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The ProSiebenSat.1 Group successfully completed the 2012 financial year. We are optimistic for 2013 and 2014 and we anticipate a continuation of our profitable growth course. For that purpose, we will expand our core free TV business in the next few years and will advance the dynamic development in the Digital & Adjacent and Content Production & Global Sales segments. Moreover, we are constantly pursuing linking up our TV activities with the digital segment and are thus opening up new sources of revenues for our Group. On the basis of these strategic measures, we anticipate continued revenue and earnings growth. On the basis of continuing operations, we expect a revenue potential of more than EUR 600 million to 2015 in comparison to 2010. It is our aim to gain a double-digit revenue increase outside the traditional TV advertising business in the next few years.
The business approach is made up of two components: The conscious handling of risks and
consistent use of opportunities for additional revenue and earnings potential. Early and ongoing
identification, analysis, and controlling of future sources of revenues are a central task of
management at ProSiebenSat.1.
At ProSiebenSat.1, the management of opportunities is centrally organized and controlled by the “Corporate Development and Strategic Planning” department. The department identifies growth potential on the basis of detailed market and competition analyses and maintains close contact with the operational units and their managers. The identified factors for success and possible synergy potential are summarized in the strategy plan and incorporated in the decision-making process during the annual strategy meeting. The relevant opportunities are prioritized and strategic objectives derived. Opportunity management is part of the Group’s intragroup management system. It takes place in the context of the budget preparation process for the next twelve months and as part of the multi-year plan.
Opportunities for our Group primarily result from
The most important opportunities are described below:
|Opportunities from the development of general conditions||> New trends in the behavior of media usage
> Expansion of the range of services through technological developments and innovations
> Legislative changes and media policy decisions
> Macroeconomic developments
|Opportunities in corporate strategy||> Expansion of the station portfolio
> Entry into new business models
> International expansion of program production and distribution
|Performance opportunities||> Expansion and capitalization of audience share
> Use of new revenue models
> Optimization of costs
Media continue to represent an important element of society. According to the study „Navigator Mediennutzung 2012“ (Media Usage Navigator 2012)from ProSiebenSat.1 advertising time marketer SevenOne Media, the daily media use of 14 to 49 year olds has increased by 16% to almost 10 hours since 2002. The rise in media consumption is due both to TV — still the most important form of mass media — and to the high growth rates among new media.
Since television is benefiting more from digitalization than any other traditional media, the
continuing strength and popularity of TV also offers the ProSiebenSat.1 Group numerous opportunities
in the future. TV shows a considerably stronger online affinity than print, and as on TV,
video is the key driver on the internet as well. Due to the content-related and technological
convergence with the internet, TV is increasingly becoming an interactive medium and remains
relevant for young target groups. Therefore, new forms of media use are opening up growth
prospects to the ProSiebenSat.1 Group, both in the audience market and in the advertising
Growing need for media-compatible video content. Today, approximately 55% of online users watch videos on the internet. Mobile devices such as smartphones and tablet PCs make it possible to be entertained and informed by videos in any place, at any time. The ProSiebenSat.1 Group anticipates a strong rise in the need for media-compatible video content in the next few years. In order to benefit from this development, the company has built up a media portfolio that serves both linear and non-linear forms of use with the aid of the close link-up of TV and the internet.
The successful TV stations are the centerpiece and are flanked by numerous digital offerings. For example, numerous TV programs are available for free online for seven days after being broadcast on television. With extensive additional offerings, like backstage information, web-only video clips, social TVSocial TV The linking of social media and television. services, episode guides and actor profiles, the Group is extending its TV content onto the internet, thus strengthening the connection between consumers, programs, and brands. In 2012, the ProSiebenSat.1 Group also extended the advertising-financed internet portal MyVideo into an online TV station. With so-called “online first” premieres, MyVideo shows licensed US series before they are broadcast on free German TV. Between March and June 2012, the US series “Spartacus” achieved more than 13 million views on MyVideo. Subsequently on ProSieben, the series achieved a market share of up to 18.0% among 14 to 49 year old viewers. The Group conducted a survey to accompany the second series. It revealed that 32% of users used MyVideo due to the online preview. 30% of those surveyed also subsequently watched the series on television, and a further 13% were made curious about the TV show by the preview. The service is free for users and is financed by means of online video advertising. This example shows that the cross-media link-up of its content is opening up new growth opportunities for the ProSiebenSat.1 Group. Moreover, the ProSiebenSat.1 Group operates Germany’s biggest video-on-demandVideo-on-demand Allows the user to stream or download videos at any time. portal, maxdome. The online video library offers more than 50,000 feature films, series, sports and music highlights, as well as children’s films.
