PubliGroupe with positive 1st half of 2014
operating result – strong digital growth –
completion of Swisscom offer on
5 September 2014
Results for the period
ending 30 June 2014
02
Message from the Board of Directors
Message from the Board of
Directors to shareholders
Dear Ladies and Gentlemen, dear shareholders
of PubliGroupe
According to the final result following the expiration of the additional acceptance period on 25
August 2014 of the public tender offer by Swisscom
AG ("Swisscom") for all shares in PubliGroupe,
Swisscom's holding in PubliGroupe amount to
98.37%.
Swisscom has declared its offer successful and will
thus with the settlement of the offer, which is planned
for 5 September 2014, become the new owner of
PubliGroupe.
The Board of Directors of PubliGroupe is very satisfied with this outcome as it had recommended to its
shareholders to accept Swisscom's offer of CHF 214
per share. The Board is convinced that the offered
price is a fair and good price. When considering
the offers of Tamedia and Swisscom the Board of
Directors also concluded that – besides Swisscom's
higher offer price – strategic considerations favoured
Swisscom as the new owner of PubliGroupe, especially with the anticipated strengthening of the market
position of the directory platform local.ch.
Furthermore, the PubliGroupe Board of Directors is
of the view that promising development opportunities
could present themselves for the business segment
Digital & Marketing Services together with Swisscom.
The intended solution with Swisscom is not only an
interesting option for the different assets, but could
also offer attractive prospects for employees in the
future.
PubliGroupe — Results as of 30.06.2014
After the settlement of the offer, an extraordinary
shareholders' meeting of PubliGroupe will be called
to namely elect new board members proposed by
Swisscom.
We informed you earlier this year about the sale of
our 25.07% stake in FPH Freie Presse Holding AG to
Neue Zürcher Zeitung (NZZ-Mediengruppe) which already holds the remaining 74.93%. The completion of
this transaction with a value of CHF 53 million is subject to approval by the shareholders of PubliGroupe
which will be sought at the extraordinary general
meeting taking place after the settlement of the
Swisscom offer. The exact date of the extraordinary
general meeting has not yet been set.
We would like to thank all our current and former
shareholders for their interest and commitment
over the last years. We would like to express our
sincere thanks also to all employees of the different PubliGroupe companies, wishing them a successful and satisfying future with the new owner.
Yours sincerely
The Board of Directors of PubliGroupe
Lausanne, 29 August 2014
Message from the Chairman and the CEO
Dear Ladies and Gentlemen, dear shareholders
of PubliGroupe
In April 2014, when we decided to dispose of our historic core business of Media Sales through the sale
of Publicitas to Aurelius, a publicly listed company
traded on the Munich stock exchange, we declared
that we would be accelerating our digital strategy
through this divestment.
We indicated that the key pillars of the future strategy
were a focus on local.ch, the leading marketplace in
Switzerland where local supply and demand meet
up that we operate with our long-standing partner
Swisscom, and a concentration on the technologybased trading between suppliers and buyers of
media services.
These activities are exercised by Improve Digital,
Spree7, recently acquired Sellbranch and Zanox, the
leading performance advertising provider in Europe.
The premise for this strategy was the understanding that the influences of supply and demand in the
media world are changing in favour of the advertisers,
especially in light of the trend towards digital and social media, and the conviction that marketing managers seek technological platforms on which they can
upload adverts programmatically, in real time and in a
user-friendly manner.
03
bidding and automation exhibited a strong increase.
Across all entities digital revenues grew, whereby
each one of these assets is well positioned to play an
important role in a rapidly developing market environment.
Today PubliGroupe generates over 80% of sales with
digital products and services if revenue from the two
key associates local.ch (50% PubliGroupe) and Zanox
(47.5% PubliGroupe) is included. Young growth companies like Improve Digital and Spree7 increasingly
contribute to this digital revenue.
These positive developments as witnessed during
the first half of 2014 prove that the strategic direction
initiated under the leadership of CEO Arndt C. Groth
since his arrival in fall 2012 is heading in the right
direction.
