Annual Report • Apr 13, 2017
Annual Report
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| Preface by Rik De Nolf | 5 |
|---|---|
| Events in 2016 by Xavier Bouckaert | 7 |
| Mission & strategy | 11 |
| Roularta as technological innovator | 12 |
| Environment, prevention and well-being | 14 |
| The Roularta Media Group share | 17 |
| Consolidated key figures | 20 |
| Group structure | 24 |
| Board of directors and management team | 26 |
| Annual report of the board of directors | 29 |
| Corporate governance declaration | 36 |
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
51 | |
|---|---|---|
| Note 1 | Significant accounting policies | 51 |
| Note 2 | Segment reporting | 60 |
| Note 3 | Sales | 63 |
| Note 4 | Services and other goods | 64 |
| Note 5 | Personnel charges | 64 |
| Note 6 | Write-down of inventories and receivables |
65 |
| Note 7 | Other operating income / expenses | 65 |
| Note 8 | Restructuring costs and other non-recurring results |
66 |
| Note 9 | Net finance costs | 67 |
| Note 10 | Income taxes | 68 |
| Note 11 | Discontinued operations | 70 |
| Note 12 | Earnings per share | 71 |
| Note 13 | Dividends | 71 |
| Note 14 | Intangible assets and goodwill | 72 |
| Note 15 | Property, plant and equipment | 77 |
| Note 16 | Investments in associates and joint ventures |
79 |
| Note 17 | Available-for-sale investments, loans and guarantees |
82 |
| Note 18 | Trade and other receivables | 83 |
| Note 19 | Deferred tax assets and liabilities | 85 |
| Note 20 | Inventories | 86 |
| Note 21 | Short-term investments, cash | 87 | |
|---|---|---|---|
| Note 22 | and cash equivalents Equity |
88 | |
| Note 23 | Share-based payments | 88 | |
| Note 24 | Provisions | 90 | |
| Note 25 | Significant litigations | 91 | |
| Note 26 | Non-current employee benefits | 92 | |
| Note 27 Note 28 |
Financial debts Other notes on liabilities |
95 96 |
|
| Note 29 | Finance and operating leases | 98 | |
| Note 30 | Contingent liabilities and | 99 | |
| contractual commitments for | |||
| the acquisition of property, plant | |||
| and equipment | |||
| Note 31 | Financial instruments - | 99 | |
| risks and fair value | |||
| Note 32 | Cash flow relating to acquisition | 104 | |
| of subsidiaries | |||
| Note 33 | Cash flow relating to disposal | 106 | |
| of subsidiaries | |||
| Note 34 | Interest in associates | 108 | |
| and joint ventures | |||
| Note 35 | Events after the balance sheet date | 108 | |
| Note 36 | Fees to the auditor and to persons | 108 | |
| related to the auditor | |||
| Note 37 | Related party transactions | 109 | |
| Note 38 | Group companies | 111 |
| STATUTORY AUDITOR'S REPORT | 114 |
|---|---|
| STATUTORY ANNUAL ACCOUNTS | 117 |
| Facts & figures | 120 |
| The places | 122 |
| Financial calendar | 124 |
It's a question being asked by all who have anything to do with the media. Roularta, however, believes that the question should rather be one of adaptation, evolving and taking account of the digital world. Without, in the process, losing sight of our essence. We are there for consumers who wish to receive relevant information, and for brands and retailers who wish to communicate effectively with other actors in the business and with consumers.
High quality content is the work of strong editorial teams that professionally develop websites, newspapers, radio and television. They must provide interesting information, find the right themes and original approaches, make thorough analyses and prepare useful dossiers that respond to the questions that people are asking themselves today. The result must always be relevant and exclusive, and it must surprise. We must do more than present the news. We must create news ourselves and even offer solutions. This binds us to an interested audience. They are members of a community that is in touch with what's important in all areas of life: social issues, politics, economics, but also culture and lifestyle. They are subscribers and members of the club. They have their newspaper delivered to their home and also read it digitally, they inform themselves with text, sound and images via our websites.
A Roularta specialty is the business of Roularta Local Media, an organisation that has been committed to the efficient marketing of local, regional and national advertisers for more than sixty years. Roularta's advertising consultants have put numerous companies on the map and guided them in their expansion. They help to organise campaigns and create ads that are able to reach all of the population in each region of Flanders with Deze Week (De Streekkrant) on Wednesday, and with De Zondag exclusively on Sunday. Today Roularta also makes it possible for advertisers to accomplish their goals on the internet. Roularta Local Media
2016 was a year of rapid change on all fronts. Selfdriving cars. The rise of robots. The disruption in many economic sectors – a disruption that continues to accelerate due to the influx of start-ups. The global breakthrough of e-commerce and m-commerce. The dominance of large, mostly American, tech companies. ll e on The
creates websites and web shops, and provides visitors and customers through Google and Facebook, via websites (Proxistore) and electronic newsletters (Proxiletter). Together they make up a complete package of 'Digilocal' services, with as icing on the cake 'Storesquare', the platform that makes it possible for everyone to immediately increase sales via e-commerce.
Changes in the media sector have also been underway for some time. The pace of these changes will continue to increase in 2017 and beyond. Advertisers are still searching for the ideal media mix, and readers are making increasing use of digital reading experiences, which of course makes predictions difficult. This has been the case for several years now, and the coming years will be no different. It is a reality that we have to accept, but which in itself is not harmful. On the contrary, it requires us to be even more innovative and creative, and to respond much quicker to events. Innovative, creative, bold: these qualities will be crucial in the coming years in ensuring the growth of Roularta. e stly so e yond. and reading predictions eral ent. in not s ve, ta Media Group
Roularta has been busy for several decades with the digitisation of its production and marketing systems. From the start of the Belgian news magazines – more than forty years ago – we have specialised in subscription recruitment and big data. And Roularta has continued to innovate all this time. We have consistently been a pioneer in the digital domain, and today we are well-equipped for the future.
2016 was the first full year for Roularta Media Group without the loss-making French operations. Thus we were able to focus on the future of our multimedia group without distraction. perations. of
At MEDIALAAN too we continue to innovate in radio and television. We are continuously launching new
'Multimedia' is more than ever central to Roularta Media Group's endeavour to be future proof. We are now active in all possible media: online, TV, radio, print, events, trade fairs, ... and we have even supplemented these activities with a new business – telecommunications – through the acquisition of Mobile Vikings by MEDIALAAN. ral to Roularta e are
models for delayed viewing, for viewing digitally over the internet and to create highly targeted digital advertising. Our strong radio brands are preparing for the transition to digital radio.
As a 'mobile virtual network operator', MEDIALAAN is also busy expanding into the world of telecom. The group's marketing power can provide an important new activity based on existing brands Jim Mobile and Mobile Vikings.
Roularta is evolving rapidly along the digital highway. With an in-house innovation unit and an efficient IT team responsible for developing our own systems for digital marketing with big data and e-commerce. With Roularta Mediatech Accelerator to guide start-ups and so on. All evidence of our shift in focus from investing in acquisitions, to investing in launches, in order to create new opportunities for the near future.
Roularta's digital activities did well in 2016.
The Roularta Mediatech Accelerator was launched in the autumn of 2016. This is a programme in partnership with Duval Union in which nine start-ups enjoy several advantages: a cash injection of 25,000 euros, media exposure valued at 200,000 euros, and guidance by internal and external mentors. In return, Roularta acquires a 5% participation in the capital of these start-ups. This project fits well with Roularta's innovation strategy.
Red Nose Day, MEDIALAAN'S charity campaign, turned out to be a great success in 2016. 2016 was indeed a successful year for MEDIALAAN:
Our 100% in-house television channels Kanaal Z/ Canal Z achieved good ratings in 2016, with 565,000 viewers on a daily basis (CIM audimeter 2016). Here we see that extra programmes funded by partners – both existing and many new ones that we launched in 2016 – had a positive effect on revenue. Only commercials lagged behind. Which is why we have changed media agencies. RTVM, the national advertising media agency for regional broadcasters, will now market the KZ/CZ spots.
After more than 50 years, De Streekkrant/ De Weekkrant was renamed 'Deze Week'. Deze Week is an attractive and somewhat thicker newspaper with much more editorial work and a contemporary form. The new newspaper is distributed mainly door-to-door but also via displays. Thus Deze Week is again a strong cornerstone in addition to our successful Sunday publication De Zondag and our lifestyle magazine Steps. This operation is necessary for the further expansion of 360° contact with customers: in print and online, and thus with Digilocal. 360 degree marketing is the only good direction for Roularta Local Media to take. There lies the future. No one else in Flanders is able to present such a range of offerings. We have a unique position.
Krant van West-Vlaanderen (KW) has launched a new promotional campaign. The (eleven) local editions were redesigned with more emphasis on local news. The provincial Krant van West-Vlaanderen will be published in magazine format. And will include new initiatives such as 'Kwesties' with which readers can compile their own digital KW. In 2016, KW.be already managed to obtain more revenue from ads (8%).
After a record year in 2015, magazines performed less well in 2016. We had to contend with a decline in advertising revenue, particularly in the lifestyle and banking sectors. Partly due to the attacks in Brussels, the luxury sector was faced with declining consumption. The banking sector was again under pressure due to low interest rates. Revenue from subscriptions and newsstand sales of our magazines remained roughly stable.
We recently introduced a number of innovations:
online channels. In particular, we aim to identify more surfers at our news sites and to convert as many as possible into subscribers.
The line extensions had a good year. The cruises with new destinations were popular. Meanwhile, we ourselves organised seven cruises. The magabooks about deceased artists (Toots Thielemans, David Bowie, Prince, Leonard Cohen) sold well.
Our international magazine activities in a joint venture with Bayard remained stable. Plus Magazine in the Netherlands and Belgium again succeeded in attracting more subscribers in 2016. Plus Nederland now has a paid circulation of 231,000 copies. Thus it remains the largest monthly magazine in the Netherlands. In Germany, we see a stable market for our magazines and slightly decreasing advertising revenue for Plus Magazine.
Roularta HealthCare (publisher of among others Artsenkrant/Le journal du Médecin) had a less healthy start in 2016, but after a difficult first half of the year, the outlook brightened a bit in the second half. The pharmaceutical companies reduced their marketing budget significantly in 2016.
Trends Business Information remained stable in 2016 in a market that continues to be difficult and disruptive. The traditional players lost market share, while other smaller challengers disrupted the market. Trends Top successfully launched many special editions, the latest of which was the Trends Top Gazellen. An upgrade of the websites and an expansion of the databases are in the pipeline.
Roularta Printing had a busy year in 2016. The printing company managed to take over most of the printing work for the French magazines of Altice (which acquired the Roularta magazines in 2015) and to win new orders, of which The Economist and Playboy were the most extreme examples. An investment was also made in a brand-new flat-back binding machine so that we no longer need to outsource all magazines with a flat back, and thus are able to better serve our external customers.
As a multimedia company, Roularta Media Group (RMG) sets out to create value in a durable way for its readers, internauts, viewers, listeners, advertising customers, employees and shareholders.
In Belgium, Roularta is a dynamic and leading player in the publication and printing of news and niche magazines, newspapers and freesheets, in the audiovisual media landscape, in electronic publishing and in the field of digital marketing for the local advertiser.
For the general public in Dutch-speaking Belgium, RMG produces freesheets, open network TV, radio and the Vlan.be internet site. For the national market (in both Dutch and French) RMG produces quality magazines, a TV news station Kanaal Z/Canal Z and the content-rich news portals Knack.be and LeVif.be. In this way Roularta is constantly investigating new opportunities – titles, marketing initiatives and new media – to strengthen its leadership in Belgium.
In joint venture with the French group Bayard, Roularta is active in Belgium, the Netherlands and Germany with senior citizen magazines and in
Germany with a wide range of magazines for parents
and children, home & garden.
All the Group's strong brands are continuing to grow through line extensions, events and add-on products. A policy of vertical integration (content, advertising acquisition, production) and a multimedia approach increase flexibility and strengthen Roularta's anticyclical character.
RMG continues to innovate in the field of technical developments in the rapidly evolving media world. The involvement of its employees and the ongoing search for the best internal systems, cost management and synergy with partners help guarantee its future success.
Roularta Media Group is a company with a strong record of socially responsible entrepreneurship, in which integrity, customer-friendliness and commitment come first.
(*) Combined sales (with application of the proportional consolidation method for joint ventures, including Medialaan, Bayard,...).
RMG is part of the Google Digital News Initiative (DNI) Innovation Fund. At the end of February 2016, RMG was selected for the Metahaven project. From a total of 1,200 projects, coming from European publishers and other players of the digital news industry, Google chose 128 media projects from 23 European countries. With the Metahaven project, Roularta Media Group is part of the European top of the Google Digital News Initiative Innovation Fund.
The Metahaven project will enable Roularta Media Group to add enrichments/metadata to all media content and offer it to its readers in a pertinent and personalised manner by way of new digital services.
Roularta Media Group collaborates with Zeticon and the University of Leuven (Computer Science and Electrical Engineering departments). Zeticon and the University of Leuven provide the underlying technological innovation which Roularta Media Group will implement in its editorial systems.
RMG is part of MediaNet Vlaanderen (Flanders Media Network). To replace MIX, MediaNet Vlaanderen is working on an innovative business network (IBN). The network's three cornerstones are: efficient content production and distribution, more intelligent data and insights for better customer understanding, and also shared infrastructure and services. RMG will be participating in various of this network's activities.
In 2016 Roularta Media Group, in collaboration with Duval Union, launched the Roularta Mediatech Accelerator, a support programme for start-ups. RMG aims with this initiative to facilitate and accelerate innovation in the media sector.
Nine start-ups were selected that RMG will support and guide. Support by RMG includes funding and media for equity, housing and infrastructure, access to data, technology, know-how and mentorship.
The aim is to link the expertise of Roularta with the start-ups participating in the Roularta Mediatech Accelerator, and thus create a win-win situation that helps these start-ups achieve sustainable growth.
In 2016 Roularta set up its own innovation lab. This lab serves the internal business units by constantly searching for the latest technologies and methods that can benefit both the Group's internal business units and external customers. Technological developments move extremely fast, and customers expect the products and services to follow these recent developments. In this way Roularta aims to retain and even improve its current leading position in the market and (continue to) offer added value to its customers.
At editorial level too, Roularta Media Group is preparing for the future by using CCI NewsGate as a unique system for the entire newsroom, covering editors of Roularta Media Group, and with an emphasis on editorial planning, contract management and cross-media reuse of content.
NewsGate will enable the Roularta editorial staff to work 'multi-title' and 'multi-channel'. They can, from their editorial cockpit, create packages equally for print, web and smartphones and tablets.
Meanwhile, Roularta Media Group has already worked hard to create apps for a large portion of its titles. These apps are available for iOS, Android and Windows. Through continuous adaptation and through regular adjustments of these apps, RMG guarantees its readers the best possible user ex perience.
Roularta Media Group as a multimedia company is active in various high-tech sectors. Within these different areas the Group researches and develops new opportunities on an ongoing basis, giving Roularta in the process a solid international reputation as a major technology innovator.
Roularta Media Group's technological research and development efforts obviously benefit the Group's own internal work processes, but many times they are also the driving force behind decisive market developments.
In the field of premedia, Roularta Media Group has been the starting point for various Belgian and international standards. Roularta Media Group's pioneering role here is illustrated, among other things, by the following pioneering achievements.
As a founder member of Medibel+, the umbrella organisation of the Belgian advertising sector (www.medibelplus.be), Roularta Media Group several years ago achieved the breakthrough of the PDF file format as the standard for the delivery of digital ads to newspapers and magazines. Roularta Media Group continues to enhance its pioneer status at Medibel+: Erwin Danis, the RMG premedia director, is currently president of the organisation.
Roularta Media Group was behind the development of the AdTicket method for the digitisation of order workflow between the media buyers and creative agencies which produce the ads on the one side, and publishing companies on the other. Roularta Media Group and Medibel+ launched the AdTicket on the Belgian market. In addition, Medibel+ was developed to offer a platform for providing digital proofs of advertising to the mailboxes of advertisers. The digital platform is an efficient tool that allows customers to consult their advertisements via a practical browsing module. The digital platform also allows customers to receive and consult digital invoices in their mailboxes.
Under the guiding impulse of Roularta Media Group, Medibel+ was one of the founders in 2002 of the Ghent PDF Workgroup (GWG, www.gwg.org). This – now international – organisation of graphic associations and suppliers from Europe and the United States is seeking to introduce and increase the use of best practices in the printing industry worldwide. GWG is building here on the merits of Medibel+ and has taken over the Medibel+ PDF standards and the Medibel+ AdTicket method. Within the international GWG too, Roularta Media Group continues to assume its responsibility. With this project Roularta Media Group once again shows its technical innovativeness, and the working methods it has developed are being followed abroad.
Within the Ghent PDF Workgroup, RMG is also working, along with other international media groups, on new cross-media standards, processes and formats for publishing on smartphones and tablets. This takes place within the Cross Media Committee which examines the changes taking place in the world of cross-media publishing and the opportunities that these offer.
Roularta Media Group plays an important and innovative role in Flanders by participating and/or taking the lead in various technological and innovative projects.
Roularta Media Group made major efforts in 2016 to produce its various media in an environmentally and energy-friendly manner.
Roularta Media Group is the only Flemish printer to have signed up to the Flemish government's Energy Policy Covenant (EBO). This is the successor to the benchmark and audit covenant that expired at the end of 2015.
The EBO encourages energy-intensive undertakings to take a forerunner role in energy efficiency without jeopardising their competitiveness. By signing the EBO Roularta makes several commitments. In 2016, the EBO energy plan was accepted. Following on this, a first monitoring report was submitted.
With the execution of a gap analysis, in 2016 Roularta took the first step in the process of obtaining ISO 50001 certification. This standard specifies the procedures for energy management in companies and large organisations. The gap analysis identified the items to be targeted in 2017 in order to meet the ISO standard.
The environmental permit for the BMC site expires in April 2018. Since the application for renewal of the environmental permit must be submitted at least one year in advance, the preparatory work was started in 2016. As part of this application, among others an energy audit, a parking impact study and a mobility study were carried out. The latter was an occasion for Roularta to update its mobility
brochure. This brochure lists all Roularta branches, indicating how these sites can be accessed, among others by public transport. It discusses in detail the various transport options together with their advantages and disadvantages.
Roularta has long focused on transport and environmentally friendly mobility. Roularta, for example, participates in Blue-bike. For local travel after using public transportation, employees can use a 'blue bike' that they can pick up at the station and return in the evening. Blue-bike handles the maintenance of the bicycles and even offers free breakdown assistance. This ensures carefree trips, a bit of exercise during the day, and emission-free mobility!
Next to the print shop and unloading docks, there is an undeveloped plot of 5.61 ha. For its development, a choice was made for the creation of an agrarian landscape within an urban environment. The landscape includes slopes in the form of flower meadows, through which run several grass paths. The noise barrier was extended to the landscaped park. In 2016, the flower meadow zones were sown with Japanese oats which quickly provided good ground cover, but which also was good preparation for the flower meadows and for avoiding pioneer weeds. A meadow, rows of trees and a pool are also foreseen.
The choice of trees, flowers and native plants ensures a maximum food supply for all kinds of insects, birds, possibly bats,... The pool and shallow canals provide a breeding ground for amphibians.
A number of high-profile projects were undertaken in this area in 2016:
A ban on smoking at work was imposed over ten years ago and a general rule had been in place in the production area for much longer. Employees can now smoke only at specific locations outdoors.
In 2016, attention was given to the general rules. Diverse information about smoking was also distributed, ranging from the effect of smoking on the body, through information on the electronic cigarette, to possibilities for quitting smoking.
Roularta developed a substance policy in 2010. This includes the use of alcohol, drugs and medicines at work or during work-related hours. In 2016, these arrangements were examined to see if they were still up to date. An update of the arrangements is foreseen for 2017. Thus for example, the company doctor will review these items with employees during their medical examination.
The Royal Decree of 17 July 2014 laying down rules for the disclosure of certain substances or products that cause allergies or intolerances for non-prepackaged food is also applicable to 'company canteens'. All allergen information on the basic products in the canteens was collected. These data were recorded in a special computer program. Based on this 'database', dishes can be quickly created on a daily basis and an overview of the allergens present is available immediately. Those who suffer from allergies can also always ask the cooks to verify the ingredients in each dish.
The Royal Decree of 4 August 1996 establishes the protection of workers from risks related to exposure to biological agents at work. By 'biological agents' is meant microorganisms, cell cultures and human endoparasites that could cause an infection, allergy or intoxication. For Roularta this concerns hepatitis A and B, tetanus, Legionella,… This was earlier examined and worked out for each work station at Roularta. In 2016 this was updated and the necessary further approach was
In 2016, several fire prevention issues were addressed including an evaluation and expansion of the firefighting department, a comprehensive risk analysis in cooperation with the fire insurer, the coordination of work in our buildings by (sub)contractors, and actions that followed the inspection of the sprinkler pipes.
burnout 'Burnout' has been an increasingly prevalent phenomenon in our society in recent years. Unfortunately Roularta workers are also faced with this illness. Often we are surprised; we didn't see it coming. Furthermore, dealing with it remains a difficult task: assessing what you can best do to help a sick colleague, and what you can do to ensure a smooth and effective reintegration after burnout. To answer all of these questions, in 2016 Roularta organised specific training on the subject of burnout for management personnel. This training was held in collaboration with Provikmo, the external prevention consultant for psychosocial stress.
The registered capital of NV Roularta Media Group amounts to EUR 80,000,000.00. It is represented by 13,141,123 shares paid up in full, without par value, representing each an equal part of the capital.
All shares representing the registered capital have the same social rights.
In the course of the financial year 2016, the company did not purchase any own shares on the basis of the statutory authorisation of the board of directors.
On 31 December 2016 the company has 612,825 of its own shares in portfolio, representing 4.66% of the registered capital.
Shareholding structure The shareholding structure is as follows:
| The shareholding structure is as follows: | ||||||
|---|---|---|---|---|---|---|
| Number of shares |
% | |||||
| Koinon Comm.VA (1) | 7,480,325 | 56.92% | ||||
| S.A. West Investment Holding (1) | 2,022,136 | 15.39% | ||||
| Bestinver Gestión S.G.I.I.C. S.A. |
998,725 | 7.60% | ||||
| Own shares | 612,825 | 4.66% | ||||
| Individual and institutional investors |
2,027,112 | 15.43% | ||||
(1) The Comm.VA Koinon and the S.A. West Investment Holding, in their capacity as persons acting in concert who have concluded an agreement concerning the possession, the acquisition and transfer of shares, have made a definitive notification.
9,395,068 of the total number of outstanding shares are nominative.
In the context of the Law of 1 April 2007 concerning public takeover bids, Comm.VA Koinon, as the direct holder of more than 30% of the Roularta Media Group shares, updated its registration with the FSMA on 25 August 2014 pursuant to Article 74 §
Roularta Media Group's shares are listed on Euronext Brussels under the section Media - Publishing, ISIN Code BE0003741551 and Mnemo ROU.
The Roularta share is included in the BEL Small Cap Index (BE0389857146).
Volumes and closing prices in 2016
| Month | Average closing price |
Volumes | in EUR millions |
|---|---|---|---|
| Jan 16 | 24.291 | 124,337 | 3.06 |
| Feb 16 | 22.473 | 48,074 | 1.08 |
| Mar 16 | 23.497 | 55,100 | 1.30 |
| Apr 16 | 24.125 | 95,130 | 2.31 |
| May 16 | 24.685 | 21,188 | 0.52 |
| Jun 16 | 25.358 | 50,841 | 1.28 |
| Jul 16 | 24.621 | 29,060 | 0.72 |
| Aug 16 | 24.013 | 54,529 | 1.27 |
| Sep 16 | 23.282 | 216,472 | 4.97 |
| Oct 16 | 24.600 | 277,039 | 6.71 |
| Nov 16 | 25.164 | 65,286 | 1.64 |
| Dec 16 | 24.754 | 32,687 | 0.81 |
| 1,069,743 | 25.67 |
Volumes and figures in EUR millions - 2016
The highest price during 2016 was EUR 26.93 on 6 January.
The lowest price during 2016 was EUR 21.16 on 24 August.
The largest daily trading volume was 101,722 shares on 6 September 2016.
Roularta Media Group has a proactive investor relations policy, aimed at increasing the visibility of the share and in this way supporting its liquidity.
The general assembly pursues – as advised by the executive board – a policy which tries to pay out a dividend, whilst keeping a close watch on preserving the healthy balance between a distribution of dividends and the investment possibilities. The general assembly of 16 May 2017 will propose to pay out a gross dividend of EUR 0.50 per share for 2016.
Roularta Media Group was founded on 11 May 1988 as Roularta Financieringsmaatschappij. The table on the following page lists the events that since then have affected the company's capital and the securities representing it.
