SINGAPORE (Kyodo) -- Singapore Press Holdings Ltd., a leading media company in the city-state, said Thursday it will turn its newspaper publishing business into a not-for-profit company due to shrinking advertising revenue amid a fiercely competitive media landscape.
The company, which had enjoyed a near monopoly of the print newspaper publishing in Singapore that made it one of the richest media companies in Asia before the internet era, said in a statement that it "will be transferring its media business to a not-for-profit entity amidst the ongoing challenge of falling advertising revenue."
Under the restructuring proposal, SPH Media will eventually be transferred to a not-for-profit entity in the form of a newly formed public company for a nominal sum, with the transfer expected to be completed by as early as the end of this year.
Badly hit by the more competitive media environment and the prolonged economic crisis triggered by the coronavirus pandemic, the firm recorded its first-ever loss of S$11.4 million (US$8.5 million) for the financial year ended Aug. 31 last year. Profit before tax for the six months that ended in February this year fell 71 percent to S$3.1 million compared with the same period last year.
The losses in its media business are likely to continue and widen, it said.
Despite the daily circulation of the digital version of its English-language newspaper The Straits Times, surpassing the print newspaper circulation, this has not been able to offset the decline in print advertising and print circulation revenues.
"Given this public role, winding up the media business or selling it off are not feasible options," it said.
On the other hand, "a not-for-profit structure that allows SPH Media to seek funding from a range of public and private sources with a shared interest in supporting quality journalism and credible information is the optimal solution," it said.
The company has a stable of newspapers in different languages aside from The Straits Times and The Business Times. It also publishes Chinese-language, Malay-language and Tamil-language newspapers to cater to Singapore's multiracial population.
The transfer of the media assets to a newly formed public company limited by guarantee, or CLG, is subject to SPH shareholders' approval at an extraordinary general meeting, expected to be called in early July.