Financials
2022
Financials
Description of our financial performance in 2022
Report of the Board of Directors
for 2022
.............................................................. 2
Consolidated Financial
Statements
................................................... 41
Parent Company Financial
Statements
................................................. 114
Board’s proposal
for distribution of profits
.................125
Signatures of the Board ................... 125
Auditor’s Report ..................................... 126
Independent Auditor’s
Reasonable
Assurance Report
on Sanoma Corporation’s
ESEF Financial Statements ........... 131
Information for investors ................ 133
SANOMA ANNUAL REPORT 2022
∙
1
Report of the Board of
Directors for 2022
Strategic review ..........................................................................3
Financial review .........................................................................4
Financial position ......................................................................5
Cash flow ..........................................................................................5
Acquisitions and divestments .........................................5
Events during the reporting period .............................6
Strategic Business Units ...................................................... 6
Personnel ......................................................................................... 9
Non-financial information ................................................. 9
EU Taxonomy disclosure ...................................................16
Risks and risk management ...........................................21
Outlook for 2023 .......................................................................30
Corporate Governance .......................................................30
Annual General Meeting 2023 ......................................32
Dividend proposal ..................................................................32
Shares and shareholders ..................................................32
Events after the reporting period ...............................34
Key impacts of the war in Ukraine .............................34
Alternative performance measures and
discontinued operations
...................................................34
Key indicators and share indicators ........................35
Reconciliation of certain key figures ........................39
SANOMA ANNUAL REPORT 2022
∙
2
Report of the Board of Directors 2022
Strategic review
Sanoma continued its successful transformation and
growth strategy in 2022. In August, Sanoma acquired
Pearson’s local K12 businesses in Italy and Germany. With
the acquisition, Sanoma entered the large and growing
Italian K12 learning services markets, which increased
the number of its operating countries to twelve and
strengthened its position as one of the global leaders in
K12 education. In addition, the company’s learning service
offering in certain niche areas was expanded with smaller
acquisitions in the Netherlands and Poland. In 2022, more
than 50% of the Group’s net sales and more than 70%
of earnings were attributable to the stable and resilient
learning business.
In Learning, a long-term strategic project to harmonise
the digital platform offering progressed well during the
year. On top of enhanced efficiency in developing and
introducing better digital solutions to the market, the
harmonisation will further enhance the user experience and
accessibility of the products. During the year, significant
investments in learning content development were also
made. A major part of them was driven by the curriculum
renewal in Spain that started in 2022, and will continue
in 2023–2024. Both investments are expected to bring
benefits and support organic growth in the coming years.
In Media Finland, successful transformation from print to
digital continued both in the B2C and B2B businesses. During
the year, there was clear growth in the number of visits to
all digital news platforms, especially Ilta-Sanomat, and the
digitally active subscription base of both Helsingin Sanomat
and the regional news media titles. The second half of 2022
was characterised by a moderate slowdown in the economy
due to inflationary pressures caused by the Ukraine war
and the energy crisis, which was visible especially in B2B
advertising demand. Media Finland has a reasonably
balanced business portfolio, with 51% of net sales
attributable to the relatively stable B2C, mainly subscription,
business and 49% to the B2B business in 2022. Within B2B,
print advertising represented only 25% of net sales.
Sustainability is deeply rooted into the purpose of
Sanoma’s learning and media businesses which have
a positive impact on the lives of millions of people every
day. During the year, the company focused in particular on
enhancing its climate strategy by sending it for validation
to the Science Based Target initiative. Further focus was
on enhancing diversity, equality and inclusion (DE&I). The
company conducted a DE&I survey among all employees
and started a training programme on the topic.
During the year, Sanoma announced its strategic ambition
to grow the Group’s net sales to over EUR 2 billion by 2030,
with at least 75% coming from the learning business.
Growth levers include organic growth in-line with Sanoma
Learning’s long-term target of 2–5% p.a. and growth
through acquisitions within K12 learning business. Sanoma
may consider funding also through equity if it would create
value for all shareholders.
More information on acquisitions in 2022 in chapter
Acquisitions and divestments. More information on
sustainability in Sanoma's Sustainability Report.
618
615
563
681
637
500
Data Table
2020
2021
2022
Learning
500
637
681
Media Finland
563
615
618
Group total
1,062
1,252
1,298
Learning
Media Finland
1,298
Net sales by SBU,
m
€
2020
2021
2022
1,062
1,252
1
52%
Learning's share of
Group's net sales
SANOMA ANNUAL REPORT 2022
∙
3
Financial review
The Group’s net sales grew to EUR 1,298 million
(2021: 1,252) mainly as a result of the acquisition of
Pearson Italy and Germany. The Group’s comparable net
sales growth was 1% (2021: 7%).
Operational EBIT excl. PPA declined to EUR 189 million
(2021: 197), corresponding to a margin of 14.6% (2021:
15.8%). Earnings were stable in Learning. The acquired
Pearson business had a positive earnings impact as did
the solid growth in the learning content business in all
major markets except Poland. This was offset by the loss-
making Dutch distribution business and inflationary costs,
especially paper costs. In Media Finland, earnings declined
mainly due to lower advertising sales and higher paper
costs. The improvement in Other operations’ earnings was
mainly driven by changes in adjustments of short-term and
long-term bonuses.
EBIT was EUR 112 million (2021: 142). The IACs increased
to EUR -38 million (2021: -16). The restructuring expenses
consisted mainly of transaction and integration costs
of recent acquisitions as well as strategic business
development costs. Impairments were related to
harmonisation of digital learning platforms and rental
book inventory in Spain. PPAs amounted to EUR 39 million
(2021: 39).
Net financial items increased to EUR -13 million (2021: -9).
Interest expenses increased mainly due to the funding to
acquire Pearson Italy and Germany at the end of August
and higher interest rates. The average interest rate of
external loans was 1.5% (2021: 1.1%). The net financial
items also included a positive EUR 3 million impact from
revised valuation related to M&A liabilities in Q2 2022.
Result before taxes declined to EUR 99 million (2021: 134)
due to the weaker operational result as well as higher
IACs and financing costs. Income taxes declined to EUR
22 million (2021: 32) mainly due to lower earnings and
changes in deferred taxes. Result for the period was EUR
77 million (2021: 101) and EUR 77 million (2021: 101)
including discontinued operations.
Operational earnings per share were EUR 0.65 (2021:
0.69) and EUR 0.65 (2021: 0.69) including discontinued
operations. Earnings per share were EUR 0.47 (2021:
0.62) and EUR 0.47 (2021: 0.61) including discontinued
operations.
IACS, PPAS AND RECONCILIATION OF OPERATIONAL EBIT
EUR million 2022 2021
EBIT 112.0 142.4
Items affecting comparability (IACs)
Restructuring expenses -27.2 -15.2
Impairments -11.6 -4.3
Capital gains/losses 0.9 3.7
IACs total -37.9 -15.8
Purchase price allocation adjustments and amortisations (PPAs) -39.3 -39.0
Operational EBIT excl. PPA 189.3 197.2
66
74
67
132
134
96
Data Table
2020
2021
2022
Learning
96
134
132
Media Finland
67
74
66
Other operations
-6
-10
-8
Group total
157
197
189
Learning
Media Finland
Other operations
Operational EBIT
excl. PPA by SBU,
m
€
157
197
189
-8
2020
2021
2022
-6
-10
1
A detailed reconciliation on SBU level is presented at the end of the Report of the Board of Directors in chapter Reconciliation
of certain key figures.
SANOMA ANNUAL REPORT 2022
∙
4
Financial position
At the end of December 2022, net debt amounted to EUR
823 million (2021: 616), and net debt to adjusted EBITDA
ratio was 3.2 (2021: 2.4) being slightly above the long-term
target of below 3.0. Net debt and leverage ratio increased
as a result of the acquisition of Pearson Italy and Germany,
which was completed during the third quarter and funded
with a new EUR 250 million 4-year term loan. Equity ratio
was 35.8% (2021: 40.6%) being within the long-term target
range of 35–45%.
At the end of December 2022, the Group’s equity totalled
EUR 702 million (2021: 721) and the consolidated balance
sheet amounted to EUR 2,104 million (2021: 1,933).
Cash flow
In 2022, the Group’s free cash flow declined to EUR 112
million (2021: 140) or EUR 0.68 per share (2021: 0.86). The
acquired business in Italy and Germany had a significant
positive impact on the free cash flow due to the timing
of the acquisition, which was near the end of its annual
high season, and thus the cash and receivables included
in the acquisition were on a high level. In addition, the net
impact of the VAT claim pre-payments related to magazine
distribution (more details below under Events during the
reporting period) had a positive impact on free cash flow.
Lower earnings including transaction and integration costs
of recent acquisitions, together with higher working capital,
increased investments particularly in learning content
creation and digital learning platforms, as well as higher
taxes paid for strong 2021 result, reduced free cash flow. For
dividend calculation purposes, the Group’s free cash flow will
be adjusted for the VAT pre-payment of EUR 11 million and
the operational cash flow of the acquired Italian and German
businesses of EUR 58 million and thus the underlying free
cash flow amounted to EUR 65 million.
In 2022, capital expenditure included in the Group’s free
cash flow amounted to EUR 53 million (2021: 42) and mainly
consisted of growth investments in digital platforms and ICT
in Learning as well as maintenance investments.
Acquisitions and divestments
On 4 October, Sanoma divested Eduarte, a Dutch student
administration system provider for vocational education, in
line with the strategy to harmonise its digital offering across
the learning business. Net sales of the divested business
were EUR 9 million in 2021 and the company employed 45
people who transferred to the buyer with the divestment.
On 7 June 2022, Sanoma announced the acquisition of
Pearson’s local K12 learning content business in Italy and its
small exam preparation business in Germany. Net sales of
the acquired businesses were EUR 117 million and adjusted
EBITDA was EUR 30 million in 2021. The agreed enterprise
value is EUR 190 million, corresponding to a multiple of
6.4x (EV / adjusted EBITDA 2021). The acquisition marks
Sanoma’s entry into Italy, one of the largest K12 learning
services markets in Europe. The acquired businesses have
251 employees and they became employees of Sanoma
Learning at the closing of the acquisition. The transaction
was completed on 31 August 2022 and EUR 5 million of
transaction costs were booked as IACs in the third quarter.
After closing, the acquired businesses are reported as part of
Sanoma Learning SBU.
Development of
fi
nancial position
2020
2021
2022
823
616
661
Data Table
Legend
2020
2021
2022
Interest-bearing net
debt, m€
661
616
823
Net debt / adj.EBITDA
2.6
2.4
3.2
Equity ratio, %
37.4%
40.6%
35.8%
35.8%
40.6%
37.4%
Net debt, m€
Net debt / adj.EBITDA
Equity ratio, %
2.4
2.6
3.2
1
2020
2021
2022
112
140
95
0.68
0.86
0.58
0.68
0.86
0.58
Data Table
Legend
2020
2021
2022
Free cash flow, m€
95
140
112
Free cash flow per
share, €
0.58
0.86
0.68
Free cash flow, m€
Free cash flow per share, €
Free cash
flow
1
SANOMA ANNUAL REPORT 2022
∙
5
On 3 January 2022, Sanoma sold its newspaper printing
facility Savon Paino, located in Varkaus, Finland, to media
company Keskisuomalainen. 36 employees of Savon Paino
were transferred to Keskisuomalainen with the divestment.
Printing of certain Sanoma products continue at Savon
Paino with long-term contracts. The transaction did not
have a material financial impact on the Group.
Information on acquisitions and divestments conducted in
2021 and earlier is available at sanoma.com.
Events during the reporting period
On 16 December, Sanoma received a payment decision
from the Finnish Tax Administration regarding the tax
audits at Sanoma Media Finland Oy for years 2019–2021,
concerning the treatment of value added tax (VAT) of
certain magazines that were printed in multiple locations
in Europe, and processed in and distributed through a
centralised logistic centre in Norway. Sanoma considers
also the new claim wholly unjustified and will appeal from
the decision. Based on the decision received, Sanoma paid
EUR 11 million of VAT, penalties and interests at year end
2022 in order to avoid interest accumulation. No provisions
related to the matter were made. The decision is in line with
the earlier decision concerning years 2015–2018 by the
Finnish Tax Adjustment Board, as a result of which Sanoma
was required to pay EUR 25 million of VAT, penalties or
interests in 2021. Sanoma considers the claims wholly
unjustified and has appealed from the decision to the
administrative court, where the process is still ongoing. The
VAT regulations have changed as of 1 July 2021 and thus
further tax audits related to the matter are not expected.
Starting 1 December 2022, Sanoma’s share was included
in the Nasdaq OMX Sustainability Finland Index. The
inclusion followed Sanoma’s Prime C+ rating from ISS ESG
Corporate Rating.
On 7 November 2022, Sanoma signed a EUR 300 million
syndicated revolving credit facility with a group of ten
relationship banks. The new facility replaced the revolving
credit facility of the same size, which would have expired
in February 2024. The new facility has a maturity of three
years and includes two one-year extension options at the
discretion of the lenders. The facility will be used for general
corporate purposes. At the same time, Sanoma’s EUR 250
million 4-year term-loan, signed on 7 June 2022 and used
for the financing of the acquisition of Pearson Italy and
Germany at the end of August, was syndicated to the same
banking group. As a result, the total syndicated amount was
EUR 550 million.
On 21 June 2022, Sanoma announced the composition
of its Shareholders’ Nomination Committee, which was
resolved to be established at the Annual General Meeting on
7 April 2022. The four largest shareholders have appointed
the following members to the Shareholders’ Nomination
Committee: Juhani Mäkinen (Vice Chair of the Board, Jane
and Aatos Erkko Foundation), Antti Herlin (Chair of the
Board, Holding Manutas), Robin Langenskiöld (3rd largest
shareholder in Sanoma) and Rafaela Seppälä (4th largest
shareholder in Sanoma). In its meeting on 21 June 2022, the
Committee elected Juhani Mäkinen as a Chair of the Committee
and invited Pekka Ala-Pietilä, Chair of Sanoma’s Board of
Directors, to serve as an expert in the Committee.
On 13 June 2022, Sanoma changed its trading code from
SAA1V to SANOMA and issuer code from SAA to SANOMA.
On 7 June 2022, Sanoma announced its strategic growth
ambition to increase the Group’s net sales to over EUR 2 billion
by 2030, with at least 75% coming from the learning business.
Growth levers include organic growth in-line with Sanoma
Learning’s long-term target of 2–5% p.a. and growth through
acquisitions within K12 learning business. Sanoma may
consider funding also through equity if it would create value
for all shareholders. Sanoma’s long-term financial targets and
dividend policy, according to which Sanoma aims to pay an
increasing dividend equal to 40–60% of annual free cash flow,
remain unchanged.
Strategic Business Units
In 2022, Sanoma Group included two strategic business units
(SBU), Sanoma Learning and Sanoma Media Finland.
SANOMA ANNUAL REPORT 2022
∙
6
Learning
Sanoma Learning is one of the global leaders in K12
education, serving over 25 million students in 12 European
countries. Our learning products and services enable
teachers to develop the talents of every child to reach their
potential. We offer printed and digital learning materials
as well as digital learning and teaching platforms for K12,
i.e. primary, secondary and vocational education, and we
aim to continue to grow our business in Europe and beyond.
We develop our methodologies based on deep teacher and
student insight and truly understanding their individual
needs. By combining our educational technologies and
pedagogical expertise, we create learning products and
services with the highest learning impact.
KEY INDICATORS
EUR million 2022 2021 Change
Net sales 681.0 637.3 7%
Operational EBITDA
1
212.8 213.1 0%
Operational EBIT excl. PPA
2
131.8 133.9 -2%
Margin
2
19.4% 21.0%
EBIT 67.2 90.5 -26%
Capital expenditure 40.4 33.7 20%
Average number of
employees (FTE) 2,717 2,599 5%
¹ Excluding IACs
2
Excluding IACs of EUR -32.2 million in 2022 (2021: -11.1) and PPA
adjustments and amortisations of EUR 32.5 million in 2022
(2021: 32.2).
Full reconciliation of operational EBITDA and operational EBIT excl.
PPA is presented in a separate table at the end of the Report of the
Board of Directors in chapter Reconciliation of certain key figures.
Net sales of Learning grew to EUR 681 million (2021: 637).
The acquired Pearson Italy and Germany made a EUR 37
million contribution to the net sales growth for September-
December. Comparable net sales growth in Learning was
1% (2021: 7%) with the strongest growth in Spain and the
Netherlands. In Spain, growth was driven by the first year of
the curriculum renewal, which will continue in 2023–2024.
In the Netherlands, growth was mainly attributable to an
increase in content sales driven by both market demand
and market share gains. Modest growth was achieved
also in all other content businesses as well as in the Dutch
distribution business. In Poland, net sales declined as
expected following the ending of the latest curriculum
renewal in 2021.
Operational EBIT excl. PPA was stable and amounted
to EUR 132 million (2021: 134). The acquired Pearson
business had a positive impact on earnings. Earnings in
learning content businesses improved slightly in all major
markets, partially offsetting the decline in Poland. The Dutch
distribution business was loss-making due to inflationary
cost pressures, shortage of labour, late deliveries from
publishers and tight competitive situation during the third
quarter high season, even though its earnings improved in
the fourth quarter. Inflationary costs, especially paper, had
an adverse impact on earnings.
EBIT declined to EUR 67 million (2021: 91). IACs increased
to EUR -32 million (2021: -11) and mainly consisted of the
transaction and integration costs of recent acquisitions as
well as impairments related to harmonisation of digital
platforms and rental book inventory in Spain. PPAs were
EUR 33 million (2021: 32).
Capital expenditure increased to EUR 40 million (2021: 34)
mainly as a result of higher growth investments in digital
platforms and ICT.
Net sales by country,
m
€
45
84
60
31
130
109
223
Data Table
Legend
Value in %
Exact value
The
Netherlands
33%
223
Poland
16%
109
Spain
19%
130
Italy
5%
31
Finland
9%
60
Belgium
12%
84
Other
countries
and
eliminations
7%
45
Total
681
The Netherlands
Poland
Spain
Italy
Finland
Belgium
Other countries and eliminations
Total
681 m€
1
SANOMA ANNUAL REPORT 2022
∙
7
Media Finland
Media Finland is the leading cross-media company in
Finland, reaching 97% of all Finns weekly. We provide
information, experiences, inspiration and entertainment
through multiple media platforms: newspapers, TV, radio,
events, magazines, online and mobile channels. We have
leading brands and services, such as Helsingin Sanomat,
Ilta-Sanomat, Aamulehti, Me Naiset, Aku Ankka, Nelonen,
Ruutu, Supla and Radio Suomipop. For advertisers, we are a
trusted partner with insight, impact and reach.
KEY INDICATORS
EUR million 2022 2021 Change
Net sales 618.1 615.3 0%
Operational EBITDA
1
150.2 155.0 -3%
Operational EBIT excl. PPA
2
65.8 73.5 -11%
Margin
2
10.6% 11.9%
EBIT 54.3 60.6 -10%
Capital expenditure 8.9 4.9 83%
Average number of
employees (FTE) 2,160 2,072 4%
1
Excluding IACs
2
Excluding IACs of EUR -4.6 million in 2022 (2021: -6.1) and PPA
adjustments and amortisations of EUR 6.9 million in 2022
(2021: 6.8).
Full reconciliation of operational EBITDA and operational EBIT excl.
PPA is presented in a separate table at the end of the Report of the
Board of Directors in chapter Reconciliation of certain key figures.
Net sales of Media Finland were stable and amounted
to EUR 618 million (2021: 615). Sales of digital and radio
advertising grew, while print and TV advertising sales
declined in line with the long-term trend. This led to a
decline in total advertising sales. Subscription sales were
stable with continued growth in digital subscription sales
and decline in print. Other sales grew, driven by events and
higher paper prices applied for external printing services.
According to the Finnish Advertising Trends survey for
December 2022 by Kantar TNS, the advertising market
in Finland was stable year-on-year on a net basis in
2022, partially due to the strong development in outdoor
advertising, in which Media Finland is not active in.
Advertising grew by 5% in online excluding search and
social media (10% including search and social media) and
by 4% in radio. Advertising declined by 11% in magazines,
by 7% in newspapers and by 3% in TV.
Operational EBIT excl. PPA declined to EUR 66 million (2021:
74). Earnings were mainly impacted by different sales mix
with lower advertising sales and higher sales in the lower
margin external printing and events businesses. In addition,
higher paper costs had a negative impact on earnings
despite being partially offset by savings in fixed costs
resulting from continued active cost management actions.
EBIT amounted to EUR 54 million (2021: 61). IACs totalled
EUR -5 million (2021: -6) and mainly consisted of costs
related to strategic business development. PPAs were EUR 7
million (2021: 7).
Capital expenditure totalled EUR 9 million (2021: 5) and
consisted of maintenance investments. The increase was
due to the transfer of certain technology and real estate
operations from Other operations to Media Finland as well
as investments in adapting offices to the hybrid way of
working.
Net sales by category,
m
€
321
298
Data Table
Legend
Value in %
Exact value
Print
48%
298
Non-print
52%
321
Total
618
Print
Non-print
Total
618 m€
1
Net sales by category,
m
€
96
39
247
236
Data Table
Legend
Value in %
Exact value
Advertising
sales
236
Subscription
sales
247
Single copy
sales
39
Other
96
Total
618
618
Advertising sales
Subscription sales
Single copy sales
Other
Total
618 m€
1
SANOMA ANNUAL REPORT 2022
∙
8
Personnel
In 2022, the average number of employees in full-time
equivalents (FTE) was 5,018 (2021: 4,885). The average
number of employees (FTE) per SBU was as follows:
Learning 2,717 (2021: 2,599), Media Finland 2,160
(2021: 2,072) and Other operations 141 (2021: 214). The
increase in Learning was mainly due to the acquisition
of Pearson in Italy and Germany. The transfer of certain
technology and real estate teams from Other operations
to Media Finland affected the distribution of employees
between these two units.
At the end of December, the number of employees (FTE) of
the Group was 5,079 (2021: 4,822).
Employee benefit expenses remained relatively stable and
amounted to EUR 356 million (2021: 351).
