2008-02-13 08:00:00 CET
2008-02-13 08:01:03 CET
REGULATED INFORMATION
Alma Media - Financial Statement Release
Alma Media Financial Statements Bulletin 2007: Net sales increased and operating profit improved; dividend proposal EUR 0.90
ALMA MEDIA CORP. STOCK EXCHANGE RELEASE 13 FEBRUARY 2008 AT 09 AM
ALMA MEDIA FINANCIAL STATEMENTS BULLETIN 2007:
- Net sales increased and operating profit improved; dividend
proposal EUR 0.90
2007 highlights:
- Net sales MEUR 328.9 (2006: MEUR 301.9)
- Operating profit MEUR 64.4, 19.6% of net sales
(MEUR 49.1, 16.3%)
- One-time items of capital gain MEUR 11.5 (MEUR 2.7)
- Profit before tax MEUR 68.0 (MEUR 49.9)
- Earnings per share EUR 0.68 (EUR 0.50)
- Proposed dividend EUR 0.90 per share (EUR 0.65)
- In 2008 net sales will rise, comparable operating profit similar to
2007
President and CEO Kai Telanne:"Overall, 2007 was a good year for Alma Media. For the media market
the year split clearly into two parts. Record growth at the beginning
of the year was boosted by the March general elections. After the
summer the growth in media advertising slowed down.
Media sales of our Newspapers segment increased faster than the
market during the year, and circulation sales also developed well.
The full-year result for Newspapers improved, although the very end
of the year was fairly weak. Cost pressures resulting for example
from distribution prices and pay agreements will demand strict
discipline with costs. We are vigorously developing the online
services of newspapers, improving services for reader-customers and
the total coverage of the newspaper media.
For the Kauppalehti group the year, which was characterized by
restructuring measures, fluctuating media sales and successful
product renewals, went quite well. The competitive scene for business
media changed significantly towards the end of the year. Coupled with
the group's own development measures, this lays a good basis for the
future of Kauppalehti.
The Marketplaces segment was extremely successful throughout the
year. Despite the continuing development projects, the result
improved. The biggest investment, the Mikko.fi service launched in
the Finnish market, affected the result towards the end of the year
and, as planned, will weaken the 2008 result for Marketplaces by
about EUR 1 million.
We expect developments in the media market in 2008 continue to be
uneven in different regions and periods of the year. Shorter
visibility makes it more difficult to forecast net sales growth."
Further information:
President and CEO Kai Telanne, tel. +358 (0)10 665 3500
CFO Teemu Kangas-Kärki, tel. +358 (0)10 665 2244.
Conference, webcast and conference call:
The company will hold a conference in Finnish concerning its
financial statements bulleting at 11.00 am on 13 February 2008 in the
Carl cabinet of the Scandic Marski hotel at Mannerheimintie 10,
Helsinki. A webcast in English will start at www.almamedia.fi at 1.00
pm (EET). A conference call 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 FINANCIAL STATEMENTS BULLETIN 1 JANUARY - 31
DECEMBER 2007
The descriptive part of this review focuses on the annual financial
statements. The figures in brackets refer to the 2006 financial
statements, unless otherwise stated. The figures in the tables are
independently rounded.
CHANGES IN GROUP STRUCTURE COMPARED TO 2006
The mergers of Alma Media Corporation's subsidiaries Suomalainen
Lehtipaino Oy, Alpress Oy and Marcenter Oy with their parent company
were registered in the Trade Register on 31 December 2007. The
objective of the mergers is to clarify the group structure.
Kainuun Sanomat sold its sheet printing business on 15 August 2007 to
KS Paino Oy.
Kainuun Sanomat sold its newspaper printing business on 28 June 2007
to Pyhäjokiseudun Kirjapaino Oy.
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 EUR 9 million.
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 companies, Bovision AB and Objektvision AB with
aggregate annual net sales of around MEUR 1.7, were acquired for the
Marketplaces segment.
