In 1999, N.V. Holdingmaatschappij De Telegraaf made a net profit of NLG 142.8 million compared to NLG 145.2 million for 1998. This means that net earnings per share of NLG 0.50 par value declined marginally from NLG 2.77 for 1998 to NLG 2.72 for 1999.

Group turnover rose by 4.6%, from NLG 1.52 billion for 1998 to NLG 1.59 billion for 1999, mainly owing to organic growth. The cash flow increased from NLG 263.1 million for 1998 to NLG 266.2 million for 1999.

The result for the first six months of 1999 was slightly higher than that recorded for the corresponding period in 1998. However, due to the initial losses relating to the free ‘Sp!ts’ morning paper (introduced in mid-1999 for commuters travelling by public transport) and the formation of a provision for reorganisations at Limburgs Dagblad in the second half of 1999, the group was unable to equal the record profit level achieved in 1998.

The result of Uitgeversmaatschappij De Limburger B.V., the operation of which has been for De Telegraaf's own account and risk since 1 October 1999, has not been included in the 1999 profit pending the Netherlands Competition Authority's approval of this takeover. The interest charge on the purchase sum, relating to the fourth quarter of 1999, has been charged to the result.

The group proposes to distribute an unchanged dividend for 1999, namely NLG 0.98 per share, representing a pay-out of 36.0% of the net profit. The pay-out for 1998 amounted to 35.4%.

The profit expectation for 2000 is adversely affected by the following factors:

  • investments totalling NLG 30 million as already announced in January of this year in connection with the impetus to be given to the Internet activities;
  • the initial losses resulting from the launch of new magazines in the course of 2000, including that of the ‘Residence’ title in Sweden;
  • the initial loss sustained by the proposed TV magazine that will come out as a supplement to the Saturday issue of ‘De Telegraaf’ as soon the TV programme listings are made available;
  • the failure so far to realise synergy in Limburg pending the outcome of the Netherlands Competition Authority's (NMa) decision-making process in respect of the acquisition of Uitgeversmaatschappij De Limburger B.V.

In contrast, the advertising turnover recorded by ‘Sp!ts’ during the first periods of 2000 surpassed the group's expectations; if this trend persists, the initial loss for the whole of 2000 will be lower than the loss incurred for the second half-year of 1999. Furthermore, income from the 30% stake in SBS Broadcasting B.V. will increase, partly as a result of the initial loss of Net 5, which has been charged to the 1999 result.

As regards daily newspaper ‘De Telegraaf’, the advertising volume for the whole year 2000 may well equal the 1999 level, partly in view of the expectation of sustained economic growth and the stimulus provided by the Europen football championship.

Given the above-mentioned circumstances, the result for 2000 could be significantly lower, mainly as a result of investments in the Internet and in new activities that will lay a firm foundation for the group's continued stable growth.