APN profit drops, CEO says outlook is brighter

APN News and Media has posted a net profit of A$33.6 million for the half-year to June 30, down 53.3 percent from A$71.9 million in the same period last year.

The publishing giant, which has newspaper, radio and outdoor properties in Australia and New Zealand, has been hit by falling advertising revenues in a tough economic climate, but chief executive Brendan Hopkins told AAP there were better signs on the horizon.

“Overall, in both Australia and New Zealand many economic indicators are now turning positive, however, there has been a lag in that sentiment converting to sustainable revenue growth,” Mr Hopkins said.

“Market sentiment remains cautious but some encouraging signs are beginning to emerge.”

Mr Hopkins said he considered the overall results, as disappointing but “satisfactory” in the challenging financial climate.

New Zealand publishing earnings have already recovered to push ahead of where they were at this stage last year, Mr Hopkins said.

APN’s flagship website in New Zealand, nzherald.co.nz, was another success story. “The site is now profitable and users, page impressions and revenue all continue to grow strongly,” Mr Hopkins said.

APN’s first half revenue was down 18.8 percent to A$520.2 million in the first half, while earnings before interest and tax (EBIT) dropped 43 percent to A$78.8 million. The company did not pay an interim dividend.

Mr Hopkins said it was too early to predict whether trading conditions would improve enough to allow the Independent News and Media-owned APN to meet the A$100 million annual net profit (after one-off items) target it set for itself in May. It had predicted at the same time that it would reach around A$40 million by the half-year mark, but the net profit before one-off items fell 10 percent short at A$36.1 million.

Brendan Hopkins will speak about the state of the industry and his company’s strategy at Newspapers: The Future Forum in Sydney on September 10.

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