SPH expects profit to drop in FY2020
The group’s print ad revenue plummetted 51.4% in Q3 FY2020.
Singapore Press Holdings' (SPH) operating profit for the year ending 31 August is expected to be significantly lower than the $187m recorded in FY2019 due to the impact of the pandemic, according to a corporate presentation.
The group’s business segments have recorded declines in revenue, with print ad revenue down 51.4% YoY in Q3 FY2020. Meanwhile, its display, classified, and total print ad dropped 55.8%, 42.7%,and 30.4% YoY, respectively, whilst 9M digital ad revenue declined by 3.7% YoY due to circuit breaker measures and weaker economic sentiment
However, its overall circulation rose 9.5% YoY with rise in digital subscriptions. Total digital revenue continues to improve, with 9M FY20’s digital revenue growing 8.5% YoY. Digital engagements also led to higher digital subscriptions with 13,800 additional digital subscriptions registered in Q3 FY2020 compared to 12,900 in Q2.
SPH has also launched Zaobao Rewards programme which registered 30,000 sign-ups.
On its retail segment, the group notes that its rental reliefs have helped retail tenants tide through the pandemic. The Phase 2 reopening is said to have a positive impact on the group, but footfall has yet to recover to pre-pandemic levels and tenants have to operate with new social distancing measures
The group also notes its healthy cash balances of $810m with no loans due until June 2021. It has also unlocked value in AXA Tower, divesting 5.29% stake for $33.2m against original investment amount of $19.3m in 2015. SPH has also entered into JV with Keppel to develop a data centre at 82 Genting Lane to grow recurring income.
