ALMA MEDIA CORP. STOCK EXCHANGE RELEASE 26 OCTOBER 2007, 09.00 AM
(EET)
ALMA MEDIA CORPORATION'S INTERIM REPORT FOR JULY-SEPTEMBER 2007:
- Net sales rose and profitability improved
Third quarter highlights:
* Net sales MEUR 77.5 (Q3/2006: MEUR 72.9)
* Operating profit MEUR 13.4, 17.3% of net sales
(MEUR 11.5, 15.8%)
* One-time capital gain of MEUR 0.7
* Profit before tax MEUR 13.9 (MEUR 11.6)
* Earnings per share EUR 0.14 (EUR 0.12)
* Newspapers segment operating profit MEUR 10.4 (MEUR 9.7)
* Kauppalehti group operating profit MEUR 1.5 (MEUR 1.3)
* Marketplaces segment operating profit MEUR 1.3 (MEUR 1.0)
* Forecast for 2007 remains unchanged
President and CEO Kai Telanne:"Alma Media's newspaper and online media business took steps in the
right direction in the third quarter of 2007. The drivers behind
growth and improved profitability were our biggest newspapers, led by
Aamulehti, and the largest Finnish units in Marketplaces. The
profitability of local newspapers fell short of that achieved in the
previous year. This for its part speaks of the challenge also faced
by other newspapers to maintain growth in profit as media market
growth slows down and the economic cycle approaches its peak. We
expect increased fluctuation in the media market in different
business sectors and regions.
During the third quarter Alma Media carried out major product
renewals and launched new online services. Some examples are the
redesigned Kauppalehti Optio magazine, which has been well received
in the media market, the Marketplaces City 24 service in Moscow, and
Mikko.fi, a classified advertising service introduced in Finland. The
costs for starting up Mikko.fi and new foreign services will continue
to be visible in the profit of Marketplaces during the final part of
the year and next year.
Alma Media continues to develop its business operations, for example
with the redesign of Aamulehti and with newspaper online services, in
line with its strategy. Active development of the content of online
services has resulted in record numbers of visitors to the online
sites of Aamulehti and Kauppalehti."
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
third-quarter results starting at 11.00 am on 26 October 2007 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.
The presentation material in English can be downloaded from the
company's website www.almamedia.fi. A webcast in English, lasting
roughly 20 minutes, will start at the same address at 1.00 pm (EET).
A conference call in English for investors and analysts will start at
1.30 pm (EET). To participate, please call +44 (0)20 7162 0125.
Rauno Heinonen
VP, Corporation Communications and IR
Alma Media Corporation
DISTRIBUTION: Helsinki Stock Exchange, principal media
ALMA MEDIA GROUP'S INTERIM REPORT JANUARY-SEPTEMBER 2007
The descriptive part of this interim report concentrates on the
Group's performance between July and September. Figures in brackets
refer to the third quarter of 2006 unless otherwise stated. The
figures in the tables are independently rounded.
CHANGES IN GROUP STRUCTURE COMPARED TO 2006
Kainuun Sanomat sold its sheet printing business to KS Paino Oy on 15
August 2007.
Kainuun Sanomat sold its newspaper printing business to
Pyhäjokiseudun Kirjapaino Oy on 28 June 2007.
Aamulehti acquired a 40% stake in direct mailing distribution company
Tampereen Ykkösjakelu Oy on 22 May 2007.
On 1 July 2006 Kauppalehti raised its holding in TietoEnator 121 Oy
from 49% to 100%. This company was renamed Kauppalehti 121 Oy and its
annual net sales total roughly MEUR 9.
Kauppalehti group's Alma Media Lehdentekijät business acquired Suomen
Business
Viestintä Oy on 1 July 2006. This company has annual net sales of
approximately MEUR 2.5.
On 1 July 2006 two new companies, Bovision AB and Objektvision AB
with aggregate annual net sales of around MEUR 1.7, were acquired for
the Marketplaces segment.
GROUP NET SALES AND RESULT JANUARY-SEPTEMBER 2007
The Group's net sales between January and September 2007 totalled
MEUR 243.4 (MEUR 219.0). Net sales of the Newspapers segment were
MEUR 171.4, of the Kauppalehti group MEUR 51.0 and of the
Marketplaces segment MEUR 22.9.
