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Edited Transcript of SAA1V.HE earnings conference call or presentation 25-Oct-19 8:00am GMT

Q3 2019 Sanoma Oyj Earnings Call

Helsinki Oct 28, 2019 (Thomson StreetEvents) -- Edited Transcript of Sanoma Oyj earnings conference call or presentation Friday, October 25, 2019 at 8:00:00am GMT

TEXT version of Transcript

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Corporate Participants

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* Kaisa Uurasmaa

Sanoma Oyj - Head of IR & Corporate Social Responsibility

* Markus Holm

Sanoma Oyj - CFO & COO

* Susan Duinhoven

Sanoma Oyj - President & CEO

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Conference Call Participants

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* Pete-Veikko Kujala

SEB, Research Division - Equity Analyst

* Petri Aho

Inderes Oy - Partner & Analyst

* Sami Sarkamies

Nordea Markets, Research Division - Senior Analyst of TMT

* Jarno Hartikainen

Helsingin Sanomat - Media

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Presentation

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Kaisa Uurasmaa, Sanoma Oyj - Head of IR & Corporate Social Responsibility [1]

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Good morning, ladies and gentlemen. I would like to welcome you to Sanoma's Third Quarter 2019 Interim Report Presentation. My name is Kaisa Uurasmaa. I'm heading Investor Relations at Sanoma. This event will be recorded, and it can be viewed live on our website and then as a recording after the event.

After the presentation, we will have a Q&A session. We will first take questions from here at Sanomatalo. Please wait for the microphone. And then after the questions from here, we will hand over to the telephone line.

With this short introduction, I will now hand over to the first speaker, Susan Duinhoven, our President and CEO, who will be followed by Markus Holm, CFO. Please, Susan.

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Susan Duinhoven, Sanoma Oyj - President & CEO [2]

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Thank you, Kaisa. Good morning, and welcome also from my end. Q3 was a solid quarter for Sanoma, and if we look at the first 9 months, operational EBIT was stable, and the margin improved. If we then look at the highlights, and we look at first 9 months as a whole, then we see that net sales declined slightly, but sales were stable in both Learning and Media Finland, and the decline came out of the Media Netherlands, and that's specifically due to the divestments done earlier in the year.

The comparable net sales development of the group as a whole, is minus 3%, and that is in line with last year's trend. The operational EBIT, excluding PPA, landed on EUR 184 million and was in line with previous year's level, and therefore, the margin improved. The free cash flow is positively impacted by IFRS 16 and that explains a big part of the increase. The leverage increased to 2.8; and 0.9 was -- of that was a result of the Iddink acquisition, and 0.4 was due to IFRS 16 implementation. And as you've noticed, when we closed the deal on Iddink, we also improved our outlook for the full year 2019, and we indicated that the EBIT margin, excluding PPA, improved to above 15%, and we did that on September 13 at closing.

But then let's give a bit of an overview as always on the different businesses and how the earnings developed. And again, I do this for the first 9 months because, as you know, our Learning business has quite a cyclicality, so that avoids any shifts between the quarters. Earnings significantly improved in the Learning business and grew in line with both net sales, and we also see some benefits of the High Five program coming through, as well as an improvement in the business mix.

In Media Finland, a solid -- solid earnings, stable net sales. And Media Netherlands, there, as indicated before, divestments resulted in a lower reported net sales and followed, of course, also by operational EBIT. The operational EBIT was also impacted by the comparable net sales decline, and we'll explain a bit later in the details of the SBU where that came from. The other operations, you'll see a decrease in cost. That is specifically our head office and our infrastructure technology costs that are reported there. So overall, a solid performance over the first 9 months.

In Learning, I stay at the first 9 months, you see net sales at the same level. The growth in Belgium and in Poland due to slight curriculum changes, so the major curriculum changes are still to take place in the coming years, but this was a slower start of that. In the Netherlands, a stable year. And in Finland, slightly lower because there, the curriculum changes ended in 2018. In Finland, you also see that the digital learning methods start representing a larger part of the revenues. And that means that that revenue is more equally spread across the year. And that, of course, then impact the peak, let's say, that you normally see in Q2 and Q3.

