Investors warm to APN joint venture
SHAREHOLDERS shrugged off a full-year loss for the troubled APN News & Media, instead focusing on the new joint venture in its outdoor advertising business.
SHAREHOLDERS shrugged off a full-year loss for the troubled APN News & Media, instead focusing on the new joint venture in its outdoor advertising business.APN's shares rose 1.8 per cent yesterday to 83.5? on details of its new 50 per cent partnership with Quadrant Private Equity.A $159 million cash impairment charge led to a $148.8 million turnaround in performance - from a $93.8 million profit in 2010 to a loss of $45.1 million last year.Like its fellow media players, APN has been struggling to overcome a long advertising downturn in Australia and New Zealand. With its mix of regional papers and radio stations in NSW and Queensland, revenue in tourist areas was hit by a combination of floods and poor consumer sentiment, although the chief executive, Brett Chenoweth, said the conditions in the mining towns were better.He said the company would clamp down on costs this year and ramp up product innovation. Its "digital first" approach in larger markets like Tweed Heads and Coffs Harbour was showing promising early results, he said.But the market was more interested in the details of its APN Outdoor joint venture, which is expected to generate about $190 million for APN and values APN Outdoor at $272 million.While APN will retain some exposure to the industry through its Adshel street furniture business or its Buspak and Cody business in Hong Kong, it is likely to sell its 5.3 per cent stake in outdoor advertiser oOh!media, which has received a takeover offer from Champ Private Equity.Mr Chenoweth said the venture would focus on expanding in Asia. "We had success in 2011, we're going to have more in 2012," he said. "In 2011 we won a number of contracts, in Hong Kong we provided very strong growth, as in Indonesia."APN will pay a final dividend of 5? a share on March 30.