The Group's operating profit developed favourably between January and
September 2007, totalling MEUR 43.8 (MEUR 33.1). The operating margin
was 18.0% (15.1%). A capital gain of altogether MEUR 2.6 was recorded
during the first three quarters of 2007 on the disposal on 1 February
2007 of a property in Rovaniemi used by the Lapin Kansa newspaper and
on the disposal on 19 September 2007 of land in Rovaniemi.
GROUP NET SALES AND RESULT JULY-SEPTEMBER 2007
The Group's net sales between July and September 2007 totalled MEUR
77.5 (MEUR 72.9). In monetary terms (euros) the business units that
recorded the biggest increase in net sales were Aamulehti, Iltalehti
and the Finnish online services of Marketplaces.
The Group's operating profit in the third quarter was MEUR 13.4 (MEUR
11.5) The operating margin was 17.3% (15.8%). The third quarter
operating profit includes a capital gain of MEUR 0.7 on the disposal
of land in Rovaniemi on 19 September 2007.
PROSPECTS TO YEAR END
Alma Media keeps unchanged its forecast on the development of its key
indicators during 2007: the Group expects its net sales and operating
profit to grow from the previous year. Alma Media expects the media
market to continue to grow in the final quarter of 2007, but the rate
of growth will slow down.
MARKET CONDITIONS
The Finnish economy is still growing rapidly. The autumn forecasts
from Finnish research institutions set growth in Finland's GNP at
around 4 - 4½ per cent. The rate of growth for next year is expected
to decline by about one percentage point from this.
The lively economic growth continued to be evident in the third
quarter in the growth in media advertising. According to TNS Gallup,
media advertising grew at a rate of 6.9% in the July-September 2007
period. Advertising grew 4.1% in printed newspapers, 16.3% in
television and 21.4% in online media. According to TNS Gallup, the
sectors increased their media advertising as follows; retail (+10%),
durables (+6.8%) and consumer goods (+4.7%). Classified advertising
increased 13.5% and services advertising 3.4%.
KEY FIGURES
KEY FIGURES 2007 2006 2007 2006 2006
MEUR 7-9 7-9 1-9 1-9 1-12
Net sales 77.5 72.9 243.4 219.0 301.9
Operating profit 13.4 11.5 43.8 33.1 49.1
% of net sales 17.3 15.8 18.0 15.1 16.3
Net financial expenses 0.1 0.2 0.0 0.5 0.5
Net financial expenses, % of net
sales 0.1 0.2 0.0 0.2 0.2
Share of associated companies'
results 0.6 0.3 2.1 1.1 1.2
Balance sheet total 192.5 220.8 199.7
Gross capital expenditure 2.9 11.5 8.3 16.2 19.6
Gross capital expenditure, % of
net sales 3.8 15.8 3.4 7.4 6.5
Equity ratio 58.1 50.9 61.3
Gearing, % 0.8 8.6 -5.6
Interest-bearing net debt 0.8 8.8 -6.5
Interest-bearing liabilities 21.6 52.0 21.7
Non-interest-bearing liabilities 69.4 65.4 62.7
Average no. of personnel,
calculated as full-time employees,
excl. delivery staff 2,027 2,014 1,994 1,892 1,901
Average no. of delivery staff 1,041 909 980 847 857
Earnings/share, EUR
(basic) 0.14 0.12 0.46 0.34 0.50
Earnings/share, EUR
(diluted) 0.14 0.12 0.46 0.34 0.50
Cash flow from operating
activities, EUR 0.09 0.08 0.61 0.52 0.63
Shareholders' equity/share, EUR 1.35 1.38 1.54
Market capitalization 877.4 567.1 690.2
Average no. of shares (1,000
shares)
- basic 74,613 74,613 74,613 74,613 74,613
- diluted 74,783 74,613 74,757 74,613 74,613
No. of shares at end of period
(1,000 shares) 74,613 74,613 74,613
2007 2006 2007 2006 2006
NET SALES BY SEGMENT, MEUR 7-9 7-9 1-9 1-9 1-12
Newspapers 55.0 52.2 171.4 159.7 217.9
