AAP

West Australian Newspapers Holdings Ltd (WAN) says weekday circulation of its flagship newspaper will rise and the advertising market should make a full recovery in 2010.

WAN chairman Kerry Stokes says the advertising market should rapidly strengthen in 2010 after being pummelled during the global economic crisis.

"I firmly believe we'll be back at last year's level early next year," Mr Stokes told reporters after the media group's annual general meeting in Perth on Wednesday.

"The advertising market has only started to come back in the past couple of months and it's coming back strong."

WAN reported a fall in advertising revenue in its September quarter report on Tuesday, with employment classifieds the hardest hit.

But it expects this earnings stream will be boosted by major projects planned and under development in WA, including Chevron's Gorgon liquefied natural gas project.

Mr Stokes said WAN was in a strong position as WA's economy rebounded from the worldwide fiscal meltdown.

"We are already seeing a positive impact as the West gets back on track," he said.

"We're seeing positive signs of circulation against the trend at other newspapers across the country."

Chief executive Chris Wharton told shareholders he expected WAN would deliver a third straight quarter of year-on-year circulation growth for The West Australian newspaper's weekday editions during the December quarter.

However, Mr Wharton said Saturday numbers would be slightly down compared to the December quarter last year when special editions for the Beijing Olympics were snapped up, adding about 15,000 sales a day to circulation figures.

"We've made up those 15,000 or 17,000 copies on Monday to Friday but we just fell short on Saturday," he told AAP.

Mr Stokes, who is also the chairman of WAN's largest shareholder Seven Network Ltd, told reporters WAN may consider following Rupert Murdoch's News Corp down the path of charging for online news content.

"We endorse News and Rupert Murdoch's position on that," he said.

"We're not sure how the model is going to work ... particularly when organisations such as the ABC are always going to have the (free) news on their website.

"Finding a model that we can charge for is challenging and I guess it is something we'll all be looking at because we need to get there."

Mr Stokes also said he expected Seven would eventually creep up the share register of Consolidated Media Holdings Ltd (ConsMedia), giving it a stake similar to its 23.2 per cent interest in WAN.

Seven's stake is currently 20.96 per cent in ConsMedia, the 25 per cent owner of pay TV company Foxtel and 50 per cent owner of Premier Media Group, which produces the Fox Sports channels.

"We're going to end up with probably about the same shareholding in West Australian Newspapers and Consolidated Media," he said.

"They are particularly good companies for Seven to add to its investment portfolio."

Seven's interest in ConsMedia cannot be lifted until September next year, when a standstill agreement reached between Mr Stokes and ConsMedia deputy chairman James Packer expires.

The media moguls formed the truce after Seven staged a massive on-market buying spree of ConsMedia shares in September.

Mr Packer responded by upping the Packer family's stake in ConsMedia to almost 43 per cent as speculation about a possible takeover attempt by Seven intensified.

Shareholders approved all resolutions at WAN's meeting on Tuesday, including ratifying the appointment of Woodside Petroleum Ltd chief executive Don Voelte and Rio Tinto Iron Ore chief executive Sam Walsh to the board as independent non-executive directors.

Investors congratulated WAN's board for the company's recent performance.

WAN's former board ceded control late last year as Seven representatives and new independent non-executive directors took the helm.