Pro Forma Financial Information for the Planned Combination of Alma Media and Talentum

Alma Media Corporation     Stock Exchange Release      14 October 2015 at 4:25 p.m.

Pro Forma Financial Information for the Planned Combination of Alma Media and Talentum

This stock exchange release may not be published or distributed, in whole or in part, directly or indirectly, in the United States of America, Australia, Canada, Hong Kong, Japan, New Zealand, South Africa, or any other country where such publication or distribution would violate applicable regulation or would require additional measures in addition to the requirements under Finnish law.

On 29 September 2015, Alma Media Corporation (“Alma Media” or the “Company”) and Talentum Corporation (“Talentum”) announced their plan to combine their businesses by means of a public exchange offer made by Alma Media to Talentum's shareholders and option right holders, which offer is recommended by Talentum's Board of Directors to its shareholders and option right holders. As part of the Exchange Offer preparation process, Alma Media has compiled unaudited pro forma financial information for the year 2014 and for the first six month period of 2015. Unaudited pro forma financial information is presented to illustrate the financial impact of the combination on Alma Media’s financial information. The unaudited pro forma financial information is presented for illustrative purposes only. Because of its nature, the unaudited pro forma financial information addresses a hypothetical situation and, therefore, does not represent Alma Media’s actual results of operations or financial position.

The unaudited pro forma financial information included in this Stock Exchange Release and in the Annex 1 is based on financial information derived from Alma Media’s and Talentum’s audited consolidated financial statements as at and for the year ended 31 December 2014 and unaudited interim financial information for the six month period ended 30 June 2015. The unaudited pro forma financial information has been prepared on a basis consistent with IFRS as adopted by the EU and in a manner consistent with the accounting principles applied in Alma Media’s consolidated financial statements.

The unaudited pro forma statement of comprehensive income for the year ended 31 December 2014 and for the six months ended 30 June 2015 have been compiled assuming that the combination had been completed on 1 January 2014.The unaudited pro forma balance sheet as of 30 June 2015 has been compiled assuming the combination had been completed on 30 June 2015.

The pro forma adjustments in the unaudited pro forma financial information are based upon available information and certain assumptions, which are described in the accompanying notes. It should be noted that due to the nature of the Exchange Offer, Alma Media has not had access to Talentum’s accounting records or to any other Talentum internal documentation and, as a result, the pro forma financial information is solely based on publicly available information of Talentum. There can be no assurance that the assumptions used in the preparation of the unaudited pro forma financial information will prove to be correct. Further, the purchase price allocation has been made as a preliminary and based on the balance sheet information as at June 30, 2015, as a result, the final outcome of the Combination at the acquisition date may materially differ from this unaudited pro forma financial information.

Unaudited pro forma statement of comprehensive income for the six month period ended 30 June 2015

MEUR Alma Media Talentum Pro forma Alma Media
adjustments Pro forma
(unaudited) (unaudited) (unaudited) (unaudited)
Revenue 144,9 37,0 -0,2 181,7
Other operating income 3,0 0,3 3,3
Materials and services -36,4 -5,0 -41,4
Expenses arising from employee benefits -62,5 -17,9 -80,4
Depreciation, amortisation and impairment charges -6,8 -0,6 -0,5 -8,0
Other operating expenses -31,4 -12,1 0,3 -43,3
Share of profit of associated companies 0,1 -0,1 0,0
Operating profit 10,8 1,7 -0,6 11,9
Finance income 0,3 0,1 0,4
Finance expenses -1,3 -0,3 -0,1 -1,7
Share of profit of associated companies 0,5 -0,4 0,2
Profit before tax 10,4 1,5 -1,1 10,7
Income tax -2,2 -0,1 0,1 -2,2
Profit for the period 8,2 1,3 -0,9 8,5
Other comprehensive income
Items that are not later transferred to berecognised through profit or loss
Items arising due to the redefinitionof net defined benefit liability (or assetitem)
Tax on items that are not latertransferred to be recognised throughprofit or loss
Items that may later be transferred to berecognised through profit or loss
Translation differences 0,6 0,5 1,1
Share of other comprehensive incomeof associated companies 0,2 -0,2 0,0
Other comprehensive income for theyear, net of tax 0,7 0,5 -0,2 1,1
Total comprehensive incomefor the period 8,9 1,9 -1,1 9,7
Profit for the period attributable to
Owners of the parent 7,0 1,3 -0,9 7,4
Non-controlling interest 1,1 0,0 1,1
Total comprehensive income for the period attributable to
Owners of the parent 7,7 1,8 -1,1 8,5
Non-controlling interest 1,1 1,1

