MTG takes next step in strategic transformation


MTG is today taking the next step in its strategic transformation by launching a
restructuring programme. The objective is to drive the Group’s ongoing digital
transformation, fuel investments in the Group’s existing businesses, and to
enable the Group to continue to generate profitable growth. The new structure
will realign a wide range of functions, increase efficiency levels across the
business, yield savings to offset the significant adverse currency effects that
the Group faces and enable reinvestment in the Group’s core business and
continued digital expansion.
This will result in a proposed reduction of MTG’s employee base by a net of
approximately 300 positions in Sweden, Norway, Denmark, and UK combined, as well
as the impairment of content and other assets.

Net restructuring charges are expected to amount to approximately SEK 700
million and all be charged against the Group’s operating income in Q3 2015 as a
non-reoccurring item. Approximately 60% of the charges refer to redundancy
costs, and 40% to impairment charges. The cash flow impact is expected to be
approximately SEK 550 million. The restructuring is expected to generate
annualized savings of approximately SEK 600 million, of which the majority will
be reinvested back into the Group’s ongoing transformation into a broad based
video entertainment company.
The majority of the savings will impact in 2016 and have full effect from 2017.

“We started on this journey to transform the Group, in order to drive and shape
the fast moving changes in consumer behaviour and the video entertainment
environment. We want to be able to continue to invest in our successful existing
operations and exciting new businesses, in order to secure our future profitable
growth, and that requires accelerated changes in our current structure. Today’s
announcement follows the management changes we made in May, and local leadership
teams are now adjusting their organizations accordingly.

The decisions and actions that we are taking are difficult because valued
colleagues will leave the group, but they are necessary and we are doing all
that we can to assist those affected by these changes.”

Jørgen Madsen Lindemann, MTG President and CEO

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MTG (Modern Times Group MTG AB (publ.)) is an international entertainment group.
Our operations span six continents and include TV channels and platforms, online
services, content production businesses and radio stations. We are also the
largest shareholder in CTC Media, which is Russia’s leading independent media
company. Our shares are listed on Nasdaq OMX Stockholm (‘MTGA’ and ‘MTGB’).

The information in this announcement is that which MTG is required to disclose
according to the Securities Market Act and/or the Financial Instruments Trading
Act, and was released at 10.55 CET on 24 August 2015.

Attachments

08247574.pdf