Annual Report 2005

JAARVERSLAG 2005
ILLUSTRATIONS IN THIS ANNUAL REPORT
The cover and the illustrated pages of this report reflect the strategy of Telegraaf Media Groep. The
basic principle of this strategy is to increase TMG’s share of media consumption. We want to achieve
this by penetrating new markets and by optimising and innovating existing products and services.
Furthermore, TMG seeks opportunities to export its expertise to new geographical markets, and the
group invests strategically in new activities or increases its holdings in existing participating interests.
telegraaf media groep n.v.
Visitor address
Basisweg 30, Amsterdam, the Netherlands
+31 (0)20 - 585 9111
Mail address
P.O. Box 376, 1000 EB Amsterdam, the Netherlands
This annual report is available in English at
www.tmg.nl
For more information:
corporatecommunication@tmg.nl
contents
4
annual report
4
5
6
Composition of Managing Board
Composition of Supervisory Board
Report of the Supervisory Board
to shareholders
Consolidated key figures
Foreword by the Managing Board’s chairman
• Prospects
Consolidated data
Publishing activities
• National newspapers
• Regional newspapers
• Free local papers
• Magazines
Other activities
Facilities services companies
Participating interests
Corporate Governance code
9
11
15
17
25
25
29
31
33
37
38
40
43
47
47
48
50
51
52
65
103
104
107
financial statements
Consolidated income statement
Consolidated balance sheet
Consolidated cash flow statement
Consolidated statement of changes
in shareholders’ equity
Principles of consolidation, valuation
and determination of the result
Notes to the consolidated financial statements
Separate income statement
Separate balance sheet
Notes to the separate financial statements
119
119
121
122
123
124
129
130
other information
Auditor’s report
Provisions in the Articles of Association
concerning the appropriation of profit
Stichting Beheer van Prioriteitsaandelen
Telegraaf Media Groep N.V.
Stichting Preferente aandelen
Telegraaf Media Groep N.V.
Publications and activities of Telegraaf
Media Group as at 31 December 2005
Directors of subsidiaries
as at 31 December 2005
Key figures as at balance sheet date
4
ANNUAL REPORT
2005
members of the executive board
(AS AT 31 DECEMBER 2005)
A.J. Swartjes (1949)
CEO/Chairman
J. Olde Kalter (1944)
Member of the Executive Board
Mr A.J. Swartjes has been a director since
1 January 1991, after having occupied several
positions in the company since 1978. During
the period from 1974 to 1978, he was attached
to Reader’s Digest and to Colgate/Palmolive.
Mr Swartjes studied economics at the Erasmus
University in Rotterdam.
Mr J. Olde Kalter was appointed director on
1 January 1995. He is is editor-in-chief of daily
newspaper De Telegraaf as well. He has been
with De Telegraaf since 1970 and has held
various positions within the company, including
being temporarily based in the United States.
Mr Olde Kalter is a University of Utrecht law
graduate.
F.Th.J. Arp RA (1954)
CFO
Mr F.Th.J. Arp became a director of the company
on 1 July 1997. From 1991 to 30 June 1997, he
was one of the partners of Deloitte & Touche
Accountants. Prior to this, he was already active
in the field of accountancy. Mr Arp studied
business economics and accountancy at the
Erasmus University in Rotterdam.
ANNUAL REPORT
2005
5
members of the supervisory board
(AS AT 31 DECEMBER 2005)
A.J. van Puijenbroek
Chairman
Age
Nationality
Profession/main position
Other positions
First appointment
Current term
Prof W. van Voorden
Vice Chairman
Age
Nationality
Profession/main position
58
Dutch
Director of N.V. Exploitatiemaatschappij Van Puijenbroek
Chairman of Stichting Beheer van Prioriteitsaandelen
Telegraaf Media Groep N.V. (TMG Priority share management trust)
Secretary of Stichting Preferente Aandelen
Telegraaf Media Groep N.V. (TMG preference shares trust).
15 - 05 - 1975
2003 - 2007
First appointment
Current term
63
Dutch
Chairman CTZ (College Toezicht Zorgverzekeringen =
supervisory committee for health insurance)
Emeritus professor at Erasmus University Rotterdam
Emeritus professor at Tilburg University
Supervisory directorships at Batenburg Beheer N.V. and
Panteia B.V.
04 - 06 - 1997
2005 - 2009
H.L. Weenen
Secretary
Age
Nationality
First appointment
Current term
61
Dutch
26 - 06 - 1980
2004 - 2008
Mrs M. Tiemstra
Age
Nationality
Profession/main position
First appointment
Current term
51
Dutch
Executive board member at Eureko B.V.
05 - 06 -2003
2003 - 2007
L.G. van Aken
Age
Nationality
Other positions
64
Dutch
Board member of Stichting Beheer van Prioriteitsaandelen
Telegraaf Media Groep N.V. (TMG Priority share
management trust)
Board member of Stichting Administratiekantoor
Boekanier (administrative / managerial office)
Board member of Stichting Administratiekantoor
van aandelen in H.J. Wols Holding B.V. (share trust office).
Chairman of Stichting-Telegraafpensioenfonds (Telegraaf
pension fund trust)1959
30 - 05 - 2002
2002 - 2006
Other positions
First appointment
Current term
6
ANNUAL REPORT
2005
report of the supervisory board
to shareholders
We hereby present the report, the balance
sheet as at 31 December 2005 and the income
statement for 2005 with the notes as compiled
by the Managing Board.
The financial statements have been audited and
approved by Deloitte Accountants B.V. in Amsterdam, as is shown by the certification, which
is included in this report. The financial statements were discussed with the auditor during
the annual meeting and subsequently adopted
by us.
In accordance with the reinforced recommendation right (Section 396:1 of Part 9, Book 2 of
the Netherlands Civil Code) the central works
council has recommended the reappointment
of Prof. W. van Voorden as supervisory director
of Telegraaf Media Groep N.V. In accordance
with this recommendation, the general meeting
of shareholders on 20 April 2005 reappointed
Mr. Van Voorden.
The Supervisory Board has met the Managing
Board seven times during the past year and has,
among other things, devoted attention to the
strategy and the organization, the risks connected with the company (see also page 23 of
this annual report), and the financial issues.
During the financial year, particular attention has been paid to the elaboration of the
components in the strategy of Telegraaf Media
Groep N.V, to the composition of the Managing Board, to the exchange of the shares in SBS
Broadcasting B.V. for shares in SBS S.à.r.l., to
increasing the minority interest in Expomedia
Group Plc, to purchase of the remaining shares
in Media Groep West B.V. and Mobillion B.V., to
the planned participating interest in Sky Radio
Ltd, and to the planned sale of Media Groep
Limburg B.V. and Grafisch Bedrijf Media Groep
Limburg B.V. Much attention has also been paid
to the planned cost savings, including those
from introduction of a rate card for the facilities
services operations within the group and to the
reduction of the workforce.
We have consulted the external auditor,
Deloitte, in two meetings.
At a meeting in which the Managing Board did
not participate, we have reviewed our own performance and the relationship with the Managing Board and discussed the composition and
performance of the Managing Board.
ANNUAL REPORT
Mr W.O. Kok, member of the Executive
Board (COO), resigned from his position with
Telegraaf Media Groep N.V. as effectively from
31 August 2005. The reason was a difference in
views within the Executive Board concerning
the policy to pursue for Telegraaf Media Groep
N.V. We are grateful to Mr Kok for his efforts
for Telegraaf Media Groep N.V during the many
years that he has been associated with the
group.
The Supervisory Board has used its remuneration policy to establish the remuneration of the
Executive Board. The individual remuneration
of the members of the Executive Board has
been incorporated in the 2005 annual report.
During the year under review, one of the
members of the Supervisory Board attended
a meeting with the Central Works Council.
We would like to express our appreciation to
the Executive Board and the employees for
the way in which they have performed their
duties in 2005.
2005
We recommend that:
1. The financial statements for 2005 are approved in accordance with the documents
presented.
2. The Executive Board be discharged from
responsibility for the policy pursued
during 2005.
3. The Supervisory Board be discharged from
responsibility for the supervision conducted
in 2005.
4. The dividend for the 2005 financial year
for each share of € 0.25 par value be fixed
at € 0.44 in cash (2004: € 0.30 cash for each
share of € 0.25 par value).
5. The dividend be made payable on 27 April
2006 at ABN Amro Bank N.V. in Amsterdam.
On behalf of the Supervisory Board
A.J. van Puijenbroek, Chairman
Amsterdam, 15 March 2006
7
ANNUAL REPORT
2005
9
consolidated key figures
telegraaf media groep n.v.
2005
2004
736,686
694,320
Operating result
53,235
26,304
Balance of financial income and expenses
31,730
51,526
Result before tax
84,965
77,830
Corporation tax
19,876
10,049
Net result
65,089
67,781
-339
72
65,428
67,709
To be added to/released from reserves
42,328
51,959
Dividend pay-out (from result)
23,100
15,750
35%
23%
73,600
66,306
Net result
1.25
1.29
Cash flow from operational activities
1.40
1.26
Dividend
0.44
0.30
4,362
4,316
Amounts are given in thousands of euros
Net turnover
Minority interest share
Net result for appropriation by shareholders of
Telegraaf Media Groep N.V.
Proposed result appropriation
(not accounted for in the financial statements)
Pay-out ratio
Cash flow from operational activities
Per share:
Number of employees at year-end (FTE)
ANNUAL REPORT
2005
11
foreword from the chairman
of the executive board
investing in change
Under continuing difficult economic conditions,
Telegraaf Media Groep N.V. (TMG) took
significant steps in pursuing an accelerated
strategy during the past year. Optimisation,
innovation and internationalisation continue
to be the main topics for this. Our aim is to
increase our share in media consumption.
With not only print media continuing as the
foundation of TMG as always, but also by
means of digital media, radio and television,
in the Netherlands and in new markets such
as Sweden and the Ukraine.
Economic uncertainty
From an economic perspective, 2005 was
another difficult year. Despite this, turnover
rose by 6.1% to € 736.7 million during 2005.
The increased turnover mainly originated from
newly acquired activities. The operating result
increased from € 26.3 million to € 53.2 million.
However, when excluding exceptional items in
both years, including book profits, reorganisation
expenses, and a release of pension and early
retirement provisions, the operating result
actually decreased by approximately 14% to
€ 32.6 million. The net profit, accounted on
basis of IFRS-principles, amounted to € 65.4
million, a small decline compared to 2004
(€ 67.7 million). The profit per share amounted to
€ 1. 25, compared with € 1.29 in 2004. A dividend
of € 0.44 in cash is proposed (2004: € 0.30).
Declining circulation figures and advertising sales
at the daily newspapers and periodicals were
main causes of the diminished result. The degree
to which circulation and sales were under pressure differed per type of medium and per title.
Circulation and advertisements
under pressure
The circulation of the Dutch daily newspapers
decreased by 3.7% to a little over 3.9 million
between 1 October 2004 and 30 September 2005.
For national daily newspapers, the decrease was
3.2%, for the regional papers, 4.1%. The distributed circulation of De Telegraaf daily newspaper
fell by 2.7% to 732,073 copies. The regional daily
newspapers of HDC Media performed relatively
well with a drop in circulation of less than 2%.
The advertising volume in all Dutch daily newspapers, excluding the Sunday papers, decreased
by 9% in 2005. In this context, the advertising
volume in national daily papers fell by 4% and
in regional daily newspapers by 11%. The drop
in advertising volume in De Telegraaf was 3%,
excluding the Sunday paper. The regional daily
newspapers of HDC Media did relatively well in
this area, with their advertising volume remaining
the same as in 2004. The advertising volume at
Media Groep Limburg (MGL) dropped by 9%.
These figures do not include the developments
of the free daily newspapers, of which Sp!ts
is one. The average circulation of Sp!ts rose in
2005, with 6.7% to 382.000. The current daily
circulation is 430,000 copies, without taking
holiday periods into account. Sp!ts was also the
only one of the national and free daily papers to
show a strong increase in total media spending.
Its market share increased from 6.5% in 2004 to
8.5% in 2005, while the advertising volume rose
by 24%.
At the periodicals, circulations and advertising
sales were under pressure in 2005.
Partly due to growing competition caused by
12
ANNUAL REPORT
2005
the introduction of many new titles, there was
still no improvement in advertising volumes.
The circulations of most of the titles of Telegraaf
Tijdschriften Group (TTG) stagnated. A significant
exception was CosmoGIRL!, which saw the
circulation climb by 26% to an average of more
than 95,000.
There was, however, strong growth in visits
and revenues on internet. The average number of
page views across the entire Telegraaf network
including the classified sites speurders.nl (small
ads), autotelegraaf.nl (cars) and vacaturekrant.nl
(holidays and travel) more than doubled over
the whole of 2005 to 8.9 million per day. The
advertising revenues rose by 49% to € 13.1 million.
Strategic focus
The market developments in 2005 confirm the
trend-related development in the media world.
Sales and circulations of print media are under
pressure. New media, radio, internet and television, continue to gain ground. There are major
dynamics in the market, which, apart from
threats, also present very many opportunities
for media companies such as TMG.
The market for media consumption is an enormous market. A market in which TMG, as one
of the largest media companies in the Netherlands, also has a very strong position. A position
that is based on strong brands, with top positions in the market, and employees with very
extensive experience. That market position of
TMG is, however, based mainly on print media.
The share of this in media consumption and
advertising spending has been declining for
years. In order to be able to increase its share
in media consumption, TMG wants to invest
in types of media that do show growth, such
as internet, radio and television, and in new
products and means of communicating. Therefore,
next to cost reductions, TMG invests in existing
products benefiting from its publishing expertise
in other countries and broadening the portfolio
with multimedia products. Significant progress has
been made in each of these areas during 2005.
Optimising print media
Constant control of costs remains essential for
the print media. To do things differently and
cheaper is the challenge here. TMG has booked
great success in the past with a market approach
in print products in which the technical quality
was foremost. Printing capacity, print quality
and distribution were critical success factors.
The market conditions accordingly make it
essential to achieve lower costs and economies
of scale. Lower circulations and advertising
revenues add to this pressure. The provision of
detailed insight into all cost components of the
facilities services (ICT, printing and distribution)
must enable publishers to make choices that
lead to contemporary, optimal print products
with maximum profit. In this context, not only
are continuous cost savings being realised, but
consideration is also being given to possible
cooperation or outsourcing in the field of
supporting services.
At the same time, investments are being made
in the quality of the content in print products.
These products must, of course, remain attractive
for critical consumers and develop in parallel with
readers’ changing requirements. At De Telegraaf
daily newspaper this was shown, among other
things, by the introduction of the Sunday
paper in March 2004, the setting up of regional
ANNUAL REPORT
sub-editing teams, and the introduction of
new columns in the newspaper. The turnover
from weekend subscriptions at De Telegraaf
increased. The regional daily newspapers of
HDC Media have switched from being evening
papers to being morning papers. The free local
papers have been vigorously reorganised and
the digitalisation of the production process has
enabled a refinement that makes some 500
local editions possible. At TTG, there have been
investments in new titles, such as CosmoGIRL!
and JAN. Piece by piece, these measures have
had a positive impact on circulation figures and
advertising revenues. Where economies of scale
cannot be realised, divestment is being considered, such as with the activities in Limburg.
In addition, there have also been investments
in activities that are parallel to print media or
capitalise on developments that threaten the
position of these media. An example of this is
www.speurders.nl, a website that responds to
the strong emergence of internet as competitor
for the small ads in daily newspapers. Speurders.nl is one of the leaders among the internet
marketplaces, which has won back a significant
percentage of the newspapers’ loss in market
share of classified adverts in the paper. As with
so many initiatives on internet, the ultimate
challenge is also to gain the associated financial
results from it.
Investing in other markets and different
types of media
TMG has always pursued a policy that was
sharply focused at reaching diverse target
groups with a combination of information and
entertainment. A model that has been successfully applied for many years. In recent years,
2005
13
however, the dynamics of media markets and
media consumption have changed drastically.
The competition has increased due to new entrants and new types of media, and the rate of
information transfer has considerably increased.
Moreover, there is a growing group of users
who want interactive information facilities.
This is also a market in which TMG wants to
actively participate and expand.
TMG is the largest provider in the Netherlands
on internet and in interactive media. Mobillion,
for example, is one of the leaders in this
field. The company started as a provider of
interactive teletext, but now operates interactive TV and internet. An example of this is
www.sugababes.nl, an internet community for
young people in which television programmes
are used to stimulate multimedia applications.
www.habbohotel.nl, with 53,000 unique users
per day, is also one of the most successful
interactive internet sites in the Netherlands.
The acquisition of a 70% interest in the dating
sites relatieplanet.nl and Iwannadate.nl as at
1 January 2006, and the formation of Telegraaf
Classified Media B.V. also fits in with this policy.
A new market segment for TMG is also the
market for narrowcasting; the development
and use of content on digital screens and
connecting these screens to back-office
systems (such as company networks and
inventory systems). TMG entered this market in
November 2005 by acquiring a 40% interest in
Media Librium, an operator of digital media.
Besides investing in internet and interactive
media, TMG also wants to reinforce its position
in radio and television. The problem with this
14
ANNUAL REPORT
2005
is that the cross-ownership rules in the Dutch
Media Act limit the growth opportunities for
publishers such as TMG in radio and television
on the Dutch media market. Partly because of
this the 27% interest in SBS Broadcasting B.V.
was converted into a 20% interest in its parent
company SBS Broadcasting S.à.r.l. at the end of
2005. This transaction offers TMG the opportunity to participate in the strong international
growth of SBS. With the partners in SBS, TMG
will look into the possibilities of cooperation
both in the Netherlands and abroad, in order
to fully utilise the potential of the strategic
partnership.
urgency is required in this debate, because the
dynamics on the media markets are accompanied by rapidly developing changes in market
conditions.
In February 2006, a consortium under the
leadership of Telegraaf Media Groep N.V. (TMG)
acquired Sky Radio Limited, with financial
support from the investment company ING
Corporate Investments Participaties B.V. (ING CI).
TMG has a minority interest in the consortium,
because the cross-ownership regulation in the
Dutch Media Act does not permit TMG to hold
an interest larger than 33 1/3% in a national
commercial broadcasting body. TMG has an
option to acquire the ING CI interest in the
consortium if TMG’s share in the total circulation of the Dutch daily newspapers falls to less
than 25%, or if the current media regulations
are relaxed.
With respect to the rules in the Media Act, it
seems there is increasing political willingness to
ease the existing regulations. After all, the current
Media Act no longer seems to be in tune with
the current market situation, and there is an
urgent need for new basic principles for policy.
The Advisory Council on Government Policy has
drawn up a report that foresees regulations that
leave more room for cross-ownership. Some
The Ukraine is a market in which knowledge of
print media products still provides abundant
opportunities for expansion, but at the same
time there is demand for new types of media
such as internet, interactive media and narrowcasting. The advertisement market is still growing
strongly there, and there is enormous need
for new media communication, whereas the
capacity of the existing providers is limited.
One of TMG’s first initiatives on this market was
the introduction of a free daily paper modelled
on Sp!ts. For lack of sufficient printing capacity,
the newspaper currently only appears three
times a week with a limited circulation.
Increasing internationalisation
Because the growth opportunities in the Dutch
media market are currently still limited by the
legislation, and because other markets offer
room for faster growth, TMG has entered new
geographical markets. Following the successful
entry on the Swedish market some years ago, a
periodical publisher in the Ukraine was acquired
in 2005.
ANNUAL REPORT
prospects
For Telegraaf Media Groep N.V., 2005 is a year
in which interpretation has been given to the
lower case g in our logo, the physical symbol
for acceleration. An accelerated interpretation
of growth in different types of media other than
print media. This is simply because consumers
have preceded us in that choice and we as a
media group do not want to be left behind.
Because our knowledge and passion are invested
in media exploitation. We want to become less
dependent on print media and claim a larger
part of media consumption in other types of
media. At the same time, we are adding new
values to existing media by use of the same
information in different forms (in print, on
internet, via the telephone), which is enabled
by digitalisation. Entering new growth markets,
where there is enormous demand for both new
and the more traditional media, offers new
opportunities for expansion.
Once again, we do not issue a profit forecast
for this year. In the first place, there is still not
enough insight into the developments in the
advertising market. For the first eight weeks
of this year we see a slight drop in advertising
turnover for the daily De Telegraaf and the
regional dailies. Income from single-copy sales
is also under pressure. Sp!ts, on the other hand,
is successful in maintaining its upward trend in
advertising turnover.
Secondly, a considerable number of changes
will be taking place in the activities portfolio in
2006. These include the proposed sale of Media
Groep Limburg, Nieuwsdruk Limburg and possibly Uitgeverij De Trompetter during the course
of the year and the purchase of a 33.33% interest
2005
15
in Sky Radio Limited as of 1 April next. There is
still uncertainty, in light of media legislation, as
to when TMG will be allowed to acquire 100%
of Sky Radio. On 31 December 2005 the 27%
interest in SBS Broadcasting B.V. was replaced by
a 20% interest in SBS S.à.r.l. The impact of these
changes on the result for 2006 cannot yet be
assessed.
Factors that are expected to impact the net
result for 2006 in a positive sense include the
expected book profit on the sale of the activities in Limburg, the results of the participations
acquired, the effects of reorganization measures
that have taken place, and the growth in turnover
from online activities. Negative factors are the
provisions for restructuring that will be required in
connection with further cost cutting measures,
plus an expected rise in the price of paper.
Overall economic developments and the consequences for media spending will be the prime
issues impacting this year’s results.
The cash flow for 2006 will get a positive impulse
from the proposed sale of the activities in
Limburg. The purchase of the interest in Sky
Radio will require approximately €20 million,
with the remaining cash coming from external
funding. The resulting cash facilities can be,
depending on the size and realisation of acquisitions and the development of the share value,
used for the repurchase of own shares.
Chairman of the Executive Board
Telegraaf Media Groep N.V.
A.J. Swartjes
Amsterdam, 15 March 2006
ANNUAL REPORT
2005
17
consolidated data
financial developments
results
The annual figures of both 2005 and 2004
have been prepared in accordance with the
currently applicable IFRS principles. In note
33, starting on page 95 of this annual report,
the annual figures for 2004 adjusted according
to the IFRS principles are compared to the
figures according to Dutch GAAP principles as
published last year, for information purposes.
The same section also explains the effect of
IFRS on the results separately.
A net profit of € 65.4 million was achieved in
2005, compared with a € 67.7 million net profit
for 2004. The operating result increased from
€ 26.3 million in 2004 to € 53.2 million in 2005.
The net turnover increased by € 42.4 million,
of which € 15 million was advertising turnover
that was mainly attributable to the acquisitions
of Bongers Beheer B.V., Bohil Media B.V. and
several magazine titles in the Ukraine. However,
there was hardly any organic growth in turnover.
Turnover from subscriptions and single-copy
sales declined by € 2.3 million. While it is true
that revenue from weekend-subscriptions to
the daily newspaper De Telegraaf increased,
income from the periodicals and the regional
daily papers declined.
Turnover from distribution activities for third parties grew by € 6.6 million due to the acquisition
of distribution orders from Aldipress and PCM.
The other revenues rose by € 23.1 million, as a
result of various new activities by Telegraaf Expomedia Events (TE2) and the consolidation of the
majority interest in Mobillion acquired in 2005.
The total operating costs rose on balance from
€ 670 million to € 686.3 million, which included,
on the one hand, the € 33.4 million costs of
the new activities and, on the other, one-off
benefits of € 27 million from the revised
pension and early retirement schemes.
Costs of raw and auxiliary materials increased
somewhat as an effect of the new activities,
including the acquisition of Bongers Beheer en
Bohil Media, as well as an effective 3.4% higher
paper price. Against this, there was lower
consumption compared to 2004 as a result
of the decline in volume.
Wages rose by around 2.5%. The number of
employees increased due to the acquisition of
new activities and there was an average pay rise
of some 2%. Much of this was compensated by
the reorganisation measures from previous years.
Social charges and pension costs declined on
balance by approximately € 27 million due to
one-off benefits. This is partly due to the new
pension arrangements with Stichting Telegraaf
Pensioenfonds 1959, which under IFRS meant
a transition from a defined benefit scheme to a
group defined contribution scheme. In addition,
cutbacks on early retirement rights and the
health insurance scheme for retired personnel
led to a cost reduction.
The depreciation of property, plant and equipment decreased by € 3.2 million, and the
amortisation of intangible assets increased by
€ 4.8 million, due to shifts within the IFRS
framework.
18
ANNUAL REPORT
2005
Other operating costs grew by over € 34 million.
The increase includes the € 23.3 million costs of
new activities in particular, higher promotional
expenses for new activities, and higher automation costs. Offsetting these was a more than
€ 4 million drop in printing expenses due to
revised print contracts for the periodicals and
TV Weekeinde.
The result from associated participating interests
rose on balance by € 2.6 million to € 9.8 million,
mainly due to a € 1.7 million higher result in
SBS Broadcasting B.V. The net financing activities
result increased by the balance of € 1.4 million
extra dividend received from Koninklijke
Wegener N.V. and € 0.1 million lower interest
income. The other financial income and expenses
concern the one-off proceeds from the sale of
the interest in SBS SA accrued in 2005, and the
sale of the 50% interest in the teletext activities
of Media Groep West B.V. In contrast, in 2004
there was a one-off book profit of € 13.2 million
from the sale of holdings in ANP Holding B.V.
and Brouwer Groep B.V.
