TALENTUM OYJ INTERIM REPORT JULY 23, 2008 AT 8.30 AM
TALENTUM INTERIM REPORT JANUARY-JUNE 2008
FOCUSING ON CORE OPERATIONS BRINGS RESULTS
April-June 2008 in brief
- Consolidated net sales amounted to EUR 27.1 million (EUR 25.6 million).
- Publishing's net sales went up by 18.6%.
- Operating profit (EBIT) EUR 2.7 million (EUR 0.9 million).
- Publishing performed as expected in Finland, but in Sweden integration
expenses
MEUR 0.5 million hampered profit.
- The net sales for online business increased by 106% from EUR 1.4 million to
2.9
million, expenses EUR 0.4 million over the previous year.
- Earnings per share EUR 0.04 (EUR 0.01).
January-June 2008 in brief
- Consolidated net sales amounted to EUR 53.8 million (EUR 51.9 million).
- Operating profit (EBIT) EUR 6.3 million (EUR 4.9 million).
- Earnings per share EUR 0.09 (EUR 0.08).
- Non-core operations divested.
KEY INDICATORS, CONTINUING OPERATIONS *)
--------------------------------------------------------------------------------
| EUR million | 4-6/ | 4-6/ | Change | 1-6/ | 1-6/ | Change | 1-12/ |
| | 2008 | 2007 | % | 2008 | 2007 | % | 2007 |
--------------------------------------------------------------------------------
| Net sales | 27.1 | 25.6 | 6.0 | 53.8 | 51.9 | 3.7 | 101.2 |
--------------------------------------------------------------------------------
| Operating | 2.7 | 0.9 | 198.1 | 6.3 | 4.9 | 28.3 | 12.7 |
| profit | | | | | | | |
--------------------------------------------------------------------------------
| as % of net | 10.0 | 3.5 | | 11.8 | 9.5 | | 12.6 |
| sales | | | | | | | |
--------------------------------------------------------------------------------
| Operating | 2.7 | 2.6 | 3.8 | 6.3 | 6.6 | -4.5 | 13.8 |
| profit without | | | | | | | |
| non-recurring | | | | | | | |
| items | | | | | | | |
--------------------------------------------------------------------------------
| as % of net | 10.0 | 10.2 | | 11.8 | 12.8 | | 13.6 |
| sales | | | | | | | |
--------------------------------------------------------------------------------
| Total assets | | | | 62.8 | 94.8 | -33.7 | 89.0 |
--------------------------------------------------------------------------------
| Investments | 0.6 | 4.0 | -84.5 | 1.2 | 4.8 | -74.5 | 10.8 |
--------------------------------------------------------------------------------
| as % of net | 2.3 | 15.7 | | 2.3 | 9.3 | | 10.7 |
| sales | | | | | | | |
--------------------------------------------------------------------------------
| Equity ratio % | | | | 38.9 | 29.7 | | 36.7 |
--------------------------------------------------------------------------------
| Gearing ratio, | | | | -6.5 | 29.2 | | 16.7 |
| % (net debt to | | | | | | | |
| equity) | | | | | | | |
--------------------------------------------------------------------------------
| Interest-bearin | | | | 7.4 | 30.6 | -75.8 | 19.2 |
| g liabilities | | | | | | | |
--------------------------------------------------------------------------------
| Net interest- | | | | -1.6 | 8.0 | -120.0 | 5.3 |
| bearing | | | | | | | |
| liabilities | | | | | | | |
--------------------------------------------------------------------------------
| Personnel on | | | | 862 | 892 | -3.4 | 896 |
| average | | | | | | | |
--------------------------------------------------------------------------------
| Earnings per | 0.04 | 0.01 | 209.5 | 0.09 | 0.08 | 13.7 | 0.19 |
| share, EUR | | | | | | | |
--------------------------------------------------------------------------------
| Cash flow from | 0.11 | 0.13 | -13.5 | 0.12 | 0.21 | -41.9 | 0.30 |
| operating | | | | | | | |
| activities per | | | | | | | |
| share, EUR | | | | | | | |
--------------------------------------------------------------------------------
| Equity per | | | | 0.56 | 0.58 | -4.7 | 0.69 |
| share, EUR | | | | | | | |
--------------------------------------------------------------------------------
| Market | | | | 129.1 | 149.7 | -13.8 | 121.1 |
| capitalization | | | | | | | |
| on closing rate | | | | | | | |
| at period end | | | | | | | |
--------------------------------------------------------------------------------
*) These figures do not include TV content production.
CEO JUHA BLOMSTER:
“Talentum's net sales increased by 4% in the first half of the year, despite
divesting certain premedia businesses. Operating profit is up by 28%, and the
operating profit percentage was almost 12.
“Publishing's net sales increased by about 15% in April-June, bringing the total
increase in January-June to almost 20%. Despite major investment in online
operations and new products, the operating profit in Publishing remained at last
year's level. Operations in Sweden did not develop as expected in the second
quarter, however, we estimate the performance to develop more positively on the
latter half of the year.
“Net sales in online operations increased by 106% in the first half of the year.
Investment in circulation sales has been productive, and magazine circulation
figures have increased. Advertising sales for magazines increased by 5% in
Finland and 8% in Sweden, and circulation revenue increased by 5% in both
countries.
“The diversification of our publishing earning structure, a central goal of
ours, is progressing well. We are also investing in our training business,
trusting that the product names Talentum Legal Training and Talentum Training
will help profile our services for a broader customer base and link them to our
other products, generating synergy benefits in sales and marketing. The net
sales of our book publishing, training and information services almost doubled
in the second quarter, and the growth from the beginning of this year has been
almost 50%.
“The competitiveness and success of Talentum's products are based on quality
that is being constantly developed. In early May, Talentum introduced a new
online ad option for advertisers, allowing better targeting of ads to content,
thus serving both advertisers and readers. Our online services are being
updated, the latest development being the appearance of Arvopaperi.fi, a
securities website whose stock exchange service is shared with Talouselama.fi.
“According to the TNS PäättäjäAtlas survey of decision-makers published in May,
Talentum media have increased their readership among decision-makers.
Talouselämä magazine attained the leading position among financial media with a
readership of 85,000 among corporate decision-makers. Tekniikka & Talous has
44,000, and these two magazines together reach almost 60% of Finnish
decision-makers. In Sweden, the Orvesto Näringsliv 2008 reader poll showed that
Affärsvärlden is performing better than its competitors, with a readership of
62,000, and that Ny Teknik has increased its corresponding figure to 152,000.
“In its strategy of focusing on its core operations, Talentum has moved even
more quickly than we had anticipated. In the first half of this year, we sold
our TV content production and Premedia functions related to digital content
management and package printing materials. Almost 100% of our net sales is now
derived from our core operations, and we can focus all our resources on its
development.
“In accordance with our strategy, we are also looking at growth options through
corporate acquisition. We have set goals for the near future, keeping in mind
the primary goal of increasing owner value.”
Operating environment and seasonal variations
The general economic situation has clearly deteriorated in Finland and Sweden
during the second quarter. GDP growth predictions for the current year have
decreased as the year has progressed. Financial insecurity is expected to
increase towards the end of the year.
