Price sensitive

BoD approves results at 31 march 2022

In first quarter 2022, the Mondadori Group continued its efforts, on a like-for-like basis[1], to increase profitability; owing to the seasonal nature of the school publishing business, the positive contribution of  D Scuola will be felt more in the second half of the year.

  • Net revenue € 153.1 million: up by 5.7% versus 31.03.2021; net of the consolidation of D Scuola, the increase is +2.9%
  • Adjusted EBITDA € -1.1 million; net of the consolidation of D Scuola, the item closes at € +2.4 million, improving by € 1.3 million versus 31.03.2021
  • Group net result € -11.4 million; on a like-for-like basis, the result is € -7.1 million, recovering strongly versus 31.03.2021
  • Continued solid cash flow generation, net of the acquisition of D Scuola:
    – LTM cash flow from ordinary operations up slightly at € 68.9 million;
    – LTM free cash flow improves to reach € 57.5 million
  • NFP before IFRS 16 at € -135.8 million; excluding the effects of the acquisition of D Scuola, the NFP before IFRS 16 closes at € +9.6 million, improving sharply versus € -47.9 million at 31.03.2021

 

OUTLOOK: GUIDANCE FOR 2022 CONFIRMED

  • Mid-single-digit growth of revenue
  • Adjusted EBITDA up by more than 20%
  • Double-digit growth of net result
  • Cash flow from ordinary operations in line with 2021
  • Free cash flow in the region of € 40/45 million (before payout of the dividend) including the transactions already announced
  • NFP IFRS 16 less than 1.1x adjusted EBITDA.

START OF SHARE BUYBACK PROGRAM TO SERVICE THE SHARE PERFORMANCE PLANS

 

[1] Net of the consolidation of D Scuola, effective as from 1 January 2022.

Today, the meeting of the Board of Directors of Arnoldo Mondadori Editore S.p.A., chaired by Marina Berlusconi, reviewed and approved the Interim Management Statement at 31 March 2022 presented by CEO Antonio Porro.

I° QUARTER 2022 HIGHLIGHTS
In first quarter 2022, the Group – excluding the contribution from the newly-consolidated D Scuola – continued its efforts to increase profitability, spurred by the positive trend in revenue across all business areas and careful management of operations implemented in the prior quarters, which led to greater structural efficiency. The Mondadori Group concurrently confirmed its ability to guarantee steady and solid cash flow generation.

“The performance we recorded in the first quarter, and the process of continued strengthening implemented so far, allow us to confirm for 2022 the estimates previously announced, despite the uncertain economic and geopolitical context”, emphasized Antonio Porro, CEO of the Mondadori Group. “The solidity of our business model and our continued ability to generate cash flow put us in a position to continue to focus on and grow in our core business of books: a target that we have successfully pursued to date also through a series of major acquisitions”, concluded Porro.

PERFORMANCE AT 31 MARCH 2022
In the first quarter of the current year, the contribution of D Scuola, fully consolidated as from 1 January 2022, is irrelevant owing to the seasonal nature of the Education business which, in the first half of the year, records only the costs of creating editorial content as well as the expense from the promotional activities to support the adoption campaign, postponing the recognition of revenue from the sale of school textbooks to the second half of the year.

In first quarter 2022, consolidated revenue amounted to € 153.1 million, increasing by 5.7% versus      € 144.8 million in the prior year; net of the consolidation of D Scuola, Group revenue would have recorded a like-for-like growth of 2.9%, thanks to the contribution of all business areas, of the Retail area in particular.

Adjusted EBITDA for the period under review amounted to € -1.1 million. Excluding the result for the period of D Scuola, adjusted EBITDA came to a positive € 2.4 million, as the company, which operates in the school textbooks segment, recognizes a loss in the first part of the year due to the seasonal nature of the business: on a like-for-like basis, the Group recorded an improvement in profitability of € 1.3 million versus first quarter 2021, driven by the positive performance of the Books and Retail segments.

Group EBITDA came to € -0.7 million, or on a like-for-like basis to € +2.8 million: a comparison with the results of the prior year (€ 0.2 million) shows a clear improvement, thanks to the abovementioned business performance, and to the positive contribution from non-recurring items.

EBIT at 31 March 2022 stood at € -12.2 million (€ -6.6 million on a like-for-like basis). The comparison with 2021 shows:

  • an improvement of € 2.4 million on a like-for-like basis, due to the mentioned trends;
  • a deterioration of € 3.3 million in the overall scope, due to the consolidation of amortization and depreciation and the effects of the Purchase Price Allocation process from the acquisition of D Scuola.

The consolidated loss before tax amounted to € -14.4 million; on a like-for-like basis, the figure amounted to € -8.8 million, improving by 3 million versus € -12.1 million in the first three months of 2021.

Financial expense rose by € 0.3 million, due to the higher average gross debt recorded in the quarter following the acquisition of D Scuola.

The Group’s net result, after minority interests, amounted to € -11.4 million; on a like-for-like basis, the figure closes at € –7.1 million, a clear improvement versus € -10.2 million in the first three months of 2021. Mention should be made that in the first quarter of the year, the Group usually recognizes a net loss at a consolidated level, due to the seasonal nature of the Education business.

At 31 March 2022, the net financial position before IFRS 16 stood at € -135.8 million (€ -217.4 million including the IFRS 16 impact).

Excluding the effects of the acquisition of D Scuola, the net financial position before IFRS 16 stood at a positive € 9.6 million, improving significantly by over € 57.5 million versus the debt at 31 March 2021 (€ 47.9 million), attributable to the significant cash flow generation recorded in the last twelve months: including the impact of IFRS 16, the NFP stood at a negative € 69.9 million, due to the recognition of an additional financial payable of € 79.5 million.

The LTM cash flow from ordinary operations (after outlays for financial expense and tax), excluding D Scuola, amounted to € 68.9 million, allowing the Group to continue to strengthen its financial structure.

D Scuola, consolidated as from January 2022, reported a negative cash flow of € 13.3 million in the first quarter, in line with the seasonal nature of the school business which, in the first half of the year, records only the costs and expenditure for the development and publication of texts marketed in the second half.

The LTM Free Cash Flow at 31 March 2022 amounted to € 57.5 million, improving further versus the figure at 31 December 2021. Including the impact of the acquisition of D Scuola for approximately € 135 million, the Free Cash Flow of the overall scope recorded outlays of approximately € 88 million.

At 31 March 2022, Group employees amounted to 1,883 units, up by 2.4% versus 1,838 units at 31 March 2021 (+45 units), due primarily to the inclusion of D Scuola staff (totaling 127 units). On a like-for-like basis, therefore excluding both the contribution of the newly-consolidated company and the effects of the sale of the titles in the Media area in December 2021, the drop would come to approximately 2.3%, the result of the continued efforts to increase the efficiency of the individual business areas.

BUSINESS OUTLOOK
In light of the results achieved in the first few months and in the absence of any future material deterioration in the geopolitical context, for the full year 2022, the Group believes it can confirm the estimates previously disclosed, despite the critical issues arising from the increase in costs for the procurement of raw materials, primarily paper, and for energy consumption.

That said, the Group expects for:

  • Earnings: continued resilience of the business model
    – mid-single-digit growth of revenue;
    – Adjusted EBITDA up by more than 20%;
    – double-digit growth of the net result, thanks also to significantly lower non-recurring expense than the figure recorded in 2021, despite the fact that net profit in 2021 had benefited from a significant tax component[1] of approximately € 19 million.
  • Cash Flow and Net Financial Position: continued strong cash generation:
    – Cash Flow from ordinary operations: in line with 2021, as a result of the positive contribution from D Scuola, offsetting the “one-off” increase in Group capital expenditure, arising:
       – in the school segment, from the project to integrate D Scuola and from a stronger and richer product range and publishing catalogue in the school segment;
    – in the Retail area, from the plan on the relocation and renovation of the flagship store in Piazza Duomo in Milan, which will see conclusion in the final part of the year;
  • Free Cash Flow in the region of € 40/45 million (before payout of the dividend), which includes the expected cash outflows from extraordinary transactions announced;
  • Group net financial debt (IFRS 16) less than 1.1x Adjusted EBITDA (0.6x before IFRS 16).

