Shares of Nation Media Group (NSE; NMG) have advanced by around 35% over the last two months ahead of the publication of the full year results due on Wednesday 5th April 2017.
The counter was on Thursday’s trading session trading at Sh 99.50 compared to Sh 73.5 spotted on 2nd Feb 2017. On Tuesday, the counter also hit a new five month high of Sh 101 per share.
The price change since Feb would rank it as the the third-biggest gainer behind Sasini and KCB Group which have gained by 44% and 39% respectively. Over this period, NMG has traded approximately one million shares at the NSE.
Full Year Expectations
In 2015, Nation Media After tax profits fell by 9.7% to KSh 2.222 billion citing revenue shortfall in its broadcasting division which was affected by the digital migration.
In the half year period of 2016, the company reported a 15% drop in after tax profits to Ksh 785.4 million impacted largely as a result of a 7.8% drop in group turnover to KSh 5.6 billion.
In the Full Year results, we expect things to be very tough given the performance of the two periods highlighted above.
The company’s newspaper advertising revenues which account for more than 70% of its total revenues have been falling as a result of the changing consumption of the news business model. However, the management is optimistic that the recent investment in the digital media space and a new printing press will have an impact on the bottom line.
Survey shows that newspaper advertising revenues are falling nearly everywhere because advertisers nowadays have a wide variety of different advertising media channels available to them at a cheaper cost.
Meanwhile, the World’s largest Sovereign Wealth Fund, Norges Bank Investment Management has released new information about its holdings in Kenya. In 2016 the fund reduced their holdings in ARM Cement, East African Breweries (EABL), Equity Group, Nation Media Group (NMG) and Safaricom. They sold out their entire 2.86% stake in WPP Scan group. Read More Here; Did your Portfolio outperform the Largest Sovereign Wealth Fund in the World?
Related; NMG acquires Majority Stake in Kenya Buzz for undisclosed amount
