Australian media group APN said today it would raise new capital and refinance to trim costs after healthy advertising at its main newspapers helped push up first-half profit by 24 per cent.
APN, which publishes 24 daily and 90 non-daily newspapers in Australasia including the New Zealand Herald, said it was confident second-half results would be stronger and match market forecasts for double-digit profit growth.
The company,which is 44 per cent owned by Independent News & Media, said refinancing its 1.2 billion Australian dollar purchase of New Zealand's biggest newspaper publisher, Wilson & Horton, in 2001 would help boost earnings, but would not quantify the expected rise.
The group plans to raise $100 million (€65 million) through an equity placement and take advantage of lower interest rates in the United States to obtain $200 million through a US private debt placement.
APN said the strong performance of its Australian and New Zealand newspapers helped boost first half profits to A$44.7 million from $36.0 million a year earlier.
Analysts expect the publisher to report full year net profit of $107 million, up from $90.2 million in 2002. This implies a second half profit of about $62.3 million, from A$54.2 million a year earlier.
Although newspaper publishing makes up 70 per cent of APN's earnings, the firm also ranks as the largest radio broadcaster in Australasia with interests in 12 Australian city radio stations and 88 in New Zealand.
Earnings for APN's publishing division rose 27 per cent over the half to $76.6 million, while the radio division, which accounts for 20 per cent of group earnings, posted a nine percent EBIT rise to $21.5 million on strong local advertising sales.