Revaluation of financial fixed assets, in line with
IFRS requirements, includes the increase in
value over both 2005 and 2004 to fair value of
the holding in Wegener.
The cash flow from operational activities
increased from € 66.3 million in 2004 to
€ 73.6 million in 2005.
net turnover
Turnover increased by 6.1% from € 694.3
million in 2004 to € 736.7 million in 2005.
Important factors for this were higher advertising revenues (€ 15 million), distribution
revenues (€ 6.6 million) and other turnover
(€ 23.1 million), and a drop of € 2.3 million in
revenues from single-copy sales.
4.7% 4%
2.3%
TURNOVER
(€ 736.686 MILLION)
49.8%
Advertisements
Subscriptions + single-copy sales
Third-party printing
Distribution
Other turnover
39.2%
GOODS, SERVICES AND
VALUE ADDED
8.9% 2.7%
0.9%
56.7%
Goods and services
VALUE ADDED
Personnel costs
Depreciation + miscellaneous
Company tax
Net profit
30.8%
At De Telegraaf daily paper, advertising volume
declined by 3% compared to 2004, mainly in
the classified ads sector, whereas Sp!ts achieved
a 27% increase in volume. At the regional daily
papers, there was a rise in volume by 1%,
especially in the personnel category.
The free local (door-to-door) newspapers
increased in volume as a result of the
acquisition of Bongers Beheer. The periodicals
lost advertising revenue, partly because of the
ANNUAL REPORT
divestment of the titles MAN in the Netherlands
and Hemmet’s Bazaar in Sweden. In contrast
to this, the new title JAN was introduced in the
Netherlands.
In total, the group’s turnover in 2005 consisted
of € 366.6 million in advertising revenues
(49.8%) and € 288.6 million (39.2%) from
circulation income. The turnover from printing
orders for third parties amounted to € 16.7 million
(2.3%), the distribution income amounted to
€ 35.4 million (4,8%) and the miscellaneous
turnover amounted to € 29.3 million (4%).
This was € 351.6 million, € 291 million, € 15.8
million, € 28.8 million and € 7.2 million respectively in 2004, or 50.6%, 41.9%, 2.3%, 4.2% and
1%. Turnover can be broken down as follows:
2005
x € 1 million
19
Group turnover
(x € 1 million)
Average number
man-years
Average turnover
per employee
(x € 1,000)
2001*
822.2
5,425
152
2002*
704.5
4,690
150
2003*
683.6
4,459
153
2004
694.3
4,354
159
2005
736.7
4,317
171
*(Dutch GAAP)
added value
The group’s total added value and the average
added value per employee, have developed as
follows in the past five years:
2004
Added value
(x € 1 million)
Per employee
(x € 1,000)
2001*
372
69
(11%)
2002*
339
73
(8%)
2003*
333
75
(4%)
2004
387
89
(2%)
2005
396
91
(1%)
*(Dutch GAAP)
National newspapers
346.4
(47%)
330.9
(48%)
Regional newspapers
179.8
(24%)
180.6
(26%)
Free local papers
80.6
(11%)
72.9
Magazines
51.9
(7%)
53.7
Distribution activities
34.6
(5%)
28.6
Printing orders
16.7
(2%)
15.7
Other activities
26.7
(4%)
8.1
736.7 (100%)
2005
690.5 (100%)
The consolidated sales in 2005 include 0.8 million
(1.1%) achieved in the other EU countries,
compared to 0.2 million in 2004.
The turnover per employee (FTE) increased by
7% from € 159,463 in 2004 (on IFRS basis) to
€ 170,632 in 2005. During the past five years,
turnover, average number of man-years, and
turnover per employee, developed as follows:
shareholders’ equity
Including the result achieved over 2005,
shareholders’ equity increased from € 480.6
million at year-end 2004 to € 530.5 million at
year-end 2005. In the equity, no account has
yet been taken of the dividend to be paid over
2005.
20
ANNUAL REPORT
2005
This represents an increase from € 9.15 to
€ 10.10 per share. The number of shares is
unchanged and consists of 52,499,200 ordinary
shares and 960 priority shares of € 0.25 nominal
value. Of the ordinary shares, 32,910,938 were
converted into depositary receipts as at 31
December 2005, amounting to 62.7%,
compared with 62.1% at year-end 2004.
2004 62,1%.
the vehicle fleet (€ 5.7 million), as well as other
equipment and intangibles (office furniture and
equipment, and hardware and software
investments: € 24.6 million).
MOVEMENTS IN CAPITAL EXPENDITURE
OF TANGIBLE FIXED ASSETS IN RELATION
TO OPERATIONAL CASH FLOW
in millions of euros
ADVERTISING TURNOVER
in millions of euros
61
38
25
19
25
405
19
370
77
344
352
75
366
74
21
80
41
38
265
2002 -5
2001
Newspapers
2002
2003
2004
Door-to-door papers
2005
Magazines + others
Cijfers 2000 t/m 2003 zijn niet aangepast voor IFRS grondslagen.
investments
The total amount invested in 2005, in both
property, plant and equipment, and intangible
assets (excluding goodwill), amounts to € 44.2
million. This concerns investments in new
projects, including the advertising department
and the customer contact centre (€ 9.6 million),
replacement investments in company premises
and machinery (€ 4.3 million), investments in
Cash flow
35
38
2003
-30
2001
65
49
33
309
68
66
62
2004
2005
-26
Depreciation
Net profit
Capital expenditure
dividend
Dividend policy
The dividend is set within a bandwidth of 15%
to 30% of the cash flow, in which cash flow
is defined as the sum of the net profit and
depreciation and amortisation, adjusted for the
effects of revaluation and impairment included
in the net result.
The proposal is to fix the dividend for 2005 at
€ 0.44 per share. In doing so, € 23.1 million, or
more than 26% of the net profit, will be paid
out. Last year € 0.30 per share was paid out.
ANNUAL REPORT
group matters
human resource
management
For the HRM organisation, 2005 was characterized by the numerous amendments in
legislation and regulations with effect from
1 January 2006. In particular, the tax rules
in the area of early retirement, pre-pension,
pension and career-break savings, led to
laborious collective labour agreement (CAO)
consultations and the lack of agreements
concerning redundancy schemes for older
employees.
The continuing negative economic climate
made further cost reductions necessary. In
June of the financial year, a selective recruitment
freeze was announced. When filling job
vacancies, the emphasis lay on as much internal
promotion as possible.
A group-wide reorganisation was announced
at the end of the financial year, involving a
reduction of more than 200 full-time equivalents
(ftes). The various operating companies will
carry out these staff reductions during 2006.
Employment
In 2005, there was an average of 4,317 employees
in the group’s service, compared to 4,354 in
2004. The reduction of the number of ftes can
be explained by staff reductions part of large-scale
reorganisations at the operating companies HDC
Media, Holland Combinatie, Media Groep
Limburg and DistriQ. This against an increased
number of ftes as a specific result of acquiring
for 100% new activities, such as Bohil, Mobillion
and Bongers.
2005
21
Terms and conditions of employment
Five CAOs were agreed during the financial
year, but no agreement has been reached yet
for the road transfer and haulage CAO. The
final Grafimedia CAO was agreed in October
2005, with a pay rise of 1% on 1 June 2005 and
another 1.5% on 1 June 2006.
A new CAO for newspaper journalists was agreed
for the period of 2005 to 2006, an important
component of this being a new job demarcation
instrument with a corresponding new wage
structure. Moreover, the agreement contains an
amended early retirement/pre-pension scheme.
The newspaper journalists’ CAO contains a
collective pay rise of 1% on 1 July 2005 and
another 1.5% on 1 January 2006.
Health policy
In 2005, a group-wide health management
process was started. To achieve this, on the one
hand, the health policy has been optimised
across the group. On the other, preventive
attention is actively paid to the health of the
employees. Besides preventive activities, there
is tighter management aimed at decreasing the
rate of absenteeism.
environment
The environmental policy of Telegraaf Media
Groep is characterised by compliance with the
regulations and by taking personal responsibility
in this area. An additional point of attention
is the environmental awareness of employees.
The activities during the past year have been
particularly focused on an integrated group-wide
approach and on the reduction of waste.
New cleaning techniques in printing lead to
22
ANNUAL REPORT
2005
a reduction in the use of chemicals, which
could harm the environment. In 2006, an
energy-saving investigation will be commenced.
health and safety at work (arbo)
An ongoing point of attention continues to be
enforcing and further optimising good working
conditions to promote the productivity of the
employees. During the past year, a scan has
been carried out on the completeness and
quality of the health and safety policy at the
operating companies. In accordance with the
Dutch Health and Safety at Work Act, preventionstaff members have been appointed and trained
at the operating companies. They will ensure
up-to-date and complete implementation of
the policy in the future.
corporate purchasing
During 2005, a plan has been developed for a
group-wide purchasing improvement project.
This plan provides economies of scale, while
the specific individual needs of the operating
companies remain guaranteed. The centralised
purchasing of personnel, services and resources
will increasingly lead to savings on immediate
and indirect purchasing costs.
central works council (cor)
During the past three years, the Central Works
Council (COR) has developed itself into a
professional employee participation body.
In 2005, there was a follow-up to the revised
operating procedure, which was introduced in
2004. The members have all attended a course,
in which strengths and areas for improvement
have been identified, which the COR wants
to continue developing in 2006. The group is
continually developing and changing, which
demands a lot of effort and professionalism from
the COR. The consultations with the Executive
Board were held in a stimulating atmosphere.
The main issues involving the COR in 2005
were: acquisition of Bongers Beheer, job
performance and appraisal system of non-CAO
positions, 2004 COR annual report, introduction
of a whistle-blower scheme, the participating
interest in Expomedia, the participating interest
in Media Librium (M-Media), and the interest
in SBS Broadcasting S.à.r.l. All advisory and
approval requests to the COR were not only
checked against the corporate strategy, but also
against its own mission.
ANNUAL REPORT
specific risks associated
with the company
The Executive Board of Telegraaf Media Group
is accountable for the internal risk management
and control systems, and, insofar this is possible,
for the active management of strategic, financial
and operational risks that confront TMG. In this
context, the following risks have been identified,
which, if they arise and are not sufficiently
controlled, could have a substantial impact on
the realisation of the operational goals.
•
TMG operates in an industry that is sensitive
to economic cycles.
•
TMG is one of the largest media players in
the market for media consumption in the
Netherlands, with a strong position in print
media, in which the share in printed media has
visibly decreased.
•
TMG is still strongly dependent of one
product, the daily newspaper De Telegraaf.
•
Because of the restricted growth opportunities
in the Netherlands, TMG has currently entered
new geographical markets, which can equally
constitute a risk.
•
TMG is experiencing increased competition
from new entrants and new types of media, and
the increased rate of information transfer in the
media consumption market.
•
The cross-ownership rules in the Dutch
Media Act limit TMG in its growth opportunities
in radio and television in the Netherlands.
2005
23
•
Large parts of the business processes of TMG
rely ever increasingly on computerised systems
and networks. Malfunctions on these can cause
a large disruption to the business processes.
• Another risk is the fluctuation in the level of
the price for paper, particularly of rotation-offset
paper for the printing of newspapers. TMG
concludes annual contracts with the paper
suppliers. There is a risk of not or not entirely
being able to pass on paper price rises.
Although adequate and effective risk management
and control systems are applicable, these,
however, can never provide an absolute
guarantee for the realisation of the corporate
objectives, nor can they completely prevent
substantial errors, losses, fraud or the violation
of legislation and regulations. (see page 46).
ANNUAL REPORT
2005
25
publishing activities
market developments for
newspapers
showed an increase of 6%.
National dailies, excluding the Sunday papers,
performed better than regional dailies in the
area of advertising volume. The advertising
volume in the national papers fell by 4%, while
the fall for the regional dailies was 11%.
The total distributed circulation of Dutch
newspapers decreased during the period
from 1 October 2004 up to and including 30
September 2005 by 3.7% down to 3,912,382
copies. The fall in circulation of the national
daily papers amounted to 3.2%, and that of
the regional dailies was 4.1%.
Note: All the reported advertising volumes have come
from Nielsen Media Research. The free daily papers
Sp!ts and Metro have been disregarded in all figures.
The domestic distribution of newspapers consisted of 90.2% from subscriptions and 8% from
single copy sales. Foreign sales amounted to an
average of 40,452 copies a day. The other forms
of distribution (special subscriptions, Telegraaf-i)
amounted to 1.8% of the circulation.
The breakdown of the distributed circulation
into circulation components provides the
following picture for the total Dutch market:
National
Subscriptions
Single-copy sales
Abroad
Total
%
3,514,989
13,255
284,867
27,073
3,528,244 90.2
311,940
8.0
72,074
124
72,198
1.8
3,871,930
40,452
3,912,382
100
Other
distribution
Total distributed
circulation
The advertising volume in all Dutch daily newspapers, excluding the Sunday papers, decreased
by a total of 9% in 2005. The categories of
national and local brands and services decreased
by 10%. The classified advertisements decreased
by 21% and the family notices by 6%. On the
other hand, the personnel advertisements
national daily newspapers
uitgeversmaatschappij
de telegraaf b.v.
(de telegraaf publishing company)
The still ongoing bad economic cycle retained
its negative impact on the revenues of De
Telegraaf publishing company. Its main victim
was the advertising sales, but this situation
also had a negative side effect on the readers’
market. Cost-saving measures only partially
offset the disappointing turnover. Incidental
savings have already been achieved during
the financial year, and preparations were made
that will lead to structural cost reductions.
The quality of products and service will
remain unchanged despite this.
Circulation
The distributed circulation of daily newspaper
De Telegraaf in the Netherlands during the
period from the fourth quarter of 2004 to the
end of the third quarter of 2005 fell by 2.7%
compared to the same period of the previous
26
ANNUAL REPORT
2005
year. The circulation amounted to 732,073 copies
because of this. This percentage is some 1% less
than the average fall in circulation for all daily
newspapers in 2005. The market share of De
Telegraaf newspaper in the market’s circulation,
excluding the Sunday edition, rose slightly to
18.7% as a result of this.
During the financial year, substantially more
subscriptions were acquired than the previous
year. However, partly because of the economic
situation, which obliges consumers to make
spending cuts, the number of cancellations
was also higher. On balance, the number of
subscriptions in the Netherlands decreased
from 598,189 copies to 589,810 copies, a fall
of 1.4%.
The number of weekend subscriptions
(a combination of Saturday and Sunday papers)
increased steadily and grew from 26,559 in
2004 to an average of 48,084 in 2005. This is an
increase of 81%. By the end of 2005 the status
was 63,500 copies.
The average single copy sales in the Netherlands
from Monday to Saturday decreased from
116,357 copies in 2004, to 97,181 copies in 2005,
a fall of 16.5%.
The Sunday paper appeared to really meet a
consumer need in 2005 and gained an average
circulation of 688,353 over the period from
quarter four of 2004 to the end of quarter three
of 2005.
The single copy sales abroad remained at a
good level. Partly thanks to the efforts of the
five foreign printers during the summer period
(in the Canary islands, Valencia, Marseille,
Istanbul and Verona), with an increase in those
countries where tourism also grew. In the
countries that had to contend with a decline in
numbers of tourist visits, De Telegraaf was able to
reinforce its market share. The foreign circulation
averaged 26,755 copies over the financial year,
an increase of 3.8% compared to last year.
In September 2005, a special Caribbean edition
was introduced on Curacao, Aruba, Bonaire,
Saint Martin, Saba and Saint Eustace. On Curacao,
besides single copy sales, the newspaper is also
available on subscription.
Editorial
A number of revitalizations were carried out in
the newspaper during the course of 2005. The
‘What You Say’ feature, which promotes the
interaction with the readers, was expanded
with a strong link to internet. The Telesport
section was enlarged, and there was an
expansion of the ‘Lifestyle’ segment by adding
features such as ‘Eating and Enjoying’, ‘Health’
and ‘Healthy and Fit’.
The editorial staff of the Greater Amsterdam
edition was reinforced and The Hague edition
had a regional page added, similar to the
existing page for Rotterdam. In Twente, the
addition in 2005 of the ‘Twente Today’ regional
section to De Telegraaf daily newspaper also
ensured a better circulation position in this
region compared to the national average.
Advertisements
The total advertising volume in De Telegraaf
was subject to pressure and decreased
by 4%.
ANNUAL REPORT
The advertising volume, excluding the Sunday
paper, decreased in 2005 by 3%. The national
brands and services category increased by
5%. The personnel advertisements soared
by 28%. On the other hand, the classified
ads category plummeted by 21%, a trend that
has been continuing for years due to the
fierce competition. The family notices category
declined by 2%.
The total advertising volume in the Sunday
paper decreased in 2005 by 16% compared to
2004. In contrast to the readers’ market, the
familiarisation with the Sunday paper as advertising medium is taking longer than expected.
The advertising turnover of the Sunday paper
is not yet fully comparable on an annual basis,
because this edition was introduced on 21
March 2004. Additionally, the comparability is
distorted by the unrepresentative high level of
advertising during the introduction period.
Internet
The most important internet activities
experienced substantial growth in the areas
of both number of unique visitors and in page
views. The advertising revenues increased
strongly.
The average number of page views across the
entire Telegraaf network including the classified
sites speurders.nl, autotelegraaf.nl (cars) and
vacaturekrant.nl (situations vacant) more than
doubled to 8.9 million per day compared to
December 2004.
Measured across the entire Telegraaf network,
online advertisement revenue rose by 49%
to an amount of 13.1 million euros.
2005
27
The telegraaf.nl news portal saw its daily visits
increase during the financial year to an average
of more than two million page views per day,
25% more compared to December 2004.
In 2005, besides the restyling of a number of
sites, new sites were added, such as Fitclub,
Glamour, Crime, Eating and Enjoying, Televideo,
Newzy, Telepuzzel, GameToday and What
You Say.
Moreover, the interaction of the sites with the
consumer was extensively expanded. With many
topics, the consumers can make their opinions
known on-line, which provides a picture of the
broad opinion on each topic.
Classified
Because the Noordelijke Dagblad Combinatie
B.V. has a 10% interest in both speurders.nl and
vacaturekrant.nl, a new B.V. (private limited
company) was set up within De Telegraaf
publishing company: Classified Media B.V., into
which all classified advertising activities within
the publisher have been bundled.
Speurders.nl
This digital marketplace for second-hand goods
experienced a major expansion throughout the
financial year. The number of page views grew
from a 2 million average per day in December
2004 to an average of 5.8 million page views per
day in December 2005. The number of advertisements in the database grew from 750,000 at the
end of December 2004 to 1,300,000 by the end
of December 2005. Speurders.nl has meanwhile
become one of the best visited Dutch sites.
28
ANNUAL REPORT
2005
Acquisitions
basismedia b.v.
Bohil Media B.V.
De Telegraaf publishing company acquired the
remaining 80% of Bohil Media B.V. in 2005. In
2003, a 20% participating interest had already
been taken in this company, a publisher of
classified magazines about boats and caravans
& campers, with important internet sites linked
to these magazines for both used and new
boats, caravans, and campers. The results of this
publisher were even better in the 2005 financial
year than in 2004.
From an increase in turnover, on one hand, and
optimising of costs on the other, the result of
BasisMedia has increased exceptionally.
The objective in 2005, that BasisMedia
would provide an important contribution to
the consolidated results, has been realised.
Against the market trend, the total turnover
increased by 24.6% in 2005.
Relatieplanet.nl Nederland B.V. including
iWannadate Nederland B.V.
In the last month of 2005, 70% was acquired in
this market leader in on-line dating. The activities
have been placed under Classified Media BV.
Forecast
On 1 October 2005, an average price increase of
2.7% was implemented on the readers’ market.
As a result of the fall in circulation, as at
1 January 2006 no appreciable increase in rates
has been realised on the advertisement market.
It remains to be seen how the market situation
is going to develop in 2006. Naturally, everything very much depends on the economy
and consumers’ media behaviour. During the
financial year, preparations were made for
structural and also substantial savings to be
introduced in the overhead costs of the production and staff components in particular during
the first half of 2006.
Circulation
The average circulation of the free daily newspaper Sp!ts in 2005 is 382,000 compared to
358,000 in 2004: a 6.7% increase. The current
daily circulation is 430,000 copies, without
taking holiday periods into account.
Advertisements
Sp!ts was the only one of the national and free
daily newspapers to see a strong increase of
the total media spending in 2005 compared to
2004. The market share of Sp!ts has increased
from 6.5% in 2004, to 8.5% in 2005. The advertising volume rose by 24% in 2005.
On the advertisement market, the customers
increasingly expect a tailor-made multimedial
media package. A shift is taking place from
product thinking to concept thinking. It is also
essential to launch new joint ventures with
other parties or other media.
2005 approach
During the past year, Sp!ts has made the strategic
decision to position its brand more clearly and
even more distinctively as the medium in reaching
the new generation: teenagers and young adults
in the age category from 18 to 34, within which
ANNUAL REPORT
2005
29
there are many students, business starters
and young professionals. During the coming
years, print, online, mobile, events, radio and
television will be extended within several pillars
of content.
from personnel advertisements was considerably improved, the advertising revenues from
national and regional advertisers lagged behind,
however. On balance the adverting revenues in
2005 were 1% down on the preceding year.
regional daily newspapers
In the context of product developments in
2005, for the first time HDC Media organised a
number of regional trade fairs that provided
additional revenue flows. By linking print
products to these trade fairs, new advertising
revenue was also generated.
In 2005, both circulation and advertising
revenues came under pressure again at the
regional daily newspapers. Thanks to various
actions in the area of acquiring subscriptions
and conversion of titles, HDC Media’s result
was better than average in comparison to other
regional dailies. Media Groep Limburg B.V.
(MGL), like the other regional papers, showed
a decrease in the advertisement revenues.
hdc media b.v.
In some parts on the edge of the distribution area, the coverage of HDC Media left
something to be desired. Therefore, a new
experimental publishing concept was started
in Alphen aan de Rijn: alphen.cc. Three times
a week for the time being, a newspaper that is
free during the introduction period is distributed
as an editorial format of a regional daily and
with multimedial possibilities. The first results
are encouraging.
Circulation and advertising
In comparison to other regional dailies, and
certainly also against the national daily press,
the developments at HDC Media were relatively
favourable. The circulations decreased less than
2%, which is partly attributable to the switch in
2004 to morning papers for titles that then still
appeared as afternoon papers (in 2005 there
were more than 40% fewer cancellations in this
area). Revised policy concerning acquiring and
particularly retaining subscribers also led to
successes in this area.
With the move into the vast and largely renovated head office in Alkmaar, an important
step forward was taken in the reorganisation
of HDC Media, which commenced in 2002.
The central editorial staff as well as a large
number of supporting departments have
now been combined here.
The total advertising volume compared to last
year remained virtually the same. The revenue
The majority of the reorganisations were rounded off in 2005. In a relatively short time,
The total turnover of HDC Media remained
virtually unchanged. The cost reduction as
result of the reorganisations resulted in more
than 6% lower indirect costs.
ANNUAL REPORT
the workforce has been reduced by 30%.
Nevertheless, the coming years will continue to
be characterised by improvement of the market
share in the readers’ and advertisers’ markets,
further cost reduction, and still more efficient
arrangement of the various working processes,
including the use of outsourcing.
media groep limburg b.v. (mgl)
In 2005, the revenues were under pressure,
both on the advertising side (-9%) and the
circulation (subscriptions). Nevertheless, the
financial result improved compared to 2005.
The result improvement is thanks to the
strategic course for MGL that was chosen and
implemented three years ago, with the main
focus on structural cost reductions. In this way,
the operating result has been improved and the
vulnerability of the company reduced at a time
of pressure on circulation and the advertising
market.
In 2005, the Netherlands Competition Authority
(NMa) removed the restrictive conditions for
the publishers De Limburger and Uitgeversmaatschappij Limburgs Dagblad BV. This means
that further cost efficiencies are possible
through collaboration.
In 2006, the focus will again be on reduction of
the production costs on existing operations,
because revenues associated with these
activities from subscriptions and advertisers will
continue to decrease. This does not prevent
MGL having to achieve a good balance between
revenues and production costs, to guarantee
2005
31
the continuity of the publisher. TMG announced
in 2005 that it was considering selling MGL,
since, in the longer term, MGL needs both
synergy in the back-office and a level of scale
that cannot be realised within TMG. What
determines this development is not the current
quality of paid newspapers, but rather more the
behaviour of consumers who increasingly
obtain up-to-date information by means of
cheap, cheaper, or free alternatives, such as
radio, TV, internet, mobile telephony,
teletext, etc.
free local papers
The advertising volume of HC’s free local
papers was under pressure and there were
higher costs. Publishing company De
Trompetter has realised an increase in
advertising volume opposite to the market
trends. The integration of the publisher
Bongers, acquired in 2005, was completed
successfully. Both organisations expect to
realise synergy benefits from efficiency and
increase in scale in 2006.
holland combinatie b.v. (hc)
General
The year 2005 was a transitional year. The four
different legal organisations have merged into
a single publisher for which all group tasks are
performed in Amsterdam. The editorial staff
and local sales will remain in the branch offices,
a new structure and working methods must
make contributions to a more efficient
32
ANNUAL REPORT
2005
and more effective organisation. The objectives
of the restructuring will only be completely
realised during 2006.
The organisation has undergone a major change
in structure, locations, jobs, working method
and automation. The name has also been
changed of Hollandse Huis-aan-huisbladen
Combinatie B.V. to Holland Combinatie B.V.
