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Ilkka Oyj Annual Report 2014
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Annual Report
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ILKKA-YHTYMÄ
Annual Report
2014
الخارجية. وقدْ كان من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من الممكن أن يكون من
Annual Report 2014 | 3
Contents
OVERVIEW
4
- Greetings from the Managing Director 4
- Message from the Chairman of the Board of Directors 5
- Ilkka-Yhtymä's History 6
- Group in Brief 7
- Values and Strategy 10
- Information to Shareholders 11
OPERATIONS
12
- Operating Environment 12
- Publishing 13
- I-Mediat Oy 14
- Printing 16
- I-print Oy 16
- Personnel 17
CORPORATE RESPONSIBILITY
18
- Financial added value for stakeholders 28
FINANCIAL STATEMENTS AND THE REPORT OF THE BOARD OF DIRECTORS FOR 2014
29
- Report by the Board of Directors 30
- Consolidated Financial Statements, IFRS
- Consolidated Income Statement 36
- Consolidated Balance Sheet 37
- Consolidated Cash Flow Statement 38
- Changes in Consolidated Shareholders' Equity 39
- Notes to the Consolidated Financial Statements 40
- Group Key Figures 62
- Calculation Principles of the Key Figures 63
- Parent Company Financial Statements, FAS
- Parent Company Income Statement 64
- Parent Company Balance Sheet 64
- Parent Company Cash Flow Statement 65
- Notes to the Parent Company Financial Statements 66
- Shares and Shareholders 73
- Proposal by the Board of Directors on Profit Distribution 79
- Auditors' Report 80
- Supervisory Board's Statement 81
ADMINISTRATION
82
- Corporate Governance 82
- Supervisory Board 87
- Board of Directors of the Group 88
- Group Executive Team 90
- Group Structure 92
- Contact Information 93
DESIGN/LAYOUT: Mirja Pajula, I-print | plus
PHOTOS: Matti Hautalahti, I-print | plus
PRINTED BY: I-print Oy
GREETINGS FROM THE MANAGING DIRECTOR
Reforming for the future
In 2014, the Finnish national economy kept shrinking for a third year in a row due to low domestic demand and investment activity, and weak international economic development. Both media advertising and income from content diminished in Finland as a result of consumer caution and digitalisation. With our net sales falling behind the targets already during the first quarter of the year, to secure profitability we were forced to adjust our operations towards the end of the year by, for example, laying off personnel.
In spite of strict cost-saving measures, we kept implementing planned strategic projects to ensure the Group's success in the coming years.
IN JOURNALISTIC TERMS, the most important project was the establishment and launch of the operations of Lännen Media Oy, jointly owned by provincial newspapers of Western Finland. Lännen Media produces non-local content for the needs of 12 provincial newspapers. Jointly produced content helps us differentiate ourselves from the offering of other media and strengthens our own operations. The shared editorial staff also releases resources for the production of paper's local content to strengthen the local Ostrobothnian approach and community spirit of the paper.
In accordance with our content strategy, we will review the quality and quantity of the advertiser-funded content and paid journalistic content being published during the ongoing year. At the turn of the year, we revamped and harmonised the look of our local newspapers. In our provincial newspapers, on the other hand, we are not planning a format change, a transfer to the tabloid format, in the ongoing year.
Owing to the new strategy of our delivery services provider Posti, the management of the service and expense level of physical delivery in terms of delivery times is becoming more and more important in the years to come. That is why we will revise the forms of subscription during this year. In the future, the revised newspaper subscription will also include a digital edition of the newspaper, which makes it possible for our readers to access the paper regardless of the time and place. As HSS Media launched its own newspaper delivery operations in spring 2014, we became customers of this new delivery company in the Swedish-speaking Ostrobothnia, except in Vaasa.
The new digital products and services produced by us or our associated companies also require a
fresh approach to business-to-business marketing and sales. During this year, we will enter the next phase in the development of our customer-oriented operating model that we renewed in 2013. The operating model under development and the adoption of new systems supporting it will enable provision of an expanding, multi-channel and higher-quality service range for boosting the marketing and sales of our customers.
ALL REFORMS also require that the staff remains committed to them. The group has created excellent conditions for this by having continued development of its operations for many years.
Annual Report 2014
MESSAGE FROM THE CHAIRMAN OF THE BOARD OF DIRECTORS
The price of newsprint has fallen in recent years as the consumption volume is reducing. In spite of reductions in production capacity, overproduction still continues in Europe, which will probably keep the price level down in the coming years. Even though the development of personnel, capital and other expenses has been moderate, the weak development of net sales creates pressures to increase productivity in all operations. However, the profit performance during the last quarter gives us confidence in our ability to make profit.
I would like to express my thanks to all employees for their fine performance, and to our customers, shareholders and their representatives for their fruitful cooperation.
Matti Korkiatupa
Managing Director
> Ilkka-Yhtymä will begin 2015 on a firmer footing, ready to invest in the development of operations.
Deposit and Stock
THE LAST FEW YEARS have been turbulent in the media sector. However, I can assure you that our ship is ready to sail on at full speed once the economic climate improves again.
We are going to see in due course how much of the decrease in net sales has been due to the recession and how much has been due to the digital transformation. I believe that the impact of the latter has been greatly exaggerated.
Little attention has been paid to the fact that companies which have succeeded in the retail trade, sports trade and even online trade have done so largely thanks to print advertising. Meanwhile, many companies that in the midst of the digital frenzy have substantially reduced traditional advertising have fallen behind their competitors.
Print newspapers have also maintained their importance as a news medium. Admittedly, circulations have fallen, but as a result of urbanisation, newspapers are increasingly read outside the home as well. Numbers of readers have remained rather high particularly in target groups with a good financial standing, meaning that papers will continue to be an effective means of advertising.
ILKKA-YHTYMÄ has already made significant investments in digital channels. Aggregate net sales from Ilkka-Yhtymä's web operations and Ilkka-Yhtymä's share of the associate companies' web operations exceeded EUR 30 million in 2014.
A new phase is about to begin in 2015 in Ilkka's and Pohjalainen's digital development, with the increase in the use of the mobile internet.
Due to the economic structure of the regions, the large-scale digitalisation of newspaper services has only been possible as mobile solutions have become more common.
From the perspective of shareholders, earnings per share have in recent years been regrettably low. Among the reasons for this downbeat mood has been the uncertainty about the company's financial position after the major investment in Alma Media. Alma Media's digital success in 2014 turned the long-term downward trend in its share price up again, proving that the chosen strategy works.
The sale of Anvia shares in late summer 2014 also significantly improved our financial position.
Consequently, Ilkka-Yhtymä will begin 2015 on a firmer footing, ready to invest in the development of operations.
Timo Aukia
Chairman of the Board of Directors
Annual Report 2014 | 5
ILKKA-YHTYMÄ GROUP
108 years
1906
Ilkka established.
1981
Ilkka's shares (current Series I shares) listed on the Broker's List of the Helsinki Stock Exchange.
1992
Acquisition of Vaasa Oy: Papers Pohjalainen (established in 1903) and Etelä-Pohjanmaa.
1995
Dismantling of Pro Lehdistö; Ilkka obtains 16.8% of Savon Mediat Oy. Local newspapers merged into Ilkka Oy.
2000
Transfer of assets from Ilkka-Yhtymä Oyj:
- Sanomalehti Ilkka Oy (Ilkka)
- Pohjanmaan Lähisanomat Oy (Etelä-Pohjanmaa, Viiskunta, Suupohjan Sanomat, Jurvan Sanomat, Härmät and Järviseutu)
Holding of 25.9% in Arena Partners Oy.
2001
Divestment of 5.6% from Savon Mediat Oy (11.2%).
2006
Divestment of holding in Savon Mediat Oy.
2009
A 10.1 % holding acquired from Alma Media Corporation (20.4 %).
Merger 31 December 2009.
- Sanomalehti Ilkka Oy and Pohjanmaan Lähisanomat Oy merged with Vaasa Oy, renamed I-Mediat Oy on 1 January 2010
Holding in Arena Partners Oy changed (37.82%).
2012
I-Mediat Oy and Alma Media Kustannus Oy sign an agreement for editorial collaboration.
1962
Ilkka Oy moves from Vaasa to Seinäjoki.
1988
The new Series II shares listed on the Broker's List.
1999
Change of name from Ilkka Oyj to Ilkka-Yhtymä Oyj.
Acquisition of HSS Media Ab's printing press in Vaasa.
2002
Ilkka-Yhtymä Oyj's Series II shares transferred to the Main List of the Helsinki Stock Exchange.
2004
Acquisition of 14.4 % in Savon Mediat Oy (25.6%).
2010
A 9.66% holding acquired from Alma Media Corporation (29.79%).
2014
Ilkka-Yhtymä withdraws from Väli-Suomen Media.
Part of the deliveries of Ilkka-Yhtymä's newspapers transferred to HSS Media.
Lännen Media Oy established.
1980-1990's
Acquisition of local newspapers: Viiskunta, Härmät, Suupohjan Sanomat, Jurvan Sanomat and Järviseutu.
1997
Introduction of I-print Oy's new print factory.
Holding of 40% in Väli-Suomen Media Oy.
2008
Acquisition of the newspaper Kauhava.
A 7% holding acquired from Alma Media Corporation (10.3%).
Annual Report 2014
ILKKA-YHTYMÄ GROUP
The parent company is responsible for the Group's management, strategic planning and development of strategies together with its subsidiaries.
Ilkka-Yhtymä Group in Briet
ILKKA-YHTYMÄ GROUP is a media group comprising the parent company Ilkka-Yhtymä Oyj, the publishing company I-Mediat Oy and the printing house I-print Oy. The Group also includes two property companies and Alma Media Corporation, Arena Partners Oy and Yrittävä Suupohja Oy as associated companies.
The Series I shares of Ilkka-Yhtymä Oyj have been listed on the Helsinki Stock Exchange since 1981. The Series II shares have been listed since their issue in 1988 and, on 10 June 2002, they were listed on the Main List of the Helsinki Stock Exchange. At present, the Series II shares of Ilkka-Yhtymä Oyj are listed on the Nasdaq Helsinki List, Consumer Services sector, the company's market value being classified as Small Cap. The Series I shares are listed on the Pre List.
The parent company is responsible for the Group's management, strategic planning and development of strategies together with its subsidiaries. Ilkka-Yhtymä Oyj offers its subsidiaries services ranging from financial and investment services to human relations, development and information management and property maintenance services.
ILKKA-YHTYMÄ
Ilkka-Yhtymä Oyj
PUBLISHING
I-Mediat Oy
PRINTING
I-print Oy
PROPERTY COMPANIES
Kiinteistö Oy
Seinäjoen Koulukatu 10
Seinäjoen Kassatalo
Osakeyhtiö
ASSOCIATED COMPANIES
Alma Media Oyj
Arena Partners Oy
Yrittävä Suupohja Oy
Annual Report 2014
ILKKA-YHTYMÄ GROUP
41.8
NET SALES, M€
Ilkka-Yhtymä Group in Brief
Annual Report 2014
Annual Report 2014 | 9
■ Reported ■ Excluding the EUR 22 million write-down ■ Excluding the EUR 27 million write-down
Profit before taxes grew
excluding the write-down
1.1%
Earnings per share grew
excluding the write-down
2.8%
| ILKKA-YHTYMÄ GROUP (IFRS) | 2014 | 2013 | Change-% |
|---|---|---|---|
| Net sales, MEUR | 41.8 | 44.9 | -6.9 |
| Operating profit excluding the write-down, MEUR | 9.3 | 10.4 | -10.8 |
| Reported operating profit/ loss, MEUR | 9.3 | -16.6 | 155.6 |
| Profit before tax excluding the write-down, MEUR | 10.1 | 10.0 | 1.1 |
| Reported profit/ loss before tax, MEUR | 10.1 | -17.0 | 159.7 |
| Return on investment (ROI), % | 9.7 | -11.6 | |
| Earnings per share (EPS) excluding the write-down, EUR | 0.35 | 0.34 | 2.8 |
| Reported earnings per share (EPS), EUR | 0.35 | -0.71 | 149.9 |
| Dividend per share, EUR | 0.10 *) | 0.10 | |
| Equity ratio, % | 50.2 | 44.2 | |
| Gross capital expenditure, MEUR | 0.5 | 1.4 | -67.4 |
| Personnel | 311 | 321 | -3.1 |
*) Board of Directors' proposal
ILKKA-YHTYMÄ GROUP
Our Mission
Ilkka-Yhtymä is a customer-oriented and reliable Ostrobothnian media Group which produces financial and cultural added value for its interest groups. The Group is networked, and participates actively in the development of its industry.
Vision
Ilkka-Yhtymä is in demand, successful and is a media group that operates in the spirit of the times.
Values
We respect
We are innovative
We succeed
We care
Strategy
THE CORNERSTONES OF ILKKA-YHTYMÄ'S STRATEGY IN 2013-2015
- Ilkka-Yhtymä is a customer-driven and cost-effective communications company with networked operations.
- We will focus on our core businesses, publishing and printing cross-media newspapers, and investigate opportunities for expansion into other areas of the media industry.
- We will seek to grow both organically and through our associate companies.
- We will keep our newspaper brands apart while providing common content and services, taking the needs of customers and network partners into account.
- We will invest in product development, and in the well-being and strategically important areas of expertise of our staff.
- Our functions steer and develop our business processes in pursuit of improving our profitability and competitiveness.
- We allocate our long-term investments to strategic targets.
GROWTH AND PROFITABILITY
The growth target for operating net sales will correspond to at least the level of growth occurring in domestic consumers' purchasing power. Other objectives: ROI (return on investment) 10%, ROE (return on equity) 15% and equity ratio minimum 40%.
OWNERSHIP AND DIVIDEND POLICY
Ilkka-Yhtymä Oyj practises an active dividend policy and aims to distribute at least half of its consolidated annual income as dividend payments. However, dividend distribution is affected not only by the earnings trend, but also by the Group's financial standing, the financing required for profitable growth and the company's future outlook and development needs.
Annual Report 2014
ILKKA-YHTYMÄ GROUP
Information to Shareholders
ANNUAL GENERAL MEETING
The Annual General Meeting of Ilkka-Yhtymä Oyj will be held on Wednesday, 22 April 2015 at 3 p.m. at the Auditorium of Frami Oy (Frami B). The address is Kampusranta 9 B, FIN-60320 Seinäjoki.
DIVIDEND DISTRIBUTION
The Board of Directors proposes to the AGM that a per-share dividend of EUR 0.10 be paid for 2014. If this proposal is approved, the record date of dividend payment will be 24 April 2015, and the dividend will be paid on 4 May 2015. Shareholders whose shares have not been entered in the book-entry system by the record date will be paid the dividend once their shares have been entered.
SHARE REGISTER
Ilkka-Yhtymä Oyj's share information is maintained by Euroclear Finland Oy, telephone +358 20 770 6000, fax +358 20 770 6658. Issues relating to shareholder information are handled by Ilkka-Yhtymä Oyj's Financial Service Department, located at Koulukatu 10, FIN-60100 Seinäjoki, telephone +358 6 247 7127.
FINANCIAL INFORMATION
In 2015, Ilkka-Yhtymä Oyj will publish interim reports as follows: for the period January-March on 4 May 2015, for the period January-June on 3 August 2015, and for the period January-September on 2 November 2015. These will be available both in Finnish and English on our website at www.ilkka-yhtyma.fi and can also be ordered at www.ilkka-yhtyma.fi under Sijoittajat - Materiaalit - Materiaalitilaus (Finnish web address only). Stock exchange releases and statements published by Ilkka-Yhtymä Oyj in 2014 are available on the company's website at www.ilkka-yhtyma.fi.
IFRS FINANCIAL STATEMENTS
The consolidated financial statements presented in Ilkka-Yhtymä Oyj's annual report have been prepared in accordance with the International Financial Reporting Standards, IFRS. Before the adoption of IFRS, the Group's financial reporting was based on the Finnish Accounting Standards, FAS. The Group adopted IFRS on 1 January 2004. The financial statements of the parent company have been prepared in accordance with the Finnish Accounting Standards. All the figures in the annual report are rounded, so the sum of separate figures may differ from that presented in the report.
2015
ILKKA-YHTYMÄ OYJ'S AGM
22 April 2015
at 3 p.m.
INTERIM REPORT
JANUARY-MARCH
4 May 2015
CLOSED WINDOW 6 APRIL - 4 MAY 2015
INTERIM REPORT
JANUARY-JUNE
3 August 2015
CLOSED WINDOW 6 JULY - 3 AUGUST 2015
INTERIM REPORT
JANUARY-SEPTEMBER
2 November 2015
CLOSED WINDOW 5 OCTOBER - 2 NOVEMBER 2015
ILKKA-YHTYMÄ OYJ'S WEBSITE
WWW.ILKKA-YHTYMA.FI
Annual Report 2014 | 11
BUSINESS ENVIRONMENT
Business environment
GENERAL ECONOMIC TRENDS
ACCORDING TO THE BANK OF FINLAND forecast of 11 December 2014, the Finnish GDP was expected to shrink by approximately 0.2% in 2014. Even though the production rate is already slowly starting to pick up in 2015, it is expected to remain 0.1% smaller than the year before. According to Statistics Finland, the inflation rate was 0.5% in December, while the average inflation rate for 2014 stood at 1.0%.
Private consumption is not expected to have increased at all in 2014. The projected growth for private consumption in 2015 is in the region of 0.3 per cent. According to the consumer survey of Statistics Finland, the economic confidence continued to rise slightly in January 2015.
According to Statistics Finland, the unemployment rate for 2014 was 8.7%, while the figure for 2013 was 8.2%. The preliminary estimate is that the average increase in wage earners' income levels was 1.4% from the previous year, while real earnings rose by 0.4%.
DEVELOPMENT OF THE OPERATING REGION
SOUTH OSTROBOTHNIA nurtures growth-oriented, cross-sectoral business operations. The strongest clusters are the food industry, the metal and technology industry and the wood products industry. In the creative sector, a wealth of expertise has been built around popular music and various cultural events.
For the second time in a row, the Seinäjoki sub-region was placed number one in a ranking by the Confederation of Finnish Industries that compares the appeal of Finland's sub-regions to companies. Seinäjoki's growth rate has been rapid in recent years. The challenge is whether companies have the courage to invest in the uncertain economic climate.
South Ostrobothnia is a food region, where innovations related to food systems and the bioeconomy have major potential. In the food industry, the outlook is fairly positive, but there are challenges, such as the increasingly intense international competition and responding to consumer habits and trends that are changing more quickly than ever. The situation in Russia and the sanctions policy also pose new challenges to the food sector.
Today, South Ostrobothnia's economic and employment outlook can be characterised as flat. However, among highly growth-oriented companies, the situation is more positive.
OSTROBOTHNIA is Finland's most industrialised region. A quarter of those with jobs work in industry, while country-wide only 15% do so. Almost half of production is generated by industry, compared to one fifth country-wide. Exports account for around 70% of Ostrobothnia's industrial production. More than half of exports go outside the EU, which is why the strength of the euro against the dollar has in recent years hampered their growth. The weakening of the euro against the dollar and the lower price of oil have improved export prospects.
Demand related to energy savings and increased efficiency is growing globally at an accelerating pace, so the outlook for the region's energy cluster is excellent, although the current recession has slowed growth. The cluster's success is also reflected in the rest of the regional economy.
Aggregate net sales in Ostrobothnia declined by 4% from the third quarter of 2013 to the third quarter of 2014. Net sales fell particularly in industry and also in the retail sector. Meanwhile, net sales in the construction sector were up. According to a recent survey of small and medium-sized enterprises, the outlook for SMEs in the Vaasa sub-region for the coming year is brighter than country-wide. In the Confederation of Finnish Industries' municipality ranking, the Vaasa sub-region was placed third.
Annual Report 2014
PUBLISHING
Development of the media sector in Finland
ACCORDING TO A SURVEY CONDUCTED by TNS Gallup Oy and commissioned by the Finnish Advertising Council, media advertising decreased by 2.6% in 2014. Advertising in newspapers fell by 8.7%, while advertising in free sheets decreased by 1.7%. Newspapers and free sheets accounted for 32.5% and 5.5% of media advertising, respectively. Web media advertising saw an increase of 10.8%, representing a 22.5% share of media advertising.
Money spent in 2014 on media advertising in Finland totalled EUR 1,176 million. Money spent on advertising in printed newspapers came to EUR 382.7 million. Print media accounted for 46.1% of media advertising, i.e. EUR 542 million.
PRINT CONTINUES TO BE by far the most popular format for reading newspaper content. According to the National Readership Survey (NRS), as many as 89% of Finns read a print newspaper every week. A total of 70% of Finns read newspapers on a computer, mobile phone or tablet every week. A significant increase has been seen in the use of mobile devices for reading newspapers: as many as 35% of Finns read newspapers on a mobile phone every week and 21% on a tablet or reading device. These figures have nearly doubled in a year.
In 2013, the total circulation for newspapers was 2,382,495 copies, decreasing by 5.5% year-on-year. Of newspapers' total circulation, 7-day newspapers represent slightly over half. The circulation of newspapers issued 7 times a week fell by 5.6%. For local and other newspapers issued 1 to 3 times a week, circulation declined by 2.9% (Suomen Lehdistö 5/2014).
MEDIA ADVERTISING BREAKDOWN 2014
- Newspapers 32.5%
- Television 22.5%
- Online media 22.5%
- Magazines 8.1%
- Free sheets, delivered and take away 5.5%
- Radio 4.9%
- Outdoor advertising 3.8%
- Movies 0.3%
100%
Annual Report 2014
PUBLISHING
> Ilkka is subscribed to because of regional news. There is no better source for them than Ilkka."
Satu Takala
Chief Editor, Ilkka, I-Mediat Oy
> We are proud to be Ostrobothnian. It means being bold and talking straight. The paper cherishes its community."
Toni Viljanmaa
Chief Editor, Pohjalainen, I-Mediat Oy
> We revamped and harmonised the look and structure of all local newspapers."
Sauli Harjamäki
Director, Local newspapers I-Mediat Oy
> Digital advertising became an even more important part of the total offering to our customers."
Marko Orpana
Director, Web and Mobile Business, I-Mediat Oy
> The overall reach of the provincial newspapers has remained excellent."
Päivi Sairo
Director, Consumer Marketing, I-Mediat Oy
> We have introduced new product packages combining print and digital to boost the effect of advertising."
Hannu Uusihauta
Director, Corporate Marketing, I-Mediat Oy
New kinds of collaborative
arrangements, extending beyond the traditional boundaries, were agreed on in 2014. The most significant of these was the establishment of Lännen Media, which clarified the creation of national and regional news content.
FOR PROVINCIAL NEWSPAPERS, the most important project in journalistic terms was the establishment and launch of the operations of Lännen Media Oy, jointly owned by provincial newspapers of Western Finland. The company, which creates content for 12 newspapers in all, began operations in October 2014. Lännen Media provides national news, thematic content, supplements and world news for Ilkka and Pohjalainen, along with news items for the web.
Lännen Media clarifies the distribution of responsibilities between editorial departments in the creation of national and regional news. Lännen Media's jointly produced non-local content helps us to differentiate ourselves from the offering of other media and strengthens our operations. Ilkka's and Pohjalainen's reporters cover regional news, which is important to the readers.
The editorial departments of the provincial newspapers have fulfilled their key responsibility as advocates of their respective regions. The papers have retained the high quality of their content despite the changes in the operating environment.
At the beginning of 2015, Toni Viljanmaa (Master of Arts) took up the post of Chief Editor of Pohjalainen.
FOR LOCAL NEWSPAPERS, the year was marked by preparations for change. The look and structure of all local newspapers were revamped and harmonised. The paper and digital subscriptions were packaged from the beginning of 2015. The two-day local papers, Viiskunta and Suupohjan Sanomat, will come out once a week starting in 2015. Retaining the current circulations is possible only if the local papers continue to implement a policy of balanced journalism with a strong local angle.
THE USE OF DIGITAL channels increased in 2014. The number of consumers with digital subscriptions grew markedly, meaning that the overall reach of the papers remained excellent.
Annual Report 2014
PUBLISHING
Digital advertising became an even more important part of the total offering of media sales in 2014. Excellent overall reach and the multi-channel media portfolio offer a superior meeting place for regional companies and consumers.
Mobility, i.e. the use of content on mobile phones and other portable devices, grew strongly, and the same trend continues. For this reason, we are investing in the usability of content on all devices.
IN CONSUMER MARKETING, the development of Ilkka's circulation is slightly above the national average, while Pohjalainen is on a par with the average. The overall reach of the provincial newspapers has remained excellent. Ilkka has an average of 147,000 readers, including digital devices (NRS Consumer 2013). The equivalent figure for Pohjalainen is 92,000 readers. Income from digital subscriptions grew by more than 50% during the year. Consumer advertisements also increased year-on-year. Subscriber relationships were strengthened by offering benefits to readers with continuous subscriptions.
IN CORPORATE MARKETING, the declining trend in advertisement income corresponded to the national trend. New product packages combining print and digital have been introduced so as to boost the effect of advertising. Developments made at the sales and marketing interface improve the opportunities to serve existing and future customers even better.
Corporate marketing offers a seamless chain where sales and marketing support each other and provide the customer with comprehensive service at the right time. Preparations are under way for a new customer group-specific operating model.
NEWSPAPER DELIVERY changed when part of the deliveries in the coastal regions of Ostrobothnia were transferred to HSS Media in June 2014. At the same time, weekend deliveries in Kokkola were transferred to Keski-Pohjanmaan Kirjapaino Oyj. In September 2014, HSS Media's delivery area was expanded to also cover the City of Jakobstad (Pietarsaari) and its surroundings.
In the summer of 2014, negotiations were initiated with Posti with a view to concluding a new delivery agreement, which should take effect in 2016.
The deliveries of Ilkka-Yhtymä's provincial and local papers have been 100% carbon neutral since 1 February 2011 (Itella Oyj press release on 1 Feb 2011). The deliveries of the Group's free sheets have also been carbon neutral from the beginning of 2013.
KEY FIGURES
NET SALES, EUR 1 000
OPERATING PROFIT, EUR 1 000
AVERAGE NO. OF EMPLOYEES
2014 2013
CIRCULATION
Audited total circulation in 2014
| Ilkka | 47 021 |
|---|---|
| Pohjalainen | 21 161 |
| Komiat | 6 140 |
| Viiskunta | 5 331 |
| Järviseutu | 5 006 |
| Suupohjan Sanomat | 3 804 |
| Jurvan Sanomat | 1 983 |
| Vaasan Ikkuna *) | 50 314 |
| Etelä-Pohjanmaa *) | 46 800 |
*) distribution
Annual Report 2014 | 15
PRINTING
"The marketing logistics services make it possible for customers to focus on their core competencies."
Seppo Lahti
Managing Director, I-print Oy
KEY FIGURES
NET SALES, EUR 1 000
OPERATING PROFIT, EUR 1 000
AVERAGE NO. OF EMPLOYEES
2014
2013
Improved logistics and new products
At I-print Oy, new products are introduced to support printing. By offering multiple channels, we can serve our customers more effectively.
THE PRINTING HOUSE developed marketing logistics services in 2014. Customers can now outsource their marketing logistics services to I-print and focus on their core competencies. The service supports companies' direct marketing activities by, for example, maintaining a customer register, storing material, packing and posting, and printing products.
THE NEWSPAPER PRINTING service prints millions of papers every month. As a national player, we are constantly developing new formats in order to meet our customers' communications needs. In addition to standard-size four-colour products in tabloid and broadsheet, we can deliver newspapers cut to the desired size.
COMMUNICATIONS AGENCY I-print I plus has diversified into the creation of social media content. Social media campaigns have captured the interest of customers, as have new kinds of marketing campaigns mixing images, stories, video and social media. Besides its core service of producing customer magazines, the agency can now offer more effective marketing across a range of channels.
