Today, Yahoo Singapore publishes an article that SPH is expected to retrench about 10 percent of its staff. If the move is official, the retrenchment figure will be higher than the 111 staff it retrenched in 2003.
The sheer number of SPH staff expected to be laid off is frightening. This is because back in 2003, the business condition was difficult due to Iraq war and SARS outbreak. In today’s context, the market condition is not well either but we don’t have any global wars or major pandemic flu taking place.
Thus, even though the Ministry of Trade and Industry (MTI) announced two days ago that Singapore is not experiencing recession at the moment, my concern is that the state of our economy is even more dreadful than what many people might have thought.
Bad economy and headwinds aside, SPH’s poor performance can be attributed to its management’s failure to transform the media giant into a digital power-house. The bulk of its average daily circulation is still in printed copies and its online subscriptions form a small percentage of its daily circulation. This is a worrying trend as Singaporeans lifestyle has changed and apparently, SPH is unable to keep up with the change.
The reason why readers prefer to go online is because most of us want to be updated with the latest news. Who would want to read yesterday’s news? With printed newspaper, the content will always be one step behind online. In addition, digital newspapers allow advertisers to make use of data analytics to review their advertisement performances.
Inevitably, SPH must accelerates transformation of its business model. Otherwise it is only a matter of time that it goes the way of the dinosaurs in this new digital era.
SPH’s third quarter FY2016 is dismal. The company announced net profit of $52.7 million, a decline of 46.4% compared to the same period last year. Revenue from its core business – media dropped a whopping 7.4% due to the drastic decrease in advertisement revenue. Apparently, the results are bad enough to warrant management to pull the firing trigger.
If the retrenchment do materialize, Singaporeans can expect more companies to follow suit. This is especially so for the banking and finance sector, a key segment of Singapore’s economy. With so much fear in the job market, would you still invest your money or save it for a rainy day? What if the stock market crashed and then your company unexpectedly wanted to downsize? Under such circumstances, you would panic for sure.
The best approach in this time of uncertainty should be to hold more cash but bank interest rates remain very low. Thus, my wealth strategy is to rebuild my Emergency Fund consisting of cash sufficient to meet six months of my household expenses (I had depleted most of my funds for the purchase of a new Executive Condominium). I also aim to increase my gold holding for the next couple of years because I am still bullish on the long term prospect of gold.
The conventional wisdom is to wait for a stock market crash and then go in for the bargain kill. But when your job is not secured, would you still do so? Previously, during the 2008 financial crisis, I had done so and made some money. But back then, I was a bachelor with no family commitments. Now, a lot is at stake for me.
Gold has always proven to be a safe haven during market uncertainties. In fact, gold price had surged from USD650 in 2008 to the current price of USD1255 per ounce, almost double in value. So start to ring-fence your wealth and buy gold bars in Singapore now!
In Singapore, BullionStar’s Bullion Savings Programs allow you to trade gold and silver online at any point of time. At very low price premium and spread, BullionStar allows you to convert grams in the Bullion Savings Programs (BSPs) to 100g PAMP Cast Bars and 15kg Heraeus Bars. Unlike other bullion savings programs (BSPs) are fully backed by physical precious metals.
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SG Wealth Builder