At the Board meeting today, the Board of Directors of Schibsted ASA approved the interim financial statement as of March 31, 2002. Please find enclosed the key figures.
Financial situation
Schibsted’s operating revenues for the 1st quarter of 2002 amounted to NOK 1,989 million, a reduction of NOK 44 million, or 2%, compared to the same period in 2001. This reduction is primarily due to a weaker SEK and a drop in advertising revenues. Despite reduced operating revenues, the Group’s operating profit for the 1st quarter of 2002 saw an improvement. The Group’s operating profit before goodwill and other revenues and expenses increased from NOK 90 million in 2001 to NOK 129 million in 2002. This increase is largely attributable to the lower level of expenses which has been established at Aftenposten and Svenska Dagbladet, as well as reduced multimedia activities.
Net financial items for the quarter show a loss of NOK 11 million, compared to a profit of NOK 4 million in 2001 as a result of share profits last year, as well as reduced foreign exchange gains.
Income from associated companies for the 1st quarter of 2002 amounted to NOK -42 million, which is an improvement of NOK 36 million compared to the 1st quarter of 2001. This improvement was primarily attributable to the fact that Scandinavia Online AB is no longer a burden on the Group’s profits following the sale of shares in the 4th quarter of 2001.
Profit before taxes amounted to NOK 60 million and net income for the period amounted to NOK 22 million, compared to NOK 2 million and NOK -36 million respectively for the corresponding period in 2001. Taxes for the 1st quarter amounted to NOK 38 million in both 2002 and 2001. Tax expense for the Group may vary considerably from the nominal tax rate in Norway (28%) as a result of differences between the Group’s profit (loss) before taxes and the tax base. These differences are primarily related to amortisation of goodwill, income from associated companies and losses in foreign subsidiaries for which no tax assets are recognised. These differences were reduced in the 1st quarter of 2002 compared to the corresponding period in 2001 due to the reduced negative profits contributed by associated companies and reduced losses in foreign subsidiaries. Earnings per share amounted to NOK 0.27 compared to NOK -0.50 for the corresponding period in 2001.
Cash flow from operating activities for the 1st quarter of 2002 amounted to NOK -19 million, compared to NOK -130 million for the same period in 2001. This improvement was attributable to a smaller increase in working capital than in the same period last year. During the 1st quarter of 2002 the Group invested NOK 126 million in intangible and tangible fixed assets, of which NOK 49 million was financed by a financial lease. The Group has invested NOK 108 million in shares, of which NOK 101 million is an injection of equity capital in 20 Minutes France SAS. Net interest-bearing debt increased by NOK 228 million during the 1st quarter of 2002 to NOK 1,624 million. Total liquidity reserves amount to approx. NOK 1.7 billion as of 31.3.02. The Group’s equity ratio was 33% at the end of the 1st quarter of 2002, compared to 32% at the beginning of the year.
Following the reorganisation of the nature of its business so that it mainly comprises investments involving the use of available advertising capacity, European Media Venture (EMV) is reported as being part of the Group’s Newspaper operations with effect from the 1st quarter of 2002. The company’s activities were reduced substantially in 2002. Because the nature of the business has been changed, the comparable figures for previous years, where EMV was reported under Multimedia, have not been restated. EMV’s operating revenues for 2001 amounted to NOK 5 million, and its operating loss amounted to NOK 15 million.
With effect from 2002 the former Multimedia business area (Schibsted Telecom, Bokkilden, etc.) is being reported as part of Other activities. This is due to a change in the Group’s organisation and internal management reporting as well as reduced levels of activity in respect of this type of business. The comparable figures for previous financial years have been restated.
Future prospects
VG is expected to retain its clear leading position on the Norwegian single copy market in 2002. Aftonbladet has noticed that the circulation figures for Expressen/GT/Kvällsposten are increasing slightly, but nevertheless expects to retain its clear leading position on the Swedish single copy market in 2002. Circulation developments in respect of Svenska Dagbladet continue to be good, and the Group is optimistic about the paper’s forthcoming developments. Aftenposten has also noticed some positive signs in respect of its circulation development. Even though overall circulation developments are good, the Group is cautiously optimistic about the newspapers’ future profits due to the continued weak advertising markets.
Many players in the TV/film industry are struggling. However, Schibsted’s TV/Film companies have increased their market positions and they still have faith in future developments being favourable.
The implementation of further measures to improve profitability will be assessed on an ongoing basis, and the Group will continue to focus on its core activities, the Productivity and Profitability Program, and cash flow situation.
Presentation 1st Quarter 2002:
http://reports.huginonline.com/859175/103618.pdf
1st Quarter 2002:
http://reports.huginonline.com/859176/103619.pdf
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