APN, the Australian news and media group part-owned by Independent News & Media, expects to deliver earnings growth of at least 5 per cent this year.

The company, which held its annual meeting in Australia yesterday, said results for the first four months of the year were in line with expectations.

"Whilst it is too early to predict a fifth consecutive year of double-digit earnings growth and, given a continuation of current conditions, the board believes that further significant earnings growth for the year of at least 5 per cent looks likely," chairman James Parkinson said.

He noted that the company, which is 40.5 per cent owned by Independent, enjoyed a strong trading performance in the first half of 2005 and is trading ahead of that at present. Growth is expected to accelerate against the prior year from now on, he added.

At the meeting, Mr Parkinson also voiced APN's support for the Australian government's proposals for media reform.

Asked about reports that Independent could be facing tax problems in New Zealand, a spokesman said APN was satisfied it was tax compliant.

The issue relates to the sale of Wilson & Horton in December 2001, a deal involving the sale and leaseback of the newspaper titles that provided APN with a tax shelter that has since come to the attention of the New Zealand tax authorities.

APN remains engaged in a tax audit in New Zealand, but has said that it is "satisfied that its treatment of the New Zealand Masthead Licensing Agreement complies with all relevant legislation".

But, if the New Zealand authorities were to find a problem with the tax treatment, it looks like Independent could be faced with the bill, with some estimates putting the liability at up to €50 million. This is because it provided APN with a full indemnity covering all aspects of the Masthead Licensing Agreement, including its financial benefits, when it sold Wilson & Horton to the Australian company over four years ago.