The financial solidity reached allows the Group to continue its path of development, especially in the books business, also through M&As: therefore, the Group will continue to pursue its unwavering commitment, also in the current year, to further growth opportunities through acquisitions.

PERFORMANCE OF BUSINESS AREAS

  • BOOKS

In first quarter 2022, after the remarkable growth seen in 2021, the books market witnessed a consolidation phase marked by a slight decline in sales (-1.6% in terms of value and -0.6% in terms of volume)[2] versus the same period last year.
Even if we exclude from the measurements those segments currently untapped by the Mondadori Group, i.e. professional and, most importantly, comics, which are continuing to see strong growth close to 50% this year, the market continued to remain moderately weak, dropping (in terms of value) by 2.3% versus 2021.

Group revenue in the Trade segment, which fell slightly, was affected, on the one hand, by this trend of the relevant market and, on the other, by the scheduling of the publishing plan, which envisages the release of the major titles in the second half of the year, closing at € 52.3 million, down by approximately 6% versus € 55.9 million in first quarter 2021, which had benefited from the extraordinary success of “Il sistema. Potere, politica, affari: storia segreta della magistratura italiana” by A. Sallusti and L. Palamara (Rizzoli).

Nonetheless, the Group confirmed its undisputed leadership with a market share of 23% in the Trade segment (including the share of De Agostini Libri, consolidated as from 1 April 2022).

With regard to the school textbooks segment, mention should be made that this is a highly seasonal business, so revenue generated in the first three months typically accounts for less than 5% of the annual figure. In first quarter 2022, the activities recorded total revenue of € 9 million: on a like-for-like basis net of D Scuola, revenue was basically steady versus the prior year (€ 4.9 million in first quarter 2021).

Overall, revenue in the Books area as a whole in the first three months of 2022 amounted to € 76.2 million, up by 6.5% versus € 71.6 million in the first three months of 2021, due mainly to the consolidation of D Scuola. On a like-for-like basis excluding the contribution of the recently-acquired company, growth stood at 0.7%, thanks in particular to the strong increase achieved by the publishing house, Rizzoli International Publications, and the upswing in Electa’s museum activities.

Adjusted EBITDA amounted to € -2.1 million, including the negative contribution of D Scuola, owing to the seasonal nature of the school textbooks business: net of these effects, adjusted EBITDA would stand at € 1.5 million versus € 0.6 million in first quarter 2021, improving by 0.8 million, pushed by the positive performance of the publishing house Rizzoli International Publications and the upswing in Electa’s museum business.

  • RETAIL

As indicated earlier, in the first three months of the year, the books market recorded a slight drop versus first quarter 2021 (-1.6%[3]): this trend had no adverse effect on the performance of the physical channel which, due also to the pandemic-related restrictions that had restrained its activities in 2021, reported a growth versus the same period of the prior year.

Against this backdrop, the market share of Mondadori Retail reached 10.8%, driven by the remarkable performance of physical stores, which benefited from a positive comparison with the prior year.

In the first quarter, the Retail area posted revenue of € 37.2 million, up by € 3.8 million (approximately +11.5%) versus € 33.4 million in the same period of the prior year.

The ongoing development and renovation of existing stores and the focus on the core business of books have enabled the Mondadori Store network to further consolidate its role in the market, as shown by the strong improvement in Books revenue (€ +3.5 million), which is higher at the end of the first quarter even than in the pre-COVID period.

Specifically:

  • directly-managed stores reported a sharp increase in revenue (+49.9% versus the prior year), due to the abovementioned strategy of focusing on the book product and network development activities;
  • the franchised channel too, composed mainly of proximity stores located in small towns, continued its progression, increasing by +3.2% versus the same period of the prior year;
  • the online channel declined, reflecting the market trend.

The Retail area recorded a positive and sharply growing adjusted EBITDA of € +0.3 million (€ +0.7 million versus the first three months of 2021). This target was achieved thanks to the strong growth in revenue, the deep transformation of the business unit as a whole, the ongoing renewal and development of the network of physical stores, as well as careful cost management and a thorough review of the organization and processes.

  • MEDIA

In first quarter 2022, the Media area recorded revenue of € 47.1 million, basically steady versus € 46.8 million in the same quarter of the prior year, but up by 9.2% on a like-for-like basis of portfolio of brands (excluding the effect of the deconsolidation of the titles sold at end 2021).

Specifically:

  • digital activities, which now account for 20% of the area’s total revenue, increased significantly by over 31% versus first quarter 2021 (+36.8% on a like-for-like basis of brands), driven by the strong performance of AdKaora.
    Digital advertising revenue as a percentage of total advertising revenue now represents 77% (up from 66% in first quarter 2021);
  • traditional print activities, excluding the magazines sold at end 2021, improved by 3.4%, thanks to the positive circulation performance of television titles, which bucked the market trend.

 Adjusted EBITDA in the Media area stood at € 2 million, steady versus the first three months of 2021 as a result of:

  • in the print area, the continuing measures to contain operating costs, which offset the increase in industrial costs;
  • in the digital area, growth in activities in the MarTech segment, despite the higher editorial and development costs incurred for the launch of the new social magazine “The Wom”.


START OF SHARE BUYBACK PROGRAM TO SERVICE THE 2022-2024, 2021-2023 AND 2020-2022 SHARE PERFORMANCE PLANS
The Board of Directors of Arnoldo Mondadori Editore S.p.A. approved the start of a share buyback program, under Article 5 of Regulation (EU) no. 596/2014, to be executed in accordance with the terms and conditions, already disclosed to the public, resolved by the Ordinary Shareholders’ Meeting of 28 April 2022 which, among other things, authorized:

  • the purchase and disposal of treasury shares for a maximum amount of up to 0.265% of the share capital, which is intended to provide the Company with the no. 693,878 shares required over the three-year period to meet the obligations under the 2022-2024 Performance Share Plan established by the same Shareholders’ Meeting, pursuant to Article 114-bis of the TUF;
  • the continuation of the buyback program to service the 2020-2022 Performance Share Plan and the 2021-2023 Performance Share Plan in the manners and within the limits set out in the relevant Regulations.

Pursuant to Delegated Regulation (EU) 2016/1052, details of the buyback program are shown below:

Purpose of the plan
The sole purpose of the program is the buyback of Arnoldo Mondadori Editore S.p.A. treasury shares to service the 2022-2023 Performance Share Plan, the 2021-2023 Performance Share Plan and the 2020-2022 Performance Share Plan.

Maximum amount in cash allocated to the program
Buybacks will be made at a minimum unit price not lower than the official Stock Exchange price on the day before the purchase transaction, reduced by 20%, and at a maximum unit price not higher than the official Stock Exchange price on the day before the purchase transaction, increased by 10%. The volumes and unit purchase prices will, however, be defined in accordance with the conditions governed by Article 3 of EU Delegated Regulation 2016/1052. Specifically, no shares may be purchased at a price higher than the higher between the price of the last independent trade and the price of the highest current independent bid on the trading venue where the purchase is carried out. In terms of volumes, daily purchase amounts will not exceed 25% of the daily average volume of Mondadori shares traded over the 20 trading days before the dates of purchase.

Maximum number of shares to purchase
Purchases will regard a maximum of no. 410,000 ordinary shares (equal to 0.156%) of the share capital, taking account of the treasury shares already held in the Company’s portfolio, to service the 2022-2024 Performance Share Plan, the 2021-2023 Performance Share Plan and the 2020-2022 Performance Share Plan, in the manners and within the limits set out in the relevant Regulations.
The maximum total amount of shares under the program is therefore within the limits of 10% of the share capital indicated by the Shareholders’ Meeting of 28 April 2022, taking account also of the no. 1,049,838 treasury shares, equal to 0.402% of the share capital, already held by the Company.

Duration of the program
The buyback program runs from 12 May 2022 and will end by the Shareholders’ Meeting to approve the financial statements for the year ending 31 December 2022, which coincides with the expiration of the authorization to purchase treasury shares approved by the Shareholders’ Meeting on 28 April 2022.
The buyback program may be renewed upon further authorization by the shareholders.

Buyback procedures
The buyback program will be coordinated and executed by an authorized intermediary, who will make the purchases independently, with no influence from Arnoldo Mondadori Editore S.p.A. as regards the timing of the purchases.

