SCMP profits fall on rising staff costs, property plays

SCMP Group, the publisher of the South China Morning Post, 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.

Revenue increased 11 per cent year on year to HK$509.1 million in the six months to June, driven by higher advertising sales from its magazine publishing business and higher rental income from investment properties, the company said in an interim results statement.

The group publishes the South China Morning Post, Hong Kong's only paid-for English-language newspaper, Chinese-language versions of Cosmopolitan and Harper's Bazaar magazines, and the Hong Kong edition of ELLE 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.