Market announcement

Title

AS Ekspress Grupp: Consolidated unaudited interim report for the Fourth Quarter and 12 Months of 2021

Message

In  the 4(th) quarter  of 2021, the  revenue of  AS Ekspress  Grupp increased by
18%, totalling  EUR 15.9 million  and 12-month  revenue increased  by 20% to EUR
53.5 million.  The Group's net profit for the 4(th) quarter of 2021 was EUR 2.3
million  and 12-month net  profit was EUR  4.1 million. At the  end of December,
digital  revenue made up 76% of the  Group's total revenue. In coordination with
the  Supervisory Board,  the Management  Board proposes  to pay dividends to the
shareholders in the amount of 5-euro cents per share.

The  Group's performance in  the fourth quarter  was strong as  expected. In the
4(th) quarter  of 2021, the consolidated revenue reached EUR 15.9 million (4(th)
quarter  2020: EUR 13.5 million), increasing by  18% as compared to the previous
year.  Revenue growth  is attributable  to the  active online advertising market
which  continued to grow as compared to traditional media outlets. In the 4(th)
quarter,  the online  advertising market  in the  Baltics increased by more than
20% year-over-year.   Advertising   customers   have  adapted  to  the  economic
circumstances  and  the  growth  of  the  advertising  business in all countries
demonstrates  that the majority of companies  have been able to digitalise their
businesses  more;  they  have  opened  or  adapted  their  ways of trading to e-
channels.  Thus,  they  need  increasingly  more  flexible  digital  advertising
solutions which major news portals are able to provide well.

The number of the digital subscriptions of AS Ekspress Grupp increased by 62% by
the  end of December 2021 as  compared to the same  period last year and reached
135 thousand  subscriptions. As compared to the  previous quarter, the growth in
digital  subscriptions was  8% or 9 662 subscriptions  in the 4(th) quarter. The
Latvian  and  Lithuanian  media  outlets  demonstrated the strongest growth. The
growth  of  digital  subscriptions  is  as  expected  while additional growth is
primarily   attributable  to  new  customers,  demonstrating  that  the  Group's
periodicals  address increasingly more those readers who until now have not been
subscribers.   In addition,  the Group  has managed  to keep its current digital
subscribers,  lowering  the  share  of  digital  subscription  cancellations and
increasing the average life of digital subscriptions. We are witnessing a decent
potential for further growth in Latvia and Lithuania.

The  earnings before  interest, tax,  depreciation and  amortisation (EBITDA) of
Ekspress Grupp totalled EUR 3.2 million in the 4(th) quarter and EUR 8.2 million
for  the 12-month period which is  14% and 39%, respectively, higher as compared
to  the  same  period  in  2020. Strong  sales of online advertising and digital
subscriptions  in all  Baltic States  and continued  cost reductions have helped
improve  profitability. The Group's net profit in the 4(th) quarter totalled EUR
2.3 million  which is 1% higher than in the  same period last year. The 12-month
net profit totalled EUR 4.13 million which is 61% higher than in the same period
last  year  (12  months  2020: EUR  2.57 million).  The net profit of the 4(th)
quarter  of 2021 was  impacted by  recognition of  one-off finance income in the
amount  of EUR  0.4 million for  fair value  adjustment of the future commitment
related the purchase price of the ticket sales platform (4(th) quarter 2020: EUR
0.7 million).  During the 12 months of 2021, the  Group received a one-off state
subsidy  in the amount of EUR 0.41 million in Latvia to offset the effect of the
COVID-19 pandemic. Its purpose was to support the activities of the ticket sales
platform  at a time when event organisation during a 7-month period was limited.
In  2020, one-off  COVID-19 pandemic-related  state  subsidies totalled EUR 0.9
million in Estonia and Latvia.

At the end of the 4(th) quarter, the Group acquired a 100% ownership interest in
Geenius  Meedia  OÜ  which  is  a  modern  media  company with 13 online portals
(geenius.ee  (https://geenius.ee/)), a podcast and  print magazines. The purpose
of the acquisition is to grow and expand the digital media business into a niche
that  has not yet been  regularly covered by the  periodicals of Ekspress Grupp.
The  Group  of  Ekspress  Grupp  creates  a  synergy  for  Geenius Meedia in the
functions  promoting the media  business which gives  a greater growth potential
for  a fast-growing company.  The joint objective  of Ekspress Grupp and Geenius
Meedia is to provide captivating content for its readers in technology, business
and automotive segments.