Buybacks will be made pursuant to the combined provisions of Article 132 of Legislative Decree no. 58/1998 and of Article 5 of Regulation (EU) 596/2014, Article 144-bis of the Issuer Regulation, and the EU and national legislation on market abuse (including Delegated Regulation (EU) 2016/1052), in accordance with the resolutions of the above Shareholders’ Meeting of 28 April 2022.

Any subsequent changes to the buyback program will be promptly disclosed by the Company.
The transactions made will be disclosed to the market in the manners and within the time limits of applicable law.

For information on the above Performance Share Plans, reference should be made to the information documents prepared pursuant to Article 114-bis of Legislative Decree no. 58/1998 and to Article 84-bis of CONSOB Regulation no. 1197/1999 and available on the website www.gruppomondadori.it (Governance section) and at the authorized storage mechanism 1Info (www.1Info.it).

2022-2024 PERFORMANCE SHARE PLAN: ASSIGNMENT OF RIGHTS
The Board of Directors, having heard the Remuneration Committee, resolved on the assignments to the beneficiaries of the rights relating to the 2022-2024 Performance Share Plan, established by resolution of the Shareholders’ Meeting of 28 April 2022.
Information regarding the beneficiaries and the number of rights assigned are shown – by name, for the beneficiaries who are members of the Board of Directors, and in aggregate form for the other beneficiaries – in the table attached, prepared in compliance with Box 1, Schedule no. 7 of Annex 3A of the Issuer Regulation.
The terms and conditions of the Plan are set out in the Directors’ Explanatory Report to the Shareholders’ Meeting of 28 April 2022 and in the Information Document prepared pursuant to Article 84-bis, paragraph 1 of the Issuer Regulation, available on the website www.gruppomondadori.it Governance section and on the storage mechanism www.1info.it to the contents of which reference should be made.

PUBLICATION OF THE MINUTES OF THE SHAREHOLDERS’ MEETING

Arnoldo Mondadori Editore S.p.A. informs that the minutes of the Ordinary Shareholders’ Meeting held on 28 April 2022 are available on the authorized storage mechanism 1Info (www.1info.it), in the Governance section of the Company website www.gruppomondadori.it and at the Company’s registered office.

The Interim Management Statement at 31 March 2022 will be made available today on the authorized storage mechanism 1Info (www.1Info.it), in the Investors section of the Company website www.gruppomondadori.it and at the Company’s registered office.

The presentation of the results at 31 March 2022, approved today by the Board of Directors is available, on 1Info (www.1info.it), on www.borsaitaliana.it and on www.gruppomondadori.it (Investors section). A Q&A session will be held in conference call mode at 4.30 pm for the financial community, attended by the CEO of the Mondadori Group, Antonio Porro, and the CFO, Alessandro Franzosi. Journalists will be able to follow the meeting in listening mode only, by connecting to the following phone number +39.02.8020927 or via web at: https://hditalia.choruscall.com/?calltype=2.

 The Financial Reporting Manager – Alessandro Franzosi – hereby declares, pursuant to Article 154 bis, paragraph 2, of the Consolidated Finance Law, that the accounting information contained herein corresponds to the Company’s records, books and accounting entries.

 

Annexes (in the complete pdf):

  1. Consolidated balance sheet;
  2. Consolidated income statement;
  3. Group cash flow;
  4. Glossary of terms and alternative performance measures used;
  5. Information pursuant to Schedule 7 of Annex 3a to CONSOB Regulation no. 11971/1999.

[1] Derived from the tax realignment of intangible assets.

[2] GFK, March 2022

[3] GFK (in terms of value)

Mondadori Group: conclusion of the acquisition of 50% of A.L.I. – Agenzia Libraria International

The Mondadori Group announces the conclusion today, through its subsidiary Mondadori Libri S.p.A., of the acquisition of 50% of A.L.I. S.r.l. – Agenzia Libraria International, a company operating in the distribution of books and boasting a client portfolio of over 80 publishers. The transaction takes place in execution of the agreement signed and disclosed to the market last 11 November 2021.

Thanks to this acquisition, the Mondadori Group takes a further step along the path of increasing focus on the books market, through a process of vertical integration that allows the Group to strengthen its position in the promotion and distribution of third-party publishers, with a view to continually improving the service level and expanding the customer portfolio.

As already disclosed, the scope of the transaction includes a number of subsidiaries operating in the publishing field.
The acquisition price, paid in cash on today’s date, is € 10.8 million.

The 50% stake in A.L.I. will be consolidated at equity effective as from 1 May 2022.

The final agreements envisage the acquisition by the Mondadori Group of a further 25% stake in A.L.I., effective as from 28 February 2023, at a price to be set based on average EBITDA 2021-2022. As from 1 March 2023, the company will be then fully consolidated.

The deal also governs the subscription of put&call options, which give Mondadori the right to acquire the remaining 25% of A.L.I. by 30 July 2025 at a price to be set based on average EBITDA 2023-2024.

The members of the Belloni family, the founders of A.L.I., will keep their roles of responsibility in the operational management of the company.

The closing of the acquisition follows the authorization by the competent Antitrust Authority, disclosed on 7 March 2022.

Mention should be made that the 2022 guidance (in particular the estimated Free Cash Flow), disclosed on 16 March, included the financial effects of the above transaction.

 

 

Shareholders’ Meeting approves the 2021 financial statements

Resolution on the distribution of a dividend of € 0.085 per ordinary share

Today, the Shareholders’ Meeting of Arnoldo Mondadori Editore S.p.A., chaired by Marina Berlusconi, approved the financial statements for the year ended 31 December 2021.

The Group’s Chief Executive Officer, Antonio Porro, presented the key figures for the year, as disclosed to the market last 16 March.
Specifically, the net profit, after minority interests, amounted to € 44.2 million, up sharply versus € 4.5 million in 2020.

Today’s Shareholders’ Meeting, in accordance with the proposal of the Board of Directors of 16 March 2022, which has already been the subject of disclosure, resolved to distribute a unit dividend of € 0.085 for each ordinary share (net of treasury shares) outstanding at the record date, for a total of approximately € 22.1 million[1] which corresponds to a pay-out of 50% of the consolidated net profit and a dividend yield equal to 4.2% (at 31 December 2021).
The dividend will be paid, in accordance with the provisions of the “Regulation of the markets organized and managed by Borsa Italiana S.p.A.”, from 25 May 2022 (payment date), with ex-coupon (no. 21) date on 23 May 2022, and with the date of entitlement to payment of the dividend, pursuant to Article 83-terdecies of the TUF (record date), on 24 May 2022.

The Shareholders’ Meeting resolved also on the following additional items on the agenda:

Report on remuneration policy and compensation paid
Pursuant to Article 123-ter of Legislative Decree no. 58/1998, the Shareholders’ Meeting, by means of a binding resolution, approved Section One of the Report on Remuneration Policy and Compensation Paid. The Shareholders’ Meeting also voted in favour of Section Two of the Report.

Renewal of the authorization to purchase and dispose of treasury shares
Following expiry of the term relating to the previous authorization resolved on 27 April 2021, the Shareholders’ Meeting renewed the authorization to purchase and dispose of treasury shares with the aim of retaining for the Board of Directors the applicability of law provisions in the matter of any additional purchase plans and, consequently, of seizing any investment and operational opportunities involving treasury shares.
To date, Arnoldo Mondadori Editore S.p.A. holds a total of no. 1,049,838 treasury shares, equal to 0.402% of the share capital.
Here below is the information provided on the authorization issued by the Meeting, also with reference to the provisions of Article 144-bis of the Issuer Regulation no. 11971/1999:

