Southern Cross Media Group (ASX: SXL) has made good on its plans to opt out of television altogether after announcing the $6.35 million sale of its remaining assets to independent media group Australian Digital Holdings, a new conservative broadcaster that is backed by James Packer.

The move comes on the heels of Southern Cross in December announcing the sale of its television licences in the three aggregated markets of Queensland, southern NSW and Victoria to the Paramount Global-owned Network 10.

Today’s announcement was accompanied by an improved profit result for Southern Cross in the first half of FY25, as EBITDA lifted 24.6 per cent to $24.1 million following a 5.3 per cent increase in revenue to $209.7 million. Net profit after tax also increased – up 5.5 per cent to $3.2 million.

The sale of the group’s remaining television assets follows a strategic review of the business which will now be solely focused on its regional and metropolitan radio and digital audio networks, which includes the Triple M and Hit stations.

Under the deal announced today, Australian Digital Holdings will acquire the remaining television assets in Tasmania, Spencer Gulf, Broken Hill, Mt Isa, Darwin and remote, central and eastern Australia for $6.35 million.

The payment comprises $3.75 million in cash up front and the remaining $2.6 million to be received through the provision of “transitional service arrangements”.

“The completion of this sale will result in SCA (Southern Cross Austereo) having fully divested of its television assets,” says the company.

“SCA intends to apply upfront cash consideration from the sale of its television assets towards reducing net debt.”

The company estimates the sale proceeds from all of its television assets will range from $19 million to $24 million, which represents a multiple of about four to five times forecast EBITDA.

The sale to Australian Digital Holdings, which operates as ADH TV, is expected to be completed in a matter of weeks.

ADH TV, which is led by co-founder Jack Bulfin as CEO and chaired by Maurice Newman, was founded in 2021 with backing from Packer as an alternative to mainstream media companies by presenting libertarian and conservative views.

Following the sale to Australian Digital Holdings and with the deal with Network 10 expected to settle on 1 March 2025, Southern Cross CEO John Kelly says the SCA brand is now “all about audio”.

“The successful exit from television allows SCA to focus on building upon the positive operating momentum within our leading radio and digital audio assets, led by LiSTNR, HIT and Triple M,” says Kelly.

The company’s continuing audio and corporate operations reported a 5.3 per cent lift in revenue to $209.7 million and a 46.8 per cent lift in EBITDA to $31.2 million in the first half of FY25.

Southern Cross says the improvement was driven by its dominance of the “lucrative 25-54 audiences in metro and regional radio markets, improving share of metro radio advertising markets, strong growth in digital audio revenues and disciplined approach to cost management”.

LiSTNR achieved marginal underlying EBITDA profitability in the first half as digital revenue grew to $22.1 million, up 42 per cent. EBITDA was about $100,000, an $8.7 million improvement from the loss in the previous corresponding period.

Southern Cross is not paying an interim dividend, instead focusing its cash reserves on reducing debt.

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