West Australian Newspapers shares fell more than 4% yesterday after the company produced a 15.4% per cent fall in first half net profit.
The company also cut interim dividend by 4c a share to 19c a share, from the 2009 payout of 23c.
Investors ignored the company’s claim that there has been a significant improvement in the underlying financial performance of the business.
The shares fell 33 to $7.17 after touching a low during the day of $7.13.
The media company told the ASX it earned a profit of $49.492 million for the six months to December 31, down from $58.496 million in the prior corresponding period.
Revenue fell 9.7% to $205.109 million for the company which is 24% owned by Kerry Stokes’ Seven Network.
WAN chief executive Chris Wharton said the results were "very pleasing".
"We have seen improving positive trends in both revenue and profitability throughout the half, with some weeks in November and December outperforming the corresponding weeks last year," Mr Wharton said in a statement.
"All major ad categories are performing well, with the positive sentiment being maintained in to the new calendar year."
Its results also showed net profit for the December quarter was $26.6 million, down 7.9% from a year earlier, but up 16% from the September quarter.
WAN said in commentary that total revenue, advertising revenue, and circulation revenue all fell. Advertising volumes were off 10% and the average rate per column centimetre was down 4%.
Despite claims from the company last year that the long sales slump for The West Australian had steadied, last week’s circulation figures for 2009 showed otherwise.
The Monday to Friday edition of The West Australian had daily sales of 188,211 in the three months to December 31, down 2.5% from a year ago and The Saturday edition saw a 2.7% drop in audited sales.
WAN said declining in circulation revenue reflected lower sales and increased distributor remuneration.
The improvement in the last quarter of the year can be seen from these comments about the performance of The West Australian, the company’s major asset.
WAN said the paper "recorded EBIT for the half of $68.0m.
"The result, whilst down 19.8% period on period, reflects a positive earnings trend. EBIT for the December quarter was $36.8m, up 18.2% on the results achieved in the prior quarter.
"Total revenue for The West Australian was $161.3m, down 11.0% on the corresponding period last year. Advertising revenue was down 13.9% and circulation revenue was down 5.7%."
