2007-08-02 10:03:23 CEST
2007-08-02 10:03:23 CEST
REGULATED INFORMATION
SanomaWSOY - Quarterly report
SanomaWSOY s Interim Report January-June 2007
SanomaWSOY Corp. Stock Exchange Release 2 Aug 2007 at 11:00
Group net sales increased by 7.3%, totalling EUR 1,408.0 (1,311.7)
million. Operating profit was up to EUR 186.9 (138.4) million.
Operating profit included major non-recurring capital gains of EUR
35.4 (1.7) million, most of which were accrued during the second
quarter. Sanoma Magazines, Sanoma and Rautakirja improved their
results. In the second quarter, Group net sales were EUR 744.4
(699.2) million and operating profit rose to EUR 133.0 (92.8)
million. Second quarter earnings per share, including capital gains,
was EUR 0.58 (0.39).
KEY INDICATORS 4-6/ 4-6/ Change 1-6/ 1-6/ Change 1-12/
EUR million 2007 2006 % 2007 2006 % 2006
Net sales 744.4 699.2 6.5 1,408.0 1,311.7 7.3 2,742.1
Operating profit 133.0 92.8 43.3 186.9 138.4 35.1 292.5
% of net sales 17.9 13.3 13.3 10.6 10.7
Operating profit 98.8 92.8 6.4 151.5 136.8 10.8 288.2
excluding major
non-recurring
capital gains
% of net sales 13.3 13.3 10.8 10.4 10.5
Balance sheet total 3,256.6 3,037.7 7.2 3,132.2
Capital expenditure 28.1 17.7 58.4 43.2 33.0 30.8 81.9
% of net sales 3.8 2.5 3.1 2.5 3.0
Equity ratio, % 42.7 38.7 45.0
Gearing, % 71.5 90.0 59.2
Interest-bearing 1,020.7 1,069.0 -4.5 863.9
liabilities
Net debt 930.8 993.2 -6.3 782.4
Personnel under 19,267 17,958 7.3 18,434
employment
contract, average
Personnel, average 16,566 15,282 8.4 15,732
(full-time
equivalents)
Earnings/share, EUR 0.58 0.39 47.6 0.80 0.60 32.5 1.32
Earnings/share, 0.57 0.38 49.6 0.79 0.59 33.7 1.31
diluted, EUR
Cash flow from 0.12 0.27 -53.0 0.25 0.25 1.3 1.63
operations/share,
EUR
Equity/share, EUR * 7.79 6.84 14.0 7.92
Market 3,877.7 2,999.3 29.3 3,521.8
capitalisation
* Excluding minority interest
Hannu Syrjänen, President and CEO:"The first half of 2007 was good for us. We achieved good organic
growth. Net sales adjusted for changes in the Group structure
increased by 4.9% and operating profit, excluding major non-recurring
capital gains, improved by 10.8%. Our markets have developed
positively, and advertising sales growth was particularly strong in
the first quarter.
In the first half of the year we have invested heavily in the
development of both existing products and services and new projects.
We have launched numerous magazines, especially in Russia and Central
Eastern Europe. Our range of online services has also been expanded
through in-house projects and acquisitions; for example, in the
Netherlands, Finland, Bulgaria and Romania. At the beginning of the
year we launched a new television channel and two new radio channels
in Finland, and a new digital pay TV channel is due to launch in the
autumn.
The main focus of our growth is in Russia and Central Eastern Europe.
In April, Finnkino expanded its movie theatre and movie rental
businesses in the Baltic countries, and educational publishing
completed its summer 2006 acquisition by purchasing the remaining
shareholdings in the Hungarian Láng Group. In Russia, the first
R-kiosks opened their doors to customers in June. In July, after the
review period, SanomaWSOY acquired Polish educational publisher Nowa
Era. We will continue to expand our magazine, educational publishing
and press distribution operations internationally, and develop our
digital business and improve our efficiency.
Our diverse business portfolio balances the variations between
quarters. The market situation is quite positive in most of the
countries where we operate, and therefore our growth will continue to
be good also on the latter part of 2007."
Operating environment
In January-June 2007, media advertising developed positively in most
of SanomaWSOY's countries of operation. According to TNS Gallup Adex,
advertising in Finland grew by 7%. Excluding advertising related to
parliamentary elections, sales were up by 5%. Advertising in
newspapers increased by 8%, but decreased by 2% in free sheets. Job
advertising increased by 23%, while magazine advertising grew by 4%
and television advertising by 6%. ZenithOptimedia estimates that
magazine advertising in 2007 will grow by 2% in the Netherlands, but
only by just under 1% in Belgium and Hungary. In the Czech Republic,
the growth rate is expected to be 10%. Expenditure on print media
advertising in Russia is estimated to increase by 24%. In all of
these countries, online advertising is expected to grow considerably
faster than other media advertising.
According to the Finnish Grocery Trade Association, Finnish sales of
daily consumer goods grew by 3% in January-May.
Net sales
In January-June, SanomaWSOY's net sales were up by 7.3%, totalling
EUR 1,408.0 (1,311.7) million. Net sales increased markedly across
all divisions. Net sales adjusted for changes in the Group structure
increased by 4.9%.
Advertising sales accounted for 25% (24%) of the Group's total net
sales. In geographical terms, Finland accounted for 50% (51%) of net
sales with other EU countries accounting for 45% (45%) and other
countries for 5% (4%).
Result
The Group's operating profit grew to EUR 186.9 (138.4) million or
13.3% (10.6%) of net sales. Operating profit included major
non-recurring capital gains of EUR 35.4 (1.7) million, from
divestments of e.g. puzzle magazines and a land area. Excluding these
gains, operating profit was EUR 151.5 (136.8) million. The result was
improved by the positive development of Sanoma Magazines, Sanoma and
Rautakirja. In addition to the growth of sales, the increase in
operating profit was driven by moderate cost development and, for
example, the deferral of some marketing investments to the second
half of the year.
SanomaWSOY's net financial items totalled EUR -16.7 (-13.7) million.
Financial income consisted primarily of interest income and amounted
to EUR 4.7 (3.4) million. Financial expenses amounted to EUR 21.3
(17.1) million. These were comprised primarily of interest costs of
EUR 19.8 (15.5) million on interest-bearing liabilities.
The result before taxes was EUR 174.8 (128.9) million and earnings
per share was EUR 0.80 (0.60).
Balance sheet and financial position
The consolidated balance sheet increased and, as of 30 June 2007,
totalled EUR 3,256.6 (3,037.7) million. Cash flow from operations was
EUR 41.9 (39.4) million and cash flow per share was EUR 0.25 (0.25).
The development of cash flow from operations was impacted by strong
fluctuations in working capital caused by seasonal variations, as
well as higher taxes and interest expenses in comparison to the
comparable period.
SanomaWSOY's equity ratio improved to 42.7% (38.7%) at the end of
June, while gearing was reduced to 71.5% (90.0%). Equity increased to
EUR 1,301.6 (1,103.5) million. The conversion of stock options and
convertible capital notes into shares has served to increase
shareholders' equity and the equity ratio. Interest-bearing
liabilities decreased to EUR 1,020.7 (1,069.0) million and net debt
to EUR 930.8 (993.2) million. At the end of June, the Group's cash
and cash equivalents totalled EUR 89.9 (75.8) million.