THE LEVEL AND SCOPE of expertise in cross-media is also seen as an important resource in 2015. Skills have been developed both in-house and by making use of partners' know-how.
The Graphic Industry in Finland
THE VOLUME OF PRINTING and related services is estimated to have decreased by approximately 13% in 2014. The drop in the export of printed material was estimated at around 10%.
According to the Business Tendency Survey published by the Confederation of Finnish Industries (EK) on 4 February 2015, economic conditions in the
printing sector remain modest. Almost all companies in the industry describe their outlook as weak.
Production volume has continued to decrease, and is expected to keep falling in the coming months. Order backlogs and demand continue to be weak. Staff numbers and profitability are expected to decline further.
Annual Report 2014
PERSONNEL
Iikka-Yhtymä wants to be an attractive workplace for current and new generations.
DIGITALISATION, changes in customer behaviour and competition have altered, and will continue to alter, Ilkka-Yhtymä's operations. The evolving operating environment offers new kinds of growth opportunities for everyone.
As a responsible employer, Ilkka-Yhtymä constantly invests in employee skills, good leadership and well-being at work. In training and skills improvement, the focus is on the development of function-specific core competencies and individuals' expertise. Growing digitalisation and changes in customer behaviour call for new services and products, as well as new ways of working in the workplace and in various collaborative networks. For employees, this change provides an opportunity to be involved in the development of operations and to improve their skills. The Group's operations are based on the entire staff's common understanding of the company's values, strategy and objectives.
IN 2014, the Group implemented adjustment measures which applied to all employees. For personnel, the savings achieved corresponded to roughly one week's salary costs. In the year under review, the headcount decreased by an average of ten man-years, with all functions being affected.
As the number of employees has declined, collaboration has increased in the creation of newspaper content. New collaborative networks, such as Lännen Media, have strengthened development and secured sufficient resources and a key position for the company in the Finnish newspaper field.
All employees are covered by an incentive scheme confirmed annually by the Board of Directors.
Paula Mahlamäki
Head of Hill, Ilkka-Yhtymä Oyj
AVERAGE NUMBER OF FTE EMPLOYEES
AVERAGE NUMBER OF ALL EMPLOYEES
348
STAFF BROKEN DOWN BY FUNCTION
- Editorial unit 33%
- Production company 22%
- Consumer marketing 15%
- Local newspapers 11%
- Corporate services 9%
- Corporate marketing 7%
- Web and mobile operations 3%
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18 | Annual Report 2014
Corporate responsibility has been the cornerstone and driving force behind Ilkka-Yhtymä's operations throughout the firm's more than century-long history.
CORPORATE RESPONSIBILITY
THE GROUP is strongly committed to its home region. In many respects, this is reflected in the operations of the Group and its various parts.
RESPONSIBILITY IS crystallised in the Group's values, mission and vision. Ilkka-Yhtymä is an Ostrobothnian communications company with customer-driven, reliable and networked operations. It actively contributes to the sector's development and generates economic and cultural added value for its stakeholders. By participating in cultural and sports events, both large and small, within its circulation areas, the Group promotes the region's sense of community and, thereby, takes responsibility for general well-being.
THE GROUP AIMS to develop the region by participating in chamber of commerce activities and those of entrepreneurial organisations, as well as in joint marketing of the region. It also supports the region's universities and other higher education institutions through donations and, via cooperation agreements, promotes voluntary civic activities. The Group's newspapers are working with schools with the aim of supporting regional institutions - from day-care centres to universities - in their media education and use of newspapers in teaching.
THE GROUP'S AMBITION to develop the region can also be seen in its objective of building a competitive and modern communications infrastructure. Development of electronic communications and electronic services is an integral part of these efforts. The Nordic Ecolabel awarded to I-print Oy is further proof of the Group's responsibility. Printed products bearing this label are among the best in class in terms of their environmental impact.
Annual Report 2024 | 19
KÄNJÖT SANIN!
KÄNJÖT
Säntä vaatii ja strategista ja strategista
KÄNJÖT SANIN!
KÄNJÖT
Säntä vaatii ja strategista ja strategista
KÄNJÖT SANIN!
KÄNJÖT
Säntä vaatii ja strategista
KÄNJÖT SANIN!
KÄNJÖT
Säntä vaatii ja strategista
KÄNJÖT SANIN!
KÄNJÖT
WE ARE INNOVATIVE
Lännen Media establishes
A MAJOR MEDIA NETWORK
LÄNNEN MEDIA is taking regional papers to a new level: the web and video bring together journalists from 13 locations to create a major national player.
S
ix media companies, 12 regional papers and 40 journalists. This is the formula being used to build a modern media network for national news coverage.
Ilkka-Yhtymä embraced this collaboration in which the leading regional media invest in future communications. Lännen Media's editorial staff was formed by selecting 40 writers from the partner newspapers specialising in national and international topics.
One of them is Jorma Havula, a former local reporter who now works for Lännen Media's supplements department. He says that the first steps of the large editorial unit have been tentative. Although matters were already discussed in the autumn, working methods are only now being honed when actual stories are in the making.
"We have quite a number of different stakeholders and parties that need to be taken into account. We must always ask some questions first: Has a topic just been covered by one of the partner papers? Is Lännen Media's newsroom working on the topic? How will photos and the visual side be managed? And so on."
"Stories must be planned in advance as fully as possible. This is not difficult in profile stories, but in features it can be, if the interviewees are scattered around the country and photos are not enough to make the story compelling," Havula explains.
WHEN DISTANCES ARE LONG, technology brings people together. Video conferences, video calls and instant messaging services are a natural part of the work of the regional papers' new shared editorial team.
The new unit draws strength from its roots. Regional topics are the most important to the papers, but in the future, they also want to offer their readers higher-profile national and international content. Lännen Media's impact is shown in the rich and varied content of the papers.
"This means that there are all kinds of stories from across Finland, from Lapland to Helsinki. The writers are journalists who know the areas and people well, so the stories are sure to convey a true and accurate picture. A large media network is also visible nationally, and I believe we can quickly get interviews from, for example, top-level policy makers. Ministers and others cannot afford to overlook two million readers," Havula points out.
Annual Report 2014
WE SUCCEED
ENTHUSIASM breeds success
KOMIAT is a rare example of a local paper that has also achieved fame on the web.
Published in Kauhava, Komiat has shown its power in the online world. For the second time, it has won the online category for local papers published once a week in a competition held by the Finnish Newspapers Association. The paper last won this category in 2012. In 2011, it received a commendation in the newspaper category.
The slow pace of publication does not dampen the editorial team's enthusiasm. Reporter Anu Nahkala says that the paper deliberately focuses on online content: the reporters post videos, news items and Facebook updates whenever something interesting happens locally.
"We are really stretching our job descriptions, as increasingly the same person not only conducts interviews and writes stories, but also takes photos and videos. In addition, videos are edited, after which they can be called news videos and not just recordings. Using multiple channels suits us and our restless personalities," Nahkala sums up.
SOCIAL MEDIA adds a new dimension to the paper's involvement in the local community. The small editorial department also follows the latest developments outside working hours, by updating the paper's Facebook page. On Twitter, the paper sends a couple of tweets per day. If something noteworthy happens, a tweet is sent whatever the time.
Komiat is the first to report on the web on subjects such as who the new city manager of Kauhava is. The reporters also have an eye for showing on video what the atmosphere is like at a children's concert. The local paper's online presence is just what it should be: it observes life in Kauhava and dares to dig deeper.
Nahkala says that putting content online even outside working hours feels great and is rewarding.
"We are not forced to spend our time at the keyboard, but we have a genuine enthusiasm and passion to serve our readers to the best of our abilities," she assures.
Annual Report 2014
Social media adds a new dimension to the paper's involvement in the local community.
Annual Report 2014 | 23
24 | Apeldoftfoto
WE CARE
FREE SHEETS
bring life to the streets
FREE SHEETS can also contribute to their city's development. They can be active organisers of events that bring life to the streets and create new opportunities for entrepreneurs.
The editors of Vaasan Ikkuna and Epari think that free sheets must be visible in the streets and bring activity to them. Encouraged by this idea, the papers have begun to produce events in collaboration with local entrepreneurs.
"Local papers should also be present in the streets in forms other than the actual paper. Through events, we can also market our paper and spark positive interest among readers," says Vaasan Ikkuna's chief editor Vesa Koivumäki.
Vaasa has hosted Ikkuna Festivaali for three years running. Epari followed suit and organised its own festival, Keskikaupungin yö, in Seinäjoki for the first time last autumn.
Both events have been successful financially and in terms of their programme. Restaurants have reported record sales, measured in cash or numbers of customers.
"It's beneficial for free sheets if their advertisers are doing well," says Epari's chief editor Laura Syväoja.
PRODUCING EVENTS is a far cry from the traditional making of newspapers, but crossing boundaries is nothing to be afraid of.
"When the chief editor distributes posters and travels around inspiring entrepreneurs, it's quite removed from the paper's core operations. But then again, meeting people is right at the core," Syväoja notes.
"Events require a lot of extra work, and they are significant investments for the paper. However, they do support the paper's business operations," Koivumäki adds.
Events testify to the power of cooperation between a paper and entrepreneurs, and also between the two sister papers. Epari took a proven concept from Vaasan Ikkuna and added some elements of its own. Now they are developing the concept together.
"We learn from the feedback provided by entrepreneurs and from each other. We engage in continuous dialogue with local people, which helps us to improve the paper," Koivumäki says, listing the benefits.
Local papers should also be present in the streets in forms other than the actual paper.
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WE RESPECT
Reaching new heights through
TRAINING
GRAPHIC DESIGNER Mirja Pajula is undertaking further training to expand her professional skills. Studying while working is beneficial both for the employee and the employer.
Mirja Pajula, a graphic designer at Ilkka-Yhtymä's communications agency I-print I plus, went back to study in the autumn. Alongside her work, she is studying to be a media designer, i.e. completing a further qualification in audiovisual communication. The training takes two years.
"I want to deepen my skills in the world of print and learn new things about digital communications. The training is also suitable for old hands like me. The average age in our class is around forty," Pajula says.
The training is organised by AEL, a leading provider of technical training services in Finland. Contact teaching days held in Helsinki and on-the-job learning are supported by Optima, a web-based learning environment.
The admission requirement for the media designer training was a good working knowledge of print communications. Pajula had no difficulty meeting this requirement. She has worked for almost 27 years in the field: first as a page compositor at I-print's printing house, and for the last seven years as a graphic designer at the communications agency of the same company.
PAJULA FINDS studying while working to be fun and interesting, although it requires careful time management. Lessons are quick-paced, so studying is largely based on the students revising and practising the matters by themselves.
"An apprenticeship is an ideal way to update your skills. It offers a great opportunity to learn on the job, since you can put what you have learned into practice right away in various projects."
"For example, I have created the graphic design for I-print's new website as my final project. What is most rewarding is that learning new things also increases your work motivation and confidence in your professional skills," Pajula adds.
ILKKA-YHTYMÄ encourages its employees to develop their skills and work. Supervisors play a key role in assessing employees' current skills and identifying ones needed in the future. Ilkka-Yhtymä Group's philosophy is to offer all of its employees equal opportunities for training and skills development.
Annual Report 2014
Ilkka-Yhtymä Group offers all of its employees equal opportunities for training and skills development.
Annual Report June 1 27
ILKKA-YHTYMÄ GROUP
28 | Annual Report 2014
Annual Report 2014 | 29
FINANCIAL STATEMENTS
FINANCIAL STATEMENTS
Report by the Board of Directors
GROUP STRUCTURE
The Ilkka-Yhtymä Group is a media group that consists of the parent company Ilkka-Yhtymä Oyj, the publishing company I-Mediat Oy, as well as the printing company I-print Oy. The Group also includes two property companies, Kiinteistö Oy Seinäjoen Koulukatu 10 and Seinäjoen Kassatalo Osakeyhtiö, as well as Pohjalaismediat Oy. Our main products are the regional newspapers Ilkka and Pohjalainen, five local newspapers (Viiskunta, Komiat, Järviseutu, Suupohjan Sanomat and Jurvan Sanomat), two free sheets (Vaasan Ikkuna and Etelä-Pohjanmaa), including the online and mobile services of these papers, and I-print Oy's printing and communications services.
The associated companies included in our consolidated financial statements are Alma Media Corporation, Arena Partners Oy and Yrittävä Suupohja Oy. Our holding in Väli-Suomen Media Oy was sold in June 2014.
CONSOLIDATED NET SALES AND PROFIT PERFORMANCE
Consolidated net sales decreased by 6.9%, amounting to EUR 41,802 thousand (EUR 44,893 thousand in 2013). External net sales from publishing operations decreased by 4.6%. Advertising revenues fell by 7.8% and circulation revenues by 1.6%. External net sales from the printing business decreased by 19.5%. Circulation income accounted for 46% of consolidated net sales, while advertising income and printing income represented 41% and 13%, respectively. Other operating income totalled EUR 454 thousand (EUR 392 thousand).
The Group operating expenses for the financial year amounted to EUR 37,319 thousand (EUR 39,293 thousand), down by 5.0% year-on-year. Expenses arising from materials and services decreased by 7.6%. Personnel expenses decreased by 1.4%. Other operating costs decreased by 7.2%. Depreciation contracted by 10.7%.
The share of the associated companies' result was EUR 4,318 thousand (in financial year 2013, EUR -22,630 thousand following the EUR 27 million write-down on the holding in the associated company Alma Media Corporation). Operating profit from the Group's own operations, excluding Alma Media Corporation and the other associated companies, amounted to EUR 4,933 thousand (EUR 5,999 thousand), representing 11.8% (13.4%) of net sales. Reported operating profit was EUR 9,251 thousand (operating loss EUR 16,631 thousand in 2013). Reported operating margin was 22.1 (-37.0).
Net financial income amounted to EUR 883 thousand (net financial expenses in the corresponding period of the previous year EUR 347 thousand). Interest expenses excluding the fair value change in derivatives hedging them totalled EUR 1,678 thousand (EUR 1,789 thousand). In order to hedge against interest rate risk, the company has transformed some of its floating-rate liabilities into fixed-rate liabilities, by means of interest rate swaps. Given that the Group does not apply hedge accounting, unrealised changes in the market value of the interest rate swaps are recognised through profit or loss. For the 2014 financial year, the market value of these interest rate swaps fell by EUR 102 thousand (in 2013, the market value grew by EUR 734 thousand). Net gain/loss on shares held for trading was EUR -130 thousand (EUR 22 thousand). Financial income for the period includes a capital gain of EUR 2 million from the sale of Anvia Oyj's shares.
Profit before tax totalled EUR 10,133 thousand (loss before tax EUR 16,978 thousand for the financial year 2013). Direct taxes amounted to EUR 1,063 thousand (EUR 1,199 thousand), and consolidated profit for the period
Annual Report 2014
FINANCIAL STATEMENTS
totalled EUR 9,070 thousand (loss EUR 18,178 thousand). Earnings per share amounted to EUR 0.35 (EUR -0.71)
CONSOLIDATED BALANCE SHEET AND FINANCING
The consolidated balance sheet total came to EUR 130,536 thousand (EUR 133,802 thousand), with EUR 64,503 thousand (EUR 58,091 thousand) of equity. On the reporting date of 31 December 2014, the balance sheet value of the holding in the associated company Alma Media Corporation was EUR 104.5 million and the market value of the shares was EUR 61.8 million. According to the management's estimate, write-down in this holding is unnecessary.
At the end of the 2014 financial year, interest-bearing liabilities totalled EUR 56,936 thousand (EUR 66,379 thousand on 31 December 2013), and their average maturity was 3 years 11 months (3 years 5 months on 31 December 2013).
In order to hedge against interest rate risk, the company has transformed some of its floating-rate liabilities into fixed-rate liabilities, by means of interest rate swaps. Presently, some 53% of the loans in the company's total loan portfolio have a fixed rate and some 47% a floating rate. These hedging measures included, the average interest rate for interest-bearing liabilities on 31 December 2014 came to 2.50% (2.53%).
As at 31 December 2014, the impact of floating-rate interest-bearing liabilities on profit before taxes would have amounted to -/+ EUR 267 thousand over the next 12 months, if the interest level increases or decreases by one percentage point. Of interest-bearing liabilities existing during the 12 months following the financial year, a total of EUR 2,353 thousand will fall due for payment.
Group net gearing was 78.0% (108.7%)
at the end of the financial period. Equity ratio was 50.2% (44.2%) and shareholders' equity per share stood at EUR 2.51 (EUR 2.26). The increase in financial assets for the period totalled EUR 3,553 thousand (decrease EUR 282 thousand), with liquid assets at the end of the period totalling EUR 5,534 thousand (EUR 1,980 thousand).
For the financial year, cash flow from operations came to EUR 3,710 thousand (EUR 8,502 thousand). Cash flow from operations for previous financial year 2013 includes EUR 6,253 thousand from the Group's own operations as well as EUR 2,249 thousand of dividend income from Alma Media Corporation. Cash flow from investments amounted to EUR 11,841 thousand (EUR -750 thousand), including repayment of capital from Alma Media Corporation in the amount of EUR 2,249 thousand and EUR 9,462 thousand proceeds from the sale of Anvia Oyj's shares.
PUBLISHING
The Group's publishing segment comprises the publishing company I-Mediat Oy. During the year, net sales from publishing totalled EUR 36,413 thousand (EUR 38,257 thousand). Net sales from the publishing business decreased by 4.8%. The decrease in net sales from the publishing business was mainly caused by a weaker advertising market. Advertising revenues fell by 7.8% and circulation revenues by 1.6%. Operating profit from publishing decreased by 24.2% year-on-year, to EUR 3,481 thousand (EUR 4,594 thousand).
Due to weak and uncertain economic situation, it is still difficult to forecast media income in 2015. Media advertising in Finland is projected to remain almost unchanged from the previous year, and newspaper circulation income is expected to fall. Net sales of I-Mediat Oy are expected to remain almost the same as in the previous year.
PRINTING
The printing segment comprises the printing house I-print Oy. The segment's net sales amounted to EUR 12,333 thousand (EUR 13,763 thousand), down by 10.4%. External net sales from the printing business declined by EUR 1,323 thousand (19.5%) due to tough competition and the weaker market. Operating profit from printing decreased by 4.3% year-on-year, to EUR 1,749 thousand (EUR 1,827 thousand).
Within the printing business, the 2015 market situation is expected to remain extremely difficult in Finland. The overcapacity will continue in the graphics industry, while the total volume of printed products market will decrease. The rise in raw material and energy costs is expected to be moderate. I-print Oy's net sales are projected to remain roughly the same as in the previous year.
ASSACIATED COMPANIES
Ilkka-Yhtymä Group's associated companies are Alma Media Corporation (29.79%), Arena Partners Oy (37.82%) and Yrittävä Suupohja Oy (38.46%). Our holding in Väli-Suomen Media Oy was sold in June 2014.
Alma Media focuses on publishing operations and digital consumer and corporate services. Its high-profile newspapers are Aamulehti, Iltalehti and Kauppalehti.
In 2013, Ilkka-Yhtymä's provincial newspapers Ilkka and Pohjalainen and Alma Media's regional and local newspaper division Alma Regional Media initiated extensive operational collaboration on content and development. At the end of 2014, responsibility for the co-operation was largely transferred to the newly established Lännen Media Oy. The founding newspapers behind Lännen Media include Ilkka-Yhtymä's newspapers Ilkka and Pohjalainen, Alma Media's newspapers Aamulehti, Satakunnan
Annual Report 2014 | 31
FINANCIAL STATEMENTS
Kansa, Lapin Kansa, Kainuun Sanomat and Pohjolan Sanomat as well as Kaleva, Turun Sanomat, Keskipohjanmaa, Hämeen Sanomat and Forssan Lehti, which is part of the same company.
Arena Partners Oy is a digital business development and production company jointly owned by five provincial newspaper companies. Arena Partners owns a 35% share of Alma Mediapartners Oy, which is Alma Media's housing sales, vehicle and consumer advertising marketplace company operating in Finland. The Arena Partners Group also includes the subsidiary Arena Interactive Oy (65%), focusing on mobile services, the recruitment agency Uranus Oy (36.16%) and Adfore Technologies Oy (11.8%).
Yrittävä Suupohja Oy publishes Suupohjan Seutu, a free sheet distributed in the Suupohja region.
ILKKA-YHTYMÄ SOLD ITS ANVIA OYJ SHARES TO ELISA CORPORATION
Ilkka-Yhtymä Oyj and its subsidiaries I-Mediat Oy and I-print Oy sold all of their Anvia Oyj shares to Elisa Corporation on 28 August 2014. The shares were sold for EUR 9.5 million, and Ilkka-Yhtymä Group recorded a capital gain of approximately EUR 2 million for the sale.
NEWSPAPERS TO COLLABORATE MORE CLOSELY THROUGH LÄNNEN MEDIA
On 23 June 2014, Ilkka-Yhtymä Oyj's subsidiary I-Mediat Oy and five other Finnish newspaper publishers signed a cooperation agreement to establish Lännen Media Oy. The nationwide editorial staff of 40 people began its work in October 2014. Lännen Media Oy produces content for 12 provincial newspapers in western and northern Finland.
The shared editorial staff will produce nationwide Finnish and international news content, timely articles to shed light on the facts behind the news, weekend supplement material, daily theme pages and nationwide online news.
The Lännen Media newspapers reach almost two million Finns (1,980,000). The combined circulation of the printed newspapers is 516,375 copies (FABC Audit 2013) and they are read by 1.28 million readers.
ILKKA-YHTYMÄ'S NEWSPAPERS TO BE PARTLY DISTRIBUTED BY HSS MEDIA
Ilkka-Yhtymä Oyj's subsidiary I-Mediat Oy has started distribution co-operation with HSS Media in the Swedish-speaking coastal regions of Ostrobothnia.
As from 1 June 2014, I-Mediat Oy's provincial newspapers Pohjalainen and Ilkka gradually started using the distribution services of HSS Media in the Swedish-speaking municipalities of Ostrobothnia, with the exception of Vaasa and Mustasaari. In Vaasa and parts of Mustasaari, the newspapers will still be distributed by Posti Group in the early hours.
RESEARCH AND DEVELOPMENT EXPENSES
In the Group's publishing business, product development for multiple channels has been carried out with Arena Partners Oy, its shareholding newspapers and the Next Media programme of Finnmedia (Federation of the Finnish Media Industry). Product development has been focused on customer-oriented services relating to news reporting, transactions and communities. With regard to the Group's printing business, the focus was on the development of value-added services and products.
CAPITAL EXPENDITURE
Reported capital expenditure for the year totalled EUR 464 thousand, with printing accounting for EUR 85 thousand and publishing for EUR 181 thousand.
GOVERNANCE PRINCIPLES
Ilkka-Yhtymä Oyj adheres to the Finnish Corporate Governance Code for listed companies, issued by the Securities Market Association on 15 June 2010 and having entered into force on 1 October 2010. Ilkka-Yhtymä Oyj's Corporate Governance Code is detailed and maintained on the Ilkka-Yhtymä website at www. ilkka-yhtyma.fi, under Sijoittajat - Hallinnointi (Finnish web address only). The Corporate Governance Statement can be found under this section on the website.
ANNUAL GENERAL MEETING, SUPERVISORY BOARD AND BOARD OF DIRECTORS
On 24 April 2014, the Annual General Meeting (AGM) of Ilkka-Yhtymä Oyj approved the financial statements, discharged the members of the Supervisory Board and the Board of Directors and the Managing Director from liability and decided that a per-share dividend of EUR 0.10 be paid for the year 2013.
The number of members on the Supervisory Board for 2014 was confirmed to be 25. Of the Supervisory Board members whose term had come to an end, the following were re-elected for the term ending in 2018: Kari Aukia, Sami Eerola, Jari Eklund, Johanna Kankaanpää, Yrjö Kopra, Juha Mikkilä and Sami Talso.
At the Annual General Meeting, it was decided to maintain the payments made to the Chairman of the Supervisory Board and the board members at their current level: the Chairman will receive a retainer of EUR 1,500 per month and a fee of EUR 400 per meeting, and the board members will be paid a fee of EUR 400 per meeting attended. The board members' travel expenses are reimbursed in accordance with the current maximum level specified
Annual Report 2014
FINANCIAL STATEMENTS
by the tax authorities.
Ernst & Young Oy, Authorised Public Accountants, was elected as the auditor, with Authorised Public Accountant, M.Sc. (Econ.) Harri Pärssinen as the principal auditor. It was decided that the auditors would be reimbursed as per the invoice.
The AGM authorised the Board of Directors to decide upon a donation to be put toward charitable causes or similar, totalling, at maximum, EUR 50,000, as well as to decide upon the recipients, purposes of use, schedules and other terms of these donations.
At its meeting on 5 May 2014, the Supervisory Board re-elected Esa Lager and Riitta Viitala to the Board of Directors of Ilkka-Yhtymä Oyj when their terms of service had come to an end. Seppo Paatelainen announced that he would step down from the Board. Markku Hautanen, M.Sc. (Econ.), CEO of the Skaala Group, was elected as his replacement for the remainder of the term (ending in 2015). Lasse Hautala will continue as chairman of the Supervisory Board, while Perttu Rinta will continue as vice-chairman.
At its membership meeting, the Board of Directors elected Timo Aukia as its chairman and Esa Lager as its vice-chairman. The Board of Directors of Ilkka-Yhtymä Oyj now has the following membership: chairman Timo Aukia, vice-chairman Esa Lager, members Markku Hautanen, Sari Mutka, Tapio Savola, and Riitta Viitala.
DIVIDEND
The Board of Directors proposes to the Annual General Meeting of 22 April 2015 that a per-share dividend of EUR 0.10 be paid for the financial year 2014, representing a total dividend payment of EUR 2,566,520.80. Dividends will be distributed to those who are listed on the record day, 24 April 2015, as shareholders in the Ilkka-Yhtymä Oyj's list of shareholders, maintained at Euroclear Finland Oy. Dividend payments are issued on 4 May 2015. On 31 December 2014, the parent company's distributable funds amounted to EUR 55,037,623.59.
Ilkka-Yhtymä Oyj practises an active dividend policy and aims to distribute at least half of its consolidated annual income as dividend payments. However, dividend distribution is affected not only by the earnings trend, but also by the Group's financial standing, the financing required for profitable growth and the company's future outlook and development needs.
AUTHORISATION OF THE BOARD OF DIRECTORS
On 19 April 2010, the Annual General Meeting authorised the Board of Directors to decide upon a share issue and/or granting stock options and/or other special rights and upon their conditions.
The maximum number of Series II shares issued is 7,700,000, corresponding to around 30% of the company's total shares and 36.05% of Series II shares at present.
This authorisation includes the right to issue shares and/or stock options, and/or other special rights, as distinct from the shareholders' pre-emptive rights, under conditions prescribed by law, and the right to decide upon a free issue to the company itself.
The authorisation is valid for five years from the date of the AGM's decision.
On 4 November 2010, Ilkka-Yhtymä Oyj purchased 7,250,000 shares in Alma Media Corporation from Oy Herttaässä Ab. From the share purchase price, EUR 30 million was paid in cash. In addition, Ilkka-Yhtymä decided to issue freely negotiable convertible bonds, with a value of EUR 20.0 million, to the seller. The bond issue decision taken by Ilkka-Yhtymä's Board of Directors is based on the authorisation granted to it by the AGM on 19 April 2010.
In addition to this, the company has not issued any option rights or other special rights.
The Board of Directors is not authorised to acquire or sell company's own shares.
SHARES
At the end of 2014, the company's share capital totalled EUR 6,416,302. The number of shares was 25,665,208, of which 4,304,061 were Series I shares (20 votes per share) and 21,361,147 were Series II shares (1 vote per share). Shares of both series entitle the holders to the same dividend.
According to the Articles of Association, a single shareholder at a General Meeting may not use more than one twentieth (1/20) of the entire number of votes represented in a meeting.