The operational EBIT, excluding PPA, improved to EUR 85 million. The benefits from the High Five program showing and also the more favorable business mix in Poland. And there, you remember, we have both the distribution business and the publishing business, and it means that in a more favorable business mix, we sell more of our own product and less third party product.

As said, the acquisition of Iddink, we're very pleased to be able to complete that on September 13, and it will be reported as part of the Learning strategic business unit from 1st of October, 2019, onwards. So that means, in these results, you do not yet see any results from Iddink. That will only come into Q4. But when you look at the graph, I think you see a very good trend and now resulting in a 12-month rolling EBIT of 21.5% for the overall Learning business.

So with that, going to Finland. And Finland is, of course, impacted always by the advertising market. So as usual, we give you a bit of an insight in that in the reported figures, you see that if you look at the year as a whole, 2019 year-to-date, that the market is actually quite stable. But in the quarter, the decrease was 2%, and that is actually quite usual. You see that Q2 was the exception, and that was due to the elections that created more advertising market than we normally have in Finland.

You see that if you look at third quarter, the newspaper and magazine print advertising decreasing, radio and online strongly increasing; and the one exception in TV, where it's decreasing there. The Sanoma result was actually quite a bit more positive from a trend line perspective due to an increased share. So overall, we see the normal trends, the print slightly decreasing, the increase in radio, online and TV, sometimes a bit better than other quarters.

It's important to realize that if you look at the Finnish advertising as a total within the group, that is less than 20% of the overall group revenues. And within that, the print is only 1/4 of that. And so, it gives you a bit of a feel for how to scale these trends.

If we then look at Media Finland unit. We saw, just like in the previous quarters, that specifically the digital part of the business, both the subscription and the advertising was growing very nicely, and profitability overall improved. We see that, in total, net sales declined a bit, a little bit of shift, specifically on the events business that grew in the first 9 months, but declined in the third quarter. But if we look at the digital subscriptions, specifically Ruutu Plus, Helsingin Sanomat, again, growth in the quarter. And with that, you see that the decline in subscription sales in print, which is typically around the magazine business is almost compensated by the increase in digital subscription revenues.

Advertising sales was also almost stable, where the good development in digital, and specifically also in video around our Ilta-Sanomat news site, made that the decrease in print was almost fully compensated. Single copy sales also increased this quarter due to an additional issue, which is always with the weeklies, you can sometimes have a quarter with one more issue and the decline in VAT that improved the net sales. And as I already said, the net sales in events declined in the third quarter, but overall, over the year, increased with events. We have, of course, a little bit of seasonal business now also included in our Finnish business.

If you then look at the operational EBIT, that is at previous year level and the margin, therefore, improved. Improved profitability in the events, the revisiting of the portfolio after last year led to an increased profitability there. And you'll also see that the decrease in print leads to lower paper and distribution costs.

In the organization of Sanoma Media Finland, we made a change from the 1st of October onwards and integrated a number of the news brands and the magazine brands. And that was, let's say, building on the success that we've had with [Tiedotteet], which was always already closely integrated into Helsingin Sanomat, and where sharing of the digital content really improves the proposition. And we see that that works both for Ilta-Sanomat and for Helsingin Sanomat, it's in their own fields. So therefore, combining this really makes sharing of this unique and high-quality content possible for both subscribers and advertisers.

So overall, you see an improved profitability. Third quarter at 15.3%, which we see as very solid for a media business.

If we then go to the Netherlands, there, we saw -- just like we saw in the last quarter that the divestments have an impact on the net sales, and net sales declined in the quarter to EUR 87 million; and EUR 14 million of that decline was due to the divestments. And just to remind you, the divestments, we sold the LINDA magazine. We sold the Head Office content marketing operations in Belgium. And we discontinued the Home Deco e-commerce operations, not the business, but the operations, the execution of it is outsourced. We see that, of course, now impacting -- in the third quarter, you will see specifically also that e-commerce operation impacting, of course, also the fourth quarter.