The  Group's liquidity is  excellent.  As of  31 December 2021, the Group's cash
and  cash equivalents totalled EUR 11 million (31.12.2020: EUR 6.3 million). The
strong  cash balance at the year-end was  impacted by the proceeds in the amount
of  EUR 6.3 million from the  sale of the printing  house Printall in the 3(rd)
quarter. The Group used this cash to make an extraordinary dividend distribution
of  10 euro cents per  share (a total  of EUR 3.03 million)  in 4(th) quarter of
2021.

In coordination with the Supervisory Board, the Management Board proposes to pay
dividends  from the net profit of the 2021 financial year to the shareholders in
the  amount of 5 euro cents per share,  in the total amount of EUR 1.51 million,
resulting  in  a  dividend  rate  of  37% (calculated  on  the  net  profit from
continuing  operations). In  autumn 2021, the  Supervisory Board  of AS Ekspress
Grupp approved the Group's dividend policy pursuant to which Ekspress Grupp will
pay at least 30% of its annual profit as dividends starting from 2022.

Q4 AND 12 MONTHS RESULTS

In  accordance  with  the  decision  of  the  extraordinary  general  meeting of
shareholders  of AS Ekspress  Grupp from 13 July  2021, AS Ekspress Grupp and OÜ
Trükitung  concluded a sales  agreement on 3 September  2021, according to which
Ekspress  Grupp sold its 100% ownership interest  in its subsidiary Printall AS.
The  transaction  was  completed  as  of  6 September  2021. In the consolidated
interim  report for the 4(th) quarter and  12 months of 2021, the information is
presented  about  continuing  operations  where  the  revenue  and  expenses  of
discontinued operations are shown in a separate line in the comprehensive income
statement  "Gain/-loss  from  discontinued  operations".  Until  the  sale,  the
business  of Printall AS was recognised  as a separate printing services segment
which  the Group discloses  as a discontinued  operation in this  report. In the
comprehensive  income statement of the interim  report and the segment overview,
the  comparative  information  of  continuing  operations  has been restated. No
restatements  have been made to the consolidated balance sheet and cash flows in
accordance  with the requirements  of IFRS. The  assets of the printing services
segment  continue to be consolidated line-by-line in the balance sheet as of 31
December 2020, because Printall AS did not meet the criteria to be classified as
held for sale as of 31 December 2020.

REVENUE

In   the   4(th) quarter  of  2021, the  consolidated  revenue  from  continuing
operations  totalled  EUR  15.9 million  (4(th) quarter 2020: EUR 13.5 million).
Revenue  increased by 18% year-over-year in  the 4(th) quarter. Both advertising
as well as digital subscription revenue increased. The consolidated revenue from
continuing  operations for the  twelve months of  2021 totalled EUR 53.5 million
(12  months of  2020: EUR 44.5 million).  At the  end of  2021, the share of the
Group's  digital  revenue  accounted  for  76% of  total  revenue (at the end of
2020: 70% of total revenue). Digital revenue increased by 31% as compared to the
same period last year.

PROFITABILITY

In  the 4(th) quarter of 2021, the  consolidated EBITDA of continuing operations
totalled   EUR   3.19 million   (4(th)   quarter  2020: EUR  2.80 million).  The
consolidated  EBITDA of  continuing operations  for the  twelve months  of 2021
totalled EUR 8.24 million (12 months of 2020: EUR 5.92 million). In 2021, EBITDA
increased  by 39% as  compared to  the previous  year and  the EBITDA margin was
15.4% (2020:  13.3%). Strong sales of  online advertising, digital subscriptions
and   tight   cost  controls  in  all  Baltic  States  have  helped  to  improve
profitability.  During the 12 months of 2021, the Group received a one-off state
subsidy  in Latvia in the amount of EUR 0.41 million related to the ticket sales
platform  where events had been cancelled  during the period of almost 7 months.
In  2020, one-off  COVID-19 pandemic-related  state  subsidies totalled EUR 0.9
million in Estonia and Latvia.

In  the  4(th) quarter  of  2021, the  consolidated  net  profit from continuing
operations  totalled  EUR  2.31 million  (4(th) quarter 2020: EUR 2.28 million),
which  is EUR 0.03 million  and 1% higher as  compared to 2020. The consolidated
net profit from continuing operations for the twelve months of 2021 totalled EUR
4.13 million  (12 months of  2020: EUR 2.57 million), which  is EUR 1.57 million
and  61% better as  compared to  2020. The net  profit for  the 4(th) quarter of
2021 was  impacted by one-off  finance income for  fair value adjustment of the
outstanding  commitment related the purchase price  of the ticket sales platform
in the amount of EUR 0.4 million (4(th) quarter 2020: EUR 0.7 million).

