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MarketScreener Homepage  >  Equities  >  Swiss Exchange  >  APG|SGA SA    APGN   CH0019107025


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APG|SGA : Letter to shareholders 2020-1

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08/01/2020 | 11:11am EDT

Letter to Shareholders


APG|SGA SA Letter to shareholders July 30, 2020 3

COVID-19 pandemic puts a temporary brake on business development. Comprehensive measures to secure liquidity and reduce costs.

Focus on growth projects in the areas of digitalization, data, innovation. Financial situation sound.

In brief

  • Advertising revenue: CHF 107.8 million -29.2% (Switzerland -28.6%, International -40.5%)
  • EBITDA: CHF -0.2 million
  • EBIT: CHF -5.1 million
  • Consolidated net income: CHF -5.1 million
  • Free cash flow: CHF 3.0 million

Financial highlights

in CHF 1 000

1st half of 2020

1st half of 2019


Advertising revenue

107 810

152 262


- Switzerland

103 484

144 994


- International

4 326

7 269


Operating income

110 297

153 127




29 741


- in % of operating income




-5 092

24 441


- in % of operating income



Consolidated net income

-5 066

19 386


- in % of operating income



Cash flow from operating activities

4 786

12 505


Free cash flow1

2 968

9 807


Investments in property, plant, and equipment

3 018

2 738


- advertising panel

2 718

2 168


- other investments




Loss/Earnings per share, in CHF




EBITDA: Earnings before interest, taxes, depreciation of property, plant, and equipment, and amortization of intangible assets

EBIT: Earnings before interest and taxes

1 Cash flow from operating activities (operating cash flow) CHF 4 786 (previous year: 12 505) less cash flow from investing activities CHF 1 818

(previous year: 2 698), (see page 12 Consolidated statement of cash flows)

4 APG|SGA SA Letter to shareholders July 30, 2020

Dear Shareholder:

General business development

This year opened on a highly favorable note for APG|SGA. Both January and February brought evidence of substantial dynamism in revenue growth. The positive development of our growth projects inspired confidence as we looked ahead to the rest of the year.

In March, however, development of revenues and results was massively influenced from one day to the next as we felt the impact of the COVID-19 pandemic. This was caused by two factors beyond our control.

First, the business model for any outdoor advertising company depends on the reach that advertising panels achieve among the population. For APG|SGA, this primarily means analog and digital advertising spaces in public areas, such as railway stations and airports. Although the lockdown measures ordered by the Federal Council were certainly in the public interest, they led to a massive drop in passing traffic in these communication spaces from March. This took away a key foundation of our business activities, and as a consequence a large number of advertisers canceled their outdoor campaigns with immediate effect. The second factor was the closure of retail businesses during the lockdown period, ordered as part of the extraordinary measures. No longer able to sell to customers in store, many businesses halted their advertising campaigns. Poor economic prospects and cost saving measures on the side of our customers acted as further dampeners on advertising activities.

The resulting drop in revenue hit the company directly, and with great force, particularly in the second quarter. We see this pressure on the result; given the historic collapse in revenue, higher minimum guarantees and concession fees have had a correspondingly negative impact.

When the pandemic broke out, we immediately took numerous extensive and consistent measures to secure liquidity and reduce costs. We experienced a great deal of solidarity from shareholders, employees and contract partners, who all helped to support the company through this unprecedented crisis.

Despite the persistence of poor general conditions and limited visibility over the coming reporting period, the fundamental factors for both outdoor advertising and APG|SGA remain positive, as the start of the year demonstrates. Despite the strict overall cost-saving measures in place, we have continued our digital project developments and expanded our service portfolio. In the last few months, we have also entered into various marketing contracts. We are therefore confident that we have laid the groundwork for sustainable expansion of our competitive position.


