24 Feb 2009

Classified advertising market weak for Fairfax

5:27 am on 24 February 2009

Fairfax Media expects the classified advertising market to remain weak for the rest of the financial year.

Underlying profit for the Australasian media group fell 23% in the six months to December, as growth in its online businesses failed to offset declines in publishing.

Revenue rose 0.5% to $A1.45 billion in the first half.

Fairfax posted a loss of $A365.27 million in the six months to December due to a impairment of goodwill and a number of one-off charges.

When those items are excluded, it made an underlying profit of $A156.7 million.

Publishing operations across the group suffered due to falling advertising revenues, with its New Zealand arm showing the most declines.

Fairfax Media New Zealand, which owns The Dominion Post and the Sunday Star Times newspapers reported a 15% drop in advertising income and an 11% drop in total revenue.

Total costs were reduced by 4%, largely due to a restructuring announced in August which involved cutting about 160 jobs.

Trade Me was again the standout performer in New Zesaland, with its earnings increasing 17% to $NZ38.2 million.

The Fairfax says classified advertising is expected to remain weak in both countries for the remainder of the financial year. However, the benefit of last year's cost cutting will help provide a buffer to the weak market conditions.