APN revenue rises in first half of the year

Media group APN increased profit and reduced its debt in the first six months of the year, the company said, but warned ough decisions would have to be made on its balance sheet.

APN, in which Independent News and Media has a 29 per cent stake, said net profit before exceptional items rose by A$1 million to $16.2 million (€11.3 million) compared with the same period in 2012. After exceptional items were taken into account, statutory net profit was $12.8 million, up from a loss of $319 million a year earlier.

Revenue increased 5 per cent to $426.5 million for the six-month period, with earnings before interest, tax, depreciation and amortisation down 4 per cent to $65 million.

New chief executive Michael Miller said the results were "acceptable" in difficult circumstances.

“The first six months of 2013 was a challenging period for APN. On the plans we have, I am confident that the team can deliver a better second half result,” he said.

Mr Miller took over as chief executive in June.

Although conditions in the publishing industry remained challenging, APN said its revenue declines were stablising. Meanwhile, its radio businesses in Australia and New Zealand were increasing market share.

“Stabilising the revenues across the publishing divisions is my principal focus. I am a big believer that these businesses do have long-term and sustainable business models,” he said. “There is no silver bullet but we are on the right track.”

The company is currently putting in place a cost savings plan in its publishing sector, which has already yielded its original target of $25 million. APN said it was now looking to reduce its costs by $35 million for the year. Corporate costs have also been cut by $3 million as the company disbanded its business development office and made other efficiencies.

Talking of tough choices, Mr Miller said the company was considering the possibility of selling off its online fashion business BrandsExclusive.

“Our focus on the balance sheet requires some tough decisions and as such we have started to explore possible divestment options for BrandsExclusive,” Mr Miller said. “This is a good business, however our aspirations here cannot be met without making further investment commitments.”

The company has already cut its debt by $17 million over the six months; it expects to cut it by $40 million to $50 million by the end of the year. There was no interim dividend paid.