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European Directories Group, European Directories Midco S.à r.l. and
European Directories BondCo S.C.A. Interim Report
January-June 2016 31 August 2016
Page | 1
Interim Report January-June 2016
(Comparative 2015 numbers in brackets)
Financial Summary
April-June 2016
- Group revenues are MEUR 68 (MEUR 74, -8% below last year) - Revenues for key business drivers profile services and consumer services declined 10% and 12%
respectively (Q2 2016 vs. Q2 2015) - EBITDA is MEUR 9 (MEUR 10, -16% below last year) - Profit for the period after taxes is MEUR 1 (MEUR -5) - Net cash from operating activities is MEUR 9 (MEUR -1)
January-June 2016
- Group revenues are MEUR 133 (MEUR 145, -8% below last year) - Revenues for key business drivers profile services and consumer services declined 9% and 14%
respectively (Jan-Jun 2016 vs. Jan-Jun 2015) - EBITDA is MEUR 16 (MEUR 18, -11% below last year) - Loss for the period after taxes is MEUR -6 (MEUR -12) - Net cash from operating activities is MEUR 16 (MEUR 5) - Net debt excluding shareholder loans is MEUR 79 (MEUR 78)
Revenues continued to decrease in the second quarter. Due to intensified cost cutting measures, profitability has remained approximately at prior year levels. The Board of Directors and management expect that certain markets for the Group’s products and services will continue to decline. Further, it has been difficult to generate profitable growth in the digital businesses. Board and management are fully aware of these challenges and jointly work towards finding measures to mitigate those risks.
In light of the continuing decline in revenues and EBITDA, the Board decided to conduct a strategic review of the three businesses at the beginning of the year. The Board has recently completed that review and concluded that the market continues to be very challenging and the transition to online sales for all of the three units is difficult. As part of the strategic review, the Board considered a disposal of the Austrian business but, after testing the market, concluded that there was not sufficient interest at an attractive enough level for the Group to pursue.
Page | 2
Key events during the quarter
- On 24 June 2016, the Group (through its 61% owned group company Dogado GmbH) acquired 100 % of the shares and votes in Busymouse Business Systems GmbH, a German company providing hosted exchange and cloud services through more than 700 IT channel partners to German SME customers.
- On 7 June 2016, Thomas Friess, Managing Director of Herold left the company. A management committee made of Martin Kargl and John Goddard has been appointed as Managing Directors of Herold. Martin Kargl will be Speaker of the management committee (CEO).
- On 2 May 2016, Marcus Englert replaced David Anderson on the board of European Directories Midco S.à r.l. As a result, the board of European Directories Midco S.à r.l. consists of the following members: Marcus Englert (Chairman), Hannu Syrjänen, Björn Osterloff, Peder Prahl, Marco Sodi, Fabrice Rota and Sébastien Rimlinger.
- As part of an intra-group restructuring in order to reduce administrative costs and bring the Austrian trading companies under the direct ownership of a Dutch holding company, the European Directories Group has finalised merger proceedings in May 2016 of its 100% owned Austrian subsidiary, Herold Holding GmbH, with a newly incorporated 100% owned Dutch subsidiary, European Directories (DH8) B.V. Both companies are 100% direct subsidiaries of European Directories (DH7) B.V. Neither company conducts any trading business, nor has any employees and the operations of the Dutch and Austrian business are completely unaffected by this matter.
- On 12 April 2016, the Group disposed of its 76.34 % shareholding in Tupalo Internetservices GmbH for a nominal amount. The sale resulted in a minor loss to the Group.
- In June 2016 the Group (through its group company European Directories DH7 B.V.) purchased TEUR 13,048 nominal value of the bonds issued by European Directories Bondco S.C.A. for a consideration of TEUR 6,434.
Events after the end of the period
- There has been no material events after the reporting period.
Page | 3
Report of the Board of Directors*
Revenues
Group net revenue by segment, MEUR
Q2 2016 Q2 2015 Q1-Q2 2016 Q1-Q2 2015 2015 LTM
Fonecta 34 36 66 72 142 135
DTG 16 20 33 39 74 68
Herold 18 18 34 34 79 79
Other 0 0 0 0 0 0
Total Group 68 74 133 145 294 282
Group net revenue by product group, MEUR
Q2 2016 Q2 2015 Q1-Q2 2016 Q1-Q2 2015 2015 LTM
Profile services 24 27 47 52 106 101
Consumer services 16 18 29 34 67 62
New media 20 17 38 34 76 80
Print 6 9 13 18 33 27
Other 3 4 5 6 13 12
Total Group 68 74 133 145 294 282
Product groups: Profile services are mainly internet yellow pages (IYP), Consumer services (only in Finland) are directory assistance and sms data information services, New media is mainly consisting of web presence and marketing services, Print is traditional printed directories and Other consists of mixed revenue streams.
April-June 2016
Group revenues for the second quarter totalled MEUR 68, an 8% decline compared to the previous year due to the continued structural decline of traditional print revenues and Fonecta’s consumer business.
New media revenues, mainly website and marketing services have shown a small improvement, however not overall compensating the decline in traditional business. Profile services revenues totalling MEUR 24 decreased by MEUR 3 mainly due to the terms and conditions change one-off impact in previous period. The total share of online products in the Group’s product portfolio totalled 65% in the quarter.
*) The term Board of Directors is referring to the Board of Managers in European Directories Midco S.à r.l
Page | 4
Print revenues totalled MEUR 6, a decline of 32% compared to previous year. Print revenues represented 9% of total revenues, showing a decrease of 5 percentage points. Consumer services consisting of directory assistance and SMS data information services in Finland declined by 12% and totalled MEUR 16, representing 24% of total revenues.
In addition to the structural decline in traditional print, the transition to online and digital services continues to be challenging in all three markets in which the Group operates due to prevailing economic weakness and strong competition.
January-June 2016
Group revenues for January-June totalled MEUR 133, a MEUR 12 or 8% decline compared to previous year.
New media revenues, mainly website and marketing services have shown an improvement, however not overall compensating the decline in traditional business. Profile services revenues totalling MEUR 47 decreased by MEUR 5 from the previous year due to the divestment of “secondary entries” business unit and the terms and conditions change one-off impact in previous period. The total share of online products in the Group’s product portfolio totalled 64%.
Print revenues totalled MEUR 13, a decline of 30% compared to previous year. Print revenues represented 10% of total revenues, showing a decrease of 2 percentage points. Consumer services consisting of directory assistance and SMS data information services in Finland declined by 14% and totalled MEUR 29, representing 22% of total revenues.
In addition to the structural decline in traditional print, the transition to online and digital services continues to be challenging in all three markets in which the Group operates due to prevailing economic weakness.
Page | 5
Result
Group ebitda by segment, MEUR
Q2 2016 Q2 2015 Q1-Q2 2016 Q1-Q2 2015 2015 LTM
Fonecta 6 6 12 14 29 28
DTG 2 3 5 6 13 12
Herold 2 2 1 0 10 12
Other -1 -1 -3 -2 -5 -6
Total Group 9 10 16 18 48 46
April-June 2016
Group EBITDA for the quarter amounted to MEUR 9 (MEUR 10), with EBITDA margin of 13% (14%). EBITDA in Q2 2015 included a c MEUR 1 positive one-time effect from change in contract terms and conditions in the Netherlands. The decline in high margin traditional business (print and consumer business) also has a negative impact on margin and EBITDA in all countries.
January-June 2016
Group EBITDA for the first six months amounted to MEUR 16 (MEUR 18), with EBITDA margin of 12% (12%). EBITDA in January-June 2015 included a c MEUR 3 positive one-time effect from change in contract terms and conditions in the Netherlands. The decline in high margin traditional business (print and consumer business) also has a negative impact on margin and EBITDA in all countries. Overall, the consumer business continues to be the main contributor of the Group EBITDA, while new media business continues to be challenging.
The Group’s total operating costs and expenses for January-June decreased by MEUR 10, or 11%, compared to the prior year. Other operating expenses have reduced by 20% mainly due to tighter cost management leading to lower third party service expenses and business support costs. Personnel expenses decreased by MEUR 5, or 7%, due to lower employee numbers, while the cost of consumables has remained at last year level due to higher fulfilment costs of the online products.
Operating profit amounted to MEUR 3 (MEUR 2) mainly due to lower depreciation and amortisation, representing an operating margin of 2% (1%).
The net finance costs of the Group decreased by MEUR 4 year-over-year. This decrease is due to the gain recognised on the repurchase of own bonds (MEUR 6) partially offset by accrued interest on the capitalized Shareholder Loan (Preferred Equity Certificate). The shareholder loan interest is not paid and will not lead to cash interest whilst the bond is outstanding.
Page | 6
Balance sheet, cash flow and investment activities
At the end of June 2016, European Directories Group’s consolidated assets totalled MEUR 418 (30.6.2015: MEUR 480). The decrease is mainly attributable to the wind down of the Dutch companies’ cash pool arrangements in December 2015, following which there are no bank overdrafts. Further, amortisation of other intangible assets, in the ordinary course, also contributes to the decrease.
Group cash flow, MEUR
Q2 2016 Q2 2015 Q1-Q2 2016 Q1-Q2 2015 2015 LTM
Ebitda 9 10 16 18 48 46
Gains and losses from sales of fixed assets and other non-cash adjustments
0 0 0 2 0 -2
Net change in working capital 3 -8 6 -10 -27 -11
Net cash from operating activities before financial items and taxes paid
12 2 22 10 21 33
Financial items paid, net -3 -3 -5 -5 -11 -11
Taxes paid 0 0 0 0 -6 -6
Net cash from operating activities 9 -1 16 5 4 16
Net cash used in investing activities -6 -3 -10 5 -6 -21
Net cash used in financing activities -7 0 -7 -1 -2 -8
Net increase/decrease in cash -3 -4 0 9 -4 -13
In January-June 2016, the Group’s net cash from operating activities before financial items and taxes paid increased to MEUR 22 (MEUR 10) and net cash from operating activities increased to MEUR 16 (MEUR 5) due to positive working capital movement. Net cash used in investing activities was MEUR -10 (MEUR 5), representing acquisitions made and capital expenditure on customer products and services. The positive investing cash flow in the previous year was driven by the divestment of the business unit “secondary entries” by Herold (MEUR 10) and the divestment of the Swedish partnership, HB Förlaget (MEUR 1). Net cash used in financing activities was MEUR -7 (MEUR -1) mostly driven by the repurchase of own bonds made in June 2016.
The cash balance of the Group at the end of June 2016 was MEUR 46 (30.6.2015: MEUR 60).
Investments in tangible and intangible assets
In January-June 2016, investments in tangible and intangible assets amounted to MEUR 6 (MEUR 6). Investments were mainly related to growing the online business offering and customer service capabilities.
Acquisitions
In January 2016, the Group acquired 100% of the shares in DR3DATA. The acquisition price of MEUR 0.8 was paid by way of a capital contribution to DR3DATA.
Page | 7
In January 2016, the Group (through its group company Dogado GmbH) acquired 100% of the shares and votes in Media Webline AG. The acquisition price was MEUR 1.9, creating a goodwill of MEUR 0.9.
In March 2016, the Group acquired an additional 10 % interest in its group company Dogado GmbH, increasing its ownership from 51 % into 61 %. The additional capital of MEUR 1 will be used for further acquisitions to increase the group webhosting base.
In June 2016, the Group (through its 61% owned group company Dogado GmbH) acquired 100% of the shares and votes in Busymouse Business Systems GmbH. The acquisition price was MEUR 2. The acquisition created a goodwill of MEUR 1.3.
