Sanoma Corporation, Stock Exchange Release, 4 May 2023 at 8:30 EET

Sanoma Corporation, Interim Report JanuaryMarch 2023: Net sales grew, inflation and increased seasonality lowered operational EBIT

This release is a summary of Sanoma’s Interim report January–March 2023. The complete report is attached to this release and is also available at

Q1 2023

  • The Group’s net sales grew to EUR 218 million (2022: 211). Net sales grew slightly in Learning due to the Italian and German business acquired at the end of August 2022 and were stable in Media Finland. The Group’s organic net sales development was -1% (2022: 1%).
  • Annual seasonality in the learning business was further amplified by the acquisition in Italy and the Group’s operational EBIT excl. PPA decreased to EUR -31 million (2022: -10). Earnings were also affected by higher paper, personnel and fixed costs compared to Q1 2022, when there was no cost inflation impact yet, as well as lower advertising sales in Media Finland.
  • EBIT was EUR -43 million (2022: -22). Items affecting comparability (IACs) were EUR -2 million (2022: -3). Purchase price allocation adjustments and amortisations (PPAs) grew to EUR 10 million (2022: 9) as a result of the acquisition in Italy and Germany.
  • Operational EPS was EUR -0.23 (2022: -0.10).
  • EPS was EUR -0.25 (2022: -0.11).
  • As typical for the seasonally small first quarter, free cash flow was negative and amounted to EUR -68 million (2022: 39). The decline was mainly attributable to the addition of the acquired Italian business and lower earnings.
  • Net debt/Adj. EBITDA was 3.2 (2022: 2.6), being seasonally slightly above the long-term target level of ‘below 3.0’.
  • On 9 March, Sanoma announced that it will issue a EUR 150 million hybrid bond to strengthen its balance sheet to increase the financial flexibility and support the execution of the strategic plan. The hybrid bond was issued on 16 March.
  • On 19 April, the Annual General Meeting decided that a dividend of EUR 0.37 per share (2021: 0.54) shall be paid for 2022 in three instalments. The first instalment of EUR 0.13 was paid on 28 April, the second instalment of EUR 0.13 will be paid in September and the third instalment of EUR 0.11 in November.

Outlook for 2023 (unchanged)

In 2023, Sanoma expects that the Group’s reported net sales will be EUR 1.35‒1.4 billion (2022: 1.3). The Group’s operational EBIT excl. PPA is expected to be EUR 150−180 million (2022: 189).

Regarding the operating environment, Sanoma expects that:

  • The economies in the Group’s operating countries, particularly in Finland, will experience a mild recession.
  • The advertising market in Finland will decline slightly, with most of the decline during the first half of the year.

President and CEO Susan Duinhoven:

”The year started as we had anticipated. In Learning, the first quarter is always seasonally small in net sales, with all sales and marketing efforts for the high season gearing up, and consequently this is always a loss-making quarter. The acquisition made in Italy in August 2022 has increased the seasonality of our business and thus the first quarter has become increasingly loss-making. This was further amplified by the impact of the high cost inflation, which is being compared to the close-to-zero inflation environment we still had a year ago. We have implemented increases in our selling prices that will have the biggest positive impact from the third quarter onwards, and are taking cost mitigation actions across the business. Overall, it will take 1−2 years before the impact of the high inflation will be fully transferred into prices. In Italy, the integration has continued according to our plans, the cultural fit of Sanoma Italia with the rest of Sanoma Learning is strong, and the teams are well-prepared for the upcoming high season.

In Media Finland, a different sales mix and high inflation had an impact on operational earnings. Higher margin advertising sales declined by 5% against a solid start to the comparison year 2022. We gained market share in digital advertising, but lost some in TV due to continued prudent TV content investments. This follows our projection that for the full year 2023, the advertising demand will decline slightly, with most of this taking place during the first half of the year. The slight decrease in the total number of subscriptions reflecting the weakening consumer confidence continued, while the targeted price increases generated overall stable subscription sales. There was a significant increase in paper and fixed costs compared to the first quarter of 2022, when there was basically no inflation impact yet – not even in paper prices, as we were still using the inventories we had built before the price increases accelerated. We have a good culture of active and conscious cost containment in place, and the teams across the business continue to reduce costs and improve processes very well in challenging conditions – despite this, we expect Media Finland’s operational earnings to decline by one third compared to full-year 2022.

Mirroring the increased seasonality with the acquired Italian business and the inflated costs, the free cash flow decreased significantly in line with our expectations. As communicated in February, the larger scale of the learning business will significantly increase the working capital required during the first half of 2023 versus the previous year, correspondingly leading to the clear majority of the cash coming in only in the third and fourth quarters. For the full-year 2023, we expect the Group’s free cash flow to temporarily decline. It will be impacted by the normalised free cash flow of the acquired Italian business, lower earnings in Media Finland, continued integrations and investments in our digital platforms as well as significantly higher financial expenses.