  • Motivations
    The motivations underlying the request for the authorization to purchase and dispose of treasury shares refer to the opportunity to attribute to the Board of Directors the power:
    – use the Treasury Shares purchased or already in the Company portfolio as compensation for the acquisition of interests within the framework of the Company’s investments;
    – use the treasury shares purchased or already held in portfolio against the exercise of option rights, including conversion rights, deriving from financial instruments issued by the Company, its subsidiaries or third parties and to use the treasury shares for lending, exchange or transfer transactions or to support extraordinary transactions on the Company’s capital or financing transactions that imply the transfer or sale of treasury shares;
    – to undertake any investments, directly or through intermediaries, including for the purpose of containing abnormal movements in share prices, stabilizing share trading and prices, supporting the liquidity of the share on the market, in order to foster  the regular conduct of trading beyond normal fluctuations related to market performance, without prejudice in any case to compliance with applicable statutory provisions;
    – to rely on investment or divestment opportunities, if considered strategic by the Company, also in relation to available liquidity;
    – to dispose of treasury shares as part of share-based incentive plans pursuant to Article 114-bis of the TUF, and of plans for the free allocation of shares to employees or members of the governing or supervisory bodies of the Company or to Shareholders.
  • Duration
    The authorization to purchase treasury shares is set to last until the approval of the financial statements for the year ending 31 December 2022 and, in any case, for a period not exceeding 18 months after the Shareholders’ Meeting resolution, while the authorization to sell is granted to last for an unlimited period, given the absence of provisions in this regard pursuant to the provisions in force and the opportunity to allow the Board of Directors to make use of the maximum flexibility, also in terms of time, to carry out the acts of disposal of the shares.
  • Maximum number of purchasable treasury shares
    The authorization allows the purchase, including in more than one tranche, of ordinary shares of Arnoldo Mondadori Editore S.p.A., with a par value of € 0.26 each, in one or more tranches in an amount freely determinable by the Board of Directors – up to a maximum number of shares – also taking into account the ordinary shares held, directly and indirectly, in the portfolio from time to time – of no more than 10% overall of the share capital.
  • Criteria for purchasing Treasury Shares and indication of the minimum and maximum purchasing cap
    Purchases shall be made in compliance with Articles 132 of the TUF and 144-bis, paragraph 1 letter b) of the Issuer Regulation, and on regulated markets or multilateral trading systems, according to the operating criteria established in the organization and management regulations of the same markets, which do not allow the direct matching of buy orders against predetermined sell orders, and also in compliance with any other applicable law, including EU law. Additionally, share purchase transactions may also be carried out in the manner envisaged in Article 3 of EU Delegated Regulation no. 2016/1052 in order to benefit, if the conditions are met, from the exemption under Article 5, paragraph 1, of EU Regulation no. 596/2014 on market abuse with regard to inside information and market manipulation.
    Regarding the disposal of treasury shares, disposals may be made, on one or more occasions and even before having terminated the maximum number of purchasable treasury shares, either by selling them on regulated markets or according to other trading methods in compliance with the law, including EU law, in force and with the Admitted Market Practices, if applicable.
    Under the proposed authorization, the minimum and maximum purchase price shall be determined at a unit price not lower than the official Stock Exchange price of Mondadori shares on the day preceding the purchase transaction, reduced by 20%, and not higher than the official Stock Exchange price on the day preceding the purchase transaction, increased by 10%.
    In any event – except for any different price and volume determinations resulting from the application of the conditions set forth in the Admitted Market Practices – such price shall be identified in accordance with the trading conditions set forth in Delegated Regulation (EU) no. 1052 of 8 March 2016.
    In terms of consideration, sales transactions or other acts of disposition of treasury shares shall be carried out:
    – if executed in cash, at a price no lower than 10% of the reference price recorded on the MTA – Euronext Milan – organized and managed by Borsa Italiana S.p.A. in the trading session prior to each single transaction;
    – if executed as part of any extraordinary transactions in accordance with financial terms to be determined by the Board of Directors on the basis of the nature and characteristics of the transaction, also taking account of the market performance of Mondadori shares;
    – if executed to service the Performance Share Plans adopted by the Company in compliance with the terms and conditions set out in the resolutions of the Shareholders’ Meeting that establish the Plans and the related regulations.

2022-2024 Performance Share Plan
The Shareholders’ Meeting, pursuant to Article 114-bis of Legislative Decree 58/1998 and in keeping with the introduction of performance share plans approved in the past for the medium/long-term remuneration of executive directors and key management personnel, approved the adoption of a Performance Share Plan for the three-year period 2022-2024 intended for the Chief Executive Officer, the CFO – Executive Director and a number of managers of the Company who have an employment and/or directorship relationship with the Company or its subsidiaries at the date of allocation of the shares.
For a detailed description of the 2022-2024 Performance Share Plan, the beneficiaries and the main characteristics of the Regulation of the Plan, reference should be made to the Information Document pursuant to Article 84 bis of CONSOB Issuer Regulation no. 11971/1999, and the explanatory report of the Board of Directors, available on the Company website www.mondadorigroup.com, Governance/Shareholders’ Meeting section and on the authorized storage mechanism 1Info (www.1Info.it).

[1] Rough estimate based on the number of shares outstanding to date.

Mondadori Group: closing acquisition 50% De Agostini Libri

The Mondadori Group announces the closing today, through its subsidiary Mondadori Libri S.p.A., in execution of the agreement signed and disclosed to the market last 22 November 2021, of the acquisition, from De Agostini Editore, of a 50% stake in the share capital of De Agostini Libri S.r.l., formerly DeA Planeta Libri, specialized in trade books with focus on the children’s and non-fiction segments.

As already disclosed, the scope of the deal includes Libromania S.r.l., wholly-owned by De Agostini Libri and active in the promotion of third-party publishers: the agreements reached include put&call options, exercisable in second half 2022, which entitle the Mondadori Group to acquire 100% of Libromania.

The total maximum value of the acquisition, taking account of the 100% valuation of Libromania, is set at € 4.5 million.

The transaction, which creates a partnership with a time-honoured publishing house boasting a strong heritage and know-how, is in line with the repeatedly announced strategy of increasing the focus on the core business of books, pursued also through a process of vertical integration in the books market.

In 2021, De Agostini Libri reported consolidated revenue of € 13.9 million and EBITDA of € 0.2 million.

The corporate governance structure entitles the Mondadori Group to fully consolidate the stake.

Closing of the acquisition follows the authorization issued by the Antitrust Authority as disclosed last 25 February 2022.

Mondadori Group: publication of 2021 Annual Report and additional documents for AGM

Arnoldo Mondadori Editore S.p.A. announces that the following documents for the Annual General Meeting, to be held on 28 April 2022 in first call (29 April in second call, if any), are publicly available at the Company’s registered office, at the authorized storage mechanism 1info (www.1info.it) and on the website www.gruppomondadori.it (Governance section):

  • the 2021 Annual Report, comprising the draft financial statements, the consolidated financial statements for the year ended 31 December 2021, the Directors’ Report on Operations (including the non-financial statement), the certifications pursuant to art. 154 bis, par. 5, of Legislative Decree no. 58/1998;
  • the Independent Auditors’ reports and the Board of Statutory Auditors’ report;
  • the Report on remuneration policy and compensation paid (prepared pursuant to Article 123-ter of the TUF and 84-quater of the Issuer Regulation);
  • the 2021 Report on corporate governance and ownership structure.

Notice is additionally given that the summary statement pursuant to art. 2429 of the Italian Civil Code is also available at the registered office.

Mondadori Group: publication of documents for the Annual general meeting of 28 april 2022

Arnoldo Mondadori Editore S.p.A. announces that the following documents are publicly available at the Company’s registered office, at the authorized storage mechanism 1info (www.1info.it) and on the website www.gruppomondadori.it (Governance section):

  • the notice of call of the Ordinary Shareholders’ Meeting scheduled for Thursday 28 April 2022 in first call (29 April in second call, if any), together with the Directors’ explanatory report, in accordance with Article 125-ter of the TUF, on each of the items on the agenda;
  • the Information Document prepared pursuant to Article 84-bis of the Issuer Regulation concerning the 2022-2024 Performance Share plan.

The additional AGM documentation will be made available, in the manners above, within the time limits of current laws.

BoD approves results at 31 december 2021

The results achieved in the year beat expectations:

  • Net revenue € 807.3 million: +8.5% versus 2020;
  • Adjusted EBITDA € 105.7 million, improving by € 7.7 million versus 2020; 13.1% margin;
  • Group net profit € 44.2 million versus € 4.5 million in 2020;
  • Cash flow from ordinary operations € 68.2 million versus € 51.2 million in 2020;
  • Free cash flow € 52.1 million versus € 40.7 million in 2020;
  • Net financial position before IFRS 16 at a positive € 37.4 million, net of the effects of the acquisition of D Scuola, including the effects of which the NFP stands at € -94.8 million versus € -14.8 million at 31.12.2020

2022 OUTLOOK

  • Revenue expected to grow mid-single digit;
  • Adjusted EBITDA expected to increase by more than 20%;
  • Net profit expected to rise double-digit;
  • Cash flow from ordinary operations expected in line with 2021;
  • NFP IFRS 16 less than 1.1x adjusted EBITDA.