In June 2016, the Group (through its 61% owned group company Dogado GmbH) acquired Canhost business. The acquisition price was MEUR 0.4.
Divestments
In April 2016, the Group disposed of its 76,34% shareholding in Tupalo Internetservices GmbH for a nominal amount. The sale resulted in a minor loss to the Group.
Interest-bearing net debt
Net interest-bearing debt at 30 June 2016 was MEUR 79, excluding subordinated shareholder loans (compared to MEUR 78 at the end of June 2015).
In June 2016 European Directories DH7 B.V. (European Directories’ group company) purchased TEUR 13,048 nominal value of the bonds for a consideration of TEUR 6,434. The purchase resulted in a reduction of the carrying value of the bonds of TEUR 12,787 and gain of TEUR 6,352, which was recognised in other financial income. The amortised cost of the bond as of 30 June 2016 was TEUR 125,639.
Personnel
At the end of June 2016, the number of Group employees (FTE) was 1,648, a decrease of 256 (FTE) compared to end of June 2015.
Composition of the Board of Directors
The board of European Directories Midco S.à r.l. consists of the following members: Marcus Englert (Chairman), Hannu Syrjänen, Björn Osterloff, Peder Prahl, Marco Sodi, Fabrice Rota and Sébastien Rimlinger.
The board of the general partner of European Directories BondCo S.C.A., European Directories GP S.à r.l. consists of John D. Sutherland, Manager A, Fabrice S. Rota, Manager B and Sébastien Rimlinger, Manager B.
Page | 8
For further information, please contact:
Group CFO Neil Robson e-mail: ir@europeandirectories.com
European Directories Group will publish one further interim report in 2016:
- January-September by 30 November 2016
Interim reports will be released on the European Directories Group web site: www.europeandirectories.com/investors
About European Directories Group
European Directories Group is an online partner for SMEs offering local search and lead generation with a scalable business model. The Group operates through three main brands: Fonecta in Finland, Herold in Austria and DTG in the Netherlands.
The Parent company of the Group is European Directories Midco S.à r.l. in Luxembourg. European Directories BondCo S.C.A., a subsidiary of European Directories Midco S.à r.l., issued senior secured callable floating rate bonds in the amount of MEUR 160 in December 2013 which were listed in December 2014 at Nasdaq Stockholm.
CONTACT INFORMATION
Head quarter of European Directories Group: Herikerbergweg 88 Postbus 77863 1070 LL Amsterdam The Netherlands
European Directories BondCo S.C.A.: 46A, Avenue J.F. Kennedy L-1855 Luxembourg The Grand Duchy of Luxembourg
European Directories Group
January-June 2016
Interim Financial Statements are unaudited
1000 EUR Note
Q2
2016
Q2
2015
Q1-Q2
2016
Q1-Q2
2015 2015
Last twelve
months
Revenues 3 68,281 74,046 132,652 144,685 293,917 281,884
Other income 168 263 879 768 1,511 1,622
Cost of consumables -16,467 -15,489 -30,944 -30,312 -60,139 -60,771
Personnel expenses -31,653 -35,510 -63,985 -69,169 -132,514 -127,330
Other operating expenses -11,668 -13,057 -22,827 -28,316 -54,826 -49,337
EBITDA*)
3 8,661 10,253 15,775 17,656 47,949 46,068
Gain/(loss) from sale of subsidiaries -70 -55 -70 -398 -399 -71
Depreciation, amortisation and impairment charges -6,533 -7,687 -12,800 -15,593 -32,741 -29,948
Operating profit/(loss) 2,058 2,511 2,905 1,665 14,809 16,049
Finance income 6,434 36 6,471 105 82 6,448
Finance expense -7,927 -7,446 -15,786 -13,885 -28,050 -29,951
Finance costs - net -1,493 -7,410 -9,315 -13,780 -27,968 -23,503
Profit/(loss) before income tax 565 -4,899 -6,410 -12,115 -13,159 -7,454
Income taxes 171 -160 433 -231 818 1,482
Profit/(loss) for the period 736 -5,059 -5,977 -12,346 -12,341 -5,972
Attributable to:
Owners of the parent 824 -4,996 -5,826 -12,298 -12,095 -5,623
Non-controlling interests -88 -63 -151 -48 -246 -349
736 -5,059 -5,977 -12,346 -12,341 -5,972
Condensed consolidated income statement
*) EBITDA is defined as operating profit/(loss) before depreciation, amortisation and impairment charges and gain/(loss) from
sale of subsidiaries.
9
European Directories Group
January-June 2016
Interim Financial Statements are unaudited
1000 EUR
Q2
2016
Q2
2015
Q1-Q2
2016
Q1-Q2
2015 2015
Last twelve
months
Profit/(loss) for the period 736 -5,059 -5,977 -12,346 -12,341 -5,972
Other comprehensive income
Items that may be reclassified to profit or loss in
subsequent periods
Exchange differences on translating foreign operations 69 -47 211 135 195 271
69 -47 211 135 195 271
Items that will not be reclassified to profit or loss
in subsequent periods
Remeasurements of defined benefit liability -23 -21 -47 -42 17,756 17,751
Related tax 6 6 12 11 0 1
-17 -15 -35 -31 17,756 17,752
Other comprehensive income for the period, net of tax 52 -62 176 104 17,951 18,023
Total comprehensive income for the year 788 -5,121 -5,801 -12,242 5,610 12,051
Total comprehensive income attributable to
Owners of the parent 876 -5,058 -5,650 -12,194 5,856 12,400
Non-controlling interests -88 -63 -151 -48 -246 -349
Total comprehensive income for the year 788 -5,121 -5,801 -12,242 5,610 12,051
Condensed consolidated statement of comprehensive income
10
European Directories Group
January-June 2016
Interim Financial Statements are unaudited
1000 EUR Note
June 30
2016
June 30
2015
Dec 31
2015
ASSETS
Non-current assets
Goodwill 5, 6 216,054 210,500 213,816
Other intangible assets 6 90,785 98,304 93,613
Property, plant and equipment 7 5,102 5,507 5,486
Investments in associates 403 434 403
Available-for-sale financial assets 4 1,471 1,472 1,471
Other financial assets 4 36 35 36
Loan receivables from related parties 4 1,782 1,599 1,731
Deferred tax assets 2,861 3,892 2,837
Total non-current assets 318,494 321,743 319,393
Current assets
Inventories 726 349 712
Trade and other receivables 4 52,323 56,311 59,553
Cash and cash equivalents (excluding bank overdrafts) 4, 8 46,313 101,974 46,705
Total current assets 99,362 158,634 106,970
Total assets 417,856 480,377 426,363
EQUITY
Equity attributable to owners of the parent
Share capital 100 100 100
Share premium 16,449 16,449 16,449
Other reserves 10 10 10
Retained earnings -68,942 -81,075 -63,026
Total -52,383 -64,516 -46,467
Non-controlling interests 985 1,201 1,003
Total equity -51,398 -63,315 -45,464
LIABILITIES
Non-current liabilities
Bond 4, 9 125,639 137,392 138,084
Shareholder loan and accrued interest 4, 9 144,394 126,447 134,781
Other non-current financial liabilities 4, 5, 9 8,680 8,383 8,270
Deferred tax liabilities 47,310 48,279 46,884
Provisions 4,054 4,255 1,930
Pension obligations 13,929 30,107 12,050
Total non-current liabilities 344,006 354,863 341,999
Current liabilities
Trade payables 4 12,279 12,081 12,164
Deferred revenues 56,370 65,779 58,009
Provisions 10 20,603 27,562 21,596
Other current liabilities 4 35,996 40,969 38,059
Bank overdrafts 4 - 42,438 -
Total current liabilities 125,248 188,829 129,828
Total liabilities 469,254 543,692 471,827
Total equity and liabilities 417,856 480,377 426,363
Condensed consolidated balance sheet
11
European Directories Group
January-June 2016
Share
capital
Share
premium
Other
reserves
Retained
earnings
Owners of
the parent
Non-
controlling
interests
Total equity
1000 EUR
Total equity 31 December 2015 100 16,449 10 -63,026 -46,467 1,003 -45,464
Loss for the period - - - -5,826 -5,826 -151 -5,977
Other comprehensive income - - - 176 176 - 176
Total comprehensive income for the period - - - -5,650 -5,650 -151 -5,801
Acquisition of non-controlling interest*) 122 122 -122 0
Capital injection to subsidiary with a non-
controlling interest*)
- - - -389 -389 389 0
Total changes in ownership interests - - - -267 -267 267 0
Dividends to non-controlling interests -135 -135
Total equity 30 June 2016 100 16,449 10 -68,942 -52,383 985 -51,398
Total equity 31 December 2014 100 16,449 10 -60,694 -44,135 429 -43,706
Loss for the period - - - -12,298 -12,298 -48 -12,346
Other comprehensive income - - - 104 104 - 104
Total comprehensive income for the period - - - -12,194 -12,194 -48 -12,242
Put option arising on business combination**)
- - - -8,188 -8,188 0 -8,188
Non-controlling interest arising on business
combination - - - - - 955 955
Dividens to non-controlling interests - - - - - -135 -135
Total equity 30 June 2015 100 16,449 10 -81,075 -64,516 1,201 -63,315
Condensed consolidated statement of changes in total equity
*) In March 2016, the Group acquired an additional 10 % interest in Dogado Gmbh increasing its ownership from 51 % to 61 % in accordance with the
Organisation Agreement entered into on the acquisition of the original 51% shareholding. The non-controlling interest's share decreased from 49 % to 39 %.
The acquisition was made by the issuance of new shares (TEUR 1,000) by Dogado. The Group recognised a decrease in non-controlling interest of TEUR 122
from the acquisition and an increase in non-controlling interest of TEUR 389 from the capital injection. The carrying amount of Dogado's net assets in the
Group's financial statements on the date of the acquisition was TEUR 1,225.
**) The Group has recognised a financial liability for a put option relating to the acquisition of non-controlling interest in Dogado GmbH. The put option entitles
the non-controlling interest of Dogado GmbH to sell their shares to the Group during 2018-2019. See note 5 and 9.
