Tough trading in media world: Fairfax

Newspaper publisher and multi-media owner Fairfax Media sees tough trading conditions for some time but says it is better prepared than ever to take advantage when recovery occurs.

Chairman Ronald Walker told shareholders today it was a time of serious economic challenge not experienced before.

In WA, Fairfax own radio stations 6PR and 96FM, which the group purchased from Southern Cross Broadcasting more than six months ago.

"Current world economic conditions are difficult," Mr Walker told the annual general meeting today.

"We foresee tough trading conditions for some time."

But Fairfax Media was well prepared for these times and its future prospects were good, he said.

"Fairfax Media is better positioned than at any other time in its past 177 years to meet the challenges we are facing right now, and to continue on a sound strategic course for the future.

"When there is recovery and there will be we are well positioned to take full advantage of it."

Chief executive David Kirk said there has been continued weakness in advertising markets and EBITDA in the first quarter of the current financial year was below the same period of fiscal 2008 by mid-teen percentages.

"However, trading performance has improved in the second quarter," Mr Kirk said.

"EBITDA in the second quarter to this point is below the same period last year by mid single digit percentages.

"This is not a result of strengthening revenue.

"This improvement is driven by strong cost reductions.

"We are confident of continued strong cost performance across the group."

Mr Kirk said it was very difficult to predict trends for the crucial Christmas trading period and beyond.

"However, Fairfax is better positioned today than at any time in its recent history to face these challenging times."

Mr Kirk said Fairfax Media was not longer "The Age/Sydney Morning Herald company".

"That company is long gone."

The earnings from those newspapers are now less than 20 per cent of the company's total earnings of about $830 million at the EBITDA line.

Earnings from online businesses are 15 per cent of the total and growing rapidly, he said.