Media firm eyes growth opportunities as ads return

Advertising spending continued to recover through the second half of last year in line with the broader economic recovery, APN News & Media says.

The company - which publishes the New Zealand Herald - yesterday reported a net profit of A$94.2 million, down 34 per cent from a year earlier. Revenue fell 14 per cent to A$1.03 billion.

However earnings continued to improve through the second half of the year. Revenue for the six months to December 31 was down just 11 per cent and earnings were down just 25 per cent on the same period a year earlier.

"The final quarter of 2009 gave some indication that business is returning to pre-GFC [global financial crisis] patterns," chief executive Brendan Hopkins said.

The 2010 year had started positively and revenue was starting to track ahead of the same period last year.

"We're still not happy, in the sense that we'd like to be back where we were in 2007."

But the company had done well to mitigate the worst effects of the economic downturn and manage costs.

Costs were reduced by A$78 million, helping boost the performance of divisions such as New Zealand publishing, which reported just an 11 per cent fall in earnings for the second half of the year.

APN was fortunate to be operating in Australasia, which had come through the crisis well by global standards, Hopkins said. Within that, the company was also lucky to have such a strong position in high growth regions such as Auckland and Queensland.

The APN New Zealand Publishing result was stronger than the comparable result, reported on Monday, for Fairfax New Zealand's media operations. Fairfax dominates the Wellington and Christchurch newspaper markets.

"What it tells you is that Auckland and from Taupo north is probably having a better go of it than some of the other regional centres."

Hopkins said the company was now on the lookout for growth opportunities.

APN announced a 4c a share dividend, representing a payout of A$23.8 million, or 25 per cent of full-year earnings and 42 per cent of its second-half earnings.

The result was in line with market expectations. Shares were unchanged on the NZX yesterday, closing at $2.94. They were down A7c to A$2.33 on the ASX.

APN NEWS & MEDIA

12 months to December 31

Revenue
2009: A$1.03b
2008: A$1.19b

Ebitda
2009: A$230.2m
2008: A$320.8m

Profit
2009: A$94.2m
2008: A$143.1m