Media company APN News & Media is set to sell-off its regional media arm, Australian Regional Media (ARM) due to “challenging environments”.

Within the company’s calendar year financial results, CEO Ciaran Davis said the company has commenced the selling process, despite claiming the regional sector was doing well.

“ARM is operating in a challenging environment with all publishers facing the same tough headwinds, however, there continue to be positive results delivered within the business,” he said.

“Despite having reduced the cost base of ARM by $40m over the past three years, the business has maintained stable audiences and grown its digital footprint through delivery of greater digital content. Digital subscriptions and the development of other new revenue streams are helping position ARM for the future.

“Pursuing this digital growth strategy will, however, require further investment, particularly in fast‐
tracking the digitisation and monetisation of its loyal and local audiences. APN has been a long term supporter of regional publishing in Australia however, our future investments must remain focused on growth assets and opportunities.

“We have therefore commenced a process to divest ARM. New ownership should give ARM the flexibility to invest where required, to continue to providing quality news and content to its audiences, without having to compete for APN’s capital.”

The company’s results for the 12 months ending December 2015 show revenue was up one per cent to $850 million, EBITDA was up one per cent too to $166.2 million.

The cost savings projection of $25 million was exceeded with the savings put back into the business.

“APN achieved significant progress and transformation in 2015. Operating in a competitive and tough media market, APN delivered revenue and EBITDA growth, strong cashflows and exceeded its 2015 cost savings program,” said Peter Cosgrove, APN Chairman.

“APN has a unique and diverse portfolio of assets across different sectors and geographies. Each business has its own opportunities and challenges. Our focus is to prioritise strategic investments on growth areas within the portfolio to deliver the greatest shareholder return.”

eThe radio arm of the business, ARN – Australian Radio Network, maintained a strong position in the market, with Adshel, the company’s out of home company, also performing well.

CEO Davis added in a statement: “In 2015, APN’s businesses continued to integrate, digitise and diversify. Operationally, we have cemented our positions as leaders in our respective fields in today’s fragmented and competitive media markets.