Utusan won't cease operations, will increase prices instead
The Utusan Group today announced it will not cease operations tomorrow but will instead opt to increase the price of newspapers under its stable, namely Utusan Malaysia and Kosmo.
This was announced by group executive chairperson Abd Aziz Sheikh Fadzir (photo, above) after a town hall meeting with the company's staff...
The Utusan Group today announced it will not cease operations tomorrow but will instead opt to increase the price of newspapers under its stable, namely Utusan Malaysia and Kosmo.
This was announced by group executive chairperson Abd Aziz Sheikh Fadzir (photo, above) after a town hall meeting with the company's staff.
Aziz said the price of Utusan Malaysia will be increased by 33 percent from RM1.50 to RM2 while the price of Kosmo will be increased by 50 percent from RM1 to RM1.50.
He urged the public to support its newspapers under the revised prices.
"If we are to rescue Utusan, we must return to a media business model. I ask that the people show their sympathy to Utusan by purchasing our newspapers and advertise with us.
"I explained that we will need a long time to balance our expenditure," he told a press conference at the Utusan Malaysia headquarters today.
On Monday, Utusan staff was informed the group will cease print publication due to financial difficulties. Some of its staff have not been paid for three months.
However, a day ahead of the deadline, the company's management had sought to keep the troubled daily going.
Elaborating further, Aziz said the company had to raise prices for both dailies to support its operational costs.
“With the increase, and based on an estimated monthly sale of 50,000 copies for Utusan Malaysia and 100,000 copies for Kosmo, we expect this would contribute about RM2.3 million per month for Utusan.
“Based on the latest report to Bursa Malaysia, we experienced a loss of RM3 million per month, but we expect to reduce our deficit to RM750,000 per month through newspaper sales.
“We hope the sentiment to help Utusan and to ensure it continues operations after 80 years in the community would materialise through sales, even though the price has been increased,” he said.
Aziz said the management is confident that Utusan’s finances would be stable between 2020 and 2021 if they succeed in selling some assets, raise advertising revenue, and increase readership for its two daily newspapers.
As for outstanding salaries to its staff, Aziz said the management has agreed to pay RM2,000 to 800 Utusan staff today as a short-term measure, although no guarantees had been made for the long term.
“We have to raise the price of newspapers, and if readership is maintained or increased, and if the asset sale is completed, I’m confident we can pay the salaries on time,” he said, while confirming that the group is facing difficulties selling one asset due to the lack of a certificate of fitness.
Asked whether there are investors who want to invest in Utusan or buy its assets, Aziz said several investors have expressed interest but became sceptical after seeing Utusan’s financial situation.
“Several investors have shown interest, but when they see the projections and cash outflows each month, they get worried,” he said, adding that Utusan is open to merging with any media entity.
He said the outstanding payments for salary and voluntary separation scheme amount to nearly RM10 million, comprising over RM3 million in unpaid salaries and RM6 million for the VSS.
Asked about Utusan’s editorial stand which had been accused of being biased, Aziz stressed that Umno had never interfered with Utusan’s editorial decisions since he was appointed as chairperson.
“Our platform is the people’s platform. We want to help put forward the people’s views, although when we do that, we are seen as opposing the government. That is not our agenda.
“We are not Umno’s mouthpiece. Umno had never interfered with editorial decisions. Utusan is free to write anything, but must be responsible,” he said.
