Alma Media - Interim report (Q1 and Q3)

Alma Media’s Interim Report January–March 2017: Strong first quarter, growth in revenue and operating profit

Alma Media Corporation       Interim Report       28 April 2017 at 9:00 a.m.
(EEST)

Alma Media’s Interim Report January–March 2017:

STRONG FIRST QUARTER, GROWTH IN REVENUE AND OPERATING PROFIT

Financial performance January–March 2017:

  · Revenue MEUR 90.5 (86.7), up 4.4%.
  · Adjusted operating profit MEUR 12.6 (5.5), or 13.9% (6.4%) of revenue, up
128.3%.
  · Operating profit MEUR 11.4 (2.5), or 12.6% (2.9%) of revenue, up 358.1%.
  · Earnings per share EUR 0.09 (0.01).
  · Alma Markets: Profitable growth continued in both domestic and international
operations.
  · Alma Talent: Operating profit improved due to restructuring measures
implemented last year.
  · Alma News & Life: Profitability was weighed down by a decline in the single
-copy sales of print media.
  · Alma Regions: Profitability was improved by cost savings, election
advertising and the external sales of printing services.



KEY FIGURES                                2017   2016   Change   2016
MEUR                                       Q1     Q1     %        Q1–Q4
Revenue                                    90.5   86.7   4.4      353.2
Content revenue *)                         32.1   32.4   -1.0     128.3
Content revenue, print                     28.0   29.1   -3.6     113.5
Content revenue, online                    4.1    3.4    21.1     14.8
Advertising revenue                        43.8   40.4   8.6      169.7
Advertising revenue, print                 15.7   16.4   -4.4     68.5
Advertising revenue, online                27.9   24.0   16.3     101.3
Service revenue *)                         14.6   13.9   4.9      55.2
Adjusted total expenses                    78.0   81.5   -4.2     318.9
Adjusted EBITDA                            16.6   9.9    67.0     53.3
EBITDA                                     15.4   6.9    122.9    47.9
Adjusted operating profit                  12.6   5.5    128.3    35.2
% of revenue                               13.9   6.4             10.0
Operating profit/loss                      11.4   2.5    358.1    26.8
% of revenue                               12.6   2.9             7.6
Profit for the period                      8.9    1.6    452.3    19.9
Earnings per share, EUR
(undiluted and basic)                      0.09   0.01   935.4    0.20

Online sales                               37.0   31.3   18.2     133.5
Online sales, % of revenue                 40.9   36.1            37.8

*) Comparison data has been adjusted between content revenue and service revenue

Outlook for 2017

The Finnish economy is expected to grow by 1–2% in 2017. Alma Media’s
significant operating countries in Eastern Central Europe, such as the Czech
Republic and Slovakia, are expected to see economic growth of 2–4%.
Macroeconomic development affects both consumer demand and advertising volume.
The structural transformation of advertising will continue in 2017; online
advertising will grow, while print media advertising will decline.

In 2017, Alma Media expects its full-year revenue to remain at the previous
year’s level and its adjusted operating profit to increase from the 2016 level.
The full-year revenue for 2016 was MEUR 353.2, and the adjusted operating profit
was MEUR 35.2.

Kai Telanne, President and CEO:

Alma Media’s revenue and profitability developed well in the first quarter of
2017. Revenue grew, mostly organically, by 4.4 per cent and amounted to MEUR
90.5. The sources of this growth included the positive performance of Alma
Markets’ digital business and the online advertising of our media in Finland as
well as municipal election advertising and the fact that there were more working
days and publication dates than in the comparison period. The significant
improvement in profitability was mainly attributable to the efficiency
improvement measures implemented in several businesses last year. The Group’s
adjusted operating profit for January–March rose by 128 per cent to MEUR 12.6.

The development of the Finnish economy improved in the first months of the year,
but the signs of growth are not yet reflected in advertising investments.
According to Kantar TNS, media advertising volume declined by 4.7 per cent in
the first quarter. Online advertising, however, rose by 7.4 per cent. Alma
Media’s digital advertising sales outgrew the market due to effective
advertising solutions and new mobile services.

