Kerry Stokes’ Seven Group Holdings will be happy; the partly-owned associate West Australian Newspapers is more than doubling final dividend after a 10% rise in profit for the 2010 financial year.
Seven Group Holdings inherited the 23.8% stake in WAN that Seven Network holds in the big merger of the Stokes interests earlier this year.
West Australian Newspapers Holdings yesterday reported net profit for fiscal 2010 of $96.223 million, up 10.3% from 2008.
Normalised net profit, after taking account of the personnel restructuring costs of $13.6 million last year, was down by a marginal 0.9%.
WAN declared a final dividend of 26c fully franked, up from 10c fully franked.
The payout brings total dividends for the year to 45c fully franked, up from 33c in 2009.
Seven Group Holdings would be entitled to around $14.6 million of the $61.38 million in dividends.
WAN CEO Chris Wharton said the lift in final dividend "reflects confidence in the recovery and position of the Group".
WAN’s revenue was down 2.26% to $409.174 million.
That means the net profit margin is just under 25c in the dollar, a fat margin in any environment.
Mr Wharton said in the statement yesterday that "to have finished the year more or less on parity with the prior financial year is a strong result".
"At the end of quarter three, our result reflected an eight per cent decline for the nine months.
"To get to parity, we needed period on period growth of 27 per cent in quarter four.
"We set this target internally and I am very happy we have been able to achieve it."
Mr Wharton said he was pleased by the performances of all the group’s divisions.
"Revenue levels are solid and costs remain under control, our Regional radio and newspaper groups both achieved year on year growth, as did Quokka.
"Our Digital group recorded a loss of $1.8 million, down from $5 million the prior year," but Mr Wharton said he was "pleased that our Digital group has achieved weekly profits on a number of occasions during the fourth quarter (and) we continue to focus on improving the performance in this business."
He said WAN had taken decisions during the last year that had improved its cost base.
"We continue to strive to improve the quality and sales of our products."
The company said its flagship publication, The West Australian newspaper, suffered a 7.6% fall in earnings before interest and tax (EBIT) in fiscal 2010 to $131.8 million.
But EBIT from regional publications rose 4.4%, from radio rose 8%, and from digital publishing improved 64.7% to that loss of $1.8 million.
Overall earnings fell 2.6% to $150.8 million.
Circulation revenue for The West Australian fell 5.4%, to $66.5 million as sales dropped, while overall ad revenues dropped 2.6% to around $304 million, thanks to the tougher trading times in the first half of the year.
"Internal data indicates the June quarter circulation audit will reflect a positive year on year Monday to Friday circulation, and strengthening, although still negative period on period, Saturday circulation," the company said yesterday.
Despite the solid looking result and higher payout, WAN shares slipped 17c, or 2.4%, to $6.85.
