Ladies and gentlemen, thank you for standing by, and welcome to the First Half twenty twenty Results for GTN Limited Conference Call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Managing Director and Chief Executive Officer, Mr. Bill Eady. Thank you.
Please go ahead.
Thank you. As you are aware from our revised guidance announced to the market in December, the first half of fiscal twenty twenty was challenging. Our actual results were in line with revised guidance with revenues of $95,700,000 exceeding guidance of $94,000,000 to 95,000,000 and adjusted EBITDA of $18,000,000 achieving the top end of our guidance of $17,000,000 to $18,000,000 Despite the disappointment with overall results, we did show progress in the Q2 of fiscal 2020. While revenue was down 5% in the Q1, revenue increased 7% in the Q2 of fiscal 2020 compared to the prior year. The decrease in the Q1 of this year was not unanticipated given the strength of the Q1 of fiscal 2019.
The stronger revenue in the second quarter fiscal 2020 led to a significant improvement in adjusted EBITDA as Q1 fiscal 20 20 was down 40% compared to the previous year, while Q2 fiscal 2020 was down only 3% when compared to the Q2 of 2019. Group revenue for first half fiscal twenty twenty increased 1.4% to $95,700,000 with all our operating geographies outside of Australia being up over first half fiscal twenty nineteen, while Australia recorded a 3.7% drop in revenue. Group EBITDA and adjusted EBITDA were down from fiscal from first half fiscal twenty nineteen due to higher costs. A portion of the cost increase can be attributed to the Australian dollar weakening in relation to the currencies of our other markets. In addition, network operations and station compensation expenses increased due to a full 6 months of the Rogers Toronto in Canada compared to 2 months in first half fiscal twenty nineteen of costs related to our rapidly expanding Brazilian operations.
Selling costs increased in Australia and Canada due to additional and revised staffing to attempt to grow revenue and additional sales costs in Brazil related to additional sales representatives as well as some incentive pay for sales staff due to the strong increase in revenue. Australia, our largest and most profitable market, struggled for the half year period as revenue dropped 3.7% compared to last year. However, on the bright side, revenue for the Q2 of fiscal 2020 increased 6%, which we believe outperformed the Australian advertising market, which continues to remain very, very difficult. We are working diligently to increase revenue and have made a number of staffing changes to help us accomplish this. Importantly, our network continues to have strong position in all the major metropolitan markets in Australia, and we are well positioned to take advantage of any market rebound.
Canada was disappointing as revenue only increased 2% and is actually down in local currency for the period despite having Rogers Toronto for the entire 6 month period this fiscal year. The shortfall in revenue was primarily related to July August, which was a transition period after the departure of our market manager. We hired new sales managers in September 2019 and did significantly better in the final 4 months of fiscal 2020. This momentum has carried over to the beginning of second half fiscal twenty twenty as well. Our U.
K. Operations have a solid performance for first half fiscal twenty twenty. Revenue was up 4%, which led to an increase in EBITDA for the period. Despite a challenging environment, our U. K.
Operations continue to be a steady reliable source
of cash flow for the company.
Brazil continues to be our fastest growing market and we have made great strides in our market rollout. Revenue increased 27.5% compared to first half of last year. In local currency, the increase was still an impressive 26%. Despite the additional cost of expanding the markets, including opening Puritiva, our 8 markets in Brazil, EBITDA increased for the period. In line with our growth strategy, we intend to continue to invest in Brazil as we see the potential upside to be significant.
We are currently assessing new Brazilian markets, although none of the plans have been finalized as of today. I will now turn the call over to Scott for a complete review of the financials.
Thanks, Bill, and good morning, everyone. Revenue for 1H fiscal 2020 grew 1.4 percent to $95,700,000 Revenue in all of our operating geographies outside of Australia that were up over 1H fiscal 2019. When compared to 1H fiscal 2019, Brazil revenue was up 27.5%, Canada revenue was up 2%, UK revenue was up 4%, while Australia revenue decreased 4%. Australia now accounts for 49% of our consolidated revenue, which is down from 51% for 1H 2019. Revenue in all of our markets outside of Australia was aided by favorable foreign currency fluctuations.
