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Enskilda Securities Nordic Seminar 2005 20. januar 2005 Kjell Aamot CEO Stein Yndestad IR.

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Presentation on theme: "Enskilda Securities Nordic Seminar 2005 20. januar 2005 Kjell Aamot CEO Stein Yndestad IR."— Presentation transcript:

1 Enskilda Securities Nordic Seminar januar 2005 Kjell Aamot CEO Stein Yndestad IR

2 Enskilda Securities Nordic Seminar Q3 Highlights Schibsted’s best Q3 ever Strong development for online activities continues Record-high results in Aftonbladet Good development in 20 Minutes continues Growth in the recruitment market – Aftenposten proceeds to deliver improved results Solid results for VG even with a somewhat weaker circulation Weak quarter for TV-production, while Sandrew Metronome and Publishing have improved Q3 results from last year

3 Enskilda Securities Nordic Seminar History 1836 Established Restructuring Listed on Oslo Stock Exchange Growth & expansion Focus & consolidation Consolidation New growth?

4 Enskilda Securities Nordic Seminar Strategy Previous announced strategy to be continued – financials and market position enables increased focus on growth Growth through both acquisitions and organic growth The Group’s strong position and competitive advantages as a basis Acquisitions complementing and strengthening already existing positions New media and free newspaper engagements Financial targets unchanged

5 Enskilda Securities Nordic Seminar Financial targets – over a business cycle EBITA-margin12% EBITDA-margin16% Return on equity22% Return on assets15% Long term target for organic profitable growth7% Equity ratio35% (min. 25%) Net interest bearing debt/EBITDA3 Minimum net cashflow from operations after maintenance capex (before dividend) NOK 400 million

6 Enskilda Securities Nordic Seminar Strong Brands Content Know-how Marketing Capacity Strong Cash Flow Execution Skills New Business Opportunities Newspapers TV-production Publishing Film Rights Internet (www) Mobile Internet Broadband Build on core activities for continuous development Off-line Positions Online Platforms Stand by strategic position as of 1995

7 Enskilda Securities Nordic Seminar Circulation decline puts pressure on the newspapers and emphasizes the need to create new platforms for growth Development of number of sold copies per capita ( ) Island Belgium Portugal AustriaGreeceDenmarkGermanyNorway Luxemburg UK Switzerland France Italy Netherlands Sweden 2,2% 29,2% USA Spain Finland Ireland Source: World Association of Newspapers, Global insight

8 Enskilda Securities Nordic Seminar Charles Darwin ”It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.”

9 Enskilda Securities Nordic Seminar Strategic repositioning 2004 Product scope Geographic focus area Newspapers Elektronic media NorwayScandinavia Europe 1995

10 Enskilda Securities Nordic Seminar The great conserns in 2001 Online

11 Enskilda Securities Nordic Seminar Value trigers at the end of 2004 m.fl.

12 Enskilda Securities Nordic Seminar

13 Enskilda Securities Nordic Seminar A 20 Minutes edition goes through three phases Time Distribution audience Revenues Phase 1: Optimize circulation Phase 3 Revenue growth Phase 2 Readership growth

14 Enskilda Securities Nordic Seminar Zurich Bern Basle Madrid Barcelone ParisSevillaZaragoza Lille Lyon Marseille Valence Alicante Luzern Toulouse Bordeaux Circulation development Malaga 2005

15 Enskilda Securities Nordic Seminar The development of 10 – 13 year olds, who read a newspaper more than once per week (Switzerland) 10 – 13 years German- speaking Switzerland 20 Minuten und die Kids % 50% 25% 75% 85% Before 20minutes After 20minutes Source:Special survey – “Kids & News“

16 Enskilda Securities Nordic Seminar And the concept is proving itself by attracting advertisers targeting the young, problematic readers! CocaCola on a front page ad!

