ALMA MEDIA CORPORATION STOCK EXCHANGE RELEASE 30 APRIL 2008 AT
09:00 (EET)
ALMA MEDIA CORPORATION'S INTERIM REPORT FOR JANUARY-MARCH 2008:
Net sales grew, operating profit expectedly below the strong level of
the comparable period
First quarter 2008 highlights:
- Net sales MEUR 84.0 (Q1/2007: MEUR 81.9)
- Operating profit MEUR 11.6, 13.8 % of net sales (MEUR 16.0)
- The operating profit for Q1/2007 includes one-time items of MEUR
1.9
- Profit before tax MEUR 12.9 (MEUR 17.2)
- Earnings per share EUR 0.13 (EUR 0.17)
- Prospects for remainder of year are unchanged
President and CEO Kai Telanne:
"During the first quarter of 2008 Alma Media's net sales developed
favourably. The general election in the period for comparison had a
smaller impact than expected on the growth figures for newspapers,
thanks to the encouraging media sales by the major regional
newspapers. In contrast, the absence of election advertising was
clearly visible in the media sales figures for local newspapers.
The operating profit fell below that for the previous year, mainly
due to the weaker result of Iltalehti and the investments made by
Marketplaces to expand operations in Finland and abroad.
The decline in the total market for daily tabloids continued during
the first quarter. Although Iltalehti again raised its share of the
market, the overall market trend significantly weakened its
circulation sales and profitability. The result also reflects the
stagnant media sales and the investments made in content.
The circulation copies, circulation sales and advertising sales of
Kauppalehti all increased well and profitability improved. The number
of visitors to Kauppalehti's online services, as well as net sales
and result for these services grew strongly during the first quarter.
Marketplaces continued to grow. Monster.fi and Etuovi.com were the
Finnish business units whose net sales rose fastest. The slowdown in
real estate business in several City 24 countries is reflected in
slower growth in these services. Investments to expand operations
weakened the result as expected. In line with our strategy, we are
continuing to expand our operations especially in Eastern Central
Europe and in Russia."
Further information:
President and CEO Kai Telanne, tel. +358 10 665 3500
CFO Teemu Kangas-Kärki, tel. +358 10 665 2244
Conference, webcast and conference call:
The company will hold a conference in Finnish concerning its
first-quarter results starting at 11.00 am on 30 April 2008 in the
Carl cabinet of the Scandic Marski hotel at Mannerheimintie 10,
Helsinki. The results will be presented by President and CEO Kai
Telanne and CFO Teemu Kangas-Kärki.
A webcast in English will start at www.almamedia.fi at 1.00 pm (EET).
A conference call for investors and analysts will start at 1.30 pm
(EET). To participate, please call +44 (0)20 7162 0025.
Rauno Heinonen
VP, Corporation Communications and IR
Alma Media Corporation
DISTRIBUTION:
Helsinki Stock Exchange
Principal media
ALMA MEDIA GROUP'S INTERIM REPORT JANUARY - MARCH 2008
The descriptive part of this interim report concentrates on the
Group's performance between January and March 2008. Figures in
brackets refer to the first quarter of 2007 unless otherwise stated.
The figures in the tables are independently rounded.
CHANGES IN GROUP STRUCTURE COMPARED TO 2007
On 20 February 2008 Alma Media purchased the share stock of Jadecon
Oy. The company's business comprises the TV programme information
internet service Telkku.com and it is reported as part of Iltalehti
in the Newspapers segment.
GROUP NET SALES AND RESULT JANUARY-MARCH 2008
Consolidated net sales in the review period increased 2.6% from the
corresponding period in the previous year to MEUR 84.0 (MEUR 81.9).
The growth in net sales slowed down as forecast, since the period for
comparison included advertising for the general election held in
March 2007 (MEUR 1.5). Net sales for the Newspapers segment remained
virtually unchanged from the corresponding period in the previous
year, whereas Kauppalehti Group and the Marketplaces segment
increased their net sales. In total, 13.3% of the Group's net sales
came from online operations.
The consolidated operating profit was MEUR 11.6 (MEUR 16.0). The
operating profit for the comparable period includes a one-time item
of a capital gain of MEUR 1.9. The weakened result of Iltalehti and
the investments by Marketplaces in expanding operations in Finland
and abroad burdened the Group's profitability.
PROSPECTS FOR 2008
Alma Media repeats its estimate that the company expects its net
sales to increase from the previous year. The media market is
expected to grow in 2008, but uncertainty will increase. Developments
in the media advertising and daily tabloid markets will be the major
factors for the company's result.
