Sanoma Corporation, Half-year Report, 24 July 2020 at 8:30 EET

Sanoma’s Half-year Report January–June 2020: Learning on track towards full year targets, advertising sales declined due to corona pandemic

This release is a summary of Sanoma’s Half-year Report January–June 2020. The complete report is attached to this release and is also available at

Q2 2020

  • The Group’s net sales declined to EUR 246 million (2019: 260). Net sales of Learning grew driven by the Iddink acquisition, while net sales of Media Finland declined driven by decreasing advertising sales due to the coronavirus pandemic. The Group’s comparable net sales development was ‑14% (2019: -1%).
  • Operational EBIT excl. PPA declined to EUR 54 million (2019: 60). In Learning, shifting of reported sales towards the third quarter had a negative impact on earnings. In Media Finland, the adverse earnings impact of lower advertising sales was partially offset by temporary cost savings related to TV and received insurance compensation related to the events business.
  • EBIT was EUR 42 million (2019: 54). Items affecting comparability (IACs) totalled EUR -6 million (2019: -4). PPA amortisations were EUR 6 million (2019: 2).
  • Operational EPS was EUR 0.20 (2019: 0.24) and EUR 0.22 (2019: 0.33) including discontinued operations.
  • EPS was EUR 0.17 (2019: 0.22) and EUR 0.20 (2019: 0.31) including discontinued operations.
  • On 16 July, Sanoma announced the divestment of Oikotie to Schibsted with an enterprise value of EUR 185 million.
  • On 30 April, Sanoma completed the acquisition of Alma Media’s regional news media business in Finland with an enterprise value of EUR 115 million. The acquisition was announced on 11 February 2020.
  • On 20 April, Sanoma completed the divestment of Sanoma Media Netherlands to DPG Media with an enterprise value of EUR 460 million.

H1 2020

  • The Group’s net sales grew to EUR 434 million (2019: 423) mainly as a result of the Iddink and itslearning acquisitions, while net sales development of Media Finland was adversely impacted by the coronavirus pandemic. The Group’s comparable net sales development was -8% (2019: -2%).
  • Operational EBIT excl. PPA declined to EUR 45 million (2019: 56). In Learning, the decline was mainly due to shifting of reported sales towards the third quarter and in Media Finland it was mainly due to lower advertising sales.
  • EBIT was EUR 25 million (2019: 43). IACs totalled EUR -10 million (2019: -9). PPA amortisations were EUR 11 million (2019: 4).
  • Operational EPS was EUR 0.14 (2019: 0.19) and EUR 0.23 (2019: 0.34) including discontinued operations.
  • EPS was EUR 0.09 (2019: 0.15) and EUR 0.18 (2019: 0.35) including discontinued operations.
  • On 24 March, Sanoma temporarily withdrew its Outlook for 2020 due to the coronavirus pandemic.

Outlook for 2020 (unchanged, temporarily withdrawn on 24 March)

On 24 March, Sanoma temporarily withdrew its Outlook for 2020, which was given on 7 February, due to the coronavirus pandemic. As the pandemic and its implications to Sanoma’s business continue to evolve notably, it is currently too early to make reliable and specific estimates for an adjusted Outlook. Sanoma expects to give an updated Outlook for 2020 later during the year.

Key impacts of the coronavirus pandemic

Sanoma estimates that the coronavirus pandemic will have significant impacts on its business during 2020. For its own part, the Group’s well-balanced business portfolio mitigates the impacts to a certain extent; after the acquisitions completed in Learning in 2019, and the divestments of Media Netherlands and the online classifieds business Oikotie in Finland, a majority of the Group’s operational earnings will come from Learning in 2020.

In Learning, no major impacts on net sales and profitability are currently expected due to the pandemic. In H1 2020, the coronavirus pandemic had only a minimal impact on the net sales and operational EBIT of Learning.

In Media Finland, subscription and other B2C sales represent more than half of the total net sales, which, apart from the events business, are not expected to be significantly affected by the pandemic unless the exceptional situation intensifies. In H1 2020, subscription sales of Media Finland grew slightly on a comparable basis, and by 7% including the acquired regional news media business with total subscription sales amounting to EUR 104 million (2019: 97).