The transfer of Series I shares is restricted by an approval clause. According to this clause, Series I shares cannot be transferred to another holder without the approval of the Board of Directors.
Further information on the shares, shareholders and holding structure of Ilkka-Yhtymä Oyj can be found in the Section Shares and Shareholders, pp. 73-78.
Per-share ratios are presented on page 62.
PERSONNEL
In the year under review, the Group had, on average, 348 employees with employment contracts, the corresponding figure for the parent company being 26. On 31 December 2014, the Group had
Annual Report 2014 | 33
FINANCIAL STATEMENTS
294 full-time employees, whereas the parent company had 23.
The average number of employees (full-time equivalents)
| 2014 | 2013 | 2012 | |
|---|---|---|---|
| Group | 311 | 321 | 336 |
| Ilkka-Yhtymä Oyj | 24 | 24 | 25 |
Salaries and fees, thousands of euros
| 2014 | 2013 | 2012 | |
|---|---|---|---|
| Group | 13,760 | 13,935 | 14,543 |
| Ilkka-Yhtymä Oyj | 1,626 | 1,600 | 1,610 |
Ilkka-Yhtymä Group's entire personnel has been covered by an incentive scheme since 2000. According to the Articles of Association, Ilkka-Yhtymä Oyj's Supervisory Board must include two employee representatives.
On 6 May 2014, Ilkka-Yhtymä announced that it would start adaptation measures in order to safeguard profitability. As part of these measures, the company launched negotiations concerning all personnel in line with the Act on Co-operation within Undertakings.
As the outcome of these negotiations, personnel savings was largely achieved through temporary layoffs of all employees. The savings corresponded to layoffs of around one week during the second half of 2014. As a result of voluntary retirement and the part-time employment and redundancies agreed upon in the codetermination negotiations, Ilkka-Yhtymä permanently reduced its full-time employees by about 10. These personnel savings, coupled with other adaptation measures, yielded the targeted cost-savings of EUR 0.6 million in 2014.
QUALITY AND ENVIRONMENT
As with the whole graphics industry, Ilkka-Yhtymä Group has a minor impact on the environment.
The company plans the classification, utilisation and handling of side products and waste created during business operations. The aim is to reduce the consumption of materials and safely dispose of waste. Waste paper created during the printing process and printing blocks is recycled. Printing ink waste, plate developing agent waste, solvent waste, and other waste products created during the printing process which are harmful to the environment are delivered to a facility for their treatment.
In accordance with legislation on waste products, the company's responsibility for the use of packaging is handled through the packaging industry's environmental register Pakkausalan Ympäristörekisteri PYR Oy. Responsibility for the recycling of waste paper and imported paper is handled through the paper recycling organisation Paperinkeräys Oy.
In 2012, I-print Oy was awarded the Nordic Ecolabel certification (the Swan) for its printing operations. The company's right to use the Swan Label continues after the introduction of the new, stricter criteria in 2014. Most of the products printed by I-print Oy in 2014 bore the Swan Label.
Deliveries of Ilkka-Yhtymä's provincial and local papers, made by Posti Group Oyj, have been 100% carbon neutral since 1 February 2011 (Itella Oyj press release on 1 Feb. 2011).
ESTIMATED OPERATING RISKS AND UNCERTAINTIES
The Risk Management Policy of Ilkka-Yhtymä Group is approved by the Board of Directors and is part of the Group's management system, also approved by the Board. The Risk Management Policy includes a written document and descriptions of key risks and the related management measures defined in separate risk databases. For identified key risks, risk management responsibilities have been defined by profit centre, by subsidiary and at Group level, and those assigned as being responsible have the capabilities required for risk management tasks. The Group's risk management procedures are consistent and known by the staff participating in holistic risk management.
Ilkka-Yhtymä's most significant short-term risks are related to the development of media advertising, as well as circulation and printing volumes. In a weak economic climate, these risks affect the entire sector. In the longer term, there is a risk of a potential decrease in circulation and advertising volumes, if consumers choose to switch to competitors' alternative digital services. Through its holding in Alma Media stock, the company is also exposed to risks related to Alma Media's profit-making capacity, dividend policy and the price development of its shares.
Communications industry
The company estimates that the Group's core operations only involve risks normally associated with the industry operating in a changing business environment. Such industry risks are mainly related to the development of media advertising and content consumption, since more and more alternatives are being offered to consumers and advertisers. A prolonged weak economic situation and a slow recovery will have a negative impact on the consumption of media products and services. Competition in the industry is being affected by the digitalisation of content and advertising, the emergence of new distribution channels, growth in advertiser-funded content, changes in media use and ways of spending time, as well as by the new operating methods and the actors these are enabling.
Publishing
In the long term, regional demographic and economic developments will have an impact on provincial and local newspapers' circulation and advertising
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FINANCIAL STATEMENTS
income. A healthy circulation coverage percentage, a competitive contact price and strong relationships with readers are enhancing provincial and local newspapers' competitiveness in the advertising market. The strong growth seen in the volumes of online and mobile users has extended the overall reach of provincial newspapers.
In general, ordinary economic cycles have not had a major impact on local or provincial newspapers' circulation income. On the other hand, media advertising volumes reflect changes in economic cycles, competitive situations and the outlook of advertisers' own industries. Media sales took a downturn in spring 2012, and the trend still continued in 2014.
Economic cycles, the regional volume of the advertising market and other competitive conditions all have an influence on the rate of market entry and exit of new media, such as free sheets and digital services. Like most other newspaper groups, Ilkka-Yhtymä has years of experience of its own free sheets and digital services. Their extensive offering and high quality, and local customer relationships give a competitive edge.
Due to the consumer behaviour enabled by new technology, some classified advertisements, such as car, housing and job advertisements, have shifted online. In response to this development, Ilkka and Pohjalainen are engaged in collaboration with Arena Partners and Alma Mediapartners. Arena Partners Oy has a 35% holding in the Etuovi.com, Vuokraovi.com and Autotalli.com services displaying housing and car advertisements. This will enable us to provide the sector's best services to customers. New players in the market include for instance international search engine companies.
In order to face the challenges posed by changing reading habits among young people and the growing volumes of online content available for consumers
free of charge, Ilkka-Yhtymä Group is providing its provincial newspapers' premium online and mobile services for the benefit of the region's consumers. In line with the allied Arena Partners' strategy, the aim is for these services to become the leading place for digital news, services, transactions and commerce for consumers, communities and companies in our operating provinces.
Graphics
The aggressive price competition in Finland's printing sector is continuing. Developments in circulation and advertising volumes are reflected in the numbers of pages in newspapers, while general economic trends are affecting the use of other advertising media. Exports to the Nordic countries are dependent not only on market conditions, but also on the development of exchange rates.
The availability of newsprint has been good and price developments in recent years have been moderate. Pricing pressures may increase in the future, since the paper industry's capacity cuts were intended to safeguard future profitability. I-print Oy has prepared for both availability and price risks by spreading purchases among suppliers and through joint procurement with other actors within the industry.
Newspaper distribution has been outsourced to Posti Group Oyj and HSS Media Ab. The short-term risks in delivery operations mainly concern price and service level developments. These risks depend on the diminishing volumes, pay development of deliverers, competition between delivery companies and the reform of the Postal Services Act. In the longer term, the availability of distribution services as well as the related price risks will increase.
The management of the company's financial risks is illustrated in section 23 of the notes.
The key figures describing our financial development are presented on page 62.
EVENTS AFTER THE FINANCIAL YEAR
On 30 January 2015, Ilkka-Yhtymä Group announced that the Group's publishing company I-Mediat Oy and the printing house I-print Oy will start cooperation negotiations. The negotiations will mainly concern I-Mediat Oy's technical production and media sales personnel and the personnel of the printing press I-print Oy.
The purpose of the negotiations is to adjust the operations and the amount of personnel to the requirements of increasingly digital operations and reducing volumes.
The negotiations may lead to lay-offs of personnel and/or part-time employment or redundancies of less than 10 persons.
OUTLOOK FOR 2015
In the current economic climate, forecasting net sales in the media sector and, in particular, media advertising spending involves still major uncertainties. Media advertising in Finland is expected to remain roughly at the previous year's level. Due to caution among consumers as well as competition in the media market, newspaper circulation income is forecast to decline slightly. Printing business volumes have shrunk in Finland and the trend is expected to continue in 2015.
Group net sales and operating profit from Ilkka-Yhtymä's own operations, excluding the share of Alma Media's and other associated companies' results, are expected to remain roughly the same as in 2014.
The associated company Alma Media Corporation (Group ownership 29.79%) will have a significant impact on Group operating profit and profit.
Annual Report 2014
FINANCIAL STATEMENTS
Financial Statements for 2014
Consolidated Income Statement, IFRS
| EUR 1,000 | NOTE | 1.1.-31.12.2014 | 1.1.-31.12.2013 |
|---|---|---|---|
| NET SALES | 1 | 41 802 | 44 893 |
| Change in inventories of finished and unfinished products | -3 | 6 | |
| Other operating income | 2 | 454 | 392 |
| Materias and services | 3 | -13 379 | -14 484 |
| Employee benefits | 4 | -16 782 | -17 020 |
| Depreciation | 5 | -1 856 | -2 078 |
| Other operating costs | 6 | -5 302 | -5 711 |
| Share of associated companies' results *) | 12 | 4 318 | -22 630 |
| OPERATING PROFIT/LOSS | 9 251 | -16 631 | |
| Financial income and expenses | 7 | 883 | -347 |
| PROFIT/LOSS BEFORE TAXES | 10 133 | -16 978 | |
| Income tax | 8 | -1 063 | -1 199 |
| PROFIT/LOSS FOR THE FINANCIAL PERIOD | 9 070 | -18 178 | |
| Earnings per share, undiluted (EUR) **) | 0.35 | -0.71 | |
| The undiluted share average **) | 25 665 208 | 25 665 208 |
) 2013: Includes the EUR 27 million non-recurring write-down on the holding in the associated company Alma Media Corporation.
*) There are no factors diluting the figure.
Consolidated Statement of Comprehensive Income
| EUR 1,000 | 1.1.-31.12.2014 | 1.1.-31.12.2013 |
|---|---|---|
| PROFIT/LOSS FOR THE PERIOD UNDER REVIEW | 9 070 | -18 178 |
| Other comprehensive income: | ||
| Items that may be reclassified subsequently to profit or loss: | ||
| Available-for-sale assets | ||
| Measured at fair value | -24 | 2 |
| Transferred to the income statement | 126 | |
| Share of associated companies' other comprehensive income | -173 | -342 |
| Income tax related to components of other comprehensive income | -20 | 11 |
| Other comprehensive income, net of tax | -91 | -328 |
| Total comprehensive income for the period | 8 979 | -18 506 |
Annual Report 2014
FINANCIAL STATEMENTS
Consolidated Balance Sheet, IFRS
| EUR 1,000 | NOTE | 31.12.2014 | 31.12.2013 |
|---|---|---|---|
| ASSETS | |||
| NON-CURRENT ASSETS | |||
| Intangible assets | 9 | 629 | 789 |
| Goodwill | 9 | 314 | 314 |
| Investment properties | 11 | 147 | 182 |
| Property, plant and equipment | 10 | 10 230 | 11 459 |
| Shares in associated companies | 12 | 105 310 | 103 492 |
| Available-for-sale financial assets | 13 | 2 953 | 10 668 |
| Non-current trade and other receivables | 14 | 567 | |
| Other tangible assets | 214 | 214 | |
| Non-current assets | 120 364 | 127 118 | |
| CURRENT ASSETS | |||
| Inventories | 15 | 523 | 483 |
| Trade and other receivables | 16 | 2 876 | 2 866 |
| Income tax assets | 150 | 96 | |
| Financial assets at fair value through profit or loss | 17 | 1 089 | 1 259 |
| Cash and cash equivalents | 18 | 5 534 | 1 980 |
| Current assets | 10 172 | 6 684 | |
| ASSETS | 130 536 | 133 802 | |
| SHAREHOLDERS' EQUITY AND LIABILITIES | |||
| SHAREHOLDERS' EQUITY | |||
| Share capital | 6 416 | 6 416 | |
| Invested unrestricted equity fund and other reserves | 48 716 | 48 635 | |
| Retained earnings | 9 371 | 3 040 | |
| Shareholders' equity | 19 | 64 503 | 58 091 |
| NON-CURRENT LIABILITIES | |||
| Deferred tax liability | 20 | 178 | 216 |
| Non-current interest-bearing liabilities | 21 | 54 549 | 60 432 |
| Non-current interest-free liabilities | 75 | 88 | |
| Non-current liabilities | 54 801 | 60 736 | |
| CURRENT LIABILITIES | |||
| Current interest-bearing liabilities | 21 | 2 387 | 5 947 |
| Accounts payable and other payables | 22 | 8 340 | 8 768 |
| Income tax liability | 504 | 260 | |
| Current liabilities | 11 232 | 14 975 | |
| SHAREHOLDERS' EQUITY AND LIABILITIES | 130 536 | 133 802 |
IFRS=International Financial Reporting Standards
Annual Report 2014 | 37
FINANCIAL STATEMENTS
Consolidated Cash Flow Statement, IFRS
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| CASH FLOW FROM OPERATIONS | ||
| Profit/loss for the financial period | 9 070 | -18 178 |
| Adjustments | -2 334 | 26 229 |
| Change in working capital | -486 | 408 |
| Cash flow from operations before financial items and taxes | 6 250 | 8 459 |
| Interests paid | -1 649 | -1 749 |
| Interests received | 31 | 35 |
| Dividends received | 55 | 2 344 |
| Other financial items | -45 | 333 |
| Direct taxes paid | -932 | -920 |
| Cash flow from operations | 3 710 | 8 502 |
| CASH FLOW FROM INVESTMENTS | ||
| Investments in tangible and intangible assets, net | -352 | -1 398 |
| Capital repayment received | 2 249 | |
| Other investments | -29 | -18 |
| Proceeds from sale of other investments | 10 056 | 138 |
| Granted loans | -567 | |
| Dividends received from investments | 484 | 528 |
| Cash flow from investments | 11 841 | -750 |
| Cash flow before financing items | 15 551 | 7 753 |
| CASH FLOW FROM FINANCING | ||
| Change in current loans | -3 561 | -4 217 |
| Change in non-current loans | -5 889 | |
| Dividends paid and other profit distribution | -2 548 | -3 818 |
| Cash flow from financing | -11 998 | -8 035 |
| Increase (+) or decrease (-) in financial assets | 3 553 | -282 |
| LIQUID ASSETS AT THE BEGINNING OF THE FINANCIAL PERIOD | 1 980 | 2 263 |
| LIQUID ASSETS AT THE END OF THE FINANCIAL PERIOD | 5 534 | 1 980 |
| NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT: | ||
| ADJUSTMENTS TO PROFIT/LOSS FOR THE PERIOD | ||
| Depreciation | 1 856 | 2 078 |
| Sales gains (-) and losses (+) on non-current assets | -52 | -26 |
| Share of profit (-) or loss (+) of associated companies | -4 318 | 22 630 |
| Unrealised fair-value gains (-) or losses (+) | 271 | -526 |
| Financial income and expenses | -1 154 | 873 |
| Income taxes | 1 063 | 1 199 |
| Adjustments to profit/loss for the period total | -2 334 | 26 229 |
| CHANGE IN WORKING CAPITAL | ||
| Increase (-) /decrease (+) in inventories | -40 | 164 |
| Increase (-) /decrease (+) in current interest-free operating receivables | 12 | 67 |
| Increase (+) /decrease (-) in current interest-free liabilities | -459 | 177 |
| Change in working capital total | -486 | 408 |
Annual Report 2014
FINANCIAL STATEMENTS
Changes in Consolidated Shareholders' Equity
| EUR 1,000 | Share capital | Fair value reserve | Invested unrestricted equity fund | Other reserves | Retained earnings | Total |
|---|---|---|---|---|---|---|
| CHANGE IN SHAREHOLDERS' EQUITY 1-12/2013 | ||||||
| SHAREHOLDERS' EQUITY 1.1. | 6 416 | 99 | 48 498 | 24 | 25 529 | 80 567 |
| Other change in shareholders' equity | -53 | -53 | ||||
| Comprehensive income for the period | 14 | -18 519 | -18 506 | |||
| Dividend distribution | -3 850 | -3 850 | ||||
| Share of associated company changes | -68 | -68 | ||||
| SHAREHOLDERS' EQUITY TOTAL 31.12.2013 | 6 416 | 113 | 48 498 | 24 | 3 040 | 58 091 |
| EUR 1,000 | Share capital | Fair value reserve | Invested unrestricted equity fund | Other reserves | Retained earnings | Total |
| --- | --- | --- | --- | --- | --- | --- |
| CHANGE IN SHAREHOLDERS' EQUITY 1-12/2014 | ||||||
| SHAREHOLDERS' EQUITY 1.1. | 6 416 | 113 | 48 498 | 24 | 3 040 | 58 091 |
| Comprehensive income for the period | 82 | 8 897 | 8 979 | |||
| Dividend distribution | -2 567 | -2 567 | ||||
| SHAREHOLDERS' EQUITY TOTAL 31.12.2014 | 6 416 | 194 | 48 498 | 24 | 9 371 | 64 503 |
Annual Report 2014 | 39
FINANCIAL STATEMENTS
Notes to the Consolidated Financial Statements
KEY FACTS ON THE COMPANY
Ilkka-Yhtymä Group is a media group which publishes the provincial newspapers Ilkka and Pohjalainen, and several local newspapers and two free sheets. In addition, the Group has a printing business. The Group comprises the parent company Ilkka-Yhtymä Oyj and the subsidiaries I-Mediat Oy, I-print Oy, Kiinteistö Oy Seinäjoen Koulukatu 10, Seinäjoen Kassatalo Osakeyhtiö and Pohjalaismediat Oy.
The Group's parent company Ilkka-Yhtymä Oyj is a Finnish public limited company domiciled in Seinäjoki, and its registered address is Koulukatu 10, 60100 Seinäjoki. Ilkka-Yhtymä Oyj's shares are listed on the NASDAQ OMX Helsinki List.
A copy of the consolidated financial statements is available from the website www.ilkka-yhtyma.fi or from the head office of the Group's parent company.
Ilkka-Yhtymä Oyj's Board of Directors approved the financial statements for publication at its meeting on 16 February 2015. According to the Finnish Companies Act, shareholders have the opportunity to accept or reject the financial statements at the General Meeting held after their publication. The General Meeting may also decide to revise the financial statements.
ACCOUNTING PRINCIPLES USED IN THE FINANCIAL STATEMENTS
ACCOUNTING POLICY
The consolidated financial statements were prepared in accordance with the recognition and measurement principles of the International Financial Reporting Standards (IFRS) applicable within the EU, to comply with the IAS and IFRS standards and SIC and IFRIC interpretations in effect on 31 December 2014.
The consolidated financial statements have been prepared under the historical cost convention, except for available-for-sales financial assets at fair value and financial assets stated at fair value through profit or loss. The financial statements are presented in thousands of euros.
Since 1 January 2014, the Group has complied with the following new or updated standards and interpretations:
- IFRS 10 Consolidated Financial Statements (effective for annual periods beginning on or after 1 January 2014). In line with existing principles, the standard establishes control as the key factor for determining whether an entity is consolidated or not. In addition, the standard provides additional guidelines for defining control in situations where it is difficult to assess. The revision has no impact on the financial statements.
- IFRS 11 Joint Arrangements (effective for annual periods beginning on or after 1 January 2014). In accounting for joint arrangements, the standard emphasises the rights and obligations arising from the arrangements rather than their legal form (as do the current regulations). In addition, the standard requires joint ventures to be accounted for using the equity method and prohibits the use of proportionate consolidation. The revision has no impact on the financial statements.
- IFRS 12 Disclosure of Interests in Other Entities (effective for annual periods beginning on or after 1 January 2014). The standard brings together all existing disclosure requirements related to interests in other entities, including associates, joint arrangements, special purpose entities and other, off-balance-sheet entities. The standard increased the number of disclosures.
- Amendment to IAS 32 Financial Instruments: Presentation (effective for annual periods beginning on or after
Annual Report 2014
FINANCIAL STATEMENTS
1 January 2014). The amendment clarifies the requirements for offsetting financial assets and liabilities, and provides additional application guidance. The amendment has no material impact on the consolidated financial statements.
The IASB has released the following new or revised standards and interpretations that may have a future impact on the Group's financial statements. The Group will apply these standards and interpretations, starting from their respective effective dates or, if an effective date is not the first day of a financial year, from the beginning of the financial year following the effective date.
-
IFRS 9 Financial Instruments (estimated effective date 1 January 2018). IFRS 9 is the first phase of a larger project aimed at replacing IAS 39 with a new standard. Financial assets are divided into two main classifications: those measured at amortised cost and those measured at fair value. The classification depends on the entity's business model and the contractual cash flow characteristics. The guidelines for impairment and hedge accounting contained in IAS 39 will remain effective. According to the new standard, the recognition and measurement of financial liabilities should remain unchanged, with the exception of financial liabilities, to which the fair value option is applied. The standard has not yet been endorsed by the w EU. Our view is that the standard will have no material impact on the consolidated financial statements.
-
IFRS 15 Revenue from Contracts with Customers (effective for annual periods beginning on or after 1 January 2017). The new standard replaces the current IAS 11 and IAS 18 standards and the related interpretations. The standard includes a five-step model for revenue recognition. Revenue is recognised when control of the goods or services sold is passed to the customer. The revenue recognition model contains much more detailed guidelines than the current standards IAS 11 and IAS 18. Disclosure requirements will also be significantly expanded. The standard has not yet been endorsed by the EU. The Group is in the process of estimating the possible impact of the standard on the consolidated financial statements.
ACCOUNTING POLICIES: THE CONSOLIDATED FINANCIAL STATEMENTS
SUBSIDIARIES
Subsidiaries refer to companies in which the Group holds a controlling interest. Said controlling interest arises from the Group owning over half of the subsidiary's votes, or exercising power in some other fashion. The controlling interest implies that the Group has power to govern the entity's financial and operating policies for the purpose of profiting from its operations.
Mutual shareholding between Group companies has been eliminated using the acquisition cost method. All Intra-Group transactions, receivables, liabilities, margins and distribution of profit have been eliminated in the preparation of the consolidated financial statements.
ASSOCIATED COMPANIES
Associated companies are companies over which the Group exercises significant influence. Significant influence originates when the Group owns over 20% of the associated company's votes, or the Group has a significant degree of influence over the company through other means, but has no controlling interest. Associated companies are consolidated in the financial statements using the equity method. If the Group's share of the losses of the associated company exceeds the carrying amount, they will not be consolidated unless the Group has made a commitment to fulfil the liabilities of the associated company in question. An investment in an associated company contains the goodwill generated by the acquisition.
Any impairment of Ilkka-Yhtymä's holding in associated companies is monitored in accordance with the IAS 28 Investments in Associates standard. Should any signs of impairment be detected, the holding's book value will be tested by comparing it to the recoverable amount from the holding, which is the value in use, or fair value excluding expenditure from the sale, whichever is the higher. Should such testing indicate impairment, this will be stated through profit or loss at the time of reporting in question. Should this impairment later reverse, the previously stated loss will be restored through profit or loss. With regard to the holding in Alma Media, factors affecting the assessment of signs of impairment and implementation of testing include financial profit-making capacity, changes in the market environment, dividend policy, and share price development.
In Group reporting, the share of associated companies' results is included in operating profit, while dividend income is included in cash flow from operations in the cash flow statement. The associated companies are closely related to the Group's publishing business, and, acting in its role as the owner, the Group participates in the development of their operations.
FOREIGN CURRENCY ITEMS
The consolidated financial statements are presented in euros, which is the parent company's operating and reporting currency.
Monetary items denominated in foreign currencies (financial assets and liabili
Annual Report 2014 | 41
FINANCIAL STATEMENTS
ties) were translated into euros using the European Central Bank's average rate quoted on the balance sheet date. Non-monetary items and transactions in foreign currencies were translated into euros using the exchange rate in effect on the date of the transaction. Any gains or losses resulting from transactions in foreign currencies, and from the translation of monetary items, are recognised in the income statement. Foreign exchange gains or losses associated with actual business operations are treated as adjusting entries for sales or purchases. Exchange rate gains and losses on foreign-currency investments and cash and cash equivalents are included in financial income and expenses.
INTANGIBLE ASSETS
Research and Development Expenses
The Group does not carry out a significant amount of research and development. Research and development expenses are charged to expenses in the income statement. On the balance sheet date, the Group's balance sheet did not include development expenses that could be capitalised.
Other Intangible Assets
Other intangible assets in the Group's balance sheet comprise software licenses, which are measured at cost and amortised on a straight-line basis over their expected economic lives. The period of amortisation is 3-10 years. The Group has no intangible assets with unlimited economic life.
Goodwill
Goodwill represents the excess of the acquisition cost over the Group's share of the net fair value of the identifiable assets, liabilities and contingent liabilities of the acquired business at the time of acquisition. Goodwill is allocated to cash-generating units and tested annually for impairment.
Goodwill is valued at cost less any impairment losses.
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment (PPE) are measured at cost less depreciation and any impairment losses.
When one part of PPE is treated as a separate asset, expenses associated with its renovation are capitalised. In other cases, major renovations are included in the assets' carrying amount only if it is probable that the Group will derive additional future economic benefits and that the carrying amount can be measured reliably. Other repair and maintenance expenses are charged to expenses as incurred.
The assets are depreciated over their expected economic life using the straight-line depreciation method. Land is not depreciated. The expected economic lives are as follows:
| Buildings | 20-40 years |
|---|---|
| Structures | 20 years |
| Machinery and equipment | 3-15 years |
The residual value and economic life of an asset are reviewed for each set of financial statements and, if necessary, adjusted to reflect changes in expected financial rewards.
INVESTMENT PROPERTY
Investment property refers to property which the Group holds for rental yields or capital appreciation. Investment property is measured at cost less depreciation and any impairment losses (IAS 40) and its fair value is presented in the notes to the financial statements. The fair value is based on an evaluation by an external professional property valuer, and corresponds to market prices paid for properties in the active market. The fair value measurement is performed on an annual basis.
INVENTORIES
Inventories are measured at the lower of cost or net realisable value. The cost is determined using the FIFO method. The cost of finished or unfinished goods is made up of raw materials, direct labour costs, other direct costs, as well as an appropriate portion of variable production overheads and part of fixed production overheads based on normal capacity. The net realisable value is the estimated sale price obtained in regular business, less the estimated costs of completing the good and selling costs.
LEASES
Group as lessee
Leases, in which the risks and rewards associated to the ownership of leased assets remain with the lessor, are classified as operating leases. Payments based on operating leases are recognised as expenses evenly over the lease term.
The Group has a finance lease that transfers the risks and rewards of ownership to the lessee. An asset acquired by means of a finance lease is recognised on the balance sheet at the date of commencement of the lease at the lower of fair value or the present value of minimum lease payments. An asset under a finance lease is depreciated over the shorter of its useful life or the lease term. Lease obligations are included in interest-bearing liabilities.
Group as lessor
Assets leased under operating leases are included in property, plant and equipment. They are depreciated over their economic lives in the same way as the property, plant and equipment used by the Group. Lease income is recognised in the income statement evenly over the lease term.
Annual Report 2014
FINANCIAL STATEMENTS
IMPAIRMENT
At each balance sheet date, the Group assesses whether there is any indication of an impaired asset. Should any such indication exist, the asset's recoverable amount must be calculated. In addition, the recoverable amount of goodwill is assessed on an annual basis, regardless of whether there are indications of impairment.
The impairment loss is recognised in the income statement if the carrying amount of the asset or the cash-generating unit exceeds the recoverable amount. The recoverable amount represents the net selling price of the asset, or a higher, cash-flow-based value in use. In determining the value in use, the net present values of future cash flows are discounted using discount rates which describe the Group's average pre-tax capital cost, adjusted by industry risk. The impairment loss is reversed if circumstances change and the recoverable amount of the asset has changed from the date when the impairment loss was recognised. The impairment loss is not be reversed beyond the value that the carrying amount of the asset would have been, had there been no impairment loss. The impairment loss of goodwill is not reversible.