Alma Media estimates that the comparable operating profit for the
full year should be at the level of the previous year. However, the
operating profit at the beginning of the year may fall short of the
previous year's figure. One-time items have been eliminated from the
comparable 2007 operating profit.
MARKET CONDITIONS
The crisis in the financial markets and the fading of economic growth
in the USA increase uncertainty in Finland's economy.
The growth in Finland's gross national product is expected to slow
down and, according to different forecasts, to be on average 2.7 % in
2008, as the growth in private consumption, investments and exports
declines. The level of debt of households is expected to depress
consumption, as a greater share of income goes on loan costs. Rising
prices are also slowing down growth in consumption.
The growth in media advertising slowed down during the first quarter
of 2008. According to TNS Gallup, expenditure on media advertising
was 1.8% higher in January-March 2008 than in the corresponding
period in the previous year. Advertising declined in printed
newspapers by -1.4%, but grew in television (+6.0%) and online media
(+30.4%). According to TNS Gallup, the sectors that particularly
increased their media advertising were retail (+15.4%), jobs
(+10.9%), travel and transport (+6.7%) and food (+5.5%). Classified
advertising increased 4.1% in January-March and services advertising
declined -10.1%.
The general election held in March 2007 and Easter being in March in
2008 affect the changes in media advertising.
KEY FIGURES, 2008 2007 2007
MEUR 1-3 1-3 1-12
Net sales 84.0 81.9 328.9
Operating profit 11.6 16.0 64.4
% of net sales 13.8 19.6 19.6
Net financial expenses -0.3 0.0 -0.1
Net financial expenses, % of net sales -0.3 0.0 0.0
Share of associated companies' results 1.0 1.1 3.5
Balance sheet total 180.9 186.9 181.3
Gross capital expenditure 6.2 1.8 12.1
Gross capital expenditure, % of net sales 7.4 2.1 3.7
Equity ratio 39.5 49.5 69.8
Gearing, % 42.6 16.4 -15.2
Interest-bearing net debt 25.8 13.1 -17.9
Interest-bearing liabilities 41.6 23.6 6.8
Non-interest-bearing liabilities 78.6 83.4 56.2
Average no. of personnel,
calculated as full-time
employees, excl. delivery staff 1,932 1,942 1,971
Average no. of delivery staff 937 931 962
Earnings/share, EUR
(basic) 0.13 0.17 0.68
Earnings/share, EUR
(diluted) 0.13 0.17 0.68
Cash flow from operating activities, EUR 0.36 0.37 0.70
Shareholders' equity/share, EUR 0.80 1.07 1.58
Market capitalization 634.2 690.2 870.7
Average no. of shares (1,000 shares)
- basic 74,613 74,613 74,613
- diluted 74,825 74,616 74,773
No. of shares at end of period
(1,000 shares) 74,613 74,613 74,613
2008 2007 2007
NET SALES BY SEGMENT, MEUR 1-3 1-3 1-12
Newspapers 57.3 57.5 230.6
Kauppalehti group 18.5 17.7 70.1
Marketplaces 9.1 7.4 30.9
Other operations and eliminations -0.9 -0.7 -2.7
Total 84.0 81.9 328.9
2008 2007 2007
OPERATING PROFIT/LOSS BY SEGMENT, MEUR 1-3 1-3 1-12
Newspapers 9.3 11.5 42.8
Kauppalehti group 2.0 1.5 7.6
Marketplaces 1.1 1.6 5.3
Other operations and eliminations -0.8 1.5 8.7
Total 11.6 16.0 64.4
NEWSPAPERS
Newspapers, key figures, MEUR 2008 2007 2007
1-3 1-3 1-12
Net sales 57.3 57.5 230.6
Circulation sales 26.4 26.4 106.9
Media advertising sales 28.5 28.2 112.6
Printing sales 1.1 1.6 5.4
Other sales 1.4 1.3 5.7
Operating profit 9.3 11.5 42.8
Operating margin, % 16.3 20.0 18.5
Gross capital expenditure 1.2 1.0 6.0
Average no. of personnel,
calculated as full-time
employees, excl. delivery staff 1,167 1,186 1,218
Average no. of delivery staff 937 931 962
The Newspapers segment reports the publishing activities of 34
newspapers. The largest of these are the regional paper Aamulehti and
the daily tabloid Iltalehti.
The Newspapers segment's net sales in January-March were almost the
same as in the period for comparison, MEUR 57.3 (MEUR 57.5). There
were considerable differences between the net sales performance of
individual newspapers. Net sales in the comparable period were high
due to advertising for the general election.
