German publisher Axel Springer 2009 net income falls 45 percent to $427 million

Axel Springer 2009 net income falls 45 percent

FRANKFURT — German publisher Axel Springer AG said Wednesday that net income fell 45 percent in 2009 to euro314 million ($427 million), with a drop in demand for newspapers and magazines mitigated only partially by new Internet revenues.

The publisher of Germany’s Bild daily, the country’s largest circulation newspaper, booked a net profit of euro571 million in 2008. Revenue fell 4.3 percent to euro2.6 billion from euro2.7 billion in 2008.

One of Europe’s largest publishers, Axel Springer, based in Berlin and Hamburg, counts more than 170 titles and operates in 35 countries.

It said the outlook for the current year is mixed — while the economy has not improved fully, low consumer spending and other factors, including the Internet, will probably cause the circulation of newspapers and magazines to fall further. The company said it could not raise prices from the current levels on many titles.

Advertising, however, could stabilize somewhat, it added.

Despite the circulation declines and flat pricing and advertising demand, revenue should remain stable and could actually increase slightly through its online operations of some 60 Web sites, the company said.

“We are making good progress with our strategy based on reach and are dynamically pursuing central issues such as paid content in the Internet,” chief executive Mathias Doepfner said in the report.

Through operational improvements, cost discipline and restructuring measures, operating profit could increase 10 percent for the year, Springer said.

Operating profit measured as earnings before interest, taxes, depreciation and amortization came in at euro334 million in 2009.

The company’s national newspapers division, including Bild and Die Welt, saw overall revenue decline 8 percent in 2009 to euro1.2 billion from euro1.3 billion in 2008, the publisher said.

National newspaper circulation revenue increased 1 percent in 2009 to euro632 million, but the increase was largely due to copy price increases. National newspaper advertising revenue declined more than 12 percent.

National magazines saw a 4 percent decline in circulation revenue for 2009 to euro359 million, while advertising revenue declined more than 20 percent.

The international print division reported a 24 percent drop in revenue to euro312 million, with eastern Europe reporting a sharp decline in advertising.

Meanwhile, the digital media segment was able to partially offset the declines in print with revenue increasing 24 percent to euro470 million.

Shares of Axel Springer were about 1 percent higher at euro86.92 in Frankfurt afternoon trading.

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