Media Prima has posted an 11% dip in traditional advertising revenue and a 12% dip in circulation revenue for the financial year ended 31 December 2019 (FY19). This contributed to the 7% decline in revenue to RM1.1 billion for FY19 against the corresponding year.
Barring exceptional items, its loss after tax narrowed by 35% to RM69.4 million in FY19, against RM106.0 million a year ago. That said, its digital and commerce segments saw a 4% revenue increase to RM320.2 million in FY19. In digital, Media Prima Digital’s REV Asia posted a 8% revenue increase to RM44.7 million in FY19. According to the financial statement, the increase underscores the success of its content marketing strategies. Media Prima Television Network’s home shopping segment, CJ Wow Shop, recorded a 9% revenue increase to RM232.3 million and a 13% increase in quantity of items sold. Total customers increased by 13% in FY19 and by 1% year-on-year since 2016.
Meanwhile for the fourth quarter ended 31 December 2019 (Q4 2019), group revenue increased by 5% to RM304.6 million against RM290.9 million in the corresponding quarter last year. Media Prima would have posted a profit after tax of RM9.7 million in Q4 2019 versus a loss after tax of RM38.5 million last year, if exceptional items reported in both quarters were excluded. The exceptional items included the execution of an internal restructuring exercise in Q4 2019, and a one-off gain from a sale and leaseback arrangement in 2018.
Last December, Media Prima confirmed that it will proceed with its manpower rationalisation exercise as part of the next phase of its business transformation exercise announced on 1 November. The statement was released after Malay Mail reported that Media Prima will allegedly cut the number of editorial staff at the New Straits Times, Berita Harian, and Harian Metro by half. It added that Media Prima’s broadcasting arm is expected to be the most heavily impacted by the job cuts.
The group also announced that it has concluded the first phase of its transformation plan, Odyssey, which began in 2016. In view of legacy issues and new technologies which had affected revenue from its traditional media businesses, Media Prima said it has been undertaking workable and sustainable options to restructure the group. The first phase focused on revenue diversification across three key areas — digital, commerce, and beyond Malaysia, and involved strategic acquisitions, and partnerships with global technology and media companies.
In the financial statement, Media Prima said it believes that Odyssey has provided the necessary foundation for corporate recovery in the future as these initiatives have contributed greater revenue to the group year-on-year. In 2019, Odyssey revenue reached RM318.0 million, contributing to 29% of the group’s total revenue compared to RM176.4 million or 15% of total revenue in 2017.
Kamal Khalid, group managing director of Media Prima, said the group’s significant investments in Odyssey has put it on a stronger foundation to compete in today’s fast-evolving digitally-driven media environment.
“Our rationalisation and restructuring will make us a leaner and more agile company, better suited to navigate the uncertainties ahead. We are equipped to face the future because of the energy and commitment of our team to transform Media Prima into a leading digital-first media company,” he said.