17 Enskilda Securities Nordic Seminar Online

18 Enskilda Securities Nordic Seminar Operating revenues – rolling 12 months 2% Online activities %= %= % For the year of 2001 the online activities had an operating loss incl. restructuring costs of NOK -171 million Share of online activities increases NOK million Operating profit (EBITA) Q %= %= % 27% Q Q Q %= %= 165 2% 18% Online activities Accumulated EBITA as of Q of NOK 119 million

19 Enskilda Securities Nordic Seminar Financials 2000 – %-10% 36% NOK million 24% 33% * *As of 30 September 2004

20 Enskilda Securities Nordic Seminar Successful launch of the new format The positive development within recruitment ads continues Operating profit (EBITA) in the newspaper improved by NOK 25 million from Q3 last year (adjusted for royalty) Revenue development in ad markets in Q3 compared to the corresponding period last year: Recruitment: % Real estate: % High turnover of properties as well as more objects sold directly from the Internet Brand/display: - 2% Supplements: + 50%

21 Enskilda Securities Nordic Seminar Pricing in the new Aftenposten New pricing model will be introduced based on response and effect The response of a tabloid full page is close to the response of a full page in broadsheet. Therefore priced to 75-85% of full page in broadsheet Response increases non-proportional with the size of the ad – reflected in prices Introducing a new measurement method for ad effects Brand/display ads Classified ads Evening issue No short term impact Positive long term impacts due to new readers Competitive advantage, especially towards TV Prises mainly unchanged, discount on larger ads, like for brand/display ads. Differenciated pricing of recruitement ads Same model as the morning edition Focus moved from modular to fraction of page Developed in close cooperation with advertisers

22 Enskilda Securities Nordic Seminar Migration of classified advertising – Real estate Number of ads, 12-month rolling average

23 Enskilda Securities Nordic Seminar Migration of classified advertising – Recruitment Number of ads, 12-month rolling average

24 Enskilda Securities Nordic Seminar The steady cash cows

25 Enskilda Securities Nordic Seminar Q3Q1Q2Q3Q1Q2Q3Q1Q2Q3Q1Q2Q Only online version Both Only paper version Readership on- and offline Q se Daily readership, thousands

26 Enskilda Securities Nordic Seminar Readership on- and offline 96/9797/9898/9999/0000/01 1,391 1,481 1,522 1,403 1,655 Source:Gallup – 96/97 represents Forbruker & Media 02/97 01/0202/03 1,571 1,392 Only online version Both Only paper version Daily readership, thousands

27 Enskilda Securities Nordic Seminar Alma Media

28 Enskilda Securities Nordic Seminar ILTALEHTIMTV3KAUPPALEHTI AAMULEHTI SATAKUNNAN KANSA LAPIN KANSA POHJOLAN SANOMAT KAINUUN SANOMAT SUOMEN PAIKALLISSANOMAT SUBTV RADIO NOVA (74%) MTV Interactive BALANCE CONSULTING BALTIC NEWS SERVICE CLASSIFIED SERVICES TV4 (23,4%) BROAD- CASTING ALPRESSBIG MEDIA SERVICES GROUP ADMINISTRATION TALENTUM (31,7%) Alma Media Corporation Alma Media Group ALMA MEDIA INFORMATION SYS. NEW VENTURES ACTA PRINT (36%) LEHDENTEKIJÄT STARFUNDS FINLAND (51%)

29 Enskilda Securities Nordic Seminar Strategic fit Strategic principles for growth The two companies have similar business, with Alma being stronger in TV, and complementary geographic presence Within the core operations Mainly within areas that will reduce the dependency on business cycles Strategic control possible over time Synergies with existing operations Complementary geographic exposure to Schibsted Advanced in new media – MTV3.fi is the largest media site in Finland Limited exposure to offline classifieds, but a strong online presence within real estate and cars Stronger than Schibsted in TV

30 Enskilda Securities Nordic Seminar Schibsteds run for Alma Media During the summer Schibsted conducted negotiations with the larges institutional owners in Finland to buy 34% of the votes. Not able to agree on the conditions The negotiations probably reached Bonnier A second attempt to buy the institutions holdings during the fall/winter did not result in a deal Schibsted decidet it was no longer fruitfull to wait, a bid for Alma Media was launched on the 21th of December The offer was 11,40 for series 1 and 10,70 for series 2, a premium of 55% and 35% on the 12-month volume-weighted average trading price

31 Enskilda Securities Nordic Seminar Broadcasting is the gemstone of Alma Media Schibsted key interest is the broadcasting division The board initiated a process to restructure the Broadcasting division in November. Some likely buyers were contacted. Schibsted was for some reason not contacted. Potential buyers signed the NDA almost immediately after Schibsteds offer was announced. Our Tender Offer puts us in a difficult position.