Investments and acquisitions
In January-June, SanomaWSOY's investments in tangible and intangible
assets totalled EUR 43.2 (33.0) million. These investments consisted,
for example, of ICT system acquisitions and replacement investments.
R&D expenditure was recorded at EUR 7.5 (7.4) million.
There were no major acquisitions during the period under review or
the comparable period.
Management
The Annual General Meeting of 4 April 2007 confirmed the number of
SanomaWSOY's Board members at ten and re-elected those who had
reached the end of their term of office. The Board of Directors of
SanomaWSOY consists of: Jaakko Rauramo, Chairman, Sari Baldauf, Vice
Chairman, and Robert Castrén, Jane Erkko, Paavo Hohti, Sirkka
Hämäläinen-Lindfors, Seppo Kievari, Robin Langenskiöld, Hannu
Syrjänen and Sakari Tamminen as members.
The Annual General Meeting re-appointed Pekka Pajamo, APA, and Sixten
Nyman, APA, as his deputy, and chartered accountant KPMG Oy Ab with
Kai Salli, APA, acting as the Auditor in Charge as the auditors of
the Company.
SanomaWSOY's management model was renewed. Since 5 April 2007, the
Executive Management Group consists of SanomaWSOY's President and CEO
Hannu Syrjänen, and the directors of each division: Eija Ailasmaa,
President and CEO of Sanoma Magazines; Mikael Pentikäinen, President
of Sanoma; Jacques Eijkens, CEO of SanomaWSOY Education; Tapio
Kallioja, President of SWelcom; and Erkki Järvinen, President and CEO
of Rautakirja. The authorisations and responsibilities of the
Executive Management Group remained unchanged.
In connection with this change in management model, SanomaWSOY's
Board of Directors appointed deputies for SanomaWSOY's upper
management: deputy to Hannu Syrjänen, President and CEO of
SanomaWSOY, is Eija Ailasmaa, President and CEO of Sanoma Magazines;
deputy to Mikael Pentikäinen, President of Sanoma Corporation, is
Pekka Soini, President of Helsingin Sanomat; deputy to Jacques
Eijkens, CEO of SanomaWSOY Education, is Veli-Pekka Elonen, President
of WSOY; deputy to Tapio Kallioja, President of SWelcom, is Pekka
Jaakola, Senior Vice President, Technology; and deputy to Erkki
Järvinen, President and CEO of Rautakirja, is Hellevi Kekäläinen, CFO
of Rautakirja. At the same time, SanomaWSOY established the Corporate
Center to support the Group's divisions.
Board authorisations
The AGM of 4 April 2007 authorised the Board of SanomaWSOY to decide
on the purchase of the Company's shares and an increase in share
capital.
Under the authorisation, the Board may decide on the purchase of the
Company's shares with distributable profits until the AGM of 2008. A
maximum of 8,200,000 may be purchased. These shares will not be
purchased in relation to the share holdings of existing shareholders.
They will be purchased with the Company's unrestricted equity at the
market price of the purchasing moment. However, the minimum
purchasing price of a share is the lowest market price in the public
trading and the maximum purchasing price is the highest price noted
on the public trade during the authorisation period.
The AGM also authorised the Board to decide, until the AGM of 2010,
on the issue of new shares, the disposal of treasury shares and the
granting of special rights entitling to shares. The authorisation
does not exclude the right of the Board of Directors to decide on a
directed share issue. With this authorisation, and as a result of the
use of special rights, the Board is authorised to decide on the
issuance of a maximum of 82,000,000 new shares and the disposal of a
maximum of 5,000,000 treasury shares. In a directed share issue, a
maximum of 41,000,000 shares can be issued or disposed of. With this
authorisation, the Board is authorised to issue a maximum of
5,000,000 stock options as part of an incentive programme of the
Company.
Authorisations were not exercised during the period under review.
Shares and holdings
In January-June, trading with SanomaWSOY shares accounted for 28% of
the average number of shares in issue during the period, or about
45.9 million shares. SanomaWSOY's total stock exchange turnover was
EUR 1,025.4 (958.4) million.
At the end of the review period, SanomaWSOY's market capitalisation
was EUR 3,877.7 (2,999.3) million. The closing price for the period
was EUR 23.47 (18.82) per share. The share price averaged EUR 22.34
over the period with a low of EUR 20.56 and a high of EUR 23.99. At
the end of the period, the Company had a total of 16,346
shareholders. Foreign holdings accounted for 13.0% (10.6%) of the
shares and votes. The Company did not hold any of its own shares
(treasury shares) at the end of June.
There were no major changes in share ownership during the review
period and SanomaWSOY did not issue any flagging announcements. At
the end of June, SanomaWSOY's registered share capital was EUR
71,043,801.49 and the number of shares on the market was 165,218,143.
The conversion period of SanomaWSOY Corporation's convertible capital
note ended on 20 June 2007. During the conversion period from 6
September 2001 to 20 June 2007, convertible capital notes worth EUR
149,900,000 were converted into 9,421,615 SanomaWSOY shares. In
addition, SanomaWSOY redeemed and invalidated 4,944 notes, worth EUR
49,440,000. At the end of the review period, 39 convertible capital
notes were converted into 24,507 shares. The corresponding increase
in SanomaWSOY's share capital is expected to be entered into the
Trade Register in August 2007.
SanomaWSOY Corporation issued a convertible capital note on 31 August
2001 and trading with the notes began on the Main List of the
Helsinki Stock Exchange on 6 September 2001. The imputed conversion
price of a share was EUR 15.91 and the nominal value of each note was
EUR 10,000. The loan matured after the review period on 4 July 2007,
on which date the non-converted capital notes totalling EUR 660,000
were repaid.
Dividend
In accordance with the AGM's decision, SanomaWSOY paid out a
per-share dividend of EUR 0.95 (0.90) for 2006. The record date for
dividend payment was 11 April 2007 and the dividend payment date was
18 April 2007. SanomaWSOY conducts an active dividend policy and
primarily distributes over half of the Group result after taxes in
dividends.
Seasonal fluctuation
Developments in media advertising have an impact on the net sales and
results of Sanoma Magazines, Sanoma and SWelcom. Advertising sales
are influenced, for example, by the number of newspaper and magazine
issues published during each quarter, which varies yearly. Television
advertising in Finland is usually strongest in the second and fourth
quarters.
A major portion of the net sales and results in publishing and
retail, for example, is generated in the last quarter, particularly
from Christmas sales, while educational publishing accrues most of
its net sales and results during the second and third quarters.
Seasonal business fluctuations influence the Group' net sales and
operating profit with the first quarter traditionally being the
smallest.
Outlook for 2007
In 2007, SanomaWSOY's net sales are projected to grow more than last
year. In 2006, net sales increased by 4.6%. Operating profit
excluding major non-recurring capital gains is expected to improve.
In 2006, operating profit excluding capital gains totalled EUR 288.2
million.
