Updated August 2013
Fairfax Media Limited
Fairfax Media Limited [ASX:FXJ] is a leading multi-platform media company in Australasia. The group comprises metropolitan, rural, regional and community mastheads and serves its audiences through high-quality, independent journalism and offers dynamic venues for commerce and information.
Fairfax Media has a portfolio of leading websites, tablet and smartphone apps, including the online news sites smh.com.au and theage.com.au in Australia and stuff.co.nz in New Zealand. The group also has leading classified and transaction websites in Australia.
Fairfax Media publishes metropolitan, agricultural, regional and community newspapers, financial and consumer magazines. The company utilises a network of printing presses at state-of-the-art facilities throughout Australia and New Zealand.
In Australia, mastheads include The Sydney Morning Herald, The Age, The Australian Financial Review, The Canberra Times, The Sun-Herald, and The Land. In New Zealand mastheads include The Dominion Post, The Press, The Sunday Star-Times, TV Guide, NZ House and Garden, New Zealand Fishing News and Cuisine, as well as agricultural publications.
The group also holds radio licenses in several metropolitan locations in Australia, including 2UE in Sydney, 3AW and Magic 1278 Melbourne, 4BC and 4BH Brisbane, and 6PR and 96fm in Perth.
For the 2013 financial year, Fairfax Media reported revenue of $2,033.8 million, 8.2% lower than the prior year and a net loss after tax of $16.4 million. The result includes a non-cash impairment charge of $444 million.
The Company reported underlying earnings before interest, tax, depreciation and amortisation (EBITDA) excluding significant items and intangible adjustments of $366 million. This result, which is 27.7% lower than the prior year, was slightly above market consensus and guidance. Cash flow from trading activities was $377 million.
The resulting write-down is reflected in the Significant Items section of the accounts. The significant items include print asset and intangible impairments of $444 million in the Regional, Printing and Agricultural operations in the second half, and a gain of $303 million on the sale of Trade Me and US Ags in the first half.
Following the impairment, the net assets of the Company remain in excess of $1.8 billion.
In February 2012, the Company announced a three-year Fairfax of the Future program to fundamentally restructure the business through a series of strategic operational changes that will reshape the Company and reset its cost base. The success of the Fairfax of the Future program is increasingly evident in the Company's financial results. The program contributed $118 million to full-year EBITDA.
Total savings from the Fairfax of the Future program is expected to be $311 million on an annualised basis by June 2015, including the additional $60 million of savings announced in June 2013.
During the 2013 financial year, The Company continued to strengthen its balance sheet. Proceeds from the sale of Trade Me and the US agricultural business were used to repay debt, including a partial repayment of the US Private Placement notes in July. This resulted in net debt at 30 June 2013 of $154 million, which is $760 million lower than the prior year.
Last updated: Thu., August 29, 2:36 AM