DIVIDEND DISTRIBUTION PROPOSAL OF € 0.085 PER ORDINARY SHARE

Today, the meeting of the Board of Directors of Arnoldo Mondadori Editore S.p.A., chaired by Marina Berlusconi, reviewed and approved the draft Parent Company and Group consolidated financial statements at 31 December 2021 presented by CEO Antonio Porro.

2021 HIGHLIGHTS
In 2021, the Group was able to open a new chapter in its growth path, while achieving a stronger operating and financial standing.
As proof of its ability to pursue development opportunities, in 2021 Mondadori completed the acquisition of D Scuola – together with Rizzoli Libri the biggest investment in the last 15 years -, which has enabled the Group to gain a leadership position also in the school textbook publishing market and to give substance to its strategy of increasing focus on the core business of books.
This strategic approach also includes further transactions announced during the year: the acquisition of 50% of A.L.I. – Agenzia Libraria International – and DeA Planeta Libri, as well as a further reduction in the exposure to print magazines.

“In 2021 the soundness of our choices rewarded the Mondadori Group with consolidated results above guidance, even though already revised upwards during the year”, pointed out Antonio Porro, Chief Executive Officer of the Mondadori Group. “The buoyant trend of the relevant markets has in fact allowed us to seize an important growth opportunity and, together with greater operating efficiency, has led to a strong increase in both profitability and cash generation. This has brought us the best net result of the last 10 years and a net financial position that has returned to positive again after more than 15 years. The favourable economic backdrop and the financial strength of our Group have therefore paved the way for a return, after 10 years, to a shareholder remuneration policy”, concludes Porro.

PERFORMANCE AT 31 DECEMBER 2021
In 2021, consolidated revenue amounted to € 807.3 million, up by 8.5% versus € 744 million in the prior year, driven by the positive trend that permeated all areas of business, the Books and Retail areas specifically, which benefited in particular from the buoyancy of the Books market.

Adjusted EBITDA in 2021 came to € 105.7 million, up by 7.7 million versus 2020 (€ 98.1 million); this performance reflects, on the one hand, the positive trend in revenue recorded by all business areas and, on the other, the ongoing efforts to curb operating and structural costs implemented by Management.
The reduction versus 2020 in the ratio of fixed costs (overheads and payrolls) on consolidated revenue enabled the Group to confirm its margins to over 13%: net of the relief received to aid museum activities in both years, the Group’s margin would have increased to 12.7% from 12.1%.

EBITDA, amounting to € 91.1 million versus € 84.6 million in 2020, improved by € 6.5 million, despite higher non-recurring expense of € 1.1 million, attributable mainly to restructuring costs recognized in the Media and Corporate & Shared Services areas.

In 2021, EBIT amounted to € 45.2 million, improving stronglyby over 30 million – versus 2020, thanks to the mentioned operating dynamics, but mostly to the presence in the result at 31 December 2020, of higher write-downs for a total of approximately € 22 million.

Consolidated profit before tax came to € 38.6 million versus € 1.6 million in 2020.
On top of that, the following items also contributed to the significant improvement of approximately € 37 million:

  • the reduction of approximately € 1.6 million in financial expense, due mainly to lower average debt and a lower average interest rate as a result of the renegotiation of the lines of credit completed in May 2021, as well as the recognition of certain impairments of receivables at 31 December 2020;
  • the strong improvement in the results of associates (consolidated at equity).

The Group’s net profit, after minority interests, came to € 44.2 million, a sharp increase of approximately 40 million versus € 4.5 million recorded in 2020.

Despite the sharp increase in taxable income, tax components for the year close at a positive € 5.6 million: this is attributable to net non-recurring tax income – deriving from the process of realigning the tax amounts of trademarks and goodwill to their respective statutory amounts – of approximately 19 million.

The Mondadori Group’s net financial position (before IFRS 16) at 31 December 2021, before outlays for the acquisition of D Scuola, after more than 15 years has returned to positive territory and is equal to € 37.4 million, a strong improvement – by over 50 million – versus € -14.8 million at 31 December 2020.

Considering the effects of the extraordinary transaction – completed on 16 December 2021 – and the equity and financial consolidation of the acquiree, the Group’s net financial position (before IFRS 16) stood at € -94.8 million, beating expectations that had estimated net financial debt at year end at approximately € 100 million.
IFRS 16 NFP stood at € -179.1 million (IFRS16 impact € -84.3 million) versus € -97.6 million at 31 December 2020.

At 31 December 2021, the cash flow from operations for the last twelve months came to a positive 79.3 million; the cash flow from ordinary operations (after outlays for financial expense and tax), equal to € 68.2 million (+33.3% versus 2020), allows the Group to continue on the path of strengthening its financial structure, confirming the business’s continued and growing ability to generate cash.
The total free cash flow generated by the Mondadori Group in 2021 exceeded € 52 million, up by 28% versus € 40.7 million in 2020.

At 31 December 2021, Group employees[1] amounted to 1,810 units, down by approximately -2% versus 1,847 units at December 2020, despite the increase in the workforce following the acquisition of Hej! (net of which the reduction would be -2.5%); this decrease is the result of continued efforts to increase the efficiency of the individual business areas.

BUSINESS OUTLOOK
The positive results, the good business outlook and the further improvement in operating performance and cash generation capacity, paint a picture of a very solid Group, allowing it to look forward with greater confidence to the results achievable in the new year, despite the recent challenges posed by the increase in energy prices and the purchase of raw materials, paper first and foremost.

From a strategic point of view, the Company will continue to strengthen its core business and therefore its leadership in the Books area, increasing its relevance and impact on the overall business.

This path will see the Mondadori Group both expand horizontally through entry into new segments of book publishing, including contiguous areas, and continue and consolidate the process of vertical integration launched through the recent acquisitions in the field of book promotion and distribution.

The Group will concurrently continue to develop its digital skills and range of products, and to rationalize its non-strategic activities.

From an operating point of view, the Group’s business-financial targets that follow refer to a scope that includes the transactions concluded in 2021, therefore the consolidation of D Scuola[2] and the deconsolidation of the activities referring to the titles sold; these forecasts, instead, do not include any negative impact from the current context of geo-political instability, and are based on the absence of significant changes in the developments of the health emergency and resulting further discontinuities and slowdowns in economic activities and consumption at a global level.

Income Statement
Against this backdrop, reasonable estimates point to a mid-single digit increase in revenue in 2022
and adjusted EBITDA up by more than 20%.
On a like-for-like basis, these estimates would translate into a top-line and low single-digit margin growth, confirming the ongoing cost containment actions aimed also at offsetting in 2022 the negative impact of the increase in costs relating to raw materials and energy consumption.

Net profit in 2022 is expected to grow double-digit, despite the absence of the significant tax component[3], amounting to approximately € 19 million, which had benefited net profit in 2021, thanks also to non-recurring expense much lower than the figure recorded in 2021.

Cash Flow and Net Financial Position
In 2022, the Group is expected to confirm the significant cash generation capacity shown in recent years:

  • Cash Flow from ordinary operations is reasonably expected to be basically in line with the 2021 figure due, on the one hand, to the positive contribution of D Scuola, and, on the other, to a “one-off” increase in the Group’s capital expenditure deriving:
    – in the school segment, from a stronger and richer product range and publishing catalogue;
    – in the Retail area, from the project on the renovation of the flagship store in Piazza Duomo, Milan, which will see the light in the second half of the year;
  • this points to an estimate of a Free Cash Flow for 2022 – before payout of the dividend but net of the forecasts on cash outflows from the extraordinary transactions announced – in the region of € 40/45 million and a Group net debt (IFRS16) of less than 1.1x Adjusted EBITDA (0.6x before IFRS16).

The financial solidity reached allows the Group to continue its path of virtuous development, especially in the book business, also through M&As: therefore, the Group will continue, also in the current year, to pursue further growth opportunities through acquisitions, in a resolute and active way.

