TX Group AG (TXGN) Earnings Call Transcript & Summary

Ladies and gentlemen, I would like to welcome you to this analyst call in relation to TX Group's annual results. These results will be presented to you in detail in a moment by our CFO, Sandro Macciacchini, followed by the directors of the different companies, in order of TX Markets, Goldbach, Tamedia, 20 Minuten and Ventures. They will discuss the company's vision and the key events of the past year and the perspective of 2021. You will be able to ask questions directly after each speaker following the procedure indicated in the invitation to this conference. To begin this call, I give the word to Pietro Supino, Chairman and Publisher of TX Group. Please, Pietro.

Hello, everybody. This is Pietro Supino speaking. I hope that you can hear me, and welcome to our analyst call. The year 2020 has been difficult and challenging for us, both operationally and financially. As a diversified media group and operator of popular platforms, we are close to the pulse of society and obviously affected by what's going on. So we have been affected by the corona crisis mainly, but luckily not only in a negative way. At the same time, I'm proud to report that many positive developments in various fields of our diversified activities have been possible. And I would like to invite afterwards, the general managers of our enterprises to give short presentations. What they stand for, how their segments did in 2020 and what they are working on currently. In addition to the ongoing challenges, we have been busy last year with the implementation of our new decentralized structure of the group. This has worked very well. We are at a good point already, and it is important because it will help us, we are convinced, to shape our future. We did implement this new decentralized organization because over the last 20 years, we have encountered many challenges in our traditional fields of activities. And at the same time, we have found many opportunities, of which luckily we have been able to grasp some and to build new businesses. And by doing that to diversify our portfolio. That then, again, has led to a relatively high complexity of our organization, and it has become more and more difficult to understand and to explain what we stand for. For that reason, we have developed our new decentralized organization that allows to develop the different activities on the basis of their products, and close to their markets. And we are convinced that by doing that, we are in a very good position to confront the ongoing challenges that we encounter at the market and we are also more agile, we are convinced, to adapt to changing circumstances. Overall, I'm impressed by the performance of my colleagues, both in the central services and in the various activities. And I would like to let them now report for each activity. And at the end, for the group, how we have been doing and what we are working on. And after that, we'll be at your disposal for questions. But for any specific questions regarding the various activities, we propose to discuss them directly after the presentations that will now follow my short introduction. Thank you, and speak to you later.

Thank you, Pietro Supino. We will take, as you said, questions about TX Group at the end of the call. And I give the word to Sandro Macciacchini, CFO of TX Group.

Thank you. I hope you can hear me well, too. Good morning, everybody. I would like to start with an overview of the financial key figures for the year 2020 on Slide 6 of the presentation I hope you have in front of you. On the far left, you see that revenues were down by 13%. This was mainly due to the decline in the advertising market and the drop in recruiting sector as a result of the coronavirus. In the first half of 2020, the decline was 18%, so we benefited from a notable recovery in the second half of the year. Lower costs compensated for 60% of the decline in revenues, given an adjusted EBIT of CHF 83 million. Bottom line, we report a net loss of minus CHF 95 million. This is largely attributable to an impairment of Tamedia during the first half of the year. In addition, in the second half of the year, we reported losses on the sales of Trendsales and Olmero in the amount of CHF 18.7 million. Thanks to the better performance in the second half of the year, adjusted free cash flow recovered considerably to CHF 94 million for the full year as a whole compared with 0 after the first 6 months. As a reminder, adjusted free cash flow is operating cash flow after investments in facilities or in other words, in CapEx, but before acquisitions, dividends, undertaking on our settlement of liabilities. Overall, net liquidity reduced by CHF 24 million and amounted to CHF 183 million by the end of the year. The next chart shows that the decline in the advertising market accounts for 2/3 of the loss of revenues for the TX Group. The decline in revenue for classifieds and services was 7%, much of which was due to drops, as already mentioned. The revenues from the user market for publishing were largely stable at minus 2% with a total number of subscriptions increasing. A comparison with previous crisis years, on the next chart shows that TX Group demonstrated the sound level of resilience in 2020. Compared with the financial crisis in 2009, we faced a lower decline in revenue and also EBITDA. Also, the decline of the GDP was much higher than in 2009. The next chart shows the organic -- that the organic decline in revenues was also minus 13%. Here included are opposing effects at Ventures. On the one hand, we acquired the majority in Zattoo in 2019. On the other hand, we ended our investments in Starticket and Olmero in 2020. The next chart shows that digital share of revenue continued to increase. In total, 56% of revenues were achieved with digital offerings in the reporting year, with 41% of these coming from non-publishing activities. The digital share in revenues in publishing per se was up at 33% in the advertising market and 26% in the user market. The next chart shows our net results without one-off effect and that means, especially about the disposal losses from the sales of Trendsales and Olmero, and without the impairment on Tamedia. The overall result without these one-off effects is CHF 8 million, and compares with a normalized result in the previous period of CHF 77 million. As already communicated, we were able to conclude proceedings against the sales of Trendsales last week. These proceedings delivered a profit of around CHF 12 million and will be reported as financial gain in 2021. The next chart shows the cash flow statement. As you can see on the left side, cash flow from operating activities before interest and tax declined by CHF 33 million. This led to a cash flow from operating activities of CHF 128 million. Here included is a positive effect of CHF 9 million due to a lower net working capital at the end of the year than at the beginning of 2020. Cash flow from investing activities was down to minus CHF 12 million. Here included are the sale prices for Olmero and Trendsales of around CHF 20 million. Cash flow from financing activities was minus CHF 131 million. Here included are dividends to the shareholders of TX Group of CHF 37 million and to minorities of CHF 42 million. At the end of the period, cash and cash equivalents stood at CHF 276 million. The next chart shows that capital expenditure summed up to CHF 36 million and was CHF 11 million higher than in the previous period. Here included are investments in IT, real estate and so-called retrofits of our printing plant. For the future, we foresee an average of around CHF 25 million OpEx per year. When deducting the CapEx from the cash flow from operating activities, you get what we call the free cash flow adjusted showed at the right end of the slide, that is a free cash flow before acquisitions and disposals. This free cash flow adjusted amounts to CHF 94 million compared to 0 in the first half year report. This shows that the cash flow substantially recovered in the second half of the year. To conclude, a short look at the balance sheet on the next slide. The equity ratio was up to 73% at the end of the reporting period and net liquidity stood CHF 183 million. This also shows that TX Group is, despite the crisis, financially in good health and in a strong position to take advantage of the opportunities the crisis is offering due to the accelerated pace of digitalization. With that, I would like to hand over to my colleagues for their operational reporting. Thanks for your attention.

