Press Release

PETALING JAYA: The proceeds from Star Media Group Bhd’s proposed disposal of its 52.51% equity interest in Singapore-listed Cityneon Holdings Ltd will enable the group to further diversify into non-print related businesses.

Star Media Group chairman Datuk Fu Ah Kiow said the transaction, if approved, would allow the group to unlock the value of its investment.

“Two weeks ago, the board made the decision to dispose of the entire stake in Cityneon (for S$115.61mil or about RM360mil). We are in the process of preparing the circular to shareholders for Bursa Malaysia’s approval so that we can call for an EGM,” Fu said, adding that questions arising from the disposal would be answered during the EGM.

“Taking everything into consideration, perhaps it is the best time to unlock the value of this investment in Singapore, and with the money that we have, we will be able to invest in other business,” he added at the company’s AGM on Monday.

Going forward, Fu said the future of Star Media Group involved increasing sources of revenue other than print.

To a question if shareholders could expect a bumper dividend after the disposal of Cityneon, Fu said the board would discuss the matter “when it comes to that”.

He noted that Star Media Group had a good dividend yield track record.

Star Media Group is ranked among the top companies on Bursa Malaysia for consistently paying out good dividends and being able to generate positive operating cash flows over the last 10 years.

According to statistics compiled by independent research firm equitiestracker.com, Star Media Group has a rolling four-quarter dividend yield of 7.34%.

The latest dividend paid out by Star Media Group was nine sen per share that was announced along with its first-quarter results on Feb 27. The total dividends that were paid out to shareholders for the financial year ended Dec 31, 2016, amounted to 18 sen per ordinary share.

At the current price of RM2.48, Star Media Group shares provide a 7.258% dividend yield.

Fu said while the group continued its diversification into non-print revenue businesses, the group would also improve its efficiency, productivity and cost control amid the challenging economic environment.

Print remains the cash cow of Star Media Group but its revenue contribution has been declining over the years. The group has been growing the contribution from its digital business to supplement the print division.

Nonetheless, the company expects the percentage of digital contribution to increase significantly in the near future.

As at June 30, 2016, the ratio of print to e-paper circulation was 69:31. The group target the ratio to be 65:35 in FY17.

Meanwhile, Fu said the group’s OTT (over-the-top content), dimsum, was not expected to contribute significantly to the group’s revenue in FY17 given that it was only launched in November 2016.

Dimsum is Malaysia’s first home-grown online streaming platform that offers exclusively Asian content, with shows from China, Japan, South Korea and Thailand.

Shareholders approved all resolutions at the meeting, which also recorded its appreciation towards the contribution of director Lew Weng Ho, who did not seek re-election.