.
| Year Month | Transaction | Number of shares |
Capital BEF / | EUR | |
|---|---|---|---|---|---|
| 1988 May | Foundation as Roularta Financieringsmaatschappij | 12,510 | 381,000,000 BEF | ||
| 1993 July | Merger - capital increase | 13,009 | 392,344,000 BEF | ||
| 1997 December Split - capital increase | 18,137 | 546,964,924 BEF | |||
| 1997 December Merger - capital increase | 22,389 | 675,254,924 BEF | |||
| 1997 December Capital increase | 24,341 | 734,074,465 BEF | |||
| 1997 December Name changed into Roularta Media Group | |||||
| 1998 June | Issue of 300,000 warrants - amendment of articles of association | 2,434,100 | 734,074,465 BEF | ||
| 1998 June | Merger - capital increase | 2,690,400 | 1,545,457,541 BEF | ||
| 1998 June | Contribution of debt receivable - capital increase | 8,277,700 | 2,496,457,541 BEF | ||
| 1998 December Contribution of debt receivable - capital increase | 9,611,034 | 4,479,791,791 BEF | |||
| 2001 June | Conversion of capital into euros - capital increase by conversion of 61,950 warrants |
9,672,984 111,743,000.00 EUR | |||
| 2001 October | Destruction of 119,305 own shares | 9,553,679 111,743,000.00 EUR | |||
| 2002 June | Capital increase by conversion of 35,350 warrants | 9,589,029 112,138,000.00 EUR | |||
| 2003 June | Capital increase by conversion of 43,475 warrants | 9,632,504 112,623,000.00 EUR | |||
| 2003 July | Capital increase by contribution in kind | 9,884,986 118,463,000.00 EUR | |||
| 2004 June | Capital increase by conversion of 43,625 warrants | 9,928,611 118,950,000.00 EUR | |||
| 2005 June | Capital increase by conversion of 28,350 warrants | 9,956,961 119,267,000.00 EUR | |||
| 2006 January | Capital increase by conversion of 39,090 warrants | 9,996,051 120,054,000.00 EUR | |||
| 2006 February | Capital increase by contribution in cash | 10,985,660 131,939,204.09 EUR | |||
| 2006 May | Incorporation of an issue premium | 10,985,660 170,029,300.00 EUR | |||
| 2006 June | Capital increase by conversion of 19,825 warrants | 11,005,485 170,250,500.00 EUR | |||
| 2007 January | Capital increase by conversion of 9,340 warrants | 11,014,825 170,439,000.00 EUR | |||
| 2007 June | Capital increase by conversion of 22,225 warrants | 11,037,050 170,687,000.00 EUR | |||
| 2008 January | Capital increase by conversion of 7,864 warrants | 11,044,914 170,846,000.00 EUR | |||
| 2008 May | Capital increase by conversion of 17,375 warrants | 11,062,289 171,040,000.00 EUR | |||
| 2008 December Capital increase by contribution in cash | 13,131,940 203,040,000.00 EUR | ||||
| 2011 January | Capital increase by conversion of 9,183 warrants | 13,141,123 203,225,000.00 EUR | |||
| 2015 May | Capital decrease | 13,141,123 80,000,000.00 EUR | |||
| 2015 June | Merger - Roularta Media Group NV with Roularta Printing NV, Biblo NV, De Streekkrant - De Weekkrantgroep NV, Euro DB NV, Le Vif Magazine SA, New Bizz Partners NV, Press News NV, Regie De Weekkrant NV, Roularta Business Leads NV, Roularta IT-Solutions |
13,141,123 80,000,000.00 EUR |
NV, Roularta Publishing NV and West-Vlaamse Media Groep NV
Analysts who follow the Roularta share:
| - Petercam | Michael Roeg | [email protected] |
|---|---|---|
| - KBC Securities | Ruben Devos | [email protected] |
| Income statement | in thousands of euros | 2012 2013 (*) | 2014 | 2015 | 2016 | Trend | |
|---|---|---|---|---|---|---|---|
| Sales | 712,045 305,209 299,569 290,226 276,464 | -4.7% | |||||
| EBITDA (1) | 36,964 | 29,695 | 34,871 | 33,598 | 34,405 | +2.4% | |
| EBITDA - margin | 5.2% | 9.7% | 11.6% | 11.6% | 12.4% | ||
| EBIT (2) | 5,540 | 15,116 | 21,930 | 31,363 | 24,887 | -20.6% | |
| EBIT - margin | 0.8% | 5.0% | 7.3% | 10.8% | 9.0% | ||
| Net finance costs | -8,873 | -7,262 | -6,728 | -5,441 | -4,687 | -13.9% | |
| Operating result after net finance costs | -3,333 | 7,854 | 15,202 | 25,922 | 20,200 | -22.1% | |
| Income taxes | 1,128 | 1,924 | -2,492 | 46,089 | 72 | +99.8% | |
| Net result from continuing operations | -2,205 | 9,778 | 12,710 | 72,011 | 20,272 | -71.8% | |
| Result from discontinued operations | -68,268 -155,237 | -7,770 | 0 -100.0% | ||||
| Attributable to minority interests | -498 | -581 | -50 | -127 | -1,201 +845.7% | ||
| Attributable to equity holders of RMG | -1,707 | -57,909 -142,477 | 64,368 | 21,473 | -66.6% | ||
| Net result attributable to equity holders of RMG - margin | -0.2% | -19.0% | -47.6% | 22.2% | 7.8% |
| Balance sheet | in thousands of euros | 2012 2013 (**) restated |
2014 | 2015 | 2016 | Trend | |
|---|---|---|---|---|---|---|---|
| Non-current assets | 604,675 | 585,039 | 271,778 | 319,007 | 307,445 | -3.6% | |
| Current assets | 333,761 | 200,827 | 261,376 | 130,674 | 135,756 | +3.9% | |
| Balance sheet total | 938,436 | 785,866 | 533,154 | 449,681 | 443,201 | -1.4% | |
| Equity - Group's share | 344,689 | 287,053 | 143,277 | 207,649 | 222,293 | +7.1% | |
| Equity - minority interests | 12,266 | 11,415 | 2,475 | 1,868 | 1,762 | -5.7% | |
| Liabilities | 581,481 | 487,398 | 387,402 | 240,164 | 219,146 | -8.8% | |
| Liquidity (3) | 1.1 | 0.9 | 1.2 | 1.1 | 1.4 | +27.3% | |
| Solvency (4) | 38.0% | 38.0% | 27.3% | 46.6% | 50.6% | +8.6% | |
| Net financial debt | 69,535 | 80,423 | 82,027 | 75,680 | 57,443 | -24.1% | |
| Gearing (5) | 19.5% | 26.9% | 56.3% | 36.1% | 25.6% | -29.1% |
(*) Restated for retrospective application of IFRS 11 Joint Arrangements and application of IFRS 5 Discontinued Operations. (**) Restated for retrospective application of IFRS 11 Joint Arrangements.
(1) EBITDA = operating cash flow = EBIT + depreciations, write-downs and provisions.
(2) EBIT = operating result, including the share in the result of associates and joint ventures.
(3) Liquidity = current assets / current liabilities.
(4) Solvency = equity (Group's share + minority interests) / balance sheet total.
(5) Gearing = net financial debt / equity (Group's share + minority interests).
| restated | ||
|---|---|---|
(*) Restated for retrospective application of IFRS 11 Joint Arrangements and application of IFRS 5 Discontinued Operations.
(1) On the basis of the weighted average number of shares.
(2) Earnings = current net profit of the consolidated companies. For 2016 it is assumed that the current net profit equals net result.
| Printed Media | ||||||
|---|---|---|---|---|---|---|
| in thousands of euros | 2012 | 2013 (*) | 2014 | 2015 | 2016 | Trend |
| Sales | 541,693 | 327,992 | 319,491 | 308,130 | 295,220 | -4.2% |
| EBITDA (1) | 14,884 | 19,743 | 22,647 | 18,821 | 20,608 | +9.5% |
| EBITDA - margin | 2.8% | 6.0% | 7.1% | 6.1% | 7.0% | |
| EBIT (2) | -8,959 | 4,858 | 8,612 | 16,281 | 10,640 | -34.6% |
| EBIT - margin | -1.6% | 1.5% | 2.7% | 5.3% | 3.6% | |
| Net finance costs | -8,485 | -6,988 | -6,438 | -5,303 | -4,582 | -13.6% |
| Operating result after net finance costs | -17,444 | -2,130 | 2,174 | 10,978 | 6,058 | -44.8% |
| Income taxes | 2,799 | 551 | -4,505 | 44,639 | -786 | +101.8% |
| Net result from continuing operations | -14,645 | -1,579 | -2,331 | 55,617 | 5,272 | -90.5% |
| Result from discontinued operations | -68,269 -155,236 | -7,770 | 0 | -100.0% | ||
| Attributable to minority interests | -449 | -388 | -50 | -126 | -1,200 | +852.4% |
| Attributable to equity holders of RMG | -14,196 | -69,461 -157,517 | 47,973 | 6,472 | -86.5% | |
| Net result attributable to equity holders of RMG - margin |
-2.6% | -13.5% | -21.2% | 15.6% | 2.2% |
(*) Restated for retrospective application of IFRS 11 Joint Arrangements and application of IFRS 5 Discontinued Operations.
(1) EBITDA = operating cash flow = EBIT + depreciations, write-downs and provisions.
(2) EBIT = operating result, including the share in the result of associates and joint ventures.
Audiovisual Media
| restated | in thousands of euros | 2012 | 2013 (*) restated |
2014 | 2015 | |||
|---|---|---|---|---|---|---|---|---|
| Sales | 176,817 | 168,754 | 158,712 | 164,096 | 182,729 | |||
| EBITDA (1) | 22,080 | 24,895 | 29,455 | 31,944 | 31,213 | |||
| EBITDA - margin | 12.5% | 14.8% | 18.6% | 19.5% | 17.1% | |||
| EBIT (2) | 14,499 | 18,373 | 23,900 | 24,256 | 24,132 | |||
| EBIT - margin | 8.2% | 10.9% | 15.1% | 14.8% | 13.2% | |||
| Net finance costs | -388 | -326 | -280 | -16 | -247 | |||
| Operating result after net finance costs | 14,111 | 18,047 | 23,619 | 24,240 | 23,885 | |||
| Income taxes | -1,671 | -6,688 | -8,578 | -7,846 | -8,885 | |||
| Net result from continuing operations | 12,440 | 11,359 | 15,041 | 16,394 | 15,000 | |||
| Result from discontinued operations | ||||||||
| Attributable to minority interests | -49 | -193 | 0 | -1 | ||||
| Attributable to equity holders of RMG | 12,489 | 11,552 | 15,041 | 16,395 | 15,001 | |||
| Net result attributable to equity holders of RMG - margin |
7.1% | 6.8% | 9.5% | 10.0% | 8.2% |
*Excluding dormant companies (= not trading or in liquidation): Himalaya, Living & More Verlag and Vogue Trading Video
1. Xavier Bouckaert CEO I 2. Philippe Belpaire Director National Advertising I 3. Jos Grobben Director Magazines I 4. Jan Cattrysse Director Administration I 5. Erwin Danis Director Premedia I 6. Katrien De Nolf Director Human Resources I 7. William De Nolf Director New Media I 8. Stefaan Vermeersch Director Krant van West-Vlaanderen I 9. William Metsu Director Printing I 10. Jeroen Mouton CFO I 11. Willem Vandenameele Director IT I 12. Sophie Van Iseghem Secretary-General I 13. Luk Wynants Director Local Media
8
5
9
1. Rik De Nolf Chairman I 2. Xavier Bouckaert CEO I 3. Katrien De Nolf Director Human Resources I 4. Jeroen Mouton CFO
• the annual report gives a true and fair view of the development, the results and the position of Roularta Media Group NV and the consolidated companies, as well as a description of the main risks and uncertainties they are faced with.
Xavier Bouckaert, CEO | Jeroen Mouton, CFO
to the ordinary general meeting of shareholders of 16 May 2017 concerning the consolidated financial statements for the period ended 31 December 2016
This annual report should be read in conjunction with the audited financial statements of Roularta Media Group NV (hereinafter 'the Group') and the accompanying notes. These consolidated financial statements were approved by the board of directors on 10 April 2017. Roularta Media Group, with its registered offices at 8800 Roeselare, Meiboomlaan 33, has been listed on Euronext Brussels since 1998. Roularta Media Group operated in 2016 in the media business, in particular in magazines, newspapers, local media, radio and TV, internet, line extensions, exhibitions and graphic production. Roularta Media Group is organised into two divisions, Printed Media and Audiovisual Media. Each of these two divisions includes a wide range of activities, which are centralised in a number of different departments, depending on their purpose as a product or offered service. Roularta Media Group's Printed Media division distinguishes itself from its competitors with a number of strong brands like Deze Week, Knack, Trends and Le Vif/L'Express. In the audiovisual sector Roularta Media Group is the 50% owner of the shares of Medialaan, which operates in Belgium in radio (Qmusic and Joe) and television (VTM, Q2, VTMKZOOM, KADET and Vitaya).
The consolidated financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRSs) issued by the International Accounting Standards Board (IASB)
and with the interpretations issued by the IASB's International Financial Reporting Interpretation Committee (IFRIC), which have been ratified by the European Commission.
The consolidated financial statements give a general overview of the Group's activities and the results obtained. They give a true and fair view of the entity's financial position, financial performance and cash flows, and have been prepared on the assumption that continuity is guaranteed.
• As of 1 January 2016, Rik De Nolf was succeeded as CEO of Roularta Media Group by Xavier Bouckaert. Rik De Nolf has assumed the position of Executive Chairman of the Board of Directors.
• On 11 February 2016, Medialaan, a 50% subsidiary of Roularta Media Group, acquired control of the companies around the Mobile Vikings brand.
• In January 2016, Roularta Media Group participated in the capital increase of Proxistore for an amount of 450,000 euros. Roularta Media Group did not participate in a second capital increase in May 2016, making the current participation percentage 46.1%.
• The company Roularta Media Nederland was liquidated as of 1 July 2016.
• On 1 July 2016, Medialaan acquired television station Acht from Concentra and launched the new men's channel 'CAZ'.
• Management strengthened the 'Lifestyle' products during the summer of 2016. This resulted in a realignment of the portfolio, including a
| Income statent | in thousands of euros | 31/12/2016 | 31/12/2015 | Trend |
|---|---|---|---|---|
| Sales | 276,464 | 290,226 | -4.7% | |
| Adjusted sales (1) | 276,427 | 289,416 | -4.5% | |
| EBITDA (2) | 34,405 | 33,598 | +2.4% | |
| EBITDA - margin | 12.4% | 11.6% | ||
| EBIT (3) | 24,887 | 31,363 | -20.6% | |
| EBIT - margin | 9.0% | 10.8% | ||
| Net finance costs | -4,687 | -5,441 | -14% | |
| Operating result after net finance costs | 20,200 | 25,922 | -22% | |
| Income taxes | 72 | 46,089 | -100% | |
| Net result from continuing operations | 20,272 | 72,011 | -72% | |
| Result from discontinued operations | 0 | -7,770 | -100% | |
| Attributable to minority interests | -1,201 | -127 | -846% | |
| Attributable to equity holders of RMG | 21,473 | 64,368 | -67% | |
| Net result attributable to equity holders of RMG - margin | 7.8% | 22.2% | ||
| Balance sheet | 31/12/2016 | 31/12/2015 | Trend | |
| Non-current assets | 307,445 | 319,007 | -3.6% | |
| Current assets | 135,756 | 130,674 | +3.9% | |
| Balance sheet total | 443,201 | 449,681 | -1.4% | |
| Equity - Group's share | 222,293 | 207,649 | +7.1% | |
| Equity - minority interests | 1,762 | 1,868 | -5.7% | |
| Liabilities | 219,146 | 240,164 | -8.8% | |
| Liquidity (4) | 1.4 | 1.1 | +27.3% | |
| Solvency (5) | 50.6% | 46.6% | +8.6% | |
| Net financial debt | 57,443 | 75,680 | -24.1% | |
| Gearing (6) | 25.6% | 36.1% | -29.1% |
(1) Adjusted sales = like-for-like, i.e. adjusted for changes in the consolidation scope.
(2) EBITDA = operating cash flow = EBIT + depreciations, write-downs and provisions.
(3) EBIT = operating result, including the share in the result of associates and joint ventures.
(4) Liquidity = current assets / current liabilities.
(5) Solvency = equity (Group's share + minority interests) / balance sheet total.
(6) Gearing = net financial debt / equity (Group's share + minority interests).
Consolidated sales in 2016, which under IFRS 11 take no account of joint ventures including Medialaan and Plus Magazine (in Belgium, the Netherlands and Germany), declined slightly (-4.7%, from 290 to 276 million euros). The decrease in advertising revenues at Local Media and the magazines (-6%) was offset by the strong performance of internet advertising revenue (+14%). Subscription revenue was virtually stable (-1%). Newsstand sales (-9%) dropped due to the disappearance of Belgian sales of Point de Vue. In addition, there was less commercial printing of the Group's former French magazines (-6%).
The increase in EBITDA for 2016 amounts to 0.8 million euros or 2% compared to 2015. This increase is due to non-recurring costs in 2015 for payment in the Kempenland dispute (6.7 million euros). In 2016 we invested in future digital activities such as the e-commerce platform Storesquare.be and the telecom/data platform Mobile Vikings, which also put pressure on the EBITDA. EBIT in 2016 contains no more major one-off items, which was still the case in 2015 (Kempenland and impairment losses on titles), and amounted to 24.9 million euros.
Lower net finance costs due to a lower debt position in 2016 compared to 2015, result in a net result attributable to equity holders of RMG of 21.5 million euros or 1.72 euros per share.
Combined sales increased by 5.4 million euros or 1.1%, mainly due to advertising revenue for television at Medialaan and the acquisition of Mobile Vikings.
| Division | 31/12/2016 31/12/2015 | Trend | |
|---|---|---|---|
| Printed Media | 295,220 | 308,130 | -4.2% |
| Audiovisual Media | 182,729 | 164,096 | +11.4% |
| Intersegment sales |
-1,543 | -1,199 | |
| Combined sales | 476,406 | 471,027 | +1.1% |
Printing for third parties
& rights
repositioning of Nest, strengthening of Knack Weekend, Le Vif Weekend,... and switching from an indefinite expected life to a fixed life (3 years) for the intangible assets related to the cash generating Lifestyle unit starting in July 2016.
• In October, Roularta Media Group and KBC participated in the capital increase of Storesquare. This increased the share percentage of Roularta Media Group in the company Storesquare NV from 65% to 71%.
Sales from the Printed Media division fell by 4%, from 308 to 295 million euros.
Adjusted revenue in 2016 amounts to 295 million euros compared to 307 million in 2015.
EBITDA rose from 18.8 to 20.6 million euros, mainly as a result of lower operating costs in 2016, the absence of restructuring costs in 2016 and the payment in 2015 related to the Kempenland dispute.
EBIT fell from 16.3 to 10.6 million euros. The reason for the rise in EBITDA and a decline in EBIT is principally the one-off positive effect in 2015 of the reversal of provisions and write-downs for 5.7 million euros versus 2016.
There is a further decline in net finance costs of 0.7 million euros to 4.6 million euros. Taxes amounted to 0.8 million euros in 2016, mainly from the operations of our joint venture with Groupe Bayard.
The net result attributable to equity holders of RMG at the print division amounted to 6.5 million euros. The 1.2 million euros in minority interests in 2016 came mainly from the loss at Storesquare NV, for which RMG currently holds 71% of the shares.
Sales from the Audiovisual Media division increased by 11.4%, from 164 to 183 million euros. Adjusted sales in 2016, not including revenue from acquisitions Mobile Vikings and CAZ, amounts to 167 million euros, an increase of 2%.
EBITDA decreased slightly by 0.7 million euros to 31 million euros or -2%, due mainly to increased mobile transmission and launch costs. EBIT is in line with last year: 24 million euros. This is because the increased depreciation for fixed assets – 2.2 million euros, mainly related to Mobile Vikings and CAZ – is offset by the near elimination of write-downs and provisions in 2016 compared to 2015.
The net result for the Audiovisual Media division amounts to 15 million euros, which is slightly lower than the 16 million euros in 2015 due to higher net finance costs and taxes.
Equity – Group's share on 31 December 2016 amounted to 222 million euros, versus 208 million euros on 31 December 2015. The movement in equity consists mainly of the profit for 2016 (21.5 million) less the dividends paid (6.3 million euros).
As of 31 December 2016, consolidated net financial debt amounted to 57.4 million euros, a decrease of 18.3 million euros compared to the end of 2015, which is mainly explained by the repayment of bank loans amounting to 6.2 million euros and the 12 million euro increase in the cash position.
The evolution to a stronger balance sheet between 2015 and 2016 is also highlighted by improving indicators such as liquidity, solvency and gearing.
Total consolidated investments in 2016 amounted to 8 million euros, including a 0.5 million euro capital increase, 3.1 million euros in investments in intangible assets (mainly software) and 4.5 million euros in tangible fixed assets (mainly equipment).
Since the end of the financial year the following main events have occurred:
Otherwise no major events have occurred which significantly affect the results and the financial position of the company.
We do not foresee any notable circumstances that can significantly influence the future development of Roularta Media Group.
As a multimedia company Roularta Media Group operates in various high-tech sectors. Within these it is constantly seeking new opportunities, with a reputation as a major innovator.
Roularta Media Group attaches paramount importance to research and development. These efforts obviously benefit the Group's own internal operating processes, but in many cases also drive fundamental market developments.
For a detailed description of research and development, we refer to the chapter 'Roularta as technological innovator' in the 2016 annual report.
The Group uses exchange rate contracts to hedge the risk of changes in the fair market value of a recognised asset or liability, or an unrecognised definite commitment, within the scope of its commercial activities. The forward contracts used for these hedges do not have a direct impact on the financial position or results of the Group as these instruments are only used by associates which are consolidated by the equity method and, therefore, are only reflected in the share in the result of associates and joint ventures.
To hedge risks with respect to adverse interest rate fluctuations, the Group has used financial instruments, namely Interest Rate Swap (IRS) contracts. In accordance with the requirements defined in IAS 39, some of the contracts were regarded as cash flow hedging contracts. Market values of these contracts are recognised directly in equity. The other contracts are not regarded as hedging contracts under the conditions set forth in IAS 39. Fluctuations of market values of these contracts are recognised in the income statement.
Please refer to the chapter Environment, Prevention and Well-being in the 2016 annual report.
As at 31 December 2016, the Group has 1,354 fulltime equivalent (FTE) employees, compared with 1,364 full-time equivalent (FTE) employees the previous year. These figures exclude joint ven-
tures.
Including the pro rata share of Roularta in the joint ventures, the Group has 1,836 full-time equivalent (FTE) employees at 31 December 2016.
Changes in general, global or regional economic conditions or economic conditions in areas where the Group operates and which could impact consumers' consumption patterns, can negatively impact the Group's operating results.
Risks relating to market developments The media market is constantly changing. The profit generated by the Group is largely determined by the
advertising market, the readers market and viewing and listening figures.
The Group tracks market developments in the media world so that it can capitalise at all times on changes and new trends in the environment in which the company operates. Thanks to the Group's multimedia offer, it can suitably respond to a shift in focus in the advertising world and on the part of its readership from one form of media to another.
Strategic risk associated with markets and
growth ments.
The Group may be faced with unfavourable market conditions or unfavourable competitive develop-
The various costs that to a large extent determine the total cost in the Printed Media division, such as printing, distribution, staff, and promotion costs, can fluctuate according to the economic situation.
The evolution of international paper prices is uncertain and may adversely affect the business, operating results and/or financial position of the Group if price increases cannot be passed on in time to its customers. To manage the paper price risk, the Group concludes periodical contracts for newspaper and for magazine paper.
Disturbances or disruptions of the IT system The Group is exposed to potential disturbances or disruptions in its computer systems.
Computer systems are a central part of the Group's business. A disturbance in the Group's computer systems due to malfunctioning, malicious attacks, viruses or other factors could seriously impact various aspects of its activities, including but not limited to sales, customer service and administration. Computer system disturbances can have an adverse effect on the Group's activities or operating results. To date, the company has not experienced substantial problems with its computer systems. Year after year the Group invests substantial means to optimise its IT systems and to reduce possible disturbances.
Risks associated with intellectual property The enforcement of intellectual property rights is costly and uncertain. The Group can not guarantee that it will be successful in preventing abuse of its intellectual property rights.
The Group's position could be significantly adversely affected if brand recognition were significantly to reduce or if the Group's leading brands, publications and products were to suffer reputational damage.
The Group has the necessary approvals for undertaking its radio and television activities in Belgium. An inability to extend these could potentially negatively impact the Group's financial position and/or results.
In takeover situations, the Group is exposed to risks related to the integration of the entities acquired.
The Group needs to develop new applications on an ongoing basis. Without this, it runs the risk of falling behind its competitors and being unable to catch up again, which could negatively impact the Group's financial position and/or results.
The Group is exposed to a currency risk with respect to the USD. The identified currency risks relate to the (expected) purchases in USD in the Audiovisual Media segment. In addition, the Group incurs to a certain extent foreign currency risks related to its operational activities.
With regard to the purchases and the firm commitments to purchase film rights in USD in the Audiovisual Media segment, the Group uses foreign exchange contracts to hedge the risk of changes in the fair value of a recognised asset or liability, or a non-recognised definite undertaking in the context of its commercial activities.
Despite these foreign exchange contracts, fluctuations in the USD can have a limited impact on the Group's operating results.
The Group's level of debt and the related interest expense can have a major influence on the Group's result and/or the financial position. In order to hedge the risks of unfavourable interest rate fluctuations the Group may use financial instruments.
The Group is exposed to the credit risk on its customers, which could lead to credit losses. To control this credit risk, credit investigations are performed on customers which request major credit facilities. Where the outcome is negative, credit is refused or restricted.
In addition, the Group also uses trade finance instruments, such as letters of credit, to cover part of its credit risk and credit insurances are concluded for a small percentage of foreign clients of the printing works.
There is no significant concentration of credit risks with a single counterparty.
Despite the Group's intention of limiting its credit risk, it can face a deterioration of the creditworthiness of its customers. Any failure to conclude a credit insurance policy with respect to certain customers can have a material adverse effect on the Group's business, financial condition and/or results.
The company's lenders, the lenders of the convertible debenture not included, have imposed covenants relating to the debt ratio (net financial debt/EBITDA), interest coverage (EBITDA/net finance costs), gearing (net debt/equity), solvency and dividends.
Any breach of covenants could lead to the Group's financial debts being immediately due and payable.
The Group's indebtedness and the restrictions agreed upon in the financing agreements may adversely affect the Group's liquidity position.
The Group expects to meet its obligations through operating cash flows and current cash and cash equivalents. In addition, the Group has various short-term credit lines that form an additional working capital buffer. There is for these credit facilities by the lenders no specific maturity guaranteed.
The Group is constantly seeking to optimise its capital structure (mix of debt and equity). The main objective of the capital structure is to maximise shareholder value while maintaining the desired financial flexibility for implementing strategic projects.
Risks relating to possible impairments of goodwill and tangible and intangible fixed assets
An impairment loss is recognised when the book value of an asset, or the cash-generating unit to which the asset belongs, is higher than the recoverable amount. This recoverable amount is determined on the basis of business plans prepared by management and approved by the board of directors. The Group points to the sensitive nature of these business plans. When, owing to market circumstances, the assumptions contained in the aforementioned business plans cannot be achieved, impairments are recognised in the profit and loss account, with an effect on the net income and shareholders' equity of the Group.
A detailed description of the impairment tests, including sensitivity, is included in Note 14 to the consolidated financial statements.
Risks relating to legislation and arbitration The Group is involved in a number of disputes, currently pending. For these disputes, mostly provisions were set up. The Group can not guarantee that it will not in future face material litigation by third parties in relation to published articles, other forms of communication and more in general the activities
of the Group.
A detailed description of the most important pending disputes is included in Note 25 to the consolidated financial statements.
Roeselare, 10 April 2017 The Board of Directors
As a multimedia company Roularta Media Group sets out to create value for its readers, viewers, listeners, advertising customers, employees and shareholders.
In the light of this task, Roularta Media Group NV, as a listed Belgian company, subscribes to the Belgian Corporate Governance Code (2009) as its reference code (available at www.corporategovernancecommittee.be). This forms the basis for its own Corporate Governance Charter, which is published on the company's website (www.roularta.be – Roularta on the stock market management). The Charter sets out in an exhaustive and transparent fashion how Roularta Media Group is governed and how account for this governance is rendered. The Corporate Governance Charter of NV Roularta Media Group was approved by the board of directors and is regularly updated.
The board believes that observing as closely as possible the principles set out in the Charter will lead to more efficient, more transparent governance and better risk management and control of the company. Roularta Media Group's aim in so doing is to maximise value for its shareholders, its stakeholders and its institutional investors.
Enterprise Risk Management
Roularta Media Group has set up a risk assessment and internal control system in line with the requirements of the 2009 Belgian Corporate Governance Code.
The internal control of Roularta Media Group is based on the COSO ERM model (version 1) and is designed to provide reasonable assurance regarding the achievement of the objectives of the company. This implies, among other things, recognising and managing both operational and financial risks, compliance with laws and regulations, and monitoring reporting.
