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    SCHA   NO0003028904

SCHIBSTED ASA

(SCHA)
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Schibsted : Q2 2021 Report

07/16/2021 | 01:05am EST

After a very strong first quarter, we are happy to see an even stronger development through the second quarter, driven by solid market recovery. Underlying¹ revenues grew 18 percent compared to a COVID-19 affected last year, but even more importantly we also delivered a 9 percent underlying¹ growth compared to 2019. Driven by the strong revenue growth, we achieved an EBITDA of NOK 743 million in Q2, up from NOK 498 million in the same period last year. The strong increase

in EBITDA was driven by Nordic Marketplaces and News Media.

Revenues from Nordic Marketplaces grew by an underlying¹ 32 percent in the quarter, mainly driven by a strong development in job verticals in all markets, but especially in Norway. At the same time, the real estate and motor verticals across the markets have also shown a positive development compared with the same period last year, as has the development in advertising revenues. In Finland, we are seeing a clear increase in traffic on Oikotie after the integration with Tori has now been completed. This supports a positive underlying¹ income

development in all main verticals in Finland during the quarter.

News Media had another strong quarter, where underlying2 revenues grew 10 percent in combination with continued good traction on the cost program. The revenue growth in News Media is driven by a significant uplift in digital advertising revenues, also compared to 2019, in addition to continued strong growth in revenues from digital subscriptions.

Within Financial Services, Lendo's underlying² revenues returned to growth in the quarter, although banks continued to be restrictive in their lending practices. Distribution continued to record strong growth on top of an amplified quarter last year, when online shopping trends increased as result of the COVID-19 outbreak. Prisjakt, on the other hand, showed a slight underlying² revenue decline and affected EBITDA negatively compared to last year due to product investments.

On 25th June, Adevinta finally completed the acquisition of eBay Classifieds Group, creating the world's largest online classifieds platform. As a result of the transaction, Schibsted's ownership share has been reduced to 33 percent of Adevinta's total outstanding share capital. Since Schibsted then no longer has a controlling ownership position in the company, the ownership interest at the time of the transaction is remeasured at fair value in our balance sheet, calculated based on Adevinta's share price at the date of closing. This has led to a significant accounting gain, amounting to NOK 60 billion. The value of the retained interest is together with the value of the shares distributed to shareholders at the time of the spin off a strong sign of the significant value creation to shareholders coming out of Schibsted's long term strategic focus on shaping the global classified industry.

The closing of the eBay transaction also means that we can finally welcome our Danish colleagues to the Schibsted family, which we have been looking forward to since last summer. Together, we will be very well equipped to develop and grow the next generation of online classified businesses in the Nordic region.

Lastly, Schibsted has implemented a new organizational model from 1st July, which links marketplaces with distribution, sharpens focus on venture investments and financial services, and paves the way for an even more ambitious company-wide growth agenda. The new organizational model builds on Schibsted's proven foundation, and is all about matching businesses that can make each other better, while at the same time giving all our businesses the focus and direction they need to grow. In addition, we will increase our efforts further to shape and execute a holistic investment strategy. The aim is to identify additional opportunities for investments, growth and transformation, potentially broadening Schibsted's portfolio of businesses and brands. In connection with this, we are very happy to introduce a new member to our Schibsted Group Executive Management team. In Q3, Andrew Kvålseth will join as our new Chief Investment Officer.

- Kristin Skogen Lund, CEO

  1. Foreign exchange neutral basis and including pro-forma Oikotie revenues in Q2 2020
  2. Foreign exchange neutral basis

2

  • Closing of Adevinta's acquisition of eBay Classifieds Group, and Schibsted's acquisition of eBay Classifieds' Danish operations, strengthening our position as the Nordic online classifieds champion.
  • Significant accounting gain of NOK 60 billion from Adevinta fair value recognition at closing.
  • Underlying¹ revenue growth of 18 percent ensured strong quarterly EBITDA of NOK 743 million, 49 percent above last year and 33 percent higher than 2019.
  • Nordic Marketplaces: Accelerated underlying¹ revenue growth of 32 percent, primarily driven by the Job vertical. Strong EBITDA margin of 55 percent in Norway and 43 percent in Sweden.
  • News Media: Continued strong performance with underlying² revenue growth of 10 percent, driven by re-bounce in digital advertising in addition to continued strong growth in digital subscriptions. Strong EBITDA margin of 14 percent.
  • Financial Services: Underlying² revenues in Lendo returned to growth vs. somewhat weak comparables. Solid EBITDA margin, increasing slightly YoY.
  • Growth: Underlying² revenue growth of 16 percent on top of an amplified quarter last year, driven by Distribution. EBITDA decline YoY driven by Prisjakt investments in product development.

