SYDNEY - FAIRFAX Media, publisher of the Sydney Morning Herald, on Wednesday named Brian McCarthy as chief executive, an appointment that was expected after the previous CEO resigned in the face of shrinking advertising revenue and a collapsing share price.

Mr McCarthy, who also becomes managing editor, was Fairfax's deputy CEO and head of the publisher's Australian operations. He was the former managing director of Rural Press, which merged with Fairfax earlier this year after Australia relaxed media ownership rules.

'Mr McCarthy is the right person with the right experience at this time to run the company,' Fairfax Chairman Ronald Walker said in a statement.

Mr McCarthy inherits a company that is struggling with falling revenue, job cuts and a share price that has dived nearly 70 per cent this year.

His predecessor, David Kirk, a former captain of New Zealand's All Blacks rugby team, stepped down last week after three years at the helm of the company. He gave no explanation for his resignation.

Fairfax owns more than 300 newspapers, 50 websites and 15 radio stations. In Australia, it publishes The Age, The Sydney Morning Herald and The Australian Financial Review, among others. New Zealand mastheads include The Dominion Post and The Press.

The company also warned shareholders Wednesday that their dividend payout for the first half of 2009 would fall as the company retained funds to pay back debt. It has cut its dividend payout ratio to about 20 per cent of profits from 80 per cent for its March 2009 interim dividend.

Despite this, Fairfax said it was well positioned to manage the economic downturn.

Shares in Fairfax Media are down 68 per cent this year, compared with a 44 per cent slide in the overall market. They rose briefly after the announcement but closed unchanged on Wednesday at AU$1.505 (S$1.48). -- AP