AS Ekspress Grupp: Consolidated Interim Report for the Fourth Quarter and 12-months of 2017Tallinn, Estonia, 2018-02-28 15:36 CET --
The year 2017 was primarily a year of adaption for the Group. At the beginning of the year, changes took place in the managements of the parent company and three media companies domiciled in Estonia.
The trend of users of all ages moving to Internet has become the new normality, creating new possibilities for our products on the one hand while leading to a decline of interest in printed newspapers, magazines and advertising products.
All this requires an innovative approach and entry into new lines of business in order to keep pace with the changing needs and requirements of consumers. Constant and bold innovation has become the cornerstone of our activities, it offers excitement and enables us to survive and grow in a more competitive business environment.
As the market leader of news portals in the Baltic States, Delfi continues to invest in new technology and IT solutions with the goal of improving the user experience of its readers and advertisers in various channels and platforms. In 2017, innovative technology was developed further, enabling to pay for fee-based content with one click. We believe that this technology will also have international success and in addition to taking part in the pilot project, we are also co-investors in Zlick Ltd.
We have launched ad-free Delfi, enabling to read ad-free Delfi portal for a monthly fee. New separate mobile applications of our digital newspapers, various product packages as well as Delfi verticals have been introduced.
The content produced by our companies has almost 75 000 digital subscribers with an access to content in all channels. It marks a strong entry into the market of digital subscribers. We are undoubtedly pioneers in our region, paving the way for the growth of paid content consumption in the Baltic States. This will help us offset the decline in paper revenue.
Since last year, our media companies offer customers an option to buy advertising services ranging from the idea and execution to media space. We also provide programmatic advertising sales and in addition to online advertising, we offer the possibility to buy advertising in other local or international channels. At the year-end, we acquired the remaining 51% holding in Adnet Media, the largest online advertising multi-channel and advertising network in the Baltic States.
As a new trend we have entered the event organising market. In addition to traditional media we are moving more into the entertainment sector, offering our current and new consumers also possibility to experience different events in addition to journalistic content. The greatest success stories include the Game of the Stars of the Estonian Basketball League in February; Ruja’s reunion concert at Tallinn Song Festival Grounds dedicated to the day of regaining independence of Estonia (attended by 14 000 people which was second best result in terms of the concert audience in Estonia in 2017); Kadri Voorand’s sold-out concerts in Nordea Concern Hall and preparations for the large-scale project “Idea for Lithuania” arranged by Delfi Lithuania in February 2018.
We are taking major steps in the business line of digital outdoor advertising. We have actively increased our reach by developing the network of digital billboards. It will be easy to continue from here and focus on sales activities.
In 2017, the activities of the Group’s media branch were supported by strong macroeconomic indicators in the Baltic States (primarily in Latvia). On the other hand we are also competing with large global giants such as Facebook and Google that grab a larger share of the market growth.
The printing services sector experienced a downturn where the price pressure is extremely strong and the printing company with a focus on quality needs to aggressively expand its products and customer portfolio.
In 2017, the Group’s consolidated revenue increased by 1% as compared to last year and totalled EUR 63.7 million. EBITDA was 21% lower than last year’s level, totalling EUR 6.7 million and the net profit totalled EUR 3.1 million.
The management proposes to pay dividends for 2017 seven euro cents per share in total amount EUR 2.1 million.
Ever-increasing price competition in the printing services segment, declining margins, lower delivery volumes of the home delivery company and increasing staff costs played a role in it. Significant impairment loss of books in the balance sheet of Ajakirjade Kirjastus, that had been published a few years earlier and whose circulations had been way too optimistic, had to be recognised.
As the market of books is in a continuous downturn, the department of the book publishing of Ajakirjade Kirjastus was merged with the Group’s separate book publishing company Hea Lugu in the 4th quarter. Investments have been made in the online capability of Ajakirjade Kirjastus which has increased staff costs and which have had negative impact on the company’s last year’s profit.
At the year-end, the unprofitable business line of magazines was sold in Lithuania which will enable to focus primarily on online activities and other lines of business that continue growing.
On a positive note, online revenues grew in all countries and by 16% in Group total. Digital subscription revenue has increased by almost 50%. Online revenue now makes up almost 33% of the Group’s total revenue.
The year 2018 will be a year of new hopes and expectations in several segments. Last year we made major investment decisions and this year should show the first results. In the media sector we are witnessing steady growth in all our companies. This year we will focus on increasing the revenue from digital subscribers. The business line of event organising has proven its viability in Estonia while Lithuania is also gaining momentum. In Latvia, the business of outdoor advertising is strongly underway. In the printing services segment we are expecting stabilisation and witness the effect of new investments on revenue and EBITDA. At the same time we are planning to increase the share of digital revenue in our portfolio – both from the basis of current media business as well as new ideas.