Kauppalehti group 15.5 14.9 51.0 43.6 62.6
Marketplaces 7.6 5.9 22.9 16.7 23.1
Other operations and eliminations -0.6 -0.1 -1.9 -1.0 -1.7
Total 77.5 72.9 243.4 219.0 301.9
2007 2006 2007 2006 2006
OPERATING PROFIT/LOSS BY SEGMENT, MEUR 7-9 7-9 1-9 1-9 1-12
Newspapers 10.4 9.7 33.4 27.6 38.4
Kauppalehti group 1.5 1.3 5.4 4.0 4.8
Marketplaces 1.3 1.0 4.1 2.1 2.8
Other operations and eliminations 0.2 -0.5 0.9 -0.6 3.1
Total 13.4 11.5 43.8 33.1 49.1
NEWSPAPERS
Newspapers, key figures, MEUR 2007 2006 2007 2006 2006
7-9 7-9 1-9 1-9 1-12
Net sales 55.0 52.2 171.4 159.7 217.9
Circulation sales 27.2 25.9 80.0 75.4 101.8
Media advertising sales 25.4 23.7 83.0 75.7 104.5
Printing sales 1.1 1.3 4.2 4.4 6.2
Other sales 1.3 1.3 4.1 4.1 5.4
Operating profit 10.4 9.7 33.4 27.6 38.4
Operating margin, % 18.9 18.6 19.5 17.3 17.6
Gross capital expenditure 1.1 0.8 4.9 3.2 4.1
Average no. of personnel, calculated as
full-time employees, excl. delivery
staff 1,267 1,282 1,235 1,230 1,220
Average no. of delivery staff 1,041 909 980 847 857
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 rose in the third quarter by 5.3%
from the previous year to MEUR 55.0 as media sales remained strong.
Aamulehti and Iltalehti in particular increased their net sales.
Comparable media sales growth at local newspapers slowed down
clearly.
The growth in circulation sales reflects the increase in the price of
the weekday edition of Iltalehti in November 2006. Iltalehti's market
share has continued to rise in the declining daily tabloid market and
in the third quarter stood at 42.6%. Changes in circulation for the
other newspapers were minimal.
The third quarter operating profit of the Newspapers segment
increased 6.8%. The improvement in profit was slowed by increased
regional fluctuation in media sales, which reduced the combined
operating profit of local newspapers, and by the costs arising from
maintenance work at Satakunnan Kansa's printing facility.
KAUPPALEHTI GROUP
Kauppalehti group, key figures, MEUR 2007 2006 2007 2006 2006
7-9 7-9 1-9 1-9 1-12
Net sales 15.5 14.9 51.0 43.6 62.6
Circulation sales 6.0 5.4 18.1 17.2 23.7
Media advertising sales 4.3 4.4 15.0 15.1 21.9
Other sales 5.2 5.1 17.9 11.2 17.0
Operating profit 1.5 1.3 5.4 4.0 4.8
Operating margin, % 10.0 8.5 10.5 9.3 7.7
Gross capital expenditure 0.3 5.3 0.7 5.9 6.4
Average no. of personnel, calculated as
full-time employees 536 541 537 483 496
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. Kauppalehti 121, which
was acquired in 2006, is included in the third quarter figures for
comparison.
The Kauppalehti group's net sales in the third quarter grew by 3.9%
from the previous year to MEUR 15.5. Kauppalehti's media sales
declined from the previous year, apart from the media sales of
Kauppalehti Optio and Online, which grew well. Most of the growth in
net sales accrued from the encouraging developments in sales at the
group's smaller units.
The redesigned Kauppalehti Optio launched in September was well
received in the media market. During the first nine months of the
year, the number of weekly visitors to Kauppalehti Online rose by
110.000 to more than 250.000, which has raised Kauppalehti's total
coverage. Strong growth of weekly visitors has continued in October.
Kauppalehti group's operating profit improved, which is largely due
to the cost savings measures implemented in the spring and to the
impact of the encouraging performance of ePortti's sales.
