TMG annual report 2010

Transcription

This annual report is a translation of the original text in Dutch,
which is the official version. In case of any discrepancies the
Dutch version will prevail.
The annual report is also available in the English language via:
www.tmg.nl
For more information:
corporatecommunication@tmg.nl
Telegraaf Media Groep N.V.
Visiting address:
Basisweg 30, Amsterdam
Mail address:
P.O. Box 376, 1000 EB Amsterdam
Telephone: +31 20 585 9111
5
contents
6FOREWORD BY THE EXECUTIVE
BOARD
37 Corporate governance
38SUSTAINABILITY REPORT
8REPORT FROM THE SUPERVISORY
BOARD
9MEMBERS OF THE EXECUTIVE AND
SUPERVISORY BOARD
12 CONSOLIDATED KEY FIGURES
43FINANCIAL STATEMENTS
45 Consolidated Financial Statements
49Notes to the Consolidated Financial 90 Company Financial Statements
93Notes to the Company Financial Statements
Statements
13 CONSOLIDATED INFORMATION
13 Financial Performance
98OTHER INFORMATION
16 Corporate Affairs
98 Subsequent Events
99 Independent Auditors’ Report
20Telegraaf Media Nederland
102 Provision in the Articles of Association 20 National Dailies 23 Free Local Papers (door-to-door)
23 Magazines
Media Groep N.V. and Stichting Beheer 23 Digital Media
van Prioriteitsaandelen Telegraaf Media Groep N.V.
25 Sky Radio Group
concerning the appropriation of profit
103 Stichting Preferente Aandelen Telegraaf 104Annual report 2010 of Stichting Administratiekantoor van Aandelen Telegraaf Media-
26Keesing Media Group
27OTHER ACTIVITIES
27 Hyves
27 Mobillion
28 Telegraaf Media ICT (TMI)
28 Telegraaf Drukkerij Groep (TDG)
28 TMG Distributie
28 Shared Service Center (SSC)
29PARTICIPATING INTERESTS
32 RISK MANAGEMENT
36STATEMENT OF RESPONSIBILITY
Groep N.V.
106 about TMG
6
foreword by the Executive Board
Compared to last year, the focus of operations in 2010 has
shifted from measures designed to structurally lower costs, to
expanding the portfolio with the objective of maintaining and
expanding market leadership.
TMG’s recurring operating result before amortisation (recurring EBITA) increased by € 15 million in 2010 in comparison
to 2009. This represents a considerable increase in margin to
10.9%. This once again brings the long-term goal of 15% closer.
The improvement in the result is primarily due to the implementation of the measures agreed upon in 2010 and previous years.
The impact in 2010 is a reduction of € 35 million in the annual
cost level.
Revenues declined by € 20 million primarily due to the fact
that advertising revenues generated by the daily newspapers
across the full breadth of the market in 2010 did not benefit
from the limited economic recovery in the Netherlands.
The revenues of the acquired Hyves social network were, since
November 2010, recognised as part of TMG’s revenues.
TMG’s net result, including a revaluation of the interest in
ProSiebenSat.1 Media AG in the amount of € 44 million, rose
to € 81 million (2009: € 69 million including a revaluation of
€ 56 million).
results
On balance, the recurring EBITA of continued operations was
€ 65 million (2009: € 50 million) on € 592 million in revenues
(2009: € 612 million). The margin consequently increased from
8.1% in 2009 to 10.9% in 2010.
Advertising revenues generated by TMG’s newspapers, as well
as its radio operations, were under pressure. The resulting
decline in revenues was partially offset by the growth in online
revenues. In terms of circulation, revenues on balance marginally declined due to the discontinuation of De Telegraaf on
Sunday. This was offset by an increase in price and additional
sales during the 2010 FIFA World Cup.
The improvement in the recurring EBITA was primarily
achieved through cost reduction measures, including the discontinuation of the Sunday edition of De Telegraaf, the outsourcing of activities and the effects of the reorganisation
measures implemented earlier. The lower cost of paper also
contributed to the improved results.
business units
The business units made demonstrable progress in 2010 in
terms of collaboration and synergy.
Revenues generated by Telegraaf Media Nederland declined
modestly due to lower revenues from circulation as well as
advertising. Pricing in particular was under pressure with
regard to advertising revenue derived from printed media.
Revenues from digital activities rose. In the past year, this
business unit actively focused on a number of areas, including
the continued development of the digital market with a focus
on local markets and e-commerce, and on the establishment
of its own video media unit. From an organisational perspective, a number of units were merged to form a single national
media unit. In addition, the focus on regional and local markets was also strengthened.
Because primarily the advertising markets were adversely affected, Keesing Media Group was barely affected by
the economic uncertainties with respect to its traditional
puzzle magazines. Additional investments were made in
digital games in the past year. These games for the time
being only represent a small share of Keesing Media Group’s
revenues.
Sky Radio Group achieved improved results on limitedly
lower revenues. Sky Radio Group in 2010 devoted additional efforts to extending its FM radio licenses effective
September 2011 and to the future of digital radio. It will continue along this track in 2011. According to the Minister of
Economic Affairs, Agriculture and Innovation the FM licenses
will be extended at fair market rates. Current plans call for
the final decisions on this matter to be made by mid-May
2011.
The social network Hyves was acquired in November 2010 and
became part of TMG. Hyves occupies the number 1 position on
the Dutch internet: over 9.1 million citizens in the Netherlands
have a Hyves account of which 5.2 million are considered active
users. TMG has high expectations of Hyves, both on a standalone basis, as well as in terms of its collaboration with other
TMG media.
Mobillion in 2010 revised its strategy by disposing of activities
related to handling SMS traffic and by specialising in marketing
and communication services via social media.
Progress was made by the printing, distribution and ICT
production units, as well as the Shared Service Center, in both
the areas of quality, as well as cost control. Three particularly
outstanding matters included the terminations of the transportation operations, the start up of collaboration with colleague
newspaper publishers in the area of daily newspaper distribution and preparations for the conversion of TMG’s printing
presses in Amsterdam.
7
participating Interests
ProSiebenSat.1 Media AG, the international TV and radio enterprise in which TMG holds a 6% strategic interest (13,127,832
voting shares) and a seat on the supervisory board of directors,
also exhibited strong results due to the positive development of
the German economy. Revenues in 2010 rose by 8.7% to € 3.0
billion and the operating result before depreciation and amortisation (recurring EBITDA) rose by 30% to over € 900 million.
The share price of the preference shares followed this trend and
rose from € 8.06 at year-end 2009 to € 22.50 at year-end 2010.
The carrying value of the ordinary voting shares at 31 December
2010 was € 15.18 per share.
public broadcasting
There still is no level playing field for commercial publishers because the public broadcasters that are subsidised by
government drain off a great deal of time and money from
overall consumer media consumption and consequently also
compete directly on the advertising markets. Commercial
publishers who want to serve consumers as well as advertisers with successful media products, but who are also responsible for the profitability and continuity of their companies are
consequently at a major commercial disadvantage. A minor
improvement was the elimination of the Temporary Media
Concentrations Act, effective January 2011. However, in addition
to this, government should more clearly define the function and
objectives of a public broadcaster, including STER’s role. This is
the only way in which a level playing field can be created that
enables daily newspapers publishers to maintain their individual
daily newspaper titles, which would benefit multiformity.
sustainability
TMG is experiencing a growing demand for sustainabilityrelated reporting on the part of media consumers. In addition, other stakeholders also demand increased insight into
the economic as well as social and environmental impacts
of business operations. TMG is convinced that a carefully
considered policy for corporate social responsibility (CSR),
not only reduces negative impacts on the environment, but
also leads to savings through the more efficient use of natural
resources, innovations in the operating, commercial and editorial fields, client appreciation and motivated employees.
challenges
The Dutch economy is characterised by periods of growth
and decline. This is influenced by many factors, including
government incentive schemes and cost reduction measures.
Due to the nature of its activities, TMG as a company is sensitive to economic cycles. Advertising markets especially move
along with the rise and fall of the Dutch economy. As became
apparent in 2010, this does not, for that matter, apply to all
media types to the same degree or at the same point in time.
Television in the Netherlands experienced marked growth
during the past year, especially on the advertising side.
In addition, consumption and expenditures related to digital
media are growing notably. TMG’s ability to optimally anticipate these developments – in addition to achieving fartherreaching synergy among its business units – is its greatest
challenge, greater even than the challenge presented by
political and economic developments.
outlook
TMG is projecting stable circulation revenues in 2011. A key
question is whether advertising revenues will recover from the
decline experienced in recent years. The projections included
in the New Year’s speech still assumed a modest decline in
newspaper advertisements and a limited rise in radio advertising. However, advertising revenues derived from print and
radio markedly declined in the first two months of this year in
comparison to the same period in 2010. Revenues from digital
activities exhibited further growth as projected, autonomously
as well as due to the acquisition of Hyves. In total there was a
modest decline in the Group’s revenue in the first two months
of this year. Due to reorganisation measures, the rollout of collaboration in the area of newspaper delivery and the lower cost
of paper, there was a decline in costs. On balance, there was a
marginal improvement in the recurring EBITA.
As stated TMG is projecting stable circulation revenues for 2011.
It is impossible to predict to what extent the advertising trends
in print and radio in the first two months of 2011 will be representative for the remainder of the year. Revenues from digital
activities, in part due to the full-year effect of the Hyves acquisition, are projected to exhibit strong growth. In terms of
costs, aside from inflation, TMG will be faced with the effect
of the increases pursuant to the collective labour agreement
(CAO), the higher cost of paper, effective in the second half of
2011, and higher pension premiums. This is offset by further cost
reductions, including the collaboration with Wegener and NDC
concerning the distribution of daily newspapers. If the pressure
on advertising revenues in the first two months of 2011 persists
for the remainder of the year, a limited decline in margin must
be taken into account. Earlier projections called for an improvement in margin accompanied by a modest increase in revenues.
In view of the successful fiscal year 2010, ProSiebenSat.1 proposes
for a resolution by the Annual General Meeting of 1 July 2011 a
dividend payment for 2010 of EUR 1.14 per preferred share and
EUR 1.12 per common share. TMG holds 13,127,832 common shares.
Executive Board
8
report from the Supervisory Board
We hereby present the report, the balance sheet as at
31 December 2010 and the income statement for 2010 with
explanatory notes, as compiled by the Executive Board.
The financial statements have been audited and approved
by Deloitte Accountants B.V. in Amsterdam, as stated in the
independent auditor’s report.
The Supervisory Board discussed the financial statements
during the annual meeting with the auditor, after which we
signed the financial statements to comply with the Board’s
legal obligation pursuant to Article 2:101 Paragraph 2 of the
Dutch Civil Code.
The Supervisory Board met with the Executive Board six times
during the past year. Topics such as the general, financial and operational state of affairs were addressed. Additional topics, such
as the strategy and portfolio adjustments, including disposals and
acquisitions, such as Hyves, and the policy focused on the groupwide approach to so-called excessive employee salaries, were
also addressed. In our capacity as audit committee, we held four
meetings with the CFO of the Executive Board and TMG’s Head of
Group Internal Audit. The subjects discussed included the internal
risk management and control system and their actual implementation, the status of operational and strategic risk management, IT
systems, the 2010 audit findings and the 2009 audit follow ups.
During the meeting of 11 March 2010, we discussed a number of
areas with KPMG, including the financial portion of the 2009 Annual Report. The shareholders meeting of TMG held on 22 April
2010 approved the appointment of Deloitte as auditor. The 2010
management letter was discussed with Deloitte in the meeting of
28 October 2010.
During the year under review, in the absence of Executive Board
members, we discussed the performance of the Supervisory
Board and its members. In the General Meeting of Shareholders
dated 22 April 2010, the shareholders approved the nomination of
Mr D.H.H.D. Ropers as a member to the Supervisory Board
to fill the vacancy created by the death of Mr L.G. van Aken.
Following the departure of Mr H.L. Weenen effective 1 August
2010, the Supervisory Board’s selection committee in the autumn of 2010 initiated the procedure required to fill this vacancy. Prof W. van Voorden recently decided to give up his seat
effective 1 March 2011. We are grateful to both of them for their
long-term commitments to the company.
Also in the absence of Executive Board members, we discussed
the composition and performance of the Executive Board, our
relationship with the Executive Board, and the staffing of the
vacancy that will be created in April 2011 by the departure of
CEO Mr A.J. Swartjes, as a result of having reached the age of 62.
On 7 December 2010, TMG’s shareholders, in a Extraordinary
General Meeting of Shareholders, approved the amendment
to the remuneration policy for new members of the Executive
Board. This brings the policy more in line with the Corporate
Governance Code. The shareholders were informed of the hiring
of Mr H.M.P. van Campenhout as chairman of the Executive Board
as of 16 February 2011, in relation to the departure of Mr Swartjes.
We established the remuneration of the Executive Board on the
basis of the recently amended remuneration policy.
The results achieved in 2010 are cause for awarding a bonus
of two months’ salary on the basis of the joint and individual
targets achieved by the members of the Executive Board collectively and individually. In addition, we have decided to index
the fixed salary component by 1.8% effective 1 January 2011.
The remuneration of the members of the Executive Board is
recorded in the 2010 Annual Report on page 96. The Executive
Board’s remuneration policy is accessible via TMG’s website.
Two of our members took part in consultation meetings with
the Central Works Council during the year under review, and
informal consultation took place with the executive committee
of the Central Works Council.
We would like to express our gratitude to the Executive Board
and all employees for the manner in which they fulfilled their duties in 2010. In particular, we are grateful to Mr Swartjes, who after
more than 33 years of service to the Group will be leaving at the
end of April. Mr Swartjes joined the Group’s Executive Board in
1991 and has been its chairman since 2005. During this period,
TMG’s fixed cost base was significantly reduced and the company
transformed from primarily a newspaper operation to a multimedia company with a strong position in a changing media market.
We recommend that:
1. The 2010 financial statements be approved as set out in the
documents presented.
2. The Executive Board be granted discharge for the policies
pursued in 2010.
3. The Supervisory Board be granted discharge for the supervision conducted in 2010.
4. A cash dividend of € 0.45 per share of € 0.25 nominal value
be adopted for the 2010 financial year (2009: cash dividend
of € 0.35 per share of € 0.25 nominal value).
The dividend will be made available for payment on 5 May 2011
at Kas Bank N.V. in Amsterdam.
Amsterdam, 10 March 2011
On behalf of the Supervisory Board
A.J. van Puijenbroek, Chairman
9
members of Executive Board and
Supervisory Board
Executive Board
Supervisory Board
mr. H.M.P. Van Campenhout (1960), CEO
Mr H.M.P. Van Campenhout is Chief Executive Officer (CEO)
since 16 February 2011 and succeeded drs. A.J. Swartjes.
From 2001 until the beginning of 2010, Mr Van Campenhout has
been working for Reed Elsevier, most recently as CEO of the
Science & Technology division. During these years he built up
a great deal of experience with the media industry, and he led
successful transformations from print to digital. Subsequently,
he was, for a short time, CEO of USG People. In the period from
1984 to 2001, he held various international management positions at Shell. These roles were largely focused on the exploitation of consumers markets. Mr. Van Campenhout studied law
at Erasmus University Rotterdam and economics at Higher
Economic School Rotterdam.
A.J. van Puijenbroek (1947), Chairman
Mr. Van Puijenbroek is a Dutch national and is director of
VP Exploitatie N.V. As ancillary position he is member of the
supervisory board of B.V. Textielfabrieken H. van Puijenbroek.
His first appointment as supervisory board member of TMG
dates from 15 May 1975. His current term is from 2007 – 2011.
drs. F.Th.J. Arp RA (1954), CFO
Mr F.Th.J. Arp is Chief Financial Officer since 1 January 2005.
Mr Arp was holding company director from 1 July 1997 to
January 2005. From 1991 until 30 June 1997 he was a partner in the Deloitte & Touche Registered Accountants firm.
Before that, he worked in the firm’s accounting practice.
Mr Arp studied Business Economics and Accountancy at
Erasmus University Rotterdam.
Mrs. ir. M. Tiemstra (1954)
Mrs. Tiemstra is a Dutch national and is CEO of Arbo Unie and
former member of the Executive Board of Eureko N.V. As ancillary position she is member of the supervisory board of AON
Groep Nederland B.V. and member of the Supervisory Board of
the National Maritime Museum of Amsterdam. Her first appointment as supervisory board member of TMG dates from 5 June
2003. Her current term is from 2007 – 2011.
P. Morley msc (1956), COO
Mr P. Morley is Chief Operating Officer since 1 December 2007.
Before, he was CEO at Wolters Kluwer Nederland. Previously,
Mr. Morley was CTO and member of the Executive Board of
KPN and COO at Telfort. He studied mathematics and electrical
engineering at Trinity College Dublin.
drs. J.G. Drechsel (1955)
Mr. Drechsel is a Dutch national and is CEO of BCD Holdings
N.V. As ancillary positions he is member of the supervisory
board of TRX Inc., Eneco Holding N.V, FleuraMetz B.V. and
Parkmobile International B.V. His first appointment as supervisory board member of TMG dates from 26 september 2007.
His current term is from 2007 – 2011.
drs. A.J. Swartjes (1949)
Mr A.J. Swartjes has been Chief Executive Officer since 1 January
2005 until 15 February 2011. Mr Swartjes will leave the company
per 30 April 2011. From 1991 until 2005 he was a holding company director.This form of management ceased to exist in 2005.
He joined the Telegraaf Groep in 1978, and has held various positions since that time. From 1974 to 1978 he worked at Reader’s
Digest and Colgate/Palmolive. Mr Swartjes studied Economics at
Erasmus University Rotterdam.
drs. D.H.H.D. Ropers (1972), Secretary
Mr. Ropers is a German national and is the general manager of
Bol.com, the biggest webshop in the Netherlands. Mr. Ropers is
also member of the board at the Dutch home shopping organisation Thuiswinkel.org. On 22 April 2010 Mr. Ropers has been
appointed a member of the supervisory board of TMG. His current term expires 2014.
Due to the step back of Mr. ir. H.L. Weenen as of 1 August 2010
and Prof. dr. W. van Voorden as of 1 March 2011 two of the seats
in the Board are vacant.
Our radio stations test each track and every sound bit, which must meet
the expectations of our loyal listeners. FM frequencies remain critical to
the success of radio stations, although the broadcast tracks are increasingly
more often heard coming from a computer’s speakers. This increases
interactivity with listeners.
12
consolidated key figures
2010
2009
Revenues
592,297 611,840
Operating result Financial income and expenses Result before tax - continued operations 22,442 64,678 87,120 -2,870
62,738
59,868
Income tax Result discontinued operations, net of tax Net result of the year 6,159 0
80,961 907
10,365
69,326
Minority interest
Result attributable to shareholders of Telegraaf Media Groep N.V. -865 81,826 -1,179
70,505
Proposed result appropriation (not included in the financial statements) Released/Deducted from reserves Dividend payment
Pay-out ratio Cash flow from operating activities 60,338
21,488
26.3%
59,569 53,792
16,713
23.7%
49,252
Per share in €
Result Cash flow from operating activities Dividend 1.71 1.25 0.45
1.48
1.03
0.35
Employees (FTE) at year end - continuing operations 2,851 2,808
In thousands of euros
The 2010 and 2009 annual figures have been prepared in accordance with the IFRS guidelines applicable in 2010. The consolidated
statement of comprehensive income is presented on a going-concern basis.
The result from operations already discontinued or held for discontinuation were presented separately in 2009. This concerns the
activities in Sweden and the Ukraine, the activities of the Telegraaf Tijdschriften Groep in the Netherlands that were sold, Media
Librium and DataWire Sport. Keesing Reference Systems was sold in January 2010.
The discontinued activities in 2010 are not significant and are therefore not presented separately.
13
consolidated information
financial performance
results in summary
• The recurring EBITA result was almost € 65 million in 2010
and as s uch is € 15 million higher than it was in 2009.
• The recurring EBITA margin increased from 8.1% in 2009 to
10.9% in 2010.
• Revenues from continued business operations declined by almost € 20 million (3.2%), to € 592 million, due to lower
advertising revenues from newspaper and radio activities,
and the cessation of less profitable distribution orders.
Circulation revenues declined marginally by over € 5 million. Internet revenues (including two months of Hyves)
rose strongly to over € 51 million.
• Operating expenses related to continued activities, excluding amortisation and impairments, declined by approximately
€ 35 million due to a decrease of more than € 15 million in
distribution costs, a decrease of over € 8 million in the cost of
paper and a decrease of over € 12 million in personnel costs.
• The net result of almost € 81 million (2009: over € 69 million) includes a revaluation of the interest in ProSiebenSat.1
Media AG in the amount of almost € 44 million (2009: revaluation of € 56 million).
The decline in revenues in 2010 was more than offset by the lower costs of distribution, paper, outsourced work and personnel.
The operating result (EBIT) was € 25.3 million higher than in
2009 and amounted to € 22.4 million. The recurring EBITA
result rose by € 15.0 million to € 64.7 million in 2010. The recurring EBITA margin rose from 8.1% to 10.9%.
A net profit of € 81.0 million was realised in 2010 (2009: € 69.3
million), including a revaluation of the interest in ProSiebenSat.1
Media AG in the amount of € 43.8 million. A revaluation of € 56
million was included in 2009.
revenues
44.8%
5.6%
2.4%
0.6%
46.6%
n Advertisements
n Subscriptions +
single copy sales
nThird-party printing
nDistribution
nOther revenue
results
(normalised) EBITA
Revenues Other operating income Raw and auxiliary materials
Personnel costs Other operating costs Depreciation
EBITA
Normalisations
Restructuring costs Other
Total normalisations
Normalised EBITA
Amortisation
Impairment loss intangible
assets
Operational result
2010 2009
592,297 423 -44,377
-216,200
-258,399
-13,652
60,092 611,840
2,902
-52,556
-228,646
-274,301
-15,916
43,323
3,469 1,092 4,561 5,385
927
6,312
Advertising revenues in 2010 exhibited an unpredictable pattern across the various media types, as well as over the months
of the year. This applies to TMG, as well as the media sector in
general. This is caused by various factors: changes in the media landscape, fierce competition, events and most certainly
economic conditions in the Netherlands. Advertising revenues
on balance declined by € 12.0 million (4.3%) despite of events
such as the 2010 FIFA World Cup, the Olympic Games and
SAIL 2010.
64,653 Revenues in 2010 on balance decreased by € 19.5 million to
€ 592.3 million.
49,635
-37,650
-37,560
-
22,442 -8,633
-2,870
Revenues from paid circulation declined marginally by € 5.3
million, due to the discontinuation of the Sunday edition of De
Telegraaf and marginally lower revenue from puzzle magazines
in the Netherlands. The transition from De Telegraaf weekend
subscriptions to three-day subscriptions went well and the decrease in revenues due to the discontinuation of the Sunday
newspaper turned out to be limited.
14
The revenues from distribution activities for third parties decreased by € 2.6 million in 2010 as a result of the termination
of still remaining in-house transportation activities effective in
December and the termination of less profitable distribution
contracts.
Internet revenues rose by € 9.3 million to € 51.2 million.
The increase is primarily due to the growth in e-commerce
activities (including the Webshop), the Hyves acquisition and
the higher revenues from display advertising on news-related
websites.
Of the total revenues in 2010, € 36.5 million was realised
abroad. Revenues abroad amounted to € 36.8 million in 2009.
Revenues outside the Netherlands primarily concern circulation activities related to the daily newspaper De Telegraaf in
Europe/Southern Europe and the single copy sales of puzzle
magazines in France, Belgium, Denmark and Sweden.
Other operating income declined by € 2.5 million, primarily
due to the lower book profit from the sale of real estate.
segment revenue x € 1 million
2010
Telegraaf Media Nederland
258.6 Daily newspapers
Regional newspapers
94.1 Free local papers
50.4 Magazines
25.9 Internet
41.2 Other
9.4 479.6 Keesing Media Group
Puzzle magazines
Gaming
44.7 2.8 47.5 Sky Radio Group
Radio
Internet
38.8 0.8 39.6 Other activities
Distribution
Print third-party
Internet
Other activities
Totaal
2009
43.6%
15.9%
8.5%
4.4%
7.0%
1.6%
81.0%
Personnel costs declined by € 12.4 million in comparison to
2009, despite over € 3 million in charges in relation to the
employee profit sharing scheme and the IFRS charges for employee benefits. Expenditures related to temporary personnel
declined by almost € 3.4 million.
added value (AV) per employee
7.4%
0.5%
7.9%
40.8 0.9 41.7 44.9%
15.6%
8.6%
4.3%
6.1%
1.6%
81.1%
45.1 3.4 48.5 6.6%
0.1%
6.7%
274.6 95.4 52.7 26.2 37.6 9.5 496.0 7.5%
0.5%
8.0%
The Sunday edition of De Telegraaf was discontinued in December 2009. This resulted in a significant decrease in operating
expenses, primarily related to distribution. The transition from
weekend subscriptions to three-day subscriptions went well.
The lower cost of paper combined with a modestly lower volume resulted in a € 8.4 million decrease in paper costs.
6.7%
0.1%
6.8%
14.0 3.6 6.4 1.6 25.6 2.3%
0.6%
1.1%
0.3%
4.3%
16.6 3.6 - 5.4 25.6 2.7%
0.6%
0.0%
0.9%
4.2%
592.3 100.0%
611.8 100.0%
The revenues of Telegraaf Media Nederland and Sky Radio
Group declined by € 16.5 million and € 2.1 million,
respectively, primarily due to the decrease in advertising
revenues. Keesing Media Group’s revenues declined by
€ 1.0 million.
2005*/**/***
2006**/***
2007***
2008
2009
2010
TMG added value (x € 1 million)
Average
number fte
Average
AV per
employee
(x € 1.000)
4,317 3,826 3,353 3,284 2,988 2,806 92
83
104
93
103
111
395.6
318.3
348.0
304.7
308.9
312.2
* Including Limburg activities
** Including discontinued operations 2008
*** Including discontinued operations 2009
The number of employees in continued operations rose from
2,808 FTEs at year-end 2009 to 2,851 FTEs at year-end 2010,
primarily due to the acquisition of Hyves in November 2010.
The average number of FTEs in 2010 was 2,806, a decrease
of 182 FTEs in comparison to the previous year. The average
added value per employee rose from € 103,000 in 2009 to
€ 111,000 in 2010.
The other operating expenses were € 15.9 million lower than
in 2009. Distribution costs in 2010 were significantly lower,
primarily due to the discontinuation of the Sunday edition of
15
De Telegraaf, the optimisation of distribution activities and the
outsourcing of transportation activities effective December
2010. The costs associated with outsourced work declined due
to the discontinuation of the Sunday edition of De Telegraaf
and lower external printing costs.
Depreciation declined by € 2.3 million, primarily due to the sale
of properties and the full depreciation of the printing presses of
Drukkerij Noordholland.
An amount of € 37.7 million in amortisation expenses was
recorded in 2010 (2009: € 37.6 million). Hyves was acquired
in 2010. Its subsequent amortisation had a marginal impact on
the total amortisation expenses. Due to the economic situation, impairment losses totalling € 8.6 million were recognised
in 2009, as a result of which the total amount of amortisation
and impairment losses was € 46.2 million.
The result from associates totalled € 65.1 million in 2010
(2009: € 63.8 million). Aside from the result of the 6% interest
in ProSiebenSat.1 in the amount of € 18.8 million (2009: € 8.7
million), a revaluation in the amount of € 43.8 million was recognised (2009: € 56 million) due to the structurally improved
future cash flow projections. The impairment of the associate
ProSiebenSat.1 in the amount of € 99.8 million at year-end 2008
was therefore fully recovered at year-end 2010.
The financial income and expenses are inclusive of the results
from associates, which primarily include the effects of the associate ProSiebenSat.1, and the proceeds from the sale of
Keesing Reference Systems, Mobillion’s SMS activities and the
activities of 402Events. In addition, the interest rate impacts
associated with the liquidity position in 2010 are recognised
as part of the financial income and expenses.
The corporate income tax amounted to € 6.2 million in 2010
(2009: € 0.9 million). The effective corporate income tax
amounted to 7.1% in 2010 compared to 1.5% in 2009.
The net cash flow in 2010 was € 18.7 million negative, primarily
due to the acquisition of Hyves (2009: € 22.2 million positive).
The net cash flow from operating activities improved by € 10.3
million to € 59.6 million due to an improved result and lower
redundancy payments.
