Sanoma Oyj · OMXHEX:SANOMA

Sanoma Oyj — Investor Presentation (February 2017)

39 slides from Sanoma Oyj's investor presentation, February 2017

  1. Slide 1: Investor presentation February 2017

    Investor presentation February 2017

  2. Slide 2: Contents

    Contents  About Sanoma  FY & Q4 2016 Result  Three Strategic Business Units  Appendix 2 February 2017 Investor Presentation

  3. Slide 3: Sanoma: Three Strategic Business Units

    Sanoma Three Strategic Business Units TV & Radio Media Media Learning Net sales EUR 350 million Finland BeNe Magazines 2016 2016 2016 Net sales EUR 460 million Net sales Net sales Net sales EUR 580 million EUR 780 million EUR 280 million Online & Mobile Digital/hybrid/services Non-print 42% (240 Non

  4. Slide 4: Strong Brands, Great Content, Loyal Customers

    Strong Brands, Great Content, Loyal Customers TV/Radio News/ Magazines Learning Classifieds

  5. Slide 5: Elements of Sanoma's Transformation

    Elements of Sanoma’s Transformation Tailoring to Digitalisation is From content orientation to User customers not a goal, it is customer and data experience requires a way of orientation: big cultural shift and customer superior data serving from our journalistic service critical and analysis herita

  6. Slide 6: 2016: Back on track faster than expected

    Full year operational EBIT, MEUR 2016: Back on track 100 80 faster than expected 60 64 86 2015 2016 40 57 50 45 20 Sanoma Group 0 13 EUR million 2016 2015 -20 -24 Net sales 1,639.1 1,716.7 -38 -40 Media Finland Media BeNe Learning Other Organic growth 0.1% -3.4% Operational EBIT 167.9 83.7 Compositi

  7. Slide 7: Increasing dividend, renewed long-term financial targets

    Increasing dividend Renewed long-term New dividend policy financial targets  For 2016, Board proposes dividend of New target Old target EUR 0.20 (0.10) per share. Net debt / EBITDA < 2.5 < 3.5 Equity ratio 35%-45% 35%-45%  The dividend policy from 2017 onwards: Sanoma aims to pay an increasing div

  8. Slide 8: Progress in Key Strategic Priorities

    Progress in Key Strategic Priorities Fulfil customer Utilise growth Accelerate cost Improve cash needs in selected and digital innovation conversion media brands transformation and and domains opportunities deleverage our in Learning business Growth from cross- Growth in Western Suunta in Finland, D

  9. Slide 9: Outlook for 2017

    Outlook for 2017  For 2017, Sanoma expects that the Group’s consolidated – Net Sales adjusted for structural changes will be stable and – The operational EBIT margin will be around 10%  The outlook is based on the assumption of the advertising market development in Finland and the Netherlands bein

  10. Slide 10: FY & Q4 2016 Result

    FY & Q4 2016 Result

  11. Slide 11: 2016: Back on track

    Photo: HS Kuukausiliite 8/2016 2016: Back on track  Q4: Operational EBIT improvement continued EUR 1.4 million (-8.4)  FY2016: – Operational EBIT doubled to EUR 168 million (84) – Organic net sales stable (+0.1%) – Deleveraging continued as planned: net debt / adj. EBITDA 3.2 (5.1) after redemptio

  12. Slide 12: Media Advertising Markets

    Media Advertising Markets Netherlands Q1/16 Q2/16 Q3/16 Q4/16 FY/15 FY/16 Magazines -8% -8% -9% -3% -13% -7% TV +6% -2% -5% -5% +1% -2% Online* +10% +14% +8% +8% +8% +10% Total market* +4% +4% +1% +1% +1% +3% Finland Q1/16 Q2/16 Q3/16 Q4/16 FY/15 FY/16 Newspapers -6% -5% -3% -4% -6% -4% Magazines -1

  13. Slide 13: FY16 Media BeNe

    FY16 Media BeNe Composition of net sales 2016 Improved performance in Advertising sales 22% print & online portfolio Single copy sales 41% Subscription sales 22%  Operational EBIT up by 34% with all Other* business units contributing 15% – Improvement driven by organic sales *Other sales mainly inc

  14. Slide 14: FY16 Media Finland

    FY16 Media Finland Composition of net sales 2016 9% Transformation ahead of plan Advertising sales Single copy sales 46%  Operational EBIT improved to EUR 50 Subscription sales 37% million (13), all business units contributing Other* – Driven by advertising sales as well as cost and 8% process inno

