by Jay Kew 
PETALING JAYA: Star Media Group Bhd (SMG) reported a notable rise in pre-tax profit, reaching RM5.5 million in the fourth quarter of 2023 (4Q23), compared to RM1.7 million in the same quarter last year. This increase was largely due to the sale of an investment property valued at RM6.5 million. Despite this, the group’s total revenue for 4Q23 saw a 7% decline, amounting to RM55.1 million compared to 4Q22.
Looking ahead to 2024, SMG conveyed a cautious outlook on industry advertising expenditure in its filing with Bursa Malaysia. The group is focused on discovering new revenue streams while ensuring operational efficiency and cost control. SMG remains hopeful that its property development and investment segment will continue to positively impact the group’s revenue and profitability. Additionally, the group is actively seeking merger and acquisition opportunities to strengthen its existing businesses.
Breaking down its performance, SMG’s property development and investment division generated RM4.7 million in revenue for 4Q23, a substantial increase from RM1.1 million in 4Q22. This boost was primarily due to the recognition of revenue from the sale of units in the Star Business Hub project and higher occupancy rates in its investment properties. Consequently, the segment reported a pre-tax profit of RM7.7 million in 4Q23, reversing a pre-tax loss of RM0.9 million in 4Q22.
Conversely, the print, digital, and events segment experienced a 9% drop in revenue, falling to RM45.6 million in 4Q23 from RM49.9 million in 4Q22, resulting in a pre-tax loss of RM2.5 million compared to a pre-tax profit of RM1.2 million in 4Q22 due to weaker market sentiment.
The radio broadcasting segment also faced challenges, with a 25% decrease in revenue to RM6.5 million in 4Q23 from RM8.7 million in 4Q22, leading to a pre-tax loss of RM0.1 million compared to a pre-tax profit of RM1.1 million in 4Q22 due to higher operating costs.
For the full financial year 2023 (FY23), SMG’s revenue remained steady at RM220 million, matching the revenue of FY22. The group recorded a pre-tax profit of RM8.3 million in FY23, slightly down from RM8.8 million in FY22.
The print, digital, and events segment achieved RM184.1 million in revenue for FY23, nearly identical to RM184.7 million in FY22. This segment reported a pre-tax loss of RM1.3 million in FY23, a decline from a pre-tax profit of RM4.5 million in FY22, mainly due to increased operating costs.
The radio broadcasting arm saw a 19% drop in revenue to RM27.2 million in FY23 from RM33.6 million in FY22, with a pre-tax profit of RM0.1 million in FY23 compared to RM7.2 million in FY22.
In contrast, the property development and investment segment showed significant growth, generating RM12.3 million in revenue for FY23, up from RM3.2 million in FY22, driven by the sale of Star Business Hub units and higher occupancy rates. This segment recorded a pre-tax profit of RM8.1 million in FY23, a significant improvement from a pre-tax loss of RM4.2 million in FY22.
SMG’s strategic move into the property sector has effectively boosted its revenue and profitability. With the Star Business Hub project slated for completion by the end of this year, we eagerly anticipate the value it will add and the new industrial opportunities it will bring to the market.
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Reference: The Star