The cash flow from investment activities amounted to € 49.2
million negative, primarily due to acquisitions, including
Hyves. The negative cash flow from financing activities totalled € 29.2 million due to dividend payments of € 16.7 million and the repayment of long-term liabilities, including the
annual FM licence payments by Sky Radio Group. The approach that will be used for extending the FM licenses should
become clear during 2011.
shareholders’ equity
At year-end 2010, shareholders’ equity attributable to TMG’s
shareholders had risen to € 531.1 million compared with € 466.0
million at year-end 2009. Comprehensive income attributable
to shareholders of TMG for 2010 total € 81.8 million, while dividends totalling € 16.7 million were paid for 2009. Equity per
share totalled € 11.12 at year-end 2010, compared with € 9.76
at year-end 2009. The dividend to be paid for 2010 is not yet
reflected in the shareholders’ equity as at 31 December 2010.
shares
There are 47,750,000 ordinary shares and 960 priority shares of
€ 0.25 nominal value in issue. Of the ordinary shares, 29,176,077
had been converted into depositary receipts as at 31 December
2010, amounting to 61.1% (year-end 2009: 60.9%).
investments
The total net amount invested in 2010 was € 49.2 million (2009:
divestment of € 2.6 million). In 2010, this primarily relates to
the acquisition of Hyves and software investments. In 2009, the
divestments primarily related to the sale of cars when the car
fleet was outsourced.
In 2010 it was decided to invest approximately € 20 million in
expanding the colour printing capacity of the printing presses
in Amsterdam. This will provide greater flexibility in terms of
colour printing options, among other things. The investment is
essential in view of market developments and the goal of remaining market leader.
dividend policy
The dividend is normally set within a range of 15% to 30% of the
cash flow, with cash flow being defined as the sum of net result
and depreciation. A cash dividend payment of € 0.45 per share
is proposed. On a total of 47,750,000 outstanding shares and
depositary receipts for shares, this equates to a payout of € 21.5
million. The dividend for 2009 was € 0.35 per share.
16
consolidated information
corporate affairs
The Human Resources Shared Service Center (HRSSC) was
implemented within the Group’s HRM department in 2010.
An important project that will continue to be pursued in 2011
is the approach to excessive salaries. An important step has
been taken by TMG towards the decentralised management of
absence due to sickness. Other subjects included the introduction of a digital salary stub, new car regulations, integration
of companies into the central salary administration system,
renewal of the Social Plan and the transition of a part of the
personnel to the new collective labour agreement (CAO) for
Newspaper Publishers.
terms and conditions of employment, salaries, collective labour
agreements (CAOs)
above-market salaries
Agreement was reached with the Central Works Council (CWC)
at the end of 2009 concerning the approach for dealing with salaries that exceed the maximum of a salary scale by more than 10%.
This agreement was implemented effective October 2010. For the
time being it only applies to employees covered by the Grafimedia CAO and the CAO for Newspaper Publishers, senior staff and
employees not covered by a CAO. The impact of this approach
becomes evident when the above-market portion of the salary
is offset by (future) CAO increases. The trade unions disagree
with the procedure and its substance and initiated legal proceedings at the end of 2010. There is as yet no clarity concerning the
course of the process and the expected timing of a ruling.
TMG also wants to formulate agreements on this topic for employees covered by other CAOs during the CAO negotiations
starting up at the beginning of 2011.
CAOs
The uncoupling of administrative daily newspaper staff from the
Grafimedia CAO was effected in 2010. A new CAO for Newspaper
Publishers was implemented. The reason for this is that the Grafimedia CAO is primarily focused on graphic-technical personnel.
The CAO for Newspaper Publishers has, since February 2010,
been applicable to over 1,000 TMG employees. The terms and
conditions of employment remain the same under the new CAO.
New CAO provisions were agreed upon in 2010 for all CAOs within
TMG. This did not include any structural salary increases for 2010.
social plan
The trade unions, CWC and TMG reached agreement in December on a TMG Social Plan for 2011. The Social Plan in principle
remained the same as the previous Social Plan.
car regulations
The TMG Car Regulations were amended in 2010. Cost considerations played a key role in this regard. Based on the principle
of corporate social responsibility, the option of environmentally
friendly cars is promoted.
pensions
TMG’s pension plan for the majority of its personnel is administered by the Stichting Telegraafpensioenfonds 1959.
Over the course of 2010, it became clear that the effects of
higher life expectancy and declining interest rates would
affect this fund. This led to amendments to the pension plan
to be implemented effective 1 January 2011. These amendments concern the lowering of the accrual rate to 1.75%
(from 1.875%) and an increase in the social insurance contributions. The employer’s contribution is 17% (was 14%), while
the employee’s premium is 8.5% of the pensionable salary
(was 7%).
investing in employees
young journalists
In the context of the Young Journalists Incentive Scheme
introduced by the former Minister for Education, Culture and
Science, Ronald Plasterk, 9 young journalists were employed
over and above the regular complement and assigned to various
daily newspaper editorial boards. The scheme is temporary and
is in addition to the influx of young employees project based on
the Newspaper Journalists CAO.
employability
An employability project was initiated in the second half of
2010. Employees were offered workshops and employability
scans with the objective of improving their position on the job
market. This project will be continued in 2011.
organisation
absence and reintegration
In relation to managing absence due to sickness, the company transitioned from a central control model managed
by an internal occupational health & safety service to decentralised management by supervisory staff. The approach
involves fulfilling a proactive role in providing absence due
to sickness and reintegration counselling, in which there is a
sharper focus on the options open to an employee to return
to work. The first results of this new policy appear positive:
the absence due to sickness percentage dropped in relation to last year (forecast 3.9% compared to 4.7% in 2009).
Furthermore, the changed ways of working and the changed
organisation structure resulted in lower costs.
17
Human Resources Shared Service Center (HRSSC)
The HRSSC has taken shape and comprises the merged salary
administration units in Alkmaar and Amsterdam. The salary
administration groups of Sky Radio Group, WebRegio and GS
Media will be added to this starting in 2011.
The approach to dealing with excessive salaries was a theme on
the CWC agenda in 2010 as well. Agreement on this subject was
reached in 2009, following negotiations between the Executive
Board and the CWC. The CWC is carefully monitoring progress
in the implementation of this agreement.
Central Works Council (CWC)
What the future will bring in the changed media sector remains
to be seen. TMG is working hard at maintaining and expanding its top position in the Dutch media landscape, but it is also
in the throes of reorganising, centralising and reducing costs,
resulting in uncertain times for TMG employees.
Changes were made to TMG’s Executive Board in February 2011, due to the departure of Mr Ad Swartjes as CEO, as
a result of reaching the age of 62 in April 2011. The CWC was
therefore introduced to his proposed successor, Herman van
Campenhout, in 2010 and issued a positive recommendation
in support of his planned appointment. Ad Swartjes has made
an important contribution to the transformation of TMG from a
print-oriented family business to a broadly-oriented media
company. His vision of putting the client at the centre has been
of major importance to our organisation. His openness to the
CWC was very much appreciated by the Board. He viewed the
CWC as an important interlocutor and consequently always
promoted opportunities to increase its quality. Hopefully the
new CEO will adopt Ad Swartjes’ vision related to employee
participation and like Ad will make frequent use of the available
knowledge and competencies.
A number of items were submitted to the Central Works
Council (CWC) for advice or approval in 2010. The CWC
consistently took the interests of employees and the company
into account in reviewing each item.
As in 2009, 2010 was also an exciting year, for the company as
well as employees. The reorganisation of the internal facilities
service was completed, financial administrations were merged
and the HRSSC department was restructured. The CWC is
aware of the fact that it is necessary to reduce costs in order to
safeguard the continuity of the company, but also always keeps
an eye on what these changes mean to individual employees.
The advices have asked for this aspect to be given due consideration. The CWC also drew attention to the increasing work
pressures. To what extent can you reorganise?
The merger of a number of activities to create Telegraaf
Media Nederland | Landelijke Media (National Media department) concerns a radical organisational change that has a substantial – but not in detail predictable – impact on the affected
employees and the organisation. This is why the CWC consequently recommended that semi-annual evaluations be conducted so that course corrections can be made on a timely basis if necessary. In its recommendations, the CWC emphasised
that the individual characteristics of products should continue
to be clearly discernable: the highest possible level of collaboration in the back-office, but a clear signature at the front-end.
The CWC approved the new ‘complaints procedure governing
undesirable behaviour’. The CWC considers having more confidential counsellors within the company and proper internal
communications on this subject a good thing.
The CWC also approved TMG’s new strategic training policy,
which in CWC’s opinion will stand employees as well as the
company in good stead. The idea of linking the strategic training policy to the Performance Management System was well
received.
In addition to internal matters, the CWC also issued advice on
other matters. For example, the CWC looked in depth at the
acquisition of Hyves. Now that the advertising revenues from
newspapers are declining, it is necessary to devote more effort
to revenues from digital activities. The CWC is of the opinion
that the acquisition of Hyves is an excellent fit in this regard.
The CWC is devoting continuous attention to increasing the
quality of consultations. Various courses were taken for this
purpose, including the critical assessment of the council’s own
performance.
Future projections for the newspaper medium these days paint a sombre
picture. Nevertheless, the De Telegraaf has never had as many readers for
its paper and online combination as it does today. The fact that there is a
shift from paper to screen is indisputable; however, the pace at which this is
happening is unpredictable.
20
As a media operator, Telegraaf Media Nederland is involved
in gathering, creating and profitably exploiting information and entertainment (infotainment). Telegraaf Media
Nederland is the leading provider of infotainment to the
Dutch domestic market. To achieve its business objectives,
the policy is focused on maintaining and expanding its share
of consumer time and/or consumer media time, as well as
its share of company and consumer media expenditures.
ers collaborate with each other. In addition, there currently is
a single commercial business and a single editorial board with
end-responsibility.
Revenues from printed publications were generally under
pressure in 2010. Advertising revenues declined limitedly.
Its development during the year was unpredictable. While the
2010 FIFA World Cup had a positive impact in the summer, the
fourth quarter was disappointing. The circulation market experienced a modest decrease in circulation volume. Subscription
revenues declined modestly, primarily due to the discontinuation of the Sunday edition of De Telegraaf daily newspaper.
In part due to the declining print market trend, the growth of
the digital markets is steadily increasing in importance. It is evident that the additional efforts made in 2010 have resulted in a
clear growth in digital revenues.
The collaboration between regional dailies and free local newspapers (distributed door-to-door) was continued in 2010 and
will be intensified in 2011. Various steps were also implemented
in the local and regional markets in the digital domain: further
growth of Webregio.nl, start up of the Dichtbij.nl pilot and the
Vandaag.nl concept. In 2011, these initiatives will be brought
closer together and further rolled out in the marketplace.
The decline in revenues was amply offset by cost reductions.
Distribution costs declined, in part due to the discontinuation of the Sunday edition of De Telegraaf daily newspaper.
Automation costs declined due to further rationalisation and
staff reductions resulted in decreased personnel costs. Printing
costs also declined due to a decrease in the cost of paper.
On balance, Telegraaf Media Nederland’s EBITA result rose
considerably.
Based on its ambition and the objectives it sets for itself,
Telegraaf Media Nederland in 2008 embarked on a succession
of changes to its structure, mode of operation and portfolio.
Since then, structural decreases in costs have been realised
in various ways, such as reducing the number of employees,
despite of the expansion in digital activities, and by making
changes to the portfolio.
Telegraaf Media Nederland expects to be able to realise
growth by:
1. Focusing on the ‘Greater Randstad conurbation’;
2. Focusing on segments and themes;
3. Realising new revenues from existing clients (e-Commerce);
4.Realising new revenues by exploiting content on new media
carriers, such as mobile telephones and tablets.
Effective 1 November, the national activities within Telegraaf
Media Nederland were combined organisationally. Work is organised on the basis of a matrix structure in which the Daily
Newspaper & Magazines and the Digital & Segments publish-
The segment approach has been further extended and will be
expanded in 2011. The position in the various market segments
will be further improved by adjusting products, through different forms of collaboration and acquisitions.
daily newspapers
In the consumer market, the Dutch daily newspapers are represented by products that are different in nature, scope and
publication frequency. Furthermore they are segmented by
region and by free or paid newspapers. The Dutch circulation
market in 2010 (fourth quarter 2009 to third quarter 2010,
inclusive) consisted of approximately 5 million copies per day,
almost the same number as in 2009 (source: HOI).
Visits to the internet sites of Dutch daily newspapers remained
more or less stable. One in two Dutch residents in 2010 visited
one or more daily newspaper sites each month and on average did so 20 times per month. Especially well-educated Dutch
residents appear to be frequent visitors to the daily newspaper
internet sites (source: STIR).
Within the global Dutch net advertising market, the portion
related to daily newspapers amounted to € 616 million in 2009
(2008: € 815 million). A decrease of 4.5% to € 588 million is
projected for 2010 (source: Nielsen).
national dailies (paid)
The overall circulation of paid Dutch daily newspapers in 2010
(fourth quarter 2009 to third quarter 2010, inclusive) declined
by 2.1% to 3.5 million copies per day (2009: 3.0% decline and
3.5 million copies). The decline of 2.1% applied to the paid
national daily newspapers as well as the regional daily newspapers (2009: -3.2% and - 2.7% respectively). (Source: HOI).
The total advertising volume of paid dailies, expressed in millimetres, decreased by 5% in 2010 (2009: -9%). For the category
brands and services, it rose by 2% and for the categories personnel, family announcements and classified ads, it declined by
32%, 6% and 12% respectively.
21
The regional daily newspapers performed better on the advertising market than the national dailies. The volume of the paid
national dailies declined by 12%, while regional dailies lost 2%
in volume (source: ASS).
De Telegraaf daily newspaper
The recurring EBITA result achieved by De Telegraaf Daily
Newspaper rose strongly compared to 2009. Revenue declined due to economic developments and their impact on
the advertising market, and through the discontinuation of
De Telegraaf on Sunday. The discontinuation in particular, despite the increase in price, caused a modest decline in circulation revenues.
The decrease in revenue was more than offset through cost reductions, including lower distribution costs due to the discontinuation
of the Sunday newspaper, the lower cost of paper, staff reductions,
increased efficiency and expansion of elements of self-service.
A key project that is to be implemented in 2011 is the joint
distribution of De Telegraaf together with the newspapers
published by Wegener and NDC. This project is expected to
contribute to a further reduction in the cost of daily newspaper distribution.
De Telegraaf Editorial Board
The successes achieved by the Dutch soccer team during the
2010 FIFA World Cup naturally received a great deal of coverage in De Telegraaf, that during the last summer sometimes literally took on the colour orange for days. A team of reporters
and editors provided news, analyses and backgrounders for the
newspaper, online, in extra specials and via webTV. 2010 was
a spectacular sport year that also included the Olympic Winter
Games in Vancouver.
It was also a turbulent year for Dutch politics with the fall of the
Balkenende Cabinet, elections and an extended cabinet formation period. Crime reporting, including the flight of Joran van der
Sloot, also stood out. Through these, as well as countless other
high profile revelations, it was possible to set the topic of today’s
discussion throughout the Netherlands.
De Telegraaf’s editorial board was reorganised in 2010 as a
result of which it is now possible to direct the newspaper, internet, mobile, moving images and magazines from a central
news desk. In addition, journalistic activities related to entertainment (Privé) and cars (Autovisie) were consolidated during the past year.
Following the introduction of a free Telegraaf app and a paid
app designed to read the newspaper via the iPad, the editorial
board will in the near future undertake new initiatives designed
to fully exploit the many possibilities offered by the new generation of tablets. In addition, the provision of news on digital
media will be improved, as a result of which reach, partly due
to the increase in mobile, will be further increased. These developments will be managed by the deputy executive editor,
digital, appointed effective January 2011.
circulation
The circulation of De Telegraaf in 2010 (measured during the
fourth quarter 2009 to the third quarter 2010, inclusive) on average was 655,517 copies per day compared to 677,356 copies
per day a year earlier. This 3.2% decrease exceeds the average
2.1% contraction of the paid dailies market and as a result De
Telegraaf’s share of the paid dailies market declined somewhat
from 19.2% in 2009 to 18.9% in 2010 (source: HOI).
De Telegraaf’s subscription rates were on average increased
by 5% effective October 2010. The price of daily subscriptions
throughout the country on average rose by 3.5%.
De Telegraaf in 2010 was successful in shifting the emphasis
to maintaining and expanding paid circulation and phasing out
free circulation (e.g., sampling). Paid circulation in 2010 was
0.8% below 2009 levels and in total 2.8 million fewer free copies were distributed.
The discontinuation of the Sunday edition was compensated
by a renewed weekend supplement and a thicker Saturday and
Monday edition for readers. In part as a result of these interventions, the impact on circulation was less than expected.
De Telegraaf in 2010 derived maximum benefits from the successful course of events for the Dutch team in the 2010 FIFA
World Cup: overall circulation on average rose by 7.2% during
the World Cup. During this period, 1.5 million additional newspapers were sold (single copy sales and World Cup subscriptions).
The total De Telegraaf circulation is expected to be under pressure in 2011 as well. In addition to a continued structural decline
in the daily newspaper market, the lack of major sport events,
the further cleanup of free circulation and the increased subscription rates play a role in this.
Newspapers and television still remain the most important
sources of news for De Telegraaf subscribers. This was one of
the findings of the 2010 readership survey. Telegraaf readers
consider their newspaper primarily high profile.
The VROUW magazine’s success continued throughout 2010,
both in terms of the market and financially. The reach of the
VROUW increased and the number of advertisers, as well as
the advertising volume grew. Activities are increasingly being
organised around the VROUW brand.
22
advertisements
The declining trend experienced by the advertising market for
daily newspapers, persisted for De Telegraaf as well. Aside from
a loss in volume, prices were under pressure once again as well.
Efforts to realise additional revenues in June and July during the
2010 FIFA World Cup in South Africa were successful. In hindsight, it is possible that there was a shift of advertising funds as
well: the last quarter of 2010 was disappointing in relation to the
same quarter in 2009.
Collaboration between De Telegraaf and Sp!ts was intensified.
Combined reach propositions are being formulated for a number
of markets.
Efforts to target the job fairs advertising market for the titles
De Telegraaf, Sp!ts and the Vacaturekrant have been managed
centrally since last year. The decline in this advertising market
appears to be slackening.
national dailies (free)
The advertising volume of the Dutch free daily newspapers declined by 9%, due primarily to a decline in the personnel market (source: ASS).
The total circulation of free national daily newspapers in the
Netherlands in 2010 (fourth quarter 2009 to third quarter 2010,
inclusive) consisted of approximately 1.1 million copies per day
compared to approximately 1.2 million copies per day in 2009
(source: HOI).
Branded content is currently put on the market by Sp!ts under
the Sp!tsLAB label and up until now has resulted in a significant
number of successful collaborative initiatives between advertisers, agencies and editorial boards.
regional dailies
The regional daily newspapers were also affected by the poor
economic conditions in 2010. The marked decline in the total
advertising volume experienced by the regional daily newspapers
in the Netherlands in 2009 was followed by a further decline in
2010 (source: ASS).
The overall circulation of regional daily newspapers in the
Netherlands in 2010 (fourth quarter 2009 to third quarter 2010,
inclusive) declined by 2.1% to 1.55 million copies per day (2009:
2.7% decline to 1.59 million copies). (Source: HOI).
TMG’s regional daily newspapers (Noordhollands Dagblad,
Haarlems Dagblad, IJmuider Courant, Leidsch Dagblad, De
Gooi- en Eemlander, Almere Vandaag, alphen.cc) were faced
with a marginal decline in revenues in 2010. A further reduction in the personnel complement and cost savings in many
different areas, however, ensured that the result nevertheless
exhibited a marked improvement.
Sp!ts exhibited a sharply improved result. The failure of a turnaround in advertising revenues to appear led to further cost
reductions at Sp!ts. Circulation was further reduced. This was
on the one hand achieved by optimising the various points of
publication and on the other hand by discontinuing distribution channels making a low contribution in terms of the pass-on
factor, such as hospitals and colleges.
The circulation revenues of TMG’s regional dailies exhibited a
marginal increase. The total daily circulation in 2010 (fourth
quarter 2009 to third quarter 2010, inclusive) declined by 2.2%
(2009: 2.6%). The number of paid subscriptions declined by
2.0% (2009: 2.2%), which is 0.1% more favourable than the performance of the aggregate of all regional dailies; however, this
was more than offset by the increase in subscription rates.
Advertising revenues declined by more than 6%. While volumes increased, price pressures were high. The revenues from
local advertisers remained at par; however, revenues from personnel ads and from the domestic advertising market declined.
In the commercial domain, collaboration with De Telegraaf
was further expanded, as indicated above. This has resulted in
the announcement of a full integration of the sales activities of
Sp!ts, De Telegraaf, online and magazines, to take place in 2011.
The improved collaboration in the area of media agencies in
2010 led to further improvements in the competitive position.
In the editorial domain, a partnership was initiated with an external party in October for the purpose of enriching products
with mobile content. A technology has been developed that
makes it possible to use an iPhone or an Android phone to create a link between online and print. The newspaper currently
contains articles every day with a Sp!ts link logo containing a
link to online videos and background articles. Advertisers can
also acquire a link this way and the first advertisers have already
experimented with this approach.
A great deal of effort was devoted to online projects in 2010.
The project ‘Vandaag’ (Today) was initiated with a grant from
the Netherlands Press Fund and involves the phased launch of
a number of new local websites throughout the entire circulation area. Editors publish high quality news on these websites
after which citizens are invited to do the same. In addition, the
websites of the titles have been renovated and iPhone applications have been launched. A photo webshop has been opened
and the Plus membership has been introduced that awards
privileges to subscribers, such as access to all online publications. The objective of these initiatives is to commit the paying subscriber where possible. A partnership agreement was
concluded with the regional public broadcaster RTV NoordHolland as a result of which the number of platforms on which
regional news can be presented increases.
23
Efforts at optimising operations were implemented on many
fronts. The administration of the HRM department and the salary
administration were moved to the HRSSC. The Circulation department was reorganised, increasing its effectiveness through
means of the clustering of tasks. The ‘Jong voor Oud’ (Young for
Old) project initiated at the end of 2009, has resulted in a rejuvenation of the editorial board’s staff complement due to the fact
that 20 older editors made room for 11 younger entrants.
free local papers (distributed door-to-door)
Within the global Dutch net advertising market, the portion
related to free local papers (distributed door-to-door) amounted to € 568 million in 2009 (2008: € 634 million). An increase of
2% to € 579 million is projected for 2010 (source: Nielsen).
The advertising revenues and the result were under pressure
in 2010. Revenues have fallen back, particularly in the areas
in which TMG has been distributing free local newspapers for
longer periods of time. This is primarily due to the pressure on
prices in the market and the decline of advertising volume in
the personnel, car and property markets. Various cost reduction efforts, including a reduction in the personnel complement,
adjusted advertising/editorial relationships and the removal of
a number of non-profitable titles from the marketplace, sharply
improved the result.
The autonomous expansion and acquisitions in Utrecht and
Rotterdam resulted in a marked growth in revenues in comparison to 2009. The Weekmedia publications also exhibited a
marked growth in revenues in 2010.
The national advertising portal Local Media Partners (LMP),
which is responsible for national ad sales for a number of publications, including the Telegraaf Media Nederland’s free local
papers, continued to develop as an organisation in 2010 and has
furthermore signed up various local partners in order to expand
its national reach. LMP today is a recognised national advertising portal for large media agencies.
magazines
The total circulation of general interest magazines in the
Netherlands (excluding sponsored and daily newspaper
magazines) declined by 1.3% and amounted to over 25 million copies in the third quarter of 2010 (2009: 25.9 million
copies). (Source: NUV General Interest Magazines Group).
The Dutch advertising market for general interest magazines in
2009 amounted to € 259 million. This represents a decline of
26% in comparison to 2008 (€ 348 million). Revenues for 2010
are expected to remain stable (source: Nielsen).
The brands of Telegraaf Tijdschriften Groep were further integrated into Uitgeversmaatschappij De Telegraaf in 2010.
Privé, VROUW and Autovisie are leading brands in their
respective segments and each consists of a magazine, newspaper pages in De Telegraaf and associated websites.
VROUW has managed to develop significantly in the advertising
market and achieved a sharp increase in revenues. As a result,
VROUW’s development has outpaced the development of the
women’s magazines market. Reader appreciation for VROUW is
high. In 2010, VROUW acquired the URL Vrouw.nl and will use
this site to further strengthen the brand online as well.
The magazine Privé is faced with circulation and advertising market pressures, but is managing to keep the number of subscriptions
up to par. Market share has been lost in the advertising market,
however. The integration of the editorial boards of the Privé weekly, the page in De Telegraaf and the website is creating a strong
base for expanding the number one position in Entertainment.
The Autovisie magazine struggled with declining circulation, while
advertising revenues by contrast exhibited a notable increase.
The latter is partly due to the integral sales approach used in the
car market. A number of partnerships were concluded at the end
of 2010 that resulted in a turnaround in the decline in circulation.
digital media
The net media expenditures on the internet in 2009 amounted
to over € 800 million. This figure is projected to increase by almost 4% to € 847 million in 2010. The market can be broken
down as follows: Display, Classifieds, Search and Miscellaneous.
The Display Market in 2009 was € 205 million in size and is expected to reach € 209 million in 2010. Classifieds was € 175 million
in 2009 and is projected to be € 176 million in 2010. Search was
€ 410 million in 2009 and is projected to grow to € 435 million
in 2010. Miscellaneous: € 25 million in 2009 with a projection of
€ 27 million for 2010 (source: Nielsen).
Telegraaf.nl’s reach further increased in 2010. Telegraaf.nl
in 2010 received about 1.3 million unique visitors each day.
The average number of page views per month was 380 million
(2009: 290 million). Two new websites were launched under the
Telegraaf.nl banner in 2010: Mijnbedrijf.nl and Filmenuitgaan.nl.
Telegraaf.nl’s advertising revenues grew to € 11.3 million.
The growth in revenues was realised on the basis of standard
display advertising (banners) as well as customised concepts.
24
Telegraaf.nl also exhibited growth on the mobile internet.
The iPhone app has since been downloaded 400,000 times.
Telegraaf.mobi is one of the most often visited mobile sites in
the Netherlands. This site receives more than 600,000 unique
visitors with 50 million page views each month. The free
Telegraaf HD iPad app launched in June 2010 was recently
selected as the ‘best iPad app’ in the category News & Magazines NL, by Apple. In addition, a paid application has also been
developed for De Telegraaf on the iPad.
A number of key steps were taken in 2010 in terms of adopting
a segment-oriented approach. The basic premise in this regard
is to coordinate existing TMG components in such a way that
the different segments within the consumer as well as advertising market can be optimally serviced. Organisation changes
were implemented for this purpose in 2010 related to the market
segments Automotive, Travel, Entertainment, Boating and Job
Fairs. This resulted in a re-launch of the Autovisie.nl (car news),
Autotekoop.nl (previously the Autotelegraaf used car site) and
Reiskrant.nl websites.
In addition to optimising existing positions, plans specifically
call for the market position within the various segments to be
strengthened on the basis of launches and acquisitions.
In 2011, the impacts of the substantive and organisational changes
must become evident in the financial results achieved by the relevant segments. In addition, the segment-oriented approach will
be expanded to include other segments.
Nobiles Media and InfoPinnacle were confronted with a further
decline in advertising revenues, primarily due to negative developments on the job market. This put the result under pressure.
The grouping of elements in various business units related
to the job market into Telegraaf Media Nederland | Arbeidsmarktcommunicatie has resulted in tighter collaboration and in
achieving synergy in targeting the market / achieving market
share and in optimising costs.
Telegraaf Media Nederland has expanded its 50% interest in
JAAP.NL to full ownership. This has enabled Telegraaf Media Nederland to move into second position on the online housing market.
Various future scenarios have been developed for Speurders.nl.
Hyves.nl plays an important role in a number of these scenarios.
These scenarios will be further defined in 2011.
De Telegraaf’s webshop grew significantly in 2010, in terms of
sales as well as product range, number of visitors and transactions. The Webshop attracts 300,000 unique visitors each
month. The product range is diverse and primarily consists of
books, DVDs, CDs, gadgets, consumer electronics and household
appliances. Revenues in 2010 increased by € 1.8 million to € 6.2
million.
WebRegio operates in 85 regions with local and regional news
and information. The number of regions in which WebRegio operates with its own editorial content was increased to 27. A partnership was created in 2010 between Webregio.nl, Telegraaf.nl
and Dichtbij.nl (an online platform in which users can find and
share relevant hyper-local information). Pilots were conducted in
Eindhoven, Woerden, Zwolle and Heino in 2010. The intent is for
Dichtbij.nl to ultimately provide national coverage.
Relatieplanet once again achieved a high return in 2010, in part
due to its market leadership position. Competition in the dating market is however increasing due the entry of new players.
Relatieplanet passed the 3.8 million registrations mark and was
first in the Netherlands to develop mobile applications for a
number of mobile devices, including iPhone, Java phones and
iPad. In addition, Datingcadeau (gift coupon) and the Datingcollege service, an online course/training institute that provides
training and coaching in the field of online dating were developed.
Relatieplanet is proud of the fact that in November 2010, just like
the year before, it earned the title ‘Most Popular Dating site’ within
the ‘Website of the Year’ competition. In February, the Tros Radar
consumer television show had already chosen Relatieplanet as the
most effective paid dating site in the Netherlands.
