SPH’s newspaper print ad revenue continues to decline, falling 17.6% y-o-y for 9MFY2021, as the restructuring of its media assets is set to be discussed at an EGM in August or September 2021. SPH reports its financial year ending August 31. 

SPH’s media segment saw total circulation copies remain flat y-o-y, while digital circulation grew 17.8% y-o-y for 9MFY2021, says SPH in its 3QFY2021 corporate presentation. Its "news tablets" subscriptions, which bundles a tablet computer with digital versions of the newspapers, however, increased 70.1% y-o-y, albeit from a low base.

See: SPH to cut loose former core media business with $351.3 million send-off package

SPH notes “little scope” for further cost cuts without impairing the quality of its newspapers, noting it is “challenging” to reduce staff costs further as production costs rise. “Pagination has been reduced over the years but newsprint prices are on the rise due to shrinking supply as mills close due to Covid-19,” says SPH.

Upon securing shareholder approval at the EGM, the media segment’s restructuring will commence from September. SPH expects the restructuring to be complete by December. 


Meanwhile, SPH’s non-media segments saw improved operating performance since February. 

On the retail and commercial front, SPH REIT reported distribution per unit (DPU) of 1.38 cents for the period of 3QFY2021 ended June, 11.3% higher q-o-q. The REIT also announced a 22.2% y-o-y increase in gross revenue to $209.6 million, led by recovery in performance across all its assets.

For 3QFY2021, portfolio occupancy rate came in at 98.4% driven by the resilience of the suburban malls with full occupancy at The Clementi Mall and The Rail Mall.

Tenant sales for suburban malls in Singapore and Australia are recovering to pre-Covid-19 levels in 2019. However, SPH’s Paragon, located in the Orchard Road shopping district, continues to suffer the impact of decimated tourist arrivals, though SPH notes strong footfall at its “resilient” medical office tower.

On its purpose-built student accommodation (PBSA) segment in the UK, SPH achieved 73.7% of its target revenue as at July 16 for the academic year (AY) 2021/2022. Despite the pandemic, AY2021/22 surpassed AY2020/21 sales trend and is on track to achieve more than 90% portfolio occupancy. 

Bookings have picked up, says SPH, as the UK reopens from July 19. International student demand remains strong, it adds, with 53% of current bookings for Student Castle properties at Oxford and Brighton coming from Chinese students.

SPH expects bookings to increase from July to August in line with the release of college entry examinations results. 

13 out of its 28 PBSA assets are currently managed in-house, and SPH is transferring its remaining UK assets by Oct 12, 2021 to “better control sales and marketing of assets”.

Aged care and digital 

SPH also believes it is on track to establish its aged care segment as a “key business pillar”. Orange Valley, one of Singapore's largest private nursing home operators, has been appointed as the operator of a government-built nursing home at Bidadari. As part of an asset-light strategy, SPH is also reviewing potential deals in Japan, Canada, Australia and the UK. 

Bed occupancy rates for its Orange Valley assets improved slightly to 89% in May from 84% in February. SPH notes that the underlying portfolio occupancy for its Japan aged care asets remained at more than 90%. 

Finally, SPH’s digital investments saw online car portal sgCarMart 3QFY2021 revenue grow 18% y-o-y with better sales. SPH acquired sgCarMart for $60 million in 2013. 

Meanwhile, M1 is set to transfer network assets to a special purpose vehicle set up by Keppel DC REIT and M1 for $580 million, recycling capital from the telco.

SPH’s digital portfolio also includes online marketplace Carousell, which is exploring a merger with a SPAC in a US$1.5 billion IPO. 

It also includes financial services company iFAST, which is leading a consortium applying for a digital banking licence in Malaysia. Singapore's best-performing stock over the last year, its skyrocketing share price on the Singapore Exchange offers a $240 million remeasurement gain for SPH.