Second quarter

Year to date

(NOK million)

2021

2020

Change

2021

2020

Change

Schibsted Group

Operating revenues

3,619

3,073

18%

7,019

6,099

15%

- of which digital

2,353

1,851

27%

4,461

3,677

21%

EBITDA

743

498

49%

1,338

783

71%

EBITDA margin

21%

16%

19%

13%

Operating revenues per segment

Nordic Marketplaces

1,047

753

39%

1,924

1,496

29%

News Media

1,947

1,802

8%

3,792

3,572

6%

Financial Services

271

252

8%

550

545

1%

Growth

689

604

14%

1,434

1,148

25%

EBITDA per segment

Nordic Marketplaces

489

341

43%

849

639

33%

News Media

275

148

86%

481

184

>100%

Financial Services

39

31

26%

89

69

29%

Growth

13

33

(61%)

48

14

>100%

Other/Headquarters

(73)

(54)

(34%)

(128)

(123)

(4%)

Historical income statement figures have been re-presented

Alternative performance measures (APMs) used in this report

due to the classification of Adevinta as a separate item under

are described at the end of the report.

"Discontinued operations" (see Note 6).

3

Second quarter

Year to date

(NOK million)

2021

2020

Change

2021

2020

Change

Classifieds revenues

833

590

41%

1,535

1,183

30%

Advertising revenues

136

106

29%

244

207

18%

Other revenues

78

57

36%

145

106

37%

Operating revenues

1,047

753

39%

1,924

1,496

29%

EBITDA

489

341

43%

849

639

33%

EBITDA margin

47%

45%

44%

43%

Revenue growth in Nordic Marketplaces accelerated in all three countries during the second quarter, primarily driven by the Job vertical.

Oikotie numbers were included from mid-July 2020 onwards and affected the revenue growth positively. On a foreign exchange neutral basis, and adjusting the Q2 2020 figures with pro-forma numbers for Oikotie, revenues increased 32 percent compared to Q2 last year.

EBITDA increased significantly compared to Q2 last year due to the consolidation of Oikotie and the strong revenue growth. On a foreign exchange neutral basis, and adjusting the Q2 2020 figures with pro-forma numbers for Oikotie, EBITDA increased 41 percent compared to Q2 last year.

Second quarter

Year to date

(NOK million)

2021

2020

Change

2021

2020

Change

Classifieds revenues

538

366

47%

968

749

29%

Advertising revenues

64

49

30%

113

99

14%

Other revenues

69

54

27%

123

102

20%

Operating revenues

670

469

43%

1,203

949

27%

EBITDA

370

244

51%

638

455

40%

EBITDA margin

55%

52%

53%

48%

Marketplaces Norway delivered a strong 43 percent revenue growth compared to Q2 last year. As in the previous quarter, the growth was primarily driven by higher volumes, supported by improved ARPA, in the Job vertical.

"Traditional" Motor (excluding Nettbil) experienced volume growth compared to Q2 last year in addition to an increased demand for upsale products towards the end of the quarter.

Increased volume was also the main driver for revenue growth in Real estate this quarter, although a high demand continues to result in less need for republishments.

The travel vertical has started a slight upgoing trend, in line with the ease of COVID-19 related travel restrictions.

Advertising revenues ended 30 percent above Q2 last year and 16 percent above Q2 2019. The increase was driven by both direct and programmatic advertising.

The strong EBITDA margin in Q2 is driven by higher revenues. Costs are somewhat lower than planned due to longer time lines to fill vacant positions within the product and technology function.

Second quarter

Year to date

(SEK million)

2021

2020

Change

2021

2020

Change

Classifieds revenues

234

207

13%

440

411

7%

Advertising revenues

50

43

17%

90

82

10%

Other revenues

4

3

52%

8

3

>100%

Operating revenues

288

252

14%

537

496

8%

EBITDA

124

106

17%

228

209

10%

EBITDA margin

43%

42%

43%

42%

4

Revenues in Marketplaces Sweden increased by 14 percent, driven by all main verticals including advertising.

