Alma Media Oyj · OMXHEX:ALMA
Alma Media Oyj — Non-Deal Roadshow (September 2014)
39 slides from Alma Media Oyj's roadshow presentation, September 2014
Slide 1: Driving transformation in media
Driving transformation in media Alma Media investor presentation Kai Telanne, President & CEO | Rauno Heinonen, VP, Comms & IR August – September 2014
Slide 2: A traditional media company?
A traditional media company? Alma Media is investing in fast-growing and profitable digital media and services, with a European focus. At the same time the company is boosting the multi-channel user experience and improving the cost efficiency of its traditional printed newspaper business based in F
Slide 3: Increasingly digital, internationally growing media company
Increasingly digital, internationally growing media company Revenue 2013 Revenue 2013 by geography by source Digital media and services Other 28 % 14 % 300 MEUR Printed Finland media 86 % and other 72 % Inter- 13 15 18 36 41 national revenue 295 296 298 284 259 Revenue from Finland 2009 2010 2011 20
Slide 4: 4 businesses in transition to digital
4 businesses in transition to digital DIGITAL CONSUMER SERVICES Career services, Housing and car marketplaces, Lifestyle services 31.4 % Share of digital Group revenue 2013 business in group revenue 300 meur Q2 2014 FINANCIAL MEDIA Share of digital business AND BUSINESS SERVICES in segment revenue E
Slide 5: Alma Media’s businesses
Alma Media’s businesses Digital Financial Media National Regional Media Consumer and Business Consumer Services Services Media 31 newspapers Revenue 2013 MEUR 147.1 Revenue 2013 MEUR 52.6 Revenue 2013 MEUR 56.8 Revenue 2013 MEUR 49.0 Q2 Revenue MEUR 37.2 Q2 Revenue MEUR 14.0 Q2 Revenue MEUR 13.1 Q2
Slide 6: Regional Media
Revenue 2013 MEUR 147.1 Q2 Revenue MEUR 37.2 Regional Media EBIT 2013 MEUR 9.8 (6.6%) EBIT Q2 MEUR 3.0 (8.0%) Online sales 2013 MEUR 2.6 (1.8%) Online sales Q2 MEUR 0.9 (2.5%) • Regional Media includes: • 31 newspapers of Alma Regional Media and the Group’s printing and distribution company Alma Man
Slide 7: Financial Media and Business Services
Revenue 2013 MEUR 56.8 Q2 Revenue MEUR 13.1 Financial Media and Business Services EBIT 2013 MEUR 7.8 (13.8%) EBIT Q2 MEUR 1.3 (10.1%) Online sales 2013 MEUR 19.0 (33.4%) Online sales Q2 MEUR 5.6 (42.6%) • The Financial Media and Business Services segment specialises in the production of financial in
Slide 8: National Consumer Media
Revenue 2013 MEUR 49.0 National Consumer Media Q2 Revenue MEUR 12.7 EBIT 2013 MEUR 4.7 (9.6%) EBIT Q2 MEUR 1.7 (13.1%) Online sales 2013 MEUR 10.5 (21.5%) Online sales Q2 MEUR 3.7 (28.8%) • The National Consumer Media segment reports the various publishing services of IL-Media, including the largest
Slide 9: Digital Consumer Services
Revenue 2013 MEUR 52.6 Q2 Revenue MEUR 14.0 Digital Consumer Services EBIT 2013 MEUR 9.4 (17.8%) EBIT Q2 MEUR 2.5 (18.1%) Online sales 2013 MEUR 52.6 (100%) Online sales Q2 MEUR 14.0 (100%) • Digital Consumer Services include: • Alma Diverso and Marketplaces • Services operating in Finland are: • Et
Slide 10: Growth in digital business
Growth in digital business Segment’s share of the Group’s 90 35% digital revenue 32,0 % 80 28,1 % 30% 3.8 % 15.3 % 70 24,3 % 25% 60 50 18,0 % 20% 57.7 % 23.2 % MEUR 15,7 % 40 84 12,9 % 13,1 % 78 15% 30 57 10% 49 48 20 44 40 Regional Media National Consumer Media 5% Financial Media and Business Servi
Slide 11: Ownership and share facts
Ownership and share facts Shareholders by sector Largest shareholders 31.7.2014 1. Ilkka-Yhtymä Oyj 29.79 % 2. Mariatorp Oy 14.64 % 3. Kaleva Kustannus Oy 7.95 % General Government Nominee registered 4. Varma (pension fund) 7.06 % Finance Households 5. C.V.Åkerlund 4.53 % Corporations On shared acco
Slide 12: Market development in Finland
Market development in Finland
Slide 13: Advertising volumes in Finland follow GDP