12
European Directories Group
January-June 2016
Q2
2016
Q2
2015
Q1-Q2
2016
Q1-Q2
2015 2015
Last twelve
months
736 -5,059 -5,977 -12,346 -12,341 -5,972
-171 160 -433 231 -818 -1,482
1,493 7,410 9,315 13,780 27,968 23,503
6,533 7,687 12,800 15,593 32,741 29,948
70 55 70 398 399 71
- - 0 1,540 -360 -1,900
58 - 108 53 144 199
-2,666 -2,532 -5,154 -4,975 -9,938 -10,117
-8 29 -5 31 -834 -870
-78 -124 -112 -93 -5,804 -5823
5,967 7,626 10,612 14,212 31,157 27,557
2,869 -8,327 5,883 -9,610 -26,786 -11,293
8,836 -701 16,495 4,602 4,371 16,264
-2,764 - -4,411 - -3,135 -7,546
Purchases of available-for-sale investments 0 - 0 -27 -20 7
-2,688 -3,240 -5,557 -6,216 -14,314 -13,655
-52 -55 -52 983 985 -50
0 - 0 10,000 10,099 99
0 - - - -2 -2
-5,504 -3,295 -10,020 4,740 -6,387 -21,147
3,332 -3,996 6,475 9,342 -2,016 -4,883
- - - - 788 788
-6,434 - -6,434 - -559 -6,993
-36 -50 -247 -348 -1,918 -1,817
-135 -135 -135 -135 -135 -135
-18 -39 -51 -87 -219 -183
-6,623 -224 -6,867 -570 -2,043 -8,340
-3,291 -4,220 -392 8,772 -4,059 -13,223
49,604 63,756 46,705 50,764 50,764 59,536
- - - 0 - 0
46,313 59,536 46,313 59,536 46,705 46,313
1000 EUR
Condensed consolidated cash flow statement
Cash flow from operating activities
Interest received
Gains/losses from sale of fixed assets
Loss for the period
Adjustments for:
Income tax expenses
Finance costs - net
Depreciation, amortisation and impairment charges
Gain/(loss) from sale of subsidiaries
Interest paid
Cash flow from financing activities
Proceeds from long-term liabilities
Payments of long-term liabilities
Proceeds from sales of intangible assets and property, plant and equipment
Other financial items and realised foreign exchange gains
Taxes paid
Operating cash flow before movements in working capital
Net change in working capital
Net cash from operating activities
Cash flow from investing activities
Purchases of intangible assets and property, plant and equipment
Sales of subsidiaries and businesses, net of cash
Acquisitions of subsidiaries and businesses, net of cash acquired
Net cash used in financing activities
Proceeds from other interest-bearing receivables
Net cash used in investing activities
Cash flow before financing activities
Loans granted to related parties
Dividends paid to non-controlling interests
Cash and cash equivalents at the end of period
Net increase (+) / decrease (-) in cash and cash equivalents
Cash and cash equivalents at the beginning of period
Foreign exchange differences in cash and cash equivalents
Payments of short-term liabilities
13
European Directories Group
January-June 2016
Notes to the condensed consolidated interim financial statements
1. Basis of preparation
2. Critical accounting estimates and judgements
These condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard (IAS) 34, Interim
Financial Reporting, as adopted by the EU.
The accounting policies adopted are consistent with those of the previous financial year. In addition, the Group has adopted those new and amended
IFRS standards effective for the financial year ending 31 December 2016, which have been presented in the condensed consolidated financial
statements for the year ended 31 December 2015. Those new and amended IFRS standards have not had any material impact to the interim financial
statements. The interim financial statements are unaudited.
In accordance with the new guidelines on Alternative Performance Measures (APMs) issued by the European Securities and Markets Authority (ESMA)
the Group has reviewed the terminology and measures used in its financial reporting. The Group no longer uses alternative performance measures
referred in the Guidelines to describe its operational and financial performance. Therefore, the Group no longer presents LFL information for "Group net
revenue by segment, MEUR" and "Group ebitda by segment, MEUR". Also "Net debt to EBITDA" measure is no longer presented.
All figures in the consolidated interim financial statements have been rounded and consequently the sum of individual figures may deviate from the sum
presented.
The Board of Directors is the Group's chief operating decision maker. Management has determined the operating segments based on the information
reviewed by the Board of Directors for the purposes of allocating resources and assessing performance.
The Board of Directors considers the business from a geographic perspective in Finland (Fonecta), Austria (Herold) and the Netherlands (DTG).
3. Segment information
The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts
of assets and liabilities, income and expense. Actual results may differ from these estimates.
In preparing these interim financial statements, the significant judgements made by management in applying the Group's accounting policies and the key
sources of estimation uncertainty were the same as those that applied to the consolidated financial statements as at and for the year ended 31
December 2015.
• Fonecta reporting segment consists of print, consumer services, profile services, new media and other
onlineproduct lines in Finland.
• DTG reporting segment consists of print, profile services, new media and other online product lines in the
Netherlands.
• Herold reporting segment consists of print, profile services, new media and other online product lines in Austria.
• "Other" is not a reporting segment, but consists of corporate headquarter costs and corporate financing.
As of 1 April 2016, the Group has changed its reporting structure. An Austrian holding company in Herold was merged with a Dutch holding company in
Other segment. The comparable segment information has not been restated due to the immaterial impact of the change to income statement items. The
impact to balance sheet comes mainly from non-operational items, which include tax related items and intra-group financing between Herold and the
holding companies.
14
European Directories Group
January-June 2016
Revenues by segment
1000 EURQ2
2016
Q2
2015
Q1-Q2
2016
Q1-Q2
2015 2015
Last twelve
months
Fonecta 33,665 36,062 65,620 72,128 141,510 135,002
DTG 16,223 20,228 33,435 38,956 73,643 68,122
Herold 18,393 17,756 33,597 33,601 78,764 78,760
Other - - - - - -
Group total 68,281 74,046 132,652 144,685 293,917 281,884
EBITDA by segment
1000 EUR Q2
2016
Q2
2015
Q1-Q2
2016
Q1-Q2
2015 2015
Last twelve
months
Fonecta 6,353 6,076 12,038 13,517 29,444 27,965
DTG 2,011 3,430 5,305 6,477 13,217 12,045
Herold 1,546 1,917 1,026 -154 10,405 11,585
Other -1,249 -1,170 -2,594 -2,184 -5,117 -5,527
Group total 8,661 10,253 15,775 17,656 47,949 46,068
Capital expenditure by
segment
1000 EURQ2
2016
Q2
2015
Q1-Q2
2016
Q1-Q2
2015 2015
Last twelve
months
Fonecta 628 879 1,048 1,823 3,931 3,156
DTG 800 1,368 2,547 2,929 5,376 4,994
Herold 1,260 993 1,962 1,464 5,007 5,505
Other - - - - - -
Group total 2,688 3,240 5,557 6,216 14,314 13,655
Assets by segment
1000 EUR
June 30
2016
June 30
2015
Dec 31
2015
Fonecta 276,160 275,999 277,482
DTG 92,918 98,819 86,893
Herold 84,303 92,484 140,456
Other -35,525 13,075 -78,468
Total assets in the balance sheet 417,856 480,377 426,363
Liabilities by segment
1000 EUR
Jun 30
2016
Jun 30
2015
Dec 31
2015
Fonecta 162,032 479,998 168,621
DTG 290,565 312,604 283,077
Herold 55,985 199,192 196,424
Other -39,328 -448,102 -176,295
Total liabilities in the balance sheet 469,254 543,692 471,827
EBITDA is calculated by adding back depreciation, amortisation and impairment charges and gain/(loss) from sale of subsidiaries to operating profit/loss.
15
European Directories Group
January-June 2016
1000 EUR
Available for
sale financial
assets
Loans and
receivables
Measured at
amortised cost Total
Assets as per balance sheet
Trade and other receivables - 52,323 - 52,323
Cash and cash equivalents - 46,313 - 46,313
Available-for-sale financial assets 1,471 - - 1,471
Other financial assets - 36 - 36
Loan receivables from related parties - 1,782 - 1,782
Book value total 1,471 100,454 - 101,925
Liabilities as per balance sheet
- - 125,639 125,639
- - 144,394 144,394
Other non-current financial liabilities - - 8,680 8,680
Trade payables - 12,279 - 12,279
Other current liabilities - 35,996 - 35,996
Book value total - 48,275 278,713 326,988
1000 EUR
Available for
sale financial
assets
Loans and
receivables
Measured at
amortised cost Total
Assets as per balance sheet
Trade and other receivables - 59,553 - 59,553
Cash and cash equivalents - 46,705 - 46,705
Available-for-sale financial assets 1,471 - - 1,471
Other financial assets - 36 - 36
Loan receivables from related parties 1,731 1,731
Book value total 1,471 108,025 0 109,496
Liabilities as per balance sheet
Bond - - 138,084 138,084
Shareholder loan - - 134,781 134,781
Other non-current financial liabilities 8,270 8,270
Trade payables - 12,164 - 12,164
Other current liabilities - 38,059 - 38,059
Book value total - 50,223 281,135 331,358
4. Financial risk management
The Group has not made any significant changes in policies regarding risk management during the period. Aspects of the Group's
financial risk management objectives and policies are consistent with those disclosed in the consolidated financial statements for
the year ended 31 December 2015.
The Group has no financial instruments measured at fair value. Available-for-sale financial assets consist of unquoted shares,
which are measured in the Group at their acquisition price in the absence of a reliable fair value.
31 Dec 2015
Classification of financial instruments
30 Jun 2016
Bond
Shareholder loan
16
European Directories Group
January-June 2016
On 24 June 2016 the Group (through its group company Dogado GmbH) acquired 100 % of the shares and votes in Busymouse
Business Systems GmbH. Busymouse Business Systems GmbH is a German company providing hosted exchange and cloud
services through more than 700 IT channel partners to German SME customers. The acquisition price was TEUR 2,018,
creating a goodwill of TEUR 1,274 which is mainly attributable to the synergies expected to be received from integrating the
company into the Group's existing hosting business.The fair values of the acquired net assets have been determined on a
provisional basis, pending completion of the final valuation.
On June 1 2016, the Group (through its group company Dogado GmbH) acquired Canhost business. Canhost is a German
domain and webhosting business. The acquisition price was TEUR 358. The fair values of the acquired net assets have been
determined on a provisional basis, pending completion of the final valuation.
On 22 January 2016, De Telefoongids Holding B.V. (“DTG”), a European Directories Group company, acquired 100% of the
shares in DR3 B.V. (“DR3DATA”). DR3DATA is a Dutch company holding an extensive business-to-business marketing
database with annual turnover of c MEUR 1.5. The final acquisition price was TEUR 800 and was paid by way of a capital
contribution to DR3DATA. The acquisition of DR3DATA will reinforce DTG’s position as the online marketing services company
for the Dutch SME sector.
5. Acquisitions and disposals
Acquisitions in 2016
On 14 January 2016 the Group (through its group company Dogado GmbH) acquired 100 % of the shares and votes in Media
Webline AG. Media Webline AG is a German company, which provides domain, webhosting and managed hosting services.
The acquisition of Media Webline AG provides the Group with increased customer base. The acquisition price was TEUR
1,884. The acquired intangible and tangible assets resulted in a goodwill of TEUR 891 which is mainly attributable to the
synergies expected to be received from integrating the company into the Group's existing hosting business. The fair values of
the acquired net assets have been determined on a provisional basis, pending completion of the final valuation.
17
European Directories Group
January-June 2016
4,941
4,941
-137
-1,535
3,269
Fair value recognised on acquisition
1000 EUR
4,058
98
621
137
-506
-934
-699
2,775
2,166
4,941
The following table summarises the consideration paid for the companies, and the amounts of the assets acquired and liabilities
assumed recognised at the acquisition date.
Consideration transferred
1000 EUR
Cash
Total consideration transferred
Cash in the acquired company
Deferred consideration
Net cash outflow from acquisition
Recognised amounts of identifiable assets acquired and liabilities assumed
Intangible assets
Property, plant and equipment
Trade and other receivables
In March 2016, the Group acquired an additional 10 % interest in Dogado Gmbh increasing its ownership from 51 % to 61 %.
See details in statement of changes in total equity on page 11.
Cash and cash equivalents
Loans
Deferred tax liabilities
Trade and other payables
Total net assets acquired
Goodwill on acquisition
Consideration price, satisfied in cash
In addition to the acquisitions made, deferred consideration of TEUR 1,143 was paid relating to acquisitions made in previous
years.
18
European Directories Group
January-June 2016
On 10 March 2015, the Group acquired 51% of the shares and votes in Dogado GmbH. As a result the Group gained control of
Dogado GmbH. The acquisition allows the Group to enter the webhosting and SaaS (Software-as-a-service) sector. In addition,
the Group will through its existing sales force in Austria (but also increasingly in Germany) be an important customer and sales
channel for Dogado's products and solutions. Goodwill of TEUR 1,006 is the strategic value of entering the Web-Hosting and
SaaS market as well as the access to the German market/customer and the Hosting/Business know-how of key-employees at
Dogado GmbH.
