EANS-Adhoc: Goldbach Group AG / Increase in profits, turnover stable

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6-month report

21.08.2012

Ad hoc press release

Half year result 2012:
Goldbach Group: Increase in profits, turnover stable

Turnover CHF 209 million - EBIT down by 5% - Profits up by 11% -
Sustained growth in TV and radio - Setbacks in online business -
Focus of online strategy

Kusnacht-Zurich, August 21st, 2012. Goldbach Group's net revenue in
the first half of 2012 was down 0.4% on the corresponding period in
the previous year (+0.6% after currency adjustment) at CHF 208.9m
(previous year CHF 209.8m), while the EBIT of 13.8m represented a
4.8% drop in comparison to the previous year (CHF 14.5m). The
advertising logistics specialist, which pursues the marketing of
private electronic, mobile and interactive media and online marketing
in the German-speaking countries, the Adriatic region and eastern
Europe, thus attained an EBIT margin of 6.6% (previous year 6.9%).
Cost-cutting measures which took effect in the first half of the year
should have an even more pronounced impact on the income statement in
the second half. Goldbach expects an increase in profit for the
current 2012 financial year, despite the stagnant turnover situation.
In view of the unsatisfactory course of business for Goldbach
Audience and the emerging consolidation at Goldbach Interactive,
Goldbach has reviewed its online strategy and decided to focus on
lines of business harbouring high development potential.

Media business line grows with TV and radio business

Turnover in the Media business line, which pools Goldbach Group's
marketing activities in the area of private TV, radio and digital
out-of-home advertising, first and foremost in Switzerland, as well
as in Austria and Romania, rose markedly once again in the first half
of 2012, increasing by 7.5% (7.6% after currency adjustment) to CHF
165.6m (previous year CHF 154.1m). Growth in radio business was
particularly outstanding, at 17%. TV business rose by 6%. The
increase in turnover derives primarily from Goldbach's existing
customer portfolio. Advertising in classic media such as TV and radio
remains in demand in a generally contracting advertising market, once
again affirming the trend witnessed in recent years. Since 2011, the
Media business line has been marketing a network of local private TV
stations in Romania and eastern Europe. Romanian TV business is
developing very positively, showing a growth rate of over 30%.
Goldbach Media's market share in Switzerland rose once again. The
Media business line contributed 79% to Goldbach Group's total
turnover in the first half of 2012 (previous year 74%). EBIT for the
Media business line rose slightly, by 0.1%. The Media segment
accounted for 86% of the Group EBIT (previous year 85%).

Business sluggish for Audience business line - increase in turnover
with online moving images

The Audience business line spans Goldbach's product range in the
areas of online advertising and performance marketing. This business
line suffered a substantial drop in turnover in the first half of
2012, falling by 27.8% (-24.2% in local currency) to CHF 27.7m
(previous year 38.4m). EBIT rose by 63.5% to CHF 2.6m (previous year
CHF 1.6m) as a result of cost cutting to the tune of 20% and a
one-off effect. As in previous years, low-margin bulk business was
avoided in the Audience business line. Substituting this with
high-margin business proved difficult in the generally declining
display markets in Switzerland and eastern Europe, however. The
business line additionally lost a number of clients mainly in Poland
(direct marketing facebook). In contrast, the Goldbach Video Network
which was launched in February 2012 to sell moving image advertising
is proving a sales driver. Against the background of the rapid spread
of mobile devices such as smartphones and tablets, TV is being used
ever more frequently and for longer periods online and on the move.
The Audience business line accounted for 12% (previous year 16%) of
overall turnover in the first half of 2012 and 13% (previous year 8%)
of the Group's EBIT - whereby the latter result was attributable
primarily to a one-off effect. In response to the clearly
unsatisfactory course of business for the Audience business line in
the second half of 2012, Goldbach Group has reviewed its online
strategy and decided to focus its efforts on developing moving image
marketing.

Interactive business line: Consulting services for interactive
marketing in demand - customers lost and substantial investments

Goldbach Group's Interactive business line has been offering concept
development, design and technological services for interactive and
mobile communication and marketing solutions since 2008. This area of
business is now established throughout the German-speaking countries
and in Poland and Russia as well. Turnover for the Interactive
business line fell by 8.1% (5.5% in local currency) in the first half
of this year, to CHF 18.5m (previous year CHF 20.1m). EBIT dropped by
86.7% over this period, to CHF 0.2m. This decline in turnover is
attributable primarily to the change of the number of key consulting
mandates in Switzerland. Demand for consulting services in connection
with online communication and in the area of mobile advertising and
social media remains high. The Interactive business line contributed
9% (previous year 10%) to Goldbach Group's overall turnover and 1% to
the Group EBIT (previous year 7%).

Total turnover on the level of previous year

In all, the Media business line accounted for 79% of total turnover
in the first half of 2012 (previous year 74%), while the Audience
business line contributed 12% (previous year 16%) and the Interactive
business line made up 9% (previous year 10%). The share of Swiss
business rose in the first six months to 88% (previous year 86%),
while the share of international business stands at 12% (previous
year 14%).

Profit and equity ratio

The net profit amounted to CHF 3.4 million (prior year: CHF 3.1
million) and increased by 11% over the prior year period. As of the
end of June 2012, the equity ratio amounted to 31.5% (as of end of
June 2011: 28.9%). The operative cash flow generated in the first
half of the year amounts to CHF 3.1 million (previous year CHF 7.3
million).

Outlook

For 2012 as a whole, against a backdrop of continuing difficult
conditions on the online market and sustained high demand in TV
business, Goldbach Group expects turnover to be on a par with the
previous year, while the profit for the year is expected to be higher
as a result of the successfully implemented cost-cutting measures.

"Goldbach Group has been investing in the development of online media
and broadening its presence in the classic electronic media such as
TV for some years now. TV and video are now becoming interactive, and
moving image media as well as mobile and interactive communication
are converging. Goldbach Group is at home in both worlds and in a
virtually unrivalled position to benefit from the growing importance
of the moving image in its capacity as an advertising logistics
specialist."

To analysts, investors and media representatives: You can find the
half year result report 2012 of Goldbach Group on the following
website: http://www.goldbachgroup.com/investor-relations-en/half-year
-report-2012

Further inquiry note:
Paul Riesen, Germaine Mueller
Tel. +41 44 914 91 00
Mobile: +41 79 688 24 74
germaine.mueller@goldbachgroup.com
paul.riesen@goldbachgroup.com

end of announcement euro adhoc
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issuer: Goldbach Group AG
Seestrasse 39
CH-8700 Küsnacht
phone: +41 44 914 91 00
FAX: +41 44 914 93 60
mail: info@goldbachgroup.ch
WWW: www.goldbachgroup.ch
sector: Media
ISIN: CH0004870942
indexes: SPI, SPIEX
stockmarkets: Main Standard: SIX Swiss Exchange
language: English