Financial

Annual Report & Accounts 2014

1 January 2014127 pages57,176 words

Summary

Modern Times Group recorded a solid top‑line expansion in 2014, with net sales rising 11 % to SEK 15.7 billion on a constant‑exchange‑rate basis. Growth was split between 4 % organic increase and a further 7 % generated by acquisitions, notably the 2013 purchase programme that expanded the group’s presence in the Nordic pay‑TV and emerging‑market segments. Operating profit slipped modestly, falling 3–4 % to roughly SEK 1.3 billion and delivering an 8.1 % operating margin, while cash flow remained robust and net debt was cut to 0.2 × EBITDA, half the level of the prior year. The board proposed, and shareholders approved, a cash dividend of SEK 10.50 per share—about 57 % of net income—resulting in a payout of SEK 700 million. At year‑end the market capitalisation stood at SEK 16.8 billion, with 17,721 shareholders; the ten largest owners held 47 % of the equity and 64 % of voting rights, and Swedish institutional investors owned roughly 59 % of the shares. Segment performance was mixed. Free‑TV Scandinavia delivered flat revenue with a slight profit decline, while Pay‑TV Nordic posted an 8 % sales increase and a 14 % rise in operating profit. Broadcasting contributed SEK 13.2 billion of the total revenue and generated SEK 2.12 billion of operating profit, marginally below the previous year. The group continued to hedge virtually all USD and EUR programme‑acquisition exposures, maintaining a SEK 137 million hedging reserve, and held full‑coverage insurance on its assets. Corporate governance was overseen by a seven‑member board, four of whom were classified as independent, supported by remuneration, audit and a newly created corporate‑responsibility advisory committee. The board approved all major investments, acquisitions and disposals above SEK 2 million. Financial statements were prepared under IFRS, with joint ventures now accounted for using the equity

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Annual Report & Accounts 2014

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