Sanoma Magazines is one of the five largest magazine publishers in Europe. The Division publishes some 275 titles in 12 countries: Belgium, Bulgaria, Croatia, the Czech Republic, Finland, Hungary, the Netherlands, Romania, Russia, Serbia and Montenegro, Slovakia, and Ukraine. Aldipress is the leading magazine distributor in the Netherlands.
KEY INDICATORS, € million | 31.3.2005 | 31.3.2004 | Change, % | 31.12.2004 |
Net sales | 259.5 | 253.7 | 2.3 | 1 083.7 |
Operating profit | 25.5 | 23.9 | 6.5 | 137.1 |
% of net sales | 9.8 | 9.4 | 12.6 | |
Balance sheet total | 1 622.3 | 1 522.5 | 6.6 | 1 589.8 |
Gross investments | 159.5 | 3.7 | 4 191.8 | 20.0 |
Personnel under employment contract, average | 4 774 | 4 503 | 6.0 | 4 522 |
Personnel, average (full-time equivalents) | 4 247 | 3 959 | 7.3 | 3 992 |
OPERATIONAL INDICATORS, 1.1–31.3. | 2005 | 2004 | ||
Number of copies sold (press distribution / Aldipress), thousands | 27 476 | 28 661 | ||
Number of magazines published | 274 | 231 | ||
Magazine copies sold, thousands | 103 901 | 102 527 | ||
Number of advertising pages sold | 11 296 | 10 189 |
Sanoma Magazines’ net sales in the January–March period increased to EUR 259.5 (253.7) million. Sanoma Uitgevers’ net sales decreased to EUR 117.8 (119.3) million and Sanoma Magazines Finland’s to EUR 41.4 (43.1) million. Net sales at Sanoma Magazines Belgium were stable at EUR 47.3 (47.5) million. Sanoma Magazines International’s net sales increased in almost all operating countries and totalled EUR 39.7 (31.6) million. Independent Media, with operations in Russia and Ukraine, was consolidated with Sanoma Magazines International as of 1 March 2005. Due to new products, net sales at Aldipress grew to EUR 28.0 (26.2.) million. After adjustment for changes in Group structure, the Division’s net sales were at the previous year’s level.
Sanoma Magazines’ advertising sales increased by 7% in the January–March period mainly due to the new operations. Sanoma Uitgevers continued to suffer from the tough competition in the Dutch advertising market and the weak consumption trend. In Sanoma Magazines Belgium, niche publishing and special formulas were especially successful. In Sanoma Magazines Finland, the advertising sales decreased in general magazines. Also, due to the timing differences, the number of issues published in 2005 was lower than in the comparable period. In Sanoma Magazines International, advertising sales increased in all countries except for the Czech Republic where sales were stable despite the continued difficult market situation. Advertising sales accounted for some 20% (19%) of the Division’s total net sales.
The Division’s circulation sales increased by 1% and represented some 60% (61%) of total net sales. Circulation sales at Sanoma Uitgevers and Sanoma Magazines Finland remained stable. Circulation sales in Sanoma Magazines Belgium were at the previous year’s level. Sanoma Magazines International’s circulation sales developed very well. Sales in the Czech Republic remained stable, despite continued strong competition. Circulation sales increased especially in Hungary, Bulgaria, and Croatia.
Despite continuous investments in product portfolio and also in magazines launched in 2004, Sanoma Magazines’ operating profit grew to EUR 25.5 (23.9) million, mainly due to lower operational costs and timing of expenses. Sanoma Uitgevers’ profitability remained good and its result was at the previous year’s level. Sanoma Magazines Belgium and Sanoma Magazines International improved their results whereas Sanoma Magazines Finland posted a slightly lower result due to decreased sales. Result at Aldipress improved slightly.
In 2005, Sanoma Magazines’ net sales are estimated to grow. Operating profit including Independent Media is expected to remain to some extent below that of 2004 due to continuing investments in future growth and expansion into new markets. In addition, it is uncertain what is happening in the Dutch magazine advertising market.