Reading the annual report of a company is a great way to learn more about it.
I had recently read through the latest annual report from Singapore Press Holdings Limited, a leading media organization in Singapore. There are several important things I had picked out from the report which may be of interest to investors. Here are four of them:
1. A multi-faceted media organization
SPH houses multiple media formats under its umbrella. The best known are probably newspapers like The Straits Times and Lianhe Zaobao. Additionally, SPH owns more than 100 magazine titles and online sites such as AsiaOne, hardwarezone.com, ShareInvestor, and Stomp.
The company’s media segment also includes SPH Buzz, a network of 78 convenience stores, and radio stations like Kiss92 and ONE FM 91.3.
Elsewhere, SPH has a 20% stake in MediaCorp TV Holdings and a 40% stake in MediaCorp Press Limited.
2. SPH REIT is the key to its property segment
“SPH REIT comprises Paragon, a premier upscale retail mall and medical suite/office property in Orchard Road and The Clementi Mall, a mid-market suburban mall in the centre of Clementi town. The Seletar Mall, located in Sengkang, is SPH’s latest retail development. This property is a potential asset to be injected into SPH REIT.”
SPH owns more than 70% of SPH REIT. At the moment, the real estate investment trust (REIT) has only two properties in its portfolio. The new Seletar Mall, which enjoys 100% occupancy, might be injected into SPH REIT in the future.
3. Newspaper circulation remains high
“SPH’s total newspaper circulation, covering both print and digital editions, averaged 1,113,879 copies per day, a year-on-year increase of 4.3 per cent. This was achieved by reaching out to more readers on their mobile devices while continuing to excel in print.
ST [Straits Times] and The Sunday Times registered a year-on-year growth of 4.9 per cent to 481,700 daily average circulation copies, with its paid digital edition ending the year at 177,400 copies, a growth of 18.6 per cent.”
Circulation of newspapers, including digital formats, remains robust. For Straits Times and the Sunday Times, the majority of circulation growth had come from its digital edition which grew by 18.6%. The digital edition now makes up close to 37% of its circulation.
As SPH transitions its traditional media platforms into digital formats, digital circulation and readership data will be important things for investors to watch.
4. All eyes are on new digital formats
“The Straits Times, Lianhe Zaobao, Lianhe Wanbao, together with news aggregator website AsiaOne and bilingual interactive web portal omy.sg, developed and launched Apple Watch applications.
BT [Business Times] now caters to an increasingly mobile readership and has boosted the value of its All-in-One subscription bundle.
Berita Harian (BH), the Group’s Malay-language newspaper, implemented several initiatives to streamline its operations and develop new revenue streams. In July 2015, the newspaper launched a new version of its mobile apps and e-newsletter.
Mobile is an integral platform for publishers to deliver content to its users.”
SPH is also exploring new formats for delivery of content on smart wearable devices, like with the Apple Watch. An overarching theme for the company’s digital efforts may be mobile, where most of the online traffic may be coming from.