A N N U A L R E P O R T

Transcription

1 ANNUAL REPORT

2 >> CONTENTS 2

3 ANNUAL REPORT 2013 * ) Group Structure...4 Key Figures in Brief... 6 Otava Group s Values... 7 Otava Group Agency... 8 Review by the Chairman of the Board Board of Directors Review by the Board of Directors Consolidated Income Statement Consolidated Cash Flow Statement Consolidated Balance Sheet Auditor s Report...17 Group Organisation Corporate Responsibility Contacts *) This is a summary and translation of the original Finnish annual report. OTAVA GROUP 3

4 GROUP STRUCTURE 2013 Otava Ltd Otava Publishing Company Ltd Suomalainen Kirjakauppa Oy Otavamedia Ltd NettiX Oy Like Publishing Ltd Suomen Golfpiste Oy Ampparit Oy Otava Book Printing Ltd Finnish Press Agency Ltd DeCo Media Oy Ühinenud Ajakirjad AS Lakiperintä Oy THE GROUP S business areas are book publishing (Books), book sales (Trade), magazine publishing (Magazines) and New Business Functions. The company was established in 1890 with the founding of Otava Publishing Company Ltd, which commenced printing operations in 1908 and magazine publishing in 1916 (Suomen Kuvalehti). Otava was a founding member of Otavamedia Ltd (1934, previously United Magazines Ltd) and The Great Finnish Book Club Ltd (1969). The Group expanded its online business with the acquisition of Plaza and NettiX Oy in 2006, as well as Ampparit Oy in In 2011, Otava Ltd acquired the entire stock of Suomalainen Kirjakauppa Oy. The Group s parent company is Otava Ltd. The Group is a private, independent, impartial and financially sound media corporation. In 2013, Otava Group became the second largest graphic communications publisher in Finland. BOOKS The principal company of the Books division is Otava Publishing Company, which is the second largest book publisher in Finland. The company publishes Finnish-language fiction, non-fiction and educational material. Like Publishing Ltd has been a part of the division since the beginning of Otava Book Printing Ltd is a modern and versatile printing house and book-binding company that produces books for a number of publishers in Finland and abroad. The company s printing house operates in Keuruu, central Finland. TRADE Suomalainen Kirjakauppa Oy is engaged in the retail sales of books. The company has a network of 61 book stores throughout Finland. It is the largest company in its field and also has an online book shop, suomalainen.com. MAGAZINES The Group s Magazines division comprises Otavamedia Ltd and its subsidiaries, which engage in the publication of customer magazines and periodicals as well as book club activities. Otavamedia s Customer Communications offices are located in Helsinki and Turku. Since 2011, DeCo Media Oy, a webcast and video production company, has been part of the division. The book club activities are undertaken under the Great Finnish Book Club brand. Otavamedia has a subsidiary in Estonia (Ühinenud Ajakirjad AS), which focuses on the magazine business. Suomen Golfpiste Oy, which has been part of the division since 2007, maintains the golfpiste.com portal and publishes GolfLehti (Golf Magazine). Otavamedia s subsidiary, Finnish Press Agency Ltd, is an image agency that has transmitted illustrations and news photographs from both Finland and abroad since NEW BUSINESS FUNCTIONS The Group s New Business Functions comprise the Plaza portal and NettiX Oy, which were acquired in The numerous websites of NettiX Oy function as electronic marketplaces, the best known of which are nettiauto.com and nettivene.com. In spring 2012, NettiX Oy acquired 65% of the stock of Ampparit Oy. This company maintains the ampparit.com news portal and sells media monitoring services. 4

5 Key Figures Net sales, M Operating profit, M Debt development, M Net sales EBITA Depreciation on goodwill and business acquisition costs Operating profit Profit before taxes Profit for the financial year Cash flow from operations BALANCE SHEET AND PROFITABILITY Capital expenditure Equity Non-current liabilities Current liabilities Equity ratio % Return on investment (ROI) % Return on equity (ROE) % Group personnel (average) 1,178 1,249 1, BOOKS Net sales EBITA Volumes of operation: New titles published New editions 1,019 1,345 1,217 1, Books sold, million Books printed, million TRADE *) Net sales EBITA Volumes of operation: Number of customers, million Books sold, million MAGAZINES Net sales EBITA Volumes of operation: Number of magazines and periodicals **) Annual magazine sales, million **) Books sold (Great Finnish Book Club), million NEW BUSINESS FUNCTIONS Net sales EBITA *) The figures for 2011 represent 12 months (included in the consolidation with Otava as from 1 October 2011) **) General-circulation, customer and online magazines OTAVA GROUP 5

