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Metro International S.A. is a Luxembourg limited-liability company
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METRO INTERNATIONAL S.A.: FINANCIAL RESULTS FOR THE FIRST QUARTER ENDED 31st MARCH 2008
21 April 2008
Luxembourg, 21st April 2008 - Metro International S.A. ("Metro") (MTROA, MTROB), today announced its financial results for the first quarter ended 31st March 2008. The Group's consolidated results have been prepared according to International Financial Reporting Standards (IFRS).
HIGHLIGHTS FOR Q1 2008
- Excluding closed/divested operations and Bostad, operational sales decreased by 3.1% to € 69 million (2007: € 71.2 million). In real terms adjusting for the effect of the USD depreciation the sales drop is 1.6%
- Total net sales decreased by 6.1% to € 73.4 million (2007: € 78.2 million).
- The operating loss was € 5.6 million (2007: € 8.8 million loss) an improvement of €3.2 million
- The contribution from subsidiary newspaper operations was an operating loss of € 0.4 million (2007: € 3.2 million loss).
- Metro International achieved a net loss of € 6.4 million (2007: net loss € 10.8 million) an improvement of €4.4 million
- In nine of our controlled operations Metro lost up to 3 publishing days in March 2008 due to the Easter holidays - this lost sales of close to €2m compared to Q1 2007
- Now that Metro reports in Euros, translation differences are restricted to the non-European businesses. Year-on-year the currency fluctuations increase or decrease the reported revenues as follows - US and Hong Kong revenues are reduced by 12%; Chile revenues are inflated by 8%
- Metro has arranged a new € 50 million bank facility with a consortium of banks consisting of Nordea, Handelsbanken and Calyon.
- The net loss per share for the first quarter 2008 was € 0.01 (EUR 0.02)
- A Nomination Committee of major shareholders in Metro has been convened in accordance with the resolution of the 2007 Annual General Meeting. The Nomination Committee is comprised of Cristina Stenbeck on behalf of Investment AB Kinnevik and Emesco AB, Annika Andersson on behalf of the 4th AP Fund and Björn Björnsson on behalf of Harald Lundén Kapitalförvaltning, who together represent more than 50% of the voting rights in Metro.
Per Mikael Jensen, Chief Executive Officer of Metro International, said:
"The 1st quarter 2008 has delivered much better results than the same period last year.
On a like-for-like basis, excluding divested and closed operations, Metro's operational sales declined by 3.1% year-on-year. In real terms, after adjusting for the depreciation of the US dollar, sales declined by 1.6% but the Metro International group improved EBIT by €3.2 million compared to the 1st quarter 2007.
Difficult market conditions, especially in Spain, Denmark and the US put pressure on ad volumes and prices but tough actions on costs are helping to mitigate the impact of the economic downturn being experienced in some markets.
Excluding Bostad, the divested Czech operation (now reported as a JV) and the closed Polish operation, comparable operational sales decreased by 3.1% in Q1 year-on-year. Sales growth was delivered in Sweden (comparable basis), Holland, France, Portugal, Greece, Chile and Hong Kong. Growth was especially strong in January and February but was reduced in nine countries in March due to fewer publishing days because of the Easter holidays. On the whole, sales indications for April are good.
Sweden Green Metro continues its progress towards higher profitability with strong double-digit sales growth in January and February followed by a slight drop in March due to fewer publishing days during Easter. Bostad improved its EBIT performance over 2007 by more than € 1 million.
Holland maintained its margins on the back of sales growth of 11% in the 1st quarter. This helped to increase the quarterly EBIT by 16% year-on-year.
Denmark's EBIT declined by € 0.7 million due to competitive pressures on ad prices that reduced sales by 12% in Q1 2007 but continues to generate profit.
France, Portugal and Greece all delivered good sales growth especially in January and February. Every Southern European country experienced a drop in sales in March due to Easter. Good double-digit sales growth in Italy in January and February was effectively cancelled out by a drop in sales in March. Despite a € 1 million EBIT improvement in France, Southern Europe's EBIT is down by € 1.1 million mainly due to the poor result in Spain.
Sales in Spain remain a concern and were down 19% in the first quarter following a very disappointing March, despite solid growth in January and February, the EBIT has consequently declined. The reasons behind the sales decline are a combination of the Easter holidays and the Spanish general election both of which occurred in March. Competition in the market remains strong and the focus is to improve Metro's performance.
Chile generated real growth of 1% in Q108 despite the Easter effect and EBIT has increased year-on-year against 2007. Margins increased to above 20%.
Hong Kong's real sales growth was 3% for the 1st quarter. Sales are lower in February (Chinese new Year) and March (Easter holiday effect) but due to cost savings the EBIT impact is minimal and Hong Kong continues to deliver strong double digit margins.
US EBIT in Q108 was €0.2m better than in the same period in 2007 despite a 5.7% real drop in sales. Cost reductions have allowed the US operations to weather the current economic turbulence without any significant impact on the bottom line. However, cost control and sales growth are still top priorities.
Our joint venture operations have delivered an additional € 0.5 million EBIT in Q1 based on better results in all JV operations. Year-on-year Mexico's sales have more than doubled and in Canada sales have increased by 23%.
HQ and Other costs are slightly lower than Q1 2007. On 24th March the global website concept was launched in France. Performance statistics will be issued in due course but the website is enjoying a good response and is meeting expectations.
Per Mikael Jensen
CEO & President
Metro International
For further information, please visit www.metro.lu, email info@metro.lu or contact:
Per Mikael Jensen, CEO & President tel: +44 (0) 20 7016 1300
Frank Mooty, CFO tel: +44 (0) 20 7016 1300
Birgitta Henriksson, IR contact tel: +46 (0) 708 12 86 39
ABOUT METRO INTERNATIONAL AND METRO
Metro is the largest international newspaper in the world. Metro is published in over 150 major cities in 21 countries across Europe, North & South America and Asia. Metro has a unique global reach - attracting a young, active, well-educated Metropolitan audience of over 20 million daily readers. Metro's advertising sales have grown at a compound annual rate of 38% since the launch of the first edition in 1995.
Metro International 'A' and 'B' shares are listed on the OMX Nordic Exchange's Nordic List under the symbols MTRO SBD A and MTRO SBD B.
CONFERENCE CALL
The company will host a conference call today at 10.00 (CET). The call will also be webcast on Metro's website at www.metro.lu. To participate in the conference call, please dial in on the following numbers:
UK / International: +44 (0)20 3043 2436
Sweden: +46 (0)8 505 598 53
US (free phone): +1 866 458 40 87
A replay facility will be available shortly after the conclusion of the call at www.metro.lu
The full report with tables can be downloaded from the following link: