APN full year results:
Revenue - A$1.2bn, down 5pc
Profit - -A$24m, down 114pc
Dividend - 12 cents per share
KEY POINTS:
SYDNEY - Media group APN News and Media has reported a A$24 million ($NZ30.76 million) loss for the 2008 year, but expects a profit of A$120 million in 2009.
APN's loss was down 114 per cent on fiscal 2007. Underlying profit, before impairments and other exceptional items, was A$140.1 million, down 17.3 per cent from A$169.5 million on 2007.
Revenue was A$1258.3 million, or an underlying A$1226.4 million.
APN declared a final dividend of 12 cents unfranked.
The group's loss after impairments was on the back of a charge of A$146.8 million against New Zealand assets bought as part of APN's purchase of Wilson and Horton in 2001.
APN owns a range of newspapers and radio stations in Australia and New Zealand, including the New Zealand Herald. It also owns the website nzherald.co.nz.
The company said it was "extremely difficult to forecast against the background of world market conditions".
But it expects expected net profit in fiscal 2009 to be "in line with market consensus of A$120 million, with almost all the shortfall against the 2008 year occurring in the first half".
APN Chief Executive Brendan Hopkins said 2008 had "produced the most challenging trading conditions that APN has faced as a listed company".
"Given the uncertainty in the broader marketplace and the economic factors affecting our clients, we believe annual Net Profit After Tax prior to exceptionals of A$140.1 million to be a satisfactory result," said Hopkins.
He said the second half of 2008 had been "particularly challenging".
"As mentioned at the time of the interim result, the New Zealand businesses faced a sharp slowdown in the local economy. As expected, this flowed through to our advertising revenues and required significant restructuring of our costs.
"Costs in the New Zealand operations were down in local currency terms.
"In Australia, despite attempts by the Federal Government to stimulate consumer demand, the gathering momentum of the global financial crisis affected the confidence of our customers.
"This resulted in a number of national advertisers electing not to proceed with planned campaigns. This particularly affected our Outdoor and Australian Publishing businesses in November and December."
Hopkins said APN's now completed restructuring and replanting programme "positions APN well for these difficult times.
"All material capital expenditure programs in connection with the restructuring are finalised and the vast majority of the one-off costs of restructuring are also behind us.
"As we face the new year we are seeing these benefits reflected in our cost base, albeit a couple of months later than we had anticipated."
Total costs for the first quarter of fiscal 2009 would be seven per cent less than in the prior corresponding period.
Forward bookings in March were in line with expectations after a slow start to the year.
National and Retail advertising, which accounted for almost 80 per cent of total advertising revenues and almost 60 per cent in APN's publishing divisions, was "solid".
Outdoor bookings were trending to levels achieved in 2008 and Radio was showing gains in advertising market share in Australia, as forecast.
Hopkins said APN had "a strong balance sheet", and was satisfied with its existing credit facilities, despite the difficult prevailing credit conditions.
The company had no material debt facilities maturing until December 2009, with maturities extending to 2012.
Overall debt levels "remain satisfactory".
"The outlook for the year remains challenging, with the first half being set against a good performance in the prior period," Hopkins said.
"The diversity in our revenue base will help us ...
"Although there was a decline in revenue and (earnings before interest and tax) EBIT, all of APN's Divisions either grew or maintained market share in 2008."
On the impairments, which dragged APN's reported result into loss for fiscal 2008, the company said the current value of all other assets, other than those acquired in the Wilson and Horton acquisition, was "well in excess of their book value".
- AAP
