Modern Times Group Financial Results for the Period January - September 2001.Business Editors STOCKHOLM, Sweden--(BUSINESS WIRE)--Oct. 24, 2001 Modern Times Group MTG MTG Meeting MTG Mortgage MTG Magic: The Gathering MTG Mounting MTG Mind the Gap (London underground announcement) MTG Methanol To Gasoline MTG Manual Tank Gauging MTG Master Timing Generator MTG Micro Turbine Generator AB ("MTG") (Stockholmsborsen: MTGA MTGA Minnesota Turkey Growers Association MTGA Motion Tga , MTGB MTGB Medium to Good Beans ) (Nasdaq: MTGNY) today announced its preliminary results for the first nine months of 2001.
-- NET SALES UP 21% TO SEK 4,550 (3,775) MILLION
-- OPERATING INCOME FROM ESTABLISHED OPERATIONS UP 269% TO SEK 295 (80) MILLION
DESPITE NEGATIVE CURRENCY TRANSLATION IMPACT OF SEK 75 MILLION
-- ESTABLISHED OPERATIONS PROFITABLE IN THE THIRD QUARTER FOR THE FIRST TIME
-- TOTAL OPERATING INCOME EXCLUDING NON-RECURRING ITEMS UP 219% TO SEK 150 (47)
MILLION
-- 527,000 DIGITAL TV SUBSCRIBERS AT 30 SEPTEMBER 2001
SUMMARY (SEK MILLION)
July- July- Jan- Jan-
Sept Sept Sept Sept
2001 2000(a) 2001 2000(a)
Established operations
Net sales 1,411 1,187 4,539 3,774
Earnings before depreciation and
amortisation 67 21 465 265
Earnings after depreciation and
amortisation 18 -40 295 80
New ventures
Net sales 5 1 11 1
Earnings before depreciation and
amortisation -42 -21 -142 -32
Earnings after depreciation and
amortisation -49 -21 -145 -33
Total
Net sales 1,415 1,188 4,550 3,775
Earnings before depreciation and
amortisation 25 0 323 233
Earnings after depreciation and
amortisation -31 -61 150 47
Capital gains and divested
operations 0 -6 0 98
Income after financial items(b) -31 -74 96 109
Fully diluted earnings per share 0.11 -1.18 0.98 0.50
(a) Adjusted for changes in Swedish accounting rules.
(b) Excluding convertible debentures.
OPERATIONS AND ORGANISATION The Group has applied the new recommendations from the Swedish Financial Accounting Standards Council since 1 January 2001. As a result, costs arising from new ventures are no longer capitalised or depreciated Depreciated may refer to:
Established operations and new ventures have been split out in the table above in order to provide a more accurate description of the business. Businesses are considered new ventures for the first two years after launch. The new ventures are Viasat+, Viasat3 Hungary and Darial TV within the Viasat Broadcasting business area, as well as Everyday.com, Everyday.TV and Everymobile.com within the New Media business area. The Group structure was reorganised Adj. 1. reorganised - organized again; "a reorganized business" reorganized organized - formed into a structured or coherent whole at the end of 2000. This involved the formation of the New Media division and the transfer of TV8 from the Viasat Broadcasting division to MTG Publishing. The New Media division includes the Text-TV businesses and the Webad sales company, as well as established operations that have been transferred from the Viasat Broadcasting and Modern Interactive divisions respectively. The new ventures that are included in New Media are Everyday.TV (digital TV platform), the mobile internet Refers to gaining access to the Internet using a lightweight, handheld device. See Mobile IP, PDA, smartphone and mobile TV. services provided by Everymobile.com, and MTG's interest in Everyday.com. The Modern Studios division has started two companies, Modern Sports & Events and Modern Games, whose businesses consist of the production of boxing contests and the development of games respectively. In May 2001, MTG acquired 75% of the shares in Darial TV, one of eight national TV broadcasters in Russia. In June 2001, MTG acquired all of the outstanding shares in TV3 Latvia TV3 Latvia is a television channel targeted at a Latvian language audience owned by Modern Times Group (MTG). It was launched in 1998, but didn't receive a terrestrial license until 2001. and Star FM Latvia, which have therefore been consolidated with effect from 1 January 2001. After the close of the quarter, MTG subscribed to a private placement of new shares in its former operating subsidiary An operating subsidiary is a business term frequently used within the United States railroad industry. In the case of a railroad, it refers to a company that is a subsidiary but operates with its own identity and rolling stock. , Metro International
tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. basis MTG has a 15% ownership in Metro. The comparative figures in this report have also been restated to take into account these organisational changes and the changes in Swedish accounting rules. FINANCIAL RESULTS Total Group net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight increased by 19% to SEK SEK In currencies, this is the abbreviation for the Swedish Krona. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 1,415 (1,188) million in the third quarter and by 21% to SEK 4,550 (3,775) million for the first nine months of 2001. Group operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. before depreciation and amortisation Noun 1. amortisation - the reduction of the value of an asset by prorating its cost over a period of years amortization reduction, step-down, diminution, decrease - the act of decreasing or reducing something 2. increased to SEK 25 (0) million during the third quarter and by 39% to SEK 323 (233) million for the first nine months of 2001, excluding non-recurring items of SEK -6 million in the third quarter 2000, and SEK 98 million for the first nine months of 2000. Operating income for established operations increased to SEK 18 (-40) million in the third quarter and by 269% to SEK 295 (80) million for the first nine months of the year, excluding non-recurring items. Operating income for new ventures amounted to SEK -49 (-21) million in the third quarter and to SEK -145 (-33) million for the first nine months of the year, excluding non-recurring items. Total operating income improved to SEK -31 (-61) million in the third quarter and to SEK 150 (47) million for the first nine months of the year, excluding non-recurring items. The Group's net interest in the earnings of associate companies increased to SEK 9 (-11) million in the third quarter and to SEK 21 (-4) million for the first nine months of the year. Non-recurring items totalled SEK 0 (-6) million in the third quarter and SEK 0 (98) million for the first nine months of the year. Net interest and other financial items amounted to SEK 0 (-7) million in the third quarter and to SEK -54 (-36) million for the first nine months of the year, including net exchange rate gains and losses on the translation of financial receivables and liabilities in foreign currencies, but excluding items relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the convertible debentures Convertible Debenture Any type of debenture that can be converted into some other security. Notes: For example, a convertible bond can be converted into stock. . The net financial cost of the convertible debentures amounted to SEK -85 (-3) million, including currency losses on the translation of foreign currency liabilities into Swedish Krona Noun 1. Swedish krona - the basic unit of money in Sweden krona Swedish monetary unit - monetary unit in Sweden ore - a monetary subunit in Denmark and Norway and Sweden; 100 ore equal 1 krona of SEK -67 million. Income after financial items, including the costs for the convertible debentures, amounted to SEK -113 (-74) million in the third quarter and SEK 11 (106) million for the first nine months of the year. Profit after tax improved to SEK -53 (-78) million in the third quarter and amounted to SEK 8 (31) million for the first nine months of the year. Fully diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of increased to SEK 0.11 (-1.18) in the third quarter including non-recurring items and increased to SEK 0.98 (0.50) including non-recurring items for the first nine months of 2001. These figures take into account the 2,052,840 new shares to be issued as part of the management share option scheme and the 2,790,994 new shares to be issued in connection with the conversion of convertible debentures. Total assets were SEK 6,895 million at 30 September 2001, compared to SEK 6,040 million at 31 December 2000. OPERATING REVIEW Viasat Broadcasting Net sales: SEK 983 (798) million for the third quarter and SEK 3,159 (2,662) million for the first nine months of the year. Operating income after depreciation and amortisation: SEK 21 (38) million for the third quarter and SEK 286 (255) million for the first nine months of the year, excluding non-recurring items. - of which, operating income after depreciation and amortisation for established operations was SEK 50 (40) million for the third quarter and SEK 370 (257) million for the first nine months. - of which, operating income after depreciation and amortisation for new ventures was SEK -29 (-2) million for the third quarter and SEK -84 (-2) million for the first nine months. Viasat's Free TV channels - TV3, ZTV ZTV Zusätzliche Technische Vertragsbedingungen (German) , 3+, Viasat3 in Hungary and Darial TV - reported a 2% increase in net sales for the first nine months of the year to SEK 1,849 (1,811) million, despite weak advertising markets. Net sales for the third quarter amounted to SEK 507 (510) million. Net sales in Pay TV, which includes Viasat, TV1000, TV6 and Viasat Sport Viasat Sport is the common brand of several sports channels targeting the Nordic countries and Baltic countries owned by Modern Times Group. Viasat Sport is also the name of one tv-channel in the Baltics. Its main competitors are Canal+ and Eurosport. , increased to SEK 1,535 (1,061) million for the first nine months of the year and SEK 560 (356) million for the third quarter. This is an increase of 57% for the third quarter, which is due to strong sales of new digital TV subscriptions. The proportion of premium subscribers remains high.