According to TNS Gallup, media advertising in Finland grew by 3.3% in
January-June. Second-quarter figures for Sweden are not available, but the
growth estimate for media advertising in Sweden for the entire year is 3.1%
(Institutet för Reklam- och Mediestatistik). Job advertising continued to
increase in January-June in both Finland and Sweden.
According to the Finnish Audit Bureau of Circulations, the circulation of every
other magazine that it examined increased slightly or remained stable. The
advent of new magazines onto the market and investment by old magazines in
marketing their circulation were characteristic of the period examined. Growth
in the circulation of special-interest magazines was also typical.
Talentum's business operations are subject to seasonal variations. In the
spring, the Easter break falls in the first or second quarter, and this has an
effect on the financial performance of these two periods. However, the first
half of the year as a whole is comparable. During the summer holidays, magazines
and books do not generally come out, and for this reason the third quarter is
the lowest in terms of sales. Business is at its liveliest during the final
quarter of the year. The majority of book sales typically occur in the final
quarter.
Consolidated net sales and financial performance April-June
The consolidated net sales recorded by Talentum's continuing operations in
April-June amounted to EUR 27.1 million (EUR 25.6 million). Publishing's net
sales went up by 18.6% to EUR 24.4 million (EUR 20.6 million). The business
operations acquired in Sweden in 2007 accounted for EUR 2.4 million of the
growth in net sales. Premedia's net sales fell as a result of corporate
restructuring.
This year, the comparability of Publishing's net sales is affected by the Easter
break falling in the first quarter. However, the first half of the year is
comparable with the same period last year in this respect.
The consolidated operating profit of the continuing operations in April-June
amounted to EUR 2.7 million (EUR 0.9 million), i.e. 10.0% of the net sales
(3.5%). Publishing's operating profit was EUR 3.1 million (EUR 2.9 million). The
profitability was weakened by functions acquired in Sweden in 2007 and by new
magazines founded. In the comparison period Premedia's profit included a
non-recurring cost of MEUR 1.7 million as a result of restructuring.
Net financial expenses amounted to EUR -0.1 million (EUR -0.2 million).
Associated companies contributed EUR 0.2 million (EUR 0.0 million) to the
financial performance.
The profit of continuing operations before taxes was EUR 2.8 million (EUR 0.7
million).
Consolidated net sales and financial performance January-June
The consolidated net sales recorded by Talentum's continuing operations in
January-June amounted to EUR 53.8 million (EUR 51.9 million). Publishing's net
sales went up by 14.5% to EUR 47.5 million (EUR 41.5 million). The business
operations acquired in Sweden in 2007 accounted for EUR 4.6 million of the
growth in net sales. Premedia's net sales fell by EUR 4.3 million as a result of
corporate divestment.
The consolidated operating profit of the continuing operations in January-June
amounted to EUR 6.3 million (EUR 4.9 million), i.e. 11.8% of the net sales
(9.5%). Publishing's operating profit was EUR 6.7 million (EUR 6.8 million). The
comparability of this figure is affected by functions acquired in 2007 in
Sweden, to a total of about EUR -1.0 million. Premedia improved its financial
performance on the last year as a result of corporate restructuring.
TV content production, sold off in the first quarter, was classified as a
discontinued operation as of January. The impact of TV content production on
financial performance is given in whole under discontinued operations in the
income statement. The sale of the major part of TV content production resulted
in a sales profit of EUR 0.8 million, while the sale of Oy Filmiteollisuus Fine
Ab caused a sales loss of EUR 0.4 million.
Net financial expenses amounted to EUR -0.3 million (EUR -0.3 million).
Associated companies contributed EUR -0.3 million (EUR -0.1 million) towards the
financial performance, an amount that includes not only the performance in the
period under review but also EUR 0.3 million from an associated company's losses
that were incurred in the previous financial period but detected after the
balance sheet date.
The profit of continuing operations before taxes was EUR 5.8 million (EUR 4.6
million).
The sector's and Talentum's prospects for 2008
The uncertainty in the economic situation has increased towards the summer, and
the latest economic forecasts in particular have been downwards. This means that
attaining goals set previously will probably be more challenging than
anticipated.
Nevertheless, Talentum is keeping the forecast for the entire year unchanged and
expects the net sales of the core operations to increase over the previous year
and the operating profit to improve in 2008 in spite of the costs of integrating
the acquired businesses and developing the online business.
Risks to business operations in the near future
The biggest risk to the Group's business operations is associated with product
and job advertising, which is sensitive to economic trends. About 40% of the
consolidated net sales are tied to advertising at the annual level. We endeavour
to control this market risk by increasing revenue from circulation sales and
content sales.
Cash flow, financial position and balance sheet
The cash flow from business operations in January-June was EUR 5.3 million (EUR
9.3 million). The change in working capital was EUR 0.1 million (EUR 3.1
million).
The consolidated balance sheet total was reduced considerably as a result of the
sale of TV content production and at the end of June stood at EUR 62.8 million
(EUR 89.0 million on 31 December 2007). Interest-bearing net liabilities were
EUR -1.6 million (EUR 5.3 million). The Group's liquid assets, EUR 9.0 million
(EUR 13.8 million), have been invested mostly in financial instruments. The
consolidated loans and borrowing amounted to EUR 7.4 million (EUR 19.2 million).
At the end of the period under review, there were commercial papers outstanding
to the value of EUR 4.0 million (EUR 14.0 million).
In order to minimize the Group's liquidity risk, Talentum Oyj agreed on a
current account credit facility of EUR 12.0 million for the Group for three
years in February and a financial credit facility of EUR 20.0 million. Of the
financial credit facilities, loans can be withdrawn or paid back within the
framework of the rules during the limit's maturity time of three years. The
limits had not been used as at 30 June 2008.
The equity ratio was 38.9% at the end of June (36.7% on 31 December 2007). The
Group's equity per share was EUR 0.56 (EUR 0.69 on 31 December 2007).
Investment
Gross investment in tangible and intangible assets in continuing operations in
January-June totalled EUR 1.2 million (EUR 4.8 million), i.e. 2.3% (9.3%) of net
sales. Investment in the comparable period includes the acquisition of Dagens
Media.
Of the investment, EUR 0.8 million was spent on developing online business
recognized as an asset, and the rest comprised normal replacement and
maintenance investment, such as procuring equipment, software and fixtures.
Group restructuring
On 22 January 2008, Talentum Oyj and CapMan Plc agreed that a company
established by the CapMan Buyout VIII Fund, which is managed by CapMan Plc,
would purchase the major part of Varesvuo Partners Oy, which focuses on TV
content production. The transaction was concluded on 20 February 2008. The
sub-group Oy Filmiteollisuus Fine Ab was sold on 28 March 2008 to Yellow Film &
TV Oy, which is owned by members of the executive management of Oy
Filmiteollisuus Ab. TV content production's net sales in 2007 amounted to EUR
22.9 million, and it employed 95 people.
