APN writedown causes overall loss in half-yearly results

APN News & Media announced an impairment charge today of A$485 million on its New Zealand newspaper assets, sending the company into an overall loss in its half-yearly results.

The writedown reflects “the impact of prevailing industry conditions”, the company said in a statement. “APN continues to make operational improvements within its publishing businesses in New Zealand and remains confident of its ongoing strong contribution to the group.”

The company reported an overall net loss after tax of A$319 million.

Revenue was down 6 per cent and earnings down 12 per cent while net debt was reduced by A$168 million.

APN chief executive Brett Chenoweth said: “It has been a tough first half for our publishing businesses, particularly in New Zealand. While it is clearly a difficult result, our newspapers have remained very profitable and relevant despite difficult advertising markets and structural challenges.

“Newspapers continue to set the local and national news agenda each day and this content is now reaching a broader audience through our digital platforms. We are evolving our business model to capitalise on the shifting audiences and are well placed to do this from within our existing businesses and also through new digital plays that leverage our core assets and market reach.”

Mr Chenoweth also said the company had reduced its cost base and was rejuvenating its products to adapt to a changing media context and was accelerating these reforms.

These include relaunching the New Zealand Herald as a “compact” in September with increased digital integration, creation of a multi-media sales team, and the conversion of regional titles to compact and morning delivery. All titles will be converted by the first quarter of 2013.

The New Zealand publishing arm will also reduce staff by an additional 100 in 2012 on top of the 400 roles cut in the past three years. The company said it will also further refine its production models to lower costs and pursue flexibility in its cost base.

APN’s radio and outdoor assets saw increased revenue and earnings.