In the consolidated financial reports 50% joint ventures are recognised under the equity method, in compliance with international financial reporting standards (IFRS). In its monthly reports, the management monitors the Group’s performance on a basis of proportional consolidation of joint ventures and the syndicated loan contract also determines the calculation of some loan covenants by proportional consolidation. For the purpose of clarity, the management report shows two sets of indicators: one where joint ventures are consolidated line-by-line 50% and the other where joint ventures are recognised under the equity method and their net result is presented as financial income in one line.
FINANCIAL INDICATORS AND RATIOS – joint ventures consolidated 50% line-by-line
Performance indicators – joint ventures 50%
consolidated (EUR thousand) |
Q4 2017 |
Q4 2016 |
Change % |
Q4 2015 |
Q4 2014 |
Q4 2013 |
For the period |
|
|
|
|
|
|
Sales |
17 606 |
17 409 |
1% |
17 181 |
16 778 |
16 526 |
EBITDA |
1 512 |
2 981 |
-49% |
2 720 |
2 757 |
2 015 |
EBITDA margin (%) |
8.6% |
17.1% |
|
15.8% |
16.4% |
12.2% |
Operating profit* |
630 |
2 113 |
-70% |
1 936 |
1 895 |
1 348 |
Operating margin* (%) |
3.6% |
12.1% |
|
11.3% |
11.3% |
8.2% |
Interest expenses |
(104) |
(123) |
16% |
(141) |
(186) |
(185) |
Net profit/(loss) for the period* |
508 |
1 868 |
-73% |
1 660 |
1 614 |
1 057 |
Net margin* (%) |
2.8% |
10.7% |
|
9.7% |
9.6% |
6.4% |
Net profit for the period in financial statements (incl. write-downs and gain from change in ownership interest) |
703 |
1 868 |
-62% |
460 |
1 149 |
(1 410) |
Net margin (%) |
4.0% |
10.7% |
|
2.7% |
6.8% |
-8.5% |
Return on assets ROA (%) |
0.9% |
2.4% |
|
0.6% |
1.4% |
-1.8% |
Return on equity ROE (%) |
1.3% |
3.7% |
|
0.9% |
2.4% |
-3.2% |
Earnings per share (EPS) |
0.02 |
0.06 |
|
0.02 |
0.04 |
(0.05) |
Performance indicators – joint ventures 50%
consolidated (EUR thousand) |
12 months 2017 |
12 months 2016 |
Change % |
12 months 2015 |
12 months 2014 |
12 months
2013 |
For the period |
|
|
|
|
|
|
Sales |
63 699 |
62 793 |
1% |
61 528 |
61 384 |
58 427 |
EBITDA |
6 713 |
8 487 |
-21% |
7 869 |
8 878 |
7 264 |
EBITDA margin (%) |
10.5% |
13.5% |
|
12.8% |
14.5% |
12.4% |
Operating profit* |
3 526 |
5 221 |
-32% |
4 866 |
5 638 |
4 647 |
Operating margin* (%) |
5.5% |
8.3% |
|
7.9% |
9.2% |
8.0% |
Interest expenses |
(427) |
(518) |
17% |
(618) |
(732) |
(763) |
Net profit/(loss) for the period* |
2 952 |
4 406 |
-33% |
3 907 |
4 620 |
3 548 |
Net margin* (%) |
4.6% |
7.0% |
|
6.4% |
7.5% |
6.1% |
Net profit for the period in financial statements (incl. write-downs and gain from change in ownership interest) |
3 146 |
4 406 |
-29% |
2 707 |
5 110 |
1 081 |
Net margin (%) |
4.9% |
7.0% |
|
4.4% |
8.3% |
1.9% |
Return on assets ROA (%) |
4.1% |
5.8% |
|
3.5% |
6.6% |
1.4% |
Return on equity ROE (%) |
6.1% |
8.9% |
|
5.6% |
11.4% |
2.5% |
Earnings per share (EPS) |
0.11 |
0.15 |
|
0.09 |
0.17 |
0.04 |
* The results reflect the outcome of regular business activities and do not include impairment losses on goodwill, profit arised from the changes in ownership interests in our joint ventures etc.
