EANS-Adhoc: Goldbach Group AG / Annual Result 2012

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annual result/annual report
05.03.2013

Ad hoc press release

Annual result 2012:
Goldbach Group with striking profit growth

Sales CHF 445 million - Profit CHF 9.1 million (+51%) - EBIT CHF
32.1 million (+6.9%) - Higher EBIT margin (7.2%) -Successful cost
management - Moving image advertising as sales driver - Dividend of
CHF 0.80 applied for - Sustained strengthening of profitability

Küsnacht, Switzerland, March 5th, 2013. During the financial year
2012 the Goldbach Group achieved CHF 445 million in sales
(previous year CHF 446 million), an EBIT of CHF 32.1 million
(previous year CHF 30.0 million) and 51% higher profits of CHF 9.1
million (previous year CHF 6.0 million). Despite an overall
recessive advertising sector and with subdued sales (-0.1%),
the Goldbach Group - market leader in advertising logistics for the
marketing of private electronic, mobile and interactive media and
online marketing in the German-speaking countries, the Adriatic
region and Eastern Europe, and active in these businesses in
Russia - achieved a considerably improved EBIT margin of 7.2%
(previous year 6.7%) and 6.9% improvement in EBIT (CHF 32.1
million). It is proposed that the General Meeting approves a
dividend of CHF 0.80 (previous year CHF 0.71), which is an increase
of 12.7%. Goldbach intends to further strengthen profitability
in the course of the financial year in progress.

Thanks to systematic cost management and a higher gross margin, EBIT
growth of +67% in the Business Line Audience was particularly
pronounced; the costs of international investment and expansion,
and of conversion to performance-oriented service in the Business
Line Interactive, resulted in an EBIT decline of 65%. On the other
hand, the Business Line with the strongest sales, the Business
Line Media, achieved EBIT growth of 9%.

Goldbach Media with a high level of sustainable, profitable growth
With the marketing of private TV, radio and Digital out of Home
advertising in attractive points of sale, particularly in
Switzerland but also in Austria and Romania, in 2012 the Business
Line Media remained on track for growth at a high level with a 4.2%
increase, with sales of CHF 351.9 million (previous year CHF 337.7
million).

Despite the general recession in advertising trends, TV (+2.5%)
and radio business (+12.6%) was encouraging on the whole, and the
market position was further strengthened. Goldbach Media
managed to further add to its new customers, providing broad
support to its customer base. In Switzerland, new
special-interest TV stations were added to the portfolio for
the year in progress.

The local-TV network launched two years ago in Romania
developed into a national offering that currently comprises 37
stations. The 40% increase in advertising volume in 2012 points
to the success of the expansion in the moving-image strategy into
Eastern Europe begun in 2011. Continuing development in the radio
area was just as successful. With a range of 64 stations and sales
growth in excess of 100%, Goldbach ranks among the leading providers
in this sector.

In Austria, it was particularly the Digital out of home network
that was expanded during the year under report, thanks to the
acquisition of new clients; in Romania, the portfolio was rounded
out at the beginning of this year with electronic outdoor
advertising space.

The EBIT margin of the Business Line Media increased by 0.4
percentage points, to 10.5%; EBIT growth totals 9%. In 2012
Goldbach Media contributed 84% (previous year 85 %) to Group EBIT.

High EBIT growth for Goldbach Audience despite decline in sales
Goldbach integrates its offerings for online advertising in its
Business Line Audience. Sales in Switzerland, Austria and the
Adriatic and Eastern European region were lower again, at CHF 62.1
million (previous year CHF 75.2 million) or a decline of 17%
(previous year -15%); still, the decline in sales slowed
considerably during the second semester, particularly in the display
business. The rigorous cost-management scheme that had already been
introduced at the end of 2011, along with a foregoing of weak-margin
mandates, played a major role in strengthening the Business Line
Audience.

In addition, with the launch of the Goldbach Video Network in
Switzerland during the first quarter of 2012 and the implementation
currently under way in the other countries, a concerted effort
was made to market moving-image advertising. Video advertising
already accounts for a 22% Group-wide share of overall Audience
sales, and the trend is an upward one. In addition, by
introducing the Goldbach Mobile Network during the second
semester, Goldbach made allowance for the rapid spread of
smartphones and tablets and further expanded its portfolio in
mobile online media. Business here is expected to grow in the
years to come, in keeping with worldwide market forecast, and
further strengthen the display segment.

Goldbach Audience reported 67% EBIT growth, and the EBIT margin
increased to 9.6% (previous year 4.8%), due in part to a positive
one-off effect (disposal of licence agreement). Its share of total
sales was 12% (previous year 15%); the contribution to Group EBIT
rose from 9% to 14%.

Goldbach Interactive: EBIT encumbered by expansion in
offerings and internationalisation Sales for the Business Line
Interactive were CHF 38.0 million (previous year CHF 39.1 million)
in 2012, declining primarily as a result of changes in
mandate in Switzerland and Germany (-3.0%). Goldbach Interactive
provided conceptual, design and technological offerings on all
aspects relating to interactive communication solutions and
marketing solutions for the Internet and mobile devices such as
smartphones and tablets. The Business Line comprises competence
centres devoted to Mobile, Social Media, Performance Campaigns,
Websites, Shops & Portals as well as Search. With these
offerings, Goldbach covers the entire value chain between
advertisers and online advertising, not just for classic digital
advertising but for performance marketing as well. Demand for
consulting services in these areas is increasing. At the
international level, it is becoming apparent that companies are
increasingly awarding multi-channel brand-management mandates, and
that the trend is towards on- and offline services from a single
source.

Goldbach Interactive is now active throughout the German-speaking
region, and in Poland and Russia as well. The Group further expanded
its services in the Adriatic with its takeover of a majority share
of the leading digital agency Renderspace in Slovenia.

The EBIT of Goldbach Interactive was 65% lower on the year,
particularly due to considerable investments in international
expansion; the EBIT margin fell to 2.1% (previous year 5.9%). Its
contribution to total EBIT was 2%.

Profit, equity ratio and dividend proposal The Goldbach Group's
profit according to IFRS rose by 51.0% in 2012 to CHF 9.1 million
(previous year CHF 6.0 million). The equity ratio increased to
32.8% (previous year 31.4%). Operative cash flow stands at CHF 33.2
million (previous year CHF 29.0 million). It is proposed that the
General Meeting approves a dividend of CHF 0.80 (previous year
0.71), which is an increase of 12.7%.

Outlook Following successful implementation of organisational
restructuring measures in Eastern Europe and the Adriatic, together
with Group-wide cost reductions, the Goldbach Group anticipates
further strengthening in profitability during the current 2013
financial year. In order to extend the Group's position in the
moving-image advertising area, market entry to further
countries by the Business Line Media is also under review during
the current financial year.

'The transfer of advertising to the electronic media is not over
yet,' Goldbach Group CEO Klaus Kappeler observes. 'Our offerings as
a provider of advertising logistics for all private electronic,
interactive and mobile media are entirely in line with the
international trend. The growing demand for advertising with
moving images and for performance-oriented marketing confirms this
development. With its network in the German-speaking, Eastern
European and Adriatic region, the Goldbach Group will be ready when
the economy recovers and the markets have catching-up to do.'

To analysts, investors and media representatives: You will find the
Goldbach Group 2012 Annual Report on our website, at: http://www.gold
bachgroup.com/investor-relations-en/annual-reports/annual-report-2012

Further inquiry note:
Germaine Mueller
Tel. +41 44 914 91 10
Mobile: +41 78 600 24 14
germaine.mueller@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