Board of Directors' Report 2010

The consolidated revenues of NHST Media Group increased by 10 % to NOK 1,115 million in 2010 from NOK 1,015 million in 2009. Pre-tax profits of NOK 38.7 million were achieved in 2010, as against a loss of NOK 50.7 million in 2009.

The growth in 2010 took revenues to their highest level in the group’s history. The increase is due to strong advertising revenue in particular, but also increased subscription revenues for the group’s publications. To this can be added healthy growth for several of the group’s new digital activities.

GENERAL
The year was characterised by improvements in the economy over the previous year in several of the most important markets where the group operates, especially Norway, although there was still a great deal of macroeconomic uncertainty and nervousness.

The improved market conditions provided several of the group’s businesses with opportunities for new growth. Advertising revenue rose by 19 % and circulation revenue by 1 %.

For Dagens Næringsliv, the largest company in the group, the year was characterised by new advances. Circulation rose by 931 copies to 80,559, contributing to the increase in circulation revenue. But, above all, there was substantial growth in advertising revenue after advertising sales had been badly hit by the financial crisis in the autumn of 2008 and in 2009. The increase reflected improved market conditions, but also increased market shares, especially for brands.
The rest of the group also made advances and increased profitability, but with large variations from company to company. The global publications had stable circulation increases overall, while DN Nye Medier experienced a moderate increase in traffic. Advertising revenue increased, particularly towards the end of the year.

The group has maintained its commitment to the renewable energy market in the form of Recharge, its new global news publication. While the publication has established a strong brand and its advertising revenue is growing, circulation is not yet at a satisfactory level. NOK 17.8 million has been charged to consolidated operating income for the investment in 2010 and a positive contribution is not expected in 2011 either.

Of the group’s non-publishing activities, MyNewsdesk and Nautisk Forlag had good growth, while Smartcom did not achieve satisfactory development owing to both market-related and operational factors.

Overall this resulted in the consolidated revenue of NHST Media Group increasing by 10 % to NOK 1,115 million in 2010. Pre-tax profit of NOK 38.7 million was achieved in 2010, as against a loss of NOK 50.7 million in 2009, an improvement of NOK 89.4 million.

The group had net financial items of NOK 1.3 million for the year. Large exchange rate fluctuations were a feature of 2010, but their impact was limited both as a result of the group’s foreign exchange revenue being partly offset by foreign exchange costs and thanks to a strategy of hedging most of the remaining net cash flows in foreign currency during the year.

The group’s publications have strengthened their position among readers and advertisers. Their strong market positions provide a good basis for long-term development and growth, although both structural changes and economic fluctuations continue to be a source of uncertainty. The group therefore attaches great importance to maintaining its long-term ability to compete effectively in all the markets where it operates. The group’s publications and journalists won a number of awards in Norway and internationally during the year.

In 2010 Dagens Næringsliv consciously focused on further enhancing the long-term editorial quality of the product. In the autumn, Dagens Næringsliv became the first newspaper in Norway to launch access to the paper via a PDF-based iPad solution. In July agreement was reached on moving Dagens Næringsliv’s print run for Eastern Norway to Schibsted-Trykk with effect from April 2011. The agreement provides predictability for most of the newspaper’s print run up to 2026 and flexibility in a newspaper market that will experience major changes in the next few years.

The global market segments in which NHST Media Group has an international position as a news supplier – oil/gas, shipping, seafood and renewable energy – continued to be affected by the crisis mood in the international economy for the first part of 2010, but there are now definite signs of improvement. The need for independent, credible news reporting has increased in these industries, giving our publications a good opportunity to strengthen what are already leading market positions in relation to the competition. NHST Media Group, which already owned 60 % of the shares in IntraFish Media, acquired the remaining 40 % from A-pressen for NOK 24.8 million in February 2011.

DEVELOPMENT
Digital developments continued to make its mark on the media industry in 2010 influenced both organisation and product development in NHST Media Group during the year, including:

• Dagens Næringsliv and DN Nye Medier came together under joint, integrated management.
• Dagens Næringsliv made its e-paper available in a version for the iPad and introduced a separate subscription olution for electronic access to the newspaper.
• Upstream and Recharge restricted electronic access to their content to paying subscribers.
• MyNewsdesk proved that its product concept was viable in other Scandinavian countries and embarked on active internationalisation of the business.

The world’s media houses turned their attention to California in 2010. There was much speculation and, for many, great expectations related to the launch of Apple’s iPad and the consequences the new generation of tablets would have for news consumption and related business models. Editorially, tablets imply further proliferation of digital channels for accessing content. Commercially, they offer opportunities for new products and business models, but potentially a new, tougher competitive situation too.

