Star 2Q profit falls 35% with all businesses hit

Star 2Q profit falls 35% with all businesses hit
Business & Markets 2013
Written by Shalini Kumar of theedgemalaysia.com
Wednesday, 14 August 2013 18:51

KUALA LUMPUR (Aug 14): STAR PUBLICATIONS (M) BHD [] saw a 35.5% drop in its net profit to RM28.5 million, compared with RM44.2 million in the previous corresponding quarter.

Revenue also fell to RM251.3 million, compared with the RM299.4 million posted in 2QFY12.

In the notes accompanying the financial statements, the group said there had been a drop in revenue and profit in all its business segments: print and new media, radio broadcasting, events and exhibitions, and TV.

"[The radio segment] experienced a loss in earnings due to higher advertising and promotion expenses for branding of RedFM and 988 radio stations," it said.

"For the events, exhibitions interior and thematic segment, the decrease in revenue is mainly due to lesser projects completed in the current period by Cityneon. Li TV Holdings Ltd suffered a loss due to higher programme and marketing expenses," it added.

For the first half of the year, the Star recorded a drop in net profit to RM54.6 million, from RM76.7 million.

Revenue for the first half was RM471.9 million, compared with RM529.4 million at the same time last year.

Looking ahead, the group said it expects the business environment in the media industry to remain highly challenging in 2013.

"In the media sector, advertising expenditure has remained soft but is expected to gradually pick up in the second half of this year as sentiment improves with the seasonality effect," it said.

"The media related segments of the group will continue their efforts in growing the advertising revenue and to offer wider advertising platforms to its clients," Star added.

However, Cityneon is expected to turn around its business in 2013 as a result of significant cost savings, while I.Star Ideas Factory will continue its efforts to grow its revenue and profits by organising more events this year.