MONTREAL - Astral Media's (TSX:ACM.A) advertising revenues are showing gradual signs of improvement, but Canada's largest radio company doesn't expect a full recovery until next spring.

"What's encouraging is that at least there's much more activity presently than there has been for the last six to nine months," chief executive Ian Greenberg said Tuesday during a conference call with financial analysts.

Greenberg said he's "reasonably optimistic" about seeing some early increases and expects the company will be well-positioned to benefit from a rebound starting halfway in its fiscal year, which ends in August.

"For the second half of the year we remain more confident about getting back to some reasonable growth rates."

The economic downturn has squeezed Canadian media companies that rely on advertising spending. Astral has endured, aided by its growing television subscriber base and a healthy radio market in Quebec.

The Montreal-based company reported Tuesday record full-year revenues as it gained full benefit from the 2007 acquisition of Standard Radio.

However, total revenues decreased by five per cent during the fourth quarter to $219.4 million as an eight-per-cent gain from television subscribers partially offset a 14 per cent drop in total advertising.

A net $317.5-million non-cash writedown of the value of its radio licences - primarily those acquired from Standard Radio - caused the television, radio, outdoor advertising and interactive media company to lose $273.6 million, or $4.87 per share, for the period ended Aug. 31. That compared to a 68 cent profit a year earlier when profits approached $39 million.

Excluding the charge, earnings increased seven per cent to $43.9 million, or 78 cents per share, from $40.8 million or 72 cents a year earlier.

For the full year, the company lost $158 million, reversing a $177-million profit in 2008. On an adjusted basis, earnings from operations increased six per cent to $159.5 million.

The results beat expectations. Analysts surveyed by Thomson Reuters had forecast 68 cents of adjusted earnings on $221 million of revenues.

Analyst Adam Shine of National Bank Financial said Astral's streak of 52 consecutive quarters of adjusted earnings growth was impressive even without the benefit of an extra week of business in 2009.

"Given the fourth-quarter beat, there appears to be upside to our fiscal 2010 and 2011 estimates," he wrote in a report.

Astral's results were partially driven by higher outdoor advertising margins and lower costs. But the company said the margin improvement was an aberration and should return to normal levels.

Meanwhile, Astral said it is interested in acquiring some or all the specialty channels owned by CanWest Global Communications (TSX:CGS) should the company decide the sell them. However, Astral would not buy CanWest's conventional assets to get the specialty ones.

"The exciting part would be if in fact we were able to acquire the amount of specialty channels in the English language that we would need in order to have the proper infrastructure in Toronto," Greenberg told analysts.

Astral reduced its debt by $120 million to $695 million as of year-end, and made another $10 million payment in September.

Greenberg said he expects any purchase of CanWest would require negotiations with bondholders and Goldman Sachs, which has a claim on the specialty TV channels it helped CanWest purchase from Alliance Atlantis.

On the Toronto Stock Exchange, Astral's shares closed at $32.60, up 42 cents in trading.