In the first half of 2020, the APG|SGA Group achieved advertising revenues totaling CHF 107.8 million, representing a reduction in sales of 29.2%. Real estate revenue was CHF 0.8 million, about the same level as the previous year. Income from the sale of obsolete tangible assets was recorded under other operating income, which amounted to CHF 1.7 million in the reporting period. This resulted in operating income for the first half of 2020 of CHF 110.3 million, representing a fall of 28.0%.

APG|SGA SA Letter to shareholders July 30, 2020 5

Fees and commissions represented 63.6% of operating income in the first half-year 2020, clearly exceeding the previous year's level of 50.9%. The main drivers of this increase were concession contracts with non- sales volume related fees, combined with a sharp reduction in revenue. This key figure is also influenced by tougher competitive conditions in the procurement market for strategic contracts.

Personnel expenses fell by 15.5% in the reporting period. A freeze on bonuses, a temporary reduction in management remuneration and compensation for short-term work contributed to this reduction. Operating and administrative costs were 2.4% lower than the previous year's period. Although the reduction in expenses for core business was in the two-figure percentage range, expenditure on growth projects in the digital service portfolio and for digital booking and processing platforms increased.

The massive drop in revenue, a direct consequence of the COVID-19 crisis, greatly influenced the operational result despite strict cost-saving measures. For the reporting period, this resulted in an EBITDA of CHF -0.2 million (previous year: CHF 29.7 million) and an EBIT of CHF -5.1 million (previous year: CHF 24.4 million).

APG|SGA reports as per Swiss GAAP ARR guidelines and has opted not to capitalize losses carried forward. This means that despite the negative ordinary result before income tax, tax income is minimal. The consolidated net income for the first half of 2020 amounted to CHF -5.1 million (previous year: CHF 19.4 million).

Cash flow

Operating cash flow for the first half-year 2020 amounted to CHF 4.8 million (previous year:

CHF 12.5 million). As receivables from customers have decreased significantly, this drop of 61.7% was significantly lower than for consolidated net income.

Cash flow from operating activities is subject to seasonal fluctuations and is always significantly lower in the first half of the year than the second.

After deduction of cash flow from investment activities of CHF 1.8 million, this resulted in a free cash flow of CHF 3.0 million (previous year: CHF 9.8 million).

Balance sheet

The balance sheet total fell by CHF 16.7 million in the first half of 2020 to CHF 176.2 million.

Lower investment resulted in fixed assets falling by CHF 3.1 million to CHF 85.8 million. Intangible assets amounted to CHF 20.3 million, corresponding to 11.5% of total assets. Current assets fell by CHF 13.6 million, driven in particular by significantly lower trade accounts receivable. As at June 30, 2020, cash and cash equivalents stood at CHF 44.9 million.

Equity amounted to CHF 72.0 million, representing an equity ratio of 40.8%.

6 APG|SGA SA Letter to shareholders July 30, 2020

Swiss market

For the first half of 2020, advertising revenues for APG|SGA stood at CHF 103.5 million, 28.6% below the previous year. Almost every customer segment and category was affected equally by this drop, although - as expected - online and traditional retailers proved considerably more robust. Greater flexibility in booking and cancellation options meant that the drop in revenue was a little lower for digital products than for analog advertising options. Products in the communication spaces of railway stations, public transport, airports and the promotional space business were affected by an above-average rate of compensation claims due to reduced footfall. The months of March, April and May were particularly affected by this reduction in revenue, with the first signs of recovery becoming evident in late May and June.

To further this positive momentum, APG|SGA launched a major sales promotion campaign to support and boost its advertising activities as the first easing measures were introduced in early May. This "Welcome back out of home" package met with a considerable response, and numerous short-term campaigns were carried out.

Recent weeks have brought the first signs of recovery in the activities of agents and customers. APG|SGA has therefore progressively phased out short-time work in order to secure the operational conditions for active market development.

Throughout the first half of 2020, new high-performance digital branding zones in major SBB stations went into operation. The February launch of six exclusive branding zones with 77 "Rail ePanels" in Zurich's main station was followed in June by seven branding zones with 39 new screens in Bern and Lucerne stations.