6 >> IN BRIEF 2013 in Brief BOOKS Kreetta Onkeli s Poika joka menetti muistinsa won the Finlandia Junior prize and Marja Björk s novel Poika was a nominee. Kjell Westö s Kangastus 38 was a nominee for the Finlandia Prize and August Prize, as well as for the Nordic Council Literature Prize. Sofi Oksanen was the first Finnish woman to be granted the prestigious Swedish Academy Nordic Prize. Peter von Bagh was granted the Mel Novikoff Award for life work in international film as well as the Warelius award of the Finnish Association of Non-fiction Writers. Otava began publishing a Finnish edition of the Granta magazine. Otava launched a new book format, the Miki mini books. Otava was the first company in Finland to publish digital upper secondary school textbooks. Since the beginning of the year, all the books printed by Otava Book Printing have had the right to use the well-known eco-label Joutsenmerkki. TRADE Despite the difficult economic situation, the sales of the book sales business area reached last year s level. Marketing investments and campaigns successfully supported the Suomalainen Kirjakauppa brand and multi-channel sales. The average purchase and sales margin showed improvement. Inventory management was improved: rotation improved in all groups and capital expenditure was lower. Seven stores were modernised. A new operating model for occupational health was implemented. Operating profit was good. MAGAZINES Net sales in the business area were down, but relative profitability remained good. Changes in value added tax and consumers use of media brought the numbers of magazine subscribers down. Printed media sales were down in line with the market, but online media sales grew faster than the market. The number of publishing units decreased by one. Katriina Kaarre and Tarja Hurme were appointed heads of the new publishing units. In publishing unit 1, the magazines were gathered into four families. Publication of Käytännön Maamies, KM Vet and Moottori was discontinued. An agreement was reached with the Finnish Golf Union concerning the publication of GolfLehti. Suomenkuvalehti.fi was remodelled as a digital service that combines a digital magazine and a website. All Otavamedia s operations in the Helsinki region were centralised into premises in Pasila. The company bought the plots of Maistraatinportti and Esterinportti from the City of Helsinki. NEW BUSINESS FUNCTIONS The Ampparit news service was read more than 15 million times a week. The services offered by NettiX now also include online store and website technologies. The Hintalaskuri ( Price calculator ) function was developed for the Nettiauto service, which provides values for used cars. Separate, mobile-optimised versions of Otavamedia s website were developed. In Otavamedia s products, advertisers can now reach target groups according to interest in a multi-channel environment. 95 people from the Group have participated in the digital media skills training programme. 6

7 Otava Group s Values RESPONSIBILITY Otava Group is owned by a Finnish family of entrepreneurs. Since it began operating over a century ago, Finnish values have been a key part of Otava Group s operations. We aim to do our part in supporting and promoting culture, growth and learning. Fostering and developing the Finnish language is essential. Each and every one of us is responsible for our own work performance, which is guided by the values of openness, reliability and independence. In its operations, the company is stable and independent, emphasising freedom of speech as the basis of publishing. QUALITY Our goal is excellent quality. This can be achieved through the creative, free and responsible work of all employees and partners. Quality is based on individual, freely defined ways of working that everyone can be proud of. We stand by what we do. Quality is based on meeting the needs of our customers. Thus, quality also means competitive products and services, financially profitable operations and the ability to enhance our working methods and develop professionally. COURAGE Our operations are based on courage, independence and openness. The publishing policy is pluralistic, liberal and tolerant. We set ambitious targets, want results and think from a commercial point of view. We learn and improve, and can take swift action. Our goal is to be competitive in the short term and financially successful in the long term. Passion, initiative and an enterprising approach to work speak of our personnel s courage and open-mindedness. CLOSENESS We are committed to our personnel and are close to our partners. Our personnel aim to develop to meet the needs of our customers. We are committed to our customers, authors, readers and other partners. We work together in a good atmosphere extending beyond unit and company boundaries, and we respect others. We combine old and new in a unique way. Our books, magazines and other products evoke feelings and experiences. We put our hearts into our work. OTAVA GROUP 7

