Sanoma Oyj · OMXHEX:SANOMA

Sanoma Oyj — Q3 2015 Earnings Presentation

36 slides from Sanoma Oyj's earnings presentation, Oct 29, 2015

  1. Slide 1: Q3 2015 Interim Report

    Q3 2015 Interim Report Susan Duinhoven, President and CEO Kim Ignatius, CFO 29 October 2015

  2. Slide 2: CEO's First Impressions of Sanoma

    CEO’s First Impressions of Sanoma Sanoma’s strengths:  Dedicated people  Strong local brands  Great content  Superior reach Opportunities:  Fulfil customer needs in selected brands/domains  Data-driven advertising solutions  Cost innovation 2 29 October 2015 Q3 2015 Interim Report

  3. Slide 3: Challenging Advertising Markets

    Challenging Advertising Markets Good improvement in Dutch advertising market – Finland continues to be subdued Netherlands FY/’14 Q1/’15 Q2/’15 Q3/’15 Newspapers -4 -4 -4 -4 Magazines -12 -15 -18 -18 TV +2 -4 -6 +11 Radio +3 +1 +1 +1 Online +11 +10 +4 +9 Total market* +4 +2 -1 +4 Finland FY/’14 Q1/’

  4. Slide 4: Sanoma – The Big Picture

    Sanoma – The Big Picture Media Finland Media BeNe Learning Turnaround Domain approach Digital ahead gaining momentum transformation proceeding well TV & radio • FTA profitability at good level Net sales* Net sales* Net sales* • VOD offering to be widened EUR 590 million EUR 840 million EUR 290 milli

  5. Slide 5: Media Finland – Unique Cross-Media Position

    Media Finland – Unique Cross-Media Position Strong customer connection across media groups Strong customer connection Unique cross-media position Reach #1 in daily newspapers 1 million 12,000 2 #1 in tabloids >3 million paying B2B customers newspapers Finns customers (>90%) #2 TV network monthly 4 F

  6. Slide 6: Unique Cross-Media Position – Fulfil Customer Needs in Selected Domains

    Unique Cross-Media Position – Fulfil Customer Needs in Selected Domains Consumers Examples of brands Targets Quality and Growth in video Largest reach Expanding Leadership in digital reach and digital and high-quality partnerships classifieds’ leadership entertainment B2B products market in news mar

  7. Slide 7: Cost Savings Programme Implemented

    Cost Savings Programme Implemented  EUR 50 million savings programme announced on 25 August 2015 – Vast majority of savings in Media Finland and to be realised by end of 2016  Savings programme will cover following areas: – Distribution and Printing – Content creation – Marketing and Sales – Suppo

  8. Slide 8: Key Priorities

    Key Priorities Fulfil customer Utilise growth Accelerate Increase needs in and digital cost innovation financial selected transformation flexibility brands/ opportunities domains in Learning 8 29 October 2015 Q3 2015 Interim Report

  9. Slide 9: Financials

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  10. Slide 10: Q3 2015 in Brief – Profitability at Prior Year's Level

    Q3 2015 in Brief – Profitability at Prior Year’s Level  Net sales, organic growth -0.4%, EUR 458.8 million (477.8)  EBIT excluding non-recurring items, EUR 62.5 million (62.1) – Media BeNe – Cost savings, smaller portfolio and domain approach pay off. In addition, strong TV market supported improv

  11. Slide 11: Net Sales Development

    Net Sales Development Q3 2015 7–9/2015 7–9/2014 7–9/2015 EUR million EUR million organic growth, % Media Good growth in TV sales. Net sales grew BeNe: when normalised for the current portfolio. Group 458.8 477.8 -0.4 Absolute sales impacted by divestments Media BeNe 196.4 203.6 -0.3 and closures of

  12. Slide 12: EBIT Excluding Non-Recurring Items Development

    EBIT Excluding Non-Recurring Items Development Q3 2015 EUR million 7–9/2015 7–9/2014 Media + Solid quarter for SBS in positive TV BeNe: advertising market Group 62.5 62.1 + Cost efficiency as a result of smaller portfolio and domain approach Media BeNe 20.1 13.9 - Divestment of magazines in Belgium