MARKETPLACES
Marketplaces, key figures, MEUR 2007 2006 2007 2006 2006
7-9 7-9 1-9 1-9 1-12
Net sales 7.6 5.9 22.9 16.7 23.1
Operations in Finland 6.2 4.9 18.7 14.6 19.7
Operations outside Finland 1.4 1.0 4.2 2.1 3.3
Operating profit 1.3 1.0 4.1 2.1 2.8
Operating margin, % 16.7 17.3 18.1 12.5 12.3
Gross capital expenditure 0.9 4.6 1.2 5.6 7.3
Average no. of personnel, calculated as 158 115 155 104 111
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 and Bovision.
Marketplaces again put in a strong performance in the third quarter
of 2007 as market conditions remained favourable, despite the slow
down in car sales. Net sales increased 29.9% from the corresponding
period in the previous year. Boosted by Etuovi.com and Monster,
business in Finland grew 27.6%, and activities outside Finland grew
40.8%.
Marketplaces' operating profit increased 25.3% in the third quarter,
slightly more slowly than the increase in net sales. Growth in profit
was restricted by investments in developing services and the costs of
international expansion and marketing.
ASSOCIATED COMPANIES
Share of associated companies' results, MEUR 2007 2006 2007 2006 2006
7-9 7-9 1-9 1-9 1-12
Newspapers 0.1 0.0 0.1 0.0 0.0
Kauppalehti group
Talentum Oyj 0.3 -0.1 1.3 0.5 0.7
Other associated companies 0.0 0.0 0.0 0.2 0.3
Marketplaces 0.0 0.0 0.0 0.0 0.0
Other operations
Acta Print Kivenlahti Oy 0.0 0.1 0.1 -0.2 -0.4
Other associated companies 0.2 0.3 0.6 0.6 0.6
Total 0.6 0.3 2.1 1.1 1.2
The Group holds a 29.9% stake in Talentum Oyj, which is reported
under the Kauppalehti group, and 36.0% of Acta Print Kivenlahti Oy,
reported under Other Operations. Acta Print Oy announced in July the
sale of it's magazine printing business to Forssan Kirjapaino. The
company running the remaining Kivenlahti printing facility has been
renamed Acta Print Kivenlahti Oy.
BALANCE SHEET AND FINANCIAL POSITION
The Group's balance sheet totalled MEUR 192.5 at the end of September
2007 (MEUR 199.7 on 31 December 2006). The equity ratio at the end of
September was 58.1% (61.3% on 31 December 2006) and shareholders'
equity per share was EUR 1.35 (EUR 1.54 on 31 December 2006).
The Group's cash flow developed as expected. Cash flow before
financing activities was MEUR 6.6 (MEUR 1.7). At the end of September
the company had net debt totalling MEUR 0.8 (MEUR -6.5 on 31 December
2006)
The Group's interest-bearing debt is denominated in euros and
therefore does not require hedging against exchange rate differences.
Alma Media hedges the most significant purchasing agreements based in
foreign currency.
The Group currently has a MEUR 100 commercial paper programme in
Finland under which it is permitted to issue papers to a total amount
of MEUR 0-100. On 30 September 2007 this programme was entirely
unused.
CAPITAL EXPENDITURE
Capital expenditure in the third quarter totalled MEUR 2.9 (MEUR
11.5), comprising online media development projects and 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 telecommunication, 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.
THE ALMA MEDIA SHARE
Altogether 7.3 million Alma Media shares were traded between July and
September 2007, which represented 9.7% of the total number of shares.
The closing price of the Alma Media share at the end of September was
EUR 11.76. The lowest quotation during the period was EUR 9.99 and
the highest was EUR 11.85. The company's market capitalization at the
end of September was MEUR 877.4.
In March the company paid a dividend of EUR 0.65 per share, totalling
MEUR 48.5.
The company does not own any of its own shares and it has no
authorizations to purchase its own shares.
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.
So far 515,000 of the 2006A options have been issued to Group
management. Altogether 65,000 of the 2006A options have been returned
to the company owing to the termination of employment contracts. On 8
March 2007 the company's Board of Directors decided to annul the
190,000 2006A option rights in the company's possession.
