TALLINN - Estonia's ongoing economic downturn has impacted the advertising market, with the two major players reporting that first quarter revenues fell drastically.
Ekspress Group, the largest media group, announced that earnings fell 41 percent over the first three months of the year compared with the first quarter in 2007, to 10.9 million kroons (700,000 euros).
CEO Priit Leito still maintained that, given the current state of affairs on the advertising market, Ekspress Grupp performed well during the accounting period.
Schibsted, the Norwegian media group, announced in an interim report that the first quarter operating profit of its Baltic holdings dropped to 7 million Norwegian kroner (893,000 euros) compared to 19 million kroner for the first quarter last year and 62 million kroner for the entire 2007.
Schibsted is majority shareholder in Eesti Media, which owns and operates Postimees, Estonia's leading daily paper, and SL Ohtuleht, the second largest daily. In Lithuania it publishes 15 Min, a free daily.
Ekspress Group is a publicly listed company that published the weekly Eesti Ekspress and the Eesti Pahvaleht daily and runs the highly profitably Delfi news portals in all three Baltic countries and Ukraine.
Both groups said that, despite the worsening economic conditions, revenues were up year-on-year.
Ekspress Group reported that consolidated sales totaled 321.3 million kroons in the first quarter, up 29 percent year-on-year.
As Schibsted explained, the cooling of the economy, coupled with increased costs, reduced profitability, particularly in Estonia. Like Ekspress Group, Schibsted also posted an increase in revenues. However, a jump in circulation numbers was offset by rapid payroll expenditures, the company said.
Ekspress Group was also feeling the aftereffects of its expansion program last year. Leito said that greater financial costs and depreciation, developments carried out in the first quarter had an impact on group profit.
The group launched an automotive portal and real estate portal, and in Lithuania it opened
the entertainment portal www.klubas.lt
Also, the group added Maaleht, a weekly on home and gardening, to its list of publications.
In 2007 Ekspress Grupp, which employs more than 2,500, posted sales of 1.1 billion kroons and earnings of 92.1 million kroons.