The company's media assets, which include The Times and the Sunday Times, rely heavily on advertising spending, which took a severe knock during the recession and financial crisis.
The media unit accounts for about 42% of the group's total revenue.
Releasing its financial results for the year to the end of March yesterday, Avusa said advertising revenues slipped 17%, resulting in the 39% decline in operating profit to R247-million from R405-million.
Despite the depressed advertising sales, Avusa said that there were signs of a recovery in spending on advertising.
Prakash Desai, chief executive of Avusa, said that though advertising revenues remained under pressure across the newspaper and magazine divisions, there was an improvement in the last quarter of 2009 as marketers began returning to print.
"We expect that recruitment advertising, hard hit by the slowdown in the economy, will be the last sector to recover," Desai said.
He said the group expected the economy to strengthen and believed the soccer World Cup would contribute to this.
Full-year diluted headline earnings dropped 38% to 149c a share from 242c previously. Revenue from continuing operations decreased 4% from R4.9-billion to R4.7-billion.
Avusa said the positive trend line of its start-up daily newspaper The Times continued. The annual losses inevitably incurred in such start-ups have fallen sharply each year.
The Times reported a loss of R13-million for the financial year to March 2010 from a loss of R25-million in the corresponding period last year. The title lost R39-million in 2008. It has benefitted from growth in classified advertising and strong support from retailers.
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