When measured in local currencies, Brazil revenue increased 26%, United Kingdom revenue increased 1% and Canada revenue decreased 3% compared to last year. Adjusted EBITDA, which we define as earnings before interest, taxes, depreciation and amortization, adjusted to include the non cash interest income generated by the financing component of our long term station affiliation agreement with Southern Cross Asterio and excludes transaction costs and foreign exchange gains and losses was $18,000,000 a decrease of 19.6 percent compared to 1H fiscal 2019. We consider it appropriate to add the financing component of our long term station affiliation agreement with Southern Cross Asterio to EBITDA, because EBITDA includes a large portion of non cash station compensation expense related to the agreement. And by including both amounts in adjusted EBITDA, we believe it provides a clearer view of the financial impact of the agreement. Adjusted EBITDA was negatively impacted by increased costs during the period, including increases related to foreign currency translation fluctuations.
Since the AUD weakened against all of our all the currencies of the countries in which we operate in, the expenses of those countries, which constitute a majority of the group's expenses, are higher than they would have been had exchange rates remain constant for both periods. In addition to the impact of foreign exchange rates, the group's operating expenses were impacted by a full 6 months of Rogers Toronto in Canada, increased cost in Brazil from both new and existing markets as well as increased selling expenses across Australia, Canada and Brazil. Adjusted NPAT, which is defined as net profit after tax, adjusted to add back the tax affected non cash amortization expense related to an acquired intangible assets fell 23.4 percent to $9,900,000 The primary driver of this shortfall was the shortfall in EBITDA that was previously discussed. The company has a strong balance sheet with $50,700,000 of cash, $64,700,000 of debt, including $4,700,000 of leases resulting from the adoption of AASB 16
and $14,000,000
of net debt at 31 December 2019. The company's gearing ratio of net debt to trailing 12 month adjusted EBITDA is 0.42x as of 31 December 2019. The Board of Directors has declared an interim dividend of $0.014 per share to shareholders of record on March 13, 2020. This dividend will be 70 percent franked. The company announced today that it has extended its on market share buyback of up to 10% of its outstanding shares through 11 March 2021.
The buyback is a capital management initiative aimed at maximizing shareholder value. No target share price or minimum repurchase amount has been set. Macquarie Securities Australia Limited will continue to act as the company's broker for the buyback. I will now turn the call back to Bill for an update on 2H fiscal 2020.
Consolidated revenue for the group is expected to be up mid single digits for January, February 2020 compared to the prior year. Projected revenue in Australia for January February is expected to be down low single digits compared to the same 2 months in 2019. In local currency, we expect all of our non Australian markets to be up for the 2 month period with Brazil and Canada expected to be up significantly compared to January, February 2019, while we anticipate UK will be slightly up. Is important to note that the company has a relatively short sales cycle and therefore has a lack of visibility over forecast sales and the resulting EBITDA for the second half of the financial year. The company continues to generate significant amounts of free cash flow, which can be used for share buybacks, dividends and or debt reduction.
All 4 of our markets continue to be positioned to perform well with solid affiliate lineups, strong and improving sales staffs and virtually no direct competitors. While disappointed with the first half result, we continue to be excited by the opportunities in each of our markets and plan to continue implementing our growth strategy to maximize their
There are no questions at this time. I would now like to hand the conference back to today's presenters. Please continue.
Thank you. We intend to push hard in the coming months to improve revenue across all our markets, which should lead to increased profitability. Despite the underperformance to date for fiscal year 2020, the fundamentals of GTN are positive, supported by a strong balance sheet, low leverage and operations that generate significant cash. We look forward to speaking to you again after full year fiscal 2020 results. Thank you.
Ladies and gentlemen, this concludes today's conference call. Please go ahead with your