EMPLOYEE BENEFITS
Pensions
The Group's major pension plan is the statutory pension insurance under the Finnish Employment Pension Scheme (TyEL), which is managed by pension insurance companies. This TyEL pension security is classified as a defined contribution plan. In addition, the Group has taken out certain supplementary group and individual pension plans with insurance companies. These supplementary pension insurance plans are considered defined contribution plans, since the company's payment obligation to the insurance companies is limited to the annually paid contribution and the company has not committed to accruing a pension security of a certain magnitude for the insured. Contributions into the defined contribution plan are recognised as expenses for the period during which the contributions are made.
INCOME TAXES
Tax expense in the income statement includes current tax (taxes based on the taxable profit for the financial year) and deferred tax. The tax based on the taxable profit is calculated using the tax rate currently in force. The amount of the tax for the period is adjusted by any taxes for earlier financial years.
Deferred tax assets and liabilities are calculated on all temporary differences between the carrying amount and taxable value. The greatest temporary differences result from appropriations and the fair value of financial instruments. Deferred taxes are calculated using the tax rates set by the balance sheet date. Deferred tax assets and liabilities are presented in net values in the balance sheet, whenever they concern the same tax recipient.
Deferred tax assets are recognised to the extent that it appears probable that future taxable profit will be available against which the temporary difference can be utilised.
The impact of a tax rate change is recognised in profit or loss.
REVENUE RECOGNITION PRINCIPLES
Payments in circulation sales are received in advance and their recognition is spread over the subscription period. An advertisement sale is recognised when the service has been rendered. Printing products are recognised when the significant risks and rewards related to the ownership of goods have been transferred to the buyer. In calculating net sales, sales revenue are adjusted by discounts granted, indirect taxes and exchange rate differences associated with sales.
Lease income, presented under other operating income, is recognised evenly over the lease term.
Dividends are recognised as revenue when shareholders have the right to receive a dividend payment.
FINANCIAL ASSETS AND LIABILITIES
The Group's financial assets are classified as financial assets recognised at fair value through profit or loss, loans and receivables, available-for-sale financial assets, and held-to-maturity investments. Classifying a financial asset is determined by the purpose for which the asset is purchased at time of its purchase. In the case of assets not recognised at their fair value through profit or loss, transaction costs are included in the original carrying value of the financial assets. All purchases and sales of financial assets are recognised on the date of their transaction.
Financial assets at fair value through profit or loss include held-for-trading assets. With respect to shares held for trading, the net values of any unrealised fair-value gains or losses, dividend income and any capital gains or losses are recognised under financial income and expenses in the income statement. Financial assets held for trading include listed shares which prices have been specified in the active market.
Held-to-maturity investments are non-derivative financial assets with fixed and determinable payments and fixed maturity, and which the Group has the positive intent and ability to hold to maturity. They are measured at amortised cost. The Group had no such items during the reporting period.
Annual Report 2014
FINANCIAL STATEMENTS
Loans and receivables are non-derivative assets with fixed and determinable payments, which are not publicly traded in the active market and which the company does not hold for trading. This category includes the Group's financial assets created by providing money, goods or services directly to the debtor. Initially recognised at cost and subsequently measured at amortised cost, they are included in current and non-current financial assets.
Available-for-sale financial assets are non-derivative assets which specifically belong to this category, or which are not classified under other financial asset categories. Assets within this category are carried at fair value subsequent to their initial recognition, and any changes in their fair value are recognised in the fair value reserve under shareholders' equity. Available-for-sale financial assets consist primarily of unlisted shares. Changes in fair value are transferred from equity to the income statement when the asset is disposed of or it has lost its value to the extent that an impairment loss must be recognised for the asset. Unlisted shares for which no reliable fair value was available are measured at cost.
Cash and cash equivalents comprise cash and bank receivables and other highly liquid investments with short maturity. Cash and cash equivalents include assets with a maximum maturity of three months from the date of purchase. Credit limits are included under current interest-bearing liabilities.
The Group's financial liabilities mainly comprise accounts payable and loans from financial institutions. Financial liabilities are initially measured at fair value, which is the monetary amount received less expenses directly incurring from the liability. After initial recognition, liabilities are carried at amortised cost. Financial liabilities include non-current and current liabilities, and can be either interest-bearing or non interest-bearing in nature.
IMPAIRMENTS OF FINANCIAL ASSETS
At every closing date, the Group evaluates on a case-by-case basis whether there is objective evidence indicating impairment in the value of either a single item or a group of financial assets. A substantial or long-term decline in the value of share investments below their acquisition cost indicates the impairment of available-for-sale shares. Factors that may trigger impairment include any financial difficulties experienced by the other party and any fall in market value substantially under the acquisition cost or lasting for more than 12 months. If there is evidence of impairment, the loss accumulated in the fair value reserve is transferred into the income statement.
MANAGEMENT JUDGEMENT IN APPLYING THE MOST SIGNIFICANT ACCOUNTING POLICIES AND OTHER KEY ASSUMPTIONS ABOUT FUTURE RISKS AND UNCERTAINTIES
Above, we have presented solutions based on the management's judgement and concerning the selection and application of accounting policies in the financial statements.
Preparing the financial statements requires the company's management to make estimates and assumptions concerning the future, but the actual results may differ from the estimates and assumptions which are based on historical experience and other reasonable assumptions. Furthermore, the application of accounting principles requires the use of judgment.
The Group's major assumptions about the future and the uncertainties concerning estimates on the balance sheet date that have a significant risk of causing a material adjustment to carrying amounts of assets and liabilities within the next financial year are factored in the assessment of the impairment of intangible and tangible assets and available-for-sale investments and shares in associated companies. Any indications of impairment are evaluated on a regular basis, as stated above in the description of accounting policies. The carrying amounts of tangible and intangible assets, available-for-sale financial assets and holdings in associated companies on the balance sheet date are presented in the notes to the financial statements, under Notes 9, 10, 12 and 13.
Annual Report 2014
FINANCIAL STATEMENTS
1. OPERATING SEGMENTS
The Group comprises three reportable segments. These operating segments are based on the Group's organisational structure and internal financial reporting. The Group's reportable segments consist of cross-media publishing and printing and the associated companies.
The publishing segment comprises the publishing company I-Mediat Oy. The Group publishes the provincial papers, Ilkka and Pohjalainen, five local papers (Jurvan Sanomat, Järviseutu, Komiat, Suupohjan Sanomat and Viiskunta) and two free sheets, Etelä-Pohjanmaa and Vaasan Ikkuna. Segment profit comprises circulation income and advertising income.
The printing segment comprises the printing house I-print Oy. The company's net sales are primarily made up of newspaper printing. In addition, its services include various printed materials, page-making and design, and digital printing and content design.
In the financial statements, associated companies are presented under their own segment. The associated companies included in our consolidated financial statements are Alma Media Corporation, Arena Partners Oy and Yrittävä Suupohja Oy. Our holding in Väli-Suomen Media Oy was sold in June 2014. The associated companies are closely related to the Group's publishing business, and, acting in its role as the owner, the Group participates in the development of their operations.
Within the Group, the profits of these segments represent the level of operating profit.
Segment assets and liabilities are business items used by the segment in its operations. Non-allocated items include Group services, securities trading, tax and financing items, and items shared by the company. Investments comprise material fixed assets and intangible assets, used over more than one financial year, as well as additions of available-for-sale shares and shares in associated companies. Pricing between the segments is market-based.
OPERATING SEGMENTS
| 2014 (EUR 1,000) | Publishing | Printing | Associated companies | Unallocated | Eliminations | Group total |
|---|---|---|---|---|---|---|
| INCOME STATEMENT FIGURES | ||||||
| External net sales | 36 330 | 5 472 | 41 802 | |||
| Internal net sales | 83 | 6 861 | 2 231 | -9 175 | ||
| Net sales | 36 413 | 12 333 | 2 231 | -9 175 | 41 802 | |
| Depreciation | -409 | -1 070 | -377 | -1 856 | ||
| Share of associated companies' results | 4 318 | 4 318 | ||||
| Operating profit/loss | 3 481 | 1 749 | 4 318 | -297 | 9 251 | |
| Financial income and expenses | 883 | 883 | ||||
| Income tax | -1 063 | -1 063 | ||||
| Profit/loss for the period | 9 070 | |||||
| ASSETS | ||||||
| Assets by segment | 8 826 | 8 674 | 113 036 | 130 536 | ||
| Shares in associated companies | 105 310 | 105 310 | ||||
| LIABILITIES | ||||||
| Liabilities by segment | 5 623 | 1 100 | 59 310 | 66 033 | ||
| INVESTMENTS | 181 | 85 | 198 | 464 | ||
| Products and services, external net sales | ||||||
| Circulation income | 19 074 | |||||
| Advertisement income | 17 162 | |||||
| Printing income | 5 472 | |||||
| Other income | 94 |
The divergence between the total net sales of the reportable segments and those of the Group is due to Group eliminations. The divergence between the total operating profit of the reportable segments and that of the Group is primarily due to the unallocated operating loss of the parent company functions.
Annual Report 2014 | 45
FINANCIAL STATEMENTS
| 2013 (EUR 1,000) | Publishing | Printing | Associated companies | Unallocated | Eliminations | Group total |
|---|---|---|---|---|---|---|
| INCOME STATEMENT FIGURES | ||||||
| External net sales | 38 098 | 6 795 | 44 893 | |||
| Internal net sales | 159 | 6 968 | 2 269 | -9 395 | ||
| Net sales | 38 257 | 13 763 | 2 269 | -9 395 | 44 893 | |
| Depreciation | -478 | -1 187 | -413 | -2 078 | ||
| Share of associated companies' results | 4 370 | 4 370 | ||||
| Impairment | -27 000 | -27 000 | ||||
| Operating profit/loss | 4 594 | 1 827 | -22 630 | -422 | -16 631 | |
| Financial income and expenses | -347 | -347 | ||||
| Income tax | -1 199 | -1 199 | ||||
| Profit/loss for the period | -18 178 | |||||
| ASSETS | ||||||
| Assets by segment | 9 252 | 8 788 | 115 762 | 133 802 | ||
| Shares in associated companies | 17 | 103 475 | 103 492 | |||
| LIABILITIES | ||||||
| Liabilities by segment | 6 325 | 1 538 | 67 849 | 75 711 | ||
| INVESTMENTS | 190 | 1 022 | 211 | 1 423 | ||
| Products and services, external net sales | ||||||
| Circulation income | 19 383 | |||||
| Advertising income | 18 621 | |||||
| Printing income | 6 795 | |||||
| Other income | 94 |
The divergence between the total net sales of the reportable segments and those of the Group is due to Group eliminations. The divergence between the total operating loss of the reportable segments and that of the Group is primarily due to the unallocated operating loss of the parent company functions.
GEOGRAPHICAL INFORMATION
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| NET SALES | ||
| Finland | 41 733 | 44 845 |
| Foreign countries | 69 | 47 |
| Total | 41 802 | 44 893 |
| NON-CURRENT ASSETS | ||
| Finland | 116 843 | 116 450 |
2. OTHER OPERATING INCOME
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Rent income from investment properties | 266 | 263 |
| Other rent income | 60 | 86 |
| Sales gains on property, plant and equipment | 52 | 26 |
| Other operating income | 76 | 18 |
| Total | 454 | 392 |
46 | Annual Report 2014
FINANCIAL STATEMENTS
- MATERIALS AND SERVICES
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Purchases during the financial period | 3 648 | 4 365 |
| Increase or decrease of stocks | -43 | 170 |
| Materials and supplies | 3 605 | 4 535 |
| External charges | 9 774 | 9 949 |
| Materials and services | 13 379 | 14 484 |
- EMPLOYEE BENEFITS
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Salaries and fees | 13 760 | 13 935 |
| Pension costs, defined contribution plans | 2 360 | 2 378 |
| Other personnel costs | 662 | 706 |
| Employee benefits | 16 782 | 17 020 |
PERSONNEL ON AVERAGE
| Publishing | 219 | 225 |
|---|---|---|
| Printing | 68 | 72 |
| Unallocated | 24 | 24 |
| Total | 311 | 321 |
Information on employee benefits covering Group management is presented in section 26.
- DEPRECIATION
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Intangible rights | 301 | 358 |
| Buildings and constructions | 442 | 529 |
| Investment properties | 36 | 50 |
| Machinery and equipment | 1 077 | 1 141 |
| Depreciation according to plan | 1 856 | 2 078 |
- OTHER OPERATING COSTS
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Rents | 97 | 113 |
| Costs for premises | 955 | 950 |
| Production machinery costs | 218 | 286 |
| Telecommunications, office and information technology cost | 1 534 | 1 611 |
| Sales and marketing costs | 1 262 | 1 311 |
| Other costs | 1 236 | 1 440 |
| Other operating costs total | 5 302 | 5 711 |
| AUDIT FEES | ||
| Statutory audit | 60 | 46 |
| Tax counselling | 2 | |
| Other fees | 14 | 51 |
| Total | 74 | 99 |
Annual Report 2014 | 47
FINANCIAL STATEMENTS
- FINANCIAL INCOME AND EXPENSES
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| FINANCIAL INCOME | ||
| Dividend yields on available-for-sale financial assets | 484 | 511 |
| Sales gains on available-for-sale financial assets | 2 152 | 63 |
| Net gains on held-for-trading financial assets | 22 | |
| Interest income from loans, receivables and bank accounts | 53 | 35 |
| Unrealised change in the market value of the interest rate swaps | 734 | |
| Other financial income | 108 | 77 |
| Financial income total | 2 797 | 1 442 |
| FINANCIAL EXPENSES | ||
| Sales loss on available-for-sale financial assets | -3 | |
| Net loss on held-for-trading financial assets | -130 | |
| Interest expenses on financial liabilities measured at amortised cost | -1 678 | -1 789 |
| Unrealised change in the market value of the interest rate swaps | -102 | |
| Financial expenses total | -1 914 | -1 789 |
| Financial income and expenses total | 883 | -347 |
- INCOME TAXES
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Income taxes on operations | 1 134 | 1 048 |
| Taxes on previous financial periods | -12 | |
| Change in deferred tax liabilities and assets | -59 | 152 |
| Income taxes | 1 063 | 1 199 |
| Reconciliation | ||
| Profit/loss before taxes | 10 133 | -16 978 |
| Tax calculated at parent company's tax rate | 2 027 | -4 160 |
| Tax expenses in income statement | -1 063 | -1 199 |
| Difference | 963 | -5 359 |
| Difference analysis (net) | ||
| Non-deductible expenses | -14 | -9 |
| Tax-exempt income | 107 | 145 |
| Share of associated companies' results | 864 | -5 544 |
| The impact of a tax rate change | 50 | |
| Taxes on previous financial periods | 12 | |
| Other items | -6 | |
| Difference analysis (net) total | 963 | -5 359 |
Annual Report 2014
FINANCIAL STATEMENTS
- INTANGIBLE ASSETS AND GOODWILL
| EUR 1,000 | Intangible rights | Other intangible assets | Advances paid | Goodwill | Total |
|---|---|---|---|---|---|
| INTANGIBLE ASSETS 2014 | |||||
| Acquisition cost 1.1. | 5 912 | 2 | 61 | 314 | 6 290 |
| Increase | 116 | 25 | 141 | ||
| Decrease | -686 | -686 | |||
| Transfers between items | 45 | -45 | |||
| Acquisition cost 31.12. | 5 387 | 2 | 41 | 314 | 5 745 |
| Accumulated depreciation 1.1. | -5 186 | -5 186 | |||
| Accumulated depreciation of decrease and transfers | 686 | 686 | |||
| Depreciation for the financial period | -301 | -301 | |||
| Accumulated depreciation 31.12. | -4 801 | -4 801 | |||
| BOOK VALUE 31.12.2014 | 586 | 2 | 41 | 314 | 943 |
| EUR 1,000 | Intangible rights | Other intangible assets | Advances paid | Goodwill | Total |
| INTANGIBLE ASSETS 2013 | |||||
| Acquisition cost 1.1. | 5 734 | 2 | 100 | 314 | 6 150 |
| Increase | 67 | 72 | 139 | ||
| Transfers between items | 111 | -111 | |||
| Acquisition cost 31.12. | 5 912 | 2 | 61 | 314 | 6 290 |
| Accumulated depreciation 1.1. | -4 828 | -4 828 | |||
| Depreciation for the financial period | -358 | -358 | |||
| Accumulated depreciation 31.12. | -5 186 | -5 186 | |||
| BOOK VALUE 31.12.2013 | 726 | 2 | 61 | 314 | 1 103 |
Goodwill of EUR 314 thousand has been allocated to the cash-generating unit of the Komiat weekly paper, which is part of the Publishing segment. In impairment testing, recoverable amounts were defined based on the value in use. Cash flow estimates are based on the next financial year's budget approved by the management, after which the growth factor applied is 0%. The discount rate used is 8.5%. Any reasonably possible change in the key assumptions used in testing would not cause the carrying amounts to exceed their recoverable amounts.
Annual Report 2014 | 49
FINANCIAL STATEMENTS
- PROPERTY, PLANT AND EQUIPMENT
| EUR 1,000 | Land areas | Buildings and constructions | Machinery and equipment | Advances paid and work in progress | Total |
|---|---|---|---|---|---|
| TANGIBLE ASSETS 2014 | |||||
| Acquisition cost 1.1. | 891 | 19 458 | 40 602 | 60 951 | |
| Increase | 7 | 247 | 40 | 294 | |
| Decrease | -98 | -98 | |||
| Acquisition cost 31.12. | 891 | 19 465 | 40 751 | 40 | 61 147 |
| Accumulated depreciation 1.1. | -13 111 | -36 381 | -49 493 | ||
| Accumulated depreciation of decrease and transfers | 94 | 94 | |||
| Depreciation for the financial period | -442 | -1 077 | -1 519 | ||
| Accumulated depreciation 31.12. | -13 553 | -37 364 | -50 918 | ||
| BOOK VALUE 31.12.2014 | 891 | 5 911 | 3 387 | 40 | 10 230 |
| EUR 1,000 | Land areas | Buildings and constructions | Machinery and equipment | Advances paid and work in progress | Total |
| --- | --- | --- | --- | --- | --- |
| TANGIBLE ASSETS 2013 | |||||
| Acquisition cost 1.1. | 891 | 19 253 | 39 168 | 484 | 59 796 |
| Increase | 12 | 553 | 701 | 1 266 | |
| Decrease | -111 | -111 | |||
| Transfers between items | 192 | 992 | -1 185 | ||
| Acquisition cost 31.12. | 891 | 19 458 | 40 602 | 60 951 | |
| Accumulated depreciation 1.1. | -12 582 | -35 352 | -47 934 | ||
| Accumulated depreciation of decrease and transfers | 111 | 111 | |||
| Depreciation for the financial period | -529 | -1 141 | -1 670 | ||
| Accumulated depreciation 31.12. | -13 111 | -36 381 | -49 493 | ||
| BOOK VALUE 31.12.2013 | 891 | 6 346 | 4 221 | 11 459 |
The balance sheet value of production machinery and equipment belonging to the Group's property, plant and equipment was EUR 3,067 thousand on 31 Dec 2014 (EUR 3,827 thousand on 31 Dec 2013).
- INVESTMENT PROPERTIES
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| INVESTMENT PROPERTIES | ||
| Acquisition cost 1.1. | 2 042 | 2 042 |
| Acquisition cost 31.12. | 2 042 | 2 042 |
| Accumulated depreciation 1.1. | -1 860 | -1 810 |
| Depreciation for the financial period | -36 | -50 |
| Accumulated depreciation 31.12. | -1 895 | -1 860 |
| BOOK VALUE 31.12. | 147 | 182 |
Annual Report 2014
FINANCIAL STATEMENTS
Investment property is measured at cost less depreciation and any impairment losses (IAS 40) and its fair value is presented in the notes to the financial statements. The Group has categorised its investment property to be within Level 3 of the fair value hierarchy. Fair value is based on a detailed appraisal report prepared by an external authorised property valuer.
For one piece of investment property, the property valuer has used the sales comparison approach and the income capitalisation approach as measurement methods. The value is made up of the value of the permitted building volume, from which the building demolition costs and the compensation specified in the land use agreement are deducted, and the rent of the building until the date of demolition, from which the rent of land and property tax are deducted. The investment property in question is located in the Jouppi area in Seinäjoki. The local detailed plan for the area has been altered. This alteration will change the current industrial block area in the old local detailed plan, into part of a commercial building block area allowing a large retail unit to be located in the area (KM block area). If Ilkka-Yhtymä Oyj sells its property, it is required by the land use agreement to pay development compensation of EUR 750,000 from the sale price to the City of Seinäjoki, in accordance with section 91 a of the Land Use and Building Act. An appeal made against the amendment to the local detailed plan was rejected by the Supreme Administrative Court on 1 November 2011, and the local detailed plan became effective on 9 November 2011.
For the other piece of investment property, the property valuer has used the income capitalisation approach as the measurement method. The yield value of the property has been determined using the discounted cash flow method for a period of 10 years. This is the sum of the present value of accumulated cash flows over 10 years and the present value of the future value of the premises. The local detailed plan for the area has been altered. This alteration raised the plot ratio (permitted building volume relative to the surface area of the plot) specified in the old plan from 1.3 to 4.0. The local detailed plan took effect on 8 October 2014, and a land use agreement was concluded with the City of Seinäjoki regarding the new plan. According to the agreement, the property owner is obliged to pay compensation to the City of Seinäjoki, as specified in section 91 a of the Land Use and Building Act, for land use development in the event of additional construction or the sale of the property. The maximum compensation is EUR 207,000.
The fair value of investment properties was EUR 2.8 million in 2014 (EUR 2.8 million in 2013).
12. SHARES IN ASSOCIATED COMPANIES
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| SHARES IN ASSOCIATED COMPANIES | ||
| At the beginning of the financial period | 103 492 | 128 796 |
| Decrease | -34 | |
| Group adjustment related to a divestment | -29 | |
| Share of associated companies' results | 4 318 | 4 370 |
| Impairment | -27 000 | |
| Capital repayment received | -2 249 | |
| Dividends received | -16 | -2 265 |
| Share of associated companies' other comprehensive income | -173 | -342 |
| Share of associated company changes | -68 | |
| At the end of the financial period | 105 310 | 103 492 |
On the basis of impairment testing, Ilkka-Yhtymä Group recorded in its 2013 consolidated financial statements a EUR 27 million write-down on the holding in the associated company Alma Media. This write-down, recorded under associated companies, had no impact on cash flow. With respect to the holding in Alma Media, the Group's calculations build on estimates made by management on the basis of public information and on public forecasts of Alma Media's earning power conducted by analysts following the company. The post-tax weighted average cost of capital (WACC) used for calculating the value in use was around 9%.
On the balance sheet date of 31 December 2014, the balance sheet value of the holding in the associated company Alma Media Corporation was EUR 104.5 million (on 31 Dec. 2013, EUR 102.7 million following the write-down) and the shares' market value came to EUR 61.8 million (EUR 67.2 million on 31 Dec. 2013). Of the holdings in associated companies, EUR 50.5 million (market value) were used as collateral for loans on 31 December 2014 (EUR 49.7 million on 31 Dec. 2013).
Annual Report 2014 | 51
FINANCIAL STATEMENTS
INFORMATION ON THE GROUP'S ASSOCIATED COMPANIES:
| 2013 (EUR 1,000) | Domicile | Group's share of profit/ loss | Group's share of other comprehensive income | Balance sheet value on the consolidated balance sheet | Group holding % |
|---|---|---|---|---|---|
| Alma Media Corporation 1) | Helsinki | -22 319 | -342 | 102 674 | 29.792 |
| Arena Partners Oy | Kuopio | -331 | 702 | 37.823 | |
| Väli-Suomen Media Oy | Jyväskylä | 1 | 43 | 40.00 | |
| Yrittävä Suupohja Oy | Kauhajoki | 19 | 72 | 38.46 | |
| Total | -22 630 | -342 | 103 492 | ||
| 2014 (EUR 1,000) | Domicile | Group's share of profit/ loss | Group's share of other comprehensive income | Balance sheet value on the consolidated balance sheet | Group holding % |
| --- | --- | --- | --- | --- | --- |
| Alma Media Corporation | Helsinki | 4 232 | -173 | 104 485 | 29.792 |
| Arena Partners Oy | Kuopio | 50 | 751 | 37.823 | |
| Väli-Suomen Media Oy 2) | Jyväskylä | 19 | |||
| Yrittävä Suupohja Oy | Kauhajoki | 17 | 74 | 38.46 | |
| Total | 4 318 | -173 | 105 310 |
1) Group's share of profit/loss includes the EUR 27 million write-down.
2) Our holding in Väli-Suomen Media Oy was sold in June 2014.
SUMMARY OF FINANCIAL INFORMATION FOR MATERIAL ASSOCIATED COMPANIES:
| EUR 1,000 | Alma Media Corporation | Arena Partners Oy | ||
|---|---|---|---|---|
| 2014 | 2013 | 2014 | 2013 | |
| Current assets | 41 162 | 42 744 | 1 707 | 2 300 |
| Non-current assets | 214 976 | 227 934 | 15 147 | 15 618 |
| Current liabilities | 71 608 | 102 643 | 887 | 3 172 |
| Non-current liabilities | 80 861 | 79 696 | 13 235 | 12 185 |
| Net sales | 295 395 | 300 242 | 3 430 | 3 305 |
| Profit/loss for the financial period 3) | 14 205 | 15 045 | 131 | -875 |
| Other comprehensive income 4) | -580 | -3 224 | ||
| Dividends and capital repayments received from associated company during the period | 2 249 | 2 249 | ||
| Reconciliation between the associated company's financial information and the balance sheet value recognised by the Group: | ||||
| Associated company's net assets 3) | 88 494 | 86 006 | 2 524 | 2 393 |
| Group holding % | 29,792 | 29,792 | 37,823 | 37,823 |
| Group's share of net assets | 26 364 | 25 623 | 955 | 905 |
| Goodwill | 129 258 | 129 258 | -204 | -204 |
| Other adjustments 5) | -51 138 | -52 207 | ||
| Associated companies' balance sheet value on the consolidated balance sheet | 104 485 | 102 674 | 751 | 702 |
3) Proportion attributable to the owners of the parent company.
4) Alma Media Corporation has amended the comparative data for 2013 owing to changes in exchange rates affecting goodwill. As a result, translation differences in Alma Media Group's equity decreased by EUR 2.1 million. The figure for the comparative year 2013 for Alma Media Corporation is presented in accordance with this amendment.
5) Other adjustments includes EUR 49 million of impairment.
Annual Report 2014
FINANCIAL STATEMENTS
13. AVAILABLE-FOR-SALE FINANCIAL ASSETS
Available-for-sale financial assets include unlisted shares. Unlisted shares are measured at fair value in cases where reliable fair value was available. Fair value has been defined based on market prices of sales of corresponding shares. Fair value changes are transferred from equity to the consolidated income statement, when the financial asset is sold or when its value has impaired in a manner requiring the recognition of an impairment loss.
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Unlisted shares | 2 953 | 10 668 |
| Available-for-sale financial assets total | 2 953 | 10 668 |
Holdings in unlisted shares primarily comprised holdings in Keski-Pohjanmaan Kirjapaino and real estate companies. In the financial year 2014, Ilkka-Yhtymä Group sold all of its Anvia Oyj shares.
14. NON-CURRENT TRADE AND OTHER RECEIVABLES
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Non-current loan receivables from associated companies (loans and receivables) | 567 | |
| Non-current trade and other receivables | 567 |
Non-current trade and other receivables consist of a subordinated loan granted to an associated company that is subject to sections 12(1) and 12(2) of the Limited Liability Companies Act. The subordinated loan is recorded at book value on the balance sheet.