Personnel by SBU,
FTE
, average
2020
2021
2022
Data Table
2020
2021
2022
Learning
1,987
2,599
2,717
Media Finland
2,052
2,072
2,160
Other operations
216
214
141
Group total
4,255
4,885
5,018
Learning
Media Finland
Other operations
5,018
216
141
4,255
4,885
1
Non-financial information
As a leading and growing K12 learning company and the
leading cross-media company in Finland, Sanoma plays an
important role in society and has a positive impact on the
lives of millions of people every day. Sustainability is inbuilt
into Sanoma’s businesses. Sanoma creates value in society
by providing inclusive learning solutions to teachers, so
that they can help all students achieve their full potential. In
Finland, Sanoma provides independent and trusted media,
which is essential for an open and democratic society.
Sanoma’s Sustainability Strategy, published in March 2021,
consists of six themes: Inclusive learning, Sustainable
media, Valued people, Trustworthy data, Vital environment,
and Responsible business practices. With its Sustainability
Strategy, Sanoma is committed to the United Nations’
Sustainable Development Goals (SDGs). Sanoma’s Code of
Conduct and its policies and practices are built upon global
conventions and commitments and applied across the
Group. All policies are approved by the Board.
Sanoma’s Sustainability Strategy relates to the themes
covered by the Non-Financial Reporting Directive (NFRD):
environment, employee and social issues, human rights,
and anti-bribery and corruption. In addition to this NFRD
review, more information on sustainability is available in
the Sustainability Report prepared according to the Global
Reporting Initiative (GRI) standards, the Sustainability
Accounting Standard Board’s (SASB) standards and Task
Force on Climate Related Disclosure (TCFD) guidelines.
Sanoma’s EU Taxonomy Disclosure can be found in chapter
EU Taxonomy disclosure in the Report of the Board of
Directors.
Sanoma’s business model, as well as role and impacts in
its value chain are described in more detail in the value
creation model below. Risks related to non-financial
aspects are reported under Risks and risk management.
Sanoma’s governance structure and framework is
presented in the Corporate Governance Statement.
SANOMA ANNUAL REPORT 2022
∙
9
Value creation model
Our value creation model summarises Sanoma’s business model as well as Sanoma’s role and impacts in its value chain.
Sanoma uses resources and inputs in developing, producing and distributing learning and media content and offering
services. This model also describes the most material outputs of Sanoma’s business operations, and their impacts on
Sanoma’s audiences, customers, society and other stakeholders. All figures presented are for continuing operations in 2022.
Inputs Business activities Outputs Impacts
Operational
■
Systems and applications
■
Own and external printing facilities
■
Transportation and distribution
■
User data
Human, social & intellectual
■
Committed and diverse personnel
(more than 5,000 employees at the
end of 2022) and freelancers, who
have competence and know-how in
learning and media content creation,
innovation and development
■
Key stakeholder relations and
engagement with teachers,
readers and users to understand
customers’ needs
Financial
■
Equity 702 m€
■
Net debt 823 m€
Natural
■
Energy used 43 GWh
■
Paper used 70,900 tonnes
Operational, intellectual & social
■
Modern learning materials, methods
and digital platforms
■
Independent, high-quality journalism
■
Local entertainment
■
Optimal reach and targeting
for successful and
responsible advertising
■
Customer value by responsible
use of data
■
New products and solutions to meet
the changing customer needs
Human
■
Engaged diverse employees
■
Increased knowledge and knowhow
Financial
■
Earnings
1
189 m€
■
Employee benefits 351 m€
■
Net financial items -13 m€
■
Taxes and employer charges 98 m€
■
Free cash flow 112 m€
■
Dividends paid 89 m€
Natural
■
GHG emissions 157,100 tCO
2
/e
Learning materials,
methods &
digital platforms
Media content
Advertising
Business
development
Leadership
and talent
management
Data & privacy
Governance framework
Our products have a
positive impact on the
lives of millions of people
every day.
Customers are
at the heart
of everything we do.
We think and work
according to our values.
1
Operational EBIT excl. PPA
■
Our products have a positive impact
on the lives of millions of people
every day
■
Our modern, high-quality materials,
methods and digital platforms
support high learning results and
contribute to the successful and
stable development of societies
■
Our independent, high-quality
journalism supports freedom
of speech and increases
people’s awareness and
intellectual capital
■
We enrich people’s lives by
entertainment contributing to shared
values and experiences
■
We contribute to economic
growth via responsible advertising
and employment
■
We support users' awareness about
the benefits of data and
their trust in our data integrity
■
We play an active role in the
responsible and forward-looking
development of the learning and
media industries
■
We work to minimise the environment
and climate impact across our
value chain
SANOMA ANNUAL REPORT 2022
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10
Valued people:
Social and employee matters
As a creative and technological organisation, people and
their innovativeness are key to Sanoma’s success. The
future growth of the company is dependent on retaining
and attracting talented people and supporting them in their
development. Sanoma’s growth strategy and the changing
business environment require new skills and competences,
such as the right digital competences, both from our current
and future employees. The Group’s strength as an employer,
is that it offers meaningful work with a strong purpose and
flexible working arrangements. The focus is on creating a
working environment that inspires people by developing
the employee experience, people’s competences, and
sense of belonging. The key challenges are related to
ensuring balance and wellbeing in the changing working
environment.
Sanoma’s Diversity and Inclusion Policy sets the ambition
for a diverse and inclusive workplace with fair treatment
and equal opportunities, non-discrimination, equal pay for
equal roles, and gender-neutral experience. The Policy is
approved by the Board of Directors. In most of the Group’s
operating countries, equality actions are centred around
local equality and non-discrimination plans.
In 2022, Sanoma took important steps in advancing
diversity and inclusion (D&I). It carried out a D&I survey in
collaboration with a third party and launched an online
course for all employees on understanding unconscious
biases and promoting inclusion on individual, team
and organisational levels. In the Learning and Group
organisations, a virtual training for close to one hundred
leaders was provided to support them in leading by
example and promoting D&I. In Media Finland, a new
Leadership handbook was created and trained to
managers with the ambition of driving the implementation
of the leadership promises and equal practices.
Sanoma has zero tolerance for any form of discrimination,
harassment or bullying at the workplace. Sanoma’s Code of
Conduct sets out the general principles of ethical conduct
and Sanoma’s responsibilities as an employer.
The Human Resources Committee is responsible for the
evaluation of related policies, practices, development
plans and performance of the key executives. Sanoma’s
human resources management model ensures well-
organised management of, and employee participation
in the development, implementation, and evaluation of
occupational health and safety, as well as wellbeing.
Outcomes and performance
In 2022, Sanoma employed more than 5,600 people across
12 countries. In 2022, Sanoma recruited 963 (2021: 616)
new employees, while 892 (2021: 617) employees left
the company, resulting in an average employee turnover
of 16.5% (2021: 11.5%). The higher employee turnover
was in line with the post-pandemic averages in Sanoma’s
operating countries. In addition, more than 250 new
colleagues joined the company through the acquisition of
Pearson Italy and Stark Germany in August 2022.
In addition to acquisitions and divestments, no significant
workforce restructurings or redundancies took place during
the year. 42% (2021: 41%) of employees have worked for
Sanoma for more than ten years. The commitment to the
right of freedom of association and collective bargaining
is embedded into Sanoma’s Code of Conduct. At the end
of 2022, 69% (2021: 68%) of Sanoma employees were
covered by collective bargaining agreements.
Sanoma conducts an annual Employee Engagement Survey
for all its employees. In 2022, the Employee Experience
Index (EEI) was stable at 7.3 (2021: 7.3). Sanoma’s EEI
remains above the industry benchmark level of 7.1.
Sanoma’s long-term target level for the EEI is 7.5.
In 2022, the EEI result made up 10% of Sanoma’s short-term
executive management incentives and the performance
outcome on the Group level was within the target range.
RESULTS OF THE EMPLOYEE ENGAGEMENT SURVEY (EES)
2020 2021 2022
Employee Experience Index (EEI)
1
7.4 7.3 7.3
Response rate % 88 90 87
1
EEI is a 10-item index measured in the annual employee
engagement survey, scale 1–10
SANOMA ANNUAL REPORT 2022
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11
Starting from 2022, Sanoma introduced a target for gender
diversity. By 2030, Sanoma aims for a 50/50 gender
balance in managerial positions (i.e., managers with
subordinates). In 2022, 56% (2021: 55%) of all employees
were women and 44% (2021: 45%) men. 44% (2021: 45%)
of team managers and 41% (2021: 39%) of directors or
senior management were women. The Board has set a
measurable objective regarding the representation of both
genders: both genders shall be represented in the Board
with the share of the under-represented gender being at
least 40%. Where two candidates are equally qualified,
priority will be given to the candidate of the under-
represented gender. In 2022, 33% (2021: 33%) of Board
members were women.
Trustworthy data:
Privacy and information security
As both Learning and Media Finland offer digital content,
matters related to information security and data protection
are important for Sanoma. Sanoma’s Group-wide Privacy
Programme ensures that the company continuously
develops the responsible use of personal data in
compliance with privacy laws. Sanoma focuses on fair
and transparent practices defined in the Privacy and Data
Protection Policy. Privacy is incorporated into product and
business development through a ‘Privacy-and Security-
by-Design’ process. Sanoma’s Privacy Programme is
supported by a separate Information Security Programme
to build robust information security measures across the
organisation and protect personal data and other key data
assets. There is a team of information security experts
supporting the implementation of the Information Security
Policy and standards and implementing security controls
consistently across the organisation.
Sanoma actively monitors relevant authority and industry
guidelines related to privacy and information security
and develops guidance and training to implement legal
requirements in practice. Internal Audit reviews the Privacy
and Data Protection Policy implementation on a regular
basis, and compliance is reported on a bi-annual basis
to the Audit Committee. Third parties processing data on
Sanoma’s behalf are expected contractually to comply with
Sanoma’s Supplier Code of Conduct and Data Processing
Agreement, which defines and instructs suppliers on data
protection measures which need to be implemented on
Sanoma’s behalf.
In 2021–2022, specific emphasis was put on assessing
how suppliers transfer data especially outside the
European Economic Area, in accordance with the guidance
provided by the European Data Protection Board regarding
such transfers following the so called “Schrems II”
decision in 2020.
There were various authority enforcement actions across
the EU during 2021 and 2022 regarding consent practices
for the use of cookies and similar identifiers. While these,
along with the expected ePrivacy Regulation, are benefiting
the national media and advertising industry in the long
term by creating a level playing field for national vs
international media players, in the short term, they have
an impact on media cookie consent practices and require
adaptations in the technical platforms and practices.
Outcomes and performance
Sanoma closely follows the number of data breaches
in Sanoma Learning and Media Finland. During 2022,
Sanoma had a total number of 196 (2021: 282) personal
data breaches, out of which none (2021: 0) was considered
a major one. Most of the breaches occurred in the media
business B2C sales domain, and typically were related to
a single customer’s data. The number of data breaches
in Media Finland decreased in 2022 due to implemented
technical corrective measures and training of sales teams
that helped reduce human errors. Sanoma did not receive
any formal substantiated complaints, notices, orders or
penalties related to personal data breaches from the
regulatory authorities during 2022.
44%
56%
59%
50%
67%
56%
44%
41%
50%
33%
Data Table
Legend
Female
Male
Board of Directors
33%
67%
Executive Management Team
50%
50%
Directors and Senior Management
41%
59%
Managers with Subordinates
44%
56%
Employees
56%
44%
Female
Male
Board of
Directors
Executive
Management
Team
Directors and
Senior
Management
Managers with
Subordinates
Employees
Gender diversity at Sanoma,
% at the end of 2022
1
SANOMA ANNUAL REPORT 2022
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12
Media consumers have the right to ask Sanoma as a data
controller to provide them access to, and to correct or delete
their data, if needed. Media Finland received 80 (2021: 67)
consumer requests for data access, deletion and portability,
out of 1.4 million subscriptions in total.
Sanoma’s Code of Conduct e-learning, mandatory for all
employees, contains dedicated sections for privacy and
security. In addition, privacy trainings were tailored for
various business roles that include more specific privacy
responsibilities. 98% (2021: 97%) of all employees
participated in the Code of Conduct training.
In 2022, data and privacy related targets made up 10% of
Sanoma’s short-term executive management incentives
on target level. The performance outcome was within the
target range.
Vital environment: Climate and biodiversity
Sanoma’s climate strategy is an important part of its 2030
business strategy, transforming the business to meet
the requirements of a low-carbon economy. In late 2022,
Sanoma updated its climate targets to align with the
Science Based Target initiative. Targets are currently being
validated and we expect the validation results to be ready
during the third quarter of 2023 at the latest.
Following the updated science-based climate targets,
Sanoma aims to annually reduce CO
2
-emissions from own
operations by 4.2%. All in all, this means a 38% reduction
by 2030 from a 2021 base year, in addition to the earlier
emission reduction measures. In 2021, Sanoma already
reduced its own operations’ (Scope 1 & 2) emissions by
more than 50% from 2020. Scope 1 covers direct emissions
from owned or controlled sources, including reserve
power consumption and company cars. Scope 2 covers
indirect emissions from the generation of purchased
energy consumed in facilities, warehouses and printing
houses used by Sanoma. Scope 3 includes all other indirect
emissions that occur in the company’s value chain.
95% (2021: 94%) of Sanoma’s greenhouse gas emissions
derive from its value chain (Scope 3). With the updated
science-based climate target, Sanoma aims to annually
reduce Scope 3 GHG emissions also by 4.2%, corresponding
to a 38% decline by 2030 from the 2021 base year. This
Scope 3 target applies to categories (Scope 3 categories
1, 3, 4 and 9) that have the biggest impact on Sanoma’s
GHG emissions – printed products, services (e.g. as
marketing, consulting, TV production services) and
transportation – and account for more than 75% of Scope 3
emissions.
In addition to the Science Based emission reduction targets,
Sanoma aims to be carbon neutral in all operations in
2030. This means that in 2030, Sanoma’s aim is to take
responsibility for the emissions that cannot be avoided by
compensating.
Climate-related risks and opportunities are reported
according to the Task Force on Climate-related Financial
Disclosure (TCFD) framework, including a detailed
description of the management of climate-related
topics. Sanoma’s TCFD disclosure is available in the
Sustainability Report.
In addition to climate action, Sanoma acts to safeguard
biodiversity with a goal that all paper qualities used by
Sanoma originate from sustainable, certified sources by the
end of 2023.
Sanoma owns two printing houses in Finland, which
operate according to the ISO 14001 environmental
management system. Sanoma monitors the use of paper
and minimises the use of printing plates, ink, wetting water
additive and water as well as energy to minimise the
greenhouse gas emissions.
To manage the environmental impacts in the value chain,
Sanoma’s key policies and principles include the Supplier
Code of Conduct and the Paper Procurement Standard. All
business partners and suppliers are expected to uphold
the Supplier Code of Conduct, a key element in Sanoma’s
supplier management system. The Supplier Code of
Conduct is included in the terms of contract with all key
suppliers.
Outcomes and performance
In 2022, Sanoma’s direct and indirect greenhouse gas
(GHG) emissions totalled 157,100 tCO
2
e (2021: 162,400).
Scope 1 and Scope 2 GHG emissions were 5% (2021: 6%)
and Scope 3 GHG emissions 95% (2021: 94%) of the total
GHG emissions. Scope 1 and 2 emissions declined 7%
compared to 2021. Emissions in Scope 3 categories
1, 3, 4 and 9, covered by Sanoma’s Science Based targets,
declined by 8.2%. Sanoma’s emission intensity decline
despite the growth of the business.
SANOMA ANNUAL REPORT 2022
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13
The consumption of electricity, district heating and cooling
in both own and leased properties declined to 43 GWh
(2021: 49). The energy use declined mainly as a result of
previous years’ energy efficiency projects, office floorspace
restructurings as well as the divestment of a printing
house in Finland, Savon Paino. In total 92% (2021: 97%)
of electricity and 57% (2021: 59%) of all energy used was
renewable. The target is to use only renewable electricity by
the end of 2023.
In 2022, the total amount on paper used declined by 9%.
In Media Finland, paper usage continued to decline driven
by the prevailing media trend of consumers moving from
printed to hybrid and digital media products. In Learning,
the use of book paper grew in-line with net sales and
business growth and due to the acquisition in Italy.
At the end of 2022, 94% (2021: 95%) of paper used
originated from certified sources. The share of certified
fibre decreased in books and magazines, as suppliers
were unable to ensure the use of only certified paper due
to availability issues. In Sanoma’s own printing houses,
the share of certified fibre increased to 97% (2021: 94%).
Sanoma’s target is to use only paper made of certified
wood fibre by the end of 2023. This requires further
intensifying of follow-up methods.
GREENHOUSE GAS (GHG) EMISSIONS AND INTENSITY
2021 2022
Change against
base year 2021
Scope 1 and 2. Own operations direct and indirect GHG emissions total, tCO
2
e 9,000 8,300 -7.0%
Scope 3. Value chain indirect GHG emissions total, categories 1, 3, 4 and 9, tCO
2
e 121,400 111,500 -8.2%
GHG emission intensity in own operations: Scope 1 and 2 GHG emissions,
tCO
2
e/employees 1.7 1.5 -11.2%
GHG emission intensity in own and value chain: Scope 1, 2 and 3 GHG emissions,
tCO
2
e/employees 30.3 28.0 -7.6%
GHG emission intensity in own and value chain: Scope 1, 2 and 3 GHG emissions,
gCO
2
e/€ net sales 0.13 0.12 -6.7%
Emissions calculated according to the GHG protocol. Emissions calculation restated in 2021 to include acquired Pearson Italy and Stark
Germany and to meet a 95% calculation coverage, as required by the Science Based Target initiative for target-setting. Learn more about
Sanoma’s GHG emissions calculation methodology in the Sustainability Report.
ENERGY INTENSITY
2020 2021 2022
Change,
Year-on-Year
Energy consumption of the organisation, MWh 46,800 49,000 43,300 -11%
Share of carbon neutral electricity used, % - 97% 92%
Share of carbon neutral energy used, % - 59% 57%
Energy intensity, MWh/employees 11.0 9.1 8,0 -15%
PAPER AND SHARE OF CERTIFIED FIBRE USED
2020 2021 2022
Change,
Year-on-Year
Newsprint, tonnes 33,700 38,100 30,300 -20%
Magazine paper, tonnes 6,900 6,400 6,000 -7%
Book paper, tonnes 17,000 20,300 34,600 71%
Total, tonnes 57,700 64,700 70,900 9%
Share of certified paper used 85% 95% 94%
Includes paper used in Sanoma’s own printing facilities for own and externally sold print products, as well as paper acquired for own
products printed by third parties. Book paper is used in Learning and newsprint and magazine paper in Media Finland. Figures include
continuing operations.
SANOMA ANNUAL REPORT 2022
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14
Responsible business practices: Anti-
bribery, anti-corruption, and potential
adverse human rights impacts
Sanoma is committed to respecting the international
standards on human rights, freedom of speech, labour
conditions, environment and anti-corruption as defined
in the Ten principles of the UN Global Compact, the UN
Guiding Principles on Business and Human Rights and
the Universal Declaration of Human Rights. Sanoma
also commits to respecting the ILO’s Declaration on
Fundamental Principles and Rights at Work. In its
operations and governance, Sanoma follows laws and
regulations applicable in its operating countries, ethical
guidelines set by the Sanoma Code of Conduct (Code) as
well as the Group’s internal policies and standards. Policies
define how Sanoma’s operations are managed and give
a framework to daily work. The Code and key policies are
enforced annually through a mandatory e-learning. All new
employees should complete the Code of Conduct e-learning
in their first month of employment. In the newly acquired
companies, the e-learning takes place typically within 3–6
months after the acquisition is completed.
Concerns of misconduct or unethical behaviour may be
reported anonymously via Sanoma’s externally operated
misconduct reporting system, Sanoma-WhistleB hotline,
which is available both for employees and external
stakeholders. Possible cases of misconduct or unethical
behaviour are also identified during internal audits or
through other internal channels. All cases and conclusions
of investigations are reported to the Ethics and Compliance
Committee and the Audit Committee.
Sanoma’s Anti-Bribery and Corruption Policy gives specific
rules and monetary limits for received and given gifts (EUR
75), and entertainment and hospitality (EUR 100), and sets
out the process to seek further approval through a separate
gift and hospitality tool if necessary. When it comes to
public officials, gifts of any value must not be offered to
or accepted from public officials unless approved by a
management team member.
Sanoma’s Supplier Code of Conduct sets out the
responsible business principles its suppliers are required
to comply with and expected to apply to their employees,
affiliates, and sub-contractors. Sanoma has a Know Your
Counterparty (KYC) process to identify possible risks and
non-compliance in doing business with third parties.
Outcomes and performance
Sanoma’s Code of Conduct e-learning is compulsory
to all employees. Dedicated sections of the e-learning
ensure that general ethics, anti-bribery and corruption
rules, competition law, privacy, security, and compliance
in supplier relationship management are familiar to
employees. The Code of Conduct e-learning was updated in
2021 and completion of it was required from all employees
again in 2022. From 2022 onwards, existing employees
are annually reminded of ethics and principles of the Code
through a mandatory Code of Conduct e-learning. In 2022,
98% (2021: 97%) of employees completed the Code of
Conduct e-learning. In newly acquired companies, the
e-learnings take place typically within 3–6 months after the
acquisition is completed.
Our Supplier Code of Conduct (the Supplier Code) sets out
the ethical standards and responsible business principles
our suppliers are required to comply with and expected
to also apply to their employees, affiliates, and sub-
contractors. The Supplier Code is an integral part of our
standard contractual procurement framework, including
supplier selection, evaluation and performance appraisal.
The Supplier Code is based on recognised international
standards, principles and best practices on human rights,
labour conditions, environment and anti-corruption. The
supplier selection for new key suppliers follows Sanoma’s
strategic sourcing process, which incorporates the
Supplier Code as a mandatory step in supplier evaluation.
Tracking is done via Sanoma´s centralised contract lifecycle
management system by evaluating new suppliers above
100,000 EUR spend for the reporting year. In 2022, 86% of
new key suppliers above EUR 100,000 spend signed our
Supplier Code of Conduct.