The operating result of TV content production, apart from the Oy Filmiteollisuus
Fine Ab sub-group, is not included in the Group's financial performance for
January-June 2008. The sales profit created by the transactions and the
financial performance of TV content production are shown under discontinued
operations in the income statement for January-June 2008 and for 2007.
Most of the Premedia functions were divested in accordance with the strategy. In
February, the Talentum Group sold the entire shareholding of DH Tools Oy, which
focused on digital data management, and in April it sold the entire shareholding
of Sata-Flexo Oy and Marvaco Oy, companies in the package printing materials
function.
Personnel
During January-June, the Talentum Group employed an average of 862 (892) people.
Geographically, the personnel were divided as follows: Finland 492 people (580),
Sweden 187 (120), Latvia 80 (75), Lithuania 28 (20), Estonia 67 (82) and Russia
8 (15).
BUSINESS AREAS
Publishing
--------------------------------------------------------------------------------
| EUR million | 4-6/2008 | 4-6/2007 | 1-6/2008 | 1-6/2007 | 1-12/2007 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales | | | | | |
--------------------------------------------------------------------------------
| Advertising | 11.9 | 11.4 | 23.5 | 22.1 | 42.6 |
| revenue | | | | | |
--------------------------------------------------------------------------------
| Circulation | 6.6 | 6.2 | 12.8 | 12.1 | 24.3 |
| revenue | | | | | |
--------------------------------------------------------------------------------
| Other revenue | 5.9 | 3.0 | 11.2 | 7.3 | 16.9 |
--------------------------------------------------------------------------------
| Total | 24.4 | 20.6 | 47.5 | 41.5 | 83.8 |
--------------------------------------------------------------------------------
* ‘Other revenue' includes books, training and information services.
April-June
Publishing's net sales in April-June amounted to EUR 24.4 million (EUR 20.6
million), an increase of 18.6% over the previous year. The business operations
acquired in Sweden during 2007 brought net sales of EUR 2.4 million.
Advertising revenue rose by 5% in Finland and by 5% in Sweden. Recruitment
advertising continued strong in Talentum media in both Finland and Sweden. The
circulation revenue from Talentum's magazines grew by 4% in Finland and 8% in
Sweden. The net sales of other content sales are increased by the acquisition of
Talentum Fakta in November 2007.
Online business showed a growth of 106% in the second quarter, totalling 12% of
Publishing's net sales at EUR 2.9 million (EUR 1.4 million).
This year, the comparability of Publishing's net sales is affected by the Easter
break falling in the first quarter. However, the first half of the year is
comparable with the same period last year in this respect.
Publishing's operating profit (EBIT) was EUR 3.1 million (EUR 2.9 million). In
Finland, Publishing performed as expected. In Sweden, on the other hand, profit
was weakened by the integration costs of Talentum Fakta and Dagens Media, and
the costs of launching a new magazine, which were higher than anticipated in the
period under review. Planned investment in online operations resulted in costs
about EUR 0.4 million higher than a year earlier, and also EUR 0.5 million was
recognized in assets during the period under review. The investment now made in
increasing circulation sales will translate into profit in the future.
January-June
Publishing's net sales in January-June amounted to EUR 47.5 million (EUR 41.5
million), an increase of 14.5% over the previous year. The business operations
acquired in Sweden during 2007 brought net sales of EUR 4.6 million.
The circulation revenue from Talentum's magazines grew by 6% in Finland and 6%
in Sweden. Advertising revenue rose by 5% in Finland and 8% in Sweden.
Online business showed a growth of 106%, totalling 12% of Publishing's net sales
at EUR 5.9 million (EUR 2.9 million).
Publishing's operating profit (EBIT) was EUR 6.7 million (EUR 6.8 million). The
financial performance of the business operations acquired in Sweden during 2007
did not attain the goals set. Operating profit in companies acquired and
magazines launched during 2007 was EUR -1.0 million. In Publishing investment in
online operations resulted in costs about EUR 0.8 million higher than a year
earlier, and also EUR 0.8 million in development costs were recognized as assets
during the period under review. Online operations development is weighted toward
the first half of the year.
Publishing's net sales and operating profit by country
--------------------------------------------------------------------------------
| EUR million | 4-6/2008 | 4-6/2007 | 1-6/2008 | 1-6/2007 | 1-12/2007 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales | | | | | |
--------------------------------------------------------------------------------
| Finland | 14.0 | 12.8 | 28.2 | 27.0 | 53.9 |
--------------------------------------------------------------------------------
| Sweden and | 10.4 | 7.8 | 19.3 | 14.5 | 29.9 |
| other | | | | | |
--------------------------------------------------------------------------------
| Total | 24.4 | 20.6 | 47.5 | 41.5 | 83.8 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating | | | | | |
| profit | | | | | |
--------------------------------------------------------------------------------
| Finland | 1.9 | 1.4 | 4.9 | 4.6 | 10.6 |
--------------------------------------------------------------------------------
| Sweden and | 1.2 | 1.5 | 1.8 | 2.2 | 4.2 |
| other | | | | | |
--------------------------------------------------------------------------------
| Total | 3.1 | 2.9 | 6.7 | 6.8 | 14.8 |
--------------------------------------------------------------------------------
Direct Marketing
April-June
Direct Marketing's net sales in April-June amounted to EUR 2.6 million (EUR 2.4
million), and the operating profit (EBIT) was EUR 0.2 million (EUR 0.3 million).
Expansion in Finland and the Baltic states increased expenses but will increase
revenue in the future.
January-June
Direct Marketing's net sales in January-June amounted to EUR 5.2 million (EUR
4.8 million), and the operating profit (EBIT) was EUR 0.6 million (EUR 0.7
million). Net sales grew as expected. Expansion in Finland and the Baltic states
increased expenses but will increase revenue in the future.
Premedia
April-June
The net sales of the Premedia business area in April-June amounted to EUR 1.5
million (EUR 3.9 million), and the operating profit (EBIT) was EUR 0.3 million
(EUR -1.4 million). The divestments of the business area have reduced net sales.
The package printing materials function was sold in April. The Premedia function
remaining is prepress production, which supports the core operations of the
Group. The net sales and financial performance of this function have developed
as expected.
January-June
The net sales of the Premedia business area in January-June amounted to EUR 3.8
million (EUR 8.0 million), and the operating profit (EBIT) was EUR 0.6 million
(EUR -1.2 million).
AGM, Board and auditor
Talentum's Annual General Meeting was held on 27 March 2008. The meeting
confirmed the financial statements for 1 January - 31 December 2007 and granted
the company's Board of Directors and CEO exemption from liability.
The AGM re-elected Manne Airaksinen, Harri Kainulainen, Eero Lehti, Kai Mäkelä,
Atte Palomäki and Tuomo Saarinen members of the Board of Directors. Tuomo
Saarinen was re-elected Chairman of the Board of Directors, and Manne Airaksinen
was re-elected Deputy Chairman.
Authorized Public Accountants PricewaterhouseCoopers Oy with APA Juha Wahlroos
as the principal auditor were re-elected auditors.
The AGM on 27 March 2008 decided, on a motion by the Board of Directors, to
distribute a dividend of EUR 0.20 per share. The payment date was 8 April 2008,
and the record date was 1 April 2008.