CASH POSITION

At  the end of the reporting period, the  Group had available cash in the amount
of  EUR 11.0 million and equity in the  amount of EUR 53.7 million (57% of total
assets).  The  comparable  data  as  of 31 December 2020, including the printing
services  segment,  were  EUR  6.3 million  and  EUR  54.6 million (58% of total
assets),  respectively. As  of 31 December  2021, the Group's  net debt  was EUR
11.3 million  (31 December 2020: EUR 15.9 million).  As of 31 December 2021, the
cash  position was positively impacted by net cash proceeds from the sale of the
ownership  interest  in  Printall  AS  in  the  amount of EUR 6.3 million (incl.
premature  payment of the outstanding loan balance of Printall AS to AS SEB Pank
under  the  loan  contract  in  the  amount  of EUR 2.06 million, see Note 8) in
September.  Proceeds  have  been  partially  used for the extraordinary dividend
payment  (3.03 million euros) and  for the acquisition of  Geenius Meedia in the
last quarter.

DIVIDENDS AND DIVIDEND POLICY

In  conjunction with the sale  of Printall AS, the  group paid the extraordinary
dividends  of 10 euro cents per share in the total amount of EUR 3.03 million in
November 2021.

The  Management Board proposes to pay dividends from the net profit of the 2021
financial  year to the shareholders in the  amount of 5 euro cents per share, in
the  total amount  of EUR  1.51 million, resulting  in a  dividend rate  of 37%
(calculated  on the net profit from continuing operations) and dividend yield of
3.2%.

The  Supervisory Board of  AS Ekspress Grupp  has approved the group's dividends
policy,  according to which Ekspress  Grupp will pay at  least 30% of the annual
profit as dividends starting from 2022.



Key financial indicators for segments (continuing operations)

 (EUR thousand)     Sales

                                             12 months    12 months
                    Q4 2021 Q4 2020 Change % 2021         2020         Change %

 Media segment      15 608  13 061  20%      52 093       43 728       19%

      incl. revenue
 from all digital
 and online
 channels           12 610  9 625   31%      40 453       30 963       31%

      % of revenue
 from all digital
 and online
 channels           81%     74%              78%          71%

 Corporate
 functions          1 013   1 032   -2%      4 118        2 761        49%

 Inter-segment
 eliminations       (677)   (558)            (2 695)      (1 975)

 TOTAL GROUP        15 943  13 535  18%      53 516       44 514       20%

      % of revenue
 from all digital
 and online
 channels           79%     71%              76%          70%



 (EUR thousand)     EBITDA

                                             12 months    12 months
                    Q4 2021 Q4 2020 Change % 2021         2020         Change %

 Media segment      3 449   3 110   11%      8 927        6 601        35%

 Corporate
 functions          (245)   (394)   38%      (669)        (720)        7%

 Inter-segment
 eliminations       (15)    86               (18)         43

 TOTAL GROUP        3 189   2 802   14%      8 240        5 924        39%



  EBITDA margin   Q4 2021   Q4 2020   12 months 2021   12 months 2020

  Media segment   22%       24%       17%              15%

  TOTAL GROUP     20%       21%       15%              13%



Consolidated balance sheet (unaudited)