NU.nl, again, had a very good quarter with double-digit growth, which made the digital advertising in the Netherlands grow significantly. The sales -- cash back service Scoupy had lower sales, and that was due to the earlier in the year, restructuring of the portfolio where we only maintained and focused on the more profitable product lines. Circulation sales continue to be impacted by that 1st of January VAT increase in the Netherlands. As you remember from the earlier quarters, the VAT increase limited our pricing capabilities and that, of course, plays through the whole of the year, so you will see that coming back also in the last quarter as one of these trends.

In the Netherlands, the number of issues published overall was lower impacted -- impacting both the circulation and the advertising sales. Earnings declined largely due to the divestments and, of course, the lower comparable net sales, but also we had a little bit of extra spending in NU.nl and Tijdschrift.nl. And Tijdschrift.nl, you can translate that as magazine.nl, which is our all-you-can-eat online platform for subscriptions on all magazines, not only our own, but also third-party magazines, and that proposition is nicely taking off. Of course, still small numbers, but already showing quite an attractive growth.

And therefore, both in NU and Tijdschrift.nl we invest a bit in the technology behind it -- user interface; and specifically on NU.nl, also in content. For example, with the launch of junior new -- so news for kids. So that explains the results in the Netherlands, where you see that over the quarters, the profitability is good, but there is quite some swing between the quarters. Q2, very strong in margin; and Q3, a bit lower.

We will then go to the outlook for 2019, we improved that as indicated on September 13, outlook is still the same. We expect comparable net sales to be in line with 2018, and operational EBIT margin, excluding PPA, to be above 15%, and the comparable figure for last year was 15.7%. As always, the outlook, of course, assumes that there is nothing exceptional happening in the fourth quarter on the consumer confidence or the advertising market development. And it's good to realize that this is, therefore, an outlook that also includes the Iddink fourth quarter results.

Now with that, I would like to hand over to Markus to give a bit more details on the financials.

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Markus Holm, Sanoma Oyj - CFO & COO [3]

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Thank you. I will start as usual with overview of the third quarter operational earnings. In Learning, here you see positives in the quarter. We had a more favorable business mix in Poland and with a lower share of the distribution sales, where net sales growth in Poland and Belgium, mainly and the benefits of the High Five program continued in the quarter. These were then slightly offset by higher amortizations due to investments in technology and Learning. The positive effect for Learning was EUR 3.4 million compared to prior year.

Media Finland, we had improved profitability in the events business that was now into second year. We saw some positive effects of lower paper distribution and marketing costs then somewhat offset by TV program amortizations that increased due to timing differences mainly versus prior year. Media Finland overall versus prior year, flat.

Media Netherlands, negatives mainly here. The biggest one, the divestments that we did this year; then also lower comparable net sales; and the additional spending in NU.nl and Tijdschrift.nl and lower marketing personnel and other fixed cost expenses in quarter 3 of prior year, so that changes a bit the comparison.

Looking on the cash flow. We're on a good level. And according to our expectations, the year-to-date free cash flow improved to EUR 56 million compared to EUR 40 million a year ago. That, however, includes EUR 18 million of the IFRS 16 leasing standard, and we have a EUR 10 million impact of the rental contract settlement in Belgium, as we have disclosed earlier in the year. Also, costs related to changes in IT infrastructure, what we call journey to cloud program, which has been quite big in the year for Sanoma.

Looking on the debt -- net debt, we have now the Iddink acquisition that has increased our net debt to EUR 798 million, and net debt to EBITDA to 2.8. Equity ratio at 33.8%; and now the EUR 250 million 4-year term loan that we signed in February that was drawn now in September to finance the acquisitions of -- acquisition of Iddink. And in total, the acquisition of Iddink and the IFRS 16 impact, they were 0.9 and 0.4, respectively. In the graph here, you can see that we are now somewhat above the long-term target of 2.5, but we see that in a year's time, roughly, we will be back on our target level.

