Alma Media's Interim Report January-September 2014: Digital advertising sales exceeded print advertising sales in the third quarter, operating profit decreased as estimated

Alma Media Corporation         Interim Report                            24 October 2014 at 9:00 am (EEST)

Alma Media's Interim Report January-September 2014:
DIGITAL ADVERTISING SALES EXCEEDED PRINT ADVERTISING SALES IN THE THIRD QUARTER, OPERATING PROFIT DECREASED AS ESTIMATED
                                                                                                                 
Financial performance July-September 2014:

- Revenue MEUR 70.5 (71.7), down 1.8%.
- Online sales increased by 9.4% to MEUR 22.1 (20.2).
- EBITDA (Earnings before interest, taxes, depreciation and amortisation) excluding non-recurring items MEUR 10.4 (11.4), down 8.8%.
- EBITDA MEUR 9.9 (11.4), down 13.4%.
- Operating profit excluding non-recurring items MEUR 7.0 (7.8) or 9.9% (10.8%) of revenue, down 9.9%.
- Operating profit MEUR 6.5 (7.8) or 9.2% (10.8%) of revenue, down 16.6%.
- Profit for the period MEUR 4.8 (5.9), down 19.4%.
- The operating profit for July-September includes non-recurring items of MEUR -0.5 (0.0).
- Earnings per share EUR 0.06 (0.07).

Financial performance January-September 2014:

- Revenue MEUR 218.8 (223.0), down 1.9%.
- Online sales increased by 11.2% to MEUR 69.6 (62.6).
- EBITDA excluding non-recurring items MEUR 26.2 (27.4), down 4.5%.
- EBITDA MEUR 26.2 (35.4), down 25.8%.
- Operating profit excluding non-recurring items MEUR 15.8 (17.8), or 7.2% (8.0%) of revenue, down 11.4%.
- Operating profit MEUR 15.8 (22.7) or 7.2% (10.2%) of revenue, down 30.3%.
- Profit for the period MEUR 11.7 (17.9), down 34.9%.
- The operating profit for January-September includes non-recurring items of MEUR 0.0 (4.9).
- Earnings per share EUR 0.14 (0.23).

KEY FIGURES 2014 2013 Change 2014 2013 Change 2013
MEUR Q3 Q3   % Q1-Q3 Q1-Q3   % Q1-Q4
Revenue 70.5 71.7 -1.3 -1.8 218.8 223.0 -4.1 -1.9 300.2
Content revenue 28.0 29.2 -1.1 -3.9 82.4 86.6 -4.1 -4.8 115.3
  Content revenue, print 26.6 27.9 -1.3 -4.6 78.4 83.5 -5.1 -6.1 111.2
  Content revenue, online 1.4 1.1 0.3 29.4 4.0 2.7 1.3 48.0 3.8
Advertising revenue 33.5 34.1 -0.6 -1.7 107.8 108.9 -1.1 -1.0 147.3
  Advertising revenue, print 16.3 18.3 -2.0 -10.7 53.9 58.9 -5.0 -8.5 80.0
  Advertising revenue, online 17.2 15.7 1.5 9.4 53.8 49.4 4.4 8.8 66.5
Service revenue 8.9 8.5 0.4 4.9 28.6 27.5 1.1 4.1 37.6
Total expenses excluding non-recurring items 63.5 64.1 -0.6 -1.0 203.4 205.6 -2.2 -1.1 276.7
EBITDA excluding non-recurring items 10.4 11.4 -1.0 -8.8 26.2 27.4 -1.2 -4.5 37.5
EBITDA  9.9 11.4 -1.5 -13.4 26.2 35.4 -9.1 -25.8 45.3
Operating profit excluding non-recurring items 7.0 7.8 -0.8 -9.9 15.8 17.8 -2.0 -11.4 24.2
% of revenue 9.9 10.8     7.2 8.0     8.0
Operating profit 6.5 7.8 -1.3 -16.6 15.8 22.7 -6.9 -30.3 27.0
% of revenue 9.2 10.8     7.2 10.2     9.0
Profit for the period 4.8 5.9 -1.1 -19.4 11.7 17.9 -6.3 -34.9 16.0
Earnings per share, EUR (basic) 0.06 0.07 -0.02 -23.6 0.14 0.23 -0.09 -39.7 0.20
Earnings per share, EUR (diluted) 0.06 0.07 -0.02 -23.6 0.14 0.23 -0.09 -39.7 0.20
                   
Online sales 22.1 20.2 1.9 9.4 69.6 62.6 7.0 11.2 84.5
Online sales, % of net sales 31.4 28.2     31.8 28.1     28.1

Outlook for 2014:

Economic growth in Europe, and in particular Finland, is expected to remain weak also in 2014. In this market situation, Alma Media's 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 economic situation in Finland remained weak in the third quarter of 2014, and the situation is not expected to improve in the fourth quarter. The weak economic situation affected the total advertising volume, which decreased by 2,7% in July-September 2014.

Alma Media's revenue decreased by 1.8% in the third quarter. The decline in revenue was attributable to the Group's operations in Finland (-2.5%). The growth of international operations balanced out the decline in Alma Media's Finnish units. Excluding the impact of divested business operations, the revenue of Alma Media's units outside Finland grew by 17.4%, particularly due to the strong development of recruitment services. 

Bolstered by significant changes in consumer behaviour and media consumption, Alma Media's digital business activities continued to achieve growth in the third quarter. Alma Media's digital media sales exceeded advertising revenue from print media for the first time: online advertising revenue grew by 9.4%, while print media sales declined by 10.7%.

Alma Media continued to place a significant focus on a multi-channel approach to its publishing operations. In the Financial Media and Business Services segment, the share of digital business has increased this year to reach 43.1% of revenue. Digital advertising sales grew in the National Media segment, although the rate of growth decreased from the level earlier in the year. In the Regional Media segment, print media circulations continued to decrease, but the additional sales brought about by the new printing facility offset the decline.

Due to the recession and weak macroeconomic outlook, Alma Media implemented several measures in the third quarter to increase its cost efficiency. Alma 360 and IL-Media, among others, carried out organisational restructuring to improve their competitiveness in the digitalising operating environment. In addition, the printing and distribution company Alma Manu reorganised its distribution and transport network to better respond to customer needs.

For more information, please contact:
Kai Telanne, President and CEO, telephone +358 10 665 3500
Juha Nuutinen, CFO, telephone +358 10 665 3873

Disclosure procedure:

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 - September 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, kutsut@almamedia.fi.

An international conference call and audio webcast concerning the financial result of January-September 2014 will begin at 13.00 EEST. You can participate in the conference by calling +44(0)20 3427 1914 (confirmation code: 2135599) or follow the direct transmission at www.almamedia.com/press_room/downloads/presentations/.

Rauno Heinonen
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.

  • Date: 24.10.2014, 11:00
  • News type: Stock exchange release

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