Singapore Press Holdings, the parent company of The Straits Times, Lianhe Zaobao, and other news publications, saw overall revenue drop 3.8% in the first quarter of fiscal 2020 (ended November 30, 2019) as print ad sales plummeted 19.8% from the same period a year ago. Print ad revenue has been in decline for some time now, but the pace of decline in print display and newspaper ads appears to be accelerating.
Digital ad sales continued to rise 8.8% on year, but as a whole, revenue for SPH's media segment shrank 13.6% or $22.0 million in the quarter to $140.1 million, contributing to a 17.2% decline in net profit by $9.6 million to $46.3 million.
“Our core media business remains challenged as advertisers cut back on their advertising due to the uncertain business outlook," SPH CEO Ng Yat Chung said in a release. The company for many quarters has relied on its property portfolio (now responsible for 80% of SPH profit) to offset its media challenges.
The company says it continues to focus on digital transformation initiatives in its media businesses, including the recent launch of news tablet subscriptions. Daily average newspaper digital subscription sales rose by 49.8%, outweighing the drop in daily average newspaper print sales of 51,010 copies or 10.3%. While circulation rose (8.1%) for the first time in four quarters, circulation revenue still fell 4.3% or $1.5 million for the quarter overall.
Operating profit fell 27.9% by $20.9 million to $53.9 million due to a one-time $7.2 million hit from a "rationalisation exercise" involving the media sales and content teams in October. However, staff costs edged lower by 2.4% as part of ongoing cost management programs.
*All figures in SGD