News facts, revelations and journalistic investigations appear interchangeably on GeenStijl. GeenStijl, as well as Dumpert are growing at double digit rates in terms of visitors and page views. Over
230,000 unique visitors visit the site each day, as a result of which
the site is in the top 10 most often visited news sites in the Netherlands. Dumpert.nl is the largest video platform in the Netherlands
with 3 million unique visitors each month. GS Media’s advertising
revenues rose strongly last year. The return rose sharply as well.
With 200 million registered users, Habbo Hotel is the largest virtual community for teenagers in the world. The number of unique visitors to the Dutch joint venture created by the conceivers of Habbo
and TMG rose sharply in 2010. In addition, the proceeds from the
sale of virtual goods and advertising revenues rose considerably.
Habbo Hotel in the Netherlands consequently experienced the
best year ever in 2010, in terms of revenues as well as result.
In the field of television production, Video Media (VM) took a
major step forward in 2010: the ‘Droomhuis Gezocht’ (Looking for
a Dream Home) programme developed and produced in-house for
the public broadcaster Max (an average of almost 1.8 million viewers per broadcast) turned into a veritable viewing statistics success
story. VM in 2010 produced the daily morning show ‘Ochtendspits’,
the weekly current affairs programme ‘Uitgesproken’ and the evening
radio programme ‘Avondspits’ for the new broadcaster WNL.
In addition, a documentary series was produced for National
Geographic at the end of the year (‘Dagboek van onze Helden’
(Diary of our Heroes)), as well as the ‘Christmas Greeting’ for the
public broadcasters Max and WNL
25
Sky Radio Group
The size of the Dutch radio advertising market in 2010 was
over € 230 million compared to almost € 220 million in 2009,
representing an increase of approximately 5%. In spite of
television and internet competition, the market consequently
partially recovered from the 16% decline in the previous year
(source: Radio Advies Bureau).
TMG holds an 87.4% interest in Sky Radio Group, the largest
commercial radio enterprise in the Netherlands. Sky Radio
Group reaches over 5 million Dutch listeners per week with
its popular radio stations, such as Sky Radio 101 FM, Radio
Veronica, Classic FM and various online radio stations.
The advertising revenues of Sky Radio Group declined from
€ 41.7 million in 2009 to € 39.6 million in 2010. As a result, the
market share of advertising spending declined slightly. The result
improved due to further cost reductions. Radio Veronica’s modified programming and the rising listener figures of Sky Radio
101 FM are expected to result in a small increase in the share of
advertising expenditures in 2011.
The continuity of the enterprise in the coming years remains
highly dependent on the allocation of FM channels. The current Sky Radio 101 FM and Radio Veronica FM licenses expire
on 31 August 2011. The Minister of Economic Affairs, Agriculture and Innovation has let it be known that the current license
holders qualify for extension subject to the condition that they
must collaborate on, and invest in, the digitisation of the radio
landscape. The current permit holders will be required to pay
compensation in line with the market for the extensions, which
is expected to be lower than the current fees.
Collaboration with other TMG business units has produced the
necessary synergy benefits.
In 2010, Sky Radio Group added new online radio stations
such as Sky Radio NL and Veronica Rock Radio to its suite of
radio stations. With new digital developments, such as interactive iPhone apps, Android apps, new streaming technology
and new interactive websites, Sky Radio Group assumed a
leading role in the digital radio world. This position will be
further strengthened in 2011.
26
Keesing Media Group
Keesing’s profitability came out lower in 2010 than in 2009.
The decline is primarily due to the sale of Keesing Reference
Systems at the beginning of the year and the relatively high
start-up costs incurred by Keesing Games.
The profitability of the traditional puzzle books declined marginally, due to ‘package offerings’ on the part of competitors.
The decline in the Netherlands for the large part was offset by
improved profitability in France. Revenues in France remained
almost the same as last year; however, due to the introduction
of a new system, the efficiency of single issue sales increased,
resulting in a considerable improvement in margin.
Keesing has since introduced the first puzzle apps for the iPad.
The expectations for the puzzle market for this type of tablet
are high, although it will nevertheless take several years before
a significant share of revenues will be earned this way.
Keesing Games, which will have to expand its digital offer to
include more than just puzzles, was affected by a number of
technical problems in 2010 that have since been resolved.
27
other activities
Hyves
Last year it became clear that social media is well on its way to
becoming an integral part of the daily lives of Dutch internet users. The growth in the use of sites such as Hyves, Facebook and
Twitter, as well as the attention devoted to this phenomenon in
the media, is visible proof of this.
Hyves became part of TMG in November 2010. This provides
many new opportunities for growth and collaboration for both
parties. From a financial perspective, 2010 was a record year for
Hyves, in terms of revenues as well as result.
2010 market trends
Social media in 2010 continued its rapid advance in terms
of use and attention without let up. Research by Statistics
Netherlands (CBS) shows that the use of social media in the
Netherlands has moved into second place within Europe, after Poland. 91% of younger people is active on social networks
(source: CBS). The growth of international players, such as
Facebook, Twitter and LinkedIn creates a greater dynamic and
attention for Social Media in general. In part due to the young
character of the market, all players profit from the growth in
visits and revenues. Hyves, in all respects, is clearly the number
1, in part due to the focus on local relevancy and personal
attention to Hyves users. Compared to number 2 in the market,
Facebook, Hyves daily has 2.4 times as many visitors, who furthermore on average spend 3.5 times as much time on the site
(source: Comscore, November 2010).
connecting citizens throughout the Netherlands
Based on its orientation on and anchoring in the Netherlands,
Hyves has proven itself capable of further expanding its strong
market position. Its mission, ‘Hyves Verbindt Nederland’ (Connecting Citizens throughout the Netherlands) has created a clear
focus and good results. Examples of key activities include:
• S
trengthening the number 1 position in the Netherlands.
Over 9.1 million citizens in the Netherlands have a Hyves
account of which 5.2 million are considered to be active
users. In November 2010, an average of 3.3 million Dutch
citizens visited the website each day, spending over 1.9 billion minutes online (source: Comscore, November 2010).
• The launch of several new products, such as Hyves Afrekenen
(online payments in collaboration with the Rabobank),
Hyves Mobile (mobile operator in collaboration with
T-Mobile), Hyves Games (online games platform in collaboration with Spil Games), Hyves TV (watching social TV) and
Nu in Nederland (what is happening in the Netherlands?).
Hyves also played a role during the national elections and
organised the first ‘live chat debate’ in the world involving
all party leaders. In part by continuously expanding mobile
applications and new functionality, such as mobile chat, the
mobile use of Hyves also grew strongly in 2010.
• The ability of Hyves users to experience the 2010 FIFA
World Cup close up, thanks to the media partnership with
the KNVB – the Royal Dutch Football Association – and
Hyves’ own reporters. In addition, Hyves’ collaboration
with De Telegraaf’s Telesport resulted in the largest World
Cup football pool in the Netherlands, with over 250,000
participants. At the end of November, Hyves became a
media partner of NOC*NSF for the purpose of encouraging top sportsmen, as well as promoting recreational
sports in the Netherlands.
• The successes achieved on behalf of clients via integrated social campaigns. An example of this is the organ
donor recruiting campaign. This campaign resulted in over
25,000 registrations over a few weeks (by comparison,
the earlier TV donor show resulted in 7,000 registrations).
Mobillion
Mobillion specialises in providing services in the marketing and
communications market using social media. The decision for the
time being is to focus on products for the job market and the
fundraising market.
The Recruitr product, focused on the job market, is currently
being used by more than 35 companies. iCollect, an instrument
designed to recruit canvassers and volunteers via social media,
was introduced at the end of 2010. This product will soon be
followed by iGive, a service focused on online fundraising within
social media.
Mobillion’s share of the Interactive Voice Response market
(0800/0900) has increased due to a number of new clients,
some of which come from the world of television.
Due to a shrinking (premium) SMS market in the Netherlands,
the so-called ‘SMS Brokerage’ (the technical and administrative
settlement of SMS traffic) was disposed.
Collaboration with other TMG units significantly increased in the
past year.
28
Telegraaf Media ICT (TMI)
Shared Service Center (SSC)
A quality and affordable information management function proved to be a key production factor in 2010 as well.
Progress was made last year in the area of improving the information management function in terms of quality, cost and risk
management, continuity and governance.
The consolidation of a number of corporate services into the
Shared Service Center continued in 2010. Key in the subsequent professionalisation initiative was a reduction in integral
costs and improvement in the quality of the services provided,
through process optimisation, automation and the design of
the management organisation. In 2011, the focus will be on
strengthening the management organisation and supplier
management. This will take the form of further intensifying
collaboration with internal clients, as well as suppliers, and
providing a more targeted focus in managing their contribution to TMG.
Further steps will be taken in 2011 designed to produce greater
efficiency, lower costs, better governance and further consolidation of the generic information management function, and
improved connectivity.
Telegraaf Drukkerij Groep (TDG)
TDG implemented a number of reorganisations in 2010 due to
the discontinuation of the Sunday edition of De Telegraaf and
the completion of the conversion to Computer to Plate. The reorganisations did not have any negative effects on production.
Effective 2011, investments are being made and work is
being done on the technical conversion of the newspaper
printing presses in Amsterdam. This will result in expanding
the full-colour options available for newspapers. This involves
an amount of approximately € 20 million, to be disbursed in
the next two years.
TMG Distributie
TMG Distributie achieved autonomous savings in its logistics
network without compromising on the quality of delivery and in
addition started up a strategic partnership for the distribution
of newspapers with Royal Wegener and NDC Media at the end
of 2010. The objective of that partnership is to, through joint
delivery, achieve further delivery cost savings in the distribution
regions served by Wegener and NDC, while maintaining distribution quality levels. In that context, joint delivery took place in
the Twente region, at the end of 2010. This area will be expanded at the beginning of 2011 to include the province of Groningen
and part of the Province of Drenthe. A further phased rollout to
other regions will take place during the course of 2011.
The last two transport locations of DistriQ Transport,
Rotterdam and Amsterdam, were closed in 2010. These closures
were accompanied by a reduction of 74 jobs. TMG Distributie is
currently making exclusive use of external carriers for the primary transport from the printer to transhipment points and is
realising significant cost savings as a consequence.
29
participating interests
ProSiebenSat.1 Media AG
TMG has a 12% interest (13,127,832 shares) in the share capital
with voting rights of ProSiebenSat.1 Media AG (ProSiebenSat.1),
representing an economic interest of 6%.
ProSiebenSat.1 is an international media combination, primarily
in the domain of television and radio, with a strong market position and strong financial results. The interest is consistent with
TMG’s multimedia strategy. Through the presence of ProSiebenSat.1 in the Dutch market, TMG maintains prospects related to
television activities in the Netherlands.
Based on the 12% interest in the shares with voting rights, TMG
has a seat on the Supervisory Board and a seat on the remuneration committee, and in this way is able to exercise influence
on the policies pursued by ProSiebenSat.1.
financial performance
In part due to the positive development of the German economy, ProSiebenSat.1 was also able to exhibit rising results in
2010. Revenues in 2010 rose by 8.7% to € 3.0 billion compared
to € 2.8 billion in 2009. The recurring EBITDA rose to over
€ 900 million (2009: € 697 million), in part due to realised
synergy benefits and cost savings.
valuation
Pursuant to the IFRS accounting principles, TMG’s equity interest in ProSiebenSat.1 is classified as an associate, i.e. a participating interest over which significant influence can be exercised.
The acquisition value of the shares is € 182 million, which is the
exercise price of the option at the time (€ 377 million) subject
to the deduction of the already recognised impairment of € 195
million when the option was exercised in 2008, which is irreversible in accordance with the IFRS guidelines.
The valuation of the interest in the ProSiebenSat.1 associate
as at 31 December 2008 includes an impairment of € 99.8 million due to expected structural pressure on revenues and the
result in 2009 and beyond. As a result of the realised cost savings and improved prospects, € 56 million of this impairment
was reversed as at December 2009. In part due to the sharply
improved cash flow and the once again improved prospects
related to the revenues and the result, the remaining € 43.8
million of the impairment was reversed as at 31 December
2010. The current IFRS regulations preclude the possibility of
further impairment reversals.
In addition, in recent years TMG’s 6% share in the net result of
ProSiebenSat.1 was recognised as the result from an associate
and incorporated into the balance sheet valuation. As at
31 December 2010, TMG’s interest in ProSiebenSat.1 was
valued at over € 199 million, or € 15.18 per share. The share
price of the preference shares (without voting rights) rose
from € 8.06 per share on 31 December 2009 to € 22.50 on
31 December 2010. The carrying value of the common shares
at 31 December 2010 was € 199.3 million (2009: € 136.8 million).
ProSiebenSat.1 in the Netherlands
Revenues from television advertising expenditures (spot advertising) amounted to € 863 million in 2010, a growth of 10.6% in
comparison to 2009 (source: SPOT).
SBS Nederland
ProSiebenSat.1 is represented in the Dutch market by the commercial television channels SBS6, Net5 en Veronica TV and by
Veronica Magazine, the market leader in Dutch TV magazines.
On average SBS Nederland’s market share of the viewer market was 24% in the 20 to 49 age group, which is a key target
group for advertisers. The SBS6 television channel in 2010
had an average market share of 11.9% (2009: 14.2%). The Net5
channel had an average market share of 5.8% (2009: 6.9%) and
Veronica TV had an average market share of 6.3% (2009: 6.5%).
In terms of the baseline used for comparison, SBS Nederland in
2009 achieved the highest market share since its foundation.
The decline in 2010 is primarily caused by the intensified competition from commercial as well as public broadcasters. The competition of the public broadcasters in particular became evident
during the Olympic Games and the 2010 FIFA World Cup.
SBS Nederland in 2010 achieved a higher market share of the
advertising market than its market share of the viewer market.
ProSiebenSat.1 has announced its intent to sell parts of the
enterprise, including SBS Benelux and/or SBS Scandinavia.
TMG – depending on the conditions under which this would be
feasible – is interested in acquiring SBS Nederland.
The amount of time people spend on social media is increasing by the day.
Mobile telephones and tablets are increasingly used for this purpose.
This combines two key developments of the near future.
32
risk management
description of the risk management
system
Taking risks is an unavoidable part of achieving company objectives and strategy for any company. To be able to manage
these risks to the maximum possible extent, TMG has developed a risk management methodology focused on increasing
risk awareness within the company and on acquiring and maintaining insight into operational risks. By applying a standardised
and systematic approach in all business units, TMG can compare
the risk profiles of its business units and consolidate them for
the purpose of developing a TMG-wide risk profile. TMG uses a
framework for this purpose that is subdivided into the following
risk categories: strategic, operational, financial and compliance.
This risk framework is derived from the COSO Model (Committee of Sponsoring Organisations of the Treadway Commission).
COSO identifies the relationship between company risks and
the internal control system.
Risk management within TMG is embedded in business operations and is also used as a management tool.
The Audit Committee of the Supervisory Board monitors the
quality of the risk management, the internal risk management
and the risk management methodology.
evaluation of the internal risk
management system
The following improvements were made to the risk management system in 2010:
• The policy was fine tuned making it mandatory for management to implement risk management in a structural way as
described in this policy.
• The risk management function is implemented at the TMG level.
• The implementation of operational risk management within
Telegraaf Media Nederland has been delegated to the line
organisation. A start on a similar transition has been made by
the other business units and will be given further form in 2011.
• The process owners once each quarter assess the risk profile
on the basis of any changes to the process and identify the
actions that will be taken to further limit risks. They regularly
carry out audits to check the operation of the most important control measures.
• As part of the planning and control cycle, management once
every quarter reports on the updated risk profiles, the status
of outstanding actions and the outcome of the audits of the
most important control measures.
• Internal Audit checks the management of risks as part of its
audits and reports on its findings to the Executive Board and
the Audit Committee. Internal Audit makes use of completed
risk analyses in carrying out its audits.
• The external auditor uses the completed risk analyses and
audits of the most important control measures as much as
possible.
• The findings of the external accountant and Internal Audit
are incorporated into the risk analyses and monitoring takes
place as part of the planning and control cycle.
• Specific attention is devoted to the analysis of fraud risks at
TMG and the identification of control measures to prevent it.
Although TMG has set up a good risk management methodology,
it is not possible for this system to provide an absolute guarantee
for achieving the enterprise’s objectives, nor can this system completely prevent substantive errors, fraud or a violation of laws and
regulations.
strategic risk management
Strategic risk management is integrated into TMG’s planning
and control cycle. Strategic workshops are held every year by
the business units as well as the Executive Board together with
Group staff members. A strategic risk management workshop
was also held in 2010 with the Executive Board and the staff with
end-responsibility from TMG’s three media enterprises, in which
the major risks were identified and discussed. The risks are identified and assessed on the basis of the objectives for the coming
three years during the strategic workshops. As part of the planning and control cycle, the business units once every quarter
report on the most important risks and the progress on the actions to be taken. The risks are discussed during the quarterly
meetings of the Executive Board. The quality of the implementation of the risk management process is part of the performance
assessment of the management members of the business units.
The Executive Board and the Group staff members take action
on the most important business unit-transcending risks. In 2010,
the strategic risks of the business units were further integrated
into the group-wide strategic risks. As such, combined cause
and effect analyses were executed and actions formulated.
operational risk management
A uniform framework of standards was developed for the primary and supporting processes, which applies to each business unit. The key risks and the expected control measures
were identified for each process. Risk analyses are carried out
in which the control measures are identified, the operational
risks evaluated and if necessary actions are formulated to better control these risks. Key risk analyses carried out for the first
time, or repeated, in 2010 concern the sale of ads, subscriptions
or single copy sales, the editorial board, printing and salary
administration processes, information security, change management and the facilities services processes.
33
financial risk management
Financial risks are separately identified in the annual report and
are also monitored as such. TMG recognises the market, credit,
foreign exchange and interest rate risks as part of its normal
business operations. Furthermore, the trend in the price of
paper can affect the operating result. These risks however only
have a modest impact on TMG’s financial position. For this reason TMG only carries out an internal sensitivity analysis of these
risks at a high level.
Significant items in the financial statements are selected on the
basis of their material financial significance. Control measures
are identified as part of the processes for these items. The operation of these control measures is tested.
compliance risk managementt
The compliance risks are monitored by the Compliance
Officer. Various control measures designed to limit compliance
risks were implemented. TMG’s code of conduct was modified
in 2010, with specific attention being given to subjects such
as fraud and the continuity plan. A fraud policy and process
has been developed and a risk analysis was performed. A risk
analysis of the continuity planning process will follow in 2011.
The compliance risks will be further integrated into the risk
framework in 2011.
progress of actions related to risks
identified in 2010
Further to the major strategic risks identified in 2009 for the
2010 financial year, the following is a report of the actions implemented for the purpose of mitigating the identified risks.
‘Insufficient ability to achieve targeted results due to unfair competition, due to the opportunities provided to public broadcasters in the domain of multimedia information’
Attempts to mitigate this risk were made through efforts designed to make this issue and its urgency clear to involved parties.
For example, TMG in collaboration with other players (NDP, VCR
and Vestra) in 2010 submitted a report to the Ministry of Education, Culture and Science on the market distortion caused by public broadcasters. A ruling by the courts has determined that the
minister must test new initiatives for market distortion. The coalition agreement concluded by the new cabinet in 2010 includes
a statement concerning future reductions in spending on public broadcasters. TMG will continue to make efforts designed to
create a fair competitive environment. This risk has therefore once
again been included in the top 5 in 2011. At the same time, TMG will
continue to make efforts to strengthen its own position through
the development of differentiating products and services.
‘Advertising revenues are falling more than expected due to a
persistent poor economy, fierce price competition, attacks by
competitors and other media types’
The advertising market is in full motion. Pursuant to the shift
of advertising budgets between media types, TMG continues
to adjust its product portfolio to the wishes and demands
of the marketplace. The bundling of national media within
Telegraaf Media Nederland also makes it possible to better
meet the wishes and demands of the consumer and advertising markets. Pursuant to organisational changes, ad sales for
De Telegraaf, Sp!ts and the digital brands now take place
centrally. In addition, the segment-oriented approach makes
it possible to better exploit synergy benefits. Flexibility is essential in order to keep pace with developments. Self-service
is increasingly important for optimising processes. In order to
mitigate the impact of declining advertising revenues, TMG is
also expanding its portfolio, for example, by the farther-reaching development of e-commerce activities.
‘Insufficiently capable of effecting the migration to and development of the digital world on a timely basis, as a result of which
TMG fails to anticipate changing media consumption behaviour
in time’
In the 2009 recession year, attention was primarily focused on
achieving cost reductions and improved returns by optimising
existing activities. The migration to the digital world was accelerated in 2010. TMG wants to be accessible with its portfolio
on all electronic resources that are popular or are becoming
popular. The objective in this respect is to generate revenues
from consumers and ad sales via mobile telephones and tablets, among others. TMG has initiated the creation of a New
Business Fund designed to stimulate the accelerated growth
of young innovative companies through means of participating
interests/minority participating interests in innovative digital
initiatives. Based on the strengths of TMG’s brands, TMG supports the entrepreneurs in the area of marketing and communications and consequently gains access to a network of internet
entrepreneurs that makes it possible to bundle competencies
and experience. The Keesing Media Group is focused on the development of digital games. Sky Radio Group rolled out new
streaming technology. In addition, a number of new online radio
channels was introduced, such as Sky Radio Dance Classics, for
example. An additional important further step into the digital
world was made with the acquisition of Hyves, and consequently a strong position has been taken in the world of social media.
‘The continuity and reliability of ICT and other processes, data
and systems’
Progress was made in the area of information security and risks
strongly declined by using a project-oriented way of working.
A risk analysis of information security and the change manage-
34
ment process was conducted in 2010. The risk management
framework is monitored once every quarter. The information
security policy was renewed. A start on structuring the new ICT
organisation was made in 2010. TMG is highly dependent on ICT
systems and telecommunication networks. TMG is primarily focused on generic ICT services (versus customised applications),
which reduce the organisation’s risk exposure. This is evident
in the creation of standard workstations, where possible, and a
reduction in the number of applications used. The maintenance
backlog of the key components of the ICT data Centers was
eliminated in 2010.
risk and control measures identified
for 2011
Strategic risk management workshops were conducted toward the end of 2010 in all business units. The objective was
to identify the risks that could impact the 2011 objectives.
Together with the business unit-transcending risks that have
been identified, they result in the following summary of key
strategic risks for 2011.
‘Due to the lack of a cohesive media policy on the part of government, TMG is insufficiently capable of achieving result due to
unfair competition’
Media legislation in the Netherlands is designed in such a way
that print, digital, television and radio are considered separate entities. This could not be further from the truth. Market
players are increasingly becoming direct competitors due to
the fact that the distinction between media types is becoming
blurred. An example of this is the risk of unfair competition
between public broadcasters and commercial market players,
including in the area of the internet. In spite of farther-reaching technological developments (internet and digital radio,
the introduction of G4), there is in addition a continued risk
that government will fail to sufficiently lower the license fees
for FM lots, while competition from all sides is intensifying.
A positive point is that since 1 January 2011, the Temporary
Media Concentrations Act ceased to be in effect, as a result
of which cross-ownership constraints are eliminated. The government that came into power last year has indicated that
it will cut back spending on public broadcasters. In addition,
the Minister of Education, Culture and Science is required to
assess the negative impact of market distorting decisions via
ex ante market tests. The effect of such decisions is however only discernable after three to five years. TMG needs
to transition to digital now, which is why it is precisely now
that unfair competitions is a major risk. TMG will continue its
efforts to bring this issue and its urgency to the attention of
the involved parties.
‘Advertising revenues are declining beyond expectations’
The pressure on the advertising market remains high, so that
the actions initiated last year will be continued in the area of
cross media, ad networks (an ad network, as a kind of sales
intermediary, represents multiple websites and the associated target groups to advertisers) and the realisation of further
synergy within the ad sales for national titles. In the area of
digital ads, new techniques and billing models are emerging
in rapid succession. Further attention will be devoted to organising ad sales for mobile telephones and tablets in 2011.
The initiated self-service-related actions will be continued.
TMG has high expectations of the e-commerce activities.
In addition, TMG remains alert to its cost structure in which
the flexibilisation of costs, including printing and distribution
costs, remains of key importance.
‘The declining return related to traditional activities cannot be
offset on a timely basis by (growing) digital activities’
Investment in digital initiatives will continue through acquisitions on the one hand and the development of new products by Keesing Games and InfoPinnacle, for example, and
the renewal of sites such as Relatieplanet, on the other hand.
The New Business Fund will be expanded with new initiatives that are consistent with TMG’s strategy in 2011.
Furthermore, synergy will be realised with Hyves. As such,
Hyves will be used for launching the games of the Keesing
Media Group. Digital knowledge and capacity is essential
to TMG. Attracting and retaining employees with knowledge of digital markets will be a point of focus in further
actions.
‘Control on the distribution platform of digital competitors is
being lost’
The traditional physical distribution of newspaper content
is partially shifting to digital distribution to a large number
of different devices and via different networks. On the one
hand this creates opportunities because digital distribution
makes the delivery of content simpler, faster and cheaper.
However, this also creates threats because distribution to a
large extent is not in the hands of the owners and suppliers
of that content. The latter also applies to TMG. Direct control
over the way in which content is made accessible is reduced,
which creates risks related to copyright and commerce.
For advertisers, efficiently reaching target groups on the
basis of target group analyses in particular is essential.
The question ‘whose client is this?’ plays an important role in
this regard. For TMG it is therefore important that the organisation has and maintains proper insight into the impact that
this change in distribution brings with it and also anticipates
the opportunities available to it to continue to exercise control over client data and conditions.
35
‘The continuity and reliability of ICT and other processes, data
and systems is being endangered’
Contrary to earlier plans/project plans, the structuring of
the new ICT organisation is now further being realised in
the line. A great deal of effort is being made on improving
connectivity. This project will be implemented in 2011.
With the set up of the Group Information Management Office,
a start has been made on further professionalising the ICT
function within TMG. In addition, activities have been started
up to further rationalise applications, as well as various upgrade projects.
financial fisks
Market, credit, liquidity, foreign exchange and interest rate risks.
For a more detailed description and quantification of the
abovementioned financial risks and the management of these
risks, please see page 85 of the financial statements.
other risks
The key strategic and financial risks are identified in the annual
report. Operational and compliance risks were assessed as less
severe than the key strategic and financial risks during the risk
analyses. Consequently, these risks are not summarised here.
In summary, a number of operational risks is influenced by
the change to more of a coordinating organisation, due to the
outsourcing of activities. This requires different management
and knowledge for which new risk analyses must be conducted. The changed risks are specifically identified within the
organisation, but for the time being are considered manageable.
An additional activity that will be carried out in this area this
year is a separate risk analysis of the ICT coordinating management function.
In terms of compliance, many activities were undertaken in
recent years. In renewing activities, such as the games of
Keesing Media Group, the risks related to applicable laws and
regulations are taken into consideration.
36
in control statement
executive board – statement of responsibility / in control statementt
in compliance with Section 5:25c subsection 2c of the Financial
Supervision Act (Wft), the Executive Board declares that:
1.1.the financial statements provide a true and fair view of the
assets, liabilities, financial position and the profit or loss of
the publishing institution and the companies jointly included
in the consolidation; and
2.the annual report presents a true and fair view of the position on the balance sheet date, the performance during the
financial year of the publishing institution and that of its affiliated companies, the figures of which are included in its
financial statements, and that the annual report describes
the material risks facing the publishing institution.
in compliance with best practice provision II.1.5 of the Code, the
Executive Board declares that:
the Executive Board is of the opinion that the internal risk
management and control systems as described in this annual
report provide a reasonable degree of assurance that the financial reporting does not contain any material misstatements
and that these systems functioned as expected during the
financial year.
Executive Board Telegraaf Media Groep N.V.
H.M.P. van Campenhout - CEO (as of 16 February 2011)
F.Th.J. Arp - CFO
P.M. Morley - COO
A.J. Swartjes (CEO up to 16 February 2011)
37
corporate governance
best practices
The Executive Board and the Supervisory Board support the
principles of the Corporate Governance Code (effective 1 January 2009).
In this section, TMG provides an explanation of its deviations
from the Code. In the special general meeting of TMG on
7 December 2010, the shareholders approved a number of
adjustments to the remuneration policy of the Executive
Board. Due to these adjustments and new legislation, a number
of ‘explain’ elements no longer apply. The so-called corporate
governance statement, including the comprehensive ‘comply
or explain’ summary concerning TMG’s Code is available at
www.tmg.nl under ‘Corporate Governance’.
Deviations from the Corporate Governance Code:
best practice provision III.3.5
Maximum term of office for Supervisory Board members.
This provision is not adhered to. It is noted that many positions in society are occupied for longer periods. Experience
and expertise are extremely important. The connection with
and knowledge of the company prevail.
principle III.5 / best pactice provisions III.5.6 and III.5.11
Composition and role of the key committees of the Supervisory
Board.
