SPH reports record $1.38bln revenue

The group achieved $39.3mln investment income for FY 2010, a turnaround from $6.2mln loss for FY 2009.

Singapore Press Holdings Limited (SPH) on Tuesday reported its full year results for the year ended 31 August 2010. Underpinned by a strong and broad-based economic recovery in 2010, the Group benefited from a sturdy rebound in advertisement sales. The improved performance of the newspaper business and profits from our property project, Sky@eleven, boosted the Group’s recurring earnings to a record high of $539.1 million. This was $42.1 million or 8.5% higher than that of FY 2009. The Group’s investment income saw a turnaround and recorded a gain of $39.3 million compared to a loss of $6.2 million last year. After accounting for taxation, net profit improved 18.0% to $497.9 million from last year’s $421.9 million, according to an SPH report.

The Group achieved record operating revenue of $1,381.1 million in FY 2010, $79.7 million (6.1%) higher compared to that of FY 2009. Revenue for the Newspaper and Magazine segment grew strongly by $81.7 million (9.2%) year-on-year to $974.1 million. Print advertisement revenue surged by $84.8 million (13.1%) to $733.1 million driven by increases in Display and Recruitment advertisements. Revenue from the Property segment decreased by $9.5 million (2.6%) to $356.1 million. Rental income increased by $11.3 million (9.2%) mainly from Paragon but this was negated by lower year-on-year contribution from Sky@eleven which obtained its Temporary Occupation Permit in May 2010. Operating revenue from the Group’s other businesses rose by $7.5 million (17.3%) to $50.9 million with the increase coming from the internet and events management businesses.

Total operating expenses were up 5.0% to $858.8 million. Staff costs increased by $53.6 million (18.7%) mainly as a result of higher variable bonus provision in line with the improved performance of the newspaper business. Newsprint costs decreased by $36.9 million (29.1%) while other operating expenses rose by $12.6 million (6.7%) mainly attributable to higher donations and sponsorships, premises costs and other overheads.

The Group achieved investment income of $39.3 million for FY 2010, a turnaround from a loss of $6.2 million for FY 2009. Last year included losses from the Group’s externally managed funds as well as impairment, foreign exchange and derivative losses.

After accounting for taxation, net profit was $497.9 million, 18.0% higher compared to $421.9 million for FY 2009.

On the outlook for FY 2011, Mr Alan Chan, Chief Executive Officer of SPH commented: “The outlook for the Singapore economy remains healthy although there are lingering concerns of a double dip with an uneven pace of recovery and fragile situations in several advanced economies. Our print advertisement revenue is expected to move in tandem with the performance of the Singapore domestic economy. We look forward to the progressive opening of The Clementi Mall, scheduled to be completed in two phases between January and March 2011. Another business development is the strengthening of Sphere Exhibit’s foray into the MICE sector through new acquisitions.”

Barring unforeseen circumstances, the Directors expect performance for the current financial year to be satisfactory.

The Directors of SPH have proposed a Final Dividend of 20 cents per share, comprising a Normal Dividend of 9 cents per share and a Special Dividend of 11 cents per share in respect of the financial year ended 31 August 2010. These dividends are on tax-exempt (one-tier) basis and will be paid on 23 December 2010. Together with the Interim Dividend paid during the year, total Dividend payout for FY 2010 will be 27 cents.