NZZ Media Group records growth in user market

Growth in the user market The establishment of CH Media enables the NZZ Media Group to combine forces and thereby focus even more strongly on its core business. The change has a significant impact on the 2018 financial statements of NZZ Media Group and makes comparability with the previous year difficult, particularly within the operating revenue and cost types as well as in the balance sheet. The operating result (EBIT) declined by CHF 4.9 million to CHF 20.8 million due to special effects. Without this effect, the operating result would be at the level of the previous year. The Group result decreased by 9.8 million Swiss francs to 18.8 million Swiss francs. In the user market of NZZ Medien, sales growth of 2 percent was achieved with more subscribers.

The financial statements of the financial year are primarily characterized by the joint venture CH Media between NZZ Media Group and AZ Medien, which commenced operations on October 1, 2018. As of October, the NZZ regional media companies were transferred to the joint venture, and the corresponding revenues and expenses are no longer included in the consolidated financial statements as of that date. CH Media is accounted for using the equity method, and its proportionate share of net income is included within the operating result. This change has a significant impact on the financial statements of the NZZ Media Group. Overall, NZZ Media Group generated total operating income of CHF 383.5 million in the 2018 financial year. This corresponds to a decrease of CHF 44.7 million compared to the previous year. The decrease is mainly due to the transfer of the NZZ regional media to CH Media.

Earnings before interest and taxes (EBIT) decreased by CHF 4.9 million to CHF 20.8 million in the reporting period. The EBIT margin decreased from 6.0% to 5.4%. The decline is mainly due to one-off expenses in connection with the integration program of CH Media, half of which flow into the financial statements of the NZZ Media Group. The aim of the program is to merge the two companies from the NZZ Media Group and AZ Medien, thereby realizing synergies to secure a sustainable future. Excluding these special effects, the operating result would be at the level of the 2017 financial year. 

Mainly due to the non-recurring expenses of CH Media and a lower financial result in the 2018 financial year, the 2018 group result of NZZ Media Group decreased by CHF 9.8 million to CHF 18.8 million. The lower financial result is related in particular to price losses suffered on the securities portfolio in December 2018 and gains from the sale of equity interests included in the previous year. 

"The NZZ Media Group consistently focuses on first-class journalistic offerings. Our strategy and clear focus on our core business clearly distinguish us from our competitors. The signs from the market are encouraging; for example, we were able to increase the number of paying subscribers by4% last year," says Felix Graf, CEO of NZZ Media Group, commenting on the annual financial statements.

Equity including minority interests decreased by CHF 21.0 million to CHF 264.3 million. Due to a reduced balance sheet total mainly as a result of the transfer of NZZ Regional Media to the joint venture (disposal of assets and liabilities through deconsolidation of the individual companies), the equity ratio increased from 66.8 percent to 75.6 percent and is thus at a high level. The Board of Directors proposes to the Annual General Meeting a dividend of CHF 200 per share (previous year: CHF 250). 


Segment information

NZZ Media 

Revenues of the NZZ Media business unit increased slightly by CHF 0.4 million to CHF 157.3 million in 2018. In the user market, the sales of the book publisher NZZ Libro were omitted from June due to the cooperation with Schwabe AG. Excluding this effect, sales growth of 2% was achieved, primarily with more subscribers. In addition, service charges to the CH Media Group led to an increase in sales. In the advertising market, on the other hand, the continuing structural decline and, in addition, the bankruptcy of the advertising broker Publicitas had an impact, resulting in a decline in sales of CHF 3.7 million. The losses from the advertising market could only be partially compensated, and the operating result (EBIT) of CHF 5.0 million was CHF 1.9 million below the previous year.

Business media 

Sales of the Business Media unit decreased by CHF 2.9 million to CHF 53.4 million in 2018. The decline is attributable to discontinued operations such as the online platform eBalance, which was sold in 2017, and NZZ Fachmedien, which was transferred to the joint venture CH Media as of October 2018. Adjusted for these effects, growth of 4% would have resulted, attributable to the Conferences and Information Services segments. The operating result (EBIT) improved by CHF 1.4 million to CHF 8.9 million.

Regional media 

Due to the joint venture CH Media, the NZZ regional media companies are only included in the financial statements from January to September in the financial year 2018. From October onwards, the proportionate corporate result of CH Media is included. As a result of this change, the prior-year comparison in terms of revenues is significantly impaired. At CHF 6.9 million, the operating result is CHF 4.4 million below the previous year, mainly due to the non-recurring expenses at CH Media.

Re-elections to the Board of Directors 

At the upcoming Annual General Meeting on April 6, 2019, the ordinary term of office of Bernd Kundrun, Christoph Schmid and Etienne Jornod will expire. All three are standing for re-election in the same positions and are proposed by the Board of Directors for a further four-year term of office.


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