SCMP Group, publisher of the South China Morning Post , reported net profits of HK$208.7 million for the first six months of the year, with valuation gains on investment properties and a partial asset sale boosting earnings from normal operations, the company said in a filing to the Hong Kong stock exchange. Profits excluding these gains were a more muted HK$28.3 million versus HK$48.2 million in the same period a year ago, as a lacklustre Hong Kong economy weighed down by weak retail spending - particularly in the luxury sector - a narrowed pipeline of new share listings and stock market volatility around the world caused advertisers to pull back spending. "Entering the second half of 2015, signs of significant recovery have not been apparent. In spite of this, the group's fundamentals are strong, and the company remains on its path to continue fortifying existing revenue drivers, while growing digital-specific revenues, and expanding overseas readership," SCMP Group chief executive Robin Hu said in a statement accompanying the results. "Of note, the company's diverse product portfolio that includes print, digital, outdoor and events, collectively increases the group's resilience during challenging times," Hu said. "Efficiency improvement programmes are already in place to strategically reduce operating expenses and optimise our processes to nurture homegrown talent, innovate green-field products, and capture emerging opportunities. By activating these growth strategies, together with prudently managing our strong fundamentals, the group looks forward to building and managing our future growth." Total revenue for the first half was HK$549.3 million, 8 per cent down on a year ago. Staff costs rose 2 per cent or HK$4.2 million, mainly due to increases in salary that were largely offset by tighter headcount controls. Production costs decreased 14 per cent or HK$15.1 million, due to lower newsprint costs and lower production costs for magazines. An 8 per cent drop in revenue at the group's newspaper division - its biggest business line - was partly mitigated by higher revenues from digital subscriptions and online advertising. Overall circulation of the South China Morning Post and Sunday Morning Post remained stable. Digital subscriptions continued to grow strongly. Total circulation revenue grew 2 per cent. The SCMP Group has been rolling out a digitisation strategy for "future-proofing" the group, while expansion into international markets in recent years has helped grow the group's revenues from overseas markets. Integral to these initiatives has been building on the brand positioning of the South China Morning Post as the world's best independent news and information source on China. Trading in shares of the SCMP Group has been suspended since February 2013 when the public float fell below 25 per cent. The company has been exploring ways to resolve the issue and afford shareholders the opportunity to realise their investment. A buy-back proposal submitted to substantial shareholders in 2014 was ended this year after failing to secure their agreement to it. The company said no further progress had been made on the issue as of June 30 and further announcements would be made when appropriate to update shareholders on any material change.