8 >> OGA 8

9 OTAVA GROUP AGENCY KUSTANNUSOSAKEYHTIÖ OTAVA is a bold, principled publisher whose current roster of authors includes leading writers from Finland and abroad, much-loved storytellers and promising young authors. Otava also publishes pedagogically approved learning materials written by Finnish teachers and authors. Tradition and new ideas walk hand in hand at Otava, and Otava s publishing is guided by an exuberant enthusiasm and a commitment to high quality. Otava Group Agency (OGA) was founded 2006 and sells foreign rights to fiction, illustrated and narrative non-fiction, and children s books from Otava and LIKE Publishing. It sells translation rights worldwide, directly and through sub-agents in selected markets, for authors and titles in all genres. In 2013 OGA also began representing film, TV, play and licensing rights on behalf of selected authors. In 2013, the Finnish version of Granta* was launched. Most of OGA s authors are featured in the first issue, and this presents fantastic new opportunities for authors to join Granta s worldwide network. 2014: FINNLAND.COOL The Frankfurt Book Fair is the world s leading event for the publishing and media industries, and Finland has been designated the Guest of Honour for The Finnish Literature Exchange (FILI) is coordinating Finland s presence at what will be the country s most high-profile cultural export event. Central to this Guest of Honour project is the sale of translation rights. Another important thread running through the project is new ways of reading and learning. FILI is also in charge of exhibitions on Finnish culture to be staged in museums and other art institutions in Frankfurt. Other cultural programmes in Germany and Germanspeaking parts of Europe are being coordinated by the Finnish Institute in Germany. OGA is present at the Frankfurt Book Fair in its own familiar location, part of the FINNLAND. COOL stand, in Hall 5. Otava s learning materials will be on display in Hall 4.2. OGA S TEAM Emma Alftan, Rights Director (Fiction, Non-Fiction, TV / Film / Licensing Rights) Katja Kaulio, Foreign Rights Manager (Children s books, Young Adults, Comics) Teuvo Sankila, Director of Publishing for Learning Materials Noora Sällström, Foreign Rights Assistant (Fiction, Non-Fiction) Milla Palovaara, Producer (Playwrights) * Granta is a literary magazine whose mission centres on its belief in the power and urgency of the story, both in fiction and non-fiction, and the story s supreme ability to describe, illuminate and make real. Granta was founded in 1889 by students at Cambridge University. OTAVA GROUP 9

10 >> REVIEW BY THE CHAIRMAN OF THE BOARD 2013 EXCEPTIONALLY strong pressure for change was placed on publishers of printed media during the year under review. Increasingly, reading takes place in a digital environment, and consumers want content in digital format. The profitability of publishing companies has been based on the sales of printed products, which advertising sales support with regard to results. With printed products and advertisement sales on the decline, sales growth must be sought through new business concepts. Adjusting to the new situation has been difficult. With the decline of sales revenue, the structure of operations had to be modified and costs cut. For several years, this has meant personnel reductions and other difficult adjustment measures. The adjustment measures have been hard for our personnel. Working communities that are spiritually strong come through adjustment measures better than others. Mental strength in a working community is based on common goals and mutual trust. At Otava Group, the personnel s feeling of togetherness, which the cover of this Annual Report depicts well, along with commitment to the Group s goals, have helped in adjusting to the changes. As yet, it has not been possible to compensate for the drop in the sales of printed media with digital content production. Investments in the future are, however, inevitable, even though they are known to hurt short-term profitability. The digital modernisation of Suomen Kuvalehti and the Lue Kirja ( Read a Book ) service are examples of the Group s digital investments. Otava Group achieved an excellent result in The Group s EBITA (EUR 32.4 million) and profit for the financial year (EUR 22.0 million) rose to a record level despite the 4% decline in net sales. At the same time, the Group s equity ratio rose to 72.8%. This good performance was based on a correct outlook on media industry trends and timely adjustment measures. In the near future, the aim is to create profitable growth by utilising the Group s strong financial position in corporate acquisitions. Otava Group s good performance must be considered particularly significant at a time when the net sales and results of the majority of media companies have been declining dramatically. I have now worked at Otava for 51 years. For over 40 years of this time, I have been in a responsible position as the Managing Director and Chairman of the Board of Directors. I am very grateful for the years I have spent at Otava. In spring 2014, as I reach a milestone birthday, the time has come for a change of the guard. The new Chairman of the Board of Directors will start in his position after the Annual General Meeting that will be held on 25 March I will, however, continue to work for the Otava Group as long as I have the strength. Otava s personnel and owners are committed to publishing. Our shared passion is to create high-quality content and develop new opportunities for reading. Reading is at the very foundation of our well-being. We at Otava Group believe in this and look to the future with confidence. Olli Reenpää chairman of the board 10