The Group recognised a financial liability for a put option relating to the acquisition of the non-controlling interest in Dogado
GmbH. The put option entitles the non-controlling interest of Dogado GmbH to sell their shares to the Group during 2018-2019.
The financial liability, with nominal value of TEUR 10,000, was discounted and recorded at its net present value of TEUR 8,188
as of 31 March 2015. The unwind of the discount for January-June 2016 was TEUR 411. The carrying amount of the liability
was TEUR 8,638 as of 30 June 2016.
On 12 April, 2016 the Group disposed of its 76.34 % shareholding in Tupalo Internetservices GmbH for a nominal amount. The
sale resulted in a minor loss to the Group.
Disposals during 2015
In January 2015, the Group sold its Swedish partnership, HB Förlaget 1 Ab. The partnership owns a property in Halmstad,
Sweden, which was classified as an investment property in the Group. The partnership was reclassified as assets held-for-sale
and its assets and liabilities were presented as held for sale as of 31 December 2014.
Disposals during 2016
Acquisitions in 2015
On 8 August 2015, the Group acquired 100% of the shares and votes in Kontaktia Oy, which is a Finnish digital marketing
agency offering a variety of digital marketing solutions and directory services. As a result the Group gains control of Kontaktia
Oy. The total consideration was TEUR 2,396 including goodwill on account of synergies of TEUR 1,410. The acquisition
provided the Group with an increased customer base. Detailed information about these two acquisitions has not been
presented due to the small size of the acquisitions.
On 16 November 2015 the Group acquired 100% of the shares and votes in Vilperi Digimediat Oy which is a leading Finnish
company engaged in providing digital sales and marketing solutions to the SMB sector in Finland. The total consideration was
TEUR 2,014. The fair values of the acquired net assets were measured on a provisional basis in 2015 and the final valuation
was received in Q2 2016, which resulted in adjustment to the amount of goodwill of TEUR 72. The final goodwill being TEUR
1,966. The acquisition provided the Group with an increased customer base.
19
European Directories Group
January-June 2016
1000 EUR
Jun 30
2016
Jun 30
2015
Dec 31
2015
Opening balance 307,429 327,818 327,818
Acquisitions 6,295 1,504 8,996
Capital expenditures 4,831 5,404 12,495
Disposals 0 -11,540 -11,592
Amortisation -11,716 -14,382 -30,288
Closing balance 306,839 308,804 307,429
Goodwill included in closing balance 216,054 210,500 213,816
Change in goodwill during the period due to impairments - - -
1000 EUR
Jun 30
2016
Jun 30
2015
Dec 31
2015
Cost
Balance at the beginning of period 424,413 418,774 418,774
Acquisition through business combination *)
2,238 2,323 5,639
Balance at end of period 426,651 421,097 424,413
Impairment losses
Balance at the beginning of period -210,597 -210,597 -210,597
Impairment loss - - -
Balance at end of period -210,597 -210,597 -210,597
Carrying amounts
Balance at the beginning of period 213,816 208,177 208,177
Balance at end of period 216,054 210,500 213,816
1000 EUR
Jun 30
2016
Jun 30
2015
Dec 31
2015
Opening balance 5,486 5,660 5,660
Acquisitions 98 244 269
Capital expenditures 607 812 2,010
Disposals -3 - -
Depreciation, amortisation and impairment -1,084 -1,212 -2,453
Translation differences and other adjustments -2 3 -
Closing balance 5,102 5,507 5,486
6. Changes in intangible assets
Reconciliation of carrying amount of goodwill
*) Acquisitions during January-June 2016 of TEUR 2,238 include an adjustment of TEUR 72 relating to acquisitions made in 2015.
7. Changes in property, plant and equipment
20
European Directories Group
January-June 2016
1000 EUR
Jun 30
2016
Jun 30
2015
Dec 31
2015
Cash at bank and in hand 45,850 101,511 46,242
Short-term bank deposits 463 463 463
Cash and cash equivalents (excluding bank overdrafts) 46,313 101,974 46,705
1000 EUR
Jun 30
2016
Jun 30
2015
Dec 31
2015
Cash and cash equivalents 46,313 101,974 46,705
Bank overdrafts - -42,438 -
Cash and cash equivalents 46,313 59,536 46,705
125,639 137,392 138,084
144,394 126,447 134,781
8,680 8,383 8,270
278,713 272,222 281,135
Carrying
amount Jun 30
2016
Bonds
9. Financial liabilities
Other non-current financial liabilities
Shareholder loan and accrued interest
Carrying
amount Jun 30
2015
Carrying
amount Dec 31
2015
In June 2016 European Directories DH7 B.V. (European Directories group company) purchased TEUR 13,048 nominal value of the bonds
for a consideration of TEUR 6,434.The purchase price resulted in a reduction of the carrying value of the bonds of TEUR 12,787 and gain of
TEUR 6,352, which was recognised in other financial income.The amortisation of the bond transaction costs during January-June 2016 was
TEUR 341. The amortised cost of the bond as of 30 June 2016 was TEUR 125,639
On 10 December 2013 European Directories Midco S.à r.l. issued 103,313,950 preferred equity certificates (“PECs”) with nominal value of
Euro 1.00 each. Leafy S.à r.l., the parent company of European Directories Midco S.à r.l. has subscribed all issued PECs. The maturity
date of the PECs is 10 December 2043. The PECs are unsecured and subordinated to all other obligations of the Company and no cash
interest will be paid whilst the senior secured callable floating rate bonds issued by European Directories BondCo S.C.A. are outstanding.
Each PEC carries the right to receive a fixed yield of 7.24% p.a. and a compounding profit yield of 6.26% p.a. The principal as well as
accrued interest is payable on the PECs at their maturity or if the PECs would be redeemed by the Company at an earlier date. Such
optional redemption is possible only to the extent that i) the Company will have sufficient funds available to settle its liabilities to all other
creditors as a result of the redemption payment, and ii) the Company is not insolvent and will not become insolvent after making the
redemption payment. Whilst the PECs mature in 2043, it would the Board's intention to prepay this loan as early as possible after maturing
of the bond, potentially in 2019.
The accrued interest on the PECs as of 30 June 2016 was TEUR 41,080 (30.6.2015: TEUR 23,133).
The Group has recognised a financial liability for a put option relating to the acquisition of non-controlling interest in Dogado GmbH. The put
option entitles the non-controlling interest of Dogado GmbH to sell their shares to the Group during 2018-2019. The financial liability with
nominal value of TEUR 10,000 was discounted and recorded at its net present value of TEUR 8,188 as of 31 March 2015. The unwind of
the discount for January-June 2016 was TEUR 411. The carrying amount of the liability was TEUR 8,638 as of 30 June 2016 and was
included in other non-current financial liabilities.
Total
8. Cash and cash equivalents
1000 EUR
Cash and cash equivalents include the following for the purposes of the statement of cash flows:
21
European Directories Group
January-June 2016
10. Other provisions
1000 EURJun 30
2016
Jun 30
2015
Dec 31
2015
Jun 30
2016
Jun 30
2015
Dec 31
2015
Opening balance 18,022 24,446 24,446 5,504 8,397 8,398
Increase in the provisions - - - 1,665 500 1,064
Provisions used - - -6,424 -1,089 -1,526 -3,958
Other *)
- - - 555 - -
Closing balance 18,022 24,446 18,022 6,635 7,371 5,504
Of which non-current - - - 4,054 4,255 1,930
Of which current 18,022 24,446 18,022 2,581 3,116 3,574
Total 18,022 24,446 18,022 6,635 7,371 5,504
*) The Group reclassified TEUR 555 of provisions relating to onerous leases from other current liabilities to provisions in 2016.
Austria
Finland
Tax provisions Other provisions
In the condensed consolidated interim financial statements of the Group, of MEUR 15 provision initially recognised for the Finnish tax cases,
MEUR 6.4 has been used in 2015 and the remaining provision amounts to MEUR 8.6 as of 30 June 2016. The remaining provision for the
Austrian tax cases amounts to MEUR 9.4.
In December 2015, Fonecta Group received Board of Appeal decisions for pending tax disputes in respect of European Directories Group
Oy, European Directories Services Oy, European Directories Corporations Oy and Fonecta Oy. Based on these decisions, Fonecta Group
companies paid MEUR 6.4 taxes (including penalties) in December 2015 which were recognized against the MEUR 15.0 tax provision.
Helsinki Administrative Court issued in September 2015 a ruling in a tax dispute against Finderia Oy (a dormant subsidiary of Fonecta Oy
which has been in liquidation since 2003). The Administrative Court’s ruling imposed an income tax (incl. interest) to Finderia Oy amounting
to approximately MEUR 38.8. Finderia Oy has appealed the Administrative Court's decision and requested that the payment of the tax and
interest would be deferred. The Supreme Administrative Court (“SAC”) in Helsinki granted Finderia Oy a deferral in full of the MEUR 38.8m
tax assessment. The deferral is granted until the matter has been finally resolved by the SAC. The Group’s position is that the tax claim is
unfounded and that the ruling contravenes previous court rulings and misinterprets applicable law. Finderia Oy does not have any
information on whether or not the leave to appeal will be granted, nor of the timing of the process. In the event that the SAC rejects the
appeal and the full claim of MEUR 38.8 (plus additional interest) becomes payable – which the Group considers unlikely in the short term, or
indeed, at all – then this could put a strain on the Group’s funding, representing as it does 80% of annual EBITDA. Management is aware of
this issue and is keeping it under constant review.
Uncertain tax positions/Tax provisions
The Group is involved in various discussions with local tax authorities.
In a recent Austrian tax audit (years 2007-2009), the tax authority denied Herold tax deduction for goodwill amortization relating to a
previous acquisition. The tax authority considers the transaction a related party transaction (thereby disqualifying goodwill amortisation from
2005 and interest deduction as of 2011). In addition, the tax authority questions the arm’s length nature of certain intercompany interest
expenses. The financial impact for all years up to 30 June 2016 is estimated to be maximum MEUR 10 (including interest and penalties).
Herold has appealed the decision to the local court but provided for the majority of the amount claimed. In the event that a final ruling would
be issued consistent with the tax authority’s view, this could potentially further increase tax costs (depending on the future Group’s financing
structure) by MEUR 2 to MEUR 4 annually (depending if goodwill amortization deduction or full interest deduction is disallowed).
22
European Directories Group
January-June 2016
Jun 30
2016
Jun 30
2015
Dec 31
2015
Due within a year 6,896 8,280 8,530
Due after one year and within five years 14,827 16,005 15,936
Due after five years 9,185 2,809 1,889
Total 30,908 27,094 26,355
All on-going legal actions and official proceedings are related to open tax cases. See note 10 for details on page 22.
The Key management personnel received the following benefits:
1000 EUR Q2 2016 Q2 2015 Q1-Q2 2016 Q1-Q2 2015 2015
Short-term employee benefits*)
581 719 1,181 1,449 2,987
Post-employment benefits 22 28 54 60 20
Other long-term benefits - 1 - 1 -3
Total 603 748 1,235 1,510 3,004
Related party of the Group includes its subsidiaries, key management personnel and associated companies. Related party transactions
include such operations that are not eliminated in the group's consolidated financial statements.
Key management personnel remuneration
The Board of Managers (also referred to as the Board of Directors) of European Directories Midco S.à r.l. and the CEOs in the operating
companies (Fonecta, DTG, Herold) are considered as key personnel who have authority and responsibility for planning, directing and
controlling the activities of the European Directories Group.