The attention surrounding tablets has to be seen in the light of recent years’ uncertainty with regards to multiple structural issues related to digital news consumption, including:

• The newspaper industry’s business models and the possibility of charging for content in electronic channels in the face of falling paper circulation and the unprofitability of ad financed online activities.
• The role already carved out by smartphones and e-readers (e.g. Amazon’s Kindle) and how they affect consumption and the willingness to pay for news content.
• Atomisation of news consumption owing to increased use internationally of news aggregation services – e.g. Google News. On the iPad such services have appeared in the form of aggregation apps like Flipboard.
• The influence of social media on news organisations – as a distribution channel for content and an alternative source for consuming news, but also as a work tool.

While 2010 saw further development in several of these areas, both in the market generally and for NHST Media Group specifically, at the end of the year it was still apparent that it would be quite some time before we know the extent of the consequences.

Internationally, several leading players introduced a paywall for digital content last year. The Times of London (News Corp) and Nikkei launched paywall solutions, the New York Times announced it was going to, while the Financial Times and Wall Street Journal expressed renewed faith in their by now well established paywall solutions. The introduction of paywall models has generally been accompanied by more “channel neutral” management and production of content, often resulting in a greater degree of editorial integration. By far the majority of the newspapers that have launched their own iPad versions so far have done so with the intention of charging readers for the product.

Dagens Næringsliv introduced its own payment service for electronic access to its content in the autumn of 2010, at the same time as the newspaper was made available on the iPad. All the group’s other publications now charge a subscription for digital access to most of their content, including Upstream and Recharge password-protecting most of their online content from October 2010. IntraFish has been using a model based on password-protected digital content for more than 10 years.

The integration of Dagens Næringsliv and DN Nye Media under joint management with effect from September 2010 reflects a growing need to coordinate content resources across channels and that the Dagens Næringsliv brand going forward will be associated to a greater extent with both paid and free digital content .

Growth in the use of smartphones and tablets/e-readers continued in 2010 and has also become important in terms of news consumption. There is a probable link between increased use of smartphones for news updates and a decline in over-the-counter sales of newspapers. At the same time, several newspapers around the globe have succeeded in creating new paid products on the iPad and Kindle, though it is still too early to tell how important this will be as a source of income. Dagens Næringsliv is developing a dedicated solution for the iPad after launching a PDF-based solution in autumn 2010, the first newspaper in Norway to do so. This is also of interest as an alternative distribution solution for the group’s global publications.

The use of various services to aggregate news content from original sources continued on a global basis and led to an important international debate on copyright and the possibility of prosecuting breaches of it. It is clear that most countries’ rules in this area are not adapted to a digital reality in which original content can be copied and aggregated without permission. Whilst news aggregators are not as prevalent in Norway and the specialist global niches in which the group operates, it is important for NHST Media Group as a producer of valuable, paid-for quality content to protect its copyright. Although the launch of the iPad increased optimism regarding the possibilities for creating more restricted digital products for which people are willing to pay, it has also provided an opportunity to create new solutions for the free aggregation of news content, such as Flipboard.

There was further integration of social media by the media houses in 2010, both as a work tool and as new communication channels for their readers. At the same time, leading social media services such as Facebook, Twitter and LinkedIn play an increasingly important role as hubs for the global dissemination of information.

The vigour of social media is also reflected in the growth rate of MyNewsdesk, the group’s operation for disseminating user-generated content from the business community. Owning a majority shareholding in MyNewsdesk (since 2008) has given NHST Media Group a position in social media and brought it great new expertise. MyNewsdesk is Sweden’s leading player in its market and was NHST’s fastest growing business in 2010. MyNewsdesk established solid positions on the Norwegian and Danish markets during the year and has opened an office in Finland. The company also opened an office in Singapore, its first outside Scandinavia, towards the end of the year. The next year will see further international expansion, with use being made of NHST’s existing global infrastructure.

NHST Media Group is meeting the challenges presented by digital development by holding fast to its belief that high-quality, exclusive content is the best basis for continuing to attract loyal readers and advertisers who are prepared to pay. The group seeks to make its content accessible to readers through all channels where there is a willingness to pay.

STRATEGY
Regardless of how business models and distribution channels evolve, interest in business-related news has continued to grow in recent years and there is nothing to suggest that this is about to change. The group bases its strategy on a continued willingness to pay for high-quality, exclusive journalism in attractive business-related niches in the long term.

The most important premise for the group’s activities is therefore that editorial quality and innovation are maintained at the same time as the group focuses on the continued development of new, digital services.

NHST Media Group has very strong market positions, highly skilled employees and a unique Norwegian and global network, giving it the potential to achieve good long-term profitability in the niches where it operates.

