Readers, advertisers the big winners in NMG Sh2bn plan

From left: Nation Media Group directors James Montgomery, Gerry Wilkinson and Yasmin Jetha; Group Chief Executive Officer Linus Gitahi; Group Board of Directors Chairman Wilfred Kiboro; Group Secretary James Kinyua; and acting Editorial Director Tom Mshindi. They are viewing the model of the new printing plant at the plant's grounds on Mombasa Road on November 27, 2014. PHOTO | BILLY MUTAI

What you need to know:

  • “We are convinced that the print media industry in the developing world will continue to be relevant to both the readers and the advertisers for the next 10-15 years, and this is consistent with research carried out in the developing markets,” Mr Kiboro noted.
  • “The new state-of-the-art printing press design engenders features that will provide advertisers with more options and opportunities in terms of impactful advertising formats and capacity to carry more adverts in a single print run,” Mr Kiboro said.
  • Group chief executive Linus Gitahi said the extra capacity that comes with the new printing press will enable the business to undertake third-party contract printing jobs.
  • “Despite what people have said about the newspaper industry, we are confident that, (in) this part of the world, the industry will continue to grow and that is why we are making such a huge investment. The growth of the press is symptomatic of a country’s economic growth, so this will not just benefit (the) Nation but the whole country,” Mr Gitahi said.

Eastern Africa’s largest media house, Nation Media Group, is set to change the face of newspaper reporting with the setting up of a new state-of-the-art printing press.

The construction of the Sh2 billion printing press began Thursday at the company’s plant on Mombasa Road, with a completion date in the fourth quarter of 2015. The press hall is scheduled to be ready by June next year paving the way for installation of the printer.

NMG chairman Wilfred Kiboro said during the ground-breaking ceremony that the investment is a sign that the board of directors and management are confident of the future of the print media industry.

“We are convinced that the print media industry in the developing world will continue to be relevant to both the readers and the advertisers for the next 10-15 years, and this is consistent with research carried out in the developing markets,” Mr Kiboro noted.

IMPROVEMENT IN SPEED

The project will be financed using the company’s cash reserves, which stood at Sh4.2 billion as of June 30, 2014. NMG’s profit before tax grew to Sh1.7 billion in the period, helped by increased sales and prudent cost management.

With the new press, the company expects to realise a 45 per cent improvement in speed, printing up to 86,000 copies per hour and allowing the editorial team more time to refine content, turn around editions and improve market arrival times.

Beglin Woods Architects and Interior Designers are the project’s architects, while the contractor is Superfit Contractors Ltd and Structural Engineers.

The new printing press will also double the company’s capacity to print full-colour pages as well as allow for more advertising formats.

“The new state-of-the-art printing press design engenders features that will provide advertisers with more options and opportunities in terms of impactful advertising formats and (the) capacity to carry more adverts in a single print run,” Mr Kiboro said.

EXTRA CAPACITY

Group chief executive Linus Gitahi said the extra capacity that comes with the new printing press will enable the business to undertake third-party contract printing jobs.

“Despite what people have said about the newspaper industry, we are confident that, (in) this part of the world, the industry will continue to grow and that is why we are making such a huge investment. The growth of the press is symptomatic of a country’s economic growth, so this will not just benefit (the) Nation but the whole country,” Mr Gitahi said.

The new printing press was selected on the basis of global media consumption trends that were discussed with local media buying agencies and readers.

Some of the advertising formats will be exclusive to the Nation Newspaper Division, and no other competing publications in East and Central Africa will be able to offer the same features.

GROWING COMPETITION

Mr Kiboro said the growing competition in the print media as well as the threat posed by the penetration of the Internet means that companies must be more innovative and efficient in producing, packaging and delivering their products.

“We now have to be more strategic and innovative in how we drive advertising and circulation. In this regard, the use of colour and the quality of the adverts has to be world-class. Business as usual will not work in this day and age. Innovation around the products and delivery of the same is critical. I have every confidence that NMG understands this and will rise to the occasion,” Mr Kiboro said.

The printing press will replace the current one, which has served the company over the past 19 years. NMG publishes the Daily Nation, Business Daily, The EastAfrican and Taifa Leo in Kenya. It also runs a number of radio and television stations.

The group’s newspaper division continued to be a big driver of earnings, having cut operational costs by 14 per cent and returned an operating profit that was one per cent higher than a similar period last year.