SINGAPORE - Singapore Press Holdings (SPH) posted a net profit of $97.9 million for the first half of the financial year, as its various businesses recover from the ongoing Covid-19 pandemic.

The net profit rose 26.1 per cent in the first half of the financial year that ended on Feb 28 due to improvements in the group's non-media business segments, it reported.

Operating profit rose 16.6 per cent to $119.8 million, SPH said on Tuesday (March 30).

Overall, total revenue dipped 4.2 per cent to $460.3 million, with a decline in operating revenue from the media business.

This was partially offset by higher rental income of $15.4 million, mainly from purpose-built student accommodation (PBSA) and the retail and commercial segment. The decline was also cushioned by grant income of $15 million from the Jobs Support Scheme (JSS).

The total costs dropped by 9.8 per cent to $340.5 million. This is largely due to lower materials, production and distribution costs, which fell 40.9 per cent, or $23.9 million, with the decline in revenue from media and exhibitions. Disciplined cost management also reduced staff costs by 4.6 per cent to $158 million due to the lower headcount.

Revenue for the media segment fell 23.9 per cent to $193.1 million, with advertising revenue continuing to take a hit.

The structural decline in the advertising sector had led to a decline of 27.9 per cent, or $46.5 million, in media advertisement revenue. Newspaper print advertisement revenue fell 28.8 per cent, or $36.3 million. There was also the absence of revenue from Buzz, which was divested last July.

SPH said digital circulation continues to grow and expand audience reach, partially offsetting the fall in print circulation. In the first half of this financial year, the number of digital copies had surpassed print copies, making up 53 per cent of total circulation.

Circulation revenue decreased 4.7 per cent, or $3 million, as daily average newspaper print sales fell by 16 per cent.

This was partially cushioned by strong digital circulation growth, with a 20.2 per cent increase in daily average newspaper digital sales of around 70,000 copies, said SPH, which publishes The Straits Times.

Profit before tax for the segment was 70.9 per cent lower year on year at $3.1 million. This was mitigated by the JSS grant income of $12.8 million and reduction in materials, production and distribution costs by 38 per cent, or $21.5 million, and lower staff costs by $8.7 million. Excluding the JSS grant income, the media segment recognised a pre-tax loss of $9.7 million.

For the retail and commercial business, revenue rose 4.4 per cent to $154.6 million despite the impact of Covid-19. Revenue for the retail malls was lifted by the full six months' worth of contribution from the Westfield Marion mall in Australia.

Despite the fair valuation loss of $8.4 million for Westfield Marion and Figtree Grove shopping centres in Australia, the segment recognised a profit before tax of $86.3 million, which is 1.4 per cent lower year on year.

The PBSA segment grew by 24.2 per cent to $35.3 million, largely due to six months' worth of contributions from the Student Castle portfolio that was acquired in December 2019.

However, this was partially negated by revenue loss due to the lower occupancies and delayed tenancy start dates as a result of the pandemic.

The Student Castle portfolio contributed a $16.1 million increase in net operating income, which included $9.4 million in rental guarantee received from the vendor for the Oxford and Brighton greenfield assets.

The segment posted a pre-tax profit of $22.4 million, 18.3 per cent higher year-on-year.

Revenue from SPH's other segments, which include aged care, decreased by 16.9 per cent to $34.1 million.

Revenue from the exhibitions business fell 85.8 per cent with the deferment of shows due to the pandemic.

Including a $10.7 million higher dividend income from the investment portfolio and the one-off gain on disposal of a 100 per cent stake in meetings, incentives, conferences and exhibitions firm Exhibits arising from the merger with SingEx Holdings, the segment posted a pre-tax profit of $25 million.

As at Feb 28, the group's cash and cash equivalents stood at $959.5 million.

The board has declared an interim dividend of 3 cents a share payable on May 21, which exceeds the 2.5 cents paid out for FY2020.