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SPH Q3 net profit dips in absence of exceptionals - Jul 12, 2007 (BT)

BackJul 12, 2007

The Straits Times / The Business Times News On SPH

SPH Q3 net profit dips in absence of exceptionals

But operating profit up 15.2% at $108.8m.

By Chow Penn Nee
Jul 12, 2007
The Business Times

MEDIA group Singapore Press Holdings (SPH) put up a strong showing for the third quarter ended May 31, with its operating profit rising 15.2 per cent to $108.8 million.

Paragon: Last year's Q3 results had included an exceptional gain of $69.1 million, mainly from the write-back of impairment losses for its Paragon shopping centre in Orchard Road.

But this was masked by an 8.5 per cent dip in net earnings to $159.8 million resulting from the absence of exceptional gains. Last year's Q3 results had included an exceptional gain of $69.1 million, mainly from the write-back of impairment losses for its Paragon shopping centre in Orchard Road.

Including net income from investments of $75.3 million and contributions from associates and jointly controlled entities totalling $2 million, the group's Q3 profit before exceptional items and taxation was up 48.3 per cent at $186.1 million.

The Q3 results raised nine-month net profit to $380.1 million, 6.3 per cent up from the previous corresponding period's $357.6 million, which included the $69.1 million exceptional gain.

Reflecting the improvement in the group's businesses, Q3 operating revenue rose 8.4 per cent to $288.1 million.

Revenue from the core newspaper and magazine business grew 7.8 per cent to $255.7 million on the back of a 10.4 per cent surge in print advertisement revenue to $195.6 million. Property operations rose 6.6 per cent in revenue to $26 million.

SPH chief executive Alan Chan said: 'Print advertising looks promising as the economy is doing well. Paragon is generating healthy rental yields amid strong sentiment in the property market.'

Q3 operating expenses increased 5 per cent to $182.2 million, mainly because of a 12 per cent rise in staff costs from a year earlier. This stemmed from variable bonus provisions, a bigger headcount and annual salary increments.

The acquisition of new subsidiaries and staffing new media businesses raised headcount to 3,684 in May from 3,583 a year earlier.

Group investment income in Q3 soared 139 per cent to $75.3 million, mainly due to a net profit on sale of investments and a capital reduction exercise by phone company MobileOne.

Q3 earnings per share before exceptional items rose to 10 cents from seven cents. Earnings per share after exceptional items in the year-ago period was 11 cents. Net asset value per share improved from $1.28 in August last year to $1.29 in May.

Commenting on the outlook for the rest of the financial year, Mr Chan said: 'The group is strengthening its presence on various new media platforms and extending its reach beyond the core newspaper business. Barring unforeseen circumstances, the directors expect the group to perform better than last financial year.'