In early March, we issued a EUR 150 million hybrid bond. We consider the bond as the best way to strengthen our balance sheet to increase financial flexibility and support the execution of our strategic plan at all times, given the increased annual cyclicality of our business. In the current volatile capital markets, we wanted to make this transaction as soon as it was possible for us and were pleased with the broad distribution and significant oversubscription of the issue. Including the impact of the hybrid bond, our leverage (net debt / Adj. EBITDA) at 3.2 was stable compared to the end of 2022. During the second quarter, the leverage will seasonally increase. It is good to realise that the above leverage differs from the one that is used for our debt covenants, where the definition of net debt to non-adjusted EBITDA is used instead of adjusted EBITDA. Adjusted EBITDA is significantly lower compared to the non-adjusted EBITDA, as the annual amortisations typical for our business (broadcasting rights, pre-publication and rental book amortisations) have been deducted, while for debt covenants the leverage is calculated by using the much higher non-adjusted EBITDA that excludes the said amortisations.

Our Outlook for 2023 remains unchanged. The first quarter performance was in line with our own internal expectations. This year, we will focus on further building the long-term strengths of our businesses around learning content, harmonisation of digital learning platforms, integration of recent acquisitions and leading offering in digital news and entertainment, and thus coming out of the recession even stronger than we went in. We remain committed to our growth strategy and continue to be interested in value-creating acquisitions in K12 learning content. In the near term, we are most interested in smaller in-market acquisitions, as our main focus this year will be on integrating the acquired Italian business and gaining the scale benefits that our European learning portfolio can offer.

Another step in integrating sustainability even deeper into our business was taken in early March, when we included climate and accessibility related sustainability KPIs into our EUR 300 million Revolving Credit Facility. Our climate targets in line with the Science-Based Targets initiative are currently being reviewed, and we are expecting the validation to be finalised after summer.

I would like to thank our employees for their commitment, innovativeness, and agility as we are progressing towards the learning high season confidently and well-prepared. Thanks to our teams, we continue to give our best in serving our customers across the business also in these volatile and sometimes challenging circumstances.” 

Key indicators

EUR millionQ1 2023Q1 2022ChangeFY 2022
Net sales217.8210.63%1,298.3
Operational EBITDA 1)11.728.8-59%355.4
Margin 1)5.4%13.7% 27.4%
Operational EBIT excl. PPA 2)-30.7-10.4-195%189.3
Margin 2)-14.1%-4.9% 14.6%
Result for the period-39.8-18.3-118%77.0
Free cash flow-67.9-39.3-72%111.7
Equity ratio 3)40.6%39.3% 35.8%
Net debt756.5663.0 823.4
Net debt / Adj. EBITDA3.22.6 3.2
Operational EPS, EUR 1)-0.23-0.10-126%0.65
EPS, EUR-0.25-0.11-118%0.47
Free cash flow per share, EUR-0.42-0.24-72%0.68
Average number of employees (FTE)5,0544,826 5,018
Number of employees at the end of the period (FTE)5,0704,852 5,079

1) Excluding IACs
2) Excluding IACs and purchase price allocation adjustments and amortisations (PPAs)
3) Advances received included in the formula of equity ratio were EUR 131.6 million in Q1 2023 (2022: 138.6).

Analyst and investor conference

An analyst and investor conference will be held in English by the President and CEO Susan Duinhoven and CFO Alex Green at 11:00 EET at Sanomatalo, Flik Studio Eliel, 1st floor, Töölönlahdenkatu 2, Helsinki.

The conference can be followed as a live webcast at

Management presentation is followed by a Q&A session. Questions can be placed through the webcast chat function or by phone. To ask questions by phone, the participant is required to register at After the registration you will receive the phone number and conference ID to access the conference. If you wish to ask a question, please press *5 on your telephone keypad to enter the queue.

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 Sustainability, tel. +358 40 560 5601

Sanoma is an innovative and agile learning and media company impacting the lives of millions every day. Our Sustainability Strategy is designed to maximise our positive ‘brainprint’ on society and to minimise our environmental footprint. We are committed to the UN Sustainable Development Goals and signatory to the UN Global Compact.

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

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 twelve European countries and employ more than 5,000 professionals. In 2022, our net sales amounted to approx. 1.3bn€ and our operational EBIT margin excl. PPA was 14.6%. Sanoma shares are listed on Nasdaq Helsinki. More information is available at