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12 Board of Directors

13 Review by the Board of Directors BUSINESS ENVIRONMENT. The downturn that started with the debt crisis of governments in the euro zone continued and the situation of the Finnish national economy weakened. General economic uncertainty increased towards the year s end. GDP decreased by nearly 1% in annual terms. There are some signs of growth in exports, but there are none of economic growth. Unemployment increased to a rate of about 8% by the end of the year, according to Statistics Finland. Interest rates and inflation remained low. Investment levels have been low since the 2008 financial crisis. According to advance data, retail revenues decreased by 1% at an annual level, and Christmas sales also decreased for the first time in decades. Online sales continued to grow, accounting for 7 8% of all retail sales. However, nearly half of online orders are placed with foreign online stores. The trend in the communications sector followed that of the economy in general. Book sales in general literature were down on the previous year. According to advance data, media sales fell by 18% at an annual level and magazine media by nearly 17%. Magazine sales dropped with the decrease in circulations, and it has become increasingly difficult to sell magazines to new customers. Online business continued to increase its share of the communications sector, but growth slowed down. There is now a market in Finland for digital magazines and books, but their share of the overall market is still small. BUSINESS TRENDS IN THE GROUP. Otava Group s net sales decreased by 4%. Otava Group s business result for the year was extremely competitive in view of the general economic situation. The result and relative profitability remained good due to timely enhancement and adjustment measures as well as the changes in the Group s operating procedures. KEY FIGURES Group Net sales, EUR million EBITA, EUR million Return on investment (ROI) % Return on equity (ROE) % Equity ratio % GROUP ORGANISATION AND STRUCTURE. By and large, the Group s organisation and structure remained unchanged. Pekka Harju was appointed Managing Director of Otavamedia Ltd from 1 January Alexander Lindholm continues as the President and CEO of the parent company of Otava Group. BOOKS. Net sales totalled EUR 55.5 (58.4) million, down by 5%. EBITA was EUR 6.3 (8.9) million, or 11.3% (15.1%) of net sales. Even though the result of Otava Publishing Company was down on the previous year, it was still good, and the company increased its market share in general literature. The net sales of Otava Book Printing Ltd decreased and the result weakened as a result of the decreased volume. Like Publishing Ltd s net sales decreased and the result weakened from the previous year. TRADE. Suomalainen Kirjakauppa Oy s net sales came to EUR (106.5) million, down 0.2% (1.0%). EBITA improved considerably from the previous year. The amount of inventories was down by EUR 1.3 million from the previous year. During the year under review, the number of revamped concept stores increased to 24, and the company increased its market share in book sales. MAGAZINES. The magazine division s net sales totalled EUR (154.6) million, down 7% (5%). Magazine subscription sales fell from the previous year. Media sales also decreased, but the group increased its market share substantially in the magazine advertising market. EBITA came to EUR 18.7 (16.8) million, or 13.0% (10.9%) of net sales. The improvement in the result was due to measures that enhanced the efficiency of operations, as well as to restructuring measures. The book club business recorded a good result. The result of Otavamedia Ltd improved and the company posted a good result. The net sales of Suomen Golfpiste Oy increased and the result improved. DeCo Media Oy s business environment was difficult and the company made a loss. The net sales of the Estonian subsidiary Ühinenud Ajakirjad AS remained at the previous year s level and the company remained profitable. NEW BUSINESS FUNCTIONS. New Business Functions comprise NettiX Oy, Ampparit Oy and the Plaza portal. OTAVA GROUP 13

