Despite support from its property arm, Singapore Press Holdings Limited (SPH) is still struggling because of its weakening media business.

Nevertheless, SPH has been in most research houses’ watchlist and portfolio just because of the steady dividends it pays out. But that’s going to change very quickly.

Let’s take a look at what four local research houses have been saying about Singapore’s largest media company and some of the key data retail investors should know.

1. Core net profit

Although SPH’s FY17 core net profit of $239 million falls well within analysts’ expectations, it was still a good 14-15% dip year-on-year (yoy).

Notably, its FY17 headline profit $350 million was largely contributed by a divestment gain from a 33.3% stake in 701Search ($150 million) and a $57-million fair value change on Clementi Mall and Paragon.

2. Dividends cut

The total dividends paid out for FY17 amount to $0.15 per share, which is short of analysts’ expectations.

If anything, dividends are probably the most important factor for most retail investors nowadays. With SPH cutting its dividends, this might not bode well for its share price in short- and medium-term.

3. Media business hit

Core operating profits (-25% yoy), print revenue (-19%) and circulation revenue (-10% yoy) all decreased, contributing a total of -15% yoy (~$30.5 million) for media revenue and netting $173 million. Core operating profits for 4Q17 was $78 million.

4. Restructuring and staff cut

Amidst a challenging environment, the natural thing for a large company like SPH is to cut manpower costs.

The local newspaper company intends to cut staff headcount by 10% in the coming year, which should slightly raise earnings (at least ~4-5%) in the medium-term.

The new SPH CEO also intends to keep the established newspaper titles while exploring other areas of new media and expanding its international reach through a more diversified product portfolio.

5. Property investments

SPH’s property arm reported a gain of $57.4 million in 4Q17, particularly contributed by Paragon, The Clementi Mall and Seletar Mall.

Seletar Mall saw weaker rental conversions in the latest quarter and declined by about 1.0%, not a huge hit but a disappointment nonetheless.

Research house calls

Singapore Press Holdings Limited (SGX: T39)