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Your 60-Second Guide To Singapore Press Holdings (SGX: T39) Shares

profileSudhan P

In this series, we will feature one Singapore-listed company each time. It serves as a quick guide to everything you should know about it in 60 seconds. 

In this instalment, we look at Singapore Press Holdings Limited (SGX: T39), your friendly national newspaper publisher. 

What’s SPH’s Business About? 

Singapore Press Holdings Limited (SPH) is Asia’s leading media organisation. 

Its main business is in the publishing of newspapers, magazines and books in both print and digital editions. Some of the papers published by SPH include The Straits Times, The Business Times, Lianhe Zaobao, Berita Harian, and Tamil Murasu

SPH also has a property arm that holds, manages, and develops properties. 

This segment includes a 70% stake in SPH REIT (SGX: SK6U). SPH REIT is a retail real estate investment trust that has interests in Paragon, The Clementi Mall, and The Rail Mall in Singapore.

Over in Australia, the REIT owns a 50% interest in Westfield Marion Shopping Centre and an 85% stake in Figtree Grove

SPH also owns The Seletar Mall and a portfolio of purpose-built student accommodation (PBSA) in the United Kingdom. 

The media giant has other businesses such as online classifieds, radio stations, and outdoor advertising as well. Not many may know this, but SPH owns Singapore’s largest private nursing home operator, Orange Valley, too. 

Furthermore, SPH has a 20% stake in education company, MindChamps PreSchool Ltd (SGX: CNE), and telco M1. 

SPH’s Financial Highlights 

The following shows SPH’s operating revenue and profit before tax margin for each business segment from 2016 to 2020 (the company’s year ends on 31 August each year): 

Source: SPH FY2020 annual report

Overall, we can see that the media segment’s revenue has been on a downtrend. SPH makes the most amount of money from print advertisements.

With the proliferation of online advertising, this segment has been disrupted severely. The availability of free news from websites has not helped things either.

For SPH’s FY2020, the company’s operating revenue fell 9.8% year-on-year to S$865.7 million while operating profit plunged 41%.

SPH saw a net loss of S$83.7 million in FY2020, compared to a net profit of S$213.2 million a year ago.

SPH’s Dividend History

SPH’s dividend has been on a downtrend as well over the years: 

Source: SPH investor relations website

SPH’s total dividends (including special dividends) has fallen from 18 Singapore cents per share in 2016 to just 2.5 cents per share in 2020. 

SPH’s Major Risk to Take Note Of

The main risk with SPH is that of digital disruption, which has already hit its business as seen earlier.

SPH has invested more money in the non-media sector to further diversify its business. 

SPH’s fortune hinges on it turning around its overall business successfully. If that doesn’t happen, investor sentiments surrounding the company might be hit further.

SPH’s Share Price and Valuation 

SPH’s share price performance in the last five years has been ugly, having fallen 70% since December 2015. 

Source: Google Finance

At SPH’s current share price of S$1.16, it has no price-to-earnings (P/E) ratio to speak of as it ended FY2020 with a loss. Its dividend yield stands at 2.2%.   

Want to Discuss Further?

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Stock Discussion on Singapore Press Holdings Limited

Disclaimer: The information provided by Seedly serves as an educational piece and is not intended to be personalised investment advice. ​Readers should always do their own due diligence and consider their financial goals before investing in any stock.

About Sudhan P
It isn't fair competition when only one company in the world makes Monopoly. But I love investing in monopolies. Before joining the Seedly hood, I had the chance to co-author a Singapore-themed investment book – "Invest Lah! The Average Joe's Guide To Investing" – and work at The Motley Fool Singapore as an analyst.
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