Talentum Q2 2006 Interim Report

STOCK EXCHANGE RELEASE

July 21, 2006 at 8.30 am

TALENTUM OYJ Annankatu 34-36 B FI-00100 Helsinki Tel.+358(0) 20 442 40 Fax +358(0)20 4424 130 www.talentum.com 1(16)

TALENTUM DEVELOPMENT EMPHASIS AND ONE-OFF EXPENSES AFFECT THE FINANCIAL RESULT TALENTUM JANUARY-JUNE 2006 (IFRS) January-June 2006 - Net sales: EUR 61.2 million (EUR 49.1 million) - Operating profit: EUR 3.0 million (EUR 4.6 million) - Cash flow from business operations: EUR 6.0 million (EUR 5.0 million) - Earnings per share: EUR 0.05 (EUR 0.06) - Equity ratio: 34.7% (35.6%) The consolidated net sales increased 24% in January-June compared with the previous year and totalled EUR 61.2 million (EUR 49.1 million). Talentum Sweden contributed EUR 11.0 million to the growth in net sales and, eliminating the effect of the acquisition (October 6, 2005), net sales went up by 2%. The b-to-b advertising market which is of particular interest to Talentum was subdued in the second quarter, and advertising sales fell short of the target. Outlook for the year as a whole remain unchanged, however. In publishing, the profit from books was more than EUR 0.7 million down from the previous year, but the traditionally strong last quarter is expected to be stronger this year than in previous years and will thus compensate for this. The consolidated operating profit decreased in the first half of the year to EUR 3.0 million (EUR 4.6 million). The consolidated operating profit increased by EUR 0.6 million as a result of the addition of Talentum Sweden but decreased by EUR 0.5 million as a result of the divestment of the Internet consulting business. Talentum development emphasis on new products and one-off expenses show in the financial result as a short-term weakening. The most significant project in the first half of the year was the Focus magazine project. As announced on June 20, 2006, Talentum is withdrawing from the introduction of the magazine in Finland. The costs of the Focus magazine project, totalling around EUR 1 million, have been recognized as expenses in their entirety in the accounts for the first half of the year, which explains the increase in Group items to EUR 2.2 million (EUR 1.1 million). IAS/IFRS REPORTING Talentum transferred to International Financial Reporting Standards (IFRS) on January 1, 2005. This interim report has been drawn up according to the IFRS recognition and valuation principles. In drawing up this interim report, Talentum has applied the same accounting principles as in the financial statements for 2005, which contains a description of those principles. The interim report is unaudited. TALENTUM CEO HARRI ROSCHIER: TALENTUM SWEDEN IS GROWING WELL, PARTICULARLY AFFÄRSVÄRLDEN "Talentum Sweden is showing a growth rate of 20%, and the circulation and readership of Affärsvärlden have grown rapidly, as planned. The steady improvement of TV Content Production since last autumn is also an important positive development. Publishing in Finland did not do as well as last year because of emphasis on new products and slow growth in the advertising market during the second quarter. Also, book sales are stronger in the autumn. Overall, publishing will yield a good result this year too. "Reader surveys in both countries have given excellent results, supporting advertising sales in the autumn. Talouselämä was the uncontested front runner in


