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.