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Australia's Fairfax Media warns of US$759m writedown citing tough market
[SYDNEY] Australian newspaper publisher and radio broadcaster Fairfax Media said on Monday it will make nearly A$1 billion (S$1 billion) in impairment charges for fiscal 2016 to reflect "market realities".
The publisher of the Australian Financial Review, the Sydney Morning Herald and other newspapers said in a statement it expected to make impairment charges totalling A$989 million when it reports full-year earnings on Aug 10.
The Sydney-based company was previously expected to post a net profit of A$145 million for the year to June 30, according to the average forecast of 10 analysts polled by Thomson Reuters Starmine.
Australia's print media companies, like their overseas peers, have been reporting huge writedowns in recent years as advertising revenue shrinks to reflect an exodus of paying readers to cheaper alternatives online.
Fairfax said the impairment charge followed its move to create a separate reporting segment for its real estate advertising unit, Domain Group, previously a significant contributor of earnings to the overall company. "The new segment presentation ... provides a clearer picture of the operational performance of the business as it transitions to a new sustainable publishing model over time," Chief Executive Officer Greg Hywood said in the statement.
Fairfax shares were down 1.4 per cent while the broader market was up 0.3 per cent in early trading.