Avusa weathers the storm
Say it with a sting.....
Published:Jun 13, 2009
AVUSA, the media and entertainment group that owns the Sunday Times, Sowetan and Daily Dispatch, said on Friday that headline earnings for the year ended March were expected to be between 235c and 245c a share.
Avusa’s results are scheduled to be released on or around June 25.
“Last year’s continuing headline earnings a share was about 290c, so it will be about 16% down on last year,” said a media analyst, who declined to be named.
“The newspapers, especially the Sunday Times, are probably doing the best of the lot within the group, but others would be struggling.”
He said the media segment would probably perform better than the rest of the group, even though it has been hit by declining advertising.
Earnings have probably been helped by lower costs, especially in terms of renegotiated printing contracts, when Avusa moved printing to Naspers from Caxton last year, he said.
“This would have been worth tens of millions of rands in terms of savings.”
He added that the results, though behind consensus, would be “pretty good” in this environment.
The calculation of the current period’s attributable earnings a share includes a profit of R62-million realised on the sale of Avusa’s Nigerian and Kenyan interests.
A fund manager said the market would be looking to see whether the group had optimised printing arrangements in light of uncertainty about its relationship with the cash-strapped printing joint venture with the Independent Group. Independent has not been reinvesting in its printing presses and the market will look for clarity on Avusa’s relationship with that group going forward.
“They (Independent News & Media Group) are in the wars and have to reach a compromise with bondholders,” said the fund manager, referring to the embattled European empire founded by Irish tycoon Tony O’ Reilly, the parent company of the Independent News & Media Group South Africa.
Comments by Sonny
The sign of the times.....
They should have kept their work horse, REPORTER!
Labels: Avusa in trouble.