Shares and share capital
At the end of the period under review, Talentum Oyj's share capital totalled EUR
18,593,518.79, comprising 44,295,787 fully paid-up shares. The shares are listed
on the OMX Nordic Exchange Helsinki.
At the end of the period under review, the company held 681,000 company shares,
representing about 1.5% of Talentum's total shares and votes.
A total of 7,467,489 shares were traded during the period under review, 16.9% of
the total average number of shares during the period under review.
Shareholdings of the Board of Directors and CEO
On 30 June 2008, the number of Talentum Oyj shares and options owned by members
of the Board of Directors and the CEO personally and through companies in which
they have a controlling interest was 4,723,996, representing 10.7% of the
company's total shares and votes.
Board of Directors' authorizations
Authorization of the Board of Directors to decide on a share issue including the
conveyance of own shares and issue of special rights
The Annual General Meeting on 27 March 2008 authorized the Board of Directors to
decide on a share issue which may be either liable to charge or free of charge,
including the issuing of new shares and the conveyance of own shares possibly in
the company's possession.
The Board of Directors has the right, by virtue of the authorization, to decide
on an issue of option rights and other special rights that grant entitlement,
against payment, to receive new shares or shares possibly in possession of the
company.
By virtue of the authorizations applying to a share issue and/or special rights,
new shares may be issued and/or shares in possession of the company may be
conveyed, in one or more lots, to a maximum total of 3,500,000 shares,
representing approximately 8% of the issued shares of the company.
The authorizations will remain in force until 30 June 2009.
The Board of Directors is otherwise authorized to decide on all the terms and
conditions for a share issue and the issuing of special rights, including the
right to decide on a directed share issue and issue of special rights.
Shareholders' pre-emptive subscription rights can be deviated from providing
that there is a significant financial reason for the company to do so.
Authorization of the Board of Directors to decide on acquisition of own shares
The Annual General Meeting on 27 March 2008 authorized the Board of Directors to
decide on the acquisition of the company's own shares. The shares can be
acquired for the value that is decided by the board of Directors and is based on
the fair value at the time of the acquisition formed for the shares in public
trading. Own shares may be only acquired with unrestricted equity.
By virtue of the authorization, a maximum of 3,500,000 own shares, representing
approximately 8% of the issued shares of the company, can be acquired, in one or
several lots.
The authorization will remain in force until 30 June 2009.
The Board of Directors is otherwise authorized to decide on all the terms and
conditions regarding the acquisition of own shares, including the manner of
acquisition of the shares. The authorization does not exclude the right of the
Board of Directors to also decide on a directed acquisition of own shares
providing that there is a significant financial reason for the company to do so.
Directed issue free of charge
The Talentum Board of Directors decided on 8 March 2007 to set up a share-based
incentive plan for the Group management. The Annual General Meeting on 27 March
2007 gave the Board authorization to decide on a share issue that would be
liable to charge and/or free of charge. The Board has decided to issue to the
people coming under the share-based incentive plan rewards in shares specified
according to the terms and conditions of the plan in question in the form of a
directed share issue free of charge, incorporating in total 74,970 new shares.
The shares were registered with the Trade Register on 20 March 2008.
Acquisition of own shares
The Board of Directors of Talentum Oyj decided on 26 February 2008, by virtue of
an authorization given by the Annual General Meeting on 27 March 2007, to
acquire a maximum of 500,000 of the company's own shares, which corresponds to
about 1.13% of all the company's shares. The shares will be acquired with the
company's distributable funds, and the acquisition of the shares will reduce the
company's distributable unrestricted equity. The shares will be acquired in
public trading on the OMX Nordic Exchange Helsinki at the price on the day of
purchase as provided by the law on the public trading of shares. The own shares
will be acquired for use as consideration in possible corporate acquisitions and
other arrangements when the company acquires assets relevant to its operations,
and for developing the company's main structure, including the possible further
conveying and cancellation of shares. There is therefore a significant financial
reason for acquiring the shares.
By 30 June 2008, the company had acquired the allowed 500,000 shares, and had in
its possession a total of 681,000 of the company's own shares.
Decreasing the share premium
The Annual General Meeting decided that the share premium as shown in the
balance sheet as at 31 December 2007 will be decreased by EUR 89,593,601.28. The
decreased amount will be transferred to the invested unrestricted equity fund.
After the decrease, the amount of the share premium in the balance sheet will be
zero.
The reduction of the share premium requires public notice to creditors and
registration procedure in accordance with chapter 14 sections 3-5 of the Limited
Liability Companies Act.
Management share-based incentive plan
The Group management of Talentum Oyj has a share-based incentive plan. The plan
includes three earning periods, which last for at least one financial year and
not more than three financial years. The first earning period began on 1 January
2007 and ended on 31 December 2007. The total length of the plan is five years.
The rewards will be paid partly in the Company's shares and partly in cash after
the end of each earning period. The proportion to be paid in cash will cover
taxes and tax-related costs arising from the reward. Transferring the shares
earned from the earning period 2007 within two years from the end of the earning
period is prohibited. After this, the CEO of the company must, however, own 50%
of the shares earned on the basis of the plan as long as the service of the CEO
continues and one year after the end of the service. The Board of Directors will
later decide on the following earning periods and transfer restrictions
concerning shares earned on the basis of those earning periods. The target group
in the plan for the 2008 earning period comprises 10 people.
Notifications
The Ilmarinen Mutual Pension Insurance Company declared on 3 June 2008 that
through a share transaction concluded on 2 June 2008 the percentage of votes and
share capital in Talentum Oyj represented by the Talentum shares in its
possession had exceeded one twentieth (1/20), at 5.26%.
Shareholder agreements
The company is not aware of any mutual shareholder agreements between its
shareholders relating to the operations or ownership of the company.
Liquidity providing agreement
An agreement with Nordea Securities Oyj on a liquidity providing for Talentum
Oyj shares became effective on 21 June 2004. Under the agreement, Nordea
Securities will submit a purchase and sale offer so that the maximum permitted
differential between them is 3% of the purchase offer. The offers will include a
minimum of 2,500 shares.
