SCMP profits fall on rising staff costs, property plays
Higher staff costs and a decline in property investment gains shave 41pc off the group's interim earnings as magazine advertising boosts revenue
SCMP Group, the publisher of the , posted a 41 per cent drop in first-half net profit to HK$105.2 million from a year earlier as staff costs rose and gains booked on property investments fell.
The group publishes the , Hong Kong's only paid-for English-language newspaper, Chinese-language versions of and magazines, and the Hong Kong edition of magazine.
Staff costs rose 26 per cent to HK$236.9 million in the first half. The group had 966 employees, up from 939 at the end of 2012.
The statement said revenue from newspaper publishing was static, constrained by a slowdown in the local economy and an inactive recruitment market.
The group said it would continue to strengthen its product portfolio and brands to develop new revenue streams.
Online advertising revenue grew 19 per cent and remained on an upward trend, while circulation was stable despite an increase in the price of the in print and online.
The statement said the outlook remained cautious amid signs of advertising activity in the banking and finance and overseas property sectors.
It said that while some fashion brand advertisers were spending, the retail business remained lethargic and the outlook for initial public offerings was still soft for the coming six months.
Total newspaper revenue fell 1 per cent to HK$365.5 million.
The company declared an interim dividend of two HK cents per share.
Trading in SCMP shares has been halted since February 26 after the group's public float fell to 10.6 per cent, below the minimum requirement of 25 per cent. Kerry Media, the controlling shareholder, exercised its rights to 14.4 per cent of the firm's issued share capital held by three banks.
Before the suspension, the stock had gained nearly 20 per cent this year.