As well as a multimedia distribution network, the ProSiebenSat.1 Group has a comprehensive stock of rights with fictional and non-fictional programs that it can use across all platforms, from TV to the internet and mobile. In this way, the Group can serve viewers‘ new preferences of use and utilize the program inventory efficiently. This is a strategic advantage over mere internet providers who own distribution channels but not their own content.
Parallel use: Television as an interactive and social medium. While 10 years ago 19% of 14 to 49 year old viewers used TV and the internet at the same time, in 2012 the figure was already 59%. The ProSiebenSat.1 Group anticipates a continuation of this trend in the next few years. The increasing parallel use opens up new growth opportunities not only for the internet, but also for television. In many cases, it is TV that sets the initial impetus for finding out more about certain topics online. 69% use TV-related content on the internet while watching television. Viewers frequently look for products from TV programs or commercials online, as the following graph shows:
are an established part of everyday life and have led to viewers commenting
more and more often on TV programs online while they watch them. Television was already a
community experience before the digitalization of media and this is now continuing in social
networks and online forums. The ProSiebenSat.1 Group recognized the potential of this development
at an early stage and introduced the
social TVSocial TV The linking of social media and television. platform “Connect” for the first season of “The Voice of Germany” in 2011. The online portal brings together on one screen a live
stream of the show, the social networks Twitter and Facebook, as well as various interactive
tools. In this way, during the show viewers and users can exchange views with friends, comment
on the program and participate in surveys, the results of which are displayed live. Thus,
TV viewers become active commentators who deal intensively with program content. Representative
surveys demonstrate that this considerably strengthens the connection between
brands, program content, viewers, and users. 63% say that they find television more exciting
and more fun through the
social TVSocial TV The linking of social media and television. platform. 62% prefer to use the online portal than to flick
through the channels during commercial breaks. At the same time, the social TV application
is not only additive, but also causes users to want to switch on the program. The users of the
“The Voice Connect” are simultaneously loyal viewers of the TV show, with 81% revealing that
they watch almost every episode on television. Social TV measures offer the ProSiebenSat.1
Group the opportunity to increase the TV ratings of a program, retain viewers, provide them
with new platforms, and thus make the show more attractive for advertising customers as
Optimized sales opportunities. The dynamic development of digital media also offers the company attractive growth opportunities in the advertising market in the next few years. The rising number of second screens — the graph below shows the forecast spread of devices with screens — results not only in additional advertising space.
The link-up between TV and internet advertising also increases the advertising impact. The
“Navigator Mediennutzung” study shows that among 14 to 49 year old internet users, 44% have
already become aware of products on television and have then looked for these on the internet.
Experts forecast a strong rise in advertising on mobile devices in the next few years. For instance,
the American market research institute eMarketer has calculated that the advertising volume
with mobile advertising in the USA will quadruple by 2016. Additional mobile screens also open
up to television companies the opportunity to make transactions such as online purchases
directly via TV programming. Up until now, this has still been largely reserved for internet companies.
The ProSiebenSat.1 Group will benefit from this both as a sales company and through its
Ventures portfolio with investments in the sports, beauty, health, fashion, home & living, market
places and travel industries. The Group makes use of its strong market position and can advertise
the products via its own station and online network and trigger purchases. In Germany, the
ProSiebenSat.1 Group is the leading seller of video content both on free TV and on the internet.
Furthermore, the Group can provide its advertising customers with a direct feedback channel for communication with consumers on the internet as well as with social TV applications such as “ProSieben Connect.” This feedback channel includes survey modules, badges, cross-media campaigns, and sponsorship campaigns that are tailored to customers individually. Particularly effective are overarching concepts that combine traditional forms of advertising with the new opportunities. The sales subsidiary SevenOne AdFactory specializes in 360 degree concepts, as they are known, in which all of ProSiebenSat.1’s platforms, from TV to online and mobile to games, are included in sales. The ProSiebenSat.1 Group will also develop tailored sales concepts in future to strengthen its position as trailblazer on the German market and to take a share in the growth of social TV.
