APN posts record A$66m profit

Australasian media group APN News & Media Ltd, owners of the New Zealand Herald, Herald on Sunday and nzherald.co.nz online news service, said today its first-half net profit rose 17 per cent due to a strong performance from its newspaper and radio divisions and said it was on track for double digit growth for the full year.

APN said its first-half net profit came in at A$66.08 million ($72.91 million).

The company, controlled by Irish media tycoon Tony O'Reilly's Independent News & Media, also owns a string of regional papers including the Levin Chronicle, the Wairarapa Times Age, Wanganui Chronicle, Hawke's Bay Today, the Northern Advocate, the Daily Post, the Bay of Plenty Times and the Christchurch Star.

Shares in the dual-listed APN last traded in New Zealand on Friday at $5.73. In Australia APN shares have risen 3.1 per cent so far this year compared with a 10 per cent rise in the overall index. APN shares closed at A$5.31 yesterday.

Today's record profit comes as staff at four of APN's New Zealand daily newspapers are striking over what they see as a "paltry" 2.8 per cent pay increase.

More than 100 workers at the Wanganui Chronicle, Hawke's Bay Today, the Wairarapa Times-Age and the Levin Chronicle walked off the job for 24 hours yesterday in a campaign for a 5 per cent pay rise.

Engineering, Printing and Manufacturing Union national secretary Andrew Little described the APN offer as paltry, given the company's record profits.

"Much of that profit has been earned off the back of New Zealand newspapers, productivity has increased enormously, and the people who staff those newspapers are entitled to a fair share," he said.

Revenue rose 10 per cent in the half year period to A$652 million.

The company will pay an interim dividend of 8.8 cents per share.

"The board of APN continues to believe that, providing current trading conditions continue, the objective of double digit profit growth for the year as a whole will be achieved," chief executive Brendan Hopkins said.

APN formed the New Zealand National Publishing (NZNP) division in 2004 to coordinate the Auckland market. That strategy has seen readership of its Auckland products rise to 68 per cent by June 2005.

APN's new initiatives, the Herald on Sunday (launched in October 2004), and The Aucklander (launched in October 2003), are expected to remain in the "investment phase" for the next 12-18 months, Mr Hopkins said.

Excluding the Herald on Sunday and The Aucklander, EBIT for the NZNP division grew by 14 per cent during the period, and revenue grew by 9 per cent.

Overall revenues, including the new papers, grew 12 per cent.

In its first six months, circulation of the Herald on Sunday exceeded expectations, reaching 101,355 in its first audit, with readership of 363,000.

The Aucklander has a readership of 453,000.

The Listener and the New Zealand Woman's Weekly magazines both grew subscription levels in the first half. Creme, New Zealand's fastest growing teen magazine, was acquired during the year.

Circulation for APN's regional newspapers was also positive, with the Bay of Plenty Times and Wanganui Chronicle the country's fastest growing papers, with circulations up 1.6 per cent and 1.4 per cent respectively.

The Radio Network (TRN) in New Zealand successfully launched Coast and Flava into the Auckland market last year. Coast is Number 3 and Flava Number 4.

TRN grew revenue by 13 per cent to A$56.4 million and increased EBIT by 24 per cent to A$13.3 million.

- NZPA