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Seven West shares down after H1 loss


Seven West Media shares have fallen more than seven per cent after the company said it had made a first half loss due to writedowns on its magazine and online properties amid a challenging advertising environment.

The writedowns pushed Seven to a statutory net loss of $109.3 million for the six months to December 29, compared with net profit of $163 million in the prior corresponding period.

Seven said it took a $195.2 million impairment charge on the carrying value of its magazine mastheads, licences and goodwill, a $60.2 million charge for Yahoo!7, and booked redundancy and restructuring costs of $5.3 million.

At 1110 AEDT, Seven shares was down 18 cents, or 7.14 per cent, at $2.34.

In percentage terms, the stock was the third worst-performing company on the S&P/ASX200 on Wednesday morning.

The Kerry Stokes-chaired media company owns The West Australian Newspaper, the Seven free-to-air television network, magazine publisher Pacific Magazines and is a joint-venture partner on the Yahoo!7 website.

Revenue across group fell 3.4 per cent to $977.9 million, Seven said.

Meanwhile, expenses rose 1.8 per cent to $727 million as the new Australian Football League broadcast contract kicked in.

Seven's television stations posted revenue of $666.1 million in the first half, up 1.6 per cent compared with the same time last year.

"Our television network is continuing to deliver revenue share well ahead of our leading viewer ratings," Seven chief executive Don Voelte said during the company's results presentation on Wednesday.

"Advertising is still thin and soft but, for whatever reason, things just feel better, better in the context of forward discussions with advertisers and their long-term commitment to live sports and big program franchises."

Seven said it expected television advertising to experience flat to single-digit growth.

By contrast, Seven's newspaper unit suffered a 14.9 per cent fall in revenue and magazines reported a 10.9 per cent slide in sales.

"We continue to see no changes to the advertising trends we see in our publishing companies," Mr Voelte said.

"Our magazines, and especially our newspapers, are experiencing fairly good results in circulation sales versus the competition, but are having to battle their margins on a day-to-day basis."

Seven said earnings before significant items, net finance costs and tax (EBIT) in the first half came in at $259.3 million, above company guidance of $250 million.

The company declared an interim dividend of six cents per share, fully franked.