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the TNS PäättäjäAtlas 2006 media study with 30% increase in readership, and all Talentum publications performed excellently. For the first time in 40 years, the readership of Affärsvärlden exceeded that of Veckans Affärer, and the readership will continue to grow, considering that the circulation of Affärsvärlden is now 47,000, more than double what it was last autumn, and we will attain our target of 50,000 by the end of the year.” INDUSTRY AND TALENTUM OUTLOOK FOR THE THIRD QUARTER OF 2006 AND FOR THE FULL YEAR 2006 - Talentum expects that advertising will grow in the third quarter of 2006 as compared with the third quarter of 2005. - Talentum media increased their market share in the first half of 2006. Magazine advertising revenue increased by 8%, exceeding the market growth rate. The most significant factor in this was the 40% growth in job advertising, clearly exceeding the market growth rate. We expect that in the third quarter of 2006 our market share will remain roughly the same as in the second quarter of 2006. - Talentum expects that sales will show a seasonal fluctuation in the third quarter of 2006, being lower than in the first and second quarters. - Due to increased seasonal fluctuations in Publishing the result particularly in the fourth quarter is expected to be strong. - We continue to expect that the advertising market as a whole will grow in both Finland and Sweden in 2006, but we expect no significant growth in the b-to-b market apart from job advertising, in which considerable growth is expected. - The most important change in Talentum market shares is that Affärsvärlden has, for the first time in 40 years, become the leading financial weekly in Sweden. Affärsvärlden circulation has more than doubled in less than a year and continues to grow rapidly. Accordingly, we expect our market share to continue growing in the second half of 2006. - We expect that Talentum Sweden as a whole will grow by about 20% in 2006, clearly exceeding the market growth rate. Talentum Sweden net sales in January-June were about EUR 11 million, compared with EUR 18 million for the whole of 2005. - Talentum continues to target increasing its market share in all business areas in 2006. - Talentum expects that the foreseeable market situation will allow the consolidated profit in the second half of 2006 to exceed considerably the first half Focus-project adjusted consolidated profit. CONSOLIDATED NET SALES Consolidated net sales in the second quarter increased by 20% over the previous year and were EUR 30.2 million (EUR 25.2 million). The growth rate in the first half of the year was 24%. Talentum Sweden (acquired October 6, 2005) accounted for EUR 5.7 million of the EUR 5.1 million increase in net sales in the second quarter, and EUR 11.0 million of the EUR 12.0 million increase in net sales in the first half of the year. Eliminating the effect of the acquisition, net sales went up by 2%.


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Contributing to the weak performance in the second quarter as compared with the previous year was the fact that there were fewer working days in the second quarter this year: Easter and the holidays either side of it was in April this year, whereas last year it was in March. The biggest contributions to the consolidated net sales were the growth in Publishing (47%) and Direct Marketing (17%). Publishing’s net sales went up by 4%, excluding the effect of the acquisition (October 6, 2005) of Talentum Sweden. In addition, the short-term growth target for TV Content Production was attained (4%). Premedia net sales declined (-7%). Publishing accounted for 61% of the consolidated net sales in the first half of the year. TV Content Production accounted for 19%, Premedia for 17% and Direct Marketing for 7%. Inter-group business activities accounted for 4% of the consolidated net sales. Advertising revenue from Talentum’s magazines was up 8%, the most significant factor being the more than 40% increase in job advertising. The trend in advertising sales is a key variable in Publishing’s financial performance. Magazines and online activities account for about 85% of Publishing’s net sales, of which advertising sales account for 60%, and online advertising contributes about 10% towards the entire advertising net sales. Books and training bring in the remaining 15% of Publishing’s net sales. Talentum has integrated its business operations portfolio with resolute development work and the implementation of synergy. Talentum’s objective is to continue refining the business operations and synergy potential in a way that will support the company’s growth and create economic value added for the owners. CONSOLIDATED RESULTS Talentum’s consolidated operating profit for the first half of the year was EUR 3.0 million (EUR 4.6 million), i.e. 4.9% (9.3%), and the profit was EUR 2.4 million (EUR 3.0 million), i.e. 3.9% (6.1%). The operating profit for the second quarter was EUR 0.7 million (EUR 2.7 million), i.e. 2.3% of net sales (10.7%), and the profit was EUR 0.7 million (EUR 1.7 million), i.e. 2.2% (6.9%). Publishing and Direct Marketing performed well, TV Content Production performed very satisfactorily, and Premedia performed unsatisfactorily. Fluctuations in exchange rates did not have a significant effect on Talentum’s consolidated net sales or the financial performance. Talentum Group’s currency risk comprises risks concerning foreign currency flows and risks involved with translating shareholders’ equity denominated in foreign currencies, i.e. risks concerning the operations of Talentum Sweden. Most of the Group’s direct income and costs are generated in the euro zone. The earnings per share for the first half of the year were EUR 0.05 (EUR 0.06).


