absence of the prior-year exceptional gain. Comprehensive income was a ¥6.22bn loss, exceeding the net loss because other comprehensive income was negative. The Broadcasting and Content business, the core business by segment operating-income contribution, was the principal source of the deterioration, posting a ¥3.67bn segment loss. Lifestyle remained profitable but its earnings contribution fell sharply. Liquidity is strong, with a 290.0% current ratio and ¥16.89bn of cash and deposits. Borrowing leverage is low relative to equity, though the operating loss renders the current-period interest-coverage metric negative. Management maintained full-year guidance, which calls for a substantial recovery from the Q1 loss. Q1 revenue represents 21.8% of the ¥92.30bn full-year forecast, below the standard 25% pace, while the operating-loss start means delivery depends on a meaningful recovery in the remaining quarters. The central issue for the outlook is whether broadcasting/content revenue can recover sufficiently to restore operating leverage while preserving the company’s sound capital base.

Profitability Analysis

Annualized DuPont analysis shows ROE of -0.6%, composed of a -0.7% net profit margin, 0.638x asset turnover, and 1.53x financial leverage. The negative net margin is the binding driver of negative ROE, rather than excessive leverage. Annualized asset turnover of 0.638x indicates that the large asset base is generating relatively modest sales productivity, while leverage remains moderate. The operating result was the decisive deterioration: revenue fell ¥1.62bn year on year, gross profit fell ¥0.59bn, and essentially unchanged SG&A prevented cost absorption. Gross margin declined to 31.1% from approximately 31.5%, a 40bp compression, indicating that the revenue shortfall was not offset by better gross-profit economics. More importantly, SG&A fell only ¥0.01bn versus the ¥1.62bn revenue decline, demonstrating adverse operating leverage. EBIT margin was -1.7%, below the 5% concern threshold, and annualized ROIC was -1.8%, also below the 5% benchmark. The quality alerts for low operating efficiency and weak capital efficiency are therefore rooted in the core operating loss rather than balance-sheet leverage. The 0.393 interest burden is mathematically weak because EBIT was negative; it should not be interpreted as 61% of a positive operating profit being consumed by interest. Interest expense itself was modest at ¥0.25bn, but a loss-making EBIT cannot cover it during the quarter. Non-operating income of ¥2.30bn exceeded non-operating expense of ¥0.80bn, with dividend income of ¥1.34bn providing important support to ordinary income. This reliance on investment income highlights that operating profitability, rather than financial income, must improve for a durable earnings recovery. Under JGAAP, goodwill is only ¥3.69bn, or 0.4% of equity, so goodwill amortization or impairment exposure does not appear to be a material driver of the current profitability weakness.

Growth Assessment

Revenue contraction was concentrated in the Broadcasting and Content segment, where external sales fell 8.8% year on year to ¥16.63bn. This segment’s operating result swung from a ¥1.85bn profit to a ¥3.67bn loss, making it the clear source of consolidated weakness. Its segment margin fell from 1.0% to -22.1%, reflecting severe negative operating leverage on the sales decline. Lifestyle revenue was comparatively resilient, down 0.4% to ¥3.45bn. However, Lifestyle segment profit fell 63.4% to ¥0.26bn and its margin declined from 2.0% to 0.8%, showing that it did not fully offset the core-business pressure. Consolidated sales progress was 21.8% against the full-year revenue forecast of ¥92.30bn, 3.2 percentage points below the standard 25% Q1 pace. Operating-income progress is negative against the ¥4.00bn full-year target, versus a standard 25% pace, because Q1 recorded a ¥3.46bn loss. Net income attributable to owners is likewise negative against the ¥2.70bn forecast. The maintained forecast implies that the company expects earnings to be weighted materially toward the remaining three quarters. The full-year plan itself assumes revenue declines 3.9% and operating income declines 16.0% year on year, so it does not require a return to growth relative to the prior full year; however, it does require a decisive sequential recovery from the Q1 operating loss. The ¥0.59bn current gain on sales of securities is non-recurring and should not be treated as support for recurring profit. Conversely, the prior-year Q1 included a much larger ¥24.35bn fixed-asset disposal gain, which materially distorts the year-on-year comparison in net income. Sustainable improvement depends chiefly on stabilization of Broadcasting and Content revenue and better fixed-cost absorption.