The EUR 200 million eurobond, we will repay in November. This will be replaced with more flexible debt instruments, i.e., bank financing and commercial paper, where we are active in the market. We expect this to significantly reduce our financial expenses going forward. The year-to-date net financial expenses, you can see our net financial items were EUR 18 million compared to EUR 14 million a year ago, and this includes EUR 5 million from IFRS 16. Our average interest rate was slightly higher at 2.7% compared to prior year, only because of the higher proportion of the bond in the mix.

And on 4th of November, we will pay the second dividend installment of EUR 0.20, and the record date is now on the coming Monday, 28th of October, and with those, we have then completed the total dividend of EUR 0.45 per share. And the payout ratio, as we calculate it, we exclude the one-off cost related to Belgian women's magazine portfolio, and that is then within our range of 40% to 60% payout.

With this, I hand over to Kaisa for some closing remarks. Thank you.

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Kaisa Uurasmaa, Sanoma Oyj - Head of IR & Corporate Social Responsibility [4]

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Yes. Thank you, Markus. Thank you, Susan. We are planning to host an Analyst and Investor Day in the end of December. So 18th of December is to -- for you to pencil in your calendars. In the event, Susan and Markus will elaborate a bit more on our Learning business and its financials after the acquisition of Iddink, and invitations to this event will be sent later in November. And then we will be reporting the full year results in -- on 7th of February next year.

And with this, I conclude the presentation. And now the floor is open for questions from here at Sanomatalo. And please wait for the microphone. We have the first question here.

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Questions and Answers

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Sami Sarkamies, Nordea Markets, Research Division - Senior Analyst of TMT [1]

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Sami Sarkamies from Nordea Markets. I have a couple of questions. Starting from next year, this year is starting to be in the back already. What's your current thinking regarding operating environment and your spending plans going into next year?

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Susan Duinhoven, Sanoma Oyj - President & CEO [2]

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I think we're not yet at the stage that the year is done. We're still very hard working on Q4. But we think that, in general speaking, the economic environment is probably not going to improve compared to this year, so that is what we're taking in into our thinking. At the same time, it is uncertain how that will exactly impact. So we're prudent in that sense. But at the same time, I'm also a believer that we shouldn't be overly negative upfront because I think there are always opportunities; and the other companies, specifically with their advertising, will also be needing to look for growth. So I think there are opportunities there, but it is fair to say that the environment, as for everyone, is not expected to improve.

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Sami Sarkamies, Nordea Markets, Research Division - Senior Analyst of TMT [3]

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Okay. And then moving back to Q3. On Media Finland, just wanted to check as you had higher TV amortizations in the third quarter due to timing differences. Have you had lower amortizations in the first half of the year? Or will that be the case in Q4?

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Markus Holm, Sanoma Oyj - CFO & COO [4]

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It is just a shift between the quarters. There's some minor, not that significant really.

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Sami Sarkamies, Nordea Markets, Research Division - Senior Analyst of TMT [5]

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Okay. And then on the Iddink acquisition, would it be possible to go through the impact on PPAs that we will see going forward? So what will be the sort of full impact on your PPAs going forward?

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Markus Holm, Sanoma Oyj - CFO & COO [6]

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That is a bit too early to say because we are now with the auditors, we are reviewing the PPAs and the allocation of goodwill and all of that. That is happening in the fourth quarter. So that we will hopefully be able to elaborate more on in the coming sessions.

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Sami Sarkamies, Nordea Markets, Research Division - Senior Analyst of TMT [7]

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Anything you can say at this point.

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Markus Holm, Sanoma Oyj - CFO & COO [8]

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Nothing more than what we disclosed already regarding Iddink, so I think that already reflects the existing PPAs that we have in the business.

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Sami Sarkamies, Nordea Markets, Research Division - Senior Analyst of TMT [9]

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Okay. And then finally, on the domestic Media business, you decided recently to divest some of the e-commerce assets. Could you open up your thinking behind that? I guess, you could have sort of continued to invest and develop those services on your own as well.

