Singapore Press Holdings (SPH) is looking at overseas opportunities to expand its real estate asset management and aged care businesses, as well as sharpening its digital capabilities even as the decline in its core media business shows signs of slowing down.
SPH's third-quarter net profit rose 64.3 per cent year-on-year to $47.44 million on the back of lower impairment charges, while operating revenue declined 3.8 per cent to $250.07 million.
Operating profit was up nearly 30 per cent at $44.41 million, owing to a near 41 per cent drop in impairment of goodwill and intangibles to $22.33 million. This was despite revenue from the media business falling 8 per cent to $167.94 million.
Earnings per share for the quarter edged up to three cents, from two cents in the same period last year.
For the nine months ended May 31, net profit rose 15.6 per cent year-on-year to $148.07 million, despite a 4.3 per cent slide in operating revenue to $742.53 million.
"As we continue to sharpen our media capabilities in the face of digital disruption, we are seeing early signs of a slower decline of our media revenue. At the same time, we are making efforts to diversify, with new growth thrusts," said SPH chief executive officer Ng Yat Chung in a statement.
"Our new strategy is to focus on the acquisition of cash-yielding real estate assets overseas. We are also preparing the aged care business for overseas expansion."
AT A GLANCE
REVENUE: $250.07 million (-3.8%)
NET PROFIT: $47.44 million (+64.3%)
As part of its push to expand into other asset sectors overseas, a new asset management company, Straits Capitol, has been set up in Britain, and is actively reviewing a pipeline of deals. In particular, it is eyeing "recession-proof defensive sectors".
Meanwhile, under its aged care vertical, SPH is preparing to grow regionally where the silver market is expanding rapidly. In Singapore, the group owns Orange Valley, which is the nation's largest private nursing home operator.
The media and property group also highlighted that its digital-first strategy has been gaining ground, as both digital subscriptions and E-paper readership grew. For the third quarter, daily average digital circulation rose by 121,000 copies, or 43.5 per cent, to 399,000 from a year ago.
Meanwhile, its E-paper is also seeing good readership, it said, with over 37,000 unique readers for The Straits Times, which translates to over 15 per cent of ST's print circulation.
For the nine-month period, total digital ad revenue grew by 10 per cent.
In the quarter under review, SPH also strengthened its management team for digital transformation, which included new hires.
Mr Ignatius Low, formerly head of media solutions, was named chief marketing officer and is tasked with spearheading the group's integrated marketing strategy.
Mr Glen Gary Francis was appointed chief technology officer and Mr Gaurav Sachdeva was appointed chief product officer. Mr Francis is responsible for the technologies and digital capabilities for SPH's businesses, while Mr Sachdeva will help with the development and monetisation of SPH's digital media content and products.
In addition, former head of the digital division, Mr Julian Tan, was redesignated chief of digital business to drive SPH's portfolio of digital investments.
Commenting on the latest property cooling measures that were implemented last Friday, SPH said the group is still monitoring the potential impact on The Woodleigh Residences, which is part of a commercial-cum-residential site it is jointly developing with Kajima Development.
In a separate announcement, SPH said it is partnering local machine learning start-up, DC Frontiers, to develop a content recommendation engine driven by artificial intelligence.
The engine will use analysis and algorithms to curate articles for SPH's readers based on individual news consumption habits and other attributes.
SPH has a 25 per cent stake in DC Frontiers, which is known for its award-winning Handshakes product. The project is part of SPH's ongoing efforts to deepen audience engagement using the latest technologies.
Shares in SPH eased two cents to $2.75 yesterday. Its financial results were released after the market closed.