APN posts 27 per cent jump in profit, delays NZ float

APN News and Media has posted a net profit increase of 27 per cent for 2014, credited to strong growth in its radio and outdoor businesses, while chief executive Michael Miller announced plans to float NZME. would be delayed.

Net profit after tax was $75.2 million for the year, up from $59.3 million in 2013. EBIDTA edged up to $164.1 million from $162.8 million.

APN chief executive Michael Miller attributed the results to solid market performances in increasingly competitive conditions.

“To deliver results like this in a flat market whilst securing a market share is rewarding,” he said.

Revenue for 2014 from continuing operations hit $843.2 million, up from $817.2 million in the previous year.

A key revenue driver was the Australian Radio Network, which was up 18 per cent for the year and 28 per cent in the second half.

Cost savings of $17 million were made in the publishing division, partially offset by reinvestment in integration of its New Zealand businesses.

A dividend would not be paid as part of the company’s commitment to improving the balance sheet, Mr Miller said.

Diversification was a key aspect of the company’s strategy in 2014, as radio earnings leaped from a 27 per cent proportionate share in 2013 to 43 per cent in 2014. Digital revenues grew by 11 per cent to $59 million, making up 7 per cent of all revenues, while publishing’s share declined, falling from 56 per cent of APN’s earnings in 2013 to 38 per cent in 2014.

However, Australian Regional Media (ARM), the company’s regional publishing business, had reached a larger audience than ever before, with a total audience growth of 15.8 per cent year-on-year and an ownership of eight of Australia’s top 10 performing daily newspapers by year-on-year circulation change. Digital revenues were up 39 per cent year on year.

ARM had benefited from a deliberate focus on diversifying revenue streams, Mr Miller said, as well as a repositioning of the national brand, “Local to Local”, highlighting the strength of its advertising proposition. Circulation was 22 per cent higher than the industry average and weekly print readership grew by 3.4 per cent.

New revenue streams were a key focus in New Zealand as well, with the launch of two new businesses, NZME. Events and NZME. Experiential, this month. Total revenue from NZME.’s digital and new ventures grew by 14 per cent in the 2014 financial year.

While agency and advertising continued to be a challenge in the publishing division, an integrated sales approach had made good progress, Mr Miller said.

The New Zealand Herald remained the country’s number one newspaper and while overall circulation for the publisher declined two per cent, the audience of nzherald.co.nz jumped up by 25 per cent, and mobile audiences were up 42 per cent year on year.

NZME.’s print agreement with Fairfax Media continued to deliver cost efficiencies while the success of New Zealand Herald NIMs had been expanded into regional mastheads.

Plans to float NZME. on the New Zealand Stock Exchange would be postponed for at least 12 months “when the benefits of the integration will be evident”, Mr Miller said.

The company now wholly owns six out of its seven businesses, having acquired the remaining  50 per cent of the Australian Radio Network and New Zealand’s The Radio Network and Hong Kong businesses Cody and Buspak respectively.

“During 2013, our priority was resetting APN. In 2014, we’re continuing to involve with greater momentum,” Mr Miller said. “We will continue to invest in growth media.”

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