Fairfax Media chief executive Greg Hywood says trading conditions have not improved since August when the company delivered its fiscal 2011 results.
My Hywood told shareholders at the company’s annual general meeting in Sydney on Thursday that the diversified media group was facing an advertising market hit by poor consumer sentiment.
He said events in Europe as well as volatile equity markets and weak real estate prices had consumers concerned for their longer-term wealth.
This had reduced their willingness to spend and had depressed the advertising market.
“During the first four months of this financial year, we have seen a continuation of the trading that we reported in August, with revenues a little more than four per cent below the previous corresponding period,” Mr Hywood said.
“In Australia and New Zealand, consumer confidence levels remain subdued with consequential impact on most advertising categories but particularly retail and residential real estate.”
The company did not issue specific earnings guidance at its full-year fiscal 2011 results presentation in August.
At the time Fairfax unveiled a $650.7 million impairment charge, reflecting write-downs in the carrying value of its mastheads, customer relationships and goodwill.
In response to a question, Fairfax chairman Roger Corbett said he was unable to say if there would be further write-downs in the first half of the current year.
“Whilst at this stage I am not in a position to give any anticipation of what could occur, we constantly monitor that in terms of what’s happening in the market, the terms of growth in the market,” Mr Corbett said.
“There are a number of very clear, definable variables that we have to take into consideration.”
Mr Corbett told shareholders the company had made submissions to the current government inquiry into media and media regulation and welcomed ongoing consideration of the evolving role of high-quality journalism in our democracy.
However, he said it would be a “terrible mistake” to limit the role of a free press.
“While any system can be improved, we believe that the core attributes of the current regime – under which journalists have the freedom to report any issue without fear or favour – is as fundamental to our strong democracy today as at any previous time,” Mr Corbett said.
“I don’t think I need to spell out the dangers that may emerge if this ever ceased to be the case.
“We would regard it a terrible mistake if any change was proposed that limited the role of our free and independent media.”
Mr Hywood said major acquisitions were “not currently on our agenda”.
The company recently shelved plans to sell its metropolitan radio stations due to a lack of acceptable offers.
Meanwhile, the partial float of its NZ online auction company Trade Me was priced at $NZ2.70 a share, at the top end of the indicative range.
Fairfax closed down half a cent at 92.5 cents.