Trade Me accounts reveal parent company loans
Online auction company Trade Me lent its Australian parent Fairfax Media $192.7 million in 2010 and paid out $220 million in dividends in 2011, according to just-released financial statements.
Trade Me is about to file a prospectus for an initial public offering that will pull in $529.5 million with Fairfax netting about $363 million with $166 million of new debt applied to Trade Me.
The financial statements show Trade Me had receivables due from Fairfax of $192.7 million in 2010, which reduced to $39.15 million in the year to June 2011.
Trade Me recorded a profit of $69.7 million in 2011, up from $63.6 million in 2010.
Total revenue came in at $128.8 million, compared to $114.4 million in 2010.
Total assets, including the $39.15 million due from Fairfax, were $61.97 million, with liabilities of $42.1 million.
Total equity as June 30 was $19.8 million after paying out $220 million in dividends to Fairfax.
Fairfax Media made an after tax loss of $A400.9 million in the year to June 2011 after writing down the value of its mastheads, customer relationships and goodwill by $A650.7 million.
Fairfax bought Trade Me in 2006 for $750 million.
Returns from the IPO and the dividend will give Fairfax a full carry on its investment and still retain 66% of Trade Me.
Fairfax announced yesterday an offer price of $2.70 per share had been set, with 134.6 million, or 34%, of Trade Me's shares to be sold.