Company announcement no 01-16

February 11, 2016

Intensified price competition and major volatility continue to put their mark on the media and advertisement market - and did so also on North Media in 2015.As a result, group revenue went down by 6% to DKK 1,012 million while EBIT before special items was a small loss of DKK 0.7 million.

"The advertising media market is changing rapidly. However, FK Distribution's greatest challenge is that we suffer from unfair competition from Post Danmark, who, with one hand, raisesthe 1st class mail postage stamps from DKK 10 to DKK 19 because the letter volumes are going down, and, with the other, they drive down printed matter prices to DKK 0.30 per item because printed matter volumes are going down.Both letters and printed matter are delivered by the same postman. Obviously, it puts FK Distribution's business under heavy pressure that Post Danmark abuses its dominant position in this way to dump prices of printed matter, and this feeds directly through to our bottom line," says Mads Dahl Andersen, CEO of FK Distribution A/S and Chief Executive Officer of North Media.

These harsh market conditions are the reason why North Media has in 2015 had heavy focus on achieving a higher level of agility in business developments. And results are beginning to show. Most importantly by 250,000 new consumers in 2015 having signed up for NoAds+, FK Distribution's new core product, so that the arrangement now covers more than 550,000 households. However, also by the newspapers having maintained their market position and online operations moving in the right direction - although at a slower pace than aimed for.

To lend additional force to this process, in early 2016 North Media reorganised its management and company structure under which operations are now divided into four new business segments, each with its own board of directors, and these segments are in future to ensure an optimal setting for maximising developments and earnings.

"The difficult times are not over yet. Market developments and the underlying assumptions will also in 2016 cause a reduction in the Group's revenue and performance. This is why it is vital that we keep our strategic spotlight on realising the potential of all of our business segments. With this new structure and strong financial resources, we are ready to face the challenges and strive for an expected improvement of performance from 2017," closes Kåre Wigh, Group Executive Director & CFO of North Media.

For further details, please contact Kåre Wigh, Group Executive Director & CFO, at +45 25 65 21 45.

Yours faithfully
North Media A/S

Kåre Wigh
Group Chief Executive Officer & CFO

North Media A/S issued this content on 11 February 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 11 February 2016 08:40:11 UTC

Original Document: https://newsclient.omxgroup.com/cdsPublic/viewDisclosure.action?disclosureId=695268&lang=en