After more than 10 years, the Group has seen a return to solid conditions for a renewed shareholder remuneration policy with the intent – for the next three years – of distributing 40% of Cash Flow from Ordinary Operations per year, maintaining a minimum floor equal to the Dividend Per Share of 2021. During this period, the Board of Directors, when proposing the distribution to the Shareholders’ Meeting, will in any case take account of the general macroeconomic scenario, any business plans and investment requirements, as well as the expected cash flows that will affect the Group’s equity and financial structure.

PERFORMANCE OF BUSINESS AREAS

  • BOOKS

2021 showed a book market growth of 14.7%[4] versus 2020 and 18.5% versus 2019, a year still unscathed by the distorting effects of the pandemic.

The Group was able to benefit from this market buoyancy: the Trade Books area saw an increase in sell-out in terms of value of approximately 10% versus 2020, and was once again able to retain its leadership at national level, with a market share of 23.7%[5], also confirmed by the presence of 5 titles in the list of the 10 bestselling books of the year.

In the school textbooks segment, the Group achieved a steady adoption market share (22.1%[6]), proof of the excellent results achieved and the quality of the editorial offering of the Mondadori Education and Rizzoli Education publishing houses. Including the acquisition of D Scuola, the pro forma 2021 market share would stand at 32.9%, giving the Group a leadership position also in the school textbooks publishing market.

In 2021, revenue from the Books area amounted to € 465 million, up by approximately 10% versus € 422.9 million in the prior year, broken down as follows:

  • +10.6% in the Trade area, which published 2,495 titles in the period (versus 2,193 in 2020), returning production to pre-pandemic levels.
  • +9.4% in the Educational segment, which benefited from increased revenue from both the school textbooks segment (+4.2%) and Rizzoli International Publications (+24.1%).
  • +5.2% in the distribution of third-party publishers.

Adjusted EBITDA in the Books area came to € 92.6 million in 2021, improving by approximately 5 million versus € 87.5 million in 2020, thanks to the strong revenue growth that more than offset the lower relief paid to Electa (approximately € 5 million) in the museum segment versus the prior year.
Profitability achieved by the Books area in 2021 was approximately 20%.

  • RETAIL

As mentioned earlier, the books market grew by 14.7%[7] in 2021 versus 2020, driven mainly by the physical channel. Against this backdrop, Mondadori Retail’s market share stood at 11.4%, propelled by the outstanding performance of the physical network of directly-managed stores and franchises.

The 2021 income statement figures show a strong growth in revenue and margins in the area, thanks to the renewal and development process launched in recent years, which improved operating and management performance.

Revenue amounted to € 173.9 million, up by 20.2 million (+13.1%) versus € 153.7 million in the prior year, as a result of the positive performance of the book product (+16.7%), which now accounts for more than 80% of revenue[8] in the area. Specifically:

  • directly-managed stores saw a strong recovery in revenue (+20.2% versus the prior year), thanks to the strategy of focusing on the core business of books and the abovementioned network development and maintenance activities;
  • the franchised channel, composed mainly of proximity stores located in small towns, continued its progression, increasing by +9% versus the prior year;
  • revenue from the Bookclub returned to growth (+5.3%), while revenue from the online channel settled at € 15.6 million, down versus the prior year but improving by approximately 12% versus 2019.

In 2021, the area recorded significant growth in adjusted EBITDA, which stood at € 5.1 million (€ +3.9 million versus 2020 and up also versus 2019).

This improvement is attributable to the strong ongoing renewal and development of the network of physical stores, to careful cost management and a thorough review of the organization and processes, as well as the constant work on product innovation and enrichment of the editorial offer, accompanied by new services and communication formats for customers and partners.
The structural actions adopted over the past few years have brought a strong turnaround in the company’s operating and financial performance, with results that are on the rise also versus 2019.

  • MEDIA

The Media area reported revenue of € 206.6 million in 2021, up by 4.5% versus € 197.6 million in the prior year.
Specifically:

  • circulation revenue was down by 7.1%, showing a performance in line with the relevant market, with a market share of 1%, steady versus 2020 (approximately 20% net of the two titles sold at end 2021) 21;
  • revenue from add-on products was down by 15.8% versus 2020, hit by the negative impact of the lower availability of DVD titles due to the absence of significant film releases caused by the ongoing pandemic;
  • advertising revenue grew by approximately 27% overall (+15% excluding the contribution of the acquisition of Hej!):
    – digital activities grew by 40%, thanks also to the contribution of AdKaora and the consolidation of Hej! (+18% excluding this acquisition);
    – advertising sales on print magazines rose by approximately 10%, thanks also to the rebound in advertising investments.
    Mention should be made that the percentage of digital revenue on total advertising revenue is over 62% (from 57% in 2020), confirming Mondadori Media’s leadership position in digital and social media and the decreasing dependence of the business unit’s revenue on print advertising sales.
  • Other revenue, which includes revenue deriving from distribution activities, posted a 10% increase versus the prior year, reflecting growth in the distribution activities of third-party publishers in the newsstand channel.

Adjusted EBITDA in the Media area amounted to € 12.4 million, up by more than 50% versus 2020 (€ 7.9 million), and also higher than the € 11.3 million recorded in 2019, driven by the development of digital activities and, in the print area, the recovery of advertising sales and the continued measures to contain operating costs, which brought an increase in profitability: in fact, the overall EBITDA margin improved by two percentage points, rising from 4% in 2020 to approximately 6%.
Specifically, digital activities, including Hej!, contributed approximately € 10 million to the overall result, also as a result of a percentage margin of over 20%.

PERFORMANCE OF ARNOLDO MONDADORI EDITORE S.P.A.
The Parent Company’s income statement for the year ended 31 December 2021 shows the same profit as the consolidated financial statements, amounting to € 44.2 million (€ 4.5 million in 2020), due to the adoption of the equity method to measure the Company’s investments in the separate financial statements.

Revenue, amounting to 41.1 million, was down by approximately € 4 million versus the prior year, due primarily to a changed scope of the costs of the central units charged back to subsidiaries.

Adjusted EBITDA deteriorated from € -0.9 million to € -5.4 million, attributable mainly to the abovementioned reduction in chargebacks to subsidiaries.
2021 includes negative non-ordinary items totaling € 6 million, attributable mainly to provisions for restructuring costs.
Amortization and depreciation in 2021, amounting to € 9.5 million, was basically steady versus 2020 (€ 9.9 million).
2021 includes lower net financial expense for a total of € 0.7 million.

The positive contribution from the equity measurement of investments amounted to € 65.3 million, a sharp increase versus € 13.2 million in the prior year, due mainly to the write-back of the subsidiaries Mondadori Libri S.p.A. and Mondadori Media S.p.A..

The Parent Company’s net profit, amounting to € 44.2 million (versus € 4.5 million in 2020), benefited from the tax income of € 3.2 million recognized in 2021 (€ 8.6 million in 2020 following recognition of the “Patent box” relief for € 5.2 million).

DIVIDEND DISTRIBUTION PROPOSAL OF € 0.085 PER ORDINARY SHARE
As repeatedly mentioned, the favourable economic backdrop and the financial solidity achieved by the Group have paved the way for a return to a shareholder remuneration policy: based on the results of 2021, the Board of Directors has proposed to the next Shareholders’ Meeting, convened on 28 April 2022, the distribution of a unit dividend of € 0.085 for each ordinary share (net of treasury shares) outstanding at the record date, for a total of approximately € 22.1 million[9], equal to a pay-out of 50% of the consolidated net profit and a dividend yield of 4.2% (at 31 December 2021).
The dividend will be paid, in accordance with the provisions of the “Regulation of the markets organized and managed by Borsa Italiana S.p.A.”, from 25 May 2022 (payment date), with ex-coupon (no. 21) date on 23 May 2022 (ex date) and with the date of entitlement to payment of the dividend, pursuant to Article 83-terdecies of the TUF (record date), on 24 May 2022.

SIGNIFICANT EVENTS AFTER YEAR-END 2021
On 25 February 2022, the Mondadori Group announced that it had received notice from the Antitrust Authority of the authorization to acquire from De Agostini Editore S.p.A. a 50% stake in the share capital of DeA Planeta Libri S.r.l..
The Authority’s go-ahead triggered the fulfilment of the suspensive condition of the agreement on the sale of the stake; the sale will therefore be fully implemented on the closing date, scheduled by March, as from which the company will be known as De Agostini Libri S.r.l..
On 7 March 2022, the Mondadori Group announced that it had received notice from the Antitrust Authority of the authorization to acquire a 50% stake in A.L.I. S.r.l. – Agenzia Libraria International, specialized in the distribution of books.
Following authorization from the above Authority, the transaction will be fully implemented on the closing date, which is scheduled to take place by April.