Advertising volumes in Finland follow GDP 15% 10% 5% 0% -5% -10% -15% -20% 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Annual GDP change Annual advertising volume change Sources: Statistics Finland, Finnish Advertising Counc
Slide 14: Advertising share of Finnish GDP at record low
14 % 0,4 0,5 0,6 0,7 0,8 0,9 1 6 May 2014 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Advertising share of Finnish GDP at record low
Slide 15: Change in media advertising 6/2013–6/2014
Change in media advertising 6/2013–6/2014 30% 25% Change (%) YTD 6/14 vs. 6/13 20% 15% News- papers -8.3 10% 5% Magazines -14.8 0% TV -5.2 -5% -10% Radio +10.5 -15% Internet +13.8 -20% Total -3.6 -25% Advertising sales total, chg % Newspaper advertising, chg % Internet advertising, chg % Source: TNS
Slide 16: Advertising declined across all industries
Advertising declined across all industries Advertising by branch Q1-Q2 / 2014 Total market, change from Q1-Q2 2013 Advertising in Q1-Q2 14 MEUR Retail -7.1 % Retail 109 Food & bev. -0.3 % Food & beverages 51 Motor v. -5.3 % Motor vehicles 47 Houses -0.7 % Houses and premises 24 Tourism -4.3 % Touris
Slide 17: Structural change in media advertising
Structural change in media advertising MEUR 800 Newspapers Magazines 700 Printed catalogues 600 Television Online 500 Radio 400 Cinema Out-of-home 300 200 100 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 17 6 May 2014
Slide 18: Transformation strategy
Transformation strategy
Slide 19: Evolution may not be enough.
Evolution may not be enough. Rapid changes in technology and consumer behaviour require reallocation of resources and focus on new products and services. We also need the courage to relinquish some things we have done before.
Slide 20: Strategy: key must-win-battles
Strategy: key must-win-battles Accelerate growth in digital services and media Improve the user experience and cost efficiency of the printed newspaper business. 20 6 May 2014
Slide 21: Strategy: implementation focus areas
Strategy: implementation focus areas Multi-channel Marketing Resources and Digital services content solutions competencies We will build new competencies, seek efficiencies and accelerate growth in digital services and media. 21 6 May 2014
Slide 22: Multi-channel content Implementation examples
Strategy implementation Multi-channel content Market drivers Implementation examples The usage of digital Content revenues media content moves to 24/7, driven by mobile • Kauppalehti subscription model operative from May 2013, and video. digital content sales at strong growth since. All digital Onli
Slide 23: Marketing solutions Implementation examples
Marketing solutions Market drivers Implementation examples Advertisers with limited Content marketing budgets are seeking for the highest marketing • Kauppalehti Studio as a turn-key content marketing ROI solution by Kauppalehti & Alma360. Investments in own and • Iltalehti ILab: content marketing c
Slide 24: Digital services Implementation examples
Digital services Market drivers Implementation examples Recruitment Classified advertising moves to digital • Alma Media has invested more than 70 MEUR into very successful online recruitment services in Central Europe. People seek solutions to various everyday Alma Media services are market leaders
Slide 25: Resources and competencies
Resources and competencies Market drivers Implementation examples Digital skills Media companies are becoming increasingly • Recruitment of digital expertise technical, thus the skills Investments into digital development base need to transformed to contain • Operative IT systems, such as CRM origin
Slide 26: We are building a round-the-clock media consumption experience
We are building a round-the-clock media consumption experience based on extensive analysis of our customers’ preferences and media usage.
Slide 27: By the year 2020, 50% of Alma Media’s revenue comes from digital.
By the year 2020, 50% of Alma Media’s revenue comes from digital.