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CASH FLOW, FINANCIAL POSITION AND BALANCE SHEET The cash flow of business operations in January-June totalled EUR 6.0 million (EUR 5.0 million), and in April-June EUR 4.6 million (EUR 3.5 million). The decrease in working capital of EUR 2.5 million (EUR –0.4 million) improved the cash flow of business operations as compared with the previous year, while trade receivables decreased by EUR 5.2 million on the previous year. Net financial expenses in January-June were EUR –0.2 million (EUR –0.5 million), i.e. –0.0% of net sales (-1.0%). The total assets on June 30, 2006 amounted to EUR 93.8 million (EUR 77.4 million), of which cash and cash equivalents totalled EUR 22.6 million (EUR 21.0 million). The Group’s liquid assets are invested primarily in financial instruments and a small amount in shares. The change in cash and cash equivalents in January-June was EUR –0.0 million (EUR –7.4 million). The Talentum Group’s financial standing remained strong, and the equity-to-asset ratio at the end of the period under review was 34.7% (35.6%). The Group’s equity per share was EUR 0.69 (EUR 0.44) at the end of June. The Group’s interest-bearing liabilities at the end of the period under review stood at EUR 30.5 million (EUR 25.7 million). DEPRECIATION, AMORTIZATION AND IMPAIRMENT Consolidated depreciation, amortization and impairment amounted to 2.8% of net sales (4.5%), i.e. EUR 1.7 million (EUR 2.2 million), of which depreciation EUR 1.7 million (EUR 2.2 million). INVESTMENTS Gross investments in fixed assets in January-June totalled EUR 3.9 million (EUR 5.7 million), i.e. 6.4% of net sales (9.2%). Gross investments comprised mainly normal replacement and maintenance investment, such as procuring equipment, software and fixtures. Long-term investments in shares amounted to EUR 1.4 million (EUR 4.3 million). PERSONNEL The Group employed an average of 1,061 persons in January-June (1,242 persons). Of the employees, 27.5% (16.5%) worked abroad. The average number of staff broken down by sector is as follows: Publishing 399 TV Content Production 96 Premedia 217 Direct Marketing 333 Group Administration 16 MANAGEMENT No changes took place in the Group management during the second quarter.


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AUDITOR As disclosed on March 28, 2006 the AGM elected Authorized Public Accountant firm PricewaterhouseCoopers as auditor. Juha Wahlroos, APA, will start as the new responsible auditor on June 22, 2006. His predecessor Kari Miettinen, APA, will resign PricewaterhouseCoopers Oy. STRUCTURAL CHANGES In the comparison figures for 2005, this interim report presents Satama Interactive’s figures under the heading ‘Discontinued operations’ in the income statement. As announced on September 16, 2005, Talentum sold for EUR 23.2 million its 60% majority holding in Satama Interactive, a company that engages in Internet consulting and was listed on the Helsinki Stock Exchange NM List in 2000. Satama Interactive’s net sales in accordance with IFRS came to EUR 23.6 million and the operating profit to EUR 0.6 million in 2004. Talentum recorded a profit on disposal of EUR 10.5 million in the third quarter of 2005. In the second quarter of 2006, Talentum Sweden accounted for EUR 5.7 million of net sales and EUR 0.4 million of operating profit; the corresponding figures were EUR 5.2 million and EUR 0.2 million, respectively, for the first quarter of 2006 and EUR 5.8 million and EUR 0.9 million, respectively, for the fourth quarter of 2005. On October 6, 2005, Talentum purchased the entire stock of the Swedish magazine publishing company Ekonomi & Teknik Förlag AB, and on December 15, 2005 the company was renamed Talentum Sweden. The total purchase price was EUR 17.4 million (SEK 142 million), of which EUR 11.0 million (SEK 102 million) was in cash and EUR 6.4 million (SEK 60 million) in Talentum Oyj shares. Talentum Sweden had net sales of some EUR 18 million in 2005. The net sales of Talentum Sweden are expected to increase considerably in 2006 over the previous year, and a profit is expected, although investment in growth will put a considerable strain on the financial performance. BUSINESS OPERATIONS AND SEASONAL FLUCTUATION IN THE MEDIA MARKET The general economic situation remained fairly good during the first six months of 2006. Contributing to the strong improvement in the market in the first quarter compared with the previous year was the falling of Easter and the holidays either side of it in a different quarter — this year it was in April, whereas last year it was in March. There is a seasonal fluctuation in the media and media services markets, and business is at its briskest during the final quarter of the year. Not all Talentum’s personnel resources are available during the summer holidays, and generally no magazines or books are put out in the summer. These characteristics of the business may cause considerable fluctuation in Talentum’s quarterly net sales and particularly in the profit: the figures are the highest in the last quarter, and correspondingly lower in the third quarter than in the first and second quarters. As a result of the seasonal fluctuation, the main part of net sales and an even greater part of the operating profit in publishing accrue in the latter half of the year. This is the most important reason for most of Talentum’s profit being made in the latter half of the year and the profit trend looking better towards the end of the year. The annual quarterly-based seasonal fluctuation in Publishing’s operating profit is increased from earlier periods by the seasonal fluctuation in Sweden being greater than in Finland because of the one-dimensional structure of the operations and the predominance of magazines.