Thank you, Sandro Macciacchini. I will give the word to Olivier Rihs, CEO of TX Markets. Olivier, go ahead.

Hi, everyone, and welcome at TX Markets. Before we have a look at the numbers, two important things. We have now a new vehicle with TX Markets Limited, where we joined all our big brands, Car For You, Homegate, Tutti, Ricardo and JobCloud together in order to be smarter, better and faster, with this new organization and leverage technology throughout the whole organization. We also established an investment committee. We want to invest also in start-ups and new technology. In order to be also able to integrate them in our platforms. So now we are able to drive the expansions of our activities ahead more quickly. And we aim to invest in innovative and disruptive technologies and business models to strengthen our platforms and also to broaden the portfolio. And always, of course, in the interest of our users of Central, of course, and keeping with our vision, everyday decisions are made simple. You can see all of this information on our new website, tx.markets. Looking at the numbers, you can see that we have a drop of 7% in revenues. The most impact of the COVID was on JobCloud. But if you look at our peers around the world and then also in Europe, we are absolutely in line. So we are not better, but we are not worse than the other one. So I'm really confident there that as soon as the economy will recover with all the investment we did in digital recruitment and in new technologies, that we are ready also to grow again and to come back to the pre-COVID level at JobCloud. Homegate was also impacted in spring, but recovered very fast. So we can see that at the moment, we are, again, on the same level than the pre-COVID, and that's why we are also, there, very happy. The highlight is at Ricardo and Tutti. Ricardo has, at the moment, more than 4 million registered users. This is half of the Swiss population, and we increased also the number of transactions at about 31%. So a fantastic and tremendous trend on secondhand and the economic -- circular economy. Of course, not only that, so we invested also there in people and in technology in order to have the best platform for our customers. And finally, at Car For You, our innovative car platform, together with our partner, AXA. We implemented a new business model in order that the dealers are able to sell cars digitally. And they really appreciated these new services, and that's why now we have 25 -- almost 25% more dealers on the platform than in 2019. But overall, we can be very happy about the development of the platform and the situation at TX Markets. And I think we are absolutely ready for 2021. Looking at 1 or 2 highlights on Page 17. You can see that at Homegate, we have 20% more sessions than in 2019. At Ricardo, as already said, 30% more visits, 31% more transactions. The same at Tutti. So a very healthy situation. The investment we did in technology are now, here, the results of these KPIs growth. Looking forward to 2021. So we have 3 key projects, first of all, within TX Markets. As I already said, we want to strengthen our collaboration in various disciplines, knowledge sharing, best practice sharing also, and have also common technology in order to be faster and better than we did till today. At JobCloud, despite of the difficult situation in 2020, we look very optimistic forward, also at our -- in Austria with Karriere.at, we are invested there. I think the start in 2021 is very good. And through innovative recruitment technology, we are really able to sustain and help the companies in Switzerland and in Austria to find the right people. And last but not least, the investment in start-up and M&A activities in order to sustain our marketplaces with new technologies, with new business models and to be really state-of-the-art, I think it's very important there to be -- to strengthen our portfolio and to strengthen also the know-how we have within the organization. Overall, a good 2020, very happy and very proud of our people. 2021, we are exciting really to grow to -- for further growth. And we had a good start in January and February, and we are absolutely on plan. And that's why I'm absolutely confident that we will exceed our expectation in the future. Thank you very much, and I give now to the next speaker, and I think it's Michi Frank.

Yes. But Olivier first, we're going to have some questions for you. We will take questions after each speaker. To the audience, do you have any questions for Olivier Rihs? And operator, can you explain how to ask questions, please.

[Operator Instructions] Perfect. The first guy is Daniel Bürki from the Zürcher Kantonalbank.

I would have a question on JobCloud. Could you say how much of the sales decline in 2020? And what do you expect for '21? Because unemployment is going up. We might be heading into a recession. If you could elaborate a little bit on JobCloud since it's your most profitable business.

Sure. If you look at the Page 17, you see here the job of -- the number of listed jobs at minus 13%. And this is absolutely on line what we -- let's say, we really lost in revenue last year. So nothing more than the other peers in Europe. If we look at StepStone or if you look at also the trend at Indeed, et cetera, we have exactly the same effect. So we had no churn in customers, absolutely not. They were very happy that we support them during the COVID last year in order that we were very flexible also by the renewals of their packages, et cetera. So I think now everybody is now expecting, of course, of the recovery of the economy. And we already see some improvement, but we are still on the same level than last year. So I think it's all about, let's say, the recovery of the economy because we are ready. And we also see, for example, the digitalization of recruitment. It's -- let's say, it's improving a lot -- above all on the SMEs in Switzerland. So we see more and more companies booking job listings on a digital way with our tool. And this is something that gives us a good perspective also for the future because if people are working on our tools, they will also, let's say, use our whole services.

I can add something on the financial side because this is disclosed in Note 30 of the annual report. We disclosed the major subsidiaries with noncontrolling interests. And you see there that we had a decline on revenues of around CHF 20 million, that is 17%.

Currently, there are no further questions.

Thank you. I give the word now to Michi Frank, CEO of Goldbach. Michi, go ahead.