On 22 April, the Finnish government decided to prohibit all large events until the end of July 2020. As a consequence, all Media Finland’s festivals and events for the summer season 2020 were cancelled. In H1 2020, net sales of the events business amounted to EUR 0.3 million (2019: 15) with a positive operational EBIT due to the insurance compensation received. The compensation was booked in full in Q2 2020, but it compensates both costs already incurred during the first half of the year and costs to be incurred during the second half. In 2019, net sales of the events business were approx. EUR 35 million and its operational EBIT margin was above the margin of the Media Finland SBU (12.0%).

Sanoma estimates that the coronavirus pandemic will have a material impact on the full year net sales and profitability of Media Finland’s B2B advertising business, although the impact may greatly vary between customer categories and media channels. The size of the impact is dependent on the duration of the crisis and the pace of the recovery as well as a possible second wave of the pandemic and its impacts on consumer and advertiser confidence and behaviour. Due to these uncertainties, it is currently too early to make reliable and specific estimates of the total impact, but the financial crisis in 2008-2009 could be considered as a reference for that. During the financial crisis, Sanoma’s advertising sales declined by approx. 17% year-on-year, in line with the market. In H1 2020, Media Finland’s advertising sales declined by 18% on a comparable basis, and by 15% including the acquired regional news media business, with total advertising sales amounting to EUR 107 million (2019: 127). Monthly advertising sales development of Media Finland during the pandemic, excluding the regional news media business, is summarised in the table below. During the second half of the year, advertising sales is expected to continue its gradual recovery.

Advertising sales development

 AprilMayJuneQ2 2020H1 2020
Sanoma Media Finland-36%-32%-22%-30%-18%
Overall advertising market in Finland 1)-43%-42%-28%-38%-24%

1) Source: Kantar TNS Finland

During the pandemic, Sanoma’s first priority has been ensuring the health and safety of its employees and providing solid support to its customers and business partners. Practically all teams shifted to remote operations at the start of the pandemic and have largely continued in the same mode throughout the second quarter. Remote work is largely supported by the improved, cloud-based IT infrastructure, in which Sanoma has made investments in recent years. Throughout its operations, Sanoma has followed the guidance and measures recommended by authorities in its operating countries.

Sanoma has actively and perseveringly taken actions to mitigate the risks related to the pandemic and continuously updated the risk situation and mitigation plans for employee safety and impact on the financial results. Cost mitigation actions have included careful cost containment of all non-mandatory cost categories and cost savings have been achieved e.g. in overall administration and travelling, marketing and content creation. Some IT expenses have increased slightly due to increased use of Sanoma’s digital services during the pandemic. During the pandemic, Sanoma has supported users of its digital learning platforms by opening up certain services free of charge and media consumers by e.g. offering all corona-related news free of charge at In Finland, Sanoma also initiated a specific “Anna sen soida” campaign to support the artists impacted by the cancellation of events this year, and donated EUR 350,000 reserved by the AGM for the Board of Directors to be used for charitable donations to the campaign.

At the end of June 2020, the Group has a solid financial position, supported by the divestment of Media Netherland and, after the end of the reporting period, the divestment of the online classifieds business Oikotie in Finland. Sanoma will have EUR 400 500 million headroom for future M&A, where its focus will be on further growing especially its learning business.

Key indicators for continuing operations

EUR millionQ2 2020Q2 2019ChangeH1 2020H1 2019Change FY 2019
Net sales246.2259.8-5%434.0422.83%913.3
Operational EBIT excl. PPA 1)53.560.1-11%45.155.6-19%135.2
  Margin 1)21.7%23.1% 10.4%13.2% 14.8%
Result for the period29.236.1-19%16.324.7-34%63.1
Operational EPS, EUR 2)0.200.24-16%0.140.19-28%0.49
EPS, EUR0.170.22-22%0.090.15-37%0.38
Average number of employees (FTE)   4,1683,42822%3,567
Number of employees at the end of the period (FTE)   4,475 


Key indicators incl. continuing and discontinued operations 3)

EUR millionQ2 2020Q2 2019ChangeH1 2020H1 2019Change FY 2019
Result for the period33.550.0-33%29.757.4-48%13.3
Free cash flow-4.90.1 -65.1-41.2-58%131.3
Equity ratio   34.4%37.2% 30.5%
Net debt   543.9578.0-6%794.7
Net debt / Adj. EBITDA   2.62.218%2.7
Operational EPS, EUR 2)0.220.33-34%0.230.34-32%0.80
EPS, EUR0.200.31-35%0.180.35-50%0.07
Free cash flow per share, EUR-0.030.00 -0.40-0.25-58%0.81

1) Excluding IACs and purchase price allocation amortisations (PPAs)
2) Excluding IACs
3) In 2020 and 2019, discontinued operations include Sanoma Media Netherlands and certain minor subsidiaries acquired in 2019 and planned to be divested in the future. In Q2 2020, result of discontinued operations includes a positive capital loss adjustment of EUR 1 million and in H1 2020 a capital loss of EUR 2 million (2019: 105) related to costs to sell for the divestment of Media Netherlands.

