Press release
| PLN million | 1-3Q 2008 | 1-3Q 2007 | yoy % change |
| Revenue | 941.8 | 919.9 | 2.4% |
| Net profit | 53.9 | 73.6 | (26.8%) |
| Operating EBITDA | 154.2 | 167.7 | (8.1%) |
| Net cash from operating activities | 147.5 | 160.2 | (7.9%) |
Figures for 1-3Q 2008 (yoy comparison)
• Revenues of the Group amounted to PLN 941.8 million (up 2.4%). Advertising sales reached PLN 678.1 million (up 11.6%), revenues from copy sales PLN 151.8 mln (down 2.1%) and book sales brought PLN 40 million (down 58.4%).
• According to Agora's estimates advertising spending for all media grew to PLN 5.7 billion (up 15%). Spending on TV reached PLN 2.6 billion. Internet grew the fastest while spending on dailies grew by over 4%.
• Gazeta's advertising sales reached PLN 370.2 million (up 4.4%) and its copy sales generated PLN 115.3 million (down 4.4%). Gazeta sold 409 thou. copies on average and its share in total newspaper advertising market reached ca. 42%. Free daily Metro increased its ad revenues to PLN 27.7 million (up 36.5%) and reached positive operating EBITDA.
• Advertising revenues from the Group's Internet operations grew ahead of the market rate and reached PLN 32.7 million (up 99.4%) and ad sales of vortals amounted to PLN 13.9 million (up 24.1%). In August 2008 total reach of all Agora Internet brands grew to 45.8%.
• AMS grew revenues to PLN 134.7 million (up 9.2%) and delivered 15.3% operating EBITDA margin.
• Revenues of magazines reached PLN 83.8 million (up 8.3%) and the segment's operating EBITDA increased by 14.3% to PLN 18.4 million.
• Radio stations grew revenues to PLN 59.9 million (up 22.5%) and posted positive operating EBITDA of PLN 5.1 million.
• Total operating expense of the Group reached PLN 871.8 million (up 5%). This was caused by salary regulations executed in 2q2008, higher marketing expense (which decreased in 3q2008 by 2.3%), headcount increase in Internet division and AMS and consolidation of the subsidiary Trader.com (Polska). Employment in the Group reached 3685 posts (up 259 posts), which includes 111 posts of Trader. Staff costs (excluding non-cash cost of share-based payments) reached PLN 218.3 million (up 15.9%) and according to Company's estimates may grow by the end of 2008 by ca. 14% (excluding consolidation of Trader).
• Operating EBITDA of the Group stood at PLN 154.2 million (down 8.1%), while its operating EBITDA margin reached 16.4%. Group's net profit attributable to the equity holders of the parent amounted to PLN 54.1 million.
• At the end of September 2008 the Group had PLN 267.8 million in cash and in equivalents. Group's accessible credit line was PLN 800 million from which, on the day of this press release, it used PLN 139.5 million.
Marek Sowa, President of the Management Board said:
The company's third quarter results reflect a negative impact of ad market slowdown due to global financial crunch and macro instability. Today, it is hard to estimate 2009 ad market performance, yet we know that solid fundamentals, market position vis a vis competitors and proper cost discipline are of the essence in such market circumstances. We proved to have successfully leveraged these strengths in the past. Current market context may well be favorable for companies like Agora - liquid, with cash at hand that could be used to win value accretive assets at reasonable prices.
3Q2008 market performance and financial results of Agora's major lines of business (yoy comparison)
NEWSPAPER MARKET / GAZETA WYBORCZA
Gazeta Wyborcza maintained its leadership position among the opinion-making newspapers. It sold 392 thou. copies on average (down 9.9%) and it's copy sales revenues declined by 15.3%. Copy sales of Dziennik declined by 9.9% to 156 thou. copies, Rzeczpospolita sold 152 thou. copies (down 6.9%) and Fakt sold 484 thou. copies (down 5.6%). Super Express grew paid circulation by 0.2% to 202 thou. copies.
Polskapresse's local dailies under the nationwide title Polska recorded the following copy sales figures for "old titles" - Polska Dziennik Bałtycki (50 thou. copies), Polska Dziennik Łódzki (43.6 thou. copies), Polska Dziennik Zachodni (77.9 thou. copies), Polska Gazeta Krakowska (30.7 thou. copies), Polska Głos Wielkopolski (49.3 thou. copies), Polska Gazeta Wrocławska (33.7 thou. copies) and for "new titles" - Polska Białystok (0.7 thou. copies), Polska Gazeta Opolska (1.4 thou. copies), Polska Kielce (0.8 thou. copies), Polska Koszalin (0.6 thou. copies), Polska Kujawy (1.1 thou. copies), Polska Lubuskie (1.1 thou. copies), Polska Mazowsze (2.3 thou. copies), Polska Metropolia Warszawska (18.6 thou. copies), Polska Olsztyn (0.7 thou. copies), Polska Rzeszów (1.2 thou. copies), Polska Szczecin (1.1 thou. copies). Total number of copies sold of the 11 "new titles" of Polskapresse constitiutes 8% of total copy sales of all titles under the national title Polska. As the dailies market in Poland remains very competitive, some publishers have already decided to rise copy prices of their newspapers. Dziennik sells for PLN 1.8 on weekdays and for PLN 2.0 on Fridays and Saturdays (PLN 1.5 before). Titles united under the Polska brand sell for from PLN 1.40 to PLN 1.50 weekdays and Rzeczpospolita for PLN 3.40. Recent poor circulation figures brought about attempts to impede circulation decline by means of the so-called 'other paid forms of distribution'. In practice it means that in the third quarter of 2008 ca. 45% of Dziennik's paid circulation and over 14% of Rzeczpospolita's paid circulation were sold through bartering or the like methods. Other paid forms of distribution constituted 6% of Gazeta's total paid circulation. Gazeta Wyborcza posted good readership results. It reached almost 4.9 million readers (16.2% reach, CCS - weekly readership index), which is almost 1.5 times more that the number of readers of 18 local dailies under the nationwide title Polska and 3 times more that the number of the readers of Rzeczpospolita or Dziennik. Gazeta's net advertising revenues amounted to PLN 106.5 million * (down 6.4%) while its share in display advertising in dailies reached ca. 40% (down 1.5 pp%). The share of Fakt in total newspaper advertising spending reached 5.5% while that of Dziennik stood at 7% and remained flat yoy.