SANOMA ANNUAL REPORT 2022
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EU Taxonomy disclosure
Consolidated disclosures pursuant
to Art. 8 Taxonomy Regulation
The European Union’s Sustainable Finance Classification
System (‘Taxonomy’) is a system for defining
environmentally sustainable economic activities. According
to the Taxonomy, an economic activity is classified as
environmentally sustainable if it contributes substantially
to one or more of the six environmental objectives, does
no significant harm (DNSH) to the other environmental
objectives (i.e., complies with DNSH technical screening
criteria in the delegated acts supplementing the Taxonomy
Regulation) and complies with Minimum Safeguards
related to the UN Guiding Principles, OECD Guidelines and
ILO conventions. The six environmental objectives defined
by the EU are:
1) climate change mitigation,
2) climate change adaptation,
3) sustainable use and protection of water and marine
resources,
4) transition to a circular economy,
5) pollution prevention and control and
6) protection and restoration of biodiversity and
ecosystems.
The Taxonomy Regulation (2020/852) of the European
Union entered into force in July 2020. For 2022, public
interest entities are, for the first time, required to report
the proportion of the Taxonomy-aligned and non-aligned
activities in addition to the Taxonomy-eligible and non-
eligible activities already reported in 2021. For 2022,
eligibility and alignment is reported for the first two
objectives, climate change mitigation and climate change
adaptation, with three KPIs, turnover, capex and opex, all
according to the Taxonomy accounting policies.
Under the Taxonomy, aligned and eligible activities
currently focus on the most carbon-intensive industries,
green energy and innovations. As a learning and media
company, Sanoma’s environmental footprint is not
significant, and consequently only a few of its businesses
are defined as Taxonomy-eligible activities and none are
Taxonomy-aligned. Sanoma’s Taxonomy disclosure is
based on our first assessment of Taxonomy-eligibility in
2021 and first assessment of Taxonomy-alignment in 2022.
The assessment was conducted in internal workshops with
representatives from the businesses, sustainability, and
finance operations. According to Sanoma’s assessment,
the following economic activities are identified as eligible
under the climate change adaptation objective: 8.2
Computer programming, consultancy and related activities
(digital learning businesses) and 8.3 Programming and
broadcasting activities (TV and radio broadcasting
business in Finland). None of the eligible activities were
identified to substantially contribute to the climate
change adaptation objectives and therefore none of the
activities are Taxonomy-aligned according to Sanoma’s
analysis. None of the activities include DNSH criteria.
Sanoma has reviewed and complies with the Minimum
Safeguards criteria related to the Taxonomy with respect
to human rights, bribery and corruption, taxation, and fair
competition.
Economic activities 13.1 Creative, arts and entertainment
activities (live events business in Finland) and 13.3 Motion
picture, video and television programme production, sound
recording and music publishing activities (Music publishing
business in Finland) were also found to be potentially
eligible for Sanoma, but to avoid double counting, Sanoma
reports all eligible turnover, capex and opex related to
Nelonen Media and these activities under economic activity
8.3. According to Sanoma’s assessment, the Taxonomy’s
economic activity 11, Education, only refers to organising
of public and private education, and thus does not cover
Sanoma’s K12 learning material and services business.
The Taxonomy list of potentially eligible activities does
not include any news media related economic activities
and therefore Sanoma’s news media business cannot be
reported as an eligible economic activity.
Taxonomy regulation and reporting requirements will
evolve in the coming years, and Sanoma will update its
Taxonomy assessment according to the requirements. In
2023 Sanoma will, e.g., conduct an eligibility and alignment
assessment for four currently pending environmental
objectives: sustainable use and protection of water
and marine resources, transition to a circular economy,
pollution prevention and control and protection and
restoration of biodiversity and ecosystems. According
to its initial analysis, Sanoma expects the eligibility and
alignment percentages to remain low as the learning and
media businesses are not significantly contributing to, nor
harming, the environmental objectives of the Taxonomy due
to the underlying nature of the businesses.
SANOMA ANNUAL REPORT 2022
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16
Taxonomy accounting policy
In the Taxonomy-eligible and Taxonomy-aligned turnover,
capex and opex is only accounted once, although some
taxonomy-eligible businesses would be eligible under
several economic activities.
Taxonomy-eligible and aligned turnover: Turnover
of Taxonomy-eligible economic activities is reported in
relation to the Group’s total net sales (Note 2.2), which
means the turnover of products and services associated
with Taxonomy-eligible economic activities is divided
with the Group’s consolidated net sales. The Taxonomy-
eligible turnover includes net sales of activity 8.3. Net
sales of economic activity 8.2. is not included in the
Taxonomy-eligible net sales, because this activity is not
an enabling activity. Taxonomy-aligned turnover would be
calculated following the same formula as eligible activities,
if the activity specific substantial contribution criteria
would be met.
Taxonomy-eligible and aligned capital expenditure:
Capex of Taxonomy-eligible activities is reported in
relation to the Group’s total capex. Total capex includes
additions in the Group’s tangible and intangible assets
during the year. The Taxonomy-eligible capex includes
additions in the tangible and intangible assets of all
Taxonomy-eligible activities. According to the Taxonomy
regulation, the total acquisition value of TV programming
rights is considered as Taxonomy-eligible capex under the
activity 8.3 forming a major part of Sanoma’s taxonomy-
eligible capex. In Sanoma’s financial reporting, the
acquisition of TV programming rights is excluded from the
cash-based capex. Taxonomy-aligned turnover would be
calculated following the same formula as eligible activities,
if the activity specific substantial contribution criteria
would be met.
Taxonomy-eligible and aligned operating expenses:
Opex of Taxonomy-eligible activities is reported in relation
to net opex. Net opex deviates from the Group’s operating
expenditure and includes direct non-capitalised costs
related to the use of Sanoma’s taxonomy-eligible economic
activities’ assets. The direct non-capitalised costs are
related to TV broadcasting, digital production, purchased
digital traffic, research and development (incl. related
employee benefit expenses), ICT development and short-
term leasing payments. Opex of Taxonomy-eligible activity
8.2 includes non-capitalised R&D costs (incl. employee
benefit expenses). Opex of Taxonomy-eligible activity
8.3 includes distribution expenses and direct employee
expenses of broadcasting activities. Taxonomy-aligned
turnover would be calculated following the same formula
as eligible activities if the activity-specific substantial
contribution criteria would be met.
SANOMA ANNUAL REPORT 2022
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SANOMA ANNUAL REPORT 2022
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Proportion of turnover from products or services associated with Taxonomy-aligned economic activities
Substantial contribution criteria
DNSH criteria
(Do No Significant Harm)
EU taxonomy eligible economic activities
Code(s)
Absolute turnover
Proportion of
turnover
Climate change
mitigation
Climate change
adaptation
Water and marine
resources
Circular economy
Pollution
Biodiversity and
ecosystems
Climate change
mitigation
Climate change
adaptation
Water and marine
resources
Circular economy
Pollution
Biodiversity and
ecosystems
Minimum safeguards
Taxonomy-aligned
proportion of turnover,
2022
Taxonomy-aligned
proportion of turnover,
2021
Category (enabling
activity)
Category (transitional
activity)
A. TAXONOMY-ELIGIBLE ACTIVITIES
% MEUR % % % % % % % Y/N Y/N Y/N Y/N Y/N Y/N Y/N % % E T
A.1. Environmentally sustainable activities
(Taxonomy-aligned)
Activity 8.2 Computer programming, consultancy
and related activities
J62 N/A N/A 0% 0% 0% 0% 0% 0% N/A N/A N/A N/A N/A N/A Y 0% 0% E
Activity 8.3 Programming and broadcasting
activities
J60 0 0% 0% 0% 0% 0% 0% 0% N/A N/A N/A N/A N/A N/A Y 0% 0%
Turnover of environmentally sustainable activities
(Taxonomy-aligned) (A.1) 0 0% 0% 0% 0% 0% 0% 0% 0% 0%
A.2 Taxonomy-Eligible but not
environmentally sustainable activities
(not Taxonomy-aligned activities)
Activity 8.2 Computer programming, consultancy
and related activities
J62 N/A N/A
Activity 8.3 Programming and broadcasting
activities
J60 179.2 13.8%
Turnover of Taxonomy-eligible but not
environmentally sustainable activities (not
Taxonomy-aligned activities) (A.2) 179.2 13.8%
Total (A.1 + A.2) 179.2 13.8% 0%
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Turnover of Taxonomy-non-eligible activities (B) 1,111.8 100%
Total (A + B) 1,298 100%
SANOMA ANNUAL REPORT 2022
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19
Proportion of CapEx from products or services associated with Taxonomy-aligned economic activities
Substantial contribution criteria
DNSH criteria
(Do No Significant Harm)
Economic activities
Code(s)
Absolute CapEx
Proportion of
CapEx
Climate change
mitigation
Climate change
adaptation
Water and marine
resources
Circular economy
Pollution
Biodiversity and
ecosystems
Climate change
mitigation
Climate change
adaptation
Water and marine
resources
Circular economy
Pollution
Biodiversity and
ecosystems
Minimum safeguards
Taxonomy-aligned
proportion of CapEx,
2022
Taxonomy-aligned
proportion of CapEx,
2021
Category (enabling
activity)
Category (transitional
activity)
A. TAXONOMY-ELIGIBLE ACTIVITIES
% MEUR % % % % % % % Y/N Y/N Y/N Y/N Y/N Y/N Y/N % % E T
A.1. Environmentally sustainable activities
(Taxonomy-aligned)
Activity 8.2 Computer programming, consultancy
and related activities
J62 0 0% 0% 0% 0% 0% 0% 0% N/A N/A N/A N/A N/A N/A Y 0% 0% E
Activity 8.3 Programming and broadcasting
activities
J60 0 0% 0% 0% 0% 0% 0% 0% N/A N/A N/A N/A N/A N/A Y 0% 0%
CapEx of environmentally sustainable activities
(Taxonomy-aligned) (A.1) 0 0% 0% 0% 0% 0% 0% 0% 0% 0%
A.2 Taxonomy-Eligible but not
environmentally sustainable activities
(not Taxonomy-aligned activities)
Activity 8.2 Computer programming, consultancy
and related activities
J62 7.7 2.5%
Activity 8.3 Programming and broadcasting
activities
J60 54.5 17.9%
CapEx of Taxonomy-eligible but not
environmentally sustainable activities
(not Taxonomy-aligned activities) (A.2) 62.2 20.4%
Total (A.1 + A.2) 62.2 20.4% 0%
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
CapEx of Taxonomy-non-eligible activities (B) 241.8 79.6%
Total (A + B) 304 100%
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Proportion of OpEx from products or services associated with Taxonomy-aligned economic activities
Substantial contribution criteria
DNSH criteria
(Do No Significant Harm)
Economic activities
Code(s)
Absolute OpEx
Proportion of
OpEx
Climate change
mitigation
Climate change
adaptation
Water and marine
resources
Circular economy
Pollution
Biodiversity and
ecosystems
Climate change
mitigation
Climate change
adaptation
Water and marine
resources
Circular economy
Pollution
Biodiversity and
ecosystems
Minimum safeguards
Taxonomy-aligned
proportion of OpEx, 2022
Taxonomy-aligned
proportion of OpEx, 2021
Category (enabling
activity)
Category (transitional
activity)
A. TAXONOMY-ELIGIBLE ACTIVITIES
% MEUR % % % % % % % Y/N Y/N Y/N Y/N Y/N Y/N Y/N % % E T
A.1. Environmentally sustainable activities
(Taxonomy-aligned)
Activity 8.2 Computer programming, consultancy
and related activities
J62 0 0% 0% 0% 0% 0% 0% 0% N/A N/A N/A N/A N/A N/A Y 0% 0% E
Activity 8.3 Programming and broadcasting
activities*
J60 0 0% 0% 0% 0% 0% 0% 0% N/A N/A N/A N/A N/A N/A Y 0% 0%
OpEx of environmentally sustainable activities
(Taxonomy-aligned) (A.1) 0 0% 0% 0% 0% 0% 0% 0% 0% 0%
A.2 Taxonomy-Eligible but not
environmentally sustainable activities
(not Taxonomy-aligned activities)
Activity 8.2 Computer programming, consultancy
and related activities
J62 12.8 30%
Activity 8.3 Programming and broadcasting
activities*
J60 11 21%
OpEx of Taxonomy-eligible but not
environmentally sustainable activities
(not Taxonomy-aligned activities) (A.2) 23.8 51%
Total (A.1 + A.2) 23.8 51% 0%
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
OpeX of Taxonomy-non-eligible activities (B) 19.2 49%
Total (A + B) 43 100%
Risks and risk management
Sanoma is exposed to numerous risks and opportunities,
which may arise from its own operations or the changing
operating environment in the short-term or long-term.
Sanoma divides its key risks into four main categories:
strategic, operational, non-financial and financial risks.
The most significant risks that could have a negative
impact on Sanoma’s business, performance or financial
status are described below. Under the different categories,
the most material risks are presented first. In addition to
the risks presented in this review, currently unknown or
immaterial risks may arise or become material in the future.
Significant near-term risks and uncertainties are reported
on a continuous basis in each Interim Report.
Sanoma’s Enterprise Risk Management Policy defines
the group-wide risk management principles, objectives,
roles, responsibilities and procedures also covering
sustainability and climate-related risks. The President
and CEO, supported by the Executive Management Team,
is responsible for defining risk management strategies,
procedures and setting risk management priorities. SBUs
are responsible for identifying, measuring, reporting, and
managing risks. The updated risk assessment results,
with related ongoing or planned mitigation actions, are
reported to the Audit Committee and, further, to the Board
of Directors, twice a year. Risk management and internal
control policies, processes, roles and responsibilities are
presented in more detail in the Corporate Governance
Statement 2022 and in the Sustainability section.
Strategic risks
Mergers & Acquisitions (M&A)
Sanoma’s strategic aim is to grow through acquisitions
primarily in Learning, but to a lesser extent also in Media
Finland. In Learning, Sanoma is looking for growth
opportunities in K12 learning services in new geographies
and to expand its offering in the current twelve operating
countries. In Media Finland, Sanoma is interested in
synergistic acquisitions in the chosen strategic focus areas
of news and feature, entertainment or B2B marketing
solutions. However, Sanoma may not be able to identify
suitable M&A opportunities or suitable targets may not
be available at the right valuation. Even if suitable M&A
opportunities were identified and feasible, there are several
risks related to M&A transactions. M&A risks may relate
to unidentified liabilities of the target companies or their
assets, changes in the market conditions, the inability
to ensure the right valuation and effective integration of
acquisitions or that the anticipated economies of scale
or synergies do not materialise. Future M&A transactions
may also be financed with debt, increasing Sanoma’s
overall indebtedness, which may, in turn, adversely affect
the availability, costs or other terms of future financing.
Regulation of M&A activity by competition authorities may,
among other things, also restrict or delay the Group’s ability
to engage in M&A transactions.
In 2022, the Group announced several transactions,
including the acquisition of Pearson’s local K12 learning
content business in Italy and its small exam preparation
business in Germany. The Pearson Italy and Germany
acquisition was completed on 31 August 2022, and the
acquisition is estimated to create synergies of EUR 2–3
million to be realised in full 18–24 months after closing. The
success of the recent and above-mentioned acquisitions
largely depends on the timely and efficient integration of
the business operations, processes and ways of working.
The process of integrating the acquired businesses into
Sanoma’s existing businesses involves uncertainties,
and there can be no assurance that Sanoma will be able
to integrate the businesses in the manner or within the
timeframe anticipated and achieve the anticipated benefits
of the acquisitions.
To focus its business on areas where it has clear competitive
advantages and leading market positions, the Group
has divested its non-core businesses in recent years. For
example, the Group completed the divestment in Eduarte,
a student administration system provider for vocational
education in the Netherlands in October 2022. In January
2022, the Group also divested one of its three newspaper
printing facilities, Savon Paino, located in Varkaus, Finland.
Sanoma may divest additional businesses in order to
further focus its operations, or for other reasons. Any future
divestments may be affected by many factors, such as the
availability of bank financing to potential buyers, interest
rates and competitors’ capacity, all of which are beyond the
Group’s control, and may also lead to exposure to indemnity
claims. There can be no assurance that the Group will
succeed profitably in the divestment of certain assets or that
such divestments will be possible on acceptable terms, or
at all. Such divestments may also require attention from the
Group’s management, taking its attention away from the
management of ongoing business.
Sanoma is actively mitigating these risks by actively
maintaining its industrial networks, proactively seeking
potential targets, working with well-known parties in
transaction processes and following its internal policies
and procedures in the decision-making, organisation
and follow-up concerning M&A transactions. Despite this,
SANOMA ANNUAL REPORT 2022
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there can be no assurance that the acquisitions will be
successful and that Sanoma will achieve its strategic aim of
acquisition-based growth.
Changes in customer preferences,
technology and industry trends
In learning, digital and hybrid (print and digital) learning
materials, methods and platforms have gradually been
gaining ground. The coronavirus pandemic has further
amplified the growing need for remote learning tools
and digital learning materials. In the learning material
distribution services, this shift is being paralleled by a
move from renting and selling books towards subscription-
based commercial models. Both trends and/or their
acceleration or slow-down may have an effect on the
operational performance, financial performance and/or
financial position of Learning. In addition, Learning is, by
nature, subject to seasonal fluctuation, with most of the
sales and earnings accrued during the second and third
quarters when the new school year starts, which further
increases the pressure to be able to respond to changes in
a timely manner.
With the continued development of alternative forms
of media, particularly digital media, the Group’s media
businesses and the strength of its media brands depend on
its continued ability to identify and respond to constantly
shifting consumer preferences and industry trends, as
well as its ability to develop new and appealing products
and services in a timely manner. Ongoing digitalisation is
currently the driving force behind many of these changes,
and the increasing use of mobile devices is changing the
way people consume media, with viewing time of free-to-
air television decreasing and online video consumption
increasing. The demographic structure in Finland may
have a further impact on these trends. The demand for
advertising derived from printed media has also been
in decline in recent years as advertisers shift to digital
channels. However, even the digital advertising ecosystem
is changing. For example, the deprecation of third-party
cookies may result in changes in business models related to
the sales of digital advertising.
To mitigate these risks, Sanoma is continuously developing
digital and hybrid learning and media products and
services. In addition, Sanoma maintains close and long-term
relationships with schools, teachers and governing bodies
and typically sells digital solutions and printed materials
together. The wide cross-media offering provides Sanoma
with a solid foundation to constantly develop its offering to
advertisers and to introduce new services, such as cross-
media solutions, native or branded and premium content.
However, there can be no assurance that Sanoma will be able
to adjust to and meet the changes in consumer preferences,
industry trends and technological developments in the
future. Failure to respond to market changes by developing
and/or adopting new products and services, through
both established and new platforms on a competitive and
profitable basis may result in the Group losing market share
in its established businesses to competitors.
Competitive environment
and threat of new entrants
The learning and media markets in which the Group
operates are highly competitive and include many
regional, national and international companies. In media,
competition is affected by the level of consolidation within
the Group’s markets as well as by the development of
alternative distribution channels for the products and
services offered by the Group. Competition may arise from
large international media and telecom companies entering
new geographic markets or expanding the distribution of
their products and services to new distribution channels,
which may have a significant effect on competition as these
companies enjoy high brand awareness and often have
greater financial and other resources to penetrate new
markets and gain market share. In addition, new entrants
in the market may be able to take advantage of alternative
forms of media and new technologies faster than the
Group and, therefore, gain market share from Sanoma’s
established businesses. In Learning, there is a similar risk
stemming from large international media companies,
digital entrants, educational technology companies,
open educational resources and user-generated content
or digital tools. Furthermore, Sanoma is exposed to
competition also from traditional publishers in different
countries.
To mitigate these risks, the Group’s ability to compete
effectively will require continuous efforts by the Group in,
among other things, sales and marketing, cost innovation
and investment in technology to respond to changes in
the markets. Although the Group currently holds strong
positions in its key markets, there can be no assurance
that it will be able to maintain these positions or that these
positions will enable the Group to compete effectively in
the future.
Changes in applicable laws,
regulations or the political environment
The Group’s operations are subject to various laws and
regulations in the countries in which the Group operates
and changes in such laws and regulations could have a
material effect on Sanoma’s ability to conduct its business
effectively. For example, changes in education-related
regulation could have a material effect on Sanoma’s
commercial propositions, technology or content investment
needs, or financial performance. Although legislation
SANOMA ANNUAL REPORT 2022
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related to learning is typically country-specific, which
limits the magnitude of said risk at the Group level,
Sanoma faces an increased legislative risk in Poland and
Spain, which both are large markets and where broad
or abrupt education-related legislative changes could
have a material effect on Learning. The introduction or
delay, pace, scope and timing of changes in education-
related legislation, or their reflections in public educational
spending, in the markets in which Sanoma operates –
most notably in Poland or Spain, but potentially also other
markets – may also influence the performance of Learning
as a whole. In media, any adverse developments affecting
the freedom of the press or source protection could have an
adverse effect on the performance of Media Finland.
Changes in taxation as well as in the interpretation of tax
laws and practices may have an effect on the operations of
the Group or on its financial performance (e.g. value-added
tax (“VAT”) applicable to Sanoma’s printed, digital and
hybrid products).
Tightening of consumer protection-related laws may
necessitate the amendment of some consumer media
sales business models, such as telesales, imposing
additional costs on Sanoma and having an adverse effect
on profitability. For example, the Finnish national law
implementing the Omnibus Directive (EU) 2019/2161
became applicable as of 1 January 2023. Furthermore,
the deterioration of publishers’ and broadcasters’
copyright protection or increase in legal obligations (such
as reporting or monetary obligations) towards original
authors of copyright protected works affects the Group’s
ability to provide its customers with new products and
services and may increase costs or impact the valuation
of balance sheet items related to acquiring and managing
copyrights.
Data is an increasingly essential part of Sanoma’s
business, putting privacy and consumer trust at the core
of the Group’s daily operations. Regulatory changes and
new guidance by authorities or regulatory enforcement
actions regarding the use of consumer or cookie data for
commercial purposes could, therefore, have an adverse
effect on Sanoma’s ability to utilise data in its business.
For example, the proposed regulation of the European
Parliament and of the Council concerning the respect for
private life and the protection of personal data in electronic
communications and repealing Directive 2002/58/EC
(Regulation on Privacy and Electronic Communication) may
require consent for telesales for subscriptions and may
also have a negative impact on cookie-related usage and
thus demand for digital advertising. This would have an
effect on business to consumer media sales and business
to business advertising both in news and video-on-demand
(VOD) businesses.
