NMG resumes dividend payment as full-year net income bounces back
Nation Media Group Board Chairman Wilfred Kiboro makes his presentation during the release of the company’s 2021 financial results at the Serena Hotel in Nairobi on April 20, 2022.
What you need to know:
- Board chairman Kiboro said company will pay shareholders Sh285.4 million, or Sh1.50 a share.
- NMG's Net income grew by 331 per cent to Sh584.7 million in the year ended December 2021.
Nation Media Group (NMG) has resumed dividend payment following a 331 per cent increase in net income to Sh584.7 million in the year ended December 2021 on recovery of business post the Covid-19 pandemic.
NMG Group Board Chairman Wilfred Kiboro said the company will pay shareholders Sh285.4 million, or Sh1.50 a share, as the region’s leading news organisation grew net income from Sh135.5 million posted in 2020 on a rebound in broadcasting and print advertising revenues. Turnover rose by 11.7 per cent to Sh7.6 billion from Sh6.8 billion in 2020.
Growth was supported by a rebound in print, television and digital advertising as well as a rise in revenue from e-paper and Nation.Africa subscriptions.
The company, which paid Sh1.50 a share in 2019, did not pay dividends in 2020 as it sought to conserve cash to weather the adverse effects of the pandemic.
Dr Kiboro said NMG plans to increase the payout progressively as profit grows on digital transformation and new business opportunities.
“Even as we go through transformation, we must not forget our investors. I am happy to announce that we will go back to paying dividends starting this year at Sh1.50 for every share,” he said.
Nation Media Group Chief Executive Officer Stephen Gitagama delivers his presentation during the announcement of the company’s financial performance.
“If we get good results, we hope to get back to the days we used to pay up to Sh10 a share,” he added.
The media company is banking on its large online presence and a revamped digital plan to grow sales.
NMG is working to leverage the huge online presence to monetise online audiences into sustainable revenue streams. The company has a reach of 47.3 million users across its website and social media platforms.
Its digital transformation journey accelerated during the pandemic to cushion huge drops in physical paper sales that saw digital revenues rise to six per cent of total turnover.
Broadcast revenues grew from 20 to 22 per cent of total turnover, reducing the company’s reliance on print revenues, which declined from 75 per cent to 72 per cent of total turnover.
Digital revenues mainly consist of digital advertising sales, subscriptions to e-paper and Nation.Africa, which grew to 14 per cent of total circulation sales up from 11 per cent in 2020 and four per cent the previous year.
The company’s niche publications such as the Business Daily and The EastAfrican have continued to record higher uptake of e-paper at 38 per cent and 21 per cent respectively and there is increased focus to review content and accelerate their position in the market.
Pakistan High Commissioner to Kenya Saqlain Syedah (centre) and NMG stakeholders and partners follow the proceedings during the release of the company’s results.
The company is also exploring increased use of data for Business Daily and exploring models of trading the data.
“Going forward, the bulk of the revenues will come through digital. The legacy media like print will remain for a few years, but distribution will be mainly digital. We hope to reduce reliance on print in the coming years,” Dr Kiboro said.
NMG said traditional products like legacy print media have shown resilience as business recovered, helped by the cost containment and business optimisation interventions rolled out during the pandemic.
Advertising revenue grew 14 per cent in print and 25 per cent on TV, while radio advertising was up 42 per cent.
Digital revenue grew 20 per cent, courier saw a 13 per cent growth, while e-paper subscription rose eight per cent.
The company’s stock price also improved from around Sh13 to the current Sh21 after a successful share buyback that attained 82.5 per cent of the targeted uptake.
