For any TEN holders........

Here's a downgrade from McQ

"The broad US market tumbled to five-year lows overnight as
a number of poor corporate earnings reports reduced hopes
company profits were on the mend. Most surprising was a
weak report from health products company Baxter
International. This amongst others disappointed investors
after the major indices had climbed a day earlier.
The S&P 500 Index was down 24 points (2.7%) at 882 for its
lowest close since June 1997. The Dow fell to its lowest close
since September, dropping 133 points (1.6%), to 8,409. The
Nasdaq Index was down 40 points (2.9%) at 1,357. The
Nasdaq also is floundering near a five-year low.
The gold and silver prices were largely unchanged, with a
firmer US dollar dampening any buying interest.
18-Jul +/- % chg
Indices
S&P/ASX 200 3,152.3 30.1 0.96
S&P/ASX 200 Industrials 5,345.0 29.1 0.55
S&P/ASX 200 Resources 1,544.6 49.6 3.32
Dow Jones 8,409.5 -133.0 -1.56
S&P 500 881.6 -24.5 -2.70
NASDAQ 1,357.0 -40.3 -2.88
FTSE 100 4,297.3 106.7 2.55
Hang Seng 10,452.6 117.4 1.14
Nikkei 10,498.3 202.2 1.96
Commodity Prices
Aluminium (US$/tonne) 1,343.5 -17.5 -1.3
Copper (US$/tonne) 1,595.0 -25.0 -1.5
Lead (US$/tonne) 445.5 -6.0 -1.3
Nickel (US$/tonne) 7,480.0 30.0 0.4
Tin (US$/tonne) 4,490.0 40.0 0.9
Zinc (US$/tonne) 810.5 -3.0 -0.4
Gold (US$/oz) 317.7 1.5 0.5
Silver (US$/oz) 5.0 0.0 0.0
Oil WTI (US$/barrel) 27.7 0.2 0.5
Currencies
AUD/USD 0.5531 0.001 0.16
AUD/STG 0.3515 0.000 0.03
AUD/EURO 0.547 -0.001 -0.20
AUD/NZD 1.1462 0.001 0.06

Ten Network Holdings (TEN) $2.20

Short term Hold, long term Buy, risk factor High

Recommendation change

Ten Network reported its third quarter result with TV
cashflows coming in at $33.8m, up 22% on the previous
corresponding period, on the back of TV revenue growth of
24.3%.
This result was marginally below our expectations of $34.4m
due to slightly higher cost growth.
The most disappointing aspect of the result was Ten’s
outdoor advertising business, Eye Corp, which posted an
operating profit loss of -$3.3m, significantly below our
forecast of -$1.8m.
We understand that the market is growing at an underlying
rate of around 3% which means that $20m of TV revenue
growth in the quarter came from improved revenue share.
Chairman, Nicholas Falloon, commented that that double-digit
revenue growth that has continued since the end of May
is positive and highlighted that Ten is continuing to
outperform both Seven and Nine in revenue growth.
The underlying growth in the TV market supports our view
that the sector is currently outperforming both radio and
newspapers and remains most leveraged to an increase in
multinational spend in 2003.
However, the due to the higher than expected TV cost
growth, we have downgraded our 2002 full year TV operating
profit by 2.3% to $154.5m and our 2003 forecast by 3.1% to
$191m.
Furthermore, the weaker than expected result from Eye Corp,
means that we have downgraded to our full year 2002
cashflows for this business from $6m to $3m.
As a result of these downgrades our valuation has fallen from
$2.46 per share to $2.42 per share. We have downgraded
our short term recommendation to a Hold as we see more
upside at this stage in PBL.
While Ten will continue to report strong numbers over the
coming 12 months, we think that this is captured in the
current price.