The forecast for the development of SanomaWSOY's net sales and
operating profit in 2007 is based on both organic growth and growth
based on minor acquisitions. During 2007, SanomaWSOY will continue
its strong focus on investing in digital media and strengthening its
market positions. In addition to the Group's own business activities
and development projects, the growth of net sales and operating
profit are also affected by the overall economic development, such as
the growth of media advertising and private consumption in the
Group's operating countries. Short-term risks and uncertainties are
related to market development, particularly the growth rate of
advertising and its distribution across different media. Risks
related to the industry and the Group's business as well as Group
risk management are described in more detail in SanomaWSOY's
Financial Statements 2006.
European economies are projected to grow in 2007, albeit at a slower
rate than in 2006. Research institutions predict that GDP will grow
by 2.4% in the Netherlands, 2.3% in Belgium and 3.5% in Finland. The
growth rate is expected to be 2.7% in Hungary, 5.2% in the Czech
Republic and 6.5% in Russia. In 2007, private consumption is
estimated to increase by 2.7% in Finland, 2.9% in the Netherlands,
2.2% in Belgium, 5.2% in the Czech Republic and 10.4% in Russia. In
Hungary, private consumption is expected to decrease by 0.6%.
Sanoma Magazines
Sanoma Magazines is one of Europe's largest consumer magazine
publishers, operating in 13 countries. In addition to publishing its
strong portfolio of magazine brands for various reader communities,
Sanoma Magazines is expanding its business to other media platforms,
with a strong focus on interactivity.
- Significant growth of online advertising continues; in total, the
Division's online advertising sales were up by 48%
- Investments in magazine launches and developing online operations
continue, especially in Sanoma Magazines International
- Divestment of puzzle magazines in the Netherlands
KEY INDICATORS 4-6/ 4-6/ Change 1-6/ 1-6/ Change 1-12/
EUR million 2007 2006 % 2007 2006 % 2006
Net sales 308.2 292.3 5.4 595.3 556.4 7.0 1,155.9
Operating profit 61.3 35.3 73.4 93.4 58.6 59.3 128.8
% of net sales 19.9 12.1 15.7 10.5 11.1
Operating profit 41.3 35.3 16.8 72.2 58.6 23.1 126.2
excluding major
non-recurring
capital gains
% of net sales 13.4 12.1 12.1 10.5 10.9
Balance sheet total 1,971.4 1,697.4 16.1 1,910.0
Capital expenditure 10.1 7.8 30.3 16.5
Personnel under 5,532 5,140 7.6 5,302
employment
contract, average
Personnel, average 5,085 4,680 8.7 4,848
(full-time
equivalents)
OPERATIONAL INDICATORS * 1-6/2007 1-6/2006
Number of magazines published 311 235
Magazine copies sold, thousands 214,786 216,145
Number of advertising pages sold 30,973 27,236
* Including joint ventures
Sanoma Magazines' net sales in January-June grew by 7.0%, amounting
to EUR 595.3 (556.4) million. Growth came from Sanoma Magazines
International, Sanoma Magazines Belgium and Sanoma Magazines Finland.
Adjusted for changes in the Group structure, the Division's net sales
grew by 4.8%. Of the Division's net sales, 17% (17%) came from
Finland. The Dutch press distribution company Aldipress has been
transferred to Rautakirja as of 1 January 2007, and figures for the
comparable year have been adjusted accordingly.
The Division's advertising sales increased by 16% in the first half
of the year and represented 30% (27%) of net sales. With all
businesses developing favourably, most advertising growth came from
Sanoma Magazines International and online advertising sales in the
Netherlands.
Circulation sales grew by 4% and represented 57% (59%) of Sanoma
Magazines' net sales. The increase was partly the result of improved
single copy sales in Belgium and the growth of subscription sales in
Finland and Belgium.
Net sales in Sanoma Magazines Netherlands amounted to EUR 256.4
(255.4) million. Advertising sales increased, with both solid growth
in print advertising and strong growth in online advertising sales.
In January-June, Sanoma Magazines Netherlands' online advertising
grew by 42%. Strong brands like Donald Duck, Libelle and Margriet
performed well in the readers market, but single copy sales decreased
slightly and total circulation sales were slightly below the
comparable period. Sanoma Magazines Netherlands strengthened its
online operations by acquiring the finance portal Belegger.nl in
March and Schoolbank.nl, a former schoolmates community website, in
May. Mind Magazine, a glossy focusing on psychology, was launched in
May. In June, the puzzle magazines portfolio was divested.
Sanoma Magazines International's net sales grew to EUR 134.3 (117.8)
million. Growth came mainly from increased advertising sales.
Advertising sales grew in nearly all operating countries, especially
in Russia and Hungary where online advertising is developing
positively. Circulation sales were slightly above the comparable
period. In January-June, Sanoma Magazines International made several
online launches and acquisitions. It also developed its magazine
portfolio: eight titles were launched, among them Grazia, a new
weekly glossy for the Russian market together with Mondadori, and
seven divested or discontinued.
Net sales in Sanoma Magazines Belgium grew to EUR 108.3 (92.9)
million, partly due to new niche publishing operations acquired in
September 2006. Both advertising and circulation sales increased.
Especially single copy sales grew. In the comparable period, net
sales were negatively influenced by single copy distribution
problems. Sanoma Magazines Belgium launched Milo, a 40+ magazine in
January, and in May it announced the acquisition of a 50% share in
the TV production company Jok Foe NV and the launch of a new magazine
related to TV celebrity Goedele Liekens.
Sanoma Magazines Finland's net sales increased to EUR 98.7 (92.8)
million. Both advertising and circulation sales grew. Subscription
sales performed especially well. Sanoma Magazines Finland's titles
have succeeded in continuously increasing their circulation.
In January-June, Sanoma Magazines' operating profit improved
significantly and amounted to EUR 93.4 (58.6) million. The result
included EUR 21.2 (0.0) million of major non-recurring capital gains
related to the selling of puzzle magazines and other titles. In the
comparable period, an adjustment of EUR 2.0 million related to the
acquisition in 2001 and the terms and conditions of the agreement
improved the result.
Sanoma Magazines Netherlands' operating profit improved
significantly, mainly due to sales gains. Moderate cost development
also improved the result. Sanoma Magazines International's results
increased, given strong sales development and the different timing of
marketing activities to that in the comparable period. Sanoma
Magazines Belgium's result improved markedly due to growth in single
copy sales and the niche publishing activities acquired in September
2006. In the comparable period, single copy distribution problems
decreased the result. Sanoma Magazines Finland's operating profit
grew mainly due to good sales development, with timing differences in
marketing campaigns also having a positive effect.
Sanoma Magazines continues to develop its online businesses and
invest in growth, which is expected to be most rapid in Russia and
the CEE countries. Intense competition in both the advertising and
readers markets in the Netherlands is expected to continue.
Advertising growth is strongest in the online market, where Sanoma
Magazines already has a strong position.
In 2007, Sanoma Magazines' net sales are estimated to grow, and
operating profit excluding major non-recurring capital gains is
expected to improve.
