HONG KONG: The SCMP Group, the publisher of Hong Kong's South China Morning Post newspaper, posted yesterday a 62% drop in interim profit on SARS outbreak and warned of an uncertain outlook amid a battered local economy.
SCMP, controlled by Malaysian tycoon Robert Kuok, said its earnings for the six months ended June 30 fell to HK$33.98mil from a restated HK$90.08mil in the previous year as the outbreak of SARS pounded its core newspaper and magazine businesses.
“Whilst there are signs of recovery from SARS, boosted in part by the government's economic stimulus package, unemployment continues to rise to record levels and deflationary pressures continue to affect some sectors,” chairman Kuok Khoon Ean said in a statement.
“Against this backdrop, advertising and circulation sales have improved, but the pace and strength of such recovery remain uncertain,” it said.
Turnover of SCMP, which also runs a chain of convenience stores, dropped 8.4% to HK$613.64mil.
Merrill Lynch analyst Agnes Ho had expected a profit of HK$25mil, assuming a 12% decline in revenues. That compares with a HK$36.7mil profit forecast by Daiwa Securities, which also had expected SCMP's revenues to fall by 12%.
SCMP said in May that a plunge in advertising and subscription sales would hit earnings, joining a rash of profit warnings in the territory in the wake of the SARS outbreak. – Reuters