Hey, everyone. Hi, it's Michi Frank. I'll start on the Page 20 that you see that. And thank you so much that I can present you the key figures for Goldbach in 2020. Goldbach has suffered a sharp decline in print advertising due to the corona crisis. We had a difficult situation, but we still have some highlights to report. I go now to the Page 21. Network marketing was stepped up. Greater relevance in relation to large international companies. Goldbach audience has already integrated the network business of the TX company's 20 Minuten, Tamedia and TX Markets. In addition, there are more than 150 publishers that use Goldbach audience to market their inventory in various network products. This allow access to more than 50 million profiles or over 90% of Swiss Internet users. We've now had a good Q3 and Q4. Even if we lost some market share in TV after a sharp decline in revenue during the first lock down, the TV sales target was extended in Q3 and Q4. However, it was not enough to make up for the campaigns that we lost in the spring. But we are able to win 92 new customers for TV, and that, I think, is a great result for us. Third-party marketing for Goldbach publishing was successful. New national and regional marketing projects were taken on. Example for Switzerland are Freiburger Nachrichten, [ WOZ Die ], Der Bund, Journal De Morges, International Marketing of the [Foreign Language]. The number of titles in third-party marketing rose from 3 to 21 in 2020. In the second half of the year, the revenues of the Sunday papers were up considerably on the previous year. That's for us, a great story. Neo Advertising as our out-of-home digital ad home company in Switzerland. Expansion of the portfolio in 2020 was 2,445 new advertising spaces for sale. Now I go to the Page 22, our most important projects in '21. Replay ad portal. That's really -- by the point 1, it's really important for us. The replay and ad portal base on online technology, a spread that transcends one of the most innovative platforms in the Swiss media market. bringing TV and online advertising formats closer together. Network marketing. As a Swiss digital network, the goal of Goldbach Audience is to achieve the highest quality reach in video, in-stream and out-stream and display. With more than 150 publishers, we now generate 175 million video views per month. Closer cooperations with TX Markets that improve asset quality. We want to offer a Swiss alternative to the major multimedia corporations, means the GAFAs. Cross-media services, point 3. Our marketing is 360-degree and we aim for increased cross-media selling of this range. In this context, we asked our customers what they want. That's a really important point because we are listening to what they say to us. We are, therefore, working on building an online currency across media, video currency, and we are in the [ pre-oaths ] of building a panel to measure KPIs across all media. We are planning 2 large cross-media offers this year. Now the first is starting in the eastern time, and the second biggest is in the Christmas time. You see there are a lot of new information, new ideas, and I'm totally open-minded for '21. We are still in a crisis modus, but the clients work with us. And we see, for the second quarter, really a bigger good results for '21. Thank you so much. That was my verse. Please questions or something.

Thank you, Michi. Do we have any questions for Michi Frank?

[Operator Instructions] Andy Schnyder from zCapital is the next one.

I have a question on the TV. I have a question on the TV market. Have you had good bookings now for H1 that you can report on? And do you see any kind of shift away from TV? Because we've seen that with print in the past, in the crisis, they lost a lot of ad volume, which never came back because people switched to other mediums, mainly the Internet. And do you see or expect some kind of shift happening also in TV now to online or not?

Andy, the good story is really that what I showed you in the quarter 3 and 4. We saw, in 2020, when the crisis a little bit go down, we had no more lockdown that the clients comes back. Because the reach of TV is really still here. That's the first thing. And the second thing, what we see now, still, we have a lockdown. But what we saw and even what we see especially in the Q2 in '21, the clients say, okay, when the lockdown goes back, we're still here and we won't invest a lot of them. And the second thing is really that, that we are building new ideas, new apps for the inventory. It means in the combination, online and TV. That means also the new measurement ID, what we have for the KPIs. And we believe in that the combination, TV and video, that's the future in this target. And we see that this combination goes great. But that's really the one point. And we see one more at the time, TV is still here in the right way.

Okay. Perfect. And then I had a question on the titles you market for other publishers. Is this just part of their business? Or are we just talking about online? Or what are we talking about here?

That's a part of them because that's not an exclusive business. Because our idea was really that after that, the public group was going out of the market. There was nobody here in the interim. I think that's our idea to bring that together. All the publishing business in online, but on, still, in the older -- in the print part also. And the idea is there's really one face to the customer. The clients only speaks with 1 person about the [ ISD ] and about the new stuff for the future. And then we can bring that together, that the clients and the agencies see that we have here one face to the customer, and that's a grand idea what we have. But that's still so, they are running, in the most part, in the region their selves. And for the national part, the combination is in our hands.

Okay. Perfect. I guess that's -- of the CHF 155 million in revenues, that's, today is still a rather small part, but could potentially become much bigger?

I'm totally sure that must be because we have -- I believe in them totally. We have the best content here in Switzerland together. Together, it means we can open them. And that's also the story. We do that together with the other guys too, and we must have a way to go and fight with the guys from the GAFAs. And that's really the story because we have the content, and now we must -- the content bring in the right targets.

And last question on that. Do you get any backlash from the big media agencies because usually, they can help their clients with booking staff all over the country. But if you do that for them, they don't need a media agency anymore, So for that part -- and you become a competitor of the media agency, which wouldn't be that good, I guess, but probably you can comment on that.

Look, that's not our way. We are, in once, the content user house. And we are, as a goal, we are the inventory guys. And that's the reason. That means it comes from the right side, from the content, goes on the left side to the clients, to the media agencies, and that's an ecosystem where we work together. Our idea is, really, to sell our inventory. That's our way, not going in competition with the media agency. That's not our way.

And we have no further questions for now.

Thank you, Michi Frank. Have a nice day. I give the word to Marcel Kohler, CEO of 20 Minuten. Go ahead, Marcel.