The Code states that if the Supervisory Board consists of more
than four members, it shall appoint an audit committee, a remuneration committee and a selection and appointment committee. The current Supervisory Board has four members (six
seats). The audit and remuneration committee consists of all
members of the Supervisory Board. In view of the commitment
and wide-ranging expertise of the members and the nature and
scope of the company, such core committees consisting of only
part of the Board will not be appointed. The Supervisory Board
Chairman is also the chairman of the audit and remuneration
committee. If necessary a selection and appointment committee will be composed ad hoc.
best practice provision IV.1
To the best of its ability, the company enables shareholders to
vote and communicate with all (other) shareholders by proxy.
TMG does not allow shareholders to vote by proxy in the General Meeting of Shareholders. In principle, shareholders should
attend the meeting in order to be able to discuss matters with
other shareholders present and so form an opinion.
best practice provision IV.2.8
Proxies.
It is possible for the management of the Trust Office to issue
proxies to depositary receipt holders, even during times of war.
The practice of binding voting instructions from a depositary
receipt holder to the management is not supported, as the
Board is of the opinion that that those wishing to vote ought to
be present at the general meeting of shareholders. Holders of
depositary receipts can freely convert their depositary receipts
into shares in order to obtain voting rights.
Webcasting, etc., of meetings with analysts, presentations to
analysts, presentations to investors and institutional investors
and press conferences.
This provision is not adhered to as regards ’one-on-one’ meetings. However, group presentations can be viewed via webcasts (www.tmg.nl). After they are given, presentations will be
posted on the group’s website.
Material changes in the company’s Articles of Association and
proposals to appoint managing directors and supervisory directors must be proposed separately to the general meeting.
TMG is a statutory two-tier entity. The Executive Board is appointed by the Supervisory Board. The Supervisory Board
notifies the shareholders of a proposed appointment.
corporate governance takeover directive
For additional information on this subject visit www.tmg.nl,
under the section ‘Corporate Governance’.
38
sustainability report
vision
As a media business operating at the heart of society, TMG not
only encounters a growing demand for reporting on sustainability among media consumers, but also a growing demand
among other interested parties for insight into the economic,
as well as social and environmental impacts of business operations.
TMG is convinced that a carefully considered policy for corporate social responsibility (CSR) not only reduces negative
impacts on the environment, but also leads to savings through
the more efficient use of natural resources, innovations in the
operating, commercial and editorial fields, client appreciation
and motivated employees.
TMG therefore strives to reduce the negative effects of business operations, while at the same time increasing the positive
impact, where possible.
objective
The CSR policy that was initiated in 2009, in the first instance
concentrates on reducing TMG’s environmental impact.
The company’s objective is to reduce CO2 emissions in
the next three to five years by 40% in comparison to 2010.
This objective is related to the CO2 emission of office buildings, printers and in-house managed transportation (Scope 1
and 2 as defined in the Greenhouse Gas Protocol) plus CO2
emissions from business travel by air.
cordance with the guidelines of the Global Reporting Initiative
(GRI), starting with the 2010 financial year. This way all interested parties are provided with an integral picture of the results achieved in the area of sustainable environmental policy,
as well as responsible social policy. Steps were taken in 2010 to
comply with the GRI guidelines. This process had not yet been
completed when this report was published.
climate footprint
A methodology designed to properly measure TMG’s impact on the environment was developed in 2009 and 2010.
This has resulted in the availability of a climate footprint in
2010, of sufficient quality and precision for possible inclusion
in the annual report. The methodology will be subjected to
further improvements for the purpose of achieving more direct control over environmental impacts.
The footprint contains the direct, business operations-related
emissions of all TMG business units in the Netherlands and
abroad, with the exception of Hyves. This business unit will be
incorporated starting in 2011. Activities in which TMG has a less
than 50% interest are not included.
climate footprint TMG 2010
breakdown by source
Electricity
Natural gas
In 2010, the emissions directly related to business operations plus business travel by air amounted to 24,000 tonnes
of CO2. TMG wants to achieve the targeted CO2 reduction
by increasing energy efficiency and by making use of sustainable energy where possible. In addition, TMG is striving
for the most efficient possible use of water and limiting and
recycling waste streams.
TMG realises that its business operations, in addition to direct
environmental impact, also result in indirect environmental
impacts, including the consumption of water, energy and
wood in the production of purchased paper and the consumption of fuel by outsourced transportation operations.
TMG also strives to reduce the impact within the chain where
possible and to include sustainability performance as a structural criterion in the selection of suppliers.
In last year’s annual report, TMG indicated its intent to
report on the results achieved in the area of sustainability in ac-
Fuel
24%
49%
27%
Classified by origin, half of the total of 24,000 tonnes of CO2
emissions is due to the generation of the electricity consumed
by TMG, a quarter is due to the consumption of natural gas and
another quarter is due to the fuel used for transport. Of the electricity consumed by TMG, 4% is green power.
39
climate footprint TMG 2010
of energy, water and paper consumption, and where possible
uses occasions when replacements are due, for this purpose.
breakdown by function
Offices
7%
Printing
42%
17%
facilities
In 2010, Sky Radio Group replaced all traditional lighting in its
offices with energy saving lighting. In addition, it fully converted
to green power. HDC Media in Alkmaar last year optimised it climate control installations as a measure for counteracting unnecessary energy consumption in cooling its buildings.
Transport
personnel
Distribution
34%
The double glazing in TMG’s largest office building in Amsterdam is being replaced to as much as possible avoid energy loss.
The cooling installations have been optimised in several areas
for the purpose of lowering energy consumption.
In 2011, collaboration in the area of daily newspaper distribution
with Wegener and NDC is expected to result in lower energy
consumption by distribution points.
Classified by function, 34% of TMG’s direct CO2 emissions
are attributed to in-house printing presses, 42% is due to the
energy consumed by offices and in-house data centres, 17% is
attributed to the personal transportation of TMG employees
(including business travel by air) and 7% is attributed to the
distribution of publications by TMG itself.
water, waste and recycling
Water plays a key role, for cooling buildings, as well as for use in
sanitary facilities and in support of the printing process. TMG in
2010 consumed 51 million litres of water in total: 45 million litres
for cooling and for use in sanitary facilities in TMG’s own offices
and printing facilities, and over 5 million litres for the in-house
printing of newspapers.
6,700 tonnes of waste are produced by in-house managed
processes, printing processes and buildings. The distribution is 92% paper waste (primarily paper used for adjusting
the printing presses), 6% residual waste, 1% hazardous waste
(from ink filtered from water and chemicals used in the printing process) and 1% glass and foil (packaging materials for
newspapers and paper). 93% of the waste (paper, glass and
foil) is fully recycled. The 6% residual waste is 80% reused for
the production of fuel pellets. The hazardous waste is incinerated by a waste plant specifically designed for this purpose.
offices and ICT
As is evident from the information above, offices are the largest
source of direct, business operations-related CO2 emissions.
TMG strives to make continuous improvements in the efficiency
Due to the growing share of digital services in TMG’s activities,
the need for data Center capacity is growing as well. TMG strives
to as much as possible control the environmental impact of cooling and energy consumption in data Centers. In any outsourcing of data Centers, the energy efficiency of external suppliers is
specifically taken into consideration.
A printer policy was also developed in 2010, and work on replacing individual printers by centrally located multifunctional printers that are as standard configured to print black and white and
double-sided has started.
printing process and paper
The printing of newspapers, magazines and puzzle books
is TMG’s second principal source of direct, business operations-related environmental impact. As indicated earlier, the two in-house printers account for 34% of TMG’s
climate footprint, primarily due to the printing presses’ power
consumption.
In 2010, the printer in Alkmaar implemented a new printing
press control system. In the coming years, the printer in Amsterdam will convert its printing presses. This will also include
the installation of a new control system. These measures are expected to result in a more efficient use of water, energy, paper
and ink. TMG’s indirect environmental impact is much greater
than its direct impact due to the quantity of water, fuel and
energy required for the production of the 106,000 tonnes of
paper purchased annually. The origin of the wood pulp used is
also a key environmental factor due to the issue of responsible
forest management.
40
In 2010, TMG procured its paper from renowned paper producers in Europe, in particular from factories in the Netherlands,
Belgium, the United Kingdom, Sweden and Norway. The newspaper paper purchased – over 80% of the total – was more than
half produced from recycled paper.
Keesing Media Group, a publisher of puzzle books, in 2011 will
fully convert to the use of paper carrying the sustainability
quality mark FSC or PEFC. Keesing has placed the orders for
certified paper, works with certified printers and as a company
has applied for FSC and PEFC certification.
transport and distribution
Almost 300,000 km were travelled from the paper producers
to TMG’s printers in Alkmaar and Amsterdam: a third by boat
and the rest by truck.
Furthermore, it is estimated that 34.5 million kilometres were
driven in 2010 - with trucks, delivery vans and cars - to transport
all publications from the printers to the distribution points and
shops. TMG has terminated its own transportation operations
and now exclusively works with external transporters. The very
last segment of the distribution chain is largely covered by bicycle: It is estimated that 25 million clean kilometres are driven
by bicycle each year in 12,000 newspaper districts.
TMG uses its coordinating role in the distribution process to
as much as possible limit the number of kilometres driven.
This results in cost savings, and also reduces emissions from
fuel consumption. This is accomplished in two ways: by optimising routes and by combining transport.
Various route optimisations have reduced the number of kilometres travelled by around 800,000 kilometres. By combining transport with Wegener and NDC – a project that is currently being
implemented – it is estimated that an annual reduction of 9 million kilometres can be achieved. Both reductions in the number of
kilometres travelled result in a reduction in CO2 emissions.
staff mobility
The sustainable leasing policy for passenger cars went into
effect in 2010. The available options for newly to be acquired
lease cars is limited to cars with an A, B or C rating (the most fuel
efficient options). In addition, TMG incentivises the selection of
clean passenger cars by awarding a bonus. Further refinement
is being considered, depending on the level of support for the
new policy.
sustainable procurement
On procurement, the supplier’s policy related to corporate
social responsibility (CSR) is included as a standard selection
criterion for new, as well as existing contracts. This is resulting
in a growing group of preferred suppliers with a strong CSR
profile, such as catering, waste management, office supplies,
car leasing and temporary agency work.
Where possible, efforts are made to further define the CSR
policy’s content in collaboration with suppliers. An agreement
has been negotiated with Adecco this year, stipulating that
temporary agency staff working for TMG will in principle only
be compensated for public transportation or bicycle kilometres
and must be living within a limited radius of their location of
work. In the area of energy, the opportunities for making greater use of green power will be identified this year.
news and reporting on sustainability
TMG wants to make a contribution to informing the public at
large in a critical and practical way about sustainability themes.
Although this subject has formed part of reporting for some
time, an important step was made in 2010 with the launch of
the De Groene Telegraaf (the ‘Green Telegraph’). Each week,
two pages with sustainability-related news are being offered in
De Telegraaf on Saturdays.
A recent appreciation survey shows that the De Groene
Telegraaf fulfils an important readers’ need. The pages are
not only read by hundreds of thousands of readers every week,
the content’s level of appreciation is high as well. A previous
reader survey already highlighted the fact that Telegraaf readers attach a great deal of importance to the CSR policy pursued by the companies where they purchase their products.
TMG will continue to pursue this track this year, and, in addition
to the De Groene Telegraaf will also publish specials related to
sustainability themes. Furthermore, this spring, the first winner
of the Top 100 Green Companies competition organised last
year, will be selected.
TMG financial statements 2010
Always accessible. Anyone can do whatever needs to be done for work
or personal purposes, anywhere and at any time. The use of mobile
applications is developing at a breakneck pace. This is why we are
always present everywhere with our media and brands.
45
consolidated statement of
comprehensive income
Note
2010
2009
Continued operations
592,297 423 592,720 611,840
2,902
614,742
Raw and auxiliary materials
6
44,377 Personnel costs
7
216,200 Depreciation
8
13,652 Amortisation and impairment
8
37,650 Other operating expenses
9
258,399 Total operating expenses
570,278 22,442 Operating result
52,556
228,646
15,916
46,193
274,301
617,612
Result from associates
10
65,078 Financial income
10
1,298 Financial expenses
10
-1,698
Financial income and expenses
64,678 87,120 Result of continued operations, before tax
63,827
713
-1,802
62,738
6,159 80,961 907
58,961
Result of discontinued operations
13
-
Gain on sale of discontinued operations, net of tax
Net result for the year (realised)
80,961 10,365
69,326
-
80,961 594
69,920
Net result attributable to:
81,826 Shareholders of Telegraaf Media Groep N.V.
Non-controlling interests
-865
80,961 70,505
-1,179
69,326
Comprehensive income attributable to:
81,826 Shareholders of Telegraaf Media Groep N.V.
-865
Total comprehensive income for the year
80,961 71,099
-1,179
69,920
Earnings per share
Net result attributable to shareholders of ordinary
24
81,826 shares Telegraaf Media Groep N.V.
Weighted average number of ordinary shares
24
47,750,000 Basic and diluted earnings per share (EUR)
1.71 Basic and diluted earnings continued operations per share (EUR)
1.71 70,505
47,750,000
1.48
1.26
Revenues
4
Other operating income
5
Total income
Income tax
11
Result of continued operations
Other comprehensive income for the year, net of tax
-2,870
59,868
46
consolidated statement of financial position
as at 31 December
Note
2010
2009
ASSETS
Non-current assets
Intangible assets
14
396,898 Property, plant and equipment
15
52,056 Investments in associates
16
199,436 Deferred tax assets
28
4,632 Other receivables
17
3,963 Total non-current assets
656,985 Current assets
18
7,401 Inventories
Tax receivables
12
428 Trade and other receivables
19
80,555 Cash and cash equivalents
20
39,584 Assets classified as held for sale
21
11,728 Total current assets
139,696 796,681 Total assets
381,360
60,646
136,976
10,633
5,907
595,522
14,736
352
80,798
56,506
14,882
167,274
762,796
Equity and liabilities
Shareholders’ equity
Issued capital
11,938 Other reserves
519,137 Attributable to equity holders Telegraaf Media Groep N.V.
22 531,075 11,938
454,024
465,962
2,477 533,552 3,335
469,297
Liabilities
25 16,654 Interest-bearing loans and borrowings
Post-employment benefit liabilities
26
23,336 Restructuring provisions
27
1,973 Deferred tax liabilities
28
27,691 Total Non-current liabilities
69,654 18,618
26,932
7,657
25,702
78,909
Total shareholders’ equity
Interest-bearing loans and borrowings
25
1,393 Accounts payables and other current liabilities
29
170,142 Restructuring provisions
27
14,212 Tax payables
12
7,728 Liabilities classified as held for sale
21
-
Total Current liabilities
193,475 263,129 Total liabilities
796,681 Total equity and liabilities
11,828
173,385
19,507
7,287
2,583
214,590
293,499
762,796
47
consolidated statement of cash flows
In thousands of euros Note
2010
2009
Cash flow from operating activities
80,961 69,326
Adjustments for:
15
13,652 Depreciation of property, plant and equipment Amortisation of intangible assets 14
37,650 Impairment losses intangible assets 14
-
Impairment losses property, plant and equipment
15
-
Net financing costs 10
400 Share in result investments accounted for according to the ‘equity’ method 10
-18,375 Reversal on impairment losses
10
-43,800 Gain on sale of property, plant and equipment
5
-423 Gain on sale of non-current financial assets 10
-35 Gain on sale of discontinued operations, net of tax 10, 13
-2,868 Income tax 11
6,159 73,321 Change in inventories
7,335 Change in trade and other receivables 5,414 Change in prepayments -1,571 Change in accounts payable and other current liabilities -7,720 Change in provisions and post-employment benefit liabilities -14,654 62,125 Interest received (paid)
611 Income taxes paid
-3,167 Net cash from operating activities
59,569 16,193
37,664
8,633
55
2,315
-8,267
-56,000
-2,607
440
-8,072
-6,049
53,631
3,626
12,895
-4,898
2,297
-28,321
39,230
-565
10,587
49,252
Cash flows from investing activities
14
-4,555 Investments in intangible assets
Investments in property, plant and equipment
15
-4,723 Acquisition of subsidiaries, net of cash acquired
3
-43,738 Acquisition of associated companies
-497 Divestment of associated companies
35 Divestment of other investments
-
Disposal of operation, net of cash disposed of
13
3,210 Divestments of property, plant and equipment
1,122 Net cash from (used in) investing activities
-49,146 -7,005
-4,161
-3,010
-602
35
500
2,036
14,826
2,619
Cash flows from financing activities
23 -16,713 Dividends paid
Withdrawal of borrowings
419 Redemption of borrowings
-12,867 Change in non-controlling interests
7
Net cash from (used in) financing activities
-29,154 -16,713
76
-14,263
1,245
-29,655
Net increase (decrease) in cash and cash equivalents
-18,731 22,216
20 21 20 56,506 1,809 39,584 33,592
698
56,506
Net result for the year
Cash and cash equivalents at 1 January
Change in cash classified as held for sale
Cash and cash equivalents at 31 December
48
consolidated statement of changes in equity
Attributable to equity holders of Telegraaf Media Groep N.V.
Trans-
Non- Total share
Issued
lation
Treasury
Retainedcontrolling
holders’
Note
capital
reserve
shares
earnings
Total interests
equity
Balance at 1 January 2009
12,500
-594
-53,194
452,864
411,576
3,269
414,845
Other comprehensive income
22
Total comprehensive
income for the year
-
-
-
594
-
-
70,505
-
70,505
594
-1,179
-
69,326
594
-
594
-
70,505
71,099
-1,179
69,920
Dividends paid to shareholders
23
Repurchase of own shares 22
Change in non-controlling interests
Balance as at 31 December 2009
-
-562
-
11,938
-
-
-
-
-
53,194
-
-
-16,713
-52,632
-
454,024
-16,713
-
-
465,962
-
-
1,245
3,335
-16,713
1,245
469,297
Other comprehensive income
22
Total comprehensive
income for the year
-
-
-
-
-
-
81,826
-
81,826
-
-865
-
80,961
-
-
-
-
81,826
81,826
-865
80,961
Dividends paid to shareholders
23
Change in non-controlling interests
-
-
11,938
-
-
-
-
-
-16,713
-
519,137
-16,713
-
531,075
-
7
2,477
-16,713
7
533,552
49
notes to the consolidated financial statements
contents
page
50
60
62
64
64
64 64
65
65
65
66
67
67
69
71
72
74
74
note
1.Significant accounting policies
2. Segment reporting
3. Business combinations
4. Revenues
5. Other operating income
6. Raw and auxiliary materials
7. Personnel costs
8.Depreciation, amortisation and impairment
9. Other operating expenses
10. Financial income and expense
11. Income tax
12. Current tax assets and liabilities
13. Discontinued operations
14. Intangible assets
15. Property, plant and equipment
16. Investments in associated companies
17. Other receivables
18. Inventories
page
75
75
76
76
77
77
78
79
82
83
84
85
87
88
88
88
89
89
note
19. Trade and other receivables
20.Cash and cash equivalents
21. Assets and liabilities held for sale
22. Shareholders’ equity
23. Dividend
24.Earnings per share
25.Interest-bearing loans and borrowings
26.Post-employment benefit liabilities
27. Restructuring provision
28. Deferred tax assets and liabilities
29.Accounts payable and other current liabilities
30.Financial risk management
31. Off balance sheet liabilities
32. Investment commitments
33. Contingent liabilities
34.Related parties
35. Interests in joint ventures
36.Subsequent events
50
1.
significant accounting policies
corporate information
Telegraaf Media Groep N.V. (the ‘Company’) domiciled in
Amsterdam, the Netherlands is a media company with a leading market position and recognized brands in the Netherlands.
The activities primarily are the publication of printed media
and the operation of, and participation in, digital media, radio
and television. The company’s shares are listed on the NYSE
Euronext in Amsterdam.
The consolidated financial statements of the Company for the
year ended 31 December 2010 comprise the company and its
subsidiaries (together referred to as TMG) and jointly controlled
entities and TMG’s interest in associates.
The financial statements have been compiled by the Executive
Board, and have together with the Supervisory Board been
signed on 10 March 2011.
statement of compliance
The consolidated financial statements have been prepared
in accordance with the International Financial Reporting
Standards (IFRS) as adopted by the International Accounting Standards Board (IASB) and as adopted by the European
Union, and the interpretations of these standards by the IASB.
basis for preparation
The financial statements are presented in euros, rounded to the
nearest thousand.
Non-current assets and disposal groups held for sale are stated
at the lower of the carrying amount and the fair value less costs
to sell. The principles for the valuation of assets and liabilities
and the determination of the result of the company financial
statements of Telegraaf Media Groep N.V., are in conformity
with article 402, Book 2 of The Netherlands Civil Code.
changes in accounting policies
The accounting policies have been applied consistently for the
years 2010 and 2009 as presented in these consolidated financial statements. As a consequence of a change in IFRS standards the following change in accounting policy has applied:
business combinations
As of 1 January 2010 IFRS 3 (revised) ‘Business combinations’
became effective. The changes have consequences for the valuation of minority interests, transaction costs incurred (direct in
result), valuation and recognition after acquisition of contingent
consideration and step acquisition. The changes have an impact
on the recognition of goodwill and reported results within the
period an acquisition incurred and prospective reported results.
The change in accounting policy is applied prospectively and
had no material impact on TMG’s financial position.
In 2010 TMG acquired 100% of the shares of Hyves. The change
in accounting policy, as a consequence of this acquisition, has
no significant impact on the financial position. For more disclosure see note 3.
consolidated and s eparate financial statements
As of 1 January 2010 IAS 27 (amended) ‘Consolidated and
Separate financial statements’ became effective. Under the
new accounting policy, changes of non-controlling interests are
accounted for as transactions with equityholders in their capacity as equityholders and therefore no goodwill is recognised as
a result of such a transaction. Previously, goodwill was recognized arising on the acquisition of a non-controlling interest in
a subsidiary.
The change in accounting policy is applied prospectively and
had no material impact on TMG’s financial position.
changes in presentation
The discontinued operations have in 2009 an effect on the
financial position of TMG. The presentation of the statement of
comprehensive income is primarily based on continued operations. The presentation of, and certain terms used in, the statement of financial position, statement of comprehensive income
and certain notes has been changed in 2010 to provide additional and more relevant information.
Certain comparative amounts have been reclassified to conform to the current period presentation. None of the changes
are significant.
critical accounting estimates and judgements
In the process of applying TMG’s accounting policies, management has made judgements, estimates and assumptions,
which affect the application of the accounting principles and
the amounts recognised in the financial statements. The estimates and the related assumptions are based on historical
experience and other factors that are believed to be reasonable under the circumstances. The outcomes of these form
the basis for the evaluation of the carrying value of assets
and liabilities where this is not easily apparent from other
sources.
The estimates and underlying assumptions are reviewed on an
ongoing basis. Revisions of the estimates are applied in the pe-
51
riod during which the estimate is revised, if the revision only
has consequences for the period in question. If the revision has
consequences for both the period under review and future periods, the estimate is revised in both the period of revision and
future periods.
The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to
the consolidated statements are:
• intangible assets (useful life and impairment - see note 14);
• property, plant and equipment (useful life - see note 15);
• associated companies (impairment - see note 16);
• trade receivables (impairment - see note 19);
• post employment benefit liabilities (actuarial assumptions
- see note 26);
• restructuring provision (the amount of severance payments
and severance alternatives - see note 27);
• income tax (rate and recoverability deferred tax - see note 28).
Judgements made by management in the application of IFRS
that have significant effect on the financial statements and estimates with a significant risk of material adjustment in the next
year are discussed in the accompanying notes.
basis of consolidation
The consolidated financial statements of Telegraaf Media Groep
N.V. comprise the company and all of its subsidiaries and joint
ventures. The consolidation is based on the valuation and the
accounting principles of the parent company.
subsidiaries
Subsidiaries are entities controlled by the Company. Control
exists when the Company has the power, directly or indirectly,
to govern the financial and operating policies of an entity so
as to obtain benefits from its activities. In assessing control,
potential voting rights that presently are exercisable or convertible are taken into account. The financial statements of
subsidiaries are included in the consolidated financial statements from the date that control commences until the date
that control ceases.
associated companies
Associates are those entities in which TMG has a significant
influence, but no control, over the financial and operating
policies. Subsidiaries and joint ventures are no associated
companies. The consolidated financial statements include
TMG’s share of the total recognised gains and losses of associates on an equity accounted basis, from the date that
significant influence commences until the date that significant
influence ceases.
TMG’s investment includes goodwill identified on acquisition,
net of any accumulated impairment losses. The consolidated
financial statements include TMG’s share of the income and
expenses and equity movements of equity accounted investees, after adjustments to align the accounting policies with
those of TMG, from the date that significant influence or joint
control commences until the date significant influence or joint
control ceases. Impairment is accounted for immediately in
the statement of comprehensive income. When TMG’s share
of losses exceeds its interest in the associate, the carrying
amount is reduced to nil and recognition of further losses is
discontinued except to the extent that TMG has incurred legal
or constructive obligations or made payments on behalf of
an associate.
transactions eliminated on consolidation
Intra-group balances and any unrealised gains and losses or
income and expenses arising from intra-group transactions are
eliminated in preparing the consolidated financial statements.
Unrealised gains arising from transactions with associates and
jointly controlled entities are eliminated to the extent of TMG’s
interest in the entity. Unrealised losses are eliminated in the
same way as unrealised gains, but only to the extent that there
is no evidence of impairment. The results of the subsidiaries
acquired or disposed of during the financial year are included
in the consolidated financial statements as of or till the effective transaction date. If necessary, changes are made to the
figures of subsidiaries to align the accounting principles with
those of TMG.
foreign currency
joint ventures
Joint ventures are those entities established by contractual
agreement over whose activities TMG has joint control and
in which strategic decisions are taken by unanimous consent.
The consolidated financial statements include TMG’s proportional share of the entities assets, liabilities, revenues and expenses with items of a similar nature on a line-by-line basis,
from the date that joint control commences until the date that
joint control ceases.
foreign currency transactions
Transactions in foreign currencies are translated into euros
at the foreign exchange rate at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are translated to euros at the
foreign exchange rate ruling at that date. Foreign exchange differences arising on translation are recognised in the statement
of comprehensive income. Non-monetary assets and liabilities
52
that are measured in terms of historical cost in foreign currency
are translated at the exchange rate applying on the date of the
transaction. Non-monetary assets and liabilities denominated in
foreign currencies that are stated at fair value are translated to
euros at foreign exchange rates ruling at the dates the fair value
was determined.
financial statements of foreign operations
The assets and liabilities of foreign operations, including
goodwill and fair value adjustments arising on consolidation, are translated to euros at foreign exchange rates ruling at the balance sheet date. The revenues and expenses of
foreign operations are translated to euros at the date of the
transaction. Foreign exchange differences arising on translation are recognised directly in a separate component of equity.
Foreign exchange gains and losses arising from a monetary
item receivable from or payable to a foreign operation, the
settlement of which is neither planned nor likely in the foreseeable future, are considered to form part of a net investment in a foreign operation and are recognised directly in
equity in the translation reserve. When a foreign operation is disposed of, in part or in full, the relevant amount in
the translation reserve is transferred to the statement of
comprehensive income.
intangible assets
goodwill
Goodwill represents amounts arising on acquisitions of subsidiaries, joint ventures and associates.
In respect of acquisitions, goodwill represents the difference
between the cost of the acquisition and the fair value of the
identifiable assets liabilities and contingent liabilities acquired.
Goodwill is stated at cost less any accumulated impairment
losses.
Goodwill is attributed to cash generating units and is not amortised. Instead, it is tested annually for impairment (see accounting policy impairments). In respect of associates, the
carrying amount of goodwill is included in the carrying amount
of the investment in the associate. Whenever an interest in a
subsidiary, associate or joint venture is sold, the corresponding
goodwill is included in the determination of the result of the
transaction. Negative goodwill that arises during an acquisition
is included directly in the statement of comprehensive income.
Acquisitions of non-controlling interests are accounted for as
transactions with equityholders in their capacity as equityholders and therefore no goodwill is recognised as a result of such
transactions.
other intangible assets
Other intangible assets concern licences, (internally developed) software, trademarks and publishing rights. The other
intangible assets acquired by TMG are stated at cost less accumulated amortisation and impairment losses (see accounting
policy impairments). Expenditure for development activities,
whereby the research results are applied to a plan or design for
the production of new or substantially improved products and
processes, are capitalised if the product or process is technically and commercially feasible can be separately identified, the
expenses are estimated reliably, and TMG has sufficient
resources to complete the development.
The capitalised costs comprise the cost of material, direct
labour and an appropriate proportion of overheads. With regard to the capitalized internal hours, a legal reserve is stated.