  13. Slide 13: Income Statement

    Income Statement Reported figures impacted by multiple divestments EUR million 7–9/2015 7–9/2014 1–9/2015 1–9/2014 1–12/2014 Net sales 458.8 477.8 1,307.8 1,449.1 1,901.6 EBITDA excl. non-recurring items 125.5 119.3 300.6 318.2 392.0 of net sales 27.4% 25.0% 23.0% 22.0% 20.6% Amortisations related t

  14. Slide 14: Free Cash Flow

    Free Cash Flow Cash flow from operations less cash CAPEX EUR million 7–9/2015 7–9/2014 1–9/2015 1–9/2014 1–12/2014 EBITDA excl. non-recurring items 125.5 119.3 300.6 318.2 392.0 TV programme costs -60.5 -51.5 -151.5 -137.7 -184.7 Prepublication costs -7.4 -7.2 -21.7 -21.5 -28.5 Change in working cap

  15. Slide 15: Capital Structure

    Capital Structure 30 September 2015  Net debt: EUR 852 million (Q3 2014: 825) Key figures – Net debt / EBITDA adjusted 6.1 times (4.5) Net debt (lhs) Net debt / EBITDA* (rhs)  *EBITDA adjusted: 12-month rolling EBITDA excl. non- 1000 950 7 920 930 recurring items, where acquired operations are inc

  16. Slide 16: Additional Amortisations of TV rights in Q4 2015

    Additional Amortisations of TV rights in Q4 2015  As part of ongoing review of TV rights, initial valuation done for programme rights in the Netherlands  Changes in competitive environment and consumer habits will lead to devaluation especially of international fiction – In the beginning of 2015 S

  17. Slide 17: Group Outlook for 2015 Unchanged

    Group Outlook for 2015 Unchanged Outlook 2014 1–9/2015 2015 actuals actuals Outlook (published on 16 July 2015) Net sales growth EUR 1,901.6 million, EUR 1,307.8 million, “Around previous year’s (organic) organic growth organic growth development -3.7% -3.7% (2014: -3.7%)” Operating profit margin, E

  18. Slide 18: Q&A

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  19. Slide 19: Appendix

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  20. Slide 20: Summary of Operating Performance

    Summary of Operating Performance Last 12 months* – New media sales: EUR 570 million in Media Finland and Media BeNe Three Strategic Business Units Media Finland Media BeNe Learning Other** TV & Radio Net sales EUR 340 million Magazines Net sales EUR 560 million Online & Mobile Net sales Q4/2014 – Q3

  21. Slide 21: Consumer Confidence

    Consumer Confidence 30 8.8 20 10 0 7.5 -10 -20 -30 -40 Sep Sep Sep Sep Sep May May May May May Mar Nov Mar Nov Mar Nov Mar Nov Mar Jan Jul Jul Jul Jul Jul Jan Jan Jan Jan 2011 2012 2013 2014 2015 Netherlands Finland Source: Eurostat 21 29 October 2015 Q3 2015 Interim Report

  22. Slide 22: Net Sales Development

    Net Sales Development 1–9/2015 1–9/2015 1–9/2014 1–9/2015 Media Net sales declined mainly due to divestments of EUR million EUR million organic growth, % BeNe: non-focus magazine titles as well as lower print Group 1,307.8 1,449.1 -3.7 advertising sales. TV sales increased, supported by higher marke

  23. Slide 23: EBIT Excluding Non-Recurring Items Development

    EBIT Excluding Non-Recurring Items Development 1–9/2015 EUR million 1–9/2015 1–9/2014 Media + Cost efficiency Group 92.1 124.4 BeNe: + SBS TV operations + Focus on smaller portfolio and domain Media BeNe 53.0 47.8 approach Media Finland -2.6 17.9 Media + Cost savings Learning 69.6 78.6 Finland: - Pr

  24. Slide 24: Net Sales Split

    Net Sales Split Rolling 12 months Media operations Learning Netherlands and Finland 87% of net sales Diversified portfolio with several key markets 46% 34% 41% 27% 15% 12% 12% 8% 4% 1% Netherlands Finland Belgium Other Netherlands Poland Finland Belgium Sweden International Consumer media (BeNe and

  25. Slide 25: Media BeNe

    Media BeNe Key figures 2015 2014 2013 EUR million Q3 Q2 Q1 FY 2014 Q4 Q3 Q2 Q1 FY 2013 Net sales 196.4 216.0 189.5 870.8 241.5 203.6 231.7 194.0 896.8 Digital 70.6 83.9 67.1 308.6 90.3 67.8 84.6 65.9 305.3 Online & mobile 19.8 21.6 20.9 87.2 24.9 20.1 21.8 20.4 90.3 TV 50.8 62.3 46.2 221.4 65.4 47.7

