Fairfax profit up after asset sales

Fairfax Media LogoFairfax Media Limited has reported a net profit after tax of $224.4 million despite a 3 per cent decline in total revenue for the 2014 financial year.

The company’s net profit was a significant turnaround from last year’s loss of $16.4 million, and its net cash flow of $68 million an improvement from a net debt of $154 million from 2013.

The sale of accommodation website Stayz in December last year for $220 million significantly contributed to the positive profit results for 2014, however it was offset by restructuring and redundancy costs of $16.9 million and impairments costs of $16.8 million.

Fairfax chief executive and managing director Greg Hywood said that transforming diverse businesses like Fairfax took time and that he was pleased by the company’s performance the past year.

“We are in a net cash position and we’ve strongly grown earnings per share” he said. “Today’s result underlines the ability of Fairfax to deal with the enormous structural changes impacting upon the industry.”

“We have stabilised earnings and have completely remade a legacy-based, vertically-integrated newspaper business into a genuinely multi-platform media company. We are now a leaner, more agile business.”

Fairfax’s metropolitan media division saw a revenue decline of 6.3 per cent, although digital subscriptions for The Sydney Morning Herald, The Age, and The Australian Financial Review generated $19.2 million more than last year.

“In early August, The Sydney Morning Herald and The Age had more than 140,000 paid digital subscribers, and an additional 111,000 eligible print subscribers who have signed up for digital access,” Mr Hywood said.

“The contribution of digital subscriptions together with our focus on profitable print circulation saw underlying circulation revenue increase 11.4 per cent for the year.”

Underlying revenues in Fairfax New Zealand businesses were down 3.4 per cent on 2013 in local currency terms.

EBITDA (earnings before interest, tax, depreciation and amortisation) increased by 1.8 per cent to $306.4 million.

News Corp Australia recently announced its 2014 figures, posting a near 12 per cent increase in earnings.

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