Other development expenditure is recognised in the statement
of comprehensive income as an expense as incurred. Capitalised development expenditure is stated at cost less accumulated amortization and impairment losses.
subsequent expenditure
Subsequent expenditure on capitalised intangible assets is
capitalised only when it increases the future economic benefits
embodied in the specific asset to which it relates. In that
case, the costs are capitalised in so far as they increases the
economic benefits.
borrowing costs
Borrowing costs are capitalised on qualifying assets.
amortisation
Amortisation is charged to the statement of comprehensive
income on a straight-line basis over the estimated useful lives of intangible assets unless such lives are indefinite.
Other intangible assets are amortised from the date they are
available for use.
The estimated useful lives are as follows:
• trademarks and publishing rights 5 - 50 years
• licences 5 years
• software 3 - 5 years
The amortisation method and estimated useful lives are
assessed annually.
lease
Lease agreements, where TMG has substantially all the risks and
rewards of ownership are classified as financial leases. Upon initial recognition the leased asset is measured at an amount equal
53
to the lower of its fair value and the present value of minimum
lease payments. Subsequent to initial recognition, the asset is
accounted for in accordance with the accounting policy applicable to that asset. Other leases are operating leases, which assets are not recognised in TMG’s statement of financial position.
value less attributable transaction costs. They are then capitalised at amortised cost, whereby a difference between the
cost and the redemption amount on the basis of the effective
interest method is included in the statement of comprehensive
income over the duration of the receivables.
property, plant and equipment
inventories
Inventories are stated at the lower of cost or net realisable value. The net realisable value is the estimated selling price in the
ordinary course of business, less the estimated costs of completion and the selling expenses. The cost of the inventories is
based on the ‘first in, first out’ principle (FIFO) and includes
expenditure incurred in acquiring the inventories and bringing
them to their existing location and condition.
owned assets
Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses (see accounting
policy impairments). Property, plant and equipment that is being constructed or developed for future use is stated at cost
until construction or development is complete.
subsequent expenditure
TMG recognises in the carrying amount of an item of property,
plant and equipment the cost of replacing part of such an item
when that cost is incurred if it is probable that the future economic benefits embodied with the item will flow to TMG and
the cost of the item can be measured reliably. All other costs
are recognised in the statement of comprehensive income as an
expense when incurred.
securities
borrowing costs
Borrowing costs are capitalised on qualifying assets.
Other financial instruments held by TMG are classified as being
available for sale and are stated at fair value, with any resulting
gain or loss being recognised in the shareholders’ equity, except for impairment losses and, in the case of monetary items
such as debt securities, foreign exchange gains and losses.
depreciation
Depreciation is charged to the statement of comprehensive
income on a straight-line basis over the estimated useful life
of each part of a property, plant and equipment. Land is not
depreciated.
investments in debt instruments and shares
Financial instruments held for trading are classified as current
assets and are stated at fair value, with any gain and loss recognised in the statement of comprehensive income. When TMG has
the positive intent and ability to hold financial instruments to maturity, they are stated at amortised cost less impairment losses.
When these investments are derecognised, the cumulative gain
or loss recognised directly to the shareholders’ equity is recognised in the statement of comprehensive income.
The estimated useful lives are as follows:
• buildings 20 - 25 years
• machinery and equipment 5 - 10 years
• other tangible fixed assets 3 - 5 years
The depreciation method, estimated useful life and residual
value are assessed annually.
other receivables
Other receivables consist of prepaid operational leases and
non-current receivables. Participations, in which TMG has significant influence, are valued at fair value or at cost. Prepaid
operational leases comprise the purchased leaseholds of the
land of the campus of Amsterdam. These are amortised on
a straight-line basis over the duration of the leaseholds concerned. Non-current receivables are initially recorded at fair
Where these investments are interest-bearing, interest calculated using the effective interest method is recognised in the
statement of comprehensive income. The fair value of the financial instruments classified as held for trading and available for
sale is their quoted bid price at the balance sheet date.
Financial instruments classified as held for trading or available for sale investments are recognised by TMG on the date it
commits to purchase. Investments held to maturity are recognised on the day they are transferred to TMG and are removed
from the statement of financial position on the day they are
disposed of.
financial instruments
TMG uses none derivative financial instruments to hedge interest rate risk exposures. Embedded derivatives are separated
54
from the host contract and accounted for separately if the
economic characteristics and risks of the host contract and
the embedded derivative are not closely related, a separate instrument with the same terms as embedded derivative would
meet the definition of a derivative, and the combined instrument is not measured at fair value through the statement of
comprehensive income. Derivatives are recognised initially
at fair value; attributable transaction costs are recognised
in the statement of comprehensive income when incurred.
Subsequent to initial recognition, derivatives are measured
at fair value, and changes therein are accounted for in the
statement of comprehensive income. If the range of various
estimates in fair value of financial instruments is substantial
and the probabilities of the various estimates can not be reasonably assessed, the financial instrument is stated at cost instead of fair value less impairments, if any. TMG does not apply
hedge accounting.
trade and other receivables
Trade and other receivables are stated at cost less impairment
losses.
cash and cash equivalents
Cash comprises cash balances and call deposits.
impairments
The carrying amount of TMG’s assets other than inventories
and deferred tax assets, are reviewed at each balance sheet
date to determine whether there is an indication of impairment. If such indication exists, the asset’s recoverable amount
is estimated (see the policy for calculation of recoverable
amount).
ers’ equity, and there is objective evidence that the asset is
impaired, the cumulative loss that had been recognised
directly in equity is recognised in the statement of comprehensive income, even though the financial asset has been
derecognised.
The amount of cumulative loss that is recognised in the statement of comprehensive income is the difference between the
cost and the current fair value, less any impairment loss on
that financial asset previously recognised in the statement of
comprehensive income.
calculation of recoverable amount
The recoverable amount of TMG’s investments in securities
held to maturity and receivables valued at the amortised cost
of acquisition is calculated as the present value of the expected future cash flows, discounted at the original effective
interest rate (i.e. the effective interest calculated at the time at
which these financial assets are initially entered). Receivables
with a short residual term are not discounted to the present
value. For the other assets and associates, the realisable value
is the fair value less cost to sell, or the value in use if this is
higher. When determining the value in use the present value
of the estimated future flows is calculated using a pre-tax
discount rate that reflects both the current market valuations
of the time value of money and the specific risks related to the
asset. For an asset that generates no cash receipts which are
significantly independent of those of other assets, the realisable value is determined for the cash generating unit to which
the asset belongs.
Impairment losses are recognised in the statement of comprehensive income. Impairment losses recognised for cash
generating units are allocated first to reduce the carrying
amount of any goodwill allocated to cash-generating units
(or groups of units) and then to reduce the carrying amount
of the other assets in the unit (or groups of units) on a pro
rata basis.
reversal of impairment
An impairment loss for a security held to maturity or a receivable carried at amortised cost is reversed if the subsequent
increase in recoverable amount can be related objectively
to an event occurring after the impairment loss was recognised. Impairment loss on goodwill will not be reversed.
Impairments on non-quoted equity instruments (financial
instrument), that is not carried on fair value, because its
fair value cannot be reliably measured, will not be reversed.
In respect of other assets, an impairment loss is reversed if
there has been a change in the estimates used to determine
the recoverable amount. Impairment is only reversed to the
extent that the asset’s carrying amount does not exceed the
carrying amount that would have been determined, net of
depreciation or amortisation, if no impairment loss had been
recognised.
When a decline in the fair value of an available for sale financial asset has been recognised directly in the sharehold-
issued capital
TMG’s ordinary shares are designated as the Company’s equity.
For goodwill, assets that have an indefinite useful life and intangible assets that are not yet available for use, the recoverable
amount is estimated at each balance sheet date to determine
whether there is an indication for impairment. An impairment
loss is recognised whenever the carrying amount of an asset, or
the cash-generating unit exceeds its recoverable amount.
55
minority interests
Minority interests are the portion of the profit and loss and
net assets of a subsidiary attributable to equity interests that
are not owned, directly or indirectly through subsidiaries, by
TMG. In the event of both a written put and a call option on
the shares, these shares will be included in TMG’s economic
interest, and not classified as a minority interest. The remaining interest is classified as a liability, based on the most realistic estimate.
withdrawal shares
When share capital recognised as equity is repurchased, the
amount of the consideration paid, which includes directly attributable costs, is net of any tax effects and is recognised as a deduction from equity. For repurchased shares classified as treasury shares that are sold or reissued subsequently, the amount
received is recognised as an increase in equity, and the resulting surplus or deficit on the transaction is transferred to/ from
retained earnings. Withdrawn shares are deducted from issued
capital for nominal value, and the resulting surplus or deficit on
the transaction is transferred to/from retained earnings.
interest-bearing loans and borrowings
Interest-bearing loans and borrowings are recognised initially
at fair value. Subsequent to initial recognition, interest-bearing
loans are stated at amortised cost, with any difference between
cost and redemption value being recognised in the statement
of comprehensive income over the period of the borrowings on
an effective interest basis.
share-based remunerations
Share-based remunerations are valued at the (expected)
present value of the shares owned by the management at
vesting date. The grant date fair value of shares granted to
management is recognised and allocated to the period that the
management is unconditionally entitled to sell the shares to
TMG. Expenses are recognised when payment of shares is unconditional or realised.
In the event of both a written put and a call option on the shares,
these shares will be included in TMG’s economic interest. At the
same time, a management obligation is included. The valuation is the discounted fair value of the shares at vesting date.
Estimates of fair values are reassessed annually.
post-employment benefit liabilities
TMG has established various pension schemes, some under its
own management, with Stichting-telegraaf-pensioenfonds 1959
and some placed with external parties such as industry wide
pension funds and insurance companies.
a. defined benefit plans
TMG’s net obligation in respect of defined benefit plans is calculated separately for each scheme by estimating the amount
of future benefits that employees have earned in return for
their service in the current and prior periods. That benefit
is discounted to determine its present value. Any unrecognised past service costs and the fair value of plan assets are
deducted hereon. The discount rate is the yield as at the balance sheet date on AAA credit rated bonds that have maturity dates approximating to the terms of TMG’s obligations.
The calculation is performed by a certified actuary using the
‘projected unit credit’ method. In respect of actuarial gains and
losses that arise while calculating TMG’s obligation in respect
of a plan, to the extent that any cumulative unrecognised
actuarial gain and loss exceeds 10 per cent of the greater of
the present value of the defined benefit obligation and the fair
value of plan assets, that portion is recognised in the statement
of comprehensive income over the expected average remaining working lives of the employees participating in the plan.
Otherwise, the actuarial gain and loss is not recognised.
Where the calculation results in a benefit to TMG, the recognized asset is limited to the net total of any unrecognised
actuarial losses and past service costs and the present value
of any future refunds from the plan or reductions in future
contributions to the plan. When the benefits of a plan are
improved, the portion of the increased benefit relating to
past service by employees is recognised as an expense in the
statement of comprehensive income on a straight-line basis
over the average period until the benefits become vested.
To the extent that the benefits vest immediately, the expense is recognised immediately in the statement of comprehensive income.
The result ensuing from the curtailment or termination of a
defined benefit plan is incorporated in the statement of comprehensive income immediately when the curtailment or
termination exists. The result consists of the change in the
present value of the defined benefit obligation and the fair
value of plan assets and previous actuarial results and past
service costs which have not been accounted for. A curtailment exists if there is a material reduction in the number of
employees covered by the pension plan or if the plan changes
substantially.
b. defined contribution plans
Obligations for contributions to defined contribution plans are
recognised as an expense in the statement of comprehensive
income as incurred. Industry wide pension funds of which no
reliable information is available, are stated as a defined contribution plans.
56
provisions
A provision is recognised in the statement of financial position when TMG has a present legal or constructive obligation
as a result of a past event and it is probable that an outflow of economic assets will be required to settle the obligation. If the effect is material, provisions are determined by
discounting the expected future cash flows at a pre-tax rate
that reflects current market assessments of the time value of
money and, where appropriate, the specific risks related to
the liability..
restructuring provision
A provision for restructuring is recognised when TMG and the
works council have approved a detailed and formalised restructuring plan and the restructuring has either commenced or has
been announced publicly. TMG has no possibility to withdraw
the reorganisation plan. Termination benefits are recognised
as an expense when TMG is demonstrably committed to either
terminating the employment of current employees and/or function categories.
To the extent they can be reliably estimated, benefits falling
due more than 12 months after the balance sheet date are discounted to their present value.
accounts payable and other current liabilities
Accounts payable and other current liabilities are stated at cost.
determination of fair values
A number of TMG’s accounting policies and disclosures require
the determination of fair value, for both financial and non-financial assets and liabilities. Fair values have been determined for
measurement and/or disclosure purposes based on the following methods. When applicable, further information about the
assumptions made in determining fair values is disclosed in the
notes specific to that asset or liability.
The fair value of property, plant and equipment recognised as
a result of a business combination is based on market values.
The market value of property is the estimated amount for which
a property could be exchanged on the date of the valuation
between a willing buyer and a willing seller in an arm’s length
transaction after proper marketing wherein the parties had each
acted knowledgeably, prudently and without compulsion. The
market value of items of other plant, equipment, fixtures and
fittings is based on the quoted market prices for similar items.
intangible assets
The fair value of publishing rights and trademarks acquired
in a business combination is based on the discounted esti-
mated royalty payments that have been avoided as a result
of the patent or trademark being owned. The fair value of
other intangible assets is based on the discounted cash flows
expected to be derived from the use and eventual sale of
the assets.
The fair value of trade and other receivables is estimated as the
present value of future cash flows, discounted at the market
rate of interest at the reporting date.
derivatives
The fair value of interest rate swaps is based on broker quotes.
Those quotes are tested for reasonableness by discounting estimated future cash flows based on terms and maturity of each
contract and using market interest rates for similar instruments
at the measurement date.
share based payment transactions
The fair value of share based payment transactions is based on
the expected cash value of the cash flow from the subsidiary.
Factors affecting valuation include strike price of the instrument, the expected cash flow from the entity and the discount
rate.
revenue
The revenues exclude value added tax and after discounts.
Revenues from the sale of goods are recognised in the statement of comprehensive income when the significant risks and
rewards of ownership have been transferred to the buyer.
Revenues relating to services provided are included in the
statement of comprehensive income in proportion to performance in the same financial year.
No revenue is recognised if there are significant uncertainties
regarding recovery of the consideration due, associated costs
or the possible return of goods, or when there is continuing
management involvement with the goods.
barter transactions
If advertisement space or time are exchanged or swapped
for advertisement space or time which are similar as regards
the nature, fair value and same target population, such an
exchange is not recognised as a revenue-generating transaction. If this condition is not applicable, the exchange will
be regarded as a transaction which generates revenue.
The amount of the revenue is determined on the basis of the fair
value of the goods or services received, plus or minus any cash
or assets which have been received or paid which can be converted into cash, on short term. If the fair value of the received
goods or services cannot be reliably determined, the revenue
57
is determined on fair value of the exchanged goods or services
plus or minus cash or assets which can be converted into cash,
on short term.
government grants
Government grants are recognised in the statement of financial position initially as received in advance and are recognised as income when there is reasonable assurance that
it will be received and that TMG will comply with the conditions attached to it. Grants that compensate TMG for the
expenses are recognised in the statement of comprehensive
income on a systematic basis in the same period the expenses are made.
expenditure
lease payments
Payments made under operating leases are recognised in
the statement of comprehensive income on a straight-line
basis over the term of the lease. Lease incentives received
are recognised in the statement of comprehensive income
as an integral part of the total lease expense. Minimum lease
payments from financial leases are apportioned between the
finance charge and the reduction of the outstanding liability.
The finance charge is allocated to each period during the lease
term so as to produce a constant periodic interest rate on the
remaining balance of the liability. Conditional lease payments
are incorporated by revising the minimal lease payments
during the remaining lease term as soon as the adaptation of
a lease is confirmed.
financial income and expenses
Result from associates concerns TMG’s share in the total result
of the associate, when TMG has significant influence. Result on
the sale of the associate is stated on the date the transaction
is effected.
The financial income and expenses comprise (the reversal of)
impairment losses of associates and financial instruments (see
accounting policy impairment losses).
The financial income and expenses comprise interest payable
on borrowings calculated using the effective interest method,
interest income on funds invested, dividend income and foreign
exchange gains and losses.
Interest income and expenses are recognised in the statement
of comprehensive income as it accrues using the effective interest calculation method. Dividend income is recognised in
the statement of comprehensive income on the date of the
entity’s right to receive payments. Foreign currency gains and
losses are reported on a net basis. Borrowing costs that are
not directly attributable to an acquisition are recognised in
the statement of comprehensive income using the effective
interest method.
income tax
Income tax on the profit or loss for the year comprises current
and deferred tax. Income tax is recognised in the statement
of comprehensive income except to the extent that it relates
to items recognised directly in shareholders’ equity, in which
case it is recognised in shareholders’ equity. Current tax is
the expected tax payable on the taxable income for the year,
using tax rates enacted or substantially enacted at the balance
sheet date, and any adjustment to tax payable in respect of
previous years.
Deferred tax is provided using the balance sheet liability
method, providing for temporary differences between the
carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.
The following temporary differences are not provided for:
non tax-deductible goodwill, the initial recording of assets or
liabilities which affect neither the commercial nor the fiscal
profit, and differences related to investments in subsidiaries
in so far as these are probably not going to be settled in the
foreseeable future.
The amount of the provision for deferred tax liabilities is
based on the way in which the carrying amount of the assets
and liabilities is expected to be realised or settled, with the tax
rates being used as determined on the balance sheet date, or
to which a material decision has already been taken on the
balance sheet date. A deferred tax asset is recognised only to
the extent that it is probable that future taxable profits will be
available against which the asset can be utilised. Deferred tax
assets are reduced to the extent that it is no longer probable
that the related tax benefit will be realised.
The deferred tax liabilities and assets are netted if there is a
legal entitlement to settle current and deferred tax, the income
tax is charged by the same Tax Authorities and TMG intends to
net the amounts.
segment reporting
An operating segment is a clearly distinguishable component
of TMG that is engaged in business activities from which it may
earn revenues and incur expenses, including revenues and expenses that relate to transactions with other TMG components.
All operating segments’ operating results are reviewed regularly by the Executive Board to make decisions about allocation
of resources.
58
assets classified as held for sale and discontinued operations
On initial classification as held for sale, non-current assets and
disposal groups are recognised at the lower of the carrying
amount and fair value less costs to sell.
Impairment losses on initial classification as held for sale are
included in the statement of comprehensive income, even when
there is a revaluation. The same applies to gains and losses on
subsequent re-measurement.
A discontinued operation is a component of TMG’s business
that represents a separate major line of business or geographical area of operations, or is a subsidiary acquired exclusively
with a view of resale.
Classification as a discontinued operation occurs upon disposal
or when the operation meets the criteria to be classified as held
for sale, if earlier. A disposal group that is to be abandoned may
also qualify.
cash flow statement
The consolidated statement of cash flows is stated in accordance with the indirect method. A distinction is made between
the operating, investment and financing activities. The cash
flow from operating activities is adjusted for items in the statement of comprehensive income and changes in the statement
of financial position which have no effect on the cash flow for
the year.
new accounting standards and interpretations not yet adopted
Certain new standards, amendments to standards and interpretations are not mandatory for TMG in 2010 and are not
early adopted in these financial statements. The following
standards are applicable on or after 1 January 2011 (unless
otherwise stated) and will then be adopted by TMG:
•
•
•
IAS 24 (revised 2009) Related Party Disclosures
(1 January 2011)
IAS 37 amendment – Liabilities
IFRS 2 amendment – Group-settled Share Based Payment
Transactions
• IFRIC 14 amendment – The limit on a Defined Benefit
assets, Minimum Funding Requirements and their Interaction
(1 January 2011).
TMG expects that the adoption of these new standards, amendments to standards and IFRIC interpretations in the future will
have no material impact on TMG’s financial statements.
59
60
2.
segment reporting
2010
2009
2010
2009
Revenues from third-party transactions Revenues from transactions with other segments 479,553
10
479,563
496,029
52
496,081
39,638
100
39,738
41,662
91
41,753
59,404
6,759
52,645
44,249
15,018
29,231
17,374
23,955
-6,581
16,602
24,439
-7,837
-23
128
-674
-11,708
40,368
-433
119
-342
-7,529
21,046
-32
17
-667
2,663
-4,600
-
26
-1,175
2,602
-6,384
-
40,368
3,697
24,743
-
-4,600
-
-6,384
Segment assets
Investments in associates Total assets at 31 December 187,755
154
187,909
202,941
51
202,992
162,713
-
162,713
189,010
-
189,010
Segment liabilities Total liabilities at 31 December 143,528
143,528
142,914
142,914
32,609
32,609
48,935
48,935
Total revenues Segment result before amortisation Amortisation and impairment Operating result Result from associates Financial income Financial expenses Income tax Result of continued operations Gain on sale of discontinued operations, net of tax
Sky Radio Group
Segment investments 3,753
8,032
120
167
Total investments
3,753
8,032
120
167
8,705
9,293
24,450
24,766
Total depreciation and amortisation Restructuring costs 1,097
58
-119
413
Impairment losses intangible assets
-
7,614
-
318
Other material non-cash items 1,097
7,672
-119
731
1,771
1,929
106
113
Average number of FTEs
operating segments
TMG comprises the following main operating segments:
• Telegraaf Media Nederland: The publishing of national and regional newspapers, magazines and free door-to-doorpapers, internetactivities and organising exhibitions.
• Sky Radio Group: The operation of several radio stations in The Netherlands.
• Keesing Media Group: The publishing of puzzle booklets and the operating of (digital) casual gaming activities.
• Other activities: Other activities include, amongst others, the printing and distribution of newspapers, providing of office space
and related facilities, the provision of (internal) ICT services, mobile services and and the operating of a social media platform.
• Headoffice/Eliminations
61
Keesing Media Group
Other activities
Headoffice/Eliminations
Total
2010
2009
2010
2009
2010
2009
2010
2009
47,501
49
47,550
48,541
76
48,617
25,605
179,276
204,881
25,608
213,885
239,493
-
-179,435
-179,435
-
-214,104
-214,104
592,297
-
592,297
611,840
611,840
11,123
4,288
6,835
11,478
4,159
7,319
-9,112
2,355
-11,467
-10,903
1,836
-12,739
-18,697
293
-18,990
-18,103
741
-18,844
60,092
37,650
22,442
43,323
46,193
-2,870
1,747
801
-48
-2,323
7,012
-
98
-585
-1,148
5,684
858
40
-123
3,202
-7,490
-
110
-1
3,710
-8,920
62,528
312
-186
2,007
45,671
64,260
360
301
1,458
47,535
65,078
1,298
-1,698
-6,159
80,961
63,827
713
-1,802
-907
58,961
-
7,012
300
5,984
-
-7,490
-
-8,920
-
45,671
6,368
53,903
-
80,961
10.365
69,326
120,419
-
120,419
122,087
-
122,087
123,000
-97
122,903
115,719
-
115,719
3,358
199,379
202,737
-3,938
136,926
132,988
597,245
199,436
796,681
625,819
136,977
762,796
20,542
20,542
20,742
20,742
37,295
37,295
33,325
33,325
29,155
29,155
47,583
47,583
263,129
263,129
293.499
293,499
1,648
1,648
2,529
2,529
3,827
3,827
4,505
4,505
152
152
-638
-638
9,500
9,500
14,595
14,595
4,589
4,518
13,267
14,268
291
631
51,302
53,476
197
-
197
341
-
341
2,293
-
2,293
4,516
-
4,516
1
-
1
57
701
758
3,469
-
3,469
5,385
8,633
14,018
196
197
626
687
107
62
2,806
2,988
Segment information is presented in respect of TMG’s business and geographical segments. The segmentbase results is based
on the organisational management within TMG and the nature of the (publishing) activties. On a monthly basis, results are reported to the Executive Board to make decisions about performance and allocation of resources within the publishing segments.
The facilitating activities such as printing, distribution an ICT are reviewed at Headoffice and not allocated to operating segments.
The activities of social media are included in other activities. The inter-segment pricing, principally the printing and distributing of
newspapers and the support of ICT projects and -infrastructure, are determined on at arm’s length basis. The intercompany financing
is unallocated. Segment results, assets and liabilities include items directly attributable to the segment as well as, those that can be
allocated on reasonable basis. The decrease in revenues at Telegraaf Media Nederland and Sky Radio Group is caused by less advertisement revenues. Improving results at Telegraaf Media Nederland is due to lower distribution and paper costs. The investments of
a segment include the total cost incurred during the reporting period for the acquisition of assets of the segment which are expected
to be in use for more than one reporting period.
62
geographical segments
For the presentation of information based on geographical segments, the geographical location of the clients is used for the segments’ revenues. The segments’ non-current assets are determined on the basis of the geographical location of those non-current
assets.
revenues and non-current assets are divided in geographical segments as follows:
In thousands of euros 2010
Revenues
Non-current
Assets1)
The Netherlands
Other countries
Total
555,789 36,508 592,297 650,945
1,408
652,353
In thousands of euros Revenues
2009
Non-current
Assets 1)
575,032 36,808 611,840 583,329
1,560
584,889
The Netherlands
Other countries
Total
1)
Except for deferred tax assets.
The revenues in other countries concern the publishing of puzzle magazines and newspapers.
3.
business combinations
On 12 November 2010, TMG acquired 100% voting equity interest in Startphone Limited, de owner of social network Hyves.
The acquisition of Hyves is an important strategic step for TMG, because it provides a significant impulse to realising TMG’s objective of achieving a larger share of its result from digital media. Social networks are taking on an increasingly important role in the
consumer orientation and purchasing process. And that in turn enhances their attraction to advertisers.
In 2009 no material acquistions took place. For acquisitions of prior years the call option on the remaining interest of Nieuwsmedia
B.V. (Geen Stijl) has been executed. In 2009 the estimate of WebRegio B.V., has been changed with an adjustment in the valuation
and acquisition payables of this subsidiary. The adjustment has no significant influence on the financial position of TMG.
63
Startphone
Ltd
Other
acquisitions
Total
25,101
558
4,034
9,361
-6,275
-
-5,477
27,302
-
7
91
44
-
-60
-125
-43
25,101
565
4,125
9,405
-6,275
-60
-5,602
27,259
Goodwill:
Goodwill on acquisition
25,791
Total consideration
53,093
93
50
25,884
53,143
Acquisition cash flow:
Total consideration
53,093
Cash acquired -9,361
Net cash outflow
43,732
50
-44
6
53,143
-9,405
43,738
Intangible assets Property, plant and equipment
Trade and other receivables
Cash
Deferred tax liabilities
Other non-current liabilities
Current liabilities
Net identifiable assets and liabilities the effect of the acquisition of Hyves on the consolidated assets and liabilities TMG was as follows:
Before
acquisition date After acquisition date
Intangible assets Property, plant and equipment
Cash
Deferred tax liabilities
Current liabilities
Net identifiable assets and liabilities -
558 4,034 9,361 -
-5,477 8,476
25,101
558
4,034
9,361
-6,275
-5,477
27,302
Goodwill on acquisition
Total
25,791
53,093
The identified intangible assets with total value of 25,101 primarily involve brand name, customer relationships and database. The amortisation period for the brand name is 10 years, the customer relationships within 1 year and the database is
amortised in 5 years.
The goodwill represents the value of future economic benefits related to partnering with TMG’s brands and products. The goodwill
is not deductible for tax purposes.
The fair value of the trade receivables is 1,949. The trade receivables are shown net of impairment losses.
The acquisition costs of 763 are included in the statement of comprehensive income.
The acquisition of Startphone Limited in 2010 had a positive effect on revenues of 4,602 and 615 on net result. If the acquisition of
Startphone Limited had taken place on 1 January, the revenues and net result would have been 20,513 and 2,576 respectively.
64
4.
revenues
2010
2009
Advertisements
Circulation
Print third parties
Distribution
Other activities
Total
265,264 276,131 3,584 14,003 33,315 592,297 277,277
281,388
3,600
16,622
32,953
611,840
The revenue of 592,297 (2009: 611,840) includes barter transactions of 2,283 (2009: 1,330). The other activities consist of SMS-,
gaming and internet activities.
5.
other operating income
2010
2009
Net gain on disposal of property, plant and equipment
Grants
Other
Total
423 -
-
423 2,571
269
62
2,902
2010
2009
Paper and ink
Auxiliary materials
Total
41,014 3,363 44,377 49,404
3,152
52,556
Note
2010
2009
Wages and salaries
Compulsory social security contributions
Contributions to pension schemes
26
Other personnel costs
Restructuring costs
27
Total
154,366 21,571 18,579 18,215 3,469 216,200 160,137
21,028
18,849
23,247
5,385
228,646
6.
raw and auxiliary materials
7.
personnel costs
The personnel costs decreased caused by a FTE reductionprogram in 2008, which has been finished in 2010 largely. The average
amount of employees (FTE) is 2,806 (2009: 2,988). The other personnel costs decreased because of less temporary personnel.