CONSOLIDATED NET SALES AND RESULT OCTOBER-DECEMBER 2007
Consolidated net sales between October and December 2007 totalled
MEUR 85.5 (MEUR 82.9). Operating profit amounted to MEUR 20.6 (MEUR
16.0). The operating margin was 24.1% (19.3%). Operating profit
includes one-time capital gain of MEUR 8.9 (MEUR 2.7). The company
cancelled the finance leasing agreement for the office and printing
works building in Tampere and agreed on a new leasing contract for
the property with a new landlord.
The Newspapers segment had net sales of MEUR 59.3 (MEUR 58.2). Growth
was small mainly due to the sharp slow down in growth in media sales
in November and December. Aamulehti's media sales remained unchanged
from the previous year and Iltalehti's improved. Developments in the
net sales of regional and local newspapers showed clear local
differences. Newspapers had an operating profit of MEUR 9.4 (MEUR
10.8). Operating profit was weakened by costs from printing
facilities, including maintenance and repair costs, and by higher
distribution costs and the pay agreements reached.
Kauppalehti group had net sales of MEUR 19.1 (MEUR 19.0). Growth in
net sales was slowed down by the closing down of Presso during the
quarter. Kauppalehti's circulation sales increased 4.6%. Net sales
from online business grew well. The group had an operating profit of
MEUR 2.2 (MEUR 0.8). The operating profit for the quarter for
comparison included a restructuring provision of MEUR 1.1. The
Kauppalehti product family and the new agency Baltic News Service
(BNS) improved their operating profits. The profitability of the
customer magazine business declined due to the intense competition.
Net sales of the Marketplaces segment totalled MEUR 8.0 (MEUR 6.4).
Growth was fastest in the Monster.fi and City24 services, but
Etuovi.com and Autotalli.com also grew rapidly. Operating profit for
Marketplaces was MEUR 1.2 (MEUR 0.8). In particular Etuovi.com,
Monster.fi and City24 in Estonia recorded good results. The overall
result for Marketplaces was weakened by the investments in the new
Mikko.fi service and in operations outside Finland.
CONSOLIDATED NET SALES AND RESULT 2007
Alma Media Corporation's net sales in 2007 totalled MEUR 328.9 (MEUR
301.9). Higher media sales in newspapers and online services were the
biggest factor in increasing net sales.
The consolidated operating profit improved to MEUR 64.4 (MEUR 49.1).
The operating margin was 19.6%, compared to 16.3% a year ago.
Operating profit includes a one-time item of capital gains of
altogether MEUR 11.5. Alma Media sold a property used by the
newspaper Lapin Kansa in Rovaniemi on 1 February 2007 and land in
Rovaniemi on 19 September 2007. In addition, the company obtained a
one-time gain on 25 October 2007 when it cancelled the finance
leasing agreement for the office and printing works building in
Tampere and agreed on a new leasing contract for the property with a
new landlord. The 2006 operating profit included one-time items with
a net posimpact of MEUR 2.7.
Reviews of the 2007 key figures for the segments are given later in
this bulletin, starting on page 5.
PROSPECTS FOR 2008
Alma Media expects its net sales to increase from the previous year.
The media market is expected to grow in 2008, but uncertainty will
increase.
The comparable operating profit for the full year should be at the
level of the previous year. The operating profit at the beginning of
the year may fall short of the previous year's figure. One-time items
have been eliminated from the comparable 2007 operating profit.
MARKET CONDITIONS
The restlessness in the financial markets and the fading of economic
growth in the USA are likely to slow down and increase uncertainty in
Finland's economy.
In 2007 altogether MEUR 1315 was used in media advertising in
Finland, which is 6.4% more than in the previous year. Newspapers and
city papers accounted for 52.5% of the euros spent on advertising,
television for 19.9%, magazines for 16.0% and online media for 4.7%.
Advertising in the online media grew 29.3% in the year.