14 >> REVIEW BY THE BOARD OF DIRECTORS The figures for Ampparit Oy are included in the consolidated financial statements from 1 May The business area continued to grow briskly (+12%) and its profitability remained high. BALANCE SHEET, INVESTMENTS AND FINANCIAL POSITION. In 2013, no material changes took place in the balance sheet structure or the balance sheet total. The Group s equity ratio improved, totalling 72.8% (64.8%) at year-end. The Group s gross capital expenditure was EUR 13.5 (10.4) million. The most significant investment was the purchase of the rented plots of Otavamedia Ltd s office properties from the City of Helsinki. In addition, investments were made in revamping stores and in software. The Group s financial position and liquidity remained good. In addition to accounts with credit facilities, the Group s liquidity has been secured using short-term credit limits. The consolidated cash flow from operations was EUR 32.1 (26.4) million. Net financial expenses were EUR 0.5 (0.9) million, representing 0.2% (0.3%) of net sales. RISKS. The Group has a well-established position in the book and magazine markets, which have remained relatively stable year on year. Annual estimates of the Group s overall book sales have not differed significantly from actual sales figures. The Group s companies use a time-based, title-specific obsolescence procedure, which keeps the risk of obsolete book stocks very low. The Group s magazine subscribers are long-term customers, who mainly pay for their subscriptions in advance. As a rule, agreements in the customer magazine market are made for at least twelve months. Fluctuations in the media sales market may be bigger, but the sector accounts for a smaller share of net sales than magazine sales. The price trend of goods and services needed by the Group is easy to predict. The Group has signed long-term agreements to make provisions for paper price fluctuations. Since sales growth in print products is decreasing and no change in this regard can be foreseen, the Group has invested in digital businesses related to its core operations in order to secure growth. Based on the above, the risks related to the Group s operations are minor. A strong cash flow and high equity ratio secure the continuity of the Group s operations in the case of market disturbances or other risk situations. Risks have also been hedged with property and business interruption insurance policies. RESOLUTIONS OF THE GENERAL MEETINGS. The Annual General Meeting held on 14 March 2013 elected Olli Reenpää, Henrik Ehrnrooth, Jorma Ollila, Eero Broman, Heikki Lehtonen and Alexander Lindholm as members of the Board of Directors. Pasi Vainio, Minna Castrén, Timo Kopra and Pekka Harju were elected as deputy members. Ora Lyytikäinen served as Secretary of the Board. Kari Miettinen, Authorised Public Accountant, was re-elected as chief auditor, and Oy Audicon Ab, Authorised Public Accountants, as deputy auditor. The Annual General Meeting decided to distribute a dividend of EUR 3.25 per share, or EUR 6.3 million in total. Furthermore, the Annual General Meeting decided to authorise the Board to repurchase company shares representing up to 15% of the total stock with non-restricted equity. The authorisation is valid until the following Annual General Meeting. An Extraordinary General Meeting was held on 14 November The Annual General Meeting decided on a directed share issue to the members of the Group s management team. The number of shares subscribed and paid for at the redemption value approved by the Annual General Meeting was 14,700. The increase in the share capital was entered in the Trade Register on 26 November SHARES. The company has 1,945,085 shares. The shares have no nominal value. Each share entitles the holder to one vote at the shareholders meeting. The transfer of shares is subject to a redemption clause in the Articles of Association. During the financial year, the company repurchased and cancelled a total of 14,700 shares in accordance with the authorisation granted by the Annual General Meeting on 14 March The purchase price of the shares was the redemption value approved by the Annual General Meeting. PERSONNEL. In the reporting year, the Group s personnel numbers were as follows: Group End of period 1,232 1,297 1,400 Average 1,178 1,249 1,010 OUTLOOK FOR Otava Group expects 2014 to be another challenging year. No positive signs can yet be seen in the Finnish economy, and therefore the business environment will remain challenging. Magazine subscription sales, which account for a significant proportion of the Group s net sales and results, have become increasingly difficult. It is difficult to increase net sales in the print media sector in general. New business functions must be developed, even though the sales volumes of digital books and magazines have been small and the growth of sales slower than expected. Enhancement measures and new procedures will help to maintain the Group s result at the current good level. 14

