The Standard Group PLC has recorded a Ksh200 million loss as the company struggles to stay afloat.
Standard Group’s Board of Directors made the announcement in a notice on August 30 which detailed the company’s un-audited results for the six-month period ending 30 June 2024.
The Group said that the Ksh200 million loss before tax was occasioned by the decrease in its total revenue by 16.8%.
According to the company, its total revenue decreased to close at Ksh1.049 billion from Ksh1.260 billion in the previous 6-month period.
“Total revenue for the Group decreased by 16.8% to close at Kshs.1.049 billion from Kshs 1.260 billion in the previous 6-month period. This saw total costs decrease by 11.4% compared to a similar period in 2023,” the notice reads in part.
“Consequently, the Group incurred a loss before tax of Kshs 200 million compared to a loss before tax of Kshs.147 million in the prior year.”
According to the Group, the decrease in costs was caused by reduced advertising spending as businesses cut back on expenditure to weather the current economic conditions.
Standard Group cites constrained business environment
Further, the listed firm cited constraints in the business environment against a backdrop of external factors such as growing global uncertainties, floods, and sustained geopolitical tensions.
Other factors such as tightening monetary policies in advanced and local economies and depressed consumer spending in advertising were also cited by the company.
In response to the recorded loss, the Group highlighted that it has undertaken cost rationalization measures on operating expenditure, key amongst them being staff costs.
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The financially struggling company in July announced plans to fire more than 300 employees among its latest efforts to remain afloat.
On Tuesday, July 30, the Standard Group Board issued a notice of intention to declare redundancy as stipulated in section 40 (1) of the Employment Act, 2007.
The Board explained that it reached the decision considering the harsh economic environment and the changing trends in the media industry and among the audience due to the advancement in technology.
Following the announcement, the Mombasa Road-based media station shut down several TV stations, taking them off air and abruptly ending multiple popular programs early August.
The media giant shut down KTN News, KTN Farmers TV, among other brands and merged with KTN Home, which aired entertainment and lifestyle content.
According to the media house, the move was part of the measures the embattled media house is taking to stay afloat amid financial struggles.
New CEO and the Group’s Outlook
The Standard Group’s announcement of the Ksh200 million loss for the six-month period ending 30 June 2024 comes after its Board of Directors named Marion Gathoga-Mwangi the company’s new Chief Executive Officer (CEO), which took effect from July 15, 2024.
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Mwangi took over the reins of Standard Group from her predecessor Joe Munene who has held the position on interim basis since July 6, 2023.
The new CEO who is an accomplished Senior Executive with over 26 years of local and international experience in Commercial, Operations Excellence and General Management in multiple sectors is tasked with pulling out the Group from its current crisis.
The Group has maintained that it is confident that the current market conditions will continue to improve as the Government undertakes policy changes aimed at strengthening the economy.
“The Group is undertaking a transformation process to competitively position itself to meet the changing needs of its clients through innovation across our wide range of media products,” Company Secretary Victoria Cherotich said.
“Further, the Group has cushioned itself through continued cost rationalization in a bid to operate much more efficiently.
Overall, despite the prevailing economic headwinds, the Group remains cautiously optimistic and will continue to grow revenues to return to profitability.”
Meanwhile, Standard Group’s Board of Directors while addressing Dividend said that it does not recommend payment of an interim dividend considering the Groups performance.
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