KUALA LUMPUR (Aug 20): Star Media Group Bhd (KL:STAR) is staring at a potential earnings gap without new property projects while its mainstay print business grapples with persistent losses, analysts said.
Net income for its first six months announced on Tuesday came in at only 1% of the consensus full-year estimates, prompting sharp cuts to earnings forecasts. Kenanga Investment Bank, one of three research houses covering the stock, expects the company to slip into the red this year.
“An earnings gap looms if no new property projects are launched to replace the completed” Star Business Hub, the research house flagged, warning that “the loss of this key profit driver could push the group into the red in upcoming quarters”.
Shares of Star Media, which publishes the most circulated paid English newspaper in Malaysia, slipped 1% to 37.5 sen on Wednesday following the results announcement.
The company has been grappling with dwindling subscribers and advertising revenue amid the proliferation of online news and media. Star Media diversified into property business, developing a 5.05-acre industrial site in Shah Alam, Selangor into the Star Business Hub.
Meanwhile, its print, digital, and events segment had six consecutive quarterly losses before reporting a small pre-tax profit in the latest quarter ended June 30, 2025 (2QFY2025).
“In the near term, we anticipate continued weakness in Star’s core print and radio broadcasting segments, as advertisers remain cautious on spending amid inflationary pressures and broader macroeconomic challenges,” said TA Securities.
Both Kenanga and TA Securities have the stock on ‘sell’ calls.
Star Media slipped into the red with a net loss of RM231,000 in 2QFY2025, which nearly wiped out its year-to-date earnings. For the first half of FY2025, Star Media’s net profit plunged 98.9% to a mere RM83,000.