65
8.
depreciation, amortisation and impairment
Note
2010
2009
Amortisation
14
Impairment intangible assets
14
Depreciation
15
Total
37,650 -
13,652 51,302 37,560
8,633
15,916
62,109
The intangible assets impairments in 2009 were mainly related to Bohil Media B.V., Weekbladen Groep Midden Nederland B.V.,
Nobiles Media B.V., and 402EVENTS.COM B.V.
9.
other operating expenses
2010
2009
Transport and distribution costs
Subcontracted work and technical production costs
Sales costs
Editorial costs Impairment of trade receivables
Other operating expenses
Total
86,305 40,150 29,485 20,392 4,022 78,045 258,399 101,750
46,014
27,432
20,295
3,070
75,740
274,301
In thousands of euros The other operating expenses of 78,045 (2009: 75,740) consist of IT expenses 24,655 (2009: 23,579), housing expenses 16,064
(2009: 16,702) and other general expenses 37,326 (2009: 35,461).
10.
financial income and expense
2010
2009
2,903 18,375 43,800 65,078 -440
8,267
56,000
63,827
Financial income
1,298 713
Financial expenses
Total
-1,698
-1,802
64,678 62,738
Result from associates
Result on sale of associates
Share of result associates
Reversal of impairment losses
TMG holds a 12% interest in ordinary shares with voting rights in ProSiebenSat.1 Media AG (economic interest: 6%). The associated
company is valued at the ‘equity’-method. The share in the result of 18,768 (2009: 8,670) in ProSiebenSat.1 Media AG is included in
Share of result associates.
At the end of 2008 an impairment loss was recognised on the associate ProSiebenSat.1 Media AG of 99,800. This impairment loss
has been reversed at the end of December 2010 for 43,800 (2009: 56,000) due to structurally improved expectations about future
cash flows (see note 16).
66
11.
income tax
Note
2010
2009
Current tax
Current year
Adjustment from prior years
3,759 88 1,796
165
Deferred tax
21
2,312 Origination and reversal of temporary differences
Total income tax
6,159 -8,010
-6,049
6,159 907
6,159 907
Tax on discontinued operations
13
-
Tax on gain on sale of discontinued operations
13
-
Income tax from discontinued operations
-
6,159 Total income tax
-7,649
693
-6,956
Tax on continued operations
Income tax reported in the consolidated
statement of comprehensive income -6,049
2010
2009
Result continued operations before tax
Result discontinued operations before tax
Gain on sale of discontinued operations, before tax
Result before tax
87,120 -
-
87,120 59,868
-4,070
7,479
63,277
Tax rate in the Netherlands
25.5%
25.5%
Income tax based on Dutch tax rate
Effect of tax rate in foreign jurisdictions Non-deductible expenses
Tax exempt results
Unrecognised losses carried forward
Advantage from unrecognised prior losses carried forward
Tax facilities
Other changes in tax rates
Over (under) provided prior years
Losses realised on liquidation
Total
22,216 179 569 -16,788 236 -
-134 -277 158 -
6,159 16,136
6
2,552
-19,134
320
-788
-296
165
-5,010
-6,049
The tax exempt results in 2010 and 2009 includes the reversal on the impairment and share in result of ProSiebenSat.1 Media AG.
67
reconciliation of the effective tax rate
The effective tax rate on the result from all activities was negative 7.1% in 2010 (2009: 9.6% negative). The relationship between the tax
rate in the Netherlands and the effective tax rate on continued operations is as follows:
2010
2009
Dutch income tax rate
25.5 25.5
Tax effects of:
0.2 - Deviating rates
- Tax-exempt results and non-deductible costs
-18.5 - Losses realised on liquidation
0.0 - Other effects
-0.1 Effective tax rate
7.1 0.0
-26.2
-7.9
-1.0
-9.6
In percentages
12.
current tax assets and liabilities
The current tax asset of 428 (2009: 352) represents the amount of taxes recoverable in respect of current and prior periods that
exceeds payments.
The current tax liability of 7,728 (2009: 7,287) represents the income tax to be paid over current and prior years after deduction
of payments.
13.
discontinued operations
In 2010 the activities of Keesing Reference Systems B.V., the SMS-activities of Mobillion and the exhibitions of 402 Events were disposed. The discontinued activities has no significant effect on the result of TMG and therefore not separately classified.
sold 2009
The Netherlands
• The magazines Elegance, Residence, Hitkrant, JAN, FHM, CosmoGirl! and Motoplus. The TTG titles Privé, Vrouw and Autovisie
are continued, because these titles are closely allied with the De Telegraaf daily newspaper and the markets served by that
company. These titles are recorded under continued operations.
• The 84% interest in Media Librium B.V., market leader in digital out-of-home media.
• The 70% interest in DataWire Sport B.V., supplier of sport results and other sport information.
terminated 2009
The Ukraine
• The portfolio of magazines, including the corresponding websites.
The discontinued operations involve Telegraaf Media Nederland, Keesing Media Group and other activities segments. The net cash
flow and statement of financial position of discontinued activities relate to the sale of the assets and liabilities of The Netherlands
and the Ukraine.
68
Note
2009
Result of discontinued operations
Revenues
7,366
Wages and salaries Compulsory social security contributions and pension schemes Other personnel costs Restructuring costs 27
Amortisation 14
Impairment loss
14
Depreciation 15
Other operating expenses Total expenses
3,462
650
17
78
103
333
6,160
10,803
Result from discontinued operations
-3,437
Financial income and expenses
Income tax Result from discontinued operations, net of income tax
-1,226
-7,649
2,986
Gain on sale of discontinued operations
Tax on gain on sale of discontinued operations
8,072
693
10,365
Basic and diluted earnings per share (EUR) - discontinued operations
0.22
Cash flow of discontinued operations
Cash flow from operating activities
Cash flow from investing activities
Cash flow from financing activities
Net cash from discontinued operations
-5,359
1,453
1,308
-2,598
overview sold assets and liabilities in 2009:
2009
Intangible assets
Property, plant and equipment
Non-current financial assets
Accounts payable and other current liabilities
Restructuring provision
Interest-bearing loans and other borrowings
Net identifiable assets and liabilities
-1,274
-937
-102
-1,988
6,360
1,349
628
4,036
Cash received
Discontinued cash
Net cash inflow
Consideration to receive
5,695
-3,659
2,036
2,000
69
14.
intangible assets
Trade
names and
Assets
publishingunder con-
Note
rights
Licences
Goodwill
Software struction
Total
Cost
Cumulative amortisation
Impairment
Carrying amount at 1 January 2009
116,942
14,235
6,914
95,793
124,131
63,319
-
60,812
322,284
59,799
20,922
241,563
65,512
34,763
11,192
19,557
312
-
-
312
629,181
172,116
39,028
418,037
Movements carrying amount
Investments
Discontinued operations
13
Amortisation
8, 13
Impairment loss
8, 13
Assets under construction in use
Transfer to assets held for sale 21
Total movements
1,429
-850
-7,224
-601
-
223
-7,023
-
-
-24,094
-
-
-
-24,094
3,649
-348
-
-8,032
-
200
-4,531
3,899
-76
-6,346
-
774
-184
-1,933
1,678
-
-
-
-774
-
904
10,655
-1,274
-37,664
-8,633
239
-36,677
Cost
Impairment
115,365
19,080
7,515
88,770
124,131
87,413
-
36,718
270,868
4,882
28,954
237,032
65,564
36,748
11,192
17,624
1,216
-
-
1,216
577,144
148,123
47,661
381,360
Investments Acquisitions through business combinations 3
Amortisation
8, 13
Transfer to assets held for sale
Total movements
244
25,101
-2,337
-8,806
-
14,202
-
-
-
-21,403
-
-21,403
22
25,884
-
-
-
25,906
3,471
-
-15
-7,441
234
-3,751
818
-
-
-
-234
584
4,555
50,985
-2,352
-37,650
15,538
Cost
Impairment
Carrying amount at 31 December 2010
138,648
28,161
7,515
102,972
123,667
108,352
-
15,315
296,776
4,884
28,954
262,938
68,929
43,864
11,192
13,873
1,800
-
-
1,800
629,820
185,261
47,661
396,898
Trade names and publishing rights concern acquired trade names and publishing rights of including Sky Radio Group and
Keesing Media Group. Given the strong alliance between trade names and publishing rights, these items are not listed separately.
The amortisation of the trade names (38,800) of Sky Radio Group is 50 years. The amortisation period of the other trade names
and publishing rights ranges from 5 to 20 years. In 2010 TMG acquired the trade names and publishing rights of Hyves (25,101).
The licences relate to the broadcasting rights of Sky Radio Group and are acquired under contract to 2011. The amortisation period
amounts to 5 years. Licences include also the annual contributions of Sky Radio Group to the Telecom agency. The annual payments to the Telecom agency till 1 September 2011 are recognised for an amount of nil (2009: 10,978). The related non-current
liability is accounted for in note 25.
Goodwill through business combinations mainly relates to Sky Radio Group (97,327), Relatieplanet B.V. (16,302) and Keesing Media
Group (74,700) and Hyves (25,791). In addition, 12,000 (2009: 12,000) relates to synergy effects of the Telegraaf Drukkerij Groep
B.V. resulting from acquisitions. Goodwill is believed to be indefinite and is therefore not amortised. All intangible assets have been
acquired externally.
70
intangible assets under construction
This includes information systems (partly self-developed) at Telegraaf Media Nederland B.V. and the development of a renewed website at Uitgeversmaatschappij De Telegraaf. The information systems will be in use in 2011.
impairment test
For the impairment test, intangible assets are allocated to cash-generating units, being the lowest level within TMG for which there
are separately identifiable cash flows.
The carrying value of intangible assets attributed to the cash-generating units as at 31 December 2010 and 2009 is as follows:
intangible assets
2010
2009
Sky Radio Group
Keesing Media Group
Other activities
Unallocated
71,685 152,550 105,330 64,062 3,271 396,898 75,850
176,505
111,102
14,842
3,061
381,360
2010
2009
Sky Radio Group
Keesing Media Group
Other activities
Unallocated
Total
50,500 97,327 74,700 37,791 2,620 262,938 50,387
97,327
74,700
12,000
2,618
237,032
Total
goodwill
In thousands of euros The recoverable amount of the cash-generating units is based on the value in use calculations. Cash-flow projections are based on
actual operating results and cash flow forecasts, the budget 2011 and the long-term plans up to and including 2013. The cash flows
after 2013, which are extrapolated on the basis of 0% growth, are also taken into account. Radio is excepted where a growth rate
of 3% is applied. The forecast cash flows are calculated based on a pre-tax discount rate of 8.5% (2009: 8.3%). The discount rate
and growth factors were determined on the basis of the risk profile for TMG as a whole. These assumptions have been applied to
all cash-generating units in TMG. The values assigned to the key assumptions represent management’s assessment of future trends
in the media industry and are based on both external sources and internal sources (historical data). A modification in assumptions
and estimates could have consequences for the recoverable amount of an asset and the expected economic lifetime with an effect
on the statement of comprehensive income.
In 2010 no impairment on intangible assets occurred (2009: 8,633). An increase of 1% of the WACC would result in an additional
impairment loss of 9,288 (2009: 14,054). In 2009 the impairments on intangible assets were related to Telegraaf Media Nederland.
71
15.
Note
Other
Assets
Land and Machines and
tangible under con-
buildings installations fixed Assets struction
Total
Cost
Cumulative depreciation
Carrying amount at 1 January 2009 162,107
118,499
43,608
238,298
213,671
24,627
89,826
72,998
16,828
740
-
740
490,971
405,168
85,803
Investments
Divestments
Discontinued operations 13
Depreciation
8, 13
Impairment loss
8, 13
Transfer to assets held for sale
21
Total movements 495
-178
-37
-4,932
-
738
-1,947
-5,861
1,165
48
-
-7,400
-
-
-
-6,187
2,211
-10,950
-886
-3,861
-55
-
1,103
-12,438
69
-
-14
-
-
-738
12
-671
3,940
-11,080
-937
-16,193
-55
-832
-25,157
Cost
Impairment
160,272
122,525
-
37,747
238,697
220,257
-
18,440
66,086
61,641
55
4,390
69
-
-
69
465,124
404,423
55
60,646
Investments
Acquisitions through business combinations
3
Divestments
13
Depreciation
8, 13
Total movements
681
-
-6
-
-4,432 155
-3,602
1,182
-
-224
-
-6,719
195
-5,566
1,676
565
-211
-6
-2,501
809
332
1,405
-
-
-
-
-1,159
246
4,944
565
-441
-6
-13,652
-8,590
Cost
Impairment
160,619
126,474
-
34,145
238,653
225,779
-
12,874
61,493
56,716
55
4,722
315
-
-
315
461,080
408,969
55
52,056
Property, plant and equipment consist of land and buildings, machines and installations of the printing facility and other equipment. In 2009 the passenger car fleet of TMG is sold to Terberg Leasing B.V. In the same time with the sale to Terberg Leasing B.V.
an operational lease agreement was concluded for the passenger car fleet. The value of the land and buildings based on the
Real Estate Appraisal Act amounts to approximately 98,393 (2009: 99,371).
assets under construction
The ‘assets under construction’ item concerns on-going replacement investment at HDC Media B.V. en Telegraaf Drukkerij Groep B.V.
The assets will be in use in 2011.
72
16.
investments in associated companies
TMG has the following investments in associated companies:
2010
2009
Participations
München
6.0%
ProSiebenSat.1 Media AG 1)
De Nationale Regiopers B.V./C.V.
Almere
15.8%
Expomedia Plc 2)
London
20.0%
AM van Gaal Media B.V.
Amsterdam
20.0%
Media Menu Beheer B.V. / Media Menu C.V.
Groningen
33.3%
Dutch Creative Industry Fund B.V.
Amsterdam
40.0%
GroupDeal B.V.
Amsterdam
40.0%
Lokale Media Partners Vof
Amsterdam
25.0%
6.0%
15.8%
20.0%
20.0%
33.3%
40.0%
0.0%
0.0%
Location
economic interest 6%, voting rights 12%
in state of insolvency 2009 en 2010
1)
2)
Carrying amount 199,320 ProSiebenSat.1 Media AG 1)
116 Other
199,436 Total
136,752
224
136,976
summary financial information associated companies - figures are based on 100% participation:
Assets Liabilities
Shareholders’
equity
Revenues
Result
5,290,400 1,025,900 3,000,000 312,700
2009
6,174,735 5,593,902 ProSiebenSat.1 Media AG
580,833 2,760,840 144,538
2010
ProSiebenSat.1 Media AG 1)
1)
6,316,300 Based on preliminary, unaudited, Q4 figures of ProSiebenSat.1 Media AG.
ProSiebenSat.1 Media AG
TMG has 12% interest (6% economic interest) in the ordinary shares with voting rights of ProSiebenSat.1 Media AG. Although TMG
owns less than 20% of the voting shares, it has evident significant influence on operational and financial policy of ProSiebenSat.1
Media AG. TMG has voting rights in the general meeting of shareholders to decide on possible dividend payments as well as one
of the nine membership positions in the Supervisory Board. Furthermore TMG has a membership in a subcommittee. Given the
governance structure of ProSiebenSat.1 Media AG a substantial number of decisions require approval from the Supervisory Board.
The 12% interest in ordinary shares with voting rights of ProSiebenSat.1 Media AG is stated as an associate. TMG received the 12%
interest after payment of 377,082. In 2008 an impairment loss has been recorded on the financial instrument of 195,000, corresponding the IFRS guidelines this impairment loss could not be reversed.
73
the movements in the associated company ProSiebenSat.1 Media AG as from the acquisition per 25 September 2008 is as follow:
Carrying value associate ProSiebenSat.1 Media AG per 25 September 2008
182,082
Share in result associate
Impairment associate
Carrying value associate ProSiebenSat.1 Media AG per 1 January 2009
-10,200
-99,800
72,082
Reversal of impairment associate
Carrying value associate ProSiebenSat.1 Media AG per 31 December 2009
56,000
8,670
136,752
Reversal of impairment associate
Carrying value associate ProSiebenSat.1 Media AG per 31 December 2010
43,800
18,768
199,320
The ordinary shares ProSiebenSat.1 Media AG with voting rights (non-listed), owned by TMG, amounted at the end of 2010 and
2009 13,127,832.
valuation as per 31 December 2010
At the end of 2010 is concluded that the cashflow 2010 and expected future cashflow 2011 and further, exceed the assumptions
applied at the end of 2009. The expected future cash flows of ProSiebenSat.1 Media AG increased sustainable corresponding the
estimation of TMG and available market data. After 2011 TMG expects a recurring EBITDA growth rate of 3% for 2012 and 2013 and
1.5% for the years thereafter. The pre-tax discount-rate used is 8.06% whereby an adjustment of the discount rate by 1% will significantly impact the valuation. A discount factor of 25% has been applied to listed preference shares in relation to the ordinary voting
shares . TMG concluded that there were objective indications in 2010, to reverse 43,800 of the impairment loss 2008 on the associated company. It is sufficiently certain that the improvements in result and cash flows will sustain. At the end of 2009 56,000 was
reversed. In 2010 the impairment loss at the end of 2008 was fully reversed.
In accordance with IFRS guidelines, TMG has valued its equity interest in ProSiebenSat.1 Media AG at the higher of the calculated
value in use and the fair value. The reversal of the impairment loss is recorded through the statement of comprehensive income.
74
valuation as per 31 December 2009
When assessing the valuation of the associated company ProSiebenSat.1 Media AG as per 31 December 2009, TMG analysed whether there were indications for an impairment loss or reversal of an impairment loss. The expected future cash flows of ProSiebenSat.1
Media AG increased compared to the prior year. TMG estimated the expected future cash flows of ProSieben Sat.1 Media AG based
on assumptions of available market data. After the transition year 2010, TMG expects a recurring EBITDA growth rate of 5% for 2011
and 2012 and 1.5% for the years thereafter. The pre-tax discount rate used is 9.84%, whereby an adjustment of the discount rate by
1% will significantly impact the valuation. A discount factor of 25% has been applied to listed preference shares in relation to the
ordinary voting shares. TMG concluded that there were objective indications, to reverse 56,000 of the impairment loss 2008 on the
associated company, in 2009. It is sufficiently certain that the improvements in result and cash flows will sustain. In accordance with
IFRS guidelines, TMG has valued its equity interest in ProSiebenSat.1 Media AG at the higher of the calculated value in use and the
fair value. The reversal of the impairment loss is recorded through the statement of comprehensive income.
other investments in associated companies
The 15.8% interest (2009: 15.8%) in the Nationale Regiopers is a partnership with other regional newspaper publishers in the
Netherlands for advertising sales. As a consequence of the economic interest and the membership in the Supervisory Board of
Nationale Regiopers, TMG has significant influence.
As a consequence of the worldwide weakening of the macroeconomic environment, the results of Expomedia Plc were in 2008
under pressure, therefore refinancing of the business in December 2008 could not be realised. Since Devember 2008 Expomedia
Plc is in state of insolvency. In January 2009 the firm is in receivership. TMG’s has valued its 20% interest in Expomedia Plc at nil in
late 2008.
TMG’s share in the total profit or loss from the above-mentioned associated companies over 2010 amounts to 18,375 (2009: 8,267).
Loss making associated companies are valued at nil. All negative results of associates are recorded in the statement of comprehensive income.
17.
other receivables
2010
2009
Non-current receivables
Prepaid operational lease
Non-current receivables
Total
2,537 1,426 3,963 2,687
3,220
5,907
2010
2009
Raw materials
Auxiliary materials
Total
4,594 2,807 7,401 12,948
1,788
14,736
18.
inventories
No impairments are stated on inventories in 2010 and 2009. The carrying value is considered to reflect the fair value.
75
19.
2010
2009
Trade receivables Other receivables Prepayments and accrued income Total
60,578 2,962 17,015 80,555 64,656
4,773
11,369
80,798
In thousands of euros Trade receivables are shown net of impairment losses. During the current year, such losses amounted to 4,022 for bad debts (2009: 3,070).
For more information see note 30, Financial risk management.
fair value
For current receivables, the nominal value is considered to reflect the fair value.
20.
cash and cash equivalents
2010
2009
Bank
Call deposits
31,681 7,903 39,584 56,506
56,506
Total
At balance sheet date 7,903 was placed in deposits. The remaining term of the the deposits is 1 month maximum. The fair value is
deemed equal to the nominal value.
21.
assets and liabilities held for sale
2010
2009
Assets
Intangible assets
Inventories
Cash
Total
-
11,728 -
-
-
11,728 253
11,884
59
877
1,809
14,882
Liabilities
Interest-bearing loans and borrowings
Accounts payables and other current liabilities
Restructuring provision
Total
-
-
-
-
95
2,410
78
2,583
The property, plant and equipment concern company premises of subsidiaries classified as held for sale. TMG expects the sale of
the company premises as highly probable. Sale in the last two years was not realised despite sufficient interest. Keesing Reference
Systems B.V. was classified as assets and liabilities held for sale at the end of 2009 and was sold in January 2010.
76
22.
issued capital
At 31 December 2010 the authorised share capital comprised 99,999,040 ordinary shares, 100,000,000 preference shares and
960 priority shares, which were issued and paid up as follows:
Number of shares
Ordinary
shares
Priority
shares
Ordinary shares
Priority
shares
47,750,000 -
47,750,000 960 -
960 50,000,000 2,250,000 47,750,000 960
960
On issue as at 1 January Shares withdrawn On issue at 31 December
2010
2009
All shares have been paid up and have a nominal value of € 0.25. No preference shares have been issued.
The holders of priority shares receive a dividend of five percent of the nominal amount of the shares. The remaining profit is at
the disposal of the meeting of shareholders.
The holders of ordinary shares and priority shares are entitled to cast one vote per share during the meeting. Each TMG shareholder
has access to the meeting of shareholders and the right to cast a vote. A summary of the legal and statutory provisions relating to
the appropriation of the profit and the other statutory rights associated with the ordinary shares, priority shares and preference
shares is included under ‘Other Information’ as from page 102.
The right to issue TMG preference shares is granted by Stichting Beheer van Prioriteitsaandelen Telegraaf Media Groep N.V.
to Stichting Preferente aandelen Telegraaf Media Groep N.V. TMG has a call option to issue preference shares, which will then
be managed by Stichting Preferente aandelen Telegraaf Media Groep N.V. At present, no preference shares have been issued.
The provisions in the articles of association governing remuneration of preference shares are in line with the market. The option
to issue preference shares is valued at nil.
translation reserve
The translation reserve is realised in 2009 with the formal termination of the activities in Sweden and the Ukraine. The translation
reserve comprises all the foreign exchange differences arising from the translation of the financial statements of foreign operations
in Sweden and the Ukraine.
repurchased shares
At the end of 2010 TMG had no repurchased own ordinary shares. The repurchased shares 2008 were withdrawn in August 2009.
The cost of in 2008 repurchased ordinary shares and in 2009 withdrawn ordinary shares was 47,030.
77
23.
dividend
in the year under review TMG paid out the dividend over the prior financial year determined by the meeting of shareholders:
2010
2009
€ 0.35 per (depositary receipt for an) ordinary share (2009: € 0.35)
16,713 16,713
In thousands of euros As regards the 960 priority shares, 5% of the nominal amount was paid out as dividend.
after 31 December 2010, the Executive Board made the following dividend proposal for 2010:
2010
€ 0.45 per (depositary receipt for an) ordinary share (2009: € 0.35)
21,488 In thousands of euros
The dividends have not been provided for and there are no income tax consequences.
24.
earnings per share
basic earnings per share
The calculation of the basic earnings per share as at 31 December 2010 is based on the result attributable to ordinary shareholders of 81,826 (2009: 70,505) and a weighted average number of ordinary shares which has been outstanding during 2010 of
47,750,000 (2009: 47,750,000), as shown below:
2010
2009
Earnings per share
Result attributable to equity holders of ordinary shares in Telegraaf Media Groep N.V.
Weighted average number of ordinary shares
Basic earnings per share (EUR)
81,826 47,750,000 1.71 70,505
47,750,000
1.48
diluted earnings per share
The calculation of the diluted earnings per share at 31 December 2010 is based on the result attributable to ordinary shareholders of 81,826 (2009: 70,505) and a weighted average number of ordinary shares, after adjustment in line with all potential
diluting effects on the ordinary shares, which has been outstanding during 2010, of 47,750,000 (2009: 47,750,000). No shares
were diluted in 2009 and 2010.
78
25.
interest-bearing loans and borrowings
This note provides information on the contractual terms of TMG’s interest-bearing loans and borrowings. For more information
about TMG’s exposure to interest rate and foreign currency risk, see note 30.
2010
Total
Current Non-current
Interest-bearing loans
Other financing
Total
10,638 7,409 18,047 -
1,393 1,393 10,638
6,016
16,654
2009
Totaal
Current Non-current
Other financing
Total
11,166 19,280 30,446 -
11,828 11,828 11,166
7,452
18,618
Non-current interest-bearing loans and borrowings of 1,393 (2009: 11,828) are classified as current liabilities.
Year of Carrying
maturity amount 2010
Carrying
amount 2009
Shareholders loan Veronica Holding B.V.
8,400 -
10,638 to Sienna Holding B.V.
EUR 4.1% (2009: 4.1%)
Other loans
EUR
-
-
-
-
Total
10,638 10,219
947
11,166
Other financing
Non-current liabilities
-
-
-
-
Sky Radio Group licences
EUR
Acquisition payables
EUR
-
-
-
7,365 Other non-current liabilities EUR
-
-
-
44 Total
7,409 10,978
8,261
41
19,280
Currency Nominal interest rate Nominal value terms and debt repayment schedule
For all loans, the effective interest is equal to the nominal interest.
other financing
Non-current liabilities relating to the licences of Sky Radio Group involve annual payments to the Telecom agency till 1 September
2011. Besides the payment of a one-time fee to acquire the licensing rights, Sky Radio Group has also an obligation to make annual payments to the Telecom agency. The annual payments to Telecom are listed under intangible assets as nil (2009: 10,978).
The intangible assets are amortised over the contractual period. The interest payments associated with financial liabilities are recorded as financial charges, while the annual payment is deducted from the non-current liability. The fair value of the liabilities does
not differ materially.
79
The acquisition payables includes liabilities concerning the acquisition of Nobiles Media B.V., WebRegio B.V. and Sky Radio Group.
The management shares Sky Radio Group comprise a share based compensation. The amount is not significant. Sky Radio Group
management has a put option to sell the shares on due date to TMG. The fair value share price has been determined in accordance
with a pre-determined formula. At the end of 2010 the current part amounts 1,393 (2009: 850).
In 2010 the last tranche of the management shares Keesing Media Group was bought by TMG against excerise price.
26.
post-employment benefit liabilities
2010
2009
2008
2007
2006
Present value of unfunded obligations
Present value of funded obligations
Present value of obligations
5,764
35,336
41,100
6,057
37,163
43,220
7,221
37,374
44,595
9,814
38,481
48,295
23,055
23,975
47,030
Fair value of plan assets
Present value of net obligations
-17,452
23,648
-16,135
27,085
-15,745
28,850
-17,337
30,958
-20,498
26,532
Unrecognised actuarial gains and losses
Recognised liability for defined
benefit obligations
-312
-153
527
-1,274
-1,552
23,336
26,932
29,377
29,684
24,980
2010
2009
2008
2007 Experience adjustments arising on plan liabilities
Experience adjustments arising on plan assets
Adjusted assumptions plan liabilities
406
-
-1,316
-4,381
-
3,980
1,130
-
1,894
3,644
-
929
defined contribution plan
The pension schemes of Sky Radio Group and Keesing Media Group and a part of the Amsterdam and Alkmaar companies of
TMG is executed by Stichting-Telegraafpensioenfonds 1959. As of 1 January 2008 the pension scheme of Keesing Media Group
and as of 1 October 2009 the average salary regulation of Sky radio Group is executed by Stichting-Telegraafpensioenfonds 1959.
The transfer has no significant financial consequences for TMG.
gross commitment for defined benefit pension rights
TMG contributes to a defined benefit plan on the basis of which a part of employees have (additional) pension rights.
In determining the provision, account is taken of other employee schemes including allowances for the healthcare costs of retired employees, early retirement and anniversary schemes. The release of provisions (or investments) through discontinued activities in 2006
came about due to the sale of the Limburg activities. In 2008, the scheme for pension premium supplementary (including the risk)
at disability is executed by Stichting-Telegraafpensioenfonds 1959, for which a release in the liability (or investments) came about.
