Alma Media Corporation Interim Report 18 July 2014 at 9:00am (EEST)
Alma Media's Interim Report January-June 2014:
SIGNIFICANT IMPROVEMENT IN OPERATING PROFIT EXCLUDING NON-RECURRING ITEMS IN THE SECOND QUARTER
Financial performance April-June 2014:
- Revenue MEUR 75.7 (76.3), down 0.9%.
- Online sales increased by 13.4% to MEUR 23.8 (21.0).
- EBITDA (Earnings before interest, taxes, depreciation and amortisation) excluding non-recurring items MEUR 9.7 (8.0), up 21.4%.
- EBITDA MEUR 9.5 (16.0), down 40.2%.
- Operating profit excluding non-recurring items MEUR 6.3 (4.6) or 8.3% (6.0%) of revenue, up 37.3%.
- Operating profit MEUR 6.1 (9.5) or 8.1% (12.4%) of revenue, down 35.5%.
- Profit for the period MEUR 4.8 (7.9), down 40.1%.
- The operating profit for April-June includes non-recurring items of MEUR -0.2 (4.9).
- Earnings per share EUR 0.06 (0.10).
Financial performance January-June 2014:
- Revenue MEUR 148.4 (151.2), down 1.9%.
- Online sales increased by 12.2% to MEUR 47.5 (42.4).
- EBITDA excluding non-recurring items MEUR 15.8 (16.0), down 1.4%.
- EBITDA MEUR 16.4 (23.9), down 31.7%.
- Operating profit excluding non-recurring items MEUR 8.8 (10.1), or 5.9% (6.6%) of revenue, down 12.6%.
- Operating profit MEUR 9.3 (14.9) or 6.3% (9.9%) of revenue, down 37.4%.
- Profit for the period MEUR 6.9 (12.0), down 42.5%.
- The operating profit for January-June includes non-recurring items of MEUR -0.6 (4.9).
- Earnings per share EUR 0.08 (0.15).
|Content revenue, print||25.7||27.4||-1.7||-6.2||51.8||55.6||-3.8||-6.9||111.2|
|Content revenue, online||1.4||0.8||0.6||71.1||2.6||1.6||1.0||60.3||3.8|
|Advertising revenue, print||20.6||21.6||-0.9||-4.3||37.6||40.6||-3.0||-7.5||80.0|
|Advertising revenue, online||18.5||16.6||1.9||11.4||36.7||33.7||3.0||8.8||66.5|
|Total expenses excluding non-recurring items||69.5||71.9||-2.4||-3.3||139.9||141.5||-1.6||-1.1||276.7|
|EBITDA excluding non-recurring items||9.7||8.0||1.7||21.4||15.8||16.0||-0.2||-1.4||37.5|
|Operating profit excluding non-recurring items||6.3||4.6||1.7||37.3||8.8||10.1||-1.3||-12.6||24.2|
|% of revenue||8.3||6.0||5.9||6.6||8.0|
|% of revenue||8.1||12.4||6.3||9.9||9.0|
|Profit for the period||4.8||7.9||-3.2||-40.1||6.9||12.0||-5.1||-42.5||16.0|
|Earnings per share, EUR (basic)||0.06||0.10||-0.05||-44.6||0.08||0.15||-0.07||-47.8||0.20|
|Earnings per share, EUR (diluted)||0.06||0.10||-0.05||-44.6||0.08||0.15||-0.07||-47.8||0.20|
|Online sales, % of net sales||31.4||27.5||32.0||28.0||28.1|
Outlook for 2014:
Economic growth in Europe, and in particular Finland, is expected to remain weak also in the second half of 2014. In this market situation, Alma Media's strong growth in digital service revenue does not yet fully offset the decline in the sales of print media.
Alma Media expects its full-year revenue 2014 to remain at the 2013 level. The operating profit excluding non-recurring items for 2014 is expected to be lower than in 2013. The full-year revenue 2013 was MEUR 300.2 and operating profit excluding non-recurring items was MEUR 24.2.
