PETALING JAYA: Star Media Group Bhd has recorded a marginal increase of 0.7% in revenue for the first nine months in the current year of operations to maintain its growth trend.
On the back of a challenging environment, where consumer spending and advertising expenditure remained subdued, the group registered a revenue of RM738.25mil for the period ended Sept 30, 2015, compared to RM732.85mil in the corresponding period last year.
Profit attributable to shareholders for the nine months stood at RM83.48mil, a decline of 7.2% compared to the corresponding period last year due to higher direct costs from Singapore-listed subsidiary, Cityneon Holdings Ltd, and lower revenue from its print segment and i.Star Ideas Factory Sdn Bhd.
Revenue for the print and digital segment, the mainstay of the group, decreased by 7.9% mainly due to poor consumer sentiment and advertisers holding back on spending due to the implementation of the goods and services tax, the weakening ringgit and the domestic economy.
However, the segment’s profit before tax saw a slight increase of 2.4% compared to the corresponding period last year if an RM11.5mil expense incurred for the voluntary separation scheme in the first half of last year is taken into account.
The events, exhibition, interior and thematic segment that comprises Cityneon and i.Star Ideas Factory saw an increase in revenue from RM153.53mil to RM200.80mil mainly due to the completion of the projects carried out by the Singapore-listed company.
However, the segment registered a loss before tax of RM3.62mil for the nine months until end-September due to a lower profit margin and the acquisition-related cost of Victory Hill Exhibitions Pte Ltd in Cityneon, as well as a drop in revenue for i.Star Ideas Factory.
Cityneon completed the acquisition of Victory Hill Exhibitions – the company with the rights to hold exhibitions for Marvel’s Avengers – on Sept 30 for S$21mil in a deal financed by cash and shares.
For the third quarter, revenue increased by 2.96% to RM254.51mil compared to the corresponding quarter last year. However, profit before tax and after tax in the quarter decreased by 37.5% and 35.9%, respectively, against the corresponding quarter of 2014 due to higher direct costs from Cityneon and lower revenue from the print and events/exhibition segments.
Going forward, Star Media Group expects advertising expenditure for the rest of the year to remain subdued on the back of a challenging and uncertain economic outlook.
The company said it would continue to enhance its respective media platforms to extend reach and provide more bundled products and creative buys to advertisers.
In the events business segment, Cityneon will continue to seek more opportunities both locally and in markets such as Vietnam and Myanmar, while i.Star Ideas Factory, known for its Perfect Livin’ and Perfect Lifestyle exhibitions, would continue to strengthen its market position.