The annual result of the Holland Combinatie was
considerably lower in 2005 than the aggregate
result of the group from last year. This was
caused by the lagging behind of the advertising
revenues at the regular weekly and weekend
papers, the printing costs, staff and ICT expenses,
provisions, and lower interest income.
In 2005, the advertising revenue was 4% lower
compared to 2004. The turnover was generally
under pressure due to disappointing volumes
(-6% compared to 2004), rates under pressure,
and competition. In particular, the weekend
editions suffered a loss in turnover. There were
large differences per region. Wherever possible,
solutions have been found in revenue-boosting
and cost-saving measures.
The title ’De Echo’ (11 editions) has been
entirely renewed and now appears in tabloid
format. The Amsterdam market, however, is
experiencing a downward trend and is dragging several neighbouring midweek titles with
it, because the onward placements decrease.
At the ’Woonbode’ in ‘t Gooi (a property
weekly, for the area around Hilversum), the
price is under some pressure and the number of
advertisements lagged seriously behind. New
agreements have been made with the estate
agents this year, as a result of which they are
more committed to this title. In Almere, the
turnover is also lagging behind.
Half of the operating costs of the Holland
Combinatie consist of direct intercompany
production costs for the newspapers. Because
of the smaller scale, there was less efficient
allocation of the production capacity, as a result
of which the direct production costs increase
and the added value decreases.
Personnel costs are an important expense
item for the Holland Combinatie. In order to
improve the result and prevent redundancy as
much as possible, restraint has been observed
in filling staff vacancies. Reorganisation resulted
in more than 23 employees being declared
redundant. This enabled savings on the payroll
costs and the number of employees has
decreased. The reorganisation and the redundancy measures will be completed in 2006.
uitgeversmaatschappij
de trompetter b.v.
(de trompetter publishing company)
In a difficult advertisement market, the turnover
of De Trompetter has increased by organic
growth and acquisitions. The number of advertising pages increased during the financial year.
The operating result improved considerably due
to the increase of the turnover and tight cost
control.
Uitgeversmaatschappij De Trompetter B.V.
acquired Bongers Beheer B.V. in Kelpen-Oler as
at 1 January 2005. Bongers Beheer B.V. is a holding company with three operating companies:
ANNUAL REPORT
2005
33
Bongers Media Productie, Bongers Drukkerij
and Bongers Productie.
Bongers is the publisher of free special-interest
papers distributed in Limburg.
magazines
De Trompetter also acquired the free local
paper ‘De Schakel’ in Stein, with a circulation
of 12,000 copies. In the Brabant municipality of
Haaren and Udenhout, Kempen Pers started up
the free local paper ‘De Leije’ with a circulation
of 9,000 copies.
TTG the Netherlands
The result of De Telegraaf Tijdschriften Group
(TTG) in 2005 is lower than for 2004. This was
caused by decreasing revenues on both the
advertisement market and the readers’ market.
Moreover, there was heavy investment in the
portfolio (new title ’JAN’ plus the restyling of
‘Elegance’) and in the organisation (restructuring
the Sales department). Concluding new printing
and pre-printing contracts led to considerable
savings in the production costs.
The strong increase of the turnover at Kempen
Pers is almost entirely attributable to organic
growth through higher revenue from advertisements. The increase in turnover was realised
with the same advertising volume, as a result
of which the operating result increased
substantially.
Bongers realised an operating result that,
despite higher depreciation charges due to the
transition to the new owner, is nearly equal
to its operating result for 2004.
The turnover increased strongly, partly due to
expansion in 2004 with the special-interest papers
’Autoinformatief’ and ’Werken’. The number
of advertising pages has strongly increased due
to this expansion in the number of publications.
The income from external printing orders in
2005 was also much higher than in the 2004
calendar year.
The year 2006 will be marked by further optimisation. The synergy benefits from the acquisition
of Bongers Beheer must become clearly visible
in the new calendar year.
de telegraaf tijdschriften
groep b.v. (ttg)
There was still no recovery visible on the
advertisement market in 2005. At the same
time, the number of periodical titles grew
considerably. The price level was under further
pressure as a result of an aggressive pricing
policy within the total sector. The competition
from other types of media, including television,
was also very noticeable.
The circulation market has been characterised
for a number of years already by further segmentation and new title introductions, with resulting
pressure on the number of copies sold. Moreover,
consumers are still cautious in their spending.
Compared to 2004 (HOI 3rd quarter) the sales
figures of ’CosmoGIRL!’ were 26% higher, with
an average of 95,020 copies. With the exception
of ’Elegance’, the circulations of the other titles
were under pressure. TTG’s largest title, ’Privé’,
decreased by 4%, but was still able to increase
its market share in the gossip segment.
34
ANNUAL REPORT
2005
The ’Idols Magazine’ was published in cooperation with RTL Nederland. Although TTG
strives mainly for further growth, it continues to
critically examine the profitability of its existing portfolio. The results and the prospects for
the titles ’MAN’ and ’Modern Country’ were
negative, so it was decided to stop publishing
both titles.
The Habbo Hotel (virtual meeting place for
young people), introduced in 2004, developed
further into a success in 2005. At present, the
website has approximately 53,000 unique
visitors per day.
TTG expects a slightly cyclic recovery on the
advertisement market in 2006. Moreover, the
marketing will improve as result of the internal
restructuring. TTG does not expect any recovery
on the readers’ market yet. Although consumer
confidence is increasing, TTG does not expect
any increase in spending for the time being.
TTG Sweden
The Swedish economy developed successfully
and at TTG Sweden the turnover and result
improved. The special interest and interior
design periodicals show a strong increase in
advertisement revenues. In the boat segment,
the revenue from advertisements continued
growing by 17%.
The single copy sales in Sweden stood under
pressure from the increase in new titles and
one-off publications, with unchanged consumer
spending. Despite this, the sales of ’Cosmopolitan’
continued growing in 2005, and the magazine is
now the best-selling title for young women.
The publication frequency of ’Residence’ in
2005 was increased to 8 numbers a year.
The circulation is stable, advertisement income
has increased and the result has improved.
’Golf Digest’ showed a particularly positive
development on the subscription market.
In 2005, the focus was on brand and line
extensions, and during the year various one-off
publications and events were organised around
the titles.
TTG Sweden has also entered the market of
sponsored magazines with the start of a joint
venture with SAS Media. A magazine is being
jointly published for the members of the SAS
Frequent Flyer programme.
The marketing and sales departments have
been merged and an efficient digital work flow
has been organised within the company. All
pre-printing activities are performed in-house.
The prospects appear favourable for the Swedish
market in 2006. The most important priority
remains a continuing expansion of the portfolio,
through organic growth and/or acquisitions.
telegraaf media international b.v.
Telegraaf Media Ukraïne LLC (TMU)
In 2005, TMG started publishing activities in the
Ukraine, commencing with periodicals. A local
publisher was acquired, which publishes five
existing and profitable titles in the segments
interior/design (Domus Design), do-it-yourself
(Maister), free time (What’s On), eating out
(Gourmet Guide) and the in-flight magazine of
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Ukrainian Airlines (Panorama). In October 2005,
Kiev City was added to these. Except for What’s
On (in English), all the periodicals are published
in Russian.
Because of the poor quality of the distribution network, the Ukrainian market is still
mainly aimed at advertising revenues. A part
of the distribution of the majority of periodicals is free therefore, in order to nevertheless
be able to guarantee advertisers penetration.
The advertising spending shows very positive
developments year after year. The increase in
2005 is valued at 30% and the same increase is
expected for 2006. Due to the low rates of the
mainly state-managed TV stations, however, the
share of periodicals is much lower than in other
European countries. With the move towards
a more market-oriented economy, a positive
development for the periodicals market can be
expected, both for growth of the total advertising spending and a shift from TV to print.
At the same time, with the strong increase in
advertising spending, the number of periodical titles grows. However, there are currently
many segments not yet covered, with local
periodicals of very poor quality, and the competition within segments being limited. Further
professionalisation of the existing titles in the
portfolio is on the agenda for 2006, as well as
launching new titles.
Much attention will also be paid to the professionalisation of distribution, market research
and printers. These activities are mostly set
up from within an umbrella organisation for
publishers in the Ukraine, in which TMU
actively participates.
2005
35
On 1 January, a start was made with a free
newspaper ’Obzor’, which appears three times
a week. ’Obzor’ aims at a younger and wealthier
target group (18 to 35) than regular newspapers
in the Ukraine. ’Obzor’ offers an alternative with
a colourful exterior, free distribution during
the rush hour, and objective reporting. ’Obzor’
guarantees advertisers high penetration due to
the free distribution.
ANNUAL REPORT
2005
37
other activities
datawire b.v.
A number of multimedial activities of TMG
have been placed under DataWire. DataWire
has developed a digital distribution platform,
with which the contents of printed media
can be utilised via internet. DataWire aims at
syndication, including: the processing, distributing
and selling of existing content originating from
editorial departments and other sources.
PayperNews B.V.
PayperNews expects further growth of turnover
by increasing its market share in the Netherlands and abroad, and further exploitation of
the DIGI products. To be able to achieve this,
the organisation will be further “scaled up”, in
which extra attention will be paid to the sales
organisation and the order procedure.
DataWireSport B.V.
DataWireSport B.V., a joint venture of DataWire
( 70%) and ANP (30%), is a supplier of sports
results and other sporting information. In 2005,
DataWireSport concluded a cooperation agreement for seven years with KNVB, the Dutch
Football Association, for a common utilisation
of the KNVB website.
mobillion b.v.
Via TMG’s 100% interest in Media Groep West
B.V., Mobillion B.V. became a wholly-owned
subsidiary of Telegraaf Media Group during the
course of 2005. Whereas Mobillion, due to
the management buyout as at 30 December,
was set up initially as an enterprise which
specialised in the production and use of new
communication and entertainment services for
users of mobile telecommunications networks,
during recent years the business has developed
into a much more broadly-oriented online
entertainment company.
In the Netherlands, Mobillion has for some years
already been one of the largest providers of SMS
(text) chat services as well as ringtones that are
downloaded to mobile telephones, especially by
young people. Apart from in-house developed
consumer services, Mobillion also provides SMS
gateway services (business to business) to a large
number of SMS service providers.
The turnover of Mobillion has strongly increased
this year, among other things because of the
successful market launch of a self-developed
mass calling voice response platform, which
is mainly used for the various call-in-and-win
game programmes that are broadcast via the
television stations of SBS Broadcasting.
Mobillion has this year acquired a 70% interest
in Sugababes.nl B.V., publisher of the websites
www.sugababes.nl and www.superdudes.nl
that are extremely popular with young people
in the age bracket of 13 to 19 years old. Both
so-called profile sites are visited by some 100,000
young people daily, and are operated profitably.
During coming years, the management of
Media Group West will be concentrating on
establishing a new online communications
and entertainment group of which Mobillion
B.V., Sugababes.nl B.V. and the new WEB TV
production company Bibop TV will become
full subsidiaries.
38
ANNUAL REPORT
2005
facilities services companies
The activities in the areas of information and
communication technology, printing and
distribution have been placed in separate
subsidiary operating companies each having
its own result responsibility. This structure
promotes the optimisation of processes
and technologies, and improves the transparency of the cost structure within
the entire organisation.
telegraaf media ict b.v. (tmi)
Telegraaf Media ICT had a successful year in
2005. Although the original budget was not
achieved in all areas, an important step has
again been made in far-reaching cost reductions
and improved services.
Compared to 2004, ICT costs decreased by 6%,
whereas the efficiency improved by more
than 12%. This efficiency results from: the farreaching arrangement of central ICT procurement,
centralising the ICT infrastructure, standardising
applications, better coverage of effort due to
accurate time recording, and structurally reducing
the personnel expenses.
Because the internal charging-on has been fully
implemented, all customers have insight into
their actual ICT costs and these can be better
managed by the customer.
TMI played an important part in a number of
large internal ICT projects during 2005.
The year 2006 will be a dynamic one for TMI,
because of the focus on more drastic cost
reduction and improved quality within TMG.
Objectives for 2006 are: market conformity in
the area of costs, investigation into possibilities
for outsourcing, the portfolio and quality of the
services, increasing internal promotion, increasing
the customer’s options and improving measurability and manageability.
telegraaf drukkerij groep b.v.
(tdg = telegraaf printing group)
The newspaper printers in Alkmaar, Amsterdam
and Heerlen have focused on cost reduction
because of decreasing circulation and diminishing
advertising revenues at the publishers. This has
led to investigation and proposals concerning
capacity utilisation, optimum production methods
and as much as possible market-level rates.
Moreover, the Telegraaf Printing Group have
continued with the external marketing of
residual capacity. An inventory has been made
of the wishes and requirements of the clients,
and the corresponding utilisation and cost
structure will be rolled out in 2006. Grafisch
Bedrijf Media Groep Limburg will be included
as part of the sale of MGL.
The joint procurement of consumer non-durables
at the various printers is in its completion stage.
distriq b.v.
DistriQ is a distribution organisation for print
media that operates nationally, which uses a
tightly-knit network of about 35,000 transporters, depot holders and deliverers. DistriQ
distributes, among other things, the daily
newspapers of TMG and Het Financieele
ANNUAL REPORT
Dagblad (the financial daily). In addition, it
manages the transport for PcM (newspaper
publisher), and the distribution of periodicals
for Aldipress, several free local newspapers,
advertising folders, and post.
Compared to 2004, DistriQ has succeeded in
maintaining or improving the quality of the
distribution in almost all product-market combinations. Tighter legislation and regulations
and in particular, control of this by the health
and safety inspectorate, among other things,
have led to an increase of the complexity and
an increase of the distribution costs. Moreover,
initiatives have been developed by several
publishers that have a major influence on the
distribution efforts. For example, this includes
line extensions, supplements, additional doorto-door distribution and new publications.
In the North-Holland region, the previously
separate distribution of daily papers has been
integrated successfully, which has led to tangible
synergy benefits. For further optimisation of
processes and organisation, a start has been
made with replacement of the existing delivery
and transport systems.
The total turnover has increased compared to
last year, particularly from effects of full-year
orders that were rolled out during the course
of 2004 (distribution of the Sunday paper for
De Telegraaf, periodical distribution for Aldipress
and transport for PcM). The revenue from
retailers’ folders was somewhat lower.
In 2006, DistriQ will continue with optimising
the logistics processes, including the implementation of new ICT systems, as well as projects for
2005
39
joint delivery of daily papers in South Holland
and ’t Gooi area around Hilversum.
DistriQ expects a lower result for 2006, because
the rates will be under pressure from seeking to
achieve more market conformity.
40
ANNUAL REPORT
2005
participating interests
telegraaf expomedia events vof (te2)
Telegraaf Expomedia Events VOF is a joint
venture of Telegraaf Media Groep N.V. and the
British Expomedia Group Plc. The joint venture
has the goal of operating special-interest trade
fairs and events.
The 2005 financial year was an investment year
for TE2. Besides continuation of existing titles,
such as ’Eten & Genieten’ (Eating and Enjoying),
’POP’ and ’Crime in Retail’, in 2005, the portfolio
of professional and consumer trade fairs was
strongly expanded in the segments of fashion
(’Modefabriek’, ’Kleine Fabriek’) and automotive
(’Race & Rally’), and participating interests in
titles such as Fleurig. Moreover, new concepts
such as New Technology Events and Fashion
Items were introduced.
The EXPO XXI congress and event facilities
were also opened in 2005. Besides a number of
events for TE2, EXPO XXI has meanwhile also
already hosted a number of successful events
for third parties. In 2006, TE2 will further extend
the position it has built up.
expomedia group plc
Following the existing Telegraaf Expomedia
Events VOF joint venture, TMG accrued a 20%
interest in joint venture partner Expomedia
Group Plc in 2005. This company has the
objective of setting up and operating an
international chain of state-of-the-art exhibition, event and conference centres. These
centres will then be used by Expomedia to
stage both its own events and those of third
parties. Meanwhile, existing locations include
places such as Cologne, Moscow, Belgrade,
Warsaw, Budapest and New Delhi. The rationale
behind this transaction is reinforcing the
cooperation already existing in the Netherlands,
being able to grow in parallel with the trade fair
medium type, and to access new, attractive
growth markets.
sbs broadcasting b.v./
sbs broadcasting s.à.r.l.
TMG’s share in SBS Broadcasting B.V. amounted
to 27% up to and including 20 December 2005.
On 21 December 2005, TMG exchanged its
shareholding of 27% in SBS Nederland, plus a
non-recurring cash injection of approximately
€ 18 million, for a 21.39% interest (diluted to
20% early 2006) in SBS Broadcasting S.à.r.l.,
the former PKS Media S.à.r.l. This exchange fits
entirely within the international ambitions of
TMG. The enterprise thus acquires a share in the
international growth of SBS and obtains access
to a broader international media platform.
Permira and Kohlberg Kravis Roberts & Co. L.P.
(KKR) retain the operational control of SBS. TMG
will appoint members to the Supervisory Board
in proportion to the shareholding in SBS. TMG
also has certain rights in the event of a possible
future sale of SBS S.à.r.l. or SBS Nederland.
Earlier in 2005, TMG had accrued an interest of
2.4% in SBS Broadcasting S.A. (later known as
TVSL S.A. and now liquidated) worth € 29 million.
For this interest, TMG received approximately
€ 35 million from the liquidation of TVSL on
8 November 2005.
ANNUAL REPORT
koninklijk wegener n.v.
As at 31 December 2005, the share in Wegener
consisted of 10,594,763 depository receipts of
ordinary shares of € 0.30 nominal value (an interest of 23.9%) and 2,593,030 depository receipts
of 6.84% cumulative preference shares of € 0.30
nominal value (an interest of 61.7%).
The price as at 31 December 2005 was € 10
against a price of € 9.45 as at 31 December
20034. The average purchase price was € 5.74.
In accordance with the IFRS principles, the
interest in the depository receipts of ordinary
shares has been measured at fair value (stock
exchange value) of € 105.9 million at year-end
2005 compared to € 100.1 million at year-end
2004. At year-end 2003, the stock exchange
value amounted to € 73.1 million.
The capital gains over 2005 and 2004 of respectively € 5.8 million and € 27 million have been
incorporated in the income statement under
revaluation of financial fixed assets.
The financing preference shares carry a net
reimbursement of 6.84% per annum up until
year-end 2005. Commencing on 1 January 2006,
the reimbursement amounts to 5.33% per annum.
The result from participating interests includes
both the ordinary dividend, and the preference
dividend for 2005, received in 2005. The ordinary
and financing preference shares represent a
vote of 26,24% as of 2006.
am van gaal media b.v.
Telegraaf Media Groep N.V. has had a 20%
interest in AM van Gaal Media (AM Media) for
2005
41
two years now. The goal of the publisher is to
develop into a medium-sized publisher of public
magazines specially aimed at women. The
publisher issues the titles AM magazine
and Tweed.
m-media / media librium b.v.
Since November 2005, TMG has had a 40%
interest in Media Librium, an operator of digital
media. Media Librium has specialised in the
development and use of content on digital
screens and in connecting these screens to
back-office systems (such as company networks
and inventory systems). This uses the newest
methods, including narrowcasting (reaching
specific target groups by means of digital
screens providing information specially
designed for them).
M-Media, a subsidiary of Media Librium, has
provided a narrowcasting network for the
McDonald’s branches in the Netherlands since
September 2004, including the Channel-M
television channel and digital bill boards.
Additionally, M-Media uses a similar concept to
operate digital screens in several shopping
centres. For 2006, the company foresees
expansion of its networks to public transport,
retail sector organisations and public spaces.
Meanwhile, M-Media has also concluded a
strategic cooperation agreement with KPN that,
on the one hand, enables the company to
structurally reduce its costs for ICT and network
management considerably and, on the other,
creates the opportunities to benefit from KPN’s
strength in rolling out new networks.
ANNUAL REPORT
2005
43
corporate governance code
At the general meeting of 20 April 2005,
the shareholders approved the compliance
of TMG on the corporate governance code.
The Executive Board and the Supervisory Board
share the basic assumption of the Corporate
governance code that the company represents
a long-term collaboration of all parties involved
with the company. The interested parties are
the groups and individuals which directly and
indirectly influence the achievement of the
company’s objectives, or are being influenced
by it, such as employees, shareholders and
other investors, suppliers and customers, but
also the government and social institutions.
The Executive Board and the Supervisory Board
have an integral responsibility for the evaluation of these interests, which is generally aimed
at the continuity of the company. The Code is
effective from the financial year which began on
or after 1 January 2004.
In this section, Telegraaf Media Groep N.V.
(TMG) states the way in which it interprets
compliance with the Code. As a publisher of,
among other products, daily newspapers, TMG
is of the opinion that it also serves a social
interest besides the interest of the shareholders.
As a result of this, the continuity and independence of the group is considered to be of the
greatest importance. In some details, this leads
to choices which differ from those within the
code, which places shareholders’ value first and
foremost.
best practice provision ii. 1.1.
Period of appointment for a maximum
of four years.
The company’s policy is that a director is
employed by the company and is appointed for
an unlimited period. A periodical appointment
results in the risk of a conflict of interest
between the long term for the company and
the short term because of reappointment of the
director. The shareholders can annually exert
their influence during their meeting when
discharging the Executive Board from responsibility
for the policy pursued. The Supervisory Board
evaluates the Executive Board’s performance
annually.
principle ii.2. remuneration/ii.2.7
Maximum compensation for dismissal
of directors.
This principle is only partly shared. Every member of the Executive Board is in the service of
the company. Compensation for dismissal, if
applicable, and sometimes determined by the
competent court, also stems from this employment relationship. The new remuneration policy
for the Executive Board was approved by the
shareholders in the general meeting on 20 April
2005. The remuneration policy has a fixed part
and a variable part. The variable part involves
an individual bonus and the group’s profit-sharing scheme, which applies to each employee.
TMG does not have option schemes or remuneration in the form of shares.
44
ANNUAL REPORT
2005
best practice provision iii.2.1.
Independence of Supervisory Board members
with the exception of no more than 1 person.
If a majority of the Supervisory Board members
is independent, as intended in III.2.2. (dependence criteria), a sufficient guarantee for
independent supervision is provided. Because
of the social importance of our daily newspapers
and thus the long-term vision of the company,
much importance is attached to having more
than one Supervisory Board member who has a
high degree of involvement in the company
through experience or ownership of shares.
best practice provision iii.3.5
Maximum term of Supervisory Board members
Referring to that which is mentioned in III.2.1,
this provision is not shared and it is noted that
there are many functions in society which are
filled for a longer period. Experience and expertise are of great importance. Commitment to,
and knowledge of the company prevails.
best practice provision iii.5.
Composition and role of the key committees
of the Supervisory Board.
The Code states that in the case of a Supervisory
Board of more than four members, an auditing
committee, remuneration committee, and
appointment and selection committee should
be established. The present Supervisory Board
has five members. Because of the involvement of
the Supervisory Board members, their different
areas of expertise and the nature and size of our
company, one sees no reason to establish these
committees.
best practice provision iii.7.2.
Possible ownership of shares by a Supervisory
Board member in the company of which one
is a Supervisory Board member, for long-term
investment.
The law provides sufficient guarantees for preventing the improper use of knowledge or prior
knowledge.
best practice provision iii.7.3.
Regulations and statement of ownership
of shares of Supervisory Board members in
securities other than those issued by one’s
‘own’ company.
This provision is not supported: it is considered
to represent too great an infringement on the
privacy of Supervisory Board members.
best practice provision iv.2.2.
Members of the trust office’s board are
appointed by the management of the
trust office.
The present composition of the board complies
with Appendix X of the Fund’s Regulations. This
provides a good balance between guaranteeing
the interests of the certificate holders on the
one hand, and the company on the other hand.
In this context, reference is made to the
previous remark about the specific character of
the company and the social importance
ANNUAL REPORT
that daily newspapers represent. The Stichting
Beheer van Prioriteitsaandelen Telegraaf Media
Groep N.V. (the TMG priority share management trust) is entitled to make non-binding
recommendations for two of the five board
members. These members are of particular
importance to ensure that the affinity for and
solidarity with the company of so large a shareholder as the trust office, is guaranteed.
best practice provision iv.2.8.
Proxy votes
Holders of depositary receipts for shares can
unrestrictedly convert their depositary receipts
into shares in order to obtain the right to vote.
The board’s granting of a proxy vote to holders
of depositary receipts without cancellation is
not a problem. The binding voting instructions
from a depositary receipt holder to the board
are not supported, because the company is of
the view that those persons who wish to vote
should also be present at the shareholders’
meeting.
2005
45
best practice provision iv.3.1.
Webcasting or suchlike of analysts’ meetings,
analysts’ presentations, presentations for
institutional and other investors and press
conferences.
This provision is not shared insofar as it concerns
the ‘one on ones’. However, group presentations can be followed via webcasting. After they
finish, presentations will be placed on the
group’s website.
46
ANNUAL REPORT
2005
report on internal risk
management and
control systems
During the financial year, the control environment
has been analysed and evaluated, as have the
risks to which TMG is exposed. The most important components of internal risk management and
control systems in the financial year were:
•
A standard cycle for the annual planning and
reporting cycle;
•
Standard financial and non-financial procedures
and guidelines for the operating companies;
•
Since 2004, TMG has had an Internal Audit
department to ensure compliance with the
policy and the procedures as well as tracing and
tackling problems concerning the internal
control. The Internal Audit department reports
to both the Executive Board and to the
Supervisory Board.
•
Implementation of a formalised risk management policy within TMG.