TABLES
CONSOLIDATED INCOME STATEMENT
--------------------------------------------------------------------------------
| | 4-6/ | 4-6/ | 1-6/ | 1-6/ | 1-12/ |
| | 2008 | 2007 | 2008 | 2007 | 2007 |
--------------------------------------------------------------------------------
| EUR million | | | | | |
--------------------------------------------------------------------------------
| CONTINUING OPERATIONS | | | | | |
--------------------------------------------------------------------------------
| Net sales | 27.1 | 25.6 | 53.8 | 51.9 | 101.2 |
--------------------------------------------------------------------------------
| Other operating income | 0.1 | 0.1 | 0.3 | 0.3 | 0.6 |
--------------------------------------------------------------------------------
| Material and services | -4.4 | -4.4 | -8.8 | -8.6 | -16.3 |
--------------------------------------------------------------------------------
| Employee benefit expenses | -12.6 | -12.3 | -24.6 | -24.0 | -45.1 |
--------------------------------------------------------------------------------
| Depreciation and | -0.4 | -0.6 | -0.9 | -1.2 | -2.3 |
| amortization | | | | | |
--------------------------------------------------------------------------------
| Other operating expenses | -7.1 | -7.5 | -13.5 | -13.4 | -25.4 |
--------------------------------------------------------------------------------
| Operating profit | 2.7 | 0.9 | 6.3 | 4.9 | 12.7 |
--------------------------------------------------------------------------------
| Financial income | 0.2 | 0.2 | 0.2 | 0.4 | 0.7 |
--------------------------------------------------------------------------------
| Financial expenses | -0.3 | -0.4 | -0.5 | -0.6 | -1.8 |
--------------------------------------------------------------------------------
| Share of results of | 0.2 | 0.0 | -0.3 | -0.1 | -0.1 |
| associates companies | | | | | |
| | | | | | |
--------------------------------------------------------------------------------
| Profit before taxes | 2.8 | 0.7 | 5.8 | 4.6 | 11.5 |
--------------------------------------------------------------------------------
| Taxes | -0.8 | -0.3 | -1.8 | -1.4 | -3.1 |
--------------------------------------------------------------------------------
| Profit for the period, | 2.0 | 0.4 | 4.0 | 3.3 | 8.4 |
| continuing operations | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| DISCONTINUED OPERATIONS | | | | | |
--------------------------------------------------------------------------------
| Profit for the period, | - | 0.3 | 0.4 | 0.4 | 0.8 |
| discontinued operations | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit for the period | 2.0 | 0.6 | 4.4 | 3.6 | 9.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Attributable to: | | | | | |
--------------------------------------------------------------------------------
| Equity holders of the | 2.0 | 0.6 | 4.4 | 3.6 | 8.8 |
| parent company | | | | | |
--------------------------------------------------------------------------------
| Minority interest | 0.0 | 0.0 | 0.0 | 0.1 | 0.4 |
--------------------------------------------------------------------------------
| Basic and diluted * | | | | | |
--------------------------------------------------------------------------------
| Earnings per share, EUR | 0.04 | 0.01 | 0.10 | 0.08 | 0.20 |
--------------------------------------------------------------------------------
| Earnings per share, | 0.04 | 0.01 | 0.09 | 0.08 | 0.19 |
| continuing operations, EUR | | | | | |
--------------------------------------------------------------------------------
*) Earnings per share are calculated on the profit attributed to the
shareholders of the parent company.
CONSOLIDATED BALANCE SHEET
--------------------------------------------------------------------------------
| | 30.6.2008 | 30.6.2007 | 31.12.2007 |
--------------------------------------------------------------------------------
| EUR million | | | |
--------------------------------------------------------------------------------
| ASSETS | | | |
--------------------------------------------------------------------------------
| Non-current assets | | | |
--------------------------------------------------------------------------------
| Property, plant and equipment | 2.0 | 7.0 | 6.6 |
--------------------------------------------------------------------------------
| Goodwill | 25.9 | 26.9 | 32.5 |
--------------------------------------------------------------------------------
| Other intangible assets | 12.2 | 12.2 | 11.8 |
--------------------------------------------------------------------------------
| Investments in associates | 0.5 | 2.8 | 2.1 |
--------------------------------------------------------------------------------
| Available-for-sale investments | 0.1 | 0.9 | 0.1 |
--------------------------------------------------------------------------------
| Deferred tax assets | 0.8 | 3.6 | 1.0 |
--------------------------------------------------------------------------------
| Receivables | 1.6 | 0.6 | 0.7 |
--------------------------------------------------------------------------------
| Total non-current assets | 43.0 | 53.9 | 54.9 |
--------------------------------------------------------------------------------
| Current assets | | | |
--------------------------------------------------------------------------------
| Inventories | 1.4 | 5.2 | 4.4 |
--------------------------------------------------------------------------------
| Trade and other receivables | 9.4 | 13.0 | 15.8 |
--------------------------------------------------------------------------------
| Cash and cash equivalents | 9.0 | 22.6 | 13.8 |
--------------------------------------------------------------------------------
| Total current assets | 19.8 | 40.8 | 34.1 |
--------------------------------------------------------------------------------
| TOTAL ASSETS | 62.8 | 94.8 | 89.0 |
--------------------------------------------------------------------------------
| EQUITY AND LIABILITIES | | | |
--------------------------------------------------------------------------------
| Equity attributable to | | | |
| shareholders of the parent | | | |
--------------------------------------------------------------------------------
| Share capital | 18.6 | 18.6 | 18.6 |
--------------------------------------------------------------------------------
| Share premium reserve | 5.9 | 5.9 | 5.9 |
--------------------------------------------------------------------------------
| Other reserves | -0.3 | 0.1 | -0.2 |
--------------------------------------------------------------------------------
| Treasury shares | -2.8 | -1.3 | -1.3 |
--------------------------------------------------------------------------------
| Retained earnings | 2.9 | 2.4 | 7.4 |
--------------------------------------------------------------------------------
| Total | 24.3 | 25.7 | 30.3 |
--------------------------------------------------------------------------------
| Minority interest | 0.1 | 1.6 | 1.6 |
--------------------------------------------------------------------------------
| Total equity | 24.4 | 27.3 | 31.9 |
--------------------------------------------------------------------------------
| Non-current liabilities | | | |
--------------------------------------------------------------------------------
| Deferred tax liabilities | 3.1 | 3.2 | 3.1 |
--------------------------------------------------------------------------------
| Interest-bearing liabilities | 2.3 | 3.3 | 3.8 |
--------------------------------------------------------------------------------
| Pension obligations | - | 0.1 | 0.1 |
--------------------------------------------------------------------------------
| Provisions | 0.9 | 1.7 | 1.4 |
--------------------------------------------------------------------------------
| Total non-current liabilities | 6.3 | 8.3 | 8.3 |
--------------------------------------------------------------------------------
| Current liabilities | | | |
--------------------------------------------------------------------------------
| Interest-bearing liabilities | 5.1 | 27.3 | 15.4 |
--------------------------------------------------------------------------------
| Trade and other payables | 26.8 | 31.4 | 33.1 |
--------------------------------------------------------------------------------
| Provisions | 0.2 | 0.3 | 0.3 |
--------------------------------------------------------------------------------
| Total current liabilities | 32.1 | 59.1 | 48.8 |
--------------------------------------------------------------------------------
| TOTAL EQUITY AND LIABILITIES | 62.8 | 94.8 | 89.0 |
--------------------------------------------------------------------------------
CONSOLIDATED CASH FLOW STATEMENT