32 Enskilda Securities Nordic Seminar Share price of Alma Media, Series 1

33 Enskilda Securities Nordic Seminar What happens now ? Schibsted may withdraw the offer The MAC will probably be invoced Schibsted completes the tender offer: If acceptance is more than 33,3%, Schibsteed becomes a major owner of Alma If accemptance is bellow 33,3%, Schibsted may choose to accept the shares offered. Schibsted is comfortable with the holdings in TV4. Could be of strategic value depending on the outcome of the Broadcasting sale in Alma Media. Schibsted may choose to place a bid for Almas TV4 shares separately

34 Enskilda Securities Nordic Seminar Outlook Positive expectations to Aftenposten in relation to the change to tabloid format The tabloids are expected to continue to deliver strong results Further challenges for Svenska Dagbladet A good Q4 in 20 Minutes expected, increased competition Positive development for the online activities – expected to represent approx. 20% of the Group’s operating profit (EBITA) Improved outlook for TV/Film Parliament’s report regarding new media legislation represents small improvements for Schibsted

35 Enskilda Securities Nordic Seminar Appendices

36 Enskilda Securities Nordic Seminar Ownership structure in Nordic TV TV 2 Schibsted A-Pressen Egmont Norway TV Norge SBS TV 3 MTG TV 4 Sweden Kanal5 SBS TV 3 MTG TV 2 The Government Denmark TVDanmark 1&2 SBS TV 3 MTG Proventus MTV 3 Alma Media Finland Nelonen 4 Sanoma MTG Other SBS Schibsted Other Alma Media Bonnier

37 Enskilda Securities Nordic Seminar Operating profit (loss) (EBITA) Newspapers Q3 1) Figures in NOK million 2) Figures in SEK million As of Sept (28)(10) Aftenposten 1) VG 1) (13) Svenska Dagbladet 2) (25) Aftonbladet 2)

38 Enskilda Securities Nordic Seminar Number of unique users improved by 53% in September Record of more than 100,000 active ads simultaneously and 1,365,000 unique users in September Operating profit (EBITA) in Q3 of NOK 17 million (NOK 15 million) Turnover improved by 29% to NOK 44 million in Q3: Recruitment: + 33% Real estate: + 18% Cars: + 50% Continued strong growth and increased traffic within all segments

39 Enskilda Securities Nordic Seminar Solid results and the success on the net continues Schibsted’s most profitable company (nominal terms) Operating revenues and EBITA-margin in Q3 at same levels as last year Circulation on weekdays reduced by 3.7% as of September compared to same time last year Maintains its strong market share Operating margin (EBITA) of 25% (2%) for the online newspaper in Q3

40 Enskilda Securities Nordic Seminar Low ad revenues continues to weaken the result Ad revenues in Q3 reduced from the corresponding period last year to SEK 65 million (SEK 85 million) Positive development in circulation revenues - amounts to SEK 96 million (SEK 92 million) The tough competition in Stockholm continues No negative effects so far for SvD from the change of Dagens Nyheter to tabloid format SvD.se with a postitive development – record high number of uniqe visitors in September of 643,000 ”New SvD”– a further upgrade of the editorial product will be launched on November 8 th

41 Enskilda Securities Nordic Seminar Record-high results in Aftonbladet Operating revenues increased by 15% compared to Q Operating margin (EBITA) of 16% (12%) in Q3 Circulation on weekdays increased by 3,300 copies from last year The gap towards Expressen was 94,400 by the end of September Continues to take market shares in the advertising market Ad revenues increased by 83% to SEK 153 million in Q3 incl. online activities

42 Enskilda Securities Nordic Seminar Aftonbladet strengthenes its online position Online activities comprises now of Aftonbladet Nya Medier, Blocket.se and BytBil (as of July 1 st 2004) Represents 33% (15%) of Aftonbladet’s total ad revenues in Q3 Increased gap compared to the amount of visitors of the main competitors Development of new products continues, e.g. paid services like “the Weight Club” and “Plus”

