Edipresse: Loss in the first half of the year - boosted by partial takeover

The French-speaking Swiss media group Edipresse posted a loss of CHF 3.2 million in the first half of the year. However, the figures are strongly influenced by the partial takeover by Tamedia. Because the Zurich-based publishing house Tamedia intends to gradually take over Edipresse's Swiss business by 2013, Edipresse has had to apply different accounting standards. For example, sales no longer include all products, only income from the international business (Eastern Europe, Spain and Asia), the luxury sector and Bilan magazine.
The remaining Swiss products that are being transferred to Tamedia - including the daily newspaper Le Temps - had to be reported separately. They suffered above all from the advertising slump. Turnover fell by 18 percent to CHF 173.6 million. If the two divisions are added together (on a pro forma basis), they generated sales of CHF 265 million. In the same period last year, the figure was CHF 385.3 million.
Edipresse also blamed the sale of its Portuguese activities in the first half of 2008 for the decline in sales. Currency effects also had a negative impact. On a pro forma basis, the operating result (EBITDA) amounted to CHF 11.7 million (previous year: CHF 35.4 million).

Forecasts difficult
Edipresse also announced that it is practically impossible to make reliable forecasts for both the second half of 2009 and 2010. The company will continue to focus on quality and innovative offerings and pursue the cost-cutting measures it has introduced. Edipresse thus hopes to return to profitability in 2010.

Step-by-step partial takeover by Tamedia
Tamedia intends to acquire 51.1 percent of Edipresse Switzerland for CHF 226 million in two stages by the beginning of 2011. The Zurich-based publishing house will then pay for the remaining shares at the beginning of 2013. Edipresse will not contribute its international magazine business to the marriage. The profitable western Swiss business magazine Bilan will be transferred to the international business.
The new Tamedia-Edipresse Group will be particularly strong in the daily print media. In addition to the free newspapers, the group combines twelve paid daily newspapers with a total circulation of 700,000 copies. The transaction still has to be approved by the Competition Commission (ComCo).