  26. Slide 26: Media Finland

    Media Finland Key figures 2015 2014 2013 EUR million Q3 Q2 Q1 FY 2014 Q4 Q3 Q2 Q1 FY 2013 Net sales 131.9 145.7 143.0 637.2 165.5 148.0 164.6 159.0 675.4 Digital 46.6 56.9 50.0 198.7 53.2 43.5 53.4 48.6 185.9 Online & mobile 22.1 25.7 21.9 84.8 23.2 18.3 22.1 21.3 74.7 TV & radio 24.6 31.2 28.0 113.

  27. Slide 27: Learning

    Learning Key figures 2015 2014 2013 EUR million Q3 Q2 Q1 FY 2014 Q4 Q3 Q2 Q1 FY 2013 Net sales 121.8 97.9 37.4 292.0 30.9 113.0 106.9 41.2 304.6 Netherlands 27.5 39.9 21.5 98.1 8.3 24.6 40.7 24.5 95.3 Poland 57.2 12.8 6.6 86.8 12.6 51.1 17.8 5.2 83.8 Finland 11.0 25.5 3.8 48.3 4.1 10.6 28.8 4.8 53.5

  28. Slide 28: TV – Net Sales and EBIT Seasonality

    TV – Net Sales and EBIT Seasonality 2010–2014 average for Dutch and Finnish TV* Net sales split EBIT** split 5% 22% 29% 30% 44% 29% 20% 20% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 *Includes SBS Netherlands (excluding PPA amortization) and Nelonen Media Finland. **Excluding non-recurring items. 28 29 October 2015 Q3

  29. Slide 29: Magazines – Net Sales and EBIT Seasonality

    Magazines – Net Sales and EBIT Seasonality 2010–2014 average for Dutch and Finnish Magazines* Net sales split EBIT** split 18% 23% 27% 29% 28% 26% 24% 24% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 *Includes Dutch and Finnish operations, excluding TV guides. 2010-2012 not restated with IFRS 11 ‘Joint Arrangements’. **

  30. Slide 30: Newspapers – Net Sales and EBIT Seasonality

    Newspapers – Net Sales and EBIT Seasonality 2010–2014 average for Newspapers (Finland) incl. digital business Net sales split EBIT* split 26% 25% 23% 30% 19% 24% 25% 29% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 *Excluding non-recurring items. 30 29 October 2015 Q3 2015 Interim Report

  31. Slide 31: Learning – Net Sales and EBIT Seasonality

    Learning – Net Sales and EBIT Seasonality 2010–2014 average for Learning Net sales split EBIT* split in relative terms 12% 13% 35% 40% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 *Excluding non-recurring items. 31 29 October 2015 Q3 2015 Interim Report

  32. Slide 32: Sanoma – Largest Shareholders

    Sanoma – Largest Shareholders % of shares 30 September 2015 and votes 1. Jane and Aatos Erkko Foundation 23.18 23.2% 2. Antti Herlin 10.79 (Holding Manutas Oy: 10.77%, personal: 0.02%) 3. Robin Langenskiöld 7.54 4. Rafaela Seppälä 6.31 5. Helsingin Sanomat Foundation 3.50 48.7% 6. Ilmarinen Mutual P

  33. Slide 33: Analyst Coverage

    Analyst Coverage  Carnegie  Handelsbanken  Nordea Investment Bank Capital Markets Sami Sarkamies Matti Riikonen Rasmus Engberg tel. +358 9 165 59928 tel. +358 9 6187 1231 tel. +46 8 701 5116 Nordea.com/markets Carnegie.fi Handelsbanken.com/ capitalmarkets  Pohjola  Danske Markets Equities Kimmo

  34. Slide 34: Sanoma's IR Team

    Sanoma’s IR Team Mr Olli Turunen tel. +358 40 552 8907 olli.turunen@sanoma.com Mr Pekka Rouhiainen tel. +358 40 739 5897 pekka.rouhiainen@sanoma.com 34 29 October 2015 Q3 2015 Interim Report

  35. Slide 35: Important Notice

    Important Notice The information above contains, or may be deemed to contain, forward-looking statements. These statements relate to future events or future financial performance, including, but not limited to, expectations regarding market growth and development as well growth and profitability of

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