Queries from Minority Shareholder Watchdog Group

Transcription

1 Queries from Minority Shareholder Watchdog Group

2 MPB response to MSWG questions Q1. As stated in the Chairman s Statement, enriching the ecosystem is critical to Media Prima. (i) What critical steps have been taken to focus on the issue and ensure any plans would jeopardise the Group s survival and what is the latest development? Enriching the ecosystem requires the Group to focus on its core competency in producing compelling content for its target market, optimizing synergies through its reach of 25 million Malaysian daily and its ability to adapt to rapid evolution of technology and consumer behavior by continuously re inventing ourselves to remain relevant. In the past, the Group had only focused on content creation for its own traditional platforms TV Networks and Print group consumption. It has since moved into producing content beyond its TV and Print, also for Digital, broadcasters beyond Media Prima and beyond Malaysian shore. To date, the Group has become a content supplier to Hypp TV, an IPTV of Telekom Malaysia and ABN Excess, a new Pay TV/ cable player. It has also made inroads into Singapore market by supplying content to Mediacorp, Singtel and Starhub. In order to meet the ever changing demands of consumers, the Group acknowledged that content has to be platform agnostic i.e. content which can travel and be offered for consumption via multi platform/devices. The Group has also completed consolidating all its digital assets under Media Prima Digital. Apart from providing online and digital support for all platforms, it offers consumers access to our content via their platform and device of choice, anytime anywhere.

3 Q1. As stated in the Chairman s Statement, enriching the ecosystem is critical to Media Prima. (ii) Overall, can the Board elaborate which areas need further improvements? In order for us to enrich the ecosystem, the Group acknowledges that it needs to continuously improve and innovate the whole aspect of its business. Thus, there is a vital need for the Group to align the mindset and skill sets of its workforce.

4 Q2. We noted that revenue from Print Media segment had declined to RM710.9 million in FY2013 from RM731.1 million in FY2012. The segment profit had also dropped to RM56.2 million from RM63.6 million over the two years. Please explain the poorer results and what can and have been done to address the problem. We were not spared by the challenges faced by the Print Media worldwide. The lower circulation is in tandem with circulation trend of newspapers as a result of change in consumer behaviour i.e. increasing preference for online content and news. Whilst sustaining revenue growth is challenging, managing the rising costs is also a challenge. The reasons for the decrease in PAT are due to the (i) increase in human resource cost, (ii) increase in direct costs and (iii) decrease in advertisement and circulation revenue during the 2nd half of Despite the worldwide scenario, the Group will enhance its monetizing efforts especially in the lucrative Malay market segment, continuously looking at innovative solution offerings and business process improvement initiatives to manage its operating costs.

5 Q3. Revenue from Television Networks segment rose by 2.09% in FY2013 while EBITDA and profit decreased by 7.9% and 11.4% respectively. What were the reasons for the drop in EBITDA and profit and what measures have been taken to arrest the decline? TV Networks revenue grew by 2% in FY2013 against FY2012. This is however offset by higher operational costs/overheads and continuous investment in quality content resulting in EBITDA and PAT to decrease by 8% and 11% respectively. Content costs have increased in line with the Group s commitment to continue to invest in quality content. While this affects the short term profitability of TV Networks, it provides medium to long term opportunity to monetize from the content itself.

6 Q4. Compared to its rivals in the market, please share with shareholders the relevant data such as market share in terms of readership and advertising revenue for newspapers and listenership, etc. a. Market share in terms of readership and advertising revenue for both the English newspapers as well as Bahasa newspapers separately. Combined Readership Dailies and Sundays in 2013 Market Share of Advertising Expenditure in 2013 English Newspapers Total ( 000) New Straits Times / New Sunday Times 309 The Star/ Sunday Star 1,099 Bahasa Malaysia Newspapers Berita Harian/ Berita Harian Ahad 1,321 Harian Metro/Metro Ahad 4,622 Utusan Malaysia/ Mingguan Malaysia 1,052 Kosma/Kosmo Ahad 987 Sinar Harian/Sinar Ahad 1,051 English Newspapers Total (RM Million) New Straits Times / New Sunday Times The Star/ Sunday Star The Sun 64 8 Bahasa Malaysia Newspapers Berita Harian/ Berita Harian Ahad Harian Metro/Metro Ahad Utusan Malaysia/ Mingguan Malaysia Kosma/Kosmo Ahad %

7 Q4. Compared to its rivals in the market, please share with shareholders the relevant data such as market share in terms of readership and advertising revenue for newspapers and listenership, etc. b. Listenership as a whole compared to other competitors. Listenership in English Stations: Listenership in Bahasa Malaysia Stations: Fly FM overall Malaysia s No. 2 most listened to English radio station. Hot FM No. 3 most listened Malay radio station & No. 2 most listened to Malay radio station in the East Coast Source: Radio Audience Measurement (RAM) Survey

8 Q4. Compared to its rivals in the market, please share with shareholders the relevant data such as market share in terms of readership and advertising revenue for newspapers and listenership, etc. b. Listenership as a whole compared to other competitors. Listenership in Chinese Stations: One FM ranked as the No. 3 Chinese Radio Station. Source: Radio Audience Measurement (RAM) Survey

9 Q5. As reported (Page 11 of AR) Media Prima cannot be a one or two platform outfit and media companies must meet customers demand for content across platforms and across multiple devices. The customers expect Media Prima to be a one stop center for customers media solutions. How has the Board strategized to address the issue and what are the latest developments? We have highlighted earlier in our answer to Question 1 that the Group acknowledged that content has to be platform agnostic i.e. content which can travel and be offered for consumption by every platform/ device of choice with the main objective of meeting the ever changing demands of consumers. With regards to being a one stop center for customers media solutions, platform integration is key in this matter. Through integration, the Group will be able to optimize its resources to come up with an integrated solution.

10 Q6. MSWG is promoting certain standards of corporate governance best practices in PLCs. In this regard, we would like to encourage the Board to publish the salient points of the minutes of the general meetings on the Company s website in line with the spirit of transparency and good corporate governance. We take note of this and will endeavour to upload the salient points of the minutes of general meetings on the Company s website.