15 CONSOLIDATED INCOME STATEMENT M NET SALES Increase (+), decrease (-) in inventories of finished goods Production for own use Other operating income Materials and services Personnel expenses Depreciation and value adjustments Other operating expenses Share of result in associated companies OPERATING PROFIT Financial income and expenses ,9 PROFIT BEFORE TAXES AND MINORITY INTEREST Income taxes Minority interest PROFIT FOR THE FINANCIAL YEAR CONSOLIDATED CASH FLOW STATEMENT M Cash flow from business operations Investments Cash flow before financing Financing Changes in liquid assets Liquid assets at 1 January Liquid assets at 31 December OTAVA GROUP 15

16 CONSOLIDATED BALANCE SHEET 31 DEC. M Assets NON-CURRENT ASSETS Intangible assets Tangible assets Long-term financial assets Total non-current assets CURRENT ASSETS Inventories Short-term receivables Cash and bank balances Total current assets TOTAL ASSETS Equity and liabilities SHAREHOLDERS EQUITY Share capital Premium fund Reserve for invested non-restricted equity Retained earnings Profit for the financial year Total shareholders equity Minority interest LIABILITIES Long-term liabilities Current liabilities Total liabilities TOTAL EQUITY AND LIABILITIES

17 Auditor s Report TO THE ANNUAL GENERAL MEETING OF OTAVA LTD. I have audited the accounting records, the financial statements, the report of the Board of Directors and the administration of Otava Ltd for the year ended 31 December The financial statements comprise the consolidated balance sheet, income statement and cash flow statement and notes to the consolidated financial statements, as well as the parent company s balance sheet, income statement, cash flow statement and notes to the financial statements. RESPONSIBILITY OF THE BOARD OF DIRECTORS AND THE MANAGING DIRECTOR. The Board of Directors and the Managing Director are responsible for the preparation of financial statements and report of the Board of Directors that give a true and fair view in accordance with the laws and regulations governing the preparation of the financial statements and the report of the Board of Directors in Finland. The Board of Directors is responsible for the appropriate arrangement of the control of the company s accounts and finances, and the Managing Director shall see to it that the accounts of the company are in compliance with the law and that its financial affairs have been arranged in a reliable manner. AUDITOR S RESPONSIBILITY. My responsibility is to express an opinion on the financial statements, on the consolidated financial statements and on the report of the Board of Directors based on my audit. The Auditing Act requires that I comply with the requirements of professional ethics. I conducted my audit in accordance with good auditing practise in Finland. Good auditing practice requires that I plan and perform the audit to obtain reasonable assurance about whether the financial statements and the report of the Board of Directors are free from material misstatement, and whether the members of the Board of Directors of the parent company or the Managing Director are guilty of an act or negligence which may result in liability in damages towards the company or have violated the Limited Liability Companies Act or the articles of association of the company. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements and the report of the Board of Directors. The procedures selected depend on the auditor s judgement, including the assessment of the risks of material misstatement, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity s preparation of financial statements and report of the Board of Directors that give a true and fair view 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 company s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements and the report of the Board of Directors. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. OPINION. In my opinion, the financial statements and the report of the Board of Directors give a true and fair view of both the consolidated and the parent company s financial performance and financial position in accordance with the laws and regulations governing the preparation of the financial statements and the report of the Board of Directors in Finland. The information in the report of the Board of Directors is consistent with the information in the financial statements. Helsinki, 26 February 2014 Kari Miettinen, APA OTAVA GROUP 17