Financial Health

Financial health is strong from a liquidity and equity-capital perspective. Current assets of ¥48.40bn exceeded current liabilities of ¥16.69bn by ¥31.71bn, producing a 290.0% current ratio and a 278.9% quick ratio. Cash and deposits were ¥16.89bn, while receivables were ¥13.91bn and inventories were limited at ¥1.85bn. The short-term debt ratio was only 2.7%, and cash covered reported short-term loans by 337.7x. Total equity was ¥82.44bn, equal to 65.5% of total assets, providing a substantial loss-absorption buffer. Total liabilities were 34.5% of assets. Reported debt-to-equity was 0.53x and debt/capital was 2.2%, both indicating modest reported financial leverage. In addition to loans of ¥1.86bn, the balance sheet includes ¥10.00bn of bonds payable; including these bonds, gross borrowings are approximately ¥11.86bn, or about 14.4% of equity, which remains conservative. The current portion of long-term loans was ¥0.81bn and is readily covered by cash and working capital, limiting refinancing and maturity-mismatch risk. The ¥5.71bn net defined-benefit liability is a meaningful long-term obligation, equivalent to 6.9% of total equity, but it is manageable within the current capital structure. The negative interest-coverage alert is a direct consequence of negative EBIT of ¥3.46bn versus ¥0.25bn of interest expense. Its impact is that sustained operating losses would reduce debt-service resilience, although the low absolute interest cost, cash holdings, and low borrowing burden currently mitigate near-term solvency risk. Treasury stock increased by ¥1.46bn year on year to ¥1.70bn, consistent with capital being deployed toward treasury-share acquisition or reclassification; this modestly reduces equity but is not material relative to the ¥82.44bn equity base.

Notable B/S Changes

Total assets: -¥85.80bn (-6.4%) year on year — primarily reflects lower current assets, reducing the liquidity cushion in absolute terms while remaining ample. Cash and deposits: -¥50.94bn (-23.2%) year on year — cash remains substantial at ¥16.89bn but should be monitored alongside recovery in operating earnings. Accounts receivable: -¥26.67bn (-16.1%) year on year — lower receivables reduced current assets, though annualized DSO remains elevated at 63 days. Accounts payable and other: -¥21.68bn (-22.2%) year on year — a lower payables balance contributed to the decline in current liabilities and reduced short-term operating funding. Income taxes payable: -¥22.63bn (-96.5%) year on year — reflects the absence of the prior-period exceptional gain and related tax obligation. Current portion of long-term loans: -¥10.22bn (-56.0%) year on year — reduces near-term debt maturities and maturity-mismatch risk. Treasury stock: -¥1.46bn (-608.3%) year on year — indicates increased treasury-share holdings, modestly reducing equity but remaining immaterial against the equity base. Total equity: -¥18.24bn (-2.2%) year on year — the decline reflects lower retained earnings and negative comprehensive income, partly offset by the still-strong capital base.

Cash Flow Quality

The quarterly loss limits assessment of cash generation from earnings. Operating performance generated a ¥1.30bn net loss attributable to owners, and no recurring operating profit was available to support cash conversion. The earnings-quality focus is therefore on the distinction between the core operating loss and investment or disposal-related items. Dividend income of ¥1.34bn supported ordinary income but is not a substitute for profitable broadcasting and content operations. The ¥0.59bn gain on sales of securities is non-recurring. The prior-year net income also benefited from a ¥24.35bn gain on sale of fixed assets, making the prior-year reported earnings materially less representative of recurring cash-generating capacity. Receivables were ¥13.91bn, equivalent to 63 days of sales outstanding on an annualized basis, exceeding the 60-day alert threshold. The high-receivable-days alert indicates that collections and advertising/customer payment timing should be monitored, as slower collections could absorb liquidity even though current liquidity remains ample. Inventories represented only 1.5% of total assets, limiting inventory obsolescence and inventory-related working-capital risk. Cash and deposits decreased ¥5.09bn year on year, while current liabilities declined ¥6.68bn, including lower payables and income taxes payable; this balance-sheet movement is consistent with a lower short-term funding base alongside lower liquid assets. The strong ¥31.71bn working-capital surplus provides a buffer against normal working-capital volatility. The core requirement for improved earnings quality is a return to positive operating income rather than reliance on dividends and sporadic disposal gains.

