AS Ekspress Grupp: Consolidated unaudited interim report for Q4 and 12 months of 2024

The revenue of AS Ekspress Grupp for the 4 thquarter of 2024 increased by 10% year-over-year to EUR 23.5 million and EBITDA increased by 23% to EUR 5.2 million. The revenue for the 12 months of 2024 increased by 4% to EUR 76.2 million and EBITDA increased by 4% to EUR 10.7 million. At the same time, digital revenue increased by 9% and as a result, the share of digital revenue made up 86% of the Group's total revenue in 2024. This exceeds the 85% target set for the share of digital revenue...

Tallinn, 21/02/2025 (informazione.news - comunicati stampa - editoria e media)

The digital subscription revenue and the number of subscribers of the Group's media companies increased strongly year-over-year in all three countries.  In a year, the Group received nearly 31 000 new digital subscriptions (+15%) in the Baltic States, totalling 238 000 subscriptions at the end of December 2024. The Group's digital revenue is thus increasingly based on digital subscription revenue and it makes up an increasingly larger recurring revenue base without the need for additional sales activity (and costs). We have enhanced the quality and volume of content offered by the Group's media companies in order to be the leader in the digital subscription field in all Baltic States. The Group is gradually moving towards its financial strategic goals and wishes to offer paid digital content to at least 340 000 subscribers by the year 2026.

The Group was also successful outside traditional media activities.  The revenue of ticket sales platforms increased by 21% in a year, growing especially strongly in the Latvian market. The outdoor screen business also demonstrated significant 26% growth supported by the extension of the network to 156 screens. With this, the Group has increased its presence in the Latvian market, where the number of screens increased from 98 to 109 in a year, while there are 47 screens in Estonia. These two areas have shown resilience also in the conditions of slower economic growth.

Successful sales of online advertising and digital subscriptions, and the volume growth of ticket sales platforms and digital outdoor screens have also helped to increase profitability. The net profit for the 4 quarter of 2024 totalled EUR 3.1 million which is EUR 0.6 million (25%) higher than last higher. This is slightly faster than the EBITDA's 23% growth rate. At the same time, the Group's net profit for 12 months totalled EUR 3.3 million which is EUR 0.1 million (-3%) lower as compared to last year, although EBITDA increased by 4%. The decrease in the 12-month net profit was mainly influenced by higher interest rates due to the increase in Euribor and higher depreciation expenses related to the Group's investments.

In 2024, the Group continued to create value for its shareholders, paying out 1.85 million or 55% of the profit for the 2023 (6 euro cents per share) as dividends. This significantly exceeds the Group's minimum 30% dividend payout ratio. Despite active investments and dividend payments, the Group's liquidity position remained strong – at the end of 2024, the Group had available cash in the amount of EUR 9.0 million (2023: EUR 9.6 million). The Management Board considers it important to maintain liquidity reserves both for potential new acquisitions and for situations related to further cooling of the economy.

In 2024, Ekspress Grupp significantly expanded its activities in the conference business, making two important acquisitions. In July, Delfi Meedia acquired the business of Eesti Koolitus- ja Konverentsikeskus (the Estonian Training and Conference Centre) and in December, the Lithuanian subsidiary UAB Delfi acquired the conference company Kenton Baltic. These acquisitions support the Group's strategic goal of developing the conference business as a new revenue area that complements existing media activities and enables to find new synergies. By its nature, the conference business is content creation business and thus is a good match for the portfolio of Ekspress Grupp. The content produced at conferences can successfully be enhanced through the Group's strong media outlets. In addition, this field of activity strengthens the position of Delfi's brand among business customers and creates opportunities for new business relations and revenue.

The year 2024 led to significant changes in the governance of the Group and its subsidiaries. Erik Heinsaar started as the CEO of Delfi Meedia, the largest subsidiary of the Group. He previously successfully managed Õhtuleht Kirjastus. Heinsaar took over the company from the current CEO Argo Virkebau. The editor-in-chief of Õhtuleht, Martin Šmutov, became the Chairman of the Management Board of Õhtuleht Kirjastus. On 2 January 2025, Jānis Grīviņš who has more than 15 years of management experience in the field of media, digital marketing and technology, became the Chairman of the Management Bord of Delfi Latvia. On 30 January 2025, Lili Kirikal, who previously worked as a transaction advisor in audit companies and as the CFO of Sunly AS, became a new member of the Management Board and the CFO of the Group.