The Motor vertical saw a solid growth driven by higher professional volumes and the premium product "Bump", and

the Jobs vertical experienced an accelerated revenue growth driven by volume recovery.

EBITDA margin slightly above last year driven by revenues, partly offset by investments in marketing and product development.

Second quarter

Year to date

(EUR million)

2021

2020

Change

2021

2020

Change

Classifieds revenues

6.1

1.0

>100%

12.3

2.0

>100%

Advertising revenues

2.2

1.1

95%

4.0

2.4

69%

Other revenues

1.2

0.1

>100%

2.4

0.1

>100%

Operating revenues

9.5

2.2

>100%

18.7

4.5

>100%

EBITDA

1.4

0.0

>100%

1.8

0.4

>100%

EBITDA margin

15%

1%

9%

8%

The table above consists of Schibsted's Finnish Marketplaces, Tori and Oikotie. Oikotie numbers were included from mid-July 2020 onwards, driving the growth compared to Q2 last year. Adjusting Q2 2020 figures with pro-forma numbers, classifieds revenues increased year-on-year in Q2 across all verticals, especially within Jobs. Advertising revenue turned around

from last quarter, with 30 percent growth compared to last year.

EBITDA was affected by investments in marketing, product and technology in the quarter.

Second quarter

Year to date

(NOK million)

2021

2020

Change

2021

2020

Change

Advertising revenues

711

552

29%

1,318

1,105

19%

-of which digital

536

392

37%

987

764

29%

Subscription revenues

690

657

5%

1,389

1,289

8%

-of which digital

311

263

18%

621

505

23%

Casual sales

282

315

(10%)

555

621

(11%)

Other revenues

264

279

(5%)

530

557

(5%)

Operating revenues

1,947

1,802

8%

3,792

3,572

6%

Personnel expenses

(684)

(641)

7%

(1,334)

(1,301)

3%

Other expenses

(988)

(1,014)

(3%)

(1,977)

(2,087)

(5%)

Operating expenses

(1,672)

(1,654)

1%

(3,311)

(3,388)

(2%)

EBITDA

275

148

86%

481

184

>100%

EBITDA margin

14%

8%

13%

5%

News Media continued the strong performance from the last quarters with an increase in both revenue and EBITDA margin compared to Q2 last year. The foreign exchange neutral revenue growth of 10 percent was driven by significant growth in digital advertising and continued strong growth in subscriptions. Driven by both volume and ARPU, digital subscriptions continued to grow even with stronger comparable numbers from last year. Advertising, both digital and print, grew compared to last year. The growth was both

driven by lower comparable numbers from last year, but also a very strong advertising market overall.

The cost reduction program of NOK 500 million is still progressing according to plan. Q2 2020 was heavily impacted by COVID-19 cost reductions, and as these effects are diminishing, the operating expenses increased slightly compared to last year.

EBITDA increased by NOK 127 million compared to Q2 last year, and margin was strong at 14 percent.

5

This is an excerpt of the original content. To continue reading it, access the original document here.

Disclaimer

Schibsted ASA published this content on 16 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 16 July 2021 05:04:08 UTC.


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Sales 2021 14 595 M 1 590 M 1 590 M
Net income 2021 61 695 M 6 723 M 6 723 M
Net Debt 2021 6 649 M 725 M 725 M
P/E ratio 2021 1,47x
Yield 2021 0,54%
Capitalization 84 277 M 9 184 M 9 184 M
EV / Sales 2021 6,23x
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Nbr of Employees 5 000
Free-Float 69,4%
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Technical analysis trends SCHIBSTED ASA
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Mean consensus OUTPERFORM
Number of Analysts 12
Last Close Price 386,60 NOK
Average target price 514,00 NOK
Spread / Average Target 33,0%
EPS Revisions
Managers and Directors
Kristin Skogen Lund Chief Executive Officer
Ragnar Kňrhus Chief Financial Officer
Ole Jacob Sunde Chairman
Sven St°rmer Thaulow Chief Data & Technology Officer
Christian Ringnes Independent Director
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