43 Enskilda Securities Nordic Seminar Operating profit (EBITA) TV/Film & Publishing Q3 1) Figures in NOK million 2) Figures in SEK million As of Sept (4)(10) Metronome 2) (16)8 Sandrew Metronome 2) *) (8) Publishing 1) TV 2 Group 1) **) (EBIT) *) Figures for 100% of Sandrew Metronome Group. Schibsted owns 50% of the company **) Schibsted owns 33.3% of the company

44 Enskilda Securities Nordic Seminar Operating revenues in line with last year, but weaker results Disappointing results from the major focus on interactive TV in Norway, Sweden and Estonia – the expected positive development in Q3 did not occur Turn around in the Norwegian production company Rubicon after decreasing order quantity and negative development. New management in place in Q3, but 2004 is not expected to be a good year The Swedish TV production operations of Metronome maintains a solid market position, but margins squeezed due to severe competition

45 Enskilda Securities Nordic Seminar Substantial improvement in results compared to last year Improved results in both the cinema and distribution operations compared to last year Positive development within domestic films, especially in Norway and Sweden Competition authorities finishes review of the sale of cinemas in Sweden in December/January Blockbusters ”Harry Potter III” and ”Troia” on DVD/video in Q4 New distribution agreement with Warner as of June 2005 – reorganization of the video/DVD distribution of Sandrew Metronome Distribution of Warner’s and SM’s films operated by Warner Warner responsible for sales and logistics No influence on SM’s distribution of Warner’s cinema films in the Nordic countries

46 Enskilda Securities Nordic Seminar Improved operating profit and generally stable operations Coordination of operations and resources in the merged Norwegian publishing houses proceeds according to plan Profit improvement in Q3 despite logistical problems throughout main parts of the year due to sale of international books Improved sale of Norwegian books in an overall decreasing market for books so far this year Stable circulation figures of the magazines Dine Penger, Maison and 4U – and Pondus close to a monthly sale of 70,000 copies Q4 is the most important quarter in terms of book sales – expectations associated with the new books Pondus and Petter Solberg

47 Enskilda Securities Nordic Seminar TV Group Olympics and Kanal 24 with negative influence on Q3 results Increased costs due to broadcasting of summer olympics Operating profit for the TV channel in Q3 of NOK 6 million (NOK 22 million) The subsidiaries TV 2 Nettavisen og TV 2 Interaktiv delivers improved operating profits of NOK 0 million (NOK -4 million) and NOK 1 million (NOK -3 million) in Q3 Sale of share in TVNorge gives a profit of NOK 82.7 million Further write down of TV 2’s investment in Kanal 24 is by NOK 60 million in Q3 – total exposure for TV 2 is presently close to NOK 55 million

48 Enskilda Securities Nordic Seminar Income statement Schibsted Group

49 Enskilda Securities Nordic Seminar Advertising – Paper Editions 1) Column meters 2) SEK million

50 Enskilda Securities Nordic Seminar Development in real estate and recruitment markets (rolling 12 months)

51 Enskilda Securities Nordic Seminar Quarterly revenues from classified advertising NOK million

52 Enskilda Securities Nordic Seminar Operating profit (loss) – Online activities Includes FINN, Bytbil, Mediearkivene and Retriever. Finnmer/Blocket is included from Q The results are included in the Newspaper division.

53 Enskilda Securities Nordic Seminar Multimedia – Operating profit (loss) (EBITA)

54 Enskilda Securities Nordic Seminar Associated companies Schibsted’s share 1)To included 2)Schibsted’s share of the result in TV 2 and the regional newspapers is adjusted for the write-down of Kanal 24.

55 Enskilda Securities Nordic Seminar Operating profit (loss) – proforma 20 Minutes is consolidated as a subsidiary from 1 March Figures include 20 Minutes Group (Switzerland and Spain) as well as 50% of 20 Minutes France.

