In the 2(nd) quarter of 2021, the revenue of AS Ekspress Grupp totalled EUR
17.9 million and the revenue for the first six months of the year totalled EUR
33.2 million. The Group's net profit for the 2(nd) quarter of 2021 was EUR 1.25
million and the net profit for the first 6 months of the year was EUR 0.98
million. At the end of June, the share of the Group's digital revenue was 53% of
total revenue and 75% of media segment revenue.
In the 2(nd) quarter of 2021, the consolidated revenue totalled EUR 17.9 million
(2(nd) quarter 2020: EUR 13.9 million), increasing by 28%. The revenue growth is
attributable to the online advertising market which has recovered well and has
gained momentum on account of other types of media, demonstrating good growth in
all Baltic States. Print advertising revenue continues to be under pressure and
it has still not regained its pre-pandemic level. The consolidated revenue for
the first six months of 2021 was EUR 33.2 million, increasing by 12% year-over-
year.
The number of the digital subscriptions of AS Ekspress Grupp increased by 76% by
the end of June 2021 as compared to the same period last year and was more than
110 thousand subscriptions. The addition of digital subscribers will have a
positive impact on the results of operations of Ekspress Grupp and is a proof of
the viability of its long-term strategic direction.
The earnings before interest, tax, depreciation and amortisation (EBITDA) of
Ekspress Grupp totalled EUR 2.67 million in the 2(nd) quarter which on EUR 1.01
million or 61% higher as compared to the 2(nd) quarter of 2020. Strong sales of
online advertising and digital subscriptions in all Baltic States and continued
cost reduction have helped improve profitability. The effects of the ongoing
pandemic in the 2(nd) quarter have not turned out to be of the same magnitude as
in the 2(nd) quarter of 2020 when advertising sales received a major setback.
Upon enforcement of national restrictions, the economy did not suffer similarly
to 2020 but the restrictions enforced due to the pandemic still had an effect on
outdoor advertising and ticket sales companies in the 2(nd) quarter of 2021. The
advertising customers have adapted to the circumstances and the growth of the
advertising business in all countries demonstrates that the majority of
companies have been able to digitalise their business more; they have opened or
adapted their ways of trading to e-channels and the need to advertise has
recovered. Considering the availability of vaccines and the desire of people to
move around and attend events, we are more optimistic about the recovery of the
outdoor advertising and ticket sales business.
In the 2(nd) quarter, the consolidated net profit totalled EUR 1.25 million
which is 114% more than in the same period in 2020. The net profit for the first
six months totalled EUR 0.98 million which is EUR 1.14 million higher than in
the same period last year.
A key event for the Group in the 2(nd) quarter was the receiving of the purchase
offer for AS Printall from the company Trükitung OÜ, which is owned by Group's
majority shareholder Hans Luik. Since the end of last year, the Group had
considered various strategic alternatives for the printing services segment,
including the sale of printing services, sale and leaseback of real estate
properties and potential mergers. In July 2021, the shareholders approved this
transaction and authorised the Management Board of AS Ekspress Grupp to complete
the transaction which is planned to be finalised during the 3(rd) quarter. The
outcome of the transaction will be the Group's exit from the business with
significant CAPEX requirements that is not in line with the Group's strategy.
Availability of new capital will provide additional capacity for the Group to
fund the digital area.
In the 2(nd) quarter, the group company D Screens won a tender in Latvia
relating to the right to lease the real estate properties in the ownership of
the City of Riga. The lease agreement covers 91 advertising spaces owned by the
City of Riga in excellent locations, the majority of which will be digitalised
by the company. The investments in digital outdoor screens that are related to
the new region will be completed at the end of 2022. The agreement will increase
the network of the Group's digital screens, which covers the key roads of the
City of Riga, more than 100 properties.
