APN expects flat half year profit

PUBLISHING company APN News & Media expects a flat net profit result for the first half of calendar 2008 as it continues to battle challenging market conditions.

PUBLISHING company APN News & Media expects a flat net profit result for the first half of calendar 2008 as it continues to battle challenging market conditions.

The publisher of more than 120 newspapers in Australia and New Zealand said net profit before non-recurring items for the six months to June 30 would be "broadly'' in line with the same period last year.

Operating earnings for the half year would be marginally behind last year's result because of increased costs for investment projects, it said.

"APN continues to actively reduce its cost base through restructuring with headcount reductions of in excess of 200 already having been actioned,'' it said in a statement to the Australian securities exchange.

In the first half of calendar 2007, the Sydney-based company booked a net profit before non-recurring items of $73.2 million, and for the full year, it posted a net profit of $169.4 million, up 8 per cent on 2006.

APN chief executive Brendan Hopkins said the performance of the company's Australian business had improved slightly, while the New Zealand business was weaker.

"Within the result revenues for Outdoor and Australian Publishing businesses remain comfortably ahead of the prior year, whilst our New Zealand businesses are marginally behind,'' he said.

Mr Hopkins said forward bookings remain in line with expectations.

"Assuming no further deterioration in market conditions, APN expects to deliver another satisfactory year of achievement.''

APN said revenue for the first half, on a constant currency basis, would be about 2 per cent ahead of the prior year, despite generally tighter trading conditions.

At the company's full year result in February, APN departed from recent company practice and did not give guidance for calendar 2008 because of volatile market conditions going forward.

Those operating in the media industry have been affected recently by a downturn in advertising spending as the economy slows under the weight of higher interest rates, fuel and food prices.

Earlier this month, commercial television broadcaster Ten Network Holdings downgraded its full year earnings outlook as declining spending on television advertising threatened its bottom line.

At 12.49pm (AEST), APN shares were up one cent to $3.02.