56 Enskilda Securities Nordic Seminar Positive operating profit (EBITA) despite a seasonally weak quarter EUR 0.4 million in Q3 Close down of operations in Spain and France during the vacation period Largest newspaper in Switzerland with 782,000 daily readers (Blick 736,000 readers) 46.5% of readers in the age of 14 to 34 years Expect stronger competition from established players in Spain Not yet included in official readership surveys in France - influences revenues negatively - may delay break-even Launches in Bordeaux and Toulouse in September with circulation of approx. 30,000 copies in each city Growth in all markets

57 Enskilda Securities Nordic Seminar Operating revenues and profit development 2002 Q1 Q2 Q3Q Q1 Q2 Q3Q Q1 Q2 Q3

58 Enskilda Securities Nordic Seminar Key financial figures 1)Net interest bearing debt 2)Holdings of own shares are offset against equity 3)LTM

59 Enskilda Securities Nordic Seminar Financial items

60 Enskilda Securities Nordic Seminar Cash Flow / Investments

61 Enskilda Securities Nordic Seminar Balance sheet

62 Enskilda Securities Nordic Seminar IFRS Standards and interpretations of these might be changed Expect to choose solutions creating minimum differences where options exist (accounting principles and transitional provisions) Business combinations / Goodwill No amortisation of goodwill Goodwill may have to be reclassified to and be amortised as Other intangible assets Limited requirements to reclassify goodwill acquired prior to Amortisation in 2004 related to goodwill acquired prior to Jan 01, 2004 of approx. NOK 60 million

63 Enskilda Securities Nordic Seminar IFRS – cont’d Pensions Limited effect on profits and equity expected for Norwegian plans, cf. immaterial actuarial gains / losses as of Dec 31, 2003 Uncertainty regarding accounting practice for Swedish plans Share based payment Expensing of fair value of options with expected impact on profits of NOK 1-3 million (2004) Dividends Timing of recognition as liability / increased equity at year end

64 Enskilda Securities Nordic Seminar Circulation development – YTD a)Figures in NOK million b)Figures in SEK million

65 Enskilda Securities Nordic Seminar Operating profit (loss)

66 Enskilda Securities Nordic Seminar Actual results vs. analysts’ expectations

67 Enskilda Securities Nordic Seminar Cash flow

68 Enskilda Securities Nordic Seminar Newspapers – Operating profit (loss)

69 Enskilda Securities Nordic Seminar Operating profit (loss) The operating profit (loss) is for the Aftenposten Group.

70 Enskilda Securities Nordic Seminar Operating profit – the newspaper Figures for Aftenposten AS (the newspaper)

71 Enskilda Securities Nordic Seminar Advertising revenue split The figures are for the newspaper Aftenposten AS.

72 Enskilda Securities Nordic Seminar Pricing in the new Aftenposten New pricing model will be introduced based on response and effect The response of a tabloid full page is close to the response of a full page in broadsheet. Therefore priced to 75-85% of full page in broadsheet Response increases non-proportional with the size of the ad – reflected in prices Introducing a new measurement method for ad effects Brand/display ads Classified ads Evening issue No short term impact Positive long term impacts due to new readers Competitive advantage, especially towards TV Prises mainly unchanged, discount on larger ads, like for brand/display ads. Differenciated pricing of recruitement ads Same model as the morning edition Focus moved from modular to fraction of page Developed in close cooperation with advertisers

73 Enskilda Securities Nordic Seminar Operating profit

74 Enskilda Securities Nordic Seminar Operating profit The operating profit includes VG AS, VG Multimedia AS and Avisretur AS

75 Enskilda Securities Nordic Seminar Operating profit The operating profit is for the Aftonbladet Group

76 Enskilda Securities Nordic Seminar Circulation 2000 – 2004 Circulation Per publishing day Gap

77 Enskilda Securities Nordic Seminar Operating profit The operating profit (loss) is for the Svenska Dagbladet Group

78 Enskilda Securities Nordic Seminar Operating profit

79 Enskilda Securities Nordic Seminar Advertising development regional newspapers Figures represent volume measured in column meters, excl. supplements

