Standard Group outlines recovery plan after Sh1.5b rights issue nod

From left: Standard Group PLC Finance Controller Kiplagat Kiprotich, Group CEO Marion Gathoga-Mwangi, Board Chairman Julius Kipngetich, Company Secretary Millicent Ngetich, Grant Thornton LLP External Auditor Alfred Siele and Standard Group Chief Executive Editor Chaacha Mwita during the Standard Group 107th Annual General Meeting 2025, in Nairobi, on June 30, 2025. Nairobi. [Kanyiri Wahito, Standard] The Standard Group Plc is banking on the upcoming rights issue, cost intervention measures and new revenue streams to power its recovery plan. Also in the media house's recovery plan is increased debt collection, to recover nearly a billion shillings owed by government institutions and the private sector, and prudent use of resources. The company, which is investing in accelerated digital transformation, has received an extension from the Capital Markets Authority (CMA) to keep the upcoming rights issue open for 60 days to facilitate the raising of the expected Sh1.5 billion. The Group's Chief Financial Officer (CFO), Kiplagat Kiprotich, conveyed the news during the company's 107th Annual General Meeting, held virtually yesterday, and chaired by outgoing board chairman Dr Julius Kipngetich. Mr Kiprotich said the rights issue was one of the key interventions the company is putting in place to repair its balance sheet amid the losses recorded in the financial statements. Balance sheet According to the 2024 financial statements as adopted by shareholders, the company reported a loss of Sh1.1 billion compared to Sh722 million in 2023. Revenue stood at Sh1.8 billion, down from Sh2.3 billion in 2023. "The biggest contributor to this is revenue decline despite having our costs reduced," he said. "The balance sheet does not look good, but the interventions put in place - and the rights issue - are expected to shed off some of these liabilities." He said the 2025-2027 strategy approved by the board will also go hand in hand with the recovery plan. Mr Kiplagat said that following CMA's approval on May 14, 2025 for the company to proceed with its rights issue, the tentative date for opening of trading has been set for July 12, 2025. "CMA also granted us approval for the rights issue to be opened longer so that the shareholders can take advantage. It has been granted an exception to open for 60 days," he said. According to CMA, issuers are expected to fix the closing date for the receipt of applications for and acceptance of new shares not later than 30 days after the books' closing date. "We believe this rights issue offers an attractive way for you to increase your stake in the company and be an integral part of an exciting journey forward," added the CFO. The Group's Chief Executive Officer Marion-Gathoga Mwangi noted that despite many positives recorded in the economy in 2024, such as the strengthening of the shilling against the US dollar and reduced inflation, the country's Sh11 trillion debt was still straining the businesses in the country. "Public debt is a big issue in our business. There is about Sh10.6 trillion owed in public debt in the country, and we have not been an exception," she said. She noted that the company was affected by depressed ad spend by big advertisers and the government, as well as digital and supply chain disruptions. Ms Mwangi said the period had shown that digital disruption is going to continue, and the company has started to employ mitigation strategies. "Our countermeasures include cost rationalisation and transformation initiatives that have brought us into a better method of improving the way that we run our business," she said. Standard Group is the country's oldest media company, having been in existence for over 120 years. It is home to The Standard (Kenya's oldest newspaper), The Nairobian, Standard Digital, Standard Courier Services, Spice FM, Radio Maisha, Berur FM and KTN. Standard Group's Chief Executive Editor Chaacha Mwita highlighted the progress of the company's efforts to wiggle out of the financial challenges, such as reducing administrative costs. He said the company is now poised for the next take-off, informed by how well it navigates the digital revolution. "We have seen that advertising on legacy media is reducing, and of course, the consumption patterns and audiences are changing. We are moving to where audiences are, which is digital," he said. He said the company was working on a video-on-demand (VOD) platform with partners from South Africa. "We are revamping our content online so that we have premium content, and of course, premium content is premium advertising," he said. Mr Mwita said the Group has also put in place aggressive revenue collection strategies, adding that the company was owed a lot by advertisers, including government entities. "It is not just a question of new business; it is also a question of handling revenue that we are owed by other entities. We are in a strategic planning mode to see how we can bring in this revenue so that, together with the rights issue, we can have enough liquidity," he said.

Standard Group outlines recovery plan after Sh1.5b rights issue nod

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Standard Group outlines recovery plan after Sh1.5b rights issue nod

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