The fate of my investment in SPH.

"At SPH, we recognise the power of sharing in a world that's more connected than ever, across multiple platforms."

Disruption to the media industry is faster and more frightening than I had expected. Actually, if an IT dinosaur like me can be a blogger, I shouldn't be alarmed by this but I am.




That the disruption has impacted SPH is amply evident with its earnings declining in the last few years. DPS declined by 33% or so in the last 5 years and we will probably see DPS dropping by another cent or two this year.

If the decline is seasonal, there is no reason to fear because some months will do better. If the decline is cyclical, we can always wait for the cycle to turn up if we are patient enough. 

However, if the decline is structural, whether a business can do well again would depend on whether it is able to re-invent itself to stay relevant in the face of a new reality.




The move to diversify its business to reduce reliance on the media industry made sense but although SPH has investments in real estate which provides recurring income, the bulk of its fortunes is still tied to the media industry.

Witnessing its decline is very sobering for me. The world is changing and changing fast. What has not changed is my attachment to SPH. I belong to the old economy and I guess SPH still does.

I have been a shareholder of SPH since before the Global Financial Crisis and taking into consideration the years of dividends received as well as the low prices I paid during the Global Financial Crisis, I doubt I have lost money being invested in SPH. 

Even taking into consideration the highest price I paid when SPH REIT was listed in the middle of 2013, with the dividends paid out since, I doubt I have lost money.




Will I add to my investment in SPH now? 

I am happy enough to hold on to my investment but to add to my investment in SPH, there must be a sign that earnings will improve or at least stop declining.

I can see that SPH is changing but is it in the right direction and is it fast enough?

Of course, if Mr. Market should offer me a price that I cannot refuse, even with SPH's declining earnings, I might buy more, but, for now, I am keeping the status quo.




See update here:
Sizing my investment in SPH.