*) Includes amounts paid as remuneration to individuals or as reimbursement for services paid to enties providing the service.
The above represents the expense arising in the relevant period. As at 30 June 2016 and 30 June 2015, the management had no personal
shareholdings in the Group. Management has not been granted any loans.
Parent and Ultimate controlling party
Key management personnel
Leafy S.à r.l., a company incorporated in Luxembourg is the immediate parent company of the Company and has majority control over the
Company. The ultimate parent of European Directories Midco S.à r.l. is Triton Masterluxco 3 S.à r.l., a company incorporated in
Luxembourg.
12. Contingent liabilities
14. Related party transactions
Guarantees
Group companies
European Directories Midco S.à r.l is a guarantor for the obligations of European Directories BondCo S.C.A. under the bond (see note 10).
No other Group companies are guarantors. European Directories Midco S.à r.l. and European Directories BondCo S.C.A. have provided
security for certain assets (shares in certain Group companies, loan receivables and bank accounts) to secure the obligations of European
Directories BondCo S.C.A. under the finance documents.
11. Operating lease commitments
13. Legal actions and official proceedings
1000 EUR
23
European Directories Group
January-June 2016
1000 EUR
Jun 30
2016
Jun 30
2015
Dec 31
2015
Interest on loan receivables 3 1 2
Long-term interest-bearing loan receivables 1,782 1,599 1,731
Shareholder loan and acrrued interest 144,394 126,447 134,781
Long-term interest-bearing loan receivables and interest on loan receivables include receivables from European Directories Holdco S.A,
European Directories Parent S.A and Leafy S.à r.l.
15. Events after the reporting period
Transactions with related parties
On 10 December 2013 European Directories Midco S.à r.l. issued 103,313,950 preferred equity certificates (“PECs”) with nominal value of 1
Euro each. Leafy S.à r.l., the parent company of European Directories Midco S.à r.l. has subscribed all issued PECs. The PECs have a
maturity date of 10 December 2043. The PECs are unsecured and subordinated to all other obligations of the Company and no cash
interest will be paid whilst the bond is outstanding. Whilst the PECs mature in 2043, it would the Board's intention to prepay this loan as
early as possible after maturing of the bond, potentially in 2019.
There has been no material events after the reporting period.
All transactions with related parties are with arm’s length, and are with similar terms than transactions carried out with independent parties.
24
European Directories Midco S.à r. l.
Interim financial statements for the period of
1 January to 30 September 2015
R.C.S Luxembourg B 155418
46A avenue J.F. Kennedy
L-1855 Luxembourg
Subscribed capital: EUR 100,000
European Directories Midco S.à r.l.
Interim financial statements
January-June 2016
European Directories Midco S.à r.l.
Interim financial statements for the period of 1 January to 30 June 2016
Table of contents
Interim statement of profit and loss and other comprehensive income 2
Interim balance sheet 3
Interim statement of cash flows 4
Interim statement of changes in equity 5
Notes to the interim financial statements 6 - 15
European Directories Midco S.à r.l.,
Interim Financial Statements for the period
ended 30 Jun 2016
Interim financial statements are unaudited
1000 EUR Note
Q2
2016
Q2
2015
Q1-Q2
2016
Q1-Q2
2015 2015
Last
twelve
months
Board fees 4 -175 -202 -305 -383 -616 -538Other expenses 5 -35 -74 -95 -157 -214 -152Operating loss -210 -276 -400 -540 -830 -690
Finance income 9 2,329 2,183 4,657 4,342 8,757 9,072Finance costs 11 -4,843 -4,312 -9,651 -8,264 -16,630 -18,017Net finance costs -2,514 -2,129 -4,994 -3,922 -7,873 -8,945
Loss before income tax -2,724 -2,405 -5,394 -4,462 -8,703 -9,635
Income tax 6 - - - - -5 -5Loss for the period -2,724 -2,405 -5,394 -4,462 -8,708 -9,640
Total comprehensive income -2,724 -2,405 -5,394 -4,462 -8,708 -9,640
Interim statement of profit and loss
and other comprehensive income
The notes on page 6 to 15 form an integral part of these interim financial statements
2
European Directories Midco S.à r.l.,
Interim Financial Statements for the period
ended 30 Jun 2016
Interim financial statements are unaudited
Interim balance sheet
1000 EUR Note(s)
Jun 30
2016
Jun 30
2015
Dec 31
2015 ASSETS
Non-current assets
Investments in subsidiaries 7 2,043 2,043 2,043
Available-for-sale financial assets 8 - 1,153 1,153
Loan receivables 9 120,217 111,977 112,109
Total non-current assets 122,260 115,173 115,305
Current assets
Accrued interest and other receivables 9 5,829 5,110 9,481
Cash and cash equivalents - 18 -
Total current assets 5,829 5,128 9,481
Total assets 128,089 120,301 124,786
EQUITY
Equity attributable to
owners of the parent
Share capital 100 100 100
Share premium 16,449 16,449 16,449
Other reserves 10 10 10
Retained earnings -46,357 -36,718 -40,963
Total equity 10 -29,798 -20,159 -24,404
LIABILITIES
Non-current liabilities
Shareholder loan and accrued interests 11 (a) 144,394 126,447 134,781
Other financial liabilites 11 (a) - - -
Total non-current liabilities 144,394 126,447 134,781
Current liabilities
Other financial liabilites 11 (b) - 1,130 1,130
Accrued interest 11 (a) 81 37 66
Trade and other payables 11 (b) 13,412 12,846 13,213
Total current liabilities 13,493 14,013 14,409
Total liabilities 157,887 140,460 149,190
Total equity and liabilities 128,089 120,301 124,786
The notes on page 6 to 15 form an integral part of these interim financial statements
3
European Directories Midco S.à r.l.,
Interim Financial Statements for the period
ended 30 Jun 2016
Interim financial statements are unaudited
1000 EUR Q2 2016 Q2 2015
Q1-Q2
2016
Q1-Q2
2015 2015
Last
twelve
months
Cash flows from operating activities
Loss for the period -2,724 -2,405 -5,394 -4,462 -8,708 -9,640
Adjustments for:Income tax expenses - - - - 5 5
Finance costs - net 2,514 2,129 4,994 3,922 7,873 8,945Operating loss -210 -276 -400 -540 -830 -690
Interest received 91 - 255 - - 255Realised foreign exchange gains and losses and
other finance items -1 -1 - -4 -7 -3
Taxes paid - - - - -5 -5Operating cash flow before movements in
working capital-120 -277 -145 -544 -842 -443
Net change in working capital 52 -10 69 -21 34 124
Net cash from operating activities -68 -287 -76 -565 -808 -319
Cash flow from investing activitiesPurchases of available-for-sale investments 0 7 0 -20 -20 0
Net cash used in investing activities 0 7 0 -20 -20 0
Cash flows before financing activities -68 -280 -76 -585 -828 -319
Cash flows from financing activitiesProceeds from current liabilities 40 329 127 654 1,010 483
Loans granted to related parties -19 -39 -51 -88 -219 -182
Net cash from financing activities 21 290 76 566 791 301
Net increase (+) / decrease (-) in
cash and cash equivalents -47 10 0 -19 -37 -18
Cash and cash equivalents at beginning
of period 47 8 - 37 37 18Cash and cash equivalents at
the end of period 0 18 0 18 0 0
Interim statement of cash flows
The notes on page 6 to 15 form an integral part of these interim financial statements
4
European Directories Midco S.à r.l.,
Interim Financial Statements for the period
ended 30 Jun 2016
Interim financial statements are unaudited
1000 EUR Share capital Share premium Other reserves Retained earnings Total equity
Balance at 31 December 2015 100 16,449 10 -40,963 -24,404
Total comprehensive income for the period Q2
2016 - - - -5,394 -5,394
Balance at 30 June 2016 100 16,449 10 -46,357 -29,798
1000 EUR Share capital Share premium Other reserves Retained earnings Total equity
Balance at 31 December 2014 100 16,449 10 -32,256 -15,697
Total comprehensive income for the period Q2
2015 - - - -4,462 -4,462
Balance at 30 June 2015 100 16,449 10 -36,718 -20,159
Interim statement of changes in equity
Equity attributable to owners of the parent Q2 2016
Equity attributable to owners of the parent Q2 2015
The notes on page 6 to 15 form an integral part of these interim financial statements
5
European Directories Midco S.à r.l.,
Interim Financial Statements for the period
ended 30 Jun 2016
Note 1 Basis of preparation
Note 2 Use of judgements and estimates
Notes to Interim Financial Statements
for the period ended 30 June 2016
The interim financial statements for the three months ended 30 June 2016 have been prepared in accordance with the International Accounting Standard
(IAS) 34 Interim Financial Reporting. The interim financial statements do not include all the information and disclosures required in the annual financial
statements.
The accounting policies adopted are consistent with those of the previous financial year. In addition, the Company has adopted those new and amended IFRS
standards effective for the financial year ending 31 December 2015, which have been presented in the financial statements for the year ended 31 December
2015. Those new and amended IFRS standards have not had material impact to the interim financial statements. The interim financial statements are
unaudited.
The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of
assets and liabilities, income and expense. Actual results may differ from these estimates.
In preparing these interim financial statements, the significant judgements made by management in applying accounting policies and the key sources of
estimation uncertainty were the same as those that applied to the financial statements as at and for the year ended 31 December 2015.
6
European Directories Midco S.à r.l.,
Interim Financial Statements for the period
ended 30 Jun 2016
Note 3 Segment reporting
Note 4 Board of Managers fees
The Company had no employees during the period.
The Company is paying remuneration to the members of the Board of Managers.
Note 5 Other expenses
1000 EUR Q2 2016 Q2 2015
Q1-Q2
2016
Q1-Q2
2015 2015
Last twelve
months
Auditor remuneration 11 11 22 22 45 45
Other administrative expenses 24 63 73 135 169 107
Total 35 74 95 157 214 152
Auditor remunerationAudit fees 11 11 22 22 45 45
Total 11 11 22 22 45 45
Note 6 Income taxes
The Company is subject to taxation under the Luxembourg tax regulation applicable to companies.
1000 EUR Q2 2016 Q2 2015
Q1-Q2
2016
Q1-Q2
2015 2015
Last twelve
months
Current income taxes - - - - 5 5
Total - - - - 5 5
The Company is a holding company. Following from this it has no business operations generating revenues, nor any employees. Based on the internal reporting
model used by the Board of Managers, for the assessment of results and the use of resources, the Company reports as a single segment, which complies with the
approach to the organisation and management of activities. The chief operating decision maker is the Board of Managers.
7
European Directories Midco S.à r.l.,
Interim Financial Statements for the period
ended 30 Jun 2016
Note 7 Investments in subsidiaries
1000 EUR 30 Jun 2016 30 Jun 2015 31 Dec 2015
Balance at the beginning of the period 2,043 2,043 2,043
- - -
Balance at the end of the period 2,043 2,043 2,043
The Company has shareholdings in the following companies:
Name
Proportion of the
capital held, %
Capital and
reserves Profit / loss
99.99% 1,686 -262
100% -48 -40
Note 8 Available-for-sale financial assets
Note 9 Non-current and current receivables
Non-current receivables
30 Jun 2016 30 Jun 2015 31 Dec 2015
Loan to European Directories BondCo S.C.A.