The Roularta Media Group organisational culture allows for decentralised operating. Executives and managers are to a large extent responsible for providing operational management. Decentralised control implies, among other things, maintaining continuous watch over risk.
A key element in risk management is the annual budget exercise, consisting of multiple consultations and discussions on business risks, the strategy, business plans and intended results. The final result is a set of objectives and targets, together with projects which should contribute to the better management or control of risks.
Continuous automation with built-in controls Many processes within Roularta Media Group are automated. An important component of automation consists of risk management with a focus on accuracy, completeness, consistency, timeliness and authentication/authorisation of information.
Continuous monitoring, primarily on the basis of built-in controls in a highly automated operational environment, ensures the prevention or timely detection of potential risks. The security of IT systems is crucial in this. Particular attention is paid here to:
[*] Part of the annual report of the board of directors.
HR tools to support operational functioning Besides IT-technical control, operational risk management is mainly characterised by the following measures:
Environment with a focus on financial controls and reporting
Risk management in terms of financial reporting consists primarily of:
Internal audit as an engine for risk management
2 benefit.
At the initiative of the audit committee, work has begun on developing a risk management system, based on the KAPLAN method. The internal auditor of Roularta Media Group, Mr Philippe Buysens, is responsible for developing and monitoring this risk management system.
The tool of choice for managing risks in a structured way is internal audits. In a process approach, risks are identified during an internal audit and then analysed. This risk assessment leads to the formulation of a certain number of management measures that are then submitted to the business unit manager concerned. In consultation it is then determined which control measures are feasible and should be implemented by priority.
Following the aforementioned KAPLAN method, the identified risks are divided into three types:
3 Type description:
Risks arising inside the organisation and offering no strategic advantage.
3 Risk limitation objective:
Avoiding or eliminating risk (probability and impact) in a cost-effective way.
3 Type description:
Risks taken in expectation of a major strategic
3 Risk limitation objective:
Limiting potential risk and impact in a costeffective way.
Type description:
External, uncontrollable risks.
3
Risk limitation objective:
Limiting impact cost-effectively should risk event occur.
These risks are then further divided into the following categories:
Branding and image Reporting and communication
Ultimately, each risk is evaluated for both its probability of occurrence and its impact:
Pentana, audit software, is used for effectively managing the identified risks. From here, a report is prepared at the end of each internal audit. Each such report includes an action plan of the various action points to be implemented. Progress in the implementation of the listed action points is monitored in periodic follow-up meetings.
The capital of the company amounted to EUR 80,000,000.00 and is represented by 13,141,123 similar shares with the same rights.
The shareholding structure is as follows:
| Number of shares |
% | |
|---|---|---|
| Koinon Comm.VA (1) | 7,480,325 | 56.92% |
| S.A. West Investment Holding (1) | 2,022,136 | 15.39% |
| Bestinver Gestión S.G.I.I.C. S.A. |
998,725 | 7.60% |
| Treasury shares | 612,825 | 4.66% |
| Individual and institutional investors |
2,027,112 | 15.43% |
(1) The Comm.VA Koinon and the S.A. West Investment Holding, in their capacity as persons acting in consort who have concluded an agreement concerning the possession, the acquisition and transfer of shares, have made a definitive notification.
All treasury shares held in portfolio by the company have no voting rights as long as they remain in the treasury portfolio.
Each share entitles its holder to one vote, under Article 33 of the articles of association, on the understanding that no one person may vote at the general meeting in respect of more than thirty-five per cent (35%) of the number of votes attached to all the shares issued by the company. Several shareholders whose securities, according to the criteria laid down in Article 6 § 2 of the Law of 2 May 2007 on disclosure of major holdings in issuers whose shares are admitted to trading on a regulated market, are joined together, cannot vote, either, at the general meeting, in respect of more than thirty-five per cent (35%) of the number of votes attached to all the shares issued by the company. The restrictions do not, however, apply if the vote relates to an amendment of the articles of association of the company or to decisions for which, under the Companies Code, a special majority is required.
A shareholder agreement has been concluded between shareholders Comm.VA Koinon and S.A. West Investment Holding, restricting the transfer of securities.
The articles of association and the Corporate Governance Charter of Roularta Media Group include specific provisions on the (re)appointment, training and evaluation of directors. Directors are appointed for a maximum period of four years by the general meeting of shareholders, that can remove them at any time. A resolution to appoint or dismiss requires a simple majority of votes. Should a directorship fall prematurely vacant, the remaining directors can themselves appoint (co-opt) a new director. In this case, the next general meeting proceeds to the final appointment.
The articles of association of NV Roularta Media Group give Comm.VA Koinon a binding right of nomination. Based on this nomination right, the majority of the directors are appointed from candidates put forward by Comm.VA Koinon as long as the latter holds, directly or indirectly, at least thirty-five percent of the shares of the company.
Decisions to amend the articles of association are subject to special quorum and majority requirements. Any decision to amend the articles of association requires the presence, in person or by proxy, of shareholders representing at least half of the share capital and the approval of at least three fourths of the capital present or represented at the meeting. If the quorum is not met, then a second meeting must be convened, at which the quorum requirement does not apply. The requirement of a special majority remains, however.
The board of directors is expressly authorised, in the case of public takeover bids on securities of the company, to increase the share capital within the limits provided by Article 607 of the Companies Code by issuing shares not exceeding 10% of the existing shares at the time of such public bid. This authorisation was granted by the extraordinary general meeting of 20 May 2014 for a term of three years. A proposal to renew this authorisation will be made to the general meeting that will take place on 16 May 2017.
The company may acquire, divest or pledge its own shares, profit certificates or other certificates relating hereto, to the extent that the relevant statutory provisions are complied with. The board of directors is expressly authorised, without a resolution of the general assembly, to acquire and hold its own shares if necessary to avoid imminent and serious harm to the company. This authorisation was granted by the extraordinary general meeting of 19 May 2015 for a period of three years, starting on 15 June 2015, being the date of publication in the annexes to the Belgian Official Gazette of the authorisation, and may be renewed. A proposal to renew the authorisation to acquire own shares will be made to the general meeting that will take place on 16 May 2017.
Following condition 6 (c) (redemption at the option of the bondholders in the event of change of control) contained in the Prospectus dated 18 September 2012 relating to the issuance of bonds: each bondholder has the option to request repayment of all or part of his bonds in the event of a change of control of Roularta Media Group.
In the context of the Law of 1 April 2007 concerning public takeover bids, Comm.VA Koinon, as the direct holder of more than 30% of the Roularta Media Group shares, updated its registration with the FSMA on 25 August 2014 pursuant to Article 74 § 6 of the above-mentioned law.
Comm.VA Koinon is a subsidiary of the Stichting Administratiekantoor Cerveteri, which is controlled by Mr Rik De Nolf.
Board of directors
The board of directors of NV Roularta Media Group has nine members:
• Mr Rik De Nolf, executive director and chairman of the board (2018).
• Five directors representing the reference shareholder, in accordance with the proposal rights under the articles of association, Mr Xavier Bouckaert, permanent representative of Comm.VA Koinon (2018), Ms Lieve Claeys (2018), Ms Caroline De Nolf, permanent representative of NV Verana (2020), Mr Joris Claeys, permanent representative of NV Cennini Holding (2018) and Mr Francis De Nolf, permanent representative of NV Alauda
(2019).
• Three independent directors, all of whom hold executive corporate functions:
» Mr Carel Bikkers, permanent representative of BV Carolus Panifex Holding (2018), has for the past nine years headed up the Dutch media group Audax, a multifaceted organisation that is involved in the broadest sense of the term with the publishing, distribution and retailing of media and related products. Prior to this Mr Carel Bikkers worked as general manager of Kwik-Fit Europe BV, Europe's largest car service chain.
» Mr Koen Dejonckheere, permanent representative of NV Invest at Value (2018)
Mr Koen Dejonckheere was appointed Chief Executive Officer of Gimv in 2008. Before, he was Managing Director and head of Corporate Finance at KBC Securities. Previously, Mr Koen Dejonckheere worked for Nesbic, Halder, Price Waterhouse Corporate Finance Europe and the BBL. Mr Koen Dejonckheere has extensive experience as a dealmaker in investment bank-
ing and private equity in Belgium and abroad. » Mr Marc Verhamme, permanent representative of SPRL Mandatum (2018), was until 1994 CEO of the North and North-West European fresh produce division of Danone. Mr Marc Verhamme is today an industrialist and owns a number of SMEs producing organic food products like yoghurt and fresh cheese,... with brands such as MIK and Pur Natur.
The Corporate Governance Code recommends that the board of directors be chaired by a non-executive director. Deviations from this recommendation need to be set out according to the "comply or explain" rule. Roularta Media Group has indeed decided to deviate from this recommendation by assigning the role of chairman to an executive director. Given the transformation phase that the media world is going through due to the digitisation of society and the emergence of new media, it is important that Mr Rik De Nolf remains active in the executive management committee as a sounding board and advisor. Mr Rik De Nolf is as chairman and executive director also responsible for the Group's external communications and investor relations.
This active executive role given to the chairman of the board of directors facilitates better communication and an improved information flow between the board and executive management, and generally contributes to the proper functioning of the company.
Today, the board of directors has two female and seven male board members. Under Article 518a § 1, the gender of at least one third of the members must differ from that of the other members. This provision will apply to the Roularta Media Group from 1 January 2019. The board of directors is making every effort to achieve the proposed legal quota on gender diversity within the board of directors before 1 January 2019.
The board of directors met six times during 2016 to discuss the company's results, the Group's multiannual plan and the following year's budget. The secretary of the board of directors, Sophie Van Iseghem, is responsible for the reporting of the board of directors and the committees established by the board of directors.
Attendance of individual board members in 2016:
| Rik De Nolf, Chairman | 6 |
|---|---|
| Xavier Bouckaert, CEO | 6 |
| Marc Verhamme, Vice-Chairman | 6 |
|---|---|
| Carel Bikkers | 6 |
| Joris Claeys | 6 |
| Lieve Claeys | 6 |
| Caroline De Nolf | 6 |
| Francis De Nolf | 6 |
| Koen Dejonckheere | 6 |
During the past year there was also a meeting of the independent directors. For 2017, six board meetings are planned.
The audit committee consists solely of indepen dent directors. The members of the audit committee have collective expertise related to the activities of the company. The expertise in accounting and auditing of Mr Carel Bikkers, chairman of the audit committee, is evident among other things from his former position as a senior manager of the Dutch media group Audax and from his board member/supervisor mandate in a number of Dutch companies.
The audit committee met five times in 2016. During these meetings the audit committee controlled the integrity of the financial information of the company, closely monitored the activities of the internal and external auditor, and where it deemed necessary, made recommendations in these respects to the board of directors.
At the invitation of the chairman, the audit committee was attended by the statutory auditor, the CEO, the chairman of the board of directors, the CFO and the internal auditor.
| Attendance at audit committee meetings in 2016: | |
|---|---|
| Carel Bikkers, Chairman | 5 |
| Marc Verhamme | 5 |
Appointments and remuneration committee The board of directors has used the opportunity as provided in the Corporate Governance Code to establish a single, joint appointments and remuneration committee.
The appointments and remuneration committee consists solely of non-executive directors, including two independent directors, and has the necessary expertise in the area of remuneration policy.
The CEO and the executive chairman of the board of directors participate in the meetings of the appointments and remuneration committee in an advisory capacity (cf. Article 526 quater of the Companies Code), except when the appointments and remuneration committee deliberates on the remuneration of the CEO and/or the executive chairman of the board of directors.
The HR director of the Group is also invited to attend the meetings of the appointments and remuneration committee.
The appointments and remuneration committee met two times during 2016. The main item on its agenda was: preparing the remuneration report and reviewing the remuneration and bonus policy of the executive management and the composition of the board of directors and its committees.
Attendance at appointments and remuneration committee meetings in 2016: Carel Bikkers 2
Marc Verhamme, Chairman 2
Every year the board of directors undertakes a review, led by the chairman and assisted by the appointments and remuneration committee, of its size, composition, functioning and interaction with executive management. This assessment has four objectives: (i) assessing the operation of the board of directors; (ii) examining whether important issues are thoroughly prepared and discussed; (iii) assessing the actual contribution of each director to the activities of the board of directors, on the basis of his or her presence at board and committee meetings and his or her constructive involvement in discussions and decision-making; (iv) establishing a comparison between the current composition of the board of directors and the pre-defined desired composition of the same.
Every year the non-executive directors assess their interaction with senior management and, where appropriate, make proposals to the chairman of the board of directors for improving this interaction.
The contribution of each director is reviewed at regular intervals. In the event of a reappointment, the engagement and the effectiveness of the director is evaluated.
The executive management of Roularta Media Group consists of the executive management committee and the management team (see page 27). With the exception of the start of Mr Jeroen Mouton as CFO of Roularta Media Group in early May 2016, no changes to the composition of executive management took place in the past year.
There were in the course of the financial year no conflicts of interest of a financial nature giving rise to the application of Article 523 of the Companies Code.
Taking into account the principles and guidelines contained in the Belgian Corporate Governance Code, the company has developed a policy on transactions and other contractual relationships between the company, including affiliated companies, and its directors and members of the executive management not covered by the statutory conflict of interests rules.
A transaction or a contractual relationship of any kind is deemed to exist between the company and its directors and/or members of its executive manage-
ment when:
• a director or a member of the executive management has a significant personal financial interest in the corporate body with which Roularta Media Group wants to conclude a transaction;
• a director or member of the executive management
or his or her spouse, cohabiting partner, child or blood or other relative up to the second degree are members of the board of directors or the executive management of the corporate body with which Roularta Media Group wishes to conclude a major transaction;
• the board deems that such a conflict exists in respect of the proposed transaction.
The director or member of the executive management concerned shall provide the board with all possible relevant information relating to the conflict of interests. He or she shall refrain from participating in the discussion and decision-making on this agenda item.
The board of directors confirms that in the past year no such transactions have taken place and no situations have arisen giving rise to the application of the above procedure.
The protocol for the prevention of market abuse prohibits directors, members of the management team, other members of staff or external persons employed by the company, who, by the nature of their function come into contact with confidential information, from trading, directly or indirectly, on the basis of insider information, in financial instruments issued by Roularta Media Group. In view of the entry into force at the start of July 2016 of European Regulation No. 596/2014 on market abuse, the board of directors has revised the existing protocol to prevent market abuse in order to bring it in line with the uniform European market abuse regulations.
The starting point of the compensation and benefits policy for (executive and non-executive) management is the attraction and retention of qualified managers with the required background and experience in terms of the various elements of corporate policy. To achieve this starting point, the compensation and benefits policy is market competitive and takes into account the company's size and complexity using reference data where possible.
Non-executive directors and executive directors in their capacity as directors receive only a fixed remuneration as compensation for their membership of the board of directors and their attendance at the board meetings and the meetings of the committees of which they are members.
The level of directors' remuneration is determined taking into account their role as a normal director, their specific roles as chairman of the board, chair or member of a committee, as well as the resulting responsibilities and time demands.
Non-executive directors receive no performancerelated remuneration such as bonuses, long-term incentive programmes, benefits in kind or pension plans. Nor are options or warrants allotted to non-executive directors. There are no contributions to pensions or similar benefits for directors. The provisions concerning the remuneration of the non-executive directors apply equally to executive directors in their capacity as directors.
The chairman of the board of directors and the managing director were granted a fixed remuneration of EUR 100,000. The vice-chairman of the board receives a fixed remuneration of EUR 50,000. Each other board member receives a fixed remuneration of EUR 10,000, plus a fee per board meeting of EUR 2,500; members of board committees (the audit committee and the appointments and remuneration committee) receive an additional fee per meeting of EUR 2,500, the chairman of the audit committee an additional EUR 5,000 fee per meeting of this committee. The directors' remuneration policy will not be changed in the two coming financial years.
| Fixed Attend ance fee |
|||
|---|---|---|---|
| Rik De Nolf Chairman of the board of directors |
Executive | EUR 100,000.00 |
_ |
| Xavier Bouckaert permanent repre sentative of Comm. VA Koinon – Managing Director |
Executive | EUR 100,000.00 |
_ |
| Marc Verhamme permanent represen tative of SPRL Manda tum – Vice-Chairman of the board of direc tors – member audit committee – Chair man appointments and remuneration committee |
Non executive & inde pendent |
EUR 50,000.00 |
_ |
|---|---|---|---|
| Carel Bikkers permanent represen tative of BV Carolus Panifex Holding – Chairman audit committee – member appointments and remuneration committee |
Non executive & inde pendent |
EUR 10,000.00 |
EUR 42,500.00 |
| Joris Claeys permanent represen tative of NV Cennini Holding |
Non executive |
EUR 10,000.00 |
EUR 12,500.00 |
| Lieve Claeys | Non executive |
EUR 10,000.00 |
EUR 12,500.00 |
| Caroline De Nolf permanent represen tative of NV Verana |
Non executive |
EUR 10,000.00 |
EUR 12,500.00 |
| Francis De Nolf permanent represen tative of NV Alauda |
Executive | EUR 10,000.00 |
EUR 12,500.00 |
| Koen Dejonckheere permanent represen tative of NV Invest at Value |
Non executive & inde pendent |
EUR 10,000.00 |
EUR 12,500.00 |
The remuneration of the members of executive management is set by the board of directors based on the recommendation of the appointments and remuneration committee. The level and structure of the remuneration of the executive management need to enable the company to attract, retain and continually motivate qualified and skilled managers, taking into account the nature and scope of their individual responsibilities.
The amount and structure of the basic remuneration of the executive management is regularly reviewed for its compliance with market conditions by a specialist (international) salaries and benefits consultancy. The company is assuming that the remuneration policy for members of the executive management will remain unchanged for the next two years unless testing against market practice shows that changes are urgently needed.
In 2016, the remuneration policy of the members of the executive management did not change from that of previous years. The remuneration of the executive management consists of:
• basic remuneration in line with training, job content, experience and seniority;
• a performance bonus linked for 30% to the consolidated results of the Group and for 70% to the performance of the business unit for which the manager is responsible. Every year financial performance criteria are established for the year in question at the level of the consolidated Group results. At business unit level, financial or qualitative targets are set on an annual basis. At the end of the year it is determined by the appointments and remuneration committee, based on the established performance criteria, both quantitative and qualitative, whether and to what extent the bonus has been earned. On the recommendation of the appointments and remuneration committee, the board of directors approves the bonuses of the executive management. The bonus may not exceed 20% to 25% of the basic annual salary of members of the executive management. The bonus is paid to the group insurance of the manager in question. A small portion of the bonus can be paid out in cash at the request of the manager concerned. There is no provision for a right of recovery in favour of the company in cases where variable remuneration has been given based on inaccurate financial data. Bonuses are awarded only after the close of the year and the requisite verification of the figures by the auditors. In this way the likelihood of paying a bonus based on inaccurate financial data is negligible;
• a long-term incentive consisting of rights to acquire shares in Roularta Media Group. The option plans issued by the company each run for ten years, with exercise possible no earlier than the third calendar year after subscription;
• extra-legal ('fringe') benefits, consisting of a group
insurance (employer's contribution is 3.75% of the annual remuneration), a company car with fuel card in accordance with the company's car policy, luncheon vouchers (employer's contribution of maximum EUR 6.91/day worked) and hospitalisation and disability insurance.
The CEO, Comm.VA Koinon with Mr Xavier Bouckaert as its permanent representative, received in 2016 a gross fixed remuneration of EUR 644,771.36. The remuneration package for the CEO does not include shares, share options, nor are the pension contributions included.
The other members of the executive management (executive management committee members and members of the management team) together received:
specific costs and EUR 12,008.66 employer's contribution to luncheon vouchers.
In the table below you can find an overview of the stock options plans members of the executive management participated in, with their most significant terms including the exercise price and the expiration period.
19,250 options were exercised by members of executive management during the course of 2016, at an exercise price of 15.71 euros.
There were no new options granted during 2016, nor did options granted to the executive management expire during this period.
Severance pay for executive managers The severance pay for members of executive management is estimated on the basis of the Belgian employment law that applies, except for the managing director and the members of the executive management providing their services via management companies. For the managing director, the period of notice is 12 months, while for other members of executive management with self-employed status, notice periods (or severance pay in lieu) of between four and six months apply.
| Year of allotment |
Number of options allotted |
Exercice price (in EUR) |
First exercise period |
Last exercise period |
|---|---|---|---|---|
| 2006 | 79,500 | 53.53 | 01/01-31/12/2010 | 01/01-31/12/2021 |
| 2008 | 68,000 | 40.00 | 01/01-31/12/2012 | 01/01-31/12/2023 |
| 2009 | 79,500 | 15.71 | 01/01-31/12/2013 | 01/01-31/12/2019 |
| 2015 | 42,500 | 11.73 | 01/01-31/12/2019 | 01/01-31/12/2025 |
Overview stock options allotted to the executive management
| in thousands of euros | Note | 2016 | 2015 |
|---|---|---|---|
| in thousands of euros | Note | 2016 | 2015 | |
|---|---|---|---|---|
| Sales | 3 | 276,464 | 290,226 | |
| Own construction capitalised | 2,098 | 1,710 | ||
| Raw materials, consumables and goods for resale | -67,762 | -72,785 | ||
| Services and other goods | 4 | -101,638 | -102,880 | |
| Personnel | 5 | -91,389 | -91,839 | |
| Other operating income | 7 | 4,158 | 6,302 | |
| Other operating expenses | 7 | -5,720 | -12,654 | |
| Restructuring costs: costs | 8 | -3,535 | ||
| Share in the result of associated companies and joint ventures | 16 | 18,194 | 19,053 | |
| EBITDA | 34,405 | 33,598 | ||
| Depreciation, write-down and provisions | -9,518 | -2,077 | ||
| Depreciation and write-down of intangible and tangible assets | -10,248 | -9,329 | ||
| Write-down of inventories and debtors | 6 | 42 | 914 | |
| Provisions | 688 | 8,556 | ||
| Impairment losses | 0 | -2,218 | ||
| Restructuring costs: provisions | 8 | 0 | -158 | |
| Operating result - EBIT | 24,887 | 31,363 | ||
| Financial income | 9 | 1,413 | 1,308 | |
| Financial expenses | 9 | -6,100 | -6,749 | |
| Operating result after net finance costs | 20,200 | 25,922 | ||
| Income taxes | 10 | 72 | 46,089 | |
| Net result from continuing operations | 20,272 | 72,011 | ||
| Result from discontinued operations | 11 | 0 | -7,770 | |
| Net result of the consolidated companies | 20,272 | 64,241 | ||
| Attributable to: | ||||
| Minority interests | -1,201 | -127 | ||
| Equity holders of Roularta Media Group | 21,473 | 64,368 | ||
| Earnings per share | in euros | Note | 2016 | 2015 |
| From continuing and discontinued operations | ||||
| Basic earnings per share | 12 | 1.72 | 5.16 | |
| Diluted earnings per share | 12 | 1.70 | 5.14 | |
| From continuing operations | ||||
| Basic earnings per share | 12 | 1.72 | 5.78 | |
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Net result of the consolidated companies | 20,272 | 64,241 |
| Other comprehensive income of the period | ||
| Other comprehensive income to be reclassified to profit or loss in subsequent periods: | ||
| Exchange differences | -12 | -34 |
| Other comprehensive income not to be reclassified to profit or loss in subsequent periods: |
||
| Non-current employee benefits - actuarial gain / loss | -1,098 | -147 |
| Deferred taxes relating to other comprehensive income | 372 | -76 |
| Share of non-reclassifiable other comprehensive income of joint ventures and associates |
-280 | |
| Other comprehensive income of the period | -1,018 | -257 |
| Total comprehensive income | 19,254 | 63,984 |
| Attributable to: | ||
| Minority interests | -1,201 | -127 |
| Equity holders of Roularta Media Group | 20,455 | 64,111 |
| ASSETS | in thousands of euros | Note | 2016 | 2015 |
|---|---|---|---|---|
| Non-current assets | 307,445 | 319,007 | ||
| Intangible assets | 14 | 84,399 | 86,158 | |
| Goodwill | 14 | 0 | 5 | |
| Property, plant and equipment | 15 | 56,023 | 57,025 | |
| Investments accounted for using the equity method | 16 | 127,722 | 120,735 | |
| Available-for-sale investments, loans, guarantees | 17 | 2,470 | 2,844 | |
| Trade and other receivables | 18 | 15,568 | 31,479 | |
| Deferred tax assets | 19 | 21,263 | 20,761 | |
| Current assets | 135,756 | 130,674 | ||
| Inventories | 20 | 6,236 | 5,464 | |
| Trade and other receivables | 18 | 73,989 | 81,867 | |
| Tax receivable | 284 | 390 | ||
| Short-term investments | 21 | 46 | 46 | |
| Cash and cash equivalents | 21 | 50,565 | 38,496 | |
| Deferred charges and accrued income | 4,636 | 4,411 | ||
| Total assets | 443,201 | 449,681 |
| LIABILITIES | in thousands of euros Note |
2016 | 2015 |
|---|---|---|---|
| Equity | 224,055 | 209,517 | |
| Group's equity | 222,293 | 207,649 | |
| Issued capital | 22 | 80,000 | 80,000 |
| Treasury shares | 22 | -23,931 | -24,376 |
| Retained earnings | 163,224 | 148,159 | |
| Other reserves | 22 | 2,966 | 3,820 |
| Translation differences | 34 | 46 | |
| Minority interests | 1,762 | 1,868 | |
| Non-current liabilities | 118,842 | 123,862 | |
| Provisions | 24 | 7,380 | 8,417 |
| Employee benefits | 26 | 5,079 | 3,527 |
| Deferred tax liabilities | 19 | 521 | 521 |
| Financial debts | 27 | 105,825 | 111,360 |
| Trade payables | 28 | 0 | 0 |
| Other payables | 28 | 37 | 37 |
| Current liabilities | 100,304 | 116,302 | |
| Financial debts | 27 | 2,229 | 2,862 |
| Trade payables | 28 | 42,266 | 48,086 |
| Advances received | 28 | 17,582 | 19,841 |
| Employee benefits | 28 | 13,497 | 18,008 |
| Taxes | 28 | 771 | 1,630 |
| Other payables | 28 | 16,242 | 20,277 |
| Accrued charges and deferred income | 28 | 7,717 | 5,598 |
| Total liabilities | 443,201 | 449,681 |
| Cash flow relating to investing activities | ||
|---|---|---|
| Intangible assets - acquisitions 14 |
-3,090 | -3,172 |
| Tangible assets - acquisitions 15 |
-4,448 | -2,288 |
| Intangible assets - other movements | -64 | |
| Tangible assets - other movements | 34 | 1,415 |
| Net cash flow relating to acquisition of subsidiaries 32 |
-450 | -1,622 |
| Net cash flow relating to disposal of subsidiaries 33 (*) |
16,000 | 12,782 |
| Net cash flow relating to loans to investments accounted for using the equity method |
142 | -725 |
| Available-for-sale investments, loans, guarantees - other movements | 14 | 1,137 |
| Increase / decrease in short-term investments | 780 | |
| NET CASH FLOW RELATING TO INVESTING ACTIVITIES (B) | 8,202 | 8,243 |
| Cash flow relating to financing activities | ||
| Dividends paid | -6,253 | 0 |
| Treasury shares | 445 | 271 |
| Other changes in equity | 924 | -89 |
| Proceeds from current financial debts | 0 | 834 |
| Redemption of current financial debts | -2,279 | -2,976 |
| Redemption of non-current financial debts | -3,938 | 0 |
| Decrease in non-current receivables | 143 | 54 |
| NET CASH FLOW RELATING TO FINANCING ACTIVITIES (C) | -10,958 | -1,906 |
| TOTAL DECREASE / INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C) | 12,069 | 3,743 |
| Cash and cash equivalents, beginning balance | 38,496 | 34,753 |
| Cash and cash equivalents, ending balance | 50,565 | 38,496 |
| Net decrease / increase in cash and cash equivalents | 12,069 | 3,743 |
| (*) Including funds received in 2016 related to the sale of the French operations in 2015. |
Notes to the consolidated cash flow statement The cash flow statement shows the source of the Group's strong cash generation of 12 million euros in 2016 compared to 4 million euros in 2015. This brings the total cash position at the end of 2016 to 50.6 million euros. Normalisation in 2016 of cash flow from operating activities compared to 2015, where the disinvestments related to the French operations are still included, accounts for 15 million euros. For cash flow from investing activities, in 2016 there is the income of 16 million euros from the collection of the long-term receivable from the Altice Group for the divested French operations, in addition to the capital expenditure of 8 million euros. Cash flow from financing activities in 2016 consists mainly of the payment of 6 million euros in dividends and the repayment of bank debts amounting to 6 million euros.
