* New accounting principle and refined calculation methods for online
revenue recognition and reporting
* Changes in publication dates for printed directories
BROMMA, Sweden, April 15 /PRNewswire-FirstCall/ --
Prior to the interim report for the period January - March 2004, which
will be released on April 26, the following information is provided.
New accounting principle and refined calculation methods for online
revenue recognition and reporting The Board of Directors of Eniro has decided
to change the accounting principle pertaining to accounting for online
revenues. This change is an alignment to industry standards and complies with
recommendations issued by the Swedish Financial Accounting Standards Council.
The company's auditor, OhrlingsPriceWaterhouseCoopers AB, supports the change.
Accordingly, effective January 1, 2004, online revenues and costs will be
recognized over the length of the customer contract period, which is normally
12 months. Previously, the full value of the customer contract was recognized
as revenue and costs in the same quarter as the order booking and initial
publication on the Internet.
In addition, the Board has decided to refine the method of allocating
revenues between offline (printed directories) and online products when both
products are sold together to a customer as a bundled offering. This pertains
mainly to Sweden. The total sales of bundled products in the Swedish
operations is estimated to be in the range of SEK 500 M annually. As of
January 1, 2004, approximately 30 percent of the revenues associated with the
sales of bundled products will be reported as online revenues. The usage of
online and offline products has been used to determine this allocation because
it indicates the value attributed to each product.
The effect of the above changes, taken together, will be a one time charge
against consolidated shareholders' unrestricted equity estimated at
approximately SEK 500 M compared with the balance on the closing date 2003.
The changes will not have any impact on Eniro's cash flow. The consolidated
income statements recalculated in accordance with the new principles will not
vary materially from the adopted income statements. Pro forma quarterly data
from 2002 and 2003 will be published in the interim report released on
April 26.
Effects of changes in publication dates for certain printed directories
Eniro's operating revenues from printed directories (offline revenues) are
reported at the time each directory is published. Consequently, changes in
publication dates, for example, when publication of a directory is shifted
into the next quarter, affect comparisons between revenues in different years
and quarters. In a comparison between 2004 and 2003 for Sweden excluding
Voice, the net effect of changed publication dates for the full year 2004 is
estimated as a reduction in comparable revenues of SEK 20 M. For the first
quarter of 2004 and the corresponding period in 2003, the effect of changes in
publication dates is estimated to amount to a reduction, net, in revenues of
some SEK 45 M in 2004. This means that first quarter of 2004 does not include
revenues from the directories that previously were published in the first
quarter of prior years whose value is estimated at about SEK 45 M. For the
second quarter, the effect is estimated as a reduction of SEK 10 M in
comparable revenues. For the third and fourth quarters, the effect is
estimated as an increase of SEK 40 M and a reduction of SEK 5 M, respectively.
For information:
Lars Berg, Chairman of the Board and acting CEO. Tel. +46 8 634 7001
Boel Sundvall, Vice President, Corp Comm & IR. Tel. +46 8 634 7006,
mobile +46 70 560 60 18, boel.sundvall@eniro.com
http://www.eniro.com
Eniro is the leading media company in the Nordic region for search
channels that connect buyers and sellers. Printed directories, CD-ROMs,
directory assistance, Internet and Mobile services help users to easily find
what they are loking for, thus making them effective marketing channels for
advertisers.
Eniro operates in 18 European markets and employs about 4,600 people. In
2003, operating revenues amounted to SEK 4,901 M with operating income before
depreciation (EBITDA) of SEK 1,378 M. Eniro is listed on the Stockholm
Exchange.
SOURCE Eniro AB
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Related links:
http://www.eniro.com
CONTACT:
Lars Berg, Chairman of the Board and acting
CEO, +46-8-634-7001, or Boel Sundvall, Vice President, Corp Comm
& IR, +46-8-634-7006, or mobile, +46-70-560-60-18, or
boel.sundvall@eniro.com
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