Yes. Good morning, everybody. My name is Marcel Kohler, and I will try to give you a short overview about the latest news concerning 20 minutes. If you go on Page 24, you see maybe the most important news in the headline of this first chart. We are in the black despite downturn in advertising revenue and the lack of commuters. We reached a result, EBIT adjusted of CHF 12 million. That's far a ways from CHF 39 million last -- in 2019. But nevertheless, we see it as a confirmation of the strength of the business model of free paper in Switzerland and also in Austria and Luxembourg and Denmark. Difficult times are good times to take decisions and to bring important projects to the ground. That was exactly that, what we made. I want to speak about the development of new distribution channels in the retail sector. In the print, we are under pressure. That was a successful action. And already today, I can announce that we will bring more news concerning our distribution in the freight. In April last year, we launched our new mobile app. We were in 2008, 20 minutes was the first news site that had a mobile app in this country. And in the meantime, in the last 12 years, we had, in the German part of Switzerland, 4.8 million downloads, and in the French part, there were 2.5 million downloads. We had a successful launch of the video campaign with 20 minutes now. We are quite proud about that product. It shows nobody else has something like that. Internally, we speak about it's the mobile target show for young people. Our digital use is on a high level, I will speak about in the next chart. And what was also very important, we established our own video and photo agency while we did that. Because we stopped the 1st of January, our collaboration with SDA and Keystone. And after 10 weeks, I can say, it was a good decision. If you have a look on the -- on Chart 25, I can say we are on an all-time high in the readership, not in the print. We are under pressure. But in the online, we have a strong growth. Maybe I can say some words. So the visit you see the growth of 39%. What's behind these figures? Behind these figures in Switzerland is that we reach -- we get, every month, more than 180 million visits. That means more than 6 million visits per day in this small country. What are our key projects in 2021, you see that on Page 26. First, I want to speak about -- short about the developing of a circle of experts and introduce quality and so on. Tamedia already does that since, I think, about 5 years. And we will do that also with a specific view on free media. A very important project this year is to expand French-speaking Switzerland. Last Monday, we celebrated the 15th birthday of [ 20 Minuten ] in Lausanne and in Geneva. In these 15 years, we reached the #1 position. But nevertheless, we see more potential. That is one of the reasons why we create 20 new jobs. And the second reason is -- that is our answer to the new competition in Lausanne -- in our environment in Lausanne and Geneva. And finally, we believe in our reach model. We have to do everything that we can get or even to grow our reach. And what we are doing is we invest more in the video. In the German part, today, there are about 1/3 of our journalists work for video, and we will also development our audio activities. And an important point, it's not on this chart, but I'm proud to speak about that, yesterday, we announced our new blogging joint venture with another media house. And we see, in the first 24 hours, we had about 1,200 new registrations, which is quite good figures, and we are looking forward also on this process. That's it.

Thank you, Marcel. Do you have any questions for Marcel Kohler?

[Operator Instructions] Okay. Andy Schnyder, again, from zCapital.

Sorry, I had it on mute. So I would have a question on the revenues for the different PC versus mobile versus print. Of course, print revenues have -- are down, no surprise. But can you talk about online revenues and mobile revenues? Have they both been up in 2020?

All in all, the digital revenues were about stable. In the digital, the revenues of the videos that we had a strong growth of about 35%. In the last 4 years, I can give you an example. We have -- in the video, we had about a growth of 400%.

Okay. So its stable versus...

It's the future for your media, yes.

And I'm not sure if you do that calculation, but what's the print business itself? Was that loss-making or just not generating any profits anymore? But -- or was it still profitable but just in a much lower level?

We -- in the last 2 years, we hadn't the figures in print and online. We will do it again in 2021. And what I can say is that ours is a clear profit also in print and I'm quite optimistic that we will reach that. But of course, to be clear, we -- and that's also a good news. We are 100% financed via the advertising market, and we do about -- more than 60% of our income comes via digital. It's -- some years ago, it was 70-30 for print. And today, it's 60-40 for online.

Okay. Perfect. Perfect. And the last question, more a structural one. As I've asked Michi before, crisis can usually also trigger a structural change. And probably you have done the exercise of comparing mobility data in Switzerland versus your number of copies that the people took out of the boxes. And probably you have seen that after the crisis, even though mobility came back in the past few months, the circulation is not same as it was before. Have you seen something like that? Or is it just back to normal with the lower level we have today?

The lower level in the print distribution?

Yes. Print. Print.

Yes, we had -- the most difficult months were March, April and May last year. Then we came back to about 90% in the month of October and November. And of course, the new lockdown, we are suffering last week, we were exactly at the 80% of the distribution in the second week of March 2020. We are at -- on the level of 80%.

Okay. Yes, that's basically where mobility plus/minus is. Yes. Makes sense.

It's -- if you speak about mobility, we -- of course, we are in close contact to the [ SPD ]. And they are not at 80%. That's the news I have. But as I said, we created new distribution channels at the [ REIT ]. And that's the reason because we -- our distribution is higher than the numbers of commuters in the train.

Daniel Bürki is the next questioner from the Zürcher Kantonalbank.

I would have a question on profitability at 20 minutes. You said that you managed to get to go back into the black numbers in the second half, strong -- very strong rebound despite sales did not come back. So did you have some extra measures there? Or how did you manage to improve profitability in the second half so much?

Yes. There are the normal measures. First, we were -- in the sales, we had growth, a strong -- not a growth compared with 2019, but compared with the first half. And of course, that the tradition at 20 minutes, we are -- we have a strong cost focus and we made safeties wherever we could. And we have the growth market and I think it's an important decision we took in 2016. We invest a lot in the -- a big build in the video. I already spoke about 20 minutes now. And it becomes it becomes a substantial part of our revenue and a very substantial part of our digital revenues.

Currently, there are no further questions. [Operator Instructions] No further questions for now.

Thank you, Marcel. I'll give the word now to Marco Boselli and Andreas Schaffner, CEOs of Tamedia. Please, Marco and Andreas, go ahead.

Hi, everybody. This is Marco Boselli speaking first. I'm Co-Managing Director, together with Andreas Schaffner of Tamedia. That's the paid media unit of the TX Group. And please allow me some initial remarks. 2020 was a really challenging year for us, but it was also really exciting. Challenging, of course, as any other media house worldwide, we're strongly hit by the COVID crisis regarding our revenues. And the other thing we had to learn to manage our really complex structure and all the different projects we have towards digital news unit. We had everything out-of-home office mainly, and that was really challenging, but exciting. It was also, because we saw how strong the interest of our users was in high-quality content, we had amazing traffic over the last year. And on the other side, which was really a good point in 2020, that we were able to rise our digital subscriptions. So people are interested in our content, and they ready to pay for it, which we are really happy about. If you allow me to go through the chart, on #28. You see what I was talking about. The revenues dropped significantly in 2020, 14%. And at the end, we were really happy that we managed to be in the black figures at the end with CHF 9 million. But if you see the previous year, it is also quite a dramatic loss of 74%. On the content and the product side, in 2020, we completely changed towards our road to a mobile-first organization, which, for Tamedia is really -- it was a breakthrough. That means that we publish all our content, digital-first. And then towards making newspapers out of it. This is really -- this was a lot of work to get there. But if you see on the next chart, our digital subscriptions evolved in the last year. This is the only way we will work in the future. On the other side, we know that COVID was an exception somehow, we hope, at least. But on the other side, we know that we have structural problems in the paid media sector. We lose yearly in print advertising. We lose also in subscriptions. And for that, we have to confirm that the evolution by a heavy cost-cutting program, which we announced in 2019. We will go down with our costs in the amount of CHF 70 million until at the end 2022, which is about 15% of our overall cost. So the good news I was speaking about. You see them on Page 29. In the graph on the left side, if we talk about subscription numbers, you see we had -- we could gain 3%, which means that we were able to overcompensate the loss of print subscriptions by the growth in digital subscriptions, which you see on the second graph. We grew 43% in digital subscriptions in the year 2020. If we talk about money, you see that this overcompensation in numbers, you don't see that in money. That means we lost 2% in our user market revenue. Of course, the reason is that the net value of a digital subscription is much lower than with the print subscription. And as already mentioned, the advertising market that was really strong hit we had in the last year. We lost 24% in -- mainly in print -- in the print advertising market. Andreas, maybe our key projects for 2021.

