Talentum Interim Report Q1/2012
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Highlights January-March
Operating environment
Financial review
Prospects
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Highlights January-March 2012
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Changes in the segment division used in financial reporting • In January 2012, Talentum Oyj altered its business unit organisation to better support the Group's present business operations. Consequently, the Board of Directors decided on April 16, 2012 to change the company’s internal and external financial reporting structure • Talentum's business operations are divided into six segments: – – – – – –
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Magazine Business Finland Magazine Business Sweden Events Books and Legal Training Direct Marketing Other Activities
Q1/2012 in brief Net sales M€ 26 23 20 17 14 11 8 5 2 -1
• • • • •
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Net sales by quarters 2011, %
Operating income without non-recurring items
Q1/11
Q2/11
Q3/11
Q4/11
Q1/12
29,5
25,7
18,7
26,1
Q1
Q2
Q3
Q4
Net sales 20.5 M€ (21.5 M€ ) Comparable net sales 20.5 M€ excluding Talentum HR AB sold in December 2011 Operating income without non-recurring items 0.2 M€ Operating income -2.6 M€ (1.0 M€) Non-recurring items include costs of personnel reduction and other costs related to re-organization
Q1/2012 in brief • New management team was formed in January and it mainly comprises of managers of the business units • Talentum started negotiations with employee representatives to reduce personnel in January and concluded them in March • The negotiations concerned employees of Talentum Oyj and Talentum Media Oy in Finland, and Talentum magazine business in Sweden, approximately 330 employees – The measures taken will cut costs of permanent nature in the Talentum Group on yearly level by approximately EUR 4.5 million
• Finnish Government decided to raise the VAT on subscription magazines to 9 percent effective January 1, 2012, which will impact Talentum less than its Finnish competitors • The group subscription agreement with Union of Professional Engineers in Finland (UIL) was terminated at the end of 2011 • However, Talentum’s circulation revenue grew in Finland due to successful sales operations. 6
Net sales, continuing operations 8,0 7,0 6,0 5,0 4,0 3,0 2,0 1,0 0,0 -1,0 -2,0
Magazine Magazine Business Business Finland Sweden 1-3/2011 7,5 7,0 1-3/2012 7,5 6,2
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1-3/2011 1-3/2012
Events 2,4 3,2
Books and Direct Legal Marketing Training 2,2 2,2 2,0 2,7
Other Activities 0,2 -1,1
Operating environment January-March 2012
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Media advertising changes, Q1/2012 TNS Gallup
Media sales Sweden
9,3
Media sales Finland Trade magazines Sweden
1,4 -9,7
Trade magazines Finland
-2,0
Online Sweden
10,0
Online Finland
-15,0 -10,0
13,7
-5,0
0,0
5,0
10,0
15,0
Finland • Media advertising during January-March increased by 1.4% (1.3% excluding elections) Sweden • Media advertising during January-March increased by 9.3% 9
Employee information, March 31, 2012 Average number of personnel 771 (734) Estonia; 91
Number of personnel by segment Other Activities; 39
Russia; 8
Magazine Business Finland; 145
Latvia; 85 Denmark; 13
Sweden; 140 Finland; 433
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Magazine Business Sweden; 110
Direct Marketing; 343
Books and Legal Training; 43
Events; 91
Finance and investments March 31, 2012 • • • • • • • • •
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Total assets on the balance sheet 61,9 M€ (31.12.2011: 57,3 M€) Net bearing liabilities -1,8 M€ (-1,5 M€) Equity ratio 39,3% (54.1%) Gearing -10.6% (-6.7%) The existing credit limits amount to 34 M€ for three/four years Credit limits in use 0.0 M€ Operative cash flow 0.7 M€ (1.8 M€) in continuing operations Change in net working capital 3.3 M€ (0,5 M€) Market Capitalization 70,9 M€ (88,1 M€ )
Prospects
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Strategy in brief • Talentum’s core business is publishing targeted at professionals in various sectors • The company’s strengths are its multichannel approach and strong, well-known brands, as well as accurately defined expert target groups and good knowledge of them • The most important short-term goal of Talentum’s business operations is to improve profitability • In addition to other publishing operations, the main focus areas of growth are e-business and events • Talentum is purposefully developing business operations which are less dependent on economic conditions than advertising • The aim is to diversify the company’s income structure to boost the proportion of income derived from content, rather than circulation and advertising 13
Prospects 2012, unchanged • The company estimates that economic growth in the main market areas, Finland and Sweden will be modest in 2012, which will reflect relatively moderate growth in advertising. • Talentum estimates that in 2012 its comparable net sales will remain on the same level and its operating income without non-recurring items will increase compared to 2011.
• Next interim report on July 20, 2012.
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We help professionals to succeed. Helsinki – Stockholm – Copenhagen – Tallinn – Riga - Moscow
Talentum Oyj Annankatu 34-36 B 00100 Helsinki, Finland Puhelin 020 442 40 www.talentum.com 15