 (EUR thousand)                                           31.12.2021 31.12.2020
-------------------------------------------------------------------------------
 ASSETS
-------------------------------------------------------------------------------
 Current assets
-------------------------------------------------------------------------------
 Cash and cash equivalents                                    10 962      6 269
-------------------------------------------------------------------------------
 Trade and other receivables                                   9 323      9 450
-------------------------------------------------------------------------------
 Corporate income tax prepayment                                   2          7
-------------------------------------------------------------------------------
 Inventories                                                     266      2 756
-------------------------------------------------------------------------------
 Total current assets                                         20 553     18 482
-------------------------------------------------------------------------------
 Non-current assets
-------------------------------------------------------------------------------
 Other receivables and investments                             1 671        982
-------------------------------------------------------------------------------
 Deferred tax asset                                               42         30
-------------------------------------------------------------------------------
 Investments in joint ventures                                 1 011      1 661
-------------------------------------------------------------------------------
 Investments in associates                                     2 210      2 253
-------------------------------------------------------------------------------
 Property, plant and equipment                                 7 964     14 134
-------------------------------------------------------------------------------
 Intangible assets                                            60 807     56 635
-------------------------------------------------------------------------------
 Total non-current assets                                     73 705     75 695
-------------------------------------------------------------------------------
 TOTAL ASSETS                                                 94 258     94 177
-------------------------------------------------------------------------------
 LIABILITIES
-------------------------------------------------------------------------------
 Current liabilities
-------------------------------------------------------------------------------
 Borrowings                                                    3 201      3 613
-------------------------------------------------------------------------------
 Trade and other payables                                     17 664     15 251
-------------------------------------------------------------------------------
 Corporate income tax payable                                     82         81
-------------------------------------------------------------------------------
 Total current liabilities                                    20 947     18 945
-------------------------------------------------------------------------------
 Non-current liabilities
-------------------------------------------------------------------------------
 Long-term borrowings                                         19 018     18 589
-------------------------------------------------------------------------------
 Other long-term liabilities                                     601      2 024
-------------------------------------------------------------------------------
 Total non-current liabilities                                19 619     20 613
-------------------------------------------------------------------------------
 TOTAL LIABILITIES                                            40 566     39 558
-------------------------------------------------------------------------------
 EQUITY
-------------------------------------------------------------------------------
 Minority interest                                               140        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                                                      1 920      1 758
-------------------------------------------------------------------------------
 Retained earnings                                            19 261     20 189
-------------------------------------------------------------------------------
 Total capital and reserves attributable to equity
 holders of parent company                                    53 552     54 493
-------------------------------------------------------------------------------
 TOTAL EQUITY                                                 53 692     54 619
-------------------------------------------------------------------------------
 TOTAL LIABILITIES AND EQUITY                                 94 258     94 177
-------------------------------------------------------------------------------



Consolidated statement of comprehensive income (unaudited)

 (EUR thousand)                   Q4 2021 Q4 2020 12 months 2021 12 months 2020
-------------------------------------------------------------------------------
 Continuing operations
-------------------------------------------------------------------------------
 Sales                             15 943  13 535         53 516         44 514
-------------------------------------------------------------------------------
 Cost of sales                   (11 132) (9 139)       (39 674)       (34 013)
-------------------------------------------------------------------------------
 Gross profit                       4 811   4 396         13 842         10 501
-------------------------------------------------------------------------------
 Other income                         320     654            929          1 691
-------------------------------------------------------------------------------
 Marketing expenses                 (766)   (529)        (2 359)        (1 905)
-------------------------------------------------------------------------------
 Administrative expenses          (2 013) (2 212)        (7 435)        (6 930)
-------------------------------------------------------------------------------
 Other expenses                      (51)   (198)          (113)          (286)
-------------------------------------------------------------------------------
 Operating profit /(loss)           2 301   2 112          4 864          3 071
-------------------------------------------------------------------------------
 Interest income                        9       9             35             28
-------------------------------------------------------------------------------
 Interest expenses                  (172)   (188)          (709)          (860)
-------------------------------------------------------------------------------
 Other finance income/(costs)         401     680            339            634
-------------------------------------------------------------------------------
 Net finance cost                     239     501          (335)          (198)
-------------------------------------------------------------------------------
 Profit/(loss) on shares of
 joint ventures                     (153)     (5)          (281)            102
-------------------------------------------------------------------------------
 Profit/(loss) on shares of
 associates                            78    (54)            161          (129)
-------------------------------------------------------------------------------
 Profit /(loss) before income
 tax                                2 465   2 554          4 409          2 846
-------------------------------------------------------------------------------
 Income tax expense                 (156)   (277)          (276)          (280)
-------------------------------------------------------------------------------
 Net profit from continuing
 operations                         2 310   2 277          4 133          2 566
-------------------------------------------------------------------------------
 Net profit /(loss) from
 discontinued operation                 0   (663)        (1 876)           (30)
-------------------------------------------------------------------------------
 Net profit /(loss) for the
 reporting period                   2 310   1 614          2 257          2 536
-------------------------------------------------------------------------------
 Net profit /(loss) for the reporting period
 attributable to
-------------------------------------------------------------------------------
 Equity holders of the parent
 company                            2 300   1 603          2 243          2 510
-------------------------------------------------------------------------------
 Minority interest                     10      11             14             26
-------------------------------------------------------------------------------
 Total comprehensive income
 /(loss)                            2 310   1 614          2 257          2 536
-------------------------------------------------------------------------------
 Comprehensive income /(loss) for the reporting period
 attributable to
-------------------------------------------------------------------------------
 Equity holders of the parent
 company                            2 300   1 603          2 243          2 510
-------------------------------------------------------------------------------
 Minority interest                     10      11             14             26
-------------------------------------------------------------------------------
 Earnings per share (euro) -
 continuing operations
-------------------------------------------------------------------------------
 Basic earnings per share            0.08    0.08           0.14           0.09
-------------------------------------------------------------------------------
 Diluted earnings per share          0.07    0.07           0.13           0.08
-------------------------------------------------------------------------------
 Earnings per share (euro)
-------------------------------------------------------------------------------
 Basic earnings per share            0.08    0.05           0.07           0.08
-------------------------------------------------------------------------------
 Diluted earnings per share          0.07    0.05           0.07           0.08
-------------------------------------------------------------------------------