Thanks a lot, Marco. This is Andreas Schaffner, Co-Managing Director for Tamedia, together with Marco Boselli. Hi, everybody. So I'm on Slide 13. So as you have seen, there are several challenging situation and developments we've faced in the past. But as well, if we look in the future, so we are focusing on 3 main axis for changing things in the right way. First of all, we are reviewing and adapting the editorial concepts in the teams of the major 2 regions, Zurich and Berne. We try to maintain, and we will maintain our brand diversity in Berne and Zurich, while we increase attractiveness for the readership, and in parallel, realizing synergies within this team. The future of journalism is digital. This is clear and sure. So what are we doing for the digital transformation, what do we invest in this transformation for the future? First of all, we will develop the competencies to increase attractiveness of our content. So it becomes more digital and more interesting for the reader. Then the second investment we do on a [ similar ] project we will work on is how to better market our digital products, how we can reach new readers and bring them to pay for our subscriptions. And then a third step, we have to invest heavily in technology. We need some technology change to be fast enough in this market environment for digital. Concerning print markets, the print market, we consolidated in the last years, several times. We integrated other printing products in our printing plants. This consolidation is largely over, and we now have to ensure that our newspaper will continue to have the lowest unit cost for the future as they had it already in the past. And so we will pay even more attention to synergies between our printing plans. So these are the basic lines of our projects, and we are convinced that with this and with the CHF 70 million, Marco already mentioned, we will create a base for a sustainable future business. And now I hand over to Patrick Matthey.

Thank you, Andreas and Marco. To the audience, do you have any questions for them?

Daniel Bürki is the first one.

It's me again. I would have a question regarding your cost-cutting problem at Tamedia, the CHF 70 million you plan till end of '22. How much of this did you realize already in 2020? And how big are the restructuring costs you expect out of this cost-cutting program? Just to get a flavor a little bit, how much of the CHF 70 million will really flow through to the bottom line?

Maybe I can start, Andreas, and then you can pick up. We don't talk about how much money we already saved in 2020. But what we can say is that a part of this will also come out of the group, which had announced also a restructuring program last year. And we, as a client of the group, we will pay less for the services that come out of the group. This is already quite a big part of those CHF 70 million. And then, of course, the restructuring we announced this year will be in collaborating better in the regions where we have more than one title with this is the region of Zurich and the region of Berne. This is a double million figure. We will save in finding synergies. And in the end, of course, all those CHF 70 million should go in the bottom line, of course.

But -- sorry, you had already some savings in 2020?

Of course, yes.

For sure, it's part of the savings coming from the group costs.

Just to be -- beside on that, we expect that around CHF 8 million comes out of the lower group costs. This is -- there -- this CHF 8 million, again, is part of the CHF 20 million cost-cutting which I announced. And there is an on-road map and this will be completed in 2023. So the calculation, it's done, but it's not the cost-cutting itself. This is to be seen just to make it precise.

Okay. A question about cost for social plans, et cetera. So we -- first of all, we are really sad that we have to reduce a number of employees for the future, but we can't avoid this. And for this reason, we are in negotiation with a partner -- social -- people from the top, which kind of social plan is needed. Until now, we don't have any results. We believe we will be around what we have in the past, perhaps a little bit better. But until we have signed this -- or finalized this negotiation. We can't say anything for its size. This is on one hand. On the other hand, it's a major goal for us is as well to reduce our number of employees by people leaving the company without -- that we have to -- or extend by our -- from our side. So overall cost, we can't give any figure now.

The next question is by Andy Schnyder from zCapital.

I have a few ones. First on the printing facilities. Can you talk about the utilization of the facilities, probably not -- 2020 is probably not the right year to look at, but what do you expect in 2021, where are we at?

The 3 -- all 3 printing centers are 100% occupied during night shift. This is more or less the major reason why that's a printing centers. And during the day shift, we have some reduction of -- how do I call it, of titles since there are -- mainly on [ SonntagsZeitung ]. They reduced the number of issues they do during the week. So -- but the major and the most important part of our revenues is the production during night shift. And there, we are 100% occupied on all 3 plants.

Okay. But that means that with the day shift, no longer being at 100%, I guess, a few years ago, they were also pretty high, probably not 100%, but pretty high. The overall profitability, which was quite good at the printing facilities at one point is rather slightly coming down. And I guess there are a lot of fixed costs. So you can really reduce the costs you have that much with lower volumes, right?

We have -- a big part is our fixed costs. Occupation during day shift in the past -- or for printing centers, occupation during day shift can be 100%, since the market, already, for the night shift, represent 50% of the volume of the market. And the night shift, it's about 5 to 6 hours, will mean the other 18 hours will never have an occupation from 100%. No printing center, newspaper printing center all over in Europe or throughout has 100% occupation during day shift. So what are we doing is, by flexibility of using the human capital personnel, flexibility and to shift plans to worry about -- realize our costs as far we can go. And yes, for the future, we have to think about if -- we need for the next years, for sure, all 3 printing centers to produce during night shift. It's a question we have to answer is, if we stay in all 3 printing centers during day shift as well in production. There, we have a possibility to consolidate and to increase efficiency in the remaining day shift in the other 2 centers. But there is no decision and there is no plan for right now.

