Total estimated February market adex fell 16.2% YoY to S$128m, the fastest YoY rate of decline in five years and the lowest total adex level since Feb 06. However, the newspaper sector performed better than in recent months with the S$55m February newspaper adex just 1% less than in 2008. However, this YoY comparison is slightly distorted by the fact that whereas the 2009 Lunar New Year was in January, in 2008 it was in February (so Feb 08 adex was significantly less than the preceding or succeeding months). Nevertheless, the long-term adex trend is clearly downwards reflecting recent economic trends. For example, cumulative estimated print adex over the last three months was approx S$205m, 13% less than the same 2008 period.
Nielsen estimates imply SPH's advertising revs trending as expected Based on this data, we estimate SPH booked approx S$150m advertising revenues during the Dec 08 to Feb 09 quarter, an approx 16% decline YoY. We therefore expect SPH to have achieved approx S$340m in 1H09 advertising revenues, 11% lower than in 1H08 and representing 49% DB09e. We maintain our forecast that SPH's FY09e advertising revenues will fall 12% YoY especially as these Nielsen estimates suggest that SPH's advertising performance is trending generally as projected.
Clearly advertising revenues are correlated with economic activity and a further deterioration in Singapore's economy could be punitive - an issue to watch closely. But at this stage, advertising appears to be trending in-line with our forecasts and we maintain our estimates and Hold rating.
Sponsored Links
No comments:
Post a Comment