Operating profits at Independent News & Media's New Zealand subsidiary, Wilson & Horton, rose by almost 9 per cent to 46.7 million New Zealand dollars (22 million) for the six months to end June, helped by tight cost control.
The newspaper and media company is confident that its full-year outcome will be ahead of last year, despite competitive conditions in a weak economy.
Describing the W&H results as "very satisfactory in difficult markets" Independent group finance director Mr Jim Parkinson declined to comment on speculation that Wilson & Horton will be used by Sir Anthony O'Reilly along with Independent's Australian subsidiary APN to launch a bid for the leading media organisation, the Fairfax Group.
"I cannot comment on speculation" he said, adding, "Independent has always admired the Fairfax operation."
Revenue growth in the current half is continuing in line with the first half, helped by the impact of cover price increases on some titles earlier in the year and steady circulation, according to Mr Parkinson.
But the advertising market remained "tough", he said. There are expectations that the New Zealand economy will improve in the current half and W&H's second half results will be helped by comparison with a weak second half last year, he explained.
The first half results show a sharp jump in interest costs which almost halved profits before tax and exceptional items to NZ$9.9 million.
The rise in the net interest charge followed the restructuring last year of foreign currency borrowings into New Zealand dollars, to eliminate adverse currency movements from the results.
Because New Zealand borrowing rates were higher than overseas rates in the first half last year, the impact was a NZ$12.5 million increase in the interest costs.
But the restructuring also meant the replacement of a first-half 2000 exceptional charge of NZ$30.1 million with an exceptional gain of NZ$1.4 million, resulting in profits before tax for the period of NZ$11.3 million, from a loss of NZ$11.5 million in the first half last year.
The latest results show a 4 per cent rise in turnover to NZ$236.4 million.
Strong cost control meant that operating margins improved to 19.7 per cent from 18.9 per cent. The group reported profits after tax for the period of NZ$6 million, compared with a loss of NZ$9.1 million for the last corresponding period.
