SPH Q2 profit falls 22% to S$54m on flat operations, lack of year-ago investment sales

SINGAPORE Press Holdings' (SPH) net profit fell 22.3 per cent to S$54.1 million in its second fiscal quarter on flat recurring earnings and the absence of profits from sales of investments.

On a per-share basis, net earnings decreased to three Singapore cents for the three months ended Feb 29. The media and property group, which owns The Business Times, has declared an interim dividend of seven Singapore cents per share. That is the same that was paid out a year earlier.

SPH shares closed at S$3.99 on Tuesday before the results were announced.

SPH chief executive Alan Chan described the quarter as "a very difficult operating environment".

"Despite this, the group continued to turn in a respectable performance," he said in a statement.

Operating revenue from the media business experienced the sharpest decline, shrinking by 6 per cent to S$190.7 million as advertisement revenue slipped by 6.5 per cent or S$9.5 million.

Property revenue increased 0.9 per cent to S$61.1 million amid a depressed retail environment, while sales contribution from other businesses rose by 9.5 per cent to S$7.5 million on growth in the exhibitions segment.

Despite the lower revenue, SPH had actually eked out a 0.2 per cent increase in operating profit, to S$68.1 million, by cutting costs. Total operating expenditure fell by 5.4 per cent to S$196.1 million during the quarter.

But the bottom line showed a sharper year-on-year decline as net income from investments fell 62.4 per cent to S$7.2 million. In the year-ago quarter, net income from investments was S$19.2 million as SPH recorded profits from the sale of investments to fund its medium-term note redemption.

Looking ahead, Mr Chan said the outlook was "challenging, given the uncertain economic outlook and fast-evolving media landscape".

"Amid the challenging times, the group will continue its efforts to transform the media business and pursue growth opportunities," he added.