RJRGLEANER to grow through diversification
RJRGLEANER Communications Group CEO Gary Allen aims to double returns in five years and has laid out a growth strategy underpinned by business diversification, new partnerships and potential acquisitions to achieve that goal.
The media group, whose holdings span print, radio, television and online services, to achieve returns on equity of 15 per cent in the medium term.
"That's going to take a significant move. In fact it is more than double what our return on equity is today but we intend to pursue that through a number of different strategies," Allen told shareholders at the Radio Jamaica Limited annual general meeting on Monday. Radio Jamaica trades as RJRGLEANER Communications Group.
In the face of an increasingly competitive Jamaican media market, the company will be reaching outside Jamaica to the Caribbean and beyond for 40 per cent of revenues. Allen also told shareholders the media company is on the lookout for business opportunities and partnerships in the areas of content creation and cable operations, while teasing the possibility of an announcement in this regard within three months.
"We've started some of these things in that we are in negotiations with a number of other players and we expect to make a number of announcements by the end of this calendar year," he told the AGM.
He noted that as the group diversifies a strategy aimed at expanding non-core business activities it could result in further investments and acquisitions.
"Our business objectives include expanding the group by investing in some other areas. So you will see us invest in or acquire some other businesses, working with ours these should provide synergy for growth," Allen said.
At year ending March 2017, Radio Jamaica made a profit of $145 million, a turnaround from a loss of $225 million in FY2016. Allen noted that all business segments were profitable for the group one year into the merger of Radio Jamaica and The Gleaner Company (Media) Limited.
His focus this year is to have the brands operating more in synergy instead of competing in the same space for business.
"We've seen some of that started in the group. Some of the radio stations have been streamlined and some of the music content changed," said the CEO.
"At lot of what we are seeing there now has not been what it was for that last few years, that is, driving to a more structured, defined,
niche-oriented set of radio stations not one cannibalising the other," he said. "That is going to give us greater focus and the ability to sell those niches."
Meanwhile, Chief Operating Officer Christopher Barnes reported progress on the digital switch over, or DSO, project. RJRGLEANER has set aside approximately US$3 million for the current phase of the project
"Phase two of this digital switch over is virtually complete in that Television Jamaica and the three cable brands, JNN, RETV and TVJSN should, by the end of this month, have capability to output a high definition signal," said Barnes, who is also managing director of The Gleaner Company (Media) Limited.
"What that means is that anybody who has the capability to access and view a high definition signal will be able to do so with these channels," he said. He however cautioned that free to air access of HD signals is not yet available.
The final phase in the conversion should be finalised by FY2021, assuming the Government and regulators settle on the technological standard to adopt for free-to-air broadcast, Barnes said.