Ringier manages to stay in the class
The Bottom Line: Abroad, Switzerland’s largest media company stepped on the gas. At home, it hit the brakes on costs.
Balance sheet Switzerland's largest media company stepped on the gas abroad. What some industry observers were already predicting for 2002 did not materialize last year either: Ringier is still the only major publisher in the billionaires' league despite its second consecutive decline. In the current financial year, however (after -2.1% in 2003), only a maximum of one minus percent is possible, otherwise the relegation to the sales millionaires will be serious.the geographical shift in Ringier's sources of income has become even more accentuated. The Swiss contribution to the surprisingly pleasing result is just under
10 percent has not shrunk nearly as rapidly as the Eastern European business has grown in the same period, namely by over a third. Since 2001, however, the proportion of sales generated in Germany has fallen continuously from 82.7% to a new record low of 73.2%.
If this pace of internationalization is maintained, every second franc is likely to come from Slovakia, the Czech Republic, Hungary, Romania and Serbia as early as 2006. Michael Ringier probably wants to "push the investments in 2004 and 2005, which skyrocketed last year due to foreign acquisitions, well below the cash flow level" (see interview on page 29). Nevertheless, he considers the above time horizon for the first fifty-fifty balance sheet to be "not unrealistic".
No joy in the printing sectorIn addition to the further decline in circulation and advertising revenues at almost all major Swiss newspapers and magazines in 2003, the publisher is particularly concerned about the local printing sector, where sales fell by 12.7 percent. According to Group CEO Martin Werfeli, the closure of the Winterthur printing plant in December contributed significantly to this decline. In contrast to newspaper printing, customer printing also suffered from persistent overcapacity and the resulting fall in prices.
The usual outlook at this year's balance sheet presentation was cautious to sobering. According to Werfeli, the much-vaunted upturn in the domestic advertising market is still a long time coming. "Our commitments in Central and Eastern Europe, on the other hand, should benefit from EU accession."
Oliver Classen
10 percent has not shrunk nearly as rapidly as the Eastern European business has grown in the same period, namely by over a third. Since 2001, however, the proportion of sales generated in Germany has fallen continuously from 82.7% to a new record low of 73.2%.
If this pace of internationalization is maintained, every second franc is likely to come from Slovakia, the Czech Republic, Hungary, Romania and Serbia as early as 2006. Michael Ringier probably wants to "push the investments in 2004 and 2005, which skyrocketed last year due to foreign acquisitions, well below the cash flow level" (see interview on page 29). Nevertheless, he considers the above time horizon for the first fifty-fifty balance sheet to be "not unrealistic".
No joy in the printing sectorIn addition to the further decline in circulation and advertising revenues at almost all major Swiss newspapers and magazines in 2003, the publisher is particularly concerned about the local printing sector, where sales fell by 12.7 percent. According to Group CEO Martin Werfeli, the closure of the Winterthur printing plant in December contributed significantly to this decline. In contrast to newspaper printing, customer printing also suffered from persistent overcapacity and the resulting fall in prices.
The usual outlook at this year's balance sheet presentation was cautious to sobering. According to Werfeli, the much-vaunted upturn in the domestic advertising market is still a long time coming. "Our commitments in Central and Eastern Europe, on the other hand, should benefit from EU accession."
Oliver Classen