PROPOSED RENEWAL OF THE AUTHORIZATION TO PURCHASE AND DISPOSE OF TREASURY SHARES
Following expiry of the previous authorization resolved upon by the Shareholders’ Meeting on 27 April 2021, with the approval of the financial statements at 31 December 2021, the Board of Directors will propose to the next Shareholders’ Meeting the renewal of the authorization to purchase and dispose of treasury shares with the aim of retaining the applicability of law provisions in the matter of any additional buyback plans and, consequently, of seizing any investment and operational opportunities involving treasury shares.
Below are the key elements of the Board of Directors’ proposal:

  • Motivations
    The motivations underlying the request for the authorization to purchase and sell treasury shares refer to the opportunity to attribute to the Board of Directors the power to:
    – use the Treasury Shares purchased or already in the Company portfolio as compensation for the acquisition of interests within the framework of the Company’s investments;
    – use the treasury shares purchased or already held in portfolio against the exercise of option rights, including conversion rights, deriving from financial instruments issued by the Company, its subsidiaries or third parties and to use the treasury shares for lending, exchange or transfer transactions or to support extraordinary transactions on the Company’s capital or financing transactions that imply the transfer or sale of treasury shares;
    – undertake any investments, directly or through intermediaries, including for the purpose of containing abnormal movements in share prices, stabilizing share trading and prices, supporting the liquidity of the share on the market, in order to foster the regular conduct of trading beyond normal fluctuations related to market performance, without prejudice in any case to compliance with applicable statutory provisions;
    – rely on investment or divestment opportunities, if considered strategic by the Board of Directors, also in relation to available liquidity;
    – dispose of treasury shares to service share-based incentive plans set up pursuant to Article 114-bis of the TUF, and plans for the free allocation of shares to employees or members of the governing bodies of the Company or to Shareholders.
  • Duration
    The authorization to purchase treasury shares runs from the date of any resolution approving the proposal by the Shareholders’ Meeting, until the Shareholders’ Meeting called to approve the financial statements at 31 December 2022 and, in any case, for a period no more than 18 months.
    The authorization to dispose of treasury shares is requested for an unlimited period, given the absence of time limits pursuant to current regulations and the opportunity to allow the Board of Directors to make use of the maximum flexibility, also in terms of time, to carry out any disposal of shares.
  • Maximum number of purchasable treasury shares
    The authorization would allow the purchase, including in more than one tranche, of ordinary shares of Arnoldo Mondadori Editore S.p.A., with a par value of € 0.26 each, in one or more tranches in an amount freely determinable by the Board of Directors – up to a maximum number of shares – also taking into account of the ordinary shares held, directly and indirectly, in the portfolio from time to time – of no more than 10% overall of the share capital, in accordance with Article 2357, paragraph 3, of the Italian Civil Code.
  • Criteria for purchasing treasury shares and indication of the minimum and maximum purchasing cap
    Purchases shall be made in compliance with Article 132 of the TUF, 144-bis, paragraph 1 letter b) of the Issuer Regulation, and on regulated markets or multilateral trading systems, according to the operating criteria established in the organization and management regulations of the same markets, which do not allow the direct matching of buy orders against predetermined sell orders, and also in compliance with any other applicable law, including EU law. Additionally, share purchase transactions may also be carried out in the manner envisaged in Article 3 of EU Delegated Regulation no. 2016/1052 in order to benefit, if the conditions are met, from the exemption under Article 5, paragraph 1, of EU Regulation no. 596/2014 on market abuse with regard to inside information and market manipulation.
    Regarding the disposal of treasury shares, disposals may be made, on one or more occasions and even before having terminated the maximum number of purchasable treasury shares, either by selling them on regulated markets or according to other trading methods in compliance with the law, including EU law, in force and with the Admitted Market Practices, if applicable.

    Under the proposed authorization, the minimum and maximum purchase price shall be determined at a unit price not lower than the official Stock Exchange price of Mondadori shares on the day preceding the purchase transaction, reduced by 20%, and not higher than the official Stock Exchange price on the day preceding the purchase transaction, increased by 10%.
    In any event – except for any different price and volume determinations resulting from the application of the conditions set forth in the Admitted Market Practices – such price shall be identified in accordance with the trading conditions set forth in Delegated Regulation (EU) no. 1052 of 8 March 2016.

    In terms of consideration, sales transactions or other acts of disposition of treasury shares shall be carried out:
    – if executed in cash, at a price no lower than 10% of the reference price recorded on the MTA – Euronext Milan – organized and managed by Borsa Italiana S.p.A. in the trading session prior to each single transaction;
    – if executed as part of any extraordinary transactions in accordance with financial terms to be determined by the Board of Directors on the basis of the nature and characteristics of the transaction, also taking account of the market performance of Mondadori shares;
    – if executed to service the Performance Share Plans adopted by the Company in compliance with the terms and conditions set out in the resolutions of the Shareholders’ Meeting that establish the Plans and the related regulations.

To date, Arnoldo Mondadori Editore S.p.A. holds a total of no. 1,049,838 treasury shares, equal to 0.402% of the share capital.

For further information on the proposed authorization for the purchase and disposal of treasury shares, reference should be made to the Directors’ Explanatory Report, which will be published within the time limits and in the manner prescribed by applicable regulations.

GRANTING OF SHARES UNDER THE 2019-2021 PERFORMANCE SHARE PLAN: INFORMATION PURSUANT TO ART. 84-BIS, PARAGRAPH 5 CONSOB REGULATION NO. 11971/1999
The Board of Directors, based on the final assessment of the Performance Targets underlying the Plan, and having heard the Remuneration and Appointments Committee, resolved to allocate a total of no. 311,848 Arnoldo Mondadori Editore S.p.A. shares to 8 beneficiaries, in implementation of the provisions contained in the “2019-2021 Performance Share Plan” established by the Board of Directors on 14 March 2019 and subsequently adopted by the Shareholders’ Meeting on 17 April 2019 (the “2019-2021 Plan”).
Mention should be made that the 2019-2021 Plan takes the form of a share granting plan and grants its beneficiaries the right to receive, free of charge, shares in the Company provided that, at the end of a reference period of three financial years, the performance targets set in the same Plan have been achieved.
The 8 beneficiaries of the 2019-2021 Plan are the Chief Executive Officer and 7 managers identified by name by the Chief Executive Officer, as delegated by the Board of Directors.
The characteristics of the 2019-2021 Plan are explained in detail in the Directors’ Report to the Shareholders’ Meeting of 17 April 2019 and in the information document contained therein, available on www.gruppomondadori.it, Governance section, to which reference should be made.
Attached is the information required by Schedule 7 of Annex 3A to CONSOB Regulation no. 11971/1999 to account for the granting of shares in the context of the 2019-2021 Performance Plan.

 

PROPOSED ADOPTION OF A 2022-2024 PERFORMANCE SHARE PLAN
The Board resolved, on a proposal from the Remuneration and Appointments Committee, and in keeping with the introduction of the performance share approved last year for the medium/long-term remuneration of executive directors and key management personnel, to submit to the approval of the Ordinary Shareholders’ Meeting, the adoption of a 2022-2024 Performance Share Plan, in accordance with Article 114-bis of Legislative Decree no. 58 of 24 February 1998, intended for the Chief Executive Officer, the CFO – Executive Director and a number of Company managers who have an employment and/or directorship relationship with the Company or with its subsidiaries on the granting date of the shares.

With the adoption of the Plan, the Company aims to encourage Management to improve medium to long-term performance, in terms of both industrial performance and growth in the value of the Company.
The Plan envisages the assignment to the beneficiaries of rights to the free allocation of company shares, subject to the achievement of specific performance targets set and measured at the end of the three-year performance period.
These targets are structured to include both shareholder remuneration indicators and management indicators functional to raising the share value, ensuring maximum alignment of Management remuneration and the creation of value for the Company, as well as indicators of a non-operating/financial nature.
For details on the proposed adoption of the 2022-2024 Performance Share Plan, the beneficiaries and the main characteristics of the Regulations of the Plan, reference should be made to the Information Document drawn up by the governing body, pursuant to Article 84-bis and annex 3A of the Issuer Regulation, and to the Explanatory Report, which will be published within the time limits and in the manner prescribed by applicable regulations.