The Group may also be faced with the risk of overregulation
on the European or national levels, or different, potentially
tighter national interpretations of the EU-level regulation
in its operating countries. In particular, this risk is seen to
relate to sustainability, compliance, intellectual property
rights, data protection, digital transformation, consumer
protection and accessibility.
To mitigate these risks, Sanoma aims to anticipate
any changes by closely monitoring the regulatory
developments and adapting its business models
accordingly. However, implementing changes to its
business models in order to adapt to new regulations
is likely to impose additional costs and may take time.
Violations of any applicable laws or regulations could also
result in penalties and fines.
General economic and market conditions
The general economic and political conditions in Sanoma’s
operating countries and overall industry trends could
influence Sanoma’s business activities and operational
performance. In addition to the recently increasing global
risks, including geopolitical unrest, the cost and supply
of global commodities such as energy, and high inflation,
general economic conditions may be affected by various
additional events that are beyond Sanoma’s control, such
as natural disasters and pandemics. For example, the
COVID-19 pandemic has, in general caused a reduction in
business activity and financial transactions, lockdowns,
quarantines, labour shortages, supply chain interruptions,
additional precautionary activities, additional costs and
overall economic and financial market instability. Although
Sanoma’s diversified and well-balanced business portfolio
to a certain extent mitigates this type of risk, it may cause
disruptions to Sanoma, its employees, markets, suppliers
and customers, any of which could have a material adverse
effect on Sanoma’s business, operating model, financial
condition and/or results of operations.
In general, political risks associated with the performance
of Learning relate to the development of public and private
education spending especially during curriculum renewals.
Sanoma faces political risks particularly in Poland and
Spain, where changes in the political landscape could
have a material effect on Learning, as described above.
Moreover, changes in the overall economic environment
can affect Learning’s cost base, particularly the cost and
availability of paper and printing, as well as of personnel.
Such changes could also affect demand in segments where
it is the parents or students themselves, rather than the
government or schools, who pay for learning materials
such as by increasing the demand for second-hand books.
Such segments constitute a minority of Learning’s business.
SANOMA ANNUAL REPORT 2022
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In Media Finland, risks associated with business and
financial performance typically relate to advertising
demand and consumer spending. A significant proportion
of the Group’s sales is derived from advertising sales in
magazines, newspapers, television, radio and digital
(online and mobile) media as well as circulation sales
of printed media. Both of these sources of income
are sensitive to changes in the general economic
environment and consumer confidence, with advertising
sales being historically somewhat more sensitive to
economic downturns than circulation sales, particularly
in subscription sales. Moreover, changes in the overall
economic environment can affect Media Finland’s cost
base, particularly the cost and availability of paper and
printing, as well as of personnel and distribution costs. In
addition to increasing Media Finland’s direct operating
costs, higher cost inflation may have an adverse indirect
impact on the demand for its products and services.
Changes in the geopolitical situation in Finland, such
as Russia’s attack and war in Ukraine and Finland’s
application for a membership in the North Atlantic Treaty
Organisation (NATO), could have an indirect impact on
the business operations and financial performance of
Sanoma’s businesses in Finland.
Sanoma’s diverse business portfolio and actions to
manage the risks and costs related to prevailing and
expected economic conditions, partially mitigate these
risks. In 2022, approx. 52% (2021: 51%) of Sanoma’s net
sales was derived from learning, approx. 22% (2021:
23%) from single copy or subscription sales, approx.
4% (2021: 5%) from print advertising, approx. 14%
(2021: 15%) from non-print advertising and approx. 7%
(2021: 6%) from other sales.
Operational risks
Changes in the economic conditions
Changes in the general economic conditions may
be reflected in Sanoma’s operational and financial
performance. Cost inflation, especially salary inflation
and continuing high paper prices, is expected to continue
to have an impact on Sanoma’s operating costs. The
availability of newsprint paper, the paper quality most
used by Sanoma, has remained at its normal level since the
second quarter of 2022, but could be negatively impacted
by the availability and prices of energy, particularly gas
in Central Europe. Weakening confidence among Finnish
consumers, impacted by the war in Ukraine as well as
increasing inflation and interest rates, may have an adverse
impact on the demand for Media Finland’s products and
services. In addition, the weakening of the euro against
main currencies, including the U.S. dollar, may increase the
cost of the goods and services Sanoma buys in currencies
other than euro (e.g. hosting and TV content) and poses a
risk to Sanoma’s financial performance, albeit part of the
currency transaction risk is hedged with forward contracts.
Sanoma has been able to partially mitigate these impacts
on its financial performance through, for example, costs
management actions; however higher operating expenses
are expected to have an adverse impact on earnings
also in 2023.
Data and privacy risks
Data is an increasingly essential part of Sanoma’s products
and services in both Learning and Media Finland. The
Group holds large volumes of personal data, including
that of employees, customers and, in its assessment
businesses, students and citizens. Sanoma is subject to the
General Data Protection Regulation ((EU) 2016/679, “the
GDPR”), which sets strict requirements for implementing
data subject rights, and for companies to demonstrate
their accountability for complying with the regulation.
Non-compliance with the GDPR in Sanoma’s business and
operations, or potential inadequacy of the data protection
processes and practices may cause problems, difficulties or
additional costs to Sanoma. Any infringement of the GDPR
could adversely affect Sanoma’s reputation. Furthermore,
under the GDPR, a national data protection authority is
vested with the power to impose corrective actions, such
as temporary or definitive bans on processing, and to
impose administrative fines for breaches of the GDPR
up to EUR 20 million or 4% of the total worldwide annual
turnover of a company. The Directive on privacy and
electronic communications 2002/58/EC also imposes
requirements for online data collection and use. There
have been various authority enforcement actions across
the EU during 2021 regarding consent practices for the
use of cookies and similar identifiers. While these, along
with the expected ePrivacy Regulation, are benefiting the
media and advertising industry in the long term by creating
a level playing field for small media players, in the short
term they could also have a negative impact on media
through additional costs. Although Sanoma runs a privacy
programme that monitors development and enforcement
of privacy regulations, there can be no assurance that such
measures will be successful in ensuring compliance with
privacy laws, which could lead to penalties, significant
remediation costs and reputational damage to Sanoma.
In addition, Sanoma is exposed to potential data breaches
resulting from unauthorised or accidental loss of or
access to personal data managed by Sanoma or by third
parties processing data on Sanoma’s behalf. For example,
Sanoma’s or its third-party suppliers’ systems could be
vulnerable to unauthorised access, misuse, breaches
due to employee error or malfeasance, computer viruses,
SANOMA ANNUAL REPORT 2022
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attacks by hackers or other similar threats. Data is key
in the development of Sanoma’s products and services,
as it enables content and learning services to be better
tailored to the needs of customers, such as by providing
individualised learning paths and even more compelling
media content. Continuing the use of data in the future
is dependent on maintaining the trust of customers, and
potential data breaches could significantly undermine
this trust.
To mitigate these risks, Sanoma’s key privacy
implementation processes include conducting privacy
impact assessments, data lifecycle management,
negotiating data processing agreements with third parties,
information security measures to protect data, data breach
management procedures and the implementation of data
subject rights. However, there can be no assurance that
data breaches will not occur despite these efforts to prevent
such breaches or, in the event that breaches occur, that
Sanoma will be able to mitigate the effects of such a breach.
This could lead to reputational damage which could
ultimately lead to Sanoma’s inability to effectively compete
for future business and to potential cancellations of existing
contracts.
Information and Communications
Technology (ICT)
Functioning and reliable information and communications
technology systems are integral aspects of the Group’s
learning and media business. The systems include online
services, digital learning platforms, video-on-demand
platforms, newspaper and magazine subscriptions,
advertising and delivery systems, as well as various
internal systems for production control, customer relations
management and supporting functions. Information and
communications technology security risks may relate
to confidentiality, integrity and/or the availability of
information, as well as to reliability and compliance of data
processing. The risks can be divided into physical risks,
such as fire, sabotage and equipment breakdown and
logical risks, such as information security risks, including
increased threat of malware and cyber-attacks, hacking of
personal data or other sensitive data assets, and employee
or software failure. Additionally, the fragmentation of the
data landscape and legacy systems or failure in meeting
customer needs or local requirements when developing
or harmonising the digital offering could cause a delay or
hinder the Group’s digitalisation.
To mitigate these risks, Sanoma has continuity and
disaster recovery plans in place for its critical systems
and clear responsibilities regarding information and
communications technology security. Information security
controls include the use of threat intelligence capabilities,
cyber security incident detection capabilities, identity
and access management solutions, log management
capabilities and the use of external information security
audits. Sanoma’s insurance programme provides partial
coverage for insurable information security risk. Although
Sanoma has several information security control measures
in place, there can be no assurances that such measures
will be adequate to prevent failures of one or more of
the Group’s essential information and communications
technology systems, which could cause disruptions to its
business and reputational damage resulting from possible
data breaches.
Risks related to third parties
A wide network of third parties in a wide variety of countries
plays an integral role in Sanoma’s daily operations. Third-
party suppliers in Sanoma’s value chain include, among
others, technology solution and service providers, paper,
print and logistics suppliers as well as content providers
for both Learning and Media Finland. Therefore, risks
relating to the availability, price, quality, security and
delivery schedules of third-party suppliers are material for
Sanoma’s operations. These include during recent years
the increased use of external cloud-based services, the
functioning of which is strongly dependent on the usability
and accessibility of global internet connections. The
expanding global supply chain risks that are a combination
of, for example, geopolitics, the post-pandemic situation,
the economic environment, high inflation and production
factors may result in much tighter supply market conditions
and availability concerns.
Sanoma utilises freelancers to support its own editorial
staff in content creation. The status of freelancers and
related copyright legislation development may vary by
authority and country, but no individual case is estimated
to become material unless it escalates to concern a large
group of freelancers working for Sanoma. The development
in the status of freelancers or the related regulation may,
however, also increase the related costs.
In addition, certain advertising and marketing efforts are
executed with the help of third parties. The advertising
technology ecosystem consists of players, such as Google
and Facebook, that have dominant market power, which
may lead to an imbalance between their rights and
liabilities in agreements entered into with Sanoma.
Sanoma’s daily business is dependent on its ability to
identify sources of supply that meet Sanoma’s standards
and identified business, technology and sustainability
requirements, although Sanoma is not dependent on
individual suppliers. To mitigate third-party related risks,
Sanoma follows the guiding principles of supplier risk
SANOMA ANNUAL REPORT 2022
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management set out in the Group’s Procurement Policy,
Supplier Code of Conduct and legal framework, and the
most significant suppliers are selected through competitive
bidding and qualification processes. Suppliers and other
third parties are subject to a Know Your Counterparty
(KYC) process to identify any risks related to anti-bribery,
sanctions regulations and other issues. With suppliers most
relevant for Sanoma’s business continuity, Sanoma has set
up steering practices and supplier engagement to jointly
mitigate the identified risks, such as by increasing the
paper inventory and agreeing on steps to avoid problems
with newspaper delivery. If any of the key suppliers had to
be replaced abruptly, it could cause temporary business
interruptions and even increase costs.
Despite the processes and risk mitigation activities that
Sanoma has in place, Sanoma may not be able to ensure
that its suppliers or other third parties comply with all
relevant regulations and its internal policies and standards,
which could, for example, lead to legal processes and/or
reputational damage. In addition, cooperation with third
parties exposes Sanoma to certain data-related risks.
Intellectual Property Rights (IPRs)
The Group’s products and services largely consist of
intellectual property delivered through a variety of media.
Key intellectual property rights (“IPRs”) related to Sanoma’s
products and services are copyrights including rights to
make the copyright protected works available to the public,
trademarks, business names, domains and know-how
owned and licensed by the Group. In addition, the Group
conducts business in certain countries where the extent
of effective legal protection and enforcement of IPRs may
differ and, therefore, cause uncertainty. Moreover, despite
trademark and copyright protection, third parties may
copy, commercially exploit, infringe on or otherwise profit
from the Group’s proprietary rights without authorisation.
These unauthorised activities may be more easily
facilitated by the Internet. The scarcity of Internet-specific
legislation relating to trademark and copyright protection
or enforcement of rights, as well as effective and concrete
means to intervene with online IPR infringements, create
an additional challenge for the Group in protecting its
proprietary rights relating to its online business processes
and other digital rights, and failure to protect its proprietary
rights or IPRs could result in the loss or diminution in value
of these rights. Sanoma also uses a high volume of third-
party IPRs in its operations, which exposes it to possible
infringement claims from third parties. Such claims could
result in burdensome litigations and additional costs as
well as adversely affect Sanoma’s reputation, which could,
in turn, have a negative impact on Sanoma’s operations.
To mitigate these risks, the Group relies on copyright,
trademark and other intellectual property laws as well as
its group-wide IPR Policy and procedures to establish and
protect its proprietary rights in these products. However,
there can be no assurance that the Group’s proprietary
rights will not be challenged, invalidated or circumvented.
Business interruption, health and
safety and hazard climate-related risks
Operational disruption to the Group’s business may be
caused by a major disaster and/or external threats that
could restrict its ability to supply products and services
to its customers, including potential disruptions such
as internet or energy availability in the Group’s main
operating countries. The Group is exposed to various
health and safety and environmental risks, such as natural
disasters and hazards following climate change, that are
beyond Sanoma’s control and that could cause business
interruption and result in significant costs. External threats
including but not limited to pandemics, such as COVID-19,
terrorist attacks, strikes and weather conditions, could
affect the Group’s businesses and employees, disrupting
daily business activities. Also, any failure to maintain high
levels of safety management could result in physical injury,
sickness or liability to Sanoma’s employees, which could,
in turn, result in the impairment of Sanoma’s reputation or
inability to attract and retain skilled employees.
Despite Sanoma’s operational policies, efficient and
accurate process management and contingency planning,
there can be no assurance that these will be sufficient in
preventing any of the above-mentioned risks, or recovering
from such risks. To mitigate potential hazard physical
risks, Sanoma has continuity and disaster recovery plans
in place for its critical systems and operations, but there
can be, however, no assurance that these will be sufficient
in preventing such risks impacting Sanoma negatively.
Sanoma’s insurance programme provides coverage for
insurable hazard risks, subject to insurance terms and
conditions, but there can be no assurances that Sanoma’s
insurance coverage would adequately cover all or any of
such costs, if such an incident were to occur, which could
result in significant costs.
SANOMA ANNUAL REPORT 2022
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Non-financial risks
Talent attraction and retention
The Group’s success depends on having competent, skilled
and engaged management and employees, and on their
competencies and skills in developing appealing products
and services in accordance with customer needs in a
changing environment. Recruiting and retaining skilled
and motivated personnel may become increasingly
difficult as a result of various factors, including a shortage
of skills in the labour market and intensifying competition
for personnel. In addition, Sanoma’s involvement in M&A
transactions generally exposes it to the risk of employees,
including senior management and other key employees,
leaving before such projects are completed or the
acquired businesses integrated to Sanoma’s existing
business. Also, cultural differences, resistance to change or
uncertainty around successful adaptation of new (hybrid
and remote) working models may hinder the Group’s
performance or transformation. Should the Group fail
to attract, retain, develop, train and motivate qualified,
engaged and diverse employees at all levels, it could have
an adverse effect on the Group’s profitability and value
creation, competitiveness and development of its business
operations in the long term.
To mitigate these risks, Sanoma aims to enhance a
corporate culture that supports training, innovation,
creativity, diversity, as well as an ethical and efficient way
of working, for which the framework is set in Sanoma’s
Code of Conduct and Diversity Policy. Sanoma measures
employee engagement on an annual basis, and the results
are also linked to the executive and senior management
remuneration.
Climate change-related risks
Sanoma’s most significant environmental impacts derive
from greenhouse gas emissions caused by the energy and
materials used in its value chain. The availability and price
of forest commodities and energy pose a risk for Sanoma
and changes in them may potentially have an adverse
impact on the Group’s business and financial performance.
Sanoma is also exposed to a risk of increasing pricing
of energy due to carbon taxes both in its own operations
and in the supply chain. The effects of climate change are
wide-ranging and may bring, for example, considerable
social uncertainty, although Sanoma’s business is not
highly carbon intensive and climate change risks are not
estimated to have material financial impacts.
Sanoma mitigates climate-related risks through
its ambitious climate strategy and by developing
sustainability together with its stakeholders and working
alongside its suppliers to improve their sustainability
performance. To identify and control environmental and
climate-related risks and opportunities, Sanoma evaluates
them as part of its annual risk-assessment process. In
addition, Sanoma analyses its climate-related risks and
opportunities by using the Task Force on Climate-related
Financial Disclosure (TCFD) framework, which is available
in the Sustainability Report.
Risks related to human rights,
anti-corruption and bribery
Sanoma operates in twelve European countries and is
committed to conducting business in a legal and ethical
manner in compliance with local and international laws
and regulations applicable to its business as well as its
Code of Conduct. Nevertheless, there is a risk that Sanoma’s
employees or business partners may act in a way that
violates human rights or anti-corruption and bribery laws
and regulations or they may act unethically.
In Learning, Sanoma’s business partners mainly include
municipalities, other governmental units and schools, while
Media Finland, for example, uses many third-party content
providers.
To mitigate these risks for example, all of Sanoma’s
employees must comply with Sanoma’s Code of Conduct,
which supports the international standards on human
rights and labour conditions and clearly prohibits all
corruption and bribery. The requirements of the Code of
Conduct are extended to Sanoma’s suppliers through
the Supplier Code of Conduct. Sanoma aims to ensure
compliance with measures such as a mandatory e-learning
course on the Code of Conduct for all employees; however,
there can be no assurance that Sanoma’s internal control
measures will detect and prevent misbehaviour by
individual employees or third-party suppliers. Breaches
of applicable laws and regulations or corporate policies
by Sanoma’s employees or business partners may lead to
legal processes, sanctions and fines, as well as reputational
damage affecting Sanoma’s operations, which could have
a material adverse effect on Sanoma’s business, financial
condition or results of operations.
SANOMA ANNUAL REPORT 2022
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27
Financial risks
Funding and liquidity risks
Under all circumstances, the Group seeks to maintain
adequate liquidity, which depends on a number of factors.
The Group’s liquidity risk relates to servicing debt, financing
investments and retaining adequate working capital.
Sanoma aims to minimise its liquidity risks by ensuring
sufficient revenues, maintaining adequate committed
credit limits, using several financing institutions and forms
of financing, and spreading loan repayment programmes
over a number of calendar years. The Group’s treasury
policy sets minimum requirements for liquidity reserves.
There can be no assurance that the Group will be able to
maintain a sufficient level of liquidity or that the Group will
be able to obtain, on a timely basis or at all, sufficient funds
on acceptable terms to provide adequate liquidity in the
event that cash flows from operations, unused committed
credit line and cash reserves prove to be insufficient.
Negative changes in the economic environment could
affect the Group’ profitability and cash flow in a manner that
could adversely impact the Group’s ability to comply with
financial covenants in loan agreements. Failure to comply
with the financial covenants could lead to mandatory
prepayment of loans. Failure to generate additional funds,
whether from operations or additional debt or equity
financings, may, for example, require the Group to delay
or abandon some or all of its strategy initiatives, including
its strategic aim of acquisition-based growth, which could
have a material adverse effect on the Group’s business,
financial condition or results of operations. In addition, any
future adverse developments, such as a deterioration in the
financial markets and a worsening of general economic
conditions, may adversely affect Sanoma’s ability to borrow
additional funds as well as the cost and other terms of
the funding. For example, global financial markets have
experienced, and may continue to experience, significant
volatility and liquidity disruptions, for example, due to
high inflation, the impacts of the war in Ukraine or other
geopolitical unrest, which may adversely affect Sanoma’s
funding costs and access to funding and ultimately affect
Sanoma’s ability to finance its operations.
Interest rate risks
The Group’s interest rate risk is mainly related to changes
in the reference rates and loan margins of floating rate
loans in the Group’s loan portfolio. The Group manages its
exposure to interest rate risk by ensuring that the interest
duration of the gross debt of the Group is within a certain
time range approved by the Board of Directors as part of
the Group’s Treasury Policy. The Group may also manage its
exposure to interest rate risk by using a mix of fixed rate and
floating rate loans or by utilising interest rate derivatives.
As a result of the floating rate loans, a significant rise
in interest rates would lead to an increase in financial
expenses limiting for example the Group’s ability to pay
dividends. A failure to manage interest rate risk may have
an adverse effect on the Group’s financial condition.
Currency risks
The majority of the Group’s cash flow from operations is
denominated in euros. However, the Group is exposed to
some transaction risk resulting from cash flows generated
from sales and expenses denominated in other currencies.
Group companies are responsible for monitoring and
hedging material transaction risks related to their business
operations in accordance with the Group’s Treasury
Policy. The majority of the Group’s transaction risk in 2022
was related to the procurement of IT services and TV
programming rights, both denominated in U.S. dollars, the
strengthening of which could significantly increase the
Group’s operating costs. The Group has selectively entered
into forward contracts as a means of hedging against
significant transaction risks. Internal funding transactions
within the Group are mainly carried out in the functional
currency of the subsidiary. Group Treasury is responsible for
monitoring and hedging the currency risks related to intra-
group loans. Derivative instruments are used to hedge
future cash flows, hence changes in their value will offset
changes in the value of cash flows at the time they are paid
or received. The materialisation of any of these risks could
have a materially adverse effect on the Group’s earnings
and cash flow directly, and there can be no assurance that
the hedging of these risks is sufficient.
The Group is also exposed to translation risk resulting from
converting the income statement and balance sheet items
of foreign subsidiaries into euros. A significant change in
exchange rates may also have an effect on the value of the
businesses in Poland, Norway and Sweden. The Group did
not hedge against translation risk in 2022, in accordance
with the Group’s treasury policy approved by the Board of
Directors.
Credit risks
The Group’s credit risks are related to its business
operations, that is, the risk of the Group not being able
to collect the payments for its receivables. The possible
weakening of the economy, such as due to high inflation, the
impacts of the war in Ukraine or other geopolitical unrest,
may increase the Group’s credit risk, although potential
concentrations of credit risk are offset by the Group’s
diversified operations and the fact that no individual
customer or group of customers is material to the Group. In
Learning, credit risk of certain customers with a high-risk
profile is partially covered by credit insurance. The Group’s
SANOMA ANNUAL REPORT 2022
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operational units are responsible for managing credit risks
related to their businesses.