Balance sheet – joint ventures 50% consolidated (thousand EUR) |
31.12.2017 |
31.12.2016 |
Change % |
As of the end of the period |
|
|
|
Current assets |
16 725 |
16 250 |
3% |
Non-current assets |
62 597 |
61 507 |
2% |
Total assets |
79 322 |
77 757 |
2% |
incl. cash and bank |
2 818 |
4 572 |
-38% |
incl. goodwill |
39 920 |
38 904 |
3% |
Current liabilities |
11 081 |
12 223 |
-9% |
Non-current liabilities |
15 747 |
14 462 |
9% |
Total liabilities |
26 828 |
26 684 |
1% |
incl. borrowings |
15 791 |
16 603 |
-5% |
|
Equity |
52 494 |
51 073 |
3% |
|
|
|
|
|
Financial ratios (%) – joint ventures consolidated 50% |
31.12.2017 |
31.12.2016 |
Equity ratio (%) |
66% |
66% |
Debt to equity ratio (%) |
30% |
33% |
Debt to capital ratio (%) |
20% |
19% |
Total debt/EBITDA ratio |
2.35 |
1.96 |
Liquidity ratio |
1.51 |
1.33 |
FINANCIAL INDICATORS AND RATIOS – joint ventures recognised under the equity method
Performance indicators – joint ventures under equity method (thousand EUR) |
Q4 2017 |
Q4 2016 |
Change % |
Q4 2015 |
Q4 2014 |
Q4 2013 |
For the period |
|
|
|
|
|
|
Sales (only subsidiaries) |
15 016 |
14 743 |
2% |
14 811 |
14 454 |
14 291 |
EBITDA (only subsidiaries) |
1 590 |
2 660 |
-40% |
2 440 |
2 413 |
1 815 |
EBITDA margin (%) |
10.6% |
18.0% |
|
16.5% |
16.7% |
12.7% |
Operating profit* (only subsidiaries) |
840 |
1 889 |
-56% |
1 718 |
1 661 |
1 175 |
Operating margin* (%) |
5.6% |
12.8% |
|
11.6% |
11.5% |
8.2% |
Interest expenses (only subsidiaries) |
(97) |
(114) |
15% |
(125) |
(158) |
(185) |
Profit of joint ventures by equity method |
(233) |
210 |
-211% |
196 |
182 |
174 |
Net profit for the period* |
508 |
1 868 |
-73% |
1 660 |
1 601 |
1 057 |
Net margin* (%) |
3.4% |
12.7% |
|
11.2% |
11.1% |
7.4% |
Net profit for the period in financial statements (incl. write-downs and gain from change in ownership interest) |
703 |
1 868 |
-62% |
460 |
1 136 |
(1 410) |
Net margin (%) |
4.7% |
12.7% |
|
3.1% |
7.9% |
-9.9% |
Return on assets ROA (%) |
0.9% |
2.5% |
|
0.6% |
1.5% |
-1.8% |
Return on equity ROE (%) |
1.3% |
3.7% |
|
0.9% |
2.4% |
-3.2% |
Earnings per share (EPS) |
0.02 |
0.06 |
|
0.02 |
0.04 |
(0.05) |
Performance indicators – joint ventures under equity method (thousand EUR) |
12 months 2017 |
12 months
2016 |
Change % |
12 months
2015 |
12 months
2014 |
12 months
2013 |
For the period |
|
|
|
|
|
|
Sales (only subsidiaries) |
54 070 |
53 324 |
1% |
52 773 |
52 793 |
50 086 |
EBITDA (only subsidiaries) |
6 261 |
7 280 |
-14% |
6 680 |
7 894 |
6 591 |
EBITDA margin (%) |
11.6% |
13.7% |
|
12.7% |
15.0% |
13.2% |
Operating profit* (only subsidiaries) |
3 475 |
4 328 |
-20% |
3 920 |
4 973 |
4 071 |
Operating margin* (%) |
6.4% |
8.1% |
|
7.4% |
9.4% |
8.1% |
Interest expenses (only subsidiaries) |
(400) |
(471) |
15% |
(550) |
(689) |
(763) |
Profit of joint ventures by equity method |
(2) |
772 |
-100% |
785 |
557 |
494 |
Net profit for the period* |
2 952 |
4 406 |
-33% |
3 907 |
4 621 |
3 548 |
Net margin* (%) |
5.5% |
8.3% |
|
7.4% |
8.8% |
7.1% |
Net profit for the period in financial statements (incl. write-downs and gain from change in ownership interest) |
3 146 |
4 406 |
-29% |
2 707 |
5 110 |
1 081 |
Net margin (%) |
5.8% |
8.3% |
|
5.1% |
9.7% |
2.2% |
Return on assets ROA (%) |
4.2% |
6.1% |
|
3.7% |
6.8% |
1.4% |
Return on equity ROE (%) |
6.1% |
8.9% |
|
5.6% |
11.4% |
2.5% |
Earnings per share (EPS) |
0.11 |
0.15 |
|
0.09 |
0.17 |
0.04 |
* The results reflect the outcome of regular business activities and do not include impairment losses on goodwill, profit arised from the changes in ownership interests in our joint ventures etc.
