FY2014 Financial Results 15 October 2014

FY2014
Financial Results
15 October 2014
Group FY2014 financial highlights
FY2014
S$’000
FY2013
S$’000
Change
%
1,215,184
1,239,452
(2.0)
Operating Profit#
348,963
369,288
(5.5)
Fair value gain on investment properties
109,076
111,407
(2.1)
Investment Income
48,215
13,971
NM
Gain on partial divestment of 701Search*
52,863
-
NM
Profit after taxation
470,736
434,302
8.4
Net Profit attributable to shareholders
404,286
430,954
(6.2)
Operating Revenue
#
This represents the recurring earnings of the media, property and other businesses.
NM: Not meaningful
* 701Search is the holding company for the Group’s regional online classified business. During the financial year, the
Group entered into a strategic partnership agreement which provided for partial sale of stake in 701Search to
Telenor.
2
Group FY2014 financial highlights
Operating Revenue
FY2014
S$’000
FY2013
S$’000
Change
%
Newspaper and Magazine
931,686
991,220
(6.0)
Property
204,985
198,139
3.5
Others
78,513
50,093
56.7
1,215,184
1,239,452
(2.0)
Newspaper and Magazine
• Advertisement revenue fell S$51.3m (6.8%)
• Circulation revenue fell S$9.7m (4.9%)
Property
• Higher rental income from Paragon and The Clementi Mall
Others
• Higher revenue boosted by contributions from exhibitions, sgCarMart (acquired in
April 2013) and radio business.
3
Group FY2014 financial highlights
Profit/(Loss) before taxation
FY2014
S$’000
FY2013
S$’000
Change
%
Note
Newspaper and Magazine
246,381
293,340
(16.0)
(a)
Property
239,397
222,417
7.6
(b)
Treasury and Investment
30,419
11,385
NM
(c)
Others
12,194
(38,043)
NM
(d)
528,391
489,099
8.0
NM: Not meaningful
(a) Decline in profit of the Newspaper and Magazine business was mainly attributable to lower
advertisement revenue.
(b) Operating profit, before finance costs and fair value gain on investment properties, rose S$7.0m
(5.0%) to S$148.4m in line with higher revenue.
(c) Treasury performance, before including financing cost previously allocated to the Property segment
prior to REIT refinancing in July 2013, was lifted by increased dividend and interest income, higher
profit on sale of investments and lower impairment charges on portfolio investments.
(d) The Others segment turned into a profit with the gain on partial divestment of 701Search. In addition,
the local online classified, radio and exhibitions businesses registered better performance in the
financial year.
4
Group FY2014 highlights
Operating Revenue Composition
(S$1,215.2m)
Newspaper and Magazine
Advertisement Revenue Composition
(S$705.9m)
9.7%
16.9%
14.8%
26.9%
15.3%
58.1%
Advertisements (Newspaper & Magazine)
58.3%
Display
Circulation
Classified *
Rental & Services
Others
Magazines & Others
* Classified includes Recruitment and Notices
5
Ad revenue slowed as property and transport sectors
continued to face headwind
Newspaper Ad Revenue Y-O-Y Growth (%)
5.0%
0.0%
-1.7%
-2.9%
-5.0%
-5.9%
-7.0%
-7.9%
-10.0%
-7.1%
-7.3%
-8.0%
-7.8%
-9.8%
-9.1%
-7.4%
-10.3%
-10.3%
-10.2%
-15.0%
1QFY14
2QFY14
Display
3QFY14
4QFY14
Classified*
Total
FY14
* Classified includes Recruitment and Notices
6
Growth in circulation copies led by robust digital sales
500
Daily Average Newspaper Circulation
450
400
350
Thousands
300
250
200
150
100
50
0
The Straits
Times/ The
Sunday
Times
The
Business
Times
The New
Paper/ The
New Paper
Sunday
FY14
Lianhe
Zaobao
FY14
(Digital)
Lianhe
Wanbao
FY13