Agreements that Sanoma has entered into with financial
institutions contain an element of risk of the counterparties
being unable to meet their obligations, which could have
a material adverse effect on Sanoma’s business, financial
condition or results of operations. The Group’s Treasury
Policy specifies that financing, deposits and derivative
transactions are carried out with counterparties of good
credit standing and divided between a sufficient number
of counterparties in order to protect financial assets. The
Group has spread its credit risks efficiently by dealing with
several financing institutions. Sanoma’s ability to manage
its financial counterparty-related risks depends on a
number of factors, including market conditions affecting
its financial counterparties, and there can be no assurance
that Sanoma’s measures will be successful in preventing
the realisation of financial counterparty-related risks, which
could have a material adverse effect on Sanoma’s business,
financial condition or results of operations.
Risk of impairment of goodwill, immaterial rights
and other intangible assets
As of 31 December 2022, the Group’s consolidated
balance sheet included EUR 1,551 million (2021: 1,426)
in goodwill, immaterial rights and other intangible assets
compared to consolidated equity of EUR 702 million
(2021: 721), respectively. A majority of the balance of
goodwill, immaterial rights and other intangible assets are
related to Learning. In accordance with the International
Financial Reporting Standards (IFRS), instead of goodwill
being amortised regularly, it is tested for impairment
on an annual basis or more frequently if there is any
indication of impairment. The impairment losses on
goodwill, immaterial rights and other intangible assets
for continued and discontinued operations for the year
ended 31 December 2022 totalled EUR 8 million (2021: 5).
Changes in business fundamentals could lead to further
impairment, thus, impacting negatively Sanoma’s equity
and equity-related ratios. Further, as Sanoma’s strategic
aim is to grow through acquisitions, material amounts of
goodwill, immaterial rights and other intangible assets
might be recorded on Sanoma’s balance sheet and may be
impaired in the future in connection with the completions of
acquisitions.
The Group is exposed to seasonal fluctuation
The Group’s businesses are exposed to seasonal
fluctuation. For example, the Group’s learning business
has, by its nature, an annual cycle with strong seasonality.
Most net sales and earnings are accrued during the second
and third quarters, while the first and fourth quarters are
typically loss-making. The acquisitions of Pearson Italy
and Germany, as well as Santillana in Spain, have further
increased the importance of the third quarter, when the
new school year starts, for the business. In the media
business, net sales and earnings are particularly affected
by the development of advertising. Advertising sales are
influenced, for example, by the number of newspaper and
magazine issues published each quarter, which varies
annually. TV advertising in Finland is usually strongest
in the second and fourth quarters. The events business
in Finland is typically focused on the second and third
quarters.
Such seasonal fluctuations influence the Group’s net sales
and EBIT and, thus, could have a material adverse effect
on Sanoma’s business, financial condition or results of
operations and impact the comparability of the quarterly
financial information of the Group.
Risks related to changes to tax laws or their
application or as a result of a tax audit
Sanoma’s tax burden depends on tax laws and regulations
and their application and interpretation. Changes in tax
laws and regulations or their interpretation and application
may increase Sanoma’s tax costs to a significant degree,
which could have an adverse effect on Sanoma’s financial
condition and/or results of operations. In addition,
Sanoma may, at times, be subject to tax audits conducted
by national tax authorities. Tax audits or other auditing
measures carried out by tax or other authorities could
result in an imposition of additional taxes (such as income
taxes, value added taxes (VAT) and withholding taxes),
which could lead to an increase in Sanoma’s tax liability.
For example, the Finnish tax administration has performed
tax audits in Sanoma Media Finland Oy covering the years
2015–2021. In April 2021, the Finnish Tax Adjustment
Board accepted a claim based on tax audits at Sanoma
Media Finland in years 2015–2018 about the treatment
of VAT of certain magazines that were printed in multiple
locations in Europe and distributed through a centralised
logistics centre in Norway. Sanoma considers the claims
completely unjustified and has appealed from the
decisions. On 1 July 2021, Sanoma paid the required VAT,
the related penalty and interests of EUR 25 million in order
to avoid further interest accumulation. Sanoma considers
this payment to be a deposit with the tax authority while
the dispute is ongoing and consequently reports the
amount paid as a receivable. In August 2021, the tax
authorities made an ex officio decision on a corporate
income tax adjustment as a consequence of value-added
tax adjustment and refunded EUR 3 million of corporate
income tax to Sanoma. Sanoma considers this refund to
be a liability towards the tax authority while the dispute is
ongoing and consequently reports the amount received as
SANOMA ANNUAL REPORT 2022
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a liability. In December 2022, Sanoma received a payment
decision from the Finnish Tax Administration regarding
the tax audits at Sanoma Media Finland Oy for years
2019–2021, concerning the same business model and
a similar distribution arrangement as described above.
The decision is in line with the earlier decision concerning
years 2015–2018 by the Finnish Tax Adjustment Board.
Sanoma considers also the new claim fully unjustified and
has appealed from the decision. Based on the decision
received, Sanoma paid EUR 11 million of VAT, penalties
and interests in December 2022 in order to avoid further
interest accumulation. Sanoma considers this payment
to be a deposit with the tax authority while the dispute is
ongoing and consequently reports the amount paid as a
receivable. The VAT regulations have changed as of 1 July
2021 and thus further tax audits related to the matter
are not expected. The Administrative Court’s decision
regarding the years 2015–2018 is pending, as well as
Finnish tax adjustment board’s decision regarding the
years 2019–2021. In case the decision of the Administrative
Court is negative, the case will be appealed to the Supreme
Administrative Court. In case of a negative decision of the
Administrative Court, the net amount of 2015–2021 VAT
claims, approximately EUR 30 million, currently recognised
as receivable in the balance sheet, would be expensed as
items affecting comparability (IACs).
A more detailed description of the Group’s financial risks
and their management is available in Note 5.2.
Outlook for 2023
In 2023, Sanoma expects that the Group’s reported net
sales will be EUR 1.35–1.4 billion (2022: 1.3). The Group’s
operational EBIT excl. PPA is expected to be EUR 150–180
million (2022: 189).
Regarding the operating environment, Sanoma
expects that:
■
The economies in the Group’s operating countries,
particularly in Finland, will experience a mild recession.
■
The advertising market in Finland will decline slightly,
with most of the decline during the first half of the year.
Corporate Governance
Separate Corporate Governance Statement 2022 and
Remuneration Report 2022 can be found here.
Decisions of the Annual
General Meeting 2022
Sanoma Corporation’s Annual General Meeting (AGM) was
held on 7 April 2022 in Helsinki. The AGM was held based
on the so-called temporary act so that the shareholders of
the Company and their proxy representatives participated
in the meeting and exercised the shareholder’s rights
only by voting in advance as well as by submitting
counterproposals and asking questions in advance.
The meeting adopted the Financial Statements, the
Board of Directors’ Report and the Auditor’s Report
for the year 2021 as well as discharged the members
of the Board of Directors and the President and CEO
from liability for the financial year 2021. In addition, the
meeting made an advisory decision on the adoption of the
Remuneration Policy and the Remuneration Report of the
governing bodies.
The AGM resolved that a dividend of EUR 0.54 per share
shall be paid. The dividend was paid in two instalments.
The first instalment of EUR 0.27 per share was paid to
a shareholder who was registered in the shareholders’
register of the Company maintained by Euroclear Finland
Ltd on the dividend record date 11 April 2022. The payment
date for this instalment was 20 April 2022.
The second instalment of EUR 0.27 per share was paid to
a shareholder who was registered in the shareholders’
register of the Company maintained by Euroclear Finland
Ltd on the dividend record date 28 October 2022. The
payment date for this instalment was 4 November 2022.
The AGM resolved that the number of the members of
the Board of Directors shall be set at nine. Pekka Ala-
Pietilä, Julian Drinkall, Rolf Grisebach, Anna Herlin, Mika
Ihamuotila, Nils Ittonen, Denise Koopmans, Sebastian
Langenskiöld and Rafaela Seppälä were re-elected as
members. Pekka Ala-Pietilä was elected as the Chair of
the Board and Nils Ittonen as the Vice Chair. The term of all
Board members ends at the end of the AGM 2023.
The AGM resolved that the monthly remuneration payable
to the members of the Board of Directors shall remain
unchanged. The meeting fees of the Board of Directors were
resolved to be increased as follows:
■
For members of the Board of Directors who reside
outside Finland: the meeting fee remains EUR 1,000 /
Board meeting where the member was present;
■
For members of the Board of Directors who reside in
Finland: no separate fee is paid for attending Board
meetings;
SANOMA ANNUAL REPORT 2022
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30
■
For the Chairs of Board Committees: the meeting
fee is increased to EUR 3,500 / Committee meeting
participated;
■
For members of Committees who reside outside Finland:
the meeting fees are increased to EUR 2,500 / Committee
meeting where the member was present and EUR 1,500
/ Committee meeting participated; and
■
For members of Committees who reside in Finland:
the meeting fee is increased to EUR 1,500 / Committee
meeting participated.
The AGM resolved that a Shareholders’ Nomination
Committee is established for the Company and its Charter
was adopted. The Committee is established until further
notice until otherwise decided by the General Meeting of
the shareholders and it consists of up to four members who
represent the Company’s four largest shareholders who, on
31 May preceding the next year’s Annual General Meeting,
hold the largest number of votes calculated of all shares
in the Company. The composition of the Shareholders’
Nomination Committee and a Chair elected by the
Committee from among its members were announced on
21 June 2022 (more information is available in chapter
Events after the reporting period). The term of all members
of the Committee expires annually upon the appointment
of the next Shareholders’ Nomination Committee (to be
appointed after the next Annual General Meeting following
the appointment).
The AGM appointed audit firm PricewaterhouseCoopers
Oy as the auditor of the Company, with Samuli Perälä,
Authorised Public Accountant, as the auditor with principal
responsibility. The Auditor shall be reimbursed against
invoice approved by the Company.
Board authorisations
The AGM authorised the Board of Directors to decide on the
repurchase of a maximum of 16,000,000 of the Company’s
own shares (approx. 9.8% of all shares of the Company) in
one or several instalments. The shares shall be repurchased
with funds from the Company’s unrestricted shareholders’
equity, and the repurchases shall reduce funds available
for distribution of profits. The authorisation will be valid
until 30 June 2023 and it terminates the corresponding
authorisation granted by the AGM 2021.
The AGM authorised the Board of Directors to decide
on issuance of new shares and the conveyance of the
Company’s own shares held by the Company (treasury
shares) and the issuance of option rights and other special
rights entitling to shares as specified in Chapter 10, Section
1 of the Finnish Companies Act. Option rights and other
special rights entitling to shares as specified in Chapter 10,
Section 1 of the Finnish Companies Act may not be granted
as part of the Company’s incentive programme. The Board
will be entitled to decide on the issuance of a maximum
of 16,000,000 new shares (approx. 9.8% of all shares
of the Company) as well as conveyance of a maximum
of 5,000,000 treasury shares held by the Company in
one or several instalments. The issuance of shares, the
conveyance of treasury shares and the granting of option
rights and other special rights entitling to shares may be
done in deviation from the shareholders’ pre-emptive right
(directed issue). The authorisation will be valid until 30 June
2023 and it will replace the corresponding authorisation
granted by the AGM 2021.
Changes in the management
On 21 December 2021, Alex Green was appointed Chief
Financial Officer of Sanoma as of 1 March 2022. Sanoma’s
former CFO & COO Markus Holm continued to work for
Sanoma until 1 July 2022 with a focus on the hand-over and
strategic development projects.
Executive Management Team
As of 31 December 2022, Sanoma’s Executive Management
Team consists of the following members: Susan Duinhoven,
President and CEO; Alex Green, CFO; Pia Kalsta, CEO of
Sanoma Media Finland and Rob Kolkman, CEO of Sanoma
Learning.
Related party transactions
Sanoma has a Related Party Policy, under which members
of the Board of Directors, the Executive Management Team
and the SBU management teams are under obligation to
submit certain related party transactions, as defined in the
Policy, for a prior approval. In addition, the Board Charter
includes instructions for Board members’ conduct in related
party transactions and other conflict of interest situations.
Sanoma reports related party transactions in accordance
with IFRS. More information on transactions with related
parties is available in Financial Statements 2022, Note 6.1.
SANOMA ANNUAL REPORT 2022
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31
Annual General Meeting 2023
Sanoma’s Annual General Meeting 2023 will be held on
Wednesday, 19 April 2023 at 14:00 EET at Sanomatalo
(Töölönlahdenkatu 2, 00100 Helsinki). The shareholders
of the Company and their proxy representatives can also
exercise the shareholder’s rights by voting in advance
as well as by submitting counterproposals and asking
questions in advance in accordance with the instructions
set out in the Notice to the Annual General Meeting of the
Company published on 10 February 2023.
More information is available on the Company’s website
sanoma.com/investors.
Dividend proposal
On 31 December 2022, Sanoma Corporation’s distributable
funds were EUR 456 million, of which profit for the year
made up EUR 123 million. Including the fund for invested
unrestricted equity of EUR 210 million, the distributable
funds amounted to EUR 665 million. The Board of Directors
proposes to the Annual General Meeting that:
■
A dividend of EUR 0.37 per share shall be paid for
the year 2022. The dividend shall be paid in three
instalments. The first instalment of EUR 0.13 per share
shall be paid to a shareholder who is registered in the
shareholders’ register of the company maintained
by Euroclear Finland Ltd on the dividend record date
21 April 2023. The payment date for this instalment is
28 April 2023. Record date for the second instalment
of EUR 0.13 per share will be decided by the Board of
Directors in September, and the payment date will be in
September 2023. Record date for the third instalment
of EUR 0.11 per share will be decided by the Board of
Directors in October, and the payment date will be in
November 2023.
■
The amount left in equity shall be EUR 605 million.
According to its dividend policy, Sanoma aims to pay an
increasing dividend, equal to 40–60% of the annual free
cash flow. When proposing a dividend to the AGM, the
Board of Directors looks at the general macro-economic
environment, Sanoma’s current and target capital
structure, Sanoma’s future business plans and investment
needs, as well as both previous year’s cash flows and
expected future cash flows affecting capital structure.
Shares and shareholders
Sanoma has one series of shares, with all shares producing
equal voting rights and other shareholder rights. The
shares have no redemption and consent clauses, nor any
other transfer restrictions. Sanoma share has no nominal
value or book value.
Share capital
At the end of December 2022, Sanoma’s registered share
capital was EUR 71 million (2021: 71), and the total number
of shares was 163,565,663 (2021: 163,565,663), including
387,895 (2021: 679,614) of its own shares. Own shares
represented 0.2% (2021: 0.4%) of all shares and votes. The
number of outstanding shares excluding Sanoma’s own
shares was 163,177,768 (2021: 162,886,049).
In March 2022, Sanoma delivered a total of 291,719
(2021: 210,363) of its own shares (without consideration
and after taxes) as part of its long-term share-based
incentive plans.
Share trading and performance
At the end of December 2022, Sanoma’s market
capitalisation was EUR 1,602 million (2021: 2,219) with
Sanoma’s share closing at EUR 9.82 (2021: 13.62). In
January–December 2022, the volume-weighted average
price of Sanoma’s share on Nasdaq Helsinki Ltd. was EUR
12.56 (2021: 14.54), with a low of EUR 9.48 (2021: 12.80)
and a high of EUR 14.78 (2021: 17.12).
In January–December 2022, the cumulative value of
Sanoma’s share turnover on Nasdaq Helsinki Ltd. was EUR
156 million (2021: 237). The trading volume of 12 million
shares (2021: 16) equalled an average daily turnover of
49,000 shares (2021: 65,000). The traded shares accounted
for some 8% (2021: 10%) of the average number of shares.
Sanoma’s share turnover, including alternative trading
venues, CBOE DXE, Turquoise and Frankfurt, was 15 million
shares (2021: 16). Nasdaq Helsinki represented 83%
(2021: 80%) of the share turnover. (Source: Euroland)
Ownership structure and shareholders
The Board of Directors is not aware of any effective
agreements related to holdings in Sanoma shares and the
exercise of voting rights.
Sanoma had 23,695 (2021: 23,308) registered
shareholders at the end of December 2022.
On 31 December 2022, the combined holdings in the
Company’s shares of the members of the Board of Directors,
the President and CEO, and the bodies they control (as
referred to in Chapter 2, Section 4 of the Finnish Securities
Market Act) accounted for 7.1% (2021: 7.1%) of all shares
and votes. More information on management shareholding
and remuneration is available in Note 6.3.
SANOMA ANNUAL REPORT 2022
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32
MAJOR SHAREHOLDERS 31 DECEMBER 2022
Shareholders Shares % of shares
1 Jane and Aatos Erkko Foundation 39,820,286 24.35
2 Herlin Antti 19,816,800 12.12
Holding Manutas Oy 19,785,000 12.10
Herlin Antti 31,800 0.02
3 Langenskiöld Robin 12,273,371 7.50
4 Seppälä Rafaela 10,273,370 6.28
5 Helsingin Sanomat Foundation 4,701,570 2.87
6 Ilmarinen Mutual Pension Insurance Company 4,250,800 2.60
7 Varma Mutual Pension Insurance Company 2,792,136 1.71
8 Elo Mutual Pension Insurance Company 1,996,000 1.22
9 Noyer Alex 1,903,965 1.16
10 Aubouin Lorna 1,852,470 1.13
11 The State Pension Fund 1,760,000 1.08
12 Foundation for Actors’ Old-Age Home 1,700,000 1.04
13 Evli Finnish Small Cap Fund 1,023,096 0.63
14 Stiftelsen för Åbo Akademi 1,000,000 0.61
15 OP-Finland Small Firms Fund 810,508 0.50
16 Samfundet Fokhälsan I Svenska Finland 764,389 0.47
17 Langenskiöld Christoffer 645,996 0.39
18 Langenskiöld Sebastian 645,963 0.39
19 Langenskiöld Pamela 645,963 0.39
20 Oy Etra Invest Ab 550,000 0.34
20 largest shareholders total 109,226,683 66.78
Nominee registered 20,449,371 12.50
Other shares 33,889,609 20.72
Total 163,565,663 100.00
SHAREHOLDERS BY NUMBER OF SHARES HELD 31 DECEMBER 2022
Number of shares
Number of
shareholders %
Number of
shares %
1–100 8,421 35.54 401,187 0.25
101–500 8,527 35.99 2,338,528 1.43
501–1,000 2,853 12.04 2,233,827 1.37
1,001–5,000 3,041 12.83 6,676,152 4.08
5,001–10,000 424 1.79 3,007,103 1.84
10,001–50,000 313 1.32 6,128,391 3.75
50,001– 100,000 50 0.21 3,492,557 2.14
100,001–500,000 41 0.17 8,574,295 5.24
500,001 + 25 0.11 130,634,174 79.87
Total 23,695 100.00 163,486,214 99.95
In the joint book-entry account 79,449 0.05
Number of shares issued 163,565,663 100.00
Holdings by sector
31 December 2022,
%
14.9%
32.2%
27.8%
6.9%
15.4%
Data Table
Legend
Value in %
Exact value
Private
companies
2.8%
2.8
Financial and
insurance
institutions
15.4%
15.4
Public sector
organisations
6.9%
6.9
Households
27.8%
27.8
Non-profit
organisations
32.2%
32.2
Foreigners
14.9%
14.9
Total
100
Private companies
Financial and insurance institutions
Public sector organisations
Households
Non-profit organisations
Foreigners
2.8%
1
Holdings by sector
31 December 2022,
%
14.9%
32.2%
27.8%
6.9%
15.4%
Data Table
Legend
Value in %
Exact value
Private
companies
2.8%
2.8
Financial and
insurance
institutions
15.4%
15.4
Public sector
organisations
6.9%
6.9
Households
27.8%
27.8
Non-profit
organisations
32.2%
32.2
Foreigners
14.9%
14.9
Total
100
Private companies
Financial and insurance institutions
Public sector organisations
Households
Non-profit organisations
Foreigners
2.8%
1
HOLDINGS BY SECTOR 31 DECEMBER 2022
SANOMA ANNUAL REPORT 2022
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33
Events after the reporting period
On 2 February 2023, the Shareholders’ Nomination
Committee proposed to the Annual General Meeting 2023
that Pekka Ala-Pietilä, Julian Drinkall, Rolf Grisebach, Anna
Herlin, Mika Ihamuotila, Nils Ittonen, Denise Koopmans and
Sebastian Langenskiöld be re-elected as members of the
Board of Directors. Rafaela Seppälä has informed that she
does not stand for re-election to the Board. Consequently,
the Nomination Committee proposes that Eugenie van
Wiechen be elected as a new member of the Board. In
addition, the Shareholders’ Nomination Committee has
proposed that Pekka Ala-Pietilä be elected as the Chair
and Nils Ittonen as the Vice Chair of the Board of Directors.
The proposed Board members have all given their consent
to being elected. The term of all the Board members
ends at the end of the Annual General Meeting 2024. The
Shareholders’ Nomination Committee also proposed that
the monthly remuneration payable as well as the meeting
fees of the members of the Board of Directors remain
unchanged.
Key impacts of the war in Ukraine
Sanoma remains shocked and appalled by the continuing
war and atrocities in Ukraine. So far, the war has had a
limited direct impact on Sanoma’s businesses. In February
2022, Sanoma discontinued sourcing of newsprint
paper from Russia and has managed to organise a
complementary supply mainly from Central Europe and
Finland. Sanoma has also discontinued co-operation with
a smaller Russian technology provider. Sanoma expects
that the changing economic environment will have some
impact on its operating costs and customer demand. This
is reflected in the Outlook for 2023. More information on
Sanoma’s short-term risks and uncertainties is available in
chapter Risks and risk management.
Alternative performance measures
and discontinued operations
Sanoma presents certain financial performance measures
on a non-IFRS basis as alternative performance measures
(APMs). Sanoma considers that these alternative
performance measures provide useful and relevant
supplemental information to the management and
investors on Sanoma’s financial performance, financial
position or cash flows. Certain APMs exclude certain
non-operational or non-cash valuation items affecting
comparability (IACs) and are provided to reflect the
underlying business performance and to enhance
comparability between reporting periods. The APMs
should not be considered as a substitute for performance
measures in accordance with IFRS.
