2FM turns a €1.67 million loss on '09

Lenny Lovett

From today's Irish Times: The station made profits of more than €7.5 million in 2007 and 2008, but made a €1.67 million loss last year. Ms Duignan said it was essential the station got back to profitability because it receives no licence fee subvention and the money it makes helps to fund all RTÉ’s other radio stations which do not make money.

So, all those who tell us that 2FM doesn't get a cent from the licence fee. Could ye explain where the money comes from to cover this loss???

GSF

They could flog it off if its loss making as the traditional arguement for keeping it was that it helped fund the rest of RTEs output. Clearly that isnt the case anymore.

mike65

And their biggest vote getter is dead while Tubbers is only doing 2 hours so even if he turns out to be as big a pull it'll still mean the revenue comes up short cos the ratings for Colm Hayes (whoever he is) 11am - 1pm will be lower.

Poly

Knock €500000 off Tubbs salary and there's a whack of it saved already.

Lenny Lovett

Given that they had a pay cut right across the board last year the advertising sales must have collapsed totally as well.

Rubik.

Duigan goes on to say - "I don't believe I am serving either the listeners or the staff in RTE if I baulk from from making hard decisions even if the outcome of those decisions is painful for some of those people involved".

With a profit of 3.5 million euros turning into a loss of 1.76 in just one year, perhaps the Head of RTE radio, Claire Duigan, should have a look at her own performance.

Bard

Lenny Lovett wrote: »

Could ye explain where the money comes from to cover this loss???

Previous retained profits, I would presume.

GSF

Bard wrote: »

Previous retained profits, I would presume.

It doesnt retain profits. Its not a seperate company.

Bard

Well then... they're not *covering* the loss internally so... must be a bank loan, use of some sort of reserve funds, or some other kind of injection involved. We don't know as we're not the RTÉ financial controller.

Rubik.

RTE's overall deficit last year was 16.5 million euros.

Poly

Bard wrote: »

We don't know as we're not the RTÉ financial controller.

No, but we are the RTE financiers, so we have a right to know.

GSF

Bard wrote: »

Well then... they're not *covering* the loss internally so... must be a bank loan, use of some sort of reserve funds, or some other kind of injection involved. We don't know as we're not the RTÉ financial controller.

when it makes a profit it is handed over to RTE group, when it makes a loss the rest of RTE must be supporting it. Presumably from RTEs general reserves or retained profits (same thing really)

tbh

Lenny Lovett wrote: »

So, all those who tell us that 2FM doesn't get a cent from the licence fee. Could ye explain where the money comes from to cover this loss???

where does any company who makes a loss get their money from to cover it?

Here's the thing, RTE *say* that 2fm doesn't get any money from the license fee, and to be perfectly honest, that's good enough for me.

For all those who disbelieve it, all you have to do is show me the facts that lead you to disbelieve it, and I'll agree with you.

The accounts are public, so if they really do get money from the license fee, it should be simple enough to prove it.

I do accept that there is a general pool of money that is managed by RTE, and I also know that 2FM benefit from having a ready made campus etc etc, but how much money actually went from RTE into 2fm? Does anyone know, or is just a case of RTE bashing again?

And, again, for the record, the only time I ever set foot in RTE is when I was washing dishes there. I've no interest in them, and amn't predisposed to be for or agin 'em. I just always hear this "2fm are getting license money" argument, but I've never heard a convincing argument why

Lenny, you've asked a loaded question. You obviously believe that RTE *do* give license money to 2FM. So, why do you believe that? Is it just because of your general mistrust of RTE, or have you actually seen any figures.

Lenny Lovett

tbh wrote: »

where does any company who makes a loss get their money from to cover it?

An ordinary company would use retained profits or shareholder funds or bank finance. 2FM does not have recourse to retained profits (as was stated earlier, they're not a limited company in their own right), nor do they have access to bank lending individually for the same reason so it must come from 'shareholder funds' which is the funding pool that is made up of the general revenue of RTE much of which is made up of licence fees.

tbh wrote: »

Here's the thing, RTE *say* that 2fm doesn't get any money from the license fee, and to be perfectly honest, that's good enough for me.

For all those who disbelieve it, all you have to do is show me the facts that lead you to disbelieve it, and I'll agree with you.

Well, the fact that they lost €1.67 million proves that they are not self funding so, by deduction, they must be getting that shortfall from the general RTE revenue. There is no other source.

tbh wrote: »

The accounts are public, so if they really do get money from the license fee, it should be simple enough to prove it.

Not so. As stated above, it is not a separate company for tax and revenue purposes and any losses must come from within. Were they a stand alone company in their own right the situation would be transparent.

tbh wrote: »

I do accept that there is a general pool of money that is managed by RTE, and I also know that 2FM benefit from having a ready made campus etc etc, but how much money actually went from RTE into 2fm? Does anyone know, or is just a case of RTE bashing again?

It's not a case of RTE bashing for the sake of it. It's a case of fair play. RTE receive a large tranch of money from each of us in the form of a tax (the TV licence). How they use it is not transparent and we as tax payers have a right to know exactly and concisely how it is spent. For instance if they are inflating presenters salaries to keep them out of the reach of commercial operators at our expense, is that right? If they are 'warehousing' programming to keep it out of the hands of competitors at our expense is that fair?

tbh wrote: »

Lenny, you've asked a loaded question. You obviously believe that RTE *do* give license money to 2FM. So, why do you believe that? Is it just because of your general mistrust of RTE, or have you actually seen any figures.

I believe it because there is no evidence to the contrary. In light of the losses they incurred and the fact that the rest of the operation (with the possible exception of RTENL) also lost money the only logical conclusion is that it must come from the licence fee as there's no other source... is there?

You should leave your personal digs at me out of it too TBH! Not very becoming of you.

tbh

Lenny Lovett wrote: »

You should leave your personal digs at me out of it too TBH! Not very becoming of you.

what personal digs? ffs man, I was just asking a question - listen, forget it.

Lenny Lovett

tbh wrote: »

Lenny, you've asked a loaded question. You obviously believe that RTE *do* give license money to 2FM. So, why do you believe that? Is it just because of your general mistrust of RTE, or have you actually seen any figures.

tbh wrote: »

what personal digs? ffs man, I was just asking a question - listen, forget it.

.
You were making a statement as a question would have had a question mark (?) at the end. As I have stated before, I have nothing against RTE in general. I do however believe that if they have the privilage of getting some of my (and your) hard earned cash they should use it prudently and fairly. This is clearly not the case. I am in the minority in that I believe we need a state owned national broadcaster but it should be run properly and in a business like fashion. Just as every other state/semi state body should.

Rubik.

But things have changed. RTE had a deficit 16.5 million euro last year. They expect to break even this year, but it doesn't necessarily follow that 2fm will also be back in surplus. If it isn't, the shortfall will be made up be RTE as the 1.67 million loss last year will.

Lenny Lovett

Exactly. And because advertising revenue is continuing to fall across all media their only recourse will be to the licence fee. Because of this and the fact that the licence revenue together with ad revenue will not cover the losses AND the current running costs something will have to give...

Lenny Lovett

Having had a look through the RTE accounts for the past few years (published online up to '09) there's no definitive breakdown of 2FM's expenses as opposed to the overall costs. I mean there's no separate costs attributed to 2fm's rent of studios, office space, vehicles, transmission etc etc. There's also no evidence of payment for advertising costs for 2FM on other RTE platforms. So it's impossible for them to say for definite that 2FM survived solely on their own earned revenue over those years and even contributed a surplus to group.