--------------------------------------------------------------------------------
| EUR million | 1-6/ 2008 | 1-6/ 2007 | 1-12/ 2007 |
--------------------------------------------------------------------------------
| Cash flows from operating activities, | | | |
| continuing operations | | | |
--------------------------------------------------------------------------------
| Operating profit | 6.3 | 4.9 | 12.7 |
--------------------------------------------------------------------------------
| Adjustments to operating profit | -0.2 | 1.9 | 3.6 |
--------------------------------------------------------------------------------
| Change in working capital | 0.1 | 3.1 | -2.2 |
--------------------------------------------------------------------------------
| Financial items and taxes | -0.9 | -0.6 | -0.8 |
--------------------------------------------------------------------------------
| Net cash from operating activities | 5.3 | 9.3 | 13.3 |
--------------------------------------------------------------------------------
| Cash flows from investing activities, | | | |
| continuing operations | | | |
--------------------------------------------------------------------------------
| Acquisitions of subsidiaries and | | -3.2 | -6.4 |
| associates, net of cash | | | |
--------------------------------------------------------------------------------
| Disposal of subsidiaries and | 3.2 | 0.3 | 1.0 |
| associates, net of cash | | | |
--------------------------------------------------------------------------------
| Acquisition of property, plant and | -1.2 | -0.8 | -0.9 |
| equipment and intangible assets | | | |
--------------------------------------------------------------------------------
| Other items | 0.0 | -0.1 | 0.2 |
--------------------------------------------------------------------------------
| Net cash from investing activities | 2.1 | -3.7 | -6.0 |
--------------------------------------------------------------------------------
| Cash flow from financing activities, | | | |
| continuing operations | | | |
--------------------------------------------------------------------------------
| Change in current loans | -10.0 | 6.0 | -6.4 |
--------------------------------------------------------------------------------
| Proceeds from non-current loans | 0.0 | - | 1.4 |
--------------------------------------------------------------------------------
| Repayment of non-current loans | -0.9 | -0.9 | -1.1 |
--------------------------------------------------------------------------------
| Dividends paid | -8.8 | -7.9 | -8.0 |
--------------------------------------------------------------------------------
| Purchase of treasury shares | -1.5 | - | - |
--------------------------------------------------------------------------------
| Other items | 0.0 | 0.0 | 0.1 |
--------------------------------------------------------------------------------
| Net cash before financing activities | -21.3 | -2.8 | -14.1 |
--------------------------------------------------------------------------------
| Discontinued operations | | | |
--------------------------------------------------------------------------------
| Net cash from operating activities | 0.0 | 0.1 | 1.4 |
--------------------------------------------------------------------------------
| Net cash from investing activities | 9.2 | -0.4 | -0.8 |
--------------------------------------------------------------------------------
| Net cash before financing activities | 0.0 | -0.4 | -0.4 |
--------------------------------------------------------------------------------
| Cash flow from discontinued operations | 9.2 | -0.6 | 0.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Change in cash and cash equivalents | -4.7 | 2.2 | -6.6 |
--------------------------------------------------------------------------------
| Cash and cash equivalents at 31 | 13.8 | 20.4 | 20.4 |
| December | | | |
--------------------------------------------------------------------------------
| Foreign exchange adjustment | -0.1 | 0.0 | 0.0 |
--------------------------------------------------------------------------------
| Net change in cash and cash | -4.7 | 2.2 | -6.6 |
| equivalents | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents at 30 June | 9.0 | 22.6 | 13.8 |
--------------------------------------------------------------------------------
CHANGES IN EQUITY
--------------------------------------------------------------------------------
| EUR | Share | Share | Other | Treas | Reta | Attrib | Minorit | Total |
| million | capit | premi | reserv | ury | ined | utable | y | equity |
| | al | um | es | share | earn | to the | interes | |
| | | reser | | s | ings | share- | t | |
| | | ve | | | | holder | | |
| | | | | | | s of | | |
| | | | | | | the | | |
| | | | | | | parent | | |
--------------------------------------------------------------------------------
| Equity | 18.6 | 5.9 | -0.2 | -1.3 | 7.4 | 30.3 | 1.6 | 31.9 |
| at 1 | | | | | | | | |
| January | | | | | | | | |
| 2008 | | | | | | | | |
--------------------------------------------------------------------------------
| Change | | | -0.1 | | | -0.1 | | -0.1 |
| in | | | | | | | | |
| translat | | | | | | | | |
| ion | | | | | | | | |
| differen | | | | | | | | |
| ces | | | | | | | | |
--------------------------------------------------------------------------------
| Other | | | | | -0.1 | -0.1 | -0.1 | -0.2 |
| items | | | | | | | | |
--------------------------------------------------------------------------------
| Divestme | | | | | | | -1.3 | -1.3 |
| nt of | | | | | | | | |
| companie | | | | | | | | |
| s | | | | | | | | |
--------------------------------------------------------------------------------
| Profit | | | | | 4.3 | 4.3 | | 4.3 |
| for the | | | | | | | | |
| period | | | | | | | | |
--------------------------------------------------------------------------------
| Total | | | -0.1 | | 4.2 | 4.1 | -4.1 | 2.7 |
| recogniz | | | | | | | | |
| ed | | | | | | | | |
| income | | | | | | | | |
| and | | | | | | | | |
| expenses | | | | | | | | |
| for the | | | | | | | | |
| period | | | | | | | | |
--------------------------------------------------------------------------------
| Dividend | | | | | -8.8 | -8.8 | | -8.8 |
| s paid | | | | | | | | |
--------------------------------------------------------------------------------
| Purchase | | | | -1.5 | | -1.5 | | -1.5 |
| of | | | | | | | | |
| treasury | | | | | | | | |
| shares | | | | | | | | |
--------------------------------------------------------------------------------
| Sharebas | | | | | | | | |
| ed | | | | | | | | |
| payments | | | | | | | | |
--------------------------------------------------------------------------------
| Equity | 18.6 | 5.9 | -0.3 | -2.8 | 2.8 | 24.2 | 0.1 | 24.3 |
| at 30 | | | | | | | | |
| June | | | | | | | | |
| 2008 | | | | | | | | |
--------------------------------------------------------------------------------
| Equity | 18.6 | 5.9 | 0.5 | -1.3 | 6.7 | 30.5 | 1.7 | 32.2 |
| at 1 | | | | | | | | |
| January | | | | | | | | |
| 2007 | | | | | | | | |
--------------------------------------------------------------------------------
| Change | | | -0.4 | | -0.1 | -0.5 | | -0.5 |
| in | | | | | | | | |
| translat | | | | | | | | |
| ion | | | | | | | | |
| differen | | | | | | | | |
| ces | | | | | | | | |
--------------------------------------------------------------------------------
| Other | | | | | | | 0.1 | 0.1 |
| items | | | | | | | | |
--------------------------------------------------------------------------------
| Profit | | | | | 3.6 | 3.6 | 0.1 | 3.6 |
| for the | | | | | | | | |
| period | | | | | | | | |
--------------------------------------------------------------------------------
| Total | | | -0.4 | | 3.5 | 3.1 | 0.2 | 3.2 |
| recogniz | | | | | | | | |
| ed | | | | | | | | |
| income | | | | | | | | |
| and | | | | | | | | |
| expenses | | | | | | | | |
| for the | | | | | | | | |
| period | | | | | | | | |
--------------------------------------------------------------------------------
| Dividend | | | | | -7.9 | -7.9 | -0.3 | -8.2 |
| s paid | | | | | | | | |
--------------------------------------------------------------------------------
| Share- | | | | | 0.1 | 0.1 | | 0.1 |
| based | | | | | | | | |
| payments | | | | | | | | |
--------------------------------------------------------------------------------
| Equity | 18.6 | 5.9 | 0.1 | -1.3 | 2.4 | 25.7 | 1.6 | 27.3 |
| at 30 | | | | | | | | |
| June | | | | | | | | |
| 2007 | | | | | | | | |
--------------------------------------------------------------------------------
The change in the number of shares is detailed in the notes to the financial
statements.
