Clear Media may cut bus shelter ads to drive sales
Clear Media, a Hong Kong-listed mainland outdoor media company, yesterday said it may cut the price of bus shelter advertising in the second half because of the unfavourable economic environment.
The company lifted its average price by 9 per cent in the first half, which, together with the 'challenging economic climate' and 'an increase in total number of panels', resulted in a slight decline in the overall occupancy rate to 57 per cent.
'The global economy is not likely to recover in the short run, and China's economy will be increasingly affected by the external environment,' said chief operations officer Harrison Zhang.
He said the market faced more uncertainties in the second half than the first and the company would adjust its prices and seek new clients to achieve its full-year targets.
Despite the challenges, confirmed orders have already reached about 80 per cent of the company's full-year target.
Zhang said the company would stick to its goal of 3,000 to 4,000 new bus shelter billboards this year. By the end of June, the company had a total of 36,000 billboards in 28 cities on the mainland. It no longer offers advertising on the buses themselves.
Revenue from bus shelter advertising, its core business, increased by 13.4 per cent to HK$715 million for the first half compared with a year ago. The company has other businesses but they didn't generate any revenue in the first half. Consequently, the group's total turnover was HK$715 million, up 3.4 per cent from a year earlier. Net profit rose 15.5 per cent to HK$84 million.
Earnings per share rose 15.5 per cent to 15.90 HK cents. No interim dividend was declared. It paid a maiden final dividend of 5 HK cents a share for last year but has yet to make a decision on dividends for this year.