The new Estonian ticket sales platform Piletitasku
(https://www.piletitasku.ee/et/) that had been launched at the beginning of the
2(nd) quarter gained momentum once the state of emergency was lifted and it has
been well received by the event organisers and ticket buyers. We offer a fresh
and convenient buying experience for ticket buyers and technologically a new
level for organisers. We strive to make the entry and management of events and
monitoring of reports and data as comprehensive as possible. The ticket sales
platform is a good example of a digital business with a clear synergy with
digital media that fits the strategy of the Group's current complementing
digital businesses.
Despite the pandemic, a conference Login (https://login.lt/) on the topic of
digital development was organised in Lithuania which lasted for 5 days and was
available as a streaming in all the largest media portals of Lithuania. The
interest of both participants and advertising customers was high. The largest
digital conference of Lithuania acquired in 2019 is performing in line with the
set goals.
As at 30 June 2021, the Group's available cash is in the amount of EUR 4.2
million (30 June 2020: EUR 6.3 million). The Group's liquidity is good, but in
order to strengthen the Group's liquidity position and flexibility as well as to
increase the working capital, the Group signed amendments to the loan agreements
with AS SEB Pank in July 2021. The maturity dates of loans were extended by 5
years and monthly payments were reduced from EUR 0.2 million to EUR 0.06 million
per month. As a result of the amendments, Ekspress Grupp will have another EUR
1.7 million available to strengthen the Group's current key activities and
increase investments in its digital businesses.
Q2 AND 6 MONTHS RESULTS
REVENUE
The consolidated revenue for the 2(nd) quarter of 2021 totalled EUR 17.9 million
(2(nd) quarter 2020: EUR 13.9 million). Revenue increased by 28% year-over-year
in the 2(nd) quarter. Advertising revenue has demonstrated a strong recovery.
The consolidated revenue for the first six months of 2021 totalled EUR 33.2
million (first six months of 2020: EUR 29.6 million). At the end of 2(nd)
quarter of 2021, the share of the Group's digital revenue accounted for 53% of
total revenue and 75% of media segment revenue (at the end of 2(nd) quarter
2020: 46% of total revenue and 68% media segment revenue, respectively). Digital
revenue increased by 30% as compared to the same period last year.
PROFITABILITY
In the 2(nd) quarter of 2021, the consolidated EBITDA totalled EUR 2.67 million
(2(nd) quarter 2020: EUR 1.65 million). In the 2(nd) quarter of 2021, EBITDA
increased by 61% as compared to the previous year and the EBITDA margin was
14.9% (2(nd) quarter 2020: 11.9%). Strong sales of online advertising, digital
subscriptions and tight cost controls in all Baltic States have helped to
improve profitability. The consolidated EBITDA for the first six months of 2021
totalled EUR 3.76 million (first six months of 2020: EUR 2.33 million).
In the 2(nd) quarter of 2021, the consolidated net profit totalled EUR 1.25
million (2(nd) quarter 2020: EUR 0.58 million), which is EUR 0.67 million and
114% better as compared to 2020. The consolidated net profit for the first six
months of 2021 totalled EUR 0.98 million (first six months of 2020 net loss: EUR
-0.16 million), which is EUR 1.14 million and 714% better as compared to 2020.
CASH POSITION
At the end of the reporting period, the Group had available cash in the amount
of EUR 4.2 million and equity in the amount of EUR 55.4 million (59% of total
assets). The comparable data as of 30 June 2020 were EUR 6.3 million and EUR
51.5 million (54% of total assets), respectively. As of 30 June 2021, the
Group's net debt was EUR 17.9 million (30 June 2020: EUR 16.3 million).
The cash position in 2020 was impacted by the agreements concluded with the
banks due to the COVID-19 related state of emergency. An agreement was concluded
with AS SEB Pank to suspend loan payments in the period March-August 2020 (EUR
1.2 million) and with AS Citadele banka in the period of June-November 2020 (EUR
0.3 million). The salary subsidy received from the Estonian Unemployment
Insurance Fund (EUR 1.14 million) and the postponement of the payment of tax
arrears (EUR 1.60 million) due to the state of emergency for the period of 24
months had an additional positive impact on the Group's cash position last year.
