SPH net profit plunges in 1Q12

Close to 5% dip yoy on the back of core business shrinkage and staggering forex losses.

Net profit attributable to shareholders slid to $97.5 million, or $4.8 million lower compared to the first quarter last year.

SPH's newspaper and magazine segment declined 1.2% in revenues to 262 million. Meanwhile, its investment income plummeted 90.3% "as a result of unrealised foreign exchange losses on investments arising from volatility in the financial markets," it said in a release coinciding its earnings report to the Singapore Exchange.

These losses were offset by gains in its property, Internet and exhibitions segments. All in all, Group recurring earnings for 1Q12 rose 4.2% to $121.2 million from a year ago.

Costs were also on the rise for SPH.

"Newsprint costs was up by $1.1 million (4.2%) driven by higher newsprint prices but partially cushioned by a favourable exchange rate. Staff costs increased by $1.3 million (1.5%) due to salary increments partially offset by a reduced variable bonus provision," it said.

"Other operating expenses rose by $7.9 million (16.1%) mainly from the commencement of Clementi Mall operations, costs incurred for newspaper subscription drives and step-up in overheads in tandem with increased business activities and inflationary pressures," it said further.

On the outlook for FY2012, Mr Alan Chan, Chief Executive Officer of SPH commented: “The outlook for the global economy remains fraught with uncertainties. The Group will strive for a sustained performance in the core newspaper business whilst pursuing growth in business adjacencies.”