President and CEO Susan Duinhoven:

“We have had a good first half of the year despite the coronavirus pandemic, which had a significant impact not only on our business, but also on the everyday lives of our customers and our employees. Most of our employees have worked from home and we are glad that we have had only a small number of corona illness cases. During the exceptional times of past months, we have still actively executed our long-term strategy. Divestment of Media Netherlands was closed in April, and a week ago we divested Oikotie, the leading online classifieds business in Finland, to Schibsted for an EV of EUR 185 million. These transactions increase our strategic focus on Learning and the chosen core businesses of Media Finland: news & feature, entertainment and B2B marketing solutions. In the second quarter, we further strengthened the news & feature business by completing the acquisition of Alma Media’s regional news media business. The integration has started according to our plans, there is a good cultural fit and we see great potential for future innovation and successful growth in digital news subscriptions.

In Media Finland, subscription sales grew again during this quarter, driven by strong growth in digital subscriptions. The total number of subscriptions for Helsingin Sanomat grew by 6%, partially supported by the newly launched HS Kids; the first issue will be delivered in August. Subscriptions of Ruutu+ and Supla+, our subscription-based VOD and audio services, also developed well. Due to the corona pandemic, advertising sales declined significantly. We expect a slow recovery in advertising sales during the second half of the year. The pace of the recovery, the impact of a possible second wave of the pandemic and the economic development after summer are currently very uncertain and thus it is still too early to make reliable and specific estimates about the full-year impact.

In Learning, the corona pandemic was visible in the high number of users on our digital learning platforms in the second quarter, when schools in our markets applied remote teaching. We also supported the teachers and students by opening up certain digital learning services free of charge. In Learning, we have had only minimal impact of the corona pandemic on our business result. After the acquisition of Iddink in September 2019, we now see, for the first time, that part of our typical second quarter learning material sales in the Netherlands and Belgium are reported as Group internal sales to Iddink as a distributor. This shifted a significant part of our sales and earnings from the second to the third quarter, when the new school year starts. Learning is well on-track towards what we indicated for full-year 2020 in our Analyst and Investor Update in December 2019: approx. EUR 500 million net sales and around 20% operational EBIT margin excl. PPA.

The recent divestments provide us with funds for future growth. Going forward, we will have EUR 400-500 million headroom for future M&A, where our primary focus will be on growing our learning business. We are working on a solid pipeline of potential targets, even during the current exceptional times with the coronavirus pandemic. We stay focused on our long-term strategic priorities and our financial targets remain unchanged.”

Analyst and investor conference

An analyst and investor webcast and teleconference will be held in English by the President and CEO Susan Duinhoven and CFO and COO Markus Holm at 11:00. The live webcast can be followed via

To ask questions by phone during the live webcast, please join in 5–10 minutes prior to the starting time by dialing one of the following numbers:

Finland: +358 9 8171 0310
Sweden: +46 8 5664 2651
United Kingdom: +44 33 3300 0804
United States: +1 631 913 1422

Confirmation code for the call is 63673818#.

An on-demand replay of the webcast will be available shortly after the conference at

Interview opportunities for media by Teams or by phone are available after the conference. Media representatives are asked to book interviews via Communications Director Marcus Wiklund,

Additional information
Kaisa Uurasmaa, Head of Investor Relations and CSR, tel. +358 40 560 5601

About Sanoma

Sanoma is an innovative and agile learning and media company impacting the lives of millions every day.

Our learning products and services enable teachers to develop the talents of every child to reach their full potential. We offer printed and digital course materials as well as digital learning and teaching platforms for primary, secondary and vocational education, and want to grow our business across Europe.

Our Finnish media provide independent journalism and engaging entertainment also for generations to come. Our unique cross-media position offers the widest reach and tailored marketing solutions for our business partners.

Today, we operate in eleven European countries and employ close to 4,500 professionals. In 2019, our net sales totalled 900m€ and our operational EBIT margin excl. PPA was 14.8%. Sanoma shares are listed on Nasdaq Helsinki. More information is available at