Unless otherwise stated, all income statement-related
quarterly and FY figures presented in this report
cover continuing operations only. Figures related to
balance sheet and cash flow cover both continuing and
discontinued operations. Sanoma’s continuing operations
include Learning and Media Finland, which are also
Sanoma’s reporting segments. There are no discontinued
operations in the Group in 2022. In 2021, discontinued
operations included certain Learning operations that were
under strategic review.
Definitions of key IFRS indicators and APMs are available
after the Report of the Board of Directors. Reconciliations
are available in chapter Reconciliation of certain key
figures. More information on the discontinued operations
result and cash flow in 2021 is available in Note 3.2.
SANOMA ANNUAL REPORT 2022
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34
Key indicators and share indicators
Key indicators
EUR million 2022 2021 2020 2019 2018
Net sales
1
1,298.3 1,251.6 1,061.7 912.6 891.4
Operational EBITDA
1
355.4 361.0 309.9 276.8 244.7
% of net sales
1
27.4 28.8 29.2 30.3 27.4
Operational EBIT excl. PPA
1
189.3 197.2 156.5 137.6 122.8
% of net sales
1
14.6 15.8 14.7 15.1 13.8
Items affecting comparability in EBIT
1
-37.9 -15.8 135.9 -22.5 -9.6
Purchase price allocation adjustments and amortisations (PPAs)
1
39.3 39.0 22.3 10.5 6.5
EBIT
¹
112.0 142.4 270.1 104.5 106.7
% of net sales
1
8.6 11.4 25.4 11.5 12.0
Result before taxes
1
99.2 133.8 261.0 82.7 94.2
% of net sales
1
7.6 10.7 24.6 9.1 10.6
Result for the period from continuing operations
1
77.0 101.4 237.8 64.8 72.6
% of net sales
1
5.9 8.1 22.4 7.1 8.1
Result for the period
77.0 101.2 247.1 13.3 125.6
% of net sales
5.9 8.1 23.3 1.5 14.1
Balance sheet total 2,103.6 1,932.5 2,048.3 1,997.9 1,519.0
Capital expenditure 52.9 41.7 42.5 31.7 32.0
% of net sales 4.1 3.3 3.7 2.5 2.4
Free cash flow 111.7 139.7 94.8 131.3 108.9
Return on equity (ROE), % 11.2 14.7 40.7 2.2 22.1
Return on investment (ROI), % 7.7 10.2 24.0 5.4 18.1
Equity ratio, % 35.8 40.6 37.4 30.5 44.7
Net gearing, % 117.3 85.5 93.1 144.2 55.3
Interest-bearing liabilities 864.4 668.8 775.3 817.9 356.7
Non-interest-bearing liabilities 537.1 542.8 560.4 644.5 550.9
Net debt 823.4 616.4 660.7 794.7 337.8
Net debt / Adj. EBITDA 3.2 2.4 2.6 2.7 1.4
Average number of employees (FTE)
1
5,018 4,885 4,255 3,551 3,404
Number of employees at the end of the period (FTE)
1
5,079 4,822 4,806 3,937 3,410
¹ Figures contain only continuing operations.
SANOMA ANNUAL REPORT 2022
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35
Share indicators
EUR 2022 2021 2020 2019 2018
Earnings/share, continuing operations
1
0.47
0.62 1.46 0.39 0.44
Earnings/share 0.47
0.61 1.51 0.07 0.76
Earnings/share, diluted, continuing operations
1
0.47
0.61 1.45 0.39 0.43
Earnings/share, diluted 0.47
0.61 1.51 0.07 0.76
Operational earnings/share, continuing operations
1
0.65
0.69 0.58 0.50 0.49
Operational earnings/share 0.65
0.69 0.67 0.80 0.84
Free cash flow per share 0.68
0.86 0.58 0.81 0.67
Equity/share 4.26
4.38 4.23 3.25 3.73
Dividend/share
2
0.37
0.54 0.52 0.50 0.45
Dividend payout ratio, %
2
79.2
87.9 34.4 707.0 59.1
Operational dividend payout ratio, %
2
56.8
77.9 77.9 62.5 53.4
Market capitalisation, EUR million
3
1,602.4
2,218.5 2,240.1 1,539.7 1,379.7
Effective dividend yield, %
2
3.8
4.0 3.8 5.3 5.3
P/E ratio 21.0
22.2 9.1 133.6 11.1
Adjusted number of shares at the end of the period
3
163,177,768
162,886,049 163,036,686 163,016,523 162,504,370
Adjusted average number of shares
3
163,130,613
163,165,194 163,041,596 162,933,737 163,084,958
Lowest share price 9.48
12.80 6.84 7.96 8.01
Highest share price 14.78
17.12 14.00 10.44 11.47
Average share price 12.56
14.54 10.15 9.03 9.28
Share price at the end of the period 9.82
13.62 13.74 9.45 8.49
Trading volumes, shares 12,404,976
16,289,472 29,310,738 19,098,115 39,317,670
% of shares 7.6
10.0 18.0 11.7 24.1
1
Figures contain only continuing operations.
2
Year 2022 proposal of the Board of Directors.
3
The number of shares does not include treasury shares.
SANOMA ANNUAL REPORT 2022
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36
Definitions of key indicators
KPI Definition Reason to use
Comparable net sales (growth) = Net sales (growth) adjusted for the impact of acquisitions and divestments
Complements reported net sales by reflecting the underlying
business performance and enhancing comparability between
reporting periods
Items affecting comparability (IACs) =
Gains/losses on sale, restructuring incl. transaction and integration costs of acquisitions
or efficiency program expenses and impairments that exceed EUR 1 million.
Reflects the underlying business performance and enhances
comparability between reporting periods
Operational EBITDA = Operating profit + depreciation, amortisation and impairments - IACs
Measures the profitability before non-cash based depreciation and
amortisation, reflects the underlying business performance and
enhances comparability between reporting periods
Purchase price allocation
adjustments and amortisations
(PPAs)
=
Purchase price allocation amortisations and cost impact of the inventory fair
value adjustments
A component used in the calculation of KPI's
(incl Operational EBIT excl PPA)
Operational EBIT excl. PPA = EBIT– IACs – Purchase price allocation (PPA) adjustments and amortisations
Measures the profitability excl. acquisition-related PPA adjustments
and amortisations, reflects the underlying business performance
and enhances comparability between reporting periods
Equity ratio, % =
Equity total
x 100
One of Sanoma’s long-term financial targets, measures the relative
proportion of equity to total assets
Balance sheet total - advances received
Free cash flow = Cash flow from operations - capital expenditure Basis for Sanoma’s dividend policy
Free cash flow/share =
Free cash flow
Basis for Sanoma’s dividend policy
Weighted average number of shares on the market
Net debt =
Interest-bearing liabilities (short or long term liabilities which have separately
determined interest cost) - cash and cash equivalents
Measures Sanoma’s net debt position
Net debt/adj. EBITDA =
The adjusted EBITDA used in this ratio is the 12-month rolling operational EBITDA,
where acquired operations are included and divested operations excluded, and where
programming rights and prepublication rights have been raised above EBITDA on cash
flow basis
One of Sanoma’s long-term financial targets, provides investors
information on Sanoma’s ability to service its debt
Net financial items = Financial income - Financial expenses Measures Sanoma's net financial items
Earnings/share (EPS) =
Result for the period attributable to the equity holders of the Parent Company
Measures Sanoma’s result for the period per share
Weighted average number of shares on the market
SANOMA ANNUAL REPORT 2022
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37
KPI Definition Reason to use
Operational EPS =
Result for the period attributable to the equity holders of the Parent Company - IACs -
tax effect of IACs - non-controlling interests' share of IACs
In addition to EPS, reflects the underlying business performance
and enhances comparability between reporting periods
Weighted average number of shares on the market
Net gearing, % =
Interest-bearing liabilities (short or long term liabilities which have separately
determined interest cost) - cash and cash equivalents
x 100
Measures how much debt in relation to equity Sanoma is using to
finance its assets
Equity total
Return on equity (ROE), % =
Result for the period
x 100
Measures the company’s relative profitability, ie. the profit received
for the equity employed
Equity total (average of monthly balances)
Return on investment (ROI), % =
Result before taxes + interest and other financial expenses
x 100
Measures the company’s relative profitability, ie. the profit and
interest received for net assets employed
Balance sheet total - non-interest-bearing liabilities (average of monthly balances)
Non-interest-bearing liabilities =
Non-interest-bearing liabilities include trade and other payables, contract liabilities,
deferred and income tax liabilities, provisions and pension liabilities
Equity/share =
Equity attributable to the equity holders of the Parent Company
Adjusted number of shares on the market at the balance sheet date
Dividend payout ratio, % =
Dividend/share
x 100
Result/share
Operational dividend payout ratio, % =
Dividend/share
x 100
Operational EPS
Effective dividend yield, % =
Dividend/share
x 100
Share price on the last trading day of the year
P/E ratio =
Share price on the last trading day of the year
x 100
Result/share
Market capitalisation =
Number of shares on the market at the balance sheet date x
share price on the last trading day of the year
Definitions of key indicators
SANOMA ANNUAL REPORT 2022
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38
Reconciliation of certain key figures
Reconciliation of operational EBIT excl. PPA
EUR million 2022 2021
EBIT 112.0 142.4
Items affecting comparability (IACs) and PPA adjustments and
amortisations¹
Learning
Impairments -11.6 -3.1
Capital gains/losses 0.5
Restructuring expenses -21.1 -8.0
PPA adjustments and amortisations -32.5 -32.2
Media Finland
Impairments -0.6
Capital gains/losses 0.4
Restructuring expenses -5.0 -5.5
PPA adjustments and amortisations -6.9 -6.8
Other operations
Impairments -0.6
Capital gains/losses 3.7
Restructuring expenses -1.1 -1.7
Items affecting comparability (IACs) and PPA adjustments and
amortisations total -77.2 -54.9
Operational EBIT excl PPA, continuing operations 189.3 197.2
Depreciations of buildings and structures -26.6 -24.9
Depreciation of rental books -11.5 -16.0
Amortisation of film and TV broadcasting rights -54.2 -54.0
Amortisation of prepublication rights -31.6 -25.5
Other depreciations, amortisations and impairments -53.2 -47.3
Items affecting comparability in depreciation, amortisation and
impairments 11.1 3.8
Operational EBITDA 355.4 361.0
EUR million 2022 2021
Items affecting comparability (IACs) and PPA adjustments and
amortisations in discontinued operations
Restructuring expenses -0.6
Total -0.6
1
Items affecting comparability and PPA adjustments and amortisations are unaudited.
SANOMA ANNUAL REPORT 2022
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39
Reconciliation of operational EPS
EUR million 2022 2021
Result for the period attributable to the equity holders of
the Parent Company 76.2 100.2
Items affecting comparability 37.9 16.4
Tax effect of items affecting comparability -7.8 -3.6
Operational result for the period attributable to the
equity holders of the Parent Company 106.3 113.0
Weighted average number of shares on the market 163,130,613 163,165,194
Operational EPS 0.65 0.69
Reconciliation of net debt
EUR million 31 Dec 2022 31 Dec 2021
Non-current financial liabilities 599.4 432.2
Current financial liabilities 100.1 75.0
Non-current lease liabilities 119.6 133.5
Current lease liabilities 45.3 28.1
Cash and cash equivalents -41.0 -52.4
Net debt 823.4 616.4
Reconciliation of adjusted EBITDA
EUR million 2022 2021
12-month rolling operational EBITDA 355.4 360.5
Impact of acquired and divested operations 17.2 0.0
Impact of programming rights -54.3 -57.1
Impact of prepublication rights -55.4 -41.6
Impact of rental books -7.5 -6.3
Adjusted EBITDA 255.4 255.4
Reconciliation of comparable net sales growth
EUR million 2022 2021
Group
Net sales 1.298.3 1.251.6
Impact of acquired and divested operations -39.8 -4.4
Comparable net sales 1.258.5 1.247.3
Learning
Net sales 681.0 637.3
Impact of acquired and divested operations -37.8 -2.4
Comparable net sales 643.2 634.9
Media Finland
Net sales 618.1 615.3
Impact of acquired and divested operations -2.0 -2.0
Comparable net sales 616.1 613.3
Reconciliation of return on equity (ROE), %
EUR million 2022 2021
Result for the period 77.0 101.2
Equity total (average of monthly balances) 688.0 690.0
Return on equity. % 11.2 14.7
Reconciliation of return on investment (ROI), %
EUR million 2022 2021
Result before taxes 99.2 132.7
Interest and other financial items 18.0 15.3
Result before taxes excl. interests and other financial items 117.2 148.0
Balance sheet total (average of monthly balances) 2,103.5 2,036.6
Non-interest-bearing liabilities (average of monthly balances) -582.4 -585.5
Balance sheet total - non-interest-bearing liabilities
(average of monthly balances) 1,521.1 1,451.2
Return on investment. % 7.7 10.2
SANOMA ANNUAL REPORT 2022
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40
Consolidated
Financial Statements
Consolidated income statement ...............................42
Statement of comprehensive income .....................43
Consolidated balance sheet ..........................................44
Changes in consolidated equity ..................................45
Consolidated cash flow statement ...........................46
Notes to the Consolidated Financial
Statements
................................................................................. 47
1. Accounting policies for Consolidated
Financial Statements
...........................................................48
2. Financial performance
........................................................58
3. Acquisitions and capital expenditure
.............................73
4. Working capital and other balance sheet items
........85
5. Capital structure and financial items
.............................93
6. Other notes
........................................................................... 103
SANOMA ANNUAL REPORT 2022
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41
Consolidated income statement
EUR million Note 2022 2021
NET SALES
2.1, 2.2
Other operating income
2.3
Materials and services
2.5
-458.0 -417.2
Employee benefit expenses
2.4, 6.2, 6.3
-356.2 -350.9
Other operating expenses
2.5
-177.2 -158.8
Share of results in joint ventures
4.7
Depreciation, amortisation and impairment losses
2.6, 3.3, 3.4, 4.6
-216.5 -206.6
EBIT 112.0 142.4
Share of results in associated companies
4.7
-0.4 0.4
Financial income
2.7
Financial expenses
2.7
-22.0 -17.2
RESULT BEFORE TAXES 99.2 133.8
Income taxes
2.8
-22.2 -32.4
RESULT FOR THE PERIOD FROM CONTINUING OPERATIONS 77.0 101.4
DISCONTINUED OPERATIONS
Result for the period from discontinued operations
3.2
-0.2
RESULT FOR THE PERIOD 77.0 101.2
EUR million Note 2022 2021
Result from continuing operations attributable to:
Equity holders of the Parent Company 76.2 100.5
Non-controlling interests 0.7 0.9
Result from discontinued operations attributable to:
Equity holders of the Parent Company -0.2
Non-controlling interests
Result attributable to:
Equity holders of the Parent Company 76.2 100.2
Non-controlling interests 0.7 0.9
Earnings per share for result attributable to the
equity holders of the Parent Company:
2.9
Earnings per share, EUR, continuing operations 0.47 0.62
Diluted earnings per share, EUR, continuing operations 0.47 0.61
Earnings per share, EUR, discontinued operations 0.00
Diluted earnings per share, EUR, discontinued
operations
Earnings per share, EUR 0.47 0.61
Diluted earnings per share, EUR 0.47 0.61
In 2021, discontinued operations included certain Learning operations that were under strategic review.
SANOMA ANNUAL REPORT 2022
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42
Statement of comprehensive income
1
EUR million 2022 2021
Result for the period 77.0 101.2
Other comprehensive income:
Items that may be reclassified subsequently to profit or loss
Change in translation differences 2.3 -0.6
Items that will not be reclassified to profit or loss
Defined benefit plans -6.9 18.1
Income tax related to defined benefit plans 1.3 -3.7
Other comprehensive income for the period, net of tax -3.3 13.8
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD 73.6 114.9
Total comprehensive income attributable to:
Equity holders of the Parent Company 72.9 114.0
Non-controlling interests 0.7 0.9
1
Statement of comprehensive income includes both continuing and discontinued operations.
SANOMA ANNUAL REPORT 2022
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43
Consolidated balance sheet
Assets
EUR million Note 31 Dec 2022 31 Dec 2021
ASSETS
NON-CURRENT ASSETS
Property, plant and equipment
2.3, 2.5, 3.4
Right-of-use assets
3.4
Investment property
2.3, 2.5, 4.6
Goodwill
3.3
Other intangible assets
3.3
Equity-accounted investees
4.7
Other investments
4.8
Deferred tax receivables
2.8
Non-current receivables
4.2, 4.9
NON-CURRENT ASSETS, TOTAL 1,801.3 1,691.6
CURRENT ASSETS
Inventories
4.1
Income tax receivables 10.4 16.6
Contract assets
2.2
Trade and other receivables
4.3
Cash and cash equivalents
5.3
CURRENT ASSETS, TOTAL 302.3 240.8
ASSETS, TOTAL 2,103.6 1,932.5
Equity and liabilities
EUR million Note 31 Dec 2022 31 Dec 2021
EQUITY AND LIABILITIES
EQUITY
5.4, 6.2
Share capital 71.3 71.3
Treasury shares -5.2 -7.5
Fund for invested unrestricted equity 209.8 209.8
Translation differences -17.3 -19.6
Retained earnings 436.5 459.7
Total equity attributable to the equity holders of the
Parent Company
Non-controlling interests 7.0 7.2
EQUITY, TOTAL 702.1 720.9
NON-CURRENT LIABILITIES
Deferred tax liabilities
2.8
Pension obligations
4.9
Provisions
4.4
Financial liabilities
5.1
Lease liabilities
5.1
Contract liabilities
2.2
Trade and other payables
4.5
NON-CURRENT LIABILITIES, TOTAL 850.0 706.2
CURRENT LIABILITIES
Provisions
4.4
Financial liabilities
5.1
Lease liabilities
5.1
Income tax liabilities 12.9 25.3
Contract liabilities
2.2
Trade and other payables
4.5
CURRENT LIABILITIES, TOTAL 551.5 505.4
LIABILITIES, TOTAL 1,401.5 1,211.6
EQUITY AND LIABILITIES, TOTAL 2,103.6 1,932.5
SANOMA ANNUAL REPORT 2022
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44
Changes in consolidated equity
Equity attributable to the equity holders of the Parent Company
EUR million Note Share capital
Treasury
shares
Fund for
invested
unrestricted
equity
Translation
differences
Retained
earnings Total
Non-
controlling
interests Total
Equity at 1 Jan 2021
5.4
Result for the period 100.2 100.2 0.9 101.2
Other comprehensive income -0.6 14.4 13.8 13.8
Total comprehensive income -0.6 114.6 114.0 0.9 114.9
Purchase of treasury shares -5.0 -5.0 -5.0
Share-based compensation
6.2
Shares delivered
6.2
Dividends paid -84.8 -84.8 -0.6 -85.5
Total transactions with owners of the company -3.2 -86.3 -89.5 -0.6 -90.1
Acquisitions and other changes in non-controlling interest -0.4 -0.4 -12.8 -13.1
Total change in ownership interest -0.4 -0.4 -12.8 -13.1
Equity at 31 Dec 2021 71.3 -7.5 209.8 -19.6 459.7 713.6 7.2 720.9
Equity at 1 Jan 2022
5.4
Result for the period 76.2 76.2 0.7 77.0
Other comprehensive income 2.3 -5.6 -3.3 -3.3
Total comprehensive income 2.3 70.6 72.9 0.7 73.6
Share-based compensation
6.2
-0.4 -0.4 -0.4
Shares delivered
6.2
Dividends paid -88.1 -88.1 -1.0 -89.1
Reclassification of translation differences -3.2 -3.2 -3.2
Total transactions with owners of the company 2.3 -94.0 -91.7 -1.0 -92.6
Acquisitions and other changes in non-controlling interest 0.2 0.2 0.0 0.2
Total change in ownership interest 0.2 0.2 0.0 0.2
Equity at 31 Dec 2022 71.3 -5.2 209.8 -17.3 436.5 695.1 7.0 702.1
SANOMA ANNUAL REPORT 2022
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45
Consolidated cash flow statement
EUR million Note 2022 2021
OPERATIONS
Result for the period 77.0 101.2
Adjustments
Income taxes
2.8
Financial expenses
2.7
Financial income
2.7
-9.5 -8.3
Share of results in equity-accounted investees
4.7
-0.2 -0.9
Depreciation, amortisation and impairment losses 216.5 206.6
Gains/losses on sales of non-current assets -3.3 -4.3
Other adjustments 2.1 -0.2
Adjustments total 249.9 241.7
Change in working capital
Change in trade and other receivables 46.5 -15.0
Change in inventories -6.4 9.9
Change in trade and other payables, and provisions -35.7 -5.6
Acquisitions of broadcasting rights, prepublication costs and
rental books
-111.2 -105.1
Dividends received 0.6 0.6
Interest paid -11.9 -10.2
Other financial items -1.3 -3.4
Taxes paid -42.8 -32.7
CASH FLOW FROM OPERATIONS 164.6 181.4
INVESTMENTS
Capital expenditure -52.9 -41.7
Operations acquired
3.1
-204.9 -5.7
Joint ventures and associated companies acquired
4.7
-0.7
Proceeds from sale of tangible and intangible assets 1.4 8.8
EUR million Note 2022 2021
Operations sold
3.1
Sales of other investments 0.0 0.6
Loans granted -3.2 -0.6
Repayments of loan receivables 0.4 0.0
Interest received 0.8 0.1
CASH FLOW FROM INVESTMENTS -250.7 -39.1
CASH FLOW BEFORE FINANCING -86.2 142.3
FINANCING
Purchase of treasury shares -5.0
Change in loans with short maturity
5.1
Drawings of other loans
5.1
Repayments of other loans
5.1
-124.7 -250.2
Payment of lease liabilities
5.1
-30.5 -30.4
Acquisitions of non-controlling interests
3.1
-1.0 -15.2
Dividends paid -89.1 -87.9
CASH FLOW FROM FINANCING 74.6 -204.7
Change in cash and cash equivalents according to cash flow
statement
-11.6 -62.3
Effect of exchange rate differences on cash and cash
equivalents 0.2 0.1
Net increase(+)/decrease(-) in cash and cash equivalents -11.4 -62.2
Cash and cash equivalents at 1 Jan 52.4 114.6
Cash and cash equivalents at 31 Dec
5.3
Includes continuing and discontinued operations.