TV advertising market grows at the expense of the print market. The growing relevance of TV and the internet is likely to lead to a further shift in the media market. The declining usage figures in the print industry have been reflected in the German advertising market for several years. Between 2000 and 2011, the net advertising market share of print products fell by 10 percentage points to 56%. In contrast, TV increased its share from 24% to 26%. The ProSiebenSat.1 Group expects this development to continue and that the television category will increase its share in the net advertising market to between 27% and 29% by 2015. This could lead to growth in the German TV advertising market of EUR 100 million compared to 2010. The ProSiebenSat.1 Group’s goal is to shift advertising market share from print media to TV and to increase its revenues in the German TV advertising market further.
The changes in media usage behavior are driven largely by technological developments. Due to innovations such as large flatscreens as well as HD-ready and internet-enabled television sets, the appeal of television has continued to grow in the last few years. In the first nine months of 2012, every second television set sold in Germany was internet-enabled; according to GfK, this equates to approximately 3.5 million sets. These technological innovations open up growth opportunities for the ProSiebenSat.1 Group, particularly in the distribution of its HD stations. The Group is represented in the HD packages of all major cable, satellite and IPTVIPTV Stands for Internet Protocol Television (IPTV). Films and television are transmitted over the internet — and in contrast to traditional broadcasting, not via cable or satellite. IPTV is neither a standard nor a design, and therefore only a generic term that may be encountered in various forms. operators with its German free TV stations SAT.1, ProSieben, kabel eins, and sixx, and since 2011 has been taking a share in the technical activation fees which customers pay to the providers. The company anticipates that the technical reach of HD televisions will double by 2015 and that the number of HD subscribers will rise to approximately seven million. This corresponds to an annual growth rate of 75%. For this reason, the Group expects an increase in revenues of more than EUR 50 million from its HD distribution business by 2015 compared to 2010.
There are also growth prospects for the ProSiebenSat.1 Group in the video-on-demandVideo-on-demand Allows the user to stream or download videos at any time. area. As part of its digital video strategy, ProSiebenSat.1 has developed maxdome as Germany’s leading video-on-demand platform. Today, maxdome is already directly available on more than 70% of all hybrid TVHybrid TV Hybrid TV refers to televisions and set-top boxes that have an in-built internet interface so they can show TV and internet content. sets. In the last few years, ProSiebenSat.1 has concluded contracts with all major manufacturers relating to the integration of the service on the respective devices. By the end of 2013, maxdome is likely to be receivable on more than 13 million hybrid devices, meaning the number of maxdome users is likely to grow considerably.
While the TV industry is going through a dynamic process of change, the German television market is, at the same time, heavily regulated. For this reason, liberalization in the regulatory environment as well as new media law conditions generally entails growth opportunities for our company. As of July 1, 2012, advertising for betting and lotteries was legalized. Thus, the ProSiebenSat.1 Group anticipates that the German TV advertising market could grow by approximately EUR 80 million by 2015. In addition, a sponsorship ban on public television came into force on January 1, 2013 due to a change to the Interstate Broadcasting Treaty. The ban applies on workdays after 8 p.m. as well as on Sundays and public holidays. On the basis of a conservative estimate, the ProSiebenSat.1 Group numbers the potential revenues resulting from this for the private television market in Germany by 2015 at approximately EUR 25 million in comparison with 2010.
Since the ProSiebenSat.1 Group generates the majority of its revenues from TV services financed through advertising, the Group’s position is also influenced by the economic environment. Macroeconomic factors such as the development of gross domestic product as well as private consumption impact on revenues in the TV advertising business. This also applies to revenues from the online advertising market. Thus, macroeconomic developments that turn out better than originally forecast and that increase the purchasing power of consumers as well as the bookings of the advertising industry can have a positive impact on the Group’s revenues and earnings.
The Group not only invests on a continuous basis in the expansion of its existing programs, but
also sees opportunities for growth relating to the corporate strategy in the expansion of its
complementary station portfolio. In the last six years, the ProSiebenSat.1 Group has successfully
established five new stations in its German-speaking markets. The dynamic development
of the women’s channel sixx, which was launched in Germany in 2010, is an example showing
that there will be attractive opportunities for the traditional TV business in the future as well.
In 2012, the market share of sixx Deutschland doubled to 1.0%, while in Austria the women’s
channel — which was launched only in July 2012 — achieved a market share of 1.1% in the second
half of the year. The ProSiebenSat.1 Group is increasing its audience and advertising market
share through new TV stations, since it can offer its advertising customers a widely positioned
and diversified target group portfolio. In 2012, ProSiebenSat.1 also designed a station for “Best
SAT.1 Gold went on air in mid-January 2013 and is aimed primarily at
women between 49 and 64. In this way, the ProSiebenSat.1 Group is reacting to the demographic
change through which the population group of older, high-income people in Germany
is growing continuously.