Sanoma
Sanoma is the leading newspaper publisher in Finland. In addition to
Helsingin Sanomat, the largest daily in the Nordic region, the
Division publishes national and regional daily newspapers, local
papers, free sheets, and offers digital services.
- The result continued to improve
- Advertising sales grew faster than the market, with Sanoma
Kaupunkilehdet, Ilta-Sanomat and Sanoma Lehtimedia delivering
particularly solid growth
- Growth in online advertising sales continued to be strong
KEY INDICATORS 4-6/ 4-6/ Change 1-6/ 1-6/ Change 1-12/
EUR million 2007 2006 % 2007 2006 % 2006
Net sales 119.8 113.8 5.2 242.2 226.4 6.9 457.1
Operating profit 17.3 15.0 15.2 36.8 31.1 18.4 62.7
% of net sales 14.4 13.2 15.2 13.7 13.7
Operating profit 17.3 15.0 15.2 36.8 29.5 25.1 61.0
excluding major
non-recurring capital
gains
% of net sales 14.4 13.2 15.2 13.0 13.3
Balance sheet total 514.4 491.3 4.7 526.6
Capital expenditure 9.2 8.2 12.8 16.5
Personnel under 2,679 2,650 1.1 2,672
employment contract,
average
Personnel, average 2,384 2,356 1.2 2,378
(full-time equivalents)
OPERATIONAL INDICATORS
ADVERTISING VOLUME, COLUMN KM 1-6/2007 1-6/2006
Helsingin Sanomat 21.3 20.7
Ilta-Sanomat 3.6 3.5
Free sheets 19.5 16.2
Distribution, free sheets, million copies 55.9 47.6
AUDITED CIRCULATION 1-12/2006 1-12/2005
Helsingin Sanomat 426,117 430,785
Ilta-Sanomat 186,462 195,673
ONLINE SERVICES, UNIQUE VISITORS, WEEKLY 4-6/2007 4-6/2006
Iltasanomat.fi 889,873 757,520
HS.fi 703,245 561,277
Huuto.net 411,957 364,442
Oikotie.fi 302,816 234,734
Taloussanomat.fi 178,907 60,898
Keltainenpörssi.fi 130,161 102,611
In January-June, Sanoma's net sales increased by 6.9%, totalling EUR
242.2 (226.4) million. Net sales were strengthened by the significant
increase in the advertising sales of Helsingin Sanomat, Ilta-Sanomat,
Sanoma Kaupunkilehdet, Sanoma Lehtimedia and online business. Net
sales adjusted for changes in the Group structure increased by 5.7%.
In January-June, the Division reported an 11% overall improvement in
advertising sales, which accounted for 54% (52%) of net sales.
Circulation sales increased by 2% and accounted for 39% (40%) of
Sanoma's net sales.
Sanoma's reporting structure has been modified to better reflect the
focus of operations. The comparable figures for 2006 have been
adjusted accordingly. With effect from 2007, Sanoma's reporting
businesses include Helsingin Sanomat, Ilta-Sanomat, other publishing
and other operations, which include Sanoma's ICT and printing
operations.
The Helsingin Sanomat business unit increased its net sales to EUR
140.3 (133.0) million in January-June. Advertising sales were up
considerably. The biggest increases were in job advertising, 23%,
real estate advertising, 10%, and online advertising, 29%. The
circulation sales of Helsingin Sanomat also increased slightly. In
April, the business unit increased its holding in Skillnet Oy, a
supplier of online recruitment systems, to 51%, further strengthening
Helsingin Sanomat's and Oikotie.fi's market leadership in job
advertising. The total ownership of Skillnet will be gradually
transferred to Helsingin Sanomat.
The Ilta-Sanomat business unit increased its net sales to EUR 48.3
(45.6) million. The unit's advertising and newsstand sales were up
considerably. Ilta-Sanomat commanded a 57.7% (58.9%) share of the
tabloid market. Ilta-Sanomat, which is celebrating its 75th
Anniversary, revised its weekend supplement and online service in
March, and the number of website visitors has shown a steady
increase. In May, Tapio Sadeoja was appointed Senior Editor-in-Chief
of the paper. The position of classified advertising was strengthened
in the spring through, for example, the acquisition of a 20% share in
Auto24, the leading online marketplace for used and new cars in
Estonia.
Net sales from other publishing increased to EUR 48.8 (42.3) million.
The growth of advertising sales was particularly strong in the Sanoma
Lehtimedia and Sanoma Kaupunkilehdet business units. The sales of
Esmerk's business information services also developed well. The
number of free sheets increased from the comparable period with the
acquisition in September 2006 of the Finnish operations of the Metro
free sheet. In June, the youth-oriented free sheet V became a weekly
supplement to the Metro. Also in June, MBNet's price tracking service
was transferred to Sanoma Digital. Sanoma Digital, a new company
focusing on online business, was established on 1 January 2007.
Net sales from other operations, mainly comprising internal services,
were up to EUR 76.4 (73.9) million, largely due to new print
customers.
In January-June, Sanoma's operating profit increased clearly to EUR
36.8 (31.1) million. The operating profit for the comparable period
included a total of EUR 1.7 million in major non-recurring capital
gains. Helsingin Sanomat increased its operating profit considerably
due to the growth of advertising revenues. The substantial
improvement in the earnings of Ilta-Sanomat was due to both increased
advertising and newsstand sales. Other publishing also clearly
increased its operating profits, excluding capital gains, with all
units improving their earnings. Earnings from other operations were
down slightly.
Sanoma is seeking growth in, for example, new businesses. At the same
time, the positive development of media advertising and the growth of
newsstand sales are expected to continue during the current fiscal
year.
In 2007, Sanoma's net sales are estimated to increase and operating
profit excluding major non-recurring capital gains is expected to
improve.
SanomaWSOY education and Books
SanomaWSOY Education and Books is a significant European educational
publisher with operations in the Netherlands, Finland, Hungary,
Belgium and Poland. The Division is also Finland's leading book
publisher and active in business information and services.
- Educational publishing expands; Polish educational publisher Nowa
Era acquired after the review period
- Timing and structural differences in sales of educational
publishing
KEY INDICATORS 4-6/ 4-6/ Change 1-6/ 1-6/ Change 1-12/
EUR million 2007 2006 % 2007 2006 % 2006
Net sales 104.8 97.2 7.9 157.0 142.5 10.2 309.2
Operating profit 29.8 33.8 -11.8 23.3 29.5 -21.0 48.0
% of net sales 28.4 34.8 14.8 20.7 15.5
Operating profit excluding 29.8 33.8 -11.8 23.3 29.5 -21.0 48.0
major non-recurring
capital gains
% of net sales 28.4 34.8 14.8 20.7 15.5
Balance sheet total 638.2 566.0 12.8 598.2
Capital expenditure 2.9 5.3 -44.2 8.9
Personnel under employment 2,748 2,197 25.1 2,455
contract, average
Personnel, average 2,333 1,922 21.4 2,106
(full-time equivalents)
OPERATIONAL INDICATORS 1-6/2007 1-6/2006
EDUCATIONAL
Number of new titles published, books 620 495
Number of new titles published, electronic products 171 138
PUBLISHING
Number of new titles published, books 250 246
Number of new titles published, electronic products 30 51
Number of copies sold, published books 10.5 8.1
In January-June, SanomaWSOY Education and Books' net sales increased
by 10.2% and totalled EUR 157.0 (142.5) million. Net sales increased
in educational publishing and in business information and services. A
total of 56% (52%) of the Division's net sales came from outside
Finland. Net sales adjusted for changes in the Group structure
increased by 1.4%.
