SPH Q1 net profit rises 165% to $221.6m - Jan 07, 2005 (BT)

BackJan 07, 2005

The Straits Times / The Business Times News On SPH

SPH Q1 net profit rises 165% to $221.6m

It is cautious about operating performance for current year.

By Michelle Quah
Jan 07, 2005
The Business Times

BOOSTED by the income from the sale of a stake in telecoms company StarHub, Singapore Press Holdings (SPH) yesterday posted a 165 per cent year-on-year rise in net profit to $221.6 million for its first quarter ended Nov 30, 2004.

And citing economic and geopolitical uncertainties, the media group said it is cautious about the operating performance for the current financial year.

SPH recorded group investment income of $152.7 million - up from $14.7 million in the previous corresponding quarter - $128.5 million of which arose from the disposal of a substantial portion of its stake in StarHub.

Q1 earnings per share rose to 14 cents from 5 cents in the previous Q1 while net asset value per share increased to $1.08 as at end-November from $0.93 as at end-August.

The group's Q1 profit from operations rose 0.6 per cent to $95.9 million.

Group turnover for the three months increased 10.4 per cent to $265.4 million, boosted by revenue from its core newspaper and magazine operations, which rose 10.6 per cent to $230.2 million.

Also contributing to the overall improved performance of this segment was the acquisition of the Blu Inc media and publishing business.

SPH said the group's newspaper advertising revenue was satisfactory, given some concern over slower-than-expected economic growth.

SPH's broadcasting arm, SPH MediaWorks, incurred an operating loss of $13.1 million in Q1, up from $10 million in the previous corresponding Q1.

SPH said this was due to the production of local programmes and the speeding-up of the use of acquired content prior to the completion of the merger of its free-to-air television broadcasting business with MediaCorp.

The group's operating expenses rose 16.6 per cent to $172 million as newsprint cost went up 18.7 per cent and staff costs rose 11.5 per cent due to increased headcount following the acquisition of the said Blu Inc business and expansion of the group's existing magazine business.

Commenting on the outlook for the rest of its financial year, chief executive officer Alan Chan said: 'The group's newspaper advertising revenue is expected to move in tandem with the expected slowdown in economic growth for the year 2005. For the group's broadcasting business, there are operational losses for the period prior to the completion of the merger of the free-to-air television broadcasting business, retrenchment costs and potential charges arising from the exercise.

'In view of the expected slowdown in economic growth and uncertainties over the economic and geopolitical environment, the directors are cautious about the operating performance of the group for the current financial year.'

SPH shares, which underwent a share split and capital reduction exercise last year, yesterday closed six cents up at $4.68.