| in thousands of euros | Note | 2016 | 2015 |
|---|---|---|---|
| Cash flow relating to operating activities | |||
| Net result of the consolidated companies | 20,272 | 64,204 | |
| Share in the results of associated companies and joint ventures | 16 | -18,194 | -19,549 |
| Income tax expense / income | 10 & 11 | -72 | -46,089 |
| Interest expenses | 6,100 | 7,122 | |
| Interest income (-) | -1,413 | -1,295 | |
| Losses (+) / gains (-) on disposal of intangible assets and property, plant and equipment |
17 | -678 | |
| Losses (+) / gains (-) on disposal of business | -398 | 4,620 | |
| Dividends received from associated companies and joint ventures | 11,741 | 16,667 | |
| Non-cash items | 10,036 | -1,337 | |
| Depreciation of (in)tangible assets | 14 & 15 | 10,248 | 9,339 |
| Impairment losses | 14 | 2,218 | |
| Share-based payment expense | 5 | 152 | 16 |
| Losses (+) / gains (-) on non-hedging derivatives | 9 | -293 | |
| Increase (+) / decrease (-) in provisions | -688 | -11,403 | |
| Unrealised exchange loss (+) / gain (-) | -1 | ||
| Other non-cash items | 324 | -1,213 | |
| Gross cash flow relating to operating activities | 28,089 | 23,665 | |
| Increase / decrease in current trade receivables | 7,939 | 8,590 | |
| Increase / decrease in current other receivables and deferred charges and accrued income |
809 | -7,726 | |
| Increase / decrease in inventories | -734 | 547 | |
| Increase / decrease in current trade payables | -5,820 | -20,744 | |
| Increase / decrease in other current liabilities | -10,707 | -466 | |
| Other increases / decreases in working capital (a) | 2,134 | -303 | |
| Increase / decrease in working capital | -6,379 | -20,102 | |
| Income taxes paid | -1,014 | -59 | |
| Interest paid | -6,067 | -7,388 | |
| Interest received | 196 | 1,290 | |
| NET CASH FLOW RELATING TO OPERATING ACTIVITIES (A) | 14,825 | -2,594 |
(a) Increases and decreases in non-current other payables, non-current trade payables, provisions, non-current employee benefits and accrued charges and deferred income.
| 2016 | in thousands of euros | Issued capital |
Treasury shares |
Retained earnings |
Other reserves |
Transla tion diffe rences |
Minority interests |
Total equity |
|---|---|---|---|---|---|---|---|---|
| Balance as of 01/01/2016 | 80,000 | -24,376 | 148,159 | 3,820 | 46 | 1,868 | 209,517 | |
| for the period | Total comprehensive income | 21,473 | -1,006 | -12 | -1,201 | 19,254 | ||
| Operations with own shares | 445 | 445 | ||||||
| Dividends | -6,253 | -6,253 | ||||||
| payments | Recognition of share-based | 152 | 152 | |||||
| interests | Dividend paid to minority | -100 | -100 | |||||
| Other increase / decrease | -155 | 1,195 | 1,040 | |||||
| Balance as of 31/12/2016 | 80,000 | -23,931 | 163,224 | 2,966 | 34 | 1,762 | 224,055 |
| 2015 | in thousands of euros | Issued capital |
Treasury shares |
Retained earnings |
Other reserves |
Transla tion diffe rences |
Minority | interests Total equity |
|---|---|---|---|---|---|---|---|---|
| Balance as of 01/01/2015 | 203,225 | -24,647 | -36,955 | 1,574 | 80 | 2,475 | 145,752 | |
| for the period | Total comprehensive income | 64,368 | -223 | -34 | -127 | 63,984 | ||
| Capital reduction (-) | -123,225 | 123,225 | 0 | |||||
| increase | Costs of issuance and equity | -8 | -8 | |||||
| Operations with own shares | 271 | 271 | ||||||
| ments | Recognition of share-based pay | 16 | 16 | |||||
| Dividend paid to minority interests | -94 | -94 | ||||||
| Other increase / decrease | -2,479 | 2,461 | -386 | -404 | ||||
| Balance as of 31/12/2015 | 80,000 | -24,376 | 148,159 | 3,820 | 46 | 1,868 | 209,517 |
We refer to Note 22 for more details.
The consolidated financial statements are prepared in compliance with the International Financial Reporting Standards (IFRSs) issued by the International Accounting Standards Board (IASB), and with the interpretations issued by the International Financial Reporting Interpretations Committee (IFRIC) of the IASB approved by the European Commission.
The consolidated financial statements give a general overview of our Group's activities and the results achieved. They represent fairly, the financial position, financial performance and cash flows of the entity, and have been prepared on a going concern basis.
The consolidated financial statements were approved by the board of directors on 10 April 2017 and can be amended until the shareholders' meeting of 16 May 2017.
New and revised standards and interpretations
Standards and interpretations applicable for the annual period beginning on 1 January 2016:
Acceptable Methods of Depreciation and Amortisation (applicable for annual periods beginning on or after 1 January 2016)
• Amendments to IAS 19 Employee Benefits – Employee Contributions (applicable for annual periods beginning on or after 1 February 2015)
The application of those IFRS standards had no material effect on the 2016 consolidated financial statements of the Group.
• IFRS 9 Financial Instruments and subsequent amendments (applicable for annual periods beginning on or after 1 January 2018)
• IFRS 14 Regulatory Deferral Accounts (applicable for annual periods beginning on or after 1 January 2016, but not yet endorsed in the EU)
• IFRS 15 Revenue from Contracts with Customers (applicable for annual periods beginning on or after 1 January 2018)
• IFRS 16 Leases (applicable for annual periods beginning on or after 1 January 2019, but not yet endorsed in the EU)
• Improvements to IFRS (2014-2016) (applicable for annual periods beginning on or after 1 January 2017 or 2018, but not yet endorsed in the EU)
• Amendments to IFRS 2 Classification and Measurement of Share-based Payment Transactions (applicable for annual periods beginning on or after 1 January 2018, but not yet endorsed in the EU)
• Amendments to IFRS 4 Insurance Contracts - Applying IFRS 9 Financial Instruments with IFRS 4 (applicable for annual periods beginning on or after 1 January 2018, but not yet endorsed in the EU)
• Amendments to IFRS 10 and IAS 28 Sale or Contribution of Assets between an Investor and its Associate or Joint Venture (the effective date has been deferred indefinitely, and therefore the endorsement in the EU has been postponed)
• Amendments to IAS 7 Statement of Cash Flows – Disclosure Initiative (applicable for annual periods
A joint arrangement exists when Roularta Media Group NV has contractually agreed to share control with one or more other parties, which is the case only when decisions about the relevant activities require the unanimous consent of the parties sharing control. A joint arrangement can be treated as a joint operation (i.e. Roularta Media Group NV has rights to the assets and obligations for the liabilities) or a joint venture (i.e. Roularta Media Group NV only has rights to the net assets).
Associates are companies in which Roularta Media Group NV, directly or indirectly, has a significant influence and which are neither subsidiaries nor joint arrangements. This is presumed if the Group holds at least 20% of the voting rights attaching to the shares.
The financial information included for these companies is prepared using the accounting policies of the Group. When the Group has acquired joint control in a joint venture or significant influence in an associate, the share in the acquired assets, liabilities and contingent liabilities is initially remeasured to fair value at the acquisition date and accounted for using the equity method. Any excess of the purchase price over the fair value of the share in the assets, liabilities and contingent liabilities acquired, is recognised as goodwill. When the goodwill is negative, it is immediately recognised in profit or loss. Subsequently, the consolidated financial statements include the Group's share of the results of joint ventures and associates accounted for using the equity method until the date when joint control or significant influence ceases.
If the Group's share of the losses of a joint venture or associate exceeds the carrying amount of the investment, the investment is carried at nil value and recognition of additional losses is limited to the extent of the Group's commitment. Such additional accumulated losses are included in other provisions on the consolidated balance sheet.
Unrealised gains arising from transactions with joint ventures and associates are set against the investment in the joint venture or associate concerned to the extent of the Group's interest. The carrying amounts of investments in joint ventures and associates are reassessed if there are indications that the asset has been impaired or that impairment losses
recognised in prior years have ceased to apply. The investments in joint ventures and associates in the balance sheet include the carrying amount of any related goodwill.
The share in the result of associates and joint ventures is presented as part of operating result of the
Group.
The acquisition price (the consideration transferred in a business combination) is measured as the sum of the fair value at the acquisition date of the transferred assets, the liabilities incurred or assumed, and the equity interests issued by the acquirer. The purchase price also includes all assets and liabilities arising from a contingent consideration
agreement.
Acquisition-related costs are expensed in the period incurred.
The identifiable assets acquired and the liabilities assumed are measured at their fair value at the acquisition date.
For each business combination any non-controlling interest (minority interest) in the acquiree is valued at fair value or at the NCI's proportionate share in the identifiable net assets of the acquiree. The choice of accounting basis is made on a transactionby-transaction basis.
These are recognised in accordance with the previous version of IFRS 3.
Transactions in foreign currency are recorded on initial recognition in the functional currency, by applying to the foreign currency amount the spot exchange rate at the date of transaction. At each balance sheet date foreign currency monetary items are translated using the closing rate. Non-monetary items are translated using the exchange rate at the date of the transaction. Exchange differences arising on the settlement of monetary items or on translating monetary items at rates different from those at which they were translated on initial recognition are recognised in profit or loss as other operating income or costs in the period in which they arise.
beginning on or after 1 January 2017, but not yet endorsed in the EU)
The basic principle of IFRS 15 Revenue from Contracts with Customers (applicable to annual reporting periods beginning after 2018) is that a company must recognise revenue for goods or services delivered for the amount the company expects to receive in exchange for these goods or services. To apply the basic principle, a company must complete the following steps:
Roularta has not yet finalised its work on the impact on the financial statements of this new standard. However, an initial analysis indicates that there will be no material impact on the results of the Group. A further detailed analysis will be carried out in 2017. The Group does not intend to apply this new stan dard before 2018.
The new standard IFRS 16 Leases, which supersedes IAS 17 Leases and related interpretations, eliminates the classification of leases as either ope rating leases or finance leases for a lessee. Instead all leases are capitalised and accounted for in a similar way to finance leases under IAS 17, except short-term leases and leases of low-value assets. Note 29 contains the information related to the presently booked finance and operating leases.
The Group does not expect the first application of the other amendments and new standards to significantly impact its financial statements.
The consolidated financial statements consolidate the financial information of Roularta Media Group NV, its subsidiaries and joint ventures, after elimination of all material transactions within the Group.
Subsidiaries are entities over which Roularta Media Group NV exercises control, which is the case when the Group is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect these returns through its power over the entity. All intercompany transactions, balances with and unrealised gains on transactions between Group companies are eliminated; unrealised losses are also eliminated unless the impairment is permanent. Equity and net result attributable to non-controlling shareholders are shown separately in the balance sheet and income statement, respectively. Changes in the Group's ownership interests in subsidiaries that do not result in the Group losing control over the subsidiaries are accounted for as equity transactions. The carrying amounts of the Group's interests and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries.
Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity. When the Group loses control of a subsidiary, the profit or loss on disposal is calculated as the difference between:
The financial statements of subsidiaries are included in the consolidated financial statements from the date on which the parent company acquires control until the date on which the control ceases.
The financial statements of subsidiaries are prepared for the same financial year as that of the parent company and using uniform accounting policies for like transactions and other events in similar circumstances.
Acquisitions of subsidiaries are accounted for by applying the purchase method.
and equipment as deemed cost on the date of transition to IFRS, being 1 January 2003. This fair value is based on the value in going concern as determined by third party experts and was applied to all of the
Group's land and buildings, as well as to printing presses and finishing lines.
Lease arrangements whereby the Group has substantially all rewards and risks incidental to ownership are classified as finance leases. At the commencement of the finance lease term, finance leases are recognised as assets and liabilities in the balance sheet at amounts equal to the fair value of the leased property, or, if lower, the present value of the minimum lease payments each determined at the inception of the lease.
Minimum lease payments shall be apportioned between the finance charge and the reduction of the outstanding liability. The finance charge shall be allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability. Contingent rents shall be charged as expenses in the periods in which they are incurred.
The depreciable amount of an item of property, plant and equipment (i.e. the cost less its residual value) is recognised in the income statement on a straightline basis from the date the asset is available for use over the expected useful life.
The following useful lives are applied:
| • Buildings | |
|---|---|
| » revalued |
20 years |
| » not revalued |
33 years |
| » buildings on leasehold land |
term of lease |
| »TV stages | 3 years |
|---|---|
| » others |
5 years |
| • Furniture and office equipment | 5 to 10 years |
| • Electronic equipment | 3 to 5 years |
| • Vehicles | 4 to 5 years |
| • Other property, plant and equipment 5 to 10 years | |
| • Assets under construction | no depreciation |
| and advance payments | |
| • Property held under a finance lease | |
| » printing presses and finishing lines 3 to 20 years |
|
| » broadcast material |
5 years |
Land is not depreciated since it is assumed that it has an indefinite useful life.
The purchase or sale of financial assets is recognised using the settlement date. This implies that the asset is recognised on the date it is received by the Group, and it is derecognised on the date it is delivered by the Group; at this date any gain or loss on disposal is recognised.
At initial recognition all available-for-sale financial assets are recognised at fair value, plus transaction costs directly attributable to the acquisition of the financial asset. A gain or loss arising from a change in fair value is recognised directly in equity as revaluation reserve until the financial asset is derecognised, or until there is objective evidence that a financial asset incurred impairment losses. Investments in equities that are classified as assets available for sale but for which no price quotation on an active market is available, and the fair value of which cannot be reliably determined by other valuation methods, are recognised at their historical cost.
(b) Financial assets at fair value through profit or loss At initial recognition these financial assets are recognised at fair value. A gain or loss arising from a change in fair value of the financial asset is recognised through profit or loss.
These non-derivative financial assets with fixed or determinable payments that are not quoted in an active market are measured at amortised
Monetary and non-monetary assets and liabilities of foreign entities whose functional currency is not the currency of a hyperinflationary economy and is diffe rent from the euro are translated at the closing rate at the date of the balance sheet. Income and expenses for each income statement (including comparatives) are translated at exchange rates at the dates of the transactions. All resulting exchange differences are recognised as a separate component of equity.
Intangible assets other than goodwill Intangible assets consist of titles, software, concessions, copyrights, property rights and other rights etc. acquired from third parties or by contribution in kind, as well as any internally generated software.
Expenditure on research activities undertaken with the prospect of gaining new scientific or technical knowledge and understanding is recognised as an expense when it is incurred.
Expenditures on development activities, whereby the research findings are applied to a plan or design for the production of new or substantially improved products and processes, are only included in the balance sheet, if the product or process is technically and commercially feasible, the Group has sufficient resources available to complete the development and it is possible to demonstrate that the asset will generate probable future economic benefits.
Capitalised expenditure comprises the costs of materials, direct labour costs and a proportionate part of the overheads.
Intangible assets are measured at their cost, less any accumulative amortisation and any accumulated impairment losses.
Intangible assets are amortised in accordance with the straight-line methods starting when the asset is available for use over their expected useful life.
The following useful lives are applied:
» Scenarios 2 years » Other rights according to their expected useful life By virtue of IAS 38.107, most titles are considered as assets with indefinite useful lives which are not amortised but tested yearly for impairment. Other intangible assets with indefinite useful lives are also not amortised but subject to an annual impairment test.
Every half year, purchased intangible assets are examined to see whether they still fall into the indefinite life category. Where certain indications suggest that a particular asset has a finite remaining life, it will from then on be amortised over the remaining life.
Goodwill on acquisition of subsidiaries is recorded, as from the acquisition date, in the amount of the surplus of the total of the fair value of the consideration transferred, the amount of any minority interests and (in a business combination undertaken in stages) the fair value of the previously held equity interest, over the net balance of the net identifiable assets acquired and liabilities assumed. Where this total, after reassessment, results in a negative amount, this gain is immediately recognised in the income statement.
In accordance with IFRS 3 goodwill is not amortised but tested at least annually for impairment, more specifically each time there is an indication that a cash generating unit may be impaired.
Goodwill arising from the acquisition of a joint venture or an associate is considered to be an integral part of the carrying amount of the investment held in such entity and as a result not separately tested for impairment. The integral carrying amount of such an investment is tested for impairment in accordance with IAS 36 Impairment of assets.
Property, plant and equipment are recognised at cost less any accumulative depreciation and any impairment losses. The cost comprises the initial purchase price plus other direct purchase costs (such as non-refundable tax, transport). The cost of self-constructed property, plant and equipment comprises the cost of materials, direct labour costs and a proportional part of the production overheads.
The Group uses the exception provided for in IFRS 1 to treat the fair value of some of the property, plant
of a past event, when it is probable that an outflow of resources will be required to settle the obligation and when a reliable estimate can be made of the amount of the obligation.
If the Group expects that some or all of the expenditure required settling a provision will be reimbursed, the related asset is recognised once it is virtually certain that the reimbursement will be received.
A provision for restructuring is created when the Group approves a detailed and formalised restructuring plan and when the implementation of the restructuring plan has been started or the main features of the plan have been announced to those affected by it.
Several defined contribution plans exist within the Group. Under Belgian law, defined contribution pension plans are subject to minimum guaranteed rates of return. Because of these minimum guaranteed rates of return, all Belgian defined contribution plans are considered as a defined benefit plan under IFRS. These plans financed through group insurances, were accounted for as defined contribution plans in the past (before 2015). New legislation dated December 2015 involved the mandatory qualification as defined benefit plan. The cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period.
For the defined benefit pension plans, provisions are established by calculating the present actuarial value of future amounts to the employees concerned.
Defined benefit costs are split into 2 categories:
The total service cost, the net interest expense, the remeasurement of other long-term benefits, administrative expenses and taxes for the year are included in the employee benefit expense in the consolidated financial statement. The remeasurement on the net defined benefit liability is included in the statement of comprehensive income as part of other comprehensive income.
The Group also recognises a provision for early retirement pensions. The amount of the provision is equal to the present value of future benefits promised to the employees involved.
Various warrant and share option plans exist to enable executive and senior management to acquire shares of the company. IFRS 2 applies to all sharebased payment transactions allocated after 7 November 2002 and which had not become unconditional by 1 January 2005. The exercise price of an option is determined on the basis of the average closing price of the share during the thirty days prior to the option offering date or on the basis of the latest closing price prior to the offering date. The fair value of the option is calculated using the Black and Scholes formula. If and when the options are exercised, equity is increased by the amount received.
This mainly concerns both future tariff benefits on subscriptions, as jubilee premiums. The amount of these provisions equals the present value of these future obligations.
Financial liabilities Financial debts, other than derivative financial instruments, are initially recorded at the fair value of the financial resources received, less transaction costs. In subsequent periods, they are stated at amortised cost using the effective interest rate method. Where financial debts are hedged by derivative financial instruments that function as fair value hedging, these debts are valued at fair value.
Trade payables
Trade payables are recognised at their cost.
Tax expense (tax income) on the result for the financial year is the aggregate amount included in the profit or loss for the period in respect of current tax and deferred tax. Taxes are recognised as income or as expense and included in profit or loss for the period except to the extent that the tax arises from a transaction or event which is recognised directly in equity. In that case the taxes are also recognised directly to the equity.
Current taxes for current and previous periods are, to the extent unpaid, recognised as a liability. If the
cost. A gain or loss is recognised in profit or loss when the financial asset is impaired.
Rights on returns from tax shelter agreements are recorded as short-term investments as they are not aiming to structurally support the production company in developing its activities. Such investments are measured at fair value.
Inventories are measured at cost (purchase or manufacturing cost) in accordance with the FIFO method or, if lower, at net realisable value.
Manufacturing cost includes all direct and indirect costs necessary to bring the inventories to their pres ent location and condition.
The net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and the estimated costs necessary to make the sale.
Ageing or slowly rotating inventories are systematically written down.
Short-term trade receivables and other receivables are measured at cost less appropriate allowances for estimated irrecoverable amounts.
At the end of the financial year an estimate is made of doubtful debts on the basis of an evaluation of all outstanding amounts. Doubtful debts are written off in the year in which they were identified as such.
Cash and cash equivalents consist of cash and sight deposits, short-term deposits (under 3 months) and highly liquid investments which are easily convertible into a known cash amount and where the risk of a change in value is negligible.
Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered principally through a sales transaction rather than through continuing use. This condition is regarded as met only when the asset (or disposal group) is available for immediate sale in its pres ent condition subject only to terms that are usual and customary for sales of such asset (or disposal group) and its sale is highly probable. Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from the date of classification.
When the Group is committed to a sales plan in volving loss of control of a subsidiary, all of the assets and liabilities of that subsidiary are classified as held for sale when the criteria described above are met, regardless of whether the Group will retain a non-controlling interest in its former subsidiary after the sale.
When the Group is committed to a sales plan in volving disposal of an investment, or a portion of an investment, in an associate or joint venture, the investment or the portion of the investment that will be disposed of is classified as held for sale when the criteria described above are met, and the Group discontinues the use of the equity method in relation to the portion that is classified as held for sale. Any retained portion of an investment in an associate or a joint venture that has not been classified as held for sale continues to be accounted for by using the equity method. The Group discontinues the use of the equity method at the time of disposal when the disposal results in the Group losing significant influence over the associate or joint venture.
After the disposal takes place, the Group accounts for any retained interest in the associate or joint venture in accordance with IAS 39 unless the retained interest continues to be an associate or a joint venture, in which case the Group uses the equity method (see the accounting policy regarding investments in associates or joint arrangements above).
Non-current assets (and disposal groups) classified as held for sale are measured at the lower of their carrying amount and fair value less costs to sell.
Treasury shares (i.e. own shares) are presented as deduction of equity and reported in the statement of changes in equity. No gain or loss is recognised in the income statement on the sale, issuance or cancellation of treasury shares.
A provision is recognised when the Group has a pres ent obligation (legal or constructive) as a result
continued operation of the unit. For this, management has used a cash flow forecast based on a five-year business plan. Future cash flows are discounted based on a weighted average cost of capital. Cash flow forecasts after the last budget period are determined by extrapolating the above-mentioned forecasts, applying a growth rate.
In setting the weighted average cost of capital and the growth rate, account has been taken of the in terest rate and risk profile of Roularta Media Group as a whole. The assumptions are applied to all of the Group's cash flow generating units.
Fair value less selling costs is determined empirically, using a transaction multiple derived from comparable transactions in the media sector and from experience applied to the sales criterion, or on a market value based on similar transactions in the market.
The Group uses derivative financial instruments to hedge the exposure to changes in interest rates or currencies.
Derivative financial instruments are initially measured at fair value. After initial recognition the financial instruments are measured at fair value on the balance sheet date.
Cash flow or fair value hedge accounting is applied to all hedges that qualify for hedge accounting when the required hedge documentation is in place and when the hedge relation is determined to be effective.
When a derivative financial instrument hedges the variability in fair value of a recognised asset or liability, or hedges an unrecognised firm commitment, these financial instruments are qualified as fair value hedges. These financial instruments accounted for as fair value hedges are measured at fair value and presented in the line 'financial derivatives'. The gain or loss arising on hedging instruments is recognised in profit and loss. The hedged item is also measured at fair value in respect of the risk being hedged, with any gain or loss being recognised in the income statement.
Changes in the fair value of a hedging instrument that qualifies as an effective cash flow hedge are processed in equity, more specifically in the hedging
reserve.
Certain hedging transactions do not qualify for hedge accounting treatment according to the specific criteria of IAS 39 Financial Instruments: Recognition and Measurement, although they offer economic hedging according to the Group's risk policy. Changes in the fair value of such instruments are recognised directly in the income statement.
Crucial assessments and main sources of estimating uncertainties Preparing annual financial statement under IFRS rules requires management to make judgements, estimates and assumptions that influence the amounts included in the annual financial statements.
The estimates and related assumptions are based on past experience and on various other factors that are considered reasonable in the given circumstances. The outcomes of these form the basis for the judgement as to the carrying value of assets and liabilities where this is not evident from other sources. The actual outcomes can differ from these estimates. The estimates and underlying assumptions are regularly reviewed.
• Impairment losses on intangible assets and goodwill: the Group tests intangible assets and goodwill annually for impairment, and also in between where indications exist that the value of the intangible assets or goodwill could be impaired (see
• Deferred tax assets relating to tax losses carried forward and tax deductions are recognised only to the extent that it is probable that sufficient taxable profit will exist in the future to recover the carriedforward tax losses and tax deductions.
• Credit risk with respect to customers: management analyses thoroughly the outstanding trade receivables, taking into account ageing, payment history and credit insurance coverage (see Note 18).
• Provision for employee benefits: the defined benefit pensions are based on actuarial assumptions including the discount rate and expected return on fund investments (see Note 26).
amount already paid exceeds the amount due for those periods, the excess is recognised as an asset. For calculating the current tax for the current and prior periods the tax rates that have been enacted or substantively enacted by the balance sheet date are used.
Deferred taxes are accounted for using the 'liability' method for all temporary differences between the taxable basis and the book value for financial reporting purposes and this for both assets and liabilities. For calculation purposes the tax rates used are those that have been enacted or substantively enacted by the balance sheet date.
In accordance with this method, the Group must in case of a business combination recognise deferred taxes on the difference between the fair value of the acquired assets and the liabilities and contingent liabilities assumed and their taxable basis.