CONSOLIDATED NON-FINANCIAL STATEMENT PURSUANT TO LEGISLATIVE DECREE 254/2016
Under Legislative Decree 254/2016, the Board of Directors’ 2021 Report on Operations of the Mondadori Group is also composed of the Consolidated Non-Financial Statement (NFS), a qualitative-quantitative description of the non-financial performance of the Company, associated with environmental, social, and staff-related issues, as well as those regarding respect for human rights, and the fight against corruption and bribery, which are relevant given the activities and characteristics of the Company. The NFS was prepared in accordance with GRI Standards: Core option, and includes benchmark KPIs related to GRI G4 “Media Sector Disclosure”.
With regard to 2021, the Mondadori Group has updated its materiality analysis, consistent with the principles set out by the GRI Sustainability Reporting Standards (GRI Standards) and the reporting scopes laid down by Legislative Decree 254/2016.
With a view to continuous improvement of the process, in 2021 the stakeholder engagement activity was expanded by involving employees and teachers, who were given a specific online questionnaire on sustainability issues.
The document also contains relevant information in line with ESMA’s recommendations for the 2021 reporting year, and includes references required by Regulation (EU) 2020/852 related to the recent introduction of the EU Taxonomy.

The findings from the reporting include a number of tangible actions regarding social, governance and environmental issues. These include: the creation of the position of Chief Diversity Officer for the implementation of strategies and projects aimed at promoting diversity, equity and inclusion; in keeping with the measures adopted to combat the spread of COVID-19, the possibility offered to employees and associates to carry out and repeat diagnostic screenings free of charge; access, as part of the New Competencies Fund (NCF), to a training and professional development path intended as a strategic lever to encourage and strengthen internal skills and competencies and the attraction of young talents.
During the year no cases of corruption or bribery involving the Company or its employees were reported, and no legal action was initiated or concluded against the Group or its employees for cases of corruption or reports made within the whistleblowing system.
In 2021, the Mondadori Group once again paid special attention to environmental issues and the specific impacts associated with the life cycle of paper products, energy efficiency measures and the reduction of climate-changing emissions: an approach that guides the Company in the implementation of its business activities, from the purchase of certified paper to the efficient management of points of sale. As for the sourcing of raw materials for the printing of publishing products, the Group opts for the use of paper certified under the two main schemes applied worldwide, PEFC and FSC, whose percentage reached 99.9% of the total during the year.

SUSTAINABILITY PLAN GUIDELINES
The Mondadori Group has launched its first-ever Sustainability Plan, which identifies short, medium and long-term targets and actions to improve performance in social, governance and environmental terms.
The reflection process led to the identification of the areas and strategic lines of sustainability on which the Group intends to work in the future through the achievement of targets set on an annual basis and periodically updated.
The 3 relevant macro areas – defined below – and the respective guidelines identified for 2022, reflect the Group’s identity, its mission and its role as a publisher:

Social: enhancing people, content and places for education and culture

  • To become a role model in the field of diversity, equity and inclusion, enhancing and contributing to the well-being of our people, through welfare tools and skills development.
  • To promote culture and quality, equitable, and inclusive education that fosters pathways to lifelong learning.
  • To create, conceive and develop valuable content and affordable, ESG-friendly products.
  • To support cultural outposts for social development through the enhancement of bookstores, schools, museums, social channels, events and partnerships.

Governance: promoting sustainable business success

  • To pursue sustainable business success by promoting the integration of ESG issues in governance, business plans and the operating model, also by strengthening the mechanisms for listening to stakeholders to develop paths of ongoing improvement.
  • To maintain the highest standards for protecting and managing risks and opportunities along the value chain.

Environment: disseminating environmental culture and mitigating impacts on ecosystems

  • To spread environmental culture, also through education aimed at an increasingly sustainable development and lifestyle.
  • To mitigate environmental impacts throughout the product life cycle, by fostering the protection of biodiversity and reducing climate-changing emissions.


The results for the year ended 31 December 2021, approved on today’s date by the Board of Directors, will be presented by the Mondadori Group Management to the financial community in a webcast presentation scheduled today at 3:30 PM.

The corresponding documentation will be available on 1Info (www.1info.it), www.borsaitaliana.it and www.gruppomondadori.it (Investors). Journalists will be able to follow the presentation in listening mode only, by connecting to the following telephone number +39028020911 and via web https://www.c-meeting.com/web3/join/M37DCPDPQUB3KL. At the end of the meeting, a dedicated session is scheduled where questions may be submitted to management.

The Financial Reporting Manager – Alessandro Franzosi – hereby declares, pursuant to Article 154 bis, paragraph 2, of the Consolidated Finance Law, that the accounting information contained herein corresponds to the Company’s records, books and accounting entries.

Annexes (in the complete pdf):

  1. Consolidated balance sheet;
  2. Consolidated income statement;
  3. Consolidated income statement – fourth quarter;
  4. Group cash flow;
  5. Arnoldo Mondadori Editore S.p.A. balance sheet;
  6. Arnoldo Mondadori Editore S.p.A. income statement;
  7. Arnoldo Mondadori Editore S.p.A. statement of cash flows;
  8. Glossary of terms and alternative performance measures used;
  9. Information pursuant to Schedule 7 of Annex 3a to CONSOB Regulation no. 11971/1999


[1] The workforce at 31 December 2021 does not include D Scuola’s headcount, but does include employees from the two titles, the sale of which became effective on 1 January 2022.

[2] Excluded are the transactions that were under Antitrust scrutiny at 31 December 2021 (acquisition of 50% of A.L.I. and 50% of DeA Planeta, sale of 51% of Press-di).

[3] Derived from the tax realignment of intangible assets.

[4] GfK, December 2021 (figures in terms of market value; 52-week survey in 2021 vs. 53 weeks in 2020)

[5] GfK, December 2021 (figures in terms of market value)

[6] ESAIE, 2021 (number of adopted sections)

[7] GFK (in terms of value)

[8] Product revenue excluding Club revenue

[9] Rough estimate based on the number of shares outstanding at the date of this Report.

Mondadori Group: Antitrust gives go-ahead to acquisition of 50% of the books distribution company of third-party publishers A.L.I. – Agenzia Libraria International

The Mondadori Group announces that it has received notice from the Antitrust Authority of the authorization to acquire – as disclosed last 11 November 2021 – a 50% stake in A.L.I. S.r.l. – Agenzia Libraria International, specialized in the distribution of books.

Following authorization from the above Authority, the transaction will be fully implemented on the closing date, which is scheduled to take place by April.

Notice on total amount of voting rights

Pursuant to art. 85-bis, paragraph 4-bis of CONSOB Regulation no. 11971 of 14 May 1999, Arnoldo Mondadori Editore S.p.A. announces the amount of voting rights updated following the deregistration, on 18 February 2022, of 15,000 shares with increased voting rights.

The total amount of voting rights, indicating the number of shares forming the share capital, is outlined below.

 

Updated situationPrevious situation
Number of shares forming the share capitalNumber of voting rightsNumber of shares forming the share capitalNumber of voting rights
Total of which:261,458,340400,817,990261,458,340400,832,990
Ordinary shares ISIN IT0001469383 (with regular dividend entitlement: 01/01/2021) current coupon number: 21122,098,690122,098,690122,083,690122,083,690
Ordinary shares with increased voting right ISIN IT0005366684 (with regular dividend entitlement: 1/01/2021) current coupon number: 21139,359,650278,719,300139,374,650278,749,300

Mondadori Group: Antitrust authorizes acquisition of 50% of DeA Planeta Libri

The Mondadori Group announces that it has received notice from the Antitrust Authority of the authorization to acquire from De Agostini Editore S.p.A. a 50% stake in the share capital of DeA Planeta Libri S.r.l., a transaction disclosed last 22 November 2021.

The Authority’s go-ahead triggers the fulfilment of the suspensive condition attached to the agreement on the sale of the stake; the sale will therefore be fully implemented on the closing date, scheduled by March, as from which the company will be known as De Agostini Libri S.r.l..