Nation Media Group (NMG) has halved its dividend after a sharp fall in its full-year 2018 income.
The listed media firm further warned investors that its strategy to monetize its digital footprint would take time. Net income for the period fell by 21.8 per cent to Sh 1.035 Billion while pretax profit fell by 16.4 per cent.
The media house attributed the decline to a difficult operating environment particularly in its main markets; Kenya, Uganda, and Tanzania. Its chairman, Wilfred Kiboro also noted that the print business, which contributes over 90% of the total income, continues to face digital disruption.
The firm’s management also announced plans to introduce a paywall for some of its online content as
Sustained decline in Top-line growth
Additionally, the firm said its decision to stop government advertisements, which contribute approximately 33 per cent of the advertising revenue, negatively affected its revenues. In July 2018, NMG said it resolved to stop government advertising due to delayed payments. The management said has since resumed business with the Government and at the same time working towards reducing its reliance on government advertising.
NMG’s cash flow from operations declined to KSh2 billion from KSh3 billion. The group’s finance director said that approximately KSh1.2 billion of the company’s cash is jointly held by the national government and some county governments.
Given the steady decline in revenue, Nation Media Group cut its 2018 dividend by half to a total dividend payout of KSh5.00 per share from the KSh10.00 dividend it had been paying since 2012.