Shin Min
Daily News
Berita
Harian/
Berita
Minggu
Tamil
Murasu/
Tamil
Murasu
Sunday
FY13
(Digital)
7
Group FY2014 highlights
Cost Composition (S$882.1m)
21.3%
42.5%
14.0%
6.2%
7.4%
8.6%
Staff Cost
Newsprint
Premises Cost
Depreciation
Other Materials, Production & Distribution Costs
Other Operating Expenses
8
A leaner workforce as the Group restructures and transforms
Headcount as at end-August
Staff Costs (S$'000)
FY2014
FY2013
Change
%
4,204
4,339
(3.1)
374,519
349,643
7.1
Staff costs were up S$24.9m mainly due to salary increments, higher bonus costs including a oneoff special bonus for prior year (S$10.4m) arising from REIT profit and incentive to drive growth.
9
Near-term newsprint prices expected to soften
Average Newsprint Charge-Out Price &
Monthly Consumption
700
12,000
650
11,000
611
611
607
598
600
10,000
550
9,057
9,000
8,416
500
8,147
7,856
8,000
450
400
7,000
1QFY14
2QFY14
LHS - Prices (US$)
3QFY14
4QFY14
RHS - Ave Mthly Consumption (MT)
10
Healthy operating margins
S$'m
Recurring Earnings# and Operating Margin^
600
40.0%
35.0%
500
30.0%
400
25.0%
300
20.0%
15.0%
200
10.0%
100
5.0%
0
0.0%
FY2010
FY2011
Profit before investment income (S$'m)
#
FY2012
FY2013
Sky@eleven profits (S$'m)
FY2014
Operating Margin^
This represents the recurring earnings of the media, property and other businesses.
^ Computed based on recurring earnings excluding Sky@eleven.
11
Property segment maintains its steady growth
Paragon
The Clementi Mall
The Seletar Mall
• Will be the largest
suburban lifestyle hub in
• Rental reversions of 8.5% for SPH REIT portfolio
the North-East
• Healthy NPI margins for Paragon (76%) and The Clementi Mall • Targeted to open in
(69%)
November 2014
• Net Property Income (NPI) rose 5% to S$148.4m
• Market value for Paragon (Freehold) and The Clementi Mall at
S$2.7b and S$571m respectively
• Unit price rose from IPO at S$0.90 to S$1.065 as at financial
year end
12
Group investible fund
Group Investible Fund (S$1.9b)
14.6%
28.4%
37.4%
19.6%
Equities
Bonds
Investment Funds
Cash and deposits
(As at August 31, 2014)
• Conservative stance maintained on
investment allocation, focused on
capital preservation
• Returns are expected to be
commensurate with low riskreturn profile to mitigate against
volatility
• About S$300m managed for final
dividend payment and New Media
fund
13
Strong growth in traffic for Online Classified business


Top online classified website in
Malaysia, with monthly page views
exceeding 700 million1
No. 2 classified website in
Indonesia, with monthly page views
above 700 million1

Largest classified website in
Vietnam, with monthly page views
close to 500 million1

No. 2 classified website in the
Philippines, with monthly page
views of 270 million1
Data source:
1 Xiti , August 14
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Declared dividend per share of 21cents
7 cents interim, 14 cents final
(cents)
40
110%
94.4%
30
20
96.2%
90.2%
107.8%
100%
90%
80.4%
80%
10
27
24
24
22
21
0
70%
60%
2010#
2011
2012
Interim & Final Div (LHS)
2013^
2014
Div Payout Ratio* (RHS)
* Computed based on Group recurring earnings net of SPH REIT’s non-controlling interest (S$315m)
# FY2010 included profits from the Group’s Sky@Eleven development
^ Excludes special dividend of 18 cents paid pursuant to the establishment of SPH REIT
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Thank you
Please visit www.sph.com.sg for more information.