The impact of the elections on the growth figures for newspapers was
smaller than expected thanks to the encouraging media sales of
Aamulehti, Satakunnan Kansa and Lapin Kansa. The absence of election
advertising in the media sales of local newspapers was clearly
visible. Iltalehti's media sales were considerably down on the period
for comparison.
Circulation sales remained at last year's level. The increase in
subscription prices for the regional newspapers compensated for the
effect of Iltalehti's lower circulation sales. The total daily
tabloid market declined 5% during the first quarter of 2008.
The major investments in newspaper online services continued, which
resulted in growth in the number of visitors. The Iltalehti.fi
service had on average 1.3 million unique visitors a week during the
first quarter of 2008. Aamulehti.fi doubled its weekly number of
visitors (at its highest 166,000 unique visitors).
The first quarter operating profit of the Newspapers segment declined
19.0% from the previous year to MEUR 9.3 (MEUR 11.5). The decline was
due in particular to the lower profit from Iltalehti and the local
newspapers.
KAUPPALEHTI GROUP
Kauppalehti group, key figures, MEUR 2008 2007 2007
1-3 1-3 1-12
Net sales 18.5 17.7 70.1
Circulation sales 6.2 6.0 24.4
Media advertising sales 5.8 5.4 21.5
Other sales 6.5 6.3 24.3
Operating profit 2.0 1.5 7.6
Operating margin, % 10.6 8.2 10.8
Gross capital expenditure 0.4 0.4 1.1
Average no. of personnel,
calculated as full-time employees 497 540 527
The Kauppalehti Group specializes in producing business and financial
information. Its best known title is Finland's leading business media
Kauppalehti. The group also includes Alma Media Lehdentekijät
(contract publishing), Kauppalehti 121 (direct marketing) and the BNS
news agency operating in the Baltic countries.
The Kauppalehti Group's net sales in the first quarter grew 4.5% to
MEUR 18.5 (MEUR 17.7). Kauppalehti's media sales in both the printed
newspaper and the online services developed very positively. Flat
media sales by Lehdentekijät and Kauppalehti 121 at the start of the
year depressed the net sales of the whole group.
The Kauppalehti Group's first quarter operating profit improved 33.9
%, thanks to higher net sales and cost savings and amounted to MEUR
2.0 (MEUR 1.5). The decline in profitability of Kauppalehti 121 and
Lehdentekijät weakened the result.
Kauppalehti.fi underwent a successful revamp in January. The number
of visitors to the online service have almost doubled since the first
quarter of 2007, at their highest being more than 400,000 unique
visitors a week.
MARKETPLACES
Marketplaces, key figures, MEUR 2008 2007 2007
1-3 1-3 1-12
Net sales 9.1 7.4 30.9
Operations in Finland 7.6 6.1 25.2
Operations outside Finland 1.5 1.3 5.7
Operating profit 1.1 1.6 5.3
Operating margin, % 12.5 21.6 17.3
Gross capital expenditure 0.3 0.1 2.8
Average no. of personnel, 199 146 158
calculated as full-time employees
The Marketplaces segment reports Alma Media's classified services,
which are produced on the internet and supported by printed products.
The services in Finland are Etuovi.com, Monster.fi, Autotalli.com,
Mascus.fi and Mikko.fi. The services outside Finland are City 24,
Motors 24, Mascus, Bovision and Objektvision.
The net sales of Marketplaces increased 23.1% to MEUR 9.1 (MEUR 7.4).
The activity of the recruitment market and continuing brisk real
estate business in Finland boosted the net sales of Monster.fi and
Etuovi.com. Although property sales slowed down in the Baltic
countries, the City24 units in the region recorded further
significant increases in their sales.
The segment's operating profit declined from the period for
comparison by 31.2% to MEUR 1.1 (MEUR 1.6). The Mikko.fi service
launched in Finland in September 2007 and starting up the new units
opened during 2007 for new market areas in Eastern Europe weakened
the result for the review period as expected.
ASSOCIATED COMPANIES
Share of associated companies' results, MEUR 2008 2007 2007
1-3 1-3 1-12
Newspapers 0.0 0.0 0.1
Kauppalehti group
Talentum Oyj 0.7 0.9 2.6
Other associated companies 0.0 0.0 0.0
Marketplaces
Other operations 0.0 0.1 0.1
Acta Print Kivenlahti Oy 0.2 0.2 0.7
Other associated companies 1.0 1.1 3.5
The Group holds a 29.9% stake in Talentum Oyj, which is reported
under the Kauppalehti Group. The company's own shares held by
Talentum are here included in the total number of shares. The holding
in Talentum has been incorporated in the Alma Media consolidated
financial statements such that Talentum's own shares are not included
in the total number of shares. The holding used in Alma Media's
consolidated financial statements on 31 March 2008 was 30.0%.
