Fairfax Media (FXJ) has reiterated its expectation of a massive loss in fiscal 2014 as advertising revenue continues to slide.
At its annual general meeting today, Fairfax chief executive officer Greg Hywood said the group still expected a $1.6 billion loss in the financial year, with revenue for the year to date down 6% on the previous year.
"In line with previous guidance, on the current run rate of cost reduction, inflators and current reinvestment plans, we expect to deliver costs in the vicinity of $1.6 billion in financial year 2014 which is on target," Mr Hywood said.
"The post-election advertising cycle is not proving to be robust and advertising bookings are short, providing limited visibility," he said.
"We have currently committed to take $311 million out of the business by FY15, and we believe we will lift this even further through FY16."
For the financial year to date, Fairfax Media advertising revenue was down 9% for Metro Media, 10% for Regionals, 4% for New Zealand ($NZ), and Broadcasting flat.
However the booming real estate market had led to an uptick in revenue for Domain, with its overall revenue up 4%, its digital business up 32% and its digital listings business up 36%.
"Real estate activity in Sydney is particularly strong, requiring only short but effective advertising campaigns," said Mr Hywood.
"If history is any guide, in due course we will likely see a lengthening of ad campaigns and associated spend as more inventory comes to market."
Mr Hywood said the group's Fairfax of the Future cost-cutting measures announced in February last year were running ahead of target.
"We aren’t fiddling round the edges," he said.
"We have new structures, new processes, new people – but a lot less headcount and significantly less middle management."
He emphasised the group's transition to multiple revenue streams to replace traditional advertising revenue, including the continued development of its events and content marketing businesses.
Mr Hywood said Fairfax events such as City2Surf were already generating more than $25 million in total revenue.