Loss-making Bangkok Post to unload buildings to stay afloat

The publisher of Thailand's largest and oldest English newspaper, The Bangkok Post, plans to sell two big buildings in the Thai capital, the only major fixed assets the company owns, to raise cash so it can keep the print version of its daily up and running in the face of declining revenue brought on by the shift to online media.

According to advertising agency Media Intelligence, internet advertising spending in Thailand totaled 8 billion baht in 2015 ($265 million at current exchange rates). Three years later, the figure had more than doubled to 17 billion baht. It is forecast to reach 24 billion baht by 2020. This trend is mirrored by plummeting newspaper ad spending -- from 12 billion baht in 2015 to a forecast 500 million baht in 2020, a drop of 96%.

The 73-year-old Bangkok Post will sell its 30,000-sq.- meter printing plant and distribution center, and its 35,483-sq.-meter headquarters. The two assets are worth an estimated 1.68 billion baht in all.

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The sales are seen as a desperate effort to keep the print version of the Bangkok Post alive. The publisher transformed two Thai-language newspapers, Post Today and M2F, to online-only publications earlier this year, as it can no longer absorb the losses it has posted continuously since 2014.

But the Bangkok-listed company continues to struggle. It had a net loss of 341.5 million baht in the first nine months of 2019, more than double that of the same period of a year earlier, due to declining revenue and impairment loss on printing equipment. At the end of September, Bangkok Post's shareholder equity shrank to just 60 million baht, down from 1 billion baht at the end of 2015.

The Stock Exchange of Thailand gave a C rating to Bangkok Post's shares, indicating the company has severe financial problems. That rating is typically given to company whose shareholders' equity falls below 50% of paid-up capital.

Founded in 1946 with seven Thai shareholders by Alexander MacDonald, a World War II U.S. military intelligence officer, the Bangkok Post has been the most enduring and influential English-language newspaper in the kingdom, and came to be considered the world's window on Thailand.

"We decided to sell the [printing presses] and use an outsourced printing house for the Bangkok Post printed version," said Soonrath Boonyamanee, the newspaper's editor. "We don't have any plan to stop our printed version," he said, although he acknowledged that the online version is growing much faster.

The Nation, a 48-year-old English-language newspaper and the only local competitor to The Bangkok Post, stopped publishing its print version in June this year, as it could no longer bear the losses it had racked up.

Ref: Property Report