NOTES TO THE FINANCIAL STATEMENTS
This interim report has been drawn up according to the IAS 34 Interim Financial
Reporting standard. In drawing up this interim report, Talentum has applied the
same accounting principles as in the financial statements for 2007 apart from
those described in the following paragraph.
In drawing up the interim report, the Group has recognized as an asset the costs
of developing the online business operations under intangible assets in
progress. The costs of project research have been recognized as an expense in
the income statement when they have materialized. Development expenditure has
been recognized as an asset when the asset has been considered to be technically
feasible and commercially exploitable, and it is expected to produce future
financial benefit. The economic useful life of intangible assets created from
development activities is two years. The main item in the development costs is
outsourcing.
As of 1 January 2008, Talentum has adopted the following new IFRIC
interpretations: IFRIC 11 Group and Treasury Share Transactions and IFRIC 14,
IAS 19 The Limit on a Defined Benefit Asset, Minimum Funding Requirements and
their Interaction. The adoption of the interpretations has had no effect on
Talentum's interim report. Other new interpretations are not relevant to the
Group.
All the figures in this report have been rounded up or down, so the sum of the
figures may be different from the totals shown.
TALENTUM GROUP BY BUSINESS AREA, CONTINUING OPERATIONS
--------------------------------------------------------------------------------
| EUR million | 4-6/ | 4-6/ | 1-6/ | 1-6/ | 1-12/ | 12 | 12 |
| | 2008 | 2007 | 2008 | 2007 | 2007 | months | months |
| | | | | | | rolling | rolling |
| | | | | | | 7/07-6/ | 7/06-6/ |
| | | | | | | 08 | 07 |
--------------------------------------------------------------------------------
| Net sales | | | | | | | |
--------------------------------------------------------------------------------
| Publishing | 24.4 | 20.6 | 47.5 | 41.5 | 83.8 | 89.8 | 78.9 |
--------------------------------------------------------------------------------
| Direct | 2.6 | 2.4 | 5.2 | 4.8 | 9.5 | 9.9 | 8.8 |
| marketing | | | | | | | |
--------------------------------------------------------------------------------
| Premedia | 1.5 | 3.9 | 3.8 | 8.0 | 12.5 | 8.3 | 15.9 |
--------------------------------------------------------------------------------
| Adjustments | -1.4 | -1.2 | -2.7 | -2.4 | -4.7 | -5.0 | -4.5 |
| and | | | | | | | |
| eliminations | | | | | | | |
--------------------------------------------------------------------------------
| Total | 27.1 | 25.6 | 53.8 | 51.9 | 101.2 | 103.1 | 99.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating | | | | | | | |
| profit | | | | | | | |
--------------------------------------------------------------------------------
| Publishing | 3.1 | 2.9 | 6.7 | 6.8 | 14.8 | 14.7 | 10.4 |
--------------------------------------------------------------------------------
| Direct | 0.2 | 0.3 | 0.6 | 0.7 | 1.3 | 1.3 | 1.2 |
| marketing | | | | | | | |
--------------------------------------------------------------------------------
| Premedia | 0.3 | -1.4 | 0.6 | -1.2 | -0.9 | 1.0 | -3.9 |
--------------------------------------------------------------------------------
| Adjustments | -0.8 | -0.8 | -1.7 | -1.3 | -2.5 | -2.9 | -2.4 |
| and | | | | | | | |
| eliminations | | | | | | | |
--------------------------------------------------------------------------------
| Total | 2.7 | 0.9 | 6.3 | 4.9 | 12.7 | 14.1 | 5.3 |
--------------------------------------------------------------------------------
GROUP COMPANIES SOLD IN THE PERIOD UNDER REVIEW
In February, the Group sold the Varesvuo Partners sub-group, which focused on TV
content production, except for the Group's shares in Oy Filmiteollisuus Fine Ab
and companies which it owns, which were sold in March. The Varesvuo Partners
sub-group has not been included in Talentum's consolidated figures for
January-March, except for Oy Filmiteollisuus Fine Ab's zero result. The Varesvuo
Partners sub-group was classed overall as discontinued operations in January.
The main areas of activity of the Varesvuo Partners companies are TV programme
production and advertising film production. The customers are TV channels and
advertising agencies. Talentum focuses on publishing targeted at professionals,
and TV programme production and advertising films are no longer seen to have any
synergy with the core operations.
Financial performance of discontinued operations
--------------------------------------------------------------------------------
| EUR million | 1-6/2008 | 1-6/2007 | 1-12/2007 |
--------------------------------------------------------------------------------
| Revenue | 1.1 | 11.8 | 24.1 |
--------------------------------------------------------------------------------
| Costs | -0.6 | -11.1 | -22.7 |
--------------------------------------------------------------------------------
| Taxes | -0.0 | -0.3 | -0.6 |
--------------------------------------------------------------------------------
| Profit after taxes | 0.4 | 0.4 | 0.8 |
--------------------------------------------------------------------------------
| Earnings per share, | 0.01 | 0.01 | 0.01 |
| discontinued operations | | | |
--------------------------------------------------------------------------------
The revenue in the period January-June 2008 includes the profit of EUR 0.8
million on the sale of the Varesvuo Partners sub-group and the loss of EUR 0.4
million caused by the sale of Oy Filmiteollisuus Fine Ab, which was separated
from the sub-group and sold separately in March.
Effect of sale of discontinued operations on the Group's financial position
--------------------------------------------------------------------------------
| EUR million | 30.6.2008 |
--------------------------------------------------------------------------------
| Property, plant and equipment | 3.3 |
--------------------------------------------------------------------------------
| Goodwill | 4.1 |
--------------------------------------------------------------------------------
| Other intangible assets | 0.3 |
--------------------------------------------------------------------------------
| Investments in associates | 1.6 |
--------------------------------------------------------------------------------
| Inventories | 3.0 |
--------------------------------------------------------------------------------
| Current receivables | 3.4 |
--------------------------------------------------------------------------------
| Cash and cash equivalents | 1.7 |
--------------------------------------------------------------------------------
| Minority interest | -1.3 |
--------------------------------------------------------------------------------
| Non-current liabilities | -0.3 |
--------------------------------------------------------------------------------
| Current liabilities | -5.3 |
--------------------------------------------------------------------------------
| Total assets and liabilities | 10.7 |
--------------------------------------------------------------------------------
| Total consideration | 11.1 |
--------------------------------------------------------------------------------
| Consideration received in cash | 11.1 |
--------------------------------------------------------------------------------
| Cash disposed of | 1.7 |
--------------------------------------------------------------------------------
| Net cash inflow | 9.2 |
--------------------------------------------------------------------------------
Effect of sale of shareholding in DH Tools Oy, Sata-Flexo Oy and Marvaco Oy on
the Group's financial position
In February, the Group also sold its entire shareholding in DH Tools Oy, which
was part of Premedia and focused on digital data management. DH Tools Oy's main
area of activity is supplying companies with digital systems for marketing. At
the time of sale, it was employing 16 people. In April, the Group sold its
entire shareholding in Sata-Flexo Oy and Marvaco Oy, which belonged to the
package printing material function of the Premedia business area. These
companies employed about 40 people at the time. The sales were part of the Group
withdrawal from operations unrelated to the core operations. The sales have not
had a material effect on the Group's financial performance or its financial
position.
