Nation Media Group’s shares have suffered a sharp decline in value for the past three years. In that period, the firm has lost more than Ksh22 billion of its market value. As at close of business 23 Jan 2018, the company’s stock traded at Ksh58, a 12 per cent drop in value since the start of the year.
The company is the largest media firm in the East African region in terms of audience reach. It is involved in print, broadcast and digital media among other operations. Nation Media Group is based in Kenya with subsidiaries in Uganda, Rwanda, and Tanzania.
As per the company’s 2017 annual report, NMG’s main source of revenue was print business. Income from the print operations accounted for 83.9 per cent of the firm’s revenue. In that period, the income from Newspaper and Magazines dropped by 7.6 Per cent to reach Ksh8.914 billion from Ksh9.645 billion earned in 2016.
The drop was attributed to a decline in print circulations of its main newspapers; Daily Nation, Business Daily, The East African, Citizen, and Mwananchi. In January 2019, the company announced key editorial changes within its newspaper businesses in Kenya. The changes are meant to drive up sales and grow the market for the company’s print business.
During its investor briefing in April 2018, NMG announced its new focus to grow its digital segment. The company’s Chairman Wilfred Kiboro said that the media organisation aimed to become a modern digital company.
An interesting observation is NMG’s lack of youthful representation on its board; given its new interest in digital media. As per the 2017 annual report, its youngest board member is 50 years old. Also notable is that two of its 16 board members have worthwhile experience in digital media.
The media company’s performance has been dragged down by huge sums owed by the government. According to a Daily Nation article published on 8 December 2018, the company was yet to receive its dues owed by the Kenyan government (estimated to run over Ksh856 million.)
In an effort to cut its costs and improve its financial performance, the media company embarked on a series of staff lay-offs. An article by Kenyan Wallstreet indicated that the company’s staff count dropped by more than 250 employees in the period between 2016 and 2018.
Despite its financial woes, NMG has maintained its annual dividend payout policy of Ksh10 dividend per share for the past six years. The media company is expected to release its 2018 full year results in April 2019.