Deferred tax assets are only recognised when it is probable that taxable profit will be available against which the deductible temporary differences can be utilised. Deferred tax assets are derecognised when it is no longer probable that the related tax advantage will be realised.
Government grants that relate to assets are recognised at their fair value when there is reasonable assurance that the Group will comply with the conditions attaching to them and the grants will be received. The government grant is presented as deferred income.
Government grants to compensate costs incurred by the Group are systematically recognised as operating income in the same period in which these costs are incurred.
Revenue from sales is recognised when following conditions are met:
(e) the costs incurred or to be incurred can be measured reliably.
Advertising income in Printed Media is recognised upon publication of the issue in which the advertisement is placed. Advertising income in Audiovisual Media is recognised at the time of broadcasting. Income from newsstand and subscription sales is recognised at publication date of the issue.
Revenue from barter arrangements relate to sales transactions involving the sale of unequal services or goods between two parties. Such transactions are measured at fair value taking into account discounts which are customary for similar transactions that are not considered as barter transactions.
Financing costs are recognised as an expense in the period in which they are incurred.
For the Group's assets, in application of IAS 36, on each balance sheet date it is assessed whether there are any indications that an asset may be impaired. If such indication exists, the recoverable amount of the asset has to be estimated. The recoverable amount is the higher of an asset's or cash-generating unit's fair value less costs to sell and its value in use. An impairment loss is recognised when the book value of an asset, or the cash-generating unit to which the asset belongs, is higher than the recoverable amount. Impairment losses are recognised in the income statement.
Each cash-generating unit represents, per country, an identifiable group of assets with a similar risk profile, which generates cash inflows which are largely independent of the cash inflows from other asset categories. The following cash-generating units have been defined: News Belgium (Knack, Le Vif/L'Express, Krant van West-Vlaanderen, …), Lifestyle Belgium (Nest, Royals, Plus België, …), Business Belgium (Kanaal Z/Canal Z, Trends, Trends-Tendances, Trends Top, …), Free Press Belgium (Deze Week, De Zondag, Steps, …), Free Press other countries (Zeeuwsch-Vlaams Advertentieblad), and Entertainment Belgium.
The value in use is determined based on the discounted cash flow model, in particular the discounting of future cash flows resulting from the
The segment reporting has been prepared and based on combined figures showing a bridge with the consolidated figures in accordance with IFRS 11.
In accordance with IFRS 8 Operating Segments, the management approach is applied for the financial reporting of segmented information. This standard requires the segmented information to be reported to follow the internal reporting used by the company's main operating decision-making officer, based on which the internal performance of Roularta's operating segments is assessed and resources allocated to the various segments. For reporting purposes, Roularta Media Group is organised into two operating segments based on the activities: Printed Media and Audiovisual Media.
Printed Media includes the sale of publicity, and the production and sale of all printed publications of the Group, such as free sheets, newspapers, magazines, newsletters and books, as well as all related services, including internet, fairs and other line extensions. Audiovisual Media includes spot advertising on TV and radio, production and broadcasting, as well as all related services, including internet and line extensions.
The valuation rules of the business segments are the same as the valuation rules of the Group as described in Note 1, except for the presentation of joint ventures which have been recorded based on the proportional method of consolidation in the segment reporting. Intersegment pricing is determined on an arm's length basis.
The results of the operating segments are monitored by management as far as the net result, given that almost all the segments correspond to legal entities.
| 2016 in thousands of euros |
Printed Media |
Audiovisual Media |
Inter segment elimination |
Combined total |
Effect IFRS 11 |
Consoli dated total |
|---|---|---|---|---|---|---|
| Sales of the segment | 295,220 | 182,729 | -1,543 | 476,406 | -199,942 | 276,464 |
| Sales to external customers | 294,393 | 182,013 | 476,406 | -199,942 | 276,464 | |
| Sales from transactions with other segments |
827 | 716 | -1,543 | 0 | 0 | |
| Depreciation and write-down of (in)tangible assets |
-10,633 | -6,806 | -17,439 | 7,191 | -10,248 | |
| Write-down of inventories and receivables and provisions |
665 | -275 | 390 | 340 | 730 | |
| Share in the result of associated companies and joint ventures |
-1,134 | 0 | -1,134 | 19,328 | 18,194 | |
| Operating result (EBIT) | 10,640 | 24,132 | 34,772 | -9,885 | 24,887 | |
| Financial income | 1,529 | 23 | -118 | 1,434 | -21 | 1,413 |
| Financial expenses | -6,111 | -270 | 118 | -6,263 | 163 | -6,100 |
| Income taxes | -786 | -8,885 | -9,671 | 9,743 | 72 | |
| Net result from continuing operations |
5,272 | 15,000 | 20,272 | 0 | 20,272 |
| 2016 in thousands of euros |
Printed Media |
Audiovisual Media |
Inter segment elimination |
Combined total |
Effect IFRS 11 |
Consoli dated total |
|---|---|---|---|---|---|---|
| Net result from continuing operations |
5,272 | 15,000 | 20,272 | 0 | 20,272 | |
| Attributable to: | ||||||
| Minority interests | -1,200 | -1 | -1,201 | 0 | -1,201 | |
| Equity holders of Roularta Media Group |
6,472 | 15,001 | 21,473 | 0 | 21,473 | |
| Assets | 442,496 | 215,259 | -114,576 | 543,179 | -99,978 | 443,201 |
| - of which carrying amount of investments accounted for using the equity method |
761 | 0 | 0 | 761 | 126,378 | 127,139 |
| - of which investments in intangible assets and property, plant and equipment |
7,783 | 35,270 | 43,053 | -35,516 | 7,537 | |
| Liabilities | 227,499 | 110,933 | -19,309 | 319,123 | -99,977 | 219,146 |
| Sales to external customers break down as follows: |
||||||
| Advertising | 141,098 | 135,589 | 276,687 | -134,657 | 142,030 | |
| Subscriptions and sales | 84,413 | 14,909 | 99,322 | -35,319 | 64,003 | |
| Other services and goods | 68,882 | 31,515 | 100,397 | -29,966 | 70,431 |
| 2015 | in thousands of euros | Printed Media |
Audiovisual Media |
Inter segment elimination |
Combined total |
Effect IFRS 11 |
Consoli dated total |
|---|---|---|---|---|---|---|---|
| Sales of the segment | 308,130 | 164,096 | -1,199 | 471,027 | -180,801 | 290,226 | |
| Sales to external customers | 307,481 | 163,546 | 471,027 | -180,801 | 290,226 | ||
| Sales from transactions with other segments |
649 | 550 | -1,199 | 0 | 0 | 0 | |
| Depreciation and write-down of (in)tangible assets |
-9,668 | -4,553 | -14,221 | 4,892 | -9,329 | ||
| Write-down of inventories and receivables and provisions |
924 | -281 | 643 | 271 | 914 | ||
| Share in the result of associated companies and joint ventures |
-1,288 | 0 | -1,288 | 20,341 | 19,053 | ||
| Operating result (EBIT) | 16,281 | 24,256 | 40,537 | -9,174 | 31,363 | ||
| Financial income | 1,470 | 167 | -163 | 1,474 | -166 | 1,308 | |
| Financial expenses | -6,773 | -183 | 163 | -6,793 | 44 | -6,749 | |
| Income taxes | 44,639 | -7,846 | 36,793 | 9,296 | 46,089 | ||
| operations | Net result from continuing | 55,617 | 16,394 | 72,011 | 0 | 72,011 |
An analysis of the Group's sales is as follows:
| Sales | in thousands of euros | 2016 | 2015 |
|---|---|---|---|
| Advertising | 142,030 | 148,213 | |
| Subscriptions and sales | 64,003 | 65,973 | |
| Printing for third parties | 47,098 | 49,899 | |
| Line extensions & other services and goods | 23,333 | 26,141 | |
| Total sales | 276,464 | 290,226 | |
| Bartering contracts included in sales amount to € 18,060K (2015: € 18,367K). Adjusted sales, which is the comparable sales to last year, i.e. adjusted for changes in the consolidation scope, |
|||
| include: | |||
| Adjusted sales | |||
| in thousands of euros | 2016 | 2015 | |
| Advertising | 142,030 | 147,595 | |
| Subscriptions and sales | 64,005 | 65,782 | |
| Printing for third parties | 47,098 | 49,899 | |
| Line extensions & other services and goods | 23,294 | 26,140 | |
| Adjusted sales | 276,427 | 289,416 | |
| Changes in the consolidation scope | 37 | 810 |
Consolidated sales in 2016, which under IFRS 11 takes no account of joint ventures including Medialaan and Plus Magazine (in Belgium, the Netherlands and Germany), declined slightly (-4.7%, from 290 to 276 million euros). The decrease in advertising revenues at Local Media and the magazines (-6%) was offset by the strong performance of internet advertising revenue (+14%). Subscription revenue was virtually stable (-1%). Newsstand sales (-9%) dropped due to the disappearance of Belgian sales of Point de Vue. In addition, there was less commercial printing of the Group's former French magazines (-6%).
| 2015 in thousands of euros |
Printed Media |
Audiovisual Media |
Inter segment elimination |
Combined total |
Effect IFRS 11 |
Consoli dated total |
|---|---|---|---|---|---|---|
| Result from discontinued operations |
-7,770 | -7,770 | 0 | -7,770 | ||
| Attributable to: | ||||||
| Minority interests | -126 | -1 | -127 | 0 | -127 | |
| Equity holders of Roularta Media Group |
47,973 | 16,395 | 64,368 | 0 | 64,368 | |
| Assets | 455,573 | 180,852 | -114,322 | 522,103 | -72,422 | 449,681 |
| - of which carrying amount of investments accounted for using the equity method |
1,069 | 0 | 1,069 | 118,941 | 120,010 | |
| - of which investments in intangible assets and property, plant and equipment |
7,678 | 4,165 | 11,843 | -4,637 | 7,206 | |
| Liabilities | 247,850 | 83,789 | -19,055 | 312,584 | -72,420 | 240,164 |
| Sales to external customers break down as follows: |
||||||
| Advertising | 146,807 | 132,816 | 279,623 | -131,410 | 148,213 | |
| Subscriptions and sales | 86,450 | 0 | 86,450 | -20,477 | 65,973 | |
| Other services and goods | 74,224 | 30,730 | 104,954 | -28,914 | 76,040 |
The geographical segment information is divided into two geographic markets in which RMG is active: Belgium and other countries (the Netherlands, and in 2015 also Slovenia and Serbia). The following schedules of sales and non-current assets (*) are divided up according to the geographic location of the subsidiary.
| 2016 - from continuing operations | in thousands of euros | Belgium Other countries | Consoli dated total | |
|---|---|---|---|---|
| Sales of the segment | 274,767 | 1,697 | 276,464 | |
| Non-current assets (*) | 138,329 | 2,093 | 140,422 | |
| 2015 - from continuing operations | in thousands of euros | Belgium Other countries | Consoli dated total | |
| Sales of the segment | 287,496 | 2,730 | 290,226 |
(*) Non-current assets other than financial instruments, deferred tax assets, post employment benefit assets, and rights arising under insurance contracts.
Given the variety of the Group's activities and hence the diversity of its customer portfolio, there is no one external customer representing at least 10 percent of the Group's revenue. For the same reason there is no concentration of sales towards certain customers or customer groups.
| Employment in Full-Time Equivalents | 2016 | 2015 |
|---|---|---|
| Average number of staff | 1,350 | 1,374 |
| Total employment at the end of the period | 1,354 | 1,364 |
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Write-down of inventories | -321 | -168 |
| Reversal of write-down of inventories | 359 | |
| Write-down of trade receivables | -4,139 | -4,146 |
| Reversal of write-down of trade receivables | 4,143 | 4,594 |
| Reversal of write-down of loans | 634 | |
| Total write-down of inventories and receivables | 42 | 914 |
Based on the year-end evaluation the write-down of Roularta Books inventories and the write-down of trade receivables of the previous year are reversed and new provisions are recorded.
In 2016, the net reversal of write-down of inventories amounts to € 38K (2015: write-down of € 168K) and the net reversal of write-down of trade receivables amounts to € 4K (2015: € 448K). In addition, the write-down of the loan to Himalaya (€ 634K) has been reversed in 2015.
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Government grants | 2,562 | 4,217 |
| Gains on disposal of intangible assets and property, plant and equipment | 42 | 693 |
| Gains on (partial) disposal of subsidiaries or joint ventures | 398 | |
| Exchange differences | 19 | 48 |
| Miscellaneous financial income and cash discounts | 458 | 418 |
| Miscellaneous cross-charges | 380 | 357 |
| Dividends | 3 | 3 |
| Gain on disposal of other receivables | 15 | |
| Miscellaneous income | 296 | 551 |
| Total other operating income | 4,158 | 6,302 |
An analysis of the Group's services and other goods is as follows:
| in thousands of euros | 2016 | 2015 | |
|---|---|---|---|
| Transport and distribution costs | -18,132 | -17,645 | |
| Marketing and promotion costs | -22,727 | -23,139 | |
| Commission fees | -4,846 | -4,498 | |
| Fees | -26,352 | -27,413 | |
| Operating leases | -12,075 | -12,181 | |
| Energy | -2,207 | -2,443 | |
| Subcontractors and other deliveries | -10,939 | -11,179 | |
| Remuneration members of the board of directors | -419 | -463 | |
| Temporary workers | -2,326 | -1,960 | |
| Travel and reception costs | -692 | -1,150 | |
| Insurances | -429 | -241 | |
| Other services and other goods | -494 | -568 | |
| Total services and other goods | -101,638 | -102,880 |
Commission fees consist of commissions invoiced by third parties (commissions on newsstand sales and subscription commissions) and copyrights.
The fees include editorial, photos and general fees.
Subcontractors and other deliveries mainly consist of repair and maintenance costs, telecommunication costs and fuel costs.
Services and other goods decreased with € 1,242K or 1.2% compared to last year. The most important part of this decrease can be attributed to fees.
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Wages and salaries | -63,053 | -62,545 |
| Social security contributions | -21,204 | -22,323 |
| Share-based payments | -152 | -16 |
| Post employment benefit charges | -3,084 | -3,121 |
| Other personnel charges | -3,896 | -3,834 |
| Total personnel charges | -91,389 | -91,839 |
Post employment benefit charges in 2016 consist mainly of expenses related to the defined contribution plans of € 2,892K (2015: € 2,926K).
This mainly concerns Belgian schemes financed by group insurance policies that from 2015 are considered under IFRS as a defined benefit plan, see Note 26.
Other operating income primarily relates to government grants received by Roularta Media Group. Miscellaneous income contains in 2016 and 2015 the chargeouts of costs incurred.
The decrease in government grants resulted in a decrease in other operating income. This also declined, to a lesser extent, due to the capital gains realised in 2015 on the sale of tangible fixed assets.
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Other non-recurring costs - Kempenland | -6,706 | |
| Other non-recurring costs | -1,429 | |
| Other non-recurring costs - associates and joint ventures | -2,518 | |
| Other provisions - Kempenland | 6,941 | |
| Other provisions | 1,192 | |
| Non-recurring depreciations, amortisations and impairments | 634 | |
| Impairment losses | -2,218 | |
| Other | ||
| Late payment interests | -63 | |
| Non-recurring deferred taxes | 47,825 | |
| (Deferred) taxes related to restructuring and other non-recurring costs | 1,816 | |
| Total other non-recurring results | 0 | 45,474 |
In 2016 there were no significant non-recurring results. In 2015, Roularta Media Group NV recognised deferred tax assets for a total amount of € 47.8 million, based on the expected fiscal results of Roularta Media Group NV over the next five years. See also Notes 10 and 19.
The amount which the Group was condemned to pay in the dispute with Kempenland, was paid to the opposing party at the end of December 2015 (provisions were already set up before). See also Notes 24 and 25. In 2015, impairment losses were recorded for € 2.2 million, mainly on titles. See also Note 14.
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Interest income | 1,413 | 1,015 |
| Profits on hedging instruments that are not part of a hedge accounting relationship |
293 | |
| Financial income | 1,413 | 1,308 |
| Interest expense | -6,100 | -6,749 |
| Financial costs | -6,100 | -6,749 |
| Total net finance costs | -4,687 | -5,441 |
The increase in interest income is mainly due to the interest on the receivable related to the sale of the French activities (in 2015, there was revenue only in the second half). Interest expenses decreased as a result of lower outstanding financial debt. A description of the hedging instruments can be found in Note 31.
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Other taxes | -2,851 | -2,626 |
| Losses on disposal of intangible assets and property, plant and equipment | -24 | -9 |
| Losses on trade receivables | -317 | -501 |
| (Reversal of) less values / (less values) on other current receivables | -160 | 287 |
| Exchange differences | -3 | -42 |
| Payment differences and bank charges | -546 | -721 |
| Miscellaneous expenses | -1,819 | -9,042 |
| Total other operating expenses | -5,720 | -12,654 |
In the other operating expenses, the largest decline can be found in the item miscellaneous expenses because it contained the Kempenland damage compensation (€ 6.7 million) in 2015.
I. Restructuring costs
| in thousands of euros | 2016 | 2015 | |
|---|---|---|---|
| Redundancy costs | -3,535 | ||
| Restructuring costs: costs | 0 | -3,535 | |
| Provisions restructuring costs | -158 | ||
| Restructuring costs: provisions | 0 | -158 | |
| Total restructuring costs | 0 | -3,693 |
The redundancy costs 2015 relate to the Belgian companies of the Group.
Since no major new restructuring plans were launched in 2016 and 2015, from 2016 severance pay is included in personnel charges.
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| 2,006 | 6,869 | |
| 0 | 0 |
|---|---|
Non-current employee benefits - actuarial gain / loss 515 -76
| 515 | -76 |
|---|---|
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| A. Income taxes - current | ||
| Current period tax expense | -58 | -109 |
| Adjustments to current tax expense / income of prior periods | -15 | |
| Total current income taxes | -58 | -124 |
| B. Income taxes - deferred | ||
| Related to the origination and reversal of temporary differences | -1,401 | 100,369 |
| Related to the reversal of depreciation (+) or depreciation (-) of deferred tax assets |
1,531 | -54,156 |
| Total deferred income taxes | 130 | 46,213 |
| Total current and deferred income taxes | 72 | 46,089 |
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Result before taxes | 20,200 | 25,922 |
| Share in the result of associated companies and joint ventures | 18,194 | 19,053 |
| Result before taxes, excluding share in result of associated companies and joint ventures |
2,006 | 6,869 |
| Statutory tax rate | 33.99% | 33.99% |
| Tax using statutory rate | -682 | -2,335 |
| Adjustments to tax of prior periods (+/-) | -62 | -15 |
| Tax effect of non-tax deductible expenses (-) | -1,176 | -1,204 |
| Tax effect of non-taxable revenues (+) | 456 | 103,902 |
| Tax effect of not recognising deferred taxes on losses of the current period (-) | -1,043 | -55,304 |
| Tax effect from the reversal (utilisation) of deferred tax assets from previous years |
-31 | |
| Tax effect of recognising deferred taxes on tax losses of previous periods | 2,520 | 245 |
| Tax effect of different tax rates of subsidiaries in other jurisdictions | 10 | 33 |
| Other increase / decrease in tax charge (+/-) | 49 | 798 |
| Tax using effective rate | 72 | 46,089 |
| I. Movements in number of shares (ordinary shares) | |||
|---|---|---|---|
| ---------------------------------------------------- | -- | -- | -- |
| 2016 | 2015 |
|---|---|
| 13,141,123 | 13,141,123 |
| 0 | 0 |
| 13,141,123 | 13,141,123 |
| 13,141,123 | 13,141,123 |
| 612,825 | 641,150 |
| 500,625 | 569,800 |
| 12,515,767 | 12,486,031 |
| 95,919 | 31,269 |
| 95,919 | 31,269 |
| 12,611,686 | 12,517,300 |
The calculation of the basic earnings and diluted earnings per share are based on the following:
Net result available to common shareholders Weighted average number of shares, basic
Net result available to common shareholders Weighted average number of shares, diluted
| Amount of dividends proposed or declared after the balance sheet date but before authorisation of the financial statements, in thousands of euros |
6,267 | 6,253 |
|---|---|---|
| Gross dividend per share in € | 0.50 | 0.50 |
| Number of shares entitled to dividend on 31/12 | 13,141,123 | 13,141,123 |
| Number of own shares on 31/12 | -612,825 | -641,150 |
| 2016 | 2015 | |
|---|---|---|
| Amount of dividends proposed or declared after the balance sheet date but before authorisation of the financial statements, in thousands of euros |
6,267 | 6,253 |
| Gross dividend per share in € | 0.50 | 0.50 |
| Number of shares entitled to dividend on 31/12 | 13,141,123 | 13,141,123 |
| Number of own shares on 31/12 | -612,825 | -641,150 |
| Mutation of own shares 2017 (before General Meeting) | 4,900 | 5,275 |
| 12,533,198 | 12,505,248 |
There are no discontinued operations in 2016.
At the end of December 2014 the board of directors decided to discontinue its loss-making French activities on short term. The sale of the French activities to Altice Media Group was finalised on 9 June 2015. The partner shareholders of Roularta in Idéat Editions SA (subsidiaries included), and Aventin Immobilier SCI decided to exercise their pre-emption right. This sale was finalised on 1 December 2015.
| = | € 21,473K 12,515,767 |
= 1.72 |
|---|---|---|
| = | € 21,473K 12,611,686 |
= 1.70 |
The negative impact of the discontinued French operations amounts to € 7.8 million on 31 December 2015. This loss is recognised in the result from discontinued operations. This result is a combination of lower income from the French advertising market during the first half of the year and the final settlement of the sales operation during the second half of 2015.
| Result for the period from discontinued operations in thousands of euros |
2016 | 2015 |
|---|---|---|
| Sales | 79,707 | |
| Other gains | 13 | |
| 0 | 79,720 | |
| Expenses | -82,933 | |
| Operating result after net financing costs | 0 | -3,213 |
| Attributable income taxes | 0 | 0 |
| 0 | -3,213 | |
| Net result of minority share related to discontinued operations | 38 | |
| 0 | 38 | |
| Result on sale French activities | -4,595 | |
| Net result from discontinued operations | 0 | -7,770 |
| Cash flows from discontinued operations | in thousands of euros | 2016 | 2015 |
|---|---|---|---|
| Net cash flows from operating activities | 2,689 | ||
| Net cash flows from investing activities | -1,001 | ||
| Net cash flows from financing activities | -436 | ||
| Net cash flows from discontinued operations | 0 | 1,252 |
| 2015 | in thousands of euros | Titles | Software | Concessions, property rights and similar rights |
Total intangible assets |
Goodwill |
|---|---|---|---|---|---|---|
| AT COST | ||||||
| Balance at the end of the preceding period | 84,881 | 26,333 | 19,894 | 131,108 | 1,002 | |
| Movements during the period: | ||||||
| - Acquisitions | 2,891 | 9 | 2,900 | |||
| - Acquisitions through business combinations | 138 | 43 | 971 | 1,152 | 681 | |
| - Sales and disposals (-) | -2,683 | -301 | -2,984 | -681 | ||
| - Other increase / decrease (+/-) | 131 | -4,000 | -3,869 | |||
| At the end of the period | 82,336 | 29,097 | 16,874 | 128,307 | 1,002 | |
| DEPRECIATION AND IMPAIRMENT LOSSES | ||||||
| Balance at the end of the preceding period | 12,917 | 21,054 | 9,508 | 43,479 | 997 | |
| Movements during the period: | ||||||
| - Depreciation | 2,744 | 1,179 | 3,923 | |||
| - New consolidations | 43 | 43 | ||||
| income | - Impairment loss / reversal recognised in | 1,536 | 1,536 | 681 | ||
| - Written down after sales and disposals (-) | -2,664 | -249 | -2,913 | -681 | ||
| - Other increase / decrease (+/-) | 81 | -4,000 | -3,919 | |||
| At the end of the period | 11,789 | 23,673 | 6,687 | 42,149 | 997 | |
| Net carrying amount at the end of the period | 70,547 | 5,424 | 10,187 | 86,158 | 5 |
Intangible assets consist of development costs, titles, software, concessions, property and similar rights.
Development costs, software, titles, concessions, property and similar rights with finite lives are amortised over their estimated useful lives within the Group. Out of the total property rights, the carrying value of property rights having indefinite lives is € 6,173K.
Several titles and the goodwill have indefinite lives. The Group's titles and brands are well known and respected and contribute directly to cash flow.
Every half year, purchased intangible assets are examined to see whether they still fall into the indefinite life category. Where certain indications suggest that a particular asset has a finite remaining life, it will from then on be amortised over the remaining life.
In accordance with these valuation rules, the management of RMG concludes that for the cash generating unit Lifestyle, there is sufficient evidence for a change in estimate and for adjusting the expected life from indefinite to 3 years. For the absorption of the publication Inside Beleggen in the product Trends/Tendances, management also sees a change in estimate, and we will be adjusting the remaining expected life to 3 years. In 2016 (from July 1) € 646K was written off.
Titles, goodwill and certain property rights, all of which have an indefinite life, are not amortised, but subject to an annual impairment test.
| 2016 | in thousands of euros | Titles | Software | Concessions, property rights and similar rights |
Total intangible assets |
Goodwill |
|---|---|---|---|---|---|---|
| AT COST | ||||||
| Balance at the end of the preceding period | 82,336 | 29,097 | 16,874 | 128,307 | 1,002 | |
| Movements during the period: | ||||||
| - Acquisitions | 3,089 | 3,089 | ||||
| - Sales and disposals (-) | -124 | -3,352 | -3,476 | -5 | ||
| At the end of the period | 82,212 | 28,834 | 16,874 | 127,920 | 997 | |
| DEPRECIATION AND IMPAIRMENT LOSSES | ||||||
| Balance at the end of the preceding period | 11,789 | 23,673 | 6,687 | 42,149 | 997 | |
| Movements during the period: | ||||||
| - Depreciation | 720 | 2,806 | 1,322 | 4,848 | ||
| - Written down after sales and disposals (-) | -124 | -3,352 | -3,476 | |||
| At the end of the period | 12,385 | 23,127 | 8,009 | 43,521 | 997 | |
| Net carrying amount at the end of the period | 69,827 | 5,707 | 8,865 | 84,399 | 0 |
Roularta Media Group owns, in addition to the intangible assets that are recognised and carried in the accounts, also unrecorded and internally developed titles: Knack, Knack Weekend, Knack Focus, Le Vif Weekend, Focus Vif, Sport/Voetbalmagazine, Sport/Foot Magazine, Trends, Trends Style, Nest, Télépro, Plus Magazine, Deze Week, De Zondag, Steps, Krant van West-Vlaanderen, De Weekbode, De Zeewacht, Kortrijks Handelsblad,... Other internally generated trade names include Media Club, Vlan.be, Kanaal Z/Canal Z,...
The Group tests the value of intangible assets and goodwill with undefined lives annually for impairment, or more frequently where indications exist that these may have fallen in value. The test is based on the recoverable value of each CGU. At this level the book value is compared with its recoverable value (being the higher of fair value less costs to sell or value in use).