--------------------------------------------------------------------------------
| EUR million | 30.6.2008 |
--------------------------------------------------------------------------------
| Property, plant and equipment | 0,7 |
--------------------------------------------------------------------------------
| Goodwill | 2,5 |
--------------------------------------------------------------------------------
| Other intangible assets | 0,1 |
--------------------------------------------------------------------------------
| Inventories | 0,2 |
--------------------------------------------------------------------------------
| Current receivables | 1,0 |
--------------------------------------------------------------------------------
| Cash and cash equivalents | 0,0 |
--------------------------------------------------------------------------------
| Current liabilities | -1,5 |
--------------------------------------------------------------------------------
| Total assets and liabilities | 3,1 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Consideration received in cash | 3,1 |
--------------------------------------------------------------------------------
| Cash disposed of | 0,0 |
--------------------------------------------------------------------------------
| Net cash inflow | 3,1 |
--------------------------------------------------------------------------------
CHANGE IN NUMBER OF SHARES
--------------------------------------------------------------------------------
| | 1-6/2008 | 1-6/2007 | 1-12/2007 |
--------------------------------------------------------------------------------
| 1,000 | | | |
--------------------------------------------------------------------------------
| Shares outstanding at | 44,040 | 44,040 | 44,040 |
| beginning of period | | | |
--------------------------------------------------------------------------------
| Share issue | 75 | - | - |
--------------------------------------------------------------------------------
| Acquisition of own shares | -500 | - | - |
--------------------------------------------------------------------------------
| Number of shares outstanding | 43,615 | 44,040 | 44,040 |
| at end of period | | | |
--------------------------------------------------------------------------------
The free-of-charge, directed share issue consists of the shares granted to the
company's management on the basis of Talentum Oyj's share-based incentive plan.
By virtue of the authorization granted, a total of 500,000 own shares were
acquired for the company by 30 June 2008 for use as consideration in possible
corporate acquisitions and other arrangements, including the possible
cancellation of shares. At the end of the period under review, the Group had in
its possession a total of 681,000 own shares.
The weighted average of the number of shares that was used for calculating the
earnings per share during the period under review is 43,957,217 (44,039,817 in
January-June 2007 and January-December 2007).
AVERAGE NUMBER OF STAFF, CONTINUING OPERATIONS
--------------------------------------------------------------------------------
| | 1-6/2008 | 1-6/2007 | 1-12/2007 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Publishing | 425 | 370 | 384 |
--------------------------------------------------------------------------------
| Direct marketing *) | 361 | 350 | 365 |
--------------------------------------------------------------------------------
| Premedia | 61 | 160 | 133 |
--------------------------------------------------------------------------------
| Group Administration | 15 | 12 | 14 |
--------------------------------------------------------------------------------
CONTINGENT LIABILITIES AND OTHER COMMITMENTS
--------------------------------------------------------------------------------
| EUR million | 30.6.2008 | 30.6.2007 | 31.12.2007 |
--------------------------------------------------------------------------------
| Financial institution loans | 2.3 | 2.8 | 3.7 |
--------------------------------------------------------------------------------
| Book value of shares pledged | 3.5 | 5.9 | 8.7 |
--------------------------------------------------------------------------------
| Mortgaged real estates | 0.4 | 0.4 | 0.4 |
--------------------------------------------------------------------------------
CHANGE IN PROPERTY, PLANT AND EQUIPMENT
--------------------------------------------------------------------------------
| EUR million | 1-6/2008 | 1-6/2007 | 1-12/2007 |
--------------------------------------------------------------------------------
| Carrying value at start of period | 6.6 | 7.9 | 7.9 |
--------------------------------------------------------------------------------
| Additions | 0.3 | 0.8 | 1.5 |
--------------------------------------------------------------------------------
| Disposals through disposals of | -4.3 | | -0.4 |
| subsidiaries | | | |
--------------------------------------------------------------------------------
| Disposals/transfers | 0.0 | -0.4 | 0.0 |
--------------------------------------------------------------------------------
| Depreciation for the period | -0.6 | -1.3 | -2.5 |
--------------------------------------------------------------------------------
| Carrying value at end of period | 2.0 | 7.0 | 6.6 |
--------------------------------------------------------------------------------
RELATED PARTIES TRANSACTIONS
--------------------------------------------------------------------------------
| EUR million | 30.6.2008 | 30.6.2007 | 31.12.2007 |
--------------------------------------------------------------------------------
| Management employee benefits | 0.6 | 0.7 | 2.0 |
--------------------------------------------------------------------------------
| Support payments to pension fund | 3.5 | 1.8 | 4.3 |
--------------------------------------------------------------------------------
| Associates and joint ventures: | | | |
--------------------------------------------------------------------------------
| Sales | 0.0 | 0.1 | 0.2 |
--------------------------------------------------------------------------------
| Purchases | 0.0 | 0.3 | 0.5 |
--------------------------------------------------------------------------------
| Current receivables | 0.0 | 0.0 | 0.1 |
--------------------------------------------------------------------------------
| Current liabilities | 0.6 | 0.5 | 0.5 |
--------------------------------------------------------------------------------
Calculation of key indicators
Earnings per share, EUR = Profit for the period attributable to equity holders /
Adjusted average number of shares at the end of the period
Equity per share, EUR = Equity attributable to the equity shareholders /
Adjusted average number of shares at the end of the period
Equity ratio, % = Total equity / Balance sheet total - advances received x100
Gearing, % = Interest-bearing debts - cash and cash equivalents / Total equity
x100
Market capitalization = Number of shares at the end of the period x Trading
price at the end of the period
The figures in this release are unaudited.
The forecasts and estimates presented here are based on the management's view of
developments in the economy at this present moment, and the actual results may
differ substantially from what the company now expects.
In 2008, Talentum will be publishing the interim report for January-September on
28 October.
TALENTUM OYJ
Juha Blomster
CEO
FURTHER INFORMATION
Juha Blomster, CEO, tel +358 40 342 4444
Kaisa Kokkonen, CFO, tel +358 40 342 4212
www.talentum.fi
COPIES TO
OMX Nordic Exchange Helsinki
Key media
BRIEFING
A briefing will be held for analysts and the media today, 23 July 2008 at 10.00
at the Talentum head office, Annankatu 34-36 B, Kamppi, Helsinki. The financial
performance will be presented by CEO Juha Blomster and CFO Kaisa Kokkonen.
Talentum Oyj
Annankatu 34 - 36 B
00100 Helsinki
Finland
Tel + 358 20 442 40
www.talentum.com