For that purpose, an extensive Risk Assessment
Project was started in 2005 in order to further
improve the internal risk management and
control system.
The risk management project that was implemented during the financial year has provided
a clear contribution to the further improvement
of the effectiveness of the internal risk management and control systems. In 2006, follow-up
steps will be undertaken to provide additional
content and shape for the risk management
process. Besides holding more workshops at
strategic level, a project will be started in 2006
that will focus on the operational processes and
their associated financial processes. In this way,
TMG will try to obtain insight into where the
necessary steps must still be taken in order to
improve the risk management and internal
control areas at operational level.
The Executive Board of TMG is responsible for
the internal risk management and control
systems.
ANNUAL ACCOUNTS
2005
47
consolidated income statement
Note*
2005
2004
Net turnover
1
736,686
694,320
Other operating revenues
3
2,806
1,949
739,492
696,269
Amounts in thousands of euros.
Total revenues
Raw materials and consumables
4
Wages and salaries
Social security and pension charges
5
76,699
74,117
212,293
207,153
14,668
41,749
10,11
41,509
39,877
6
341,088
307,069
686,257
669,965
53,235
26,304
Share in the results of associates
9,761
7,197
Net financing result
5,610
4,400
Revaluation of non-current financial assets
5,777
26,712
Depreciation and amortisation
Other operating costs
Total operating costs
Operating profit
1
Other financial income and expenses
Balance of financial income and expenses
7
Pre-tax profit
Corporation tax
8
Net result
10,582
13,217
31,730
51,526
84,965
77,830
19,876
10,049
65,089
67,781
65,428
67,709
Allocated to:
Shareholders of Telegraaf Media Groep
Minority interest share
Net result
-339
72
65,089
67,781
65,428
67,709
52,499,200
52,499,200
€ 1.25
€ 1.29
Result per share
Net result allocated to the holders of
ordinary shares in Telegraaf Media Groep N.V.
Average number of ordinary shares issued
Ordinary and diluted profit per share (EUR)
* Inhoudsopgave toelichtingen geconsolideerde jaarrekening zie pag 65.
20
48
ANNUAL ACCOUNTS
2005
consolidated balance sheet
Notes
31-12-2005
31-12-2004
Property, plant and equipment
10
167,163
181,876
Non-current intangible assets
11
178,531
148,852
Interests in associates
12
99,069
43,981
Deferred tax credits
14
-
4,965
Other non-current financial assets
13
Amounts in thousands of euro’s.
assets
Non-current assets
Total non-current assets
132,382
132,998
577,145
512,672
Current assets
Inventories
16
8,498
14,372
Other investments
13
2,361
6,475
9
29,995
27,812
17
103,128
84,474
Tax credits
Trade receivables and other receivables
1843,334
Cash and cash equivalents
Assets held for sale
15
Total current assets
Total assets
1
91,268
6,906
-
194,222
224,401
771,367
737,073
ANNUAL ACCOUNTS
Amounts in thousands of euro’s.
2005
49
Notes
31-12-2005
31-12-2004
19,33
530,468
480,595
equity and liabilities
Shareholders’ equity
Allocated to Telegraaf Media Groep N.V.
Minority interest share
688
473
531,156
481,068
Liabilities
Interest-bearing loans and other
non-current financing liabilities
21
3,078
1,175
Provision for employee benefits
22
18,029
53,102
Restructuring provision
23
27,699
35,917
Deferred tax liability
14
11,213
-
60,019
90,194
Total non-current liabilities
Interest-bearing loans and other
current financing liabilities
Trade and other payables
24
Total current liabilities
Total commitments
Total equity and liabilities
1
432
-
179,760
165,811
180,192
165,811
240,211
256,005
771,367
737,073
50
ANNUAL ACCOUNTS
2005
consolidated cash flow statement
2005
2004
Total revenues
739,492
696,269
Total operating costs
686,257
669,965
53,235
26,304
- depreciation and amortisation
41,509
39,877
- changes in current receivables
-9,401
2,588
6,228
6,715
Amounts in thousands of euro’s.
Cash flow from operating activities:
Operating profit
Restatements for:
- changes in inventories
- changes in trade payables and
6,185
6,511
-43,316
-9,605
Cash flow from operations
54,440
72,390
Dividends received from associates
18,143
1,424
5,610
4,400
Tax paid on the profit
-4,593
-11,908
Cash flow from operating activities
73,600
66,306
other current liabilities
- changes in provisions
Other financial income and expenses
ANNUAL ACCOUNTS
Amounts in thousands of euro’s.
Cash flow from operating activities
2005
51
2005
2004
73,600
66,306
-35,601
-18,181
Cash flow from investing activities
Investments in non-current intangible assets
Acquisition or divestment of group entities
and other financial assets
-51,310
8,909
Investments in property, plant and equipment
-25,007
-18,707
-755
-8,240
Changes in investment creditors
Divestments of property plant and equipment
3,724
7,010
Changes in securities
4,114
-2,904
-104,835
-32,113
-15,750
-5,775
Cash flow from investing activities
Cash flow from investing activities
Dividend paid out
Changes in non-current liabilities
Cash flow from financing activities
Exchange differences
Changes in cash and cash equivalents
-1,144
579
-16,894
-5,196
195
-40
-47,934
28,957
52
ANNUAL ACCOUNTS
2005
consolidated statement
of changes in equity
Reserve for
Total
exchange rate
Retained
shareholders’
Share capital
differences
earnings
equity
Balance as at 1 January 2004
13,125
114
405,463
418,702
Result for the financial year
-
-
67,709
67,709
Foreign currency differences
-
-41
-
-41
Dividend to shareholders
-
-
-5,775
-5,775
13,125
73
467,397
480,595
Amounts in thousands of euro’s.
Balance as at 31 December for
allocation to Telegraaf Media Groep N.V.
Minority interest share
473
481,068
Balance as at 1 January 2005
13,125
73
467,397
480,595
65,428
Result for the financial year
-
-
65,428
Foreign currency differences
-
195
-
195
Dividend to shareholders
-
-
-15,750
-15,750
13,125
268
517,075
530,468
Balance as at 31 December to allocate
to Telegraaf Media Groep N.V.
Minority interest share
688
531,156
ANNUAL ACCOUNTS
2005
53
accounting and
consolidation policies
important principles
for financial reporting
Telegraaf Media Groep N.V. (‘the Company')
has its registered office in Amsterdam, the
Netherlands, and is primarily involved in
publishing print media and operating and
participating in digital media, radio and TV.
The Company’s shares are listed on EuroNext
Amsterdam.
The consolidated financial statements of the
Company for the 2005 financial year cover the
Company and its subsidiaries (together called
‘the Group’) and the holdings of the Group in
associates and entities that are jointly controlled
with others.
The executive board prepared the financial
statements on 15 March 2006.
declaration of conformity
The consolidated financial statements have
been drawn up in accordance with International
Financial Reporting Standards (IFRS) drawn
up by the Inter-national Accounting Standards
Board (IASB) and approved by the European
Commission and the interpretations of these
standards by the IASB.
This is the first time that the Group’s consolidated financial statements have been compiled
in accordance with IFRS. In drawing up these
financial statements, IFRS 1 has been applied,
with a transition date of 1 January 2004.
An explanation of the effects of the transition to
IFRS on the reported financial position, financial
results and cash flows of the Group is included
in section 33 of the notes.
accounting policies applied
in drawing up
the financial statements
The financial statements are presented in euros,
rounded to the nearest thousand. The financial
statements are based on historical costs, except
that financial instruments held for sale or classified as available for sale are valued at fair value.
Non-current assets held for sale and divested
group assets are valued at the lower of the
book value and the fair value less selling costs.
The compiling of the financial statements in
conformity with IFRS requires that the management makes estimates and evaluations and
should specify the assumptions that influence
the application of the accounting policies and
the reported value of assets and liabilities,
and of income and expenditure. The estimates
and the associated assumptions are based on
past experience and various other factors that
are regarded as reasonable in view of the
circumstances. The outcomes of these constitute the basis for an evaluation of the book
value of assets and liabilities where this is not
easily apparent from other sources. The actual
results may deviate from these estimates.
The estimates and underlying assumptions are
critically reviewed from time to time. Revisions
of the estimates are recognised in the period
in which the estimate is revised, if the revision
has consequences only for that period. If the
54
ANNUAL ACCOUNTS
2005
revision has consequences for both the revision
period and future periods, the revision is
revised in both the period of revision and future
periods.
Evaluations made by the management, in
relation to the application of the IFRS, which
have important consequences for the financial
statements, and any estimates that entail a
considerable risk of a material restatement in
the following year are reported in section 32 of
the notes.
The financial reporting policies set out below
have been consistently applied for the periods
of 2005 and 2004 presented in these consolidated financial statements, and also in drawing up
the IFRS opening balance on 1 January 2004, as
required for the transition to IFRS.
consolidation policies
The financial figures for the parent company
Telegraaf Media Groep N.V., its subsidiary companies and joint ventures are incorporated in
the consolidation. The consolidation has been
based on the valuation and accounting policies
of the parent company.
Subsidiary companies
Subsidiary companies are entities over which
the company exercises control.
There is a relationship of control if the Company
is able to directly or indirectly determine the
financial and operational policy of an entity in
order to benefit from the activities of the entity.
In determining whether there is a relationship
of control, potential voting rights that cannot
be exercised at that time or that are convertible
are taken into account. The financial statements
of subsidiary companies are recognised in the
consolidated financial statements from the date
on which a relationship of control first arises,
until the moment at which this ends.
Associates
Associates are entities in which the Group has a
significant influence on financial and operational
policies, but does not have control.
The consolidated financial statements include
the Group’s share of the total results of associates in accordance with the 'equity' method,
from the date at which the Group first acquires
a significant influence, to the date at which it
last has a significant influence. If the Group’s
share of the losses is larger than the value of the
holding in an associated company, the book
value of the entity on the Group’s balance sheet
is written off to zero, and no further losses are
taken into account except in so far as the Group
has entered into a legally enforceable or actual
commitment, or has made payments on behalf
of the associated company.
Joint ventures
Joint ventures are those entities over which the
Group exercises a joint control with others, and
where this control is contractually specified.
The consolidated financial statements include
the Group’s proportional share in the assets,
commitments, revenues and costs of the entity,
with each individual accounting item being
combined with items of a similar nature, from
the date at which the joint control was first
exercised, up to the date on which it ends.
ANNUAL ACCOUNTS
Elimination of transactions
in the consolidation
Intra-group balances and any unrealised profits
and losses on transactions within the Group, or
income and expenditure from such transactions,
have been eliminated when drawing up the
consolidated financial statements.
Unrealised profits derived from transactions
with associates and entities over which the
Group exercises joint control have been eliminated in proportion to the Group’s holding in
the entity.
Unrealised losses are eliminated in the same
way as unrealised profits, providing there is no
indication of an impairment.
foreign currencies
Transactions in foreign currencies
Transactions denominated in foreign currencies
are translated into euros at the exchange rate
applicable on the date of the transaction.
Monetary assets and liabilities denominated in
foreign currencies are translated into euros on
the balance date at the exchange rate applicable
on that date.
Exchange rate differences arising from the
translation are recognised in the income statement. Non-monetary assets and commitments
that are denominated in foreign currencies and
valued on the basis of historical costs, are translated at the exchange rate applying on the date
of the transaction. Non-monetary assets and
liabilities in foreign currencies that are recognised
at fair value are translated into euros at the
2005
55
exchange rates that applied on the dates
on which the real values were determined.
Financial statements of foreign activities
The assets and liabilities of foreign activities,
including goodwill and fair value corrections
arising during consolidation, are translated into
euros at the exchange rate applicable on the
balance sheet date. The revenues and costs of
these foreign activities have been translated
into euros at a rate that approximates the
exchange rate on the date of the transaction.
Differences arising from currency translations
are recognised immediately, in a separate section
of the equity.
Net investments in foreign activities
Currency exchange differences resulting from
the translation of net investments in foreign
activities are incorporated in the reserve for
currency translation differences. In the event
of a sale, they are transferred to the income
statement.
property, plant and equipment
Assets owned
Property, plant and equipment are valued at cost
less cumulative depreciation (see below) and
impairment (see the principle for impairment
revaluations on page 58).
Non-current assets under construction are valued
at the amount spent for new construction,
machines and installed equipment.
Expenditure after initial recognition
The Group recognises the cost of replacing part
of a property, plant and equipment asset in the
56
ANNUAL ACCOUNTS
2005
book value of that asset, when the cost is incurred, if it is probable that the future economic
advantages in relation to the asset will accrue
to the Group, and if the cost of the asset can be
reliably determined. All other costs are recognised
as expenditure in the income statement when
they are incurred.
Depreciation
Depreciation is charged to the income statement using the linear method on the basis
of the estimated useful life of each part of a
property, plant and equipment asset. Land is
not depreciated.
The estimated useful life is as follows:
20 to 25 years
• business premises
5 to 10 years
• plant and machinery
5 years
• other operating assets
The residual value is critically evaluated each
year, except where it is not significant.
intangible assets
Goodwill
Acquisitions are incorporated into the accounts
using the acquisitions method.
Goodwill concerns an amount resulting from the
acquisition of subsidiary companies, associates
and joint ventures. For company acquisitions
that occurred after 1 January 2004, goodwill is
the same as the difference between the purchase price of the acquisition and the net fair
value of the identifiable assets, liabilities and
contingent liabilities.
In the case of acquisitions before this date,
goodwill is based on the supposed purchase
price, which is equal to the value that was
recognised under the previously applied GAAP.
The classification and incorporation of business
combinations that occurred before 1 January 2004
has not been modified in drawing up the IFRS
opening balance as at 1 January 2004 (see section
33 of the notes).
Goodwill is valued at cost less cumulative
impairment. Goodwill is attributed to cash
generating units and is not amortised. Instead,
there is an annual evaluation to see whether
there has been an impairment (see the principle
for impairment on page 58). For associates, the
book value of the goodwill is recognised in the
book value of the investment in the associated
company.
Where a holding in a subsidiary company,
associated company or joint venture is sold, the
corresponding goodwill is included in determining the profit or loss on the book value.
Negative goodwill that arises in an acquisition is
taken directly to the income statement.
Other intangible assets
Other non-current intangible assets concern
licensing rights for information systems (developed
in-house) for own use, and temporary publishing
rights. These intangible assets acquired by the
Group are valued at cost, less cumulative amortisation (see below) and impairment (see the
principle for impairment on page 58).
Expenditure on research activities is recognised
as an expense in the income statement when it
is incurred.
ANNUAL ACCOUNTS
2005
57
Expenditure for development activities, where
the research results are used for 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, is separately identifiable,
the costs can be reliably determined and the
Group has sufficient resources to complete the
development.
The amortisation of other intangible assets starts
as soon as the assets are ready for use.
The capitalised costs comprise the material costs,
direct labour costs and the directly attributable
part of the indirect costs. For the part that is
capitalised and concerns internal hours, a legal
reserve will be formed. The other development
costs are recognised as expenses in the income
statement when they are incurred.
investments
The capitalised development costs are valued
at cost less cumulative amortisation (see below)
and impairment (see the principle for impairment on page 58).
When the Group has the express intention of
holding government bonds to maturity, and
is able to do so, these are valued at amortised
purchase cost less impairment (see the principle
for impairment on page 58).
Expenditure after initial recognition
Expenditure for capitalised intangible assets
after their initial recognition is treated as
expenditure in the income statement, unless
the expenditure increases the future economic
advantages incorporated in the specific asset
to which it relates. In that case, the costs are
capitalised in so far as the economic advantages
are increased.
Amortisation
Amortisation is linear and is booked to the
income statement. It is based on the estimated
useful life of the intangible asset, unless this
useful life is indeterminate.
The estimated useful life of intangibles is as
follows:
• publishing rights
• software
8 to 20 years
3 to 5 years
Investments in debt instruments and shares
Financial instruments held for trading purposes
are classified as current liquid assets and valued
at fair value, and the profit or loss when they
are sold is recognised in the income statement.
Other financial instruments held by the Group
are classified as held available for sale, and are
valued at fair value. The resulting profits or
losses from their sale are booked directly to the
shareholders’ equity, subject to impairments
and (in the case of monetary items such as debt
instruments) exchange rate differences.
When these investments are no longer recognised
on the balance sheet, the cumulative profit or
cumulative loss that has been booked directly
to the equity is recognised in the income statement. Where the instruments are interest-bearing
investments, the interest is recognised in the
income statement using the effective rate of
interest method.
58
ANNUAL ACCOUNTS
2005
The fair value of the financial instruments that
are classified as held for sale and available for
sale is the bid price on the financial market, on
the balance sheet date.
Financial instruments classified as held for
sale or available for sale are recognised on the
balance sheet of the Group at the moment that
the commitment to purchase the investment
is entered into, and are excluded from the
balance when a commitment to sell them is
established.
Investments held to maturity are recognised on
the balance sheet at the moment that they are
transferred to the Group, and are removed from
the balance sheet when they are transferred
from the Group.
other financial assets
Other financial assets consist of participating
interests, prepaid operational leases and
non-current receivables. These participating
interests, in which the Group does not exercise significant influence, are recognised at fair
value. Prepaid operational leases comprise the
purchased leaseholds of the grounds on the
campus in Amsterdam. These are amortised
using the straight-line method over the duration of the leaseholds concerned. Non-current
receivables are recognised at cost less attributable transaction costs. They are subsequently
valued at the amortised purchase cost, with any
difference between the purchase cost and the
amount to be repaid being recognises in the
income statement using the effective interest
rate method over the term of the loan.
inventories
Inventories are recognised at cost, or net realisable value if this is lower. The net realisable
value is the estimated selling price as part of
normal operations, less the estimated costs of
completion and the sales cost.
The cost price of the inventories is based on the
'first in, first out' (FIFO) principle and includes
the expenditure involved in acquiring the
inventories and moving them to their current
location and placing them in their present
position.
trade receivables
and other receivables
Trade receivables and other receivables are
valued at cost, less impairment (see the principle
for impairment on page 58).
cash and cash equivalents
Cash and cash equivalents consist of cash and
bank balances and other demand deposits.
impairments
The book value of the assets of the Group, with
the exception of inventories (see above) and
deferred tax assets (see page 63), is reviewed on
each balance sheet date to determine whether
there are reasons for an impairment. If there are
such reasons, the realisable value of the asset
is estimated (see the basis for calculating the
realisable value on page 59).
ANNUAL ACCOUNTS
For goodwill, assets with an indefinite useful
life and intangible assets that are not yet ready
for use, the realisable value is estimated on
each balance sheet date. An impairment loss
is recognised when the book value of an asset
or the cash-generating unit to which the asset
belongs is higher than the realisable value.
Impairments are recognised in the income
statement. Impairments recognised in relation
to cash generating units are first subtracted
from the book value of any goodwill allocated
to cash generating units (or groups of units),
and then proportionally subtracted from the
book value of the other assets of the unit (or
group of units).
Goodwill and intangible assets with an indefinite useful life were tested for impairment on
1 January 2004, the date of transition to the
IFRS, even if there was no reason to suspect
that there had been an impairment.
If a drop in the fair value of a financial asset that
is available for sale has been recognised directly
in the shareholders’ equity, and there are
objective indications that the asset has suffered
an impairment, the cumulative loss that has
been directly booked to equity is recognised in
the income statement, even though the financial
asset has not been removed from the balance
sheet. The cumulative loss that is recognised in
the income statement is the difference between
the acquisition price and the current fair value,
less any impairment on that financial asset,
which has previously been recognised in the
income statement.
2005
59
Calculation of the realisable value
The realisable value of the Group’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 of the initial recognition
of these financial assets). Receivables with a short
residual term are not discounted to present value.
For the other assets, the realisable value is the
realisable value, or the operational value if this
is higher. In determining the operational value,
the present value of the estimated future cash
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 that
are significantly independent of those of other
assets, the realisable value is determined for the
cash-generating unit to which the asset belongs.
Reversal of impairments
An impairment loss for a security held to
maturity or a receivable valued at the amortised
cost of acquisition is reversed if an increase in
the realisable value occurring after this loss was
booked can be objectively related to an event
that has occurred after this impairment loss was
recognised. An impairment loss on an investment in an equity instrument classified as
available for sale is not reversed in the income
statement . If the fair value of a debt instrument
available for sale is rising, and the increase can
be objectively related to an event that occurred
after the impairment loss was recorded in the
income statement, the impairment must be
60
ANNUAL ACCOUNTS
2005
reversed, with the amount of the reversal being
recognised in the income statement. No impairments are reversed for goodwill. For other
assets, an impairment loss is reversed if the
estimates on which the realisable value was
based are changed.
An impairment is only reversed in so far as the
book value of the asset is not higher than the
book value, after deducting depreciation or
amortisation that would have been applied if
no impairment loss had been recognised.
recognised interest-bearing loans
Interest-bearing loans are recognised at cost
less attributable transaction costs. After the
initial recognition, interest-bearing loans are
valued at the amortised cost price, with any
difference between the cost price and the
amount to be repaid being recognised in the
income statement using the effective interest
rate method over the term of the loan.
provisions
A provision is recognised on the balance sheet
if the Group has a legally enforceable or actual
commitment as a result of an event in the past,
and it is probable that an outflow of funds will
be required to meet that commitment.
If the effect of this is material, the provisions
are determined by discounting the expected
future cash flows to present value using a
pre-tax discount rate that reflects the current
market valuation of the time value of money
and, where necessary, the specific risks related
to the commitment.
Restructuring provision
A provision for restructuring is recognised when
the Group has approved a detailed and formal
restructuring plan, and a start has been made
with the restructuring or it has been publicly
announced. No provision is made for future
operating costs.
Provision for employee benefits
The Group has established various pension
schemes, some under its own management
and some placed with external parties, such as
industrial pension funds and insurance companies. On the basis of IAS 19, a number of these
schemes have been classified as defined benefit
schemes.
The net commitment of the Group under
defined benefit schemes is calculated separately
for each scheme, by estimating the pension
rights that employees have accumulated in
exchange for their services during the accounting
period and previous periods.
These pension rights are discounted to determine their present value, and the fair value of
the fund’s investments are subtracted from this.
The discount rate is the return, on the balance
sheet date, on company bonds with a creditworthiness rating of AAA and a term approximately equal to the term of the Group’s
commitments. The calculation is carried out by
a recognised actuary using the 'projected unit
credit' method.
All actuarial profits and losses are recognised as
at 1 January 2004, the date of the transition to
IFRS. In relation to actuarial profits and losses
arising after 1 January 2004 in the course of
ANNUAL ACCOUNTS
calculating the Group’s commitments under a
pension scheme, in so far as the unrecognised
cumulative actuarial profits or losses amount to
more than 10% of the present value of the gross
commitment under the defined-benefit pension
scheme, or 10% of the fair value of the fund’s
investments if this is higher, that part is recognised in the income statement over the expected
average remaining period of employment of
the employees who participate in the scheme.
Apart from this, actuarial profits or losses are
not recognised.
If the calculation results in a positive outcome
for the Group, the recognition of the asset is
limited to no more than the balance of any
unrecognised actuarial losses and pension costs
for completed years of service and the present
value of possible future refunds by the fund, or
of lower future pension premiums.
When the pension rights under a pension
scheme are changed, the part of the improved
pension rights that relate to employees’ years
of service (past service cost) is recognised as an
expenditure in the income statement, spread
linearly over the average period until the pension
rights become unconditional. In so far as the
claims are immediately unconditional, the
expenditure is immediately recognised in the
income statement.
The result ensuing from the curtailment or
termination of a defined benefit scheme is incorporated in the accounts as soon as the curtailment or termination takes place. The result
consists of the change in the present value of
the defined benefit commitments and the fair
value of the funds’ investments and any
2005
61
previous actuarial results and past service costs
that have not yet been accounted for. There is a
curtailment if there is a material reduction in
the number of workers who fall under the
pension scheme, or if the scheme itself changes
so that substantially lower rights will be granted
for future years of service.
Commitments relating to contributions to pension
schemes on the basis of defined contributions
are recognised as expenditure in the income
statement when the contributions are due and
payable.
trade debts and other payables
Trade debts and other payables are valued at cost.
revenues
Net turnover
The net turnover is the sum of the revenues
after deducting turnover tax and any applicable
discounts. Revenues from the sale of goods
are taken to the income statement when the
important risks and benefits of ownership are
transferred to the buyer. Revenues relating to
services provided are recognised in the income
statement in proportion to the performance
provided in that financial year.
No revenues are recognised if there are significant uncertainties concerning the collection of
the agreed fees, the associated costs for possibly returned goods, or if the management has
a continuing involvement with the goods.
62
ANNUAL ACCOUNTS
2005
If goods or services are exchanged for goods
or services of a similar nature and fair value,
this barter is not treated as a transaction that
generates revenue. If a barter exchange does
not meet this criterion, it is regarded as a
transaction that generates revenue. The amount
of this revenue is based on the fair value of the
received goods or services, plus or minus any
cash or cash equivalents received or paid (or
any assets that can be converted into cash in
the very short term).
If the fair value of the goods or services received
cannot be reliably determined, the revenue is
determined on the basis of the fair value of the
goods or services bartered in exchange plus or
minus any cash or cash equivalents received or
paid (or any assets that can be converted into
cash in the very short term).
Government subsidies
Government subsidies are initially recognised
on the balance sheet as prepayments received,
and are entered as revenue as soon as there is
reasonable certainty that they will be received
and that the Group will comply with the conditions involved. Subsidies that compensate for
costs incurred by the Group are systematically
recognised as revenues in the income statement,
in the same period in which these costs are
incurred.
received as incentives for entering into lease
agreements are recognised in the income statement as an integral part of the total lease costs.