Educational publishing's net sales amounted to EUR 98.4 (85.0)
million. Sales developed positively in the Netherlands, where
operations were also complemented with the acquisition of educational
consultancy company TSM Consultants in June. The Hungarian
educational publisher Láng became part of SanomaWSOY Education in
June 2006 and as a result contributed in increased sales of the
educational publishing business. The remaining shares were acquired
in April 2007. Sales in Poland exceeded the comparable period due to
timing differences in invoicing. Belgian sales were in line with the
previous year, but Finnish net sales decreased. After the review
period, educational publishing operations were further expanded with
the acquisition of Polish publisher Nowa Era and its subsidiaries.
The acquisition is subject to the approval of Polish antitrust
officials.
Net sales in publishing totalled EUR 47.1 (46.2) million in the first
half of the year. Net sales of general literature were slightly
behind those of the comparable period. Growth in publishing came from
business information and services, where language services performed
especially well. Language service provider AAC Global, acquired in
February 2006, expanded its operations in March 2007 by the
acquisition of Translation Services Noodi in Finland.
Net sales from other operations, mainly printing, totalled EUR 22.9
(20.1) million. Net sales of other operations are partly affected by
the seasonality of both publishing and educational publishing.
The Division's operating profit in January-June was EUR 23.3 (29.5)
million. The decrease is partly attributable to the seasonal nature
of the educational publishing business. Operating profit in
educational publishing was below that of the comparable period. The
shift in the timing of deliveries and structural changes in sales
especially affected the result. Decreased results in other operations
and publishing were due to sluggish book sales.
SanomaWSOY Education and Books continues to develop its three main
businesses with the focus on internationalising educational
publishing, maintaining Finnish market leadership in general
literature publishing and expanding business information and
services, especially in the language services market.
In 2007, net sales of SanomaWSOY Education and Books are estimated to
increase, and operating profit excluding major non-recurring capital
gains is expected to improve. This estimate does not include the
impact of Nowa Era acquisition.
SWelcom
Commercial TV channel Nelonen, part of the electronic media division
SWelcom is Finland's third largest medium in terms of advertising
sales, while Welho is the country's largest cable television company
and a major provider of broadband services.
- SWelcom becomes majority shareholder of TV channel Urheilukanava
- Radio Rock now market leader in its target group; the new TV
channel JIM has also reached its target demographic excellently
- Welho launched Video on Demand service in May
KEY INDICATORS 4-6/ 4-6/ Change 1-6/ 1-6/ Change 1-12/
EUR million 2007 2006 % 2007 2006 % 2006
Net sales 35.4 34.1 3.8 70.6 67.4 4.7 131.8
Operating profit 4.0 4.0 -0.4 6.9 7.2 -4.6 12.5
% of net sales 11.3 11.7 9.8 10.7 9.5
Operating profit excluding 4.0 4.0 -0.4 6.9 7.2 -4.6 12.5
major non-recurring capital
gains
% of net sales 11.3 11.7 9.8 10.7 9.5
Balance sheet total 164.5 148.3 10.9 158.6
Capital expenditure 7.4 3.9 89.7 15.2
Personnel under employment 473 438 8.1 437
contract, average
Personnel, average 438 397 10.2 398
(full-time equivalents)
OPERATIONAL INDICATORS 1-6/2007 1-6/2006
Nelonen's and JIM's share of Finnish TV advertising 29.5% 31.9%
Nelonen's and JIM's daily reach 41% 43%
Nelonen's and JIM's national commercial viewing 23.7% 25.6%
share
Nelonen's and JIM's national viewing share 11.3% 12.1%
Number of connected households, thousands (30.6) 312 298
Number of pay TV subscriptions, thousands (30.6) 70 44
Number of broadband internet connections, thousands 93 75
(30.6)
SWelcom's net sales for January-June increased by 4.7%, totalling EUR
70.6 (67.4) million. This increase was primarily due to the growth of
Welho's net sales. Net sales adjusted for changes in the Group
structure increased by 7.9%. Advertising sales represented 57% (60%)
of SWelcom's net sales.
Net sales from TV and radio operations for January-June were EUR 40.4
(40.2) million. The combined share of all television advertising of
the Nelonen and JIM channels dropped to 29.5% (31.9%) as Nelonen's
viewing shares declined due to the fragmentation of viewing across an
increasing number of channels. Nelonen's viewing shares are expected
to increase as a result of programme investments in the autumn.
Radio Rock and Radio Aalto reached a total of over one million
listeners each week, and SWelcom became the third largest commercial
radio operator in Finland. Radio Rock is the market leader in its
target group of 20-44 year old males.
Welho's net sales increased strongly as a result of the rapid growth
in pay TV, broadband subscriptions and the sale of digital set-top
boxes. In May, Welho launched the Welho Play Video on Demand (VOD)
service, which allows Welho broadband subscribers to download films
and TV programmes onto their computers whenever they want. In
addition, Welho has launched an IPTV service in the Helsinki
metropolitan area, bringing Welho's TV services to customers outside
the cable network.
In January-June, SWelcom's operating profit was EUR 6.9 (7.2)
million. Operating profit was negatively impacted by the investments
required by the television and radio channels launched in early 2007.
SWelcom will become the majority shareholder in the Urheilukanava
sports channel and the pay TV sports channel Urheilu+kanava, since
the Finnish Government approved the continuation of the broadcasting
licences of the two channels in view of the change in ownership in
July.
SWelcom continues the development of its digital content and media
solutions business, as well as its online community services. SWelcom
is also preparing to launch a nationwide pay TV channel with a focus
on television series and movies. This channel will be launched in
autumn 2007.
SWelcom's net sales are estimated to increase further in 2007.
Operating profit excluding major non-recurring capital gains is
expected to improve slightly despite the considerable investments in
development. This estimate does not include the impact of the
Urheilukanava deal.
Rautakirja
Rautakirja is the market leader in kiosk operations, press
distribution and movie theatres in Finland and the Baltic countries,
and press distribution in Romania. Additionally, it leads the Finnish
and Estonian markets for bookstores and, from the beginning of 2007,
also the Dutch market for press distribution. Its press distribution
business and kiosk operations have also expanded into the Russian
market.
