August 4th, 2010
West Australian Newspapers Holdings posted a 10.3 per cent rise in full-year profit and said its markets were in modest recovery phase.
But the Perth-based publisher cautioned that its new financial year had got off to a more muted start as uncertainty about the federal government’s planned tax on resources companies and the upcoming federal election dragged on advertising demand.
WA News said that net profit for the 12 months ended June 30 rose to $96.2 million, up from $87.2m a year before. The year earlier’s result was weighed down by one time costs, including redundancy costs.
On a normalised basis, its profit was down slightly from $97.1m last year but roughly in line with market estimates. Citi analysts had forecast a normalised profit of $98m.
“To have finished the year more or less on parity with the prior financial year is a strong result,” chief executive Chris Wharton said.
“After seeing solid recovery in the second half of the year, when compared to the same period in 2009, we are faced with markets in a modest recovery phase.”
The group didn’t give guidance but Mr Wharton conceded that WA News hasn’t seen a “normal” start to the new financial year.
“The announcement of the Resource Super Profits Tax threw a bit of a spanner in the works,” Mr Wharton told analysts after the result. “It caused more than some nervousness. It impacted us, we estimate, to the tune of about $2 million,” he said.
“Hot on the heels of that, we had the (former) Prime Minister tipped out and an election called. Traditionally an election slows everything down and people just put stuff on hold,” he said.
But he still said the group was trading well, and up from last year, he expects a clearer picture on industry trends after the August 21 election.
The group recorded a profit of $24.7m for the fourth quarter, a 28 per cent improvement over the same period a year ago. Full-year revenue fell to $409.2m from $418.0m a year before, with revenue at its core West Australian newspaper down 2.8 per cent on year at $246.1m.
Circulation revenue at the paper fell 5.4 per cent to $66.5m.
WA News, which is the first major Australian media company to report results this earnings season, said it will pay a final dividend of 26 cents a share, up from 10c a year ago.