In early June, APG|SGA launched its programmatic advertising service in collaboration with the leading international platform VIOOH. Large cities and railway stations now have more than 500 screens available for programmatically planned and booked campaigns. This allows customers to manage their campaigns efficiently and much more flexibly and to profit from additional targeting opportunities.

In the first half-year 2020, APG|SGA was able to further optimize its contract portfolio and create sound conditions for further growth through various tender procedures. APG|SGA and BLS are renewing their partnership and further expanding their collaboration. PostAuto awarded our company the contract to market advertising spaces on and in some 1,600 vehicles. This represents the lion's share of the PostAuto inventory

  • in both revenue and number of advertising panels - and continues the longstanding collaboration between APG|SGA and Switzerland's largest public transport bus company, and underlines its leading market position in transport advertising. APG|SGA also renewed its successful partnership with transport operator TPF for the management of numerous advertising spaces in attractive locations in the city of Fribourg.

APG|SGA SA Letter to shareholders July 30, 2020 7

International markets

APG|SGA's international operations in the form of Serbian subsidiary Alma Quattro d.o.o. contributed 4.0% to group revenues in the reporting period.

Although the first months of the year saw a revenue increase over the previous year, Serbia witnessed a similarly sharp drop in revenues in April due to the COVID-19 lockdown. Since June, there has been a slow return of revenues.

Advertising revenues declined at a rate of 37.1% in local currency in the first half of 2020. The weakening of the Serbian dinar resulted in a reduction of 40.5% in Swiss francs.

Although Alma Quattro has a long-term exclusive contract with the capital Belgrade, early 2020 saw a competitor awarded the concession to operate more than 250 digital advertising panels in the city. In our view, this award violates the exclusivity clause of the contract with Alma Quattro. Legal proceedings to contest this award are currently underway. There have also been a number of attempts at the diplomatic level to protect investments and ensure fair proceedings and legal certainty.


At the APG|SGA AG General Meeting on May 14, 2020, Dr. Maya Bundt and Jolanda Grob were elected to the Board of Directors. All members up for reelection were confirmed for a further year. The Board of Directors comprises: Dr. Daniel Hofer (Chairman), Dr. Maya Bundt, Xavier Le Clef, Jolanda Grob, Stéphane Prigent, Robert Schmidli (Vice-Chairman) and Markus Scheidegger. Robert Schmidli, Markus Scheidegger and Jolanda Grob were elected to the Board of Directors' Remuneration Committee.


The gradual easing of restrictive measures since May has shown how much people enjoy being "out of home" again. People are increasingly getting about on foot, by bicycle, on public transport or in cars, to the office, to school, or just shopping and enjoying their leisure time. This is good news for awareness of APG|SGA advertising space and is leading to increased advertiser requests and bookings. These positive indicators aside, the general conditions with respect to both the course of the COVID-19 pandemic and the economy remain difficult to assess. A reliable forecast of business development in the second half of the year is thus not feasible.

The Board of Directors and the Executive Board feel strongly that APG|SGA is very robust overall and will emerge from this crisis stronger due to its proven business model. The convincing fundamental factors that speak in favor of out of home media remain unchanged. The generally strong dynamic of the outdoor advertising market will continue after the crisis in Switzerland has come to an end. We are therefore convinced that the medium and long-term market and earnings prospects in the operational business for APG|SGA, which plays a key role in both the analog and digital out of home media market in Switzerland, remain positive.

8 APG|SGA SA Letter to shareholders July 30, 2020

APG|SGA would like to take this opportunity to thank its employees, all of whom have responded with great commitment, flexibility, discipline and confidence to the extraordinary situation and measures such as short- time work, working from home and compliance with distancing and hygiene rules.

On behalf of the Board of Directors and the Executive Board, we would also like to thank our shareholders, market partners, advertising customers and concession issuers for their support and trust in our company in these challenging times.