Original loan amount 10 Dec 2013 103,314 103,314 103,314
Set up fee capitalised 2014 451 451 451
Interest capitalised 15,569 7,513 7,513
Total 119,334 111,278 111,278
Loan to European Directories Parent S.A. 361 251 333
Loan to European Directories Holdco S.A. 269 195 245
Loan to Leafy S.á r.l 253 253 253
Total loan receivables 120,217 111,977 112,109
1000 EUR
Changes in investments in subsidiaries
2C, rue Albert Borschette, L-1246
Luxembourg, R.C.S. Luxembourg
2C, rue Albert Borschette, L-1246
Luxembourg, R.C.S. Luxembourg
European Directories GP
("ED GP")
European Directories
BondCo S.C A. ("BondCo")
Registered
office
On 10 December 2013, in order to facilitate the financial restructuring of its group, the Company entered into a TEUR 103,314 loan agreement
with its immediate subsidiary, European Directories Bondco S.C.A. The loan is bearing an interest rate of 7,9% payable annually in arrears.
As of 30 June 2016 the Company has a loan receivable totalling TEUR 883 from European Directories Holdco S.A., European Directories
Parent S.A. and Leafy S.à r.l. payable on demand. The loans are bearing an interest rate of 0,1% payable in arrears on 30 June and 31
December each year. From the date of the interim financial statements the Company does not have the intention to ask for repayment in the
next 12 months.
On 2 December 2013 the Company contributed TEUR 2,031 to the share capital of European Directories BondCo S.C.A. and TEUR 13 to the
share capital of European Directories GP.
The amount of capital and reserves and the loss for the latest financial year of the said companies, as presented above, are based on the
financial statements as at and for the period ended 31 December 2015. European Directories BondCo S.C.A has prepared its financial
statements under IFRS and European Directories GP S.á r.I under Lux GAAP.
The Company has issued a guarantee as for its own debt for the obligations of European Directories BondCo S.C.A. under the Bonds. The
Company has also pledged the shares it owns in European Directories BondCo S.C.A. and European Directories GP as well as all claims
under the PIK intercompany loans as security to the Bonds.
On 1 April 2016 the Company sold its investment (14,83%) in Bokadirekt i Stockholm AB for an amount of TEUR 1,130 to Fonecta Oy.
8
European Directories Midco S.à r.l.,
Interim Financial Statements for the period
ended 30 Jun 2016
Current receivables
1000 EUR 30 Jun 2016 30 Jun 2015 31 Dec 2015
Interest income on financial assets classified as loans and receivables
Loan to European Directories BondCo S.C.A. 4,657 4,342 8,757
Total interest income in the statement of profit and loss 4,657 4,342 8,757
Interest accrued previous year 9,457 8,212 8,212
Set up fee/interest capitalised or paid during the period -8,313 -7,512 -7,512
Total accrued interest 5,801 5,042 9,457
Prepayments 28 68 24
Total accrued interest and other receivables 5,829 5,110 9,481
Note 10 Capital and reserves
1000 EUR Share capital Share premium Other reserves Total
30 June 2015 10,000,000 100 16,449 10 16,559
30 Jun 2016 10,000,000 100 16,449 10 16,559
Share capital
Other reserves
Note 11 Non-current and current financial liabilities and other liabilities
a.) Non-current financial liabilities 30 Jun 2016 30 Jun 2015 31 Dec 2015
Shareholder loan (preferred equity certificates) 103,314 103,314 103,314
Accrued interests on Shareholder loan 41,080 23,133 31,467
Total 144,394 126,447 134,781
Long term loan from Fonecta Oy - - -
- - -
Total non-current liabilities 144,394 126,447 134,781
Loan from Fonecta Oy is maturing in 2016 and therefore transferred to current liabilitites.
The issued share capital consists of 10,000,000 shares with a nominal value of Euro 0.01 each, all of which are fully paid up. The share capital
is divided into three classes of shares, namely 4,990,000 class A shares, 4,010,000 class B shares and 1,000,000 class C shares. Each share
entitles the holder to one vote at the Annual General Meeting. Different shares entitle their holders to a different dividend.
Legal reserve: In accordance with the Luxembourg company law, the Company is required to transfer a minimum of 5% of its net profit for
each financial year to a legal reserve. This requirement ceases to be necessary once the balance on the legal reserve reaches 10% of the
issued share capital. The legal reserve is not available for distribution to the shareholders.
On 10 December 2013 the Company issued 103,314 preferred equity certificates ("PECs") for an aggregate amount of TEUR 103,314
("PECs"). Leafy S.á r.I. is the holder of all outstanding PECs.
The PECs have a maturity date of 10 December 2043. The PECs carry a fixed yield and a profit yield which can be paid in full or in part by
issuing new PECs to the holders. As at 30 June 2016 the accrued interest amounts to TEUR 41,080 (30 June 2015: TEUR 23,133).
Number of shares (pcs)
Other current receivables comprised prepayments made in relation to insurance contracts, recognised in the following years.
The Managers assessed that interest receivables approximate their carrying amounts largely due to the short-term maturities of these
instruments.
In Q2 European Directories BondCo S.C.A. has paid TEUR 91 of intercompany interest to the Company.
9
European Directories Midco S.à r.l.,
Interim Financial Statements for the period
ended 30 Jun 2016
Accrued interest 30 Jun 2016 30 Jun 2015 31 Dec 2015
Shareholder loan 9,613 8,231 16,565
Loan from Fonecta Oy 15 27 56
9,628 8,258 16,621
Other finance expenses 23 6 9
Total finance cost in the statement of profit and loss 9,651 8,264 16,630
Accrued interest previous year
Shareholder loan 31,467 14,902 14,902
Loan from Fonecta Oy 66 10 10
Interest expenses capitalised 41,080 23,133 31,467
Interest payable on borrowings
Loan from Fonecta Oy 81 37 66
Total interest payable on borrowings 81 37 66
b. ) Current liabilites 30 Jun 2016 30 Jun 2015 31 Dec 2015
Other financial liabilities
Loan from Fonecta Oy - 1,130 1,130
- 1,130 1,130
Amounts due to group companies
De Telefoongids Holding B.V. 64 91 64
Fonecta Oy 85 84 2
Herold Business Data GmbH - 14 -38
European Directories Corporations Oy 10 - 2
European Directories Services B.V. - 11 -
European Directories OpHoldco S.à r.l 3,706 3,180 3,706
European Directories (Dh7) B.V. 9,341 9,341 9,341
13,206 12,721 13,077
Current tax 1 1 1
Accrued expenses 160 106 134
Other 45 18 1
Total trade and other payables 13,412 12,846 13,213
Interest expenses on financial liabilities classified as
loans and borrowings
The Managers assessed that trade payables and other current financial liabilities approximate their carrying amounts largely due to the short-
term maturities of these instruments.
10
European Directories Midco S.à r.l.,
Interim Financial Statements for the period
ended 30 Jun 2016
Note 12 Financial risk management
Financial risk factors
1. Market risk
The back to back structure of assets and liabilities offsets this risk.
Currency risk
Sensitivity analysis
2. Credit risk
3. Liquidity risk
The Company’s activities expose it to a variety of financial risks:
- market risk (including currency risk), fair value interest rate risk and price risk
- credit risk; and
- liquidity risk.
The Company’s overall risk management programme focuses on the structure of the assets and liabilities.
Management aims in achieving risk minimisation through the use of a (“back to back”) structure.
Price/Interest rate risks
Market risk is the potential of suffering losses due to changes in market prices or parameters influencing market prices. It includes changes
concerning illiquidity of sub-markets resulting in the inability of buying/selling positions of a special size, within a special period of time or at fair
value conditions.
Interest rate risk is covered by the structure of the assets and liabilities. Through back to back structuring management consider the interest
cash flow risk to be mitigated.
Sensitivity analysis
A reasonable possible change of 100 basis points in the interest rates at the reporting date would not impact the value of assets, liability or
shareholder equity in a significant way.
The Company has no significant currency risk as borrowings and lending contracts are denominated in Euro, the functional and presentation
currency of the Company. The Company is only subject to individual insignificant transactions in foreign currency which may arise.
A reasonable possible strengthening (weakening) of the Euro, US dollar (USD) or Swedish Crown (SEK) against all other currencies as at
reporting date would not significantly affect the measurement of the value of assets, liabilities or shareholder equity. The back to back
structure of assets and liabilities is offsetting this risk.
Credit risk is associated with potential losses arising from a business partner’s (counterparty, issuer, other contractual partner) default, i.e. its
inability or unwillingness to meet contractual obligations, or the deterioration of its creditworthiness, e.g. changes in the issuer credit rating.
The maximum credit risk exposure of the Company in the event of other parties failing to perform their obligations is considered to be the
carrying value of the loans to the Company's subsidiary.
Liquidity risk is the risk that the ability to meet payment obligations cannot be ensured at all times. In economic terms, this is the risk resulting
from the Company’s exposure to an increase of liquidity premiums. As presented under Note 9 “Non-current and current receivables” and Note
11 “Non-current and current financial liabilities and other liabilities”, the management ensures that liquidity risk minimised by matching the
liquidity and maturity structure of assets and liabilities at all times.
Changes in interest, currency and market prices would not impact the liquidity of the Company at the reporting date, value of assets, liabilities
or shareholder equity in any significant way. The back to back structure of assets and liabilities offsets these risks.
11
European Directories Midco S.à r.l.,
Interim Financial Statements for the period
ended 30 Jun 2016
Carrying amounts and fair value
Trade and other
receivables Investments
Trade and
other
receivables
Cash and cash
equivalents Total
Financial assets not measured at fair value
120,217 - 5,829 - 126,046
- - - - 0
- 2,043 - - 2,043
120,217 2,043 5,829 - 128,089
Interest
bearing loans
and
borrowings
Trade and other
payables Total
Financial liabilities not measured at fair value
- - - 13,412 13,412
144,394 - 81 - 144,475
144,394 - 81 13,412 157,887
Trade and other
receivables Investments
Trade and
other
receivables
Cash and cash
equivalents Total
Financial assets not measured at fair value
112,109 - 9,481 - 121,590
- - - - -
- 3,196 - - 3,196
TOTAL 112,109 3,196 9,481 - 124,786
Interest
bearing loans
and
borrowings
Trade and other
payables Total
Financial liabilities not measured at fair value
- - 1,130 13,213 14,343
134,781 - 66 - 134,847
134,781 - 1,196 13,213 149,190
Trade and other payables
The following table shows the carrying amounts of financial instruments. All financial instruments presented are valued at
amortized cost through the use of the effective interest rate method. The carrying values of the financial instruments, other
than shareholder loan, are considered to be a good approximation of the fair value of the financial instruments.
30 June 2016
Non- current assets Current assets
Trade and other receivables
Cash and cash equivalents
Corporate securities
TOTAL
Non- current liabilities Current liabilities
Interest bearing loans and borrowings
Current liabilities
Interest bearing loans and borrowings
Trade and other payables
Borrowings
TOTAL
31 Dec 2015
Non- current assets Current assets
Trade and other receivables
Borrowings
TOTAL
Cash and cash equivalents
Corporate securities
Non- current liabilities
12
European Directories Midco S.à r.l.,
Interim Financial Statements for the period
ended 30 Jun 2016
Note 13 Related parties
Related parties of the Company
Ownership structure
1000 EUR Q1-Q2 2016 Q1-Q2 2015 2015
Loan receivables 120,217 111,977 112,109
Loan payables 144,394 126,447 134,781
Interest income 4,657 4,342 8,757
Interest expenses 9,628 8,258 16,621
Accrued interest on loan receivables 5,801 5,042 9,457
Accrued interest on loan payables 81 37 66
Board fees* 413 552 954
Note 14 Contingencies and commitments
Note 15 Events after the balance sheet date
There are no material events after the balance sheet date.
