North Media Q3 2020: Sustained revenue and profit improvement, guidance narrowed
Announcement no. 25-2020
5 November 2020
North Media reported continued increase in EBIT for the third quarter and for 2020 to date. All three business areas contributed to the improvement. Full-year 2020 guidance narrowed within previously announced ranges.
Q3 2020 highlights (Q3 2019 comparative numbers in brackets):
- Consolidated revenue up by 7% to DKK 261 million. All three business areas reporting growth.
- FK Distribution reported 6% revenue growth, as the third quarter included an extra week of distributing retail leaflets and local newspapers. Volumes normalised after COVID-19 impact in the second quarter.
- North Media Online (digital platforms) and Bekey (digital access solutions) reported growth rates of 19% and 14% respectively. Ofir, Online’s jobs platform, reported 33% growth in the quarter.
- Consolidated EBIT before special items improved to DKK 60 million (DKK 33 million).
Q3 ytd 2020 highlights (Q3 ytd 2019 comparative numbers in brackets):
- Consolidated revenue up by 2% to DKK 771 million (DKK 754 million).
- EBIT before special items of DKK 182 million (DKK 101 million). EBIT margin improved to 23.6% (13.4%); return on invested capital (ROIC) was 57.6% (28.5%).
- Profit for the period of DKK 219 million (DKK 131 million) makes a 29.9% return on equity.
- FK Distribution lifted EBIT to DKK 177 million (DKK 107 million) on unchanged revenue. Efficiency improvements, particularly the transition to a single weekly distribution round, offset the effects of a structural loss of volume.
- North Media Online improved EBIT to DKK 17 million (DKK 5 million) on 18% revenue growth driven by BoligPortal and Ofir. Ofir has nearly completed its turnaround and was profitable in September.
- Bekey reduced its EBIT loss to DKK 5 million (DKK 8 million loss) on 22% revenue growth, particularly on sales to Danish municipalities. Bekey continues to build a presence in the rapidly growing market for home delivery of parcels, groceries, meal services, etc. – currently in positive talks with potential customers.
Guidance for 2020 narrowed
North Media narrowing full-year 2020 guidance. Revenue and EBIT now expected at the upper end of previously guided ranges. The change is based on the greater certainty about FK Distribution’s performance.
- Revenue now expected in the DKK 1,020-1,045 million range (previous guidance: DKK 1,005-1,045 million).
- EBIT before special items now expected in the DKK 230-245 million range (previous guidance: DKK 215-245 million).
- Double-digit growth in both North Media Online and Bekey expected to almost fully offset a 3% drop in FK Distribution revenue.
- All three business areas expected to report EBIT improvements.
- Increased level of uncertainty persists due to COVID-19 and the consequences of the pandemic.
“Thanks to broadly-based improvements across the Group, we are well under way to improving EBIT for the fourth consecutive year. North Media Online and Bekey both have momentum, reporting sustainable double-digit growth, and North Media Online is set to treble EBIT this year. In addition, FK Distribution is reporting much higher EBIT after we reduced our costs through the transition to a single weekly distribution round,” said Kåre Wigh, Group Executive Director & CFO.
For additional information, please contact:
Kåre Stausø Wigh, Group Executive Director & CFO, mobile
This document is an unofficial translation of the Danish original. In the event of any inconsistencies, the Danish version shall apply.
North Media provides platforms and channels for businesses to communicate with consumers. The Group has three business areas: FK Distribution provides packing and distribution of printed matter, local newspapers, etc. and runs the digital advertising platform minetibud.dk. North Media Online runs the marketplaces BoligPortal.dk (rental housing portal), Ofir.dk (jobs portal) and Lead Supply (loan portal). BEKEY offers access solutions that enable approved distributors, home care workers and others to access stairwells and private homes through a secure digital platform. Several of North Media's businesses hold market-leading positions. North Media has about 450 employees.
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