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1. Accounting policies for
Consolidated Financial Statements
..............48
2. Financial performance .............................................58
3. Acquisitions and capital expenditure ..........73
4. Working capital and other
balance sheet items
...................................................85
5. Capital structure and financial items ...........93
6. Other notes .....................................................................103
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1.1 Corporate information
segments which are its two strategic business units Sanoma Learning and Sanoma Media
Finland. This is aligned with the way Sanoma manages the businesses. Sanoma Learning is
one of the global leaders In K12 education serving over 25 million students in 12 countries.
Its learning products and services enable teachers to develop the talents of every child to
reach their potential. Sanoma Learning offers printed and digital learning materials as well
as digital learning and teaching platforms for K12, i.e. primary, secondary and vocational
education, and it aims to grow the business. Sanoma Learning develops its methodologies
based on deep teacher and student insight and truly understanding their individual needs.
By combining educational technologies and pedagogical expertise, Sanoma Learning
creates learning products and services with the highest learning impact. Sanoma Media
Finland is the leading cross-media company in Finland, reaching 97% of all Finns weekly.
It provides information, experiences, inspiration and entertainment through multiple
media platforms: newspapers, TV, radio, events, magazines, online and mobile channels.
Sanoma Media Finland has leading brands and services, like Helsingin Sanomat, Ilta-
Sanomat, Aamulehti, Me Naiset, Aku Ankka, Nelonen, Ruutu, Supla and Radio Suomipop. For
advertisers, it is a trusted partner with insight, impact and reach.
is listed on the Nasdaq Helsinki. The Parent Company is domiciled in Helsinki , Finland and
its registered office is T öölönlahdenkatu 2, 00100 Helsinki , Finland .
On 9 February 2023, Sanoma’s Board of Directors approved these financial statements to
be disclosed.
Copies of the consolidated financial statements are available at sanoma.com or from the
Parent Company’s head office.
1.2 Basis of preparation of financial statements
1.3 Accounting policies
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51
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52
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53
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54
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55
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1.4 Adoption of new and amended standards and interpretations
The Group has applied the same accounting policies as in the Financial Statements 2021,
except for the effect of changes required by the adoption of the following new standards,
interpretations and amendments to standards and interpretations as of 1 January 2022:
■
Amendments to IAS 16 Property, Plant and Equipment: Proceeds before Intended Use.
Amendments prohibit a company from deducting from the cost of property, plant
and equipment amounts received from selling items produced while the company is
preparing the asset for its intended use. Instead, a company will recognise such sales
proceeds and related cost in profit or loss. The amendments do not have material effect
on the Group’s financial statements.
IASB and IFRIC have issued certain new standards and interpretations, which are not yet
effective, and the Group has not applied these requirements before the effective date. These
standards and amendments are not expected to have material Impact on the Group’s
financial statements.
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2. Financial performance
2.1 Operating segments ........................................................59
2.2 Net sales .................................................................................63
2.3 Other operating income .................................................66
2.4 Employee benefit expenses .........................................67
2.5 Materials and services and other operating
expenses .................................................................................67
2.6 Depreciation, amortisation and
impairment losses .............................................................68
2.7 Financial items .................................................................... 69
2.8 Income taxes and deferred taxes ..............................69
2.9 Earnings per share ............................................................72
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Net sales
1,298m€
EPS
0.47€
EBIT
112m€
2.1 Operating segments
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60
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61
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62
2.2 Net sales
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63
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64
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65
2.3 Other operating income
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66
2.5 Materials and services and other operating expenses
2.4 Employee benefit expenses
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67
2.6 Depreciation, amortisation and impairment losses
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68
2.7 Financial items
2.8 Income taxes and deferred taxes
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69
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70
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71
2.9 Earnings per share
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72
3. Acquisitions and
capital expenditure
3.1 Acquisitions and divestments .....................................74
3.2 Assets held for sale and discontinued
operations ..............................................................................77
3.3 Intangible assets ................................................................78
3.4 Property, plant and equipment and
right-of-use assets ............................................................82
In 2022, Sanoma acquired Pearson’s local K12
learning content business in Italy and its small exam
preparation business in Germany.
M&A strategy
■ In short-term, we focus on in-market acquisitions
in K12 learning business
■ In long-term, we continue to be open to all value
creating M&A opportunities
CAPEX
Sanoma’s capital expenditure (cash based) mainly
consisted of growth investments in digital platforms
and ICT in Learning as well as maintenance
investments. In 2022, CAPEX amounted to 53 m€.
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3.1 Acquisitions and divestments
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74
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75
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76
3.2 Assets held for sale and discontinued operations
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77
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78
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79
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80
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81
3.4 Property, plant and equipment and right-of-use assets
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82
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83
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84
4. Working capital and other
balance sheet items
4.1 Inventories ............................................................................. 86
4.2 Other receivables, non-current .................................. 86
4.3 Trade and other receivables, current ......................86
4.4 Provisions ...............................................................................87
4.5 Trade and other payables .............................................87
4.6 Investment property .........................................................88
4.7 Equity-accounted investees .........................................88
4.8 Other investments ............................................................. 89
4.9 Post-employment benefits ...........................................89
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4.1 Inventories
4.2 Other receivables, non-current
4.3 Trade and other receivables, current
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86
4.4 Provisions
4.5 Trade and other payables
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87
4.6 Investment property
4.7 Equity-accounted investees
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88
4.8 Other investments
4.9 Post-employment benefits
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89
SANOMA ANNUAL REPORT 2022
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90
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91
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92
5. Capital structure and
financial items
5.1 Financial liabilities and lease liabilities .................94
5.2 Financial risk management .........................................96
5.3 Cash and cash equivalents ....................................... 100
5.4 Equity .....................................................................................101
5.5 Contingent liabilities ..................................................... 102
LONG-TERM FINANCIAL TARGETS
Target 31 Dec 2022
Net debt / adj.EBITDA <3.0 3.2
Equity ratio 35–45% 35.8%
Dividend Increasing dividend, 40–60%
of free cash flow
93%
1
Net debt to adjusted EBITDA ratio was 3.2 (2021: 2.4)
being slightly above the long-term target of below
3.0. Net debt and leverage ratio increased as a result
of the acquisition of Pearson Italy and Germany.
823m€
Net debt
1
Of the underlying free cash flow
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93
5.1 Financial liabilities and lease liabilities
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94
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95
5.2 Financial risk management
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96
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97
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98
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99
5.3 Cash and cash equivalents
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100
5.4 Equity
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101
5.5 Contingent liabilities
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102
6. Other notes
6.1 Related party transactions ........................................ 104
6.2 Share-based payments ..............................................104
6.3 Management compensation, benefits and
ownership ........................................................................... 109
6.4 Subsidiaries, associated companies and
joint ventures .....................................................................112
6.5 Events after the balance sheet date ..................... 113
More information about the
management compensation
available in the Remuneration
Report 2022
LEARN MORE ►
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6.1 Related party transactions
6.2 Share-based payments
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104
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105
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106
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107
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108
6.3 Management compensation, benefits and ownership
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109
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110
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111
6.4 Subsidiaries, associated companies and joint ventures
SANOMA ANNUAL REPORT 2022
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112
6.5 Events after the balance sheet date
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113
Parent Company
Financial Statements
Parent Company income statement, FAS ........115
Parent Company balance sheet, FAS .................. 115
Parent Company cash flow statement, FAS .... 116
Notes to the Parent Company
Financial Statements
........................................................117
1. Parent Company’s accounting policies for
Financial Statements
.....................................................117
2. Net sales
............................................................................117
3. Other operating income
............................................... 117
4. Personnel expenses
.......................................................118
5. Other operating expenses
...........................................118
6. Financial income and expenses
................................ 118
7. Income taxes
....................................................................118
8. Intangible assets
............................................................119
9. Tangible assets
...............................................................120
10. Investments
......................................................................121
11. Receivables
.......................................................................122
12. Shareholders' equity
......................................................122
13. Appropriations
................................................................123
14. Non-current liabilities
...................................................123
15. Current liabilities
.............................................................123
16. Contingent liabilities
......................................................124
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Parent Company income statement, FAS
EUR million Note 2022 2021
Net sales
2
57.8 79.7
Other operating income
3
4.1 5.6
Personnel expenses
4
-18.4 -26.3
Depreciation, amortisation and impairment losses
8–10
-0.6 -3.0
Other operating expenses
5
-54.1 -67.7
OPERATING PROFIT (LOSS) -11.2 -11.7
Financial income and expenses
6
93.7 165.0
RESULT BEFORE APPROPRIATIONS AND TAXES 82.5 153.3
Appropriations
13
48.1 46.0
Income taxes
7
-7.6 -8.3
RESULT FOR THE YEAR 123.0 191.0
Parent Company balance sheet, FAS
Assets
EUR million Note 31.12.2022 31.12.2021
NON-CURRENT ASSETS
Intangible assets
8
4.2 6.7
Tangible assets
9
7.1 7.4
Investments
10
1,513.4 1,324.6
Long-term receivables
11
2.4
NON-CURRENT ASSETS, TOTAL 1,527.1 1 ,338.7
CURRENT ASSETS
Short-term receivables
11
125.1 90.8
Cash and cash equivalents 19.2 32.7
CURRENT ASSETS, TOTAL 144.2 123.4
ASSETS, TOTAL 1,671.3 1,462.2
Equity and liabilities
EUR million Note 2022 2021
SHAREHOLDERS' EQUITY
12
Share capital 71.3 71.3
Treasury shares -5.2 -7.5
Fund for invested unrestricted equity 209.8 209.8
Retained earnings 337.8 233.9
Profit for the year 123.0 191.0
SHAREHOLDERS' EQUITY, TOTAL 736.7 698.4
APPROPRIATIONS
13
0.5 0.8
LIABILITIES
Non-current liabilities
14
599.2 424.5
Current liabilities
15
334.9 338.5
LIABILITIES, TOTAL 934.1 763.0
EQUITY AND LIABILITIES, TOTAL 1,671.3 1,462.2
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Parent Company cash flow statement, FAS
EUR million 2022 2021
OPERATIONS
Result for the period 123.0 191.0
Adjustments
Income taxes 7.6 8.3
Appropriations -48.1 -46.0
Financial income and expenses -93.7 -165.0
Depreciation, amortisation and impairment losses 0.6 3.0
Gains / losses on sale of non-current assets -1.9 -3.1
Other adjustments 3.3 2.9
Change in working capital
Change in trade and other receivables 4.7 7.4
Change in trade and other payables, and provisions -4.3 -1.8
Dividends received and refunds of capital 63.0 159.2
Interest paid -8.0 -4.8
Other financial items -0.7 -2.5
Taxes paid -8.2 -10.6
EUR million 2022 2021
CASH FLOW FROM OPERATIONS 37.3 138.0
INVESTMENTS
Acquisition of tangible and intangible assets -3.6 -3.0
Investments in group companies -200.0
Sales of tangible and intangible assets 0.1 6.6
Group companies sold 1.8
Repayments of capital 10.9 20.8
Loans granted -219.5 -5.8
Repayments of loan receivables 12.5 231.2
Interest received 10.6 13.5
CASH FLOW FROM INVESTMENTS -187.2 63.3
CASH FLOW BEFORE FINANCING -149.8 201.2
FINANCING
Purchase of treasury shares -5.0
Change in loans with short maturity 69.7 -21.0
Drawings of other loans 344.5 263.7
Repayments of other loans -235.7 -465.0
Dividends paid -88.1 -84.8
Group contributions 46.0 47.7
CASH FLOW FROM FINANCING 136.4 -264.4
Change in cash and cash equivalents according to cash flow
statement -13.5 -63.2
Net increase(+)/decrease(-) in cash and cash equivalents -13.5 -63.2
Cash and cash equivalents at 1 Jan 32.7 95.9
Cash and cash equivalents at 31 Dec 19.2 32.7
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Notes to the Parent Company Financial Statements
1. Parent Company’s accounting policies for Financial Statements
Sanoma Corporation is a public limited-liability company, which is domiciled in Helsinki.
Sanoma Corporation was founded on 1 May 1999 as the result of a combination merger.
Sanoma Corporation’s financial statements have been prepared according to Finnish
Accounting Standards (FAS). Sanoma Corporation is the Parent Company of Sanoma Group.
Sanoma has prepared its consolidated financial statements in accordance with most recent
International Financial Reporting Standards (IFRS). The Finnish accounting practices applied
by Sanoma Corporation and accounting principles of IFRS standards are mainly consistent thus
the main accounting principles are available in accounting policies of consolidated financial
statements.
The most significant differences between the accounting policies of Parent company and
Sanoma Group are the following.
Pensions
Statutory pension cover of Sanoma Corporation’s employees is managed by pension insurance
companies. Supplementary pension benefits are managed by Sanoma Pension Fund and by
insurance companies. Pension settlements and pension costs are recognised during the period
in which they are incurred. The potential deficit of pension fund’s pension liability has been
recognised as an obligatory provision under the balance sheet of Sanoma Corporation.
Interest in Group companies
Interest in Group companies is measured at cost less any impairment losses. Interest in Group
companies is tested for impairment annually. Impairment testing also includes net receivables
from subsidiaries.
The fair value of the subsidiary shares has been assessed based on income approach, in which
the fair value of investment is calculated based on the discounted cash flow model (DCF) or
the dividend discount model. Impairment need is assessed by comparing the fair value of the
subsidiary shares to the book value in the parent company’s balance sheet and possible write-
down is booked through profit or loss.
Real estate investments and housing property investments
In accordance with Finnish Accounting Act investments in real estates and housing property are
presented as investments of non-current assets.
Change in accounting policy
The presentation of net sales and other operating income has been changed in the income
statement of Sanoma Oyj and the comparable figures have been adjusted accordingly.
Management and other service fees charged from subsidiaries are presented as Sanoma Oyj's
net sales.
2. Net sales
EUR million 2022 2021
Net sales by business
Management and service fees 57.8 79.7
Total 57.8 79.7
Net sales by market areas
Finland 28.9 54.6
Other EU-countries 25.6 21.6
Other countries 3.3 3.5
Total 57.8 79.7
3. Other operating income
EUR million 2022 2021
Rental income 0.1 0.1
Capital gains 1.9 3.2
Other 2.1 2.3
Total 4.1 5.6
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4. Personnel expenses
EUR million 2022 2021
Wages, salaries and fees -16.2 -22.8
Pension costs -1.9 -2.9
Other social expenses -0.3 -0.6
Total -18.4 -26.3
Average number of employees (full-time equivalents) 129 198
The remuneration to the President and CEO and Board of Directors is presented separately,
divided by persons, in Note 6.3 to the Financial Statements.
5. Other operating expenses
EUR million 2022 2021
Office and ICT expenses -38.1 -51.1
Professional fees -9.4 -10.7
Rents -0.6 -0.8
Other -6.0 -5.1
Total -54.1 -67.7
PRINCIPAL AUDIT FEES
EUR million 2022 2021
Statutory audit -0.4 -0.4
Total -0.4 -0.4
6. Financial income and expenses
EUR million 2022 2021
Dividend income
From Group companies 91.0 159.2
Total 91.0 159.2
Interest income from investments under non-current assets
From Group companies 12.8 13.2
Total 12.8 13.2
Other interest and financial income
From Group companies 0.6 0.3
From other companies 2.0 0.0
Exchange rate gains 3.3 2.1
Total 5.9 2.4
Interest and other financial expenses
To Group companies -1.3 -0.1
To other companies -11.2 -7.6
Exchange rate losses -3.6 -2.2
Total -16.0 -9.8
Total 93.7 165.0
7. Income taxes
EUR million 2022 2021
Income tax on operational income -7.6 -8.3
Income taxes from previous periods 0.0 0.0
Total -7.6 -8.3
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8. Intangible assets
INTANGIBLE ASSETS 2022
EUR million
Immaterial
rights
Other
intangible assets
Advance
payments Total
Acquisition cost at 1 Jan 0.0 14.8 2.4 17.2
Increases 1.7 1.3 3.0
Decreases -7.5 -1.4 -8.9
Reclassifications 1.1 -1.3 -0.2
Acquisition cost at 31 Dec 0.0 10.2 1.0 11.2
Accumulated amortisation and impairment losses at 1 Jan 0.0 -10.5 -10.5
Decreases 3.9 3.9
Amortisation for the period -0.4 -0.4
Accumulated amortisation and impairment losses at 31 Dec 0.0 -7.0 -7.0
Book value at 31 Dec 2022 0.0 3.1 1.0 4.2
INTANGIBLE ASSETS 2021
EUR million
Immaterial
rights
Other
intangible assets
Advance
payments Total
Acquisition cost at 1 Jan 2.8 15.0 2.0 19.9
Increases 0.7 2.4 3.1
Decreases -2.8 -3.0 -5.8
Reclassifications 2.0 -2.0
Acquisition cost at 31 Dec 14.8 2.4 17.2
Accumulated amortisation and impairment losses at 1 Jan -2.8 -11.0 -13.8
Decreases 2.8 3.0 5.8
Amortisation for the period 0.0 -2.5 -2.5
Accumulated amortisation and impairment losses at 31 Dec 0.0 -10.5 -10.5
Book value at 31 Dec 2021 0.0 4.3 2.4 6.7
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9. Tangible assets
TANGIBLE ASSETS 2022
EUR million Land and water
Buildings and
structures
Machinery and
equipment Other
Advance
payments Total
Acquisition cost at 1 Jan 6.4 1.3 0.3 0.2 8.2
Increases 0.2 0.2
Decreases -0.7 -0.7
Reclassifications -0.2 -0.2
Acquisition cost at 31 Dec 6.4 0.9 0.3 7.6
Accumulated depreciation and impairment losses at 1 Jan -0.8 -0.8
Decreases 0.6 0.6
Depreciation for the period -0.2 -0.2
Accumulated depreciation and impairment losses at 31 Dec -0.5 -0.5
Book value at 31 Dec 2022 6.4 0.4 0.3 7.1
TANGIBLE ASSETS 2021
EUR million Land and water
Buildings and
structures
Machinery and
equipment Other
Advance
payments Total
Acquisition cost at 1 Jan 9.7 0.3 3.2 0.3 0.4 13.8
Increases 0.2 0.2
Decreases -3.3 -0.3 -2.2 -5.8
Reclassifications 0.4 -0.4
Acquisition cost at 31 Dec 6.4 1.3 0.3 0.2 8.2
Accumulated depreciation and impairment losses at 1 Jan -0.1 -2.7 -2.8
Decreases 0.1 2.2 2.3
Depreciation for the period 0.0 -0.3 -0.3
Accumulated depreciation and impairment losses at 31 Dec 0.0 -0.8 -0.8
Book value at 31 Dec 2021 6.4 0.0 0.5 0.3 0.2 7.4
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10. Investments
INVESTMENTS 2022
EUR million
Interest in Group
companies
Receivables from
Group companies
Interest in associated
companies
Other shares
and holdings Total
Acquisition cost at 1 Jan 1,362.7 687.4 0.2 5.2 2,055.6
Increases 0.1 198.7 198.8
Decreases
1
-10.0 -10.0
Acquisition cost at 31 Dec 1,352.8 886.2 0.2 5.2 2,244.4
Accumulated impairment losses at 1 Jan -730.2 -0.8 -731.0
Accumulated impairment losses at 31 Dec -730.2 -0.8 -731.0
Book value at 31 Dec 2022 622.6 886.2 0.2 4.4 1,513.4
1
In 2022 decreases in interests in Group companies include capital refunds of EUR 10.0 million.
INVESTMENTS 2021
EUR million
Interest in Group
companies
Receivables from
Group companies
Interest in associated
companies
Other shares
and holdings Total
Acquisition cost at 1 Jan 1,183.5 922.4 0.2 5.3 2,111.5
Increases 200.0 200.0
Decreases
1
-20.8 -235.0 -0.2 -256.0
Acquisition cost at 31 Dec 1,362.7 687.4 0.2 5.2 2,055.6
Accumulated impairment losses at 1 Jan -730.2 -0.8 -731.0
Accumulated impairment losses at 31 Dec -730.2 -0.8 -731.0
Book value at 31 Dec 2021 632.6 687.4 0.2 4.4 1,324.6
1
In 2021 decreases in interests in Group companies include capital refunds of EUR 20.8 million.
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11. Receivables
LONG-TERM RECEIVABLES
EUR million 2022 2021
Accrued income
1
2.4
SHORT-TERM RECEIBABLES
EUR million 2022 2021
Trade receivables 1.2 6.5
Loan receivables 34.3 29.2
Accrued income
1
89.5 55.0
Total 125.1 90.8
Receivables from Group companies
Trade receivables 1.2 6.5
Loan receivables 34.3 29.2
Accrued income 82.8 49.9
Total 118.3 85.6
1
Most significant items under accrued items are the Group contributions and interest income accruals.
12. Shareholders' equity
EUR million 2022 2021
Restricted equity
Share capital at 1 Jan 71.3 71.3
Share capital at 31 Dec 71.3 71.3
Restricted equity 31 Dec 71.3 71.3
Unrestricted equity
Treasury shares at 1 Jan -7.5 -4.3
Purchase of treasury shares -5.0
Shares delivered 2.3 1.7
Treasury shares at 31 Dec -5.2 -7.5
Fund for invested unrestricted equity at 1 Jan 209.8 209.8
Fund for invested unrestricted equity at 31 Dec 209.8 209.8
Retained earnings at 1 Jan 424.9 317.7
Dividends paid -88.1 -84.8
Share-based compensation 1.6 1.7
Shares delivered -0.6 -0.6
Retained earnings at 31 Dec 337.8 233.9
Profit (loss) for the year 123.0 191.0
Unrestricted equity 31 Dec 665.4 627.2
Total 736.7 698.4
Further information on share capital is presented in Note 5.4 to the Financial Statements.
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DISTRIBUTABLE EARNINGS
EUR million 2022 2021
Treasury shares -5.2 -7.5
Fund for invested unrestricted equity 209.8 209.8
Retained earnings 337.8 233.9
Profit (loss) for the year 123.0 191.0
Total 665.4 627.2
13. Appropriations
EUR million 2022 2021
Group contributions 48.6 46.0
Cumulative depreciation differences -0.5 0.0
Total 48.1 46.0
14. Non-current liabilities
EUR million 2022 2021
Debentures 199.7 199.4
Loans from financial institutions 400.0 225.0
Accrued expenses -0.5 0.0
Total 599.2 424.5
15. Current liabilities
EUR million 2022 2021
Loans from financial institutions 25.0 75.0
Commercial papers 69.7
Trade payables 7.2 10.5
Accrued expenses
1
10.3 13.6
Other liabilities 222.7 239.3
Total 334.9 338.5
Liabilities to Group companies
Trade payables 0.6 1.2
Accrued expenses 0.7
Other liabilities
2
222.5 239.2
Total 223.1 241.0
1
Most significant items under accrued items are related to expense accruals and accrued personnel
expenses.
