MEDIA and entertainment group Avusa on Thursday reported a 36% drop in diluted headline earnings per share for the full year.

The company said its second-half performance improved following a dismal first half, when diluted headline earnings per share plummeted 90%.

Avusa owns the Sunday Times and Nu Metro, and half of Business Day.

Diluted headline earnings per share fell to 111c for the year ended March 2012, from 174c a year ago.

Revenue increased 12% from R5,310bn to R5,963bn mainly as a result of the full-year inclusion of the Retail Solutions business unit, a printing company formerly known as Universal Hirt & Carter, acquired in 2010.

Profit from operations was down by R51m to R273m, from R324m in the prior year, which benefited from an additional R36m of 2010 Soccer World Cup revenue.

Headline earnings were R57m lower than the R194m reported in the previous year.

Acting CEO Mike Robertson said the group maintained a strong financial position at year-end, with net cash of R493m.

"The second half of the financial year showed a marked improvement on the first six months. Despite tough trading conditions persisting and depressed consumer spending, improvements in revenue and profit from operations were encouraging," Mr Robertson said.

The group's newspapers performed well overall, with the Sowetan, The Times and Sunday World all recording triple-digit percentage improvements in their operating profits, while Sunday World traded profitably for the first time since launching more than a decade ago. The return of banking and telecoms newspaper advertising spending is expected to have a positive effect, especially on the Sunday Times.

"The improved performance is mainly as a result of our intervention strategy and cost-savings drive gaining traction," Mr Robertson said.

Last week Mvelaphanda, the listed black-owned investment group, made a bid to acquire the entire share capital of Avusa at R24 a share, a premium on its price at the time.

neethlingt@bdfm.co.za