SCMP signs six-year printing deal with free paper am730
SCMP Group has signed a six-year printing deal worth up to HK$324 million with free daily newspaper am 730.
The group said yesterday it bought new printing presses from Germany's Manroland Web Systems to print the Hong Kong paper.
"While most of the publishing world is scaling back, the SCMP is defying this trend by increasing our print production facility," SCMP Group chief executive Robin Hu said at a ceremony to unveil the new equipment.
SCMP said it expects a cash payback on its investment in four years. The company needed to purchase three towers of double print press to fulfil the terms of the contract that takes effect on July 30, to ensure am730's print run of 450,000 copies at a maximum of 96 pages.
am730, one of Hong Kong's six free newspapers, was established by Shih Wing-ching, co-founder of Centaline Property Agency.
"Hong Kong has a robust print newspaper market still, a source of envy for newspaper publishers around the world," Hu said.
"In this market of seven million people, there are four million newspapers printed daily, possibly the highest in the world on a per capita basis.
"Our considerable investment in this brand new press facility … is the result of our faith in am730 as a strong partner, our continued commitment to print and our confidence in the resilience of our industry."
SCMP Group, which owns the South China Morning Post, envisages an annual contribution to operating profit of at least HK$13 million to HK$22 million.
Louis Tse Ming-kwong, director of VC Brokerage, said the agreement would provide a new income stream for SCMP Group.