New Vision Printing and Publishing Company issued a profit warning Wednesday, saying it would post a loss for the half year to the end of December.
Once again, the state-controlled media group attributed the decline in business to lower newspaper sales, a drop in advertising revenue, and increased input costs caused by global supply chain disruptions — all of which it blamed on the Covid-19 pandemic.
In a statement by Don Wanyama, the managing director, New Vision repeats word for word its previous profit warning in September last year. Taking New Vision at its word, the pandemic seems to have worsened the disruptions media companies were already facing, cutting them out of the recovery that most other sectors have enjoyed over the past year.
New Vision’s loss for the year to June 2023 was its second since listing in 2004. That loss was primarily due to a significant drop in publishing revenues. The company invested feverishly in the new vertical, touting it as a lifeline in the face of falling advertising and circulation sales.
Newspaper sales and advertising revenues — the main culprits in the group’s September profit warning — fell in the year to June 2023, but not as much as publishing. In fact, that statement made no mention of publishing revenues, which turned out to be the biggest cause of New Vision’s losses.
The results will probably show that New Vision’s hopes of building a publishing chiefdom based on demand from educational institutions were too optimistic. Or they may show that advertising revenues have still not recovered from the coronavirus, another reminder of the fragile state of the media industry.
Either way, they will not come as much of a surprise.
