Avusa posted a sharp fall in first half profit, the media company said today. It blamed the drop largely on softer margins from reduced advertising revenues, it said in a statement following the release of its results for the six months ended September 30.

Revenue dropped 5% from R2.330 billion to R2.202 billion, while gross profit dropped by R91 million compared to the same period last year. "The Avusa Media business mirrored the recessionary climate, delivering 20% lower advertising revenues. The retail, entertainment, and books and maps businesses saw no profitability growth from reduced consumer discretionary spending."

The success of group-wide cost-cutting initiatives had resulted in operating costs being held at the prior year's level inclusive of general overhead inflation, digital developmental costs of R10 million and unrealised foreign exchange losses of R14 million.

CEO Prakash Desai forecast the current "softer" trading would continue until the end of the current financial year. The company that owns The Sunday Times, Business Day, Financial Mail and the Herald, recently shut down its Weekender newspaper. -Sapa