The Group expects further growth potential from the development of new business models. We are at the forefront in the German advertising market in the adaption of new technologies and the implementation of innovative forms of advertising such as decentralized advertising in cable television. The station group plans to offer regional advertising spots to advertising customers in five areas. The Group has already successfully carried out technical pilot experiments for this with the network operators Kabel BW in Baden-Württemberg and Unitymedia in North-Rhine Westphalia. The media supervisory authority’s approval process is not yet complete. Above all, the ProSiebenSat.1 Group considers decentralized advertising a great opportunity to win new customers who have not previously advertised on television. It is already established in many other EU member countries.
Moreover, the international expansion of the Red Arrow Entertainment Group, the ProSiebenSat.1 Group’s program production and distribution company, provides opportunities for the Group. The TV group benefits from attractive program developments and productions from its own producer network. For example, in 2012 the German station group secured the broadcasting rights for several fictional programs from its own production pipeline. At the same time, revenues from the global sales business will grow in the next few years. Since 2010, the Red Arrow Entertainment Group has built up an attractive portfolio with 18 production companies worldwide, including in key markets such as the USA and Great Britain. In addition, the company has opened international sales offices, including a branch in China. The country is likely to be one of the fastest-growing TV markets in the next few years. More than 50% of all of the world’s TV households are in Asia. Approximately three years after it was founded, the Red Arrow Entertainment Group has established itself in the industry and is already the world’s eighth-largest independent production company.
Performance opportunities for the ProSiebenSat.1 Group can arise from operating business as
well as from cost management and the increase of efficiency and profitability. Opportunities
from operating business result in particular from the possibility to capitalize on our ratings
successes and to generate additional revenues on the basis of innovative sales concepts.
The biggest opportunities for growth will result from the leading position in the TV advertising market if ProSiebenSat.1 further increases the audience market share of its TV stations and continues to achieve adequate purchase prices for its high-quality media services through a corresponding price policy. As demonstrated in the 2012 study “ROI Analyzer”, carried out jointly by ProSiebenSat.1 advertising sales company SevenOne Media and GfK as well as the GfK Verein, TV advertising constitutes the most effective and powerful form of advertising in the long term. The correlation between advertising, customer loyalty, and buying was thus quantified and the long-term impact of TV advertising demonstrated for the first time. According to the results of the study, the average long-term return on investment (ROI) of the brands investigated so far is 1.9. The Group also benefits from the strength and effectiveness of television in the expansion of its own integrated media portfolio.
The ProSiebenSat.1 Group taps into related business areas such as online games, mobile and music by also selling its own products via its free TV stations, which have wide coverage. On the basis of this strategy, the company has built up an attractive Ventures portfolio with more than 50 partnerships and strategic investments since 2010. With its innovative media-for-revenue-share and media-for-equity revenue models, the ProSiebenSat.1 Group provides selected start-up companies with advertising time on its TV stations in return for a revenue share and/or equity. With this special sales concept, the Group can capitalize free advertising time and optimize the use of its media inventory. This provides ProSiebenSat.1 the opportunity to advance into new business areas and markets in the future as well, without weaknesses on the part of the investments having a direct financial impact on the Group.
Further, the optimization of costs in the Group opens up additional opportunities for growth. The implementation of efficient processes and structures forms a crucial basis for sustainably increasing our profitability. As part of its cost management, the Group reviews the entire value chain on a continuous basis and proactively includes future events in its cost planning as far as possible.
A gradual recovery of the global economy is to be expected in 2013. The IMF is currently forecasting
real growth of 3.5% after growth of 3.2% in 2012. Due to various measures to stimulate the
economy in emerging countries, the economy is expected to pick up again in the course of 2013.
At the same time, the fiscal conflicts in the USA have been settled for the time being. The continued
expansionary monetary policy of the Federal Reserve is likely to have a positive impact on
the European markets. However, high unemployment and falling purchasing power could mean
the situation in some European countries will remain tense: In the euro zone, the IMF expects
economic performance to decline again in 2013. However, the decrease is not expected to prove
as great as in the previous year at 0.2%.