During the final quarter of 2007, growth in advertising volume slowed
down considerably from the record pace at the start of the year, to
3.9%. In October-December, growth in media advertising in newspapers
was 1.1%. Advertising sales in online media continued to grow
strongly, increasing by 27.7%. Growth in television advertising was
8.3%.
KEY FIGURES
2007 2006 2007 2006
MEUR 10-12 10-12 1-12 1-12
Net sales 85.5 82.9 328.9 301.9
Operating profit 20.6 16.0 64.4 49.1
% of net sales 24.1 19.3 19.6 16.3
Net financial expenses -0.2 0.0 -0.1 0.5
Net financial expenses, % of net sales -0.2 0.0 0.0 0.2
Share of associated companies' results 1.4 0.1 3.5 1.2
Balance sheet total 181.3 199.7
Gross capital expenditure 3.8 3.4 12.1 19.6
Gross capital expenditure, % of net sales 4.4 4.2 3.7 6.5
Equity ratio 69.8 61.3
Gearing, % -15.2 -5.6
Interest-bearing net debt -17.9 -6.5
Interest-bearing liabilities 6.8 21.7
Non-interest-bearing liabilities 56.2 62.7
Average no. of personnel, calculated as
full-time employees, excl. delivery staff 1,909 1,929 1,971 1,901
Average no. of delivery staff 909 887 962 857
Earnings/share, EUR
(basic) 0.22 0.16 0.68 0.50
Earnings/share, EUR
(diluted) 0.22 0.16 0.68 0.50
Cash flow from operating activities, EUR 0.10 0.11 0.70 0.63
Shareholders' equity/share, EUR 1.58 1.54
Market capitalization 870.7 690.2
Average no. of shares (1,000 shares)
- basic 74,613 74,613 74,613 74,613
- diluted 74,829 74,629 74,773 74,613
No. of shares at end of period
(1,000 shares) 74,613 74,613 74,613 74,613
2007 2006 2007 2006
NET SALES BY SEGMENT, MEUR 10-12 10-12 1-12 1-12
Newspapers 59.3 58.2 230.6 217.9
Kauppalehti group 19.1 19.0 70.1 62.6
Marketplaces 8.0 6.4 30.9 23.1
Other operations and eliminations -0.9 -0.7 -2.7 -1.7
Total 85.5 82.9 328.9 301.9
2007 2006 2007 2006
OPERATING PROFIT/LOSS BY SEGMENT, MEUR 10-12 10-12 1-12 1-12
Newspapers 9.4 10.8 42.8 38.4
Kauppalehti group 2.2 0.8 7.6 4.8
Marketplaces 1.2 0.8 5.3 2.8
Other operations and eliminations 7.8 3.7 8.7 3.1
Total 20.6 16.0 64.4 49.1
NEWSPAPERS
Newspapers, key figures, MEUR 2007 2006 2007 2006
10-12 10-12 1-12 1-12
Net sales 59.3 58.2 230.6 217.9
Circulation sales 26.9 26.4 106.9 101.8
Media advertising sales 29.6 28.8 112.6 104.5
Printing sales 1.2 1.7 5.4 6.2
Other sales 1.5 1.3 5.7 5.4
Operating profit 9.4 10.8 42.8 38.4
Operating margin, % 15.8 18.5 18.5 17.6
Gross capital expenditure 1.2 0.9 6.0 4.1
Average no. of personnel, calculated as
full-time employees, excl. delivery staff 1,167 1,189 1,218 1,220
Average no. of delivery staff 909 887 962 857
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 in 2007 increased 5.8% from the
previous year to MEUR 230.6. In the first half of the year, net sales
grew at record pace, thanks to good market conditions and, for one
thing, the general elections. The media sales of the Alma Media
newspapers increased significantly more than market growth. In
particular Aamulehti and Iltalehti were very successful. Towards the
end of the year growth in net sales was low, which resulted from the
sharp slow down in growth in media sales in November and December.
Circulation sales for the newspapers grew apace. The circulations of
Aamulehti and Lapin Kansa in particular increased well. The increase
in the price of Iltalehti made in November 2006 raised the comparable
circulation sales for that paper. Iltalehti increased its market
share from the beginning of 2007 by one percentage point to 42.4%.
