Corus Entertainment turns to female audiences for growth, posts an $86.8M loss

TORONTO – Corus Entertainment is making women a priority at its radio stations in a reshaped strategy it hopes will boost listener numbers.

The Toronto-based company is putting more emphasis on its recently launched adult contemporary brand called Fresh FM, which borrows from the same female-centric business model that gave new life to its specialty channels years ago.

“We are confident that, by expanding the hot adult contemporary format, we can build a highly successful women-targeted radio network,” president and CEO Doug Murphy told analysts on a conference call Thursday.

Another Fresh FM station will launch “in the coming months,” Murphy said, playing mainstream pop hits from singers like Bruno Mars, Pink and Rihanna.

Corus is trying to weather unenthusiastic spending by advertisers that has deeply cut into financial results.

On Thursday, the company reported it suffered an $86.8-million net loss in its second quarter, mostly due to a total of $130 million in writedowns on the value of goodwill — an asset related to past acquisitions — and its radio licences.

But restrained spending also hurt the overall results as companies remain cautious about their ad budgets.

“At this moment, what we can say with complete certainty is there’s a lot of uncertainty out there,” Murphy said.

“Business is coming in late. It comes like in big chunks but it’s not pacing in the way we would like to see, so we’re taking a cautious stance.”

Corus (TSX:CJR.B) has one of Canada’s largest collections of specialty television channels like YTV and HBO Canada, and a lineup of radio stations across much of the country.

The company said it won’t meet one of the targets provided to investors in November, when it expected advertising demand would improve.

Overall revenue in the quarter ended Feb. 28 was about the same as a year ago, at $191.5 million, with its television operations propping up weakness in radio revenues, which fell seven per cent to $36.3 million.

Corus said it was hit with “further economic headwinds” in the quarter that affected advertising market confidence. It listed a number of factors including a weaker Canadian dollar since Jan. 1, continued low oil prices and the closure of large retail stores such as Target Canada, which announced in January it would close all its stores.

In February, Corus rebranded two more radio stations to the Fresh FM label, bringing the roster to seven in several of the country’s key markets, like Edmonton, Winnipeg and Hamilton and London, Ont. Fresh FM also has stations in Cornwall, Kingston and Peterborough, Ont.

The rollout follows a similar approach Corus took with its speciality channels over the past decade. Less successful TV channels brands were scrapped or completely reworked to appeal directly to women, with household names like OWN: Oprah Winfrey Network, CosmoTV and the W Network joining the fray.

Most of the channels offer a vast lineup of home renovation, fashion reality TV and romantic comedies, which have proven successful even with the restrained budgets of advertisers.

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