There is a need for explanation with regard to the sales figures. So far, the upturn in the economy has only been reflected in positive figures for Ringier in Switzerland and Germany. Here, the Zurich publishing house reported revenue growth of 11.8 percent, which was largely due to rising advertising revenues, as Marc Walder, CEO of Ringier Switzerland and Germany, explained. In the countries of Central Europe, Asia and also in the Swiss print business, however, Ringier continued to report declining sales. In these markets, the economic recovery is only now slowly becoming noticeable, said Unger.
Joint venture in Eastern Europe makes direct comparison difficult
The development of revenues, especially in Central Europe, is in any case hardly comparable with the previous year. This has to do with the 50:50 joint venture that Ringier and Axel Springer entered into a year ago in Poland, the Czech Republic, Slovakia, Hungary, and Serbia. However, this could not yet be fully implemented for antitrust reasons: No approval has yet been granted for Hungary, which is why Ringier's own activities in this country still appear fully consolidated in the current accounts. On the other hand, Ringier's country results for Serbia, Slovakia and the Czech Republic were only included in the accounts at 50 percent from mid-2010, but conversely half of Springer's business in Poland and the Czech Republic is consolidated in Ringier's accounts. Currency effects also had a major impact on Central European sales. All this led to a drop in sales of almost 20 percent in Central Europe, which in turn pushed total Group sales down by 2.5 percent. If these special circumstances were not taken into account, Group sales would be at about the same level as in 2009, says Unger.
Compensation payments from Axel Springer
The Ringier Axel Springer Media AG joint venture also had an impact on Group revenues in other respects - in the form of compensation payments from Axel Springer to Ringier. This is shown in the annual report. In other words, Ringier benefits from the joint venture not only in the long term through market expansion and joint market leadership in some countries, but also financially in the short term. What Unger also revealed to Werbewoche is that the Ringier Group, which is active in Romania and wants to stay there, wants to buy Edipresse's Romania business in addition. "Talks are currently underway," Unger said. Edipresse, however, is already involved in Romania with Axel Springer in a 70/30 joint venture - the main reason why Romania has so far been left out of Ringier Axel Springer Media AG. If Ringier were to succeed in acquiring the Edipresse share, however, the joint venture between Edipresse and Axel Springer could be dissolved - and nothing would stand in the way of integrating Romania into Ringier Axel Springer Media AG.
Online generates 20 percent of Swiss sales
The revenues in the individual segments show that the digital business recorded particularly strong growth, rising to CHF 130.1 million and now accounting for 10.3 percent of Group revenues. The situation is different at Ringier Switzerland and Germany, where digital business accounts for 13.4 percent of revenues: However, this only includes the transaction-based online business - specifically the revenues of the Scout24 Group or geschenkidee.ch. If revenues from app sales or advertising revenues on title websites are also included, digital revenues reach 20 percent, according to Marc Walder.
Construction site at Cash.ch, no worries with Bolero
In an interview with Werbewoche, Walder also said that Ringier only has one construction site left in Switzerland: Cash.ch. It was a challenge to monetize this business portal without print titles, he said. CashTV, on the other hand, is self-supporting on a small scale. Walder is not worried about the sharp drop in Bolero's readership. After the launch of SI Style, the women's title was positioned as a premium product for the upscale women - and in this target group, the readership figures "are not really decisive for the match," said Walder. In any case, the title is doing extremely well in the advertising market. Walder is generally very satisfied with the titles in Switzerland. Even L'Hebdo, TV8 and Illustré, which according to Wemf advertising statistics continue to show declining advertising volumes in the double-digit percentage range, are in fact "doing solidly to very well," he said. The self-declared minus figures in the statistics are due to EDP problems that have not yet been discovered, he said.
Ringier wants to expand the Energy brand
The CEO of Ringier Switzerland and Germany also commented on TV plans (the advertising week reported). And he reiterated once again that Ringier would be interested in expanding the Radio Energy brand beyond Zurich and Bern to other Swiss regions in the entertainment sector - especially to Basel and Central Switzerland. However, an attempt to bring Christian Heeb's Radio Basel onto the NRJ track failed last year. Walder left open the question of how to proceed. There are plans, but they are not yet ready to be announced, he said. Since, by law, a maximum of two FM stations can be owned in Switzerland, Ringier can only consider cooperative ventures or even minority holdings.
Markus Knöpfli
Ringier in figures (in CHF million)
2010 2009 Change in %
Group sales 1263.9 1296.1 - 2.5
- Sales CH + D 613.7 548.9 + 11.8
- Sales Central Europe 336.4 418.8 - 19.7
- Sales Asia/Pacific 50.3 52.0 - 3.2
- Sales Print CH 263.5 276.4 - 4.6
Net income 61.8 17.2 +359.8
Cash flow 161.1 93.8 + 71.8
Number of employees 7752 7448 + 4.1