Fairfax reveals $448m fall in value of mastheads
Fairfax Media – the owner of titles such as The Sydney Morning Herald and The Age – today said it had wiped nearly half a billion dollars off the estimated value of its mastheads, based on the company’s weakened future profit prospects.
The revelation came in the company’s announcement of its results for the six months to the end of 2008.
It said it was cutting $447.5m from the value of the company’s mastheads, licences and goodwill. It said that it was also factoring into its numbers redundancy and restructuring costs of $62.4m.
The one-off items led it to declare a loss, before interest and tax, of $227.8m, compared to a profit of $352.8 in the same period a year before.
However, the company said that its underlying trading performance saw a profit of $313.6m, which was down 14.1% on the same period 12 months previously.
Sydney and Melbourne print markets were particularly badly hit, seeing a decline of 23.2%, while New Zealand Publishing was even worse with a fall of 28.6%. Australian Regional & Community Publications was down 9%; Australian Printing down 13.9%; and Specialist Publications was also down 13.9%.
The only bright spot was the company’s online division which saw a profit growth of 13.3% to $56.4m.
CEO Brian McCarthy said this morning the result credible “in the face of significantly deteriorating economic conditions”.
However the company warned that trading conditions in January and February were “weaker”. It said it expected a slight improvement in display advertising but not in classifieds.
The company said that its four priorities for the coming months would be: a new management structure; operational improvements; cost savings and leveraging greater opprtunities with its print/ online link-ups.
Tim Burrowes founded Mumbrella in 2008. He worked on Mumbrella until 2021. At various points he was editor, content director and editor-at-large.
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Weird that we are expecting such bad news that half a billion doesn’t seem so bad…
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