In the future, PubliGroupe will be part of Swisscom
which has declared that they see additional potential in the local.ch business and want to write new
chapters in its success story. After the purchase,
Swisscom intends to sell off PubliGroupe's media
investments, while all options are being examined
with regard to the other entities.
Yours sincerely
The results for the first half of 2014 demonstrate the
accuracy of this strategy.
PubliGroupe delivered a positive operating result of
CHF 1.6 million (against CHF -9.9 million as of 30
June 2013) on the basis of a very strongly performing
local.ch.
Hans- Peter Rohner
Chairman of the Board of Directors
At the same time, digital revenue stemming from programmatic buying and selling of advertising, real-time
Arndt C. Groth
CEO
PubliGroupe — Results as of 30.06.2014
04
Key figures / General comments
Overview key figures PubliGroupe
PubliGroupe pro-forma (excl. Media Sales)
1st half year
1st half year
in millions of CHF
in millions of CHF
20142013
20142013
Billings (1)-4%
498.3518.9
Billings (1)+6%
122.9115.4
Net revenue
-1%
121.5122.5
Share in result of
associates+15%
12.611.0
Operating result
-
1.6
-9.9
Non-operating result
-
-45.61.2
Result attributable to
shareholders of
PubliGroupe Ltd
-
-46.4-9.5
Number of employees
at the end of the period
-57%
7371’732
Net revenue
+10%
61.455.4
Share in result of
associates+13%
12.511.0
Operating result
-
4.4
-1.3
Non-operating result
-
-3.01.2
Result attributable to
shareholders of
PubliGroupe Ltd
-
-0.4-0.5
Number of employees
at the end of the period
+5%
737702
(1) Billings represent the gross amounts billed to clients (including the value of ad space).
(1) Billings represent the gross amounts billed to clients (including the value of ad space).
General comments
Strongly improved operating result –
high net loss due to one-off effects
linked to sale of Publicitas
The operating result for the first six months of 2014
was positive at CHF 1.6 million vis-à-vis an operating
loss of CHF -9.9 million during the same period last
year.
The increase of the operating result over last year is
mainly due to the following factors: strong improvement of Media Sales (still consolidated until 30 June
2014) results, return to a more even revenue
distribution at Search & Find with local.ch and a very
small negative operating result at DMS despite
continued substantial investments in growth markets.
Excluding Publicitas, PubliGroupe generated over
80% of its sales with digital products and services if
associates revenue is included.
Online revenue for the whole Group (without Media
Sales) increased by 45% to reach CHF 30.2 million.
PubliGroupe's net result, on the other hand, is
negative with CHF -46.4 million for the first half of
2014 compared to the loss of CHF -9.5 million in
2013. The high loss occurred due to the result of the
sale of Publicitas (CHF -39.5 million) in the range as
communicated with the sale.
PubliGroupe — Results as of 30.06.2014
Overall stable net revenue
In the first half of 2014, net revenue reached
CHF 121.5 million (previous year: CHF 122.5 million).
In the first half of 2014, the total amounts billed to
clients reached CHF 498.3 million. For the first half of
2013, the figure was CHF 518.9 million (-4%).
The Group's balance sheet remains sound. The
reduction in PubliGroupe shareholders' equity is
mainly related to the net impact of divestments
(CHF -29.3 million) and the dividend payment
(CHF -4.4 million).
As of 30 June 2014, the Group's equity stood at
CHF 98.4 million (compared with CHF 135.0 million
at the end of 2013), or 38% of its total assets
(previous year: 30%).
The announced FPH transaction will improve the
liquidity of the Group by CHF 53 million at closing.
The completion of this transaction is still subject to
approval by the shareholders of PubliGroupe which
will be sought at the extraordinary general meeting
taking place after the settlement of the Swisscom
offer. At this point, the transaction has not yet been
considered in the accounts of PubliGroupe, neither in
the P&L nor in the balance sheet.