Kai Telanne, President & CEO:
The prolonged slowdown of the Finnish economy saw the media market remain weak in the second quarter. Total advertising volume declined by 2.3% in January-June 2014.
In spite of the difficult operating environment, Alma Media's long-term focus on digital business operations, combined with reducing the cost structure of the newspaper business, produced positive results. The Group's revenue in the second quarter remained at the same level as in the comparison period, while digital revenue increased by more than 13% year-on-year. Operating profit excluding non-recurring items increased by 37% as the growth in online advertising revenue substantially exceeded the decrease in print media sales.
In the second quarter, Alma Media continued to develop content solutions for mobile media and video. New mobile applications and tablet publications played a key role in mobile development, with new such products launched by Iltalehti and Kauppalehti, among others.
In the advertising market, interest in Alma Media's new advertising tools and solutions grew. Sales of customised native and content marketing solutions developed favourably, particularly at Iltalehti and Kauppalehti. Digital sales already accounted for approximately two thirds of Iltalehti's advertising revenue.
To ensure the profitability of regional publishing operations and the quality of content, Alma Media and five other Finnish newspaper publishers signed an agreement in the second quarter on journalistic collaboration and establishing Lännen Media Oy. The collaboration will start in autumn 2014 and will result in the regional papers benefiting from a significant amount of new content to be utilised in both the print newspaper and paid online services.
Due to the economic recession and weakened macroeconomic forecasts, Alma Media is seeking cost savings by streamlining its operations, processes and organisation. In the second quarter, Alma Regional Media reached an agreement on savings in annual personnel costs of approximately MEUR 1.5 for 2014. The savings will be achieved by exchanging bonus holiday pay for days off, or alternatively by temporary layoffs. The efficiency of Alma Media's financial administration will also be improved by consolidating operations in Tampere.
In a time of transformational changes in the media industry, Alma Media is supported by a strong strategy and a clear direction towards a digital future. Rapid market changes make it essential that the implementation of strategy moves ahead quickly. All of Alma Media's business units will continue to focus their resources on digital business and invest strongly in developing their digital expertise.
For more information, please contact:
Kai Telanne, President and CEO, telephone +358 10 665 3500
Juha Nuutinen, CFO, telephone +358 10 665 3873
Alma Media Corporation follows the disclosure procedure enabled by Standard 5.2b published by the Finnish Financial Supervision Authority. This stock exchange release is a summary of Alma Media Corporation's Interim Report January - June 2014. The complete report is attached to this release in pdf format. The Interim Report is also available on Alma Media's website at www.almamedia.com/investors/.
Conference, webcast and conference call
A conference for Finnish media, investors and analysts will be held on the same day at 11.00-12.00 EEST in the Alma House (address: Alvar Aallon katu 3 C, Helsinki). In addition to the presentations held by President & CEO Kai Telanne and CFO Juha Nuutinen, participants will have an opportunity to discuss with other members of the company's management. Please note that the conference will be held in Finnish. The presentation material in English will be available on www.almamedia.com/press_room/downloads/presentations/ at 11.00 EEST.
To participate in the conference, kindly register beforehand by e-mail, firstname.lastname@example.org.
An international conference call and audio webcast concerning the financial result of January-June 2014 will begin at 13.00 EEST. You can participate in the conference by calling +44(0)20 3427 1915 (confirmation code: 7795625) or follow the direct transmission at www.almamedia.com/press_room/downloads/presentations/.
Vice President, Corporate Communications and IR
Alma Media Corporation
DISTRIBUTION: NASDAQ OMX Helsinki, main media
Alma Media in brief
Alma Media is a media company 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. The company employs 1,965 professionals (excluding distributors), of whom approximately one third work outside Finland. Alma Media's revenue in 2013 totalled approximately MEUR 300. Alma Media's share is listed on NASDAQ OMX Helsinki. Read more at www.almamedia.com.