Media Prima posts Q2 loss due to impairment exercise

THE MALAYSIA NEWSPRINT INDUSTRY PLANT IN TEMERLOH-EXPECTED TO PRODUCE THE LOCAL NEWSPRINT IN LARGE AMOUNT IN FUTURE IS ON OF THE DEVELOPMENT IN PAHANG FOR SUPPLIMENT STORIES

KUALA LUMPUR: Media Prima Bhd reported a net loss of RM132.91mil for the second quarter ended June 30 against a net profit of RM27.92mil a year ago largely due to an impairment of its investment in its associate Malaysian Newsprint Industries Sdn Bhd (MNI). 

The impairment of its 21.4% -owned stake in MNI amounted to RM142.4mil.

Media Prima’s revenue, meanwhile, was down 5.9% to RM328.77mil for the quarter from RM349.55mil a year ago, as its Television Networks division was impacted by weak advertising expenditure (adex) that continued to affect its free-to-air (FTA) television segment.

The weaker performance has resulted in a loss per share of 11.98 sen for the period under review compared with an earnings per share of 2.52 sen a year ago.

The broadcaster said in a filing with Bursa Malaysia that if the one-off impairment of investment in MNI was excluded, the group would have booked a net profit of RM4mil against a net loss of RM41.4mil in the first quarter of financial year 2017 (FY17).

“Revenue for Television Networks declined by 15% compared with the previous corresponding period, as weak adex continues to affect the FTA television segment.

“The decline in revenue led to Television Networks posting a loss of RM20.7mil against RM22.1mil in net profit in the previous corresponding period,” the group noted.

While Media Prima has ventured into new digital and consumer-based business initiatives to complement its traditional media segments, the initiatives are still in a gestation period.

The performance of the print media remained challenging, as evidenced by a 20% decline in revenue in the first half of FY17 due to lower newspaper advertising and circulation revenue despite the encouraging performance of its digital properties.

Both outdoor media and digital media revenue increased by 10% and 22%, respectively, supported by higher display and production revenue, and higher digital services rendered.

Radio network and content creation revenue, meanwhile, declined, attributed to lower adex and lower production revenue from Television Networks.

For the cumulative six-month period, Media Prima said it had booked a net loss of RM171.37mil from a net profit of RM45.16mil previously on revenue of RM600.97mil from RM653.62mil before.

The group’s new chairman Tan Sri Ismee Ismail said the company was committed to delivering value to shareholders by capitalising on the increasing demand for e-commerce and digital content among consumers.