Alma Media's Interim Report for January-September 2013: Growth in digital services slowed down revenue decline

Alma Media Corporation    Interim Report     October 25, 2013 at 9:00am (EEST)

Alma Media's Interim Report for January-September 2013:
GROWTH IN DIGITAL SERVICES SLOWED DOWN REVENUE DECLINE

Financial performance in July-September 2013:

- Revenue MEUR 71.1 (75.2), down 4.6%.
- Content revenue MEUR 29.2 (30.8), down 5.2%; advertising revenue MEUR 34.1 (36.1), down 5.5%; service revenue MEUR 8.5 (8.4), up 1.4%.
- EBITDA (Earnings before interest, taxes, depreciation and amortisation) excluding non-recurring items MEUR 11.4 (12.0), down 5.2%.
- EBITDA MEUR 11.4 (11.3), up 0.6%.
- Operating profit excluding non-recurring items MEUR 7.8 (8.9), 10.8% (11.8%) of revenue, down 12.6%.
- Operating profit MEUR 7.8 (8.1), 10.8% (10.8%) of revenue, down 4.7%.
- Profit for the period MEUR 5.9 (8.1), down 27.1%.
- Earnings per share EUR 0.07 (0.10).

Financial performance in January-September 2013:

- Revenue MEUR 223.0 (237.4), down 6.1%.
- Content revenue MEUR 86.6 (92.3), down 6.2%; advertising revenue MEUR 108.9 (118.6), down 8.1%; service revenue MEUR 27.5 (26.5), up 3.7%.
- EBITDA excluding non-recurring items MEUR 27.4 (34.5), down 20.4%.
- EBITDA MEUR 35.4 (29.8), up 18.5%.
- Operating profit excluding non-recurring items MEUR 17.8 (25.0), 8.0% (10.5%) of revenue, down 28.8%.
- Operating profit MEUR 22.7 (18.9), 10.2% (8.0%) of revenue, down 19.7%.
- Profit for the period MEUR 17.9 (15.3), up 17.2%.
- Earnings per share EUR 0.23 (0.19).

KEY FIGURES 2013 2012 Change 2013 2012 Change 2012
MEUR Q3 Q3 % Q1-Q3 Q1-Q3 % Q1-Q4
Revenue 71.7 75.2 -3.5 -4.6 223.0 237.4 -14.4 -6.1 320.1
Content revenue 29.2 30.8 -1.6 -5.2 86.6 92.3 -5.8 -6.2 122.3
Advertising revenue 34.1 36.1 -2.0 -5.5 108.9 118.6 -9.7 -8.1 160.8
Service revenue 8.5 8.4 0.1 1.4 27.5 26.5 1.0 3.7 37.1
Total expenses excluding non-recurring items 64.1 66.4 -2.3 -3.5 205.6 212.6 -7.0 -3.3 287.0
EBITDA excluding non-recurring items 11.4 12.0 -0.6 -5.2 27.4 34.5 -7.0 -20.4 45.1
EBITDA  11.4 11.3 0.1 0.6 35.4 29.8 5.5 18.5 39.5
Operating profit excluding non-recurring items 7.8 8.9 -1.1 -12.6 17.8 25.0 -7.2 -28.8 33.5
% of revenue 10.8 11.8     8.0 10.5     10.5
Operating profit 7.8 8.1 -0.4 -4.7 22.7 18.9 3.7 19.7 26.5
% of revenue 10.8 10.8     10.2 8.0     8.3
Profit for the period 5.9 8.1 -2.2 -27.1 17.9 15.3 2.6 17.2 17.4
Earnings per share, EUR (basic) 0.07 0.10 -0.03 -29.1 0.23 0.19 0.03 15.8 0.22
Earnings per share, EUR (diluted) 0.07 0.10 -0.03 -28.9 0.23 0.19 0.03 16.0 0.22

Outlook for 2013:

Economic growth in Europe, and in particular Finland, is expected to remain weak also in the fourth quarter of 2013. The decline in media advertising and the gradual shift of media consumption to digital channels will decrease the revenue and profitability of print media. In this market situation, Alma Media's strong growth in the sales of digital services does not yet fully offset the decline in the sales of print media.

Alma Media maintains its outlook given in the interim report published on 19 July 2013, according to which it expects the revenue and the operating profit excluding non-recurring items for the second half of 2013 and the full year to decline compared to the corresponding periods in 2012. Revenue for the second half of 2012 was MEUR 157.9 and operating profit excluding non-recurring items MEUR 17.4. Full-year revenue 2012 was MEUR 320.1 and operating profit excluding non-recurring items was MEUR 33.5.

Kai Telanne, President and CEO:

Alma Media's performance in the third quarter of 2013 was in line with expectations. The decline in revenue slowed down, and the company's digital services, in particular, performed well. In Finland, the single-copy and subscription sales of print newspapers continued to decline and media advertising decreased by 6,1% in the third quarter, which had an effect on Alma Media's profitability in the third quarter. In the third quarter, Alma Media's digital products and services represented 28.1% of Group revenue.

Digital recruitment services, which made up 10.9% of Alma Media's revenue in the third quarter, continued their strong performance, particularly in the Group's units outside Finland. Among the Group's marketplace services in Finland, Etuovi.com in particular has maintained a good level of profitability despite the slow home sales market. Alma Media saw strong growth in performance-based network advertising, which takes advantage of the Group's extensive online media portfolio and reaches nearly 5 million consumers a week. The company continues its active development of tools that facilitate easier purchasing of digital advertising.

Alma Media's extensive development of online and mobile content allows it to further improve its services to customers across the digital channels of its newspapers. The increase in Kauppalehti's digital content sales exceeded the fall in print media content sales in the third quarter. Kauppalehti's digital content revenue increased by 22.1% in the third quarter, while online advertising sales grew by 25.7% year-on-year.

Mobile services have grown in popularity across all Alma Media services. The number of visitors to the Iltalehti mobile site has grown fourfold since the beginning of the year. In response to the mobilisation of media, the company is actively developing a variety of mobile advertising solutions and applications for readers.

In the third quarter, the production reliability of Alma Media's new printing facility was brought under control. An agreement confirming that the printing of Hämeen Sanomat will be moved to the printing facility in Tampere from 1 January 2014 onwards was signed in September.

Alma Media will continue to focus on growing its digital services and digital expertise to ensure its continued capacity to effectively respond to changes in consumer behaviour and the ongoing transformational changes in the media industry.

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 2013. 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 Friday 25 October 2013 at 11.00-12.00 EEST in the Alma House (address: Alvar Aallon katu 3 C, Helsinki). Alma Media's result will be presented by President & CEO Kai Telanne and CFO Juha Nuutinen. Please note that the conference will be held in Finnish. The presentation material 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.

A conference call and audio webcast concerning the financial result of January-September 2013 will begin at 13.00 EEST. The conference call and audio webcast will be held in English. You can participate in the conference by calling +44(0)20 3427 1909 (confirmation code: 1913710) or follow the direct transmission at www.almamedia.com/press_room/downloads/presentations/.

ALMA MEDIA CORPORATION
Rauno Heinonen
Vice President, Corporate Communications and IR

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 approximately 1,900 professionals (without distributors), of which over 20% work outside Finland. Alma Media's revenue in 2012 totalled approximately MEUR 320. Alma Media's share is listed in the NASDAQ OMX Helsinki. Read more at www.almamedia.com.

  • Date: 25.10.2013, 11:00
  • News type: Stock exchange release

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