Balance sheet – joint ventures under equity method
(thousand EUR) |
31.12.2017 |
31.12.2016 |
Change % |
As of the end of the period |
|
|
|
Current assets |
13 827 |
13 094 |
6% |
Non-current assets |
62 130 |
61 074 |
2% |
Total assets |
75 957 |
74 169 |
2% |
incl. cash and bank |
1 073 |
2 856 |
-62% |
incl. goodwill |
37 969 |
36 953 |
3% |
Current liabilities |
8 372 |
9 591 |
-13% |
Non-current liabilities |
15 091 |
13 504 |
12% |
Total liabilities |
23 463 |
23 095 |
2% |
incl. borrowings |
15 257 |
15 784 |
-3% |
Equity |
52 494 |
51 073 |
3% |
Financial ratios (%) – joint ventures consolidated under equity |
31.12.2017 |
31.12.2016 |
Equity ratio (%) |
69% |
69% |
Debt to equity ratio (%) |
29% |
31% |
Debt to capital ratio (%) |
21% |
20% |
Total debt/EBITDA ratio |
2.44 |
2.17 |
Liquidity ratio |
1.65 |
1.37 |
Formulas used to calculate the financial ratios |
EBITDA |
Earnings before interest, tax, depreciation and amortization. EBITDA does not include any impairment losses recognized during the period or result from restructuring. |
EBITDA margin (%) |
EBITDA/sales x 100 |
Operating margin* (%) |
Operating profit*/sales x100 |
Net margin* (%) |
Net profit*/sales x100 |
Net margin (%) |
Net profit /sales x100 |
Earnings per share |
Net profit / average number of shares |
Equity ratio (%) |
Equity/ (liabilities + equity) x100 |
Debt to equity ratio (%) |
Interest bearing liabilities /equity x 100 |
Debt to capital ratio (%) |
Interest bearing liabilities – cash and cash equivalents (net debt) /(net debt +equity) x 100 |
Total debt/EBITDA ratio |
Interest bearing borrowings /EBITDA |
Debt service coverage ratio |
EBITDA/loan and interest payments for the period |
Liquidity ratio |
Current assets / current liabilities |
Return on assets ROA (%) |
Net profit /average assets x 100 |
Return on equity ROE (%) |
Net profit /average equity x 100 |
* The results reflect the outcome of regular business activities and do not include impairment losses on goodwill, profit arised from the changes in ownership interests in our joint ventures etc.
Cyclicality
All operating areas of the Group are characterised by cyclicality and fluctuation, related to the changes in the overall economic conditions and consumer confidence. The Group’s revenue can be adversely affected by an economic slowdown or recession in home and export markets. It can appear in lower advertising costs in retail, preference of other advertising channels like preference of internet rather than print media and changes in consumption habits of retail consumers e.g. following current news in news portals versus reading printed newspapers, preference of the younger generation to use mobile devices and other communication channels, etc.
Seasonality
The revenue from the Group’s advertising sales as well as in the printing services segment is impacted by major seasonal fluctuations. The level of both types of revenue is the highest in the 2nd and 4th quarter of each year and the lowest in the 3rd quarter. Revenue is higher in the 4th quarter because of higher consumer spending during the Christmas season, accompanied by the increase in advertising expenditure. Advertising expenditure is usually the lowest during the summer months, as well as during the first months of the year following Christmas and New Year’s celebrations. Book sales are the strongest in the last quarter of the year. Subscriptions and retail sales of periodicals do not fluctuate as much as advertising revenue. However the summer period is always more quiet and at the beginning of the school year in September there is an increase in subscriptions and retail sale which usually continues until next summer holiday period.
SEGMENT OVERVIEW
The Group’s activities are divided into two large segments - media segment and printing services segment.
The segments’ EBITDA does not include intragroup management fees, impairment of goodwill and trademarks. Volume-based and other fees payable to advertising agencies have not been deducted from the advertising sales of segments, because the management monitors gross advertising sales. Discounts and rebates are reduced from the Group’s sales and are included in the combined line of eliminations.
Key financial data of the segments Q4 2013-2017
(thousand EUR) |
Sales |
Sales |
|
Q4
2017 |
Q4
2016 |
Change % |
Q4
2015 |
Q4
2014 |
Q4
2013 |
media segment (by equity method) |
9 449 |
8 861 |
7% |
8 399 |
7 535 |
7 617 |
incl. revenue from all digital and online channels |
5 944 |
4 993 |
19% |
4 544 |
4 015 |
3 389 |
printing services segment |
6 496 |
6 952 |
-7% |
7 386 |
8 083 |
7 566 |
entertainment segment |
0 |
0 |
- |
0 |
0 |
0 |
corporate functions |
686 |
566 |
21% |
543 |
459 |
393 |
intersegment eliminations |
(1 616) |
(1 635) |
|
(1 517) |