The Group has calculated the recoverable value of each CGU based on its value in use. For this it uses the discounted cash flow model. The future cash flows used in determining value in use are based on 5-year business plans, as approved by the board of directors. These business plans are based on historical data and future market expectations.
In the business plans that form the basis of impairment testing, management has included the following basic assumptions:
The residual value is determined based on a perpetuity formula which assumes a long-term growth in sales of 2% (2015: 2%). This is not higher than the long-term average growth rate of the media industry. The future cash flows are then discounted using an after-tax discount factor of 6.33% (2015: 7.24%; decrease mainly due to decrease of interest expense). Given the specific nature of the Group and its indebtedness as well as the limited availability of comparable companies in the media industry, the board of directors has decided to overweigh the indebtedness of the Group in the calculation of the discount factor. The board of directors concluded that the derived discount factor is appropriate for use in the impairment tests. This discount factor is based on a WACC model in which the risk premium and gearing ratio are based on the profile of Roularta Media Group as a whole and on a group of comparable companies.
Allocation of goodwill and intangible assets with indefinite lives to cash-generating units For the purpose of impairment testing, intangible assets with indefinite useful lives are allocated to a number of cash-generating units (CGU). Each CGU represents an identifiable group of assets having a similar risk profile, which generates cash inflows which are largely independent of the cash inflows from other asset categories. Due attention is paid here to the rapidly changing market situation in which various media channels and products interact strongly. The cash-generating units are defined based on the main cash inflows.
Carrying value of goodwill and intangible assets with indefinite lives:
| 2016 - Cash-generating unit |
in thousands of euros | Intangible assets (*) |
Goodwill | Total |
|---|---|---|---|---|
| News Belgium | 43,153 | 0 | 43,153 | |
| Business Belgium | 14,923 | 0 | 14,923 | |
| Free Press Belgium | 12,616 | 0 | 12,616 | |
| Free Press other countries | 2,083 | 0 | 2,083 | |
| 72,775 | 0 | 72,775 |
(*) Including € 66,602K titles and € 6,173K property rights.
| 2015 - Cash-generating unit |
in thousands of euros | Intangible assets (*) |
Goodwill | Total |
|---|---|---|---|---|
| News Belgium | 43,153 | 0 | 43,153 | |
| Lifestyle Belgium | 2,646 | 0 | 2,646 | |
| Business Belgium | 16,223 | 0 | 16,223 | |
| Free Press Belgium | 12,616 | 0 | 12,616 | |
| Free Press other countries | 2,083 | 0 | 2,083 | |
| Entertainment Belgium | 0 | 5 | 5 | |
| 76,721 | 5 | 76,726 |
(*) Including € 70,548K titles and € 6,173K property rights
| 2016 in thousands of euros |
Land and buildings |
Plant, machin ery & equip ment |
Furni ture and vehicles |
Leasing and other similar rights |
Other property, plant & equip ment |
Assets under construc tion |
Total |
|---|---|---|---|---|---|---|---|
| AT COST | |||||||
| Balance at the end of the preceding period | 89,946 | 22,474 | 9,880 | 33 | 197 | 0 122,530 | |
| Movements during the period: | |||||||
| - Acquisitions | 669 | 3,494 | 274 | 10 | 4,447 | ||
| - Sales and disposals (-) | -266 | -498 | -300 | -33 | -34 | -1,131 | |
| At the end of the period | 90,349 | 25,470 | 9,854 | 0 | 173 | 0 125,846 | |
| DEPRECIATION AND IMPAIRMENT LOSSES | |||||||
| Balance at the end of the preceding period | 38,999 | 18,359 | 7,955 | 33 | 160 | 0 | 65,506 |
| Movements during the period: | |||||||
| - Depreciation | 3,656 | 1,311 | 411 | 21 | 5,399 | ||
| - Written down after sales and disposals (-) | -266 | -469 | -280 | -33 | -34 | -1,082 | |
| At the end of the period | 42,389 | 19,201 | 8,086 | 0 | 147 | 0 | 69,823 |
| Net carrying amount at the end of the period | 47,960 | 6,269 | 1,768 | 0 | 26 | 0 | 56,023 |
| Assets pledged as security in thousands of euros |
|
|---|---|
| Land and buildings pledged as security for liabilities (mortgage included) | 10,708 |
As the local markets in which Roularta Media Group is operating are similar in terms of growth rate and risk profile, management of RMG has concluded that the same assumptions (growth rate and WACC) can be applied for all CGUs. The long-term growth rate has for this purpose also been benchmarked with external sources and properly reflects the expectations within the media industry.
Actual cash flows could differ from the cash flows projected in the major strategic business plans if the basic assumptions change. The following reasonably possible changes in key underlying assumptions have been tested, even though their occurrence is deemed unlikely:
Based on the tests mentioned above, no impairment loss on intangible fixed assets was recorded in 2016. In 2015, impairment losses were recorded for € 1,416K on the Lifestyle Belgium CGU and the Free Press other countries CGU. The headroom (difference between the value in use and the carrying amount) on the cash generating units is more than double the carrying amount of the unamortised intangible assets.
For goodwill, based on the above test, no impairment loss was recorded in 2016 and 2015.
The sale of the goodwill Himalaya results in an impairment loss on intangible assets (€ 120K) and on goodwill (€ 681K) in 2015.
I. Overview of significant joint ventures
The following joint ventures have a significant effect on the financial position and results of the Group.
| Name of joint venture | Main activity | Place of incorporation and principal place of business |
Proportion of ownership interest and voting rights of the Group |
|
|---|---|---|---|---|
| 2016 | 2015 | |||
| Medialaan Group | Audiovisual Media | Vilvoorde, Belgium | 50.00% | 50.00% |
| Bayard Group | Printed Media | Augsburg, Germany | 50.00% | 50.00% |
These joint ventures are accounted for by using the equity method of consolidation.
Condensed financial information related to these significant joint ventures of the Group is detailed below. Such financial information agrees to the financial reporting of the joint ventures in accordance with IFRS.
Medialaan Group consists of the entities Medialaan NV, JOEfm NV, TvBastards NV , Stievie NV and (from 2016 on) the companies around the Mobile Vikings brand and Bites NV.
| Condensed financial information | in thousands of euros | 2016 | 2015 |
|---|---|---|---|
| Fixed assets | 189,808 | 130,948 | |
| Current assets | 223,410 | 212,904 | |
| - of which cash and cash equivalents | 30,683 | 12,709 | |
| Non-current liabilities | -61,599 | -34,274 | |
| - of which financial liabilities | -28,000 | 0 | |
| Current liabilities | -130,786 | -103,179 | |
| - of which financial liabilities | -8,000 | -18 | |
| Net assets | 220,833 | 206,399 | |
| Sales | 344,933 | 307,301 | |
| Depreciation and amortisation | -13,232 | -8,729 | |
| Interest income | 40 | 325 | |
| Interest expense | -263 | -11 | |
| Income tax expense | -17,874 | -17,227 | |
| Net result for the period | 34,949 | 35,602 | |
| Other comprehensive income for the period | -515 | 0 | |
| Total comprehensive income for the period | 34,434 | 35,602 | |
| Dividends received during the period | 10,000 | 15,000 |
| 2015 | in thousands of euros | Land and buildings |
Plant, machin ery & equip ment |
Furni ture and vehicles |
Leasing and other similar rights |
Other property, plant & equip ment |
Assets under construc tion |
Total |
|---|---|---|---|---|---|---|---|---|
| AT COST | ||||||||
| Balance at the end of the preceding period | 91,005 | 21,607 | 9,660 | 33 | 146 | 0 122,451 | ||
| Movements during the period: | ||||||||
| - Acquisitions | 221 | 1,376 | 651 | 2,248 | ||||
| - Acquisitions through business combinations | 33 | 3 | 36 | |||||
| - Sales and disposals (-) | -1,280 | -510 | -449 | 44 | -2,195 | |||
| - Disposals through business divestiture (-) | -19 | -12 | -31 | |||||
| - Other increase / decrease (+/-) | 1 | 4 | 16 | 21 | ||||
| At the end of the period | 89,946 | 22,474 | 9,880 | 33 | 197 | 0 122,530 | ||
| DEPRECIATION AND IMPAIRMENT LOSSES | ||||||||
| Balance at the end of the preceding period | 35,870 | 17,580 | 7,988 | 22 | 68 | 0 | 61,528 | |
| Movements during the period: | ||||||||
| - Depreciation | 3,694 | 1,284 | 375 | 11 | 41 | 5,405 | ||
| - New consolidations | 30 | 3 | 33 | |||||
| - Written down after sales and disposals (-) | -565 | -505 | -423 | 60 | -1,433 | |||
| - Disposals through business divestiture (-) | -15 | -12 | -27 | |||||
| At the end of the period | 38,999 | 18,359 | 7,955 | 33 | 160 | 0 | 65,506 | |
| Net carrying amount at the end of the period | 50,947 | 4,115 | 1,925 | 0 | 37 | 0 | 57,024 |
| Assets pledged as security in thousands of euros |
|
|---|---|
| Land and buildings pledged as security for liabilities (mortgage included) | 13,709 |
| Leased property, plant and equipment of which the finance lease liabilities are secured by the lessor's title to the leased assets |
0 |
The heading 'leasing and other similar rights' comprises vehicles of a number of group companies with a carrying amount of € 0K.
| Condensed financial information | in thousands of euros | 2016 | 2015 |
|---|---|---|---|
| Fixed assets | 20,084 | 20,096 | |
| Current assets | 39,377 | 38,000 | |
| - of which cash and cash equivalents | 7,028 | 5,288 | |
| Non-current liabilities | -9,672 | -8,822 | |
| - of which financial liabilities | 0 | 0 | |
| Current liabilities | -20,207 | -20,316 | |
| - of which financial liabilities | 0 | 0 | |
| Net assets | 29,582 | 28,958 | |
| Sales | 59,000 | 60,103 | |
| Depreciation and amortisation | -659 | -553 | |
| Interest income | 19 | 53 | |
| Interest expense | -44 | -67 | |
| Income tax expense | -1,687 | -1,373 | |
| Net result for the period | 4,152 | 5,320 | |
| Other comprehensive income for the period | -45 | ||
| Total comprehensive income for the period | 4,107 | 5,320 | |
| Dividends received during the period | 1,741 | 1,668 |
Reconciliation of the above-mentioned financial information with the carrying amount of the investment of Bayard Group in the consolidated financial statements:
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Net assets of the joint venture | 29,582 | 28,958 |
| Share of the Group in Bayard Group | 50.00% | 50.00% |
| Carrying amount of the investment in Bayard Group | 14,791 | 14,479 |
Bayard Group is part of the Printed Media segment. Bayard Media is the magazine division aiming at the over 50 audience. In addition the Group publishes magazines for children and youth (Sailer Verlag). The largest decline in revenue concerns the magazines published by Senior Publications Nederland for third parties (-€ 0.5 million). In addition, there was a limited decline in advertising revenue and newsstand sales. This decline in revenue was only partly offset by lower costs, which together with the higher tax expense in 2016 resulted in a decrease in the result.
Roularta Media Group has no contractual obligations or limitations towards Bayard Group.
II. Summarised financial information of associates and joint ventures not individually significant
This category consists of the entities De Woonkijker NV, Regionale Media Maatschappij NV, Regionale TV Media NV, Proxistore NV, CTR Media SA, Click Your Car NV, Yellowbrick NV, Repropress CVBA, Twice Entertainment BVBA and Febelma Regie CVBA.
Reconciliation of the above-mentioned financial information with the carrying amount of the investment of Medialaan Group in the consolidated financial statements:
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Net assets of the joint venture | 220,833 | 206,399 |
| Share of the Group in Medialaan Group | 50.00% | 50.00% |
| Carrying amount of the investment in Medialaan Group | 110,417 | 103,200 |
Medialaan is part of the Audiovisual Media segment of the Group. On 11 February 2016, Medialaan, a 50% subsidiary of Roularta Media Group, acquired control of the companies around the Mobile Vikings brand and on 1 July 2016, Medialaan acquired television station Acht from Concentra and launched the new men's channel 'CAZ'.
The acquisition of the companies around the Mobile Vikings brand primarily comprises the company Unleashed NV (formerly VikingCo NV) and 3 smaller, non-active companies, two of which were already liquidated by the end of 2016.
The new participating interest accounts for an increase in revenues of € 31.6 million. The increased level of depreciation is primarily related to Mobile Vikings and CAZ. The net result is slightly lower than in 2015 due to higher net financing costs and taxes. Medialaan is achieving strong ratings but due to low visibility, we foresee no automatic extension into 2017 of the increased advertising revenues. Striking, however, is the growing revenue from new viewing patterns such as slightly delayed viewing via Proximus, Telenet and our own Stievie platform, and growing advertising revenue from online video.
Medialaan is involved in a tax claim from the Special Tax Inspectorate against one of its subcontractors concerning the taxation of phone-in quizzes organised in the 2008, 2009 and 2010. After the subcontractor was sentenced in first instance, it appealed the judgement, and Medialaan was also summoned in a third party action in 2014. In view of this summons, at the end of 2014 a provision of € 2.6 million was set aside by Medialaan. In a judgement of the court of appeal in December 2015, the ruling in first instance was largely confirmed. Based on the ruling of the court of appeal, Medialaan set aside an additional provision of € 3.9 million at the end of 2015, bringing the total provision to € 6.5 million. In the meantime, both the subcontractor and Medialaan have brought an appeal before the Belgian Supreme Court against the above judgement.
Roularta Media Group has no contractual obligations or limitations towards Medialaan Group.
Bayard Group consists of the entities Bayard Media GMBH & CO KG, Bayard Media Verwaltungs GMBH, Senior Publications SA, Senior Publications Nederland BV, Senior Publications Deutschland GMBH & CO KG, Senior Publications Verwaltungs GMBH, Belgomedia SA, J.M. Sailer Verlag GMBH, J.M. Sailer Geschäftsführungs GMBH, Living & More Verlag GMBH (in liquidation), 50+ Beurs & Festival BV, Press Partners BV, Mediaplus BV and Verlag Deutscher Tierschutz-Dienst GMBH.
All investments are considered as available for sale and are carried at fair value.
This applies mainly to NV Roularta Media Group's investments in NV Omroepgebouw Flagey (net carrying amount € 440K), in SA STM (net carrying amount € 0K) and in CPP-INCOFIN (net carrying amount € 124K). Given the impossibility of reliably estimating the fair value of the other investments, financial assets for which there is no active market are valued at cost. In 2016, an impairment was booked on these shares based on the equity and results of the companies concerned.
II. Loans and guarantees
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| AT AMORTISED COST | ||
| At the end of the preceding period | 1,853 | 3,630 |
| Movements during the period: | ||
| - Additions | 1,640 | |
| - Reimbursements | -12 | -3,417 |
| At the end of the period | 1,841 | 1,853 |
| IMPAIRMENT LOSSES | ||
| At the end of the preceding period | 0 | 0 |
| Movements during the period: | ||
| At the end of the period | 0 | 0 |
| Net carrying amount at the end of the period | 1,841 | 1,853 |
| Total | 2,470 | 2,844 |
| The loans and guarantees include various guarantees for € 1,841K (2015: € 1,853K) |
| I. Trade and other receivables, non current | in thousands of euros | 2016 | 2015 |
|---|---|---|---|
| Trade receivables | 0 | 0 | |
| Other receivables | 15,568 | 31,479 | |
| Total trade and other receivables - non current | 15,568 | 31,479 | |
| Other receivables are related to the sale of the French activities. These receivables are interest bearing and are guaranteed. |
At the end of the financial year, doubtful receivables are estimated based on an assessment of all outstanding amounts. Doubtful debtors are written off in the year in which they are identified as such.
In 2016 and 2015 there were no doubtful non current receivables.
| Condensed financial information | in thousands of euros | 2016 | 2015 |
|---|---|---|---|
| Share of the Group in the result for the period | -1,357 | -1,407 | |
| Share of the Group in other comprehensive income for the period | 0 | 0 | |
| Share of the Group in total comprehensive income for the period | -1,357 | -1,407 | |
| Total carrying amount of other investments held by the Group | 1,931 | 2,332 | |
| Amounts receivable of other investments held by the Group | 583 | 725 |
Roularta Media Group has no contractual obligations or limitations towards those associates and joint ventures.
III. Evolution net book value investments accounted for using the equity method
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Balance at the end of the preceding period | 120,011 | 116,700 |
| Movements during the period: | ||
| - Share in the result of associated companies and joint ventures | 18,194 | 19,053 |
| - Share of other comprehensive income of joint ventures and associates | -280 | |
| - Dividends | -11,741 | -16,668 |
| - Provision for additional losses | 107 | -464 |
| - Effect group change (2016: Proxistore; 2015: Proxistore & Himalaya) | 848 | 1,332 |
| - Other changes | 58 | |
| Balance at the end of the period (investments, amounts receivable not included) |
127,139 | 120,011 |
I. Available-for-sale investments
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| AT COST | ||
| At the end of the preceding period | 991 | 1,014 |
| Movements during the period: | ||
| - Disposals (-) | -1 | -23 |
| At the end of the period | 990 | 991 |
| IMPAIRMENT LOSSES (-) | ||
| At the end of the preceding period | 0 | 0 |
| Movements during the period: | ||
| - Impairment loss / reversal recognised in income | -361 | |
| At the end of the period | -361 | 0 |
| Net carrying amount at the end of the period | 629 | 991 |
| Movements during the period of the allowance in thousands of euros for doubtful debts (other receivables): |
2016 | 2015 |
|---|---|---|
| Net carrying amount at the end of the preceding period | -112 | -1,829 |
| - Amounts written off during the year | -150 | -5 |
| - Reversal of amounts written off during the year | 4 | 1,722 |
| Net carrying amount at the end of the period | -258 | -112 |
I. Overview deferred tax assets - liabilities
| Recognised deferred tax assets in thousands of euros and liabilities are attributable to: |
2016 | 2015 | ||
|---|---|---|---|---|
| Deferred tax assets |
Deferred tax liabilities |
Deferred tax assets |
Deferred tax liabilities |
|
| Intangible assets | 920 | 20,320 | 946 | 19,998 |
| Property, plant and equipment | 7 | 8,133 | 7 | 8,680 |
| Available-for-sale investments, loans, guarantees | 16 | 5,161 | 16 | 5,308 |
| Trade and other receivables | 128 | |||
| Treasury shares | 21 | 21 | ||
| Retained earnings | 1,423 | 1,713 | ||
| Provisions | 1,894 | 2,101 | 46 | |
| Non-current employee benefits | 1,446 | 999 | ||
| Other payables | 29 | |||
| Total deferred taxes related to temporary differences | 4,283 | 35,087 | 4,069 | 35,894 |
| Tax losses | 32,807 | 30,283 | ||
| Tax credits | 18,739 | 21,782 | ||
| Set off tax | -34,566 | -34,566 | -35,373 | -35,373 |
| Net deferred tax assets / liabilities | 21,263 | 521 | 20,761 | 521 |
Deferred tax assets have not been recognised in respect of tax losses for an amount of € 64,902K (2015: € 66,407K) and in respect of temporary differences of € 1K (2015: € 1K) because it is not probable that taxable profit will be available against which they can be utilised in the near future.
Roularta Media Group recognised deferred tax assets amounting to € 551K (2015: € 458K) of affiliates which suffered losses in the current or previous period. Budgets, however, indicate that these affiliates will generate sufficient taxable profit in the near future to utilise the recognised deferred tax assets.
| II. Trade and other receivables, current | in thousands of euros | 2016 | 2015 |
|---|---|---|---|
| Trade receivables, gross | 54,943 | 64,106 | |
| Allowance for bad and doubtful debts, current (-) | -4,123 | -4,180 | |
| Invoices to issue and credit notes to receive (*) | 3,590 | 2,359 | |
| Amounts receivable and debit balances suppliers | 896 | 956 | |
| VAT receivable (*) | 259 | 304 | |
| Other receivables, gross | 18,682 | 18,434 | |
| Allowance for other receivables | -258 | -112 | |
| Total trade and other receivables - current | 73,989 | 81,867 |
(*) Not considered as financial assets as defined in IAS 32
There was no significant concentration of credit risks with a single counterparty at 31 December 2016. The unsettled receivables are spread over a large number of customers, there is only one customer with an outstanding balance representing just over 10% of total trade receivables.
| Analysis of the age of current trade receivables: in thousands of euros |
2016 | 2015 |
|---|---|---|
| Net carrying amount at the end of the period | 54,943 | 64,106 |
| - of which: | ||
| * not due and due less than 30 days | 43,015 | 46,638 |
| * due 30 - 60 days | 3,102 | 3,807 |
| * due 61 - 90 days | 1,232 | 2,850 |
| * due more than 90 days | 7,594 | 10,811 |
Financial assets that have fallen due at reporting date, but on which no write-down has been taken: past-due amounts have not been written down where collection is still deemed likely.
At the end of the financial year, doubtful receivables are estimated based on an assessment of all outstanding amounts. Doubtful debtors are written off in the year in which they are identified as such.
| Movements during the period of the allowance in thousands of euros for bad and doubtful debts (trade debts): |
2016 | 2015 |
|---|---|---|
| Net carrying amount at the end of the preceding period | -4,181 | -4,584 |
| - Business combinations / business divestiture | -45 | |
| - Amounts written off during the year | -4,139 | -4,146 |
| - Reversal of amounts written off during the year | 4,143 | 4,594 |
| - Receivables derecognised as uncollectible and amounts collected in the financial year |
54 | |
| Net carrying amount at the end of the period | -4,123 | -4,181 |
In most Group companies, based on the year-end evaluation the provision from the end of the previous year is reversed and a new provision is recorded.
Realised losses on receivables (also on receivables provisioned at the end of the previous financial year) are detailed in Note 6.
| I. Short-term investments | in thousands of euros | 2016 | 2015 |
|---|---|---|---|
| AT COST | |||
| At the end of the preceding period | 306 | 721 | |
| Movements during the period: | |||
| - Reimbursements and sales | -415 | ||
| At the end of the period | 306 | 306 | |
| FAIR VALUE ADJUSTMENTS | |||
| At the end of the preceding period | -260 | 105 | |
| Movements during the period: | |||
| - Reimbursements and sales | -365 | ||
| At the end of the period | -260 | -260 | |
| Net carrying amount at the end of the period | 46 | 46 | |
| The short-term investments relate on the one hand to short-term investments that were redeemed in 2016: € 0K (2015: € 0K). On the other hand the short-term investments consist of rights to the producer's share in net income under a tax shelter agreement. On these, valuation allowances are recorded, where applicable, to reflect the evolution of the market value. |
|||
| II. Cash and cash equivalents | in thousands of euros | 2016 | 2015 |
| Bank balances | 45,233 | 22,990 | |
| Short-term deposits | 5,325 | 15,500 | |
| Cash at hand | 7 | 6 | |
| in thousands of euros | 2016 | 2015 | ||
|---|---|---|---|---|
| Tax losses carried forward |
Tax credits | Tax losses carried forward |
Tax credits | |
| Year of expiration | ||||
| 2017 | 140 | 140 | ||
| 2018 | 254 | 254 | ||
| > 5 year | ||||
| Without expiration date | 32,807 | 18,345 | 30,283 | 21,388 |
| Total deferred tax asset | 32,807 | 18,739 | 30,283 | 21,782 |
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Gross amount | ||
| Raw materials | 5,340 | 4,682 |
| Work in progress | 611 | 543 |
| Finished goods | 187 | 197 |
| Goods purchased for resale | 411 | 357 |
| Contracts in progress | 8 | 44 |
| Total gross amount (A) | 6,557 | 5,823 |
| Write-downs and other reductions in value (-) | ||
| Finished goods | -161 | -159 |
| Goods purchased for resale | -160 | -200 |
| Total write-downs (B) | -321 | -359 |
| Carrying amount | ||
| Raw materials | 5,340 | 4,682 |
| Work in progress | 611 | 543 |
| Finished goods | 26 | 38 |
| Goods purchased for resale | 251 | 157 |
| Contracts in progress | 8 | 44 |
| Total carrying amount at cost (A+B) | 6,236 | 5,464 |
Overview of the stock option plans to be exercised offered to the management and executive employees:
| Year of offering |
Options offered |
Options granted |
Options to be exercised |
Exercise price in € |
First exercise period |
Last exercise period |
|---|---|---|---|---|---|---|
| 2006 | 300,000 | 267,050 | 164,950 | 53.53 | 01/01 - 31/12/2010 | 01/01 - 31/12/2021 |
| 2008 | 300,000 | 233,650 | 135,400 | 40.00 | 01/01 - 31/12/2012 | 01/01 - 31/12/2023 |
| 2009 | 269,500 | 199,250 | 90,575 | 15.71 | 01/01 - 31/12/2013 | 01/01 - 31/12/2019 |
| 2015 | 203,750 | 114,700 | 109,700 | 11.73 | 01/01 - 31/12/2019 | 01/01 - 31/12/2025 |
| 1,073,250 | 814,650 | 500,625 |
Details of the share options outstanding during the year are as follows:
| 2016 | 2015 | |||
|---|---|---|---|---|
| Number of share options |
Weighted average exercise price in € |
Number of share options |
Weighted average exercise price in € |
|
| Outstanding at the beginning of the year | 569,800 | 33.58 | 490,800 | 38.11 |
| Granted during the year (settlement) | 114,700 | 11.73 | ||
| Forfeited during the year | -40,850 | 42.38 | -11,750 | 41.39 |
| Exercised during the year | -28,325 | 15.71 | -16,700 | 16.23 |
| Expired during the year | -7,250 | 21.93 | ||
| Outstanding at the end of the year | 500,625 | 33.87 | 569,800 | 33.58 |
| Exercisable at the end of the year | 323,585 | 337,605 |
During the year, 28,325 share options were exercised. In 2015, 16,700 share options were exercised. The share options outstanding at the end of the year have a weighted average remaining term of 6.05 years.
The weighted average share price at the date of exercise in 2016 was € 24.8 (2015: € 21.6).
To meet potential liabilities arising from stock options, the company introduced in the past a programme to purchase its own shares to enable it to partly meet these future options.
In 2016 the Group recognised € 152K (2015: € 16K) as personnel cost relating to equity-settled share-based payment transactions. All stock option plans granted as of 7 November 2002 are recognised in profit and loss.
At 31 December 2016, the issued capital amounted to € 80,000K (2015: € 80,000K) represented by 13,141,123 (2015: 13,141,123) fully paid-in ordinary shares. These are no-par shares.
At 31 December 2016 the Group owns 612,825 own shares (2015: 641,150).
During the financial year, 28,325 own shares were granted to the holders of options at the moment of the exercise of their options.
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Share premium | 304 | 304 |
| Costs of issuance and equity increase (net after deferred taxes) | -1,275 | -1,275 |
| Reserves for share-based payments | 5,628 | 5,476 |
| Reserves for actuarial gain / loss employee benefits | -1,691 | -685 |
| Total other reserves | 2,966 | 3,820 |
The reserves for share-based payments relate to the share options allocated as described in Note 23.