Key financial indicators for segments
(EUR thousand) Sales
12 months
Q2 2021 Q2 2020 Change % 6M 2021 6M 2020 Change % 2020
Media segment 12 904 9 891 30% 23 560 19 917 18% 43 728
incl.
revenue from all
digital and
online
channels 9 939 7 021 42% 17 603 13 526 30% 30 963
% of revenue
from all digital
and
online
channels 77% 71% 75% 68% 71%
Printing services
segment 5 255 4 569 15% 10 163 10 813 -6% 21 384
Corporate
functions 1 054 520 103% 2 106 1 035 103% 2 761
Inter-segment
eliminations (1 322) (1 037) (2 648) (2 118) (4 629)
TOTAL GROUP 17 890 13 944 28% 33 181 29 646 12% 63 243
% of revenue
from all digital
and
online
channels 56% 50% 53% 46% 49%
(EUR thousand) EBITDA
12 months
Q2 2021 Q2 2020 Change % 6M 2021 6M 2020 Change % 2020
Media segment 2 281 1 514 51% 3 076 1 762 75% 6 601
Printing services
segment 529 248 113% 1 022 831 23% 2 224
Corporate
functions (111) (92) -20% (289) (236) -23% (720)
Inter-segment
eliminations* (34) (16) (53) (33) (1 101)
TOTAL GROUP 2 666 1 654 61% 3 755 2 325 62% 7 004
* Due to continuing impact of COVID-19 on economical situation the group has
recognised an impairment loss for property, plant and equipment in amount of EUR
1.0 million in the 4(th) quarter 2020.
EBITDA margin Q2 2021 Q2 2020 6M 2021 6M 2020 12 months 2020
Media segment 18% 15% 13% 9% 15%
Printing services segment 10% 5% 10% 8% 10%
TOTAL GROUP 15% 12% 11% 8% 11%
Consolidated balance sheet (unaudited)
(EUR thousand) 30.06.2021 31.12.2020
-------------------------------------------------------------------------------
ASSETS
-------------------------------------------------------------------------------
Current assets
-------------------------------------------------------------------------------
Cash and cash equivalents 4 207 6 269
-------------------------------------------------------------------------------
Trade and other receivables 11 369 9 450
-------------------------------------------------------------------------------
Corporate income tax prepayment 153 7
-------------------------------------------------------------------------------
Inventories 2 596 2 756
-------------------------------------------------------------------------------
Total current assets 18 325 18 482
-------------------------------------------------------------------------------
Non-current assets
-------------------------------------------------------------------------------
Other receivables and investments 948 982
-------------------------------------------------------------------------------
Deferred tax asset 30 30
-------------------------------------------------------------------------------
Investments in joint ventures 898 1 661
-------------------------------------------------------------------------------
Investments in associates 2 336 2 253
-------------------------------------------------------------------------------
Property, plant and equipment 15 014 14 134
-------------------------------------------------------------------------------
Intangible assets 56 766 56 635
-------------------------------------------------------------------------------
Total non-current assets 75 992 75 696
-------------------------------------------------------------------------------
TOTAL ASSETS 94 316 94 177
-------------------------------------------------------------------------------
LIABILITIES
-------------------------------------------------------------------------------
Current liabilities
-------------------------------------------------------------------------------
Borrowings 3 421 3 613
-------------------------------------------------------------------------------
Trade and other payables 14 721 15 251
-------------------------------------------------------------------------------
Corporate income tax payable 53 81
-------------------------------------------------------------------------------
Total current liabilities 18 196 18 945
-------------------------------------------------------------------------------
Non-current liabilities
-------------------------------------------------------------------------------
Long-term borrowings 18 652 18 589
-------------------------------------------------------------------------------
Other long-term liabilities 2 040 2 025
-------------------------------------------------------------------------------
Total non-current liabilities 20 692 20 613
-------------------------------------------------------------------------------
TOTAL LIABILITIES 38 888 39 558
-------------------------------------------------------------------------------
EQUITY
-------------------------------------------------------------------------------
Minority interest 128 126
-------------------------------------------------------------------------------
Capital and reserves attributable to equity holders of
parent company:
-------------------------------------------------------------------------------