Dr. Daniel Hofer

Markus Ehrle

Chairman of the Board

Chief Executive Officer

APG|SGA SA Letter to shareholders July 30, 2020 9

Consolidated balance sheet


in CHF 1 000



Buildings and land

31 729

32 576

Advertising panel

22 490

22 381

Other property, plant, and equipment

3 447

4 074

Property, plant, and equipment

57 666

59 031

Deferred tax assets

1 367

1 351

Other financial investments

6 532

7 400

Financial investments

7 899

8 751


5 473

5 648

Contractual advertising rights

14 799

15 515

Intangible fixed assets

20 272

21 163

Non-current assets

85 837

88 945


4 159

3 865

Trade accounts receivable

24 864

44 331

Other accounts receivable

11 183

7 415

Deferred expenses and accrued income

5 219

6 547

Cash and cash equivalents

44 936

41 762

Current assets

90 361

103 920


176 198

192 865

Shareholders' equity and liabilities

in CHF 1 000



Share capital

7 800

7 800

Capital reserves, premiums

12 942

13 246

Treasury shares



Translation differences

-2 454

-2 098

Retained earnings

53 982

59 048

Shareholders' equity

71 957

77 143

Financial liabilities




7 320

7 979

Deferred tax liabilities

3 008

3 302

Non-current liabilities

10 650

11 631

Trade accounts payable

5 136

7 989

Taxes payable

2 998

7 265

Other accounts payable

34 624

29 995

Accrued liabilities and deferred income

49 902

56 454



2 388

Current liabilities

93 591

104 091


104 241

115 722


176 198

192 865

10 APG|SGA SA Letter to shareholders July 30, 2020

Consolidated income statement

in CHF 1 000

1st half of 2020

1st half of 2019


Advertising revenue



152 262


Real estate revenue




Other operating income




Operating income



153 127


Fees and commissions

-70 153

-77 953


Personnel expenses

-25 834

-30 566


Operating and administrative costs

-14 516

-14 867


Operating result before depreciation and amortization (EBITDA)


29 741


Depreciation of tangible assets

-4 246

-4 644


Amortization of intangible assets




Amortization of goodwill



Operating result (EBIT)