Net financing result
The net financing result comprises the interest
expenses on funds withdrawn calculated using
the effective interest rate method, interest income from investments, dividends received and
currency exchange gains and losses.
Interest income is recognised in the income
statement using the effective interest rate
method. Dividend income is recognised in the
income statement at the moment the dividend
is announced.
tax on profits
Taxes on profits or losses over the financial year
comprise the current corporation tax liability
and deferred taxes for the reporting period.
The corporation tax is recognised in the income
statement in so far as it relates to items that are
entered directly to the equity, in which case the
tax is debited to the equity.
expenses
The current tax liability for the financial year is
the expected tax payable on the taxable profits
over the financial year, calculated on the basis
of tax rates that have been determined on the
balance sheet date, and corrections to the tax
liabilities for previous years.
Lease payments for operational leasing
Lease payments for operational leases are recognised in the income statement , spread linearly
over the period of the lease. Payments that are
The provision for deferred tax liabilities is formed on the basis of the balance sheet method,
under which a provision is made for temporary
differences between the book value of assets
ANNUAL ACCOUNTS
and liabilities for financial reporting purposes
and the book value of these items for tax purposes.
No provision is made for the following temporary
differences: goodwill that is not tax deductible,
the initial recognition of assets or liabilities
that do not affect either the commercial or
the fiscal profit, and differences that relate to
investments in subsidiary companies in so far
as they are unlikely to be disposed of in the
foreseeable future. The amount of the provision
for deferred tax liabilities is based on the way
the book value of the assets and liabilities are
expected to be realised or disposed of, using
the tax rates that have been determined on the
balance sheet date, or that have been materially
decided by the balance sheet date. A deferred
tax credit is only recognised in so far as it is
probable that there will in the future be taxable
profits available to realise the asset item. The
amount of the deferred tax credit is reduced in
so far as it is no longer probable that the corresponding tax benefit will be realised.
segmented information
A segment is a clearly distinguishable section
of the Group that provides goods or services
(known as a business segment), or that provides
those goods or services to a particular economic
region (a geographical segment), and that has
a risk and return profile that differs from other
segments.
2005
63
non-current assets held for sale
Immediately prior to reclassification as ‘held for
sale,’ the valuation of the assets (and all assets
and liabilities of group assets to be divested) is
brought up to date in accordance with the
applicable IFRS.
Non-current assets and group assets to be
divested, at the time of their initial recognition
as ‘held for sale,’ are then valued at the lowest
of the book value and the fair value less selling
costs.
Impairments at the first classification as ‘held
for sale’ are recognised in the income statement,
even if there is a revaluation. The same is true
for gains and losses arising from later revaluations.
A discontinued business activity is a part of the
Group’s activities that represents a separate
and significant business activity or a separate
and important geographical business area, or a
subsidiary company that has been taken over
exclusively with the intention of reselling it.
A business activity is classified as discontinued
when it is divested, or when it complies with
the criteria for classification as ‘held for sale,’
whichever occurs first. A group of assets to be
divested, that has been discontinued, can also
meet this criterion.
ANNUAL ACCOUNTS
2005
65
toelichting op de
geconsolideerde jaarrekening
inhoud
pag.
66
70
72
72
72
73
73
74
74
75
76
78
80
81
82
83
83
83
84
84
Toelichting
1. Gesegmenteerde informatie
2. Overname van dochterondernemingen
3. Overige bedrijfsopbrengsten
4. Grond- en hulpstoffen
5. Sociale- en pensioenlasten
6. Overige bedrijfskosten
7. Nettofinancieringslasten
8. Vennootschapsbelasting
9. Belastingvorderingen en -verplichtingen
10. Materiële vaste activa
11. Immateriële activa
12. Investeringen in geassocieerde
deelnemingen
13. Overige financiële vaste activa
14. Latente belastingvorderingen en verplichtingen
15. Vaste activa aangehouden voor verkoop
en beëindigde bedrijfsactiviteiten
16. Voorraden
17. Handels- en overige vorderingen
18. Geldmiddelen en kasequivalenten
19. Eigen vermogen
20. Dividend
pag.
85
86
88
89
89
90
90
90
91
92
93
94
95
Toelichting
21. Rentedragende leningen en overige
financieringsverplichtingen
22. Personeelsbeloningen
23. Voorzieningen
24. Handelsschulden en overige te
betalen posten
25. Financiële instrumenten
26. Operationele leaseovereenkomsten
27. Investeringsverplichtingen
28. Voorwaardelijke gebeurtenissen
29. Verbonden partijen
30. Belangen in joint ventures
31. Gebeurtenissen na de balansdatum
32. Schattingen en oordeelsvorming
door de leiding
33. Verklaring van de overgang naar IFRS
66
ANNUAL ACCOUNTS
2005
1. segmented information
Segmented information is provided concerning the Group’s business segments and geographical segments.
The primary basis of segmentation, that of the business segments, is based on the management and internal reporting
structure of the Group.
The prices for transactions between segments, principally printing and distributing newspapers and providing ICT
projects and infrastructure, are mainly determined on the basis of business and objective principles.
The results, assets and liabilities of a segment include items that can be attributed to the segment directly, or based
on reasonableness. Unattributed items consist mainly of items which must be allocated at group level.
The capital expenditure of a segment concerns the total of the expenses incurred in the reporting period for the
purchase of assets for the segment that are expected to be used for longer than one reporting period.
Business segments
The Group identifies the following main business segments:
- Publishing: The publishing of national and regional newspapers, periodicals and free local (door-to-door) papers.
- Other: Other activities include, among other things, printing and distributing newspapers, providing office space
and associated facilities, providing (internal) ICT services, organising exhibitions and trade fairs, and the operation
of mobile-telephone services.
ANNUAL ACCOUNTS
2005
67
Other*
Amounts in thousands of euro’s.
Publishing*
activities
Eliminations Consolidated
2005
664,936
71,750
-
4,142
291,878
-296,020
-
Net turnover
669,078
363,628
-296,020
736,686
Segment result
39,569
5,332
-
44,901
Revenues from transactions with third parties
Revenues from transactions with other segments
736,686
8,334
Unattributed revenues and expenses
Operating profit
53,235
Share in results of associates
9,761
Net financing result
5,610
5,777
Revaluation of non-current financial assets
10,582
Other financial income and expenses
-19,876
Corporation tax
Profit for the financial year
Segment assets
65,089
344,741
360,539
-511,953
193,327
99,069
Investments in associates
Unattributed assets
478,971
Total assets
771,367
Equity of the segment
54,366
-27,032
-27,208
Segment liabilities
290,375
387,571
-484,744
Total equity and liabilities
771,367
85
Unattributed depreciation and amortisation
11,367
30,057
-
Total depreciation and amortisation
Total number of FTEs
Unattributed FTEs
Total number of FTEs
193,202
47,697
Unattributed liabilities
Depreciation and amortisation
126
530,342
Unattributed equity
41,424
41,509
2,829
1,463
-
4,292
70
4,362
* All segments concern continuing business activities. For post-balance sheet events with an impact on these activities,
please refer to note 31. Post-balance sheet events.
68
ANNUAL ACCOUNTS
2005
Other*
Amounts in thousands of euro’s.
Publishing*
activities
Eliminations Consolidated
2004
Revenues from transactions with third parties
643,654
50,666
-
1,223
289,282
-290,505
-
Net turnover
644,877
339,948
-290,505
694,320
Segment result
40,815
-2,144
-
38,671
Revenues from transactions with other segments
Unattributed revenues and expenses
694,320
-12,367
Operating profit
26,304
Share in results of associates
7,197
Net financing result
4,400
Revaluation of non-current financial assets
26,712
Other financial income and expenses
13,217
Corporation tax
-10,049
Profit for the financial year
Segment assets
67,781
365,866
402,733
-601,498
Investments in associates
167,101
43,981
Unattributed assets
525,991
Total assets
737,073
Equity of the segment
58,707
-22,419
-35,941
Unattributed equity
Segment liabilities
307,160
425,152
-565,557
Unattributed liabilities
737,073
Unattributed depreciation and amortisation
130
8,925
30,822
-
Total depreciation and amortisation
Total number of FTEs
Unattributed FTEs
Total number of FTEs
166,755
89,723
Total equity and liabilities
Depreciation and amortisation
347
480,248
39,747
39,877
2,851
1,427
-
4,278
38
4,316
* All segments concern continuing business activities. For post-balance sheet events with an impact on these activities,
please refer to note 31. Post-balance sheet events.
ANNUAL ACCOUNTS
2005
69
The net turnover includes an amount of 9,376 (2004: 3,775) for turnover from barter transactions.
Geographical segments
With the presentation of information on the basis of geographical segments, the geographical location of the
customers is the basis for the revenue of the segment. For the assets of the segments, the geographical location of
the assets is the basis.
The Publishing segment is mainly active in the Netherlands. The Group also publishes periodicals in Sweden and
the Ukraine. In view of their size, these are not shown as a separate segment. For these reasons, the assets
associated with these activities are not presented separately.
The division of the net turnover into geographical areas is as follows:
2005
2004
the Netherlands
715,128
673,844
Other countries
21,558
20,476
736,686
694,320
Amounts in thousands of euro’s.
Total
70
ANNUAL ACCOUNTS
2005
2. acquisition of subsidiary companies
In 2005, the Group acquired whole-ownership of Bongers Beheer B.V., Bohil Media B.V. and Mobillion B.V.:
Balance
Other
Purchase
acquired
intangible
Amounts in thousands of euro’s.
price1 )
assets
assets
Goodwill
Total
25,610
4,787
11,165
9,658
) Consisting of purchase price plus costs of financial and legal advice for the acquisition.
1
The balance of assets and commitments of the companies that have been taken over, before and after the date
of acquisition, valued under the IFRS system, can be summarised as follows:
Before
After
Amounts in thousands of euro’s.
acquisition date
acquisition date
Property, plant and equipment
6,032
6,032
-
11,165
Goodwill before acquisition date
692
692
Non current financial assets
265
265
Inventories
178
178
Trade and other receivables
5,578
5,578
Cash and cash equivalents
2,437
2,437
-275
-275
financing liabilities
-2,571
-2,571
Trade debts and other payables
-7,549
-7,549
4,787
15,952
Intangible assets
Provisions
Interest-bearing loans and other
Balance of identifiable assets and liabilities
Goodwill at acquisition
Total
9,658
25,610
ANNUAL ACCOUNTS
2005
71
From the acquisitions described below, commencing from the date of acquisition, the contribution to the consolidated
net profit in 2005 amounts to 1,228. If the acquisitions had already taken place on 1 January, the revenues and net
profit would have increased by 17,151 and 546 respectively.
Bongers Beheer B.V.
In January 2005, the Group, acting through its subsidiary De Trompetter B.V., acquired all the shares in Bongers
Beheer B.V. The business engages in publishing and distributing thematic free suburban newspapers in the Province
of Limburg, such as the magazines ‘Wonen’ and ‘Auto’s’ (living and cars). In addition, Bongers Beheer B.V. performs
printing orders for third parties.
The identified intangible assets with a total value of 2.954 relate to relationships with advertisers such as estate
agents, relationships with customers for its printing business, databases, titles and brand names. The intangible assets
will be amortised using the straight-line method over 8 years.
Bohil Media B.V.
After the acquisition of a 20% holding in Bohil Media in 2003, the Group purchased the remaining holding of 80%
in July 2005, with the result that the Group is now the whole owner. Bohil Media B.V. publishes diverse magazines
with advertisements for boats and caravans. The company also has various internet sites accessible in this field.
The identified intangible assets are primarily publication rights, titles, brand names and internet domain names
with a total value of 4,023, which will be amortised using the straight-line method over 8 years. In addition, 294 has
been capitalised for software licences, to be amortised in 3 years.
Mobillion B.V.
In July 2005 the Group expanded its 35% holding in Mobillion B.V. to 70%. In December 2005, the Group acquired
the remaining 30% interest. This acquisition strengthens the Group’s position in the market for added value
services in the field of 0900 numbers, SMS, MMS and Internet. Mobillion B.V.'s subsidiary company Sugababes is
active in the internet services market.
The identified intangible assets relate primarily to relationships with customers and brand names, with a total value
of 3,288, which will be amortised using the straight-line method over 8 years. In addition, 628 has been capitalised
for software licences, to be amortised in 3 years.
In October 2005 Mobillion B.V. expanded its 51% holding in its subsidiary Sugababes B.V. by purchasing an additional
19% interest.
72
ANNUAL ACCOUNTS
2005
3. other operating revenues
Amounts in thousands of euro’s.
Book profit on property, plant and equipment
2005
2004
251
1,949
Receipt of NDP contribution returned because of BBC sale
2,555
-
Total
2,806
1,949
2005
2004
71,385
70,042
4. raw materials and consumables
Amounts in thousands of euro’s.
Paper and ink
5,314
Other consumables
Total
4,075
76,699
74,117
Notes
2005
2004
26,151
25,868
Release of provisions due to scheme reduction
22
-32,339
-
Contributions to defined contribution schemes
22
13,705
8,529
5. social security and pension charges
Amounts in thousands of euro’s.
Compulsory social security contributions
Increased commitments for defined benefit schemes
Total
7,151
7,352
14,668
41,749
ANNUAL ACCOUNTS
2005
73
6. other operating costs
Amounts in thousands of euro’s.
Notes
2005
1,780
650
23
9,202
15,798
2004
Research and development costs, charged to the result
in the period in which they are incurred
Restructuring costs
Impairment of trade receivables
Outsourced work and technical production costs
Selling costs
Transport and distribution costs
2,617
572
40,788
25,503
37,841
29,654
125,407
116,495
28,699
Editorial costs
30,381
Other
93,072
89,698
Total
341,088
307,069
2005
2004
Share in the results of associates
9,761
7,197
Interest income
3,523
2,904
Dividends from non-associates
2,670
1,374
7. financial income and expenses
Amounts in thousands of euro’s.
157
235
-740
-113
Total net financial result
5,610
4,400
Revaluation of non-current financial assets
5,777
26,712
Other financial income and expenses
10,582
13,217
Total financial income and expenses
31,730
51,526
Result from securities
Interest expenses
The revaluations of non-current financial assets, in both 2005 and 2004, were primarily increases in the value of the
holding in Wegener N.V. to fair value. The other financial income and expenses in 2005 relate to the sale of interests
in the teletext activities of Media Groep West B.V. and the sale of the interest in SBS SA. In 2004, the non-recurring
book profit was attributable to the sale of the interests in ANP and Brouwer Group.
74
ANNUAL ACCOUNTS
2005
8. corporation tax
Recognised in the income statement
Amounts in thousands of euro’s.
2005
2004
3,368
6,833
625
68
16,440
3,223
Corporation tax liability
Financial year
Adjustments for previous years
Deferred taxes
Emergence and settlement of temporary differences
-557
-75
19,876
10,049
2005
2004
Profit before tax
84,965
77,830
Corporation tax on the basis of the Dutch tax rate
26,764
26,851
Reduced tax rates
Total corporation tax in the income statement
Reconciliation with the effective tax rate
Amounts in thousands of euro’s.
Effect of foreign tax rates
Non-deductible costs
Revenues exempt from corporation tax
6
-
734
272
-7,692
-17,051
-4
-16
Reduction of tax rate
-557
-75
Too little or too much (–) set aside in provisions in previous financial years
625
68
19,876
10,049
Tax credits not recognised in the income statement
9. tax credits and liabilities
The tax credit of 29,995 (2004: 27,812) relates to corporation tax that will be reimbursed for the period under review
and preceding periods. The tax liability of 1,820 relates to corporation tax over the reporting period and previous
years that is still to be paid, after deducting provisional payments.
ANNUAL ACCOUNTS
2005
75
10. property, plant and equipment
Amounts in thousands of euro’s.
Land and
Plant and
buildings
machinery
Other
Assets
operating
under
assets construction
Total
Book value as at 1 January 2004
Purchase price
217,653
247,775
154,573
10,312
630,313
Cumulative depreciation
122,376
179,073
120,586
-
422,035
95,277
68,702
33,987
10,312
208,278
Investments
1,060
720
8,784
8,134
18,698
Divestments
-1,015
-97
-1,606
-4,292
-7,010
Depreciation
-8,983
-11,298
-17,817
-
-38,098
669
3,670
1,992
-6,331
-
Book value
Changes in the book value
Put into operation
Exchange differences
-
-
8
-
8
Total of the changes
-8,269
-7,005
-8,639
-2,489
-26,402
Book value as at 1 January 2005
Purchase price
216,071
252,260
143,940
7,823
620,094
Cumulative depreciation
129,063
190,563
118,592
-
438,218
87,008
61,697
25,348
7,823
181,876
Book value
Changes in the book value
Reclassification
Investments
Acquired via business combinations
-
3,111
-3,111
-
-
870
3,429
15,044
5,450
24,793
1,816
3,481
735
-
6,032
Divestments
-66
-2,289
-1,304
-66
-3,724
Depreciation
-9,234
-12,094
-13,600
-
-34,928
8,654
341
1,204
-10,199
-
-
-
20
-
20
Reclassification as available for sale
-6,906
-
-
-
-6,906
Total of the changes
-4,866
-4,021
-1,011
-4,815
-14,713
Put into operation
Exchange differences
Book value as at 31 December 2005
Purchase price
209,800
267,954
141,569
3,008
622,331
Cumulative depreciation and impairments
127,658
210,278
117,232
-
455,168
82,142
57,676
24,337
3,008
167,163
Book value
76
ANNUAL ACCOUNTS
2005
Company premises are insured on the basis of reconstruction value, and the other assets on the basis of their new
value. The insured amount is 731,870 (2004: 714.000).
Property, plant and equipment under construction
The item ‘assets under construction’ refers to buildings and/or plant and machinery at: Telegraaf Drukkerij Groep B.V.,
Hollandse Dagbladcombinatie B.V., DistriQ B.V., Uitgeversmaatschappij De Telegraaf B.V., De Telegraaf Tijdschriften
Groep B.V. and Media Groep Limburg B.V.
11. intangible assets
Publication
Amounts in thousands of euro’s.
Book value as at 1 January 2004
Assets under
rights
Goodwill
Software
construction
Total
235
132,211
-
-
132,446
Changes in the book value
Investments
-
400
12,134
5,646
18,180
-21
-117
-1,641
-
1,779
Exchange differences
-
5
-
-
5
Total of the changes
-21
288
10,493
5,646
16,406
Book value as at 1 January 2005
214
132,499
10,493
5,646
148,852
4,925
-
7,534
6,959
19,418
10,265
9,658
924
-
20,847
Amortisation
Changes in the book value
Investments
Purchased via business combinations
Divestments
-
-
-943
-3,028
-3,971
Amortisation
-1,111
-
-5,470
-
-6,581
Exchange differences
-
-34
-
-
-34
Total of the changes
14,079
9,624
2,045
3,931
29,679
Book value as at 31 December 2005
14,293
142,123
12,538
9,577
178,531
Goodwill includes an amount of 111,697 (2004: 111,697) related to the purchase of ‘Dagblad De Limburger’ newspaper
in 2000. In addition, 12,000 (2004: 12,000) concerns synergy effects at Telegraaf Drukkerij Groep B.V. that ensue from
the transaction above.
ANNUAL ACCOUNTS
2005
77
Non-current intangible assets under construction
This item refers to IT systems (some developed in-house) used at Uitgeversmaatschappij De Telegraaf B.V. and
DistriQ B.V.
Impairment testing
The Telegraaf Media Groep N.V. has subjected all its cash generating entities that contain goodwill to an impairment test.
The realisable value of the cash generating units is based on calculations of the value in use. These calculations are
based on cash flow forecasts based on actual trading results, the budget for 2006 and long-term plans to 2008. In
addition, an allowance is made for the cash flows after 2008, which are extrapolated on the basis of growth of 0%.
The forecast cash flows are discounted to present value using a pre-tax discount rate of 7.7% (2004: 8.2%).
These calculations show that there have been no impairments during the period under review.
78
ANNUAL ACCOUNTS
2005
12. investments in associates
The Group has the following interests in associates:
Head office in
2005
2004
27.0%
Capital holding
SBS Broadcasting B.V.
SBS Broadcasting S.à.r.l.
Mobillion B.V.
Amsterdam
-
Luxembourg
21.4%
-
Ede
-*
31.5%
Amsterdam
-*
20.0%
Televisiebedrijf Limburg B.V.
Maastricht
45.0%
45.0%
Omroepbedrijf Limburg B.V.
Maastricht
40.0%
41.0%
De Nationale Regiopers B.V.
Almere
25.8%
25.8%
Expomedia Plc
London
20.0%
-
Amsterdam
40.0%
-
Bohil Media B.V.
Media Librium B.V.
Amsterdam
20.0%
20.0%
RKK B.V./C.V.
Vriezenveen
24.0%
24.0%
De Informatiefabriek vof
Kelpen-Oler
30.0%
-
The Hague
8.8%
8.8%
2005
2004
AM van Gaal Media B.V.
ANP Holding B.V.
Book value
SBS Broadcasting S.à.r.l.
SBS Broadcasting B.V.
Expomedia Plc
Media Librium B.V.
66,873
-
-
39,965
21,426
-
7,059
-
Other
3,711
4,016
Total
99,069
43,981
The Group’s share in the total achieved profit or loss after acquisition of the associates mentioned above over the
2005 financial year was 9,761 (2004: 7.197). For associates that have been written-down to zero, a provision of 88
has been formed for the share in further losses (2004: 1,700). This provision is included under the current liabilities.
The 25.8% interest (2004: 25.8%) in the Nationale Regiopers is a cooperative enterprise in advertising sales, together
with other publishers of regional newspapers in the Netherlands. The 8.84% shareholding in ANP Holding B.V. is
included under associates because TMG and other publishers jointly own 30% of this enterprise.
* Fully consolidated in 2005.
ANNUAL ACCOUNTS
2005
79
Summary of the financial data for the most important associates:
Shareholders’
Amounts in thousands of euro’s.
Assets
Liabilities
equity
Revenues
Profit/loss
3,538,921
3,549,627
-10,706
221,994
-28,888
8,454
4,723
3,731
1,989
-2,072
58,646
14,390
44,256
10,991
-1,215
325,393
177,340
148,053
269,045
26,867
2005
SBS Broadcasting S.à.r.l.
Media Librium B.V.
The 2005 figures for Expomedia Plc are not yet available.
The figures for the first half-year of 2005 are as follows:
Expomedia Plc
2004
SBS Broadcasting B.V.
SBS Broadcasting S.à.r.l.
At the end of December 2005, TMG completed the purchase of a 21.39% interest in SBS Broadcasting S.à.r.l. (20% after
dilution at start of 2006), a holding company in Luxembourg for all the activities of SBS. This interest was obtained
by exchanging the 27% interest that TMG had in SBS Broadcasting B.V. (the Netherlands), with an additional contribution of 17,818, determined as follows:
- Purchase of 21.39% of Shares and Shareholder loans in SBS Broadcasting S.à.r.l. for 192,159;
- Reinvestment of a one-off dividend payment of 18,142 by SBS Broadcasting B.V.;
- Reinvestment of 156,199 obtained from selling the 27% interest in SBS Broadcasting B.V.
The 21.39% interest in SBS Broadcasting S.à.r.l. can be broken down as follows:
Amounts in thousands of euro’s.
Shares
Interest-bearing Shareholders’ loans
Shareholders’ loans, interest-free
Total interest
Interest rate
Term in years
Purchase price
-
-
1,928
6.3375
49
171,222
-
49
19,009
192,159
80
ANNUAL ACCOUNTS
2005
The valuation of SBS Broadcasting S.à.r.l. consists of the valuation of SBS Broadcasting B.V. as at 1 January 2005,
the share in the results of 2005, the reinvestment of the dividend amount of 18,142, the payment of 17,818 plus the
costs directly attributable to the transaction.
Shareholders’ loans
The interest is calculated on a daily basis and can be paid in cash, in shares, or in new shareholders’ loans.
The payment of interest and the principal are subordinated to all payments from SBS Broadcasting S.à.r.l., with the
exception of share-related payments, such as dividends and repurchasing of shares. These conditions also apply to
the interest-free shareholders’ loans, with the exception of the interest calculations and payments stated above.
13. other non-current financial assets
Amounts in thousands of euro’s.
31-12-2005
31-12-2004
105,948
100,121
18,151
18,151
5,097
5,307
Non-current investments in assets
Interest in Wegener:
- (Depository receipts for) ordinary shares
- Preference shares
Operational lease paid in advance
Non-current receivables
Total
3,186
9,419
132,382
132,998
The ground lease included under Prepaid operational lease is amortised using the straight-line method for the
duration of the underlying ground lease contracts. The final instalment expires in 2039. In addition to the investments in
associates stated in note 12, the Group has a 23.9% holding (2004: 23.9%) in Wegener N.V., with a book value of
124,099 (2004: 118.272). Including cumulative funding preference shares, the capital interest is 27.14%. The total
controlling interest is 26.24%.
This holding is not regarded as a holding in an associate because it is only a share position, without significant influence
on the policy of the company. The share position has been treated by the group as a financial asset valued at fair
value, with changes of value being taken directly to the result. The fair value is based on the listed market price on
the balance sheet date, without deducting transaction costs.
