Slide 1: Alma Media Q4 and FY 2015
ALMA MEDIA Q4 AND FY 2015 Kai Telanne, President and CEO Juha Nuutinen, CFO 12.2.2016 @AlmaMedia_IR 12.2.2016
Slide 2: Agenda
Agenda Highlights Market development Financial development Strategy and outlook Q &A
Slide 3: Alma Media's year 2015 in brief
Alma Media’s year 2015 in brief Operating profit excluding non-recurring items improved Business development: – in spite of the difficult economic climate: • Revenue decreased to MEUR 291.5 in 2015 • In Digital Consumer Services, revenue growth with an due to divestments. excellent level of profitab
Slide 4: Market development in Finland
MARKET DEVELOPMENT IN FINLAND @AlmaMedia_IR 12.2.2016
Slide 5: Advertising sales change 12/2014 - 12/2015
Advertising sales change 12/2014 - 12/2015 20% 15% 10% 5% 0% -5% -10% -15% Advertising sales total, chg % Newspaper advertising, chg % Online advertising, chg % Source: TNS Media Intelligence 12.2.2016 @AlmaMedia_IR 5
Slide 6: Advertising increased in December, with growth in vehicle, food and entertainment advertising
Advertising increased in December, with growth in vehicle, food and entertainment advertising Total market, change from previous year P10 2015 vs 2014 P11 2015 vs 2014 P12 2015 vs 2014 Retail -0.4 % Retail -7.0 % Retail -2.4 % Motor v. 4.1 % Motor v. -3.8 % Motor v. 14.4 % Food & bev. -3.9 % Food &
Slide 7: Digital advertising has established its position as the second-largest area of media advertising
Digital advertising has established its position as the second- largest area of media advertising, behind newspapers Online advertising investments 2015 Breakdown of display advertising in 2015 Search engine advertising and online directories Facebook 98,6 M€ Display 20.7% (34.5%) advertising 153,6
Slide 8: Investments by online media type in 2015
Investments by online media type in 2015 Online services of Magazines; 3% financial media; 3% Other online services; Search engine 7% advertising ; 34% Online services of TV and radio broadcasters; 9% Social media; 12% Classifieds; 14% Online services of newspapers; 18% Sources: TNS Ad Intelligence
Slide 9: Alma Media's profit performance
ALMA MEDIA’S PROFIT PERFORMANCE @AlmaMedia_IR 12.2.2016 9
Slide 10: Revenue decreased due to divestments
Revenue decreased 1.9 4.2 -0.1 -4.4 due to divestments • Revenue in 2015 decreased by 1.3%, primarily due 78.6 76.6 to divestments. • Talentum’s effect on revenue was MEUR +5.8. • JM Tieto’s effect on revenue was Q4 2014 Digital Consumer Financial Media and National Consumer Regional Media Q4 2015 S
Slide 11: Operating profit excluding non-recurring items improved
Operating profit excluding non-recurring items improved 0.2 1.2 -0.4 0.9 -0.4 • Operating profit excluding non-recurring items for the full year 2015 was MEUR 23.4, or 8.0% (7.2%) of revenue. 7.1 • Total expenses decreased by MEUR 0.5, 5.6 or 0.2%, to MEUR 277.4 (277.9). • Depreciation and impairmen
Slide 12: MEUR 100 milestone exceeded in revenue from digital products and services
MEUR 100 milestone exceeded in revenue from digital products and services – growth accelerated in Q4 Q4 digital business revenue grew by 17.7%. The growth rate in 2015 was 8.7%. MEUR Segment’s share of the Group’s 35.3 % digital revenue 32.0 % 28.1 % 4.5 % 24.3 % 12.0 % 18.0 % 15.7 % 12.9 % 13.1 % 1
Slide 13: Alma's digital product portfolio has grown substantially since the late 1990s
Alma’s digital product portfolio has grown substantially since the late 1990s • Media business brands operated with a multi-channel approach. • Digital consumer and business services have been developed in-house and obtained by acquisitions. • Divestments have also been made. 1995 2000 2005 2010 201
Slide 14: Alma's operations in Finland and internationally
