Wilson & Horton, the New Zealand subsidiary of Independent Newspapers, has recorded a 7.6 per cent fall in operating profit to 85 million New Zealand dollars (€41.3 million) in 1998. The decline occurred before unspecified redundancy costs.
The redundancies of more than 200 people will lead to a NZ$8 million reduction in the costs of the New Zealand Herald this year, said chairman Mr Cameron O'Reilly. "The effects of this are already beginning to flow through in 1999 but will have the most significant impact in the second half."
He told The Irish Times that the only disclosed figures for the New Zealand company were those contained in yesterday's press release - operating profit and sales - as these were the only ones allowed prior to the publication of Independent Newspapers' results for 1998.
Sales of NZ$438 million (€212.7 million) from continuing operations were "flat", he said. However, the New Zealand Herald had "gained significant market share in the competitive national display advertising market, leading to a lift in both volumes and revenues". But a rise in the price of newsprint, together with an increase in the cost of imported paper, "affected the company's commercial printing operations".
He described the operating profit as "encouraging given the depressed conditions which affected the New Zealand advertising market in the second half of last year, and compares favourably with the performance of Wilson & Horton's newspaper and television peers".
The New Zealand Herald had been losing circulation but Wilson & Horton's chief executive officer, Mr John Sander, said this has now been "stabilised". He said new initiatives had been introduced, including a refocusing on the key Auckland market. "A new three-year plan to regain circulation is being finalised through the new product sales and marketing department."
Mr O'Reilly said there was an urgent need for the newspaper to have "an aggressive approach to winning market share" and the new management team was now being "galvanised into action".
There were early signs that confidence had returned to the New Zealand economy, he said.
