KUALA LUMPUR (May 29): Star Media Group Bhd slipped into a net loss of RM3.98 million for the first quarter ended March 31, 2020 (1QFY20), versus a net profit of RM3.54 million a year ago amid lower revenue from the print media segment.

The media group last reported a loss-making quarter in 4QFY18 of RM9.1 million.

Nonetheless, Star Media said its board of directors is confident the group is well positioned to weather through these unprecedented challenges given its big warchest.

With a cash reserve of more than RM300 million with no borrowings, the group said, this will serve as a solid base for it to capitalise on merger and acquisition opportunities during the market consolidation, and even penetrate into new businesses that have a promising outlook.

The group’s quarterly revenue declined 20.36% to RM65.76 million from RM82.57 million, according to a filing to the local bourse today.

Under the print and digital segment, it saw a loss before tax of RM4.47 million in 1QFY20, versus a profit before tax of RM3.65 million in 1QFY19 due to lower revenue as a result of softness in the Malaysian economy coupled with the effects of COVID-19 and the subsequent Movement Control Order (MCO) which further exacerbated the revenue loss in the second half of March 2020.

On prospects, the group still expects revenue growth from its digital segment despite soft and challenging market conditions.

“The group will focus on using new technologies and analytics to improve, deepen and predict how our customers consume content with the end goal of increasing engagement and monetisation to drive new revenue streams beyond print,” said Star Media, adding that there was also an increase in traffic across the group’s digital platforms during the MCO period.

With its existing growth in digital platforms, Star Media hopes to increase the advertising take-up rates during these uncertain times and achieve a higher growth in the near future.

Additionally, the group has embarked on various cost-cutting measures and efforts are also being directed at restructuring some of the business units within the group to re-strategise operations, which include manpower rationalisation and realignments in how the company get back into the market, especially post MCO, said Star Media.

Star Media’s shares closed half a sen or 1.39% higher at 36.5 sen today, valuing the company at RM269.58 million. Over the past year, the counter has fallen some 43% from 64.5 sen.