Slide 28: Long-term financial targets
Long-term financial targets Alma 2011 2012 2013 2014 2014 Target Media’s YTD Q2 level financial targets Digital 16.3% 36.8% 8.4% 12.2% 13.4% > 15% business growth Return on 26.1% 13.8% 10.1% 8.6% 12.0% > 15% Investment (ROI), % Dividend 103% 45% 50% n/a n/a > 50% payout ratio* * Includes capital rep
Slide 29: Key financials
Key financials
Slide 30: Revenue and operating profit 2009–2013
Revenue and operating profit 2009–2013 Revenue, MEUR Operating profit, MEUR IFRS IFRS -27,8% -6,2% 350 50 300 311,4 316,2 320,1 43,9 307,8 300,2 40 42,9 42,6 250 30 33,5 2,8 200 20 24,2 150 10 100 50 0 -2,2 -0,5 -1,0 0 -7,0 -10 2009 2010 2011 2012 2013 2009 2010 2011 2012 2013 Kertaluonteiset Non-re
Slide 31: Operating profit increased in the second quarter
Operating profit increased in the second quarter Revenue, MEUR Operating profit, MEUR IFRS -0.9% IFRS 90 -2.9% 12 -54.8% 80 10 +37.3% 70 76.3 77.3 75.7 71.7 72.7 8 0.0 60 4.9 7.8 6 50 6.4 6.3 4 4.6 40 0.7 2 30 2.5 20 0 -0.2 -2.0 10 -2 0 -4 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14
Slide 32: Cash flow from operating activities
Cash flow from operating activities 16,7 25.0 20.0 0.3 15.0 10.0 MEUR 5.0 0.3 3.0 0.0 -4.2 -5.0 -10.0 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14
Slide 33: Interest-bearing debt
Interest-bearing debt Net debt Q2/2011-Q4/2013 Breakdown of net debt 120 Q1/2014 100 103,5 104,1 101,4 97,6 Financial leasing 74.0 80 82,1 Financing loans 10,0 60 Commercial 12.0 MEUR 40 papers 42,2 Cash and cash -13.9 20 equivalents 0 Total 82.1 -20 -40 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2
Slide 34: Key indicators
Key indicators IFRS Equity ratio, % Gearing, % 45 140 40 120 38.9 119.3 35 32.9 100 30 25 80 82.1 20 60 15 40 10 20 5 0 0 Q2 13 Q2 14 Q2 13 Q2 14
Slide 35: Earnings per share and equity per share
Earnings per share and equity per share 0,06 1,2 0,05 1,03 1,04 0,05 1,0 0,04 0,33 0,34 0,8 0,03 0,02 0,05 0,6 0,02 0,01 0,4 0,01 0,70 0,70 0,01 0,2 0,00 0,00 -0,01 0,0 Q1 13 Q1 14 Q1 13 Q1 14 Non-recurring items Retained earnings EPS wo non-recurring items Restricted equity 35 6 May 2014
Slide 36: Earnings per share and equity per share
Earnings per share and equity per share 0.12 1.2 1.12 0.10 1.09 0.10 1.0 0.42 0.39 0.08 0.8 0.06 0.06 0.06 0.6 0.04 0.06 0.4 0.02 0.70 0.70 0.04 0.2 0.00 0.00 -0.02 0.0 Q2 2013 Q2 2014 Q2 2013 Q2 2014 Non-recurring items Retained earnings EPS wo non-recurring items Restricted equity
Slide 37: Balance sheet
Balance sheet MEUR Q2 2014 Q2 2013 Intangibles and goodwill 114.8 116.4 Tangibles 83.2 87.9 Associated companies 24.9 31.0 Inventory 1.1 0.7 Receivables 33.8 37.8 Cash 13.6 12.4 Assets 271.3 286.2 Equity 97.1 86.8 Reserves-obligatory 3.9 3.9 Pension liabilities 2.9 2.8 Ib debt 93.3 116.0 Non-Ib debt
Slide 38: Outlook
Outlook 18 July 2014 Economic growth in Europe, and in particular Finland, is expected to remain weak also in the second half of 2014. In this market situation, Alma Media’s strong growth in digital service revenue does not yet fully offset the decline in the sales of print media. Alma Media expects
Slide 39: Thank you! Questions?
Thank you! Questions? Upcoming events in the investor calendar: - Q3 result 24 October 2014