In the course of 2013, the domestic economy in Germany could grow more strongly again and revive investment activity, provided the euro crisis does not get worse. The ifo Business Climate Index has recently risen three times in a row after a long phase of weakness. In addition, the German export economy is likely to return to its course of growth due to rising demand from outside Europe. In contrast, signs for private consumption are mixed: While the employment market situation remains stable, the increase in the employment rate slowed down over the course of 2012. Therefore, available household incomes are still expected to rise again, but somewhat more moderately. The forecasts for private consumption in 2013 range between plus 0.2% (Rheinisch-Westfälisches Institut für Wirtschaftsforschung, RWI) and 1.1% (Deutsches Institut für Wirtschaft, DIW). The forecast range for the expected development of real GDP in Germany ranges from growth of 0.3% (RWI) to 0.9% (DIW). However, all the forecasts entail downside risks due to the current uncertainty in the euro zone.
Since advertising expenditure consists of investments by companies, the development of advertising markets is always closely tied to the current and expected future general economic situation. In 2012, gross domestic product grew only slightly by 0.7%. The Association of German Advertisers (ZAW) estimates that the media’s net advertising revenues sank by 3.0%, primarily to the detriment of print media: The ZenithOptimedia agency group anticipates growth of 1.8% for TV in 2012. The World Advertising Research Center (WARC) forecasts growth of 2.0% in TV net advertising revenues. For 2013, estimates are positive (ZenithOptimedia: +1.9%; WARC: +1.5%).
The economic outlook for Austria and Switzerland — the relevant international TV markets for the ProSiebenSat.1 Group in future — are positive as well as the forecasts for TV advertising markets, as the following charts show:
1 Growth rate fo external revenues vs. 2010 from continuing operations.
2 Revenues without 9Live. External revenues.
The ProSiebenSat.1 Group expects to continue its profitable growth for the 2013 and 2014 projection period.
|12013 and 2014; against previous year; continuing operations. 2Excluding cash and cash equivalents of EUR 90.4 million from discontinued operations and before the receipt of proceeds from the sale of the Northern European activities.|
|Underlying net income from continuing operations||355.5||Increase|
|Net financial debt2||1,870.8||Reduction|
The ProSiebenSat.1 Group started the first quarter of 2013 positively and is aiming for a revenue
growth in the mid-single-digit percentage area for the 2013 and 2014 projection period. Especially
our growth areas outside the traditional TV advertising business will make a significant contribution
In 2013 and 2014, the ProSiebenSat.1 Group will further expand in the core TV business with the launch of new free TV stations. In the Digital & Adjacent segment, the Group will continue to grow both organically and through targeted acquisitions. Naturally, operating costsOperating costs Total costs excluding depreciation and amortization as well as non-recurring expenses. Relevant cost variable for calculating recurring EBITDA. will rise as a result of these growth initiatives. For our core free TV business, we anticipate a moderate cost increase. Overall, we expect a further recurring EBITDARecurring EBITDA Earnings before Interest, Taxes, Depreciation and Amortization. Describes earnings before interest, taxes, depreciation andamortization, adjusted for non-recurring items. rise and are likely to achieve a considerably above-average margin in future as well. As a result, underlying net incomeUnderlying net income Consolidated net income adjusted for amortization and impairment taken on intangible assets identified in the context ofbusiness combinations and thus the related tax effects. in the projection period is likely to be higher than the figure for 2012.
|EUR m||Revenues||Recurring EBITDA||Revenues||Recurring EBITDA|
|12013 and 2014; against previous year; continuing operations.|
|Broadcasting German-speaking||1,909.5||660.3||Slight increase||Stable development|
|Digital & Adjacent||351.2||89.7||Significant increase||Significant increase|
|Content Production & Global Sales||95.4||4.3||Significant increase||Significant increase|
After the sale of the Northern European TV and radio activities, the total growth potential from continuing operations by 2015 is more than EUR 600 million compared to 2010. We are aiming to increase our revenue share outside traditional TV advertising on a continuous basis. ProSiebenSat.1 aims to achieve dynamic growth in these areas by 2015.
With an equity ratio of 27.7% as of December 31, 2012, the Group is in a solid financial position.
For 2013 and 2014 projection period, we anticipate maintaining solid capital funding, even though
the equity ratio is likely to fall, in line with expectations, due to the planned dividend payment.