05
Key figures / General comments
Key figures business segments
Segment reporting - 1st half year
in millions of CHF
Media Sales
Search & Find
20142013
Digital & Marketing
Services
2014 2013
2014
Corporate
& others
20142013
2013
Billings (1)-7%
375.4403.5 +4% 74.371.4+10%46.642.2 -2%5.35.3
Net revenue
Share in result of
associates
Operating result
Non-operating result
Result attributable to
shareholders of
PubliGroupe Ltd
Number of employees
at the end of the period
-10% 60.1 67.1
+7%
51.4 48.0 +44% 7.2 5.0 -2% 5.3 -
-
-
0.1
-2.8 -42.6
-
-8.6
-
+29% +101% -
7.5 9.4 -
5.8 4.6 -
-15%
-
-
3.7
-0.3 -
4.3 0.3 -
+46% -25% -
-
-46.0
-9.0
+61% 7.1 4.4 -
-0.3 0.7 -
-7.2
-5.6
-
-
1’030
+2% 556 547 +29% 121 94 -2% 60 61
5.3
1.3 0.9
-4.7 -6.2
-3.0
1.2
(1) Billings represent the gross amounts billed to clients (including the value of ad space).
Media Sales
Search & Find
The sale of Publicitas to the German company
Aurelius was closed by 30 June 2014 after PubliGroupe shareholders and competition
authorities had given their approval and all formalities
for the transaction were fulfilled.
At Search & Find, net revenue increased by 7% from
CHF 48.0 million in 2013 to CHF 51.4 million in 2014.
In line with previous years, online revenues continued
to grow at a double-digit rate.
For the first six months 2014 Media Sales accounted
for an operating loss of CHF -2.8 million (previous
year: CHF -8.6 million).
The operating result strongly increased from CHF 4.6
million in 2013 to CHF 9.4 million in 2014 for the first
six months.
Contrary to last year, the income pattern of Search
& Find with local.ch became more evenly distributed
between the first and the second semester. In 2014,
there were more phone books produced than in the
first half of 2013. This effect will be compensated in
the second half of 2014.
As of 30 June 2014, the Search & Find business
segment had 556 FTE (end of June 2013: 547 FTE).
PubliGroupe — Results as of 30.06.2014
06
General comments
Digital & Marketing Services (DMS)
Corporate & others
In the first six months of 2014, DMS produced an
operating result of CHF -0.3 million compared to
CHF 0.3 million in 2013.
Corporate & others posted an operating loss in the
first half of 2014 of CHF -4.7 million (previous year:
CHF -6.2 million). The result of press investments
improved slightly from CHF 0.9 million to CHF 1.3
million.
Continued development costs in strong growth
companies provided for the lower 2014 result. In
particular, investments occurred in Improve Digital, a
leading sell-side platform technology provider in
Europe, and Spree7, provider of a real-time advertising trading desk for independent advertising
agencies.
In addition, there was a restructuring charge with
RLVNT (previously SVBmedia) that continued to shift
from being a traditional media agency to becoming a
digital full-service agency.
Business volume, on the other hand, improved
strongly at DMS for the first half of 2014. Net revenue
saw a 44% increase from CHF 5.0 million in 2013 to
CHF 7.2 million in 2014. Substantial growth at
Improve Digital and Spree7, the two key developing
companies, were the main reasons for this positive
development.
DMS also slightly profited from a newly acquired
business in Scandinavia, Sellbranch, consolidated
since June 2014. RLVNT, on the other hand, saw a
decrease in revenue.
At Zanox (47.5% PubliGroupe, 52.5% Axel Springer),
whose revenue is not consolidated in the figures
of PubliGroupe, the 5% growth seen for the full year
in 2013 was slightly improved for the first six months
of 2014. The 6% growth in net revenue in the first
semester is a very strong sign that the European
leader in performance advertising continues to find
new business.
Net revenue grew from EUR 226.3 million last year to
EUR 239.3 million in 2014. In 2014, Zanox's
operating result reached EUR 7.9 million, up 1%
compared to the previous year (2013: EUR 7.8
million).