80
the principle actuarial assumptions at the balance sheet date are
2010
2009
Discount rate at 31 December Expected return on plan assets at 31 December Future salary increases Adjustment for inflation Increase in social security benefits 3.8%
5.4%
1.0%
2.0%
2.0%
4.9%
5.5%
1.5%
2.0%
1.5%
In weighted averages The expected return on plan assets is the weighted average expected return, based on the expected investment mix of shares
(40%), and fixed-interest securities (60%). The actual return in 2010 amounted 8.7% (2009: 13.3%) on investments at StichtingTelegraafpensioenfonds 1959.
movements in obligation for defined benefit pension schemes
Note
2010
2009
As at 1 January
43,220
44,595
Service costs
Past service costs
Interest expenses
From restructuring provision
27
Actuarial losses (gains) Release of provisions due to scheme reduction
Payments
As at 31 December
910
125
1,683
3,651
854
-119
-9,224
41,100
1,045
-432
2,101
6,602
403
-2,635
-8,459
43,220
2010
2009
As at 1 January
16,135
15,745
Contributions
Expected return
Actuarial gains (losses)
Release of investments due to scheme reduction
Payments
As at 31 December
11,213
661
-1,367
34
-9,224
17,452
11,659
707
-2,661
-856
-8,459
16,135
movements in fair value of plan assets
81
the plan assets consist of the following:
2010
2009
Property shares
Shares
Bonds
Deposits
Plan assets with insurance companies
As at 31 December
704
3,847
6,403
250
6,248
17,452
446
3,491
6,273
16
5,909
16,135
The increase in changes of the liabilities (or investments) is caused by new early retirement schemes from the restructuring provision.
The following funds, which also qualify as defined benefit schemes, have informed TMG that they are not able to provide us with
any details for the calculation of (our share in) surpluses or deficits:
• Pensioenfonds Grafische Bedrijven (pension scheme for employees in the printing and allied trades).
• Stichting bedrijfstakpensioenfonds voor het beroepsvervoer over de weg (pension scheme for the goods haulage sector).
• Stichting vrijwillig vervroegde uittreding voor het beroepsgoederenvervoer over de weg en de verhuur van mobiele kranen
(early retirementscheme for employees in the goods haulage sector and the rental of mobile cranes).
• Stichting Prepensioenfonds voor het beroepsgoederenvervoer over de weg en de verhuur van mobiele kranen (pre-pension
scheme for employees in the goods haulage sector and the rental of mobile cranes).
These plans qualify as defined pension schemes but are processed as defined contribution plans. TMG is not responsible for any
shortfall in an early retirement/pension plan, nor is it required to make up any shortfall. The referenced sectoral plans in general
had a coverage ratio of below 105% at the end of 2009. Foundations concerned prepared a recovery plan and submit it to DNB.
The coverage ratio of the Pensioenfonds Grafische Bedrijven was at end of 2010 approximately 4% above the minimum set by
law of 105%. The possibility that the future pension contributions for the relevant schemes will be increased cannot be precluded.
TMG estimates the contributions to be paid under the defined benefit schemes during 2011 at 8,490 (2010: 8,311), as far as can be
estimated reasonably.
employee benefit expenses in the statement of comprehensive income:
Note
2010
2009
Pension costs allocated to the year of service
Past service cost
Interest on the liability
Expected return on plan assets
Amortisation unrecognised gains/(losses)
Total contribution to defined benefit schemes
910
125
1,683
661
270
3,649
1,045
-432
2,101
707
842
4,263
Result on account of curtailment/termination
Contribution to defined contribution schemes
Total
7
-153
15,083
18,579
-1,779
16,365
18,849
82
27.
restructuring provision
Note
2010
2009
Balance as at 1 January
27,164
54,212
Provisions made during the financial year
7
To post-employment benefit liabilities
26
Release
7
21
Provisions used
Balance as at 31 December
7,690
-3,651
-4,221
-
-10,797
16,185
5,385
-6,602
-78
-25,753
27,164
Non-current
Current
Total
1,973
14,212
16,185
7,657
19,507
27,164
Separate restructuring plans were developed for the TMG-group and TMG Distributie B.V. in the fall of 2008. The restructuring
plans are in principle approved by the CWC, but the sub-plans must still be submitted to the Works Councils of the relevant
subsidiaries. The restructuring plans have been communicated to TMG employees in various ways thereby creating the justified
expectation among employees that the reorganisation will in fact be carried out. The reorganisation has already been initiated
for various components following approval by the Works Council. Largely all parts of the restructuring plan are, after approval
WC, finished. TMG envisions a reduction of 600 FTEs on the basis of the restructuring plans, a significant portion is effected in
2009 and 2010. Additional is in 2010 provided for the discontinuance of the transport activities, Landelijke Media and Telegraaf
Media ICT. In 2009 a restructuring provision is been made caused by the termination of the sunday edition of De Telegraaf for an
amount of 5,385. The restructuring provision concerns the commitments related to job placement services and the discharge of
employees at Telegraaf Tijdschriften Groep B.V., Holland Combinatie B.V., Uitgeversmaatschappij De Telegraaf B.V., HDC Media
B.V., Telegraaf Drukkerij Groep B.V., TMG Distributie B.V. and staff departments. A change in assumptions and estimates could
impact the actual cost of the reorganisation, including the method of discharge (buyout or job placement services) and timing.
The current portion amounts to 14,212 (2009: 19,507).
83
28.
deferred tax assets and liabilities
the deferred tax assets and liabilities recognised can be allocated as follows at the end of the financial year:
2010
Assets
Liabilities
Balance
Intangible assets Property, plant and equipment Post-employment liabilities schemes Provisions Carry-forward loss compensation Net tax asset/liability (-) -
-
-
-
4,632 4,632 -26,804 -747 -71 -69 -
-27,691 -26,804
-747
-71
-69
4,632
-23,059
Assets
Liabilities
2009
Balance
Intangible assets Property, plant and equipment Post-employment liabilities schemes Provisions Carry-forward loss compensation Other items Net tax asset/liability (-) -
-
963 -
9,670 -
10,633 -24,220 -699 -
-70 -
-713 -25,702 -24,220
-699
963
-70
9,670
-713
-15,069
The carry-forward loss compensation is expected to be fully compensated with future profits within the fiscal unity TMG.
unrecognised deferred tax assets in de statement of financial position
With regard to (start-up) losses at a few subsidiaries, no deferred tax assets were recognised on the balance sheet, because
the expectation is that these will not be realised in short time. At the end of 2010, unrecognised deferred tax assets amounted
to 1,504 (2009: 1,368). The unused losses in the Netherlands remain within the limit of 9 years. The decrease is mostly caused
by discontinued operations.
84
movement in temporary differences during the year
Balance
1 January 2010
Recognised
in result
-24,220 -699 963 -70 9,670 -713 -15,069 3,094 -48 -1,034 1
-5,038 713 -2.312 Balance
1 January 2009
Recognised
in result
-30,161 -1,175 1,447 -738 7,887 -443 6,076 279 -484 668 1,794 -323 -
8,010 -135 197 -
-
-11 53 -57 47 -24,220
-699
963
-70
9,670
-713
-15,069
2010
2009
Subscriptions paid in advance Other amounts paid in advance Trade payables to suppliers
Employee benefits payable (holidays/-allowance and profit share) Other taxes and social security premiums Other liabilities and deferred income Total
48,770 1,750 21,808 28,500 21,098 48,216 170,142 49,202
2,963
25,556
26,973
19,465
49,226
173,385
Intangible assets
Post-employment liabilities schemes
Provisions
Carry-forward loss compensation
Other items
Net tax asset/liability (-)
Intangible assets
Post-employment liabilities schemes
Provisions
Carry-forward loss compensation
Other items
Reclassification assets held for sale
Net tax asset/liability (-)
29.
57 -23,126 (De-) Balance 31
Consolidated December 2010
-5,678 -
-
-
-
-
-5,678 -26,804
-747
-71
-69
4,632
-23,059
(De-) Balance 31
Consolidated December 2009
accounts payable and other current liabilities
In thousands of euros Other liabilities and deferred income consist of (estimates for) editorial and distribution expenses, other general expenses, returned
products and commissions to be paid. The fair value of the liabilities does not differ from the nominal value recognised here.
85
30.
financial risk management
TMG recognises the market, credit, currency and interest rate risk involved in regular business operations. The trends in the price
of paper can also have a substantial effect on the business result. These risks have a slight material impact on the financial position
of TMG, therefore internally a high level sensitivity analysis is performed.
The Executive Board has overall responsibility for the establishment and oversight of TMG’s Risk control framework. The Executive
Board makes an annual assessment of the strategic risks at both the central and decentralised level and evaluates the developments and monitoring of the strategic risks quarterly.
TMG’s risk management policies are established to identify and analyse the risks faced by TMG, to set appropriate risk limits and
controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect
changes in market conditions and TMG’s activities. TMG, through its training and management standards and procedures, aims to
develop a disciplined and constructive control environment in which all employees understand their roles and obligations. Group
Internal Audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are
reported to the Executive Board and Supervisory Board.
market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and share prices will affect TMG’s
income or the value of its investment of financial instruments in a negative way. The objective of market risk management is to
manage and control market risk exposures within acceptable ranges.
TMG has a policy of not using any forward, swap and/or future contracts. In 2010 and 2009 no interest-rate swap contracts were
arranged. TMG also has the policy of restricted use of external financing, except for important acquisitions. See further note on
interest-rate risk. The current economic conditions were in 2009 for TMG reason to change future expectations on results. As a
consequence of these assumptions impairments took place on assets in 2009.
credit risks
Credit risk arises principally from TMG’s receivables if a customer fails to meet its contractual obligation. The (industry-wide) terms
of payment applied, the relatively limited dependence on individual customers and the historical payment behaviour of our customers make it unnecessary to use financial instruments to limit this risk. The credit risk is principally concentrated in The Netherlands.
The credit risk is unchanged compared to 2009.
impairment losses
Customers are required to pay within pre-set time limits. Exceeding the deadline results in service deliveries being halted. Customers are primarily media outlets, companies and subscribers. The aging of trade receivables at balance sheet date was:
Total
Not past
due
68,036
72,978
44,956
48,341
Past due 30 Past due 60
and 60 days and 90 days
14,276
12,808
2,292
4,222
Past due 90 Past due 180
and 180 days and 360 days
1,782
2,936
2,265
3,043
More than
360 days
2,465
1,628
86
The difference on the balance as at 31 December 2009 and Note 19 is caused by discontinued operations. TMG has established
an impairment risk provision for estimated losses on trade receivables. The impairment is based on payment arrears and the
stipulated deadlines. Changes in the impairment provision for trade receivables during the year were as follows:
2010
2009
Balance as at 1 January
7,493 8,599
Additions
Use
Balance as at 31 December
4,022 -4,057
7,458 3,172
-4,278
7,493
currency risk
TMG incurs currency risks to a very limited extent due to activities outside the euro zone, namely Denmark. The activities in Sweden
and the Ukraine were discontinued in 2009. The net cash in and outflows of entities and their timing is such that no significant currency positions are created as a result. Sensitivity of TMG to foreign exchange rates is therefore very small. At the end of 2010 TMG
had no forward contracts. TMG has the policy of responding to significant currency exposures by concluding forward contracts to
cover the risks over a period of one year. For an individual entity within TMG, a currency exposure is deemed to be significant if the
size of revenue in any calendar month exceeds 500, and the cash flow has a probability of more than 50%.
interest-rate risk
The most relevant interest-rate risk for TMG involves a mismatch between interest payments and the cash flows from financed
assets. However, TMG is on balance a recipient of interest since the net debt position is more than compensated by the interestbearing cash and cash equivalents. Given the limited size of the debt position, TMG is hardly affected by interest-rate fluctuations,
nor do they have any significant influence on TMG’s financial position and result.
other market-price risk
Of the commodities traded on the global market, TMG only purchases paper, but to the extent that fluctuations in its price can
have a substantial impact on the business result. TMG has decided not to hedge the risk of increasing paper prices because (a)
TMG already has long-term contracts with paper suppliers and (b) large manufacturers of paper have taken up positions on the
futures market making it insufficiently liquid to hedge significant volumes in a manner that would be attractive to TMG.
liquidity risk
TMG has hardly any liquidity risk given the limited financial liabilities and the liquidity position. Liquidity risk is the risk that TMG will
not be able to meet its financial obligations as they fall due. The aim of liquidity risk management is to maintain sufficient liquidity
in order, as far as possible, to cover existing and future financial liabilities under normal and difficult circumstances and without
incurring unacceptable losses or damaging the reputation of TMG.
At balance sheet date a 45,000 euro overdraft facility that is unsecured, unrestricted and without expiry date. Interest would be
payable at the EURIBOR one-month rate plus 1.25 basis points, on the balance-sheet date 559 (2009: 590) of this credit line was
being used.
maturity profile of TMG’s financial liabilities:
In thousands of euros Interest-bearing loans and borrowings
Trade and other payables
Total
Total
18,047
170,142
188,189
6 months
or less
6 - 12
months
1 - 2
years
2 - 5
years
More than
5 years
1,393
158,186
159,579
-
11,956
11,956
243
-
243
16,378
-
16,378
33
33
87
capital management
The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain
future development of business. The Executive Board monitors the return of capital, which TMG defines as the net result divided by
total shareholders’ equity, excluding non-controlling interests. The Executive Board also monitors the level of dividends to ordinary
shareholders.
From time to time TMG purchases its own shares on the market. Buy and sell decisions are made on a specific transaction basis
by the Executive Board within limits set by the Supervisory Board and the annual meeting of shareholders; TMG does not have a
defined share-buy-back plan.
Neither TMG nor any of its subsidiaries are subject to externally imposed capital requirements.
31.
off balance sheet liabilities
non-cancellable off balance sheet operational leases expire as follows:
2010
2009
< 1 year
1-5 years
> 5 years
Total
20,270 17,247 25 37,542 14,072
31,919
272
46,263
In the financial year 2010, an expense of 7,352 (2009: 7,739) was included in the statement of comprehensive income for operational leasing.
Telegraaf Drukkerij Groep B.V. has agreements with paper suppliers for which the liabilities within 1 year amount to 24,875 and
within 1 and 5 years amount to 3,750.
TMG has a long term agreement for printing puzzle magazines and newspapers with a third party. The yearly purchase obligation is
8,350. Within the framework of the termination of non-core activities, Telegraaf Media Groep B.V. entered into an agreement with
Atos Origin concerning the subcontracting of the generic ICT services of Telegraaf Media ICT B.V.. The total value of the contract
for the remaining period till 31 December 2011, is expected to be 9,000 (2009: 19,000).
litigation
At Franken B.V., a former subsidiary of Telegraaf Media Groep, a litigation has been started in which former employees of
Franken B.V. sue TMG for supplementary payment. The litigation is not finished. TMG provided for this litigation.
A number of TMG group companies face legal proceedings. These cases primarily concern employment relations, disputes and rectifications of publications. We have every faith in a positive outcome in the case of all these proceedings and do not expect them to
have a significant effect on TMG’s consolidated financial position.
88
32.
investment commitments
In the financial year 2009 and 2010, TMG did not enter into significant agreements for development of software, or other
investments.
33.
contingent liabilities
At the end of 2010 bank guarantees of 852 (2009: 696) were issued to cover rental agreements.
34.
related parties
identity of related parties
TMG has a related party relationship with its subsidiaries, associates (see section 16 of the notes), joint ventures (see section 35 of
the notes), Stichting-Telegraafpensioenfonds 1959 and Stichting Preferente Aandelen Telegraaf Media Groep N.V. A list of Telegraaf
Media Groep N.V. participations has been published at the Chamber of Commerce in Amsterdam.
The following shareholders have, at 31 December 2010 following the AFM register, an interest of more than 20% in TMG’s capital:
• Stichting Administratiekantoor Telegraaf Media Groep N.V.
• VP Exploitatie N.V.
• Cyrte Investments B.V.
transactions with Executive Board and Supervisory Board
For a specification of the remunerations per manager please refer to the company statement of comprehensive income (Note 8).
The note on related parties refers to TMG senior management, namely the Executive and Supervisory Boards. The total remuneration
is included in Personnel costs (see section 7 of the Notes to the consolidated financial statements).
other related party transactions
Transactions with related parties relate to associated companies (revenues 2010: 15,301; revenues 2009: 7,525). Receivables with
related parties were 5,030 (2009: 2,716) as at 31 December for which a provision is made of 200 (2009: 1,324). In 2010 TMG paid
11,792 (2009: 12,317) premium to Stichting-Telegraafpensioenfonds 1959. Including employees contributions the premium amounted to 17,518 (2009: 19,000). All outstanding balances with these related parties are priced on an arm’s length basis and are settled
in cash within six months of the reporting date. None of the balances is secured.
89
35.
interests in joint ventures
the group has an interest in the following joint ventures:
2010
2009
Participations
49.0%
TTG Sulake B.V.
Amsterdam
Adventure Holding B.V.
Zeist
33.3%
JAAP.NL B.V. 1)
Amsterdam
100.0%
49.0%
33.3%
50.0%
1)
Location
from April 2010 100% consolidated.
the consolidated financial statements include the following items which correspond to TMG’s interest in the joint venture’s assets and
liabilities, revenues and costs (proportionate consolidation):
2010
2009
Non-current assets Current assets Non-current liabilities Current liabilities Balance of assets and liabilities 55
1,468
-1,634
-590
-701
72
1,025
-1,418
-699
-1,020
2010
2009
Revenues Expenses Financial income and expense Income tax Net result 2,262
-1,170
-92
-292
708
1,704
-1,259
-83
-183
179
36.
subsequent events
Reference is made to ‘Other Information’ for an explanation on the subsequent events.
company financial statements 2010
91
company statement of comprehensive income
2010
2009
Result of subsidiaries (after tax)
85,743 70,787
Other income and expense (after tax)
-3,917
81,826 -282
70,505
Other comprehensive income for the year, net of tax
-
81,826 594
71,099
92
company statement of
financial position
as at 31 December, before approportion of result
In thousands of euros Note
2010
2009
non-current assets
Intangible assets
Goodwill
2
28,390 Non-current financial assets
460,293 Subsidiaries
Deferred tax assets
3,600 Total non-current financial assets
3
463,893 492,283 Total non-current assets 2,599
344,902
10,004
354,906
357,505
CURRENT ASSETS
Subsidiaries
4
Total current assets Total assets
354,517 354,517 396,443
396,443
846,800 753,948
Issued capital Other reserves Retained earnings
Total shareholders’ equity 5
11,938 437,311 81,826 531,075 11,938
383,519
70,505
465,962
NON-CURRENT liabilities
6
-
2,103
current liabilities
Subsidiaries
239,690 Borrowings and other financing 66,704 Accounts payable and other current liabilities 9,331 Total current liabilities
315,725 315,725 Total liabilities 846,800 Total shareholders’ equity and liabilities
255,123
24,953
5,807
285,883
287,986
753,948
93
notes to the company financial statements
contents
page note
94
94
94
95
95
95 95
96
97
1. 2. 3. 4. 5. 6. 7. 8. 9.
Significant accounting policies
Intangible assets
Non-current financial assets
Receivables
Shareholders Equity
Non-current liabilities
Off-balance sheet liabilities
Remuneration of Executive Board and Supervisory Board members
Service fee external auditor
94
1. significant
accounting policies
general
The company financial statements have been prepared in accordance with the provisions in Part 9, Book 2 of the Netherlands
Civil Code. As regards determining the principles for the valuation of assets and liabilities and the result of its company financial statements, Telegraaf Media Groep N.V. uses the option provided for in Article 2:362, paragraph 8 of the Netherlands Civil
Code. This means that the principles for the valuation of assets and liabilities and the determination of the result (hereinafter to
be referred to as the ‘accounting principles’) of the company financial statements of Telegraaf Media Groep N.V. are the same as
those used for the consolidated IFRS financial statements. Investments in subsidiaries, in which TMG has significant influence, are
accounted for in accordance with the equity method. These consolidated IFRS financial statements have been prepared in accordance with the standards of the International Accounting Standards Board and approved by the European Union.
Please refer to pages 50 to 59 for a description of these principles. Share in result of subsidiaries, joint ventures and associates
includes the share of Telegraaf Media Groep N.V. in the results of these participations. Results on transactions which have involved
the transfer of assets and liabilities between Telegraaf Media Groep N.V. and its participations and between participations themselves have not been processed in so far as these cannot be regarded as having been realised. A reference is made to the Notes to
the consolidated financial statements, unless otherwise stated. In conformity with article 402, Book 2 of the Netherlands Civil Code,
a condensed statement of comprehensive income is included in the company financial statements of Telegraaf Media Groep N.V.
2.
intangible assets
2010
2009
Goodwill
Cost
Impairment Carrying amount at 1 January 3,300 701 2,599 11,979
8,679
3,300
Investments
Impairment
Total movements 25,791 -
25,791 -701
-701
Cost
Impairment
Carrying amount at 31 December
29,091 701 28,390 3,300
701
2,599
2010
2009
Subsidiaries
Share in equity 460,293 344,902
3,600 10,004
463,893 354,906
In thousands of euros 3.
non-current financial assets
In thousands of euros Deferred tax assets
Total
95
movements in non-current financial assets can be shown as follows:
Subsidiaries
Deferred
tax assets Total
344,902 10,004 354,906
Movements in carrying amount
Share in result of investments
Investments
Movements in temporary differences during year
Intercompany
85,743 27,443 -
2,205 460,293 -
-
-6,404 -
3,600 85,743
27,443
-6,404
2,205
463,893
2010
2009
Subsidiaries
Other receivables and accrued income Total
354,481 36 354,517 396,443
396,443
4.
receivables
In thousands of euros 5.
For the consolidated statement of changes in equity see page 48 and note 22 of the consolidated financial statements. The legal
translation reserve amounted to nil (2009: nil). The translation reserve caused by discontinued activities in Sweden and the Ukraine
is reported in the 2009 statement of comprehensive income.
6.
non-current liabilities
The loans in 2009 were related to management shares with regard to Sky Radio Group and Keesing Media Group. Further details
are included in the notes to the consolidated statement of financial position (Note 25).
7.
off-balance sheet liabilities
joint and several liability and guarantees
Pursuant to Article 403, paragraph 1, subparagraph f of Book 2 of the Dutch Civil Code, the company holds itself liable for the debts
arising from the legal transactions of the Dutch group companies in which it holds an interest of 95% or more, with the exception
of Holland Combinatie Participaties B.V. A list of group companies has been filed with the Chamber of Commerce and will be made
available by the company upon request.
fiscal unity
TMG, along with almost all of its wholly-owned subsidiaries in the Netherlands, is a single fiscal unity for both income tax and VAT.
Within the fiscal unity, TMG companies are jointly and severally liable for tax liabilities to the Tax Authorities.
96
8.
remuneration of executive board and supervisory board members
remuneration policy for the Executive Board
During the extraordinary general meeting of shareholders held of TMG N.V. on 7 December 2010, the amended remuneration policy for
the Executive Board has been approved. The remuneration policy is available on the website of TMG (www.tmg.nl). The remuneration
structure is unchanged and consists of a fixed and variable element. The fixed element consists of the annual salary and the vacation allowance. The variable component consists of a) the existing profit sharing scheme for all Telegraaf Media Groep N.V. employees and b)
an individual bonus. The individual bonus varies between 0 and 2 monthly salary payments; 60% is determined on the basis of the degree
to which the collective targets of the Executive Board are realised and 40% on the basis of the degree to which the individual targets of
the members of the Executive Board are realised. In addition, the Supervisory Board may decide to award an additional bonus and shall
render account of any such award at the annual general meeting of shareholders. In setting the remuneration for the members of the
Executive Board, the Supervisory Board takes various factors into account within the framework of the general remuneration policy, such
as the required competences, skills, as well as the responsibilities of the members of the Executive Board.
remuneration
The achieved results in 2010 substantiate a payment of variable compensation on the basis of the collective targets and on the basis
of personal objectives. The Supervisory Board decided to pay a variable bonus equal to two monthly salary payments and an 1.8%
adjustment for inflation was applied to the fixed salaries of each member of Executive Board effective 1 January 2011.
Included in the periodical remuneration is a variable component over the former financial year for Mr. Swartjes of 79,764 (2009: nil)
and Mr. Arp 72,876 (2009: nil) and Mr. Morley 72,876 (2009: nil).
The remuneration of the Supervisory Board is based on indexation of retail price all families (2000=100) as of 1 January 2007.
remuneration of the Executive Board
In euros
2010
Deferred
remuneration
Members of the Executive Board
A.J. Swartjes
596,631 186,195 526,112 F.Th.J. Arp
545,111 168,517 471,778 P. Morley MSc.
545,111 176,278 471,778 186,116
168,437
176,278
Periodical
remuneration Deferred
remuneration 2009
Periodical
remuneration
remuneration of the Supervisory Board
In euros
Periodical
remuneration 2010
2009
Periodical
remuneration
Deferred
remuneration
Members of the Supervisory Board A.J. van Puijenbroek
31,580 -
31,213 Dr. W. van Voorden***
26,252 -
25,949 H.L. Weenen*
15,314 -
25,949 Mrs. M. Tiemstra
26,252 -
25,949 L.G. van Aken**
-
-
8,606 J.G. Drechsel
26,252 -
25,949 D.H.H.D. Ropers
18,198 -
-
-
* Mr. H.L. Weenen has decided to resign from the Board effective on 1 August 2010.
** Mr. L.G. van Aken passed away on 7 April 2009.
***Mr. W. van Voorden has decided to resign from the Board effective on 1 March 2011.
Deferred
remuneration TMG financial statements 2010
97
share ownership at 31 December 2010
Members of the Executive Board
A.J. Swartjes
F.Th.J. Arp
P. Morley MSc.
Members of the Supervisory Board
A.J. van Puijenbroek
Dr. W. van Voorden
Mrs. M. Tiemstra
J.G. Drechsel
D.H.H.D. Ropers
9.
Depositary receipts
Shares for shares
-
-
-
646
-
64 -
-
-
-
-
service fee external auditor
the service fee recognized in the financial statements for the external auditor Deloitte Accountants B.V. pursuant to art. 382a BW2
is as follows:
2010
2009
Audit of the Financial statements
Other assurances services
Tax services
Other-non-audit services
Total
427 40 -
-
467 549
98
3
650
In 2009 KPMG Accountants N.V. was the external auditor.
Executive Board
H.M.P.van Campenhout, chairman
A.J. Swartjes (resigning)
F.Th.J. Arp RA
P. Morley MSc.
Supervisory Board
A.J. van Puijenbroek, chairman
Mrs. M. Tiemstra
J.G. Drechsel
D.H.H.D. Ropers , secretary
98
other information
subsequent events
In mid February 2011, TMG entered investment commitments for
increasing the full color printing capacity of its Amsterdam facilities for an amount of approximately € 20 million.
99
independent auditor’s report
To the Annual General meeting of Shareholders of Telegraaf
Media Groep N.V.
report on the financial statements
We have audited the accompanying financial statements
2010 of Telegraaf Media Groep N.V., Amsterdam. The financial
statements include the consolidated financial statements and
the company financial statements. The consolidated financial
statements comprise the consolidated statement of financial
position as at 31 December 2010, consolidated statement of
comprehensive income, consolidated statement of changes in
equity and consolidated statement of cash flows for the year
then ended, and notes, comprising a summary of the significant accounting policies and other explanatory information.
The company financial statements comprise the company balance sheet as at 31 December 2010, the company profit and
loss account for the year then ended and the notes, comprising a summary of the accounting policies and other explanatory information.
management’s responsibility
Management is responsible for the preparation and fair presentation of these financial statements in accordance with
International Financial Reporting Standards as adopted by the
European Union and with Part 9 of Book 2 of the Dutch Civil
Code, and for the preparation of the executive board report
in accordance with Part 9 of Book 2 of the Dutch Civil Code.
Furthermore management is responsible for such internal
control as it determines is necessary to enable the preparation
of the financial statements that are free from material misstatement, whether due to fraud or error.
auditor’s responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in
accordance with Dutch law, including the Dutch Standards on
Auditing. This requires that we comply with ethical requirements and plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit
evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to
fraud or error.
In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for
the purpose of expressing an opinion on the effectiveness of
the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the
reasonableness of accounting estimates made by management,
as well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
opinion with respect to the consolidated financial statements
In our opinion, the consolidated financial statements give
a true and fair view of the financial position of Telegraaf
Media Groep N.V. as at 31 December 2010, its result and its cash
flows for the year then ended in accordance with International
Financial Reporting Standards as adopted by the European
Union and with Part 9 of Book 2 of the Dutch Civil Code.
opinion with respect to the company financial statements
In our opinion, the company financial statements give a true
and fair view of the financial position of Telegraaf Media
Groep N.V. as at 31 December 2010 and of its result for the
year then ended in accordance with Part 9 of Book 2 of the
Dutch Civil Code.
report on other legal and regulatory requirements
Pursuant to the legal requirement under Section 2:393 sub 5
at e and f of the Dutch Civil Code, we have no deficiencies to
report as a result of our examination whether the executive
board report, to the extent we can assess, has been prepared
in accordance with Part 9 of Book 2 of this Code, and whether
the information as required under Section 2:392 sub 1 at b-h
has been annexed. Further we report that the executive board
report, to the extent we can assess, is consistent with the financial statements as required by Section 2:391 sub 4 of the Dutch
Civil Code.
