Domain devours Fairfax

Advertisement

Fairfax’s full year results are out today to great fanfare and for those that detect a positive real estate bias in its many mastheads (not I!), there is plenty of grist for the mill here.

Overall Fairfax posted a big bounce in profits to $224 million from last year $16 million loss. But a quick look under the bonnet shows that this firm remains one sick puppy. The traditional backbone of the business, print ads, is collapsing at an astonishing rate:

Capture

The offsets to this dramatic collapse are also disappointing. Print circulation revenue held up but if the rags aren’t carrying ads then that’s not going to matter. Other digital revenue – which includes stuff like RSVP and Oasis – fell sharply. Really, this is the division that should be powering with SEEK, Carsales etc all in the bag, but isn’t thanks to Fred Hilmer. The rise in digital circulation is the new pay walls at the metros dailies. Seems to be going OK.

Advertisement

Digital advertising rose a bit but the headline results hides big falls from regular sources. That’s because of this:

Capture

Domain revenue rose $20 million so everything else must have fallen $10 million. Moreover, Domain profit now accounts for 25% of group profit and 40% of Australian profit. That doesn’t account for the real estate advertising in the dailes or the community papers, either.

Advertisement

I’m sure Fairfax is fair and balanced in its editorial but it sure ain’t the case in its financials!

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.