In March 2007 the Board of Directors decided to issue 510,000 options
under the 2006B scheme to Group management.
If all the subscription rights were exercised, this programme would
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 6.48 per
share and the subscription price under the 2006B option was EUR 9.85
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 July and September 2007 the company has not received notice
of any significant changes in the company's ownership as referred to
in Chapter 2, Section 10 of the Securities Market Act.
EVENTS AFTER THE END OF PERIOD
Alma Media Corporation announced on 26 October 2007 that it was
cancelling the finance leasing agreement for the office and printing
works property in Patamäenkatu in Tampere and making a new lease for
the property with the new landlord. The arrangement will form a
one-time profit of MEUR 9.0, which will be reported in the final
quarter figures for 2007.
2007 2006 2007 2006 2006
INCOME STATEMENT, MEUR 7-9 7-9 1-9 1-9 1-12
NET SALES 77.5 72.9 243.4 219.0 301.9
Other operating income 1.3 0.2 4.0 0.9 5.5
Materials and services -24.6 -22.6 -73.4 -67.0 -92.0
Costs arising from employment
benefits -25.3 -24.8 -81.7 -75.7 -105.7
Depreciation and writedowns -2.7 -2.5 -7.5 -7.5 -10.1
Operating expenses -12.8 -11.7 -41.0 -36.7 -50.4
OPERATING PROFIT 13.4 11.5 43.8 33.1 49.1
Financial income 0.3 0.5 1.0 1.8 2.1
Financial expenses -0.3 -0.7 -1.0 -2.3 -2.6
Share of associated companies'
results 0.6 0.3 2.1 1.1 1.2
PROFIT BEFORE TAX 13.9 11.6 45.9 33.7 49.9
Income tax -3.4 -2.7 -11.3 -8.2 -12.5
PROFIT FOR THE PERIOD 10.5 8.9 34.6 25.5 37.3
Distribution:
To the parent company shareholders 10.3 8.8 34.1 25.2 37.0
Minority interest 0.1 0.1 0.5 0.3 0.3
Earnings/share, EUR 0.14 0.12 0.46 0.34 0.50
Earnings/share (diluted), EUR 0.14 0.12 0.46 0.34 0.50
BALANCE SHEET, MEUR 30.9.2007 30.9.2006 31.12.2006
ASSETS
NON-CURRENT ASSETS
Goodwill 29.8 29.0 30.2
Intangible assets 9.7 9.7 9.7
Tangible assets 50.4 57.3 51.7
Investment properties 0.0 2.5 0.0
Investments in associated companies 32.7 32.9 32.1
Other long-term investments 3.9 3.9 3.9
Deferred tax assets 3.7 3.7 4.1
Other receivables 0.2 5.2 4.8
CURRENT ASSETS
Inventories 1.3 1.5 1.8
Tax receivables 0.0 1.2 0.7
Accounts receivable and other
receivables 32.6 28.6 28.8
Other short-term investments 2.6 2.4 2.4
Cash and cash equivalents 20.8 43.0 28.2
ASSETS AVAILABLE FOR SALE 4.7 1.2
TOTAL ASSETS 192.5 220.8 199.7
BALANCE SHEET, MEUR 30.9.2007 30.9.2006 31.12.2006
SHAREHOLDERS' EQUITY AND LIABILITIES
Share capital 44.8 44.8 44.8
Share premium fund 2.8 2.8 2.8
Cumulative translation adjustment 0.1 0.0 0.1
Retained earnings 53.3 55.5 67.2
Parent company shareholders' equity 101.0 103.1 114.9
Minority interest 0.5 0.3 0.4
TOTAL SHAREHOLDERS' EQUITY 101.5 103.5 115.3
LIABILITIES
Non-current liabilities
Interest-bearing liabilities 18.8 19.3 19.1
Deferred tax liabilities 1.6 2.0 1.8
Pension obligations 3.6 3.6 3.6
Provisions 0.1 0.2 0.1
Other long-term liabilities 6.8 7.4 7.2
Current liabilities
Interest-bearing liabilities 2.8 32.5 2.6
Advances received 17.8 17.5 11.6
Tax liabilities 2.0 0.1 2.2
Provisions 1.3 0.7 2.3
Accounts payable and other
liabilities 36.2 34.0 33.9
TOTAL LIABILITIES 91.0 117.4 84.4
TOTAL EQUITY AND LIABILITIES 192.5 220.8 199.7
RECONCILIATION OF SHAREHOLDERS' EQUITY 1 JAN. - 30 SEPTEMBER 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 0.1 0.1 0.1
Income recognized
directly in equity 0.1 0.1 0.1
Profit for the
period 34.1 34.1 0.5 34.6
Net income for the
period 34.2 34.2 0.5 34.7
Share-based
payments 0.4 0.4 0.4
Dividend paid by
parent company -48.5 -48.5 -48.5
Dividends paid -0.4
by subsidiaries
Equity, 30 Sept. 44.8 2.8 53.3 101.0 0.5 101.5
2007
RECONCILIATION OF SHAREHOLDERS' EQUITY 1 JAN. - 30 SEPTEMBER 2006
Share Parent
Share premium Retained company, Minority Equity,
MEUR capital fund earnings total interest total
Equity, 1 Jan.