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In order to eliminate the impact of this seasonal fluctuation, Talentum is presenting an income statement of the business areas for the past 12-month period (floating 12 months) and for the 12-month period before that as comparative data, in addition to the reporting periods required by the standard procedure. ORDER BACKLOG The order backlog is not detailed here, since this information is not relevant due to the nature of the business of the Talentum Group. As none of the Talentum business areas have orders extending forward for further than about one month, an order backlog in the conventional sense does not really exist. While customers and the company have signed commercial agreements for periods of several years, the company management does not consider that these agreements constitute an order backlog as such. BUSINESS RISKS Talentum takes controlled risks that are integrally linked with its corporate strategy and objectives. Risks relating to strategy and objectives are controlled and reduced in various ways. 40% of the consolidated net sales are linked with advertising, specifically with the b-to-b sector, which is susceptible to cyclical fluctuation. We try to control this market risk by increasing revenue from circulation sales and content-sales services. All our products and services aim at being market leaders in their own field, which makes it possible to succeed even during a low cycle. The company is not prepared to take risks that endanger continuation of operations or are difficult to control and cause substantial harm to the company’s operations. Risk management does not have a separate organization of its own; its responsibilities follow the division of responsibilities in business operations and the organization. The most important perceived risks are reported to the Board of Directors annually when operations are being planned, and the Board then analyses risks from the shareholder value perspective. In addition, internal auditing is outsourced to Tuokko Tilintarkastus Oy (PKF International), a professional and independent external service provider with sufficient resources. The internal auditing promotes and improves risk management in Talentum’s various operating areas. Talentum keeps an active eye on the market situation in order to be able to prepare for changes in the competition situation in advance. Competition has remained unchanged for a longer period now, but it is possible that the major media companies will increase their input in Talentum’s product areas significantly. The Talentum Group’s currency risks comprise risks concerning foreign currency flows and risks involved with translating shareholders’ equity denominated in foreign currencies i.e. risks concerning the operations of Talentum Sweden. The majority of the Group’s direct income and costs are generated in the euro zone. The basic principle for controlling risks concerning foreign currency flows is by matching income and costs. The basic principle for risks associated with translating shareholders’ equity is to try to hedge against large currency movements. Talentum tries to hedge against finance risks relating to its business operations by ensuring that stable financial conditions are created for


