Vision Group posts first-half rebound in profit on stronger advertising revenue

Vision Group reported a rebound in revenue and profits in the first half of 2019/2020, underpinned by growth in advertising revenue and a reduction in the cost of sales.

The media company, which is controlled by the government of Uganda, posted financial half-year earnings of Shs20.9 per share on Shs46.6 billion in revenue.

Revenue rose 3.3% year on year for the six months to December 2019, up from a decline of 2.3% in the same period last year, according to financials released by the Uganda Securities Exchange.

“Total advertising revenue registered a growth of 11.3% while revenue from events, circulation, and commercial printing declined by 38.9%, 8.3%, and 1.5% respectively,” the company said in a statement.

Advertising revenue accounted for 65% of Vision Group’s revenue in 2018/2019, while circulation and commercial printing accounted for 23% and 11%, respectively. Print advertising was just over half of total advertising income at 52.6%, followed by television at 30.6%, radio at 13.4%, and digital at 3.4%. 

Print, radio and TV advertising increased by 13.8%, 9.1%, and 8%, respectively, while digital advertising declined by 15%.

Cost of sales fell 1.1% year on year to Shs34.5bn, faster than last years decline of 0.1%, on “increased efficiency in newsprint usage and other production efficiencies”, Vision Group said.

Gross income came in at Shs12bn, growing 18.2% after dipping 9.3% over the same period last year.

Distribution costs were up 5.5% while administrative expenses rose 7% to Shs7.8bn. The rise in administrative expenses was due to an “increase in office building repairs, rent, and legal expenses.” Other operating experiences increased by 2.9% to Shs1.3bn.

Vision Group’s profit before tax rose 50.4% to Shs2.7bn, compared with growth of 26% a year earlier.

Net profit increased by 45% to Shs1.5bn. A year earlier, net profit fell 15.9% to Shs1.1bn.

Related:Circulation falls for Uganda newspapers in fourth quarter of 2019