Okay. Perfect. And in terms of revenues, this CHF 470 million, how much of that is user market revenue? What percentage? Roughly 60? 60-40? Or where are we at?

It's about CHF 242 million.

CHF 242 million. So -- yes. Roughly 50%. And the...

This is revenue for subscription, Marco?

Yes. Yes. Exactly.

Yes.

Yes. And from the total subscription revenue, this CHF 242 million, how much of that is digital-only? I guess it's still only probably 10%? Or what kind of level are we dealing with about here?

It's about 10%, yes.

10%. Okay. Perfect. And regarding the advertising market revenue. It's, again, a little bit the same question I asked before about the structural shift. In the past, in the printing advertising revenues, they didn't come back after a crisis. Do you expect this revenue to grow, absolute growth in 2021? When you look at your first few months now, are we -- or could we be above the level we had in 2020? Or will it stay on that level, but probably not during the 10% we usually have, but probably just 5% this year? Or what is your expectation there?

The expectations we discussed also, of course, with Goldbach is that it will be -- the structural loss will go on, of course, but we will return on the level before COVID. So we don't -- probably, we don't stand from the...

Okay. So the good assumption then would be, take 2019 level and then minus the probably 15% or 10%, something like that?

10% to 12%, yes. Between 10% to 15%. It depends if it's a national or a regional newspaper, yes.

Just to add on your question regarding the publishing user market revenue and the digital share of it. I don't know if I understand -- I understood the question correctly, but on Slide 10, we disclosed that, that around 26% is digital in this user market revenue. And user market revenue is, by definition, publishing and therefore, Tamedia.

Okay. Currently, there are no further questions.

Thank you, Marco and Andreas.

Could you repeat that sir. I think we didn't hear you. It could be that you're still muted, maybe. Maybe you have to unmute your phone.

I think we're waiting for the moderator, right, to introduce...

This is Pietro speaking, Sam, just take over and run us through Corporate & Ventures.

Okay. Will, do, thank you. So I'll hurry up in order that nobody else is going to miss another call. So I go quickly through the last 3 pages, so we start on Page 33. This is the overall view of corporate, which includes the ventures activities. It's a bit difficult to read the graph because it's like a conglomerate of internal services, HR, finance, controlling, legal as well as ventures activities. And here, I would focus more on the ventures activities. We had a very busy year in ventures this year. We sold a bunch of companies. We sold Starticket, which was a very, very lucky sale in the beginning of the year, if you look back how many events that happened. So we were very lucky that we were able to sell this company. But it was not an opportunistic sale, it was a strategic sale because we said we want to focus on 2 ecosystems. We said 2 in Doodle, and we want to create a new search field with fintech, so we try to aim all our investments in those directions. That's why we sold Starticket. We sold Olmero, the digitization company for the construction industry. And also Renovero the B2C part of Olmero. We've also done 2 new investments this year, one investment did go into Selma, which is a digital advisory for the younger generation who want to invest their first money into stocks, into 3, 8 pillars or whatever it is. Plus, we invested into lend.ch, which is a peer-to-peer lending platform for private people as well as for corporates. This year was particularly busy for the corporate environment because, as you have heard before, we had to go ahead with this internal project named K2 which is a resizing project and then a rebalancing project in the view of the new setup of the group. So we lowered the cost. We had a program to lower the cost roughly to [indiscernible] -- or in millions, it's about CHF 20 million. We are in good progress with this project. As Sandro just mentioned before, this is going to conclude end of '23. So it's a bit of a long-term project, which also includes some investments into IT systems to reduce staff at the end of the day. I switch to Page 34 (sic) [ Page 33 ]. Here, you have a little bit of a highlighting of 2 special situations with Doodle and Zattoo. I would see the 2 companies absolutely as winners of this COVID situation. If you take on the left, Doodle, they were able to increase revenues by 54%, even during that downturn within the very, very strategic subscription module. The ad module suffered. So as you can see on the lower part of the page on Page 34 (sic) [ Page 33 ], there was a reduction of about 22% of overall, like, traffic and what -- the free users that went down 22% because there was simply nothing to be organized in this COVID and home office situation. So we suffered on one side, but at the same time, we focused on the strategic change into this subscription economy. So we were able to produce a nice growth on that, and we plan to double it again next year. I will come back to that on the next slide. With Zattoo, the entertainment company and the streaming company, we had seen fantastic progress also on the side of the B2B market. Here, we have been growing 36% this year. We marked new high levels on basically all business lines within the tool and also the B2C market that the private end users, we were able to grow those subscriptions by 10% over the last 12 months. So we're very pleased with the development of these 2 anchor investments within the Ventures portfolio. And we also are very pleased with the development of our fintech clusters, mainly our Swiss app-based bank, the Neon bank is doing particularly well. You might have seen the numbers growing there from beginning of the year, like 20,000 up to more than 50,000 at the end of the year. If I go and jump on the last page, Page 35 (sic) [ Page 34 ] The key projects, the key things we are working on is certainly to push the organic growth for our anchor investment within the venture department, it's Zattoo and Doodle. We plan to double revenues over the next few years at Zattoo. We plan to double the subscription numbers at Doodle within the next 12 months. So that implies a monthly growth rate of about 6% within the subscription volume of Doodle and we are well on track to get that done. So the midterm aim in the next 12 to 15 months is to reach about 10 million ARR for this new platform that we developed. Second focus point is certainly the TX data platform. This is a whole program, a whole approach to be data-driven. And we use that data to enrich products, to create products. We use it to enrich transactions and to make it easier for the users to transact with us. We make it easy to create a log-in that is customizable for what the user needs are. As you have heard, we just announced yesterday that we started joint venture together with another big media group in Switzerland, plus another bunch of media groups joining us later with that. There, we created a completely new log-in, that has allowed fingerprint log-ins, allows face log in. So it's really, really easy to locking into 20 minutes in the future. Plus, we have a fantastic weapon with the TX data platform for the coming world that is cookie-less, that Google and Apple tries to dominate in terms of privacy wars. And we -- the only way for us is to not rely on third-party cookies, but to rely on first-party data. To have to log ins with those end users, and we're well on track with that as well. Last but not least, we continue our investments in certain areas, mainly -- the main focus will be the fintech area for my side, plus the Classifieds area for Oli Rihs. So we have a shared investment committee that we built up during the beginning of 2021. It's chaired by Romy Schnelle. She is the Managing Director at the High-Tech GF, High-Tech Gründerfond, or Founder from in Germany. So we hired her and she's helping us to structure those deals, and we get the maximum return over the next few years with those early-stage investments that certainly pose positively big risks, but also big opportunities. And we try to be one of those groups who is taking advantage of the market right now. We see that kind of historically, with some of the fluid capital is not coming back as quickly as somebody thought, some people thought in this market. So certainly some opportunities for us here. That's it from my side. Open for questions.