- Net sales grew across all businesses
- Strong summer season for movie theatres in Finland and the Baltics
- First kiosks opened in Moscow
KEY INDICATORS 4-6/ 4-6/ Change 1-6/ 1-6/ Change 1-12/
EUR million 2007 2006 % 2007 2006 % 2006
Net sales 201.3 186.8 7.8 393.7 367.5 7.1 799.9
Operating profit 10.6 8.1 30.2 19.5 18.5 5.7 54.7
% of net sales 5.2 4.3 5.0 5.0 6.8
Operating profit 10.6 8.1 30.2 19.5 18.5 5.7 54.7
excluding major
non-recurring capital
gains
% of net sales 5.2 4.3 5.0 5.0 6.8
Balance sheet total 548.1 500.4 9.5 586.9
Capital expenditure 11.9 8.0 48.1 23.1
Personnel under 7,750 7,461 3.9 7,496
employment contract,
average
Personnel, average 6,247 5,856 6.7 5,932
(full-time equivalents)
OPERATIONAL INDICATORS 1-6/2007 1-6/2006
Customer volume in kiosk operations, thousands 103,932 101,766
Customer volume in bookstores, thousands 3,139 2,985
Customer volume in movie theatres, thousands 4,527 3,692
Number of copies sold (press distribution), 191,794 182,960
thousands
In January-June, Rautakirja's net sales increased by 7.1%, totalling
EUR 393.7 (367.5) million. Net sales grew across all markets and
businesses. Net sales adjusted for changes in the Group structure
increased by 5.2%. Of Rautakirja's net sales, 34% (33%) came from
outside Finland. The Dutch press distribution company Aldipress was
combined with Rautakirja on 1 January 2007. The comparable figures
have been adjusted to reflect the inclusion of Aldipress.
Net sales from kiosk operations increased in all countries of
operation, rising to EUR 186.2 (176.6) million. Customer numbers also
increased across all markets. Net sales for the comparable period
include the net sales of the Pizza Hut restaurant chain, which was
divested in June 2006. In Finnish R-kiosks, traditional kiosk
products, mobile communications and travel tickets generated the most
positive results. R-kiosks launched several new service products in,
for example, the field of mobile communications. In March, Rautakirja
expanded its kiosk operations to Russia by establishing a joint
venture with the Russian Partner Service Group. Rautakirja holds a
70% majority share in the new company. The first kiosks in Moscow
opened their doors in June.
Press distribution increased its net sales to EUR 117.2 (108.3)
million in January-June. Net sales increased in Finland, Russia, the
Baltic countries and Romania. The growth was particularly strong in
the Baltic countries and Romania. The Dutch newsstand market has been
challenging for quite some time, and the distribution volumes of
Aldipress decreased somewhat from the comparable period. In Finland,
press distribution sales have especially been bolstered by the
weekday cover price increase by quality tabloids. Finnish press
product sales promotions will be developed with the assistance of
Printcenter, a company specialised in point-of-sale (POS) marketing
acquired in February.
The net sales of bookstores were EUR 52.7 (52.7) million. Finnish
in-store sales did well, but net sales were slightly below the
comparable period, which included the library business sold in the
autumn 2006. Net sales increased in Estonia. A new store was opened
in Pärnu in May.
Net sales from the entertainment business increased in all countries
of operation, rising to EUR 45.4 (35.7) million. Movie theatre
audiences increased clearly in Finland, Latvia and Lithuania. In
addition to the good selection of movies, the growth has been
particularly boosted by new operations: Finnish operations were
expanded through acquisitions and by the opening of additional new
multiplexes during the second half of 2006, and another new multiplex
was opened in Lithuania this April.
Rautakirja's operating profit for January-June was EUR 19.5 (18.5)
million. Kiosk operations and the entertainment business improved
their performance clearly, particularly in the second quarter. The
operating profit of press distribution was slightly below the
comparable period. Bookstores' operating profit was down due to, for
example, a decline in subscription sales in the first half of the
year.
In addition to the home markets of Finland and the Baltic countries,
Rautakirja's expansion and development efforts will also focus on the
emerging economies of Russia and Central Eastern Europe.
In 2007, Rautakirja's net sales are expected to grow and operating
profit excluding major non-recurring capital gains is expected to be
at the previous year's level.
This Interim Report is unaudited. Definitions of key indicators are
presented in SanomaWSOY's Financial Statements 2006.
Helsinki
Board of Directors
SanomaWSOY Corporation
Consolidated Financial Statements (unaudited)
CONSOLIDATED INCOME STATEMENT
EUR million 1-6/2007 1-6/2006 Change % 1-12/2006
NET SALES 1,408.0 1,311.7 7.3 2,742.1
Other operating income 62.3 28.2 120.7 57.2
Materials and services 622.0 587.5 5.9 1,243.3
Personnel expenses 320.5 294.4 8.9 595.5
Other operating expenses 268.9 254.7 5.6 532.2
Depreciation and impairment 72.0 65.0 10.7 135.8
losses
OPERATING PROFIT 186.9 138.4 35.1 292.5
Share of result of associated 4.5 4.2 7.7 8.4
companies
Financial items -16.7 -13.7 21.9 -24.5
RESULT BEFORE TAXES 174.8 128.9 35.6 276.3
Income taxes -44.3 -37.7 17.7 -68.0
RESULT FOR THE PERIOD 130.4 91.2 43.0 208.4
Attributable to:
Equity holders of the Parent 131.3 94.7 38.7 209.5
Company
Minority interest -0.9 -3.4 -74.0 -1.1