2006 44.8 42.4 39.0 126.2 0.5 126.7
Translation
differences
Share of items
recognized
directly in
associated
company's equity 0.1 0.1 0.1
Income
recognized
directly in
equity 0.1 0.1 0.1
Profit for the
period 25.2 25.2 0.3 25.5
Net income for
the period 25.3 25.3 0.3 25.6
Share-based
payments 0.2 0.2 0.2
Dividend paid
by parent
company -9.0 -9.0 -9.0
Capital
repayment by
parent company -39.5 -39.5 -39.5
Dividends paid -0.3 -0.3
by subsidiaries
Dissolution of -0.2 -0.2
subsidiary
Equity, 30 Sept. 44.8 2.8 55.5 103.1 0.3 103.5
2006
2007 2006 2007 2006 2006
CASH FLOW STATEMENT, MEUR 7-9 7-9 1-9 1-9 1-12
Cash flow from operating activities
Profit for the period 10.5 8.9 34.6 25.5 37.3
Adjustments 4.3 5.0 12.5 14.3 18.2
Change in working capital -4.6 -5.4 5.9 1.4 -3.8
Dividend income received 0.0 0.0 3.2 5.5 6.4
Interest income received 0.3 0.5 0.8 1.6 1.9
Interest expenses paid -0.3 -0.3 -1.0 -1.0 -3.1
Taxes paid -3.4 -3.0 -10.6 -8.5 -10.3
Net cash provided by operating
activities 6.8 5.6 45.2 38.8 46.7
Cash flow from investing activities
Investments in tangible and intangible
assets -1.4 -0.9 -3.8 -4.1 -5.4
Proceeds from disposal of tangible and
intangible assets 1.3 0.0 1.5 0.5 3.8
Other investments 0.0 0.0 0.0 0.0 0.0
Proceeds from disposal of other
investments 0.0 1.4 3.2 2.1 9.1
Subsidiary shares purchased -0.1 -4.4 -0.3 -8.0 -9.0
Associated company shares purchased 0.0 0.0 -1.6 0.0 0.0
Net cash used in investing activities -0.2 -3.9 -0.9 -9.4 -1.5
Cash flow before financing activities 6.6 1.7 44.5 29.3 45.2
Cash flow from financing activities
Long-term loan repayments 0.0 0.0 0.0 -3.6 -33.6
Short-term loans raised 0.0 0.0 2.0 0.0 0.0
Short-term loans repaid -0.8 -2.2 -4.5 -3.5 -3.5
Change in interest-bearing receivables -0.2 0.2 -0.5 0.0 -0.6
Dividends paid and capital repayment 0.0 -39.8 -48.9 -48.8 -48.8 -1.0 -41.7 -51.9 -55.9 -86.5
Change in cash funds (increase + /
decrease -) 5.5 -40.0 -7.4 -26.7 -41.4
Cash and cash equivalents at start of
period 15.2 83.0 28.2 69.6 69.6
Cash and cash equivalents at end of
period 20.8 43.0 20.8 43.0 28.2
BUSINESS ACQUISITIONS 1-9/2007
The Group did not acquire any new business operations during the
first three quarters of 2007.