15. INVENTORIES
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Materials and supplies | 493 | 449 |
| Work in progress | 30 | 34 |
| Inventories | 523 | 483 |
16. TRADE AND OTHER RECEIVABLES
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Current receivables from associated companies (loans and receivables) | 53 | 48 |
| Trade receivables (loans and receivables) * | 2 346 | 2 447 |
| Current accrued income and deferred expenses | 478 | 371 |
| Trade and other receivables | 2 876 | 2 866 |
| Substantial accrued income items | ||
| Accruals of personnel expenses | 158 | 58 |
| Other items | 319 | 313 |
| Total | 478 | 371 |
| *) Trade receivables according to age | ||
| Undue | 2 046 | 2 043 |
| Overdue | ||
| under 30 days | 169 | 300 |
| 30-60 days | 17 | 23 |
| over 60 days | 114 | 82 |
| Total | 2 346 | 2 447 |
During the financial year, the Group entered credit losses of EUR 56 thousand for trade receivables (in 2013, EUR 8 thousand).
Annual Report 2014 | 53
FINANCIAL STATEMENTS
- FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Shares and holdings (held for trading) | 1 089 | 1 259 |
| Financial assets at fair value through profit or loss | 1 089 | 1 259 |
Financial assets recognised at fair value through profit or loss include investments held for trading, which are listed shares, which prices have been specified in the active market.
- CASH AND CASH EQUIVALENTS
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Liquid assets in consolidated balance sheet and cash flow statement | ||
| Cash and cash equivalents | 5 534 | 1 980 |
| Cash and cash equivalents | 5 534 | 1 980 |
- NOTES COVERING SHAREHOLDERS' EQUITY
| Series I | Number of shares | Share capital (EUR 1,000) |
|---|---|---|
| 31.12.2012/ 31.12.2013 | 4 304 061 | 1 076 |
| 31.12.2014 | 4 304 061 | 1 076 |
| Series II | Number of shares | Share capital (EUR 1,000) |
| 31.12.2012/ 31.12.2013 | 21 361 147 | 5 340 |
| 31.12.2014 | 21 361 147 | 5 340 |
| Series I and II total | Number of shares | Share capital (EUR 1,000) |
| 31.12.2012/ 31.12.2013 | 25 665 208 | 6 416 |
| 31.12.2014 | 25 665 208 | 6 416 |
One Series I share entitles its holder to twenty (20) votes at the shareholders' meeting, while one Series II share one (1) vote. Other information on equity is presented in Shares and Shareholders on page 73.
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| INVESTED UNRESTRICTED EQUITY FUND AND OTHER RESERVES | ||
| Fair value reserve | 194 | 113 |
| Invested unrestricted equity fund | 48 498 | 48 498 |
| Loan repayment reserve | 24 | 24 |
| Invested unrestricted equity fund and other reserves | 48 716 | 48 635 |
Invested unrestricted equity fund
The invested unrestricted equity fund includes other equity related investments and share subscription prices to the extent that they are not, expressly designated for recording under share capital.
Other reserves:
Fair value reserve
The fair value reserve contains changes in the fair values of available-for-sale financial assets.
Loan repayment reserve
The loan repayment reserve consists of the equity reserve of a real estate company that belongs to the Group.
Dividends
Following the balance sheet date, the Board of Directors proposed that a dividend of EUR 0.10 per share be distributed.
Annual Report 2014
FINANCIAL STATEMENTS
20. DEFERRED TAX ASSETS AND LIABILITIES
DEFERRED TAX IN 2014:
| EUR 1,000 | 1.1.2014 | Recognised through profit and loss | Recognised in equity | 31.12.2014 |
|---|---|---|---|---|
| Deferred tax assets | ||||
| Derivative financial instruments | 340 | 20 | 361 | |
| Total | 340 | 20 | 361 | |
| Deferred tax liabilities | ||||
| Depreciation difference and voluntary provisions | 479 | -48 | 431 | |
| Other accrual differences | 25 | 10 | 35 | |
| Available-for-sale financial assets | 52 | 20 | 73 | |
| Total | 556 | -38 | 20 | 539 |
| Net deferred tax liabilities in balance sheet | 216 | -59 | 20 | 178 |
DEFERRED TAX IN 2013:
| EUR 1,000 | 1.1.2013 | Recognised through profit and loss | Recognised in equity | Other change | 31.12.2013 |
|---|---|---|---|---|---|
| Deferred tax assets | |||||
| Derivative financial instruments | 597 | -256 | 340 | ||
| Total | 597 | -256 | 340 | ||
| Deferred tax liabilities | |||||
| Depreciation difference and voluntary provisions | 540 | -114 | 53 | 479 | |
| Other accrual differences | 16 | 9 | 25 | ||
| Available-for-sale financial assets | 64 | -11 | 52 | ||
| Total | 620 | -105 | -11 | 53 | 556 |
| Net deferred tax liabilities in balance sheet | 23 | 152 | -11 | 53 | 216 |
The Group has EUR 126 thousand in impairment losses, for which it has not recognised deferred tax assets because it is not probable that these impairment losses can be utilised in taxation in the future.
21. INTEREST-BEARING LIABILITIES
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| NON-CURRENT INTEREST-BEARING LIABILITIES | ||
| Loans from financial institutions (financial liabilities measured at amortised cost) | 34 365 | 40 253 |
| Convertible bond (financial liabilities measured at amortised cost) | 19 967 | 19 927 |
| Finance lease liabilities (financial liabilities measured at amortised cost) | 217 | 252 |
| Non-current interest-bearing liabilities | 54 549 | 60 432 |
| CURRENT INTEREST-BEARING LIABILITIES | ||
| Loans from financial institutions (financial liabilities measured at amortised cost) | 2 353 | 5 914 |
| Finance lease liabilities (financial liabilities measured at amortised cost) | 34 | 33 |
| Current interest-bearing liabilities | 2 387 | 5 947 |
Annual Report 2014 | 55
FINANCIAL STATEMENTS
The Group has both fixed-rate and floating-rate interest-bearing loans. The Group initiated hedging against interest-rate risk towards the end of the financial year 2010. This hedging strategy is intended to ensure that approximately 50% of interest-bearing liabilities are tied to a fixed rate. In order to attain this target, interest rate swaps have been used. The hedging measures included, 53% of loans had a fixed rate on the balance sheet date, while 47% had a floating rate. The average interest rate for loans on 31 December 2014 came to 2.50% (2.53% on 31 Dec. 2013).
On the balance sheet date of 31 December 2014, credit limits totalled EUR 13 million, none of which had been drawn by 31 December 2014. On 31 December 2013, credit limits totalled EUR 13 million, none of which had been drawn.
Convertible Bonds
During the financial year 2010, Ilkka-Yhtymä issued convertible bonds with a face value of EUR 20.0 million, the interest rate being 12-month euribor + 2% and the maturity six years. The bonds are convertible into a maximum of 2,835,000 new Series II shares of Ilkka-Yhtymä or shares in the possession of the company, so that half of the bonds can be converted as of 2 January 2012 into 1,417,500 shares and the other half as of 1 November 2014 into 1,417,500 shares. The conversion price per share, rounded up, is EUR 7.05. The conversion price of shares will be recorded in the company's invested unrestricted equity fund. Dividends paid and other distribution of funds by Ilkka-Yhtymä prior to bond conversion will be compensated by lowering the conversion price. If the aggregate conversion price of a convertible bond is below its face value due to a lowered conversion price, at its own discretion the company will pay for the difference either in cash or in shares. If, in the conversion of bonds, the company decides to issue new shares, the number of the company's shares may increase by a maximum of 2,835,000 Series II shares. Any new shares of Ilkka-Yhtymä issued in conversion will represent a maximum of 9.9% of the company's shares and 2.6% of votes following conversion.
On the date of issue, the convertible bonds were recognised entirely in financial liabilities, since on that date the fair value of the debt component equalled the face value of the convertible bonds. The fair value of the debt component is the net present value of the bond's cash flows discounted by the market rate. The market rate used is the interest rate of a comparable liability without a conversion right and was defined by third parties.
22. ACCOUNTS PAYABLE AND OTHER PAYABLES
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Advances received | 2 110 | 2 301 |
| Accounts payable (financial liability measured at cost) | 1 025 | 1 273 |
| Liabilities to associated companies (financial liabilities measured at cost) | 8 | 16 |
| Interest rate swaps (financial liability measured at cost) | 1 803 | 1 701 |
| Accrued expenses and deferred income | 2 375 | 2 483 |
| Other payables | 1 020 | 994 |
| Accounts payable and other payables | 8 340 | 8 768 |
| Substantial accrued expenses and deferred income items | ||
| Accruals of personnel expenses | 2 207 | 2 277 |
| Other items | 167 | 207 |
| Total | 2 375 | 2 483 |
Annual Report 2014
FINANCIAL STATEMENTS
23. FINANCIAL RISK MANAGEMENT
The Board of Directors defines the principles of financial risk management. Risk management measures are attended to on a centralised basis by the finance department of the Group's parent company. The parent company is responsible for the Group's financing on a centralised basis. The Group is exposed to interest-rate risk and risk associated with share prices.
Foreign exchange risk
The Group's foreign exchange risk is not material, as business transactions are primarily carried out in euros.
Interest rate risk
The Group's interest-rate risk consists of changes in market interest rates applied in the loan portfolio. The company follows an interest-rate management policy confirmed by the Board of Directors. With respect to interest-rate risk management, the goal is to reduce the volatility of interest expenses in order to keep interest expenses, and the associated risk that they will grow, at an acceptable level. Interest-rate risk is managed by selecting both fixed and floating interest rates in loans, and using interest-rate fixing periods. If necessary, in order to hedge against interest-rate risk, the company can rely on interest rate swaps.
The company's loan arrangements involve ordinary collaterals and no special covenants.
On 31 December 2014, the Group's interest-bearing liabilities totalled EUR 56.9 million (EUR 66.4 million on 31 Dec. 2013), including EUR 20.0 million in the form of convertible bonds. At the end of the 2014 financial year, the average maturity of the interest-bearing liabilities was 3 years 11 months (3 years 5 months on 31 December 2013).
In order to hedge against interest rate risk, the company has transformed some of its floating-rate liabilities to a fixed rate, by means of interest rate swaps. Presently, some 53% of the loans in the company's total loan portfolio have a fixed rate and some 47% a floating rate. Under the loan terms, finance providers may review loan margins at agreed intervals. At the end of the 2014 financial year, these loans amounted to EUR 36.7 million.
As at 31 December 2014, the impact of floating-rate interest-bearing liabilities on profit before taxes would have amounted to -/+ EUR 267 thousand over the next 12 months, if the interest level increases or decreases by one percentage point.
Market risk of investment activities
Investments are made through well-known partners with high credit rating. In relation to its operations, the Group is subject to price risks for listed shares due to fluctuations in market prices. The Group's Board of Directors has defined the boundary conditions for its investments in shares and reviews the related risk assessment.
Investment sensitivity analysis
The annual change of the OMX Helsinki Cap Index was 5.65%. At the end of 2014, the market value of the Group's financial assets recognised at fair value through profit or loss was EUR 1,089 thousand (EUR 1,259 thousand in 2013). Changes in the value of financial assets recognised at fair value through profit or loss affect earnings after tax. If the market prices of shares went up or down by 10% and other factors remained the same, the change in the income statement would be +/- EUR 87 thousand.
Annual Report 2014 | 57
FINANCIAL STATEMENTS
FAIR VALUE HIERARCHY OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES MEASURED AT FAIR VALUE
| EUR 1,000 | 31.12.2014 | Fair value at end of period | ||
|---|---|---|---|---|
| Level 1 | Level 2 | Level 3 | ||
| Assets measured at fair value | ||||
| Financial assets at fair value through profit or loss | 1 089 | 1 089 | ||
| Available-for-sale financial assets | 1 533 | 1 533 | ||
| Total | 2 623 | 1 089 | 1 533 | |
| Liabilities measured at fair value | ||||
| Interest rate swaps | 1 803 | 1 803 | ||
| Total | 1 803 | 1 803 | ||
| Fair value at end of period | ||||
| EUR 1,000 | 31.12.2013 | Level 1 | Level 2 | Level 3 |
| Assets measured at fair value | ||||
| Financial assets at fair value through profit or loss | 1 259 | 1 259 | ||
| Available-for-sale financial assets | 9 249 | 9 249 | ||
| Total | 10 507 | 1 259 | 9 249 | |
| Liabilities measured at fair value | ||||
| Interest rate swaps | 1 701 | 1 701 | ||
| Total | 1 701 | 1 701 |
Available-for-sale assets also include EUR 1,420 thousand (EUR 1,419 thousand in 2013) for unlisted shares, which are measured at cost since no reliable fair value was available for them.
At Level 1 of the hierarchy, fair value is based on quoted prices (unadjusted) in active markets for identical assets or liabilities.
At Level 2, the instruments' fair value is based on inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
At Level 3, the instruments' fair value is based on inputs for the asset or liability that are not based on observable market data.
Credit risk
The company receives its subscription payments in advance. Receivables from advertising and printing sales are spread among a wide group of domestic customers. The company keeps customer balances under constant surveillance and reacts to outstanding accounts immediately. The maximum exposure of the Group's credit risk corresponds to the carrying amount of the above-mentioned financial asset classes at the end of the financial year (Notes 13, 16, 17 and 18).
Liquidity risk
The Group evaluates and continuously monitors the amount of financing required in its operations. The Group seeks to maintain the availability and flexibility of financing by means of credit limit. At the end of the financial year, the Group's cash and cash equivalents amounted to EUR 5.5 million (EUR 2.0 million on 31 Dec. 2013). Unused credit limits totalled EUR 13 million on 31 December 2014 (EUR 13 million on 31 Dec. 2013). The terms and conditions of debt contain no covenants. As collateral for liabilities, the Group has granted share pledges as well as real estate and corporate mortgages, which are presented under Note 25.
Annual Report 2014
FINANCIAL STATEMENTS
The maturities of interest-bearing liabilities are presented in the table below. The figures have not been discounted.
| 31.12.2014 (EUR 1,000) | Carrying amount | Cash flow | Less than 1 year | 1-2 years | 2-5 years | Over 5 years |
|---|---|---|---|---|---|---|
| Repayment | 56 684 | 56 718 | 2 353 | 22 603 | 10 059 | 21 703 |
| Payment of interest *) | 5 548 | 1 357 | 1 223 | 2 007 | 961 | |
| Total | 56 684 | 62 266 | 3 710 | 23 826 | 12 066 | 22 664 |
| 31.12.2013 (EUR 1,000) | Carrying amount | Cash flow | Less than 1 year | 1-2 years | 2-5 years | Over 5 years |
| Repayment | 66 094 | 66 167 | 5 914 | 5 914 | 47 281 | 7 059 |
| Payment of interest *) | 5 599 | 1 603 | 1 453 | 2 365 | 179 | |
| Total | 66 094 | 71 767 | 7 517 | 7 367 | 49 646 | 7 238 |
*) Cash flows from interest rate swaps are included in payment of interest.
24. LEASES
GROUP AS LESSEE
Minimum rents payable under non-cancellable operating leases:
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Due within one year | 21 | 49 |
| Due within more than one but no more than five years | 21 | |
| Total | 21 | 71 |
GROUP AS LESSOR
Minimum rents receivable under non-cancellable operating leases:
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Due within one year | 80 | 80 |
| Due within more than one but no more than five years | 239 | 315 |
| Total | 318 | 395 |
Leases are tied to the cost-of-living index.
FINANCE LEASE
Gross finance lease liabilities - maturity of minimum lease payments
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Due within one year | 44 | 44 |
| Due within more than one but no more than five years | 178 | 178 |
| Due within more than five years | 67 | 111 |
| Total | 289 | 333 |
Finance lease liabilities - present value of minimum lease payments
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| Due within one year | 34 | 33 |
| Due within more than one but no more than five years | 153 | 147 |
| Due within more than five years | 64 | 105 |
| Total | 252 | 285 |
| Financial expenses accruing in the future | 37 | 48 |
Annual Report 2014 | 59
FINANCIAL STATEMENTS
25. CONTINGENT LIABILITIES
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| COLLATERAL PLEDGED FOR OWN COMMITMENTS | ||
| Loans secured with mortgages | ||
| Loans from financial institutions | 36 718 | 46 167 |
| Total | 36 718 | 46 167 |
| Unused credit limits | 13 000 | 13 000 |
| Mortgages on real estate | 8 801 | 8 801 |
| Mortgages on company assets | 1 245 | 1 245 |
| Mortgages total | 10 045 | 10 045 |
| Pledged shares | 50 491 | 49 680 |
| CONTINGENT LIABILITIES ON BEHALF OF ASSOCIATED COMPANY | ||
| Guarantees | 3 961 | 4 059 |
Other liabilities
The Group is required to adjust the VAT deductions made on real estate investments conducted in 2008 and in 2010, should taxable use of the real estate be reduced during the adjustment period. The maximum amount of this liability is presented in the table below.
| Year of completion of the investment | EUR 1,000 |
|---|---|
| 2008 | 21 |
| 2010 | 31 |
| Total | 52 |
26. RELATED PARTY TRANSACTIONS
Ilkka-Yhtymä Group's related parties include associated companies, members of the Board of Directors, members of the Supervisory Board, the Managing Director and the Group Executive Team.
Parent company ownership in the Group's subsidiaries is as follows:
| Company | Domicile | Shareholding | Proportion of votes |
|---|---|---|---|
| The parent company Ilkka-Yhtymä Oyj | Seinäjoki | ||
| I-Mediat Oy | Seinäjoki | 100 % | 100 % |
| I-print Oy | Seinäjoki | 100 % | 100 % |
| Pohjalaismediat Oy | Seinäjoki | 100 % | 100 % |
| Kiinteistö Oy Seinäjoen Koulukatu 10 | Seinäjoki | 100 % | 100 % |
| Seinäjoen Kassatalo Osakeyhtiö | Seinäjoki | 100 % | 100 % |
Information on associated companies can be found in section 12.
The following related party transactions were carried out:
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| SALES OF GOODS AND SERVICES | ||
| To associated companies | 256 | 261 |
| To other related parties | 837 | 860 |
| PURCHASES OF GOODS AND SERVICES | ||
| To associated companies | 335 | 464 |
| To other related parties | 4 | 29 |
Annual Report 2014
FINANCIAL STATEMENTS
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| TRADE RECEIVABLES | ||
| From other related parties | 16 | 61 |
Transactions with related parties are conducted at fair market prices.
Receivables and debts from associated companies are described in notes 16 and 22.
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| EMPLOYEE BENEFITS TO MANAGEMENT | ||
| Salaries and other short-term employee benefits | 1 005 | 989 |
Management comprises the Board of Directors, Supervisory Board, Managing Director and Group Executive Team. The stated figures based on the cash method do not differ significantly from those based on the accrual method.
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| SALARIES AND FEES | ||
| Managing Directors and Board Members | 576 | 578 |
| Members of the Supervisory Board | 39 | 37 |
Managing Director Matti Korkiatupa's salary and benefits for the accounting period totalled EUR 309 thousand. Korkiatupa's statutory accrued pension costs amounted to EUR 47 thousand. The Managing Director's pension plan is in compliance with employment pension legislation. Pension contributions worth EUR 53 thousand were paid for the Managing Director to the voluntary, contribution-based group pension insurance. The Managing Director's retirement age is in line with the current retirement pension scheme. In the case of dismissal by the company, the Managing Director's period of notice is six months before the age of 63, in addition to which the company will pay severance pay equalling an 18 months' salary. In the event of a merger or other business reorganisation, the severance pay will correspond to a 24 months' salary. The Managing Director must give six months' notice.
The statutory accrued pension costs of the members of the Board of Directors and the Chairman of the Supervisory Board amounted to EUR 26 thousand.
27. CAPITAL MANAGEMENT
The objective of the Group's capital management is to ensure normal operating conditions and to accumulate long-term shareholder value. The capital structure is influenced, for instance, by the distribution of dividends. Ilkka-Yhtymä Oyj pursues an active dividend policy and aims to distribute at least half of the Group's annual results in dividends. However, dividend distribution is affected not only by the earnings trend, but also by the Group's financial standing, the financing required for profitable growth and the company's future outlook and development needs.
The Group's net interest-bearing liabilities amounted to EUR 50.3 million at the end of 2014. With a target equity ratio of 40% defined by the Board of Directors, the Group's equity ratio in 2014 reached 50.2% (44.2%).
| EUR 1,000 | 2014 | 2013 |
|---|---|---|
| THE GROUP'S NET LIABILITIES | ||
| Interest-bearing liabilities | 56 936 | 66 379 |
| Cash and cash equivalents | 5 534 | 1 980 |
| Financial assets at fair value through profit or loss | 1 089 | 1 259 |
| Net liabilities | 50 313 | 63 140 |
| Shareholder's equity | 64 503 | 58 091 |
| Net gearing | 78.0 % | 108.7 % |
28. EVENTS AFTER THE BALANCE SHEET DATE
The Board of Directors is not aware of any significant events after the balance sheet date that would have had an effect on the calculations in the financial statements.
Annual Report 2014 | 61
FINANCIAL STATEMENTS
Iikka-Yhtymä Group 2012-2014
Key figures on financial performance
| ILKKA-YHTYMÄ GROUP | 2014 | 2013 | 2012 |
|---|---|---|---|
| Net sales, MEUR | 41.8 | 44.9 | 46.2 |
| -change % | -6.9 | -2.7 | -7.6 |
| Operating profit/loss, MEUR | 9.3 | -16.6 | -10.9 |
| -% of net sales | 22.1 | -37.0 | -23.5 |
| Profit/loss before tax, MEUR | 10.1 | -17.0 | -13.4 |
| -% of net sales | 24.2 | -37.8 | -29.1 |
| Profit/loss for the financial period, MEUR | 9.1 | -18.2 | -14.1 |
| -% of net sales | 21.7 | -40.5 | -30.5 |
| Return on equity (ROE), % | 14.8 | -26.2 | -15.2 |
| Return on investment (ROI), % *) | 9.7 | -11.6 | -6.2 |
| Equity ratio, % | 50.2 | 44.2 | 50.7 |
| Net gearing, % | 78.0 | 108.7 | 82.7 |
| Gross capital expenditure, MEUR **) | 0.5 | 1.4 | 1.3 |
| -% of net sales | 1.1 | 3.2 | 2.8 |
| Balance sheet total, MEUR | 130.5 | 133.8 | 160.8 |
| Current ratio | 0.91 | 0.45 | 0.47 |
| Average no. of employees | 311 | 321 | 336 |
) Excludes unrealised gains/losses on interest rate swaps
*) Includes investments in tangible and intangible assets and shares in associated companies and in available-for-sale financial assets.
Per-share ratios
| ILKKA-YHTYMÄ GROUP | 2014 | 2013 | 2012 |
|---|---|---|---|
| Earnings per share (EPS), EUR | 0.35 | -0.71 | -0.55 |
| Cash flow from operations per share, EUR | 0.14 | 0.33 | 0.31 |
| Shareholders' equity per share, EUR | 2.51 | 2.26 | 3.14 |
| Dividend per share (Series I), EUR *) | 0.10 | 0.10 | 0.15 |
| Dividend per share (Series II), EUR *) | 0.10 | 0.10 | 0.15 |
| Dividend per earnings (Series I), % | 28.3 | neg. | neg. |
| Dividend per earnings (Series II), % | 28.3 | neg. | neg. |
| Effective dividend yield (Series I), % | 3.3 | 2.1 | 2.1 |
| Effective dividend yield (Series II), % | 5.2 | 3.5 | 3.1 |
| Price per earnings (P/E) (Series I) | 8.5 | neg. | neg. |
| Price per earnings (P/E) (Series II) | 5.4 | neg. | neg. |
| Price development of shares | |||
| average price (Series I), EUR | 2.94 | 5.24 | 7.96 |
| average price (Series II), EUR | 2.28 | 3.39 | 5.82 |
| lowest price (Series I), EUR | 2.11 | 4.36 | 6.40 |
| lowest price (Series II), EUR | 1.83 | 2.76 | 4.56 |
| highest price (Series I), EUR | 4.98 | 7.95 | 11.29 |
| highest price (Series II), EUR | 3.05 | 5.19 | 7.67 |
| price at the end of period (Series I), EUR | 3,00 | 4,69 | 7.00 |
| price at the end of period (Series II), EUR | 1.91 | 2.89 | 4.82 |
| Market capitalisation, MEUR | 53.7 | 81.9 | 133.1 |
| Shares traded (Series I), number of shares | 238 632 | 52 945 | 41 148 |
| - % of total number of shares | 5.5 | 1.2 | 1.0 |
| Shares traded (Series II), number of shares | 3 320 092 | 2 059 508 | 947 266 |
| - % of total number of shares | 15.5 | 9.6 | 4.4 |
| Average number of shares during the financial period | 25 665 208 | 25 665 208 | 25 665 208 |
| Number of shares at the end on the financial period | 25 665 208 | 25 665 208 | 25 665 208 |
*) 2014: Proposal of the Board of Directors
Annual Report 2014
FINANCIAL STATEMENTS
Calculation principles of key figures and ratios
THE FOLLOWING FORMULAS ARE USED TO CALCULATE THE GROUP'S FINANCIAL PERFORMANCE:
| Return on equity (%) (ROE) | = | Net profit | Shareholders' equity (average) | x 100 |
|---|---|---|---|---|
| Return on investment (%) (ROI) | = | Profit before taxes+ interest and other financial expenses | Balance sheet total - non-interest-bearing liabilities (average) | x 100 |
| Equity ratio (%) | = | Shareholders' equity | Balance sheet total - Advances received | x 100 |
| Interest-bearing liabilities - cash and cash equivalents - financial assets measured at fair value through profit or loss | ||||
| Shareholders' equity | Current assets | x 100 | ||
| Net gearing (%) | = | Current liabilities |
THE FOLLOWING FORMULAS ARE USED TO CALCULATE PER-SHARE RATIOS:
| Earnings per share (EPS) | = | Net profit | Average number of shares during the period |
|---|---|---|---|
| Cash flow from operations per share | = | Cash flow from operations | Average number of shares during the period |
| Shareholders' equity per share | = | Shareholders' equity | Number of shares on the balance sheet date |
| Dividend per share | = | Dividend per share approved by the Annual General Meeting. With respect to 2014, the Board of Directors' proposal to the Annual General Meeting for a dividend. | |
| Dividend per earnings (%) | = | Dividend per share | Earnings per share |
| Effective dividend yield (%) | = | Dividend per share | Closing share price |
| Price/Earnings ratio (P/E) | = | Closing share price | Earnings per share |
| Adjusted average share price | = | Total turnover of shares, EUR | Shares traded, number of shares |
| Market capitalisation | = | Number of shares x the share's closing price |
Annual Report 2014 | 63
FINANCIAL STATEMENTS
Parent Company Income Statement, FAS
| (EUR 1,000) | NOTE | 1.1.-31.12.2014 | 1.1.-31.12.2013 |
|---|---|---|---|
| NET SALES | 1 | 2 297 | 2 761 |
| Other operating income | 2 | 1 169 | 1 177 |
| Material and services | 3 | -176 | -457 |
| Personnel costs | 4 | -2 011 | -1 976 |
| Depreciation | 5 | -336 | -358 |
| Other operating costs | 6 | -1 670 | -1 837 |
| OPERATING PROFIT/ LOSS | -727 | -690 | |
| Financial income and expenses | 7 | 348 | -45 762 |
| PROFIT/ LOSS BEFORE EXTRAORDINARY ITEMS | -379 | -46 452 | |
| Extraordinary items | 8 | 5 000 | 5 800 |
| PROFIT/ LOSS AFTER EXTRAORDINARY ITEMS | 4 621 | -40 652 | |
| Appropriations | 67 | 65 | |
| Income taxes | 9 | -876 | -837 |
| PROFIT/ LOSS FOR THE FINANCIAL PERIOD | 3 812 | -41 423 |
Parent Company Balance Sheet, FAS
| (EUR 1,000) | NOTE | 31.12.2014 | 31.12.2013 |
|---|---|---|---|
| ASSETS | |||
| NON-CURRENT ASSETS | |||
| Intangible assets | 10 | 112 | 101 |
| Tangible assets | 10 | 3 886 | 4 061 |
| Investments | 11 | 117 643 | 127 173 |
| NON-CURRENT ASSETS | 121 641 | 131 334 | |
| CURRENT ASSETS | |||
| Inventories | 12 | 1 017 | 1 193 |
| Non-current receivables | 13 | 567 | |
| Current receivables | 13 | 714 | 1 484 |
| Cash and bank deposits | 2 897 | 473 | |
| CURRENT ASSETS | 5 196 | 3 151 | |
| ASSETS | 126 837 | 134 485 | |
| SHAREHOLDERS' EQUITY AND LIABILITIES | |||
| SHAREHOLDERS' EQUITY | |||
| Share capital | 6 416 | 6 416 | |
| Other reserves | 48 498 | 48 498 | |
| Retained earnings | 2 728 | 46 717 | |
| Profit/ loss for the financial period | 3 812 | -41 423 | |
| SHAREHOLDERS' EQUITY | 14 | 61 454 | 60 208 |
| ACCUMULATED APPROPRIATIONS | 15 | 757 | 823 |
| LIABILITIES | |||
| Non-current interest-bearing liabilities | 54 331 | 60 180 | |
| Current interest-bearing liabilities | 7 230 | 10 482 | |
| Current interest-free liabilities | 3 065 | 2 792 | |
| LIABILITIES | 16 | 64 627 | 73 454 |
| SHAREHOLDERS' EQUITY AND LIABILITIES | 126 837 | 134 485 |
FAS=Finnish Accounting Standards
Annual Report 2014
FINANCIAL STATEMENTS
Parent Company Cash Flow Statement, FAS
| (EUR 1,000) | 2014 | 2013 |
|---|---|---|
| CASH FLOW FROM OPERATIONS | ||
| Profit/ loss for the period under review | 3 812 | -41 423 |
| Adjustments | -4 223 | 41 085 |
| Change in working capital | 233 | 413 |
| Cash flow from operations before financial items and taxes | -179 | 74 |
| Interest paid | -1 720 | -1 812 |
| Interest received | 16 | 8 |
| Dividends received | 16 | 3 740 |
| Other financial items | -1 | |
| Direct taxes paid | -633 | -694 |
| Cash flow from operations | -2 500 | 1 316 |
| CASH FLOW FROM INVESTMENTS | ||
| Investments in tangible and intangible assets, net | -125 | -184 |
| Capital repayment received | 2 249 | |
| Other investments | -25 | 118 |
| Proceeds from sale of other investments | 8 888 | |
| Granted loans | -567 | |
| Addition(-)/ deduction(+) of cash equivalents | 150 | -93 |
| Dividends received from investments | 443 | 472 |
| Cash flow from investments | 11 012 | 313 |
| Cash flow before financing items | 8 513 | 1 629 |
| CASH FLOW FROM FINANCING | ||
| Change in current loans | -3 252 | -8 829 |
| Change in non-current loans | -5 889 | |
| Group contributions received and paid | 5 600 | 10 800 |
| Dividends paid and other profit distribution | -2 548 | -3 818 |
| Cash flow from financing | -6 089 | -1 847 |
| Increase (+) or decrease (-) in financial assets | 2 424 | -218 |
| LIQUID ASSETS AT THE BEGINNING OF THE FINANCIAL PERIOD | 473 | 691 |
| LIQUID ASSETS AT THE END OF THE FINANCIAL PERIOD | 2 897 | 473 |
| NOTES TO THE CASH FLOW STATEMENT: | ||
| ADJUSTMENTS TO PROFIT/ LOSS FOR THE PERIOD | ||
| Depreciation | 336 | 358 |
| Sales gains (-) and losses (+) on non-current assets | -21 | -6 |
| Unrealised fair-value gains (-) or losses (+) | 102 | -734 |
| Financial income and expenses | -451 | 46 496 |
| Income taxes | 876 | 837 |
| Other adjustments | -5 067 | -5 865 |
| Adjustments to profit/ loss for the period total | -4 223 | 41 085 |
| CHANGE IN WORKING CAPITAL | ||
| Increase (-)/ decrease (+) in inventories | 176 | 456 |
| Increase (-)/ decrease (+) in current interest-free operating receivables | 42 | -2 |
| Increase (+)/ decrease (-) in current interest-free liabilities | 14 | -41 |
| Change in working capital total | 233 | 413 |
Annual Report 2014 | 65
FINANCIAL STATEMENTS
Notes to the Parent Company's Financial Statements
ACCOUNTING PRINCIPLES
Ilkka-Yhtymä Oyj's financial statements were prepared in accordance with the Finnish Accounting Standards and other rules and regulations governing the preparation of financial statements (FAS).
