SINGAPORE (Jan 11): Singapore Press Holdings (SPH), the media and property group, reported 1Q19 earnings dropped by 6.3% to $57.9 million, due to a 74.3% decline in contribution from investments as the Treasury & Investment portfolio was partially divested by August 2018 at the end of the previous financial year.

Total revenue, made up of operating revenue and other operating income, fell 3.2% to $258.8 million.

Group operating revenue, which comprised advertisement and print and digital circulation revenue, rental income and income from other businesses, fell 1.7% to $254.3 million due to lower print advertisement revenue, but partially offset by a $6.3 million contribution from the group’s newly acquired UK student accommodation portfolio.

SPH said the rate of decline in print ad revenue was the slowest seen in four quarters while digital ad revenue enjoyed double-digit growth of 12.9%.

Revenue for the group’s media business fell 6.8% to $162.1 million while revenue for its property segment rose 11.1% to $68 million. Revenue for the others segment, which included its aged care business, increased 2.6% to $24.2 million.

Other operating income, which comprised sales of production waste and other scrap materials, distribution service fees for third party periodicals and income from branding events, fell 48.1% due to the absence of a $5.9 million gain arising from the dilution of the interest on the IPO listing of MindChamps Preschool in 1Q18.

Total costs decreased by 7% to $183.9 million from $197.7 million last year with other operating expenses dropping by 41.7% y-o-y to $23.9 million.

Operating profit for the media business was 14.7% higher mainly due to the absence of retrenchment costs recognised in the same period last year while operating profit for the property business was 5.2% higher, boosted by a contribution of $3.2 million from the UK student accommodation portfolio which was acquired in September 2018.

Net income from investment was 74.3% lower at $3.18 million from $12.4 million in the previous year, mainly attributable to the absence of a gain on disposal of investments of $9.1 million in 1Q18.

During the quarter, the group recorded a loss from its share of results of associates and joint ventures of $0.46 million, compared to a gain of $0.22 million the same period a year ago. This was due to showflat and marketing expenses for The Woodleigh Residences, but partially offset by lower losses recorded by the online classifieds business in Indonesia and Thailand.

As at end Nov 2018, SPH’s cash and cash equivalents stood at $379.9 million.

Looking forward, the group says that its core media business is focused on accelerating its digitisation efforts to capture growth opportunities.

Ng Yat Chung, CEO of SPH, says, “The print side of the media business continues to experience headwinds, even as we grew revenue from the digital side of the business. We made progress in growing recurring income from the property segment with initial contribution this quarter from our UK student housing assets and we look forward to more contribution."

Shares in SPH closed at $2.49 on Friday.