Fairfax Media hit by Domain slowdown as papers continue to slide

Fairfax shares have dived after it revealed that a sluggish listings market is dragging on its property platform.

Fairfax chief executive Greg Hywood gestures as he answers questions during a Senate communications committee public hearing in Sydney last month. (AAP Image/David Moir)

Fairfax Media said its revenues for continuing businesses have plunged by 6 to 7 per cent for fiscal year 2017 so far, as the company’s growth engine, Domain, suffered from a sluggish property listings market and investment in the real estate division also hit the bottom line.

At its annual general meeting, Fairfax (FXJ) will say Domain’s first-half earnings before interest, tax, depreciation and amortisation are expected to be lower than in the previous corresponding period as the key Sydney and Melbourne markets endure a hangover from the marathon federal election campaign.

New listings volumes to the end of October were down by 18 per cent in Sydney and down by 5 per cent in Melbourne.

The Domain slowdown comes as Fairfax’s newspaper divisions suffer from plummeting revenue.

The company’s Metro Media division, which houses The Australian Financial Review, the Sydney Morning Herald and The Age in Melbourne, saw revenue drop by 8 per cent for fiscal 2017 thus far, while the Australian Community Media business saw sales slip by 10 per cent.

“We will continue to reshape our publishing businesses while we drive new revenue streams,” Fairfax chief executive Greg Hywood said.

“In Domain, we have a strong growth vehicle that will continue to perform and increase value for shareholders.

“Each of our businesses is pursuing clearly defined objectives to maximise strengths and drive shareholder value.”

Fairfax’s share price has wilted 8.6 per cent to 74c at 10.24am (AEDT), against a broader maket decline of 0.2 per cent.