Star Media swings to black in 3Q amid reversal of compensation income

KUALA LUMPUR (Nov 22): Star Media Group Bhd recorded a net profit of RM2.2 million or 0.30 sen per share in the third quarter ended Sept 30, 2022 (3QFY22), versus a net loss of RM54.76 million or 7.56 sen per share in the previous year’s corresponding quarter, mainly attributed to the reversal of compensation income of RM50.5 million.

Revenue for the quarter under review grew 15.97% to RM53.63 million compared with RM46.24 million previously, Star Media told Bursa Malaysia in a filing on Tuesday (Nov 22).

The group’s print and digital segment posted a profit before tax (PBT) of RM400,000 versus a loss before tax (LBT) of RM54.8 million.

“3Q2022 revenue has increased by 12% against 3Q2021, mainly driven by operational enhancement which has led to improvement in advertising bookings,” it said.

Radio broadcasting segment generated a higher revenue by 40%, amounting to RM7.8 million from RM5.6 million. This segment’s PBT jumped to RM1.2 million from RM100,000, driven by higher revenue contribution of commercial airtime.

LBT for the event and exhibition segment, meanwhile, narrowed to RM200,000 in the quarter, a marginal improvement from RM300,000 previously.

Compared to the immediate preceding quarter, the group’s net profit rose 21.41% from RM1.81 million in 2QFY22. Revenue was up marginally from RM53.215 million in 2QFY22, due to an increase in revenue of print and digital, offset by high operating expenses arising from the newsprint costs amid weakening of the ringgit against the US dollar.

For the nine months ended Sept 30 (9MFY22), Star Media registered a net profit of RM6.53 million against a net loss of RM106.71 million. This was driven by a higher revenue of RM158.95 million, up 17.22% from RM135.6 million a year earlier.

According to Star Media, the reopening of the economic activities has led to an improvement in consumer sentiment, which resulted in an increase in advertising bookings, as businesses have resumed operations at optimal level.

“This strong demand has translated into growth in our financial performance. Despite the improvement, we expect market conditions to remain volatile, in view of inflationary pressures and geopolitical fragmentations,” it said.

Further, Star Media said it will remain financially prudent and continue to improve its operational efficiencies.

Additionally, the group will also continue its efforts in retaining and sustaining its investments in its digital transformation initiatives and strategies with various digitally-driven products such as The Star Online, mStar and the newly-launched BM news portals, Majoriti and Majoriti 7, which aim to further strengthen Star Media’s market share in the Malay community.

Star Media closed unchanged at 28.5 sen on Tuesday, for a market capitalisation of RM214.25 million. It saw some 235,300 shares exchanging hands.