5 November 2015
Company announcement no 09-15
| FK Distribution is heavily and adversely affected by unreasonably price competition by Post Danmark: |
The total number of letters continues to go down – yet Post Danmark continues to increase the letter rate!
The total volume of unaddressed printed matter continues to decline – yet Post Danmark continues to lower distribution prices!
- Close on 500,000 households have now signed up for NoAds+, which progresses as planned.
- The Group’s strategic efforts of strengthening and developing its market positions are generally proceeding as planned.
- Considerable resources are still dedicated to expanding NoAdds+, BEKEY and Online activities.
- Group revenue is DKK 228.0 million for Q3 2015. This is within the range of expectations, although at the lower end.
- Group EBITDA for Q3 2015 is negative by DKK 1.3 million and EBIT stands at a negative DKK 13.0 million. This is as anticipated.
- The Group’s net interest-bearing cash position is DKK 71.6 million, and capital resources come to DKK 263.2 million at 30 September 2015.
FK Distribution’s revenue dropped by approx 10% in Q3 2015 on the same quarter last year. This is the main reason for group revenue for Q3 2015 being 8% lower than for Q3 2014. Revenue from newspaper activities went down by 8% on the same period last year and fell short of expectations. Revenue from the Online segment was 5% lower compared to the same period last year and behind expectations, which is a result of the divestment of Godmail.dk, the change in strategy for håndværker.dk in mid-2014 and the readjustment of the pricing model for BoligPortal.dk.
In Q3 2015, Group EBIT was negative by DKK 13.0 million, which is DKK 20.4 million down on the same quarter last year, when Group EBIT was DKK 7.4 million. This decline came as expected and was caused primarily by FK Distribution but also by the lower revenue generated this year from the newspaper activities. The Q3 2015 EBIT from the Online segment was a negative DKK 3.9 million compared to positive EBIT of DKK 2.4 million for the same period last year. This decrease in performance was a little larger than expected due to the decision to develop and strengthen the market position of BoligPortal.dk and håndværker.dk by way of new products and intensified marketing efforts.
FK Distribution continues to increase the number of households signed up for No Ads+.
During Q3 2015, close on 60,000 new households signed up for NoAds+. The number of NoAds+ households now totals almost 500,000, and the activity is developing very satisfactorily and according to plan.
BEKEY expands its product portfolio and activities outside Denmark.
BEKEY is selling electronic lock systems and increasingly also key cabinets that are also controlled from the internet-based administration system NETKEY. The sale of emergency call systems is growing rapidly too.
The BEKEY system is now being tested or in operation in 21 municipalities in Denmark, two in Sweden and three in Norway. In addition, arrangements have been made with a Finnish partner, and some other co-operation agreements with other countries are in the process of negotiation.
As anticipated, BEKEY’s revenue was substantially higher in Q3 2015 compared to the same quarter last year.
Developments in revenue from newspaper activities were a little behind expectations and revenue is lower than last year
Newspaper sales to regional retail customers were lower than last year and behind expectations. Sales to large customers and chains, however, were up to expectations and higher than last year.
Viewed on a three-month basis, the Søndagsavisen readership has gone up by 3% on the same period in 2014.
Ofir’s revenue is weaker than expected
Both advertisement revenue from Ofir Jobunivers and sales of the electronic recruiting system Emply-Hire saw weaker development in Q3 2015 than expected.
New media have been added to Ofir Jobunivers, which has prompted a massive increase in the number of applications received by employers when posting their vacancies through Ofir Jobunivers.
håndværker.dk improves its market position.
håndværker.dk continues to develop positively, seeing growth in the number of builders registered and recommendations. To strengthen this position further, more money was invested in marketing initiatives in Q3 2015 than projected, which has an adverse short-term effect on performance. Together with Renault and Danish consumers, håndværker.dk will in Q4 2015 elect Denmark’s best builder.
In Q3 2015, BoligPortal.dk readjusted its pricing structure, leading to more users and better conversion.
Primarily due to the decision to readjust prices and thus stagger revenue, BoligPortal.DK’s revenue for Q3 2015 came out lower than anticipated. The strategic initiatives are proceeding according to expectations, and a portfolio of new products is in the pipeline.
Expectations for group revenue and performance for FY 2015 are maintained and made more specific.
Group’s revenue is expected to range from DKK 1,000 million to DKK 1,020 million for 2015. Group EBIT is expected to range from a negative DKK 15 million to DKK 0 million for 2015.
Please contact Lars Nymann Andersen, CEO, at +45 40 36 26 30 or Kåre Wigh, CFO, at +45 25 65 21 45 for further information.
