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SPH profit plummets by 20.4% to $321.7m
Dipping investment property valuation dragged the bottom line.
Hefty one-time gains cannot save the media organisation this time around, as lower fair value gains on its investment properties are compounded by the drear outlook in its advertising revenues.
Adding salt to the wound, SPH sustained the absence of a $52.9m divestment gain from the partial sale of 701Search to Telenor last year.
According to a report by OCBC, though media numbers were expected to dip for SPH, this year’s results dropped steeper than anticipated.
Meanwhile, there seems to be no let up on SPH’s advertising woes, as total newspaper ad revenues fell by 8.4% YoY.
“We understand from the group that they have been focused on managing the cost base and as a result, key cost-side items, including material and production costs, staff costs and other operating expenses all showed credible YoY declines,” OCBC said.
“In particular, the cost of newsprint fell 16.1% while other materials, production and distribution costs fell 8.9%,” they added.
On its real estate segment, on the other hand, SPH’s profit grew by 17.3%, with a maiden contribution from Seletar Mall, while both the Paragon and The Clementi Mall also chipped in with higher rental income.
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