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Susan Duinhoven, Sanoma Oyj - President & CEO [10]

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Yes, these were smaller services. And there, there is a belief on our end that there is a minimum scale that is needed in order to do that profitable. As you know that general classified is not an area that is very lucrative anywhere in the world. And specifically, when you then do that on a very small scale, it's very hard to make that profitable.

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Kaisa Uurasmaa, Sanoma Oyj - Head of IR & Corporate Social Responsibility [11]

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More questions, please.

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Jarno Hartikainen, Helsingin Sanomat - Media [12]

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Jarno Hartikainen, Helsingin Sanomat. I'd like to ask about the recent decision to decrease the VAT for digital newspapers and magazine single -- the magazines and the digital newspapers. What kind of effect -- from your presentation, I see that you didn't mention the decision at all, but did you have any kind of effect on the profitability of Media business in Finland. And looking to the future, how do you aim to distribute the benefits from that decision? I mean, what portion of the benefits will go to consumers at lower prices? What will go to the newsrooms in greater resources? And what portion of that will go to the owners as increased profitability?

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Susan Duinhoven, Sanoma Oyj - President & CEO [13]

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I think we disclosed that last quarter when we discussed it in more detail because this is, of course, something that was a topic at that point in time, and what we have indicated is that we have done additional investments in data journalism. For example, in Helsingin Sanomat as use of that increased availability of funds. In the single copy sales, we see that the strong decrease in single copy in general, increases the cost base. So there, the VAT reduction very much supports the continued availability in a broad scale in all the markets. So that's how that is used, and there will probably also be something going to the profitability of that.

But that is a minor, I think the whole intention behind this and why we were also quite positive, as we indicated before, is that now the VAT is equal. And that, I think, is quite important from overall running of the business, because otherwise, you have a strange preference for printed or digital, depending on the VAT pressure. So I think it is an important part, whatever the level is, that it is equal between digital and print.

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Kaisa Uurasmaa, Sanoma Oyj - Head of IR & Corporate Social Responsibility [14]

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Thank you. Next question here, please?

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Unidentified Analyst [15]

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Yes, (inaudible). I have one further question on Media Netherlands. Could you elaborate what was the impact of the lower publishing volumes on your comparable net sales during the quarter? You had a number of issues.

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Susan Duinhoven, Sanoma Oyj - President & CEO [16]

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Yes.

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Unidentified Analyst [17]

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It was lower, so what was the impact on the comparable net sales?

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Susan Duinhoven, Sanoma Oyj - President & CEO [18]

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Yes, that -- we have not split that for the different measures, but that is something that we can make available.

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Kaisa Uurasmaa, Sanoma Oyj - Head of IR & Corporate Social Responsibility [19]

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Thank you. Next, please?

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Pete-Veikko Kujala, SEB, Research Division - Equity Analyst [20]

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Pete-Veikko Kujala from SEB. First about the events business or the festivals business in Finland. Are you now satisfied, if we look at Q2 and Q3, are you satisfied with the profitability of the business? Because I remember last year, you had some issues, especially in Q3.

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Susan Duinhoven, Sanoma Oyj - President & CEO [21]

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Yes, I think we're very happy with that business. It's clearly a business -- you need to constantly work with the portfolio. So you will see still movements in that portfolio, some acquisitions, some divestments. The market changes, the competitive situation changes, but we're very happy with that business. We saw good results coming out of it.

And it's now, of course, a business that is also more integrated into Sanoma. If you remember, last year, we acquired that business just before the summer. And the peak is, of course, in the summer period. So there, we were more, I would almost say, riding the wave than really steering. And this now has given us a full year to prepare, and it has shown its results, both on the top line and on the bottom line.

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Pete-Veikko Kujala, SEB, Research Division - Equity Analyst [22]

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And so there -- it's like a calendar effect if we look at Q2 and Q3?

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Susan Duinhoven, Sanoma Oyj - President & CEO [23]

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Yes.

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Pete-Veikko Kujala, SEB, Research Division - Equity Analyst [24]

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Yes.

