SPH third quarter profit up 17% to $115mn

Yet the group’s profit attributable to shareholders for the nine months ending May 31was down 30.8%.

Singapore Press Holdings Limited (SPH) on Tuesday reported its results for the third quarter ended 31 May 2011 (3Q FY11). Excluding Sky@eleven profits in the third quarter last year (3Q FY10), net profit was up $16.8 million (17.1%) to $114.8 million and recurring earnings rose by $5.5 million (5.2%). Improved performance from the internet and exhibitions businesses cushioned a marginal reduction in profits from the Newspaper and Magazine segment. Investment income doubled year-on-year to $23.7 million.

Operating revenue of $263.0 million for the Newspaper and Magazine segment for 3Q FY11 fell by 1.1% compared to 3Q FY10. Print advertisement revenue decreased by $3.2 million (1.6%) to $201.1 million mainly due to lower Classifieds advertisements. Circulation revenue of $53.8 million remained stable year-on-year with positive results from newspaper subscription drives, according to an SPH report.

Rental income for the Group grew by $8.0 million (22.8%) in 3Q FY11 to $43.2 million. Paragon contributed $2.0 million (5.7%) to the increase as a result of higher rental rates achieved. Clementi Mall is fully leased and tenants have progressively started operations since January 2011. Rental income from Clementi Mall for 3Q FY11 was $6.0 million.

Operating revenue from the Group’s other businesses surged 64.5% to $22.7 million. Newly acquired IT Show and Food & Beverage Fair, and maiden trade show BuildTechAsia, from the exhibitions business were the main contributors to the increase.

Materials, consumables and broadcasting costs were higher by $5.8 million (14.9%) mainly due to the increase in newsprint costs by $3.5 million and higher costs associated with the exhibitions business. Staff costs fell by $8.3 million (8.6%) due to lower variable bonus provision partially offset by salary increments and increased headcount.

The increase in other operating expenses of $7.6 million (14.9%) was attributable to Clementi Mall and the newspaper subscription drives. 

For the nine months ended 31 May 2011, the Group’s recurring earnings of $305.4 million was $158.2 million (34.1%) lower than the same period last year, which included Sky@eleven profits of $159.2 million. Investment income increased by $14.6 million (57.5%). Net profit attributable to shareholders of $292.5 million was $130.1 million (30.8%) lower than the comparative period. 

On the outlook for FY 2011, Mr Alan Chan, Chief Executive Officer of SPH commented: “In the near term, prospects remain positive and the Group’s print advertisement revenue is expected to move in tandem with the Singapore domestic economy. The Clementi Mall, which was officially opened in May, is poised to enjoy good catchment from the surrounding residential areas and tertiary institutions. We will continue to invest in new media and explore business adjacencies for growth.” 

Barring unforeseen circumstances, the Directors expect overall performance of the Group for FY 2011 to be satisfactory.