APN NEWS & MEDIA had $33 million wiped off its market value after its shares plunged to new lows following a profit warning.
In a statement released after the market closed on Thursday, APN said it expected net profit before exceptional items for the 2012 calendar year to come in between $51 million and $54 million.
If the result prints in line with company guidance it would represent a decline of up to 34 per cent from the $78 million underlying net profit for last year.
APN, which owns regional newspapers and radio stations across Australia and New Zealand, digital assets and outdoor advertising joint-ventures, fell sharply when the market opened on Friday.
The stock closed 5¢, or 15.9 per cent, lower at a new record low of 26.5¢. In percentage terms APN was the worst-performing stock on the S&P/ASX200.
APN had warned investors its publishing revenue was down 10 per cent since June, although cost savings had offset some of the decline.
Its publishing units had achieved $25 million in cost savings this year, with a further $25 million saving expected next year.
The APN chief executive, Neil Chenoweth, said conditions in the second half of 2012 were more challenging than the first six months, with advertising bookings extremely short.
The stark earnings warning prompted analysts to downgrade the stock.
A Morningstar Equities Research analyst, Michael Higgins, has placed the stock under review, lowered his estimates of full-year profit and raised the possibility APN may have to write down the value of its newspapers. "We don't expect conditions to improve materially in the short term," Mr Higgins told clients.
The CIMB analysts Fraser McLeish and Alan Stewart downgraded the stock to neutral. "We believe that both FXJ (Fairfax Media) and SWM (Seven West Media) offer less risky ways to play the sector at the current time," they said.