The Group's holding in Acta Print Kivenlahti Oy, reported under Other
Operations, is 36.0%.
BALANCE SHEET AND FINANCIAL POSITION
The Group's balance sheet totalled MEUR 180.9 at the end of March
2008 (31 December 2007: MEUR 181.3). The equity ratio at the end of
March was 39.5% (31 December 2007: 69.8%) and the company's equity
per share was EUR 0.80 (31 December 2007: EUR 1.58).
Alma Media Corporation's Annual General Meeting, held on 12 March
2008, decided to pay a dividend of EUR 0.90 per share. The record
date for the dividend payment was 17 March and the payment date 27
March. The company paid a total dividend of MEUR 67.2 to its
shareholders in March.
The Group has a current MEUR 100 commercial paper programme in
Finland, under which it is permitted to issue papers to a total
amount of MEUR 0-100. In March the Group issued papers for a total of
MEUR 35.0. On 31 March 2008 MEUR 65.0 of the commercial paper
programme was unused.
The Group's interest-bearing debt is denominated in euros and
therefore does not require hedging against exchange rate differences.
The most significant purchasing contracts denominated in foreign
currency are hedged.
The consolidated cash flow from operations was MEUR 1.1 below that
for the period for comparison, amounting to MEUR 26.8. The cash flow
before financing was MEUR 24.0 (MEUR 30.1). Factors affecting the
cash flow from investments were the purchase of Jadecon Oy in early
2008 and the capital gains from the sale of property in the previous
year.
CAPITAL EXPENDITURE
Alma Media Group's capital expenditure in the January-March period
totalled MEUR 6.2 (MEUR 1.8). At the start of 2008 the Group acquired
the share stock of Jadecon Oy. Otherwise the expenditure comprised
normal maintenance and replacement investments.
RISKS AND RISK MANAGEMENT
The most important strategic risks contingent on Alma Media's
business operations are a significant drop in the readerships of its
newspapers and a critical decline in retail advertising. The major
operational risks are disturbances in information technology systems
and telecommunications, and an interruption of printing operations.
Alma Media's risk management process identifies the risks, develops
appropriate risk management methods and regularly reports on risk
issues to the risk management function.
ADMINISTRATION
Alma Media Corporation's Annual General Meeting, held on 12 March
2008, elected the following to the Board of Directors: Lauri Helve,
Matti Kavetvuo, Kai Seikku, Kari Stadigh, Harri Suutari, Ahti
Vilppula and Erkki Solja.
At its constitutive meeting held after the Annual General Meeting,
the Board appointed Kari Stadigh as its chairman and Matti Kavetvuo
as deputy chairman. The Board also elected members for its
committees. Kai Seikku, Erkki Solja and Harri Suutari were elected to
the Audit Committee. In accordance with the Board's charter, chairman
of the Board Kari Stadigh and deputy chairman Matti Kavetvuo continue
as members of the Nomination and Compensation Committee.
The meeting appointed Ernst & Young Oy as the company's auditor.
THE ALMA MEDIA SHARE
Altogether 47,932,624 Alma Media shares were traded on the Helsinki
Exchanges during January-March 2008, which represented 64.2% of the
total number of shares. The closing price for the share on 31 March
2008 was EUR 8.50. The lowest quotation during the period was EUR
8.15 and the highest EUR 11.70. The market capitalization of Alma
Media Corporation at the end of March was MEUR 634.2.
The company does not own any of its own shares and does not have a
current authorization to purchase its own shares on the market.
Option rights
The annual general meeting on 8 March 2006 approved a three-stage
option programme (option rights 2006A, 2006B and 2006C), disapplying
the pre-emptive subscription right of the shareholders, under which
stock options would be granted to the managements of Alma Media
Corporation and its subsidiaries as a scheme for ensuring personnel's
motivation and long-term commitment to the company. Altogether
1,920,000 stock options may be granted in three lots of 640,000 each,
and these may be exercised to subscribe for at most 1,920,000 Alma
Media shares.
A total of 515,000 of the 2006A options have been issued to Group
management. Altogether 75,000 of the 2006A options have been returned
to the company owing to the termination of employment contracts.
Following the return of these options, Group management hold
altogether 440,000 2006A options.
In 2007 Alma Media Corporation's Board of Directors decided to cancel
the 190,000 2006A option rights in the company's possession. On 31
March 2008 the company still held 10,000 2006A option rights. These
will not be used for share subscriptions. Trading in the option
rights in the 2006A programme started on the OMX Nordic Exchange
(Helsinki) on 10 April 2008.
