SPH

SPH: 2Q12 results missed expectations as the Grp posted a 15% yoy fall in net profit to $71.5m for 2Q12, as operating revenue dipped 5.5% to $282.2m. The grp declared an interim dividend of 7c to be paid on May23. Fall in operating rev came as the newspaper and magazine business registered a 7.1% slide in rev to $224.4m, due to a 7.6% fall in advertisement, especially in the property and transport sectors. Circulation revenue also shrank 4.9% to $47.3m. One bright spot came from the co's property business which saw rental income rising 4.5% to $50.2m on higher rental rates at the Paragon mall. Income from The Clementi Mall also remained stable. Going forward, grp note that the economic outlook remains modest and challenges are expected as the economic restructuring process gets underway. Grp aims to explore opportunities in new growth areas and other adjacent businesses, while striving for a sustained performance in the core newspaper business. Representatives for the company declined to comment on plans for a potential REIT spin-off. Ratings as follow: CS neutral at $4.50 Deutsche maintains Hold with $4.17 TP UOB Kay Hian maintains Hold with $4.50 TP Maybank-KE maintains Buy with $4.95 TP. OCBC maintains Buy with $4.94 TP