18 Organisation on 1 January 2014 Working Committee Olli Reenpää, Chairman Henrik Ehrnrooth Eero Broman Alexander Lindholm Pasi Vainio Timo Kopra Pekka Harju Ora Lyytikäinen, Secretary Board of Directors Olli Reenpää, Chairman Otava Ltd Alexander Lindholm, CEO* Finance and Administration Ora Lyytikäinen, CFO* Information Administration Maarit Laakkonen, CIO Books Pasi Vainio* Trade Timo Kopra* Magazines Pekka Harju* New Business Functions Jaakko Haapakangas Otava Publishing Company Ltd Pasi Vainio Managing Director General Literature Minna Castrén Educational Materials Teuvo Sankila Marketing Maija Kuusi Financial Administration Arto Tuokko Communications Liisa Riekki Like Publishing Ltd Päivi Paappanen Otava Book Printing Ltd Matti Uuttu Managing Director Suomalainen Kirjakauppa Oy Timo Kopra Managing Director Sourcing Reetta-Liisa Pikkola Sales Mervi Jäntti Finance and Administration Pirjo Hämäläinen Otavamedia Ltd Pekka Harju Managing Director Publishing Unit 1 Katriina Kaarre Publishing Unit 2 Tarja Hurme Customer Communications Eija Saario Consumer Sales & Marketing Eija Männistö, Markus Rouhiainen Media Sales Tomi Takanen Finance Antti Lahtinen Customer Service & Personnel Anne Mantila Graphig Design Päivi Laakso Image Production Jukka Kaivola Plaza.fi Jaakko Haapakangas NettiX Oy Veli-Matti Vänninmaja Ampparit Oy Petteri Hannonen Managing Director DeCo Media Oy Tomi Takanen Suomen Golfpiste Oy Sami Markkanen Managing Director Suomen Kuvapalvelu Oy Jukka Kaivola Managing Director Ühinenud Ajakirjad AS Marko Tamme Managing Director * Member of the Group Management Team 18

19 Corporate Responsibility IN 2013 Otava Group continued to actively develop its corporate responsibility policy. The Group also launched its dedicated corporate responsibility website. The new Ota vastuu ( Take responsibility ) website presents information related to the Group s corporate responsibility. The website enables us to more visually communicate the realisation of social responsibility within our Group as well as to share perspectives on sustainable development with our readers and in a wider societal context. SOCIETY Throughout our history, our operations have been guided by systematic Finnish language publishing as well as fostering the Finnish culture and language. Otava Group s values responsibility, quality, courage, and closeness communicate the responsibility of a publisher to its readers as well as to society in general. Otava Group wants its operations to contribute to the Finnish economy. The policy guiding the Group s procurement states that in an otherwise equal situation, preference is given to a Finnish, family-owned supplier that takes good care of its environmental responsibilities. All our magazines bear the Key Flag issued by the Association for Finnish Work. In 2013, we also continued the Lukeminen on pääasia ( Reading matters ) campaign, which was implemented in cooperation with Otava Publishing Company and Koululainen magazine. The campaign, which targets primary school pupils, aims to promote reading. It began in August and culminated in November when Finland s fairest class visited Otava. Otava s Book Foundation granted seven literature awards and 406 grants. One of the most traditional of the Group s charity recipients is Kotilieden Kummikerho ry, a sponsorship society founded in Otava Group has cooperated with Pelastakaa Lapset ry (Save the Children Finland) for over 15 years. In 2013, the Group also supported the Uusi lastensairaala 2017 ( New Children s Hospital 2017 ) project. ENVIRONMENT As a family business, Otava Group aims to take care of the company and the environment in such a way that they will be handed over to future generations in good condition. The key elements of our environmental responsibility are: Good management of environmental issues in our own offices and daily work Paper consumption and procurement Energy efficiency of our products Paper consumption in office printing has been decreased thanks to printing optimisation. Office paper is sorted and recycled. Printer toner is recyclable and there is a central system for recycling workstations that are becoming obsolete. In 2013, approximately 12,600 tonnes of paper were used in Otava Group s printed products, the majority of which have the well-known eco-label Joutsenmerkki. The system for monitoring the origin of the paper used by Otava Book Printing has been certified in accordance with the FSC and PEFC standards. The books manufactured by Otava Book Printing have the right to use the Joutsenmerkki label. We systematically measure and monitor energy consumption and strive to continuously improve our energy efficiency. The electricity we use is produced by water power. Of the energy used by the Group, renewable energy accounted for 66.6% in 2013 (65.8% in 2012). GROUP ENERGY AND WATER CONSUMPTION, : OFFICES PRINTING HOUSE ECONOMY ELECTRICITY MWh/year HEAT MWh/year WATER m 3 /year , 239 4, , ,358 4, , , 455 5, ,449 ELECTRICITY MWh/year HEAT MWh/year WATER m 3 /year ,665 1,493 2, ,853 1, , ,874 1,533 3,522 The basis for Otava Group s economic responsibility is profitable business, which guarantees continuity and secures investments and jobs. The principles guiding our business operations are stability and creation of financial wellbeing across generations. As a family business, we are not simply pursuing fast profits. The aim of our strategy is to be successful in the long term. THE FINANCIAL BENEFIT CREATED BY OTAVA GROUP S OPERATIONS FOR VARIOUS STAKEHOLDERS: 2013 ( thousand) Income; net sales, other operating income 305,477 Suppliers of goods and services; goods, materials and services purchased, other operating income, investments 2 1 5,1 2 5 Added value created 90,352 DISTRIBUTION OF ADDED VALUE: Personnel; salaries, fees, social expenses 64,206 Creditors; net financial income/expense 543 Owners; dividend 6,333 Public sector; income, real estate and lottery taxes 7,763 Retained for business development 11,507 OTAVA GROUP 19

