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CEO’s Review

CEO’s review: Building growth in spite of headwinds (published 19 July 2023)

Alma Media’s business performance in the first half of the year was in line with expectations in spite of the slowing of economic growth and the disruptions caused by Russia’s war of aggression. Revenue decreased by 1.3% to MEUR 153.5 and adjusted operating profit decreased by 6.4% to MEUR 36.4. While our profitability has been slightly reduced by the decline in media advertising sales and rising costs, the effects of the measures we have taken to adapt costs and defend profitability will begin to show in the second half of the year.

In the second quarter, profit performance improved compared to the preceding quarter, and adjusted operating profit rose to the same level as in the comparison period. The ratio of operating profit to revenue rose to 24.8%, which is close to our long-term target level of 25%.

For the Alma Career segment, Q2 was the second-best on record in terms of both operating profit and profitability. Revenue was on a par with the comparison period at MEUR 28.4, while adjusted operating profit increased by 3.8% to MEUR 12.2, representing 43.1% of revenue. Adjusted total expenses decreased by 2.6%.

Sales of recruitment services remained at a good level in the Czech Republic, Slovakia and Croatia. The continued high level of activity in the recruitment market is driven by intense competition for skilled labour. The low unemployment rate in our key operating countries also boosts demand for our added-value services, for which revenue increased by 5.8%.

The Career United project, which seeks to deepen internal cooperation, continues to progress, which helps keep costs under control. System architecture, brand, finance and ICT harmonisation has progressed according to plan. The next step is to harmonise HR systems.

Customer invoicing decreased year-on-year, but we expect revenue in Q3 to be at least on a par with the comparison period. Market conditions are expected to remain challenging in the Baltic countries and particularly in Finland. The situation in the Czech Republic and Slovakia is better. In Croatia, tourism is driving high growth.

The Alma Consumer segment’s revenue decreased by 3.1% to MEUR 26.3 in Q2. Adjusted operating profit declined by 15.9% to MEUR 5.6, representing 21.2% of revenue. The share of digital business was 82.2% of total revenue. Revenue from comparison services and sharing economy services showed strong development, but revenue from media and media-related services decreased by 8.0%. The drop in advertising revenue can be considered significant (-10.1%), but advertising sales in June showed a substantial improvement compared to April–May. Among the business areas, revenue in the housing segment was particularly affected by the difficult market situation (a decline of 2.3%), but the automotive and mobility segment exceeded the comparison period’s level. Geopolitical tensions and war-related news kept the demand for news high, with the number of subscribers to the paid Iltalehti Plus service exceeding 47,300.

Baana, a digital used car auction service between consumers and car dealers launched earlier this year, is still in the launch stage, but it gained a more established position in the market during the period under review.

In spite of the market situation, we continued our purposeful investments particularly in sales system development in the automotive and housing segments, the OviPro system for digital real estate agency, system projects in the automotive and mobility segment, and development projects related to payment transactions and other key aspects of transactional commerce.

In the Alma Talent segment, the market situation in the second quarter remained challenging for financial media, with revenue declining by 2.9% to MEUR 23.4. The segment implemented cost saving measures across its business operations and costs turned to a decrease. Adjusted operating profit grew by 9.2% to MEUR 4.7. The segment’s strong digital transformation continued, with the share of digital business rising to 64.3% of revenue.

The operating profit of Talent Services increased by 55.1% to MEUR 2.2. At the same time, Talent Media’s operating profit declined by 17.3% to MEUR 2.1.

The increase of 17.7% in Alma Talent Services’ recurring revenues in areas such as business information and law-related services, and the positive development of business premises marketplaces in Finland and Sweden, demonstrates that the segment has successfully established a second cornerstone of growth in scalable digital services aimed at businesses. The April acquisition of a majority stake in the digital DOKS service (Suomen Tunnistetieto), which helps companies manage anti-money laundering obligations, monitor sanctions and, in general, identify and know their customers, is a logical direction of development.

Alma Media is in a good position

Our financial position is strong thanks to our strong profit performance and cash flow. Our gearing at the end of June stood at 82.4% (93.7%) and our equity ratio was 43.0% (38.8%).

Russia’s war of aggression against Ukraine slows economic growth in our operating countries. Nevertheless, our financial performance has been strong. The investments we have made in previous years – in marketplaces, for example – are now producing positive results.

We will continue to accelerate growth by continuously developing our operations and pursuing new initiatives. In the marketplace and service business, we are moving towards more advanced digital trading platforms and seamless purchasing paths. We want to help our customers easily and smoothly interact on digital platforms, and to offer them additional services at different stages of the transaction process.

Kai Telanne
President and CEO


“In the marketplace and service business, we are moving towards more advanced digital trading platforms and seamless purchasing paths”