Deloitte Accountants B.V.
Signed by: P. Kuijpers
Hundreds of thousands of people each day view our video productions
online. They often draw more viewers than regular television programmes.
The expectation is that such use will rapidly increase and that the viewing
figures will continue to grow.
102
other information
provisions of the articles of association concerning the appropriation
of profit
In relation to the appropriation of profit, Article 33 of the articles
of association of Telegraaf Media Groep N.V. stipulates that:
1.Each year the Executive Board, subject to the approval of the
Supervisory Board and the Stichting Beheer van Prioriteitsaandelen Telegraaf Media Groep N.V. (TMG Preference Shares
Trust), determines the portion of the profit – the positive
balance on the income statement – that will be transferred to
reserves.
2.A dividend is made payable on the preference shares from the
profit remaining after the transfer to reserves in accordance
with the previous paragraph, at a rate equal to the 12-month
Euro Inter-bank Offered Rate (EURIBOR) effective on the
date on which the relevant preference shares are issued (“the
Rate”). The Executive Board then reviews the Rate annually,
commencing on the date one year after the date of issue of
the relevant preference shares and subsequently on the date
one year after the fixing of the Rate in the preceding calendar
year. The Rate is increased by three percentage points. The
dividend is determined on the basis of the average applicable
Rates in the relevant financial year, weighted by the number of
days for which the applicable Rates applied. If the Rate cannot
be determined on the date in question, the Rates will be reviewed on the next date on which the Rate can be determined.
The dividend on the preference shares will be paid only for the
number of days on which the relevant shares were actually in
issue in the relevant financial year.
3.If in any financial year the dividend on preference shares
as provided for at the second bullet point above, cannot or
can only partially be paid, due to a lack of sufficient profit,
the shortfall is paid from the distributable portion of equity.
The dividend is calculated on the paid-up portion of the nominal amount.
4.A dividend is subsequently paid to the holders of priority
shares in the amount of five percent of the nominal value of
their shares.
5.The profit then remaining is at the disposal of the General
Meeting of Shareholders. No additional dividend may however
be paid from this amount on the priority shares or the preference shares.
6.Distribution of profit is limited to the distributable portion of
equity.
7.If a loss is incurred in any one year, no dividend is then paid in
that year. In addition, in subsequent years a dividend may only
be paid after sufficient profit has been made to cover the loss.
Based on a proposal submitted by the Stichting Beheer van
Prioriteitsaandelen Telegraaf Media Groep N.V., the General
Meeting of Shareholders may however decide to settle such
a loss with the attributable portion of equity or also make a
dividend payable from the distributable portion of the equity.
8.Profit is distributed after the financial statements, showing
that the distribution is permissible, have been adopted.
9.The Executive Board, subject to the approval of the Supervisory Board and the Priority Share Management Trust, can
decide to proceed with the payment of an interim dividend,
provided that the interim statement of assets and liabilities
demonstrates compliance with the provision in paragraph
six. This statement is related to the capital position on at the
earliest the first day of the third month prior to the month in
which the decision to proceed with the payment of an interim
dividend is announced. This statement is prepared in accordance with the application of generally accepted standards.
The statement of assets and liabilities includes the amounts
that are to be included as reserves pursuant to the law.
The statement is signed by the members of the Executive
Board. If the signature of one or more of the members is missing, this is clearly stated together with the reason for this.
The statement of assets and liabilities is deposited within eight
days following the day on which the decision to proceed with
payment is made, at the offices of the commercial register.
10.The shares held by the company in its own capital do not
count in determining the distribution of profit.
103
Stichting Preferente Aandelen Telegraaf
Media Groep N.V. and Stichting
Beheer van Prioriteitsaandelen
Overview of all outstanding and potentially available defensive
measures to guard against a possible takeover of control of
Telegraaf Media Groep N.V. This summary identifies the circumstances under which these defensive measures would likely be
invoked.
The right to issue preference shares of Telegraaf Media Groep
N.V. is granted by the Stichting Beheer van Prioriteitsaandelen
Telegraaf Media Groep N.V. (TMG Priority Share Management
Trust).
The Stichting Preferente Aandelen Telegraaf Media Groep N.V.
has the right to acquire, in part or in whole, a number of preference shares in the capital of Telegraaf Media Groep N.V. for
the exercise of these rights that corresponds to 50% of the total
number of ordinary shares issued, for the exercise of (a portion
of) these rights.
Stichting Preferente Aandelen Telegraaf Media Groep N.V.
The purpose of the Stichting Preferente Aandelen Telegraaf
Media Groep N.V. (TMG Preference Shares Trust) is as follows:
1.To protect the interests of the Telegraaf Media Groep N.V.,
with registered office in Amsterdam, hereinafter also referred to as the company, of its affiliated companies and all
involved parties, whereby such measures are taken as required to protect to the maximum possible extent against
influences that could threaten the continuity, independence
or identity, in conflict with these interests.
2.To protect against the influence of third parties that could
affect the editorial independence, as well as the principles
that serve as the basis on which the opinion-forming publications of the companies within the group are edited.
The Stichting Preferente aandelen Telegraaf Media Groep N.V.
is an independent trust as defined in Section 5:71 subsection 1
under c of the Financial Supervision Act (Wft).
The Trust attempts to achieve this goal by:
• acquiring preference shares in the company and by exercising the rights associated with these shares;
• by exercising other rights that are granted to the Trust pursuant to the law, articles of association or an agreement.
Stichting Beheer van Prioriteitsaandelen Telegraaf Media
Groep N.V.
The objective of the Management Trust is to acquire and manage the priority shares of the company and, on this basis,
to ensure the continuity of the company’s management, ward
off any influences on the company’s management that could
affect the independence of the company in conflict with its
interests and to promote sound policy in the interests of the
company.
The Trust takes the purpose for which the preference shares
may be issued into consideration in relation to the provisions
stated under 1) above, in accordance with the explanation
provided in support of the proposal to amend the Articles of
Association approved by the General Meeting of Shareholders
of the company on 20 December 1983. The disposal, encumbrance or in any other way disposing of shares fall outside such
purpose, except:
• disposal to the company itself or to an affiliated group company to be designated by the company;
• collaboration in the repayment and withdrawal of shares;
• encumbrance of shares (without the transfer of voting rights)
with a view to contracting a financial loan or credit for the
sole purpose of paying up (part of) the nominal value of preference shares in the company to be acquired by the Trust.
On 21 March 2008, Telegraaf Media Groep N.V. authorised the
Trust to submit a request for an inquiry, within the meaning of
Article 2:346c of the Dutch Civil Code.
The management board of the Trust consists of one chairman
and four members. As at 31 December 2010, the composition of
the board is as follows: S.E. de Jong (Chairman), A. den Bandt,
A.H.M. van Roosmalen, J.H.M. Lindenbergh and J.P. Witsen Elias.
No preference shares were outstanding on the balance sheet
date.
The authorities associated with the priority shares include the
decision to issue shares, set the number of directors and the
right to propose an amendment to the Articles of Association
or dissolution of the company before the General Meeting of
Shareholders can decide on such matters.
The 960 priority shares are held by the Stichting Beheer van
Prioriteitsaandelen Telegraaf Media Groep N.V., whose management board as at 31 December 2010 consists of
E.H. van Puijenbroek (Chairman), M. Tiemstra (Secretary), prof.
dr.W. van Voorden and A.R. van Puijenbroek.
104
annual report 2010 of Stichting
Administratiekantoor van Aandelen
Telegraaf Media Groep N.V. (TMG) is a listed company.Depositary receipts for shares in TMG are traded via the Euronext
Amsterdam N.V.
One of the purposes of the Stichting Administratiekantoor van
aandelen Telegraaf Media Groep N.V. is to issue convertible
bearer depositary receipts for shares in exchange for which
the Trust acquires and holds ordinary shares in its own name,
for administration. The Trust administers the acquired ordinary
shares and exercises the rights associated with these shares,
including the voting rights.
In exercising the rights associated with the shares, the Trust
will primarily focus on the interests of the holders of depositary
receipts with due consideration of the interests of TMG and its
affiliated companies.
The issue of depositary receipts for shares is a measure designed to prevent the absence of shareholders at the General
Meeting of Shareholders from resulting in a minority of shareholders, by happenstance or otherwise, that is subsequently
able to take over control of the meeting.
Shareholders are entitled to attend the General Meeting of
Shareholders, and to speak and vote at this meeting. Holders
of depositary receipts are entitled to attend and speak at this
meeting. Holders of depositary receipts may obtain a proxy
for the duration of the meeting from the management board
of the Stichting Administratiekantoor van aandelen Telegraaf
Media Groep N.V. (TMG Share Administration Trust) that entitles them to vote. TMG’s depositary receipts for shares can be
converted without limitation. The issue of depositary receipts
for shares therefore does not constitute an anti-takeover measure for TMG.
The notes explaining the deviations from the Corporate Governance Code may be found on page 37 of this annual report.
During 2010, the number of convertible depositary receipts for
shares in the TMG issued by the Stichting Administratiekantoor van aandelen Telegraaf Media Groep N.V. rose by 119,740
depositary receipts and amounted to 29,176,077 (at a nominal
value of € 0.25) as at 31 December 2010, corresponding to a
nominal amount of € 7,294,019.25. An equal number of shares
were administered by the Trust against these depositary receipts.
On 15 April 2010 several meetings took place. The items
discussed during the regular management board meeting
(minutes available on the Trust’s website http://administratiekantoor.tmg.nl) include the Trust’s financial statements and
report for the 2009 financial year, and the Trust’s finances.
TMG’s financial statements and the proposed dividend for 2009
were extensively discussed with Mr A.J. Swartjes, TMG’s CEO.
The agenda of the General Meeting of Shareholders held on
22 April 2010 was also discussed at this meeting, and preliminary discussions were held concerning the follow-up Meeting of
the Holders of Depositary Receipts for Shares.
The Meeting of the Holders of Depositary Receipts for Shares
subsequently took place in the afternoon (minutes available on
the Trust’s website http://administratiekantoor.tmg.nl).
Agenda items included a discussion of the minutes of the
Meeting of Holders of Depositary Receipts for Shares held on
16 April 2009, a review of the TMG N.V. General Meeting of
Shareholders held on 22 April 2009, the activities of the management board during the year and preparations for the TMG
N.V. General Meeting of Shareholders held on 22 April 2010.
The chairman identified a number of questions that the management board wished to table during the upcoming meeting
of shareholders.
Only two holders of depositary receipts for shares were present
at this meeting. At that point the Trust was in the possession of
over 60% of the outstanding shares.
In the meeting with the holders of depositary receipts for
shares, the management board announced that it was going to
deliberate on the meeting of holders of depositary receipts for
shares in 2011. The board subsequently evaluated the meeting
of holders of depositary receipts for shares. It was agreed that
the notice for the 2011 meeting of holders of depositary receipts for shares will emphasise that the purpose of the meeting is to prepare for the TMG N.V. General Meeting of Shareholders.
The TMG Annual General Meeting of Shareholders was held on
22 April 2010 in Amsterdam (www.tmg.nl). The Trust’s management board issued proxies with full voting rights for the
duration of the meeting to the holders of depositary receipts
for shares present during the meeting. The management board
represented 25.5%, while the holders of depositary receipts for
shares with proxies represented 35.5% of the votes present
during this meeting The chairman of the Trust’s management
board complimented the Executive Board on the cost reductions that had been launched, which made the result quite tol-
105
erable, and the fact that the bonus over 2009 had been foregone. The objective of achieving a 15% margin was criticised.
This objective is subject to conditions, such as the recovery of
the economy and sufficient growth in digital activities, while no
time limit has been set. Furthermore, the management board
expressed its doubt about the possibility of offsetting the loss
in revenues due to the decline in circulation by an increase in
rates.
It was noted that digital revenues only comprise 6% of the
total and that the annual report does not convey a sense of
urgency in terms of making digital a real pillar of the company’s
business operations. What is the Executive Board’s focus in
terms of the development of digital activities and is it worth
contemplating the idea of strengthening the Executive Board
with another person who is digitally well-grounded and focused, be it after the departure of Mr Swartjes as CEO next
year or as a fourth member of the Board?
The management board voted for the adoption of the 2009
financial statements, the proposed profit appropriation, and
the discharge of the Executive Board of responsibility for the
policies pursued and the discharge of the Supervisory Board
of responsibility for the supervision exercised during the
year under review. The Trust voted for the appointment of
Mr D.H.H.D Ropers as a member of the Supervisory Board.
Mr Ropers’ independence was questioned, now that Cyrte
Investments has major interests in TMG as well as bol.com,
where Mr Ropers is Managing Director. The Trust voted for
Deloitte as the Group’s auditor. The proposal to authorise the
Executive Board to purchase company shares and the extension of the authority of the Stichting Beheer van Prioriteitsaandelen TMG [Priority Share Management Trust] to issue
ordinary shares and the granting of rights to acquire shares
and to restrict or rule out preferential right of subscription to
ordinary shares (including the granting of rights to acquire
ordinary shares), was also supported by the Trust.
The management board held its regular autumn meeting on
17 September 2010 (minutes available on the Trust’s website
http://administratiekantoor.tmg.nl). Mr F.Th.J. Arp, CFO of
TMG’s Executive Board provided a briefing on the Group’s
results in the first six months of the year, as presented to a few
investor relations and several major shareholders as well. The
following items were discussed during this meeting: TMG’s
semi-annual figures, the Trust’s finances, the minutes of the
meeting of 15 April 2010 and the draft minutes of TMG’s shareholders meeting, the appointment of Mazars as the Trust’s
auditor, changes to the Trust’s website and the date for the
2011 Meeting of Holders of Depositary Receipts for Shares.
The Special General Meeting of Shareholders of TMG took place
on 7 December 2010. The Trust supported the proposal to
amend the remuneration of the Executive Board and to amend
TMG’s articles of association.
The remuneration of the board members of the Trust consists
of € 8,000 per year for the Chairman and € 6,000 per year
for the other board members, paid per calendar year in arrears.
The annual costs of the activities of the Share Administration
Trust primarily consist of expenses related to stock exchange
listings and processing costs, for a total of € 30,171, costs for the
Meeting of Holders of Depositary Receipts for Shares, including advertising expenses, totaling € 478, costs for maintaining
the Trust’s website, totalling € 5,257 and administration costs
amounting to € 3,570. The total expenses of the Trust over
2009 amounted to € 71,813 (2009:€ 61,344).
The management board of the Stichting Administratiekantoor
van aandelen Telegraaf Media Groep N.V. is independent in the
sense of Article 2:113(3) of the Dutch Civil Code and consists of
the following members, including mention of the former and/or
current positions held:
W.M. Lammerts van Bueren, Chairman:
Emeritus Professor in International University Collaboration/
Economic Sciences EUR
W.P. Moleveld, Vice Chairman:
Emeritus Professor of Accounting Nyenrodeusiness University
E.S. Schneider, Secretary:
Independent management consultant, in particular for publishers and printers (until 2006)
W. Ruijgrok:
Former Director of the Confederation of Netherlands Industry
and Employers (VNO-NCW)
J.F.H.M. van Exter:
Managing Director, Corus Services Nederland B.V.
Stichting Administratiekantoor van aandelen
c/o Basisweg 30
1043 AP AMSTERDAM
106
about TMG
profile
TMG (Telegraaf Media Groep) is one of the largest Dutch media groups. TMG’s three publishing groups, Telegraaf Media
Nederland, Keesing Media Group and Sky Radio Group have
market leadership positions in daily newspapers, magazines,
puzzle magazines, online and offline media and radio.
TMG is the largest newspaper publisher in the Netherlands with
the leading national dailies De Telegraaf and Sp!ts and has a
strong position in the Randstad area and surroundings with
regional dailies and (free) local papers.
TMG has a strong market position in the Netherlands in the
magazine market on the basis of titles aimed at specific target groups for instance in the segments of Entertainment,
Automotive and Puzzles.
Keesing Media Group is the market leader in puzzle booklets.
The company is also developing a position in the market of casual games.
In the Dutch radio market, TMG holds a majority interest in
Sky Radio (87.3%), the market leader among commercial radio
stations.
TMG is furthermore increasingly active in new, mostly digital,
forms of media via the (mobile) Internet, in combinations of
various media types (cross media) and via TMG’s social network
Hyves.nl.
In the international scene, TMG holds a 6% interest in ProSiebenSat.1 Media AG, one of the largest European radio and television enterprises. In the Netherlands the stations SBS6, Net5 and
Veronica belong to ProSiebenSat.1 Media AG.
Outside the Netherlands, TMG is active in France, Belgium,
Denmark and Sweden with puzzle magazines.
TMG employs approximately 3.000 FTE’s.
TMG is listed at NYSE Euronext Amsterdam and is part of the
AScX Index.
core values
TMG is a self-confident enterprise with a strong identity.
The enterprise is focused on the long term with media products aimed at the multimedia information and spare time
market of consumers.
TMG is solid and financially strong. The company’s policy reflects
its core values professional, change-oriented and committed,
while maintaining integrity in all areas. Everything is focused on
responding to client desires and needs.
TMG is a reliable and committed employer. Employees are offered extensive development opportunities and good income.
In exchange, TMG expects its employees to proactively handle
changes, to further develop themselves and to contribute to the
development of the enterprise in a drastically changing marketplace in a committed, and professional way.
TMG wants to provide objective and independent information and entertainment to consumers, using various medium
types, thus ensuring content is accessible anywhere at any time.
Intentional, focused on the interests of the general public or
narrowly defined target groups, informative and entertaining.
TMG adopts a client-oriented approach in relation to suppliers of
products and services. TMG wants to support them by optimising contacts with existing and potential clients and by creating
greater flexibility in this respect, through divergent media forms.
In terms of our shareholders, continuity, profitability and integrity are key.
TMG is solidly financed. The company is for its operating result
dependent on the Dutch economy.
mission
TMG is actively engaged in getting in touch and creating
loyalty among general and/or specific public interest groups
and communities and in exploiting their multimedia leisure
time consumption:
• By getting in touch with users, readers, listeners and viewers through a targeted offering of general and customised
media products, by leveraging the reach of strong TMG
brands and by cross promotion in various media platforms
and via social networks.
• By creating loyalty by providing attractive content and
applications in the area of information and entertainment,
including news, music, puzzles and games. Made for and
by users. And by utilising the possibilities offered by social
networks.
• By exploiting the reach among public interest groups.
The outcome is revenues from consumers and advertisers,
which diverge more and more from the traditional revenue
streams.
107
vision and ambition
strategy
TMG wants to organise the extremely broad multimedia consumer offering that bombards the consumer, in such a way that
it arrives in a well-organised and precisely targeted manner.
This way of targeting is important for consumers and allows advertisers to grab the consumer’s attention with a clear focus.
TMG’s enterprise strategy consists of the following elements:
• TMG seeks growth by exploiting platforms of existing
and new media, involving service to broad public interest
groups, whereby advertisers are offered reach on the basis
of integrated media concepts centred on information and
entertainment, including news, music, puzzles and games
and social networks.
• To expand reach, TMG is developing a portfolio of different types of media companies that complement print media
and/or are innovative in relation to the publishers of print
media (digital).
• Reaching the same general or specific public interest groups
and communities via multiple media platforms creates opportunities for synergy, varying from integrated product
concepts and propositions that combine ‘old’ and ‘new’
media to the cross-promotion of strong brands.
• Reducing fixed costs in core operating units is crucial for
TMG to be able to adapt to the new reality and to be able to
continue to invest in growth in the areas of print and digital.
On the one hand TMG reaches primarily the 35 year and older
consumer group - the ‘digital immigrants’ - for its advertisers.
This target group tends to make extensive use of traditional media – daily newspapers, radio, TV – and TMG enjoys a
prominent position in each of these sectors. TMG is efficient in
collecting and creating appealing content for this target group
in the area of news, music and games.
On the other hand TMG is also an innovative media enterprise
and grows by focusing on the target group of the future: the
‘digital natives’ (mostly younger than 35 years of age), who
spend much of their media time on the internet in general and
using ‘social media’ in particular. TMG intends to become the
trend-setting media enterprise for the internet generation.
TMG provides advertisers with an opportunity to efficiently
reach this target group.
The company is convinced that success follows from the right
approach to the most important parts of traditional activities
leading to greater efficiency and by carefully positioning itself
in the new media world as a means of realising essential growth.
targets
Mainly in Dutch market TMG is focused on a profitable exploitation of media products reaching consumers during their
multi-media leisure time spend:
• The recurring EBITA margin rose from 8.1% in 2009 to 10.9% in
2010 thanks to measures taken in 2010 and earlier.
• Mid 2008, TMG stated the intention to increase the recurring
EBITA margin with yearly 10% in the three years to come.
Given the economic circumstances during 2009 that target
turned out to be impossible to reach. In 2010 an important
step has been taken regarding the original target. As from
2008 the yearly recurring EBITA margin developed as follows:
9.1%, 8.1% and 10.9%. The realisation of the original target is
therefore again almost on scheme.
• TMG is steadfast in the goal of achieving a 15% margin eventually. To achieve this, TMG is reliant not only on further autonomous growth in digital activities, but also on acquisitions of
relatively high performing digital activities.
108
about TMG
Reaches an audience of over 8.8 million
Dutch people with more than 250 titles –
online content, magazines, regional
newspapers, free local newspapers and
daily newspapers.
magazines
supply & demand
In total more than 3 million objects
are on offer on various supply and
demand sites. Speurders.nl for
instance offers 400,000 different
books; 600,000 tickets for events
are sold via Telegraaftickets.nl.
Supply and demand sites
Botentekoop.nl (Boats for Sale),
Botenbank.nl and magazine
Boten (Boats) have more than
22.000 boats on offer.
27% of Dutch women reads at
least one of the magazine titles.
For all Privé readers to attend
the same concert would require
Amsterdam’s ArenA to be leased
on 34 different occasions.
newspapers
The newspapers reach almost
4 million readers every day.
Our market share is 42%.
3.7 million households receive
one of the free local newspapers
each week.
Hyves
THE BIGGEST SOCIAL NETWORK IN
THE NETHERLANDS REACHES MORE
THAN 8 MILLION UNIQUE VISITORS AND
HAS 9 MILLIONS DUTCH USERS.
audiovisual
e-mail
Commercial messages
are sent on a regular
basis to 3,5 million
unique e-mail addresses
from 28 titles.
The Pilarczyk Mediagroep
produced 7 different TV
programmes each week in 2010.
Over 185 episodes were
produced throughout the year,
each with an average of over
250,000 viewers. In 2010
Telegraaf Media Nederland |
Video Media produced more
than 200 hours of video for TV
and online platforms, dozens of
formats and more than
100 episodes for public as well
as commercial broadcasters.
internet
With 8.7 million unique
visitors the TMG network
of sites reaches 64% of
all Dutch people.
109
mobile
Mobile internet is rapidly gaining in popularity. TMG’s mobile
platforms and apps reach an audience of more than
975.000 unique visitors per month and realises more than
120 million page views. Mobile news platform Telegraaf.mobi
attracts mobile visitors and generates about 50 million page views
whereas the iPhone app generates 40 million page views.
The reach of the Telegraaf iPad app continues to grow every month
and currently accounts for more than 10 million page views.
events
Various events are organised each year.
Automotive events, Singles parties,
job fairs, entrepreneur meetings and
events especially designed for women.
Keesing Media Group
puzzles & games
is a market leader in puzzles and
games. Keesing publishes over 100
puzzle titles and is active in digital
puzzles and games.
More than 65% of the Netherlands’
population over 15 years of age likes
to puzzle. This means that in no less
than 4.9 million households there
is someone who works on a puzzle
from time to time and generally this
is a puzzle published by Denksport.
With more than 50 million games
played per month, Zigiz is one of
the most often-visited casual
games platforms.
radio
More than 5 million unique listeners on a weekly
basis tune into at least one of the three radio brands:
Sky Radio 101 FM is the non-stop music station of
the Netherlands; Radio Veronica is in the top three
stations tuned into by men; and Classic FM is the
largest special interest radio station. Three radio
stations, eight online stations: 110,880 minutes of
radio per week.
Sky Radio Group
reaches more than 5 million
unique listeners per week
with three radio stations
and eight online stations.
cross media
Our unit Cross media knows what’s on in society.
This knowledge is part of their DNA, and is being used in
developing advertiser campaigns. Cross media bridges brands
and society. It is called Societal Inside Based Campaigning.
This results in creative concepts which are beyond advertising.
They create events in media.
TMG
TMG
TMG
Annual
annual
jaarverslag
Report
report 2010
111
about TMG
main structure TMG
March 2011
Executive Board:
• mr. H.M.P. van Campenhout
- CEO (as of 16 February 2011)
• drs. F.TH.J. Arp RA
- CFO
• P. Morley msc
- COO
• drs. A.J. Swartjes
Participating Interests
(CEO up to 16 February 2011)
Corporate Staff
Sky Radio Group
Telegraaf Media
Nederland
Keesing Media Group
Subsidiaries and
participating
Interests
Landelijke Media
•
HDC Media
•
Holland Combinatie
•
Subsidiaries and
participating
Interests
Subsidiaries and
participating
Interests
Other activities
Other media activities,
including Hyves
•
Other activities:
Telegraaf Media ICT
Telegraaf Drukkerij Groep
TMG Distributie
Shared Service Center
TMG
TMGAnnual
annualReport
report 2010
113
about TMG
key figures
2010*
2002
2001
Shareholders’ equity x € 1,000 **
531,075 465,962 411,576 866,815 498,041 530,468 444,643 428,333 454,079
464,761
TMG equity in percentage of the
total equity and liabilities 66.7%
61.1%
54.0%
70.3%
47.8%
68.8%
65.2%
64.5%
62.5%
60.6%
Current ratio
0.72:1
0.78:1
0.7:1
2.64:1
1.04:1
1.08:1
1.23:1
1.06:1
0.98:1
0.72:1
Current gearing
2.00:1
1.57:1
1.17:1
2.37:1
0.91:1
2.20:1
1.87:1
1.81:1
1.67:1
1.54:1
Revenue TMG x € 1,000
Cash flow from operating
activities x € 1,000
Net result x € 1,000 **
592,297 611,840 684,204 738,795 784,460 736,686 686,853 683,556 704,462
822,220
59,569
81,826
2009*
2008*
2007*
49,252 64,962 62,130
70,505 -359,988 400,097
2006*
60,195
49,599
2005*
2004*
73,600 64,970
65,428 22,125
2003
62,172
-25,765
33,059
-4,913
74,992
-29,510
Net result TMG in percentage
of the total revenue
13.8%
11.5%
-52.6%
54.2%
6.3%
8.9%
3.2%
-3.8%
-0.7%
-3.6%
Operating result in percentage
of the total revenue 3.8%
-0.5%
-5.4%
-3.8%
-2.1%
7.2%
1.1%
3.5%
3.1%
1.2%
Average total revenue
per employee (fte) Personnel end of year (fte)
207,751 204,743 207,272 201,590 188,981 170,632 157,752 153,298 150,205
2,851
2,988
3,278
3,594
3,782
4,362 4,316
4,357
4,553
151,561
5,393
Return on equity Pay out ratio
15.4%
26.3%
15.1%
23.7%
-87.5%
p.m.
46.2%
11.9%
9.9%
50.0%
12.3%
35.3%
5.0%
23.6%
-6.0%
p.m.
-1.1%
p.m.
-6.4%
p.m.
Per TMG share with a nominal value of
€ 0.25 (rounded to whole euro cents)
Shareholders’ equity Cash flow from operating activities Net result Dividend
11.12
1.25
1.71
0.45
9.76
1.03
1.48
0.35
8.62
1.35
-7.49
0.35
17.43
1.24
8.00
1.00
9.96
1.20
0.99
0.50
10.10
1.40
1.25
0.44
8.47
1.24
0.42
0.30
8.16
1.18
-0.49
0.11
8.65
0.63
-0.09
0.11
8.85
1.43
-0.56
0.11
Lowest share price Highest share price Closing share price as at 31 December
14.52
16.45
14.95
8.95
14.80
13.14
8.86
24.86
12.45
19.69
26.87
25.00
19.00
23.00
19.85
17.06
20.64
18.25
16.05
18.90
18.25
13.00
19.00
17.99
13.00
24.47
15.44
14.00
22.90
17.09
* Based on IFRS principles
**Attributable to Telegraaf Media Groep N.V.
credits
a publication of Telegraaf Media Groep N.V., Amsterdam
editorial: Concern Communicatie & Investor Relations
editorial financial information: Concern Financiën enAdministratie
layout: RadeMakkers
typeface: Gotham, Bodoni
printing and binding: Stadsdrukkerij Amsterdam N.V.
paper: Go! Matt, cover: 250 grams | inside: 135 grams
Amsterdam, March 2011

TMG annual report 2010

Transcription

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