Loss and write-downs as APN papers do it tough

A WRITE-DOWN of the value of its New Zealand mastheads has pushed regional newspaper, radio and poster company APN News & Media to a first-half net loss of $319 million as its newspapers continue to do it tough in difficult trading conditions.

By InvestSMART · 18 Aug 2012

By InvestSMART ·
18 Aug 2012

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The publisher announced a $485 million non-cash impairment charge associated with its NZ mastheads in the six months to June 30. Australian mastheads were unchanged.

APN chief Brett Chenoweth said that conditions in its publishing division on both sides of the Tasman were tough and likely to continue.

Revenue across the group fell marginally to $409 million for the period and earnings before interest, tax, depreciation and amortisation fell 12 per cent to $75 million. Revenue and earnings in the Australian publishing arm fell by 7 per cent and 9 per cent respectively on the corresponding period.

The company will pay an interim dividend of 1.5? a share. APN's shares closed at 42?.

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Frequently Asked Questions about this Article…

What caused APN News & Media's first‑half net loss?

APN reported a first‑half net loss of $319 million largely because it booked a $485 million non‑cash impairment (a write‑down) related to its New Zealand mastheads. The company said its newspapers are facing tough trading conditions, which contributed to the loss.

How large was APN’s write‑down and which assets were affected?

The company announced a $485 million non‑cash impairment charge associated with its New Zealand mastheads in the six months to June 30. APN said its Australian mastheads were unchanged.

What were APN’s revenue and EBITDA for the six months to June 30?

For the period, group revenue fell marginally to $409 million and earnings before interest, tax, depreciation and amortisation (EBITDA) fell 12% to $75 million.

How did APN’s Australian publishing arm perform in the first half?

APN reported that revenue and earnings in its Australian publishing arm fell by 7% and 9% respectively on the corresponding period.

What did APN’s management say about trading conditions for its publishing business?

APN chief Brett Chenoweth said conditions in the publishing division on both sides of the Tasman were tough and likely to continue, reflecting ongoing pressure on newspapers and related businesses.

Is APN still paying a dividend and what was announced?

Yes. The company said it will pay an interim dividend of 1.5? a share, as reported in the article.

How did APN’s share price close after the results were announced?

According to the report, APN’s shares closed at 42?.

What does a non‑cash impairment charge mean for everyday investors in APN?

A non‑cash impairment is an accounting write‑down that reduces the reported value of an asset — in this case New Zealand mastheads — but does not involve an outlay of cash. It contributes to a larger net loss on the income statement and signals that the business or asset is facing weaker prospects, which is useful for investors assessing company health and future earnings.