Sept 2001 Sept 2000
Cardholders 1,154,000 1,067,000
- of which digital subscribers 527,000 -
Viasat Gold package subscribers 447,000 297,000
Other premium package subscribers 42,000 41,000
TV1000 517,000 377,000
New Media Net sales: SEK 28 (11) million for the third quarter and SEK 71 (45) million for the first nine months of the year. Operating income after depreciation and amortisation: SEK -5 (-13) million for the third quarter and SEK -52 (-20) million for the first nine months of the year. - of which, operating income after depreciation and amortisation for established operations was SEK 15 (6) million for the third quarter and SEK 9 (10) million for the first nine months of the year. - of which, operating income after depreciation and amortisation for new ventures was SEK -20 (-20) million for the third quarter and SEK -61 (- 31) million for the first nine months of the year. The increase in the division's net sales for the third quarter was 155%, with Text-TV showing particularly strong growth. The associated company associated company associate n → Partnerfirma f associated company n → società collegata , Everyday.com, showed improved result during the third quarter as a result of cost reduction measures. Radio Net sales: SEK 26 (30) million for the third quarter and SEK 94 (97) million for the first nine months of the year. Operating income after depreciation and amortisation: SEK 5 (-11) million for the third quarter and SEK 13 (3) million for the first nine months of the year. Cost reductions improved earnings for the radio channels in spite of unfavourable advertising market conditions. The results of P4 Radio Hele Norge P4 Radio Hele Norge ASA (OSE: PFI) Norway's leading national, private radio station with 24% national market share, about one million daily listeners and two million weekly. , Radio Nova Radio Nova may refer to one of several different radio stations, among them:
Publishing Net sales: SEK 38 (43) million for the third quarter and SEK 142 (156) million for the first nine months of the year. Operating income after depreciation and amortisation: SEK -23 (-21) million for the third quarter and SEK -54 (-45) million for the first nine months of the year. Advertising sales for Finanstidningen have been affected by the weak advertising market but is continuing to increase its market share. The investment in marketing campaigns to increase subscription sales has been successful and will improve future profits. The result for TV8 improved due to an increase in the number of subscribers and lower programming costs. Modern Interactive Net sales: SEK 164 (168) million for the third quarter and SEK 564 (419) million for the first nine months of the year. Operating income after depreciation and amortisation: SEK -29 (-19) million for the third quarter and SEK -30 (-61) million for the first nine months of the year. The division's net sales increased by 35% in the first nine months. The loss incurred by the division is primarily attributable to TV Shop's unprofitable media contracts. CDON reported a sharp increase in sales - up by 290% compared to the first nine months of last year - and earned a quarterly profit for the first time ever. CDON's operating income for the quarter was SEK 0.3 (- 17) million. SDI (1) (Serial Digital Interface) A physical interface widely used for transmitting digital video in various formats. For electrical transmission, it uses a high grade of coaxial cable and a single BNC connector with Teflon insulation. Media Net sales: SEK 109 (81) million for the third quarter and SEK 288 (235) million for the first nine months of the year. Operating income after depreciation and amortisation: SEK 13 (5) million for the third quarter and SEK 27 (10) million for the first nine months of the year. SDI Media's net sales increased by 34% in the third quarter and operating income was up 147% compared with same period last year. The division, which is the global market leader within the field of translating, subtitling and dubbing dubbing removal of most of the comb of day-old chickens. See also decombing. for TV and DVD DVD: see digital versatile disc. DVD in full digital video disc or digital versatile disc Type of optical disc. The DVD represents the second generation of compact-disc (CD) technology. , improved its profit margin to 12% (7%) in the third quarter. Modern Studios Net sales: SEK 142 (104) million for the third quarter and SEK 466 (340) million for the first nine months of the year. Operating income after depreciation and amortisation: SEK 18 (-9) million for the third quarter and SEK 55 (-3) million for the first nine months of the year. The division has shown strong growth during the first nine months of the