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Susan Duinhoven, Sanoma Oyj - President & CEO [25]

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So it's just sort of which events are when and what's the organization? So unfortunately, where you're very used to us to these sort of stories from the Learning business, we have now introduced this into the SMF business as well.

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Pete-Veikko Kujala, SEB, Research Division - Equity Analyst [26]

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Okay. Super. All right. Still in Media Finland, can you open up a little bit? What was the effect of the Fox TV sales in Q3?

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Susan Duinhoven, Sanoma Oyj - President & CEO [27]

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Yes, it was positive, and I can't say much more about that. And that has also its origin in how we sell, because we sell total packages of audiences, and that goes across all channels. And therefore, it is very hard to say this part is allocated to that; and what the effect therefore is of having Fox, yes or no, and that is a bit of an artificial split. We can, of course, see what is published, let's say, what is shown on one channel, but not what the effect of the channel is, so we will not disclose individual sales figures, but overall, we were very happy with the TV development in the third quarter.

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Pete-Veikko Kujala, SEB, Research Division - Equity Analyst [28]

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All right. And then one more. Actually, 2 more. Could you give some indication about how the Q3 was for Iddink, the business that's not consolidated yet?

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Susan Duinhoven, Sanoma Oyj - President & CEO [29]

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No.

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Markus Holm, Sanoma Oyj - CFO & COO [30]

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No. We haven't disclosed that. So we have disclosed until the second half. And now we're doing the closing balance sheet for Iddink now, and it will be consolidated from 1st of October onwards. So that's when we start publishing.

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Pete-Veikko Kujala, SEB, Research Division - Equity Analyst [31]

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Yes, all right. And then continuing in Learning. When you gave out your new guidance, you mentioned that Iddink was a driver in the upgrade. Maybe I'm just confused, but this would have to imply that the margin profitability in Q4 for Iddink is very much higher than last year because I remember, in 2018, it was something like 6%.

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Susan Duinhoven, Sanoma Oyj - President & CEO [32]

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Yes. So it is a couple of million higher, the profitability, but we will sort of come back to that when we're reporting on the fourth quarter.

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Kaisa Uurasmaa, Sanoma Oyj - Head of IR & Corporate Social Responsibility [33]

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And more questions here, please.

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Petri Aho, Inderes Oy - Partner & Analyst [34]

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Petri Aho, Inderes. If you talk about Media Netherlands, it has had a very big variation in operational EBIT margin. Can you discuss a little bit more about that? And will it continue going forward?

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Susan Duinhoven, Sanoma Oyj - President & CEO [35]

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Yes. There is, of course, always a bit of fluctuation, and you see that also in the previous year. The fluctuation is a bit more this year, and we had that discussion also a bit in Q1, Q2. And I think that's where you see most of the shift because of Easter. And Easter just being in Q2 or just being in Q1 makes then quite a bit of a difference. So I think if you look back at the Q1, Q2 results, you'll see that those average out. This quarter was truly impacted by both the divestments, the Scoupy sales, and I think also a little bit often -- over last year, there was a bit of a quarter effect between the quarters that make the comparable quite high. And that is the cost for both marketing and personnel was quite a bit lower then.

So it is a bit of a coincidence, I would say, that all these effects now come together in this third quarter, and that's why it makes it look a bit, like I said, if you look at the underlying business and if you look at our expectations of that business, we're quite happy. And so we're not -- we don't see in our business, when we look at underneath the drivers, we see quite solid performance. I mean, the VAT increase in 1st of January was a disappointment for the whole of the market, but those are the things that happened.

That is the only thing that has impacted, for example, the circulation sales in a negative way. The trends there are good. The business is performing well. Teams are good on the creative side, coming up also with interesting new concepts for the magazines. So overall, we're quite happy with that business. But I'm with you; it is a bit of a wild ride this year, but I think that in -- when we report the full year, you'll see that dampen out.

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Markus Holm, Sanoma Oyj - CFO & COO [36]

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Yes, quarter 2 more plus is quarter 3 more minuses. You have to look on the year-to-date overall which is quite in line with our expectations. And so the divestment absolutely the biggest change in the prior year.

