Massive losses for Australia's Fairfax Media

Struggling Australian media giant Fairfax on Thursday said its full-year losses ballooned to Aus$2.73 billion (US$2.87 billion), driven by huge write-downs as part of its restructuring plans. The grim result in the 12 months to June 30 compared with a loss of Aus$390 million in the previous year and sent its share price plunging 9.7 percent to 51 cents. Fairfax, which has newspaper, radio and digital interests, said the net loss included Aus$2.9 billion in write-downs, including a Aus$2.8 billion non-cash impairment charge and other significant items worth Aus$140 million. Stripping out one-time expenses and write-downs, underlying net profit fell to Aus$205 million from Aus$283 million a year earlier. Revenue fell nearly seven percent to Aus$2.33 billion. Like media companies worldwide, Fairfax has faced sliding print advertising and circulation revenues and the company is in the process of a major overhaul towards a digital future, slashing hundreds of jobs. The biggest write-downs were a reduction in the value of the company's mastheads and trade names from Aus$3.2 billion to Aus$1.23 billion. But chief executive Greg Hywood, who said he would give up half his Aus$840,000 bonus because of the difficult conditions facing the firm, defended the media company's prospects. "Fairfax Media has a sound and diversified business, as shown in the underlying results we have reported today," he said. "These results reflect a challenging trading environment. We continue to drive significant change through the business, consistent with our strategy, and we are responding to a stressed economic environment." The ailing company has been under pressure from its biggest shareholder Gina Rinehart, the world's richest woman, to reverse its fortunes and give her more influence. The mining mogul has been locked in a bitter row with Fairfax, which turned down her demand for three board seats over her refusal to sign the firm's charter of editorial independence. In response, Rinehart scaled back her holding from just under 19 to 15 percent last month. As part of its plan to address plunging newspaper revenues and circulation, Fairfax has previously announced it will slash 1,900 jobs and erect paywalls on its flagship titles. The Sydney Morning Herald and The Age in Melbourne will also shift from broadsheet format to a more compact, tabloid size and two printing facilities will be shut.