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developing. Customer’s payment behaviour is monitored constantly. Attempts are made to invest liquid funds in liquid money market instruments that have good credit standing. Liquid funds do not contain a major interest rate risk because of the short duration of the investments. BUSINESS AREAS Publishing Publishing performed very well during the first half of the year. Net sales in January-June were EUR 37.3 million (EUR 25.4 million), and the operating profit was EUR 3.6 million (EUR 4.0 million), i.e. 9.6% of turnover (15.6%). Publishing grew by 42% in the second quarter, and the operating profit there was 8.1% of turnover (14.9%). Talentum Sweden contributed EUR 5.7 million to the growth in net sales of EUR 5.5 million in the second quarter, and EUR 11.0 million to the growth in net sales of EUR 11.9 million in the first half of the year. Excluding the effect of the acquisition, the net sales increased by 4% in the first half of the year. Talentum Sweden contributed EUR 0.4 million to the operating profit in the second quarter and EUR 0.6 million to the operating profit in the first half of the year. The sector-based organization for Publishing, to which we transferred in August 2005, is aimed at speeding up growth, and the investment has brought some additional costs for Publishing in the early phases. Magazine publishing’s net sales in January-June totalled EUR 31.6 million (EUR 20.0 million) (Internet services accounted for around EUR 2.0 million [EUR 1.8 million]), book publishing’s net sales were EUR 4.5 million (EUR 4.5 million) and the net sales for training activities were EUR 1.1 million (EUR 0.8 million). The circulation revenue of Talentum’s magazines was up 11% and advertising revenue 8%. The most significant factor in the growth in advertising sales was the continued upturn in job advertising that started in the latter half of 2004. TV Content Production The net sales in January-June of Varesvuo Partners Oy, which concentrates on TV content production, increased by 4% (-3%) to EUR 11.9 million (EUR 11.4 million). The operating profit was EUR 0.8 million (EUR 0.2 million). The demand for commercials continued to rise following the upturn at the turn of the year. Net sales increased by 9% to EUR 4.6 million (EUR 4.2 million). TV Content Production continued investing in TV programme production. TV Content Production’s net sales went up by 6% to EUR 5.8 million (EUR 5.5 million). Premedia Premedia’s net sales in January-June decreased by 7% (-3%) to EUR 10.1 million (EUR 10.9 million). The operating profit was EUR 0.1 million (EUR 0.4 million). Internal streamlining measures in the Premedia business area continued. The streamlining costs affect the profit and financial performance will remain modest also in the second half of the year.


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Direct Marketing Direct Marketing’s net sales in January-June increased by 17% (–5%) to EUR 4.2 million (EUR 3.6 million). The operating profit was EUR 0.6 million (EUR 0.6 million). Direct Marketing’s success in Finland and the Baltic countries went according to plan. SHARES AND SHARE CAPITAL At the end of the period under review, Talentum Oyj’s share capital totalled EUR 18,593,518.79, comprising 44,220,817 fully paid-up shares. The book counter-value of each share was EUR 0.42 (not an exact value). The shares are listed on the Helsinki Stock Exchange Main List. At the end of the period under review, the company and its subsidiaries held 181,000 company shares, 0.41% of Talentum’s total stock and votes. Shareholdings of the Board of Directors and Managing Director On June 30, 2006, the number of Talentum Oyj shares and options owned by members of the Board of Directors and the CEO personally and through companies in which they have a controlling interest was 4,590,938, representing 10.4% of the company's total shares and votes. Board of Directors’ authorizations The Annual General Meeting on March 28, 2006 authorized the Board of Directors to decide, within one year of the meeting, on taking out one or several convertible bonds and/or issuing options and/or on increasing the share capital by a rights issue in one or several instalments, provided that the increase is no more than EUR 1,859,351.88 and that no more than 4,422,081 new shares are subscribed. The maximum increase in the share capital and the combined number of votes of the shares issued correspond to less than 10% of the company’s registered share capital and of the combined number of votes conferred by the shares. The Board of Directors has the right to decide on the subscription price, the grounds for determining the subscription price, other terms and conditions of the subscription, and the other terms and factors relating to the rights issue, issuing of options and taking out of a convertible loan. The authorization includes the right to overrule the shareholders' right of pre-emption. The authorization can be exercised only for financing mergers and acquisitions. As of June 30, 2006, the authorization had not been exercised. The Annual General Meeting on March 28, 2006 authorized the Board of Directors to decide, within one year of the meeting, on the acquisition of the company’s own shares using the company’s disposable funds in one or several instalments, but placed a limit of 4,422,081 on the maximum number of shares to be acquired, including the 181,000 shares acquired on the basis of previous acquisition authorizations. The limit is equivalent to less than 10% of the company’s registered share capital and combined votes conferred by the shares. The authorization includes the right to acquire shares in a manner other than in proportion to the shareholders’ holdings. As of June 30, 2006, the authorization had not been exercised. The Annual General Meeting on March 28, 2006 authorized the Board of Directors to decide, within one year of the meeting, on the relinquishment in one or