ANNUAL ACCOUNTS
2005
81
14. latent tax credits and liabilities
The deferred tax credits and liabilities included on the balance sheet at the year-end can be attributed as follows:
2005
Assets
Liabilities
Balance
Property, plant and equipment
-
-1,811
-1,811
Provisions
-
-9,402
-9,402
Net tax credit/liability (–)
-
-11,213
-11,213
Assets
Liabilities
Balance
Property, plant and equipment
120
-1,800
-1,680
Intangible assets
858
-
858
-
-596
-596
Provisions
6,383
-
6,383
Net tax credit/liability (–)
7,361
-2,396
4,965
Amounts in thousands of euros
2004
Amounts in thousands of euros
Inventories
In some countries where the Group is active, the local legislation stipulates that profits are taxed at the moment the
profit is paid out. As at the balance sheet date, the total of such profit amounted to 391, which would result in a tax
liability of 90 if the subsidiaries were to pay out a dividend.
Deferred tax credits not recognised on the balance sheet
No latent tax claims have been recognised on the balance sheet concerning the losses or start-up losses of a number of
subsidiaries. The latent tax credit that has not been recognised amounted to 2,723 at the end of 2005 (2004: 2.512)
Almost all losses are off-settable without limitations.
82
ANNUAL ACCOUNTS
2005
Changes in temporary differences during the financial year
Situation
Recognised
(De-)
Situation
Amounts in thousands of euros.
1-1-2005
in result
Consolidation
31-12-2005
Property, plant and equipment
-1,680
164
-295
-1,811
858
-858
-
-
-596
596
-
-
6,838
-9,352
-
-2,514
Non-current intangible assets
Inventories
Employee benefits
Provisions
-455
-6,433
-
-6,888
4,965
-15,883
-295
-11,213
Situation
Recognised
(De-)
Situation
Amounts in thousands of euros.
1-1-2004
in result
Consolidation
31-12-2004
Property, plant and equipment
-1,826
128
18
-1,680
1,879
-1,021
-
858
Inventories
-1,072
476
-
-596
Employee benefits
10,040
-3,202
-
6,838
-926
471
-
-455
8,095
-3,148
18
4,965
Non-current intangible assets
Provisions
15. assets held for sale
In 2005, several business premises in the publishing segment were treated as held for sale; the business entities
concerned will move to another location during the course of 2006. The sales transactions are expected to be completed in 2006. Please refer to note ‘31. Post-balance sheet events’ in which the proposed divestment of our
activities in Limburg is described.
Assets classified as held for sale:
Amounts in thousands of euros.
Notes
2005
Property, plant and equipment
10
6,906
ANNUAL ACCOUNTS
2005
83
16. inventories
Amounts in thousands of euros.
2005
2004
13,223
Raw materials
6,361
Consumables
2,137
1,149
Total
8,498
14,372
2005
2004
Trade receivables
76,879
68,512
Other receivables
10,008
2,194
16,241
13,768
103,128
84,474
17. trade receivables and other receivables
Amounts in thousands of euros.
Prepayments and accrued income
Total
Trade receivables are presented after deduction of impairment. In the financial year, such losses have amounted to
11,555 for bad debts (2004: 12.704)
Fair value
For receivables that fall due within one year, the nominal value is considered to reflect the fair value.
18. cash and cash equivalents
2005
2004
Bank balances
24,858
65,313
Demand deposits
18,476
25,955
Cash and cash equivalents
43,334
91,268
Amounts in thousands of euros.
The cash, cash equivalents and securities are freely available.
The fair value is deemed to be equal to the nominal value.
84
ANNUAL ACCOUNTS
2005
19. shareholders’ equity
Share capital and share premium
As at 31 December 2005, the authorised share capital consisted of 200,000,000 ordinary shares and priority shares
(2004: 200,000,000), which were issued and paid up as follows:
2005
Thousands of shares.
Issued as at 1 January
Priority
Ordinary
Priority
shares
shares
shares
shares
52,499,200
960
52,499,200
960
-
-
-
-
52,499,200
960
52,499,200
960
Issued and paid up in cash
Issued as at 31 December (paid up)
2004
Ordinary
All shares have a nominal value of € 0.25. As at 31 December 2005, no preference shares have been issued. An overview of
the legal and articles of association provisions concerning the distribution of profits and the other rights under the
articles of association connected with the ordinary shares, priority shares and preference shares is included under Other
Information on pages 121 to 123.
Reserve for currency translation differences
The reserve for currency translation differences comprises all exchange differences for foreign currencies that arise as
the result of currency translations from the financial statements of foreign activities in Sweden and the Ukraine.
20. dividend
After the balance sheet date, the Executive Board proposed the dividend set out below. The dividend proposal has
not been incorporated in the balance sheet and has no consequences for the tax on profits.
Amounts in thousands of euros.
2005
2004
23,100
15,750
€ 0.44 per (depositary receipt for)
ordinary share (2004: € 0.30)
ANNUAL ACCOUNTS
2005
85
21. interest-bearing loans and other financing liabilities
This note contains information about the contractual provisions for the interest-bearing loans and other financing
liabilities of the Group. For more information about the interest rate risks and exchange rate risks facing the Group,
see section 25 of the notes.
31-12-2005
31-12-2004
217
0
Non-current loans
2,861
1,175
Total
3,078
1,175
Amounts in thousands of euros.
Investment liabilities
Conditions and repayment schedule
The non-current liabilities, all in euros, are mainly loans from the Rabobank amounting to 724 and from Graphic
Lease amounting to 1,803, made to Bongers Beheer B.V. The loan from the Rabobank is repaid in equal amounts
and must be redeemed by 2016 at the latest. The interest is linked to the base rate of the Rabobank and was 3.8%
at year-end 2005. The loan from Graphic Lease bears interest of 5.25% and is repaid in equal amounts, in 2011 at the
latest. Both loans are secured by pledges against movable property and a registration of mortgage on immovable
property. The effective interest rate on these loans is the same as the nominal rate.
Fair value
The fair value is calculated on the basis of the discounted future principal repayments and interest rate payments.
In discounting financial instruments, the entity has used the yield on government bonds as at 31 December 2005 as
a discount rate. The interest rate used is 4% (2004: 4.5%) The fair value is equal to the amortised acquisition cost
stated above.
86
ANNUAL ACCOUNTS
2005
22. provision for employee benefits
Amounts in thousands of euros.
31-12-2005
31-12-2004
31-12-2003
18,892
36,643
37,371
Cash value of financed liabilities
167,420
682,601
602,537
Cash value of liabilities
186,312
719,244
639,944
-148,226
-628,647
-576,413
38,086
90,597
63,531
-20,057
-37,495
-
18,029
53,102
63,531
Cash value of unfinanced liabilities
Fair value of fund investments
Cash value of net liabilities
Actuarial gains and losses not included
Commitment included for
defined benefit pension rights
Gross commitment for defined benefit pension rights
The Group contributes to three defined benefit pension schemes on the basis of which employees of the Group in
the Netherlands are paid pension benefits after they retire. In the calculation of the provision, account is also taken
of an allowance for the medical expenses of pensioners.
At year-end 2005, almost all of the most important pension scheme, Stichting Telegraafpensioenfonds 1959 (Telegraaf
pension fund trust), was transferred to a group defined contribution scheme. Moreover, the allowance for health
insurance for pensioners has been amended in line with the new national healthcare scheme. In addition, this allowance
is being phased out for (former) members that retire after 2005. Furthermore, the early retirement top-up scheme
has been revised because of the extensive cutbacks in the early retirement scheme for the printing and allied trades.
Due to these constraints on the pension schemes and the related release from the previously incorporated pension
commitment, a credit is accounted for in the result for 2005.
The most prominent actuarial assumptions as at the balance sheet date
In weighted averages.
2005
2004
Discount rate as at 31 December
4.0%
4.5%
Expected yield from fund investments as at 31 December
6.1%
6.1%
Future pay rises
2.5%
2.5%
Adjustment for inflation
2.0%
2.0%
Increase in social security benefit payments
2.0%
2.0%
ANNUAL ACCOUNTS
2005
87
Information concerning the actual yield on fund investments in 2005 are not yet available (2004: 8%).
The forecast yield is the weighted average expected return, based on the expected investment mix.
Movements in commitment for defined benefit pension schemes
Amounts in thousands of euros.
2005
2004
719,244
639,944
Service costs
19,739
13,989
Interest expenses
32,450
32,539
as at 1 January
Employee’s contribution
Actuarial losses
7,536
7,536
81,409
42,565
-656,737
-
-17,329
-17,329
186,312
719,244
2005
2004
628,647
576,413
Contributions
17,670
17,670
Expected yield
38,588
37,999
Release of provisions due to scheme reduction
Benefit payments
Movements in fair value of fund investments
Amounts in thousands of euros.
as at 1 January
Employee’s contribution
Actuarial gains
Release of provisions due to scheme reduction
Benefit payments
7,536
7,536
-
6,358
-526,886
-
-17,329
-17,329
148,226
628,647
The costs of defined contribution schemes also include the costs related to the early retirement scheme for the
printing and allied trades. This scheme qualifies for treatment as a defined benefit scheme. It is treated as a defined
contribution scheme because its share in the shortfall cannot be sufficiently reliably calculated. The same applies
for the industrial scheme for the prepension of newspaper journalists.
88
ANNUAL ACCOUNTS
2005
Furthermore, the following funds, for which the schemes also qualify for treatment as defined benefit schemes,
have informed us that they will not supply us with data for the calculation of (our share in) surpluses or shortfalls:
- Pensioenfonds Grafische Bedrijven (pensioenregeling grafici – graphic designers’ pension scheme)
- Stichting bedrijfstakpensioenfonds voor het beroepsvervoer over de weg (pensioenregeling goederenvervoer
– goods transporters’ pension scheme)
- Stichting vrijwillig vervroegde uittreding voor het beroepsgoederenvervoer over de weg en de verhuur van
mobiele kranen (vut regeling goederenvervoer – goods transporters’ early retirement scheme)
- Stichting Prepensioenfonds voor het beroepsgoederenvervoer over de weg en de verhuur van mobiele kranen
(prepensioenregeling goederenvervoer – goods transporters’ prepension scheme)
Incidentally, in none of the cases is there any obligation to remedy any shortfalls in the funds, nor are there any
entitlements concerning possible surpluses.
Expense included in the income statement
2005
2004
Pension costs attributed to year of service
19,843
13,989
Interest on the commitment
32,450
32,539
-38,588
-37,999
13,705
8,529
Amounts in thousands of euros.
Expected yield from fund investments
Total contribution to defined benefit schemes
Result from the restriction of the schemes
Contribution to defined contribution schemes
Total
-32,339
-
7,151
7,352
-11,483
15,881
2005
2004
23. restructuring provision
Amounts in thousands of euros.
Situation as at 1 January
Provisions formed during the financial year
Provisions used during the financial year
Situation as at 31 December
35,918
35,094
9,202
15,798
-17,421
-14,975
27,699
35,917
The restructuring provision concerns the liabilities involved in finding alternative employment, redundancy compensation,
relocation as well as retraining and additional training at Telegraaf Tijdschriften Groep B.V., Holland Combinatie B.V.,
ANNUAL ACCOUNTS
2005
89
Media Groep Limburg B.V., Hollandse Dagbladcombinatie B.V., Telegraaf Drukkerij Groep B.V., DistriQ B.V. and at
group level. Of this, 12.427 is a current liability. It is anticipated that the non-current portion will be finally spent in
2014 at the latest.
24. trade debts and other payables
31-12-2005
31-12-2004
Subscriptions paid in advance
54,503
54,786
Trade payables to suppliers
25,945
23,798
96
851
Amounts in thousands of euros.
Investment creditors
Trade payables to associated companies
2,352
-
Tax liabilities
1,820
-
Other liabilities, accruals and deferred income
Total
95,044
86,376
179,760
165,811
The fair value of the liabilities does not differ from the nominal value recognised here.
25. financial instruments
As part of its normal operations, the Group faces credit risks, interest rate risks and exchange rate risks. In addition,
the development of the price of paper can also affect the operating result. TMG faces credit risks if major customers
do not make their due payments, or do not make them on time. In the view of TMG, the conditions of payment
(which are general in the industry) and the relatively very limited reliance on individual customers make it unnecessary to use financial instruments to limit this risk.
Where there are significant exposures to exchange rate fluctuations, forward contracts are concluded to hedge the
risks within a period of one year. An exchange rate exposure is regarded as significant for an individual entity within
the Group if it exceeds a threshold value as a percentage of the turnover per calendar month, and the revenues
have a probability exceeding 50%.
The most relevant interest rate risk for TMG is the risk of a mismatch between the term of the financing that has been
obtained and the life expectancy of the assets that are financed with these moneys. In 2005, TMG did not use hedging to mitigate the interest rate risks and exchange rate risks of the Group or individual companies in the Group, and has
also not used hedge accounting. In the absence of capital market financing, TMG does not face specific interest rate risks.
TMG faces very limited exchange rate risks because of its activities outside the euro-zone, that is, in Sweden and
the Ukraine. The net cash flows to and from those entities, and the timing of those flows, are such that no significant
currency positions arise.
90
ANNUAL ACCOUNTS
2005
Of all the raw materials that are traded on the world market, TMG buys only paper in volumes so great that price
fluctuations could impact the operating result materially. TMG chooses not to hedge the risk of rising paper prices,
because (a) TMG already has long-term contracts with paper suppliers, and (b) the major paper manufacturers take
up such a position on the futures market, that this is insufficiently liquid to make hedging attractive for volumes
significant for TMG.
26. operational lease agreements
The amounts due under non-cancellable operational lease agreements become payable as follows:
Amounts in thousands of euros.
< 1 year
1 - 5 years
2005
2004
7,842
9,300
21,987
19,840
> 5 years
26,401
24,174
Total
56,230
53,314
Of the commitments with a term longer than 1 year, 32,007 relates to costs for the premises of Media Groep
Limburg. The commitments extend to October 2022. In addition, Telegraaf Media Events has entered into rental
agreements amounting to 5,273 and extending to 2020.
At the end of 2005, the liabilities under ground leases amounted to 5,097 (2004: 5.307). In the 2005 financial year,
an expense of 7,407 was recognised in the income statement for operational leasing (2004: 5.894).
27. investment liabilities
In the 2005 financial year, the Group entered into agreements for the purchase of property, plant and equipment,
for a sum of 4,792 (2004: 6.768). These investments relate mainly to premises for the Telegraaf Drukkerij Groep
(TMG’s printing group).
28. contingent liabilities
A number of TMG’s group entities face legal proceedings. These cases relate mainly to labour relations, rectifications
in publications and disputes with suppliers. Although the final outcome of the cases cannot be predicted with
certainty, the management of TMG does not expect that the outcome will have a material effect on the consolidated
financial position of the Group.
ANNUAL ACCOUNTS
2005
91
In the case of partnerships with third parties, established in the legal form of a commercial partnership (vennootschap
onder firma), the Group’s companies that participate in the partnership are jointly and severally liable for all debts of
the partnership.
At the end of 2005, bank guarantees to the value of 9,293 had been issued to cover the rental agreements that have
been entered into.
29. related parties
Identity of related parties
A ‘relationship between related parties’ exists between TMG and its subsidiary companies (see section 31 of the
notes), associates (see section 12 of the notes), joint ventures (see section 30 of the notes) and their Directors and
management functionaries.
The following shareholders have a holding of more than 20% in the capital of the Group.
31-12-2005
31-12-2004
Stichting Administratiekantoor Telegraaf Media Groep N.V.
62.7%
62.1%
N.V. Exploitatiemaatschappij Van Puijenbroek
29.6%
29.6%
Transactions with managers in key positions
The remuneration of managers is specified in the separate income statement (note 7). The total wages are included
under personnel costs (see section 6 of the notes to the consolidated financial statements).
Other transactions with related parties
Nature of
Outstanding
transaction
Size
balance
Associates
Turnover
17,847
-
Associates
Creditors
-
2,352 cr.
Joint Ventures
Turnover
385
-
Joint Ventures
Debtors
-
344 dt.
Thousands of shares.
All transactions with related parties concern transactions related to associates and joint ventures.
92
ANNUAL ACCOUNTS
2005
30. interests in joint ventures
The Group has holdings in the following joint ventures:
SBS Text V.o.F./V8 Fox Kids text. vof
Fitclub B.V.
Registered
Capital holding
Capital holding
office in
31-12-005
31-12-004
Amsterdam
-
45.0%
Groningen
75.0%
-
Amsterdam
50.0%
-
TTG Hearst AB
Stockholm
50.0%
50.0%
Telegraaf Expomedia Events vof
TTG Hearst B.V.
Amsterdam
75.0%
75.0%
TTG Sulake B.V.
Amsterdam
50.0%
-
De Modefabriek B.V.
Amsterdam
25.0%
-
Ludique Events B.V.*
Liempde
25.0%
-
R & R Expo vof *
Amsterdam
32.5%
-
SmartEvents B.V.
Rotterdam
50.0%
50.0%
Zeist
14.3%
14.3%
Adventure Holding B.V.
The following items in the consolidated financial statements correspond to the Group’s holdings in the assets and
liabilities, income and expenses of the joint venture:
Amounts in thousands of euros.
31-12-2005
31-12-2004
Non-current assets
1,913
309
Current assets
2,603
1,468
Non-current liabilities
-2,700
-1,958
Current liabilities
-4,788
-864
Balance of assets and liabilities
-2,972
-1,045
2005
2004
Amounts in thousands of euros.
Total revenues
5,826
3,755
Total expenses
-6,529
-3,680
Financial result
-43
-47
Corporation tax
-118
18
Net profit
-864
46
* Via joint venture Telegraaf Expomedia Events vof.
ANNUAL ACCOUNTS
2005
93
31. post balance sheet events
Acquisition of subsidiary companies after 2005
Sky Radio Limited
In February 2006, a consortium of the Group and ING Corporate Investment Participaties B.V. reached an agreement
concerning the acquisition of Sky Radio Limited from News International Limited for a total enterprise of 190,000.
Because the cross-ownership regulation in the Dutch Media Act does not permit the Group to hold an interest
larger than 33.33% in a national commercial broadcasting body, the Group has acquired a minority interest in Sky
Radio Limited. The Group has an option to acquire the 67.67% interest of ING Corporate Investment Participaties B.V.
if the Group’s share in the total circulation of the Dutch daily newspapers falls to less than 25%, or if the current
media regulations are relaxed.
The acquisition will be funded as follows:
Share from
Amounts in thousands of euros.
Share from
borrowed
equity
capital
Total
Telegraaf Media Groep N.V.
17,371
75,610
92,981
ING Corporate Investment Participaties B.V.
41,462
58,401
99,863
Management
Total
1,032
-
1,032
59,865
134,011
193,876
The acquisition price is 190,000; the costs of the acquisition to be capitalised amount to 3,876.
The loan capital acquired by the Group consists of a loan of 75,600 which will be contracted in the Group’s name.
The loan capital to be acquired by ING Corporate Investment Participaties B.V. will consist of a loan to be contracted
in the name of Sky Radio Limited. The financing structure outlined above will result in the Group acquiring a 49%
commercial interest in Sky Radio Limited. It is anticipated that the acquisition will be completed in April 2006, after
which the Group will commence the incorporation of the acquisition in the Groups financial figures.
Other acquisitions
On 1 January 2006, via the recently established business unit Telegraaf Classified Media B.V., the Group acquired a
70% interest in the internet dating websites Relatieplanet.nl and Iwannadate.nl. The acquisition of the 70% interest
means the Group has control of Relatieplanet and Iwannadate. Currently, the Group still has insufficient information
to recognise the fair value of the assets and liabilities.
94
ANNUAL ACCOUNTS
2005
In 2006, via a 50% interest in TTG Volgas VoF, Telegraaf Tijdschriften Groep B.V. will publish the Motoplus magazine.
Telegraaf Media Ukraine LLC acquired an 80% interest in LLC Telegraaf News Media in January 2006. This subsidiary
is going to publish the paper “Obzor”, which is based on the Sp!ts concept, 3 times a week in the Ukraine.
Uitgeversmaatschappij De Telegraaf B.V. has expanded its interest in Adventure Holding B.V. by 441. In addition, it has
taken a 40% holding in GS Media B.V. The acquisitions outlined above involved a total purchase price of some 14,000.
Other events
Due to the impossibility of achieving economies of scale, consideration is being given to divesting the activities in
Limburg. These activities comprise:
- Media Groep Limburg, publisher of newspapers including the dailies De Limburger and Limburgs Dagblad.
- Nieuwsdruk Limburg, printer for Media Groep Limburg, among others.
- De Trompetter, Kempen Pers and Bongers, publishers of free local (door-to-door) papers.
These enterprises will be offered for sale via a public tendering procedure. Telegraaf Media Group expects that the
sale will take place at a price above the book value during the second quarter of 2006. These activities fall under
the segments publishing (Media Groep Limburg) and other (Nieuwsdruk Limburg).
32. estimates and evaluations by the management
The Executive Board has discussed the development and choice of the significant accounting policies applied in
the financial reporting and estimates, the provision of information about these policies, and the application of the
policies and estimates, with the Supervisory Board.
The most important sources of uncertainty in the estimates
Note 11 contains information about the assumptions and the corresponding risk factors in relation to impairment of,
among other items, goodwill. During the financial year, goodwill of 142,123 (2004: 132,499) has been established with
no impairment required.
Assumptions with regard to pensions
The Group bases its expected long-term yield on assets on that used by De Nederlandsche Bank (the Dutch central
bank), taking into account the asset mix of the pension funds. If the expected return were to decline, the unrecognised actuarial results of TMG would be negatively affected. The pension charges for 2007 would also be affected.
If there was a decline in the long-term market interest rate, and thus also the discount rate, the commitments would
increase, and the unrecognised actuarial results would also increase. Both causes produce a risk that the unrecognised
actuarial results in 2006 might fall outside the bandwidth. In that case, the part outside the bandwidth would be
included in the pension charges commencing in 2007.
ANNUAL ACCOUNTS
2005
95
33. analysis of the transition to ifrs
As reported in the accounting policies section, these are the first consolidated financial statements prepared in accordance with IFRS. The principles for financial reporting presented there have been applied in the preparation of the
2005 financial statements, the comparative information on 2004 presented in these financial statements and for the
preparation of the IFRS opening balance sheet as at 1 January 2004 (TMG’s transition date).
In the preparation of the IFRS opening balance sheet, TMG adjusted the prior year’s amounts reported in the financial
statements, which were drawn up using the previously applied accounting standards (previous GAAP). A statement
of the effect of the transition from the previous GAAP to IFRS on the TMG financial position, financial results and
cash flows is explained in the following summaries and the notes to the summaries.
Reconciliation of the equity as at 1 January 2004
Effect of
Amounts in thousands of euros.
Notes*
Dutch GAAP
transition to IFRS
IFRS 1-1-2004
213,677
-5,400
208,277
132,446
-
132,446
41,015
Assets
Property, plant and equipment
a,b
Intangible assets
Investments in associates
Deferred tax credits
Other non-current financial assets
41,471
-456
i
-
8,095
8,095
b,g
85,267
15,011
100,278
472,861
17,250
490,111
b,e
20,598
489
21,087
3,570
-
3,570
a,b
107,605
2,269
109,874
Total non-current assets
Inventories
Other investments
Trade receivables and other receivables
Cash and cash equivalents
61,674
637
62,311
Total current assets
193,447
3,395
196,842
Total assets
666,308
20,645
686,953
* For the notes, please see page 98.
b
96
ANNUAL ACCOUNTS
2005
Effect of
Amounts in thousands of euros.
Notes
Dutch GAAP
transition to IFRS
IFRS 1-1-2004
13,125
-
13,125
114
-
114
415,094
-9,631
405,463
428,333
-9,631
418,702
Shareholders’ equity
Issued capital
Reserves
Retained earnings
j
Total equity to allocate to
Telegraaf Media Groep N.V.
Minority interest share
b
Total shareholders’ equity
885
302
1,187
429,218
-9,329
419,889
Liabilities
Interest-bearing loans and
other financing liabilities
b
-
596
596
Employee benefits
f
28,428
35,103
63,531
Provisions
f
25,965
9,129
35,094
Deferred tax liabilities
i
202
-202
-
54,595
44,626
99,221
Total non-current liabilities
Trade debts and other payables
b
25,225
480
25,705
Subscriptions paid in advance
b
34,869
-
34,869
Taxes and social security contributions
b
9,356
54
9,410
Accrued liabilities and deferred income
b
96,946
913
97,859
Provisions
f
16,100
-16,100
-
Total current liabilities
182,495
-14,652
167,843
Total liabilities
237,090
29,974
267,064
Total liabilities
666,308
20,645
686,953
ANNUAL ACCOUNTS
2005
97
Reconciliation of the equity as at 31 December 2004
Effect of
Amounts in thousands of euros.
Notes
Dutch GAAP transition to IFRS
IFRS 31-12-2004
Assets
Property, plant and equipment
a,b
Intangible assets
Investments in associates
Deferred tax credits
188,181
-6,305
181,876
138,838
10,014
148,852
43,645
336
43,981
i
-
4,965
4,965
b,g
88,710
44,288
132,998
459,374
53,298
512,672
13,784
588
14,372
6,475
-
6,475
a,b
111,487
799
112,286
b
90,902
366
91,268
Total current assets
222,648
1,753
224,401
Total assets
682,022
55,051
737,073
13,125
-
13,125
73
-
73
431,445
35,952
467,397
444,643
35,952
480,595
Other non-current financial assets
Total non-current assets
Inventories
b,e
Other investments
Trade receivables and other receivables
Cash and cash equivalents
Shareholders’ equity
Issued capital
Reserves
Retained earnings
j
Total equity to allocate to
Telegraaf Media Groep N.V.
