Friday, August 1, 2008

Bangkok Post Reports on The Nation's Failures

The Nation alters structure to cut costs

Two new companies run paper's operations


Nation Multimedia's The Nation newspaper, which was relaunched earlier this year as a business daily, is set for further changes to cope with rising costs. According to Pana Janviroj, president of The Nation, starting today the English daily is no longer operated by Nation Multimedia Group (NMG). Instead, it operates separately under NMG Co Ltd, a subsidiary of the parent company. Also, a separate sub-editing company partly owned by former sub-editors of The Nation will be set up with the backing of NMG.

Last week, the parent company offered a voluntary early retirement package for editorial staff. About 30 Thai and foreign workers out of 130 took the package.

The four-month-old free tabloid Daily Xpress has also been downsized from an initial 48 pages to between 24 and 28 pages currently. It stopped printing on weekends since the beginning of last month.

The changes are aimed at cutting costs, said Mr Pana. The company is suffering from declining ad spending and skyrocketing newsprint prices, now averaging US$870 a tonne, up from $540 at the end of last year.

The group owns a range of media in print, radio, satellite TV and the internet. But not every product, including The Nation, is successful.

''Hopefully, after the change, we can reduce our massive debt,'' said Mr Pana.

NMG reported total debt of three billion baht in the first quarter of this year, with a turnover of 790 million baht, net profit of 6.94 million baht and assets of four billion baht.

As for 2007, its total debt was 3.22 billion baht, with a turnover of 3.2 billion baht, net losses of 797 million baht and assets of 4.1 billion baht.

Actually, I read on their financial statement that they have more debt than they have in assets.

Correction(Courtesy of the Corporal): Nation Multimedia Group Public Co. Ltd. may have more financial risk than other companies in the Media industry as it is one of the most highly leveraged with a Debt to Total Capital ratio of 73.08%. This ratio actually increased over the last year. Additionally, an examination of near-term assets and liabilities shows that there are not enough liquid assets to satisfy current obligations.

Mr Pana said it was looking for strategic partners for NMG Co. In the beginning, management will hold 10% of the new firm and the rest will be held by its listed parent.

Strategic partners? They have run the business into the ground. If I were a corporate raider, I would have bought it before they sold off their assets, but now, there is nothing left but mountains of debt and the same shitty management and board of directors.

NMG will later dilute its holdings in NMG Co to below 50%.

The new sub-editing firm will not only provide service for the group, but also for outside clients.

The subs were smart to walk away and start their own company. Now they can no longer be exploited by the Thai management. However, they were not that skilled to begin with.

Mr Pana insisted that the changes were not meant to change the focus of The Nation from a business newspaper. Once political news does not dominate all media, its image would be clearer, he said. The newspaper now has more business columnists and analysis.

Crap columnists, irrelevant business news and analysis. If Thanong ranting and raving about the 1997 Crisis and the evil foreigners over and over again is analysis, then Pana needs to have his head examined. And who would want to listen to The Nation, a failing business, pontificate about business? It has no credibility in that area.

''At the end of the day, The Nation will be similar to the FT (Financial Times) or the Wall Street Journal, having primarily business news,'' he said.

I am sure most of the English speaking population of Thailand spat coffee all over themselves after reading that sentence. The Nation is not even worthy of being the recycled toilet paper at FT and the Wall Street Journal.

A media watcher said Xpress was premature for the Thai market.

''The group's free English tabloid has come out five or ten years ahead of its time. The English language market is still very small here,'' he said.

Actually, the entire newspaper market is small. A crappy English language tabloid is nothing but an insignificant blip in the overall market.

A staff member at the newspaper questioned management's efficiency.

''Was it the right time to launch a free tabloid amid rising newsprint prices and a sluggish economy?'' the staffer said.

How come nobody listened to this guy when Daily Xpress was launched?

NMG share prices closed yesterday on the Stock Exchange of Thailand at seven baht, down 85 satang, in trade worth 112,000 baht.

I'm surprised that the price remains so high. It doesn't have the cash to pay off its debts. It has lousy management. It makes only superficial changes so Suthichai Yoon can save face.


Anonymous said...

Fonzi apparently you could not add nor deduct properly. I looked into the same NMG financial statements you referred to, and, the arithmetic for NMG's 2007 balance sheet comes out:

Total Assets - Baht 4,148 million
Total Liabilities - Baht 3,338 million

Thus Assets less Liablities gives us NMG Equity of Baht 810 million.

I am no accountant Fonzi but I can still add, and deduct, better than you!

But I agree w/ you Fonzi that NMG's Balance Sheet situation is dire, desperate for sure. NMG's equity had consistently been shrinking annually, from Baht 2,158 million in Y2004 to Baht 810 million by close of Y2007 - that's a whopping LOSS to the shareholders of Baht 1.4 billion over a 3-year period! Jeez . . . NMG's finances must be a nightmare!

I can only guess that Y-2008 for NMG must have been financially horrendous - - probaly zero equity, or as Fonzi suspects, capital deficiency.

So if readers can begin to detect some tremor of despair (panic even ha ha ha!) from Nation's daily editorials . . . we can pin it on dire finances! Those Nation editors and reporters wages may already have been many months overdue . . .????

Unknown said...

Blame the SEC. If ever a company needed to be looked into very carefully, at least two directors ("T" and "T") would be s*itting themselves. As for Suthichai -- he gave up a long time ago.

Oh, and leave the bloody sub editors alone, for f*ck's sake. They're totally under the thumb of the Thai staff and don't have the final say on anything -- and anyway, who the hell would want to work for 50k a month with stuff-all benefits? It takes many years to reach the stage where you can be called a competent sub editor on a newspaper at home, so who wants to come here and deal with crap English and badly trained writers and be treated like you're unwanted. Thailand features on virtually no-one's radar in Asia -- Japan Times, SCMP, Strait Times, yes, but this place is ground zero. So I give credit to those souls battling it out there.