However, the daily tabloid market declined over the same period by
3.5%.
Iltalehti's online service Iltalehti.fi was in fine shape throughout
the year, in terms of numbers of visitors and of media sales. The
online services of the regional newspapers also returned healthy
figures.
The full-year operating profit for the Newspapers segment improved to
MEUR 42.8 (MEUR 38.4).
KAUPPALEHTI GROUP
Kauppalehti group, key figures, MEUR 2007 2006 2007 2006
10-12 10-12 1-12 1-12
Net sales 19.1 19.0 70.1 62.6
Circulation sales 6.3 6.5 24.4 23.7
Media advertising sales 6.5 6.8 21.5 21.9
Other sales 6.4 5.8 24.3 17.0
Operating profit 2.2 0.8 7.6 4.8
Operating margin, % 11.7 4.0 10.8 7.7
Gross capital expenditure 0.4 0.5 1.1 6.4
Average no. of personnel, calculated as
full-time employees 498 535 527 496
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 figures for comparison from
1 July 2006.
In January-December 2007 the net sales of the Kauppalehti group grew
12.1% from the previous year to MEUR 70.1 (MEUR 62.6). Net sales
increased due to the new business units purchased during 2006 and to
the strong sales by the online business.
The Kauppalehti group had an operating profit of MEUR 7.6 (MEUR 4.8).
The 2006 operating profit included a restructuring provision of MEUR
1.1. Within the Kauppalehti group, the Kauppalehti product family
improved its operating profit. The profitability of the contract
publishing business declined due to the intense competition in the
sector.
MARKETPLACES
Marketplaces, key figures, MEUR 2007 2006 2007 2006
10-12 10-12 1-12 1-12
Net sales 8.0 6.4 30.9 23.1
Operations in Finland 6.5 5.1 25.2 19.7
Operations outside Finland 1.5 1.2 5.7 3.3
Operating profit 1.2 0.8 5.3 2.8
Operating margin, % 15.0 11.8 17.3 12.3
Gross capital expenditure 1.6 1.7 2.8 7.3
Average no. of personnel, calculated as 176 132 158 111
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 City24,
Motors24, Mascus and Bovision.
During 2007 the net sales of Marketplaces increased 33.9%, to MEUR
30.9. Marketplaces maintained a strong rate of growth in net sales
steadily throughout the year. Growth was faster at the Monster.fi and
City24 services, but Etuovi.com and Autotalli.com also boosted their
sales rapidly.
Marketplaces' full-year operating profit improved to MEUR 5.3 (MEUR
2.8). Especially the services Etuovi.com, Monster.fi, and City24 in
Estonia recorded a good result. Marketplaces' result was weakened by
the launch of the Mikko.fi service, an important future initiative in
Finland, and by the international operations.
ASSOCIATED COMPANIES
Share of associated companies' results, MEUR 2007 2006 2007 2006
10-12 10-12 1-12 1-12
Newspapers 0.0 0.0 0.1 0.0
Kauppalehti group
Talentum Oyj 1.3 0.2 2.6 0.7
Other associated companies 0.0 0.0 0.0 0.3
Marketplaces 0.0 0.0 0.0 0.0
Other operations
Acta Print Kivenlahti Oy 0.0 -0.2 0.1 -0.4
Other associated companies 0.0 0.1 0.7 0.6
Total 1.4 0.1 3.5 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. In July 2007 Acta Print Oy announced
that it was selling its magazine business to Forssan Kirjapaino. The
name of the company responsible for the remaining business of
Kivenlahden paino has been changed to Acta Print Kivenlahti Oy.
BALANCE SHEET AND FINANCIAL POSITION
The consolidated balance sheet on 31 December 2007 stood at MEUR
181.3 (31 December 2006: MEUR 199.7). The Group's equity ratio at the
end of December was 69.8% (31 December 2006: 61.3%) and equity per
share was EUR 1.58 (31 December 2006: EUR 1.54).