COMPARABILITY OF DATA
The figures for 2014 are comparable with those of 2013.
SECURITIES TRADING
In the parent company financial statements securities trading is presented as gross of net sales and purchases.
INVENTORIES
Inventories were valued either at acquisition cost or probable sales value, whichever was the lowest. Marketable securities were valued at their direct acquisition cost, average closing price or probable sales price, whichever was the lowest.
FIXED ASSETS AND DEPRECIATION
Revaluations included in balance sheet values of buildings and land were reversed in 2003. Other fixed assets were valued at the original acquisition cost less depreciation according to plan. Depreciation according to plan was calculated as straight-line depreciation from the original acquisition price of fixed assets on the basis of the economic life of the assets. The depreciation periods for different assets are as follows:
| Intangible rights and other long-term assets | 3-10 years |
|---|---|
| Buildings | 20-40 years |
| Structures | 20 years |
| Machinery and equipment | 3-15 years |
PERIODISATION OF PENSION EXPENSES
Employee pension schemes are arranged through insurance companies.
ITEMS IN FOREIGN CURRENCIES
Receivables and debts in foreign currencies were converted to euros according to the average exchange rate of the European Central Bank on the closing date of the financial statements.
EXTRAORDINARY ITEMS
Group contributions are entered in extraordinary items.
Annual Report 2014
FINANCIAL STATEMENTS
Notes to the Income Statement and the Balance Sheet
| (EUR 1,000) | 2014 | 2013 |
|---|---|---|
| 1. NET SALES | ||
| Net sales by operating sector | ||
| Other operations | 2 258 | 2 302 |
| Securities trading | 39 | 459 |
| Total | 2 297 | 2 761 |
- OTHER OPERATING INCOME
| Sales gains on fixed assets | 21 | 6 |
|---|---|---|
| Rent income | 1 144 | 1 162 |
| Other | 4 | 9 |
| Total | 1 169 | 1 177 |
- MATERIALS AND SERVICES
| Increase or decrease of stocks | 176 | 456 |
|---|---|---|
| Materials and supplies total | 176 | 456 |
| External charges | 1 | |
| Materials and services total | 176 | 457 |
- PERSONNEL COSTS
| Salaries and fees | 1 626 | 1 600 |
|---|---|---|
| Pension expenses | 326 | 321 |
| Other personnel costs | 59 | 55 |
| Total | 2 011 | 1 976 |
| MANAGEMENT'S SALARIES AND FEES | ||
| Managing Director | 301 | 300 |
| Members of the Board of Directors | ||
| Paatelainen Seppo (until 5 May 2014) | 13 | 36 |
| Aukia Timo | 31 | 24 |
| Lager Esa | 22 | 20 |
| Hautanen Markku (since 5 May 2014) | 12 | |
| Mutka Sari | 19 | 20 |
| Savola Tapio | 19 | 20 |
| Viitala Riitta | 19 | 20 |
| Members of the Supervisory Board | ||
| Hautala Lasse, Chairman | 23 | 24 |
Other members
The members receive EUR 400 for each meeting (EUR 400 in 2013). The Supervisory Board convened twice during 2014 and 2013.
Managing Director Matti Korkiatupa's salary and benefits for the accounting period totalled EUR 301 thousand. Korkiatupa's statutory accrued pension costs amounted to EUR 46 thousand. The Managing Director's pension plan is in compliance with employment pension legislation. Pension contributions worth EUR 53 thousand were paid for the Managing Director to the voluntary, contribution-based group pension insurance. The statutory accrued pension costs of the members of the Board of Directors and the Chairman of the Supervisory Board amounted to EUR 23 thousand.
Personnel on average during the financial period
Corporate services 24 24
Annual Report 2014 | 67
FINANCIAL STATEMENTS
| (EUR 1,000) | 2014 | 2013 |
|---|---|---|
| 5. DEPRECIATION ACCORDING TO PLAN | ||
| Intangible rights | 43 | 58 |
| Other long-term assets | 3 | |
| Buildings and constructions | 166 | 186 |
| Machinery and equipment | 128 | 111 |
| Total | 336 | 358 |
| 6. OTHER OPERATING EXPENSES | ||
| Costs for premises | 681 | 683 |
| Other cost items | 989 | 1 154 |
| Total | 1 670 | 1 837 |
| Audit fees | ||
| Statutory audits | 43 | 30 |
| Tax counselling | 2 | |
| Other fees | 14 | 51 |
| Total | 58 | 83 |
| 7. FINANCIAL INCOME AND EXPENSES | ||
| FINANCIAL INCOME | ||
| DIVIDEND YIELDS | ||
| From Group companies | 1 475 | |
| From associated companies | 16 | 2 265 |
| From others | 443 | 456 |
| Total | 459 | 4 195 |
| Interest income from non-current investments | ||
| Interest income from associated companies | 22 | |
| Total | 22 | |
| OTHER INTEREST AND FINANCIAL INCOME | ||
| From Group companies | 15 | 8 |
| From others | 1 843 | 140 |
| Total | 1 858 | 148 |
| Unrealised change in the market value of the interest rate swaps | 734 | |
| Financial income total | 2 338 | 5 077 |
| FINANCIAL EXPENSES | ||
| Impairment for non-current investments | ||
| Impairment for shares in Group companies | -151 | |
| Impairment for shares in associated companies | -49 000 | |
| Total | -151 | -49 000 |
| OTHER INTEREST AND FINANCIAL EXPENSES | ||
| To Group companies | -71 | -64 |
| To others | -1 666 | -1 775 |
| Total | -1 737 | -1 839 |
| Unrealised change in the market value of the interest rate swaps | -102 | |
| Financial expenses total | -1 990 | -50 839 |
| FINANCIAL INCOME AND EXPENSES TOTAL | 348 | -45 762 |
| Interest income total | 38 | 8 |
| Interest expense total | -1 737 | -1 838 |
Annual Report 2014
FINANCIAL STATEMENTS
| (EUR 1,000) | 2014 | 2013 |
|---|---|---|
| 8. EXTRAORDINARY ITEMS | ||
| Extraordinary income | 5 000 | 5 800 |
| Extraordinary items consist of Group contributions received. |
9. INCOME TAXES
| Income tax on extraordinary items | 1 000 | 1 421 |
|---|---|---|
| Income tax on ordinary operations | -111 | -584 |
| Taxes on previous financial periods | -13 | |
| Total | 876 | 837 |
10. INTANGIBLE AND TANGIBLE ASSETS
| (EUR 1,000) | Intangible rights | Other longterm assets | Total |
|---|---|---|---|
| INTANGIBLE ASSETS | |||
| Acquisition cost 1.1.2014 | 1 107 | 1 960 | 3 067 |
| Increase | 54 | 54 | |
| Acquisition cost 31.12.2014 | 1 161 | 1 960 | 3 121 |
| Accumulated depreciation and impairment 1.1.2014 | 1 014 | 1 952 | 2 966 |
| Depreciation for the financial period | 43 | 43 | |
| Accumulated depreciation 31.12.2014 | 1 057 | 1 952 | 3 009 |
| BOOK VALUE 31.12.2014 | 104 | 9 | 112 |
| BOOK VALUE 31.12.2013 | 93 | 9 | 101 |
| (EUR 1,000) | Land areas | Buildings and constructions | Machinery & equipment |
| --- | --- | --- | --- |
| TANGIBLE ASSETS | |||
| Acquisition cost 1.1.2014 | 452 | 7 262 | 6 327 |
| Increase | 7 | 72 | |
| Decrease | -66 | ||
| Transfers between items | |||
| Acquisition cost 31.12.2014 | 452 | 7 270 | 6 333 |
| Accumulated depreciation and impairment 1.1.2014 | 3 944 | 6 037 | |
| Accumulated depreciation of decrease and transfers | -66 | ||
| Depreciation for the financial period | 166 | 128 | |
| Accumulated depreciation 31.12.2014 | 4 110 | 6 099 | |
| BOOK VALUE 31.12.2014 | 452 | 3 160 | 234 |
| BOOK VALUE 31.12.2013 | 452 | 3 318 | 290 |
| Balance sheet value of production machinery and equipment 31.12.2014 | 124 | ||
| Balance sheet value of production machinery and equipment 31.12.2013 | 183 |
Annual Report 2014 | 69
FINANCIAL STATEMENTS
- INVESTMENTS
| (EUR 1,000) | Shares in Group companies | Shares in Associated companies | Other shares and holdings | Other investments | Total |
|---|---|---|---|---|---|
| Book value 1.1.2014 | 9 734 | 107 366 | 9 903 | 170 | 127 173 |
| Increase | 25 | 25 | |||
| Decrease | -17 | -7 138 | -7 155 | ||
| Capital repayment | -2 249 | -2 249 | |||
| Impairment | -151 | -151 | |||
| BOOK VALUE 31.12.2014 | 9 583 | 105 100 | 2 791 | 170 | 117 643 |
| (EUR 1,000) | 2014 | 2013 | |||
| DIFFERENCE IN MARKET VALUE AND BOOK VALUE OF PUBLICLY QUOTED SECURITIES | |||||
| Publicly quoted securities entered under investments | |||||
| Market value | 61 845 | 67 243 | |||
| Book value | 104 655 | 106 904 | |||
| Difference | -42 810 | -39 661 | |||
| Companies owned by the parent company | ownership % | ||||
| GROUP COMPANIES | |||||
| I-Mediat Oy, Seinäjoki | 100.0 | ||||
| I-print Oy, Seinäjoki | 100.0 | ||||
| Kiinteistö Oy Seinäjoen Koulukatu 10, Seinäjoki | 100.0 | ||||
| Seinäjoen Kassatalo Osakeyhtiö, Seinäjoki | 100.0 | ||||
| Pohjalaismediat Oy, Seinäjoki | 100.0 | ||||
| ASSOCIATED COMPANIES | |||||
| Alma Media Corporation, Helsinki | 29.79 | ||||
| Arena Partners Oy, Kuopio | 37.8 | ||||
| Yrittävä Suupohja Oy, Kauhajoki | 38.5 |
- INVENTORIES
| (EUR 1,000) | 2014 | 2013 |
|---|---|---|
| Inventories | 1 017 | 1 193 |
| Total | 1 017 | 1 193 |
| DIFFERENCE IN MARKET VALUE AND BOOK VALUE OF PUBLICLY QUOTED SECURITIES | ||
| Marketable securities | ||
| Market value | 1 089 | 1 259 |
| Book value | 1 017 | 1 193 |
| Difference | 73 | 65 |
Annual Report 2014
FINANCIAL STATEMENTS
- RECEIVABLES
(EUR 1,000)
| 2014 | 2013 | |
|---|---|---|
| NON-CURRENT RECEIVABLES | ||
| Receivables from associated companies | ||
| Loan receivables | 567 | |
| Total | 567 | |
| NON-CURRENT RECEIVABLES TOTAL | 567 | |
| Subordinate loans | ||
| Non-current receivables consist of subordinate loan to associated company. | ||
| Current receivables | ||
| Accrued income (from others) | 73 | 98 |
| Receivables from Group companies | ||
| Trade receivables | 317 | 336 |
| Loan receivables | 150 | |
| Other receivables | 302 | 901 |
| Total | 619 | 1 387 |
| Receivables from associated companies | ||
| Interest receivables | 22 | |
| Total | 22 | |
| CURRENT RECEIVABLES TOTAL | 714 | 1 484 |
| Substantial accrued income items | ||
| Accruals of personnel expenses | 17 | 26 |
| Other | 56 | 72 |
| Total | 73 | 98 |
- SHAREHOLDERS' EQUITY
| Share capital 1.1. | 6 416 | 6 416 |
|---|---|---|
| Share capital 31.12. | 6 416 | 6 416 |
| Invested unrestricted equity fund 1.1. | 48 498 | 48 498 |
| Invested unrestricted equity fund 31.12. | 48 498 | 48 498 |
| Retained earnings 1.1. | 5 294 | 49 193 |
| Dividend distribution | -2 567 | -3 850 |
| Other change in shareholders' equity *) | 1 374 | |
| Retained earnings 31.12. | 2 728 | 46 717 |
| Profit/ loss for the financial period | 3 812 | -41 423 |
| Shareholders' equity total | 61 454 | 60 208 |
*) The item includes a provision for investment used for property investment that was not recognised as income in previous years. This has been corrected by adjusting investments and the retained earnings of previous years in the 2013 financial statements. These adjustments have no impact on the results or cash flow.
STATEMENT OF DISTRIBUTABLE FUNDS 31.12.
| Retained earnings | 2 728 | 46 717 |
|---|---|---|
| Profit for the financial period | 3 812 | -41 423 |
| Invested unrestricted equity fund | 48 498 | 48 498 |
| Total | 55 038 | 53 792 |
| Breakdown of the Parent Company's share capital by share type: | ||
| Series I (20 votes/share) | 1 076 | 1 076 |
| Series II (1 vote/share) | 5 340 | 5 340 |
| Total | 6 416 | 6 416 |
The transfer of Series I shares is restricted by an approval clause. According to the clause, Series I shares cannot be transferred without the approval of the Board of Directors.
Annual Report 2014 | 71
FINANCIAL STATEMENTS
15. ACCUMULATED APPROPRIATIONS
Accumulated appropriations in Ilkka-Yhtymä Oyj consist of accumulated depreciation difference.
16. LIABILITIES
| (EUR 1,000) | 2014 | 2013 |
|---|---|---|
| NON-CURRENT LIABILITIES | ||
| Loans from financial institutions | 34 365 | 40 253 |
| Convertible bond | 19 967 | 19 927 |
| Total | 54 331 | 60 180 |
| NON-CURRENT LIABILITIES | 54 331 | 60 180 |
| LIABILITIES THAT MATURE IN MORE THAN FIVE YEARS | ||
| Loans from financial institutions | 21 703 | 7 059 |
| Total | 21 703 | 7 059 |
| CURRENT LIABILITIES | ||
| Loans from financial institutions | 2 353 | 5 914 |
| Accounts payable | 137 | 58 |
| Accrued expenses and deferred income | 839 | 635 |
| Other payables | 2 046 | 2 048 |
| Payables to Group companies | ||
| Accounts payable | 43 | 51 |
| Other payables | 4 877 | 4 568 |
| Total | 4 920 | 4 619 |
| CURRENT LIABILITIES | 10 295 | 13 273 |
| Substantial accrued expenses and deferred income items | ||
| Accruals of personnel expenses | 224 | 239 |
| Accruals of interest expenses | 105 | 128 |
| Accruals of income taxes | 498 | 255 |
| Other | 12 | 13 |
| Total | 839 | 635 |
| Interest-free liabilities | 3 065 | 2 792 |
17. GUARANTEES AND CONTINGENT LIABILITIES
COLLATERAL PLEDGED FOR OWN COMMITMENTS
Loans secured with mortgages
| Loans from financial institutions | 36 718 | 46 167 |
|---|---|---|
| Total | 36 718 | 46 167 |
| Unused credit limits | 13 000 | 13 000 |
| Mortgages on real estate | 4 672 | 4 672 |
| Pledged shares | 85 441 | 78 983 |
| Contingent liabilities on behalf of associated company | ||
| Guarantees | 3 961 | 4 059 |
Annual Report 2014
FINANCIAL STATEMENTS
ON 31 DECEMBER 2014, the share capital of Ilkka-Yhtymä Oyj entered in the Finnish Trade Register totalled EUR 6,416,302, the number of shares being 25,665,208. The shares are divided into two series. Series I shares and Series II shares differ in such a way that each Series I share entitles the holder to twenty (20) votes at the AGM, while a Series II share entitles the holder to one (1) vote. Shares of both series entitle the holders to the same dividend.
According to the Articles of Association, a single shareholder at a General Meeting may not use more than one twentieth (1/20) of the entire number of votes represented in a meeting.
The transfer of Series I shares is restricted by an approval clause. According to this clause, Series I shares cannot be transferred to another holder without the approval of the Board of Directors.
SHARE CAPITAL 31 DEC 2014
| Share capital EUR | Number of shares | % of share capital | % of votes | |
|---|---|---|---|---|
| Series I | 1 076 015 | 4 304 061 | 16.8 | 80.1 |
| Series II | 5 340 287 | 21 361 147 | 83.2 | 19.9 |
| Total | 6 416 302 | 25 665 208 | 100.0 | 100.0 |
QUOTATION AND TRADING IN SHARES
The Series I shares of Ilkka-Yhtymä Oyj were listed on the Helsinki Stock Exchange in 1981 and have remained listed ever since. The Series II shares have been listed since their issue in 1988, and on 10 June 2002 they were transferred from the I List of the Helsinki Stock Exchange to the Main List. At present, the Series II shares of Ilkka-Yhtymä Oyj are listed on the Nasdaq Helsinki List, in the Consumer Services sector, the company's market value being classified as Small Cap. The Series I shares are listed on the Pre List.
The number of Series I shares of Ilkka-Yhtymä Oyj traded in 2014 was 238,632, which represents 5.5% of the series share stock. The trading value of shares was EUR 0.7 million. The number of Series II shares traded totalled 3,320,092, which equals 15.5% of the series share stock. Their trading value was EUR 7.6 million. During the report period, the lowest quotation for Ilkka-Yhtymä Oyj's Series I share was EUR 2.11 and the highest EUR 4.98, while the lowest quotation for a Series II share was EUR 1.83 and the highest EUR 3.05. At the period-end closing price, the share capital market value was EUR 53.7 million.
Annual Report 2014 | 73
FINANCIAL STATEMENTS
MAJOR SHAREHOLDERS BY SHARES OWNED ACCORDING TO THE REGISTER OF OWNERS (ALL SHARES)
| 31 Dec 2014 | Series I | Series II | Shares in total | % of shares |
|---|---|---|---|---|
| Pohjois-Karjalan Kirjapaino Oyj | 99 | 2 613 125 | 2 613 224 | 10.18 % |
| Keskisuomalainen Oyj | 1 537 199 | 1 537 199 | 5.99 % | |
| Keski-Pohjanmaan Kirjapaino Oyj | 203 409 | 599 245 | 802 654 | 3.13 % |
| Ilmarinen Mutual Pension Insurance Company | 101 880 | 504 517 | 606 397 | 2.36 % |
| Mandatum Life Unit-Linked | 527 764 | 527 764 | 2.06 % | |
| Elo Mutual Pension Insurance Company | 92 924 | 419 693 | 512 617 | 2.00 % |
| Etelä-Pohjanmaan Lehtiseura ry | 216 229 | 265 917 | 482 146 | 1.88 % |
| Lako Mika | 90 892 | 236 386 | 327 278 | 1.28 % |
| TS-Yhtymä Oy | 40 050 | 239 829 | 279 879 | 1.09 % |
| Mäkelä Kai | 21 162 | 256 636 | 277 798 | 1.08 % |
| LocalTapiola General Mutual Insurance Company | 144 450 | 108 336 | 252 786 | 0.98 % |
| Mutka Heikki | 69 512 | 155 986 | 225 498 | 0.88 % |
| Aukia Jaakko | 7 448 | 207 905 | 215 353 | 0.84 % |
| Aukia Kari | 86 349 | 113 694 | 200 043 | 0.78 % |
| E-P:n Osuuskauppa | 111 864 | 84 024 | 195 888 | 0.76 % |
| Rinta-Jouppi Jarmo | 85 530 | 110 052 | 195 582 | 0.76 % |
| Aukia Timo | 89 482 | 90 245 | 179 727 | 0.70 % |
| Keskinen Martti | 172 541 | 172 541 | 0.67 % | |
| Oy Herttaässä Ab | 24 057 | 137 913 | 161 970 | 0.63 % |
| SV-Turkis Oy | 69 410 | 85 267 | 154 677 | 0.60 % |
| 20 major shareholders, total *) | 1 454 747 | 8 466 274 | 9 921 021 | 38.66 % |
| Nominee-registered | 416 818 | 416 818 | 1.62 % | |
| Other owners | 2 849 314 | 12 478 055 | 15 327 369 | 59.72 % |
| Total | 4 304 061 | 21 361 147 | 25 665 208 | 100.00 % |
*) Nominee-registered are not included.
MAJOR SHAREHOLDERS BY NUMBER OF VOTES ACCORDING TO THE SHAREHOLDERS' REGISTER (registered shares)
| 31 Dec 2014 | Series I reg. | % of shares | Series II | % of shares | Shares in total | % of votes |
|---|---|---|---|---|---|---|
| Keski-Pohjanmaan Kirjapaino Oyj | 190 552 | 4.43 % | 599 245 | 2.81 % | 789 797 | 4.10 % |
| Etelä-Pohjanmaan Lehtiseura ry | 201 588 | 4.68 % | 265 917 | 1.24 % | 467 505 | 4.00 % |
| Pohjois-Karjalan Kirjapaino Oyj | 99 | 0.00 % | 2 613 125 | 12.23 % | 2 613 224 | 2.43 % |
| Ilmarinen Mutual Pension Insurance Company | 101 880 | 2.37 % | 504 517 | 2.36 % | 606 397 | 2.37 % |
| E-P:n Osuuskauppa | 111 864 | 2.60 % | 84 024 | 0.39 % | 195 888 | 2.16 % |
| LocalTapiola General Mutual Insurance Company | 107 190 | 2.49 % | 108 336 | 0.51 % | 215 526 | 2.10 % |
| Elo Mutual Pension Insurance Company | 85 695 | 1.99 % | 419 693 | 1.96 % | 505 388 | 1.99 % |
| Aukia Timo | 89 482 | 2.08 % | 90 245 | 0.42 % | 179 727 | 1.75 % |
| Rinta-Jouppi Jarmo | 85 224 | 1.98 % | 110 052 | 0.52 % | 195 276 | 1.69 % |
| Mutka Heikki | 69 512 | 1.62 % | 155 986 | 0.73 % | 225 498 | 1.44 % |
| Keskisuomalainen Oyj | 1 537 199 | 7.20 % | 1 537 199 | 1.43 % | ||
| Etelä-Pohjanmaan Osuuspankki | 73 350 | 1.70 % | 60 445 | 0.28 % | 133 795 | 1.42 % |
| SV-Turkis Oy | 66 999 | 1.56 % | 85 267 | 0.40 % | 152 266 | 1.33 % |
| Kyrönmaan Osuuspankki | 55 134 | 1.28 % | 42 924 | 0.20 % | 98 058 | 1.07 % |
| Mikkilä Juha | 53 025 | 1.23 % | 33 016 | 0.15 % | 86 041 | 1.02 % |
| Rinta-Jouppi Ari | 48 555 | 1.13 % | 91 539 | 0.43 % | 140 094 | 0.99 % |
| Järvi-Laturi Heikki | 47 414 | 1.10 % | 80 971 | 0.38 % | 128 385 | 0.96 % |
| Aukia Kari | 40 397 | 0.94 % | 113 694 | 0.53 % | 154 091 | 0.86 % |
| Tolonen Hannele | 42 453 | 0.99 % | 14 500 | 0.07 % | 56 953 | 0.80 % |
| Heikkilä Veikko | 33 264 | 0.77 % | 68 569 | 0.32 % | 101 833 | 0.68 % |
| Total | 1 503 677 | 34.94 % | 7 079 264 | 33.14 % | 8 582 941 | 34.58 % |
74 | Annual Report 2014
FINANCIAL STATEMENTS
MAJOR SHAREHOLDERS BY SHARES OWNED ACCORDING TO THE SHAREHOLDERS' REGISTER (registered shares)
| 31 Dec 2014 | Series I reg. | Series II | Shares in total | % of shares |
|---|---|---|---|---|
| Pohjois-Karjalan Kirjapaino Oyj | 99 | 2 613 125 | 2 613 224 | 10.18 % |
| Keskisuomalainen Oyj | 1 537 199 | 1 537 199 | 5.99 % | |
| Keski-Pohjanmaan Kirjapaino Oyj | 190 552 | 599 245 | 789 797 | 3.08 % |
| Ilmarinen Mutual Pension Insurance Company | 101 880 | 504 517 | 606 397 | 2.36 % |
| Mandatum Life Unit-Linked | 527 764 | 527 764 | 2.06 % | |
| Elo Mutual Pension Insurance Company | 85 695 | 419 693 | 505 388 | 1.97 % |
| Etelä-Pohjanmaan Lehtiseura ry | 201 588 | 265 917 | 467 505 | 1.82 % |
| Mäkelä Kai | 20 892 | 256 636 | 277 528 | 1.08 % |
| Lako Mika | 20 270 | 236 386 | 256 656 | 1.00 % |
| TS-Yhtymä Oy | 9 000 | 239 829 | 248 829 | 0.97 % |
| Mutka Heikki | 69 512 | 155 986 | 225 498 | 0.88 % |
| LocalTapiola General Mutual Insurance Company | 107 190 | 108 336 | 215 526 | 0.84 % |
| Aukia Jaakko | 7 448 | 207 905 | 215 353 | 0.84 % |
| E-P:n Osuuskauppa | 111 864 | 84 024 | 195 888 | 0.76 % |
| Rinta-Jouppi Jarmo | 85 224 | 110 052 | 195 276 | 0.76 % |
| Aukia Timo | 89 482 | 90 245 | 179 727 | 0.70 % |
| Keskinen Martti | 172 541 | 172 541 | 0.67 % | |
| Oy Herttaässä Ab | 24 057 | 137 913 | 161 970 | 0.63 % |
| Aukia Kari | 40 397 | 113 694 | 154 091 | 0.60 % |
| SV-Turkis Oy | 66 999 | 85 267 | 152 266 | 0.59 % |
| Total | 1 232 149 | 8 466 274 | 9 698 423 | 37.79 % |
Nominee-registered are not included.