(1 624) |
(1 286) |
TOTAL GROUP under equity method |
15 016 |
14 743 |
2% |
14 811 |
14 454 |
14 291 |
media segment (by proportional consolidation) |
12 391 |
11 836 |
5% |
11 042 |
10 141 |
10 042 |
incl. revenue from all digital and online channels |
6 272 |
5 286 |
19% |
4 841 |
4 257 |
3 584 |
printing services segment |
6 496 |
6 952 |
-7% |
7 386 |
8 083 |
7 566 |
entertainment segment |
0 |
0 |
- |
0 |
0 |
0 |
corporate functions |
686 |
566 |
21% |
543 |
459 |
393 |
intersegment eliminations |
(1 967) |
(1 944) |
|
(1 790) |
(1 905) |
(1 477) |
TOTAL GROUP by proportional consolidation |
17 606 |
17 409 |
1% |
17 181 |
16 778 |
16 525 |
(thousand EUR) |
EBITDA |
EBITDA |
|
Q4
2017 |
Q4
2016 |
Change % |
Q4
2015 |
Q4
2014 |
Q4
2013 |
media segment (by equity method) |
1 168 |
1 618 |
-28% |
1 299 |
1 103 |
1 014 |
media segment by proportional consolidation |
1 089 |
1 939 |
-44% |
1 580 |
1 447 |
1 214 |
printing services segment |
952 |
1 329 |
-28% |
1 355 |
1 623 |
1 604 |
entertainment segment |
0 |
0 |
- |
(4) |
0 |
0 |
corporate functions |
(529) |
(287) |
85% |
(210) |
(313) |
(763) |
intersegment eliminations |
0 |
0 |
|
0 |
0 |
(40) |
TOTAL GROUP under equity method |
1 590 |
2 660 |
-40% |
2 440 |
2 413 |
1 815 |
TOTAL GROUP by proportional consolidation |
1 512 |
2 981 |
-49% |
2 720 |
2 757 |
2 015 |
EBITDA margin |
Q4
2017 |
Q4
2016 |
Q4
2015 |
Q4
2014 |
Q4
2013 |
media segment (by equity method) |
12% |
18% |
15% |
15% |
13% |
media segment by proportional consolidation |
9% |
16% |
14% |
14% |
12% |
printing services segment |
15% |
19% |
18% |
20% |
21% |
TOTAL GROUP under equity method |
11% |
18% |
16% |
17% |
13% |
TOTAL GROUP by proportional consolidation |
9% |
17% |
16% |
16% |
12% |
Key financial data of the segments 12 months 2013-2017
(thousand EUR) |
Sales |
Sales |
|
12 months
2017 |
12 months
2016 |
Change % |
12 months
2015 |
12 months
2014 |
12 months
2013 |
media segment (by equity method) |
33 498 |
31 579 |
6% |
30 063 |
27 459 |
25 842 |
incl. revenue from all digital and online channels |
19 963 |
17 307 |
15% |
15 555 |
13 449 |
11 595 |
printing services segment |
23 879 |
25 585 |
-7% |
25 842 |
28 951 |
27 462 |
entertainment segment |
0 |
0 |
- |
517 |
0 |
0 |
corporate functions |
2 486 |
2 233 |
11% |
1 937 |
1 731 |
1 530 |
intersegment eliminations |
(5 793) |
(6 073) |
|
(5 586) |
(5 347) |
(4 748) |
TOTAL GROUP under equity method |
54 070 |
53 324 |
1% |
52 773 |
52 793 |
50 086 |
media segment (by proportional consolidation) |
44 429 |
42 231 |
5% |
39 942 |
36 930 |
34 954 |
incl. revenue from all digital and online channels |
21 024 |
18 094 |
16% |
16 619 |
14 306 |
12 226 |
printing services segment |
23 879 |
25 585 |
-7% |
25 842 |
28 951 |
27 462 |
entertainment segment |
0 |
0 |
- |
517 |
0 |
0 |
corporate functions |
2 486 |
2 233 |
11% |
1 937 |
1 731 |
1 530 |
intersegment eliminations |
(7 095) |
(7 255) |
|
(6 710) |
(6 228) |
(5 520) |
TOTAL GROUP by proportional consolidation |
63 699 |
62 793 |
1% |
61 528 |
61 384 |
58 426 |
(thousand EUR) |
EBITDA |
EBITDA |
|
12 months
2017 |
12 months
2016 |
Change % |
12 months
2015 |
12 months
2014 |
12 months
2013 |
media segment (by equity method) |
3 729 |
3 572 |
4% |
3 724 |
3 026 |
2 124 |
media segment by proportional consolidation |
4 181 |
4 779 |
-13% |
4 913 |
4 010 |
2 796 |
printing services segment |
3 734 |
4 645 |
-20% |
4 966 |
5 944 |
5 862 |
entertainment segment |
0 |
(2) |
-76% |
(1 110) |
0 |
0 |
corporate functions |
(1 201) |
(936) |
28% |
(899) |
(1 076) |
(1 356) |
intersegment eliminations |
0 |
0 |
|
0 |
0 |
(38) |
TOTAL GROUP under equity method |
6 261 |
7 280 |
-14% |
6 680 |
7 894 |
6 591 |
TOTAL GROUP by proportional consolidation |
6 713 |
8 487 |
-21% |
7 869 |
8 878 |
7 264 |
EBITDA margin |
12 months
2017 |
12 months
2016 |
12 months
2015 |
12 months
2014 |
12 months
2013 |
media segment (by equity method) |
11% |
11% |
12% |
11% |
8% |
media segment by proportional consolidation |
9% |
11% |
12% |
11% |
8% |
printing services segment |
16% |
18% |
19% |
21% |
21% |
TOTAL GROUP under equity method |
12% |
14% |
13% |
15% |
13% |
TOTAL GROUP by proportional consolidation |
11% |
14% |
13% |
14% |
12% |
MEDIA SEGMENT
The media segment includes Group’s activities in Estonia, Latvia and Lithuania. It comprises online portal Delfi operations, other different news portals, providing online advertising network and programmatic sales, providing outdoor digital screen advertising in Estonia and Latvia, publishing of Estonian weekly newspapers Maaleht, Eesti Ekspress and LP, publishing daily newspapers Eesti Päevaleht and tabloid Õhtuleht, publishing freesheet Linnaleht, publishing books and magazines in Estonia and Lithuania, providing home delivery services.
