NMG chairman Wilfred Kiboro (right) with Aziz Bhaloo of the Aga Khan Development Network (centre) and the British High Commissioner Dr Christian Turner during the investor briefing March 20, 2013. Photo/STEPHEN MUDIARI
What you need to know:
Linus Gitahi, the chief executive, told investors that the company closed the year with a Sh3.5 billion profit compared to the Sh2.8 billion it made in 2011.
Directors of the company have recommended a 25 per cent increase in the dividend payout to Sh10 per share from the Sh8 it paid in 2011.
Wilfred Kiboro, the chairman of the company’s board, further announced that investors will get a bonus share of one share for every five held.
Nation Media Group’s profit before tax rose by 24.7 per cent last year, driven by strong revenue growth and a decline in operating expenses.
Linus Gitahi, the chief executive, told investors that the company closed the year with a Sh3.5 billion profit compared to the Sh2.8 billion it made in 2011.
The results, which Mr Gitahi described as “impressive” came on the back of a 9.8 per cent growth in sales to Sh12.3 billion from the previous year’s Sh11.2 billion.
NMG’s direct costs dropped by seven per cent, helped by lower prices of newsprint — one of the biggest cost items for the media firm — and a return to a more stable exchange rate regime during the year.
Directors of the company have recommended a 25 per cent increase in the dividend payout to Sh10 per share from the Sh8 it paid in 2011.
Wilfred Kiboro, the chairman of the company’s board, further announced that investors will get a bonus share of one share for every five held.
“We have proposed the bonus share to reward our shareholders and boost the availability of the shares at the Nairobi Securities Exchange,” said Mr Kiboro.
NMG’s share price has posted a 77.3 per cent rise in the past one year to Sh283, recording the second highest gain among companies listed in the commercial segment of the NSE after Uchumi Supermarkets.
Mr Gitahi said the company will in the short-term focus on consolidating its businesses in the region where it has launched a number of products including newspapers, radio and TV stations.
“We have expanded aggressively and we will now focus on consolidating and growing the products we have launched,” he said.
The company has recently announced plans to launch a Nairobi newspaper to cater for specific needs of the city’s residents.
The initiative comes a month after the media house launched a weekly sports paper, Sporton! targeting sports fans.
The company also launched a Kiswahili TV station QTV in Kenya, KFM radio station in Rwanda and acquired Dembe FM in Uganda.
Mr Gitahi said NMG remains open to making new investments in the East African region, citing a healthy cash position that supports acquisition of potential targets.
NMG closed 2012 with a cash pile of Sh3.9 billion, representing a 44.2 per cent rise from the Sh2.7 billion it held a year earlier.
Mr Gitahi said the media house had posted positive results in all its divisions, including print, broadcast, and digital.
The results show the Digital Division, NTV Uganda, and Business Daily reported the highest growth in operating profits for the year.
Business Daily’s operating profit rose 187 per cent over the previous year while that of NTV Uganda increased 268 per cent of the same period.
The Digital Division posted a profit of 271 per cent above last year, with the firm betting on the wide range of products to lift its earnings in the medium term.
“The strategy of diversification that we started about 10 years ago has started paying off,” Mr Kiboro said.
He, however, warned that political uncertainty in Kenya remains a threat to overall business growth in the short term, adding that a swift and peaceful conclusion of the presidential election would determine the pace and size of investments from domestic and foreign investors.
The Supreme Court is hearing a case filed by Raila Odinga who is challenging the declaration of Uhuru Kenyatta as president-elect by the electoral body IEBC in the March 4 poll.
NMG trades in Tanzania through its subsidiary, Mwananchi Communications Limited, the publisher of Mwananchi, Mwanaspoti and The Citizen newspapers.
In Kenya, the group publishes the Daily Nation, The EastAfrican, Taifa Leo, and the Business Daily newspapers and runs two radio stations, Easy FM and QFM and two TV stations, NTV and QTV.
In Uganda, the company operates NTV Uganda while its subsidiary, Monitor Publications, publishes Daily Monitor newspaper, the Monitor Telephone Directory, operates KFM radio station and the newly acquired Dembe FM.