Thank you, Sam. So this is Pietro again. As we are almost running out of time. I hope that these presentations have been insightful for you. You could see that we are really broadly diversified. We are facing challenges, both of structural nature as well as given to the ongoing crisis, but we are really well positioned. I hope you could also appreciate the quality of our management team, and the role of the group is really to help them operate at above-average levels for Switzerland. And I think it's important to note that Switzerland is a small country. Therefore, we face the question of critical mass for each of our businesses, and that's exactly where the group comes in to help our companies to receive corporate services at competitive costs, better than if they would have to do it themselves or on the market. And also to operate at higher levels. Cybersecurity, being a very good example for that and also the data topic that Sam has touched on, and that is certainly one of our main axis of development to enrich the data lake that we have and to drive value out of it for the development of our services and products, for the sale of our services and products and then also for the value we can offer to our advertising clients. Now we have a couple of minutes for questions you might have at the group level.

Okay. We now Andy Schnyder again.

Yes, this is a question for Samuel, but also probably on a group level. Regarding the ventures and the future of new ventures, new investments. That's not me.

I'm sorry, that was some of the speakers.

Okay. So regarding future investments into new ventures. First, so probably, Samuel, I would be interested in the field you are looking at. How's it to be -- how is it to have a Swiss context? And what are the main criterias you look at when you invest in something. And then probably something -- a question for Pietro, regarding the size of the investments, how much firepower do you give to invest in ventures?

So I will start from my side. This is Sam again. So the search fields we defined is the Doodle and Zattoo ecosystem. So here, we mainly want organic growth. We want to drive growth. And if there is a small add-on that is speeding up the growth trajectory, we would look at it. But it has to be through Doodle or through Zattoo. So it's not an open search field. We really focus on these 2 companies. And then we have a third search field that is a bit more broadly defined that is called a fintech ecosystem. Here we have right now a bunch of investments. We have Neon Bank, we have Lend, we have Selma. There's a small investment in Lykke, so is Monito. And at the side of it, we can also mention MoneyPark, where we have a small shareholding. So this is a bunch of companies, and we're looking for early-stage investments, usually. We're looking for ticket CHF 0.5 million to CHF 2 million, CHF 3 million, something like this. It must have a strong connection to Switzerland. So it's either based in Switzerland or it's coming into Switzerland. We can try to structure deals. We help them establish their path into Switzerland. So always a strong connection to Switzerland, and it should be able to leverage the data that we have within our group. So that is often a reason for them to join us or to come to now a little bit, not just the money itself. It's the smart money that we have data, we have take, we have usability experts, we have M&A experts. And we have a bunch of specialists in our group that they often don't have in their small startups because they really try to scale as quickly as possible. So they don't have all these specialists. So we have a very nice ecosystem for that. And maybe the question of how much money we have available, this will go to Pietro.

So as Sam has said, our priority for the entire group is organic growth. We have, as you have seen, positive cash position for accelerating growth overall through acquisitions and that we want to invest mainly in our 4 enterprises. And for the Ventures arm and there, specifically, the early stage investments, the budget we have is CHF 10 million per year.

Okay. Okay. And even in the crisis years such as 2020, you made quite a decent -- quite a good cash flow, free cash flow. And you have low investment. So there is a lot of cash generated. You're not paying a dividend. I can understand that. In the circumstances, you're always in the public eye. So it's probably not a wisest thing to do. But also in the past, you shied away from increasing your dividend payout, I think, I guess. And you could probably answer that. The family is not really interested in a much higher dividend, which could certainly be paid out. So looking at the market, you have already consolidated what can be consolidated. Or correct me if I'm wrong, I don't see any big targets, which could be acquired here in Switzerland anymore. So the cash will pile up. It is piling up, and it will be further pile up. And the ventures are not doing the difference of the CHF 10 million. So what are you going to do with the cash?

So first of all, of course, the family is interested in the dividend. And I suppose, together with all other shareholders. And it is true that we have to be careful in our -- with our dividend policy, given the context we operate in. But it is our clear goal, as I have stated in the editorial, to our annual report to return to levels of dividends we have seen before. Roughly, we have paid out 1/3 of our gains in the past and reinvested 2/3. That amounted to CHF 350 million for the year 2019. And the years before, we were around CHF 450 million. We aim to get back to those levels. And then, of course, we have to review the dividend policy and to see whether we could even go to higher levels. That depends on how well we will now get through that crisis and recover. And also, it depends on how we can master the digital transformation of our businesses. And there, we foresee that we we'll be doing large investments in the future if M&A opportunities will come up as we have done in the past. For example, Ricardo, that has developed very, very well in the last year or JobCloud earlier on. And we believe that the transformation the industry as a whole is going through, will bring up opportunities for an organic growth, for which we are prepared and in which we want to invest our cash. If we will not encounter such opportunities or will not be able to realize them, then, of course, we will distribute the cash in the years to come.

And I see the online investments, but looking at the market besides probably [ Comparis ] I don't see any huge targets, which could really cost a lot, a lot of money here in Switzerland. Or are they fields without -- you don't have to give me names, but are there fields in Switzerland in online platforms, which could be potentially interesting for you?