Dividend Sustainability

The full-year dividend forecast is ¥20.00 per share, unchanged from the disclosed forecast. Against forecast EPS of ¥64.83, the implied dividend payout ratio is approximately 30.8%, below the 60% sustainability benchmark. Based on 41.83 million issued shares, the implied annual cash dividend is approximately ¥0.84bn. This level is modest relative to total equity of ¥82.44bn and retained earnings of ¥586.95bn. However, Q1 EPS was negative ¥3.13 and earnings attributable to owners were a ¥1.30bn loss, so near-term dividend support depends on the expected recovery during the remainder of the fiscal year and on the existing balance-sheet capacity. The maintained dividend forecast signals that management does not currently expect the Q1 loss to alter its shareholder-return policy. Treasury stock rose ¥1.46bn year on year, but the available data does not establish the timing or authorization of a current-period repurchase; accordingly, the dividend-only payout ratio remains the relevant disclosed return metric. Dividend sustainability is supported by low leverage, high liquidity, and substantial retained earnings, while the principal operating risk is failure to achieve the earnings recovery embedded in the full-year plan.

Risk Assessment

Business risks include High priority — Broadcasting and Content, the core business, saw revenue decline 8.8% to ¥16.63bn and segment profit swing from ¥1.85bn to a ¥3.67bn loss. Continued weakness in advertising, programming/content monetization, or audience-related revenue would materially impair full-year recovery., High priority — Fixed-cost operating leverage is elevated: consolidated revenue fell ¥1.62bn while SG&A was almost unchanged, causing operating margin to fall 290bp to -1.7%., Medium priority — Lifestyle remained profitable, but segment profit fell 63.4% to ¥0.26bn despite only a 0.4% revenue decline, indicating margin sensitivity and limited offset capacity., Medium priority — Media-sector demand is exposed to advertising-market cyclicality and ongoing competition from digital platforms, which can pressure traditional broadcasting revenue and content economics..

Financial risks include Medium priority — Interest coverage was -13.84x because EBIT was negative. The root cause is the operating loss, not high absolute interest expense; the impact would rise if losses persist, although ¥16.89bn cash and modest borrowings mitigate immediate debt-service pressure., Medium priority — Receivable days were 63 days, above the 60-day alert level. This may slow cash conversion and warrants monitoring of collections and customer credit quality., Low priority — The ¥5.71bn net defined-benefit liability is a material long-term obligation, though it remains manageable relative to ¥82.44bn of equity., Low priority — Comprehensive income was a ¥6.22bn loss, larger than the net loss, reflecting negative other comprehensive income and exposing equity to market-value fluctuations in securities holdings..

Key concerns include The full-year operating-income target of ¥4.00bn requires a substantial turnaround after the ¥3.46bn Q1 operating loss., Recurring operating profit is currently insufficient; ordinary income was supported by ¥1.34bn of dividend income and profit before tax included a ¥0.59bn securities-sale gain., The prior-year comparison was flattered by a ¥24.35bn fixed-asset disposal gain, so reported year-on-year net-income volatility should not be extrapolated as a pure change in recurring performance., Capital efficiency is weak, with annualized ROE of -0.6% and annualized ROIC of -1.8%, both driven by operating losses on a sizable asset base..

Investment Implications

Key takeaways include Q1 operating performance weakened materially, led by the Broadcasting and Content segment., The company retains substantial balance-sheet resilience: 65.5% equity/assets, a 290.0% current ratio, and ¥16.89bn cash and deposits., The maintained full-year forecast implies a strong back-half recovery, making revenue stabilization and margin normalization in the core segment the key execution tests., The ¥20.00 full-year DPS forecast implies a moderate 30.8% payout ratio against forecast earnings, but depends on delivery of the profit plan., Low goodwill exposure—0.4% of equity—means M&A-related intangible-asset risk is not a central determinant of the earnings outlook..

Metrics to watch include Broadcasting and Content segment revenue and operating margin, Consolidated SG&A flexibility relative to revenue, Quarterly progress toward the ¥4.00bn full-year operating-income forecast, Receivable days and cash-and-deposit trends, Recurring operating income relative to dividend income and disposal gains, Interest coverage as EBIT returns to positive territory.

Regarding relative positioning, The company is financially defensive relative to highly leveraged media peers because of its strong liquidity, substantial equity base, and modest borrowing burden. Its relative weakness is operating and capital efficiency: the Q1 operating margin was -1.7% and annualized ROIC was -1.8%, so the investment case is more dependent on recovery in core media earnings than on balance-sheet restructuring.