The consolidated cash flow before financing was MEUR 49.1 (MEUR
45.2). At the end of December the Group's net debt totalled MEUR
-17.9 (31 December 2006: MEUR -6.5)
The Group's interest-bearing debt is denominated in euros and
therefore does not require hedging against exchange rate differences.
The most significant purchasing contracts denominated in foreign
currency are hedged.
The Group has a current MEUR 100 commercial paper programme in
Finland under which it is permitted to issue papers to a total amount
of MEUR 0-100. On 31 December 2007 this programme was entirely
unused.
RESEARCH AND DEVELOPMENT COSTS
Research and development costs in 2007 amounted to MEUR 3.7 (MEUR
1.7). Of this total, MEUR 2.8 (MEUR 1.3) was capitalized and MEUR 0.8
(MEUR 0.5) expensed. Most of the R&D costs went on developing IT
systems supporting online business.
CAPITAL EXPENDITURE
Gross capital expenditure in 2007 totalled MEUR 12.1 (MEUR 19.6) and
this consisted mainly of development projects for online media and
maintenance investments at the printing plants.
ADMINISTRATION
Alma Media's annual general meeting, held on 8 March 2007 elected the
following to the Board of Directors: Lauri Helve, Matti Häkkinen,
Matti Kavetvuo, Kai Seikku, Kari Stadigh, Harri Suutari, and new
member Ahti Vilppula. At the organization meeting of the Board held
after the AGM, the Board elected Kari Stadigh as its chairman and
Matti Kavetvuo as its deputy chairman.
The meeting appointed Ernst&Young Oy as the company's auditors.
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 telecommunications, and an interruption of printing operations.
Alma Media's risk management process helps to identify the risks,
develop appropriate risk management methods and regularly report on
risk issues to the risk management function.
PERSONNEL
During 2007, the average number of Alma Media employees, calculated
as full-time employees, was 1971 (1901). The average number of
distribution staff totalled 962 (857). The number of personnel grew
proportionately most during the year at Marketplaces.
THE ALMA MEDIA SHARE
During January-December 2007, a total of 62.1 million Alma Media
shares were traded on the Helsinki Stock Exchange, representing 83.2%
of the total number of shares. The closing price for the share on 31
December 2007 was EUR 11.67. During the year the lowest price paid
for the share was EUR 8.93 and the highest EUR 12.43. The company's
market capitalization at the end of December was MEUR 870.7.
In March 2007 Alma Media paid a dividend of EUR 0.65 a share, in
total MEUR 48.5. The company does not own any of its own shares and
does not have a current authorization to purchase its own shares on
the market.
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
During 2007 the company received the following notices concerning
changes in share holdings, under chapter 2, section 9 of the
Securities Market Act:
- 20 February 2007: Nordea group raised its holding to 7.67% on 16
February
2007 but its holding fell below the 1/20th limit on 20 February owing
to a
share loan.
- 21 February 2007: Evli Pankki Oyj made a share loan agreement on 16
February 2007 under which it borrowed shares representing 5.97% of
Alma
Media's share capital and votes on 20 February 2007. The loan period
was
open-ended. Evli group's holding will rise to 6.74%.
- 2 March 2007: Evli group's holding fell to 0.80% owing to the sale
of
shares and the return of its borrowed shares
- 2 March 2007: Nordea Bank Finland's holding rose to 6.54% owing to
the
return on share loans. Nordea group's total holding is 7.52%.
- 8 March 2007: Skandinaviska Enskilda Banken AB's holding fell
below the
1/20th limit. Following the transaction Skandinaviska Enskilda Banken
owns
no Alma Media shares.
- 9 March 2007: Nordea group's total holding rose to 14.94% as a
result of
forward contracts.