Alma’s operations in Finland and internationally Revenue 2012–2015 Domestic Foreign operations Not Allocated • Alma’s international business is growing and 32 37 37 profitable. 45 • The most significant investments in the international recruitment business were made in 2012: 286 260 252 235 LMC, Pro
Slide 15: Financial review
FINANCIAL REVIEW Juha Nuutinen, CFO @AlmaMedia_IR
Slide 16: Long-term financial targets
Long-term financial targets Alma Media’s financial 2011 2012 2013 2014 2015 Target targets Digital business growth 16.3% 36.8% 8.4% 11.9% 8.7% > 15% Return on Investment 26.1% 13.8% 10.0% 9.8% 6.9 % > 15% (ROI), % Dividend payout ratio* 103% 45% 50% 63% 92% > 50% * Includes capital repayment to shar
Slide 17: Revenue breakdown
Revenue breakdown 2.6 % October–December • Content revenue +5.5%. • Talentum’s effect on content revenue 5.2 % MEUR +4.1. 5.5 % 76.6 78.6 • Advertising revenue +5.2% 38.6 40.6 -14.9 % 27.7 29.2 • Advertising sales for print media -2.2% 10.2 8.7 • Online advertising sales +20.7% Content sales Adverti
Slide 18: Operating profit breakdown
Operating profit breakdown 26.3 % -9.4% 46.0% 7.1 11.5% 968.9% 5.6 2.8 3.8 3.4 -21.4% 1.9 1.8 2.1 0.1 1.3 -2.0 -2.5 Digital Consumer Financial Media National Regional Media Group operations Alma Media total Services and Business Consumer Media Services Q4 2014 Q4 2015 9.3 % 46.6% 19.1% -7.0% 23.4 21
Slide 19: Digital Consumer Services in 2015: strong international growth
Digital Consumer Services in 2015: strong international growth • Revenue from the recruitment business increased by 20.5% and it accounted for 73.6% (67.5%) of the segment’s revenue in 2015. • In Finland, Alma Media’s digital services maintained their profit level. • The business was highly profitab
Slide 20: Financial Media and Business Services in 2015
Financial Media and Business Services in 2015: significant acquisitions and divestments • Online business accounted for 41.7% (43.0%) of the segment’s revenue. • For the first time, the number of subscribers of Kauppalehti’s digital products exceeded print (53%). • Profitability excluding non-recurr
Slide 21: National Consumer Media in 2015
National Consumer Media in 2015: encouraging growth in mobile advertising late in the year • Online business accounted for 29.8% (27.0%) of the segment’s revenue. • Content revenue -13.2% to MEUR 24.7 due to the decrease in Iltalehti’s circulation • Advertising sales -8.6% to MEUR 16.8: print media
Slide 22: Regional Media in 2015: continued structural reforms
Regional Media in 2015: continued structural reforms • Online business represented 3.5% (2.6%) of revenue. • Content revenue -8.7% to MEUR 59.8. Advertising sales -9.9% to MEUR 56.3: print media advertising sales -11.1%, while online advertising sales +23.2%. • Operating profit excluding non-recurri
Slide 23: Cash flow from operating activities and investments
Cash flow from operating activities and investments 16,7 5.7 3.4 -0.9 MEUR 8.2 MEUR 8.7 6.2 8.7 -21.9 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q4 14 Q4 15 Cash flow from operating activities Gross investments Proceeds from sales of assets 12.2.2016 @AlmaMedia_IR 23
Slide 24: Interest-bearing liabilities
Interest-bearing liabilities Net debt Q2/2013-Q4/2015 Net debt distribution Q4/2015 Financial leasing 65.0 97.6 Financial loans 25.6 76.2 MEUR 71.1 67.8 63.4 Commercial papers 0.0 62.1 Cash and cash -14.4 equivalents Total 76.2 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 12.2.2
Slide 25: Equity ratio and Gearing
Equity ratio and Gearing IFRS Equity ratio, % Gearing, % 42.6 42.5 68.5 59.2 2014 2015 2014 2015 12.2.2016 @AlmaMedia_IR 25
Slide 26: Earnings per share and equity per share
Earnings per share and equity per share 0.19 0.13 1.35 1.17 0.71 0.20 0.20 0.47 -0.01 0.70 0.64 -0.07 2014 2015 2014 2015 EPS wo non-recurring items Retained earnings Non-recurring items Restricted equity 12.2.2016 @AlmaMedia_IR 26
Slide 27: Balance sheet