80 Enskilda Securities Nordic Seminar Operating profit (EBITA) in Q3 of NOK 2 million (3 million) Turnover growth of 15% in Q3 Generally weak ad market in Q3 Printing plant problems due to new equipment not yet solved Kanal 2 has success with the relaunched news as of August – market leader in Prime Time Stable good operation for the magazines in Lithuania Relaunch of magazine in August reduces the result ŽLG The Baltics

81 Enskilda Securities Nordic Seminar Operating profit – Baltics GW: Goodwill ŽLG

82 Enskilda Securities Nordic Seminar Operating profit – Baltics GW: GoodwillExchange rate NOK / EEK

83 Enskilda Securities Nordic Seminar Operating profit (loss) – TV/Film GW: Goodwill

84 Enskilda Securities Nordic Seminar Operating profit Accounts for Metronome Group. 100% is included in the consolidated accounts. Schibsted owns 65% GW: Goodwill

85 Enskilda Securities Nordic Seminar Operating profit Accounts for the Sandrew Metronome Group. Schibsted owns 50% of the Group. 50% is included in the consolidated accounts for Schibsted.

86 Enskilda Securities Nordic Seminar Accounts for the TV 2 Group. Schibsted owns 33.3% of the company Operating profit (loss) TV Group

87 Enskilda Securities Nordic Seminar Operating profit – Publishing GW: Goodwill

88 Enskilda Securities Nordic Seminar Our markets Norway VG – no. 1 newspaper Aftenposten – leading morning newspaper Finn.no – no. 1 classifieds portal Sandrew Metronome – movie distribution/production Scanpix – picture agency Bokkilden – Internet bookstore Schibsted Mobile – mobile services Schibsted Forlagene – publishing house TV 2 – no. 1 commercial TV-channel Sweden Aftonbladet - no. 1 newspaper in the Nordic area Svenska Dagbladet – leading morning newspaper Blocket – no. 1 classifieds portal Sandrew Metronome – movie distribution/production Metronome – tv/film production Schibsted Mobile – mobile services Denmark/Finland Sandrew Metronome - movie distribution/production Schibsted Mobile – mobile services Switzerland/Spain/France 20 Minutes – free newspaper Estonia Eesti Meedia – media group Kanal 2 – leading commercial TV-channel Latvia/Lithuania Schibsted Mobile – mobile services ZLG -- publishing house

89 Enskilda Securities Nordic Seminar Schibsted – historical development 1839Chr. Schibsted Forlag (publishing house) founded 1860Christiania Adresseblad launched in Oslo – renamed Aftenposten in Takeover of VG 1989Reorganisation from a private family company to a limited company 1992Listing at the Oslo Stock Exchange with a growth strategy declaration 1992First TV and film investments 1995First New Media/Internet investments 1995 First investments in Kanal 2 in Estonia 1996Acquisition of Aftonbladet 1998 Acquisition of Svenska Dagbladet 1998 Investment in Eesti Meedia Group 1999 Launch of the free newspaper concept 20 Minutes

90 Enskilda Securities Nordic Seminar VG Dagbladet Aftenposten Nettavisen 2) Development of the largest online newspapers in Norway Unique monthly visitors, figures in thousands Note: calculated based on weekly visitors 1)Includes TV 2 and Nettavisen 2)Nettavisen reported separately until September 2003 Source:Gallup RedMeasure TV 2 1)

91 Enskilda Securities Nordic Seminar Norway – top list unique visitors March 2004

92 Enskilda Securities Nordic Seminar Aftonbladet – unique visitors (monthly) Source: WIS - figures in thousands

93 Enskilda Securities Nordic Seminar Web Addresses ww.sandrewmetronome.se European Media Venture’s companies:

94 ŽLG

95 Enskilda Securities Nordic Seminar Top 20 shareholders Number of shares outstanding 3 : 69,250,000 Number of shareholders: 4,790 Foreign ownership: 44.1% 1) The company is buying via nominee accounts. Their holdings may appear twice if the buy via others on the list 2) As of Sept 10, ) 1,380,470 of these shares owned by Schibsted ASA

96 Enskilda Securities Nordic Seminar Investor Information Please visit Schibsted’s home pages: Register to subscribe to press releases Catharina Thorenfeldt. VP IR & Group Treasurer Elisabeth Blom Tindlund. Investor Relations Officer Tel:


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