The Vision Group, publisher of the New Vision newspaper, and owner of other affiliated media houses, has announced a loss for the financial year ending December, 2024.
A Board of Directors’ statement signed off by the Group’s CEO Mr. Don Wanyama, noted that the company will be in a financial loss based on the preliminary assessment of its earnings for the half year ended December 31, 2024.
The company attributed the loss to the challenging business due to declining traditional media newspaper sales and advertising revenue spend across the different platforms coupled with the increase in prices of raw material inputs and other operational costs.
New Vision first issued a profit warning statement in July 2024, in which it indicated a loss for half-year results for the financial year ending June 30, 2024. The loss was attributed to similar reasons explained above.
The Group reported a half-year loss of UGX 11.2 billion for the financial year ending June 30, 2024, which represents a 103% increase from the UGX 5.5 billion loss reported in the previous financial year, painting a grim picture of the company’s financial health.
The company’s revenue dropped by 8.3%, falling from UGX 87.6 billion in 2023 to UGX 80.3 billion in 2024. The primary contributor to the decline was the continued slump in print and publishing revenues, coupled with a broader shift in advertising trends that favor digital platforms over traditional media.
Gross profit plummeted from UGX 17.0 billion to UGX 7.6 billion, a 55% decline.Operating loss widened to UGX 12.4 billion, from UGX 5.7 billion a year ago.
Despite efforts to curb costs, key operational expenses still weighed heavily on Vision Group’s balance sheet with raw material costs, particularly newsprint and commercial printing paper, remaining high.
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The Company’s segmented revenue according to product lines shows it derived 39 percent (UGX. 31.3 billion) of its revenue from print media, 30 percent (UGX 24 billion) of its revenue from electronic media, 25 percent (UGX 20 billion) from commercial printing, and the rest of the UGX 5 billion from publishing, outdoor advertising and other sources.
Cost of sales increased to UGX 72 billion compared to UGX 70 billion in the previous year resulting from an increase in cost of raw material inputs especially newsprint and commercial paper.
The high costs resulted in print media registering a loss of UGX 7.3 billion, the electronic media had a loss of UGX 5.3 billion loss, while publishing registered a UGX 6.1 billion loss. Commercial printing was the only profitable unit, contributing UGX 4.4 billion.
In response to its financial woes, the company is shifting focus toward outdoor advertising and commodities trading, which management believes could offset revenue shortfalls in print and broadcast.
However, with declining revenues and increasing costs, Vision Group faces an uphill battle to remain competitive in a rapidly evolving media landscape.