With the intended repayment of further loans totaling EUR 500 million from the sale of
the Northern European TV activities,
the Group will reduce its borrowings further. After
we already repaid a significant part of our term loans and extended the maturities of most of
the remaining term loans in 2011, our financing is secured at attractive conditions on a long-term
basis. However, we are monitoring the financial markets very closely and regularly review
options for refinancing or extending the maturities of our loans, in order to optimize our capital
As of the reporting date, the ProSiebenSat.1 Group recorded a high level of cash and cash equivalents. With the sale of the Northern European TV and radio portfolio, our financial scope for investments in business operations will widen. From the current perspective, there is thus sufficient liquidity and financing headroom for 2013 and 2014. Further earnings growth is likely to impact positively on liquidity and thus also net financial debt. We set a target range of 1.5 to 2.5 for our financial leverage, and we are adhering to it.
The capital expenditure volume in the 2013 and 2014 projection period is likely to be at least at the level of the 2012 financial year. In the future, the largest part of our investments — between EUR 800 and EUR 900 million — will continue to go into the programming assetsProgramming assets Rights to TV program content (e.g. feature films, series, commissioned productions) capitalized as a separate item due to their particular importance for the financial position and performance at the ProSiebenSat.1 Group. Feature films and series are posted on the statement of financial position as of the beginning of the license term. Commissioned productions are capitalized as broadcast-ready programming assets as of their date of formal acceptance. Until being broadcast, sport rights are included in advance payments. They are then posted to programming assets. When programs are broadcast, a program consumption item is posted in the income statement. of the Broadcasting German-speaking segment. Further investments will mainly be in the Digital & Adjacent segment and will primarily include intangible assets and acquisitions. This also includes media-for-equity deals, through which ProSiebenSat.1 secures access to new markets, without having to make any larger cash investments. A significant part of the investments will occur using the disposal proceeds from the sale of the Northern European activities.
Our dividend policy is based on underlying net income. Generally, the payout ratio is approximately
80% to 90% of the
underlying net incomeUnderlying net income Consolidated net income adjusted for amortization and impairment taken on intangible assets identified in the context ofbusiness combinations and thus the related tax effects. from continuing operations adjusted for
special items. The dividend proposal is newly set for each financial year. Here, ProSiebenSat.1
Group’s corporate development and the required capital base for growth initiatives and the
current business prospects are taken into account.
Notwithstanding the previously described general dividend policy, the Group intends to pay out a higher dividend for the 2012 financial year. If the sale of the Northern European TV and radio activities is successfully consummated, we plan to invest part of the proceeds from the sale in the Group’s operating business. As a result, the operating cash flow is largely available for other purposes, such as the dividend payment. Therefore, the Executive Board intends to propose to the Annual General Meeting — in coordination with the majority shareholder of the Company, Lavena — a dividend expected to be EUR 5.65 Euro per preference share (previous year: EUR 1.17) and EUR 5.63 per share of common stock (previous year: EUR 1.15) for 2012 should the above-mentioned sale be consummated successfully. Thus, the Company would pay out a total of approximately EUR 1.2 billion (previous year: EUR 245.7 million). After the payment, the ProSiebenSat.1 Group’s leverageLeverage Shows how high net debt is in relation to recurring EBITDA in the last twelve months. factor will remain in the target range of 1.5 to 2.5 communicated previously, based on the Group’s ratio of net financial debt to recurring EBITDA. The Company is again anticipating a payout ratio of approximately 80% to 90% of the underlying net incomeUnderlying net income Consolidated net income adjusted for amortization and impairment taken on intangible assets identified in the context ofbusiness combinations and thus the related tax effects. from continuing operations adjusted for special items in subsequent years.
In addition, the Company intends to propose to the Annual General Meeting for the 2012 financial year a conversion of the non-voting preference shares into voting common stock. As part of this conversion, which is to be carried out without requiring a premium on the part of the holders of preferred stock, all common stock would be listed for trading. The majority shareholder supports the conversion provided that the disposal of the Northern European activities is successfully consummated. Along with the approval of the Annual General Meeting — in which the majority shareholder has the required majority of votes — the conversion of preference shares into common stock also requires an approval resolution from the holders of preferred stock, which needs a qualified majority of 75% of votes in order to be valid.
|Our forecast is based on current assessments of future developments. Examples of risks and uncertainties which can negatively impact this forecast are a slowing of the economic recovery, a decline in advertising investments, increasing costs for program procurement, changes in exchange rates or interest rates, negative rating trends or even a sustained change in media use, changes in legislation, regulatory||regulations or media policy guidelines. Further uncertain factors are described in the Risk Report. If one or even more of these imponderables occurs or if the assumptions on which the forward-looking statements are made do not occur, then actual events can deviate materially from the statements made or implicitly expressed.|