CEO’s Review

CEO’s review 19 April 2024: Continued investments in a subdued operating environment

Alma Media’s business developed well in the first quarter in spite of the subdued operating environment. Revenue was on a par with the comparison period at MEUR 76.2. Revenue was supported by acquisitions, but the weakened exchange rate of the Czech koruna dampened revenue performance. Revenue from classified advertising increased year-on-year (+1.0%) in local currencies.

Revenue from advertising decreased by 6.4% to MEUR 14.7. Adjusted operating profit decreased by 5.2% to MEUR 16.1 and was 21.2% of revenue. Profitability was weighed down by investments in service development, particularly in housing-
related services in the Marketplaces segment, as well as increased ICT expenses.

This is the first report to use the segment structure and revised revenue distribution that took effect on 1 March 2024.

Our business segments are now Alma Career, Alma Marketplaces and Alma News Media.

In the Alma Career segment, revenue decreased by 2.7% and amounted to MEUR 26.9. Adjusted operating profit decreased by 5.8% to MEUR 10.4 and was 38.7% of revenue. Due to the Czech koruna having been exceptionally strong in the
comparison period, approximately MEUR 1 of the decrease in revenue was attributable to exchange rates.

There were significant differences in the labour market cycle between Alma Career’s operating countries. Among the significant operating countries, the situation was fairly good in the Czech Republic, and the dynamic recruitment markets in Slovakia and Croatia continued to be driven by the high level of activity among workers, intense competition for skilled labour and low unemployment. At the same time, the cyclical conditions remained very challenging in the Baltic countries and Finland.

The Alma Marketplaces segment’s revenue increased by 10.5% in the first quarter and amounted to MEUR 22.9. Adjusted operating profit decreased by 11.1% to MEUR 5.8 and was 25.5% of revenue. In the Insights business, growth of 22%
was achieved in continuously invoiced services. The negative impacts of the housing market have begun to have a delayed effect on the revenue of housing-related services.

The segment’s expenses increased by almost 20% due to acquisitions. In spite of the challenging market conditions, we continued to purposefully implement our development projects, particularly in digital services related to the automotive
and housing verticals, as well as other key projects related to transactional commerce.

In the Alma News Media segment, revenue decreased by 2.9% to MEUR 26.4, but adjusted operating profit increased by 11.2% to MEUR 2.6 in the first quarter. Active cost control measures led to expenses decreasing by 4.3% and adjusted
operating profit increasing to 9.7% (8.5%) of revenue.

The economic cycle is challenging for Finnish media, and there has been no recovery in spite of the temporary boost caused by the presidential elections.

Nevertheless, there was high general interest in the news. The development of targeted and personalised content saw the paid Iltalehti Plus service increase its number of subscribers to roughly 52,000. The strong digital transformation continued, with the share of digital business rising to over 56% of revenue. In direct marketing, strong growth was achieved in terms of both revenue and operating profit.

Alma Media is in a good position

We have a strong financial position. Our gearing at the end of the year stood at 59.8% and our equity ratio was 46.3%.

Our digital business models are cost-efficient and scalable, and they have enabled us to expand our role in our customers’ value chains in our key business areas.

The acquisition of Netwheels during the reporting period complements Alma Media’s automotive and mobility services for business customers. The acquisition will contribute to the development of the marketplace and systems business by
streamlining the purchase and sales processes of vehicles and by offering digital solutions to car retailers, importers, financing companies, application developers and other operators in the automotive sector.

With cooperation and unique competitive advantage we have created an entity which encompasses a culture of growth and strong expertise and at the same time serve as the foundation for future growth.

Kai Telanne
President and CEO

“With cooperation and unique competitive advantage we have created an entity which encompasses a culture of growth and strong expertise and at the same time serve as the foundation for future growth.“