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several instalments of the company’s own shares acquired for the company, but placed a limit of 4,422,081 on the maximum number of shares to be relinquished. The limit is equivalent to less than 10% of the company’s registered share capital and combined votes conferred by the shares. The authorization includes the right to relinquish shares in a manner other than in the proportion to the shareholders’ pre-emptive rights to acquire the company’s own shares. As of June 30, 2006, the authorization had not been exercised. Notifications On May 22, 2006, Oy Herttakuutonen Ab reported that its share of Talentum’s share capital and voting rights had fallen below one tenth (1/10) through a transaction conducted on May 19, 2006. On May 22, 2006, Oy Herttaässä Ab reported that its share of Talentum’s share capital and voting rights had reached one tenth (1/10) through a transaction conducted on May 19, 2006. Liquidity providing agreement An agreement with Nordea Securities Plc on liquidity providing for Talentum Oyj shares became effective on June 21, 2004. Under the agreement, Nordea Securities submits purchase and sale offers so that the maximum differential between them is 3% of the purchase offer. The offers will include a minimum of 2,500 shares. - The forecasts and estimates presented here are based on the management’s current view of economic trends. The actual results may differ considerably from those expected at this time. -


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INCOME STATEMENT 4-6/2006 4-6/2005 1-6/2006 1-6/2005 1-12/2005 1000 EUR Net sales 30 245 25 171 61 170 49 137 103 289 Operating profit(adjusted) *) 711 2 695 2 967 4 590 20 447 Financial income and expenses -165 -347 -211 -487 -741 Share of profit of associates 135 111 188 120 239 Adjusted profit before tax *) 680 2 459 2 944 4 223 19 945 Operating profit on discontinued operations 0 -752 0 -472 -11 231 Profit before tax 680 1 707 2 944 3 751 8 715 Income tax expense -7 -457 -557 -981 -1 556 Profit after tax - ongoing activities 673 1 251 2 387 2 770 7 158 Discontinued operations 0 490 0 217 11 500 Profit for the period 673 1 741 2 387 2 988 18 658 Attributable to: Equity holders of the parent 428 1 435 1 961 2 711 17 868 Minority interest 245 306 426 277 789 Earnings per share (EUR) 0.01 0.03 0.05 0.06 0.42 Earnings per share, ongoing operations (EUR) 0.01 0.03 0.05 0.06 0.16 Earnings per share, discontinued operations (EUR) 0.00 0.00 0.00 0.00 0.26 *) Including discontinued operations Tax on the profit for the period under review is calculated according to Group’s estimated average tax rate for 2006.


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BALANCE SHEET 1000 EUR 30.6.2006 30.6.2005 31.12.2005 ASSETS Non-current assets Intangible assets 12 120 2 589 12 135 Goodwill 25 267 16 888 24 792 Tangible assets 8 389 8 847 7 754 Investments in associates 2 731 1 270 1 389 Deferred income taxes 3 727 5 392 3 458 Other long term receivables and investments 1 195 694 1 375 Total non-current assets 53 429 35 680 50 903 Current assets Inventories 2 991 2 748 3 469 Trade receivables and other receivables 14 808 18 032 13 407 Cash and cash equivalents 22 590 20 987 22 677 Total current assets 40 389 41 767 39 553 TOTAL ASSETS 93 818 77 447 90 456 SHAREHOLDERS' EQUITY AND LIABILITIES Shareholders' equity Share capital 18 594 17 891 18 594 Share premium reserve 5 896 167 5 896 Own shares -1 314 -1 314 -1 314 Fair value reserve and other reserves 4 15 4 Exchange differences 241 85 -44 Retained earnings 4 845 -928 254 Net income 1 961 2 711 17 868 Total 30 227 18 627 41 259 Minority interest 1 964 8 390 2 043 Total equity 32 192 27 017 43 302 Long term debt 8 087 6 767 8 522 Short term debt 53 540 43 663 38 632 SHAREHOLDERS' EQUITY AND LIABILITIES

