Meeting our EBIT guidance in a challenging year
Announcement no. 2-2023
8 February 2023
North Media’s Group CEO Lasse Brodt commented on the performance in 2022:
”FK Distribution and BoligPortal demonstrated robust results in a difficult year affected by challenging market conditions, increasing prices of paper, rising inflation, increased costs and reduced activity. The 6.3% decline in FK Distribution’s volumes was mainly a result of the economic slowdown, because at the same time, we experienced growing demand for special offers from consumers, and the leaflet channel demonstrated its worth in a retail market undergoing significant change. In Digital Services, BoligPortal delivered good results, while Ofir and Bekey both reported reduced earnings.”
Return on securities
Free cash flow
As revealed in Announcement no. 1 of 6 February 2023, North Media’s results were at the low end of the most recent FY 2022 guidance calling for revenue of DKK 995–1,010m and EBIT in the DKK 190–200m range. As the objective remains to pay stable and attractive annual dividends, the Board of Directors recommends a dividend of DKK 4 per share for the financial year.
Developments in 2022
North Media’s financial performance in 2022 was affected by macroeconomic developments and rising prices of paper, high inflation, declining consumer confidence and reduced activity in parts of the market. The Last Mile business area (FK Distribution) was severely affected by price increases for paper of up to 100%, which made a number of customers reduce their formats, lower their page counts or cut down on the frequencies of their leaflets and local newspapers. At the same time, leaflets and the minetilbud online platform proved to be important assets as the most efficient platforms to accommodate growing consumer demand for special offers in the grocery segment.
In the Digital Services business area, BoligPortal delivered satisfactory results that included double-digit growth and a record supply of listed rental units, signed leases and move-in/out inspection reports. After a good performance in the first half of the year, Ofir failed to win market share fast enough to offset a decline in the market. Bekey reported slight growth in its homecare business, but did not manage to build new customer groups.
Guidance for 2023
The 2023 guidance for the North Media Group as released on 6 February 2023 is specified per business area in the table below:
920 – 975
125 – 160
Last Mile (FK Distribution)
760 – 800
135 – 160
160 – 175
0 – 10
North Media expects revenue and EBIT for 2023 to be lower than the respective 2022 figures, the effect to be driven by both business areas. The wider guidance ranges reflect the uncertainty prevailing in terms of the high rate of inflation, rising interest rates, weak consumer confidence and the risk of an economic slump causing a drop in the level of activity in parts of society.
For FK Distribution, physical volumes are expected to come under pressure from high prices of paper and challenges faced by certain customer groups despite the fact that leaflets remain the key cornerstone of retail sector marketing. In order to ensure continued growth in its digital operations, North Media plans to strengthen the minetilbud.dk organisation, as well as its development, operations and data.
In the Digital Services business area, Ofir and Bekey are expected to report reduced EBIT on largely unchanged revenue as the Group will continue to invest to develop the businesses. BoligPortal is expected to deliver double-digit revenue growth once again and to increase earnings despite costs to develop and commercialise Boligmanager and to strengthen its Swedish site Bostadsportal.
Our CFO Kåre Wigh will present the interim report in a conference call (in English) on 9 February 2023 at 13:00 CET. Use this link to attend the conference call. The Annual Report will be presented in Danish on HC Andersen Capital’s platform on 9 February 2023 at 15:00 CET. Use this link to attend the presentation.
Lasse Brodt, Group CEO, tel. +45 20 24 32 92
CFO Kåre Wigh, tel. +45 25 65 21 45
North Media’s companies develop and operate platforms for transactions that bring businesses and consumers together, with a special focus on groceries, rental housing, jobs or digital access management solutions. FK Distribution is Denmark’s leading distributor of leaflets and local newspapers; it runs the digital platform ‘minetilbud’ and provides logistics services. BoligPortal is Denmark’s leading home rentals platform, offering services to both landlords and tenants. Ofir is Denmark’s most comprehensive jobs universe. Bekey provides digital access solutions for secured stairwells and private homes for the use of homecare services and companies delivering groceries, meal services, etc.