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Petri Aho, Inderes Oy - Partner & Analyst [37]

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Yes. Can you then talk about more of these effects of divestments to Q2 -- Q3 results in Netherlands? So you said that net sales effect was EUR 14 million, but what kind of margin had divested part?

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Markus Holm, Sanoma Oyj - CFO & COO [38]

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Overall, you can -- we have, each quarter, disclosed the effect of the sales of the divestments. And in -- on a year-to-date basis, it's somewhat over [EUR 14 million], if I remember correctly. And you can take an average profitability more or less on that. So it is mainly the move from magazines, the LINDA magazine, which was a good profitable magazine.

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Kaisa Uurasmaa, Sanoma Oyj - Head of IR & Corporate Social Responsibility [39]

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Thank you. Any further questions from Sanomatalo? If not, I will now hand over to the operator for questions from the telephone line, please.

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Operator [40]

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(Operator Instructions) We have one first question from [Arno Avinicki]. Sir, please go ahead.

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Unidentified Analyst [41]

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I still have a couple of questions on the Netherlands. What would be the underlying comparable trends in [Tiedotteet] revenues in Q3 and year-to-date, if you exclude those divestments?

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Susan Duinhoven, Sanoma Oyj - President & CEO [42]

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As we indicated in the slide, it's minus 5% is the comparable sales, excluding the divestments.

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Unidentified Analyst [43]

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Yes. But then you give this detail of print, non-print and other. So I was wondering, how would it look on a comparable basis for those lines and if print...

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Susan Duinhoven, Sanoma Oyj - President & CEO [44]

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Yes. We do not disclose that.

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Unidentified Analyst [45]

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All right. And then on Netherlands, still, what is the size of this NU.nl and Scoupy business in terms of revenues. How big [are these] of the total Netherlands and what is the margin compared to the rest of the business?

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Susan Duinhoven, Sanoma Oyj - President & CEO [46]

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Yes. We typically do not disclose on a brand-by-brand basis, the revenues, the -- both of them are, of course, smaller properties. NU.nl is comparable with other titles, let's say, as an overall revenue. So I think you should not look at this as half of the business or something, but we will not disclose the details. Both of them are reported within the digital part of the business.

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Markus Holm, Sanoma Oyj - CFO & COO [47]

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News and data overall, as we said in the road show presentation, it's roughly 10% of the sales in Holland.

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Susan Duinhoven, Sanoma Oyj - President & CEO [48]

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But that's the total of it.

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Markus Holm, Sanoma Oyj - CFO & COO [49]

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Yes. Total.

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Unidentified Analyst [50]

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All right. And my final question is on the guidance. So you expect comparable net sales to be in line with last year, but the 9 months were down 3%. So what kind of expectation do you have for Q4? And what kind of range do you have if it will be in line?

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Susan Duinhoven, Sanoma Oyj - President & CEO [51]

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Yes, we leave that math a little bit to you. We don't forecast, let's say, the quarters; but typically, in the media businesses, the fourth quarter is a heavy quarter. And so that's the -- it weighs quite heavily on the overall results.

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Unidentified Analyst [52]

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But do I understand it correctly that you are guiding flat organic sales for the full year, and this means quite a hockey stick for Q4? And then kind of what would be driving that if we see then advertising is coming down and there kind of underlying trends are similar as they have been.

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Susan Duinhoven, Sanoma Oyj - President & CEO [53]

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Yes. But I think -- I understand your question. I think when we see in line with prior year, it doesn't mean to be on the euro exactly identical. So there is quite a range around that that we normally keep. And so stable is -- for us, there is a bit of a plus or minus around that.

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Operator [54]

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Thank you, sir. (Operator Instructions) We have no other questions by phone.

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Kaisa Uurasmaa, Sanoma Oyj - Head of IR & Corporate Social Responsibility [55]

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Okay. Thank you. With this, I conclude the presentation, and thank you for actively participating. And if any further questions, please be in contact with us at IR. Thank you.

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Susan Duinhoven, Sanoma Oyj - President & CEO [56]

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Thank you.