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7 Quick Things Investors Should Learn From Singapore Press Holdings Limited’s Latest Earnings Presentation

Singapore Press Holdings Limited  (SGX: T39) is one of the cool companies in Singapore that shares webcasts and/or transcripts of their earnings presentations.

In mid-October this year, the company released its full-year earnings for its fiscal year ended 31 August 2016. I had spent time going through the webcast for the earnings presentation and noted down seven things that may interest investors.

As a quick background, SPH may be best known as a publisher of most of the major newspapers in Singapore. But, the company also owns online media platforms, develops and invests in properties, and engages in activities such as events management. As part of its real-estate business, SPH is the majority owner and sponsor of SPH REIT (SGX: SK6U).

With that, here are my notes:

  1. The Media segment and Property segment were the major contributors of operating revenue, making up around 74.1% and 21.5%, respectively, of the total pie.
  2. Under the Media segment, advertisement revenue fell 9.2%. SPH said the result was “unsurprising” given the prolonged slump in the economy. Circulation revenue was also down 3%, offset by the cover price increase SPH implemented in March this year. The Media segment’s profit was also hit hard, dropping 27.4%.
  3. The Others segment, which consists of activities such as exhibitions and online classifieds, made up 4.4% of SPH’s overall revenue. The segment made $24.4 million in losses in FY2016, a reduction from the $38.6 million in losses seen in the previous fiscal year.
  4. SPH increased its cover price by between 10% to 20% earlier this year. The media firm believes that the impact to customers is not as significant, as it was an “all-in-one” offer. SPH said that customers will get both print and digital subscriptions for the same price as print alone.
  5. SPH has a $1.2 billion group investable fund which consists of equities, bonds, investment funds, and cash and deposits. SPH said that fund is managed with the twin objectives of return with low value-at-risk. The fund’s return in FY2016 was 5%. The fund has generated a return of 4.1% annually since its inception in 2001.
  6. SPH also gave a summary on its digital revenue performance. Digital revenue has risen over 50% from FY2013 to FY2016. During the same timeframe, more than 20 new digital products and over 30 new or revamped apps were launched.
  7. SPH proposed a final dividend of 11 cents per share. Together with the interim dividend of 7 cents, the total dividend for FY2016 will be 18 cents per share. This represents a 109.1% payout ratio.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong doesn’t own shares in any companies mentioned.