Fairfax pleased with strong showing from NZ stable

By SIMON HENDERY and REUTERS

Transtasman publisher John Fairfax Holdings has declared itself increasingly optimistic about growth prospects for its newly acquired New Zealand operation.

Fairfax yesterday reported its June-year profit after tax had more than doubled - to A$125.5 million ($142.62 million) from A$53.66 million the year before - and cited a strong performance from its New Zealand newspaper stable.

Group earnings before interest and tax increased 23.1 per cent to A$201.3 million for the year.

The Australia-based company bought Independent Newspapers' New Zealand publishing business for $1.2 billion in June. The INL stable includes The Dominion Post and Christchurch Press newspapers.

In Australia, Fairfax publishes the Sydney Morning Herald and Melbourne's Age.

Chief executive Fred Hilmer described yesterday's result as "a sustained performance that we are committed to continuing" which had involved a successful early performance from the New Zealand side of the publishing business.

"We are increasingly optimistic that we have bought very good assets at a fair price in what in media terms is an attractive market."

Hilmer said that "barring unforeseen circumstances, we expect to continue earnings growth in 2004 [financial year]".

He said that compared with last year, trading in the first 10 weeks of the current financial year had been "generally steady" in Australia and "stronger" in New Zealand.

Fairfax expects earnings before interest, tax, depreciation and amortisation from its New Zealand operations to top $130 million this financial year, up from $119 million.

Fairfax NZ chief executive Brian Evans said natural synergies were beginning to flow through as Fairfax worked on breaking down the silos to better integrate the group's various New Zealand business units.

Asked about the impact of the launch later this month by Herald publisher APN of a free weekly newspaper, the Aucklander, Evans said his company remained Auckland's dominant community newspaper publisher.

"They [APN] are number two in the marketplace. They obviously want to become stronger than what they are. They're obviously having a go and that's fine. We're very comfortable with that."