Fairfax Media’s full-year operating performance remained stable, with sales down just 0.6% to $2.5bn and earnings down 5% to $607.4m. But it also revealed a whopping $650.8m impairment charge, which helped push the media group to a painful $400.9m post-tax loss.
Chief executive Greg Hywood said: “While we have reported an after-tax loss for the year for statutory purposes, it is important to highlight that this is due to substantial impairment and restructuring charges.”
Revenues held firm at its printing operations, which comprise 15 plants in Australia and eight in New Zealand, with sales largely coming from internal publications.
Fairfax launched a two-year, $85m cost savings plan, which follows the $15m cost saving strategy it already rolled out in the second half.
“Printing rationalisation may deliver up to $30m of the $85m savings,” said the financial report.
It said printing joint venture opportunities are “being scoped”.
While Fairfax has not given away specific details on the future of its printing operations, the report said that a “detailed plan exists for substantial cost reductions within metro” and pointed to “structural changes to printing and distribution business”.
There is continued speculation that Fairfax is looking to tie up printing on both sides of the Tasman, with rival News Limited in Australia and APN News & Media in New Zealand.
Write-downs were also the order of the day at APN, which announced a $156m impairment on intangibles in its half-year results to 30 June 2011.
The charge was largely attributed to the faltering New Zealand metropolitan newspaper market.
The write-down meant that despite revenues holding firm at $508.1m, the group fell to a net loss after exceptional items of $98.3m.
APN chief executive Brett Chenoweth called the company’s outdoor division a “standout performer”, with revenue up 11% and earnings before income tax up 80%.
He also hinted at printing combinations to come. “We will continue to look to partner in printing and distribution where it makes sense.”
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