We have said earlier that we see the main field of growth in the activities of TX Markets. And there, there are bigger potential targets. But as the industry is really going through a transformation and also in Classifieds, there is a lot of innovation and new businesses are being developed that are maybe not in the triple-digit amount of acquisition cost, but in the double digit. We really see quite a large field of potential developments for which we are ready, which we are following and for which we can really imagine to invest part of our cash or even larger amount that than we have in cash. And then there is the other field where we also see a potential for growth that is Goldbach Group. Maybe there, the capital investment would not be as important as in the field of TX Markets. Also the valuations are more modest, but we see a consolidation of the advertisement market and, therefore, also potential for an organic growth in that field.

The next question is by Daniel Bürki, it's the last question.

Another one for me. I saw that you get government subsidies of CHF 3 million in the last year. If I see the decisions of the parliament, this might go up quite significantly. Could you give any guidance how much money we'll get, if possible? And then speaking of guidance, you will have a very easy comparison base in the first half. You didn't get -- give any guidance for '21. If you could still say more or less what are your expectations for the actual year?

So as for public funding, there are 2 different kinds of money flows. One is the so-called, Corona Note: [ Heal, Save ], which is one-off just to help during the crisis and that amounted to about CHF 2 million, a little bit more. And then we already have some advantages from the so-called indirect the price further on. That is a subsidy for the distribution of printed newspapers. And in the political process, there is a project to really significantly enlarge that, help to the distribution of printed newspapers, which, according to our expectations, but the process is still ongoing, could lead to a reduction of our distribution costs of around CHF 20 million per year, which corresponds to about 20% of our total costs for logistics and distribution. And is very, very significant for Tamedia and the development of Tamedia.

And in '21?

Sandro, we don't give really...

Sorry, but you have to repeat that.

I was asking Sandro to comment on that. As you know, we don't give guidance on the financial development. I think currently, it's even more difficult than under normal circumstances, but Sandro will go as far as he can.

Exactly, it's what you're saying. I guess Mr. Bürki expected the answer, but he still tries. But as you said, especially this year, it's even harder to give any guidance. And the best we can say is that we are on a recovery -- path of recovery. And we were to have -- take advantage of the chances this crisis gives us.

Just maybe to help you a little bit, you took out operational cost of CHF 69 million in 2020, which is significant, right? And a big chunk of this should be sustainable. So with a little bit of help from better sales growth, you should see quite a positive shift in your profitability. Is this a sensible assumption?

It's a good ambition.

I share the conclusion.

Okay. This helps me already a lot.

We want to be ambitious. Can I ask one question to you guys? Now we have tried to give you, really, an in-depth view of our different businesses. Was this helpful for you that we had our colleagues, the general managers of the enterprises, presenting their businesses in more depth? Or was it almost too much for you?

Was very helpful.

So we should do that again in the future.

I would love it, yes.

Good. Is that the general opinion of the audience? Maybe technically difficult now to have a conversation. But may I ask you, please let us know by e-mail, a very short e-mail, whether you have appreciated this, whether it was helpful. And if you have any suggestions for upcoming analyst calls. Would be helpful for us to better understand your needs and how we can provide you with pertinent information.

Okay. Do you want to finish this call on this note?

If there are not any more questions. Yes. So if there are no questions, thank you very much for your attention.

Andy Schnyder has another question from zCapital AG.

Good.

Yes, I just wanted to answer your question. So my view, I think it was very helpful. Usually, the more numbers there are tethered to this, but I think we got a good overview. And also strategically, you have so many different playing fields and battles to fight. So it was really interesting to see all that. And it's also always really interesting to get to know the people behind the different businesses. I think that is extremely crucial, my guess is. And this is probably true for the past few years. It's really difficult in the market to make an investment story on Tamedia, which would attract a lot of investor interest. I mean, there are usually a few specialized Swiss funds like ours, which are interested. But outside of that, not much interest. The free float is low and you are fighting this battle against the shrinking print advertising revenues. And this is a hard side, and you're doing a good job. But these 2 factors, the low free float and fighting to stand still, I call that, is not really a sexy story, and hence, the interest is probably not where it could be or should be, yes. But I think it was really helpful, yes. Really good presentation.

I mean these are obviously concerns that we have, too, and we think a lot about it. We are confident that as we go through the transformation, we'll be able to also show the path into the future. And then it will also unlock more fantasy. That is what we believe, what we work on and for what we are confident. And one concern that you have also addressed is the question of complexity. We understand that we are, compared to our size, a relatively complex organization or, let's say, there is quite a lot of complexity under the roof of our group. I think this has also to be seen in the context of the size of our country, which is very small, but it is very rich. And the markets we operate in are extremely attractive compared internationally. And we think we really can benefit from the synergies within the group, both in terms of cost synergies, but mainly in terms of being able to operate at the highest levels compared to the international standards. And that -- this then justifies the fact that we have a relatively high complexity through -- given the diversification of our activities. And the goal of the new group structure is to reduce this complexity by decentralizing. And then, within the operational units, have much less complexity and a very clear focus on the value to be created. That is, in essence, the idea behind the new structure.

Sounds promising. I mean, we had many years of shrinking net profits. And in the end, its cash flows and net profit or net profit and the more cash flows that are really counting. And yes. And yes, the development there was a bit difficult, but you're in a difficult field in many ways. So I'm not saying you did a bad job on that. It's just your market that is difficult. At times, it is probably a little bit too difficult for a lot of investors to really look at the field, yes. But more transparency and like you did today. And in the end, hopefully, 1 day also a little bit more free float, we discussed about that in the past, a lot of times, would really help. And one thing you could think about is to attract more interest is just hiring a few banks through the SIX through the stock exchange to do coverage. You can buy that for, I think it's CHF 70,000 and you get 3 bank -- coverage from 3 more banks or 2 more banks. That could also help to attract interest.

Thank you for your advice. We really appreciate. And again, if you have a moment and drop us an e-mail, those who maybe have not now expressed their feedback. And if you have more from your side, please let us know. We are really eager to improve also on the Investor Relations side and to make our story known and to make the share price go up again.

[Operator Instructions]

But also maybe many of you now have time constraints, so we won't -- don't want to hold you too long. Those who have time. We are glad to hear you. Otherwise, again, a short e-mail would also be very helpful.

There's no further caller asking.

Okay. Great. So thank you very, very much again, and looking forward to the next call with you.

Ladies and gentlemen, thank you for your attendance. This call has been concluded. You may disconnect.

Thank you.