TALENTUM OYJ INTERIM REPORT 27 April 2012 at 9:00
January-March 2012 in brief, continuing operations
- Talentum Group’s net sales came to EUR 20.5 million (EUR 21.5 million), a decrease of 4.5%.
- Talentum Group’s comparable net sales sales excluding Talentum HR AB were EUR 20.5 million (EUR 20.4 million), an increase of 0.5%.
- Operating income without non-recurring items was EUR 0.2 million (EUR 1.0 million).
- Operating income (EBIT) was EUR -2.6 million (EUR 1.0 million).
- The amount of advertising in Talentum’s media decreased by -13.0%
- Net liabilities were EUR -1.8 million (EUR -1.5 million on 31 December 2011).
- Talentum Group carried out a savings program during the first quarter.
Net sales by business area:
- Magazine Business Finland: EUR 7.5 million (EUR 7.5 million)
- Magazine Business Sweden: EUR 6.2 million (EUR 7.0 million)
- Events: EUR 3.2 million (EUR 2.4 million)
- Books and Legal Training: EUR 2.0 million (EUR 2.2 million)
- Direct Marketing: EUR 2.7 million (EUR 2.2 million)
KEY FINANCIAL FIGURES, CONTINUING OPERATIONS *)
| EUR million | 1-3/2012 | 1-3/2011 | 1-12/ 2011 |
| Net sales | 20.5 | 21.5 | 83.5 |
| Operating income without non-recurring items | 0.2 | 1.0 | 2.4 |
| Operating income | -2.6 | 1.0 | -0.7 |
| as % of net sales | -12.7 | 4.8 | -0.8 |
| Net cash from operating activities | 0.7 | 1.8 | 4.6 |
| Total assets | 61.9 | 68.0 | 57.3 |
| Investments | 0.2 | 0.2 | 1.4 |
| as % of net sales | 0.8 | 1.1 | 1.7 |
| Equity ratio % | 39.3 | 35.5 | 54.1 |
| Gearing ratio % (net debt to equity) | -10.6 | 58.6 | -6.7 |
| Interest-bearing liabilities | 1.8 | 12.3 | 1.2 |
| Net interest-bearing liabilities | -1.8 | 10.8 | -1.5 |
| Personnel on average | 771 | 734 | 754 |
| Earnings per share, EUR | -0.05 | 0.01 | -0.04 |
| Cash flow from operating activities per share, EUR | 0.02 | 0.04 | 0.11 |
| Equity per share, EUR | 0.40 | 0.42 | 0.50 |
*) These figures do not include the construction information business sold in August 2011, which is presented as discontinued operation. The figures include Talentum HR AB.
Reporting
Talentum's business operations are divided into six segments: Magazine Business Finland, Magazine Business Sweden, Event Business, Books and Legal Training, Direct Marketing, and Other Operations.
A separate stock exchange release was issued on 17 April 2012 regarding the change in the reporting segments.
CHIEF EXECUTIVE OFFICER AARNE AKTAN:
"In the first quarter, Talentum Group’s net sales totalled EUR 20.5 million, an increase of 0.5%. Talentum Group’s comparable net sales excluding Talentum HR AB were EUR 20.5 million (EUR 20.4 million), an increase of 0.5%.
Operating income for the first quarter was weighed down by non-recurring items resulting from personnel reduction measures, which were initiated in January 2012, as well as other expenses connected with the reorganisation. These measures yield the target savings of EUR 4.5 million on a yearly level.
Our operating income without non-recurring items was EUR 0.2 million. We are not satisfied with this result, but the efficiency enhancement measures will enable Talentum to improve its competitiveness and profitability.
Our operating income including non-recurring items was EUR -2.6 million.
Of the business segments, Events and Direct Marketing grew steadily.
Sweden's advertising market is unstable and sales of professional journals, in particular dropped close to 10 percent. The performance of the Magazine Business Sweden unit decreased more strongly than the advertising market in general.
The advertising market in Finland decreased by 1.4% during the first quarter compared with the corresponding quarter in 2011. Online advertising market in Finland grew by 13.7% in January-March from last year. Talentum’s print media sales in Finland developed weaker than the markets in general. Especially recruitment advertising decreased in unstable economic situation compared with the corresponding quarter last year. Talentum’s online sales grew at the same pace with general online advertising sales.
Circulation revenue in Finland grew during the first quarter despite the fact that Finnish Government decided to raise the VAT on subscription magazines to 9 percent effective January 1, 2012. Also the group subscription agreement with Union of Professional Engineers in Finland (UIL) was terminated at the end of 2011. We were able to compensate the lost subscriptions better than expected by determined input into sales. Our circulation sales organization gave a very good input into this.
Our key goal in 2012 is to increase profitability, and we are now working in a determined way with the help of a restructured organisation and competent personnel.”
Operating environment and seasonal variation
In the period from January to March, general economic uncertainty has continued in both Finland and Sweden, which may have a weakening effect on the operating environment in the near future.
According to TNS Media Intelligence, spending on advertising for January-February grew by 1.4% in Finland. Growth excluding advertising connected with the presidential election was 1.3%. In periodicals, advertising decreased by
-1.7%. Advertising in professional and organizational journals decreased by
-7.0%. Online advertising revenues increased by 13.7%. In Sweden, total media advertising rose by 9.3% in the first quarter, while in professional journals there was a decrease of -9.7% (Sweden’s Media Agencies - Sveriges Mediebyråer).
The media and advertising markets are subject to seasonal variations. Talentum’s magazines and books do not generally come out during the summer holiday season, which is why the third quarter is the weakest in terms of sales. Profit for the third period is almost always negative. Operations are generally at their busiest in the final quarter.
Sector and Talentum prospects for 2012
The company estimates that moderate economic growth in the company's main markets of Finland and Sweden will support moderate growth in advertising in 2012.
Talentum estimates that, in 2012, its comparable net sales (2011: excluding Talentum HR AB sold at the end of the year, about EUR 79 million) will remain at the same level and that operating income without non-recurring items will increase compared to 2011.
This interim report is unaudited.
General statement
The forecasts and estimates presented here are based on the management’s current view of economic development, and the actual results may differ substantially from what is now expected of the company.
Next interim report
Talentum Oyj will publish its interim report for the second quarter of 2012 on 20 July 2012.
TALENTUM OYJ
Board of Directors
ADDITIONAL INFORMATION
CEO, Aarne Aktan, tel. +358 40 342 4440 and CFO, Niclas Köhler,
tel. +358 40 342 4420.
DISTRIBUTION
NASDAQ OMX Helsinki
Principal media
www.talentum.com
ENCLOSURE: Talentum Group Q1/2012 interim report
BRIEFING
A briefing in Finnish will be held for analysts and the media today, 27 April 2012 at 10:30 at the Talentum head office, Annankatu 34-36 B, Kamppi, Helsinki, Finland. The interim statements will be presented by Aarne Aktan, Chief Executive Officer. Welcome.
Talentum Oyj
Annankatu 34 – 36 B, 00100 Helsinki
Telephone +358 20 442 40
www.talentum.com
