Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Fairfax Media slashes New Zealand mastheads value by 80%

Fairfax Media slashes New Zealand mastheads value by 80%

By Paul McBeth

Dec. 28 (BusinessDesk) - Fairfax Media, which publishes the Dominion Post, Press and Sunday Star Times newspapers, slashed the value of its New Zealand mastheads by more than 80 percent in a group-wide writedown of its traditional publishing assets.

The New Zealand holding company, Fairfax New Zealand Holdings, valued its local newspaper titles at $175.2 million as at June 30, down from $950.1 million a year earlier, according to financial statements lodged with Companies Office. Value is allocated to the mastheads based on how much a company expects to recover from the asset, and is reviewed annually.

The bulk of the remaining value in its titles is in the North Island publications such as the DomPost and Waikato Times, valued at $112.5 million, compared to $564.1 million in 2011. The South Island publications, including the Press and the Nelson Mail, were written down to $54.9 million as at June 30 from $343.2 million, while national publications such as the Sunday Star Times and Cuisine magazine, were valued at $7.7 million from $42.8 million.

The wider Fairfax group took a A$2.8 billion impairment on its goodwill and mastheads in the 2012 financial year as it reassessed the value of its traditional media assets and attempts to reform itself into a nimble, digital-based company.

Part of that strategy has been for Fairfax to sell out of online auction site Trade Me in three tranches in the past year, generating some $1.72 billion in cash which it's used to pay down debt and buy technology investment firm Netus. Trade Me's goodwill was valued at $729.7 million as at June 30.

Fairfax NZ Holdings made a loss of $709.1 million in the year ended June 30, due to the $776.4 million impairment charge it took in writing down its assets. That implies its underlying profit was $67.3 million. Revenue edged up 0.9 percent to $611.2 million, of which $443.2 million came from the local media assets and $146.2 million from Trade Me.

In August, the Australian parent said its New Zealand media assets reported a 6.8 percent fall in advertising revenue to $300.8 million and a 5.6 percent drop in circulation sales to $129.1 million. Earnings before interest, tax, depreciation and amortisation dropped 9.9 percent to $78.1 million.

The local media unit paid a dividend of $11.1 million in the 2012 year, down from $48.1 million a year earlier. It made a further dividend payment of $15.7 million after the June 30 balance date.

Fairfax New Zealand paid $87.9 million in finance costs in the 2012 year compared to $133.4 million in 2011, as related party debt more than halved to $401 million.

The ASX-listed Fairfax shares rose 1 percent to 48.5 Australian cents today, having shed 35 percent this year. The stock is rated an average 'hold' based on 13 analyst recommendations compiled by Reuters, with a median target price of 50 Australian cents.

The media group's market capitalisation value of A$1.13 billion is almost half the enterprise value of $2.23 billion in the Reuters consensus.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Planes: Jetstar Launches Regional Network With $9 Fares, Five Routes

Jetstar, the Qantas Airways budget offshoot, launched its new regional network in New Zealand with special $9 one-way fares and has narrowed down its choices to five routes and four destinations - Nelson, Napier, New Plymouth, and Palmerston North. More>>

ALSO:

Tourism: China Southern Airlines To Fly To Christchurch

China Southern Airlines, in partnership with Christchurch Airport and the South Island tourism industry, has announced today it will begin flying directly between Guangzhou, Mainland China and the South Island. More>>

ALSO:

Dodgy: Truck Shops Come Under Scrutiny

Mobile traders, or truck shops, target poorer communities, particularly in Auckland, with non-compliant contracts, steep prices and often lower-quality goods than can be bought at ordinary shops, a Commerce Commission investigation has found. More>>

ALSO:

Auckland Transport: Government, Council Agree On Funding Approach

The government and Auckland Council have reached a detente over transport funding, establishing a one-year, collaborative timetable for decisions on funding for the city's transport infrastructure growth in the next 30 years after the government refused to fund the $2 billion of short and medium-term plans outlined in Auckland's draft Unitary Plan. More>>

ALSO:

Bullish On China Shock: Slumping Equities, Commodities May Continue, But Not A GFC

The biggest selloff in stock markets in at least four years, slumping commodity prices and a surge in Wall Street's fear gauge don't mean the world economy is heading for another global financial crisis, fund managers say. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news