  15. Slide 15: FY16 Learning

    FY16 Learning Net sales by country 2016 Solid net sales and significant Netherlands Finland 25% 33% profitability improvement Sweden Belgium 16%  Clear improvement in profitability, Poland 17% operational EBIT +27% 9% – Cost innovations, prepublication amortisation schedule changes and De Boeck con

  16. Slide 16: Operational EBIT 2016 doubled

    Operational EBIT 2016 doubled EUR million 10–12/2016 10–12/2015 1–12/2016 1–12/2015 Slight Improvement in Finland Net sales 398.1 409.3 1,639.1 1,716.7 Operational EBITDA 86.7 89.1 452.4 389.7 Amortisations related to TV programme rights -53.8 -51.5 -180.9 -186.2 Amortisations related to prepublicat

  17. Slide 17: Sanoma cost structure improved

    Sanoma cost structure improved Operational fixed cost split (EUR million) Net sales and operational cost structure and share of net sales 2015: 2016: 48 % 44% 1,717 MEUR 1,639 MEUR EUR million % 900 55 Other 800 53 51 Rents 2015 84 700 168 49 600 47 Office and IT 306 500 45 813 285 713 400 Advertisi

  18. Slide 18: Operational EBIT Development

    Operational EBIT Development Q4/2016 EUR million Q4/2016 Q4/2015 Media BeNe: + Cost innovations + Higher program rights impairment in 2015 Group 1.4 -8.4 - Higher targeted investments to Media BeNe 26.8 10.9 programming - Divestments of non-core, non-strategic Media Finland 9.3 15.6 operations Learn

  19. Slide 19: Improved free cash flow

    Improved free cash flow Cash flow from operations less CAPEX Operational free cash flow (without items effecting comparability) EUR million 10–12/2016 10–12/2015 1–12/2016 1–12/2015 1-12/2016 1-12/2015 Operational EBITDA 86.7 89.1 452.4 389.7 452.4 389.7 TV programme costs -34.1 -46.1 -179.3 -197.6

  20. Slide 20: Successful deleveraging

    Successful deleveraging Key figures Hybrid Bond redeemed 1000 950 7 930 900 845 852 855  Cash flow from operations less capex 800 825 802 801 823 766 786 6 increased to EUR 119 million (-30) 700 5  Net debt: EUR 786 million (801) 600 4 – Net debt/EBITDA* adjusted 3.2 times (5.1) 500 after redempti

  21. Slide 21: Funding

    Funding As of 31.12.2016 Debt structure, MEUR Maturity profile of committed funding, MEUR 2718 12 200 275 Bond 2017 87 Bond 2019 212 SBS Term Loan 1125 340 850 SBS RCF 763 CP Finland 551 551 CP Belgium 200 Other Loans 2016 2017 2018 2019 2020 12 Committed funding Maturing Hybrid Bond 42  Average in

  22. Slide 22: Three Strategic Business Units

    Three Strategic Business Units

  23. Slide 23: Media BeNe - Strong Media Portfolio

    Media BeNe - Strong Media Portfolio Cross-media brands the key differentiator Strong reach in TV, magazines and online Netherlands: TV + Magazines + Digital Media 90% • Dutch and Belgian consumer media 18 >100 9 magazines sites/apps events monthly reach in NL operations and press distribution Aldipr

  24. Slide 24: Media BeNe financials

    Quarterly operational EBIT, MEUR Media BeNe 35 35 2014 2015 2016 30 30 financials 25 25 27 26 27 26 30 30 2014 2015 2016 27 27 20 20 23 23 22 20 22 20 15 15 Media BeNe 2016 2015 10 10 14 14 EUR million 11 11 55 88 Net sales 775.9 829.5 66 77 00 Organic growth 0.5% -1.4% Q1 Q1 Q2 Q2 Q3 Q3 Q4 Q4 Opera

  25. Slide 25: Media BeNe key figures

    Media BeNe key figures EUR Q4/16 Q3/16 Q2/16 Q1/16 Q4/15 Q3/15 Q2/15 Q1/15 FY/16 FY/15 million Net sales 218.0 179.7 202.6 175.6 227.6 196.4 216.0 189.5 775.9 829.5 Digital 97.1 71.4 82.3 68.2 94.9 70.6 83.9 67.1 318.9 316.6 Print 88.9 85.5 92.1 87.1 102.3 102.6 109.4 105.6 353.5 419.9 Other 32.0 22

