KUALA LUMPUR (Aug 27): Media Prima Bhd’s net loss narrowed to RM20.11 million in the second quarter of the financial year ended June 30,2020 (2QFY20) against the immediate preceding quarter at RM29.54 million, on the back of lower operating expenses and increased home shopping, but was dragged by the one-off termination benefits charge of RM11.3 million.

It said the group would have posted a loss before tax of RM5.8 million in 2QFY20 if the one-off termination benefits charge was excluded.

This is the group’s sixth quarterly loss-making quarter. Media Prima last posted a quarterly profit in its 4Q2018 registering a net profit of RM79.2 million then.

In 2QFY20, Media Prima’s loss per share was 1.81 sen versus 2.66 sen for 1QFY20, the group’s filing with Bursa showed.

While revenue for the quarter inched down 0.91% quarter-on-quarter to RM236.28 million from RM238.44 million due to reduction in advertising revenue, it was offset by the increase in home shopping revenue that coincided with the Movement Control Order (MCO) imposed by the Government.  

Media Prima saw its home shopping revenue increase significantly by 48% in 2QFY20 compared with 2QFY19 due to the shift in consumers' shopping habits during the MCO period.

Nevertheless, the group’s net loss expanded 129% to RM20.11 million in 2QFY20 from RM8.8 million a year earlier.

For the cumulative six-month period ended June 30, net loss stood at RM49.65 million, almost similar to the RM49.24 million recorded a year ago. Cumulative revenue shed 11.41% to RM474.71 million from RM535.87 million.

Delving into its business operating segments with external customers, only three out of seven of them made money for the period ended June 30.

The three businesses were out-of-home with a segmental profit of RM844,000, digital media at RM5.7 million, and home shopping that turned profitable with an RM6.3 million profit for the segment versus a segmental loss of RM7.6 million a year earlier.

The segmental loss-making business units for the period ended June 30 were — broadcasting, publishing, content creation and Omnia, its integrated marketing solutions unit.  

On prospects, the group foresees the second half of 2020 to remain challenging as it continues to face cautious business and consumer sentiment brought about by the COVID-19 pandemic.

“The group has expedited the next phase of its transformation exercise which include revising revenue models and corresponding cost management involving operational changes at selected units to address cost inefficiencies arising from work duplication,” it added.  

Meanwhile, the group seeks to continue the momentum of its commerce business after an encouraging first half performance. Digital and branded content solutions will be areas of significant growth for the group in facing an already soft adex environment.

Media Prima stock price fell one sen or 5% at 19 sen, valuing it at RM210.75 million. For the past year, the stock has fallen 60% from 48 sen.