Earnings per share for result
attributable to the equity holders of the
Parent Company:
Earnings per share, EUR 0.80 0.60 32.5 1.32
Diluted earnings per share, 0.79 0.59 33.7 1.31
EUR
CONSOLIDATED BALANCE SHEET
EUR million 30.6.2007 30.6.2006 Change % 31.12.2006
ASSETS
NON-CURRENT ASSETS
Tangible assets 566.8 559.5 1.3 572.3
Investment property 9.5 10.8 -11.3 10.0
Goodwill 1,414.6 1,359.3 4.1 1,392.7
Other intangible assets 380.1 311.6 22.0 368.1
Interest in associated 70.0 64.7 8.3 68.2
companies
Available-for-sale financial 16.3 15.9 2.5 16.4
assets
Deferred tax receivables 53.5 54.2 -1.3 45.2
Trade and other receivables 38.4 36.2 6.3 38.4
NON-CURRENT ASSETS, TOTAL 2,549.4 2,412.2 5.7 2,511.3
CURRENT ASSETS
Inventories 170.9 153.1 11.6 150.1
Receivables 446.4 396.1 12.7 389.3
Available-for-sale financial 0.6 -100.0
assets
Cash and cash equivalents 89.9 75.8 18.6 81.5
CURRENT ASSETS, TOTAL 707.2 625.6 13.0 620.9
ASSETS, TOTAL 3,256.6 3,037.7 7.2 3,132.2
EQUITY AND LIABILITIES
EQUITY
Equity attributable to the equity
holders of the Parent Company
Share capital 71.1 68.5 3.7 70.9
Other equity 1,216.7 1,021.0 19.2 1,234.8
1,287.8 1,089.5 18.2 1,305.7
Minority interest 13.8 14.0 -1.1 17.0
EQUITY, TOTAL 1,301.6 1,103.5 18.0 1,322.7
NON-CURRENT LIABILITIES
Deferred tax liabilities 105.0 89.6 17.2 96.2
Pension obligations 55.2 64.9 -14.9 57.6
Provisions 8.0 11.2 -29.1 7.8
Interest-bearing 40.9 130.1 -68.6 44.2
liabilities
Other liabilities 34.5 30.9 11.3 36.0
CURRENT LIABILITIES
Provisions 9.4 10.3 -8.6 7.9
Interest-bearing 979.8 938.9 4.4 819.7
liabilities
Other liabilities 722.3 658.4 9.7 740.1
LIABILITIES, TOTAL 1,955.0 1,934.2 1.1 1,809.5
EQUITY AND LIABILITIES, 3,256.6 3,037.7 7.2 3,132.2
TOTAL
CHANGES IN CONSOLIDATED EQUITY
EUR million Equity attributable to the
equity holders of the Parent
Company
Share capital Other Minority Equity,
equity interest total
EQUITY AT 31 DEC. 2005 67.5 1,074.0 16.3 1,157.7
Change in translation -9.6 -0.3 -9.9
differences
Other items -0.6 -0.6
Items recognised -10.2 -0.3 -10.5
directly in equity,
total
Profit for the period 94.7 -3.4 91.2
TOTAL RECOGNISED INCOME 84.4 -3.8 80.7
AND EXPENSES
Directed issue of 1.0 1.0
shares
Conversion of capital
notes
Usage of share options 0.1 1.2 1.2
Expense recognition of 2.7 2.7
granted options
Dividends paid -141.3 -1.3 -142.6
Change in minority 2.8 2.8
interests
EQUITY AT 30 JUN. 2006 68.5 1,021.0 14.0 1,103.5
EQUITY AT 1 JAN. 2007 70.9 1,234.8 17.0 1,322.7
Change in translation 1.6 0.2 1.8
differences
Other items -0.2 -0.2
Items recognised 1.4 0.2 1.6
directly in equity,
total
Profit for the period 131.3 -0.9 130.4
TOTAL RECOGNISED INCOME 132.8 -0.7 132.0
AND EXPENSES
Conversion of capital 0.0 1.7 1.7
notes
Usage of share options 0.1 1.4 1.4
Expense recognition of 2.8 2.8
granted options
Dividends paid -156.7 -2.1 -158.9
Change in minority -0.2 -0.2
interests
EQUITY AT 30 JUN. 2007 71.1 1,216.7 13.8 1,301.6
CONSOLIDATED CASH FLOW STATEMENT
EUR million 1-6/2007 1-6/2006 Change % 1-12/2006
OPERATIONS
Result for the period 130.4 91.2 43.0 208.4
Adjustments 71.3 85.6 -16.7 158.1
Change in working capital -87.2 -76.6 13.8 4.9
Financial items and taxes -72.6 -60.8 19.5 -111.5
CASH FLOW FROM OPERATIONS 41.9 39.4 6.1 259.9
INVESTMENTS
Acquisition of tangible and -42.3 -34.5 22.6 -81.2
intangible assets
Operations acquired -29.7 -28.2 6.5 -91.2
Sales of tangible and intangible 20.2 3.9 424.9 11.9
assets
Operations sold 21.1 20.4 3.2 23.8
Loans granted -5.7 -10.3 -45.0 -9.5
Repayments of loan receivables 3.6 3.4 6.1 3.4
Other cash flow from investments 8.6 5.3 61.0 9.9
CASH FLOW FROM INVESTMENTS -24.2 -40.1 -39.5 -132.9
CASH FLOW BEFORE FINANCING 17.6 -0.6 127.0
FINANCING
Proceeds from share 1.4 2.2 -34.7 2.8
subscriptions
Change in loans with short 18.1 39.6 -54.2 7.1
maturity
Drawings of other loans 152.9 109.1 40.1 328.3
Repayments of other loans -23.4 -15.8 48.2 -329.1
Dividends paid -158.9 -142.6 11.4 -142.7
Other cash flow from financing -2.2 -1.2 88.6 -2.3
CASH FLOW FROM FINANCING -12.0 -8.6 38.9 -136.0
CHANGE IN CASH AND CASH 5.6 -9.3 -8.9
EQUIVALENTS ACCORDING TO THE
CASH FLOW STATEMENT
Exchange rate differences under 0.4 -3.1 1.1
cash and cash equivalents
NET CHANGE IN CASH AND CASH 6.0 -12.4 -7.8
EQUIVALENTS
Cash and cash equivalents at 1 77.1 84.9 -9.2 84.9
Jan.
Cash and cash equivalents at 30 83.0 72.5 14.5 77.1
Jun. / 31 Dec.
Accounting policies
SanomaWSOY has prepared its Interim Report in accordance with IAS 34
standard while adhering to related standards and interpretations
applicable within the EU.
SanomaWSOY applies all the standards, amendments to standards and
interpretations, that took effect at 1 January 2007. These have no
material effect on consolidated financial statements.
NET SALES BY BUSINESS
EUR million 1-3/ 4-6/ 1-3/ 4-6/ 7-9/ 10-12/ 1-12/
2007 2007 2006 2006 2006 2006 2006
SANOMA MAGAZINES
Sanoma Magazines 119.8 136.6 116.7 138.7 127.4 148.3 531.2
Netherlands
Sanoma Magazines 65.8 68.5 58.1 59.7 57.9 71.9 247.6
International
Sanoma Magazines Belgium 52.5 55.8 44.7 48.2 43.8 51.9 188.6
Sanoma Magazines Finland 50.1 48.6 45.8 47.1 47.3 53.1 193.2
Eliminations -1.2 -1.2 -1.2 -1.3 -1.2 -0.9 -4.7
TOTAL 287.1 308.2 264.1 292.3 275.2 324.3 1,155.9
SANOMA
Helsingin Sanomat 72.3 68.0 66.8 66.2 62.9 71.4 267.3
Ilta-Sanomat 23.6 24.6 22.3 23.4 22.8 23.7 92.2
Other publishing 24.3 24.6 20.8 21.4 20.2 24.8 87.3