Share capital 18 478 18 478
-------------------------------------------------------------------------------
Share premium 14 277 14 277
-------------------------------------------------------------------------------
Treasury shares (384) (209)
-------------------------------------------------------------------------------
Reserves 1 903 1 758
-------------------------------------------------------------------------------
Retained earnings 21 026 20 189
-------------------------------------------------------------------------------
Total capital and reserves attributable to equity
holders of parent company 55 300 54 493
-------------------------------------------------------------------------------
TOTAL EQUITY 55 428 54 619
-------------------------------------------------------------------------------
TOTAL LIABILITIES AND EQUITY 94 316 94 177
-------------------------------------------------------------------------------
Consolidated statement of comprehensive income (unaudited)
(EUR thousand) Q2 2021 Q2 2020 6M 2021 6M 2020 12 months 2020
-------------------------------------------------------------------------------
Sales 17 890 13 944 33 181 29 646 63 243
-------------------------------------------------------------------------------
Cost of sales (13 763) (11 598) (26 509) (25 070) (50 637)
-------------------------------------------------------------------------------
Gross profit 4 128 2 346 6 671 4 576 12 607
-------------------------------------------------------------------------------
Other income 212 521 319 605 2 040
-------------------------------------------------------------------------------
Marketing expenses (892) (531) (1 488) (1 288) (2 701)
-------------------------------------------------------------------------------
Administrative expenses (1 898) (1 602) (3 923) (3 495) (7 532)
-------------------------------------------------------------------------------
Other expenses (29) (56) (55) (80) (1 336)
-------------------------------------------------------------------------------
Operating profit /(loss) 1 521 678 1 524 319 3 078
-------------------------------------------------------------------------------
Interest income 8 6 17 12 28
-------------------------------------------------------------------------------
Interest expenses (202) (217) (412) (441) (877)
-------------------------------------------------------------------------------
Other finance
income/(costs) (15) (12) (4) (28) 614
-------------------------------------------------------------------------------
Net finance cost (209) (223) (400) (457) (235)
-------------------------------------------------------------------------------
Profit/(loss) on shares of
joint ventures (63) 135 (170) 8 102
-------------------------------------------------------------------------------
Profit/(loss) on shares of
associates 32 (8) 67 (28) (129)
-------------------------------------------------------------------------------
Profit /(loss) before
income tax 1 281 582 1 021 (158) 2 816
-------------------------------------------------------------------------------
Income tax expense (34) (1) (39) (2) (280)
-------------------------------------------------------------------------------
Net profit /(loss) for the
reporting period 1 247 582 982 (160) 2 536
-------------------------------------------------------------------------------
Net profit /(loss) for the
reporting period
attributable to
-------------------------------------------------------------------------------
Equity holders of the
parent company 1 246 575 980 (168) 2 510
-------------------------------------------------------------------------------
Minority interest 1 7 2 8 26
-------------------------------------------------------------------------------
Total comprehensive income
/(loss) 1 247 582 982 (160) 2 536
-------------------------------------------------------------------------------
Comprehensive income
/(loss) for the reporting
period attributable to
-------------------------------------------------------------------------------
Equity holders of the
parent company 1 246 575 980 (168) 2 510
-------------------------------------------------------------------------------
Minority interest 1 7 2 8 26
-------------------------------------------------------------------------------
Basic earnings per share 0.04 0.02 0.03 (0.01) 0.08
-------------------------------------------------------------------------------
Diluted earnings per share 0.04 0.02 0.03 (0.01) 0.08
-------------------------------------------------------------------------------
Consolidated cash flow statement (unaudited)
(EUR thousand) 6M 2021 6M 2020 12 months 2020
-------------------------------------------------------------------------------
Cash flows from operating activities
-------------------------------------------------------------------------------
Operating profit for the reporting year 1 524 319 3 078