  26. Slide 26: Media Finland – Unique Reach into Population

    Media Finland – Unique Reach into Population Strong customer connection across media groups Unique cross-media position 96% 2 Newspapers 4 FTA channels 6 Radio channels weekly reach • Leading media company in Finland in total population 15 >100 • Leading brands and services Magazines Sites/apps 1 mi

  27. Slide 27: Media Finland financials

    Quarterly operational EBIT, MEUR Media Finland 35 25 2014 2015 2016 30 financials 20 25 15 26 27 30 19 2014 2015 2016 27 20 23 16 10 20 22 15 11 10 10 9 Media Finland 2016 2015 10 5 8 14 EUR million 2 6 11 50 8 0 6 7 Net sales 580.9 572.8 -2 -3 0-5 Organic growth 0.7% -4.1% Q1 Q1 Q2 Q2 Q3 Q3 Q4 Q4 O

  28. Slide 28: Media Finland key figures

    Media Finland key figures EUR Q4/16 Q3/16 Q2/16 Q1/16 Q4/15 Q3/15 Q2/15 Q1/15 FY/16 FY/15 million Net sales 152.4 133.8 150.1 144.5 152.2 131.9 145.7 143.0 580.9 572.8 Digital 64.0 52.2 63.5 58.3 59.3 46.6 56.9 50.0 237.9 212.8 Print 87.2 80.4 85.9 85.3 92.0 84.8 89.7 90.5 338.9 356.9 Other 1.2 1.3

  29. Slide 29: Learning – Leading in 5 European Countries

    Learning – Leading in 5 European Countries Brand Position Market share • Focus in primary, secondary and vocational Netherlands Malmberg #2 30% education Finland Sanoma #1 60% PRO • One of Europe’s leading learning companies Belgium Van In #1 40% serving 10 million students and one million teachers

  30. Slide 30: Learning financials

    Quarterly operational EBIT, MEUR Learning 3560 50 2014 2015 2016 30 financials 40 2530 26 4127 30 41 44 50 51 2014 2015 2016 27 32 2020 23 Learning 2016 2015 10 20 22 EUR million 15 0 -7 -10 10 -13 -11 14 Net sales 282.6 280.3 -25 -24 -20 5 8 -2711 Netherlands 94.4 95.3 -30 6 7 0 -40 Poland 70.8 83.

  31. Slide 31: Learning key figures

    Learning key figures EUR Q4/16 Q3/16 Q2/16 Q1/16 Q4/15 Q3/15 Q2/15 Q1/15 FY/16 FY/15 million Net sales 28.0 124.7 97.1 32.9 23.7 121.2 98.0 37.5 282.6 280.3 Netherlands 6.5 25.8 42.4 19.7 6.4 27.5 39.9 21.5 94.4 95.3 Poland 8.0 50.1 8.2 4.5 7.7 56.6 12.8 6.7 70.8 83.9 Finland 5.5 14.5 24.9 3.2 3.4 1

  32. Slide 32: Appendix

    Appendix

  33. Slide 33: Consumer Confidence

    Consumer Confidence 22.4 30 20 10 15.0 0 -10 -20 -30 -40 Nov Mar Nov Nov Nov Mar May Jul May Jul Mar May Jul Mar May Jul Sep Sep Sep Sep Jan Jan Jan Jan 2013 2014 2015 2016 Netherlands Finland Source: Eurostat 33 February 2017 Investor Presentation

  34. Slide 34: Learning – Net Sales and EBIT Seasonality

    Learning – Net Sales and EBIT Seasonality 2012–2016 average for Learning Net sales split Operational EBIT split in relative terms 10% 13% 42% 35% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 34 February 2017 Investor Presentation

  35. Slide 35: Sanoma – Largest Shareholders

    Sanoma – Largest Shareholders % of shares 31 January 2017 and votes 1. Jane and Aatos Erkko Foundation 24.46 2. Antti Herlin 11.49 (Holding Manutas Oy: 11.47%, personal: 0.02%) 24,5 % 3. Robin Langenskiöld 7.54 4. Rafaela Seppälä 6.31 5. Helsingin Sanomat Foundation 3.50 46,7 % 6. Ilmarinen Mutual P

  36. Slide 36: 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 Kimmo Stenvall Equities

  37. Slide 37: Sanoma's Investor Relations

    Sanoma’s Investor Relations Ms Anna Tuominen tel. +358 40 584 6944 anna.tuominen@sanoma.com Mr Anssi Imppola tel. +358 40 832 0128 anssi.imppola@sanoma.com 37 February 2017 Investor Presentation

  38. Slide 38: 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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