Latvian digital screen company ACM LV was acquired in the 3rd quarter of 2017. 100% ownership was acquired in Adnet Media in the 4th quarter of 2017.
News portals owned by the Group
(thousand EUR) |
Sales |
EBITDA |
|
Q4
2017 |
Q4
2016 |
Change
% |
Q4
2017 |
Q4
2016 |
Change
% |
Ekspress Meedia |
5 039 |
5 085 |
-1% |
391 |
443 |
-12% |
incl. Delfi Estonia online revenue |
1 828 |
1 772 |
3% |
|
|
|
Delfi Latvia |
1 086 |
997 |
9% |
132 |
262 |
-50% |
Delfi Lithuania |
2 786 |
2 558 |
9% |
628 |
865 |
-27% |
incl. Delfi Lithuania online revenue |
2 328 |
2 041 |
14% |
|
|
|
Adnet |
384 |
- |
- |
24 |
- |
- |
Hea Lugu |
241 |
230 |
4% |
43 |
50 |
-13% |
Zave Media |
0 |
0 |
- |
0 |
0 |
- |
ACM LV |
33 |
- |
- |
(37) |
- |
- |
other companies |
0 |
0 |
- |
(15) |
(1) |
1078% |
intersegment eliminations |
(120) |
(9) |
|
2 |
0 |
|
TOTAL subsidiaries |
9 449 |
8 861 |
7% |
1 168 |
1 618 |
-28% |
SL Õhtuleht* |
1 236 |
1 134 |
9% |
71 |
65 |
9% |
Ajakirjade Kirjastus* |
1 245 |
1 368 |
-9% |
(123) |
160 |
-177% |
Express Post* |
640 |
677 |
-5% |
(36) |
75 |
-148% |
Linna Ekraanid* |
85 |
115 |
-26% |
9 |
20 |
-57% |
intersegment eliminations |
(264) |
(318) |
|
2 |
0 |
|
TOTAL joint ventures |
2 942 |
2 975 |
-1% |
(77) |
320 |
-124% |
TOTAL segment by proportional consolidation |
12 391 |
11 836 |
5% |
1 089 |
1 939 |
-44% |
* Proportional share of joint ventures
(thousand EUR) |
Sales |
EBITDA |
|
12 months
2017 |
12 months
2016 |
Change
% |
12 months
2017 |
12 months
2016 |
Change
% |
Ekspress Meedia |
19 309 |
19 116 |
1% |
1 554 |
1 448 |
7% |
incl. Delfi Estonia online revenue |
6 853 |
6 728 |
2% |
|
|
|
Delfi Latvia |
3 811 |
3 375 |
13% |
395 |
413 |
-4% |
Delfi Lithuania |
9 544 |
8 563 |
11% |
1 799 |
1 741 |
3% |
incl. Delfi Lithuania online revenue |
7 831 |
6 601 |
19% |
|
|
|
Adnet |
384 |
- |
- |
24 |
- |
- |
Hea Lugu |
523 |
538 |
-3% |
26 |
33 |
-21% |
Zave Media |
0 |
1 |
-1 |
(0) |
(61) |
-100% |
ACM LV |
54 |
- |
- |
(55) |
- |
- |
other companies |
0 |
0 |
- |
(16) |
(2) |
574% |
intersegment eliminations |
(126) |
(13) |
|
2 |
0 |
|
TOTAL subsidiaries |
33 498 |
31 579 |
6% |
3 729 |
3 572 |
4% |
SL Õhtuleht* |
4 625 |
4 329 |
7% |
433 |
394 |
10% |
Ajakirjade Kirjastus* |
4 576 |
4 765 |
-4% |
69 |
544 |
-87% |
Express Post* |
2 369 |
2 609 |
-9% |
(117) |
247 |
-147% |
Linna Ekraanid* |
411 |
166 |
148% |
66 |
22 |
195% |
intersegment eliminations |
(1 052) |
(1 218) |
|
2 |
0 |
|
TOTAL joint ventures |
10 931 |
10 651 |
3% |
453 |
1 207 |
-62% |
TOTAL segment by proportional consolidation |
44 429 |
42 231 |
5% |
4 181 |
4 779 |
-13% |
* Proportional share of joint ventures
ONLINE MEDIA
Estonian online readership 2016-2017
In the third quarter 2016, Gemius changed the methodology of the online readership survey in Estonia, Latvia and Lithuania, as a result of which the data on the users of mobile devices and tablet PCs is now added into those of PC users. The comparable data is available only from September of last year.