DMS headcount as of 30 June (excluding Zanox)
increased from 94 FTE in 2013 to 121 at the end of
June 2014.
PubliGroupe — Results as of 30.06.2014
As of 30 June 2014, Corporate & others counted 60
FTE (end of June 2013: 61 FTE). At the headquarters, 32 FTE were employed at the end of June 2014.
Much smaller Group with fewer FTEs
after sale of Publicitas
With the sale of Publicitas, PubliGroupe significantly
reduced the complexity of its structure and organisation. While the Group counted 1'732 employees (FTE)
at the end of June 2013, this number is down to 737
FTE at the end of June 2014 (without Media Sales).
Corporate Governance
The 123rd Annual General Meeting of PubliGroupe
Ltd, held on 29 April 2014, confirmed the proposed
amendments of the Articles of Association, in particular the change of purpose of PubliGroupe Ltd allowing for the sale of Publicitas as well as the cancellation of the statutory restriction of voting rights of
shareholders. The amendments regarding the Ordinance against Excessive Compensation in Public
Corporations were also accepted.
Outlook for 2014
Excluding Media Sales, PubliGroupe anticipates
consolidated net revenue of around CHF 150 million
with an operating result in the range of CHF 15-20
million for 2014.
In fall 2014, the execution of the previously announced sale of PubliGroupe's 25.07% stake in FPH
Freie Presse Holding AG to Neue Zürcher Zeitung
(NZZ-Mediengruppe) will take place. The completion
of this transaction amounting to CHF 53 million is
subject to approval by the shareholders
of PubliGroupe which will be sought at the extraordinary general meeting taking place after the settlement
of the Swisscom offer. This transaction will have a
CHF 22.1 million non-operating loss effect (due to the
reversal of acquired goodwill that was offset with
equity). Shareholders' equity will increase by CHF 7.4
million.
General comments
07
Swisscom offer
According to the definitve final result, the holding of Swisscom in PubliGroupe
amounts to 98.37%. The tender offer will be completed on 5 September 2014.
With the settlement of the offer, Swisscom will become the new main shareholder of PubliGroupe and has announced that it will apply for cancellation of
those PubliGroupe shares that have not been tendered. Minority shareholders
will receive the offer price as compensation for the cancellation of their
shares.
Development of PubliGroupe
share price compared with the SPI
in CHF
200
180
160
140
120
100
80
60
2012
2013
2014
PubliGroupe, registered share
Swiss Performance Index (SPI)
PubliGroupe — Results as of 30.06.2014
08
Extract from the interim financial report
Extract from the interim
financial report
Consolidated interim income statement
Consolidated interim income statement
1st half year
1st half year
2014
2013
Billings *
498.3
518.9
Net revenue
121.5
122.5
in millions of CHF
Purchases
-8.7
-9.9
112.8
112.6
Personnel expenses
-82.4
-95.6
General and administrative expenses
-40.4
-36.8
Depreciation of tangible assets
-0.5
-1.2
Amortisation of intangible assets
-1.2
-1.2
Gross profit
Other operating income
Other operating expenses
Share in result of associates
Operating result
Financial result
Ordinary result
0.7
1.5
-
-0.2
12.6
11.0
1.6
-9.9
-0.3
-0.6
1.3
-10.5
Non-operating result
-45.6
1.2
Result before income taxes and minority interests
-44.3
-9.3
Income taxes
Result before minority interests
Minority interests
Result attributable to shareholders of PubliGroupe Ltd
Earnings per share (in CHF)
* Billings represent the gross amounts billed to clients (including the value of ad space).