Consolidated cash flow statement (unaudited)

                                                            12 months 12 months
 (EUR thousand)                                                  2021      2020
-------------------------------------------------------------------------------
 Cash flows from operating activities
-------------------------------------------------------------------------------
 Operating profit for the reporting year                        3 060     3 078
-------------------------------------------------------------------------------
 Adjustments for (non-cash):
-------------------------------------------------------------------------------
 Depreciation and amortisation                                  4 162     3 968
-------------------------------------------------------------------------------
 (Gain)/loss on sale, write-down and impairment of
 property, plant and equipment                                   (10)       986
-------------------------------------------------------------------------------
 Change in value of share option                                   36         0
-------------------------------------------------------------------------------
 Loss on sale of discontinued operation                         2 077         0
-------------------------------------------------------------------------------
 Cash flows from operating activities:
-------------------------------------------------------------------------------
 Trade and other receivables                                  (1 599)     3 274
-------------------------------------------------------------------------------
 Inventories                                                     (33)       375
-------------------------------------------------------------------------------
 Trade and other payables                                       1 464   (1 201)
-------------------------------------------------------------------------------
 Cash generated from operations                                 9 157    10 480
-------------------------------------------------------------------------------
 Income tax paid                                                (281)     (263)
-------------------------------------------------------------------------------
 Interest paid                                                  (803)     (903)
-------------------------------------------------------------------------------
 Net cash generated from operating activities                   8 073     9 314
-------------------------------------------------------------------------------
 Cash flows from investing activities
-------------------------------------------------------------------------------
 Acquisition of subsidiaries/ associates (less cash
 acquired) and other investments /
 cash paid-in equity-accounted investees                      (3 325)     (425)
-------------------------------------------------------------------------------
 Disposal of discontinued operation, net of cash disposed
 of                                                             6 326         0
-------------------------------------------------------------------------------
 Receipts of other investments                                     51        16
-------------------------------------------------------------------------------
 Interest received                                                  3         2
-------------------------------------------------------------------------------
 Purchase of property, plant and equipment
 and intangible assets                                        (2 786)   (2 561)
-------------------------------------------------------------------------------
 Proceeds from sale of property, plant and equipment
 and intangible assets                                              3       308
-------------------------------------------------------------------------------
 Loans granted                                                  (212)     (331)
-------------------------------------------------------------------------------
 Loan repayments received                                         156         0
-------------------------------------------------------------------------------
 Dividends received                                               828       150
-------------------------------------------------------------------------------
 Net cash used in investing activities                          1 044   (2 841)
-------------------------------------------------------------------------------
 Cash flows from financing activities
-------------------------------------------------------------------------------
 Dividends paid                                               (3 028)         0
-------------------------------------------------------------------------------
 Payment of lease liabilities                                 (1 814)     (949)
-------------------------------------------------------------------------------
 Change in overdraft                                                0   (1 018)
-------------------------------------------------------------------------------
 Loans received / Repayments of bank loans                        864   (1 884)
-------------------------------------------------------------------------------
 Proceeds from share issuance                                       0       600
-------------------------------------------------------------------------------
 Purchases of treasury shares                                   (446)     (600)
-------------------------------------------------------------------------------
 Net cash used in financing activities                        (4 424)   (3 851)
-------------------------------------------------------------------------------
 NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS           4 693     2 622
-------------------------------------------------------------------------------
 Cash and cash equivalents at the beginning of the period       6 269     3 647
-------------------------------------------------------------------------------
 Cash and cash equivalents at the end of the period            10 962     6 269
-------------------------------------------------------------------------------



Signe Kukin
Group CFO
AS Ekspress Grupp
Telephone: +372 669 8381
E-mail address: [email protected] (mailto:[email protected])



AS  Ekspress Grupp  is the  leading media  group in  the Baltic States whose key
activities  include web media  content production and  publishing of newspapers,
magazines and books. The Group also manages the electronic ticket sales platform
and  ticket sales sites in Estonia and  Latvia. Ekspress Grupp that launched its
operations in 1989 employs more than 1400 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.