KUALA LUMPUR: Media Prima Bhd slipped into the red in its fourth quarter of financial year 2014 ended Dec 31 (4QFY14) with a net loss of RM29.49 million or 2.67 sen per share from a net profit of RM63.44 million or 5.81 sen per share a year ago due to expenses incurred for its mutual separation scheme (MSS).

Excluding the one-off MSS effect, the group’s net profit declined by 13% from 4QFY13, said Media Prima in its filing with Bursa Malaysia yesterday.

Its revenue for the quarter also came in lower at RM384.7 million, down 14.8% from RM451.56 million in 4QFY13.

Despite the weaker financials, the group has announced a final dividend of five sen per share for 4QFY14, bringing the total dividend for the year to 11 sen per share, which is 21.4% lower than the 14 sen per share in FY13.

The weak quarterly result also dragged its FY14 net profit down 64.7% to RM75.53 million or 6.83 sen per share, from RM214.02 million or 19.62 sen per share in FY13.

The company attributed the weaker full-year earnings to market uncertainties, weak consumer sentiments and the tragic airlines incidents that had caused advertisers to take a more cautions stance on advertisement placement.

“We closed the year with the worst flood the country had seen in many years. As part of the group’s rationalisation and consolidation plan, the group undertook a MSS towards end of 2014. If the MSS amount was excluded, the [full-year] profit after tax for the group contracted by 35%,” it said.

Revenue in FY14 slipped 12.5% to RM1.51 billion from RM1.72 billion in FY13.

Going forward, Media Prima (fundamental: 1.8; valuation: 1.2) is bracing for a challenging year in 2015 on a lower economic outlook, prevailing low oil prices and the forthcoming implementation of the goods and services tax in April.

“In view of these challenges, the group seeks to grow its non-traditional revenue while consolidating its market share in core advertising revenue.

“At the same time, the group will continue to manage and improve its costs by monitoring its key cost drivers, coupled with the implementation of group-wide cost saving initiatives,” it said.

Media Prima will also continue to expand its multiplatform content production for markets beyond its television network, while concurrently enhancing its respective platforms’ business strategies in print media, outdoor media, radio network, digital media and content creation.

This article first appeared in The Edge Financial Daily, on February 26, 2015.