20 Contacts Parent company Otava Ltd P.O. Box 134 FI Helsinki, Finland Address: Uudenmaankatu 10 FI Helsinki, Finland Tel firstname.lastname@otavakonserni.fi Books Otava Publishing Company Ltd P.O. Box 134 FI Helsinki, Finland Address: Uudenmaankatu 10 FI Helsinki, Finland Tel firstname.lastname@otava.fi Like Publishing Ltd P.O. Box 37 FI Helsinki, Finland Address: Uudenmaankatu 10 FI Helsinki, Finland Tel firstname.lastname@like.fi Otava Book Printing Ltd Otavantie 11 FI Keuruu, Finland Tel Sales and Marketing: Uudenmaankatu 8 FI Helsinki, Finland Tel firstname.lastname@otavankirjapaino.fi Trade Suomalainen Kirjakauppa Oy Maistraatinportti 1 FI Helsinki, Finland Tel firstname.lastname@suomalainen.com Magazines Otavamedia Ltd Maistraatinportti 1 FI Otavamedia, Finland Tel firstname.lastname@otavamedia.fi Otavamedia Ltd, Customer Communication Maistraatinportti 1 FI Otavamedia, Finland Tel firstname.lastname@otavamedia.fi Kristiinankatu 3 B FI Turku, Finland Tel firstname.lastname@otavamedia.fi Otavamedia Ltd, The Great Finnish Book Club Maistraatinportti 1 FI Otavamedia, Finland Tel firstname.lastname@otavamedia.fi DeCo Media Oy Maistraatinportti 1 FI Helsinki, Finland Tel firstname.lastname@decomedia.fi info@decomedia.fi Suomen Golfpiste Oy Esterinportti 1 FI Helsinki, Finland Tel firstname.lastname@golfpiste.com Finnish Press Agency Ltd Maistraatinportti 1 FI Helsinki, Finland Tel firstname.lastname@kuvapalvelu.com Ühinenud Ajakirjad AS Liivalaia 13/15 EE Tallinn, Estonia Tel ajakirjad@ajakirjad.ee New Business Functions NettiX Oy Esterinportti 1 FI Helsinki, Finland Tel asiakaspalvelu@nettix.fi Ampparit Oy P.O. Box 6 FI Joensuu, Finland Address: Kauppakatu 25 C FI Joensuu, Finland Tel ampparit@ampparit.com Otavamedia Ltd, Plaza.fi Esterinportti 1 FI Otavamedia, Finland Tel firstname.lastname@otavamedia.fi Plaza.fi ANNUAL REPORT 2013 Production Laura Sareskoski Otavamedia Ltd, Customer Communication Layout Petra Antila Cover photo Pekka Holmström Translations Lionbridge Ltd Reproduction Aste Helsinki Oy Printed by Otava Book Printing Ltd