93 818 77 447 90 456

Interest bearing debt 30 547 25 683 15 555


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CASH FLOW STATEMENT 1-6/2006 1-6/2005 1-12/2005 1000 EUR Profit for the period 2 387 2 988 18 658 Adjustments 2 292 3 237 -5 309 Change in working capital 2 473 -387 -3 392 Net financial items and taxes -1 136 -888 -1 727 Net cash from operating activities 6 016 4 950 8 230 Acquisitions of subsidiaries and associates -3 765 -5 161 -11 903 Purchase of other non-current assets -2 482 -1 422 -3 225 Other investments -1 434 -1 876 -1 772 Sales of subsidiaries 0 17 770 Sales of other non-current assets 306 287 461 Net cash used in investing activities -7 375 -8 172 1 331 Change in short term loans 16 000 8 000 -2 000 Change in long term loans -1 197 -3 675 -4 710 Payment of finance lease liabilities -92 -76 -174 Dividends paid and equivalents -13 431 -6 597 -6 620 Other financing items -8 -135 -74 Share repurchases 0 -1 724 -1 724 Net cash used in financing activities 1 272 -4 207 -15 302 Net change in cash and cash equivalents -87 -7 430 -5 741 Cash and cash equivalents at beginning of period 22 677 28 418 28 418 Cash and cash equivalents at end of period 22 590 20 987 22 677 Including discontinued operations: Cash flow from operating activities 250 628 Cash flow from investing activities -2 195 15 289 Cash flow from financing activities -1 544 -1 400


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INVESTMENTS 1-6/2006 1-6/2005 1-12/2005 1000 EUR Investments in non-current assets, ongoing activities 3 933 4 468 25 672 Investments in non-current assets, discontinued activities 0 1 252 2 876 Total 3 933 5 720 28 548 % of net sales 6.4 9.2 23.3 AVERAGE NUMBER OF EMPLOYEES 1-6/2006 1-6/2005 1-12/2005 Talentum Group **) 777 981 923 Part-time telemarketing staff 284 261 279 Total 1 061 1 242 1 202 **) Including employees of discontinued operations 308 222 CONTINGENT LIABILITIES 30.6.2006 30.6.2005 31.12.2005 1000 EUR Given as security 5 903 17 220 5 903 loans with securities as collateral 3 454 4 365 3 801 Rental and other commitments ***) 17 365 21 501 18 845 Leasing commitments ***) 2 776 3 579 2 492 ***) Including the commitments of discontinued operations 4 807 NUMBER OF SHARES Adjusted average number 42720075 42354126 42720075 Number at the end of period 44039817 42370176 44039817 KEY FIGURES Earnings per share, adjusted (EUR) 0.05 0.06 0.42 Earnings per share, ongoing activities (EUR) 0.05 0.06 0.16 Earnings per share, discontinued operations (EUR) 0.00 0.00 0.26 Equity per share (EUR) 0.69 0.44 0.94 Equity ratio, % 34.69 35.62 48.84


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STATEMENT OF CHANGES IN EQUITY

1000 EUR Equity

Share premium reserve

Fair value

reserve and

other reserves

Exchange differences

Retained earnings

Minority interest

Total equity

Equity 1.1.2005 17 863 -4 7 84 5 028 9 875 32 853 Share-based payments 54 36 90 Net income recognized directly in equity 8 63 2 73 Profit for the period 2 711 277 2 988 Purchase of treasury shares -1 031 -693 -1 724 Dividends paid -6 356 -241 -6 597 Issue of share capital 28 171 199 Other 1 -866 -865 Equity 30.6.2005 17 891 167 15 85 470 8 390 27 017 Equity 1.1.2006 18 594 5 896 4 -44 16 808 2 043 43 302 Exchange differences 285 285 Net income recognized directly in equity -64 -64 Profit for the period 1 961 426 2 387 Dividends paid -13 212 -219 -13 431 Other -286 -286 Equity 30.6.2006 18 594 5 896 4 241 5 493 1 964 32 192


