Sanoma Oyj · OMXHEX:SANOMA
Sanoma Oyj — FY2014 Earnings Presentation
45 slides from Sanoma Oyj's earnings presentation, Feb 5, 2015
Slide 1: Full-Year Result 2014
Full-Year Result 2014 Harri-Pekka Kaukonen, President and CEO Kim Ignatius, CFO 5 February 2015
Slide 2: 2014 ended in line with the outlook provided a year ago
2014 ended in line with the outlook provided a year ago Q4 in brief Sales and EBIT according to plan, leading 2014 to end in line with guidance given in February 2014 Cost savings programme ahead of the original plan – run rate EUR 91 million Russian Fashion Press sold Media Belgium will be
Slide 3: Quick look at Sanoma's strategy in 2014
Quick look at Sanoma’s strategy in 2014 Mission: Get the world – Sanoma helps people access and understand the world Our strategic aspiration Market leader in consumer media and learning in our countries of operation Our strategic goals Growth and transformation Renewal of products and services Grow
Slide 4: Strategic implementation in 2014
Strategic implementation in 2014 Mission: Get the world – Sanoma helps people access and understand the world Our strategic aspiration Market leader in consumer media and learning in our countries of operation Our strategic goals Growth and transformation Renewal of products and services Growth 2016
Slide 5: Main achievements in growth story
Main achievements in growth story Target to return back to organic growth in 2016 Netherlands Sanoma Group - organic growth (%) (rolling 12 months) Sale of 23 titles improves growth profile 8,0 New sales generated around strong brands 6,0 SBS TV viewing share improving 4,0 Finland Good growt
Slide 6: SBS – Additional growth from Champions League in 2015
SBS – Additional growth from Champions League in 2015 2014 viewing share ended in line with 2013 2014 23 2013 despite major sports events Sochi 21 Olympics and FIFA World Cup shown on 19 public channels 17 Excluding months with major events, 15 viewing share increased vs. prior year 13 Sochi FIF
Slide 7: Domain approach paying off – case vtwonen
Domain approach paying off – case vtwonen Sundays 18:30-19:30 on SBS6 10 episodes in 2014 Viewers per episode Leading Dutch home deco brand Voiko näitä jotenkin 550 yhdistää? 470 475 485 505 New sales built around magazine brand 260 380 6: 550k 415 7: 330k 330 375 (TV show / E-commerce / Events)
Slide 8: Good growth in digital sales of news brands Ilta-Sanomat and Helsingin Sanomat
Good growth in digital sales of news brands Ilta-Sanomat and Helsingin Sanomat IS the largest digital service Growth in digital sales in Finland Very strong position in mobile. Mobile sales developing extremely well +19% Strong growth in ISTV video starts and sales 2013 2014 HS on good growth pa
Slide 9: Nelonen Media – growth in TV, VOD and radio
Nelonen Media – growth in TV, VOD and radio New launches strengthen TV portfolio Main channel Nelonen rebranded and renewed New channel Hero reaching new target groups Ice hockey league growing but profitability unfortunately still negative Unique content boosts VOD Entertainment content dri
Slide 10: Learning – highlights of success in 2014
Learning – highlights of success in 2014 Organic sales growth + 1.0% Teacher Online Services platform in Finland reaches 90% Successful new digital tools and services penetration of teachers Emerging markets provide growth Of primary school pupils in opportunity Four deals > EUR 1 million in eme
Slide 11: Strategic implementation in 2014
Strategic implementation in 2014 Mission: Get the world – Sanoma helps people access and understand the world Our strategic aspiration Market leader in consumer media and learning in our countries of operation Our strategic goals Growth and transformation Profitability & balance sheet Cost-savings p
Slide 12: Cost savings programme – EUR 100 million run-rate soon accomplished
Cost savings programme – EUR 100 million will be achieved in advance EUR 100 million run-rate soon Cost savings - annual run rate accomplished 100 EUR million 91 Savings of around EUR 18 million in Q4, 90 cumulative savings in 2014 EUR 55 80 million 70 Run-rate at the end of December was 60 61 E
