SPH reported that FY17 PATMI increased 32.0% YoY to S$350.1m mostly due to a gain of S$149.7m from a partial divestment of the group’s stake in the regional online classifieds business, and a fair value gain on investment properties of S$57.4m, which were partially offset by impairment charges of S$96m on the group’s magazine business and printing presses.

Excluding these one-time charges, however, FY17 recurring earnings declined 20.2% YoY and FY17 operating revenues also declined 8.2% lower as the core media business continued to suffer the disruption from digital media.

The property segment, however, delivered steady results as revenues increased 1.2% YoY from higher rental income from the group’s retail assets.

We deem this set of results to be mostly within our expectations. We put our rating and fair value estimate of S$3.25 under review.

Source: OCBC Research - 12 Oct 2017