62 Annual Report 2016 Fraser and Neave, Limited & Subsidiary Companies CEO BUSINESS REVIEW

PUBLISHING & PRINTING

By focusing on maintaining and developing strategic alliances with our key partners and creating greater brand awareness, we have placed Marshall Cavendish at the forefront of education.

MR SIEW PENG YIM Chief Executive Officer, Times Publishing Group

PUBLISHING & PRINTING base and the absence of a one-off partnerships with various international GROUP RESULTS catch up of depreciation charges. publishers and secured new catalogue printing work in , Malaysia FY2016 marked an exciting year for the Marshall Cavendish, our publishing and China. Publishing & Printing division (“P&P”) arm, continued its push into the amid continued difficult operating international educational publishing Leveraging our leading position in environment. Consequently, we saw market. This year, we added South the education publishing sector, mixed performances across our Africa, Spain and Colombia to our P&P will be officially rolling out Times P&P division. Retail and Distribution global footprint of over 60 countries, Experience and GoGuru in FY2017. recorded revenue gains, aided by while making further inroads into Times Experience is an event organiser strong sales performance in airport the UK with strong school adoptions. with events centred on ways to retail and high street stores, higher By focusing on maintaining and enhance a child’s learning experience partwork sales in Hong Kong and developing strategic alliances with beyond the classroom. Tapping on higher contribution from magazine our key partners and creating greater Marshall Cavendish Education’s Distribution in Singapore. Publishing, brand awareness, we have placed expertise in education, Times on the other hand, recorded lower Marshall Cavendish at the forefront Experience offers quality educational revenue as a result of a slow-down of education. content in a relatable and in demand for our textbooks due to contemporary approach for the the end-of-school adoption cycle. Our decision to rationalise our modern child. Happy Sparks will be the Similarly, lower print volumes in printing plants last year in anticipation first event managed by Times Singapore and Malaysia as well of weak volume and margin pressure Experience in Singapore and together as the discontinuation of a joint has helped to ensure that profitability with GoGuru, Times Publishing Group’s venture in China caused Print of our Print division could be sustained. e-commerce portal, it is our aim to revenue to fall. Accordingly, P&P The Print division is now leaner and engage our customers directly and FY2016 revenue declined 10%, better able to meet the challenges increase consumer touch points to $308m. Despite the decline in the market. This year, while providing a wider offering of products, in revenue, we were able to narrow Singapore and Malaysia saw a fall in services and solutions focusing on our operating losses substantially print volumes, we saw recoveries in learning. In addition, P&P will also be in FY2016 to $5m, from $15m in China, with encouraging resumption of launching Brainy Arkies – an adaptive FY2015. This was mainly the result book orders from overseas customers learning app, in FY2017, giving us the of last year’s restructuring exercise in the second half of FY2016. We have opportunity to showcase our ability to to reduce Print’s operating cost also successfully renewed business create innovative solutions. Fraser and Neave, Limited & Subsidiary Companies Annual Report 2016 63

In This Section Publishing & Printing Group Results 62 Publishing & Printing • Publishing 63 Publishing & Printing • Print 65 Publishing & Printing • Retail & Distribution 65

