It has been "a year of resilience" for Singapore Press Holdings (SPH), with the media and property firm emerging relatively unscathed from tough market conditions, said chief executive Alan Chan yesterday.
Net profit for the full year to Aug 31 fell 20.4 per cent to $321.7 million, mainly because of a lower fair value gain on its investment properties and the absence of a one-off gain made in the previous year.
Stripping away those special items, SPH's operating profit, which represents the recurring earnings of its media, property and other businesses, rose 1.3 per cent to $353.5 million.
Total revenue slipped 2.1 per cent to $1.2 billion. The weak economic environment put pressure on the firm's media business, where operating revenue dropped 6.3 per cent to $902.5 million.
Advertising revenue declined 7.4 per cent while circulation revenue slipped 5.4 per cent.
"We have been hit on two fronts. First, there has been a move towards digital, so (the newspaper business) on its own is a challenge," Mr Chan said at a media briefing.
"It has been exacerbated by the Singapore economy - if you look at the property sector, it's really in the doldrums, so ads are not coming in. There are hardly any IPOs (initial public offerings) in the last few months."
AT A GLANCE
NET PROFIT: $321.7 million (-20.4%)
REVENUE: $1.2 billion (-2.1%)
FULL-YEAR DIVIDEND PER SHARE: 20 cents (-4.8%)
But Mr Chan noted that the media business has made various efforts to boost revenue and this has already shown some results.
"We have actually been seeing growth in our digital revenue, which is quite encouraging... We have revamped all the newsrooms and are putting a lot of effort into expanding our digital space."
SPH's property business was a bright spot, with revenue climbing 12.6 per cent to $230.8 million.
Turnover was boosted by contributions from The Seletar Mall, which commenced business during the financial year, and higher rental income from Paragon and The Clementi Mall.
SPH is on the lookout for more opportunities to grow its property business, noted executive vice-president for corporate development Deborah Lee.
"We will be engaging in land bids, but we also have to be very selective in our choices... I think we remain focused on the retail segment but we may look at mixed developments with a retail component."
Revenue from SPH's other businesses, which include exhibitions, fell 6.4 per cent to $43.8 million.
Earnings per share for the year dropped to 20 cents, from 25 cents the year before, while net asset value per share fell to $2.24 at the end of August from $2.28 a year ago.
Mr Chan said that overall, the 2015 financial year marked a year of resilience for SPH. "Despite the tough market conditions, the group has delivered a creditable performance with recurring earnings maintained year on year."
That said, the operating environment will likely remain challenging for the year ahead, he said. "Amid the difficult times, the group is seeing growth in its digital media revenues and will continue to evaluate and pursue growth opportunities."
The directors have proposed a final dividend of 13 cents a share to be paid on Dec 23. This comprises a normal dividend of eight cents a share and a special dividend of five cents a share.
Together with the interim dividend of seven cents a share, the total dividend payout for the financial year will be 20 cents a share.