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SPH reports swansong earnings of $92.9 million for FY2021

The Edge Singapore
The Edge Singapore 10/5/2021 09:34 PM GMT+08  • 3 min read
SPH reports swansong earnings of $92.9 million for FY2021
SPH plans to pay a final dividend of three cents, bringing full year payout to six cents, versus 2.5 cents paid last year.
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In what is likely to be the last full year earnings report by Singapore Press Holdings, the property and media company reported a profit of $92.9 million for the year ended Aug 31, versus $83.7 million in the red incurred for FY2020.

Revenue in the same period increased by 2.4% y-o-y to $475.1 million.

The company plans to pay a final dividend of three cents, which will bring its full year FY2021 dividend to six cents. Based on today’s (Oct 5) closing price of $1.98, that’s a yield of 3%.

In contrast, it paid just 2.5 cents for FY2020.

SPH’s bottomline reported for FY2021 includes a fair value gain on its properties of $66.6 million – a partial reversal from the fair value losses of $232 million booked last year because of the pandemic.

SPH owns real estate ranging from students’ accommodations to old folks’ homes and even residential bungalows carried on its books at $134.5 million.

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Stripping out the fair value gains, the real estate businesses enjoyed better operating results across the board in FY2021, thanks to various factors such as contribution from new acquisitions and better operating conditions.

Following shareholders’ go-ahead to move the media business to a separate entity on Sept 10, SPH’s media operations are being reported under discontinued operations.

For FY2021, this segment incurred a loss of $128.3 million, versus a $12 million loss for FY2020.

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The bulk of the red ink was from $115.3 million in net asset value from the media business that will be transferred from SPH to the new not-for-profit media entity. The process will be completed by end of the year.

SPH has flagged the need to book further losses in FY2022 related to the send-off of the media business. This consists of $80 million in cash and some $115.5 million worth SPH REIT units and SPH shares.

The one-off items aside, the media business incurred an operating loss of $38.7 million for FY2021, slightly reduced from FY2020’s $40.1 million. These numbers did not include some $17.8 million and $28.1 million worth of government wage subsidies booked in FY2021 and FY2020 respectively.

The continued decline in print revenue (of 14.7% y-o-y) aside, SPH’s total digital media revenue, which includes both advertising and circulation, dropped as well. From $118.3 million generated in FY2020, this number dipped slightly to $111.3 million.

Total digital circulation, meanwhile, increased by 13.5% between FY2021 and FY2020.

Come middle of next month, SPH shareholders are slated to vote on the $2.2 billion privatisation offer tabled by Keppel Corp on Aug 2 for the remaining non-media assets of the company.

“We took the difficult decision earlier to restructure the media business. That will enable SPH to avoid future losses and funding needs from the media business and we will focus on expanding the portfolio of the non-media business,” says CEO Ng Yat Chung.

“The next step is for shareholders to consider the privatisation offer from Keppel.”

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