In the Alma Markets segment, revenue growth and strong operating profit
performance were supported by the favourable operating environment for the
recruitment business in Eastern Central Europe as well as the increased activity
in the housing and automotive markets in Finland. The segment’s result was also
improved by lower depreciation.

In the Alma Talent segment, revenue was unchanged from the previous year and the
result improved thanks to restructuring measures related to the integration of
Talentum in the Finnish and Swedish media businesses as well as the cost savings
achieved in Information Services. Alma Talent’s broad-based media portfolio has
been well received by advertisers: the segment’s advertising sales saw positive
development, particularly in online advertising and content marketing. Alma
Talent’s first digital solutions in line with the development projects outlined
in the new strategy were launched in the first quarter.

The structural change and digital transformation of the media industry were most
clearly evident in the Alma News & Life segment: digital advertising sales grew
substantially, particularly in mobile advertising and programmatic buying, but
the single-copy sales of print media continued to decline. Investments in the
service business increased costs.

The Alma Regions segment’s revenue was increased by the external sales of
printing services as well as higher content revenue. The segment’s advertising
revenue declined in spite of election advertising during the review period.
Profitability was improved by the lighter cost structure implemented in the
previous year.

The sustained decline in demand in the Kemi-Tornio region and unprofitable
operations led to the decision to merge Pohjolan Sanomat with Lapin Kansa. The
decision to discontinue the centenarian brand was difficult but unavoidable. Our
aim is to build a single strong regional media brand in the Lapland region, both
in print and as a vital, developing digital media service.

Thanks to a strong position in selected markets paired with stable operating
cash flow and financial position, the conditions are excellent for building Alma
Media’s future. We are continuously looking for new sources of business growth,
mainly in the area of digital services in Finland and elsewhere in Europe.

For more information, please contact:
Kai Telanne, President and CEO, telephone +358 10 665 3500
Juha Nuutinen, CFO, telephone +358 10 665 3873

Conference, webcast and conference call:

A conference for Finnish media, investors and analysts will be held on the same
day at 11.00–12.00 EEST in the Alma House (address: Alvar Aallon katu 3 C,
Helsinki). In addition to the presentations held by President & CEO Kai Telanne
and CFO Juha Nuutinen, participants will have an opportunity to discuss with
other members of the company's management. Please note that the conference will
be held in Finnish. The presentation material in English will be available on
www.almamedia.fi/en/investors/reports-and-presentations/presentations at 11.00
EEST.

To participate in the conference, kindly register beforehand by e-mail,
kutsut@almamedia.fi.

An international conference call and audio webcast concerning the financial
result of January-March 2017 will begin at 13.00 EEST. You can participate in
the conference by calling +44 (0)330 336 9105 (confirmation code: 1988812) or
follow it at http://www.almamedia.fi/en/investors/reports-and
-presentations/presentations.

Alma Media’s financial calendar 2017

Alma Media will publish financial reports in 2017 as follows:

– Interim report for January–June 2017 on Friday, 21 July at approximately 9:00
EEST

– Interim report for January–September 2017 on Friday, 27 October at
approximately 9:00 EEST
Alma Media in brief

Alma Media is a media company focusing on the service business and journalistic
content. The company’s best-known brands are Kauppalehti, Talouselämä,
Affärsvärlden, Iltalehti, Aamulehti, Etuovi.com and Monster. Alma Media builds
sustainable growth for its customers by utilising the opportunities of
digitality, including information services, system and expert services and
advertising solutions. Alma Media’s operations have expanded from Finland to the
Nordic countries, the Baltics and Central Europe. Alma Media employs
approximately 2,300 professionals (excluding delivery personnel), of whom
approximately 30% work outside Finland. Alma Media’s revenue in 2016 was EUR
353.2 million. Alma Media’s share is listed on NASDAQ Helsinki. Read more at
www.almamedia.com.

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