Slide 13: Significant cash flow from sale of real estate and non-core operations
Significant cash flow from sale of real estate and non-core operations Sold media operations Cash flow from divestments (cumulative) • Belgium (only TV)* 450 EUR million • Bulgaria (all operations) • Croatia (all operations) Media operations Other operations 400 • Czech Republic (all operations) Rea
Slide 14: Strategic implementation in 2014
Strategic implementation in 2014 Mission: Get the world – Sanoma helps people access and understand the world Our strategic aspiration Market leader in consumer media and learning in our countries of operation Our strategic goals Growth and transformation Profitability & balance sheet – ”fund the jo
Slide 15: Major changes in organisation during 2014
Major changes in organisation during 2014 Finnish organizations combined, restructuring and new operation model in multiple business units New talents secured in top management layers New Digital unit + new Head of Digital Renewal of commercial operations, new CCOs in Netherlands and Finland
Slide 16: Key priorities in 2015
Key priorities in 2015 Improve performance of core brands and domains - Commercial excellence, cross-media and data analytics Boost SBS TV operations - Increase revenue and EBIT based on new content, cost savings and market share gains Integration of BeNe operations - Find synergies and leverage ope
Slide 17: Market environment, outlook and dividend
Market environment, outlook and dividend
Slide 18: Market environment remains challenging
Market environment remains challenging Advertising market* change in % vs. prior year Netherlands FY/’11 FY/’12 FY/’13 Q4/’14 FY/’14 Magazines -4 -12 -25 -17 -17 TV +4 -6 -2 -4 +2 Online +9 -1 -3 +11 +13 Total market** +5 -5 -4 +1 +5 Finland FY/’11 FY/’12 FY/’13 Q4/’14 FY/’14 Newspapers +3 -9 -16 -8
Slide 19: Group outlook for 2015 and mid-term
Group outlook for 2015 and mid-term Mid-term (2016) outlook introduced in February 2014 remains unchanged 2014 2015 Mid-term Outlook actuals outlook outlook (2016) Net sales growth EUR 1,901.6 million, ’Around previous year’s ’Return to organic growth’ (organic) organic growth -3.7% development (201
Slide 20: Dividend per share EUR 0.20
Dividend per share EUR 0.20* Dividend per share and dividend yield** Payout ratio (DPS / EPS excluding non-recurring items, %) 6.8% 8.1% 0.60 0.60 77 69 61 4.3% >50% 1.6% 0.20 23 0.10 2011 2012 2013 2014 2011 2012 2013 2014 Dividend policy Sanoma conducts an active dividend policy and primarily pays
Slide 21: Financials
Financials SQN OM CMecauteaelile|
Slide 22: Net sales split 2014
Net sales split 2014 Media Operations Learning Netherlands and Finland 85% of net sales Diversified portfolio with five key markets 43% 42% 34% 30% 17% 15% 12% 9% Netherlands Finland Other Netherlands Poland Finland Belgium Sweden Consumer media (NL and FIN) Learning 42% of net sales in new media (E
Slide 23: Income Statement
Income Statement Restated* Restated* EUR million 10–12/2014 10–12/2013 1–12/2014 1–12/2013 Net sales 452.5 517.5 1,901.6 2,083.5 EBITDA excl. non-recurring items 73.8 99.1 392.0 436.6 of net sales 16.3% 19.1% 20.6% 21.0% Amortisations related to TV programme rights -44.1 -61.3 -159.9 -171.1 Amortisa
Slide 24: Net sales development – Q4 2014
Net sales development – Q4 2014 10–12/2014 10–12/2013 10–12/2014 Media Decline is related to weaker print sales, EUR million EUR million organic growth, % Netherlands: a major part resulting from the sale of Group 452.5 517.5 -4.7 23 titles Media 180.1 194.1 -2.4 Media Decline in net sales is mainly
Slide 25: EBIT excl. non-recurring items development – Q4 2014
EBIT excl. non-recurring items development – Q4 2014 EUR million 10–12/2014 10–12/2013 Media + Cost efficiency Netherlands: + Lower costs in TV programming offset Group -5.6 12.3 lower TV ad sales Media Netherlands 24.4 25.9 - Print sales, partly due to divestments Media Finland 5.6 5.4 - Investment
