Alma Media’s Interim Report for January-June 2013: Non-recurring sales gains improved operating profit

Alma Media Corporation    Interim Report     July 19, 2013 at 9:00am (EEST)

Alma Media’s Interim Report for January-June 2013:
NON-RECURRING SALES GAINS IMPROVED OPERATING PROFIT

Financial performance in April-June 2013:

– Revenue MEUR 76.3 (81.0), down 5.8%. 
– Content revenue MEUR 28.2 (30.4), down 7.3%; advertising revenue MEUR 38.5 (41.5), down 7.3%; service revenue MEUR 9.7 (9.2), up 5.6%.
– EBITDA (Earnings before interests, taxes, depreciation and amortisation) excluding non-recurring items MEUR 8.0 (10.8), down 25.9%
– EBITDA MEUR 16.0 (7.7), up 106.3%.
– Operating profit excluding non-recurring items MEUR 4.6 (7.7), 6.0% (9.5%) of revenue, down 40.1%.
– Operating profit MEUR 9.5 (4.8), 12.4% (5.9%) of revenue, up 97.5%.
– Profit for the period MEUR 7.9 (4.5), up 78.1%.
– Earnings per share EUR 0.10 (0.06).

Financial performance in January-June 2013:

– Revenue MEUR 151.2 (162.2), down 6.8%. 
– Content revenue MEUR 57.4 (61.6), down 6.7%; advertising revenue MEUR 74.9 (82.5), down 9.3%; service revenue MEUR 19.0 (18.1), up 4.7%.
– EBITDA excluding non-recurring items MEUR 16.0 (22.4), down 28.6%
– EBITDA MEUR 23.9 (18.5), up 29.5%.
– Operating profit excluding non-recurring items MEUR 10.0 (16.1), 6.6% (9.9%) of revenue, down 37.7%.
– Operating profit MEUR 14.9 (10.8), 9.9% (6.7%) of revenue, up 38.1%.
– Profit for the period MEUR 12.0 (7.2), up 67.2%.
– Earnings per share EUR 0.15 (0.09).

Key figures

Outlook for 2013:

Economic growth in Europe, and in particular Finland, is expected to remain weak also in the second half 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 totally cover the decline in the sales of print media.

Alma Media expects the revenue and the operating profit excluding non-recurring items for the second half of 2013 and the full year to decline from 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:

As the general economy continued to weaken, the second quarter of 2013 was a difficult one for media companies. Media advertising in Finland decreased by 7.8% in the second quarter compared to the same period the year before. The single-copy and subscription sales of print newspapers were also in a clear decline.

Despite the difficult market situation, the Marketplaces unit, focusing on digital classified advertising services, continued its excellent performance in particular in its Eastern European operations. Alma Media’s earnings per share improved mainly due to the non-recurring gains from the sale of Mascus, the online marketplace for heavy machinery and equipment.

Alma Media’s growth strategy and development activities focus on digital products and services, whose share was 27.4% of Group revenue in the second quarter. Kauppalehti’s income from digital content grew by 27.2% from the comparison period. The development of digital services included expanded online visitor management and creating tools for targeted online advertising, visitor count measurement for online and mobile services, as well as analytics. In addition, Kauppalehti and Iltalehti developed applications that make it easier to follow the newsfeed on mobile devices.

Alma Media implemented a number of measures aimed at improving the competitiveness of its publishing operations in the second quarter. The subscription pricing of the company’s regional papers was clarified and some local papers implemented a paywall system for their online content. Alma Media aims at making the majority of its regional papers’ online content chargeable during this year. Aamulehti decided to change to the tabloid format in April 2014. Of Alma Media’s regional papers, Lapin Kansa, Pohjolan Sanomat, Kainuun Sanomat and Satakunnan Kansa have already adopted the tabloid format. A unified format for Alma Media’s regional papers will create operational benefits in content production while improving the reader experience through common material. Iltalehti implemented a major appearance and content modernisation aiming at even better service for readers.

Alma Manu’s new printing facility in Tampere began its commercial operation in April. The new facility is competitive also for printing non-Alma Media newspapers and will bring production yields to Alma Media’s  internal print jobs already in the end of this year.

In the second quarter, Alma Media divested some of its marketplaces outside of its core business. The company sold its used car portal service, Autovia.sk, in Slovakia as well as the online marketplace Mascus. In the future, Alma Media will focus on recruitment and home sales portals in its international marketplace business.

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 – June 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 19 July 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-June 2013 will begin at 12.30 EEST. The conference call and audio webcast will be held in English. You can participate in the conference by calling +44(0)20 3427 1918 (confirmation code: 9893768) 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.

• Alma Media’s Interim Report Q2 2013

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