TV Loonland AG

euro adhoc: TV Loonland AG
Annual Reports
Balance sheet adjustment to bring high depreciations and amortizations with continuing positive EBITDA - Serious industry crisis causes revenue losses - Successful cost savings program - Positive operating ca

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Munich, March 31, 2003 - TV-Loonland, Munich, has drawn some conclusions from the difficult market conditions and undertaken some extensive depreciation and amortization of its film assets and goodwill. Despite the persistent market weakness, however, the company, which is one of the leading international producers of programming for children, youth and families, was able to achieve continued positive operating income (EBITDA) amounting to 7.4 (previous year: 30.4) million EUR while maintaining a positive operating cash flow.

The continued reluctance of TV broadcasters to purchase licenses in the midst of the global advertising crisis led to a drop in revenue to 36.8 (77.5) million EUR. TV-Loonland responded to this low demand with a strict restructuring and cost savings program. Because of the delayed effect, however, this will only have its full positive effect in the course of 2003. Increased flexibility of costs allowed cost of purchased materials and services to be lowered by 50.3 percent to 23.7 (47.7) million EUR alongside the ongoing drop in revenue. Other operating expenses were also significantly reduced by 18 percent to 13.0 (15.9) million EUR. On the other hand, personnel expenses rose slightly, by 2.8 percent to 6.1 (5.9) million EUR, despite a significantly smaller number of employees - 142 compared to 240 the previous year - because of necessary compensation payments, but will prove to be lower in fiscal 2003.

Earnings were significantly impacted by depreciation and amortization amounting to 81.7 (15.1) million EUR on film assets and 8.1 (0.7) million EUR amortization (and impairment) of goodwill. This step allows TV-Loonland to effectively adjust the balance sheet, while creating the basis for a sustainable, secure upturn in income when demand is once again on the rise. Capitalized goodwill comes in at only 0.9 million EUR, while the capitalized residual value of film assets amounts to 43.3 (96.9) million EUR. On December 31, the balance sheet still included the loss-making Korean subsidiary, SRE Corp., with 6.6 million EUR in film assets and 12.5 million EUR in bank loans and overdrafts. The subsidiary was sold in the first quarter of 2003.

end of announcement            euro adhoc 01.04.2003
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Further inquiry note: Ilona McLean Tel.: +49 (0)89 20 50 80 E-Mail: imclean@loonland.com

Branche: Media
ISIN:      DE0005348403
WKN:        534840
Index:    Nemax All Share
Börsen:  Frankfurter Wertpapierbörse / Neuer Markt
              Baden-Württembergische Wertpapierbörse / free trade
              Bayerische Börse / free trade
              Berliner Wertpapierbörse / free trade
              Bremer Wertpapierbörse (BWB) / free trade
              Börse Düsseldorf / free trade
              Hamburger Wertpapierbörse / free trade
              Niedersächsische Börse zu Hannover / free trade



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