In 2007, Alma Media Corporation's Board of Directors decided to issue
515,000 options under the 2006B scheme to Group management.
If all the subscription rights are exercised, this programme will
dilute the holdings of the earlier shareholders by 2.3%.
The share subscription periods and prices under the scheme are:
2006A: 1 April 2008 - 30 April 2010, average trade-weighted price 1
April - 31 May 2006
2006B: 1 April 2009 - 30 April 2011, average trade-weighted price 1
April - 31 May 2007
2006C: 1 April 2010 - 30 April 2012, average trade-weighted price 1
April - 31 May 2008
The subscription price of shares that may be subscribed under these
stock option rights will be reduced by the amount of dividends and
capital repayments decided after the start of the period determining
the subscription price and before the subscription of shares, on the
settlement date for each dividend payment or capital repayment. The
share subscription price under the 2006A option was EUR 5.58 per
share and the subscription price under the 2006B option was EUR 8.95
correspondingly.
The Board of Directors has no other current authorizations to raise
convertible loans and/or to raise the share capital through a rights
issue.
Market liquidity guarantee
Alma Media Corporation and eQ Pankki Oy have made a liquidity
providing contract under which eQ Pankki Oy guarantees bid and ask
prices for the shares with a maximum spread of 3% during 85% of the
exchange's trading hours. The contract applies to a minimum of 2,000
shares.
Flagging notices
Between January and March 2008 Alma Media received the following
notices concerning changes in share holdings, under Chapter 2,
Section 9 of the Securities Market Act:
26 March 2008 Helsingin Mekaanikontalo Oy announced that it had
received a unilateral commitment on the basis of which Kai Mäkelä or
his nominee will purchase forward contracts relating to 5,000,000
Alma Media shares from Helsingin Mekaanikontalo Oy. If this agreement
is carried out, the (potential) holding of Helsingin Mekaanikontalo
in Alma Media will fall below 1/20th.
14 March 2008 Helsingin Mekaanikontalo announced that it had sold
forward contracts relating to Alma Media shares and that its
remaining holding consists of 50,000 forward contracts that mature in
March 2008. If the forward contracts are converted into Alma Media
shares, Helsingin Mekaanikontalo's holding will fall to 6.70%.
14 March 2008 Nordea Group's total holding in Alma Media Corporation
fell to 2.17% due to share transactions.
14 March 2008 Ilkka-Yhtymä Oyj announced that its holding had risen
above 1/10th.
3 March 2008 The total holding in Alma Media of Nordea Bank Suomi Oyj
and Nordea Group fell below 1/10th due to share transactions.
29 February 2008 Helsingin Mekaanikontalo announced that it had
extended the forward contracts it held and that the company held
95,565 forward contracts. If the forward contracts are converted into
Alma Media shares, Helsingin Mekaanikontalo's holding will be 12.81%.
Procomex SA, Helsingin Mekaanikontalo Oy and Ahti Vilppula will have
a combined holding of 12.84%, if the forward contracts are converted
into shares.
28 February 2008 Danske Bank A/S Helsinki Branch announced that its
holding had risen above the 1/20th limit (6.41%) as the result of
share transactions.
18 February 2008 Nordea Bank AB (publ) announced that its holding had
not changed as had been stated in the bank's announcement on 21
January 2008. According to this latest announcement the total holding
of Nordea Group had fallen below 3/20ths (13.35%).
21 January 2008 Oy Herttaässä Ab announced that its holding had risen
above 1/5th (20.68%) after making forward contracts.
21 January 2008 Nordea Bank AB (publ) announced that its holding had
not changed as had been stated in the bank's announcement on 28
December 2007. According to this latest announcement the total
holding of Nordea Group exceeds 3/20ths (17.50%).
2 January 2008 Nordea Bank AB (publ) announced that its holding had
not changed as had been stated in the bank's announcement on 1
October 2007. According to this latest announcement the total holding
of Nordea Group exceeds 3/20ths (16.84%).
