N.V. Holdingmaatschappij De Telegraaf has achieved a net profit of € 6.7 million over the period from January 1st 2003 up to and including July 13th 2003 compared to a net profit of € 11.3 million over the similar period in 2002. Per share of € 0.25 nominal value the net profit decreased by 38.1% from
€ 0.21 to € 0.13.

The main cause of the decrease in profits was the decline in advertising turnover by about
€ 20 million (an average of 9.6%). A major part of the decline in advertising turnover could be compensated for by the decrease in newsprint consumption, the lower price of newsprint (effective from April) and the effects of the reorganisation, which was started halfway through 2002. In that context, the number of employees has by now been reduced from 4.680 fte as per July 14th 2002 to 4.468 fte as per July 13th 2003.
Opposite these decreases are the higher cost of wages as a result of the increases under the collective labour agreements, higher pension costs, as well as initial losses of up to more than € 3 million with regard to new activities. Among these:
  • The introduction as of last April of a regional section as a supplement to the daily newspa-per De Telegraaf in Twente.
  • The introduction of Almere Vandaag, a newspaper which is being distributed free of charge, four times a week, from door-to-door in Almere since last April.
  • The car guide AutoTelegraaf Magazine which was launched last April.
  • The realisation of a central customer contact center. 
As a result of this, the profits before amortisation of goodwill (EBITA) decreased by € 3.6 million from € 20.5 million over the first 28 weeks of 2002 to € 16.9 million over the similar period in 2003.
The result of participations decreased under the influence of, among other factors, a € 1.1 million lower dividend from Wegener N.V. and the share in the losses of the joint delivery project (€ 1.3 million). The share in Wegener  (certificates of ordinary shares) increased from 21.6% at the end of 2002 to 23.9% as from July 13 2003. In 2003 1.001.285 certificates of ordinary shares were additionally bought against an average price of € 4.15. As from July 13 2003 this represents a bookvalue of € 60,821,800 or € 5.74 per share. The market value from that date amounted to € 6.20. This added value has not been taken into account in the results and the shareholders equity.    
As far as advertising volume for the daily newspaper De Telegraaf and the regional daily newspapers was concerned, a strong decline in the segment of personnel advertisements occurred (an average of about 45%) and an average decline of about 20% in the segment of classified advertisements. National brands and services however, showed growth: from more than 8% for the regional daily newspapers of Media Groep Limburg B.V., to 12% for dagblad De Telegraaf and about 19% for the regional dailies of the Hollandse Dagbladcombinatie B.V. Dagblad De Telegraaf was able to increase its share in the national daily newspaper advertising market from an average of 29% to 32%.
The decrease in paid circulation by an average of 2% for both the national and the regional daily newspapers was compensated for by increases in tariffs. Circulation income rose by an average of 1.8%.
The free morning paper Sp!ts was able to realise an advertising volume that was about 9% up.
In the free door-to-door newspaper sector, the decline in advertising volume by 5.7% could be partly compensated for by an increased income from special publications. Here too, the negative developments in the personnel advertising market were the cause of a substantial part of the decline.
Cost reduction programmes, among which the aforementioned reduction in employees, the integration of on-line and print activities, closure of the printing works in Maastricht and the combination of the activities of both the Limburg daily newspapers at one location, resulted in a substantial compensation for the decline in advertising turnover.
The magazine sector saw a decrease in advertising turnover by an average of 10%, while circula-tion income rose by an average of 3%. The portfolio of TTG Sweden was recently extended by two new titles involving homes and living. This September, the title CosmoGirl! will be introduced in The Netherlands in co-operation with Hearst.
The continuation of the decrease in the price of newsprint at the start of the second quarter of 2003 and the effects of the (further) economy measures will, without a doubt, have a positive effect on the profits for the final six months of 2003. However, developments in the advertising market will clearly be significant for profits for the whole of 2003. Personnel and classified advertisements will, in all expectations, not show a recovery. Apart from this, it is still uncertain whether the positive developments in the sector of national brands and services will continue. New activities, among which the joint venture with Endemol also have an important influence on profits.  Extraordinary costs to the extent of last year are not expected this year. On the basis of all this, no announcement will be made with regard to the expectations about the profits for the final six months of 2003.