*The Midco board is active as well at the level of the Group, therefore TEUR 108 (TEUR 169) was recognised by another European
Directories Group company in Jan-Jun 2016 and TEUR 305 (TEUR 383) European Directories Midco S.à r.l.
The Company’s related party comprise the following:
* European Directories BondCo S.C.A.
* Eurpean Directories Parent S.A.
* Leafy S.à r.l
* Board of Managers.
* European Directories Holdco S.A.
Related party transactions
The Managers of the Company are not aware of any significant contingent liabilities as at 30 June 2016.
There are no commitments in respect of retirement pensions for members of the management and supervisory bodies. There are no
advances, loans or commitments given on their behalf by way of guarantee of any kind granted to the members of those bodies during
the year period 30 June 2016.
European Directories Midco S.à r.l. is the parent company of the European Directories Group. Triton Fund, majority through Leafy S.á
r.l., holds at the balance sheet date 91.1 % of the shares in European Directories Midco S.à r.l.
European Directories Midco S.à r.l. has shareholdings in two subsidiaries, European Directories BondCo S.C.A., and European
Directories GP. For further information, see Note 7 "Investment in subsidiaries".
Key management personnel of the Company consist of the Board of Managers ("the Managers").
European Directories Midco S.à r.l is a guarantor for the obligations of European Directories BondCo S.C.A. under the bond. No other
Group companies are guarantors. European Directories Midco S.à r.l. and European Directories BondCo S.C.A. have provided
security for certain assets (certain shares, loan receivables and bank accounts) to secure the obligations of European Directories
BondCo S.C.A. under the finance documents.
13
R.C.S. Luxembourg : B18140146A, avenue J.F. KennedyL-1855 LuxembourgShare Capital : 2,031 Mio EUR
Interim financial statements for the period of
European Directories BondCo S.C.A.
1 January 2015 to 30 September 2015
European Directories BondCo S.C.AInterim financial statements
January-June 2016
European Directories BondCo S.C.A.Interim financial statements for the period ended 30 June 2016
Table of contents
Interim statement of profit and loss and other comprehensive income 2 Interim balance sheet 3 Interim statement of changes in equity 4 Interim statement of cash flow 5 Notes to the interim financial statements 6 - 15
2
1000 EUR Note Q2 2016 Q2 2015Q1 - Q2
2016Q1 - Q2
2015 2015 LTMAdministrative expenses 5 14 -34 -9 -70 -238 -177Operating loss 14 -34 -9 -70 -238 -177
Finance income 8 5,288 5,169 10,576 10,298 20,696 20,974Finance costs 11 -5,288 -5,170 -10,576 -10,300 -20,711 -20,987
Net finance costs - -1 - -2 -15 -13
Profit or Loss before income tax 14 -35 -9 -72 -253 -190
Income tax 6 - -8 - -8 -9 -1Profit or Loss for the period 14 -43 -9 -80 -262 -191
Total comprehensive income 14 -43 -9 -80 -262 -191
Interim statement of profit and loss and other comprehensive income
3
Interim balance sheet
1000 EUR Note(s) 30 Jun 2016 30 Jun 2015 31 Dec 2015
ASSETS
Non-current assets
Investments in subsidiaries 7 2,000 2,000 2,000Loan receivables 8 277,325 269,347 268,990Total non-current assets 279,325 271,347 270,990
Current assets
Accrued interest and other receivables 8 5,918 6,226 9,856Deferred charges 9 20 - - Cash and cash equivalents 235 133 128Total current assets 6,173 6,359 9,984
Total assets 285,498 277,706 280,974
EQUITY
Equity attributable to owners of the parent
Share capital 2,031 2,031 2,031Profit or (loss) brought forward -345 -80 -84Profit or (loss) for the year/ period -9 -84 -262Total equity 10 1,677 1,867 1,685
LIABILITIES
Non-current liabilities
Interest bearing loans and borrowings 11 119,334 111,276 111,277Bond 11 157,991 158,070 157,712Total non-current liabilities 277,325 269,346 268,989
Current liabilities
Accrued interest on loans and borrowings 11 6,452 5,696 10,138Trade and other payables 44 797 162Total current liabilities 6,496 6,493 10,300
Total liabilities 283,821 275,839 279,289
Total equity and liabilities 285,498 277,706 280,974
4
1000 EUR Share capital Retained earnings Total equity
Opening balance 1 January 2016 2,031 -345 1,685
Total comprehensive income for the Q2 - -9 -9
Balance at 30 June 2016 2,031 -354 1,677
1000 EUR Share capital Retained earnings Total equity
Opening balance 1 January 2015 2,031 -84 1,947
Total comprehensive income for the Q2 - -80 -80
Balance at 30 June 2015 2,031 -164 1,867
Equity attributable to owners of the parent Q2 2016
Equity attributable to owners of the parent Q2 2015
Interim statement of changes in equity
5
Interim statement of cash flows
1000 EUR Q2 2016 Q2 2015 Q1 - Q2
2016Q1 - Q2
2015 2015 LTM
Cash flow from operating activitiesLoss for the period 14 -43 -9 -80 -262 -191
Adjustments for:Income tax expenses - 8 - 8 9 1Finance costs - net - 1 - 2 15 13Operating loss 14 -34 -9 -70 -238 -177
Interest received 3,283 2,902 6,180 5,797 11,618 12,001Interest paid -2,942 -2,877 -5,926 -5,710 -11,392 -11,608Realised foreign exchange gains and losses and other finance items - -1 - -2 -15 -13Taxes paid - -7 - -7 -9 -2Operating cash flow before movements in working capital
356 -17 246 8 -36 202
Net change in working capital -152 65 -140 101 140 -101Net cash from operating activities 204 48 106 109 104 101
Changes in loan receivables - - - - 640 640Net cash used in investing activities - - - - 640 640
Cash flow before financing activities 204 48 106 109 744 741
Cash flow from financing activitiesPrepayment of Bonds - - - - -640 -640Net cash used in financing activities - - - - -640 -640
Net increase (+) / decrease (-) in cash and cash equivalents 204 48 106 109 104 101
Cash and cash equivalents at beginning of period 30 85 128 24 24 133Cash and cash equivalents at the end of period 235 133 235 133 128 235
6
Notes to Interim Financial Statementsfor the period ended 30 June 2016
Note 1 Basis of preparation
Note 2 Use of judgements and estimates
The interim financial statements for the six months ended 30 June 2016 have been prepared inaccordance with the International Accounting Standard (IAS) 34 Interim Financial Reporting.
The interim financial statements do not include all the information and disclosures required in the annualfinancial statements and should be read in conjunction with the audited annual financial statement for theperiod ended 31 December 2015.
The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of assets and liabilities, income and expense. Actualresults may differ from these estimates.
In preparing these interim financial statements, the significant judgements made by management inapplying accounting policies and the key sources of estimation uncertainty were the same as those thatapplied to the financial statements as at and for the period ended 31 December 2015.
The accounting policies adopted are consistent with those of the previous financial year. In addition, theCompany has adopted those new and amended IFRS standards effective for the financial year ending 31December 2015, which have been presented in the financial statements for the year ended 31 December2015. Those new and amended IFRS standards have not had material impact to the interim financialstatements. The interim financial statements are unaudited.
7
Note 3 Segment reporting
Note 4 Employee benefits
Note 5 Other expenses
1000 EUR Q2 2016 Q2 2015 Q1 - Q2 2016 Q1 - Q2 2015 2015 LTM
Auditor remuneration 5 9 9 9 18 18Other administrative expenses -19 25 - 61 220 159Total -14 34 9 70 238 177
Auditor remunerationAudit fees 5 9 9 9 18 18Fees for other assurance services - - - - - -Tax advisory fees - - - - - -
Total 5 9 9 9 18 18
Note 6 Income taxes
For the period ended the administrative expenses mainly comprise administration and corporate secretarial fees.
The Company’s tax position at 30 June 2016 is based on the Company’s best estimate using the available information onlocal taxation rules and regulations and taking into account tax facilities and non-deductible costs. The tax return for the yearended 31 December 2014 has been filed in February 2016.
The Company is a holding company. Following from this it has no business operations generating revenues, nor anyemployees. Based on the internal reporting model used by the Company’s general partner European Directories GP S.à.r.l.for the assessment of results and the use of resources, the Company reports as a single segment, which complies with theapproach to the organisation and management of activities. The chief operating decision maker is the Board of EuropeanDirectories GP S.à r.l.
The Company is subject to taxation under the Luxembourg tax regulation applicable to companies.
Any temporary difference arising on assets will be offset by a corresponding difference in liabilities. Therefore, the Companydoes not have any deferred tax expense.
During the year the Company did not employ any personnel and, consequently no payments for wages, salaries or socialsecurities were made.
8
Note 7 Investments in subsidiaries
1000 EUR 30 Jun 2016 30 Jun 2015 31 Dec 2015Balance at the beginning of the period 2,000 2,000 2,000
Changes in investments in subsidiaries - - -
Balance at the end of the period 2,000 2,000 2,000
The Company has a shareholding in the following company:
Name
Profit for the year ended 31 Dec
2015
(137,938) 10,284
The Company was acquired on 10 December 2013.
The above figures are presented under statutory requirements of Luxembourg GAAP.
The Company’s general partner, European Directories GP S.à r.l., performs an impairment test annually.
Note 8 Non-current and current receivables
Maturity of loan receivables
1000 EUR 30 Jun 2016 30 Jun 2015 31 Dec 2015
Due in one year - - - Due in two to five years 157,991 158,070 157,713Due in more than five years 119,334 111,277 111,277Total 277,325 269,347 268,990
Capital and reserves as at 31
Dec 2015Registered
office
46A avenue J.F. Kennedy, L-1855 Luxembourg, Luxembourg R.C.S. B 155420
European Directories OpHoldco S.à r.l
Proportion of the capital held, %
100%
On 10 December 2013 European Directories BondCo S.C.A. entered into loan agreements with European Directories Opholdco S.à r.l.:
1) For an amount of EUR 160,000,000.00. The interest is accrued on a daily basis at a floating rate of EURIBOR 3M + 7% p.a. and paidquarterly.
2) For an amount of EUR 103,313,950.00. The interest is accrued on a daily basis at a rate of 7.9%.
9
Note 8 Non-current and current receivables (continued)
Non-current assets30 Jun 2016 30 Jun 2015 31 Dec 2015
Loan to subsidiaryLoan 1 160,000 160,000 160,000Loan 2 103,313 103,313 103,313
263,313 263,313 263,313
Original cost -2,800 -2,800 -2,800
Amortisation of original cost 1,431 870 1,153
Set up fee capitalised 2014 451 451 451
Prepayment of loan -640 - -640
Interest capitalised 1 January 2016 15,570 7,513 7,513Total loan receivables 277,325 269,347 268,990
Current assets
1000 EUR 30 Jun 2016 30 Jun 2015 31 Dec 2015
Loan 1 5,919 5,948 11,940Loan 2 4,658 4,350 8,756
Total interest income in the statement of profit and loss 10,576 10,298 20,696
Interest receivable beginning of the periodLoan 1 396 633 633Loan 2 9,455 8,213 8,212
9,851 8,846 8,845
Interest income received or capitalised during the periodLoan 1 -5,671 -5,797 -11,618Loan 2 -8,566 -7,513 -7,513
-14,238 -13,310 -19,132Amortised during the period
Loan 1 -279 -277 -559Loan 2 - -7 -
-279 -284 -559Total interest receivables from loans to European Directories Opholdco S.à r.l.