Amid challenging times, we will Attended by 150 international also continue to expand our influence policymakers, curriculum specialists, Publishing & Printing in the field of educational retail school leaders and educators, the huge through aggressive brand profile turnout to the 2016 MCE Conference development over digital media and bears testament to the growing on e-commerce platforms as well as recognition of Singapore’s world-class through the launch of a new lifestyle curriculum. bookstore concept, while looking Also in Singapore, MCE collaborated to further improve manufacturing Over with leading US adaptive learning efficiency and cost management in technology company, Knewton, to our Print division. introduce a personalised adaptive Mathematics solution MCEduworld PUBLISHING 60 in early 2016. Supported by Infocomm The Group’s publishing business Development Authority of Singapore, Export is marketed under the brand, nine schools in Singapore have Marshall Cavendish (“MC”). As a embarked on this pilot programme. Countries major international content provider, MC publishes extensively with MCE, together with its partners, Key Highlights interests spanning Education, won the tender for the development General Interest, Business of Student Learning Space for the Information and Home Reference. Ministry of Education, Singapore Revenue ($m) (“MOE”). The new online Teaching and Publishing revenue declined primarily Learning Application System and Digital due to lower Education Publishing Resource Library will provide teachers revenue. Demand for US textbooks and students access to quality digital were affected by the end-of-school teaching and learning resources adoption cycle. However, growth in produced by MOE, teachers and 341 non-US export markets were in line those curated from other sources. 308 with expectations. Riding on the successes of “Primary Publishing: Education Mathematics” and “Math in Focus”, this year, MCE developed “Math On”, While Marshall Cavendish Education an online supplement that contains FY2015 FY2016 (“MCE”) continued to develop new comprehensive assessment tools print and digital educational content Change from FY2015 and interactive digital resources -10% in its existing markets in Singapore, aligned to the US Common Core Hong Kong and the US, it also looked State Standards. This new addition to push for more adoption of its Profit Before Interest to its suite of innovative digital & Taxation ($m) content in new markets. This year, MCE solutions enables MCE to continue successfully took its Math programme to stamp its authority in the area of to Spain and Colombia, further Mathematics in the US. strengthening its brand position -5 in Latin America. Beyond the US, MCE also continued its efforts to promote the “Inspire Maths” In Singapore, MCE has long advocated series in partnership with Oxford -15 the importance of enhancing teachers’ University Press to bring its Singapore capacity to improve student learning Maths programme into the UK. An and development outcomes with its extensive series of events focusing on annual MCE Conference. For the fifth public relations, professional FY2015 FY2016 year running, this three-day event development as well as online Change from FY2015 nm continued to enjoy strong support. campaigns drove new adoptions. 64 Annual Report 2016 Fraser and Neave, Limited & Subsidiary Companies CEO BUSINESS REVIEW

PUBLISHING & PRINTING

inter-school STEM project competitions were also organised with good participation rates from schools.

Publishing: Others General and Reference (“GR”) successfully published several high profile titles in 2016. These included “It’s Easy to Cry” (by the late criminal Subhas Anandan), “Up Close with ” (essays from 37 close friends and colleagues of Mr Lee) and “Conversations with Tunku Abdul Rahman” (Malaysia’s first prime minister). Marshall Cavendish Education conceptualised many initiatives to Hong Kong (“MCE HK”) has also done encourage STEM amongst the youth. The late Subhas Anandan’s second well this year. Knowing that Hong Kong In addition, MCE also established the book “It’s Easy to Cry” was launched places a strong emphasis on Science, MC STEM Academy, in partnership with posthumously in December 2015. Technology, Engineering and technology providers and an advisory Subhas was Singapore’s best-known Mathematics (“STEM”) education board of esteemed educators. As a criminal lawyer with an empathy for all for their students, MCE HK, leveraging result, it managed to organise hands- his clients, and a foremost champion its position as a curriculum leader, on STEM workshops which saw of pro bono work. The book held its integrated various subjects into overwhelming attendance for each place on the Bestsellers List for a Hong Kong’s STEM education and event. In addition to workshops, record 20 weeks.

United States United Kingdom China of America Hong Kong

Thailand

Malaysia Singapore

Australia

Chile

Offices Manufacturing Plants Fraser and Neave, Limited & Subsidiary Companies Annual Report 2016 65 Publishing & Printing

recorded improved sales on the back of higher export.

RETAIL & DISTRIBUTION Retail and Distribution division (“R&D”) experienced revenue gains due to improved scale in magazine distribution, strong partwork sales and higher contribution from new retail stores opened in high-street and airport.

This year, R&D continued to strengthen its retail positioning by catering to the varied interests and ages of consumers, especially families and children, inspiring and engaging them with more creative and interactive in-store activities. As such the ongoing GR continued its tradition of publishing PRINT rebranding efforts of Times Bookstores biographies of influential individuals in The Printing operations in Singapore to encourage community building have Asia and beyond with “Up Close with and Malaysia continued to face a shown encouraging results. Lee Kuan Yew”. This intimate collection challenging printing environment. of 37 essays by Mr Lee’s closest colleagues and friends was launched in The challenges included lower print March 2016. The book was reviewed volumes and margin pressure. As a favourably by mainstream media result of FY2015’s restructuring sources and quickly took the No. 1 spot exercise to reduce its cost structure, on Bestsellers List. Print division was able to narrow its Beyond our shores, MCIA, our GR losses this year, despite a drop in publishing arm, had the opportunity to revenue. The restructuring efforts to publish several strong Malaysian titles realign capacity and demand as well as this year, most notably Conversations the absence of a one-off catch up of with Tunku Abdul Rahman. The book depreciation charges in 2015 helped launch took place at the Tunku Abdul improve the bottom line. The Printing Rahman memorial in April 2016. operations in China, on the other hand,