Unaudited pro forma statement of comprehensive income for the year ended 31 December 2014

MEUR Alma Media Talentum Pro forma Alma Media
adjustments Pro forma
(audited) (audited) (unaudited) (unaudited)
Revenue 295,4 72,3 -0,5 367,2
Other operating income 3,2 0,7 3,9
Materials and services -77,5 -10,0 -87,5
Expenses arising from employee benefits -120,8 -34,5 -155,3
Depreciation, amortisation and impairment charges -15,7 -1,3 -1,0 -18,0
Other operating expenses -64,0 -24,0 -1,9 -89,9
Share of profit of associated companies 0,2 -0,2 0,0
Operating profit 20,7 3,4 -3,6 20,4
Finance income 0,4 0,8 1,2
Finance expenses -3,1 -0,4 -0,2 -3,7
Share of profit of associated companies 1,7 -0,7 1,0
Profit before tax 19,7 3,8 -4,6 18,9
Income tax -4,0 -1,1 0,3 -4,7
Profit for the period 15,7 2,8 -4,3 14,2
Other comprehensive income
Items that are not later transferred to berecognised through profit or loss
Items arising due to the redefinitionof net defined benefit liability (or assetitem) -0,3  0,3 0,1
Tax on items that are not latertransferred to be recognised throughprofit or loss 0,0  -0,1 -0,1
Items that may later be transferred to berecognised through profit or loss
Translation differences 0,2 -1,6 -1,4
Share of other comprehensive incomeof associated companies -0,4 0,4 0,0
Other comprehensive income for theyear, net of tax -0,6 -1,3 0,4 -1,5
Total comprehensive incomefor the period 15,1 1,5 -3,9 12,7
Profit for the period attributable to
Owners of the parent 14,2 2,8 -4,3 12,7
Non-controlling interest 1,5 0,0 1,5
Total comprehensive income for the period attributable to
Owners of the parent 13,6 1,5 -3,9 11,2
Non-controlling interest 1,5 1,5

Unaudited pro forma balance sheet as at 30 June 2015

MEUR Alma Media Talentum Pro forma Alma Media
adjustments Pro forma
(unaudited) (unaudited) (unaudited) (unaudited)
Non-current assets
Intangible assets 38,1 15,5 11,9 65,5
Goodwill 73,9 21,1 30,9 125,9
Property, plant and equipment 73,0 0,8 73,8
Investments in associated companies 25,3 0,4 -19,4 6,4
Other non-current financial assets 3,7 0,8 4,4
Deferred tax assets 1,4 0,6 2,0
Total non-current assets 215,4 39,2 23,5 278,0
Current assets
Inventories 1,2 1,0 2,2
Current assets 28,6 10,6 0,1 39,3
Cash and cash equivalents 13,6 2,7 -2,2 14,1
Total current assets 43,4 14,3 -2,1 55,6
Total assets 258,7 53,5 21,4 333,6
Equity
Share capital 45,3 18,6 -18,6 45,3
Share premium reserve 7,7 7,7
Treasury shares -0,8 0,8 0,0
Foreign currency translation reserve -1,9 -0,5 0,5 -1,9
Reserve for invested unrestricted equity 0,0 -1,5 20,4 18,9
Retained earnings 36,1 2,5 -4,9 33,7
Equity attributable to owners of theparent 87,2 18,3 -1,8 103,7
Non-controlling interest 15,0 0,1 15,1
Total equity 102,2 18,4 -1,8 118,8
Non-current liabilities
Non-current interest-bearingliabilities 69,1 1,3 70,4
Deferred tax liabilities 7,0 3,2 2,3 12,6
Pension liabilities 2,7 0,1 2,8
Provisions 0,0 0,2 0,2
Total non-current liabilities 78,8 4,8 2,3 86,0
Current liabilities
Current financial liabilities 11,8 6,8 20,9 39,4
Advances received 19,5 12,5 32,0
Provisions 0,5 0,5
Trade and other payables 46,0 10,9 56,9
Total current liabilities 77,7 30,3 20,9 128,8
Total equity and liabilities 258,7 53,5 21,4 333,6