-------------------------------------------------------------------------------
Adjustments for:
-------------------------------------------------------------------------------
Depreciation and amortisation 2 281 2 011 3 968
-------------------------------------------------------------------------------
(Gain)/loss on sale, write-down and impairment
of property, plant and equipment 36 (3) 986
-------------------------------------------------------------------------------
Change in value of share option 19 0 0
-------------------------------------------------------------------------------
Cash flows from operating activities:
-------------------------------------------------------------------------------
Trade and other receivables (1 150) 2 470 3 274
-------------------------------------------------------------------------------
Inventories 160 68 375
-------------------------------------------------------------------------------
Trade and other payables (390) 1 515 (1 201)
-------------------------------------------------------------------------------
Cash generated from operations 2 481 6 379 10 480
-------------------------------------------------------------------------------
Income tax paid (212) (56) (263)
-------------------------------------------------------------------------------
Interest paid (277) (306) (903)
-------------------------------------------------------------------------------
Net cash generated from operating activities 1 992 6 017 9 314
-------------------------------------------------------------------------------
Cash flows from investing activities
-------------------------------------------------------------------------------
Acquisition of subsidiaries/ associates (less
cash acquired) and
other investments / cash paid-in equity-
accounted investees (201) (203) (425)
-------------------------------------------------------------------------------
Receipts of other investments 51 0 16
-------------------------------------------------------------------------------
Interest received 2 1 2
-------------------------------------------------------------------------------
Purchase of property, plant and equipment
and intangible assets (1 268) (1 037) (2 562)
-------------------------------------------------------------------------------
Proceeds from sale of property, plant and
equipment
and intangible assets 1 29 308
-------------------------------------------------------------------------------
Loans granted (82) (98) (331)
-------------------------------------------------------------------------------
Dividends received 78 150 150
-------------------------------------------------------------------------------
Net cash used in investing activities (1 419) (1 158) (2 841)
-------------------------------------------------------------------------------
Cash flows from financing activities
-------------------------------------------------------------------------------
Payment of lease liabilities (954) (519) (949)
-------------------------------------------------------------------------------
Change in overdraft 0 (1 018) (1 018)
-------------------------------------------------------------------------------
Loans received / Repayments of bank loans (1 235) (662) (1 884)
-------------------------------------------------------------------------------
Proceeds from share issuance 0 0 600
-------------------------------------------------------------------------------
Purchases of treasury shares (446) 0 (600)
-------------------------------------------------------------------------------
Net cash used in financing activities (2 635) (2 200) (3 851)
-------------------------------------------------------------------------------
NET (DECREASE)/INCREASE IN CASH AND CASH
EQUIVALENTS (2 062) 2 659 2 621
-------------------------------------------------------------------------------
Cash and cash equivalents at the beginning of
the period 6 269 3 647 3 647
-------------------------------------------------------------------------------
Cash and cash equivalents at the end of the
period 4 207 6 306 6 269
-------------------------------------------------------------------------------
Signe Kukin
Group CFO
AS Ekspress Grupp
Phone: +372 669 8381
E-mail: signe.kukin@egrupp.ee (mailto:signe.kukin@egrupp.ee)
AS Ekspress Grupp is the leading media group in the Baltic States whose key
activities include web media content production, publishing of newspapers and
magazines and provision of printing services in Estonia, Latvia and Lithuania.
The Group also manages the electronic ticket sales platform and ticket sales
sites in Latvia. Ekspress Grupp that launched its operations in 1989 employs
almost 1600 people, owns leading web media portals in the Baltic States and
publishes the most popular daily and weekly newspapers as well as the majority
of the most popular magazines in Estonia.
|