2
Other liabilities to group companies include balances in IHC account.
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16. Contingent liabilities
EUR million 2022 2021
Contingencies for own commitments
Other contingent liability for own commitments 15.0 15.0
Total 15.0 15.0
Contingencies incurred on behalf of Group companies
Guarantees 151.5 195.1
Total 151.5 195.1
Other liabilities
1
64.0 6.3
Total 64.0 6.3
Total 230.5 216.4
1
Other liabilities include commitments of contracts. In 2022 a new significant contract was signed with
an external operator.
NOMINAL VALUES OF DERIVATIVES
EUR million 2022 2021
Currency derivatives
Forward exchange contracts, external 15.0 7.8
Forward exchange contracts, internal 0.0 -0.1
Total 15.1 7.8
FAIR VALUES OF DERIVATIVES
EUR million 2022 2021
Currency derivatives
Forward exchange contracts, external -0.1 0.1
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Board’s proposal for
distribution of profits
Signatures
of the Board
Helsinki, 9 February 2023
Pekka Ala-Pietilä Nils Ittonen Julian Drinkall
Chair Vice Chair
Rolf Grisebach Anna Herlin Mika Ihamuotila
Denise Koopmans Sebastian Langenskiöld Rafaela Seppälä
Susan Duinhoven
President and CEO
Auditor's note
A report on the audit performed has been issued today.
Helsinki, 3 March 2023
PricewaterhouseCoopers Oy
Authorized Public Accountants
Samuli Perälä
APA
The retained earnings of the parent company Sanoma Corporation according to the
balance sheet as at 31 December 2022 were EUR 455,644,352.48 of which the profit for
the financial year 2022 was 123,017,461.10. Including the fund for invested unrestricted
equity of EUR 209,767,212.33 the distributable funds amounted to EUR 665,411,564.81 at
31 December 2022.
The Board of Directors will propose to the Annual General Meeting that
■
a dividend of EUR 0.37 per share shall be paid EUR 60,375,774.16
1
■
shareholders’ equity shall be set at EUR 605,035,790.65
No essential changes have taken place in the financial status of the Company after the
financial year. The Company’s liquidity is good and according to the Board of Directors
the proposed dividend will not compromise the Company’s liquidity.
1
The dividend will be paid in three instalments. The first instalment of EUR 0.13 per share shall be
paid to a shareholder who is registered in the shareholder register of the Company maintained by
Euroclear Finland Ltd on the dividend record date 21 April 2023. The payment date proposed by the
Board of Directors for this instalment is 28 April 2023.
The second instalment of EUR 0.13 per share shall be paid in September 2023. The second
instalment shall be paid to a shareholder who is registered in the shareholder register of the
Company maintained by Euroclear Finland Ltd on the dividend record date, which, together with
the dividend payment date, shall be decided by the Board of Directors in its meeting scheduled for 4
September 2023.
The third instalment of EUR 0.11 per share shall be paid in November 2023. The third instalment shall
be paid to a shareholder who is registered in the shareholder register of the Company maintained by
Euroclear Finland Ltd on the dividend record date, which, together with the dividend payment date,
shall be decided by the Board of Directors in its meeting scheduled for 25 October 2023.
Board’s proposal for
distribution of profits
Signatures
of the Board
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To the Annual General Meeting of Sanoma Corporation
Report on the Audit of the Financial Statements
Opinion
In our opinion
■
the consolidated financial statements give a true and fair view of the group’s financial
position and financial performance and cash flows in accordance with International
Financial Reporting Standards (IFRS) as adopted by the EU
■
the financial statements give a true and fair view of the parent company’s financial
performance and financial position in accordance with the laws and regulations
governing the preparation of the financial statements in Finland and comply with
statutory requirements.
Our opinion is consistent with the additional report to the Audit Committee.
What we have audited
We have audited the financial statements of Sanoma Corporation (business identity code
1524361-1) for the year ended 31 December 2022.The financial statements comprise:
■
the consolidated balance sheet, consolidated income statement, statement of
comprehensive income, changes in consolidated equity, consolidated cash flow
statement and notes, including a summary of significant accounting policies
■
the parent company’s balance sheet, income statement, cash flow statement and notes.
Basis for Opinion
We conducted our audit in accordance with good auditing practice in Finland. Our
responsibilities under good auditing practice are further described in the Auditor’s
Responsibilities for the Audit of the Financial Statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide
a basis for our opinion.
Independence
We are independent of the parent company and of the group companies in accordance with
the ethical requirements that are applicable in Finland and are relevant to our audit, and we
have fulfilled our other ethical responsibilities in accordance with these requirements.
To the best of our knowledge and belief, the non-audit services that we have provided to the
parent company and to the group companies are in accordance with the applicable law
and regulations in Finland and we have not provided non-audit services that are prohibited
under Article 5(1) of Regulation (EU) No 537/2014. The non-audit services that we have
provided are disclosed in note 2.5 to the Financial Statements.
Our Audit Approach
Overview
Materiality
Audit Scope
Key Audit
Matters
■
We have applied an overall group materiality of
9,000,000 euros.
■
The group audit scope encompassed the most
significant group companies and covers the vast
majority of group’s revenues, assets and liabilities.
■
Valuation of goodwill and other intangible assets
identified in business combinations
■
Valuation of prepublication rights included in intangible
assets
■
Revenue recognition
■
Valuation of interests in group companies and
receivables from group companies in the Parent
Company’s financial statements
Auditor’s Report
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Auditor’s Report (Translation of the Finnish Original)
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As part of designing our audit, we determined materiality and assessed the risks of material
misstatement in the financial statements. In particular, we considered where management
made subjective judgements; for example, in respect of significant accounting estimates
that involved making assumptions and considering future events that are inherently
uncertain.
Materiality
The scope of our audit was influenced by our application of materiality. An audit is designed
to obtain reasonable assurance whether the financial statements are free from material
misstatement. Misstatements may arise due to fraud or error. They are considered material
if individually or in aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of the financial statements.
Overall group materiality 9,000,000 euros
How we determined it We used a combination of total revenues and profit before
tax as benchmarks to determine overall group materiality.
Rationale for the materiality
benchmark applied
We determined that total revenue and profit before tax
as a combination provide a suitable representation of the
volume of Sanoma’s operations and profitability.
Based on our professional judgement, we determined certain quantitative thresholds for
materiality, including the overall group materiality for the consolidated financial statements
as set out in the table below. These, together with qualitative considerations, helped us to
determine the scope of our audit and the nature, timing and extent of our audit procedures
and to evaluate the effect of misstatements on the financial statements as a whole.
How we tailored our group audit scope
At the end of 2022 Sanoma Group includes two reportable segments: Sanoma Media
Finland and Sanoma Learning. Sanoma Learning’s main markets are Poland, the
Netherlands, Finland, Belgium, Sweden, Spain, and Italy. In 2022 Sanoma acquired
Pearson’s local K12 learning content business in Italy (‘Pearson Italy’) and its small exam
preparation business in Germany (‘Pearson Germany’). We have scoped our audit to obtain
sufficient audit coverage of Sanoma Group consolidated financial statements. . In addition,
we have performed specific audit procedures related to the balance sheet of the acquired
Pearson entities as it has been consolidated to Sanoma Group consolidated financial
statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the financial statements of the current period. These matters were
addressed in the context of our audit of the financial statements as a whole, and in forming
our opinion thereon, and we do not provide a separate opinion on these matters.
As in all of our audits, we also addressed the risk of management override of internal controls,
including among other matters consideration of whether there was evidence of bias that
represented a risk of material misstatement due to fraud.
Key audit matter in the audit of the group How our audit addressed the key audit matter
Valuation of goodwill and other intangible
assets identified in business combinations
Refer to Accounting policies for consolidated
financial statements and Note 3.3.
As of December 2022, Goodwill amounted to
EUR 812 million. Other intangible assets and
immaterial rights amounted to EUR 578 million
including other intangible assets identified in
business combinations.
With the acquisition of Pearson’s learning content
business (Italy and Germany) in 2022, goodwill
increased by EUR 55 million and other intangible
assets increased by EUR 86 million.
Goodwill is not amortized but tested at least once
a year for possible impairment. Other intangible
assets are amortized using the straight-line
method over their useful lives. For the purpose of
impairment testing, goodwill has been allocated
to two cash flow generating units (CGU):
• Sanoma Media Finland, goodwill of EUR 110
million
• Sanoma Learning, goodwill of EUR 702 million.
The goodwill impairment testing is carried out
by determining the present value of future cash
flows of the CGUs. This assessment involves
considerable management judgment with respect
to assumptions used in the cash flow projections
specifically relating to the long-term growth rate,
profitability level and discount rate.
The valuation of goodwill and other intangible
assets identified in business combinations
are considered a key audit matter due to
their financial significance as well as due to
the management judgement involved in the
valuation.
Our audit procedures included, for example, the
following:
• We obtained an understanding of the
methodology used in the goodwill impairment
testing
• We tested the mathematical accuracy of the
calculations
• We assessed the reasonableness of the
estimated future profitability levels and their
consistency with the approved budgets and
forecasts
• We tested the reasonableness of the discount
rates, the long-term growth rates, and other
assumptions by e.g., comparing the inputs to
observable market data
• We tested management’s sensitivity
analysis to ascertain the extent of change in
key assumptions that either individually or
collectively could result in an impairment of
goodwill
• We evaluated the management’s estimate of
the amortization period used for intangible
assets, including those identified in business
combinations.
• We assessed the adequacy of the disclosures.
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Key audit matter in the audit of the group How our audit addressed the key audit matter
Valuation prepublication rights included in
intangible assets
Refer to Accounting policies for consolidated
financial statements and Note 3.3.
As of December 31, 2022, prepublication rights
amount to EUR 128 million.
The prepublication rights of learning materials
and solutions are mostly internally generated
intangible assets that are amortized using the
straight-line method over their useful lives.
The group reviews the carrying values of these
intangible assets to determine that they do not
exceed the estimated future economic benefits.
Valuation of these intangible assets is considered
a key audit matter due to management
judgement involved in determining the
amortization period and in assessing the
recoverability of these assets.
Our audit procedures included, for example, the
following:
• We obtained an understanding of the
accounting and valuation principles of the
prepublication rights
• We evaluated the management’s estimate
of the amortization period used for the
prepublication rights
• We evaluated management’s estimate of the
future economic benefits of these assets
• We tested, on a sample basis, additions to the
prepublication rights.
Revenue recognition
Refer to Note 2.2. in the consolidated financial
statements
The group’s total net sales from continued
operations amount to EUR 1 298 million.
Revenue from the Learning segment is primarily
generated through sale of educational books and
granting access to online learning platforms as
well as physical distribution of learning materials.
The Media Finland segment principally generates
revenue through magazine and newspaper
publishing (circulation sales and advertising
sales), TV and Radio operations, online and
subscription video on demand services as well
as events. Revenue recognition principles vary
depending on the nature of the revenue stream.
Revenue recognition is considered a key audit
matter due to the significance of revenue to the
financial statements and due to management
judgement involved in selecting the appropriate
revenue recognition method for the different
revenue streams.
Our audit procedures included, for example, the
following:
• We obtained an understanding of the
company’s revenue recognition policies and
compared these to the respective standards on
revenue recognition
• We tested the internal controls that the
company uses to assess the completeness,
accuracy and timing of revenue recognized
• We tested revenue contracts and transactions
on a sample basis
• We tested, on a sample basis, revenue related
balances in the balance sheet, such as
provision for returns and advances received.
Key audit matter in the audit of the group How our audit addressed the key audit matter
Valuation of interests in group companies
and receivables from group companies in the
Parent Company’s financial statements
Refer to the Parent Company’s accounting
policies and Note 9
The investments in group companies’ shares
amounts to EUR 623 million. The Parent
Company’s investments also include EUR 886
million of loan receivables from group companies.
Interest in group companies is tested for
impairment annually using the income approach.
In applying this approach, the fair value of an
investment is calculated based on the discounted
cash flow model or the discounted dividend
model.
Valuation of interests in group companies and
receivables from group companies is considered
a key audit matter in the audit of the Parent
Company due to the significance of these
investments to the financial statements and
due to management judgement involved in the
income approach used to test the valuation of
these investments.
Our audit procedures included, for example, the
following:
• We assessed the reasonableness of
management assumptions relating to the
estimated future results by e.g., checking their
consistency with the approved budgets and
forecasts
• We assessed the inputs and methodology
in determining the discount rates, and in
evaluating the long-term growth rates by e.g.,
comparing the inputs to observable market
data
• We reviewed the Parent Company’s disclosures
in respect of the impairment testing.
There are no significant risks of material misstatement referred to in Article 10(2c) of Regulation (EU)
No 537/2014 with respect to the consolidated financial statements or the parent company financial
statements.
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Responsibilities of the Board of Directors and the President and CEO for the
Financial Statements
The Board of Directors and the President and CEO are responsible for the preparation
of consolidated financial statements that give a true and fair view in accordance with
International Financial Reporting Standards (IFRS) as adopted by the EU, and of financial
statements that give a true and fair view in accordance with the laws and regulations
governing the preparation of financial statements in Finland and comply with statutory
requirements. The Board of Directors and the President and CEO are also responsible for
such internal control as they determine is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of Directors and the President and CEO
are responsible for assessing the parent company’s and the group’s ability to continue as
a going concern, disclosing, as applicable, matters relating to going concern and using the
going concern basis of accounting. The financial statements are prepared using the going
concern basis of accounting unless there is an intention to liquidate the parent company or
the group or to cease operations, or there is no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements
as a whole are free from material misstatement, whether due to fraud or error, and to
issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of
assurance, but is not a guarantee that an audit conducted in accordance with good auditing
practice will always detect a material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with good auditing practice, we exercise professional
judgment and maintain professional scepticism throughout the audit. We also:
■
Identify and assess the risks of material misstatement of the financial statements,
whether due to fraud or error, design and perform audit procedures responsive to
those risks, and obtain audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal control.
■
Obtain an understanding of internal control relevant to the audit in order to design
audit procedures that are appropriate in the circumstances, but not for the purpose
of expressing an opinion on the effectiveness of the parent company’s or the group’s
internal control.
■
Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.
■
Conclude on the appropriateness of the Board of Directors’ and the President and
CEO’s use of the going concern basis of accounting and based on the audit evidence
obtained, whether a material uncertainty exists related to events or conditions that may
cast significant doubt on the parent company’s or the group’s ability to continue as a
going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the financial statements or, if
such disclosures are inadequate, to modify our opinion. Our conclusions are based on the
audit evidence obtained up to the date of our auditor’s report. However, future events or
conditions may cause the parent company or the group to cease to continue as a going
concern.
■
Evaluate the overall presentation, structure and content of the financial statements,
including the disclosures, and whether the financial statements represent the underlying
transactions and events so that the financial statements give a true and fair view.
■
Obtain sufficient appropriate audit evidence regarding the financial information of the
entities or business activities within the group to express an opinion on the consolidated
financial statements. We are responsible for the direction, supervision and performance
of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters,
the planned scope and timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied
with relevant ethical requirements regarding independence, and to communicate with
them all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those
matters that were of most significance in the audit of the financial statements of the current
period and are therefore the key audit matters. We describe these matters in our auditor’s
report unless law or regulation precludes public disclosure about the matter or when, in
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extremely rare circumstances, we determine that a matter should not be communicated in
our report because the adverse consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.
Other Reporting Requirements
Appointment
We were first appointed as auditors by the annual general meeting on 21 March 2017.
Other Information
The Board of Directors and the President and CEO are responsible for the other information.
The other information comprises the report of the Board of Directors and the information
included in the Annual Review, but does not include the financial statements and our
auditor’s report thereon.
Our opinion on the financial statements does not cover the other information.
In connection with our audit of the financial statements, our responsibility is to read the
other information and, in doing so, consider whether the other information is materially
inconsistent with the financial statements or our knowledge obtained in the audit, or
otherwise appears to be materially misstated. With respect to the report of the Board of
Directors, our responsibility also includes considering whether the report of the Board of
Directors has been prepared in accordance with the applicable laws and regulations.
In our opinion
■
the information in the report of the Board of Directors is consistent with the information in
the financial statements
■
the report of the Board of Directors has been prepared in accordance with the applicable
laws and regulations.
If, based on the work we have performed, we conclude that there is a material misstatement
of the other information, we are required to report that fact. We have nothing to report in
this regard.
Other statements
We support the adoption of the financial statements. The proposal by the Board of Directors
regarding the treatment of distributable funds is in compliance with the Limited Liability
Companies Act. We support that the Board of Directors of the parent company and the
President and CEO be discharged from liability for the financial period audited by us.
Helsinki 3 March 2023
PricewaterhouseCoopers Oy
Authorised Public Accountants
Samuli Perälä
Authorised Public Accountant (KHT)
Independent Auditor’s Reasonable
Assurance Report on Sanoma Corporation’s
ESEF Financial Statements (Translation)
To the Management of Sanoma Oyj
We have been engaged by the Management of Sanoma Oyj (business identity code
1524361-1) (hereinafter also “the Company”) to perform a reasonable assurance
engagement on the Company’s consolidated IFRS financial statements for the financial year
1.1.-31.12.2022 in European Single Electronic Format (“ESEF financial statements”) version
743700XJC24THUPK0S03-2022-12-31-fi.zip.
Management’s Responsibility for the ESEF Financial Statements
The Management of Sanoma Oyj is responsible for preparing the ESEF financial statements
so that they comply with the requirements as specified in the Commission Delegated
Regulation (EU) 2019/815 of 17 December 2018 (“ESEF requirements”). This responsibility
includes the design, implementation and maintenance of internal control relevant to the
preparation of ESEF financial statements that are free from material noncompliance with
the ESEF requirements, whether due to fraud or error.
Our Independence and Quality Control
We have complied with the independence and other ethical requirements of the
International Code of Ethics for Professional Accountants (including International
Independence Standards) issued by the International Ethics Standards Board for
Accountants (IESBA Code), which is founded on fundamental principles of integrity,
objectivity, professional competence and due care, confidentiality and professional
behaviour.
Our firm applies International Standard on Quality Management 1, which requires the firm
to design, implement and operate a system of quality management including policies or
procedures regarding compliance with ethical requirements, professional standards and
applicable legal and regulatory requirements.
Independent Auditor’s Reasonable
Assurance Report on Sanoma
Corporation’s
ESEF Financial Statements
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Our Responsibility
Our responsibility is to express an opinion on the ESEF financial statements based on the
procedures we have performed and the evidence we have obtained.
We conducted our reasonable assurance engagement in accordance with the International
Standard on Assurance Engagements (ISAE) 3000 (Revised) Assurance Engagements
Other than Audits or Reviews of Historical Financial Information. That standard requires
that we plan and perform this engagement to obtain reasonable assurance about
whether the ESEF financial statements are free from material noncompliance with the ESEF
requirements.
A reasonable assurance engagement in accordance with ISAE 3000 (Revised) involves
performing procedures to obtain evidence about the ESEF financial statements compliance
with the ESEF requirements. The procedures selected depend on the auditor’s judgment,
including the assessment of the risks of material noncompliance of the ESEF financial
statements with the ESEF requirements, whether due to fraud or error. In making those risk
assessments, we considered internal control relevant to the Company’s preparation of the
ESEF financial statements.
We believe that the evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Opinion
In our opinion, Sanoma Oyj’s ESEF financial statements for the financial year ended
31.12.2022 comply, in all material respects, with the minimum requirements as set out in the
ESEF requirements.
Our reasonable assurance report has been prepared in accordance with the terms of our
engagement. We do not accept, or assume responsibility to anyone else, except for Sanoma
Oyj for our work, for this report, or for the opinion that we have formed.
Helsinki 3 March 2023
PricewaterhouseCoopers Oy
Authorised Public Accountants
Samuli Perälä
Authorised Public Accountant (KHT)
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Annual General Meeting 2023
The Annual General Meeting 2023 will be held on
Wednesday, 19 April 2023 at 14:00 EET. The registration
and advance voting will begin on 15 March 2023 at
10:00 EET.
More information can be found at sanoma.com/agm.
Dividend
The Board of Directors proposes to the Annual General
Meeting that a dividend of EUR 0.37 per share shall be paid
in three instalments.
First instalment of EUR 0.13 per share
■
Record date 21 April 2023
■
Payment date 28 April 2023
Second instalment of EUR 0.13 per share
■
The record date for the second instalment will be
decided by the Board of Directors in September, and the
payment date will be in September 2023.
Third instalment of EUR 0.11 per share
■
The record date for the third instalment will be decided
by the Board of Directors in October, and the payment
date will be in November 2023.
Financial reporting in 2023
Sanoma will publish the following financial reports
during 2023:
■
Interim Report 1 January–31 March 2023
Thursday, 4 May 2023
■
Half-Year Report 1 January–30 June 2023
Wednesday, 26 July 2023
■
Interim Report 1 January–30 September 2023
Thursday, 26 October 2023
The reports are published in Finnish and English and can be
downloaded at sanoma.com/en/investors.
Changes in contact information
Euroclear Finland Ltd maintains a list of the Company’s
shares and shareholders. Shareholders who wish to change
their personal or contact information are kindly asked to
directly contact their own securities account operator.
Sanoma’s Investor Relations
The main task of Sanoma Investor Relations is to ensure
that the capital markets have correct and sufficient
information in order to determine the value of Sanoma
share. Sanoma has a centralised Investor Relations function
that serves analysts and investors, and coordinates
investor meetings and activities.
Contact information
Kaisa Uurasmaa
Head of Investor Relations and Sustainability
Mobile: +358 40 560 5601
kaisa.uurasmaa@sanoma.com
Meeting requests and inquiries
ir@sanoma.com
sanoma.com/en/investors
Information for investors
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Information for investors
Sanoma is a sustainable investment
with a positive impact on society.
Learn more about reasons to invest
in Sanoma
LEARN MORE ►