- 12 March 2007: Herttaässä's total holding increased to above 1/10th
on 8
March 2007 and fell below 1/10th on 9 March 2007. In a forward
contract
signed on 8 March 2007 Herttaässä closed its forward contract due on
15
June 2007 and purchased the underlying shares, as a result of which
Herttaässä's shareholding rose to 12.495% on 8 March 2007. On 9 March
2007
Herttaässä made a forward contract maturing on 20 March 2008 as a
result of
which Herttaässä's direct shareholding decreasd to 6.527%.
Herttaässä's
holding following the maturity of the forward contract on 20 March
2007
corresponds to 12.495%.
- 12 June 2007: Nordea group's holding in Alma Media including
forward
contracts exceeded 15%.
- 20 June 2007: Nordea announced that, contrary to earlier
announcements, the
maturity of previously made forward contracts did not reduce the
bank's
holding to below the 15% flagging limit owing to new share
acquisitions.
The holding was announced as 15.29%
- 29 June 2007: Nordea bank's holding was reduced to 10.90% after the
bank
announced its sale of 2,515,000 Alma Media shares.
- 29 June 2007: Oy Herttaässä Ab's holding in Alma Media increased to
10.15% and, including forward contracts, to 13.18%.
- 2 October 2007: Nordea announced that, contrary to earlier
announcements, its holding had stayed above 1/10th and was 13.06% of
the shares and votes.
- 7 November 2007: Herttaässä announced that its holding had risen
above 3/20ths and was 15.03% of the shares and votes
- 8 November 2007: Procomex and Helsingin Mekaanikontalo announced
that their combined holding, contrary to previous announcements, had
stayed above the 1/20th limit and was 9.6%.
- 26 November 2007: Procomex and Helsingin Mekaanikontalo announced
that their combined holding had risen above 1/10th and was 10.11%.
ENVIRONMENTAL IMPACTS
The most significant environmental impacts from Alma Media's business
operations consist of paper and energy consumption and traffic
emissions. The company mainly uses newsprint in its newspaper
products; consumption of this is about 37,000 tonnes a year. The
company uses about 20,632 MWh of electricity a year. The carbon
dioxide emissions from printing and distribution arise mainly from
traffic.
DIVIDEND PROPOSAL
Alma Media Corporation's Board of Directors will propose to the
annual general meeting on 12 March 2008 that a dividend of EUR
67,151,271 (EUR 0.90 per share) be paid for the 2007 financial year.
The payment date is 27 March 2008. On 31 December 2007, the Group's
parent company had distributable funds of altogether EUR 76,998,227.
2007 2006 2007 2006
INCOME STATEMENT, MEUR 10-12 10-12 1-12 1-12
NET SALES 85.5 82.9 328.9 301.9
Other operating income 9.1 4.5 13.0 5.5
Materials and services -25.7 -24.9 -99.1 -92.0
Costs arising from employment benefits -30.0 -30.0 -111.7 105.7
Depreciation and writedowns -2.3 -2.6 -9.8 -10.1
Operating expenses -15.9 -13.7 -56.8 -50.4
OPERATING PROFIT 20.6 16.0 64.4 49.1
Financial income 0.3 0.3 1.2 2.1
Financial expenses -0.1 -0.3 -1.1 -2.6
Share of associated companies' results 1.4 0.1 3.5 1.2
PROFIT BEFORE TAX 22.1 16.1 68.0 49.9
Income tax -5.5 -4.3 -16.8 -12.5
PROFIT FOR THE PERIOD 16.6 11.8 51.2 37.3
Distribution:
To the parent company shareholders 16.5 11.8 50.5 37.0
Minority interest 0.1 0.0 0.6 0.3
Earnings/share, EUR 0.22 0.16 0.68 0.50
Earnings/share (diluted), EUR 0.22 0.16 0.68 0.50
BALANCE SHEET, MEUR 31.12.2007 31.12.2006
ASSETS
NON-CURRENT ASSETS
Goodwill 29.7 30.2
Intangible assets 10.2 9.7
Tangible assets 38.4 51.7
Investment properties 0.0 0.0
Investments in associated companies 34.1 32.1
Other long-term investments 4.0 3.9
