Tuesday, March 19, 2024
 
Columnist
Martin Hennecke
 
ORIENTAL PRESS
HKEx Stock Code : 00018 
 
Corporate Profile
The principal activities are newspapers and magazine publication, property investment and leasing and provision of corporate management services.

Business Review - For the year ended March 31, 2013

¡§Oriental Daily News¡¨ has continued to be the best-selling and most widely read newspaper in Hong Kong for the last 37 consecutive years, and is truly ¡§The Paper for Hong Kong¡¨. During the year, ¡§Oriental Daily News¡¨ continued to focus on in-depth coverage and quality, and has not only been successful in maintaining its leading position in breaking news, but has presented a number of high quality and well received exclusive reports. Every column of the newspaper is designed and written professionally to present rich contents. In pursuit of its mission to monitor the government, ¡§Oriental Daily News¡¨ stands up to the powerful and the authority, and pleads for the people and down trodden. Therefore, it is well received and has become a major avenue for the public to voice against unfairness in society. ¡§Oriental Daily News¡¨ has further improved its three-dimensional layout to present the print newspaper in a layered design. Owing to its outstanding reputation and strengths, ¡§Oriental Daily News¡¨ has been embracing the support of readers and advertisers for decades.

¡§The Sun¡¨ is holding fast as the third best-selling Chinese newspaper in Hong Kong for the last 14 consecutive years. In pursuit of constant improvement, ¡§The Sun¡¨ brings forth highlights in news to cater for the fast reading habit of young readers. During the year under review, ¡§The Sun¡¨ introduced a number of diversified and interesting new columns, while its supplement ¡§Sunlife¡¨ featured a new theme every day, appealing to young readers. At the beginning of the year, ¡§The Sun¡¨ adopted a new masthead design and a concise layout, taking on a fresh new look. With its dynamic image, ¡§The Sun¡¨ has attracted many advertisers targeting at young consumers, which in turn adds vigour to the newspaper.

¡§Good News¡¨, launched on an experimental basis in November 2012 to test market response, is now distributed with ¡§The Sun¡¨ each Friday and also given out separately in downtown areas free of charge. ¡§Good News¡¨ provides a variety of contents including sensational cover stories, truth-seeking news coverage and exclusive interviews of celebrities and artists, supplemented by fashion, recreation, beauty, food and international entertainment, featuring numerous selling points. Since its launch, ¡§Good News¡¨ has been well received and successful in attracting advertisements from magazines and free newspapers, contributing to the earnings of the Group. In light of the better-than-expected performance of ¡§Good News¡¨, the Group plans to increase its investment in this paperzine, and will conduct a comprehensive review on its form of distribution in the second stage, with a view to making ¡§Good News¡¨ an exclusive entertainment paperzine for young readers in Hong Kong.

¡§on.cc¡¨ is the flagship online portal of the Group. According to a summary analysis of Hong Kong 2012/2013 annual reports by comScore Media Metrix, an international market research company, ¡§on.cc¡¨ continues to record the largest number of visitors and become the news portal of the highest page views in Hong Kong, with up to 3.6 million monthly non-repetitive visitors and more than 2.5 million downloads of mobile applications. The news provided by ¡§on.cc¡¨ has been the search target of major search engines including Google, Baidu and Yahoo!. Amidst intense competition among search engines and browsers, ¡§on.cc¡¨ continues to improve its infrastructure and webpage monitoring programmes to maintain its leading position. As smart phones have been the focus of new media and changed the reading habit of netizens, ¡§on.cc¡¨ keeps up with the trend by updating its computer software and hardware constantly, enabling netizens and mobile users to have easy access to the Group's two newspapers, real-time news and TV news. During the year under review, ¡§on.cc¡¨ succeeded in developing iPhone applications that provide breaking news and push notifications of football scores, enabling its readers to keep track of the latest developments, and it was well demonstrated with the breaking news on the hot air balloon crash in Egypt in early March this year. In addition, this push notification service enables advertisers to disseminate product information to consumers faster and more effectively. In April this year, ¡§orientaldaily.on.cc¡¨ was granted the Gold Award of Web Accessibility Recognition Scheme by the Office of the Government Chief Information Officer in recognition of the initiative of our website to address the need of people with visual and hearing impairment for news and information. This shows that ¡§on.cc¡¨ has been recognised for its efforts to promote social inclusion.

¡§Money 18¡¨ is highly popular among investors for its Real-time Quote. Its 24-hour financial news enables investors to gain an insight into the impact of monetary and financial policies of different countries on economy and industries, helping them to deploy their investment strategies. In October last year, ¡§Money 18¡¨ launched a special edition on the Employee Choice Arrangement of MPF, providing readers with information on alternative investments through detailed analyses of the MPF market.

