Fairfax Media's half-year profit has almost halved, but the company says it is gaining momentum.

The publisher of mastheads such as The Sydney Morning Herald and The Age made $193.8 million after tax during the six months to the end of December.

That was down 49.8 per cent compared to the same period the year before.

However, the company's underlying pre-tax profit, which excludes one-off gains and losses, rose 2.3 per cent to $178 million, with underlying net profit up 48.5 per cent to $86.4 million.

Fairfax achieved that despite a continued 1.2 per cent fall in revenue.

The company's chief executive Greg Hywood says it is a result that reflects the cost-cutting efforts across the business.

"It is a credit to the skill and resilience of everyone at Fairfax that the company has recorded its first year-on-year increase in underlying EBITDA [earnings before interest tax depreciation and amortisation] for continuing businesses since June 2010," he noted in the report.

"We have shown a determination to transform the business through cost reductions and driving new revenue streams. It is these strategies that underpin a half-year result that's starkly at odds with the conventional wisdom that traditional media companies face a bleak future simply because reductions in print advertising cannot be immediately offset by increases in digital revenue."

Mr Hywood says Fairfax has now achieved cost savings worth around $260 million a year, but more cuts may be ahead.

"We continue to identify further opportunity for operational cost savings," he added.

Fairfax has moved to a net cash position of $80 million from a net debt of $154 million as at June 30 last year.

Shareholders will be paid an interim dividend of 2 cents per share, fully-franked.

Investors were very pleased with Fairfax's result, driving its shares up 22.7 per cent to 87.7 cents.