The number of users of Delfi in Estonia has been stable. In July 2017, the growth in the number of users of Delfi represented a technical measurement inaccuracy and not an actual result.
Latvian online readership 2016-2017
Delfi continues to be the news portal with the largest online readership in Latvia. According to the survey commissioned by the Latvian government in spring 2017, Delfi.lv is Latvia’s most trusted media channel and it is trusted even more than the state-owned TV-station. In July 2017, the growth in the number of users of Delfi represented a technical measurement inaccuracy and not an actual result.
Lithuanian online readership 2016-2017
Delfi.lt remains Lithuania’s largest online portal with a high visibility in Lithuania. The Lithuanian online readership has remained stable. In 2017, Delfi has been able to grow the lead over competition on the market thanks to new products and good marketing execution, as well as good progress in mobile.
PRINT MEDIA
Estonian newspaper circulations 2016-2017
Since October 2016 and throughout 2017, the daily newspaper with the largest circulation in Estonia was Õhtuleht. Traditionally, Maaleht was the largest in January and December. From the total circulation numbers, this graph shows print circulation only, digital newspaper subscribers are not reflected here.
Circulations of Group newspapers together with digital subscribers 2016-2017
To provide more complete overview of the newspaper market dynamics, the circulation of paper newspapers needs to be viewed together with the number of digital subscribers. This shows how the decrease in print subscribers has been more than compensated by digital subscribers and how for the second half of 2017 the combined growth of print circulation and digital subscribers has been clearly positive for all our newspapers. Eesti Päevaleht has been the earliest and most successful in managing the market turnaround and developing its digital business. Based on the available data, we can show the combined information of print and digital only for the newspapers of Ekspress Grupp. Even if other newspapers on the market have digital-only products, there is currently no available data for digital subscribers of other publishers.
PRINTING SERVICES SEGMENT
All printing services of the Group are provided by AS Printall which is one of the largest printing companies in Estonia. We are able to print high-quality magazines, newspapers, advertising materials, product and service catalogues, paperback books and other publications in our printing plant.
(thousand EUR) |
Sales |
EBITDA |
|
Q4
2017 |
Q4
2016 |
Change
% |
Q4
2017 |
Q4
2016 |
Change % |
Printall |
6 496 |
6 952 |
-7% |
952 |
1 329 |
-28% |
(thousand EUR) |
Sales |
EBITDA |
|
12 months
2017 |
12 months
2016 |
Change
% |
12 months
2017 |
12 months
2016 |
Change % |
Printall |
23 879 |
25 585 |
-7% |
3 734 |
4 645 |
-20% |
Already several years the printing services segment continues to be under pressure due to continues digitalization of regular journalism and internet taking its share from printed products. The price pressure is very strong both in Scandinavia and Estonia including more competitive services provided by other Baltic States. A sheet-fed machine acquired two years ago has helped to prevent a steeper revenue decline, and has helped to expand the product range outside the regular media sector. More active sales approach has been taken outside of Nordic countries.
Consolidated balance sheet (unaudited)
(thousand EUR) |
31.12.2017 |
31.12.2016 |
ASSETS |
|
|
Current assets |
|
|
Cash and cash equivalents |
1 037 |
2 805 |
Term deposits |
36 |
51 |
Trade and other receivables |
9 917 |
7 468 |
Corporate income tax receivable |
4 |
0 |
Inventories |
2 832 |
2 770 |
Total current assets |
13 827 |
13 094 |
Non-current assets |
|
|
Trade and other receivables |
1 750 |
982 |
Deferred tax asset |
47 |
34 |
Investments in joint ventures |
2 372 |
2 435 |
Investments in associates |
354 |
591 |
Property, plant and equipment |
12 189 |
12 722 |
Intangible assets |
45 419 |
44 310 |
Total non-current assets |
62 130 |
61 074 |
TOTAL ASSETS |
75 957 |
74 168 |
LIABILITIES |
|
|
Current liabilities |
|
|
Borrowings |
166 |
2 313 |
Trade and other payables |
8 095 |
7 170 |
Corporate income tax payable |
111 |
108 |
Total current liabilities |
8 372 |
9 591 |
Non-current liabilities |
|
|
Long-term borrowings |
15 091 |
13 471 |