Annex 1: Unaudited pro forma financial information published by Alma Media

ALMA MEDIA CORPORATION

BOARD OF DIRECTORS

Further information:

Juha Nuutinen, Chief Financial Officer, Tel. +358 10 665 3873

Distribution: NASDAQ OMX Helsinki Ltd, Main Media, www.almamedia.fi

Alma Media in brief

Alma Media is a media group focusing on digital services and publishing. In addition to news services, the company's products provide useful information related to lifestyle, career, and business development. The services of Alma Media have expanded from Finland to the Nordic countries, the Baltics, and Central Europe. In 2014, the company employed, on average, 1,830 professionals (excluding distributors), of whom approximately one quarter work outside Finland. Alma Media’s revenue in 2014 totalled approximately EUR 295 million. The company's share is listed on NASDAQ OMX Helsinki Ltd. For more information please visit our website: www.almamedia.fi.

Important Notice

This release may not be released or otherwise distributed, in whole or in part, in or into the United States of America, Australia, Canada, Hong Kong, Japan, New Zealand, South Africa or any other jurisdiction where prohibited by applicable laws or regulations. This release is not an exchange offer document or a prospectus and as such does not constitute an offer or invitation to make a sales offer. Investors shall accept the exchange offer for the shares only on the basis of the information provided in an exchange offer document and prospectus in respect of the exchange offer. Offers will not be made directly or indirectly in any jurisdiction where either an offer or participation therein is prohibited by applicable law or where any exchange offer document or registration or other requirements would apply in addition to those undertaken in Finland.

The exchange offer document and prospectus in respect of the exchange offer as well as related acceptance forms will not and may not be distributed, forwarded, or transmitted into, in, or from any jurisdiction where prohibited by applicable law. In particular, the exchange offer is not being made, directly or indirectly, in or into, Australia, Canada, Hong Kong, Japan, New Zealand, South Africa, or the United States of America. The exchange offer cannot be accepted from within Australia, Canada, Hong Kong, Japan, New Zealand, South Africa, or the United States of America.

Alma Media's shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), or under any of the relevant securities laws of any state or other jurisdiction of the United States of America. Alma Media's shares may not be offered or sold in the United States, except pursuant to an exemption from the Securities Act or in a transaction not subject to the registration requirements of the Securities Act.

Certain statements herein which are not historical facts, including, without limitation, those regarding expectations for general economic development and the market situation, expectations for the combined company’s development and profitability and the realization of synergy benefits and cost savings, and statements preceded by “expects”, ”estimates”, ”forecasts” or similar expressions, are forward-looking statements. These statements are based on current decisions and plans and currently known factors. They involve risks and uncertainties which may cause the actual results to materially differ from the results currently expected for the combined company. Such factors include, but are not limited to, general economic conditions, including fluctuations in exchange rates and interest levels which influence the operating environment and profitability of customers and thereby the orders received by the combined company and their margin; the competitive situation; the combined company’s own operating conditions, such as the success of production and product development and their continuous development and improvement; and the success of future acquisitions.

  • Date: 14.10.2015, 16:25
  • News type: Stock exchange release

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