This article first appeared in The Edge Financial Daily on November 29, 2017
KUALA LUMPUR: Media Chinese International Ltd’s (MCIL) second-quarter net profit dropped 34.4% to RM14.25 million from RM21.72 million a year ago, as revenue declined amid challenging market conditions.
In a filing with Bursa Malaysia, MCIL said top line for the quarter ended Sept 30, 2017 (2QFY18) came in at RM337.23 million, down 6.5% compared with RM360.83 million previously, mainly due to a fall in the turnover of the publishing and printing business, especially for the Malaysia and Southeast Asia (SEA) segments.
However, the decline was partially offset by a 6.4% rise in the turnover of the travel segment totalling US$27.23 million (RM111.92 million), thanks to the growth of its outbound travel business for the North America tour operations, as outbound travel became relatively cheaper due to stronger US and Canadian dollars.
MCIL declared a first interim dividend of 0.25 US cents for the year ending March 31, 2018 (FY18), payable on Dec 29.
The group said cumulative net profit for the six months ended Sept 30, 2017 (1HFY18) fell 43.7% to RM24.17 million, from RM42.93 million a year earlier. Revenue dropped 8.7% to RM648.68 million from RM710.36 million.
The group added that the ringgit and Canadian dollar weakened against the greenback during 1HFY18, resulting in a negative currency impact on the group’s operating results for the period.
MCIL group chief executive officer Francis Tiong said market conditions in 2HFY18 are expected to remain challenging. It is likewise for the print media, whereby advertising spending will remain slow given the still weak consumer spending and the continuing shifting of print advertising dollars to major digital and social media players such as Google and Facebook.
“Newsprint price has also started showing signs of an upward trend which will put further pressure on the group’s performance,” Tiong said.“Nevertheless, the group will continue its efforts in developing innovative marketing packages, integrating its print and digital businesses, enhancing its digital infrastructure, building its digital content and ensuring that its products and content stay competitive and relevant to its readers.”