Goldbach Group AG

EANS-Adhoc: Goldbach Group AG
Increase in profits, turnover stable

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6-month report

21.08.2012

Ad hoc press release


Half year result 2012:
Goldbach Group: Increase in profits, turnover stable

Turnover CHF 209 million - EBIT down by 5% - Profits up by 11% - Sustained
growth in TV and radio - Setbacks in online business - Focus of online strategy

Kusnacht-Zurich, August 21st, 2012. Goldbach Group's net revenue in the first
half of 2012 was down 0.4% on the corresponding period in the previous year
(+0.6% after currency adjustment) at CHF 208.9m (previous year CHF 209.8m),
while the EBIT of 13.8m represented a 4.8% drop in comparison to the previous
year (CHF 14.5m). The advertising logistics specialist, which pursues the
marketing of private electronic, mobile and interactive media and online
marketing in the German-speaking countries, the Adriatic region and eastern
Europe, thus attained an EBIT margin of 6.6% (previous year 6.9%). Cost-cutting
measures which took effect in the first half of the year should have an even
more pronounced impact on the income statement in the second half. Goldbach
expects an increase in profit for the current 2012 financial year, despite the
stagnant turnover situation. In view of the unsatisfactory course of business
for Goldbach Audience and the emerging consolidation at Goldbach Interactive,
Goldbach has reviewed its online strategy and decided to focus on lines of
business harbouring high development potential. 

Media business line grows with TV and radio business

Turnover in the Media business line, which pools Goldbach Group's marketing
activities in the area of private TV, radio and digital out-of-home advertising,
first and foremost in Switzerland, as well as in Austria and Romania, rose
markedly once again in the first half of 2012, increasing by 7.5% (7.6% after
currency adjustment) to CHF 165.6m (previous year CHF 154.1m). Growth in radio
business was particularly outstanding, at 17%. TV business rose by 6%. The
increase in turnover derives primarily from Goldbach's existing customer
portfolio. Advertising in classic media such as TV and radio remains in demand
in a generally contracting advertising market, once again affirming the trend
witnessed in recent years. Since 2011, the Media business line has been
marketing a network of local private TV stations in Romania and eastern Europe.
Romanian TV business is developing very positively, showing a growth rate of
over 30%. Goldbach Media's market share in Switzerland rose once again. The
Media business line contributed 79% to Goldbach Group's total turnover in the
first half of 2012 (previous year 74%). EBIT for the Media business line rose
slightly, by 0.1%. The Media segment accounted for 86% of the Group EBIT
(previous year 85%).

Business sluggish for Audience business line - increase in turnover with online
moving images

The Audience business line spans Goldbach's product range in the areas of online
advertising and performance marketing. This business line suffered a substantial
drop in turnover in the first half of 2012, falling by 27.8%
(-24.2% in local currency) to CHF 27.7m (previous year 38.4m). EBIT rose by
63.5% to CHF 2.6m (previous year CHF 1.6m) as a result of cost cutting to the
tune of 20% and a one-off effect. As in previous years, low-margin bulk business
was avoided in the Audience business line. Substituting this with high-margin
business proved difficult in the generally declining display markets in
Switzerland and eastern Europe, however. The business line additionally lost a
number of clients mainly in Poland (direct marketing facebook). In contrast, the
Goldbach Video Network which was launched in February 2012 to sell moving image
advertising is proving a sales driver. Against the background of the rapid
spread of mobile devices such as smartphones and tablets, TV is being used ever
more frequently and for longer periods online and on the move. The Audience
business line accounted for 12% (previous year 16%) of overall turnover in the
first half of 2012 and 13% (previous year 8%) of the Group's EBIT - whereby the
latter result was attributable primarily to a one-off effect. In response to the
clearly unsatisfactory course of business for the Audience business line in the
second half of 2012, Goldbach Group has reviewed its online strategy and decided
to focus its efforts on developing moving image marketing.

Interactive business line: Consulting services for interactive marketing in
demand - customers lost and substantial investments

Goldbach Group's Interactive business line has been offering concept
development, design and technological services for interactive and mobile
communication and marketing solutions since 2008. This area of business is now
established throughout the German-speaking countries and in Poland and Russia as
well. Turnover for the Interactive business line fell by 8.1% (5.5% in local
currency) in the first half of this year, to CHF 18.5m (previous year CHF
20.1m). EBIT dropped by 86.7% over this period, to CHF 0.2m. This decline in
turnover is attributable primarily to the change of the number of key consulting
mandates in Switzerland. Demand for consulting services in connection with
online communication and in the area of mobile advertising and social media
remains high. The Interactive business line contributed 9% (previous year 10%)
to Goldbach Group's overall turnover and 1% to the Group EBIT (previous year
7%).

Total turnover on the level of previous year

In all, the Media business line accounted for 79% of total turnover in the first
half of 2012 (previous year 74%), while the Audience business line contributed
12% (previous year 16%) and the Interactive business line made up 9% (previous
year 10%). The share of Swiss business rose in the first six months to 88%
(previous year 86%), while the share of international business stands at 12%
(previous year 14%).

Profit and equity ratio

The net profit amounted to CHF 3.4 million (prior year: CHF 3.1 million) and
increased by 11% over the prior year period. As of the end of June 2012, the
equity ratio amounted to 31.5% (as of end of June 2011: 28.9%). The operative
cash flow generated in the first half of the year amounts to CHF 3.1 million
(previous year CHF 7.3 million).

Outlook

For 2012 as a whole, against a backdrop of continuing difficult conditions on
the online market and sustained high demand in TV business, Goldbach Group
expects turnover to be on a par with the previous year, while the profit for the
year is expected to be higher as a result of the successfully implemented
cost-cutting measures.

"Goldbach Group has been investing in the development of online media and
broadening its presence in the classic electronic media such as TV for some
years now. TV and video are now becoming interactive, and moving image media as
well as mobile and interactive communication are converging. Goldbach Group is
at home in both worlds and in a virtually unrivalled position to benefit from
the growing importance of the moving image in its capacity as an advertising
logistics specialist."



To analysts, investors and media representatives: 
You can find the half year result report 2012 of Goldbach Group on the following
website: 
http://www.goldbachgroup.com/investor-relations-en/half-year-report-2012


Further inquiry note:
Paul Riesen, Germaine Mueller
Tel.    +41 44 914 91 00
Mobile: +41 79 688 24 74
germaine.mueller@goldbachgroup.com
paul.riesen@goldbachgroup.com

end of announcement                               euro adhoc 
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issuer:      Goldbach Group AG
             Seestrasse 39
             CH-8700 Küsnacht
phone:       +41 44 914 91 00
FAX:         +41 44 914 93 60
mail:     info@goldbachgroup.ch
WWW:      www.goldbachgroup.ch
sector:      Media
ISIN:        CH0004870942
indexes:     SPI, SPIEX
stockmarkets: Main Standard: SIX Swiss Exchange 
language:   English
 



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