Slide 26: Free cash flow
Free cash flow Cash flow from operations less cash CAPEX Restated* Restated* EUR million 10–12/2014 10–12/2013 1–12/2014 1–12/2013 EBITDA excl. non-recurring items 73.8 99.1 392.0 436.6 TV programme costs -47.0 -49.7 -184.7 -186.4 Prepublication costs -7.1 -6.7 -28.5 -31.2 Change in working capital
Slide 27: Balance sheet strengthening steadily – some work to be done with Net debt / EBITDA
Balance sheet strengthening steadily – some work to be done with Net debt / EBITDA -ratio Net debt: EUR 802 million (2013: 1,129) Key figures – Net debt / EBITDA adjusted 4.1 times Net debt (lhs) Net debt / EBITDA (rhs) EBITDA adjusted: 12-month rolling EBITDA excl. non- 1600 6 recurring items,
Slide 28: Q&A
&A SQN OM CMecauaelle|
Slide 29: Appendix
Appendix ry ERM aeMiKe] get the world
Slide 30: Consumer confidence
Consumer confidence Netherlands Finland 30 20 10 7.0 0 -10 1.7 -20 -30 -40 2011 2012 2013 2014 30 5 February 2015 Full-Year Result 2014
Slide 31: Net sales development – FY 2014
Net sales development – FY 2014 1–12/2014 1–12/2013 1–12/2014 Media Decline is related to weaker print sales, EUR million EUR million organic growth, % Netherlands: a major part resulting from the sale of Group 1,901.6 2,083,5 -3.7 23 titles Media 652.7 685.8 -2.5 Netherlands Media Decline in net sa
Slide 32: EBIT excl. non-recurring items development – FY 2014
EBIT excl. non-recurring items development – FY 2014 EUR million 1–12/2014 1–12/2013 Media + Improved profitability in TV, partly Netherlands: supported by lower programming Group 118.8 154.6 costs Media Netherlands 65.0 73.2 - Lower profitability in digital business Media Finland 23.5 30.7 - Invest
Slide 33: Summary of operating performance FY 2014
Summary of operating performance FY 2014* – New media sales: EUR 536 million in Media Finland and Media Netherlands Three Strategic Business Units Media Finland Media Netherlands Learning Other** TV & radio incl. digital Media Belgium Net sales EUR 350 million Four consumer media platforms Media RUS
Slide 34: Media Netherlands
Media Netherlands Key figures* 2014 2013 EUR million FY 2014 Q4 Q3 Q2 Q1 FY 2013 Q4 Q3 Q2 Q1 Net sales 652.7 180.1 146.6 180.0 146.0 685.8 194.1 160.0 179.6 152.2 Digital 300.1 89.0 64.6 82.5 64.0 291.0 88.2 64.8 76.5 61.6 Online & mobile 79.7 24.0 17.1 20.0 18.7 76.9 24.3 17.4 17.7 17.4 TV 220.3 65
Slide 35: Media Finland
Media Finland Key figures* 2014 2013 EUR million FY 2014 Q4 Q3 Q2 Q1 FY 2013 Q4 Q3 Q2 Q1 Net sales 637.2 165.5 148.0 164.6 159.0 675.4 179.0 157.5 170.7 168.2 Digital 198.7 53.2 43.5 53.4 48.6 185.9 54.5 37.5 51.7 42.2 Online & mobile 84.8 23.2 18.3 22.1 21.3 74.7 21.7 15.8 20.5 16.7 TV & radio 113.
Slide 36: Learning
Learning Key figures 2014 2013 EUR million FY 2014 Q4 Q3 Q2 Q1 FY 2013 Q4 Q3 Q2 Q1 Net sales 292.0 30.9 113.0 106.9 41.2 304.6 32.4 123.0 103.5 45.7 Netherlands 98.1 8.3 24.6 40.7 24.5 95.3 7.4 25.0 36.5 26.3 Poland 86.8 12.6 51.1 17.8 5.2 83.8 12.8 46.7 18.1 6.2 Finland 48.3 4.1 10.6 28.8 4.8 53.5
Slide 37: 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. 37 5 February 2015 Fu
Slide 38: 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’. **
Slide 39: 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. 39 5 February 2015 Full-Year Result 2014
Slide 40: 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. 40 5 February 2015 Full-Year Result 2014
Slide 41: Sanoma – Largest shareholders
Sanoma – Largest shareholders % of shares 31 January 2015 and votes 1. Jane and Aatos Erkko Foundation 23.18 23.2% 2. Antti Herlin (Holding Manutas Oy: 9.04%, 10.29 Security Trading 1.23%, personal: 0.02%) 3. Robin Langenskiöld 7.54 4. Rafaela Seppälä 6.31 5. Helsingin Sanomat Foundation 3.50 49.2%
Slide 42: 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
Slide 43: 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 Ms Katariina Hed tel. +358 50 412 5120 katariina.hed@sanoma.com 43 5 February 2015 Full-Year Result 2014
Slide 44: 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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