PubliGroupe — Results as of 30.06.2014
-0.9
-0.5
-45.2
-9.8
-1.2
0.3
-46.4
-9.5
-20.93
-4.26
09
Extract from the interim financial report
Consolidated balance sheet
Consolidated balance sheet
in millions of CHF
as of 30
June
as of 31
December
2014
2013
Cash and cash equivalents
29.4
56.5
Marketable securities
14.5
13.5
Trade receivables
33.7
172.9
Other receivables
19.2
30.1
Assets
Accrued income and prepaid expenses
8.1
19.4
104.9
292.4
32.8
32.7
-
0.6
Equipment
2.0
4.8
Intangible assets
4.5
4.1
Investments in associates
74.9
79.5
Financial assets
38.4
39.3
Current assets
Investment properties
Owner-occupied properties
Deferred tax assets
1.8
2.7
Non-current assets
154.4
163.7
Total assets
259.3
456.1
Liabilities and equity
Current debts
40.1
42.6
Trade payables
25.2
114.3
Other payables
10.3
26.5
Accrued expenses and deferred income
67.4
97.7
Current provisions
2.1
5.8
Current liabilities
145.1
286.9
Non-current debts
0.2
0.2
Share in negative equity of associates
3.9
12.3
Deferred tax liabilities
1.7
3.9
Non-current provisions
2.6
6.0
Non-current liabilities
8.4
22.4
153.5
309.3
Total liabilities
Share capital PubliGroupe Ltd
Treasury shares
Capital reserves
Retained earnings
Equity, shareholders of PubliGroupe Ltd
Minority interests
2.3
2.3
-34.5
-34.5
-0.3
-0.3
130.9
167.5
98.4
135.0
7.4
11.8
Total equity
105.8
146.8
Total liabilities and equity
259.3
456.1
Most of the figures as of 30 June 2014 are not comparable to those as of 31 December 2013 due to the
disposal of the business segment Media Sales.
PubliGroupe — Results as of 30.06.2014
10
Extract from the interim financial report
Consolidated interim cash flow statement
Consolidated interim cash flow statement
in millions of CHF
1st half year
1st half year
2014
2013
Result before minority interests
-45.2
-9.8
Share in result of associates
-12.6
-11.0
Depreciation and amortisation (incl. non-operating)
2.2
2.8
Changes in provisions (incl. deferred income taxes)
-2.3
-4.7
-
0.1
Gain (-) / loss on disposals of fixed assets
Gain (-) / loss on disposals of subsidiaries and associates
Adjustments for other non-cash items
Dividends received
Interest received
Interest paid
Taxes paid
Changes in trade receivables
39.5
-
1.0
0.6
13.3
16.3
0.5
0.4
-1.0
-0.8
2.2
-4.5
28.3
6.6
-14.1
-19.9
Changes in trade payables
-5.3
21.7
Changes in other payables, accrued expenses and deferred income
-0.8
-1.3
5.7
-3.5
Acquisitions of tangible assets
-0.1
-0.6
Acquisitions of intangible assets
-2.4
-3.6
Disposals of intangible assets
0.3
-
Disposals of marketable securities
0.1
-
Acquisitions of subsidiaries, net of cash acquired
-1.1
-0.2
Disposals of subsidiaries, net of cash disposed of
-21.5
0.2
Changes in other receivables, accrued income and prepaid expenses
Cash flows from operating activities
Investments in financial assets
-2.5
-
Divestments of financial assets
2.2
0.7
Taxes paid
Cash flows from investing activities
Increase in bank debts
Repayment of bank debts
Repayment of non-current debt
0.9
-
-24.1
-3.5
1.0
1.5
-
-0.3
-0.3
-0.3
-
-25.2
Dividend paid to shareholders of PubliGroupe Ltd
-4.4
-22.1
Dividends paid to minority interests by Group companies
-4.9
-6.4
Cash flows from financing activities
-8.6
-52.8
Effect of exchange rates on cash and cash equivalents
-0.1
0.5
-27.1
-59.3
Cash and cash equivalents as of 1 January
56.5
162.2
Cash and cash equivalents as of 30 June
29.4
102.9
Purchase of treasury shares
Change in cash and cash equivalents
The tables on pages 8 to 10 of this publication have been taken from the interim financial report.
The complete interim financial report is available for download at the following internet address:
http://www.publigroupe.com/investor-media-relations.html
PubliGroupe — Results as of 30.06.2014
11
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PubliGroupe — Results as of 30.06.2014
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