Balance sheet Assets Liabilities 328 328 54 256 256 129 41 104 109 274 69 215 83 91 Q4 2014 Q4 2015 Q4 2014 Q4 2015 Shareholders' equity Long-term assets Non-Ib debt Short-term assets Ib debt 12.2.2016 @AlmaMedia_IR 27
Slide 28: Depreciation of intangible assets – timetable
Depreciation of intangible assets – timetable MEUR 6.5 4.3 4.1 3.7 3.8 3.0 3.1 2012 2013 2014 2015 2016S 2017S 2018S Depreciations on business combinations 12.2.2016 @AlmaMedia_IR 28
Slide 29: Talentum
Talentum Financial Review 2015
Slide 30: Talentum 2015 in brief
Talentum 2015 in brief Achievements Challenges • Positive trend in Talentum Group’s operating • Operating income without non-recurring income without non-recurring items items in Magazines Sweden and in Events continued decreased • Operating profit without non-recurring items • As a result of Talent
Slide 31: Talentum Financial Review
Talentum Financial Review Sales progression R12M EBIT margin progression R12M without non-recurring items 74,0 73,1 6,0 5,6 72,5 72,4 72,6 5,4 72,3 72,0 4,9 5,0 4,4 4,1 70,0 4,0 68,0 3,0 66,0 2,0 64,0 1,0 62,0 60,0 0,0 Q4/2014 Q1/2015 Q2/2015 Q3/2015 Q4/2015 Q4/2014 Q1/2015 Q2/2015 Q3/2015 Q4/2015
Slide 32: EBIT development 2015
EBIT development 2015 Excluding one-off items Magazines Magazines Finland Sweden Events Pro Direct Marketing Other Total 6,0 5,4 5,0 4,1 4,0 3,3 3,0 2,5 M€ 2,0 1,7 1,5 1,3 1,0 1,0 0,2 0,2 0,1 0,0 -0,2 -1,0 2014 2015 -1,1 -1,1 -2,0
Slide 33: Strategy and outlook
STRATEGY AND OUTLOOK Kai Telanne @AlmaMedia_IR
Slide 34: Strategic development areas
Strategic development areas Multi-channel Marketing Resources and Digital services content solutions expertise We will build new capacities, seek efficiency and accelerate growth in digital services and media. 12.2.2016 @AlmaMedia_IR 34
Slide 35: Kauppalehti and Talentum together are now Alma Talent
Kauppalehti and Talentum together are now Alma Talent.
Slide 36: The integration of Talentum and Alma Media
The integration of Talentum and Alma Media – the combination is being implemented at two levels Group functions Group functions Financial Media and Business Services Magazine Business Finland Magazine Business Sweden Digital Consumer Services production and distribution of financial publishes magazi
Slide 37: Combination process
Combination process • The annual cost synergies expected from the combination may amount to EUR 4–5 million, and the integration costs resulting from the combination will be approximately EUR 1–2 million in the first year of operation following the combination. • The new business unit’s management t
Slide 38: Estimated timetable of Talentum's delisting
Estimated timetable of Talentum’s delisting Execution of the exchange offer and Q2/2016 redemption of minority shares Confirmation of redemption right Confirmation and payment of collateral 17 November Talentum’s Q1/2016 amount Decision regarding Extraordinary Arbitrators Talentum delisting the exec
Slide 39: Sustainable growth while making use of digitisation opportunities
Sustainable growth while making use of digitisation opportunities: growing the service business • Alma has expanded beyond the sphere of traditional media to various system and expert services, such as: • in the real estate business, a housing marketplace system and information services. • in the re
Slide 40: Outlook
Outlook • The Finnish economy is expected to show zero growth or only slight growth in 2016. Alma Media’s significant operating countries in Eastern Central Europe, such as the Czech Republic and Slovakia, are expected to see continued economic growth, but at a lower rate than in 2015. • Macroeconom
Slide 41: Thank you!
THANK YOU! Upcoming events in the investor calendar: • Report by the Board of Directors and Financial Statements: 25 February 2016 • Annual General Meeting: 17 March 2016 • Q1 result: 29 April 2016 • CMD: 17 May 2016 /Helsinki 12.2.2016 @AlmaMedia_IR 41