Deferred tax assets 1.0 4.1
Other receivables 0.0 4.8
CURRENT ASSETS
Inventories 1.4 1.8
Tax receivables 0.0 0.7
Accounts receivable and other receivables 29.9 28.8
Other short-term investments 3.0 2.5
Cash and cash equivalents 24.8 28.2
ASSETS AVAILABLE FOR SALE 4.7 1.2
TOTAL ASSETS 181.3 199.7
BALANCE SHEET, MEUR 31.12.2007 31.12.2006
SHAREHOLDERS' EQUITY AND LIABILITIES
Share capital 44.8 44.8
Share premium fund 2.8 2.8
Cumulative translation adjustment 0.0 0.1
Retained earnings 70.0 67.2
Parent company shareholders' equity 117.7 114.9
Minority interest 0.6 0.4
TOTAL SHAREHOLDERS' EQUITY 118.3 115.3
LIABILITIES
Non-current liabilities
Interest-bearing liabilities 4.6 19.1
Deferred tax liabilities 1.8 1.8
Pension obligations 3.7 3.6
Provisions 0.1 0.1
Other long-term liabilities 0.9 7.2
Current liabilities
Interest-bearing liabilities 2.2 2.6
Advances received 12.0 11.6
Tax liabilities 1.1 2.2
Provisions 0.3 2.3
Accounts payable and other liabilities 36.4 33.9
TOTAL LIABILITIES 63.0 84.4
TOTAL EQUITY AND LIABILITIES 181.3 199.7
RECONCILIATION OF SHAREHOLDERS' EQUITY 1 JAN. - 31 DECEMBER 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 -0.1 -0.1 -0.1
Share of items
recognized
directly in
associated
company's equity 0.2 0.2 0.2
Income recognized
directly in equity 0.1 0.1 0.0 0.1
Profit for the
period 50.5 50.5 0.6 51.2
Net income for the
period 50.6 50.6 0.6 51.3
Share-based
payments 0.6 0.6 0.6
Dividend paid by
parent company -48.5 -48.5 -48.5
Dividends paid -0.3
by subsidiaries
Equity, 31 Dec. 44.8 2.8 70.0 117.7 0.6 118.3
2007
RECONCILIATION OF SHAREHOLDERS' EQUITY 1 JAN. - 31 DECEMBER 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 0,6 126,7
Translation
differences 0,1 0,1 0,1
Share of items
recognized
directly in
associated
company's equity -0,1 -0,1 -0,1
Income
recognized
directly in
equity 0,0 0,0 0,0
Profit for the
period 37,0 37,0 0,3 37,3
Net income for
the period 37,0 37,0 0,3 37,3
Share-based
payments 0,3 0,3 0,3
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 -0,3 -0,3
subsidiary
Equity, 31 Dec. 44.8 2,8 67,3 114,9 0,4 115,3
2006
2007 2006 2007 2006
CASH FLOW STATEMENT, MEUR 10-12 10-12 1-12 1-12
Cash flow from operating activities
Profit for the period 16.6 11.8 51.2 37.3
Adjustments -3.7 3.9 8.8 18.3
Change in working capital -2.5 -5.2 3.4 -3.8
Dividend income received 0.0 1.0 3.2 6.4
Interest income received 0.3 0.3 1.1 1.9
Interest expenses paid -0.1 -2.0 -1.1 -3.1
Taxes paid -3.5 -1.8 -14.1 -10.3
Net cash provided by operating activities 7.1 7.9 52.5 46.7
Cash flow from investing activities
Investments in tangible and intangible
assets -1.8 -1.3 -5.6 -5.4
Proceeds from disposal of tangible and
intangible assets 0.0 3.3 1.5 3.8
Other investments -1.0 0.0 -1.0 0.0
Proceeds from disposal of other investments 0.2 7.0 3.4 9.1
Subsidiary shares purchased 0.0 -1.0 -0.3 -9.0
Associated company shares purchased 0.0 0.0 -1.5 0.0
Net cash used in investing activities -2.5 8.0 -3.5 -1.5
Cash flow before financing activities 4.6 15.8 49.1 45.2
Cash flow from financing activities
Long-term loan repayments -30.0 -33.6
Short-term loans raised 2.0
Short-term loans repaid -0.6 -0.6 -5.2 -3.5
Change in interest-bearing receivables 0.1 -0.5 -0.6
Dividends paid and capital repayment -48.8 -48.8
-0.5 -30.6 -52.5 -86.5
Change in cash funds (increase + / decrease
-) 4.0 -14.7 -3.4 -41.3
Cash and cash equivalents at start of period 20.8 42.9 28.2 69.5
Cash and cash equivalents at end of period 24.8 28.2 24.8 28.2
BUSINESS ACQUISITIONS JANUARY-DECEMBER/2007
The Group did not acquire any new business operations during 2007.