¡§ontv¡¨ has been renovating its interface and applications constantly to enable readers to watch news videos smoothly on computer browsers, mobile phones and tablet PCs. In addition to commercials and sponsored programmes, ¡§ontv¡¨ also delivers daily weather forecast cartoons to attract the new generation of netizens.

¡§FLASHon¡¨, the first free fashion weekly in Hong Kong, covers fashion, beauty and makeup, lifestyle, art and culture. Distributed with ¡§Oriental Daily News¡¨ in certain high-end residential and commercial areas each Thursday, ¡§FLASHon¡¨ brings a taste of fashion to Hong Kong newspapers, and is well received by fashion experts, professions and the middle class. In addition to the printed magazine, ¡§FLASHon¡¨ has also launched its websites ¡§flashon.com¡¨ and ¡§FLASHonTV¡¨, which present printed contents in the form of video to offer more fascinating and dynamic reading experience to the readers. During the year, ¡§FLASHon¡¨ has become the advertising media and a partner of a number of renowned international brands.

On our overseas investments, each of the Group's rental properties overseas has recorded satisfactory return, and has been generating steady rental income for the Group.

The overall performance of the Group for the year was below expectation as a result of the impact of external economic factors on advertising income. However, benefitting from the subscription of ¡§Oriental Daily News¡¨ and ¡§The Sun¡¨ in the Mainland, we were able to secure increased advertisements from jewellery, watch and brand garment advertisers during the year, and the revenue from websites also showed satisfactory growth. In light of the weakness in the consumer market, the Group has adopted a prudent business investment strategy. On the one hand, we have launched ¡§Good News¡¨ to take up advertising market share of entertainment magazines and free newspapers. On the other hand, we have made substantial efforts to develop website business to attract online advertisements and complement newspaper advertisements, which has increased the advertising income of the Group. Meanwhile, the Group also implemented a policy of reducing expenditure and streamlining its human resources. The cost of sales of the Group has decreased in the year under renew on the back of a gradual drop and stabilisation of printing costs. The Group's policy of exploring new income sources and reducing expenditure has shown positive impact on the whole.

Business Outlook - For the year ended March 31, 2013

¡§Oriental Daily News¡¨ and ¡§The Sun¡¨ have been enjoying large readership at all times. The Group will continue to invest resources in enhancing the contents of its newspapers, employing additional talents and improving its production facilities, to increase its advertising income. The Group has raised the retail price of its two newspapers to HK$7 in April this year, without compromising sales. It is expected that the increase in revenue from distribution in the coming year will contribute to the growth of its earnings.

Given the rapid development of technologies, ¡§on.cc¡¨ will continue to research and develop new technologies to meet the needs of readers and advertisers. Following the introduction of QR codes to the newspaper last year to enable readers to watch clips by scanning the codes using mobile phone Apps, ¡§on.cc¡¨ will soon launch an Augmented Reality Application, which will allow readers to extend reading by capturing pictures in the newspaper using their mobile phones, or watching commercials or downloading and installing advertising mobile Apps directly. Augmented Reality Apps, which break through the limits of printed advertisement and enable consumers to experience the virtual reality of products, are expected to set a new trend for product promotion by advertisers. In respect of contents, the Group will work with suitable partners to expand its global influence in response to the ever increasing demand of Chinese people worldwide for contents.

In an effort to develop website technologies and improve the functionality of our website, the Group has established a Technology Development Department and employed overseas professionals to research and develop new technologies. In doing so, the Group aims to create a new technical development platform of the website and mobile Apps, and explore business opportunities with partners from various sectors to increase the revenue of the Group. We believe that the website will become one of the major income sources of the Group in the future, and it can be separated from the traditional print media and form an independently operated electronic media.

In the year ahead, Hong Kong economy is expected to remain dampened by the European debt crisis which, coupled with China's statement of intention not to adopt further monetary easing policy, will have an impact on investor sentiment and consumers' willingness to spend. As a result, advertisers may further reduce their advertising budgets, which in turn may limit the growth of advertising income of the Group. However, the free newspaper market has been saturated, and paid newspapers remain the preferred choice of readers with high consumption power and quality customers. The Group's two newspapers will continue to maintain their leading market positions by providing extensive and elaborate contents. The Group is cautiously optimistic about its performance in the next financial year. The Group will continue to explore other suitable investment projects such as hotels and properties, with a view to diversifying its business to increase the value to its shareholders.

Source: Oriental Press Group (00018) Annual Results Announcement
Chairman Ching-fat MA Issued Capital (shares) 2,398M
Par Value HKD 0.25 Market Capitalisation (HKD) 2,134M
 
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