Deferred tax liability |
0 |
33 |
Total non-current liabilities |
15 091 |
13 504 |
TOTAL LIABILITIES |
23 463 |
23 095 |
EQUITY |
|
|
Minority interest |
68 |
0 |
Capital and reserves attributable to equity holders of parent company: |
|
|
Share capital |
17 878 |
17 878 |
Share premium |
14 277 |
14 277 |
Treasury shares |
(22) |
(863) |
Reserves |
1 531 |
2 058 |
Retained earnings |
18 762 |
17 723 |
Total capital and reserves attributable to equity holders of parent company |
52 426 |
51 073 |
TOTAL EQUITY |
52 494 |
51 073 |
TOTAL LIABILITIES AND EQUITY |
75 957 |
74 168 |
Consolidated statement of comprehensive income (unaudited)
(thousand EUR) |
Q4 2017 |
Q4 2016 |
12 months 2017 |
12 months 2016 |
Sales revenue |
15 016 |
14 743 |
54 070 |
53 324 |
Cost of sales |
(11 900) |
(11 163) |
(42 869) |
(42 122) |
Gross profit |
3 115 |
3 580 |
11 201 |
11 202 |
Other income |
471 |
579 |
1 189 |
1 085 |
Marketing expenses |
(821) |
(770) |
(2 898) |
(2 488) |
Administrative expenses |
(1 884) |
(1 446) |
(5 921) |
(5 357) |
Other expenses |
(42) |
(54) |
(97) |
(114) |
Gain from selling business assets |
194 |
0 |
194 |
0 |
Operating profit |
1 034 |
1 889 |
3 669 |
4 328 |
Interest income |
36 |
7 |
173 |
32 |
Interest expense |
(97) |
(114) |
(400) |
(471) |
Foreign exchange gains (losses) |
(4) |
(6) |
(11) |
(10) |
Other finance costs |
174 |
(10) |
129 |
(56) |
Net finance cost |
108 |
(123) |
(109) |
(505) |
Profit/(loss) on shares of joint ventures |
(233) |
210 |
(2) |
772 |
Profit/(loss) from shares of associates |
(17) |
72 |
(68) |
113 |
Profit before income tax |
892 |
2 047 |
3 490 |
4 708 |
Income tax expense |
(190) |
(180) |
(344) |
(302) |
Net profit for the reporting period |
703 |
1 868 |
3 146 |
4 406 |
Net profit for the reporting period attributable to: |
|
|
|
|
Equity holders of the parent company |
696 |
1 868 |
3 140 |
4 406 |
Minority shareholders |
6 |
0 |
6 |
0 |
Other comprehensive income |
0 |
0 |
0 |
0 |
Total comprehensive income |
703 |
1 868 |
3 146 |
4 406 |
Comprehensive income for the reporting period attributable to: |
|
|
|
|
Equity holders of the parent company |
696 |
1 868 |
3 140 |
4 406 |
Minority shareholders |
6 |
0 |
6 |
0 |
Basic and diluted earnings per share |
0.02 |
0.06 |
0.11 |
0.15 |
Consolidated cash flow statement (unaudited)
(EUR thousand) |
12 months 2017 |
12 months 2016 |
Cash flows from operating activities |
|
|
Operating profit for the reporting year |
3 669 |
4 328 |
Adjustments for: |
|
|
Depreciation, amortisation and impairment |
2 787 |
2 953 |
Gain from selling business assets |
(194) |
0 |
(Gain)/loss on sale and write-down of property, plant and equipment |
(11) |
37 |
Change in value of share option |
0 |
136 |
Cash flows from operating activities: |
|
|
Trade and other receivables |
(105) |
(709) |
Inventories |
(62) |
(53) |
Trade and other payables |
(497) |
484 |
Cash generated from operations |
5 587 |
7 175 |
Income tax paid |
(371) |
(293) |
Interest paid |
(448) |
(519) |
Net cash generated from operating activities |
4 769 |
6 363 |
Cash flows from investing activities |
|
|
Acquisition of subsidiaries (less cash acquired) |
(546) |
0 |
Acquisition of joint ventures |
0 |
(868) |
Acquisition of associate |
(74) |
(311) |
Purchase and receipts of other investments |
(785) |
5 |
Proceeds from sale of business assets |
130 |
0 |
Interest received |
169 |
32 |
Purchase of property, plant and equipment |
(2 023) |
(1 335) |
Proceeds from sale of property, plant and equipment |
12 |
39 |
Loans granted |
(2 227) |
(25) |
Loan repayments received |
1 054 |
175 |
Net cash used in investing activities |
(4 290) |
(2 289) |
Cash flows from financing activities |
|
|
Dividends paid |
(1 787) |
(1 456) |
Dividend received from associates and joint ventures |
56 |
246 |
Finance lease repayments |
(71) |
(72) |
Change in use of overdraft |
92 |
0 |
Loan received |
0 |
11 |
Repayments of bank loans |
(552) |
(2 186) |
Purchase of treasury shares |
0 |
(687) |
Net cash used in financing activities |
(2 261) |
(4 144) |
NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS |
(1 782) |
(71) |
Cash and cash equivalents at the beginning of the year |
2 856 |
2 927 |
Cash and cash equivalents at the end of the year |
1 073 |
2 856 |
Additional information: Mari-Liis Rüütsalu Chairman of the Management Board GSM: +372 512 2591 e-mail: mariliis.ryytsalu@egrupp.ee
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