Annual Report 2014 | 75
FINANCIAL STATEMENTS
BOOK-ENTRY SYSTEM
Ilkka-Yhtymä Oyj's shares are included in the book-entry system. The notification date for the transfer to the book-entry system was 7 June 1995. A shareholder list of the company's shares and their holders is maintained at Euroclear Finland Oy.
MANAGEMENT HOLDINGS
On 31 December 2014, the company's Supervisory Board, the Board of Directors and the Managing Director held a total of 1,300,917 shares, or 5.07% of the entire share capital and 9.68% of the votes.
SHAREHOLDERS BY NUMBER OF SHARES HELD ON 31 DEC 2014 *)
| Number of shares, Series I | No. of holdings | % of holdings | No. of shares | % of shares |
|---|---|---|---|---|
| 1 - 200 | 1 852 | 52.12 | 165 377 | 3.84 |
| 201 - 400 | 615 | 17.31 | 176 487 | 4.10 |
| 401 - 2 000 | 882 | 24.82 | 779 329 | 18.11 |
| 2 001 - 4 000 | 96 | 2.70 | 254 366 | 5.91 |
| 4 001 - | 108 | 3.04 | 2 374 036 | 55.16 |
| TOTAL | 3 553 | 100.00 | 3 749 595 | 87.12 |
| On waiting list | 443 650 | 10.31 | ||
| In joint account | 110 816 | 2.57 | ||
| SHARES ISSUED | 4 304 061 | 100.00 | ||
| Number of shares, Series II | No. of holdings | % of holdings | No. of shares | % of shares |
| --- | --- | --- | --- | --- |
| 1 - 200 | 2 219 | 28.09 | 223 752 | 1.05 |
| 201 - 400 | 1 247 | 15.78 | 378 431 | 1.77 |
| 401 - 2 000 | 3 134 | 39.67 | 2 973 197 | 13.92 |
| 2 001 - 4 000 | 692 | 8.76 | 1 952 243 | 9.14 |
| 4 001 - | 608 | 7.70 | 15 728 193 | 73.63 |
| TOTAL | 7 900 | 100.00 | 21 255 816 | 99.51 |
| In joint account | 105 331 | 0.49 | ||
| SHARES ISSUED | 21 361 147 | 100.00 |
*) According to shareholders' register
Annual Report 2014
FINANCIAL STATEMENTS
SHAREHOLDERS BY SECTOR 31 DEC 2014 *)
| Shareholder category, Series I | No. of holdings | % of holdings | No. of shares | % of shares |
|---|---|---|---|---|
| Private companies | 51 | 1.44 | 506 191 | 11.76 |
| Financial institutions and insurance companies | 9 | 0.25 | 277 594 | 6.45 |
| Public-sector organisations | 3 | 0.08 | 188 142 | 4.37 |
| Non-profit organisations | 72 | 2.03 | 339 195 | 7.88 |
| Households | 3 417 | 96.17 | 2 438 158 | 56.65 |
| Foreign owners | 1 | 0.03 | 315 | 0.01 |
| TOTAL | 3 553 | 100.00 | 3 749 595 | 87.12 |
| On waiting list total | 443 650 | 10.31 | ||
| In joint account | 110 816 | 2.57 | ||
| SHARES ISSUED | 4 304 061 | 100.00 | ||
| Shareholder category, Series II | No. of holdings | % of holdings | No. of shares | % of shares |
| --- | --- | --- | --- | --- |
| Private companies | 206 | 2.61 | 6 248 931 | 29.25 |
| Financial institutions and insurance companies | 21 | 0.27 | 1 083 998 | 5.07 |
| Public-sector organisations | 5 | 0.06 | 933 705 | 4.37 |
| Non-profit organisations | 115 | 1.46 | 662 581 | 3.10 |
| Households | 7 542 | 95.47 | 11 900 355 | 55.71 |
| Foreign owners | 5 | 0.06 | 9 428 | 0.04 |
| Nominee-registered | 6 | 0.08 | 416 818 | 1.95 |
| TOTAL | 7 900 | 100.00 | 21 255 816 | 99.51 |
| In joint account | 105 331 | 0.49 | ||
| SHARES ISSUED | 21 361 147 | 100.00 |
*) According to shareholders' register
SHAREHOLDERS BY SECTOR 31 DEC 2014, SERIES I AND SERIES II
- Households... 55.9 %
- Private companies... 26.3 %
- Financial institutions and insurance companies ... 5.3 %
- Public-sector organisations ... 4.4 %
- Non-profit organisations ... 3.9 %
- On waiting list ... 1.7 %
- Nominee-registered ... 1.6 %
- In joint account ... 0.8 %
- Foreign owners ... 0.04 %
Annual Report 2014 | 77
FINANCIAL STATEMENTS
AVERAGE SHARE PRICE OF ILKKA-YHTYMÄ OYJ'S SHARES (EUR) 1 JAN 2010-31 DEC 2014
ILKKA-YHTYMÄ OYJ'S SHARES TRADED AS A PERCENTAGE OF TOTAL SHARES ISSUED (%) 2010-2014
Annual Report 2014
FINANCIAL STATEMENTS
PROPOSAL BY THE BOARD OF DIRECTORS ON PROFIT DISTRIBUTION
The parent company's distributable funds:
| Retained earnings | EUR 2,727,803.75 |
|---|---|
| The result for the financial year | EUR 3,812,068.76 |
| Invested unrestricted equity fund | EUR 48,497,751.08 |
Total EUR 55,037,623.59
The Board of Directors proposes to the Annual General Meeting that the profit for the financial year be entered in retained earnings and that a per share dividend of EUR 0.10 be distributed, i.e. a total dividend payment of EUR 2,566,520.80.
No substantial changes have taken place in the company's financial position since the end of the financial year. In the view of the Board of Directors, the proposed dividends do not jeopardise the company's liquidity.
Seinäjoki, 16 February 2015
BOARD OF DIRECTORS
Timo Aukia
Esa Lager
Markku Hautanen
Sari Mutka
Tapio Savola
Riitta Viitala
Matti Korkiatupa
Managing Director
A report on the audit has been issued today.
Seinäjoki, 18 February 2015
Ernst & Young Oy
Authorised Public Accountants
Harri Pärssinen
Authorised Public Accountant
Annual Report 2014 | 79
FINANCIAL STATEMENTS
Auditors' Report
TO THE ANNUAL GENERAL MEETING OF ILKKA-YHTYMÄ OYJ
We have audited the accounting records, the financial statements, the report of the Board of Directors and the administration of Ilkka-Yhtymä Oyj for the financial year 1 January - 31 December 2014. The financial statements comprise the consolidated balance sheet, income statement, statement of comprehensive income, cash flow statement, statement of changes in equity and notes to the consolidated financial statements, as well as the parent company's balance sheet, income statement, cash flow statement and notes to the financial statements.
RESPONSIBILITY OF THE BOARD OF DIRECTORS AND THE MANAGING DIRECTOR
The Board of Directors and the Managing Director are responsible for the preparation of the financial statements and the report of the Board of Directors and for the fair presentation of the consolidated financial statements in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU, as well as for the fair presentation of the parent company's financial statements and the report of the Board of Directors in accordance with laws and regulations governing the preparation of the financial statements and the report of the Board of Directors in Finland. The Board of Directors is responsible for the appropriate arrangement of the control of the company's accounts and finances, and the Managing Director shall see to it that the accounts of the company are in compliance with the law and that its financial affairs have been arranged in a reliable manner.
AUDITOR'S RESPONSIBILITY
Our responsibility is to express an opinion on the financial statements, on the consolidated financial statements and on the report of the Board of Directors based on our audit. The Auditing Act requires that we comply with the requirements of professional ethics. We conducted our audit in accordance with good auditing practice in Finland. Good auditing practice requires that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and the report of the Board of Directors are free from material misstatement, and whether the members of the parent company's Supervisory Board and Board of Directors and the Managing Director are guilty of an act or negligence which may result in liability in damages towards the company or whether they have violated the Limited Liability Companies Act or the articles of association of the company.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements and the report of the Board of Directors. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation of financial statements and report of the Board of Directors that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements and the report of the Board of Directors.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
OPINION ON THE CONSOLIDATED FINANCIAL STATEMENTS
In our opinion, the consolidated financial statements give a true and fair view of the financial position, financial performance, and cash flows of the group in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU.
OPINION ON THE COMPANY'S FINANCIAL STATEMENTS AND THE REPORT OF THE BOARD OF DIRECTORS
In our opinion, the financial statements and the report of the Board of Directors give a true and fair view of both the consolidated and the parent company's financial performance and financial position in accordance with the laws and regulations governing the preparation of the financial statements and the report of the Board of Directors in Finland. The information in the report of the Board of Directors is consistent with the information in the financial statements.
Seinäjoki 18 February 2015
Ernst & Young Oy
Authorised Public Accountants
Harri Pärssinen, Authorised Public Accountant
Annual Report 2014
FINANCIAL STATEMENTS
Supervisory Board's Statement
Having examined the company's and the consolidated balance sheets and income statements for 2014, and after reviewing the Auditor's Report, the Supervisory Board declares that it approves the Board of Directors' Report, the Financial Statements and the proposal for the allocation of the distributable funds. On this occasion, Supervisory Board also notifies that the terms of office of the following members of the Supervisory Board are about to expire: Lasse Hautala, Satu Heikkilä, Perttu Rinta, Ari Rinta-Jouppi, Minna Sillanpää, Raija Tikkala and Jorma Vierula.
Seinäjoki, 9 March 2015
Lasse Hautala
Chairman of the Supervisory Board
Matti Korkiatupa
Managing Director
Annual Report 2014 | 81
ADMINISTRATION
ADMINISTRATION
STRUCTURE OF THE ILKKA-YHTYMÄ GROUP
Ilkka-Yhtymä Group is a media group comprising the parent company Ilkka-Yhtymä Oyj, the publishing company I-Mediat Oy and the printing house I-print Oy. The Group also includes two property companies and Alma Media Corporation (29.79%), Arena Partners Oy (ca. 37.8%) and Yrittävä Suupohja Oy (38.5%) as associated companies.
Ilkka-Yhtymä Oyj is a limited company, which in terms of decision-making and administration adheres to the Finnish Companies Act, other regulations concerning quoted companies, its Articles of Association, and the recommendations and guidelines issued by NASDAQ OMX Helsinki Oy.
Ilkka-Yhtymä Oyj complies with the Finnish Corporate Governance Code for listed companies that was issued by the Securities Market Association on 15 June 2010 and which came into force on 1 October 2010. Any divergences from these recommendations have been listed separately.
Ilkka-Yhtymä Oyj operates a two-tier administrative model. The Annual General Meeting elects the members of the Supervisory Board and the Supervisory Board elects the members of the Board of Directors.
THE ANNUAL GENERAL MEETING
The Annual General Meeting is held yearly before the end of June. According to Ilkka-Yhtymä Oyj's Articles of Association, the Supervisory Board summons the AGM and makes statements on issues to be presented at the meeting. Ilkka-Yhtymä Oyj usually holds its AGM in March or April.
The following issues are discussed at the AGM:
- the Board of Directors' Report, including the financial statements for the previous financial year, as well as the auditor's report
- adoption of the financial statements
- discharge the Supervisory Board, the Board of Directors and the Managing Director from liability
- measures warranted by the profit or loss recorded on the adopted balance sheet
- determining the remuneration of the members of the Supervisory Board and the auditors
- electing members of the Supervisory Board replacing those whose terms as members are about to expire and electing the auditors
- other issues mentioned in the invitation to the meeting.
In addition, the AGM elects one auditor, which must be an Authorised Public Accountant firm approved by the Central Chamber of Commerce.
Shareholders are summoned to a General Meeting no more than three months (3) and no less than three (3) weeks prior to the General Meeting, with a notice of the General Meeting for shareholders, published in a newspaper published by the company or its subsidiary, as well as in the form of a stock exchange release and on the corporate website. However, the notice of the General Meeting is published a minimum of nine (9) days prior to the matching date of the General Meeting. The Annual Report is available from Ilkka-Yhtymä Oyj's financial services department no later than one week prior to the AGM, and is also available on the Group's website.
If a shareholder wishes to present an issue to the AGM, he or she must present it in writing to the Supervisory Board in sufficient time that it may be included in the Notice of Annual General Meeting. All shareholders who, on the record date separately announced by the company, were registered in the Shareholders Register maintained by Euroclear Finland Oy are entitled to attend the AGM. Those shareholders wishing to attend the AGM must register in advance by the final date given in the Notice of Annual General Meeting, which can be no earlier than ten (10) days prior to the meeting.
According to the Articles of Association, a single shareholder at a General Meeting may not use more than one twentieth (1/20) of the entire number of votes represented in a meeting. The goal is that all members of the Board of Directors be present at the Annual General Meeting.
Deviation from Finnish Corporate Governance Recommendations 4 and 11: No director candidatures are published in the notice of general meeting since the members of the Board of Directors are elected by the Supervisory Board (Section 7 of the Articles of Association). For the same reason, first-time candidates will not necessarily participate in the general meeting.
SUPERVISORY BOARD
According to Ilkka-Yhtymä Oyj's Articles of Association, the Company has a Supervisory Board with a minimum of twenty (20) and a maximum of thirty (30) members, two of which must be employees of the Group. The members of the Supervisory Board are elected at the AGM for a term of office of four (4) years at a time, beginning immediately after their election.
Annual Report 2014
ADMINISTRATION
The duties of the Supervisory Board include supervising the company's management and the way it conducts its business, electing and discharging the members of the company's Board of Directors and determining their remuneration, calling meetings of the AGM, and issuing statements on issues presented to the AGM. The Supervisory Board appoints a four-person Compensation and Nomination Committee, which comprises the Chairmen and Deputy Chairmen of the Supervisory Board and the Board of Directors of Ilkka-Yhtymä Oyj, and the Head of HR, who acts as secretary.
Deviation from Finnish Corporate Governance Recommendation 8: Ilkka-Yhtymä has a so-called two-tier management model. The general meeting elects the members of the Supervisory Board, while the Supervisory Board elects the Board of Directors. Due to the nature of the publishing sector, interaction with the circulation area and other owners is of great importance. This interaction is enabled through the Supervisory Board, which allows the Board of Directors to be small and efficient.
The Supervisory Board convened twice during 2014. Average attendance at meetings was 84%. The Chairman and members of Ilkka-Yhtymä Oyj's Supervisory Board were paid a total of EUR 39,200 in monthly and meeting fees.
The AGM on 24 April 2014 determined Supervisory Board emoluments for 2014 as follows:
- Chairman's fee EUR 1,500/month plus the standard meeting fee of EUR 400/meeting.
- Meeting fee for members - EUR 400/meeting
BOARD OF DIRECTORS
According to the Articles of Association, the duties of the Supervisory Board of Ilkka-Yhtymä Oyj include electing and dismissing members of the company's Board of Directors and determining their remuneration. At the first meeting of the Supervisory
Board following the AGM, members are elected to replace those whose membership of the Board is about to expire.
The Board of Directors comprises a minimum of four (4) and a maximum of six (6) members. Currently, the Board of Directors has six members. Board members are elected for a term of four (4) years.
Deviation from Finnish Corporate Governance Recommendation 8: The AGM does not elect the members of the Board of Directors, as according to Ilkka Yhtymä Oyj's Articles of Association, the company's Supervisory Board is responsible for electing and discharging the members of the Board of Directors and for determining their remuneration. An election to replace the Board's outgoing members is held at the Supervisory Board's first meeting after the AGM.
Deviation from Finnish Corporate Governance Recommendation 10: Under the Articles of Association, the members of the Board of Directors are elected for a term of four (4) years. In view of the continuity of operations and the regional dimension, term of office is set to exceed one year.
Deviation from Finnish Corporate Governance Recommendation 11: Proposed candidates for the Board of Directors are not included in the Notice of Annual General Meeting, as the members of the Board of Directors are chosen by the Supervisory Board, which meets after the AGM.
Deviation from Finnish Corporate Governance Recommendation 12: Under the Articles of Association, the members of the Board are elected by the Supervisory Board meeting held subsequent to the Annual General Meeting. The Articles of Association do not specify a special order of appointment of the directors.
According to the Articles of Association, the tasks of the Board of Directors include supervising the company's management and
the way it conducts its business, appointing and discharging the Managing Director and the Managing Director's immediate subordinates, ensuring that decisions of General Meetings and the Supervisory Board are implemented, supervising the company's finances and accounting, and granting and revoking procuration.
The Chairman of the Supervisory Board has the right to participate in Board meetings and present his opinion.
According to the standing order, the Board of Directors executes the following, inter alia:
- confirms its own standing order, which is reviewed annually
- considers and approves the Group's strategy, ensures that it remains abreast of the latest developments, approves corporate annual plans, budgets and the staff incentive scheme on the basis of the strategy, and supervises their implementation
- confirms the basic structure of the group's organisation and the group's values
- goes through the main risks related to the companies' operations on an annual basis alongside its consideration of the corporate strategy
- considers and approves the interim reports, the Board of Directors' Report and the financial statements
- meets with the auditors once a year
- defines the company's profit-distribution policy (including the dividend policy)
- appoints the Group Executive Team and the Extended Group Executive Team and the members of the functions' Executive Teams as proposed by the Managing Director
- decides on exceptionally broad issues which do not form part of the everyday operative management of the company
- based on approval clause of §3 of the Articles of Association, approves the transfer of series I shares to the shareholder register
- considers any other issues the Managing Director and the Chairman of the Board of Directors believe warrant their attention.
Annual Report 2014
ADMINISTRATION
The Board of Directors of Ilkka-Yhtymä Oyj has analysed the independence of its members. On the basis of the evaluation, it was stated that the entire Board of Directors is independent of the company and of the significant shareholder as defined by the Finnish Corporate Governance Code. The Board is as follows: Seppo Paatelainen, Chairman (until 5 May 2014); Timo Aukia, Vice Chairman (until 5 May 2014), Chairman (from 5 May 2014); Esa Lager, member, Vice Chairman (from 5 May 2014); and members Markku Hautanen (from 5 May 2014), Sari Mutka, Tapio Savola and Riitta Viitala.
In 2014, the Board of Directors held 15 meetings, including 2 teleconferences with an average participation of 98.9%. The Board of Directors conducts an internal self-assessment of its activities and working methods once a year.
There are at least 12 meetings of the Board of Directors each year. Issues considered at meetings include the financial statements and interim reports, and the monthly reports of the group's and group's subsidiaries. The Board of Directors convenes at least once a year for a strategy meeting, and confirms the plan of action and budget for the following year, at which time it also confirms investments for the coming year. Taking into consideration the size of the group and its field of business, it is fairly easy for members of the Board of Directors to develop an overall-view of the company's structure, business operations and markets.
The Managing Director functions as rapporteur at Board meetings and, if necessary, other members of the company's management can function as additional rapporteurs on the Managing Director's invitation, with regard to their expert tasks. The majority of the members of the subsidiary companies' Boards of Directors are members of the Board of Directors of the parent company.
The Supervisory Board decided at its meeting on 5 May 2014 on the Board of Directors of Ilkka-Yhtymä Oyj's emoluments for 2014 as follows:
- The Chairman's remuneration is EUR 2,500/month plus the standard fee of EUR 400/meeting.
- Vice Chairman's remuneration is EUR 1,500/month plus the standard fee of EUR 400/meeting.
- Remuneration for members is EUR 1200/month plus the standard fee of EUR 400/meeting.
A total of EUR 158,510 (Group) was paid in monthly and meeting fees to the members of the Board of Directors of Ilkka-Yhtymä Oyj in 2014. The Board's remuneration has never been paid in own shares, nor have the share-based incentive schemes used for rewarding the members of Board of Directors.
COMPENSATION AND NOMINATION COMMITTEE
The Supervisory Board and Board of Directors have appointed a four-person Compensation and Nomination Committee to handle certain preparatory tasks. The Committee, which is set by the Supervisory Board, comprises the Chairman and Deputy Chairmen of the Supervisory Board and the Board of Directors of Ilkka-Yhtymä Oyj, and the Head of HR, who acts as secretary. The Compensation and Nomination Committee meets at least twice a year, or as required. The Committee met three times in 2014. Remuneration for members is EUR 400/meeting. Remuneration is not paid if the meeting is on the same day that the meeting of the Board of Directors and/or Supervisory Board. Average attendance at meetings was 92%.
Deviation from Finnish Corporate Governance Recommendation 22: The Board of Directors does not elect the members of the Compensation and Nomination Committee, since the company has a Supervisory Board which appoints said committee.
The Compensation and Nomination Committee prepares and presents the following for consideration and approval by the relevant body:
- To the Annual General Meeting: new members to be elected to the Supervisory Board to replace the outgoing members
- To the Supervisory Board: new members to be elected to the Board of Directors to replace the outgoing members
- Chairmen of the Supervisory Board and Board of Directors
- Compensation for the Chairmen and members of the Supervisory Board and Board of Directors
- Members and compensation of the Boards of Directors of Group subsidiaries
- The profit-related incentive scheme for Group personnel
- The salary and other benefits of the Group's Managing Director and his immediate subordinates
- The written contract of the Managing Director of Ilkka-Yhtymä Oyj
- The performance-related incentive scheme for the extended Group Executive Team
- The choice of auditors and deputy auditors
No other committees have been appointed.
GOVERNING BODY IN CHARGE OF AUDIT COMMITTEE DUTIES
Deviation from the Finnish Corporate Governance recommendation 24, 25, 26, 27: Ilkka-Yhtymä has not established an audit committee. Considering the company's business sector, home market-orientation and the extensiveness of its operations, the Board has been deemed as having the opportunity to familiarise itself with the matters relating to finance and control while also managing communications with the auditors.
Ilkka-Yhtymä does not appoint an audit committee; the Board of Directors of the company is in charge of the related duties. On an annual basis, decisions of greater scope are taken alongside the Authorised Public Accountant, which the Authorised Public Accountant then analyses and reports to the Chairman of the Board of Directors and the Managing Director. The
Annual Report 2014
ADMINISTRATION
essential sections of the report are discussed at Board of Directors' meetings.
MANAGING DIRECTOR
The Managing Director of Ilkka-Yhtymä Oyj is also the Managing Director of the Group and is responsible for the operations of the entire Group in line with the aims and instructions issued and approved by its Board of Directors. As the Managing Director of Ilkka-Yhtymä Oyj, the Managing Director of the group is in charge of the company's day-to-day administration and the achievement of its goals, as well as preparing issues in line with instructions issued by the Board of Directors. The Managing Director of the subsidiary, function managers as well as appointed persons in charge of units report to the Group Managing Director. The Group Managing Director is assisted by the Group Executive Team, proposed by the Managing Director and appointed by the Group's Board of Directors.
The Managing Director and the Group's extended Executive Team are covered by the Group's general profit-related incentive scheme. The profit-related bonus is based on the target gross margin approved by the Board of Directors and company-specific scorecard targets.
The Managing Director and the Group's extended Executive Team are also covered by a performance-related incentive scheme, annually determined by the Board. The performance-related bonus depends on attaining operational targets, set by the Board for each financial year and supporting both a short- and long-term strategy of profitable growth. The potential bonus is paid into the voluntary, defined-contribution group pension plan. In this voluntary plan, the retirement age is defined at 60 years, at which time the payment of pension contributions will end. The pension is determined based on the amount of pension savings accrued by the date on which the pension begins. Under the terms and conditions of the group pension plan for the Managing Director and Executive Team members, the insured is entitled to a vested pension i.e.
paid-up pension insurance corresponding to the pension savings accrued by the end of the employment contract. This vested pension includes old-age pension after the retirement age, as well as disability and life cover. The retirement age of the Managing Director and the Group's extended Executive Team has not been agreed.
The maximum amount of bonuses is a sum equalling 4 months' salary. The Group applies no incentive scheme based on rewarding the management with the company's own shares.
The terms and conditions of the Managing Director's employment are defined in a written executive contract. The Managing Director's retirement age will be determined by the prevailing old-age pension system. In the case of dismissal by the company, the Managing Director's period of notice is 6 months before the age of 63, in addition to which the company will pay severance pay equalling 18 months' salary. Severance pay equals 24 months' salary in the event of a merger or other business reorganisation. In the case of resignation, the Managing Director's period of notice is 6 months.
In 2014, Managing Director Matti Korkiatupa was paid a total of EUR 309,314 in salary and fringe benefits and EUR 52,857 in pension contributions to a voluntary defined-contribution group pension plan.
GROUP EXECUTIVE TEAM
The Group Executive Team supports the Managing Director in steering and developing the group's business in pursuit of the strategic goals presented by the team and approved by the Board of Directors. The actual Group Executive Team comprises the parent company's Managing Director in the role of Chairman, the Financial Director and Head of HR, the Managing Director of I-print Oy, and the Chairman of the I-Mediat Oy editorial function's Executive Team (alternately the Editor-in-Chief of Ilkka or Pohjalainen). The Group Executive Assistant serves as the secretary to the Executive Team. In addition to the above, the
Group's extended Executive Team includes the Director in charge of provincial papers consumer marketing; the Director in charge of provincial papers corporate marketing; Editor-in-Chief of Ilkka or Pohjalainen; the Director of web and mobile operations; the Local Newspaper Director, the Head of Marketing for the Printing House; and the parent company's Development and Data Administration Manager. The duties of the Group's Executive Team are determined in the operating instructions, approved by the Board of Directors.
