ENTERTAINMENT
RS foresees return to profits in 2009
- By: BAMRUNG AMNATCHAROENRIT
- Published: 14/01/2009 at 12:00 AM
- Newspaper section: Business
RS Plc, the country's second-largest entertainment company, expects to return to profit this year after completing its downsizing programme last year with the closure of poorly performing operations.
FROMLEFT Surachai Chetchotisak,CEOof RS, Pornpan Techarungchaikul, chief operating officer andDarmNana,chief financial officer, discuss the company’s business direction in 2009.
Among the key operations shut down last year was I-Dream Co Ltd, which brought in foreign concerts and shows. RS said this year is not the right time for international gigs because the slowdown is hitting consumers' pockets.
A TV production team, which produced programmes for various channels, has also been closed to lighten the company's financial burdens.
In addition, RS has cut its stake in its publishing arm, Idea Power Co, from 100% to 25%. Idea Power publishes Dara Daily entertainment newspaper and weekly.
As a result, RS expects its gross margin to be 26-27% in 2009 and its revenues to grow by 10% to 2.6 billion baht.
During the first nine months of 2008, RS posted a net loss of 355 million baht on total revenues of 1.67 billion baht. Its income was severely hit by failing to benefit from live broadcasts of the 2008 Euro Football tournament.
Surachai Chetchotisak, RS president and CEO, said the expected improvement this year would reflect the cost-cutting programme. The company would be even slimmer and would also have a firm focus on the business it specialises in.
"Despite economic uncertainties, we will go ahead with our business plan but will do it more considerably. Our business plan will be more flexible by revising output every quarter. I am confident of achieving the sales projection of 10%," he said.
He added that the key sales contributors would be three businesses: providing digital content mainly via mobile phones; TV production on free-to-air channels; and in-store TV production in chains such as Big C, Tops Supermarket and Carrefour. He said all three businesses show significant growth - especially in-store media, which grew by 90% last year.
In the movie business, RS will produce four titles this year.
"This year, consumers are still worried about the current weak economic situation, which has shrunk consumer spending. But I believe it will be only short term," said Mr Surachai.
He also urged the Democrat-led government to rebuild consumer confidence through economic stimulus packages.
RS shares closed on the Stock Exchange of Thailand yesterday at 1.22 baht, up four satang, in trade worth 11.6 million baht.
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