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

 


Fairfax Media reverses slide in NZ earnings

Fairfax Media reverses slide in NZ earnings as cost cuts offset drop in ads, circulation

By Jonathan Underhill

Aug. 14 (BusinessDesk) - Fairfax Media Group reversed a slide in earnings from its New Zealand business as cost cutting helped make up from a continued decline in advertising and circulation.

Earnings before interest, tax, depreciation and amortisation rose 3.1 percent to $80.2 million. Costs fell 7.3 percent to $318.6 million, making up for a 5.4 percent decline in revenue to $398.9 million. Advertising sales in the year fell 5.2 percent to about $269 million while circulation declined 6.6 percent to $117.9 million.

Fairfax chief executive Greg Hywood said print advertising in New Zealand isn't declining at the same pace as in Australia and benefited from a strong agricultural sector, stabilisation in property advertising and local government spending, although there was "weakness in a number of categories including retail and employment.

Fairfax's cost cutting in New Zealand has included axing workers and sharing some printing with rival APN News & Media. Fairfax, which publishes the Dominion Post, Press and Sunday Star Times newspapers and operates the Stuff website, slashed the value of its New Zealand mastheads by more than 80 percent in 2012 to recognise the decline in traditional publishing.

The Fairfax group posted a profit of A$224.4 million in its latest year, compared to loss of A$16.4 million a year-earlier, when it took impairments of A$444 million on print assets and intangibles. In the latest year, one-time items netted out as a gain of A$66.7 million. Sales fell 3 percent to A$1.97 billion.

The company is two years into a three-year restructuring programme it calls Fairfax of the Future, which is targeting annualised savings of A$311 million in 2015. Net costs to deliver the programme through 2015 are expected to be about A$290 million, including A$245 million for redundancies, capital spending of A$86 million and operational spending of $25 million.

"Today's result underlines the ability of Fairfax to deal with enormous structural changes impacting upon the industry," Hywood said. "We have stabilised earnings and completely remade a legacy-based, vertically-integrated newspaper business into a genuinely multi-platform media company."

The company will pay a final dividend of 2 Australian cents a share, bringing total payments for the year to 4 cents.

Shares of Fairfax last traded on the ASX at 88.5 Australian cents and have climbed 62 percent in the past year. The stock is rated a 'hold' based on the consensus of 12 analysts polled by Reuters, with a median price target of 91 Australian cents.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Insurance: EQC To Double Payout, Scrap Contents Insurance

New Zealand’s Earthquake Commission may double its payout amount, scrap contents insurance and process claims through private insurers under the government’s long-running review of funding and management of the state-run earthquake insurer. More>>

ALSO:

Gordon Campbell: On Tiwai Point (And Saying “No” In Greece)

Its hard to see how Rio Tinto’s one month delay in announcing its intentions about the Tiwai Point aluminium smelter is a good sign for (a) the jobs of the workers affected or (b) for the New Zealand taxpayer. More>>

ALSO:

Half Empty: Dairy Product Prices Extend Slide To Six-Year Low

Dairy product prices continued their slide, paced by whole milk power, in the latest GlobalDairyTrade auction, weakening to the lowest level in six years. More>>

ALSO:

Copper Broadband: Regulator Set To Keep Chorus Pricing Largely Unchanged

The Commerce Commission looks likely to settle on a price close to its original decision on what telecommunications network operator Chorus can charge its customers, though it probably won’t backdate any update. More>>

ALSO:

Lower Levy For Safer Cars: ACC Backtracks On Safety Assessments

Dog and Lemon: “The ACC has based the entire levy system on a set of badly flawed data from Monash University. This Monash data is riddled with errors and false assumptions; that’s the real reason for the multiple mistakes in setting ACC levies.” More>>

ALSO:

Fast Track: TPP Negotiations Set To Accelerate, Groser Says

Negotiations for the Trans-Pacific Partnership will accelerate in July, with New Zealand officials working to stitch up a deal by the month's end, according to Trade Minister Tim Groser. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news