Minority interest share
b
Total shareholders’ equity
-
473
473
444,643
36,425
481,068
Liabilities
Interest-bearing loans and
other financing liabilities
b
575
600
1,175
Employee benefits
f
27,082
26,020
53,102
Provisions
f
27,495
8,422
35,917
Deferred tax liabilities
i
793
Total non-current liabilities
55,945
-793
34,249
90,194
98
ANNUAL ACCOUNTS
2005
Effect of
Notes
Dutch GAAP
transition to IFRS
IFRS 31-12-2004
Trade debts and other payables
b
23,781
17
23,798
Subscriptions paid in advance
b
54,770
16
54,786
Taxes and social security contributions
b
9,162
22
9,184
Accrued liabilities and deferred income
b
93,721
-15,678
78,043
Total current liabilities
181,434
-15,623
165,811
Total liabilities
237,379
18,626
256,005
Total liabilities
682,022
55,051
737,073
Amounts in thousands of euros.
Notes to the reconciliation of the equity
The effects of the following restatements on the deferred taxes are explained under (f).
(a) On the basis of the previous GAAP, the purchased leasehold on the grounds of the premises in Amsterdam is
presented under land and buildings as part of the property, plant and equipment. On the basis of IFRS, the
purchased leasehold is considered to be a prepaid operational lease, and as such is presented under non-current
assets as ‘other non-current financial assets’.
(b) Both under the previous GAAP and under IFRS, there is the option of incorporating joint ventures in the consolidated financial statements by means of proportional consolidation, or not to consolidate and value the
interest as an associate. Under the previous GAAP, the Group did not consolidate joint ventures. In IFRS,
proportional consolidation is stated as an acceptable method. The Group uses this method. The effects of this
adjusted working method are limited to a reclassification of 1,529 as at 1 January 2004 from Investments in associates and a reclassification of € 2,494 as at 31 December 2004. This restatement has no effect on equity or result.
(c) The Group has applied IFRS 3 to all business combinations that have occurred since 1 January 2004 (the transition
to IFRS). The Group has chosen not to apply IFRS retroactively on business combinations that occurred before
the transition date to IFRS.
(d) On the basis of IFRS, goodwill will no longer be amortised, but it is annually reviewed for impairment commencing
from 1 January 2004. As result of this restatement, the amortisation of goodwill concerning the 2005 financial
year has been reversed for an amount of 8,709 (presented as a component of Depreciation of property, plant
and equipment and amortisation of intangible assets).
ANNUAL ACCOUNTS
2005
99
(e) Both under the previous GAAP and under IFRS, the Group’s share in the overall result of associates is presented
according to the equity method, under application of the parent company’s principles for measurement an
determination of the result. With respect to the participating interest SBS Broadcasting B.V. a restatement has
been made, with which the amortisation of goodwill in 2004 is reversed for an amount of 3,198, in accordance
with the restatement which has been introduced under (c) for the Group’s amortisation of goodwill. Moreover,
by virtue of the application of IAS 8, an adjustment of -2,555 was made in the balance sheet as at 1 January
2004, that relates to the treatment of tax deferrals by SBS Broadcasting B.V. Under the previous GAAP, this
adjustment was charged to the result for 2004.
(f) On the basis of the previous GAAP, the cost of inventories was measured using the `last in, last out’ method
(LIFO). As a result of the transition to IFRS, the Group now uses the principle by which the cost is determined
using the ‘first in, first out’ method (FIFO). The effects are an increase by 477 for inventories as at 1 January
2004 and by 573 as at 31 December 2004, and a decrease of 96 in the costs of Raw materials and consumables
for the 2004 financial year.
(g) There are a number of employee benefits with a long-term effect, which qualify as defined benefit pension schemes
under IFRS and so have an effect on the consolidated shareholders’ equity and result. The most important are
three pension schemes, the WAO (state old age pension scheme) and early retirement top-up schemes, and
restructuring provisions. In accordance with IFRS 1, the cumulative actuarial gains and losses that existed on
1 January for all defined benefit pension schemes are incorporated. This results in an increase of the provisions
by 28,132 (including the reclassified current portion) as at 1 January 2004 and of 19,706 as at 31 December 2004.
For the determination of the impact of these valuations on the income statement, the so-called corridor approach
is applied. Through this, only changes in the capital deficit that are more than 10% of the largest of the items
for assets and pension commitments, will be taken into consideration. In addition, and in accordance with the
guideline, these will be amortised over the average remaining period of employment, in this case 11.25 years.
(h) According to the previous GAAP, the Group recognised shares available for sale and similar instruments at cost.
In accordance with IFRS, such financial instruments should be recognised at fair value, in which changes of the
fair value are accounted for in the Fair value reserve of the shareholders’ equity. In addition, by designation,
there can be measurement at fair value, in which the changes in the fair value are recognised in the result.
The effect is an increase of other investments by 12,282 as at 1 January 2004, and 39,994 as at 31 December 2004,
which produces a positive effect of 27,712 to the benefit of the result for 2004.
(i) Non-current receivables and liabilities are recognised at amortised cost price. The effect of this was zero.
(j) The changes above have led to the following increase respectively decrease (-) of the deferred tax credit, calculated
at a tax rate of 30%.
100
ANNUAL ACCOUNTS
2005
Taxes
Amounts in thousands of euros.
31-12-2004
01-01-2004
18
-
Inventories
-172
-143
Provisions
5,912
8,440
Increase in deferred tax credits
5,758
8,297
Other (=balance)
The effect on the income statement for 2004 was an increase of 2,557 on the previously reported tax liability.
(k) The effect of the changes above on the retained earnings is as follows:
Shareholders’ equity
Amounts in thousands of euros.
31-12-2004
01-01-2004
Non-current intangible assets
8,709
-
Investments in associates
3,893
-2,555
27,017
12,282
Other investments
Inventories
Provisions
96
477
8,426
-28,132
Deferred taxes
-2,557
8,297
Total restatement of retained earnings
45,584
-9,631
On balance, the effect on the shareholders’ equity in 2004 is 35,952.
ANNUAL ACCOUNTS
2005
101
Reconciliation of the profit for 2004
Effect of
Amounts in thousands of euros.
Notes
Dutch GAAP transition to IFRS
IFRS
Net turnover
b
686,853
7,467
Other operating revenue
b
-
1,949
1,949
686,853
9,416
696,269
Total operating revenues
Raw materials and consumables
694,320
e
74,213
-96
74,117
b, f
206,306
847
207,153
51,028
-9,279
41,749
b, c, d
46,491
-6,614
39,877
b, f
301,490
5,579
307,069
679,528
-9,563
669,965
7,325
18,979
26,304
19,917
-12,720
7,197
3,034
1,366
4,400
-1,000
27,712
26,712
-
13,217
13,217
Balance of financial income and expenses
21,951
29,575
51,526
Pre-tax profit
29,276
48,554
77,830
Wages, salaries and social security charges
Social insurance and pension charges
Depreciation of property, plant and equipment
and amortisation of intangible assets
Other operating costs
Total operating costs
Operating result
Share in results of associates
b, g
Net financing result
Revaluation of non-current financial assets
Other financial income and expenses
Corporation tax
Net result
i
-7,510
-2,539
-10,049
21,766
46,015
67,781
22,125
45,584
67,709
Allocated to:
Shareholders of Telegraaf Media Groep N.V.
Minority interest share
-359
431
72
Net result
21,766
46,015
67,781
Ordinary and diluted profit per share (EUR)
€ 0.42
€ 0.87
€ 1.29
102
ANNUAL ACCOUNTS
2005
Explanation of changes in the cash flow statement for 2004
The changes in the cash flow statement for 2004 are not material and relate to proportional consolidation applied
under IFRS.
ANNUAL ACCOUNTS
2005
103
separate income statement
Amounts in thousands of euros.
Notes
Net result from subsidiaries
Other net income and expenditure
Result after taxes
2
2005
2004
32,425
47,796
33,003
19,913
65,428
67,709
104
ANNUAL ACCOUNTS
2005
separate balance sheet
Amounts in thousands of euros.
Notes
31-12-2005
31-12-2004
2,689
37
499,740
459,112
non-current assets
Non-current intangible assets
Goodwill
Non-current financial assets
Holdings in Group entities
3
29,263
40,743
Deferred tax credits
-
7,271
Other receivables
-
4,850
Total non-current financial assets
529,003
511,976
Total non-current assets
531,692
512,013
29,590
25,633
Other holdings
current assets
Receivables
Taxes and social
security contributions
Other receivables
4,889
135
Prepayments and accrued income
1,270
1,060
Cash and cash equivalents
Total current assets
Total assets
-
9,655
35,749
36,483
567,441
548,496
ANNUAL ACCOUNTS
2005
105
31-12-2005
31-12-2004
Issued capital
13,125
13,125
Legal reserves
1,893
1,732
450,022
398,029
Amounts in thousands of euros.
Notes
shareholders’ equity
Other reserves
65,428
67,709
1,4
530,468
480,595
Pension provision
5
16,912
52,000
Restructuring provision
5
4,562
8,958
Deferred tax liabilities
5
9,308
-
30,782
60,958
Retained earnings
Total shareholders’ equity
provisions
Total provisions
current liabilities
Credit institutions
4,372
-
Trade debts and other payables
1,819
6,943
Total current liabilities
6,191
6,943
36,973
67,901
567,441
548,496
Total liabilities
Total equity and liabilities
ANNUAL ACCOUNTS
2005
107
notes to the separate financial
statements
contents
page
109
112
113
115
116
116
117
Notes
1. Summary of effect of accounting
policies’ change on balance sheet
2. Summary of effect of accounting
policies’ change on income statement
3. Financial fixed assets
4. Shareholders’ equity
5. Provisions
6. Off-balance sheet commitments
7. Remuneration of Managing Board
and Supervisory Board members
108
ANNUAL ACCOUNTS
2005
significant accounting policies
General
The company financial statements have been
drawn up in accordance with legal provisions
concerning financial statements as included in
Part 9 Book 2 of the Netherlands Civil Code.
The policies used for valuation and determining
the result are the same as those used in the
consolidated accounts.
With regard to the separate income statement
of Telegraaf Media Groep N.V., use had been
made of the exemption under section 402 in
Book 2 of the Netherlands Civil Code.
For the general accounting policies as well as
for the policies for valuation and result determination, see the notes to the consolidated
financial statements. Group companies are
valued at their net asset value.
Change in accounting policies
As a result of applying the valuation policies
used in the consolidated financial statements
in its separate financial statements, Telegraaf
Media Groep N.V. has changed its accounting
policies. This change in the accounting policies
results from making use of the option under
Section 2: 362 (8) of the Netherlands Civil Code.
The use of this option means that it is still
possible to reconcile the consolidated equity
and the company’s separate equity. The separate
financial statements for the company were
previously drawn up using the accounting
policies for the valuation of assets and liabilities
and for determining the result stipulated in
Part 9, Book 2 of the Netherlands Civil Code.
The change in the policies of valuation, which
have been made retrospective, has influenced
the equity and the result. The impact on the
equity as at 1 January 2004 and 31 December
2004 is 9,631. The impact on the result for 2004
is 45,584.
For purposes of comparability, the comparative
figures have been restated using the newly
adopted valuation policies. For further information see section 35 of the notes, which
explains the transition to IFRS 1.
The reconciliation tables for the separate
company balance sheet and income statement, in which the effects of the change in the
accounting system are set out for each item of
the financial statements, are included under
sections 36 and 37. In addition, the principle of
economic reality has been applied in classifying
financial instruments for the determination of
the company equity because this principle has
been applied in the consolidated financial
statements compiled in accordance with International Financial Reporting Standards (IFRS)
drawn up by the International Accounting
Standards Board (IASB) and approved by the
European Commission, and the interpretations
of these standards by the IASB. Previously, the
classification of components of the equity was
based on the legal form of the financial
instrument. The corresponding change in the
presentation of accounts has been carried
through in the equity and is also presented
separately in the reconciliation table.
ANNUAL ACCOUNTS
2005
109
1. summary of effect of accounting policies’ change on balance sheet
Balance sheet as at 1-1-2005
Effect of
Amounts in thousands of euros.
Notes
Dutch GAAP
transition to IFRS
IFRS 1-1-2005
Non-current assets
a
-
37
37
b,c,d,g
450,904
61,072
511,976
450,904
61,109
512,013
24,837
1,991
26,828
9,655
-
9,655
34,492
1,991
36,483
485,396
63,100
548,496
Issued capital
13,125
-
13,125
Legal reserves
1,732
-
1,732
407,660
-9,631
398,029
22,125
45,584
67,709
444,643
35,953
480,595
32,031
28,927
60,958
Intangible assets
Non-current financial assets
Total non-current assets
Current assets
Receivables
g
Cash and cash equivalents
Total current assets
Total assets
Shareholders’ equity
Other reserves
f
Retained earnings
Total shareholders’ equity
Liabilities
Provisions
e,g
Short-term liabilities
e,g
Total liabilities
Total equity and liabilities
8,722
-1,780
6,942
40,753
27,147
67,900
485,396
63,100
548,496
110
ANNUAL ACCOUNTS
2005
Balance sheet as at 1-1-2004
Effect of
Amounts in thousands of euros.
Notes
Dutch GAAP transition to IFRS
IFRS 1-1-2004
Non-current assets
Intangible assets
a
37
-
37
b,c
483,343
21,031
504,374
483,380
21,031
504,411
32,001
-
32,001
103
-
103
32,104
-
32,104
515,484
21,031
536,515
Issued capital
13,125
-
13,125
Legal reserves
115
-
115
440,858
-9,631
431,227
Retained earnings
-25,765
-
-25,765
Total shareholders’ equity
428,333
-9,631
418,702
Non-current financial assets
Non-current financial assets
Current assets
Receivables
Cash and cash equivalents
Total current assets
Total assets
Shareholders’ equity
Other reserves
e
Liabilities
Provisions
d
35,241
42,078
77,319
Current liabilities
d
51,909
-11,415
40,494
87,150
30,663
117,813
515,484
21,032
536,515
Total liabilities
Total equity and liabilities
ANNUAL ACCOUNTS
2005
111
Shareholders’ equity
Amounts in thousands of euros.
31-12-2004
37
-
59,531
21,032
-23,615
-30,663
35,953
-9,631
Non-current intangible assets
Non-current financial assets
Provisions
Total restatement of shareholders’ equity
1-1-2004
Notes to the changes of accounting policies on the balance sheet
The reconciliation with the equity as at 1 January 2005 (1 January 2004) can be specified as follows:
(a) The amortisation of goodwill of 37 in 2004 is reversed.
(b) The valuation of group companies increases by 50,922 (15,492) because of IFRS effects at subsidiaries:
- the restatement of the valuation of the share in Wegener by 27,017 (12,282).
- reversing the amortisation of goodwill of 8,672.
- amortisation of restructuring provisions at subsidiaries of -355 (2,733).
- upwards revaluation of the paper inventories by 573 (477).
(c) The valuation of minority holding increases by 1,338 (- 2,555) due to:
- 643 (-2,555) the restatement of the value of the interest in SBS Broadcasting B.V., in connection with the
recognition of tax deferrals and the reversal of the amortisation of goodwill (2004 financial year). Under the
previous GAAP, this adjustment for the tax deferrals was charged to the result for 2004.
- 695 upward revaluation of the interest in ANP Holding B.V. to fair value.
(d) The deferred tax asset increases by 7,270 (8,095) as a result of the restatement in the equity. his also has an
effect of 1,531 on the provisions (deferred tax liabilities).
(e) The value of provisions increases on balance by 22,084 (30,663) due to the application of IAS 19 for the
measurement of employee benefits.
(f) As at 1 January 2005, the adjustment as at 1 January 2004 carries forward to the opening equity.
(g) With respect to the figures as at 31 December 2004, the 2004 financial statements contain reclassifications of
current liabilities to non-current financial assets of 3,072, from non-current financial assets to other receivables
and liabilities of 1,992 and to provisions (deferred tax liabilities) of 1,531.
112
ANNUAL ACCOUNTS
2005
2. summary of effect of accounting policies’ change on income statement
The summary below shows the effect of the changed accounting policies on the separate income statement for the
2004 financial year:
Income statement
Effect of
Amounts in thousands of euros.
Notes
Dutch GAAP
transition to IFRS
IFRS 2005
47,796
Net result of holdings
a
9,168
38,628
Other net income and expenditure
b
12,957
6,956
19,913
22,125
45,584
67,709
Net result
Notes to the effect of the change of accounting policies on the income statement.
The reconciliation of the net result for the financial year can be specified as follows:
(a) The net result of subsidiaries increases by 38,628 due to IFRS effects at subsidiaries:
- the restatement of the valuation of the share in Wegener by 27,017
- reversing the amortisation of goodwill of 8,672
- amortisation of restructuring provisions at subsidiaries by -355
- reduction of the paper costs by 96
- reversal of the goodwill with SBS Broadcasting B.V. of 3,198
(b) Other net income and expenses increase by 6,956 due to:
- decrease in pension costs by 9,396 due to IAS 19 valuation of employee benefits
- -615 result of amortisation of restructuring provisions
- upward revaluation of ANP by 695
- increasing tax burden by 2,556
- reversal of amortisation of goodwill by 36
ANNUAL ACCOUNTS
2005
113
3. non-current financial assets
2005
Amounts in thousands of euros.
2004
Holdings in group companies
Visible assets
Balance of receivables and liabilities
73,728
69,950
426,012
389,162
499,740
459,112
21,426
-
Other holdings
Expomedia Plc.
Media Librium B.V.
ANP Holding B.V.
SBS Broadcasting B.V.
7,059
-
778
778
-
39,965
29,263
40,743
Deferred tax credits
-
7,271
Other receivables
-
4,850
529,003
511,976
Total non-current financial assets
Movements in non-current financial assets can be shown as follows:
Amounts in thousands of euros.
Book value as at 31-12-2004
Group
Other
Deferred
Other
companies
holdings
vordering
receivables
Total
459,112
40,743
7,271
4,850
511,976
Changes in the book value
Investments
-
44,600
-
207
44,807
Divestments during current financial year
-
-65,911
-
-205
-66,116
38,899
-
-7,271
-4,852
26,776
-
-50
-
-
-50
22,544
9,881
-
-
32,425
-21,010
-
-
-
-21,010
195
-
-
-
195
499,740
29,263
-
-
529,003
Other changes
Write-downs
Share in the results of participating interests
Dividends received from participating interests
Exchange rate differences
Book value as at 31-12-2005
114
ANNUAL ACCOUNTS
2005
Holdings in group companies
Telegraaf Media Management B.V.
Amsterdam
Uitgeversmaatschappij De Limburger B.V.
Telegraaf Finance B.V.
Amsterdam
Regionale Televisie Limburg B.V.
Maastricht
Telegraaf Media International B.V.
Amsterdam
Limburgse Dagbladen Combinatie B.V.
Maastricht
Telegraaf Media Cyprus Ltd.
Cyprus
B.V. Het land van Weert
Vitalhold Ltd.
Cyprus
Drukkerij uitgeverij het land
Baragold Ltd.
Cyprus
van Valkenburg B.V.
Telegraaf Media Ukraine LLC
Kiev
Maas en Geleenbode B.V.
Publishing House Telegraaf Mag.Ukraine
Kiev
Maas en Mijn B.V.
Telegraaf Media Estonia Ö.U. (i.o.)
Tallinn
Maastricht
Weert
Valkenburg-Houthem
Geleen
Sittard
Eolus B.V.
Heerlen
Haarlem
Uitgeversmaatschappij De Telegraaf B.V.
Amsterdam
Hollandse Dagbladcombinatie B.V.
Twickel B.V.
Amsterdam
HDC Media B.V.
Classified Media B.V.
Amsterdam
Drukkerij Stuurman B.V.
Speurders.nl B.V.
Amsterdam
Offsetrotatie Schagen B.V.
Vacaturekrant.nl B.V.
Amsterdam
Uitgeversmaatschappij Midden
Bohil Media B.V.
Amsterdam
Noordholland B.V.
De Telegraaf Tijdschriften Groep B.V.
Amsterdam
Grafische Bedrijven Damiate B.V.
Haarlem
Zaandam
Schagen
Zaandam
Haarlem
TTG Sverige AB
Stockholm
Goois Weekblad B.V.
Hilversum
Telegraaf Media Sverige AB
Stockholm
Holland Combinatie B.V.
Amsterdam
TTG Participaties B.V.
Amsterdam
DistriQ B.V.
Amsterdam
Telegraaf Drukkerij Groep B.V.
Amsterdam
Telegraaf Distri B.V.
Amsterdam
B.V. Rotatiedrukkerij Voorburgwal
Amsterdam
Regio Distri B.V.
Amsterdam
Datawire B.V.
Amsterdam
B.V. Drukkerij Noordholland
Grafisch Bedrijf Media Groep Limburg B.V.
Hoorn
Heerlen
DWC B.V.
Roermond
Telegraaf Media ICT B.V.
Amsterdam
Paypernews Beheer B.V.
Amsterdam
Telegraaf Media Vastgoed B.V.
Amsterdam
Telegraaf Events B.V.
Amsterdam
B.V. Beleggingsmaatschappij Voorburgwal
Amsterdam
Media Groep West B.V.
Amsterdam
B.V. Agentenadministratiekantoor ’t Gooi
Hilversum
Mobillion B.V.
Amsterdam
Basismedia B.V.
Uitgeversmaatschappij De Trompetter B.V.
Amsterdam
Roermond
Sugababes.nl B.V.
Bibop TV International S.à.r.l.
Ede
Luxembourg
De Kempen Pers B.V.
Hapert
Mobillion GmbH
Bongers Beheer B.V.
Kelpen
Media Groep West International B.V.
Bongers Drukkerij B.V.
Kelpen
Franken Beleggingsmaatschappij B.V.
Bongers Media Productie B.V.
Kelpen
Adwire B.V.
Amsterdam
Kelpen
Telegraaf Telemol B.V.
Amsterdam
De Informatiefabriek B.V.
Media Groep Limburg B.V.
Heerlen
Exploitatiemaatschappij G en E
Uitgeversmij Limburgs Dagblad B.V.
Heerlen
Vastgoed B.V.
Munich
Amsterdam
Deventer
Hilversum
ANNUAL ACCOUNTS
2005
115
4. shareholders’ equity
Amounts in thousands of euros.
31-12-2005
31-12-2004
13,125
13,125
Issued capital
The authorised capital amounts to € 50,000,000
and is divided into shares of € 0.25 nominal value.
Issued: Ordinary shares (including € 240 in priority shares)
Legal reserves
Position as at start of financial year
Plus/minus: - Re. capitalised (amortised) development costs
Plus/minus: - Exchange differences
Position as at end of financial year
1,732
114
-34
1,658
195
-40
1,893
1,732
465,738
405,462
34
-1,658
Overige reserves
Position at start of financial year
Plus/minus: - To legal reserve
- Dividend 2004
Position as at end of financial year
-15,750
-5,775
450,022
398,029
65,428
67,709
530,468
480,595
Retained earnings
Result of the financial year
Total shareholders’ equity at year-end
Share capital and share premium
As at 31 December 2005, the authorised share capital consisted of 200,000,000 ordinary shares and priority shares
(2004: 200,000,000), which were issued and paid up as follows:
2005
In thousands of shares.
Issued as at 1 January
Issued and paid up in cash
Issued as at 31 December (paid up)
2004
Ordinary
Priority
Ordinary
Priority
shares
shares
shares
shares
52,499,200
960
52,499,200
960
-
-
-
-
52,499,200
960
52,499,200
960
116
ANNUAL ACCOUNTS
2005
All shares have a nominal value of € 0.25. As at 31 December 2005, no preference shares had been issued.
An overview of the legal and articles of association provisions concerning the distribution of profits and the other rights
under the articles of association connected with the ordinary shares, priority shares and preference shares is included
under Other Information on pages 121 to 123.
Reserve for currency translation differences
The reserve for currency conversion differences comprises all exchange differences for foreign currencies that arise
as the result of currency translations in the financial statements of company activities in Sweden and the Ukraine
which are no longer an integral part of the Company’s activities.
Reserve for holdings
The reserve for holdings comprises the reserve for capitalised development costs relating to capitalised software that
has been developed in-house (see also note 11 in the notes to the consolidated financial statements).
Effect of the change in the accounting policies
An overview of the effects of the change in the accounting policies is included in note 1 to the separate financial
statements above, ‘Summary of effect of accounting policies’ change on balance sheet’.
5. provisions
For notes to the provisions please refer to the notes to the consolidated balance sheet.
6. off-balance sheet commitments
Joint and several liability and guarantees
The company has accepted liability on the basis of section 403:1 (f) of Book 2 of the Netherlands Civil Code, for
liabilities resulting from legal transaction of consolidated subsidiary companies mentioned in note 3 (Non-current
financial assets), with the exceptions of Telegraaf Media Cyprus Ltd, Vitalhold Ltd, Telegraaf Media Ukraine LLC,
Publishing House Telegraaf Magazines Ukraine, TTG Sverig A.B., TTG Participaties B.V., De Informatiefabric B.V.,
Telegraaf Events B.V. and Mobillion GmbH.
In the case of partnerships with third parties, established in the legal form of a commercial partnership (vennootschap onder firma), the Group’s companies that participate in the partnership are jointly and severally liable for all
debts of the partnership.
