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Oliver Kazunga Senior Business Reporter

ZIMBABWE Newspapers (Zimpapers 1980), the country’s largest diversified media group said it will continue investing in digital technologies to reach a wider audience while adapting to the dynamics of the global media landscape where there is a significant shift towards virtual platforms.

Zimpapers is the market leader in publishing, broadcasting, digital, and commercial printing. Some of its top brands are The Herald, H-Metro, The Chronicle, Business Weekly, Star FM, and National Printing and Packaging.

In financial statements for the half year ended June 30, 2023, Zimpapers chairman Mr Tommy Sithole said the group remained alive to dynamics of the global media landscape, where there is a significant shift towards digital platforms and online streaming services.

“As a diversified media company, we are adapting to these changing trends and have invested in digital platforms to reach a wider audience,” said Mr Sithole. Zimpapers, he said has set up fully-fledged digital teams in newspaper, radio, and television units to propel digital growth.

“We have also worked to optimise our websites and applications for mobile devices to ensure a seamless user experience,” said Mr Sithole.

The local media environment, he noted had generally remained stable, with gains in digital and radio audiences making up for the stagnant growth in printed newspapers.

However, Zimpapers still enjoys “a fairly large” number of people preferring printed newspapers, thus giving good value to advertisers.

The younger audiences consistent with the current global trends, largely prefer using digital platforms.

Zimpapers would continue leveraging on its strong media industry brand recognition to retain and attract new audiences in the digital space, said Mr Sithole.

“The company’s broadcasting division has also positioned itself quite conveniently for the customers through investing in the latest and digitally sustainable software and hardware tools that make it easy to curate digital content for its digitally savvy customers.

“Consequently, the group’s online digital media audience increased by 17 percent from 7,6 million followers and website visitors to 8,4 million.

“Furthermore, the company also invested in the latest protection and performance firewalls to ensure that its systems would not be compromised, and customer data remains protected according to the ‘Data Protection Act’,” said Mr Sithole.

During the period under review, the group’s revenue increased by 59 percent to $40,7 billion from $25,6 billion in the same period year, driven by growth in all strategic business units.

However, due to the high cost of sales arising from raw material and labour increases driven by inflationary pressures, gross profit margin fell to 56 percent compared to 69 percent during the same period in 2022.

Overheads as a percentage of sales increased to 61 percent compared to 54 percent for last year 2022. 

The group recorded an operating loss of $1,3 billion compared to a profit of $4 billion during the previous comparable period.

Interest costs remained relatively high due to high cost of borrowing in local currency.

The newspaper division recorded 38 percent revenue growth to $23,6 billion compared to $17,1 billion in the same period last year.

Due to a high cost arising from inflationary pressures and low volume performance, a profit margin of 2 percent compared to 23 percent was recorded.

Operating profit of $439 million was recorded compared to $3,9 billion last year.

The commercial printing division recorded a 116 percent growth in revenue to $8,2 billion compared to $3,8 billion. Despite the significant revenue growth, raw materials, repairs and maintenance costs increased by a significant margin resulting in the business recording a modest profit margin of 2 percent compared to 10 percent last year.

The radio broadcasting division’s revenue improved by 85 percent to $8,9 billion compared to $4,8 billion in the prior year, weighed down by the losses from the start-up television broadcasting segment.

“We are confident that the ZTN channel will turn around the corner in the near future and start positively to contribute to the division’s profitability as the channel is gaining popularity and building a strong audience base,” he said.

Going forward, Mr Sithole said, Zimpapers would capitalise on opportunities arising from the measures put in place by the Government to stabilise the economy.

“Performance for the second half of the year is expected to be better than the first half as the second half is the peak period for the business.

“The company will continue to strengthen its product offering by improving the performance of its new and old products to give better profit margins,” he said.