The economic environment of the Baltic States was difficult in the first nine months of 2024. It was characterised by low consumer confidence, conservative investment policies of businesses and changing tax policies of countries. This put pressure on both advertising revenue and subscriptions. However, under these conditions, the Group has been able to grow its digital revenue base and to maintain profitability. The challenges of the beginning of year included the high level of Euribor, which increased finance costs, and the overall slowdown in economic growth in the Baltic States. The Group had been prepared for these challenges, keeping a strong liquidity position and successfully focusing on digital revenue.

The Management Board is going to make a dividend distribution proposal from the net profit for 2024 together with the announcement of the convening of the General Meeting of Shareholders and in its proposal, will adhere to the previously approved dividend policy. The Group pays at least 30% of previous year's net profit out as dividends, provided that there are sufficient funds for core activities and making new strategic investments.

In the 4 quarter of 2024, the consolidated revenue totalled EUR 23.5 million (Q4 2023: EUR 21.3 million). The revenue for the 4 quarter increased by 10% year-over-year. The consolidated revenue for the 12 months of 2024 totalled EUR 76.2 million (12 months 2023: EUR 73.1 million). The revenue for the 12 months of the year increased by 4% as compared to the previous year. The growth is primarily attributable to the increase in digital subscription revenue as well as increase in the volume of ticket sales platforms and digital outdoor screens. The share of the Group's digital revenue in total revenue was 86% in the 12 months of 2024 (12 months 2023: 83% of total revenue). Digital revenue for the 12 months of 2024 increased by 9% as compared to the same period last year.

In the 4 quarter of 2024, the consolidated EBITDA totalled EUR 5.2 million (Q4 2023: EUR 4.2 million). EBITDA increased by 23% as compared to last year and the EBITDA margin was 22% (Q4 2023: 20%). The profitability received a boost from the successful sale of online advertising and digital subscriptions as well as the increase in the volume of ticket sales platforms and digital outdoor screens. In the 12 months of 2024, the consolidated EBITDA totalled EUR 10.7 million (12 months 2023: EUR 10.2 million). EBITDA increased by 4% as compared to last year and the EBITDA margin was 14% (12 months 2023: 14%).

The consolidated net profit for the 4 quarter of 2024 totalled EUR 3.1 million (Q4 2023: EUR 2.5 million), increasing by 25%. The consolidated net profit for the 12 months of 2024 totalled EUR 3.3 million (12 months 2023: EUR 3.4 million), decreasing by -3%. The decrease in 12 months net profit is primarily related to higher interest rates due to the increase in Euribor rates at the beginning of the year and higher depreciation expenses arising from the Group's investments.

In the 12 months of 2024, the cost of goods sold, marketing, and general and administrative costs totalled EUR 72.1 million (12 months 2023: EUR 67.4 million). Operating expenses increased by EUR 4.7 million (+7%) as compared to the same period last year. Labour costs increased the most, by EUR 1.2 million (+3%).

At the end of the reporting period, the Group had available cash in the amount of EUR 9.0 million and equity in the amount of EUR 58.4 million (51% of total assets). The comparable data as of 31 December 2023 were EUR 9.6 million and 56.5 million (53% of total assets), respectively. As of 31 December 2024, the Group's net debt totalled EUR 13.1 million (31 December 2023: EUR 10.6 million).

In the 12 months of 2024, the Group's cash flows from operating activities totalled EUR 10.2 million (12 months 2023: EUR 12.2 million).

In the 12 months of 2024, the Group's cash flows from investing activities totalled EUR -9.4 million (12 months 2023: EUR -3.9 million), of which EUR -4.6 million was related to the development and acquisition of tangible and intangible assets, demonstrating higher investments in products and technologies.

In the 12 months of 2024, the Group's cash flows from financing activities totalled EUR -1.4 million, of which EUR -1.8 million is the dividend payment to the shareholders of AS Ekspress Grupp (12 months 2023: EUR -6.2 million, of which EUR -1.0 million is the share buy-back and EUR -1.5 million is the dividend payment to the shareholders of AS Ekspress Grupp). The financing activities also include the net change in borrowings in the amount of EUR 2.2 million and lease liabilities in the amount of EUR -2.3 million.

At the regular general meeting of shareholders of AS Ekspress Grupp held on 3 May 2024, it was decided to pay a dividend of 6 euro cents per share in the total amount of EUR 1.8 million. Dividends were paid to shareholders on 22 May 2024.

Lili Kirikal
CFO
AS Ekspress Grupp
E-mail address: lili.kirikal@egrupp.ee

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