ANNUAL ACCOUNTS
2005
117
Tax entity
Telegraaf Media Groep, along with nearly all of its wholly-owned subsidiaries in the Netherlands, is a single tax
entity for both corporation tax and turnover tax. Within the tax entity, the companies in the Group are mutually
jointly and severally liable for tax liabilities to the tax authorities.
7. remuneration of executive board and supervisory board members
Remuneration of present and former members of the Executive Board
2005
Amounts in euros.
2004
Regular
Deferred
Regular
Deferred
remuneration
remuneration
remuneration
remuneration
A.J. Swartjes
495,397
46,000
469,568
33,000
F.Th.J. Arp RA
485,713
19,000
469,568
13,000
Olde Kalter
471,214
84,000
469,568
59,000
441,317
1,512,000
469,568
13,000
Members of the Board
Former Board members
W.O. Kok*
Remuneration of present and former members of the Supervisory Board
2005
Amounts in euros.
2004
Regular
Deferred
Regular
Deferred
remuneration
remuneration
remuneration
remuneration
A.J. van Puijenbroek
23,370
-
23,370
-
Mrs M. Tiemstra
19,966
-
19,966
-
Prof W. van Voorden
19,966
-
19,966
-
-
70,000
-
49,000
19,966
-
19,966
-
6,655
-
19,966
-
-
-
4,992
-
Supervisory Directors
L.G. van Aken
H.L. Weenen
Former Supervisory Directors
W.H. Charles**
W. Overmars
* Left company with effect from 31 August 2005.
** Resigned supervisory directorship with effect from 20 April 2005.
118
ANNUAL ACCOUNTS
2005
The general meeting of shareholders on 20 April 2005 approved the proposed remuneration policy for the Executive
Board. The remuneration structure consists of fixed and variable elements. The fixed element is the annual salary
and holiday pay. The variable element consists of a) the existing profit-sharing scheme for all employees of Telegraaf
Media Groep N.V. and b) an individual bonus. The individual bonus varies between 0 and 2 month’s salary and is
allocated on the basis of previously determined criteria and objectives.
Shares owned as at 31 December 2005:
Depository
Shares receipts for shares
Members of the Executive Board
A.J. Swartjes
-
-
F.Th.J. Arp RA
-
583
11
-
J. Olde Kalter
Members of the Supervisory Board
51
-
H.L. Weenen
A.J. van Puijenbroek
-
5,200
Prof. W. van Voorden
-
-
Mrs M. Tiemstra
-
-
11
-
L.G. van Aken
Executive Board
Supervisory Board
A.J. Swartjes, chairman
A.J. van Puijenbroek, chairman
F.Th.J. Arp RA
Prof W. van Voorden
J. Olde Kalter
H.L. Weenen
Mrs. M. Tiemstra
L.G. van Aken
Amsterdam, 15 March 2006
OTHER DATA
2005
119
auditors’ report
introduction
We have audited the financial statements of
Telegraaf Media Groep N.V., Amsterdam, for the
year 2005 as set out on pages 47 to 118. These
financial statements consist of the consolidated
financial statements and the company financial
statements. These financial statements are the
responsibility of the management of Telegraaf
Media Groep N.V. Our responsibility is to
express an opinion on these financial statements
based on our audit.
scope
We conducted our audit in accordance with
auditing standards generally accepted in the
Netherlands. Those standards require that we
plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material misstatement.
An audit includes examining, on a test basis,
evidence supporting the amounts and
disclosures in the financial statements. An
audit also includes assessing the accounting
principles used and significant estimates made
by management, as well as evaluating the
overall presentation of the financial statements.
We believe that our audit provides a reasonable
basis for our 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 the company as at December 31,
2005 and of the result and the cash flows for
the year then ended in accordance with the
International Financial Reporting Standards as
adopted by the EU and also comply with the
financial reporting requirements included in
Part 9 of Book 2 of the Netherlands Civil Code
as far as applicable.
Furthermore, we have established to the extent
of our competence that the annual report is
consistent with the consolidated financial
statements.
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 the company as at 31 December
2005 and of the result for the year then ended
in accordance with accounting principles as
generally accepted in the Netherlands and also
comply with the financial reporting requirements
included in Part 9 of Book 2 of the Netherlands
Civil Code. Furthermore, we have established
to the extent of our competence that the
annual report is consistent with the company
financial statements.
Amsterdam, 15 March 2006
Deloitte Accountants B.V.
Drs P. Kuijpers RA
OTHER DATA
2005
121
provisions in the articles
of association concerning
the appropriation of profit
Pursuant to article 33 of the articles of association
of Telegraaf Media Groep N.V., the following
rules apply to the appropriation of profit:
distributable portion of shareholders’ equity.
The dividend is calculated on the paid-up portion
of the nominal amount.
• Subject to the approval of the Supervisory
Board and Stichting Beheer van Prioriteitsaandelen Telegraaf Media Groep N.V., the Executive
Board shall decide every year what percentage
of the profit - the positive balance of the profit
and loss account - is to be added to the
reserves.
• The remaining profit shall be at the disposal of
the General Meeting provided that no further
dividend is to be distributed on priority shares
and preference shares.
• Out of the profits, after addition to the
reserves in accordance with the preceding paragraph, a dividend shall be paid on the amount
paid in on the preference shares, the percentage of which shall be equal to the average yield
of Dutch medium-term government bonds as at
the beginning of the financial year to which the
payment relates, increased by one per cent.
The average yield is determined by the Executive
Board subject to approval by the Supervisory
Board.
• A primary dividend amounting to five per
cent of the nominal amount of their shares or
- if the profit is not sufficient for this - as high a
percentage as possible, is then paid out to the
holders of ordinary shares and priority shares.
Where it concerns priority shares, the percentage of the above-mentioned dividend may not
exceed the percentage of the legal interest rate
prevailing on the last day of the financial year in
question.
• If the distribution of dividend on preference
shares, as referred to in paragraph 2, cannot be
effected or not in full because the profit is not
sufficient, the deficit shall be paid out of the
• Profit distributions may not exceed the
amount of the distributable portion of shareholders’ equity.
• If there is a loss incurred for any year, no
dividend will be distributed for that year. No
dividend may be paid in subsequent years until
the loss has been fully compensated for by the
profit. However, at the proposal of the priority
shareholders, the general meeting may resolve
to recover such loss by a charge to the distributable portion of shareholders’ equity or also
to distribute a dividend that is charged to the
distributable portion of shareholders’ equity.
•
Distribution of profit is effected following
adoption of the annual accounts showing that
such distribution is permitted.
• In determining the profit distribution, the
shares the company holds in its capital are not
included in the calculation.
122
OTHER DATA
2005
stichting beheer van prioriteitsaandelen telegraaf media groep n.v.
The priority shares are held by the Stichting
Beheer van Prioriteitsaandelen Telegraaf Media
Groep N.V. (TMG priority share management
trust), the Board of which as at 31 December
2005 consisted of Messrs A.J. van Puijenbroek,
chairman, L.G. van Aken, E.F.M. Kok, and E.H.
van Puijenbroek.
The goal of the trust is to acquire and manage
the priority shares in the company and, among
other things, to ensure continuity in the
management of the company, to defend against
influences on the management that could
prejudice the company’s independence and
would be contrary to the company’s interests,
and to further a good policy in the company’s
interests.
The powers attached to the priority shares
include the right to decide to issue shares, of
fixing the number of Executive Board members,
and the right to propose an amendment to the
articles of association or dissolution of the
company prior to the General Meeting of
Shareholders being able to decide these issues.
statement of independence
The Executive Board of Telegraaf Media Groep
N.V. and the Board of the Stichting Beheer van
Prioriteitsaandelen Telegraaf Media Groep N.V.
hereby declare that, in their joint opinion, the
requirements concerning the independence of
the Board of the Stichting Beheer van Prioriteitsaandelen Telegraaf Media Groep N.V., set out in
Appendix X to the Listing and Issuing Rules of
Amsterdam Exchanges N.V., Amsterdam, have
been fully met.
Executive Board,
Telegraaf Media Groep N.V.
Board of the Stichting Beheer
van Prioriteitsaandelen
Telegraaf Media Groep N.V.
Amsterdam, March 2006.
OTHER DATA
2005
123
stichting preferente aandelen
telegraaf media groep n.v.
The goal of Stichting Preferente Aandelen
Telegraaf Media Groep N.V. (TMG preference
share trust) is:
• To look after the interests of the Telegraaf
Media Groep N.V. company, established in
Amsterdam, hereinafter called: ’the company’,
the companies associated with it and all those
involved, including by defending the company
as much as possible against influences that could
threaten its continuity, independence or identity
and would be contrary to these interests.
• Defending the company against influences of
third parties that could impair editorial independence, as well as the principles underlying
editorial policy concerning opinion-forming
publications of enterprises within the group.
The trust seeks to achieve this goal by acquiring
preference shares in the company and by exercising the rights attached to these shares. In doing
so, the trust takes into account the purpose for
which preference shares may be issued.
This goal does not include the sale, encumbrance or any other manner of having control
of shares except in case of:
•
Sale to the company itself or to a company
associated with it within the group and designated by the company.
• Collaboration in the repayment on and the
withdrawal of shares.
The right to issue preference shares of Telegraaf
Media Groep N.V. has been granted by the
Stichting Beheer van Prioriteitsaandelen
Telegraaf Media Groep N.V.
The Board consists of one chairman and four
members. The composition of the Board as at
31 December 2005 was: G.G. Witsen Elias
(Chairman), S.E. de Jong, A. den Bandt,
E.F.M. Kok, and A.J. van Puijenbroek.
On the balance sheet date, no preference
shares had been issued.
statement of independence
The Executive Board of Telegraaf Media Groep
N.V. and the Board of Stichting Preferente
Aandelen Telegraaf Media Groep N.V. hereby
declare that, in their joint opinion, the requirements concerning the independence of the
Board of the Stichting Preferente Aandelen
Telegraaf Media Groep N.V. set out in Appendix
X to the Listing and Issuing Rules of Amsterdam
Exchanges N.V., Amsterdam, have been fully met.
Executive Board,
Telegraaf Media Groep N.V.
Board of the Stichting Preferente
Aandelen Telegraaf Media Groep N.V.
Amsterdam, March 2006.
124
OTHER DATA
2005
publications and activities
of telegraaf media groep
(AS AT 31 DECEMBER 2005)
newspapers
CosmoGIRL!
www.elegance.nl
www.Fitclub.nl
FHM (For Him Magazine)
www. Jan-magazine.nl
www.Gametoday.nl
De Telegraaf
Elegance
www.habbohotel.nl
www.relatieplanet.nl
Sp!ts
Residence
www.chapeaumagazine.com
www.iwannadate.nl
Limburgs Dagblad
Hitkrant
Dagblad De Limburger
Autovisie
SWEDEN
Haarlems Dagblad
Starstyle
www.cosmopolitan.se
IJmuider Courant
Chapeau! (issued by MGL)
www.batnytt.se
Leidsch Dagblad
Nummer 1 (issued by MGL)
www.vibatagare.se
De Gooi- en Eemlander
AutoTelegraaf Occasion Mag.
www.golfdigest.se
Almere Vandaag
JAN
www.marinan.com
www.speurders.nl
www.vacaturekrant.nl
door-to-door
publications and
news journals
www.residenceonline.se
Noordhollands Dagblad
which includes:
SWEDEN
- Alkmaarsche Courant
Vi Båtägare
www.ttg.se
Regionally distributed with
- Schager Courant
Båtnytt
UKRAINE
!N
- Enkhuizer Courant
Golf Digest
www.whatson-kiev.com
- Dagblad voor West-Friesland
Residence
www.kyivcity.com
Greater Amsterdam
- Helderse Courant
Cosmopolitan
www.obzor-online.com
De Echo (11 editions)
- Dagblad Kennemerland
Allt om Kök och Bad
- Dagblad Zaanstreek
Cosmopolitan Style
De Telegraaf
Het Weekblad op Zondag
De Woongids
other internet
activities
Amstelveens Nieuwsblad
Panorama
www.DFT.nl
Amstelland/
Domus Design
www.autotelegraaf.nl
Haarlemmermeer
Maister
www.elcheapo.nl
Witte Weekblad
Gourmet Guide
www.teleweer.nl
Zondag Haarlemmermeer
Kiev City
www.woonkrant.nl
Obzor
www.reiskrant.nl
’t Gooi and surrounding
www.Limburgpersoneel.nl
area
www.Limburgopwielen.nl
De Gooi- en Eembode
www.spits.vacaturekrant.nl
Laarder Courant De Bel
THE NETHERLANDS
www.zorg.vacaturekrant.nl
Nieuwsblad voor Huizen
www.ttg.nl
www.limburgwonen.nl
Vecht-Journaal
www.autovisie.nl
www.autocircuit.nl
Baarns Weekblad
www.hitkrant.nl
www.woneninholland.nl
Woonbode
www.prive.nl
www.groeneweekblad.nl
Wijdemeren Journaal
magazines
www.fhm.nl
www.botentekoop.nl
HEBBUS
www.starstyle-magazine.nl
www.nieuwebotentekoop.nl
THE NETHERLANDS
Privé
Esquire
www.esquire.nl
www.campersencaravans.nl
Flevoland
www.cosmogirl.nl
www.nieuwecampers.nl
De Almare (3 editions)
www.residence.nl
www.nieuwecaravans.nl
Zondagochtendblad
- Dagblad Waterland
UKRAINE
internet
www.telegraaf.nl
www.spitsnet.nl
www.haarlemsdagblad.nl
www.ijmuidercourant.nl
www.leidschdagblad.nl
www.nhd.nl
www.gooieneemlander.nl
www.almerevandaag.nl
www.mgl.nl
www.limburgsdagblad.nl
www.limburger.nl
www.hdcmedia.nl
Het Weekend
What’s On
internet
OTHER DATA
Haarlem and surrounding
Alkmaar and
area
surrounding area
Nieuwsblad De Kennemer
internet
www.hollandcombinatie.nl
Haarlems Weekblad
Alkmaars Weekblad
www.trompetter.nl
Heemsteedse Courant
De Koerier
www.bongersmedia.nl
Nieuwsblad IJmuiden
De Duinstreek
www.alphen.cc
Nieuwsblad Santpoort
Nieuwsblad voor Castricum
www.woneninlimburg.nl
& Velserbroek
Zondagochtendblad
www.autoinformatief.nl
Zondag Haarlem
www.werken.inlimburg.nl
Noord-Holland-North
www.ondernemen.
Helders Weekblad
inlimburg.nl
Leiden and surrounding
Schager Weekblad
www.deregionaleuitwijzer.nl
area
CTR/De Polderbode
Zondag IJmuiden
HET op Zondag
Deze Maand
Witte Weekblad
Wieringer Courant
Het Magazine
Wieringermeerbode
Zondagochtendblad
- Telephone information
Noord-Brabant-East
- Participating interests in
The bulb-growing area
Witte Weekblad
other activities
services
De Trompetter (5 editions)
international commercial TV
Alphen a/d Rijn and
De Schakel
- Participations in exhibitions
surrounding area
Veldhovens Weekblad
- Teletext activities
Witte Weekblad
Oirschots Weekjournaal
- Participating interests in
Het Weekend
Kempener Koerier
Makelaars Vizier
De Kempenaer
- Digital distribution platform
Alphen.cc
De Hilverbode
- Printing
Nieuwsklok
- Logistics
narrowcasting
Zaanstreek/Purmerend
De Leije
De Zaankanter
Parel van Brabant
internet
Het Gezinsblad
Limburg
www.mediagroepwest.nl
Zondagochtendblad
De Trompetter (13 editions)
www.datawire.nl
Witte Weekblad voor
De Schakel
www.mobillion.nl
Edam/Volendam/
Wonen in Limburg
www.mobelle.nl
Waterland
Auto-informatief
www.sugababes.nl
Werken in Limburg
www.superdudes.nl
De Krommenieër
West-Friesland
Ondernemen in Limburg
Westfries Weekblad
De Regionale Uitwijzer
Enkhuizer Weekblad
Zondagochtendblad
2005
125
126
OTHER DATA
2005
participating interests
BasisMedia B.V.
Smart Events B.V.
(50%)
Telegraaf Media Ukraine
Telegraaf News Media LLC
(80%)
Telegraaf Events B.V.
Telegraaf Expomedia Events V.O.F.
(50%)
Mobillion
Sugababes.nl B.V.
(70%)
Bongers Media Productie -
Bibop TV International S.à.r.l.
(50%)
De Informatiefabriek B.V.
De Informatiefabriek V.O.F.
Telegraaf Media Groep N.V.
Expomedia Group Plc
SBS Broadcasting S.à.r.l.
(20%)
(20%)
Koninklijke Wegener N.V.
(26,24%)
ANP Holding B.V.
(8,84%)
Media Librium B.V.
(40%)
AM van Gaal Media B.V.
(20%)
Uitgeversmaatschappij De Telegraaf B.V.
RKK C.V./RKK Beheer B.V.
(25%)
Fitclub B.V.
(50%)
Adventure Holding B.V.
(14,3%)
Media Groep Limburg B.V.
Televisiebedrijf Limburg B.V./L1
(45%)
Omroepbedrijf Limburg B.V./L1
(40%)
De Nationale Regiopers C.V./NRp Beheer B.V.
Media Menu C.V./Media Menu Beheer B.V.
(11,8%)
(25%)
Hollandse Dagblad Combinatie
De Nationale Regiopers C.V./NRp Beheer B.V.
(14%)
Media Menu C.V./Media Menu Beheer B.V.
(25%)
De Telegraaf Tijdschriften Groep B.V.
TTG Hearst AB
(50%)
TTG Hearst B.V.
(75%)
TTG Sulake B.V.
(50%)
TTG Bloom V.O.F.
(80%)
DataWire B.V.
DataWireSport B.V.
(70%)
(30%)
OTHER DATA
statement of independence
The Managing Board of Telegraaf Media Groep
N.V. and the Board of the Stichting Administratiekantoor van aandelen Telegraaf Media Groep
N.V. (trust office for TMG shares) hereby declare
that, in their joint opinion, the requirements
concerning the independence of the Board of
the Stichting Administratiekantoor van aandelen
Telegraaf Media Groep N.V. set out in Appendix
X to the Listing and Issuing Rules of Amsterdam
Exchanges N.V., Amsterdam, have been
fully met.
Managing Board,
Telegraaf Media Groep N.V.
Board of the Stichting
Telegraaf Media Groep N.V.
Amsterdam, March 2006
2005
127
OTHER DATA
2005
129
management of subsidiaries
(AS AT 31 DECEMBER 2005 )
uitgeversmaatschappij
de telegraaf b.v.
Uitgeversmaatschappij
TTG Sverige AB
telegraaf events b.v.
Limburgs Dagblad B.V.
Mrs K. Neld
F. Th. J. Arp RA
A.J.M. Boerma
Uitgeversmaatschappij
TTG Participaties B.V.
Th.J.C. Trimbach
De Limburger B.V.
E.T. van den Brakel
telegraaf
media ict b.v.
P.C.J. Tuijnman
B. Brouwers
R. Mackloet
J. J. W. Janssen
Regionale televisie
Limburg B.V.
telegraaf media
international b.v.
telegraaf drukkerij
groep b.v.
J.H. Boermann
F.Th.J. Arp RA
R. van der Plasse
F. Blok
F. Volmer
Classified Media B.V.
Speurders.nl B.V.
H.J.J.M. Eijkenboom
A.J.M. Boerma
uitgeversmaatschappij
de trompetter b.v.
ESB, A.V. Husiak (a.i.)
Vacaturekrant.nl B.V.
A.C.P. Peters
Telegraaf Media Cyprus Ltd
P.C.J. Tuijnman
P.C.J. Tuijnman
A.J.M. Boerma
De Kempen Pers B.V.
A.C.P. Peters
Bohil Media B.V.
B.R.C. Hilberdink
(via Bohil Beheer B.V.)
basismedia b.v.
J.H.R. Eijkelenkamp
hollandse dagbladcombinatie b.v.
T.E. Klein
H. de Wit
Bongers Beheer B.V.
A.C.P. Peters
E.W.P.A. Bongers
V.G.M. Nijpels-Bongers
Bongers Drukkerij B.V.
Bongers Beheer B.V.
Bongers Beheer B.V.
T.E. Klein
De Informatiefabriek B.V.
Bongers Beheer B.V.
H. de Wit
B.V. Drukkerij Noordholland
J.R.Talsma
W.R. de la Motte
B.V. Rotatiedrukkerij
C. Michaelides
Voorburgwal
P. Papademetriou
F.C. van der Kooij
Vitalhold Ltd
Grafisch Bedrijf
C. Michaelides
Media Groep Limburg B.V.
P. Papademetriou
(Nieuwsdruk Limburg)
H.J.M.M. Eijkenboom
datawire b.v.
W. Kwak
F.T.M. Philippo
telegraaf
finance b.v.
F.Th.J. Arp RA
Bongers Media Productie B.V.
Bongers Media Productie HDC Media B.V.
Telegraaf Media Ukraine LLC
PayperNews Beheer B.V.
J. Olde Kalter
W. Kwak
A.J. Swartjes
F.T.M. Philippo
media groep
west b.v.
distriq b.v.
W.P. Delput
J.J.M. van der Veen
Telegraaf Media Groep N.V.
Exploitatiemaatschappij
holland
combinatie b.v.
G+E Vastgoed B.V.
R.D. Keller
Mobillion B.V.
F.Th.J. Arp RA
J. Looijenga
W.P. Delput
de telegraaf
tijdschriften
groep b.v.
Th.E.R.A. Kampschreur
J.J.M. van der Veen
Mobillion GmbH
Regio Distri B.V.
E.T. van den Brakel
R. van der Meijs
F.Th.J. Arp RA
HDC B.V.
media groep
limburg b.v.
J.H. Boermann
R. Mackloet
Telegraaf Distri B.V.
W.P. Delput
J.J.M. van der Veen
key figures as of balance sheet date
2005 *
2004 *
2003
2002
2001
2000
530,468
480,595
428,333
454,079
464,761
500,057
Shareholders' equity TMG as a percentage
of total assets
68.8%
65.2%
64.5%
62.5%
60.6%
61.6%
Current assets TMG:
short term liabilities
1.08:1
1.35 : 1
1.06 : 1
0.98 : 1
0.72 : 1
0.70 : 1
Shareholders' equity TMG:
borrowed capital
2.20:1
1.87 : 1
1.81 : 1
1.67 : 1
1.54 : 1
1.60 : 1
Net-turnover TMG x € 1,000
736,686
694,320
683,556
704,462
822,220
811,147
Cash flow from
operational activities x € 1,000
Net profit x € 1,000
73,600
65,428
66,306
67,709
62,172
-25,765
33,059
-4,913
74,992
-29,510
141,486
48,452
Net profit TMG as a percentage
of net turnover
8.9%
9.8%
-3.8%
–0.7%
–3.6%
6.0%
Operating profit as a percentage
of net turnover
7.2%
3.8%
3.5%
3.1%
1.2%
9.9%
170,632
4,362
159,463
4,316
153,298
4,357
150,205
4,553
151,561
5,393
156,690
5,457
12.3%
p.m.
14.1%
23.6%
-6.0%
p.m.
–1.1%
p.m.
–6.4%
p.m.
9.7%
41.3%
Shareholders' equity
Cash flow from operating activities
Net result
Dividend
10.10
1.40
1.25
p.m.
9.15
1.26
1.29
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
9.52
2.70
0.92
0.38
Price: low
Price: high
Closing rate of exchange as per 31 -12
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
20.80
37.00
21.60
Shareholders' equity x € 1,000**
Average net turnover
per employee (fte)
Work force at year-end (fte)
Renturn on shareholders' equity
Pay-out ratio
Per share TMG van € 0.25 par value
(rounded off to full eurocents)
* Op basis van IFRS
** Toe te rekenen aan Telegraaf Media Groep N.V.
1999
1998
1997
1996
471,529
430,079
386,903
348,299
63.2%
65.3%
65.7%
65.9%
1.44 : 1
1.55 : 1
1.48 : 1
1.58 : 1
MOVEMENTS EBIT
IN RELATION TO TURNOVER
in millions of euros
1.72 : 1
1.88 : 1
1.92 : 1
1.93 : 1
721,335
689,916
616,122
582,303
822
737
704
102,357
64,794
119,618
65,877
124,093
56,573
99,129
38,391
9.0%
9.5%
9.2%
6.6%
12.8%
12.8%
11.2%
2001
25
22
5
12.3%
694
684
2002
2003
2004
Turnover
53
26
2005
Ebit
Cijfers 2000 t/m 2003 zijn niet aangepast voor IFRS grondslagen.
153,922
4,756
151,018
4,619
141,625
4,384
141,035
4,125
13.7%
36.0%
15.3%
35.4%
14.6%
35.4%
11.0%
42.2%
8.98
1.95
1.23
0.44
8.19
2.28
1.26
0.44
7.37
2.36
1.08
0.38
6.63
1.89
0.73
0.31
16.88
24.69
22.00
17.47
23.82
22.91
16.34
22.01
17.33
12.84
19.24
16.51
INDEXED NUMBER OF EMPLOYEES
IN RELATION TO TURNOVER
100 100 100
86 86
2001*
Turnover
2002*
105
101
99
83
82
2003*
Average number of employees
84
113
90
80
80
2004
2005
Turnover per employee
Cijfers 2000 t/m 2003 zijn niet aangepast voor IFRS grondslagen.