-5 092

24 441


Financial result



Result from joint ventures


Ordinary result before income tax

-5 177

24 309


Income tax


-4 923

Consolidated net income

-5 066

19 386


Basic and diluted loss/earnings per share, in CHF




APG|SGA SA Letter to shareholders July 30, 2020 11

Consolidated statement of changes in equity



in CHF 1 000












as at January 1, 2019

7 800

13 449


-1 461

77 171

96 211

Consolidated net income

19 386

19 386

Translation differences




-59 955

-59 955

Purchase of treasury shares



Sale of treasury shares




Equity transaction costs



as at June 30, 2019

7 800

13 230


-1 714

36 602

55 739

as at January 1, 2020

7 800

13 246


-2 098

59 048

77 143

Consolidated net income

-5 066

-5 066

Translation differences



Purchase of treasury shares



Sale of treasury shares




Equity transaction costs



as at June 30, 2020

7 800

12 942


-2 454

53 982

71 957

12 APG|SGA SA Letter to shareholders July 30, 2020

Consolidated statement of cash flows

in CHF 1 000

1st half of 2020

1st half of 2019

Consolidated net income

-5 066



Depreciation and amortization

4 886



Changes in provisions



Changes in deferred taxes



Financial result with no cash impact



Gain from sale of non-current assets

-1 661


Result from joint ventures


Change in inventories



Change in accounts receivable

15 555

-2 027

Change in deferred expenses and accrued income

1 295

-4 821

Change in accounts payable and taxes payable

-2 432


Change in accrued liabilities and deferred income

-6 528

-4 223

Cash flow from operating activities

4 786



Capital expenditures in property, plant, and equipment

-3 018

-2 738

Capital expenditures in intangible assets

-1 324


Sale of property, plant, and equipment

1 711


Sale of financial investments



Net cash used in investing activities

-1 818

-2 698

Purchase of treasury shares



Sale of treasury shares



Discharge of non-current financial liabilities


Dividends to APG SGA SA shareholders

-59 956

Net cash used in financing activities


-59 606

Currency translation effect on cash and cash equivalents



Change in cash and cash equivalents

3 174

-49 797

Cash and cash equivalents as at January 1

41 762

60 128

Cash and cash equivalents as at June 30

44 936

10 331

APG|SGA SA Letter to shareholders July 30, 2020 13

Notes to the consolidated financial statements

Reporting principles of APG|SGA SA

This interim financial report includes the unaudited semi-annual financial statements for the reporting period ended on June 30, 2020. The consolidated semi-annual financial statements were prepared in compliance with interim financial statement requirements as per Swiss GAAP ARR 31 Complementary Recommendation for Listed Companies, which permits condensed reporting and disclosures in comparison to the annual financial statements, and with the listing rules of the SIX Swiss Exchange.

APG|SGA does not report any segment earnings in its financial reports, because its direct competitors in Switzerland and in Serbia also do not publish any segment earnings. Disclosing them would put APG|SGA at a significant competitive disadvantage due to the low level of diversification abroad.

The preparation of the consolidated financial statements requires that management makes estimates and assumptions that influence the disclosed assets, liabilities, contingent assets and liabilities on the closing date as well as income and expenditure for the reporting period. The actual results may deviate from these estimates.

Our business is influenced by seasonal effects.

Changes in the scope of consolidation and minority interests

In the first half of 2020, the scope of consolidation compared with the prior-year period was not changed.

In the first half of the previous year, the scope of consolidation compared with the same period in 2018 was also not changed.

Change in shareholders' equity

In light of the current COVID-19 crisis, the General Meeting on May 14, 2020 resolved that no dividend will be distributed for the financial year 2019.

14 APG|SGA SA Letter to shareholders July 30, 2020


Announcement of annual results 2020 and publication of the annual report Monday, March 15, 2021

Financial media and analysts conference

Monday, March 15, 2021, Zurich

General Meeting

Wednesday, April 28, 2021, Geneva

Announcement of semi-annual results 2021

Thursday, July 29, 2021


Markus Ehrle, Chief Executive Officer

T +41 58 220 71 73

Beat Hermann, Chief Financial Officer

T +41 58 220 77 47

APG|SGA SA Letter to shareholders July 30, 2020 15

Explanation of financial terms


Earnings before interest and taxes


Earnings before interest, taxes, depreciation of property, plant and equipment, and amortization of intangible assets

Equity ratio

Shareholders' equity in % of balance sheet total

Free cash flow

Cash flow from operations minus cash flow from investments

This letter to shareholders is available in German, French and English.

The German version is legally binding.


APG|SGA AG Carrefour de Rive 1 CH-1207 Genève investors@apgsga.ch

Printed in Switzerland

July 2020

All rights reserved

APG|SGA AG is Switzerland's leading Out of Home media company. Listed on the SIX Swiss Exchange, APG|SGA covers all aspects of outdoor advertising: on streets and squares, in railway stations, at airports, in shopping centers, in the mountains as well as in and on means of transport - from poster campaigns with the widest coverage and large formats to state-of-the-art digital advertising spaces, special advertising formats, promotions and mobile advertising. When communicating with customers, the authorities and the advertising industry, APG|SGA represents sustainability and innovation, aiming to inspire people with the very best communication solutions in public spaces.


APG SGA SA published this content on 27 July 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 01 August 2020 15:11:09 UTC

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APG|SGA SA Technical Analysis Chart | APGN | CH0019107025 | MarketScreener
Technical analysis trends APG|SGA SA
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus HOLD
Number of Analysts 2
Average target price 160,00 CHF
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Spread / Lowest Target -2,32%
Markus Ehrle Chief Executive Officer
Daniel Hofer Chairman
Christian Gotter Head-Operations
Beat Hermann CFO, Head-Finance & International
Markus Scheidegger Non-Executive Director
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