year in both sales, up 37%, and operating income. Strix Television has been particularly successful during the year with international sales of its own-developed format, "The Bar", and with the recent launch of several new formats. FINANCIAL REVIEW Equity/assets ratio The Group's equity to assets ratio was 44% (40%) as at 30 September 2001. The ratio is defined as the sum of total consolidated equity and minority interests, including the Euro 120 million subordinated convertible debentures, as a percentage of total assets. In accordance with the new accounting principle adopted, previously reported intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. of SEK 850 million were charged against free equity, after an adjustment of SEK 238 million relating to the tax effect of this write-off. The Group also has minority interests in TV4 and P4 Radio Hele Norge, as well as shares in, and a convertible loan to, Metro International. These holdings are treated as fixed assets fixed assets npl → activo sg fijo fixed assets npl → immobilisations fpl fixed assets fix npl → . The aggregate market value of these securities amounted to SEK 1,317 (3,760) million at 30 September 2001, which amounts to a premium of SEK 825 (3,319) million to the book value of SEK 492 (441) million. After adjusting for this premium and deferred tax, the equity to assets ratio at 30 September 2001 was 48% (58%). Liquid funds The Group's liquid funds, including available credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities , amounted to SEK 961 (167) million at 30 September 2001. The liquid funds increased significantly as a result of the issue of the Euro 120 million convertible debentures. Net debt The Group's net debt amounted to SEK 938 (153) million at the close of the reporting period. The Group's net debt is defined as interest-bearing liabilities, including the convertible debentures, less interest-bearing assets. Excluding the convertible debentures, MTG's net debt amounted to SEK -231 (153) million. Capital expenditure The Group's capital expenditure during the first nine months of the year amounted to SEK 76 (230) million. Depreciation The Group's depreciation during the first nine months of the year amounted to SEK 172 (186) million. In accordance with the change in accounting principles, all accrued ac·crue v. ac·crued, ac·cru·ing, ac·crues v.intr. 1. To come to one as a gain, addition, or increment: interest accruing in my savings account. 2. retailer commissions on sales of Pay-TV subscription packages to Viasat Gold subscribers signing up for extended subscriptions have been reclassified from depreciation to other operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. . The comparative figures for 2000 have been restated accordingly. Earnings per share After full dilution, and taking into account the 2,052,840 additional shares to be issued as part of the executive share option scheme, as well as the 2,790,994 additional shares to be issued in connection with the conversion of the convertible debentures, earnings per share amounted to SEK 0.11 (-1.18) for the third quarter and SEK 0.98 (0.50) for the first nine months of 2001. OTHER INFORMATION This interim report has not been subject to examination by the Company's auditors. MTG's financial results for the fourth quarter and full year 2001 will be released in February 2002. Stockholm, October 24, 2001 Hans-Holger Albrecht President & CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. For further information, please visit www.mtg.se, email info@mtg.se, or contact: Hans-Holger Albrecht, President & CEO tel: +46 (0) 8 562 000 50 Mia Brunell Mia Brunell (born 1965) is a Swedish businesswoman. She will replace Vigo Carlund as CEO of Investment AB Kinnevik, the investment company of the group of companies created by Jan Stenbeck, on August 1 2006. , Chief Financial Officer tel: +46 (0) 8 562 000 50 Matthew Hooper hoop·er n. A maker or repairer of barrels and tubs; a cooper. , Investor & Press Relations tel: +44 (0) 20 7321 5010 Modern Times Group MTG AB has seven business areas: Viasat Broadcasting (free-to-air and pay TV channels in nine countries), Radio (seven networks in five countries), New Media (the Everyday interactive TV portal, Internet portal, Mobile portal, and teletext services This is an extremely incomplete list of teletext services available on different television channels around the world: Worldwide
Modern Times Group MTG AB's class A and B shares are listed on the Stockholmsborsen O-list (symbols: MTGA and MTGB) and ADRs are listed on the Nasdaq National Market in New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of (symbol: MTGNY). |
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