Aamulehti Oy acquired a 40% holding in Tampereen Ykkösjakelut Oy in
May 2007.
INFORMATION BY SEGMENT
Alma Media's reporting segments in this interim report are
Newspapers, Kauppalehti group and Marketplaces. Other Operations
comprises the Group's parent company and the operations of the
Group's financial management service centre.
The descriptive section of this report 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.
INFORMATION BY SEGMENT
ASSETS BY SEGMENT, MEUR 30.9.2007 30.9.2006 31.12.2006
Newspapers 66.2 68.1 66.7
Kauppalehti group 57.4 57.0 56.1
Marketplaces 15.6 12.9 13.9
Other operations and eliminations 25.2 31.0 29.3
Non-allocated assets 28.2 51.8 33.8
Total 192.5 220.8 199.7
LIABILITIES BY SEGMENT, MEUR 30.9.2007 30.9.2006 31.12.2006
Newspapers 33.9 32.7 29.9
Kauppalehti group 14.6 11.6 12.2
Marketplaces 4.3 3.3 3.5
Other operations and eliminations 9.2 11.9 9.4
Non-allocated liabilities 29.0 57.9 29.4
Total 91.0 117.4 84.4
2007 2006 2007 2006 2006
GROUP INVESTMENTS, MEUR 7-9 7-9 1-9 1-9 1-121-12
Gross capital expenditure 2.9 11.5 8.3 16.2 19.6
PROVISIONS
The company's provisions at the end of September 2007 totalled MEUR
1.4, the most important of which was a MEUR 0.6 provision to cover
restructuring measures in Kauppalehti. MEUR 0.6 of this provision has
been reversed corresponding to actual costs in the period 1-9/2007.
It has not been necessary to change the estimates made when the
provision was entered.
COMMITMENTS AND CONTINGENCIES, MEUR 30.9.2007 30.9.2006 31.12.2006
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 6.0 5.7 6.1
Within 1-5 years 13.7 13.8 14.6
After 5 years 11.8 11.6 13.0
Total 31.5 31.1 33.7
The Group also has purchase agreements
based on IFRIC 4 which include a lease
component per IAS 17. Minimum payments
based on these agreements: 5.1 7.9 7.7
GROUP DERIVATIVE CONTRACTS, MEUR 30.9.2007 30.9.2006 31.12.2006
Raw material derivatives
Fair value * 0.0
Amount, tonnes 5,000
Nominal value 2.6
* The fair value represents the return that would have arisen if the
derivative positions had been cleared on the balance sheet date.
The Group had no open derivative positions on 30 September 2007.
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.
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 PARTIES
RELATED PARTY ACTIVITIES 1.1-30.9.2007 (9 1.1-31.12.2006 (12
WITH ASSOCIATED COMPANIES, months) months)
MEUR
Sales of goods and services 0.1 0.4
Purchases of goods and
services 4.5 4.4
Accounts receivable, loan
and other receivables at
the balance sheet date 4.7 4.6
Accounts payable at the
balance sheet date 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 the recognition and
measurement principles of 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 2006. 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 2006.
The key indicators are calculated using the same formulae as applied
in the annual financial statements.
On 1 January 2007 the Group adopted the following new accounting
standards and interpretations:
IFRS 7 Financial Instruments: Disclosures
IAS 1 Presentation of Financial Statements: Capital Disclosures
IFRIC 8 Scope of IFRS 2
IFRIC 9 Re-assessment of Embedded Derivatives
IFRIC 10 Interim Financial Reporting and Impairment
The aforementioned new standards and interpretations have only a very
minor effect on the Group's income statement and balance sheet. Their
application mainly affects the notes to the accounts.
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 Kivenlahti Oy. This divestment is not expected
to have a significant impact on Alma Media's financial position.
The figures in this interim report 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.
ALMA MEDIA CORPORATION
Board of Directors
Alma Media Corporation s Interim Report for July-September 2007
| Source: Alma Media
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