Loan 1 365 507 396Loan 2 5,547 5,043 9,455
5,912 5,550 9,851 Other receivables 6 676 5
Total accrued interest and other receivables 5,918 6,226 9,856
Interest income on financial assets classified as loans and receivables during the period
The interest is calculated using the effective interest method. The nominal interest rate is 7.9% for the TEUR 103,313 shareholder loan and EURIBOR 3M +7% for the TEUR 160,000 senior secured callable floating rate bond.
The Managers assessed that interest receivables approximate their carrying amounts largely due to the short-term maturities of theseinstruments.
10
Note 9 Deferred charges
Deferred charges
1000 EUR 30 Jun 2016 30 Jun 2015 31 Dec 2015Deferred charges 20 - -
Total accrued interest and other receivables 20 - -
Note 10 Capital and reserves
Share capital
Legal reserve
Note 11 Non-current and current liabilities
Maturity of borrowings 30 Jun 2016 30 Jun 2015 31 Dec 2015Due in one year - - - Due in two to five years 157,991 158,070 157,712Due in more than five years 119,334 111,276 111,277Total 277,325 269,346 268,989
European Directories Midco S.à r.I. has issued a guarantee for the obligations of the Company under the bonds.
On 25 October 2013 the initial capital was set at TEUR 31 represented by 1 unlimited share having a nominal value of Euro 1, which isfully paid-up and 30,999 limited shares having a nominal value of Euro 1 each, which are fully paid-up.
The holders of Limited Shares bear a liability which is limited to the amount of their contribution to the Company as share capital, sharepremium or capital surplus. The liability of the holders of Unlimited Shares for the liabilities of the Company shall be joint and unlimited,as set out in article 102 of the Companies Act.
During 2013 the entity increased the share capital by an amount of TEUR 2,000 by way of contribution in kind by issue of 2,000,000 newlimited shares of a nominal value of Euro 1 each.
At 30 June 2016 the share capital is represented by 2,031,000 shares with a total amount of TEUR 2,031.
In accordance with the Luxembourg company law, the Company is required to transfer a minimum of 5% of its net profit for each
financial year to a legal reserve. This transfer is made following approval of its statutory accounts by the shareholders. This requirement
ceases to be necessary once the balance on the legal reserve reaches 10% of the issued share capital. The legal reserve is not
available for distribution.
Dividends on ordinary shares are recognised in the financial statements in the period in which they are approved by the Company's
shareholders.
On 10 December 2013 the Company entered into a loan agreement with European Directories Midco S.à r.l. for Euro 103,313,950.00.The interest is accrued on a daily basis at a rate of 7.9%.On 10 December 2013 the Company issued senior secured callable floating rate bonds ("Bonds") in the amount of Euro 160,000,000.00to the market. The proceeds of the Bonds were used to grant a loan to European Directories OpHoldco S.à r.l., which used the proceedsto repay all previous bank debt. The Bonds have been listed on NASDAQ OMX Stockholm since 5 December 2014 ("ISINSE0005505831").
The interest is accrued on a daily basis at a floating rate of 3 months EURIBOR rate plus a 7% p.a. margin. Interest is payable quarterlyin arrears. The Bonds have a maturity date of 10 December 2018.
The Bonds rank above the preferred equity certificates ("PECs") issued by the parent, European Directories Midco S.à r.I.
11
Note 11 Non-current and current liabilities (continued)
Non-current financial liabilities 30 Jun 2016 30 Jun 2015 31 Dec 2015
Bond issuance 160,000 160,000 160,000
Loan to European Directories Midco S.à r.l. 103,313 103,313 103,313263,313 263,313 263,313
Original cost -2,800 -2,800 -2,800Amortisation of original cost 1,431 870 1,152
Set up fee capitalised 2014 451 451 451
Prepayment of bond -640 - -640
Interest capitalised 1 January 2016 15,570 7,513 7,513
Total non-current liabilities 277,325 269,346 268,989
Current liabilities 30 Jun 2016 30 Jun 2015 31 Dec 2015
Loan to Midco S.à r.l 4,658 4,350 8,756Bonds 5,919 5,948 11,940
10,576 10,298 20,696
Other finance expenses - 2 15
Total finance costs in the statement of profit and loss 10,576 10,300 20,711
Interest payable beginning of the periodLoan to Midco S.à r.l 9,455 8,212 8,212Bonds 683 693 693
10,139 8,905 8,905
Interest expenses paid or capitalised during the periodLoan to Midco S.à r.l -8,312 -7,513 -7,513Bonds -5,671 -5,710 -11,608
-13,982 -13,223 -19,121Amortised during the periodLoan to Midco S.à r.l - -7 - Bonds -279 -277 -599
-279 -284 -559
Interest payable on loan to Midco S.à r.l. 5,801 5,042 9,455Interest payable on bonds 652 654 683
Total accrued interest on loans and borrowings 6,452 5,696 10,138
Interest expenses from financial liabilities measured at amortised cost during the period
12
Note 11 Non-current and current liabilities (continued)
Trade and other payables comprise accrued audit remuneration.
Note 12 Financial risk management
The Board assessed that trade payables and other current financial liabilities approximate their carrying amounts largely due to the short-
term maturities of these instruments.
Market risk Price/ Interest rate risk Market risk is the potential of suffering losses due to changes in market prices or parameters influencing market prices. It includeschanges concerning illiquidity of sub-markets resulting in the inability of buying/ selling positions of a special size, within a special periodof time or at fair value conditions. Interest rate risk is covered by the structure of the assets and liabilities. Through back to back structuring management consider theinterest cash flow risk to be mitigated.
Sensitivity analysis A reasonable possible change of 100 basis points in the interest rate at the reporting date would not impact the value of assets, liabilityor shareholder equity in a significant way. The back to back structure of assets and liabilities offsets this risk.
Currency risk The Company has no significant currency risk as borrowings and lending contracts are denominated in Euro, the functional andpresentation currency of the Company. The Company is only subject to individual insignificant transactions in foreign currency whichmay arise. Sensitivity analysis A reasonable possible strengthening (weakening) of Euro, US dollar (USD) or Swedish Krona (SEK) against all other currencies as atreporting date would not significantly affect the measurement of the value of assets, liabilities or shareholder equity. The back to backstructure of assets and liabilities offsets this risk.
Financial risk
A Company’s activities expose it to a variety of financial risks:• Market risk, including currency risk, fair value interest rate risk, cash flow interest rate risk and price risk• Credit risk; and • Liquidity risk The company’s overall risk management programme focuses on the structure of the assets and liabilities.Management aims in achieving risk minimisation through the use of a (*back to back”) structure.
13
Note 12 Financial risk management (continued)
Credit risk Credit risk is associated with potential losses arising from a business partner’s (counterparty, issuer, other contractual partner) default,i.e. its inability or unwillingness to meet contractual obligations, or the deterioration of its creditworthiness, e.g. changes in the issuercredit rating. The maximum credit risk exposure of the Company in the event of other parties failing to perform their obligations is considered to bethe carrying value of loans to the Company's subsidiary.
Liquidity risk Liquidity risk is the risk that the ability to meet payment obligations cannot be ensured at all times. In economic terms, this is the riskresulting from the Company’s exposure to an increase of liquidity premiums. As presented under Note 8 “Non-current and currentreceivables” and 11 “Non-current and current financial liabilities and other liabilities”, the Board ensures that liquidity risk is minimised bymatching the liquidity and maturity structure of assets and liabilities at all times.
Changes in interest, currency and market prices would not impact the liquidity of the Company at the reporting date, value of assets,liabilities or shareholder equity in any significant way. The back to back structure of assets and liabilities offsets these risks.
14
Carrying amounts and fair value
Trade and other receivables
Investments in subsidiaries
Trade and other receivables
Cash and cash equivalents Total
Financial assets not measured at fair value277,325 - 5,938 - 283,263
- - - 235 235- 2,000 - - 2,000
277,325 2,000 5,938 235 285,498
Interest bearing loans and
borrowingsTrade and other
payables TotalFinancial liabilities not measured at fair value
- - - 44 44119,334 - 5,801 - 125,134157,991 - 652 - 158,643277,325 - 6,452 44 283,821
Trade and other receivables
Investments in subsidiaries
Trade and other receivables
Cash and cash equivalents Total
Financial assets not measured at fair value268,990 - 9,856 - 278,846
- - - 128 128- 2,000 - - 2,000
268,990 2,000 9,856 128 280,974
Interest bearing loans and
borrowingsTrade and other
payables TotalFinancial liabilities not measured at fair value
- - - 162 162111,277 - 9,455 - 120,732157,712 - 683 - 158,395268,989 - 10,138 162 279,289
Trade and other payables
The following table shows the carrying amounts of financial instruments. All financial instruments presented are valued atamortized cost through the use of the effective interest rate method. The carrying values of the financial instruments, otherthan bond, are considered to be a good approximation of the fair value of the financial instruments.
30 Jun 2016Non- current assets Current assets
Trade and other receivablesCash and cash equivalentsCorporate securitiesTOTAL
Non- current liabilities Current liabilities
Interest bearing loans and borrowings
Current liabilities
BorrowingsBond issue
Non- current liabilities
Interest bearing loans and borrowings
TOTAL
31 Dec 2015Non- current assets Current assets
Trade and other receivables
Trade and other payablesBorrowingsBond issueTOTAL
Cash and cash equivalentsCorporate securitiesTOTAL
15
Note 13 Related parties
Related parties of the Company
Ownership structure
Related party transactions
1000 EUR Q1-Q2 2016 Q1-Q2 2015 2015Loan receivables 277,325 269,347 268,990Loan payables 119,334 111,276 111,277Interest income 10,576 10,298 20,696Interest expenses 4,658 4,350 8,756Accrued interest on loan receivables 5,801 5,042 9,851Accrued interest on loan payables 6,452 5,696 9,455
Note 14 Contingencies and commitments
Note 14 Events after the balance sheet date
The Company’s related parties comprise the following:* Leafy S.à.r.l.* European Directories OpHoldco S.à r.l.* European Directories Midco S.à r.l.* European Directories GP S.à r.l.* Supervisory Board.
European Directories BondCo S.C.A. is a Luxembourg partnership limited by shares with European Directories GP S.à r.l as itsunlimited partner and European Directories Midco S.à r.l., the parent company of the European Directories Group, as its limitedpartner. European Directories Midco S.à r.l. is a holding company and is registered with the Luxembourg register of commerceunder number B 155418. Triton Fund, through Leafy S.á r.l., holds 91.1 % of the shares in European Directories Midco S.à r.l.
European Directories BondCo S.C.A. owns 100 % in European Directories OpHoldco S.à r.l. (see Note 7 "Investments insubsidiaries".)
Key management personnel of the Company consist of the members of the Supervisory Board.
European Directories Midco S.à r.l is a guarantor for the obligations of European Directories BondCo S.C.A. under the bond. Noother Group companies are guarantors. European Directories Midco S.à r.l. and European Directories BondCo S.C.A. haveprovided security for certain assets (certain shares, loan receivables and bank accounts) to secure the obligations of EuropeanDirectories BondCo S.C.A. under the finance documents.
No subsequent events have occurred at the date these interim financial statements were available for issuance that would have amaterial impact on the result or financial position the Company.
There are no commitments in respect of retirement pensions for members of the management and supervisory bodies. There areno advances, loans or commitments given on their behalf by way of guarantee of any kind granted to the members of those bodiesduring the financial period ended 30 June 2016.
The members of the Supervisory Board of the Company are not aware of any significant contingent liabilities as at 30 June 2016.
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