NAIROBI: Kenyan media company Standard Group said on Friday it expected its full-year earnings to be at least 25 percent lower than last year, hurt by disruptions from a countrywide digital migration of television signals.
Four Kenyan television stations, including one belonging to Standard Group, were off air for 19 days in February after the government switched off all analogue signals, leading to advertising losses for media companies, analysts said.
“The migration from analogue to digital TV broadcasting negatively impacted viewership due to low penetration of set-top boxes at the time of migration. This resulted in a significant decline in TV revenues in the first quarter of the year,” Standard Group said in a statement.
“In addition, the need to impair our existing analogue television equipment has significantly contributed to the one-off costs that have to be expended in our books this year.”
In 2014, Standard, which also publishes newspapers, websites and owns a radio station, reported an 8.4 percent rise in profit before tax to 326 million shillings ($3.14 million). It added that the company’s performance will be hurt by increased provisions for bad debt, due to the likelihood that some of it will not be repaid.
“The quick recovery of TV revenues and the growth in our Radio and Digital business lines means that we are confident of a better performance in the second half of the year,” it said, adding that it also expected to achieve significant cost savings in production and other direct costs.
