SPH prints net profit of $145 million for Q1

Singapore Press Holdings has posted a net profit of $145 million for the first quarter ended 30 November 2009.

At the onset of the recession a year ago, SPH reported a loss of $33.7 million. It now reports a gain of almost $10.2 million in net investment income. Its recurring profit has also increased 24.7% to $159.4 million. Also, net profit at $144.7 million was almost double that of the same period of the previous financial year. Group operating revenue at $354.0 million was $13.7 million or 4.0% above that of the corresponding period of the previous financial year.

However, operating revenue of the Newspaper and Magazine segment fell by 2.5% from the previous year to $6.2 million at $243.2 million.

Print advertisement revenue also suffered, falling 3.1% to $5.8 million as a result of lower classifieds advertisements. Group circulation revenue decreased marginally by $0.6 million or 1.1% in line with lower circulation copies sold.

The Group’s Property segment was one of the earners for SPH, as it continued to turn in a robust performance on the back of higher revenue from Sky@ Eleven(+$19.4 million or 38.2%). Operating revenue from the Group’s other businesses also rose by $1.5 million, contributed mainly by the Group’s new businesses.

Also, another contributing factor to the Group’s rising profits could be its drop in its total operating expenses by 8.2% to $197.6 million. Newsprint costs were lowered by $13.6 million or 38.1% while staff costs fell $1.7 million or 2.2% due to the wage cuts implemented by the Group in April 2009 and Jobs Credit grant. No additions or reductions had been made, however, as the total headcount as at November 2009 remained flat at 3,945. Other operating expenses decreased by $6.8 million or 13.4% as a result of lower factory and other overheads. These were partly offset by the increase in property development costs of $5.5 million or 38.0% recognised for Sky@ Eleven, in line with the higher percentage-of-completion of construction.

After accounting for taxation, net profit of $144.7 million for the Group was 98.2% higher than that of the same period of the previous financial year.

Mr Alan Chan, Chief Executive Officer of SPH, commented that the group’s outlook for 2010 was hopeful, with the economy is expected to grow at a modest pace, therefore their advertisement revenue was expected to move in tandem with the economy.

Also, SPH has announced a partial restoration of pay cuts implemented in 2009.

He said: “We will continue to monitor our cost levels closely while at the same time devote resources and explore opportunities to grow beyond print and Singapore. The Directors are pleased with the Group’s results for the first quarter and, barring unforeseen circumstances, expect overall performance for FY2010 to be satisfactory.”