SUMMARY OF FINANCIAL STATEMENTS AND NOTES
2008 2007 2007
INCOME STATEMENT, MEUR 1-3 1-3 1-12
NET SALES 84.0 81.9 328.9
Other operating income 0.1 2.1 13.0
Materials and services -25.1 -24.2 -99.1
Costs arising from employment benefits -29.3 -28.0 -111.7
Depreciation and writedowns -2.2 -2.3 -9.8
Operating expenses -15.9 -13.4 -56.8
OPERATING PROFIT 11.6 16.0 64.4
Financial income 0.6 0.4 1.2
Financial expenses -0.3 -0.4 -1.1
Share of associated companies' results 1.0 1.1 3.5
PROFIT BEFORE TAX 12.9 17.2 68.0
Income tax -3.2 -4.1 -16.8
PROFIT FOR THE PERIOD 9.7 13.1 51.2
Distribution:
To the parent company shareholders 9.4 12.9 50.5
Minority interest 0.3 0.2 0.6
Earnings/share, EUR 0.13 0.17 0.68
Earnings/share (diluted), EUR 0.13 0.17 0.68
BALANCE SHEET, MEUR 31.3.2008 31.3.2007 31.12.2007
ASSETS
NON-CURRENT ASSETS
Goodwill 32.8 30.0 29.7
Intangible assets 11.4 9.5 10.2
Tangible assets 37.7 51.0 38.4
Investments in associated companies 34.7 33.3 34.1
Other long-term investments 3.9 3.9 4.0
Deferred tax assets 1.0 3.9 1.0
Other receivables 0.0 0.2 0.0
CURRENT ASSETS
Inventories 1.2 1.7 1.4
Tax receivables 0.1 0.7 0.0
Accounts receivable and other
receivables 34.6 35.1 29.9
Other short-term investments 3.1 2.4 3.0
Cash and cash equivalents 15.7 10.5 24.8
ASSETS AVAILABLE FOR SALE 4.7 4.7 4.7
TOTAL ASSETS 180.9 186.9 181.3
BALANCE SHEET, MEUR 31.3.2008 31.3.2007 31.12.2007
SHAREHOLDERS' EQUITY AND LIABILITIES
Share capital 44.8 44.8 44.8
Share premium fund 2.8 2.8 2.8
Cumulative translation adjustment 0.0 0.1 0.0
Retained earnings 12.2 31.9 70.0
Parent company shareholders' equity 59.8 79.6 117.7
Minority interest 0.9 0.2 0.6
TOTAL SHAREHOLDERS' EQUITY 60.7 79.8 118.3
LIABILITIES
Non-current liabilities
Interest-bearing liabilities 4.4 18.8 4.6
Deferred tax liabilities 2.2 1.6 1.8
Pension obligations 3.6 3.7 3.7
Provisions 0.1 0.1 0.1
Other long-term liabilities 0.4 7.1 0.9
Current liabilities
Interest-bearing liabilities 37.2 4.8 2.2
Advances received 27.0 25.6 12.0
Tax liabilities 1.6 3.9 1.1
Provisions 0.2 2.0 0.3
Accounts payable and other
liabilities 43.4 39.6 36.4
TOTAL LIABILITIES 120.2 107.1 63.0
TOTAL EQUITY AND LIABILITIES 180.9 186.9 181.3
RECONCILIATION OF SHAREHOLDERS' EQUITY 1 JAN. - 31 MARCH 2008
Share Parent
Share premium Retained company, Minority Equity,
MEUR capital fund earnings total interest total
Equity, 1 Jan. 44.8 2.8 70.0 117.7 0.6 118.3
2008
Translation
differences 0.0 0.0 0.0
Share of items
recognized
directly in
associated
company's equity -0.3 -0.3 -0.3
Income recognized
directly in equity -0.3 -0.3 -0.3
Profit for the
period 9.4 9.4 0.3 9.7
Net income for the
period 9.1 9.1 0.3 9.4
Share-based
payments 0.2 0.2 0.2
Dividend paid by
parent company -67.2 -67.2 -67.2
Equity, 31 March 44.8 2.8 12.2 59.8 0.9 60.7
2008
RECONCILIATION OF SHAREHOLDERS' EQUITY 1 JAN. - 31 MARCH 2007
Share Parent
Share premium Retained company, Minority Equity,
MEUR capital fund earnings total interest total
Equity, 1 Jan.
