Stuff ventures make up for shrinking ad, circulation revenue

NZME is looking to acquire Stuff. Photo / File

Stuff's foray into selling broadband and power packages seems to be paying off, with the media group's side ventures more than making up for its shrinking ad and circulation revenue.

The New Zealand firm is largely a footnote in ASX-listed Nine Entertainment's first-half results, and the Australian broadcaster and publisher has been trying to flog it off since buying it as part of the much larger Fairfax Media acquisition.

Stuff is the last of the Fairfax assets still to be sold, and Kiwi rival NZME is lobbying the government to smooth the way for a merger after an earlier deal was rejected by the Commerce Commission, the High Court, and the Court of Appeal.

The New Zealand publisher's advertising continued its downward spiral, falling 10 per cent to A$67 million in the six months ended Dec. 31, while circulation revenue was down a more sedate 3 per cent to A$41.7 million.

However, Stuff's other revenue – a mix of Stuff Fibre, Energyclubnz, Events, syndication and leases – more than doubled to A$21.1 million.

That helped Stuff lift first-half revenue 3 per cent to A$129.8 million, and lift earnings before interest, tax, depreciation and amortisation 2 per cent to A$17.7 million.

Nine's discontinued operations, which include Stuff, reported a loss of A$14.6 million in the six-month period, although Nine said that excluding A$22.6 million of one-off items, earnings were A$8 million.

NZME also wrote down the value of its intangible assets last year, booking a $175 million impairment charge on the value of its mastheads, goodwill, and brands.

Nine couldn't find a buyer at the right price when it first took on the New Zealand assets, and efforts to revive a deal with NZME now appear to be the Australian company's most promising exit, with NZME chief executive Michael Boggs yesterday saying that an announcement may be coming in the next few weeks.

While politicians have previously opposed the idea of a merger of the country's two biggest newspaper publishers, the latest iteration would contain a Kiwi Share obligation and has won the backing of government coalition partner, New Zealand First.

- BusinessDesk