Various subscription rights and stock option plans have been issued by NV Roularta Media Group with the intention of allowing management and executive employees to benefit from the growth of the company and the evolution of the Roularta share. All subscription rights and stock option plans are settled in equity instruments, whereby each plan provides that one option or one subscription right entitles its holder to one Roularta share against payment of the exercise price. Options become unconditional when the employment contract or directorship has not ended at the time of the next exercise period. An overview of existing subscription rights and stock option plans follows.
There are no subscription rights outstanding per 31 December 2016.
The Appointments and Remuneration Committee decides on the allocation of the option plans as a function of executives' and managers' performance, their contribution to achieving Group objectives and their commitment to the long-term development of Group strategy.
The exercise price of an option is determined on the basis of the average closing price of the share during the thirty days prior to the option offering date or at the price corresponding to the last closing price preceding the offering date. The vesting period of the share options is stated in the following schedule. If the share option remains unexercised during the last exercise period, the share option expires. The share options which are not yet exercisable are forfeited if a member of management or an executive employee leaves the company before the last exercise period, except in case of retirement or decease.
Roularta Media Group is a party to proceedings before the Commercial Court with its former business partner Bookmark. A provision of € 578K has been set up for these proceedings.
NV Kempenland is claiming damages for failure to honour a printing contract with De Streekkrant-De Weekkrantgroep. The Turnhout Commercial Court condemned De Streekkrant-De Weekkrantgroep on 12 September 2013 in first instance to pay SA Kempenland the sum of: € 3.96 million in principal; € 4.06 million in overdue interest; the court costs. On appeal the ruling of the first court was broadly confirmed. However, NV Kempenland's claim for capitalisation of interest was rejected on appeal. The amount which NV Roularta Media Group was condemned to pay was paid to the opposing party at the end of December 2015. An appeal was filed by Roularta Media Group before the Belgian Supreme Court. The Belgian Supreme Court set aside the judgement only with respect to the amount of the litigation costs of appeal owed by the Roularta Media Group. The case was referred to the Ghent Court of Appeal. The pending discussion between Kempenland and RMG concerning allocation of the payments made during the course of the dispute and deposits paid against the final amount of the sentence pursuant to the judgement of the Court of Appeal (principal, interest and fees) was submitted for judgement to the attachment court of the judicial district of Ghent, Kortrijk division. For this pending discussion, Roularta Media Group set aside a provision of € 0.5 million at the end of 2015.
On 30 December 2011 a writ was served on NV Roularta Media Group and NV Vogue Trading Video by SAS QOL and SAS QOL FI for damages allegedly suffered from non-compliance with contractual obligations. The total claim amounts to € 4.7 million. The claim was dismissed in first instance by the Commercial Court of Brussels as completely unfounded. SAS QOL and SAS QOL FI have since lodged an appeal against this first judgement. The appeal has been initiated and deadlines have been set for each side to present its case. Based on the current contents of the dossier, Roularta Media Group management believes that it has sufficient legal arguments to refute this claim. No provision has therefore been set up.
With the acquisition of all shares of NV Coface Services Belgium (later on Euro DB) RMG inherited a pending legal dispute with InfoBase. InfoBase claims that the counterfeiting for which Coface Services Belgium was condemned in the past by the Nivelles Court of First Instance (judgement of 15 November 2006) has continued. Based on this judgement, whereby Coface Services Belgium SA was sentenced to immediate cessation of this counterfeiting under penalty of a fine of € 1,000 per day, InfoBase has proceeded systematically to claim periodic penalty payments. A provision of € 1.2 million has been set up for these penalty payments. By judgement of the Nivelles judge of attachments of 5 January 2015 Euro DB was sentenced to pay € 1.28 million of forfeited penalties and costs. This amount was placed by Euro DB on a blocked account with the Deposit and Consignment Office. Euro DB has appealed against the judgement of the Nivelles judge of attachments. Despite a positive decision of the court of first instance in Brussels on 12 February 2015, management decided late in 2015 to increase the existing provision by the amount of potential penalties and fees, or € 0.4 million, to € 2.1 million. The Brussels Court of Appeal ruled on 17 February 2017 that the appeal brought by InfoBase against the judgement of the Brussels court of first instance on 12 February 2015 was well-founded, and ordered Euro DB (now Roularta Media Group) to pay InfoBase compensation of € 39K in principal, plus the statutory interest from 1 June 2011 and the court costs. Based on an initial analysis of the judgement, an increase in the existing provision is not needed. The impact of the intervening judgement on the pending appeal concerning the deposits paid against the penalties is being investigated. Meanwhile counsel for InfoBase did announce that based on the judgement of 15 November 2006, it will continue to proceed with serving notice of the penalties.
| 2016 Provisions, non current in thousands of euros |
Legal proceeding provisions |
Environ mental provisions |
Restruc turing provisions |
Other provisions |
Total |
|---|---|---|---|---|---|
| At the end of the preceding period | 3,351 | 5 | 497 | 4,564 | 8,417 |
| Movements during the period: | |||||
| - Additional provisions | 762 | 762 | |||
| - Increase / decrease to existing provisions | 50 | 107 | 157 | ||
| - Amounts of provisions used (-) | -1 | -1,358 | -1,359 | ||
| - Unused amounts of provisions reversed (-) | -100 | -100 | |||
| - Other increase / decrease | -497 | -497 | |||
| At the end of the period | 3,301 | 4 | 0 | 4,075 | 7,380 |
Provisions for pending disputes relate largely to disputes at NV Roularta Media Group. A description of the significant litigations can be found in Note 25. The environmental provisions relate to provisions for soil decontamination. The restructuring provisions at the end of 2015 were transferred in 2016 to the provision for redundancy payments under non-current employee benefits. The other provisions include the provision for the remaining lease obligations related to a disused printing press.
| 2015 Provisions, non current in thousands of euros |
Legal proceeding provisions |
Environ mental provisions |
Restruc turing provisions |
Other provisions |
Total |
|---|---|---|---|---|---|
| At the end of the preceding period | 9,903 | 9 | 338 | 6,586 | 16,836 |
| Movements during the period: | |||||
| - Additional provisions | 102 | 300 | 402 | ||
| - Increase / decrease to existing provisions | 366 | 366 | |||
| - Amounts of provisions used (-) | -6,941 | -4 | -141 | -1,558 | -8,644 |
| - Unused amounts of provisions reversed (-) | -79 | -464 | -543 | ||
| At the end of the period | 3,351 | 5 | 497 | 4,564 | 8,417 |
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| A. Amounts recognised in the balance sheet | ||
| 1. Net funded defined benefit plan obligation (asset) | 412 | 152 |
| 1.1. Present value of funded or partially funded obligation | 36,025 | 1,973 |
| 1.2. Fair value of plan assets (-) | -35,613 | -1,821 |
| 2. Present value of wholly unfunded obligation | 0 | 0 |
| 3. Reclassification: Belgian contribution plans | 65 | |
| Defined benefit plan obligation, total | 412 | 217 |
| B. Net expense recognised in income statement and other comprehensive income |
||
| Recognised in income statement | ||
| 1. Current service cost | 2,578 | 63 |
| 2. Interest cost (+) | 766 | 42 |
| 3. Interest income (-) | -794 | -30 |
| 4. Past service cost (Belgian contribution plans) | 65 | |
| Total net expense recognised in income statement | 2,550 | 140 |
| Recognised in other comprehensive income | ||
| 1. Net actuarial (gain) loss recognised | 48 | -486 |
| Total net expense recognised in other comprehensive income | 48 | -486 |
| Net expense recognised in income statement and other comprehensive income | 2,598 | -346 |
| C. Movements in the present value of the defined benefit plan obligation | ||
| Present value of the defined benefit plan obligation, beginning balance | 31,694 | 1,936 |
| 1. Current service cost | 2,578 | 63 |
| 2. Interest cost | 766 | 42 |
| 3. Net actuarial (gain) loss recognised | 3,271 | -66 |
| - of which actuarial (gain) loss due to experience adjustments | 643 | 5 |
| - of which actuarial (gain) loss due to changes in valuation | 2,627 | -71 |
| 4. Contribution by the plan's participants | 351 | 19 |
| 5. Benefits paid (-) | -2,635 | -12 |
| 6. Reclassification: Belgian contribution plans | 29,721 | |
| 7. Other increase / decrease (+/-) | -9 | |
| Present value of the defined benefit plan obligation, ending balance | 36,025 | 31,694 |
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Defined benefit plans | 412 | 217 |
| Redundancy payments | 356 | |
| Other long-term employee benefits | 4,311 | 3,310 |
| Future tariff benefits on subscriptions | 645 | 613 |
| Employee retirement premiums | 470 | 587 |
| Jubilee premiums | 3,196 | 2,110 |
| At the end of the period | 5,079 | 3,527 |
II. Defined benefit plans
Various defined benefit pension plans exist within the Group, whereby remuneration is dependent on the number of years' service and salary levels.
For the Belgian plans the assets are held in funds as required by law.
For each plan the pension costs are calculated separately by an actuary based on the 'projected unit credit' method. Using this method obligations in respect of previous years' service and built-up fund investments are calculated, with the difference between the two (net value) shown by the Group in the balance sheet.
Under Belgian law, defined contribution plans are subject to minimum guaranteed rates of return. For contributions paid until the end of 2015, the employer has to guarantee an average minimum return of 3.75% on employee contributions and of 3.25% on employer contributions. As from 2016 onwards, the minimum guaranteed rate of return on new contributions will be linked to the yield of Belgian linear bonds with a term of 10 years, with a minimum of 1.75% and a maximum of 3.75%. These returns are being calculated as an average over the service period of the employee. Because of this minimum guaranteed rate of return, all Belgian defined contribution plans are considered as a defined benefit plan under IFRS. These plans financed through group insurances, were treated as defined contribution plans before 2015, as higher interest rates were applicable and the return on pension plans provided by insurance companies was sufficient to meet the minimum rate of return requirements.
The major categories of plan assets, and the percentage that each major category constitutes of the fair value of the total plan assets, are as follows:
| 2016 | 2015 | ||
|---|---|---|---|
| Fixed income securities and cash | 4.2% | 5.1% | |
| Equity instruments | 0.2% | 0.3% | |
| Property | 0.3% | 0.3% | |
| Insurance contract | 95.3% | 94.2% | |
| The Group expects to make a contribution of € 2,153K to the defined benefit plans (including the Belgian group insurance contracts) in 2017. |
|||
| Sensitivity With respect to these defined benefit plans, the Group is exposed to risks related to the decrease in the interest rate (discount rate), which will give rise to an increase in liabilities. |
|||
| III. Defined contribution plans Several defined contribution plans exist within the Group. For the Belgian plans the Law on Supplementary Pensions provides that the employer must guarantee a minimum return (see Note 26 section II). Because of this minimum guaranteed rate of return, all Belgian defined contribution plans are considered as a defined benefit plan under IFRS as from 2015. |
|||
| Summary of defined contribution plans (including Belgian plans) |
in thousands of euros | 2016 | 2015 |
| Contributions paid - employer | 2,892 | 2,926 |
IV. Stock options and subscription rights We refer to Note 23.
| 2016 | in thousands of euros | Current | Non current | |||
|---|---|---|---|---|---|---|
| Financial debts | Up to 1 year | 2 years | 3 to 5 years over 5 years | Total | ||
| Debentures | 99,914 | 99,914 | ||||
| Credit institutions | 2,229 | 776 | 1,960 | 3,175 | 8,140 | |
| Total financial debts according to their maturity | 2,229 | 100,690 | 1,960 | 3,175 | 108,054 |
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| D. Movements in the fair value of plan assets | ||
| Fair value of plan assets, beginning balance | 31,477 | 1,317 |
| 1. Interest income | 794 | 30 |
| 2. Return on assets, excluding amounts included in interest income | 3,222 | 420 |
| 3. Contributions by employer | 2,404 | 47 |
| 4. Contribution by the plan's participants | 351 | 19 |
| 5. Benefits paid (-) | -2,635 | -12 |
| 6. Reclassification: Belgian contribution plans | 29,656 | |
| Fair value of plan assets, ending balance | 35,613 | 31,477 |
| E. Principal actuarial assumptions | ||
| 1. Discount rate | 2.01% | 2.5% |
| 2. Expected return on plan assets | 2.01% | 2.5% |
| 3. Expected rate of salary increase | 3.0% | 3.0% |
| 4. Future defined benefit increase | 2.0% | 2.0% |
| in thousands of euros | 2016 | 2015 | 2014 | 2013 |
|---|---|---|---|---|
| Present value of defined benefit obligation | 36,025 | 1,973 | 1,936 | 6,078 |
| Fair value of plan assets | 35,613 | 1,821 | 1,317 | 756 |
| Deficit / (surplus) | 412 | 152 | 619 | 5,322 |
| Experience adjustments on plan liabilities: increase (decrease) | 643 | 5 | 271 | -115 |
| Return on assets, excluding amounts included in interest income |
3,222 | 420 | -3 | 7 |
For defined benefit pension plans a defensive investment strategy is applied, with investment mainly in fixed income securities, so as to guarantee the safety, return and liquidity of the investments, with judicious diversification and spread of investments.
| in thousands of euros | Current Up to 1 year |
2 years | Non current | |||
|---|---|---|---|---|---|---|
| 3 to 5 years over 5 years | Total | |||||
| 48,086 | 48,086 | |||||
| 19,841 | 19,841 | |||||
| 18,008 | 18,008 | |||||
| 11,224 | 11,224 | |||||
| - of which payables to Public Administrations | 6,784 | 6,784 | ||||
| 1,630 | 1,630 | |||||
| 20,277 | 37 | 20,314 | ||||
| Accrued charges and deferred income | 5,598 | 5,598 | ||||
| Total amount of payables according to their | 113,440 | 0 | 0 | 37 | 113,477 | |
| 2016 | 2015 | |||||
| 33,219 | ||||||
| in thousands of euros | 27,949 |
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| 27,949 | 33,219 | |
| 13,438 | 14,091 | |
| 879 | 776 | |
| 42,266 | 48,086 | |
| Current other payables | in thousands of euros | 2016 | 2015 | ||||
|---|---|---|---|---|---|---|---|
| Indirect tax payable (*) | 4,894 | 4,410 | |||||
| Other payables | 11,348 | 15,867 | |||||
| Total current other payables | 16,242 | 20,277 | |||||
| Indirect taxes relate primarily to VAT, advance income tax and provincial and municipal taxes. | |||||||
| Accrued charges and deferred income | in thousands of euros | 2016 | 2015 | ||||
| Accrued interest | 1,195 | 1,212 | |||||
| Accrued charges and deferred income (*) | 6,522 | 4,386 | |||||
| Total accrued charges and deferred income | 7,717 | 5,598 |
(*) No financial liability as defined in IAS 32.
| 2015 | in thousands of euros | Current | Non current | |||
|---|---|---|---|---|---|---|
| Financial debts | Up to 1 year | 2 years | 3 to 5 years over 5 years | Total | ||
| Debentures | 99,865 | 99,865 | ||||
| Finance leases | 6 | 6 | ||||
| Credit institutions | 2,856 | 2,021 | 3,211 | 6,263 | 14,351 | |
| Total financial debts according to their maturity | 2,862 | 2,021 | 103,076 | 6,263 | 114,222 |
In September 2012, RMG carried out a public bond offering. With an issue date of 10 October 2012, this six-year, € 100 million bond offered a fixed annual gross interest rate of 5.125%.
The Group's lenders, except for its bond holders, have imposed covenants calculated on combined financial information where joint ventures are consolidated using the proportionate method of consolidation. These covenants relate to the debt ratio (net financial debt/EBITDA must be less than 3), interest coverage (EBITDA/ net financing expenses must be greater than 4), gearing (net debt/equity must be less than 80%), solvency (minimum 25%) and dividends. The Group did not breach any of its covenants imposed on 31 December 2016.
The guaranteed debts included in the financial debts can be summarised as follows (in thousands of euros): Credit institutions 3,747
| These are guaranteed by (in thousands of euros): | |
|---|---|
| Mortgages registered on the Group's land and buildings | 11,000 |
| Pledges | 2,500 |
For further information on the Group's exposure to interest and exchange rate risks, see Note 31 Financial instruments – risks and fair value.
| 2016 | in thousands of euros | Current | Non current | |||
|---|---|---|---|---|---|---|
| Trade and other payables | Up to 1 year | 2 years | 3 to 5 years over 5 years | Total | ||
| Trade payables | 42,266 | 42,266 | ||||
| Advances received | 17,582 | 17,582 | ||||
| Current employee benefits | 13,497 | 13,497 | ||||
| - of which payables to employees | 10,764 | 10,764 | ||||
| - of which payables to Public Administrations | 2,733 | 2,733 | ||||
| Taxes | 771 | 771 | ||||
| Other payables | 16,242 | 37 | 16,279 | |||
| Accrued charges and deferred income | 7,717 | 7,717 | ||||
| maturity | Total amount of payables according to their | 98,075 | 0 | 0 | 37 | 98,112 |
The Group doesn't provide securities for obligations anymore (2015: € 0K). Pledges totalling € 2,500K (2015: € 2,500K) were given on business assets.
The Group's contractual obligations to buy paper from third parties amount to € 2,437K (2015: € 4,312K).
There are no material contractual obligations to acquire property, plant and equipment.
In the exercise of its business activity the Group is exposed to currency, interest rate, credit and market risks. Derivatives are used to reduce the currency and interest risks.
The Group is subject to a currency risk with respect to USD. The currency risks identified by management relate to the (expected) purchases in USD in the Audiovisual Media segment and to activities outside the euro-zone. Other than that, the Group runs to some extent currency risks with respect to its operating activities.
With regard to the purchases and the firm commitments to purchase film rights in USD in the Audiovisual Media segment, the Group uses foreign exchange contracts to hedge the risk of changes in the fair value of a recognised asset or liability, or a non-recognised definite undertaking in the context of its commercial activities. The forward contracts used for these hedges do not have a direct impact on the financial position or results of the Group as these instruments are only used by associates which are consolidated by the equity method and, therefore, are only reflected in the share in the result of associates and joint ventures. Despite these hedging instruments, fluctuations in the USD can have a limited impact on the Group's operating results.
As of 31 December 2016 and 31 December 2015, there are no financing activities with a potential currency risk.
Management is of the opinion that, given the above-mentioned hedging of the foreign exchange risks, the risks of fluctuations in the fair value or in the future cash flows of financial instruments which impact the profit or equity as a result of exchange rate changes, are not material.
The maturity dates of the financial debts and liabilities are given in Note 27.
The debentures and loans of credit institutions have fixed or variable interest rates.
I. Finance leases
| Present value of minimum lease payments |
Minimum lease payments |
|||
|---|---|---|---|---|
| in thousands of euros | 2016 | 2015 | 2016 | 2015 |
| No later than 1 year | 6 | 7 | ||
| 0 | 6 | 0 | 7 | |
| Less future finance charges | -1 | |||
| Present value of minimum lease payments | 0 | 6 | 0 | 6 |
| Included in the financial debt as: | ||||
| Current finance lease | 6 | |||
| 0 | 6 |
The finance lease agreements concluded by the Group related to vehicles. At the end of 2016 there were no more ongoing finance leases.
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Interest recognised as an expense in the period related to finance lease | 0 | 1 |
The interest portion of the financial lease is charged to income over the term of the lease.
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| Lease payments recognised as an expense in the period | 12,075 | 12,181 |
The Group mainly rents buildings, machines, company cars and office equipment. Operating lease payments are expressed in the income statement on a straight-line basis over the lease term.
| Non-cancellable future minimum operating lease payments: |
in thousands of euros | 2016 | 2015 |
|---|---|---|---|
| < 1 year | 12,698 | 13,427 | |
| 1 to 5 years | 13,284 | 23,096 | |
| > 5 years | 7 | 2 | |
| 25,989 | 36,525 |
As there are no loans outstanding in 2016 that carry a variable interest rate, the Group is not subject to sensitivity related to interest rate fluctuations per 31 December 2016.
The Group is exposed to credit risk on its customers, which could lead to credit losses.
To control this credit risk, credit investigations are performed on customers which request major credit facilities. Where the outcome is negative, credit is refused or restricted. In addition, the Group also uses trade finance instruments, such as letters of credit, to cover its credit risk and credit insurances are concluded for a limited percentage of the foreign clients of the printing works.
There was no significant concentration of credit risks with a single counterparty at 31 December 2016.
Despite RMG's intention of limiting its credit risk, it can face a deterioration of the creditworthiness of its customers. Any failure to conclude a credit insurance policy with respect to certain customers can have a material adverse effect on RMG's business, financial condition and/or results.
The carrying value of the financial assets presents the Group's maximum exposure to credit risk. The carrying value is reported including impairments. An overview of this carrying value can be found under item F. Impairment charges are detailed in Note 18.
An analysis of the maturity dates of the financial liabilities can be found in Note 27 and is summarised below, together with the interest costs.
RMG's indebtedness and the restrictions agreed upon in the financing agreements may adversely affect RMG's liquidity position. Any breach of covenants can lead to the loans being immediately due and payable.
The Group expects to meet its obligations through operating cash flows and current liquid assets. In addition, the Group has various short-term credit lines for a total amount of € 8,000K (2015: € 26,000K). These credit lines form an additional working capital buffer. No specific maturity is guaranteed on these credit lines by the lenders. At the end of 2016 and 2015, no use was made of these credit lines.
RMG manages the cash and financing flows and the resulting risks through a treasury policy at group level. In order to optimise the equity positions and minimise the related interest expenses, the cash flows of the subsidiaries within the Group are centralised as far as possible in a cash pool.
The table below summarises the effective interest rates at balance sheet date of these interest-bearing loans (debentures and credit institutions):
| Interest rate | in thousands of euros | 2016 | 2015 | Effective interest rate |
|---|---|---|---|---|
| Fixed interest rate | 360 | 600 | from 1.5% to 3.5% | |
| Fixed interest rate | 101,236 | 102,981 | from 4% to 6% | |
| Fixed interest rate with variable margin | 5,875 | 9,800 | from 2.5% to 5.5% |
Next to these loans, at 31 December 2016, the Group had negative overdrafts with credit institutions for € 583K (2015: € 841K). These carried variable market interest rates.
Loans towards associates and joint ventures, which are recorded under other loans, have a fixed interest rate which is revisable after three or five years.
In order to hedge the risks of unfavourable interest rate fluctuations, the Group has used financial instruments (IRS contracts) in the past.
As of 31 December 2016 and 31 December 2015, there were no financial instruments which meet the requirements defined in IAS 39 and are therefore regarded as cash flow hedging contracts.
Alongside these are a number of contracts that do not meet the conditions of IAS 39 to be viewed as hedging contracts.
By the end of 2016, like by the end of 2015, there were no such contracts anymore.
The impact of the evolution in the market values (before taxes) of these financial instruments can be summarised as follows:
| 2015 | in thousands of euros | Evolution market values |
Recognised in equity |
Recognised in profit and loss |
|---|---|---|---|---|
| Interest Rate Swap | ||||
| No cash flow hedge | 293 | 293 | ||
| 293 | 0 | 293 |
The changes which have been recognised in the income statement are included under the financial results.
| 2016 | 2015 | |||||
|---|---|---|---|---|---|---|
| in thousands of euros | Note | Carrying amount |
Fair value | Carrying amount |
Fair value | |
| Non-current liabilities | ||||||
| Financial debts | 27 | -105,825 | -111,474 | -111,360 | -112,708 | |
| Other payables | 28 | -37 | -37 | -37 | -37 | |
| Current liabilities | ||||||
| Financial debts | 27 | -2,229 | -2,502 | -2,862 | -3,397 | |
| Trade payables | 28 | -28,828 | -28,828 | -33,995 | -33,995 | |
| Advances received | 28 | -17,582 | -17,582 | -19,841 | -19,841 | |
| Other payables | 28 | -11,348 | -11,348 | -15,867 | -15,867 | |
| Accrued interests | 28 | -1,195 | -1,195 | -1,212 | -1,212 |
We mention below the main methods and assumptions used for estimating the fair values of financial instruments which are included in the overview.
As mentioned in Note 17, because no reliable estimate can be made of the fair values of the investments in this heading, financial assets for which no active market exists are valued at cost.
For amounts receivable and payable with original maturities of under one year, the nominal value is deemed to reflect the fair value, given the short maturities. For amounts receivable after one year it has been established that carrying value reflects the fair value.
The fair value of loans and finance leases is calculated based on the present value of the expected future cash flows of redemption and interest payments.
For short-term liabilities the nominal value is deemed to reflect the fair value, given the short maturities. For trade payables with terms of more than one year it has been established that the carrying value reflects the fair value. For financial derivatives the fair value is established on the basis of the market valuation at balance sheet date.
| Financial debts 2016 in thousands of euros | Current | Non current | ||||
|---|---|---|---|---|---|---|
| Up to 1 year | 2 years | 3 to 5 years | over 5 years |
Total | ||
| Total financial debts according to their maturity | 2,229 | 100,690 | 1,960 | 3,175 | 108,054 | |
| Interest costs | in thousands of euros | Current | Non current | |||
| Up to 1 year | 2 years | 3 to 5 years | over 5 years |
Total | ||
| Debentures | 5,125 | 5,125 | 10,250 | |||
| Credit institutions | 238 | 184 | 421 | 289 | 1,132 |
Roularta Media Group is constantly seeking to improve its balance sheet structure (combination of debt and equity). The main objective of its balance sheet structure is to maximise shareholder value whilst retaining the desired financial flexibility for undertaking strategic projects.
In analysing the balance sheet structure we use the IFRS classifications for distinguishing between equity and debt.
The fair value and carrying amount of the recognised financial assets and liabilities amount to:
| 2016 | 2015 | ||||
|---|---|---|---|---|---|
| in thousands of euros | Note | Carrying amount |
Fair value | Carrying amount |
Fair value |
| Non-current assets | |||||
| Available-for-sale investments, loans and guarantees |
17 | 2,470 | 2,470 | 2,844 | 2,844 |
| Trade and other receivables | 18 | 15,568 | 15,568 | 31,479 | 31,479 |
| Current assets | |||||
| Trade and other receivables | 18 | 70,140 | 70,140 | 79,204 | 79,204 |
| Short-term investments | 21 | 46 | 46 | 46 | 46 |
| Cash and cash equivalents | 21 | 50,565 | 50,565 | 38,496 | 38,496 |
The fair value of the assets and liabilities of the acquired subsidiaries on the date of acquisition that fit the recognition principles of IFRS 3 Business Combinations and the amounts paid are presented as follows:
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| ASSETS | ||
| Non-current assets | 0 | 1,143 |
| Intangible assets | 1,109 | |
| Property, plant and equipment | 4 | |
| Available-for-sale investments, loans and guarantees | 3 | |
| Deferred tax assets | 27 | |
| Current assets | 0 | 254 |
| Trade and other receivables | 251 | |
| Cash and cash equivalents | 3 | |
| Total assets | 0 | 1,397 |
| LIABILITIES | ||
| Non-current liabilities | 0 | 1,268 |
| Other payables | 1,268 | |
| Current liabilities | 0 | 516 |
| Trade payables | 373 | |
| Advances received | 102 | |
| Employee benefits | 9 | |
| Other payables | 32 | |
| Total liabilities | 0 | 1,784 |
| Total net assets acquired | 0 | -387 |
| Net assets acquired | 0 | -387 |
| Goodwill | 1,362 | |
| Consideration paid / to pay in cash and cash equivalents | 0 | 975 |
| Deposits and cash and cash equivalents acquired | 0 | -3 |
| Net cash outflow | 0 | 972 |
As of 31 December 2016, the Group held the following financial instruments measured at fair value:
| in thousands of euros | 31/12/2016 | Level 1 | Level 2 | Level 3 | |
|---|---|---|---|---|---|
| Assets measured at fair value | |||||
| Short-term investments | 46 | 46 |
As of 31 December 2015, the Group held the following financial instruments measured at fair value:
| in thousands of euros | 31/12/2015 | Level 1 | Level 2 | Level 3 | |
|---|---|---|---|---|---|
| Assets measured at fair value | |||||
| Short-term investments | 46 | 46 |
The following hierarchy is used for determining and disclosing the fair value of financial instruments by valuation technique:
During the reporting period, there were no transfers between the different levels.