The Group Executive Team falls under the Group's incentive scheme. Incentive bonuses are based on the target gross margin approved by the Board of Directors and company-specific Balanced Scorecard objectives. Moreover the Group's extended Executive Team is covered by an incentive scheme, annually determined by the Board of Directors.
In 2014, the Group's Executive Team convened 11 times, including 6 occasions involving the Group's extended Executive Team. The subsidiaries have their own Executive Teams, meetings of which are attended by the Managing Director of the parent company.
INTERNAL CONTROL, RISK MANAGEMENT AND INTERNAL AUDITORS
Internal control is implemented according to the operating instructions and principles prepared by the management and approved by the Board of Directors. The Group monitors the attainment of objectives using the agreed reporting systems. In its meetings, the Board of Directors considers, for instance, the financial statements, interim reports and the Group's and subsidiaries' monthly reports. At least once a year, the Board of Directors also holds a strategy meeting. The Board of Directors confirms business plans and investments for the following year. Considering the Group's size and business sector, it is relatively easy for Board members to gain an overall view of the company's structure, business, markets and level of internal control.
Annual Report 2014 | 85
ADMINISTRATION
The Board of Directors has approved the Risk Management Policy of Ilkka-Yhtymä, which includes all essential items for implementing comprehensive risk management. The Risk Management Policy serves as the foundation for all of the Group's risk management documentation and its practical implementation, and is part of the Group's management system approved by the Board of Directors. Supporting a jointly agreed vision and the strategy derived thereof, the policy contributes to ensuring that the long-term business goals are achieved, enabling Ilkka-Yhtymä to be an attractive and successful communications group embracing the spirit of our times.
The Risk Management Policy includes a written document and descriptions of key risks and the related management measures defined in separate risk databases. For identified key risks, risk management responsibilities have been defined by function, by profit centre, by subsidiary and at Group level, and those assigned as being responsible thereof have the capabilities required for risk management tasks. The Group's risk management procedures are consistent and known to the staff participating in holistic risk management.
Considering the nature and extent of Ilkka-Yhtymä Oyj's business, the Group does not sustain a separate internal audit department, but this fact is taken into account in the auditors' audit plan. Every year, the company agrees with the audit firm on the closer assessment of larger entities and on reporting the audit findings to the company's Managing Director and the Chairman of the Board of Directors. Subsequently, the Board of Directors will review the report's most important sections.
INSIDER ADMINISTRATION
In accordance with Insider standard 5.3. regulations of the Securities Market Act, statutory insiders in Ilkka-Yhtymä Oyj include the members of the Board of Directors and the Supervisory Board, the Managing Director and the auditors. In addition to the above-mentioned statutory insiders, according to a decision by the Board of Directors, permanent public insiders include the members of the Group Executive Team and the members of the Extended Group Executive Team. The company-specific insiders of Ilkka-Yhtymä Oyj include members of the subsidiaries' Executive Teams; some members of certain functions' and profit centres' Executive Teams; the Executive Assistant at the parent company; and employees from the Group's financial department. When necessary, a project-specific insider register will be maintained concerning large or otherwise significant projects. The Group's Financial Director is responsible for insider administration.
Ilkka-Yhtymä Oyj complies with the Guidelines for Insiders adopted by the NASDAQ OMX Helsinki Ltd., the Central Chamber of Commerce and the Confederation of Finnish Industries EK. In addition, the Board of Directors has adopted insider information guidelines for Ilkka-Yhtymä Oy. These guidelines have been distributed to all of the company's insiders, together with a guide for insiders published by the Finnish Foundation for Share Promotion. Starting from 1 January 2009, the Board of Directors has set the duration of the so-called "closed window" at four (4) weeks, i.e. insiders may not trade in Ilkka-Yhtymä Oyj shares four weeks prior to the publication of the financial accounts and interim reports.
Insiders are obliged to inform the keeper of Ilkka-Yhtymä Oyj's insider register (Management Assistant Petra Rintala) of any changes in the information recorded in the register within seven (7) days. The register keeper also annually sends the insiders extracts of the information in the register for verification. The company examines trading by insiders at least once a year.
Information on the holdings of the public insiders of Ilkka-Yhtymä Oyj is available on our website at www.ilkka-yhtyma.fi. The information contained in Ilkka-Yhtymä's insider register is also available at the service desk of Euroclear Finland Oy, Urho Kekkosen katu 5 C, 8th floor, FI-00100 Helsinki.
In 2015, the closed window periods are set at 19 January-16 February 2015 for the publication of the financial statements bulletin for 2014 and, for the interim reports for 2015, 6 April-4 May 2015, 6 July-3 August 2015 and 5 October -2 November 2015. The corresponding periods for 2014 were 20 January-17 February 2014 for the publication of the financial statements bulletin for 2013 and, for the interim reports for 2014, 7 April-5 May 2014, 7 July-4 August 2014 and 6 October -3 November 2014.
AUDITING OF THE ACCOUNTS
The company has one auditor, which must be an Authorised Public Accountant firm approved by the Central Chamber of Commerce.
The 2014 AGM of Ilkka-Yhtymä Oyj elected Ernst & Young Oy, Authorised Public Accountants, as the auditor, with Harri Pärssinen, Authorised Public Accountant, as the principal auditor. The supervisory audit was performed by Ernst & Young Oy, Authorised Public Accountants.
In 2014, for the auditing of Ilkka-Yhtymä Group's companies, the following fees were paid to Ernst & Young Oy: EUR 60 thousand for auditing and EUR 14 thousand for other services.
COMMUNICATIONS
The Managing Director of Ilkka-Yhtymä Oyj is responsible for Group's external communications. The Ilkka-Yhtymä Group's investor and media relations are handled by the Group's financial administration department under the direction of the Managing Director. The Group's financial administration department is also responsible for online investor information and stock exchange bulletins.
SHAREHOLDERS' AGREEMENTS
Ilkka-Yhtymä Oyj is not aware of any shareholders' agreements regarding the company.
Annual Report 2014
ADMINISTRATION
Supervisory Board
The Supervisory Board convened twice during the year. In 2014, its number of members was 25, including two employee representatives.
| Member of the Supervisory Board since | Current term will expire in | |
|---|---|---|
| Chairman | ||
| Lasse Hautala, Kauhajoki | ||
| Member of Parliament | 2010 | 2015 |
| Vice Chairman | ||
| Perttu Rinta, Mikkeli | ||
| Managing Director, Suur-Savon Sähkö Oy | 1999 | 2015 |
| Markku Akonniemi, Töysä | ||
| Farmer | 1985 | 2017 |
| Kari Aukia, Vaasa | ||
| Entrepreneur, Kari Aukia Oy | 2006 | 2018 |
| Sami Eerola, Nurmo | ||
| Agricultural entrepreneur | 2008 | 2018 |
| Jari Eklund, Helsinki | ||
| Group Director, member of the Board of Directors, | ||
| LocalTapiola General Mutual Insurance Company | 1998 | 2018 |
| Terhi Ekola*, Vaasa | ||
| Journalist, I-Mediat Oy | 2013 | 2017 |
| Juhani Hautamäki, Ylivieska | 2009 | 2017 |
| Satu Heikkilä, Helsinki | 2010 | 2015 |
| Heikki Järvi-Laturi, Teuva | ||
| Farmer | 2001 | 2017 |
| Vesa-Pekka Kangaskorpi, Jyväskylä | ||
| Managing Director, Keskisuomalainen Oyj | 2000 | 2016 |
| Johanna Kankaanpää, Ähtäri | ||
| Chairman of the Board, | ||
| MTK in South Ostrobothnia | 2008 | 2018 |
| Yrjö Kopra, Helsinki | ||
| Managing Director, | ||
| Alexander Corporate Finance Oy | 1998 | 2018 |
| Petri Latva-Rasku, Tampere | ||
| Entrepreneur, Quha Oy | 2007 | 2017 |
| Juha Mikkilä, Kurikka | ||
| Business College Graduate, agricultural | ||
| and forestry entrepreneur | 1990 | 2018 |
| Member of the Supervisory Board since | Current term will expire in | |
| --- | --- | --- |
| Ari Rinta-Jouppi, Vähäkyrö | ||
| Managing Director, Rauno Rinta-Jouppi Oy | 1999 | 2015 |
| Jarmo Rinta-Jouppi, Seinäjoki | ||
| Managing Director, Jarmo Rinta-Jouppi Oy | 2004 | 2016 |
| Minna Sillanpää, Seinäjoki | ||
| Managing Director, Jarmo Rinta-Jouppi Oy | 2011 | 2015 |
| Minna Silanpää, Seinäjoki | ||
| Managing Director, The Regional Organization | ||
| of Enterprises in South Ostrobothnia | 2004 | 2016 |
| Kimmo Simberg, Seinäjoki | ||
| Managing Director, | ||
| Etelä-Pohjanmaan Osuuskauppa | 2004 | 2016 |
| Sami Talso, Mustasaari | ||
| Managing Director, Talso Oy | 2008 | 2018 |
| Raija Tikkala, Jurva | ||
| Managing Director, Social Insurance Institution | 1995 | 2015 |
| Marja Vettenranta, Laihia | ||
| Study Coordinator, University of Vaasa | 1997 | 2017 |
| Jorma Vierula, Seinäjoki | ||
| Regional Director, Finnish Forest Centre | 2011 | 2015 |
| Jyrki Viitala, Seinäjoki | ||
| Managing Director, Seinäjoen Käyttöauto Oy | 2000 | 2016 |
| Niina Vuolio*, Seinäjoki | ||
| Service Advisor, I-Mediat Oy | 2013 | 2017 |
| *) Employee representative | ||
| Employees are represented on the Supervisory Board of Ilkka-Yhtymä Oyj. | ||
| Remunerations in 2014: | ||
| For the Chairman, EUR 1,500 per month and a standard fee of EUR 400 per meeting. For each member, a standard fee of EUR 400 per meeting. |
Annual Report 2014 | 87
ADMINISTRATION
The Board of Directors of Ilkka-Yhtymä Oyj 2014: Tapio Savola, Esa Lager, Riitta Viitala, Timo Aukia, Sari Mutka and Markku Hautanen.
Board of Directors
| Member of the Board of Directors since | Expiry of current term | |
|---|---|---|
| Timo Aukia, Managing Director, Tampere, Chairman | 2007 | 2016 |
| Esa Lager, M.Sc. (Econ.), LL.M., Kauniainen, Vice Chairman | 2011 | 2018 |
| Markku Hautanen, Managing Director, Seinäjoki | 2014 | 2015 |
| Sari Mutka, Development Manager, Kauniainen | 2007 | 2017 |
| Tapio Savola, Master of Laws trained on the bench, Lappajärvi | 1991 | 2015 |
| Riitta Viitala, PhD (econ.), Professor, Vaasa | 2010 | 2018 |
Annual Report 2014
ADMINISTRATION
SEPPO PAATELAINEN
Chairman of the Board of Directors until 5 May 2014
Born in 1944, M.Sc. (Agr. & For.), Vuorineuvos (Finnish honorary title), Suonenjoki
Ilkka-Yhtymä Oyj, Chairman of the Board of Directors 2007-5 May 2014.
Emoluments in 2014 (Group): EUR 16,750
TIMO AUKIA
Chairman of the Board of Directors since 5 May 2014
Born in 1973, M.Sc. (Econ.), Managing Director, Tampere
Ilkka-Yhtymä Oyj, Vice Chairman of the Board of Directors 2007-2014, current term ending in 2016.
Ilkka-Yhtymä Oyj, member of the Supervisory Board, 1999-2007
Board of Directors membership in the following Group subsidiaries:
- I-Mediat Oy, Chairman since 2014, (Vice Chairman of the Board 2010-2014)
- I-print Oy, since 2007
Board of Directors membership in the following companies:
- Alma Media Corporation, 2011-2014
Managing Director of Timo Aukia Oy since 1999
Managing Director of Jaakko Aukia Oy since 2012
Shareholdings: 179,727 shares
Emoluments in 2014 (Group): EUR 42,700
ESA LAGER
Vice Chairman of the Board of Directors since 5 May 2014
Born in 1959, M.Sc. (Econ.), LL.M., Kauniainen
Ilkka-Yhtymä Oyj, member of the Board of Directors since 2011, current term ending in 2018.
Board of Directors membership in the following Group subsidiaries:
- I-Mediat Oy, since 2011
Board of Directors membership in the following companies:
- Sato Corporation, Chairman since 3/2015, Vice Chairman of the Board 3/2014-3/2015
- Olvi Oyj, Vice Chairman since 2002
- Alma Media Corporation since 3/2014
- Finnish Industry Investment Ltd since 3/2014
- Fennovoima Ltd, since 4/2014
- Subsidiaries of Outokumpu Group until the end of 2013
Previously Chief Financial Officer (CFO) at Outokumpu Oyj 2005-2013 and deputy to the CEO at Outokumpu Oyj 2011-2013
Shareholdings: 8,000 shares
Emoluments in 2014 (Group): EUR 29,520
MARKKU HAUTANEN
Born in 1960, M.Sc. (Econ.), Managing Director, Seinäjoki
Ilkka-Yhtymä Oyj, member of the Board of Directors since 5/2014, current term ending in 2015.
Board of Directors membership in the following Group subsidiaries:
- I-Mediat Oy, since 2014
Board of Directors membership in the following companies:
- Härmämedi Oy, since 2012
- Härmän Kuntoutus Oy, since 2011
Currently Managing Director of Skaala Group
Shareholdings: -
Emoluments in 2014 (Group): EUR 12,340
SARI MUTKA
Born in 1968, M.Sc. (Econ.), Development Manager, Kauniainen
Ilkka-Yhtymä Oyj, member of the Board of Directors since 2007, current term ending in 2017.
Ilkka-Yhtymä Oyj, member of the Supervisory Board, 2002-2007
Board of Directors membership in the following Group subsidiaries:
- I-Mediat Oy, since 2010
Development Manager at Uusimaa's ELY centre since 2012
Previously Business Consultant at Uusimaa's ELY centre 2009-2011 and Financial Administration employee at FIM Oyj, 2004-2008
Shareholdings: 96,287 shares
Emoluments in 2014 (Group): EUR 19,200
TAPIO SAVOLA
Born in 1959, LL.M., Master of Laws trained on the bench, Lappajärvi
Ilkka-Yhtymä Oyj, member of the Board of Directors since 1991, current term ending in 2015.
Board of Directors membership in the following Group subsidiaries:
- I-Mediat Oy since 2010
Board of Directors membership in the following companies:
- Keski-Pohjanmaan Kirjapaino Oyj since 2009
- Keski-Pohjanmaan Viestintäytymä Oy since 2009
Currently Lawyer at Lakiasiaintoimisto Savola & Savola
Shareholdings: 4,073 shares
Emoluments in 2014 (Group): EUR 19,200
RIITTA VIITALA
Born in 1959, PhD (Econ.), Professor, Vaasa
Ilkka-Yhtymä Oyj, member of the Board of Directors since 2010, current term ending in 2018.
Board of Directors membership in the following Group subsidiaries:
- I-Mediat Oy, since 2010
Board of Directors membership in the following companies:
- Vacon Oyj, 2008-2015
- Ostrobothnia Chamber of Commerce, Vaasa Department, since 2009
Currently Professor at Department of Management, University of Vaasa.
Shareholdings: -
Emoluments in 2014 (Group): EUR 18,800
Managing Director
MATTI KORKIATUPA
Born in 1955, M.Sc. (Agr. & For.), Seinäjoki
Managing Director of Ilkka-Yhtymä Oyj since 1999
Board of Directors membership in the following Group subsidiaries:
- I-print Oy, Chairman since 2007, member of the Board of Directors since 1999
Main positions of trust:
- Arena Partners Oy, Chairman 2000-2004 and since 2010, member of Board of Directors since 2000
- Alma Mediapartners Oy, member of the Board of Directors since 2010
- Lännen Media Oy, member of the Board of Directors since 2014
- Finnish Newspaper Association, member of the Board since 2000, Chairman 2011-2013,
- Anvia Oyj, member of the Board of Directors, 2007-2014
- Board member at WAN-IFRA, 2009-2014
- Confederation of Finnish Industries, Chairman of Regional Board, 2011-2014, member 2005-2014
Previously, for instance, Regional Manager at Tapiola Group, 1992-1998.
Auditors
Ernst & Young Oy,
Authorised Public Accountants
Harri Pärssinen,
Authorised Public Accountant
Annual Report 2014 | 89
ADMINISTRATION
The Extended Group Executive Team of Ilkka-Yhtymä Group 2014: Olli Pirhonen, Satu Takala, Ari Monni, Seppo Lahti, Matti Korkiatupa, Anna-Maija Uitta, Hannu Uusihauta, Paula Mahlamäki, Marko Orpana, Toni Viljanmaa, Päivi Sairo and Sauli Harjamäki.
Group Executive Team
The Group Executive Team convened 11 times in 2014.
MATTI KORKIATUPA
Ilkka-Yhtymä Oyj, Managing Director since 1999
Born in 1955, M.Sc. (Agr. & For.)
Chairman of the Group Executive Team
Shareholdings: 12,521 shares
OLLI PIRHONEN
Ilkka-Yhtymä Oyj, Financial Director 3/2014-
Born in 1970, M.Sc. (Econ.)
Ilkka-Yhtymä Oyj, secretary of the Board of Directors
Ilkka-Yhtymä Oyj, deputy to the Managing Director since 2015
Previous experience includes:
- Group Controller at Atria Plc, 2007-2014 and Finance Manager, for instance, at Atria Group, 1998-2007
Shareholdings: -
SEPPO LAHTI
I-print Oy, Managing Director since 2003 Born in 1963, M.Sc. (Eng.)
Previous experience includes:
- Oy Metsäbotnia Ab, Customer Service Manager, Brand Manager and Technical Support Manager, 1995-2003
- Veitsiluoto Oy, R&D engineer, 1989-1994
Shareholdings: -
PAULA MAHLAMÄKI
Ilkka-Yhtymä Oyj, Head of HR since 1991 Born in 1954, M.Sc. (Econ.)
Ilkka-Yhtymä Oyj, deputy to the Managing Director 3-12/2014
Previous experience includes:
- Era-Pak Ky, Office Manager, 1979-1990
Shareholdings: 2,075 shares
SATU TAKALA
I-Mediat Oy, Editor-in-Chief of Ilkka since 8/2012, the Chairman of the editorial function's Executive Team and member of the Group Executive Team since 9/2013 Born in 1973, Master of Arts, Forestry Engineer
Main positions of trust:
- Väli-Suomen Media Oy, member of the Board, 2012-2014
Previous experience includes:
- Managing Editor of the shared editorial unit of Ilkka and Pohjalainen 2010-2012
- Managing Director of Väli-Suomen Media Oy and Producer for Sunnuntaisuomalainen 2007-2010
- Editor for Ilkka 2000-2007
Shareholdings: -
Annual Report 2014
ADMINISTRATION
Extended Group Executive Team (in addition to the aforementioned)
The Extended Group Executive Team convened 6 times in 2014.
SAULI HARJAMÄKI
I-Mediat Oy, Director in charge of Local Newspapers since 1990
Born in 1958, D.Sc. (Econ.)
Main positions of trust:
- KaupunkiPlus Oy, member of the Board of Directors since 2008
- Yrittävä Suupohja Oy, member of the Board of Directors since 1992
- Etelä-Pohjanmaan Uusyrityskeskus Neuvoa-Antava, member of the Board of Directors since 1999
Previous experience includes:
- Pohjanmaan Paikallistelevisio Oy, Managing Director, 1991-2002
- Sento Oy Högfors, Regional Director, 1988-1990
Shareholdings: -
ARI MONNI
Ilkka-Yhtymä Oyj, Data Administration and Development Manager since 1994
Born in 1958, B.Sc. (Eng.)
Main positions of trust:
- Arena Interactive Oy, member of the Board since 2007
- South Ostrobothnia Chamber of Commerce, member of the ICT Committee since 2005
- Centre for Economic Development, Transport and the Environment of western Finland, ICT-committee of preparedness in Ostrobothnia, member since 2009
- LocalTapiola Ostrobothnia, member of the Board of Directors since 2013
Previous experience includes:
- Oy Seinäjoki (the paper Etelä-Pohjanmaa), Managing Director in addition to his regular duties, 1993-1994
- Vaasa Oy Seinäjoen Kirjapaino, Print shop Manager, 1987-1994
- Vaasa Oy Kirjapaino, Production Manager, 1985-1987
Shareholdings: 167 shares
MARKO ORPANA
I-Mediat Oy, Director in charge of web and mobile business operations since 2007
Born in 1971, M.Sc. (Econ.)
Main positions of trust:
- Rauhala Yhtiöt Oy, member of the Board since 2012
- Arena Partners, Chairman of the e-Business Group, since 2009
Previous experience includes:
- Itella Information, Sales and Marketing Director, Finland, 2003-2007
Shareholdings: 500 shares
PÄIVI SAIRO
I-Mediat Oy, Director in charge of the provincial newspapers' consumer marketing and sales and of coordinating Pohjalainen's operations since 2010
Born in 1956, M.Sc. (Econ.)
Main positions of trust:
- Kova Login Ab Oy, member of the Board since 2012
- Ostrobothnia Chamber of Commerce, member of the Industry Committee since 2010
Previous experience includes:
- Nordea, Bank Manager, 1986-2000
Shareholdings: 4,221 shares
ANNA-MAIJA UITTO
I-print Oy, Marketing Manager
2001-3/2015
Born in 1952, Correspondent
Previous experience includes:
- Etelä-Pohjanmaan Messut Oy, Managing Director, 1999 - 2000
- South Ostrobothnia Chamber of Commerce, Assistant Director, 1995-1999
Shareholdings: -
HANNU UUSIHAUTA
I-Mediat Oy, Director in charge of the provincial newspapers' and free sheets' corporate marketing and of coordinating Ilkka's operations since 2010
Born in 1956, Business College Graduate
Previous experience includes:
- If P&C Insurance Company Ltd, Sales Director, 2001-2002
- Sampo-Leonia/Sampo Bank, Regional Director, 2000-2001
- Sampo Insurance Company Ltd, Office Director, 1988-2000
- Sampo Mutual Insurance Company Ltd, Office Manager, 1980-1988
Shareholdings: -
TONI VILJANMAA
I-Mediat Oy, Editor-in-Chief of Pohjalainen since 2/2014
Born in 1976, MA
Previous experience includes:
- Politics reporter for Alma Regional Media's Helsinki-based shared editorial department, 2008-2013
- Chief Editor of Tyrvään Sanomat, 2005-2008
- Posts at the Ministry for Foreign Affairs of Finland, for instance at Europe Information, 2003-2004
Shareholdings: -
Annual Report 2014 | 91
ILKKA-YHTYMÄ GROUP
THE GROUP'S PARENT COMPANY
ILKKA-YHTYMÄ
Ilkka-Yhtymä Oyj
Managing Director Matti Korkiatupa
I-MEDIAT OY
Managing Director Matti Korkiatupa
PROVINCIAL PAPERS
ILKKA
Chief Editor
Satu Takala
POHJALAINEN
Chief Editor
Toni Viljanmaa
FREE SHEETS
Etelä-Pohjanmaa, Vaasan Ikkuna
LOCAL NEWSPAPERS
Jurvan Sanomat, Järviseutu,
Komiat, Suupohjan Sanomat, Viiskunta
Corporate Marketing: Hannu Uusihauta, Director
Consumer Marketing: Päivi Sairo, Director
Web and Mobile Business: Marko Orpana, Director
Local newspapers: Sauli Harjamäki, Director
I-PRINT OY
Managing Director Seppo Lahti
Newspaper printing, Printing house,
Communications agency I-print | plus
Kiinteistö Oy Seinäjoen Koulukatu 10
Seinäjoen Kassatalo Osakeyhtiö
Pohjalaismediat Oy
THE PARENT COMPANY PROVIDES THE SUBSIDIARIES WITH:
Financial and investment services: Olli Pirhonen, Financial Director
HR services: Paula Mahlamäki, Human Resources Manager
Development and data management services: Ari Monni, Development and Data Administration Manager
Real-estate services: Heikki Lehtola, Construction Engineer
Annual Report 2014
ILKKA-YHTYMÄ GROUP
ILKKA-YHTYMÄ OYJ
Koulukatu 10
P.O.Box 60
FIN-60101 SEINÄJOKI
Tel. +358 6 247 7100
Fax +358 6 247 7115/management
+358 6 247 7149/ financial administration
[email protected]
www.ilkka-yhtyma.fi
I-MEDIAT OY
Ilkka
Koulukatu 10
P.O.Box 60
FIN-60101 SEINÄJOKI
Tel. +358 6 247 7830
[email protected]
www.ilkka.fi
Etelä-Pohjanmaa (Epari)
Koulukatu 10
P.O.Box 60
FIN-60101 SEINÄJOKI
Tel. +358 6 247 7865
[email protected]
www.epari.fi
Pohjalainen
Hietasaarenkatu 19
P.O.Box 37
FIN-65101 VAASA
Tel. +358 6 247 7930
[email protected]
www.pohjalainen.fi
Vaasan Ikkuna (Ikkuna)
Hietasaarenkatu 19
P.O.Box 37
FIN-65101 VAASA
Tel. +358 6 247 7965
[email protected]
www.vaasanikkuna.fi
Jurvan Sanomat
Hahdontie 2
FIN-66300 JURVA
Tel. +358 6 247 7875
firstname.lastname@ jurvansanomat.fi
www.jurvansanomat.fi
Järviseutu
Hoiskontie 4
P.O.Box 33
FIN-62901 ALAJÄRVI
Tel. +358 6 247 7890
[email protected]
www.jarviseutu-lehti.fi
Komiat
Nikolaintie 5 B 12
FIN-62200 KAUHAVA
Tel. +358 6 247 7885
[email protected]
www.komiatlehti.fi
Suupohjan Sanomat
Läntinen Pitkäkatu 15
P.O.Box 4
FIN-64101 KRISTIINANKAUPUNKI
Tel. +358 6 247 7880
[email protected]
www.suupohjansanomat.fi
Viiskunta
Kirjapainonkuja 2
P.O.Box 11
FIN-63301 ALAVUS
Tel. +358 6 247 7870
[email protected]
www.viiskunta.fi
I-PRINT OY
Koulukatu 10
P.O.Box 21
FIN-60101 SEINÄJOKI
Tel. +358 6 247 7750
[email protected]
www.iprint.fi
I-print | plus Communications agency
Teollisuustie 24
P.O.Box 21
FIN-60101 SEINÄJOKI
Tel. +358 6 247 7750
[email protected]
www.iprint.fi
Printing house | i-print
Yrittäjäntie 17
P.O.Box 21
FIN-60101 SEINÄJOKI
Tel. +358 6 247 7750
Newspaper plant | i-print
Teollisuustie 24
P.O.Box 21
FIN-60101 SEINÄJOKI
Tel. +358 6 247 7750
Annual Report 2014 | 93
الخارجية، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان، ومن ثم فإننا ننسب إلى وجود عدد لا متناهٍ من الأعداد التي نسميها «الخارجية» (الخارجية) في كل مكان،
الخارجية. وقدْ وجدنا أن هذه الأعداد التي لا يمكن أن تكون غير مألوفة، بل هي غير مألوفة، بل هي غير مألوفة، بل هي غير مألوفة، بل هي غير مألوفة، بل هي غير مألوفة، بل هي غير مألوفة، بل هي غير مألوفة، بل هي غير مألوفة، بل هي غير مألوفة، بل هي غير مألوفة، بل هي غير مألوفة، بل هي غير مألوفة،
ILKKA-YHTYMÄ
Koulukatu 10, P.O. Box 60, FIN-60101 Seinäjoki | Tel. +358 6 247 7100 | www.ilkka-yhtyma.fi