The Seven West Media Ltd (ASX: SWM) share price is plummeting on Tuesday despite the release of what the company's management called its "strongest financial performance … in over a decade".
As The Motley Fool Australia reported earlier, the media group posted a 60% increase in underlying after-tax profit – coming to around $201 million – for financial year 2022 and announced an on-market share buyback this morning.
At the time of writing, the Seven West share price is 48 cents, 5.77% lower than its previous close.
Let's take a closer look at today's news from the All Ordinaries Index (ASX: XAO) stock.
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Seven West share price plunges on full year earnings
The Seven West share price is tumbling following the release of the company's full year earnings and news of an on-market buyback aiming to snap up 10% of its outstanding stock.
The company clocked a 21% improvement in revenue – lifting to $342 million – and a 35% lift in earnings before interest, tax, depreciation, and amortisation (EBITDA), which came in above guidance at $1.5 billion.
On top of that, its operating costs amounted to nearly $1.2 billion, which was within its guided range, while its net debt deepened to $256.5 million.
Seven West managing director and CEO James Warburton celebrated the company's financial performance, saying:
These results represent the best Seven television EBITDA results in 11 years, the best EBITDA from West Australian Newspapers in five years, and our best group EBITDA result in six years.
Perhaps it's the company's outlook that's weighing on its stock on Tuesday.
Seven West expects its total TV advertising market to fall this quarter, mainly due to the impact of the Tokyo Olympic Games, broadcast on the company's free-to-air network last year.
It also predicts its share of total TV revenue will stay flat at 39% this financial year while its operating costs are tipped to come in slightly higher at between $1.2 billion and $1.22 billion.
Today's fall included, the Seven West share price is trading 22% lower than it was at the start of 2022. Though, it's still 2% higher than it was this time last year.