In 2016 there were no acquisitions that would impact the consolidated financial statements.
In 2015, following acquisitions with effect on the consolidated financial statements took place : on 29 October 2015, Roularta Media Group NV acquired a 65% stake of Storesquare NV and on 19 November 2015, Roularta Media Group NV acquired the remaining 50% of the shares of Himalaya NV. Afterwards, the goodwill of Himalaya NV (brandnames, content, databases, fixed assets) was sold.
The 2015 acquisitions were accounted for using the purchase method in accordance with IFRS 3 Business Combinations (revised).
| ASSETS | ||
|---|---|---|
| Non-current assets | 0 | 98,300 |
| Intangible assets | 90,420 | |
| Property, plant and equipment | 1,337 | |
| Investments accounted for using the equity method | 1,543 | |
| Available-for-sale investments, loans and guarantees | 3,084 | |
| Trade debts and other debts | 1,948 | |
| Deferred tax assets | -32 | |
| Current assets | 0 | 54,508 |
| Inventories | 2,314 | |
| Trade and other receivables | 44,029 | |
| Cash and cash equivalents | 3,018 | |
| Deferred charges and accrued income | 5,147 | |
| Total assets | 0 | 152,808 |
| LIABILITIES | ||
| Non-current liabilities | 0 | 12,379 |
| Provisions | 4,469 | |
| Employee benefits | 7,794 | |
| Other payables | 116 | |
| Current liabilities | 0 | 76,279 |
| Financial liabilities | 510 | |
| Trade payables | 36,608 | |
| Advances received | 17,278 | |
| Employee benefits | 13,205 | |
| Other payables | 8,573 | |
| Accrued charges and deferred income | 105 | |
| Total liabilities | 0 | 88,658 |
| Total disposed net assets | 0 | 64,150 |
| Translation differences in equity | -56 | |
| Minority interests | -351 | |
| Gain (loss) on disposal | -4,618 | |
| Receivables on 31/12/2015 relating to disposal of subsidiaries | -43,325 | |
| Cash consideration received | 0 | 15,800 |
| in thousands of euros | 2016 | 2015 |
|---|---|---|
| ASSETS | ||
| Non-current assets | 0 | 98,300 |
| Intangible assets | 90,420 | |
| Property, plant and equipment | 1,337 | |
| Investments accounted for using the equity method | 1,543 | |
| Available-for-sale investments, loans and guarantees | 3,084 | |
| Trade debts and other debts | 1,948 | |
| Deferred tax assets | -32 | |
| Current assets | 0 | 54,508 |
| Inventories | 2,314 | |
| Trade and other receivables | 44,029 | |
| Cash and cash equivalents | 3,018 | |
| Deferred charges and accrued income | 5,147 | |
| Total assets | 0 | 152,808 |
| LIABILITIES | ||
| Non-current liabilities | 0 | 12,379 |
| Provisions | 4,469 | |
| Employee benefits | 7,794 | |
| Other payables | 116 | |
| Current liabilities | 0 | 76,279 |
| Financial liabilities | 510 | |
| Trade payables | 36,608 | |
| Advances received | 17,278 | |
| Employee benefits | 13,205 | |
| Other payables | 8,573 | |
| Accrued charges and deferred income | 105 | |
| Total liabilities | 0 | 88,658 |
| Total disposed net assets | 0 | 64,150 |
| Translation differences in equity | -56 | |
| Minority interests | -351 | |
| Gain (loss) on disposal | -4,618 | |
| Receivables on 31/12/2015 relating to disposal of subsidiaries | -43,325 | |
| Cash consideration received | 0 | 15,800 |
| Deposits and cash and cash equivalents disposed of | 0 | -3,018 |
| Net cash inflow (outflow) | 0 | 12,782 |
The share of these acquisitions in sales and net result of the Group is:
| 2015 | in thousands of euros | Sales of the period | Net result of the period |
|---|---|---|---|
| - Storesquare NV | 0 | -116 | |
| - Himalaya NV | 227 | -826 |
If the acquisitions of these participations had taken place on 1 January 2015, there would be no major effect on the amount of revenue and result recorded.
In January 2016, Roularta Media Group participated in the capital increase of Proxistore for an amount of € 450K. Roularta Media Group did not participate in a second capital increase in May 2016, making the current participation percentage 46.1%. Proxistore NV is accounted for by using the equity method of consolidation.
On 31 July 2015, Roularta Media Group NV exercised its option to purchase shares in Proxistore held by shareholders IPM and Kadenza for € 650K. This increased the shareholding from 35.87% to 50.0%.
In 2016, there were no disposals of subsidiaries.
In 2015, the French activities were sold. For more detail, see Note 11.
The Group sold also its shareholding (100%) in City Magazine Roularta d.o.o. on 31 December 2015.
The book value of the assets and liabilities of the in 2015 disposed subsidiaries on the date of disposal is presented as follows. Since the French activities were proposed as assets/liabilities held for sale at the end of 2014, the sold balances at the end of May 2015 don't represent a mutation of the continuing balance.
| 2016 | in thousands of euros | Associated companies and joint ventures |
Other related parties |
Total |
|---|---|---|---|---|
| I. Assets with related parties | 3,226 | 19 | 3,245 | |
| Available-for-sale investments, loans and guarantees | 583 | 0 | 583 | |
| Loans | 583 | 583 | ||
| Current receivables | 2,643 | 19 | 2,662 | |
| Trade receivables | 2,222 | 19 | 2,241 | |
| Other receivables | 421 | 421 | ||
| II. Liabilities with related parties | 13,645 | 186 | 13,831 | |
| Financial liabilities | 37 | 0 | 37 | |
| Other payables | 37 | 37 | ||
| Payables | 13,608 | 186 | 13,794 | |
| Financial debts | 583 | 583 | ||
| Trade payables | 2,089 | 186 | 2,275 | |
| Other payables | 10,936 | 10,936 | ||
| III. Transactions with related parties | ||||
| Rendering of services | 9,570 | 660 | 10,230 | |
| Receiving of services (-) | -6,734 | -2,324 | -9,058 | |
| Transfers under finance arrangements | 9 | 9 | ||
| 2016 | in thousands of euros | Associated companies and joint ventures |
Other related parties |
Total |
|---|---|---|---|---|
| I. Assets with related parties | 3,226 | 19 | 3,245 | |
| Available-for-sale investments, loans and guarantees | 583 | 0 | 583 | |
| Loans | 583 | 583 | ||
| Current receivables | 2,643 | 19 | 2,662 | |
| Trade receivables | 2,222 | 19 | 2,241 | |
| Other receivables | 421 | 421 | ||
| II. Liabilities with related parties | 13,645 | 186 | 13,831 | |
| Financial liabilities | 37 | 0 | 37 | |
| Other payables | 37 | 37 | ||
| Payables | 13,608 | 186 | 13,794 | |
| Financial debts | 583 | 583 | ||
| Trade payables | 2,089 | 186 | 2,275 | |
| Other payables | 10,936 | 10,936 | ||
| III. Transactions with related parties | ||||
| Rendering of services | 9,570 | 660 | 10,230 | |
| Receiving of services (-) | -6,734 | -2,324 | -9,058 | |
| Transfers under finance arrangements | 9 | 9 | ||
| IV. Key management personnel remunerations (including directors) | 3,369 | |||
| - of which short-term employee benefits | 3,076 | |||
| - of which post-employment benefits | 228 | |||
| - of which share-based payment expenses | 65 | |||
| V. Remuneration board members for the execution of their mandate | 415 |
In 2016, € 16,000K was received for the sale of the French operations in 2015.
As mentioned above, Roularta Media Group participated in January 2016 in the capital increase of Proxistore for an amount of € 450K. Roularta Media Group did not participate in a second capital increase in May 2016, making the current participation percentage 46.1%. Proxistore NV is accounted for by using the equity method of consolidation. As a result, there was a partial deconsolidation of Proxistore, which resulted in a capital gain of € 398K. Proxistore NV is accounted for by using the equity method of consolidation.
Note 16 shows the condensed financial information related to the interests in associates and joint ventures.
Following significant events occurred after the balance sheet date:
During the month of January 2017, Roularta Media Group successfully relaunched the free publication De Streekkrant as Deze Week, the newspaper with the largest circulation in Belgium.
In January 2017, Roularta Media Group, along with Duval Union, started the Roularta Mediatech Accelerator programme for 9 start-ups.
In February 2017, the judgement on appeal was pronounced in the 'InfoBase' case (see Note 25). A first reading of this judgement appears to be slightly positive and does not require an increase in the provision made that currently amounts to 2.1 million euros.
Otherwise, no major events have occurred which significantly affect the results and the financial position of the company.
The audit fees amount to € 163K. The fees of the auditor related to special services amount to € 45K. The fees payable to persons with whom the auditor is associated amount to € 5K.
The Group has no assets, liabilities nor transactions with its shareholders Comm. VA Koinon, SA West Investment Holding and SA Bestinver Gestión S.G.I.I.C.
Assets, liabilities and transactions with subsidiaries are fully eliminated in consolidation.
Assets, liabilities and transactions with associates and joint ventures are not eliminated in consolidation and are consequently fully included in this heading.
The list with all subsidiaries, joint ventures and associates can be found in Note 38.
All other related parties are entities which are controlled by the key management of the Group or members of their close family, or entities in which these persons have a significant influence. Key management personnel remunerations were separately mentioned.
There are no guarantees related to the assets or liabilities towards the related parties. In 2016, as well as in 2015, no write-downs are registered.
All receivables and payables concern short-term receivables and payables which are settled at expiry date. All transactions concern normal commercial operations. Sales of the Group to these related parties are charged at normal tariffs. Purchases follow the usual procedure concerning selection of the supplier and applied prices.
There are no unsettled receivables nor payables with the key management.
In 2016, the following changes occurred in the consolidated group: New participations
| 2015 | in thousands of euros | Associated companies and joint ventures |
Other related parties |
Total |
|---|---|---|---|---|
| I. Assets with related parties | 3,793 | 15 | 3,808 | |
| Available-for-sale investments, loans and guarantees | 725 | 0 | 725 | |
| Loans | 725 | 725 | ||
| Current receivables | 3,068 | 15 | 3,083 | |
| Trade receivables | 2,174 | 15 | 2,189 | |
| Other receivables | 894 | 894 | ||
| II. Liabilities with related parties | 14,589 | 255 | 14,844 | |
| Financial liabilities | 37 | 0 | 37 | |
| Other payables | 37 | 37 | ||
| Payables | 14,552 | 255 | 14,807 | |
| Financial debts | 835 | 835 | ||
| Trade payables | 2,336 | 255 | 2,591 | |
| Other payables | 11,381 | 11,381 | ||
| III. Transactions with related parties | ||||
| Rendering of services | 9,446 | 666 | 10,112 | |
| Receiving of services (-) | -6,507 | -2,756 | -9,263 | |
| Transfers under finance arrangements | -11 | -11 | ||
| IV. Key management personnel remunerations (including directors) | 3,574 | |||
| - of which short-term employee benefits | 3,239 | |||
| - of which post-employment benefits | 271 | |||
| - of which share-based payment expenses | 64 | |||
| V. Remuneration board members for the execution of their mandate | 425 |
| 2. Consolidated using the equity method | |||
|---|---|---|---|
| BAYARD MEDIA GMBH & CO KG | Augsburg, Germany | 50.00% | joint venture |
| BAYARD MEDIA VERWALTUNGS GMBH | Augsburg, Germany | 50.00% | joint venture |
| BELGOMEDIA SA | Verviers, Belgium | 50.00% | joint venture |
| BITES SA | Vilvoorde, Belgium | 50.00% | joint venture |
| CTR MEDIA SA | Evere, Belgium | 50.00% | joint venture |
| DE WOONKIJKER NV | Roeselare, Belgium | 50.00% | joint venture |
| J.M. SAILER GESCHÄFTSFÜHRUNGS GMBH | Nürnberg, Germany | 50.00% | joint venture |
| J.M. SAILER VERLAG GMBH | Nürnberg, Germany | 50.00% | joint venture |
| JOEfm NV | Vilvoorde, Belgium | 50.00% | joint venture |
| MEDIALAAN NV | Vilvoorde, Belgium | 50.00% | joint venture |
| PRESS PARTNERS BV | Baarn, The Netherlands | 50.00% | joint venture |
| REGIONALE MEDIA MAATSCHAPPIJ NV | Roeselare, Belgium | 50.00% | joint venture |
| REGIONALE TV MEDIA NV | Zellik, Belgium | 50.00% | joint venture |
| SENIOR PUBLICATIONS DEUTSCHLAND GMBH & CO KG | Cologne, Germany | 50.00% | joint venture |
| SENIOR PUBLICATIONS NEDERLAND BV | Baarn, The Netherlands | 50.00% | joint venture |
| SENIOR PUBLICATIONS SA | Brussels, Belgium | 50.00% | joint venture |
| SENIOR PUBLICATIONS VERWALTUNGS GMBH | Cologne, Germany | 50.00% | joint venture |
| STIEVIE NV | Vilvoorde, Belgium | 50.00% | joint venture |
| TVBASTARDS NV | Boortmeerbeek, Belgium | 50.00% | joint venture |
| UNLEASHED NV | Hasselt, Belgium | 50.00% | joint venture |
| VERLAG DEUTSCHER TIERSCHUTZ-DIENST GMBH | Nürnberg, Germany | 50.00% | joint venture |
| VIKINGCO BV | Maastricht, The Netherlands | 50.00% | joint venture |
| PROXISTORE NV | Mont-Saint-Guibert, Belgium | 46.12% | associate |
| CLICK YOUR CAR NV | Le Roeulx, Belgium | 35.74% | associate |
| YELLOWBRICK NV | Schaarbeek, Belgium | 35.00% | associate |
| REPROPRESS CVBA | Brussels, Belgium | 29.93% | associate |
| 50+ BEURS & FESTIVAL BV | Arnhem, The Netherlands | 25.00% | joint venture |
| LIVING & MORE VERLAG GMBH - in liquidation | Augsburg, Germany | 25.00% | joint venture |
| TWICE ENTERTAINMENT BVBA | Roeselare, Belgium | 25.00% | associate |
| FEBELMA REGIE CVBA | Brussels, Belgium | 23.35% | associate |
| 4 ALL SOLUTIONS BVBA | Oostrozebeke, Belgium | 15.00% | associate |
| MEDIAPLUS BV | Bussum, The Netherlands | 12.50% | associate |
| EUROCASINO NV - in liquidation | Brussels, Belgium | 19.00% | |
|---|---|---|---|
| TWICE TECHNICS BVBA | Roeselare, Belgium | 18.75% | |
| MEDIA ID CVBA | Brussels, Belgium | 27.27% | |
The ultimate parent of the Group is Roularta Media Group NV, Roeselare, Belgium. As of 31 December 2016, 44 subsidiaries, joint ventures and associates are consolidated.
| Name of the company | Location | Effective interest % |
|
|---|---|---|---|
| 1. Fully consolidated companies | |||
| ROULARTA MEDIA GROUP NV | Roeselare, Belgium | 100.00% | |
| ROULARTA HEALTHCARE NV | Roeselare, Belgium | 100.00% | |
| BELGIAN BUSINESS TELEVISION NV | Brussels, Belgium | 100.00% | |
| HIMALAYA NV | Roeselare, Belgium | 100.00% | |
| ROULARTA SERVICES FRANCE SARL | Lille, France | 100.00% | |
| TER BEVORDERING VAN HET ONDERNEMERSCHAP IN BELGIË VZW |
Roeselare, Belgium | 100.00% | |
| TVOJ MAGAZIN D.O.O. - in liquidation | Zagreb, Croatia | 100.00% | |
| VOGUE TRADING VIDEO NV | Roeselare, Belgium | 74.67% | |
| STORESQUARE NV | Roeselare, Belgium | 70.70% | |
| JOURNÉE DÉCOUVERTE ENTREPRISES ASBL | Dison, Belgium | 56.25% | |
| STUDIO APERI NEGOTIUM BVBA | Gentbrugge, Belgium | 56.25% | |
| OPEN BEDRIJVEN VZW | Gentbrugge, Belgium | 56.25% | |
| ZEEUWS VLAAMS MEDIABEDRIJF BV | Terneuzen, The Netherlands | 51.00% |
As required by law, we report to you in the context of our appointment as the company's statutory auditor. This report includes our report on the consolidated financial statements together with our report on other legal and regulatory requirements. These consolidated financial statements comprise the consolidated balance sheet as at 31 December 2016, the consolidated income statement, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated cash flow statement for the year then ended, as well as the summary of significant accounting policies and other explanatory notes.
We have audited the consolidated financial statements of Roularta Media Group NV ('the company') and its subsidiaries (jointly 'the Group'), prepared in accordance with International Financial Reporting Standards as adopted by the European Union and with the legal and regulatory requirements applicable in Belgium. The consolidated balance sheet shows total assets of 443,201 (000) EUR and the consolidated income statement shows a consolidated profit (Group share) for the year then ended of 21,473 (000) EUR.
The board of directors is responsible for the preparation and fair presentation of consolidated financial
Statutory auditor's report to the shareholders' meeting of Roularta Media Group NV on the consolidated financial statements for the year ended 31 December 2016 The original text of this report is in Dutch.
but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the board of directors, as well as evaluating the overall presentation of the consolidated financial statements. We have obtained from the Group's officials and the board of directors the explanations and information necessary for performing our audit.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
In our opinion, the consolidated financial statements of Roularta Media Group NV give a true and fair view of the Group's net equity and financial position as of 31 December 2016, and of its results and its cash flows for the year then ended, in accordance with International Financial Reporting Standards as adopted by the European Union and with the legal and regulatory requirements applicable in Belgium.
The board of directors is responsible for the preparation and the content of the directors' report on the consolidated financial statements.
As part of our mandate and in accordance with the Belgian standard complementary to the International Standards on Auditing applicable in Belgium, our responsibility is to verify, in all material respects, compliance with certain legal and regulatory requirements. On this basis, we make the following additional statement, which does not modify the scope of our opinion on the consolidated financial statements:
• The directors' report on the consolidated financial statements includes the information required by law, is consistent with the consolidated financial statements and is free from material inconsistencies with the information that we became aware of during the performance of our mandate.
Gent, 11 April 2017 The statutory auditor DELOITTE Bedrijfsrevisoren / Réviseurs d'Entreprises BV o.v.v.e. CVBA / SC s.f.d. SCRL
Represented by Kurt Dehoorne Mario Dekeyser
statements in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and with the legal and regulatory requirements applicable in Belgium, and for such internal control as the board of directors determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing (ISA) as adopted in Belgium. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the statutory auditor's judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the statutory auditor considers internal control relevant to the Group's preparation and fair presentation of consolidated financial statements in order to design audit procedures that are appropriate in the circumstances,
The following pages are extracts of the statutory annual accounts of Roularta Media Group NV, prepared under Belgian accounting policies.
The valuation rules applied in the statutory annual accounts differ substantially from the valuation rules applied in the consolidated annual accounts: the statutory annual accounts are based on Belgian accounting legislation, while the consolidated annual accounts are drawn up in accordance with the International Financial Reporting Standards.
Only the consolidated annual accounts as set forth in the preceding pages present a true view of the financial position and performance of the Roularta group.
The report of the board of directors to the general meeting of shareholders and the annual accounts of Roularta Media Group NV, as well as the auditor's report, will be filed with the National Bank of Belgium within the statutory stipulated periods. These documents are available on request from Roularta Media Group's Investor Relations Department and at www.roularta.be/en.
The auditor has issued an unqualified opinion for the annual accounts of Roularta Media Group NV.
The annual accounts, which will be presented to the general meeting of shareholders of 16 May 2017, were approved by the board of directors of 10 April 2017.
The profit for the financial year 2016 available for appropriation is 15,479,300.54 euros compared to a profit of 52,538,331.65 euros for the financial year 2015.
Taking into account the profit carried forward of 3,256,000.68 euros, the profit to be appropriated for the financial year 2016 amounts to 18,735,301.22 euros.
The board of directors proposes to the general meeting to distribute a gross dividend of 0.50 euros per share. This means a net dividend of 0.35 euros per share (after 30% of withholding tax).
Pursuant to Article 622 § 1, final section of the Companies Code, it is proposed not to suspend the dividend right attached to own shares in the company's portfolio and to pay the distributable profit in full to the remaining shares. The corresponding dividend coupons on own shares in the portfolio will be destroyed.
On the date of the annual report, the company had 607,925 own shares in its portfolio. In the context of the appropriation of results shown below, it was assumed that 12,533,198(1) shares are entitled to a dividend. If between the date this annual report was prepared and the general meeting to be held on 16 May 2017 there are additional personnel who exercise their Roularta share options, this will have an impact on the number of shares entitled to a dividend and the amount of the compensation to capital can still change.
Appropriation of profit We propose to give the result the following appro-
priation:
| A. Profit to be appropriated | 18,735,301.22 |
|---|---|
| • profit of the year | 15,479,300.54 |
| • retained profit of previous year | 3,256,000.68 |
| B. Profit to be carried forward | 12,468,702.22 |
| C. Profit to be distributed | |
| • return on capital | 6,266,599.00(2) |
If the general meeting accepts this proposal for appropriation of the profit, dividends will become payable from 1 June 2017 (= pay date) onwards. ING will be appointed as paying agent.
(1) Total of shares issued 13,141,123 minus 607,925 own shares. (2) Calculated on the basis of 12,533,198 shares entitled to a dividend.
| Condensed statutory income statement in thousands of euros |
2016 | 2015 |
|---|---|---|
| Operating income | 282,581 | 293,386 |
| Operating charges | -273,421 | -284,403 |
| Operating profit / loss | 9,160 | 8,983 |
| Financial income | 13,820 | 356,267 |
| Financial charges | -7,704 | -312,687 |
| Profit (loss) for the period before taxes | 15,276 | 52,563 |
| Transfer from deferred taxation | 83 | 16 |
| Income taxes | -42 | -65 |
| Profit (loss) for the period | 15,317 | 52,514 |
| Transfer from untaxed reserves | 162 | 24 |
| Profit (loss) for the period available for appropriation | 15,479 | 52,538 |
| Appropriation account | in thousands of euros | 2016 | 2015 |
|---|---|---|---|
| Profit (loss) to be appropriated | 18,735 | -115,965 | |
| Profit (loss) for the period available for appropriation | 15,479 | 52,538 | |
| Profit (loss) brought forward | 3,256 | -168,503 | |
| Transfers from capital and reserves | 0 | 130,595 | |
| From capital and from share premium account | 123,225 | ||
| From reserves | 7,370 | ||
| Transfers to capital and reserves | 0 | -5,121 | |
| To legal reserve | 0 | ||
| To other reserves | 5,121 | ||
| Result to be carried forward | -12,469 | -3,256 | |
| Profit (loss) to be carried forward | 12,469 | 3,256 | |
| Distribution of profit | -6,266 | -6,253 | |
| Dividends | 6,266 | 6,253 |
| ASSETS | in thousands of euros | 2016 | 2015 |
|---|---|---|---|
| Fixed assets | 174,511 | 175,416 | |
| Formation expenses | 0 | 0 | |
| Intangible assets | 35,164 | 39,717 | |
| Tangible assets | 32,295 | 31,689 | |
| Financial assets | 107,052 | 104,010 | |
| Current assets | 162,181 | 174,319 | |
| Amounts receivable after more than one year | 15,634 | 32,776 | |
| Stocks and contracts in progress | 6,228 | 5,420 | |
| Amounts receivable within one year | 73,795 | 81,071 | |
| Investments | 16,966 | 27,253 | |
| Cash at bank and in hand | 44,938 | 23,410 | |
| Deferred charges and accrued income | 4,620 | 4,389 | |
| Total assets | 336,692 | 349,735 | |
| LIABILITIES | in thousands of euros | 2016 | 2015 |
| Capital and reserves | 114,186 | 105,136 | |
| Capital | 80,000 | 80,000 | |
| Share premium account | 304 | 304 | |
| Legal reserve | 8,000 | 8,000 | |
| Reserves not available for distribution | 11,920 | 12,207 | |
| Untaxed reserves | 1,207 | 1,369 | |
| Reserves available for distribution | 286 | 0 | |
| Profit (loss) carried forward | 12,469 | 3,256 | |
| Investment grants | 0 | 0 | |
| Provisions and deferred taxation | 7,426 | 8,760 | |
| Creditors | 215,080 | 235,839 | |
| Amounts payable after more than one year | 105,828 | 111,172 | |
| Amounts payable within one year | 101,691 | 119,843 | |
| Accrued charges and deferred income | 7,561 | 4,824 | |
| Total liabilities | 336,692 | 349,735 |
Krant van West-Vlaanderen: 368,227 CIM readers, distribution 65,045 copies
Knack: 504,198 CIM readers, distribution 98,671 copies Le Vif/L'Express: 375,097 CIM readers, distribution 60,689 copies Knack Weekend: 378,862 CIM readers, distribution 98,671 copies Le Vif Weekend: 203,568 CIM readers, distribution 60,689 copies Knack Focus: 278,187 CIM readers, distribution 98,671 copies Focus Vif: 124,895 CIM readers,
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BMC
BRUSSELS MEDIA CENTRE
| General Meeting 2016 | 16 May 2017 |
|---|---|
| Half year 2017 results | 21 August 2017 |
| Full year 2017 results | 12 March 2018 |
| General Meeting 2017 | 15 May 2018 |
| Rik De Nolf | |
|---|---|
| Phone | +32 51 26 63 23 |
| Fax | +32 51 26 65 93 |
| [email protected] | |
| Website | www.roularta.be |
NV Roularta Media Group, Meiboomlaan 33, 8800 Roeselare, VAT BE 0434.278.896, RPR Ghent, department Kortrijk Responsible publisher: Rik De Nolf, Meiboomlaan 33, 8800 Roeselare
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