KEY POINTS:
Trans-Tasman media company APN News and Media says the economic slowdown is affecting its businesses in New Zealand with a number of major advertisers cutting back their advertising plans.
APN today reported trading revenue for the six months to the end of June rose 2.5 per cent to
A$624.5 ($798.6) million, but in New Zealand revenues actually declined 2.4 per cent in constant currency terms. In Australia they rose 5.7 per cent, and in Asia they were up 20.9 per cent.
Net profit for the six months ended June fell 0.7 per cent to A$71.9m. The company will pay an interim dividend of A10.5c, unfranked.
In New Zealand, APN publishes The New Zealand Herald, 10 regional daily newspapers, the Woman's Weekly and the Listener. It also operates nzherald.co.nz, and The Radio Network (TRN), across eight networks including NewstalkZB and Classic Hits.
"These are a good set of results against the background of the global credit crisis," chief executive Brendan Hopkins said.
"Our Australian and Asian businesses have performed well during the period, with in particular our Outdoor business being the standout performer."
The media firm said it was comfortable with analysts' consensus forecast for a net profit for calendar 2008 of A$162m.
But Hopkins noted the full year result "will largely depend on the performance in the final quarter, where 33 per cent of earnings before interest and tax traditionally occurs, and there being no further deterioration in the New Zealand trading environment".
APN publishes 23 regional daily newspapers and more than 100 non-daily and community titles across Australia and New Zealand.
Overall, earnings before interest and tax (ebit) from its publishing arm dipped 10 per cent to A$91.8m.
Within the publishing operations, NZ National Publishing - which comprises the Herald, Herald on Sunday, The Aucklander and New Zealand Magazines - ebit was down 10 per cent to A$42.4m
Conditions remained challenging as the company traded through the cycle, but a number of innovations and new sections across the publications had gained support from advertisers, APN said.
Ongoing tightness in the market for commercial printing accounted for half the reduction in the division's revenue, pointing to the resilience of the publishing assets.
National advertising continued to perform well, but other pillars had some softness, the company said.
For the radio division, which comprises the Australian Radio Network and TRN, ebit dipped 7 per cent to A$33.8m.
In New Zealand challenging marketing conditions continued but the acquisition of 21 more licences at auction in May for $1.3m would extend the reach of TRN's networks, APN said.
APN Outdoor, which does outdoor advertising, lifted overall ebit by 74 per cent to A$16m, but only 9 per cent of the division's revenue was from this country, with 72 per cent from Australia and 19 per cent from Asia.
The company announced today it had bought Media1, this country's third largest outdoor advertising business.
The regional publishing division's New Zealand operations had a 12 per cent decline in employment advertising revenue, a 9 per cent decline in motoring and a 4 per cent fall in real estate. Retail was up 1 per cent and government/other up 4 per cent.
- NZPA