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TALENTUM GROUP / SUB-SEGMENTS

12 rolling months

12 rolling months

1000 EUR 4-6/ 2006

4-6/ 2005

1-6/ 2006

1-6/ 2005

1-12/ 2005 7/05-6/06 7/04-6/05

Net sales Publishing 18 659 13 135 37 263 25 359 57 447 69 351 51 244 TV content production 5 931 5 545 11 872 11 382 21 499 21 989 22 873 Premedia 4 642 5 715 10 113 10 905 20 975 20 183 20 869 Direct marketing 2 154 1 944 4 233 3 616 7 163 7 780 6 716 Internet consulting ****) 0 7 317 0 13 126 19 717 6 591 24 324 Sales within group -1 142 -1 253 -2 312 -2 255 -4 027 -4 084 -4 009 Total 30 245 32 403 61 170 62 133 122 774 121 811 122 017 -Discontinued operations 0 -7 317 0 -13 126 -19 717 -6 591 -24 324 Adjustments and eliminations 0 85 0 130 232 102 179 Total 30 245 25 171 61 170 49 137 103 289 115 321 97 872 Operating profit Publishing 1 513 1 956 3 567 3 962 9 823 9 428 9 315 TV content production 549 113 845 217 628 1 256 115 Premedia -240 138 118 398 31 -249 1 019 Direct marketing 275 349 605 627 1 157 1 135 1 042 Internet consulting ****) 0 752 0 472 743 271 431 Parent company and group items -1 386 -612 -2 168 -1 086 -2 422 -3 504 -2 134 Capital gain on discontinued operations 0 10 488 10 488 0 Total 711 2 695 2 967 4 590 2 0447 18 824 9 788


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PUBLISHING BY GEOGRAPHICAL AREA

1000 EUR 4-6/2006 4-6/2005 1-6/2006 1-6/2005 1-12/2005 Net sales Finland 12 844 13 000 26 117 25 133 51 241 Other 5 815 135 11 146 226 6 206 Total 18 659 13 135 37 263 25 359 57 447 Operating profit Finland 1 069 1 937 2 940 3 952 8 888 Other 444 19 627 10 935 Total 1 513 1 956 3 567 3 962 9 823

AVERAGE NUMBER OF EMPLOYEES 1-6/2006 1-6/2005 1-12/2005 Publishing 399 289 308 TV content production 96 108 102 Premedia 217 215 228 Direct marketing 333 306 326 Internet consulting ****) 0 308 222 Group administration 16 16 16 Total 1 061 1 242 1 202 ****) Discontinued operations, gross

This interim report has been drawn up according to the IFRS recognition and valuation principles. In drawing up this interim report, Talentum has applied the same accounting principles as in the financial statements for 2005, which contain a description of those principles. This interim report is unaudited. Talentum will publish an interim report for January-September on October 27, 2006. TALENTUM OYJ Harri Roschier CEO FURTHER INFORMATION Harri Roschier, CEO, tel +358 (0)20 442 4220 Kai Järvikare, CFO, tel +358 (0)40 342 4210 www.talentum.com COPIES TO Helsinki Stock Exchange Key media This report is published in Finnish and in English. In case of doubt the Finnish version is authoritative. BRIEFING A briefing will be held for analysts and the media today, July 21, 2006, at 13.00 at the Talentum head office, Annankatu 34-36 B, Kamppi, Helsinki. The interim report will be presented by CEO Harri Roschier, and CFO Kai Järvikare will also be present.

Talentum Q2 2006 Interim Report

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Transcript of Talentum Q2 2006 Interim Report