Others 38.5 38.0 37.5 36.5 34.9 36.8 145.6
Eliminations -36.3 -35.4 -34.8 -33.6 -32.5 -34.2 -135.2
TOTAL 122.4 119.8 112.6 113.8 108.2 122.4 457.1
SANOMAWSOY EDUCATION
AND BOOKS
Educational publishing 20.0 78.5 15.3 69.7 77.3 25.4 187.7
Publishing 26.3 20.8 24.2 22.1 19.0 30.7 96.0
Others 12.0 11.0 10.3 9.7 11.3 12.0 43.3
Eliminations -6.0 -5.4 -4.5 -4.3 -4.3 -4.7 -17.8
TOTAL 52.2 104.8 45.4 97.2 103.3 63.4 309.2
SWELCOM
TV and radio 20.1 20.3 19.2 21.0 13.4 22.8 76.5
Others 15.4 15.2 14.3 13.2 14.0 14.6 56.0
Eliminations -0.3 -0.1 -0.2 -0.1 -0.2 -0.1 -0.6
TOTAL 35.2 35.4 33.3 34.1 27.2 37.2 131.8
RAUTAKIRJA
Kiosk operations 86.9 99.3 82.3 94.4 91.4 101.0 369.1
Press distribution 56.2 61.0 50.7 57.5 56.6 58.7 223.6
Bookstores 29.6 23.1 30.2 22.5 37.2 49.0 138.9
Entertainment 23.5 22.0 20.1 15.7 18.0 28.0 81.7
Eliminations -3.9 -4.0 -2.6 -3.2 -3.6 -3.9 -13.4
TOTAL 192.4 201.3 180.7 186.8 199.6 232.9 799.9
Other companies and -25.6 -25.1 -23.6 -25.1 -25.3 -37.9 -111.9
eliminations
TOTAL 663.7 744.4 612.5 699.2 688.2 742.2 2,742.1
OPERATING PROFIT BY DIVISION
EUR million 1-3/ 4-6/ 1-3/ 4-6/ 7-9/ 10-12/ 1-12/
2007 2007 2006 2006 2006 2006 2006
Sanoma Magazines 32.1 61.3 23.3 35.3 28.2 41.9 128.8
Sanoma 19.6 17.3 16.1 15.0 15.0 16.5 62.7
SanomaWSOY Education -6.5 29.8 -4.3 33.8 25.6 -7.1 48.0
and Books
SWelcom 2.9 4.0 3.2 4.0 0.4 4.8 12.5
Rautakirja 9.0 10.6 10.4 8.1 13.7 22.5 54.7
Other companies and -3.1 10.1 -3.1 -3.4 -2.9 -4.7 -14.1
eliminations
TOTAL 54.0 133.0 45.6 92.8 80.1 73.9 292.5
CHANGES IN PROPERTY, PLANT AND EQUIPMENT
EUR million 30.6.2007 30.6.2006 Change % 31.12.2006
Carrying amount at 1 Jan. 572.3 566.5 1.0 566.5
Increases 29.3 20.6 42.7 59.4
Acquisition of operations 0.7 4.5 -84.2 15.5
Decreases -1.7 -0.7 148.7 -5.3
Disposals of operations -0.8 -0.4 79.8 -2.3
Depreciation for the -32.7 -30.8 6.1 -62.9
period
Impairment losses for the 0.0 0.0 -81.6 -0.2
period
Exchange rate differences -0.3 -0.1 315.5 1.6
and other changes
Carrying amount at 30 566.8 559.5 1.3 572.3
Jun. / 31 Dec.
The commitments for acquisitions of tangible assets were EUR 6.3
million (2006: EUR 10.9 million).
CONTINGENT LIABILITIES
EUR million 30.6.2007 30.6.2006 Change % 31.12.2006
CONTINGENCIES FOR OWN
COMMITMENTS
Mortgages 9.8 9.6 1.3 10.5
Pledges 18.7 10.8 72.6 18.4
Other items 0.4 0.9 -54.5 0.4
TOTAL 28.9 21.4 34.9 29.4
CONTINGENCIES GIVEN ON BEHALF
OF ASSOCIATED COMPANIES
Guarantees 7.9 7.9 7.9
TOTAL 7.9 7.9 7.9
CONTINGENCIES GIVEN ON BEHALF
OF OTHER COMPANIES
Guarantees 0.1 0.2 -15.5 0.1
TOTAL 0.1 0.2 -15.5 0.1
CONTINGENCIES GIVEN ON BEHALF
OF OTHER COMPANIES
Operating lease liabilities 256.7 238.3 7.7 249.1
Royalties 22.5 18.1 24.5 15.9
Other 49.5 42.1 17.8 47.2
TOTAL 328.7 298.5 10.1 312.2
CONTINGENT LIABILITIES, TOTAL 365.7 328.0 11.5 349.6
DERIVATIVE INSTRUMENTS
NOMINAL VALUES, EUR million 30.6.2007 30.6.2006 Change % 31.12.2006
INTEREST RATE DERIVATIVES
Options
Purchased 100.0 -100.0
Written 54.8 -100.0
TOTAL 154.8 -100.0
FAIR VALUES, EUR MILLION 30.6.2007 30.6.2006 Change % 31.12.2006
INTEREST RATE DERIVATIVES
Options
Purchased 0,0
Written -0,0 -100.0
TOTAL 0.0 -100.0
CONSOLIDATED INCOME STATEMENT BY QUARTER
EUR million 1-3/ 4-6/ 1-3/ 4-6/ 7-9/ 10-12/ 1-12/
2007 2007 2006 2006 2006 2006 2006
NET SALES 663.7 744.4 612.5 699.2 688.2 742.2 2,742.1
Other operating income 13.3 49.0 15.4 12.8 13.8 15.2 57.2
Materials and services 294.9 327.1 280.9 306.6 322.0 333.8 1,243.3
Personnel expenses 158.4 162.2 145.6 148.7 142.0 159.1 595.5
Other operating expenses 135.0 133.9 124.8 129.8 124.3 153.3 532.2
Depreciation and 34.6 37.3 30.9 34.0 33.5 37.3 135.8
impairment losses
OPERATING PROFIT 54.0 133.0 45.6 92.8 80.1 73.9 292.5
Share of result of 1.8 2.7 1.9 2.3 3.4 0.8 8.4
associated companies
Financial items -7.1 -9.6 -6.2 -7.5 -6.1 -4.7 -24.5
RESULT BEFORE TAXES 48.6 126.1 41.3 87.6 77.4 70.1 276.3
Income taxes -13.7 -30.6 -12.4 -25.3 -18.2 -12.1 -68.0
RESULT FOR THE PERIOD 34.9 95.5 28.9 62.3 59.2 58.0 208.4
Attributable to:
Equity holders of the 35.5 95.8 32.5 62.2 57.2 57.6 209.5
Parent Company
Minority interest -0.6 -0.3 -3.6 0.1 2.0 0.4 -1.1
Press Conference
Press and analyst meeting in Finnish will be held by Mr Hannu
Syrjänen, President and CEO of SanomaWSOY at 1.30 pm GMT+3 at
Sanomatalo, Töölönlahdenkatu 2, Helsinki.
The conference call in English for analysts and investors will be
arranged at 3.30 pm GMT+3. Mr Hannu Syrjänen will present the result.
To join the conference, please dial +44 20 3003 2666 (Europe) or +1
866 966 5335 (US). The code for the call is SanomaWSOY.
The event can also be viewed on web at www.sanomawsoy.fi either live
or later on as on demand.
The presentation material of the press and analyst meeting as well as
the slides used in the conference call will be available on
SanomaWSOY's website after the press and analyst meeting has started.
SANOMAWSOY CORPORATION
Matti Salmi
Senior Vice President
Finance and Administration
Further information: SanomaWSOY's IR & Group Communications, tel.
+358 105 19 5062 or ir@sanomawsoy.fi
SanomaWSOY is the leading media group in the Nordic region operating
in versatile fields of media in over 20 European countries. The Group
has five divisions: Sanoma Magazines, Sanoma, SanomaWSOY Education
and Books, SWelcom, and Rautakirja. In 2006, the Group employed over
18,000 people and its net sales were some EUR 2.7 billion.
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