2007 44.8 2.8 67.3 114.9 0.4 115.3
Translation
differences 0.0 0.0 0.0
Share of items
recognized
directly in
associated
company's equity 0.2 0.2 0.2
Income
recognized
directly in
equity 0.2 0.2 0.2
Profit for the
period 12.9 12.9 0.2 13.1
Net income for
the period 13.1 13.1 0.2 13.3
Share-based
payments 0.1 0.1 0.1
Dividend paid
by parent
company -48.5 -48.5 -48.5
Dividends paid -0.4 -0.4
by subsidiaries
Equity, 31 March 44.8 2.8 31.9 79.6 0.2 79.8
2007
2008 2007 2007
CASH FLOW STATEMENT, MEUR 1-3 1-3 1-12
Cash flow from operating activities
Profit for the period 9.7 13.1 51.2
Adjustments 3.9 3.1 8.8
Change in working capital 15.4 14.0 3.4
Dividend income received 0.2 0.0 3.2
Interest income received 0.4 0.4 1.1
Interest expenses paid -0.3 -0.3 -1.1
Taxes paid -2.5 -2.3 -14.1
Net cash provided by operating activities 26.8 27.9 52.5
Cash flow from investing activities
Investments in tangible and intangible assets -0.9 -0.9 -5.6
Proceeds from disposal of tangible and intangible
assets 0.0 0.0 1.5
Other investments 0.0 0.0 -1.0
Proceeds from disposal of other investments 0.1 3.2 3.4
Subsidiary shares purchased -2.0 -0.2 -0.3
Associated company shares purchased 0.0 0.0 -1.5
Net cash used in investing activities -2.8 2.1 -3.5
Cash flow before financing activities 24.0 30.1 49.1
Cash flow from financing activities
Long-term loan repayments 0.0 0.0 0.0
Short-term loans raised 35.0 2.0 2.0
Short-term loans repaid -0.6 -0.8 -5.2
Change in interest-bearing receivables -0.2 -0.2 -0.5
Dividends paid and capital repayment -67.2 -48.8 -48.8
-33.0 -47.8 -52.5
Change in cash funds (increase + / decrease -) -9.0 -17.7 -3.4
Cash and cash equivalents at start of period 24.8 28.2 28.2
Cash and cash equivalents at end of period 15.7 10.5 24.8
BUSINESS ACQUISITIONS JANUARY-MARCH 2008
On 20 February 2008 Alma Media acquired the entire share stock of
Jadecon Oy. The company's business comprises the TV programme
information internet service Telkku.com and it is reported in the
Newspapers segment as part of Iltalehti.
The fair values for intangible assets recorded in combining Jadecon
Oy are mainly related to brands, the acquired IT application and
customer contracts. The anticipated synergies between Iltalehti and
the acquired business contributed to the goodwill arising from the
acquisition. The operating profit for the purchased business since
the acquisition date has been MEUR 0.1. The Group's first quarter net
sales would have been an estimated MEUR 84.3 and operating profit
MEUR 11.7 if the acquisition had taken place at the start of 2008.
INFORMATION BY SEGMENT
Alma Media's reporting segments in the financial statements are
Newspapers, Kauppalehti Group and Marketplaces. Other Operations
comprises Alma Media Group's parent company and the operations of the
Group's financial management service centre.
The descriptive section of this bulletin presents the net sales and
operating profits of the segments and the allocation of the
associated companies' results to the reporting segments. Financial
items and income taxes are not allocated to the segments. The
following table presents the assets and liabilities of the segments
as well as the non-allocated asset and liability items.
ASSETS BY SEGMENT, MEUR 31.3.2008 31.3.2007 31.12.2007
Newspapers 69.6 69.5 64.7
Kauppalehti group 58.4 59.6 56.5
Marketplaces 16.8 14.3 15.4
Other operations and eliminations 19.2 28.5 19.0
Non-allocated assets 16.9 15.0 25.7
Total 180.9 186.9 181.3
LIABILITIES BY SEGMENT, MEUR 31.3.2008 31.3.2007 31.12.2007
Newspapers 45.4 43.6 31.4
Kauppalehti group 15.3 16.6 12.6
Marketplaces 4.2 3.6 3.9
Other operations and eliminations 9.8 14.2 5.5
Non-allocated liabilities 45.5 29.1 9.7
Total 120.2 107.1 63.0
2008 2007 2007
GROUP INVESTMENTS, MEUR 1-3 1-3 1-12
Gross capital expenditure 6.2 1.8 12.1
PROVISIONS
The company's provisions at the end of March 2008 totalled MEUR 0.3.
The change from the situation on 31 December 2007 is a reduction of
MEUR 0.1. Most of the provisions are to cover restructuring measures.
It has not been necessary to change the estimates made when the
provision was entered. The change in provisions is in consequence of
actual costs.
COMMITMENTS AND CONTINGENCIES, MEUR 31.3.2008 31.3.2007 31.12.2007
Collateral on own behalf
Chattel mortgages 0.0 0.0 0.0
Collateral for others
Guarantees 0.0 0.0 0.0
Other commitments
Commitments based on agreements 0.1 0.1 0.1
Minimum rents payable based on other
lease agreements:
Within one year 7.6 6.3 7.5
Within 1-5 years 17.4 14.4 18.1
After 5 years 25.8 12.8 26.5
Total 50.7 33.5 52.1
The Group also has purchase agreements
based on IFRIC 4 which include a lease
component per IAS 17. Minimum payments
based on these agreements: 4.2 6.1 4.6
GROUP DERIVATIVE CONTRACTS, MEUR 31.3.2008 31.3.2007 31.12.2007
Commodity derivative contracts,
electricity derivatives
Fair value * 0.1 0.0 0.1
Nominal value 0.4 0.0 0.4
* The fair value represents the return that would have arisen if the
derivative positions had been cleared on the balance sheet date.