Aamulehti Oy acquired a 40% holding in Tampereen Ykkösjakelut Oy in
May 2007.
INFORMATION BY SEGMENT
Alma Media's reporting segments in the financial statements 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 bulletin 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.
ASSETS BY SEGMENT, MEUR 31.12.2007 31.12.2006
Newspapers 64.7 66.7
Kauppalehti group 56.5 56.1
Marketplaces 15.4 13.9
Other operations and eliminations 19.0 29.3
Non-allocated assets 25.7 33.8
Total 181.3 199.7
LIABILITIES BY SEGMENT, MEUR 31.12.2007 31.12.2006
Newspapers 31.4 29.9
Kauppalehti group 12.6 12.2
Marketplaces 3.9 3.5
Other operations and eliminations 5.5 9.4
Non-allocated liabilities 9.7 29.4
Total 63.0 84.4
2007 2006 2007 2006
GROUP INVESTMENTS, MEUR 10-12 10-12 1-12 1-121-12
Gross capital expenditure 3.8 3.4 12.1 19.6
PROVISIONS
The company's provisions at the end of 2007 totalled MEUR 0.4.
Altogether MEUR 1.1 of the provision made in 2006 to cover
restructuring measures in Kauppalehti has been reversed in 2007
corresponding to actual costs. It has not been necessary to change
the estimates made when the provision was entered.
COMMITMENTS AND CONTINGENCIES, MEUR 31.12.2007 31.12.2006
Collateral on own behalf
Chattel mortgages 0.0 0.0
Collateral for others
Guarantees 0.0 0.0
Other commitments
Commitments based on agreements 0.1 0.1
Minimum rents payable based on other lease
agreements:
Within one year 7.5 6.1
Within 1-5 years 18.1 14.6
After 5 years 26.5 13.0
Total 52.1 33.8
The Group also has purchase agreements based on
IFRIC 4 which include a lease component per IAS
17. Minimum payments based on these agreements: 4.6 7.7
GROUP DERIVATIVE CONTRACTS, MEUR 31.12.2007 31.12.2006
Commodity derivative contracts, electricity
derivatives
Fair value * 0.1
Nominal value 0.4
* The fair value represents the return that would have arisen if the
derivative positions had been cleared on the balance sheet date.
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. The decision of
the Helsinki Administrative Court is expected early in 2008.
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 PARTY ACTIVITIES WITH 1.1-31.12.2007 1.1-31.12.2006
ASSOCIATED COMPANIES, MEUR
Sales of goods and services 0.2 0.4
Purchases of goods and services 5.9 4.4
Accounts receivable, loan and
other receivables at the balance
sheet date 4.7 4.6
Accounts payable at the balance
sheet date 0.1 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 bulleting has been prepared in accordance with IFRS standards.
The bulletin applies the same accounting principles and calculation
methods as in the previous annual accounts dated 31 December 2006.
However, the financial statements bulletin 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.
The key indicators are calculated using the same formulae as applied
in the previous 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 Oy. This divestment is not expected to have a
significant impact on Alma Media's financial position.
The figures in this bulletin 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
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