KUALA LUMPUR (Nov 2): Media Prima Bhd says it is embarking on the next phase of its business transformation exercise and that all affected employees will receive a fair and equitable compensation package.
The announcement confirms TheEdgeMarkets’ report earlier yesterday that the company was mulling over a staff rationalisation exercise.
In a statement, the group said: “This includes changing its business model and restructuring internally to enable the group to be future-proof and sustainable given the uncertain macroeconomic conditions and disruptive changes in the global and local media sector.”
Media Prima expects the restructuring exercise to be completed by the first quarter of 2020 and said that it will pay affected employees in full upon the fulfilment of all legal requirements. It will also provide support to staff which includes job outplacement services and career counselling.
“The global media landscape continues to change at a rapid pace and scale, requiring media companies to review and disrupt its own business model to remain sustainable and successful.
“Moving forward, the group — being the home to some of Malaysia’s highly followed and most valued media brands and content — will continue to focus on bringing value to its employees, customers, shareholders and stakeholders at large,” it said.
This marks the second round of staff rationalisation for Media Prima.
In November last year, Media Prima's subsidiary Sistem Televisyen Malaysia Bhd, which operates free-to-air television station TV3, gave 190 employees three months' notice of its intention to retrench them, while offering a mutual separation scheme (MSS) to 43 others.
The rationalisation of Media Prima's operations followed the entry of Aurora Mulia Sdn Bhd, a company linked to tycoon Tan Sri Syed Mokhtar Albukhary, which had acquired 88.29 million shares or 7.9% stake in the media group in September.
Aurora Mulia acquired an additional 7.5 million shares on Oct 8, bringing its stake in the company to 31.898%.
The investment vehicle had also acquired a 70% equity interest in Dilof Sdn Bhd, which holds the printing licences and archives of Utusan Malaysia and Kosmo!, following the shutdown of Utusan Melayu (M) Bhd's operations. Dilof has since been renamed to Media Mulia Sdn Bhd.
Media Prima posted a net loss of RM8.83 million for the second quarter ended June 30, 2019 (2QFY19), its second consecutive quarter in the red, amid lower contribution from the traditional revenue segment such as publishing and television networks.
The company has seen a string of quarterly losses since 3QFY16, with the exception of 4QFY16, 2QFY18 and 4QFY18.
Media Prima’s share price closed one sen or 2.74% lower at a five-month low of 35.5 sen, for a market capitalisation of RM393.77 million.
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