CONTINGENT LIABILITIES
The Group has contingent liabilities totalling MEUR 7.8. The tax
authorities have issued a claim to correct the company's income tax
for 2003. The tax authorities consider that the loss arising from
Alma Media's disposal of the shares of its associated company
Talentum to Kauppalehti Oy at the market price should not have been
tax-deductible. At the end of 2006 (20 December 2006) the company was
informed of a ruling by the Adjustments Board of the Corporate
Taxation Centre to the effect that the Adjustments Board rejected the
claim by the tax authorities. The tax authorities have appealed the
Adjustments Board's ruling to the Helsinki Administrative Court. The
company continues to believe that it is improbable that the claim
will lead to additional tax consequences since the transaction was
carried out at market prices for commercial reasons. The decision of
the Helsinki Administrative Court is expected during 2008
RELATED PARTIES
Alma Media Group's related parties are its associated companies and
the companies they own. The following table summarizes the operations
undertaken between Alma Media and its associated companies and the
status regarding their receivables and liabilities:
RELATED PARTY ACTIVITIES WITH ASSOCIATED COMPANIES, 2008 2007 2007
MEUR 1-3 1-3 1-12
Sales of goods and services 0.1 0.0 0.2
Purchases of goods and services 1.1 1.3 5.9
Accounts receivable, loan and other receivables at the 4.7 4.8
balance sheet date 4.7
Accounts payable at the balance sheet date 0.1 0.4 0.1
Related parties also include the company's senior management (Board
of Directors, presidents and the Group Executive Team). The section
Option Rights of this interim report presents information on changes
to the current option scheme intended to motivate and secure the
long-term commitment of the Group's senior management.
MAIN ACCOUNTING PRINCIPLES (IFRS)
This interim report has been prepared applying IFRS recognition and
measurement principles (IAS 34 - Interim Financial Reporting).
The interim report applies the same accounting principles and
calculation methods as in the previous annual accounts dated 31
December 2007. However, the interim report does not contain all the
information or notes to the accounts included in the annual report.
This interim report should therefore be read in conjunction with the
company's annual report for 2007.
The key indicators are calculated using the same formulae as applied
in the annual financial statements.
No new accounting standards or interpretations have been adopted
during 2008. The following new accounting principles and
interpretations will be applied from the beginning of 2009:
IFRS 8 Operating Standards
IAS 23 Borrowing Costs, amendment to standard
IAS 1 Presentation of Financial Statements, amendment to standard
IFRIC 13 Customer Loyalty Programmes
The Group has initially estimated that the new standards and
interpretations mentioned above will only have a small impact. It has
been initially estimated that their application will mainly affect
the presentation of the income statement, balance sheet and statement
of changes in shareholders' equity as well as the notes to the
financial statements.
A new accounting standard to be adopted from the beginning of 2010 is
IFRS 3, Business Combinations (amendment to standard). The changes to
IFRS 3 will affect the treatment of business acquisitions, concerning
for example minority interest, goodwill and expenses relating to the
acquisition. The amendment to IFRS 3 will not affect previous
business acquisitions.
The Group's long-term receivable from the associated company Acta
Print Kivenlahti Oy is shown in the balance sheet under assets
available for sale. Alma Media intends to relinquish its entire
holding in Acta Print Oy. This divestment is not expected to have a
significant impact on Alma Media's financial position.
The figures in this bulletin are unaudited.
SEASONALITY
The Group recognizes its circulation revenues as paid. For this
reason circulation revenues accrue in the income statement fairly
evenly during the four quarters of the year. The bulk of circulation
invoicing takes place at the beginning of the year and therefore cash
flow from operating activities is strongest early in the year. This
also affects the company's balance sheet position in different
quarters.
USE OF ESTIMATES
This bulletin contains certain statements that are estimates based on
management's best knowledge at the time they were made. For this
reason they
contain risks and uncertainty. The estimates could change in the
event of
significant changes in business conditions.
NEXT INTERIM REPORT
Alma Media publishes its results for the first six months of the year
at 9.00 am (EET) on 23 July 2008.
ALMA MEDIA CORPORATION
Board of Directors
Alma Media Corporation's Interim report for January-March 2008: Net sales grew, operating profit expectedly below the strong level of the comparable period
| Source: Alma Media
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