The accelerating growth experienced in 2010 was the result of the strategical choice to develop the group’s position in Norway and internationally by maintaining a long-term focus on quality, a strategy that was also pursued in the face of the demanding economic situation of previous years.

The group’s strategy is:

• to be the leading and best provider of business news in Norway
• to be the global leader for shipping, oil/gas, seafood and renewable energy news internationally
• to meet demand for information on the markets where we operate through related information services
• to further develop a global nautical chart business

The group’s Norwegian operations have demonstrated, through innovative, quality-driven developments, that the potential for business news in Norway is much greater than previously assumed. The group’s strategy in Norway is to continue to expand the business both by developing the product range for its existing audience and by capturing the interest of an even wider audience. This will include focusing on the further development of the editorial product for Dagens Næringsliv on paper, online and on new platforms such as the iPad.

Within its international segments NHST Media Group has, over the course of time, shown considerable long-term growth potential, which the company will continue to develop in the years to come. Here too, digital distribution will be increasingly important and there is potential for developing market positions beyond the group’s role as a specialist news provider. The group has employees in 34 offices, with the largest offices outside Norway being in London, Singapore and Houston.

Nautisk Forlag’s chart operations will focus on further international expansion of the business and position the company for a leading role in an industry that will be increasingly characterised by global electronic distribution.

MyNewsdesk has supplemented the group’s traditional editorial strength with the ability to play a leading role in the distribution of user-generated content straight from the business community. So far, an innovative business model and a high level of customer satisfaction have contributed to strong, profitable growth.

Efforts are constantly being made to realise more synergies between the companies in the group in terms of both revenue and costs. This applies in particular to global and Norwegian editorial activities. But there is also potential for further cooperation on the customer side between TradeWinds and Nautisk Forlag, for example. IT and finance are support functions that are handled on a group-wide basis.

RESULTS BY BUSINESS AREA
The group’s companies are organised in four business areas.

The Dagens Næringsliv (DN) area is NHST Media Group’s largest business and accounted for 54 % of consolidated revenue in 2010. DN’s position as Norway’s leading business newspaper strengthened in a year characterised by new growth. Total revenue rose by 12 % to NOK 607.6 million, as against NOK 540.5 million in 2009. Operating profit was NOK 75.1 million, compared with NOK 27.3 million in the previous year.

The main increase in 2010 was in the company’s advertising revenue, which went up by 28 %. This is a reflection of both increased market shares in brand advertising and an improvement in the market for job and property advertisements.

Circulation revenue also continued to rise, showing an increase of 1 %. While subscriptions increased, there was a decline in over-the-counter sales, which is probably attributable for the most part to the increasing use of smartphones for news updates. The magazine D2 continues to develop positively and contributed to advertising growth.

Dagens Næringsliv is well positioned for further growth in 2011.

The Digital & Nordic area comprises the group’s digital activities in the Nordic region. Revenue increased by 18 % during the year from NOK 122.2 million to NOK 144.6 million.

The area had an operating loss of NOK 5.8 million compared with a loss of NOK 16.5 million in the previous year. The negative result reflects the operating losses of Smartcom in particular, which did not manage to turn the negative financial situation round in the course of the year.

DN Nye Medier now shares its management with Dagens Næringsliv and will report under the Dagens Næringsliv business area from 2011.

Within the business area the financial results for each company were as follows:

Revenue at DN Nye Medier, which publishes DN.no, increased by 12 % to NOK 49.3 million. The company had an operating loss of NOK 0.8 million compared with a loss of NOK 10.3 million in 2009. DN.no maintained record traffic levels during the year and increased revenue on the basis of a strong competitive position in an improved advertising market.

TDN’s revenue fell by 6 % to NOK 13.8 million, while its operating profit was NOK 3.5 million compared with NOK 4.5 million last year. The company’s profitability level is high, but a dominant position in a small market limits the potential for new growth.

Europower increased its revenue by 3 % to NOK 21.5 million and had an operating result of NOK 0.1 million compared with a loss of NOK 1.8 million last year. The improvement in revenue and result reflects growth in both the company’s subsidiary, Intstream, and its Norwegian editorial operations.

Smartcom increased its revenue by 2 % to NOK 18.9 million, but had an operating loss of NOK 12.4 million compared with a loss of NOK 10.7 million last year. The unsatisfactory development is due to operational factors, a changing market and the fact that it cost more than anticipated to put the new technical platform in operations.
MyNewdesk increased its revenue by 69 % to NOK 41.8 million, while its operating profit was NOK 4.0 million, as against NOK 1.8 million in the previous year. The company is expecting further growth both in Sweden and beyond in 2011 and is focusing on further international expansion.

The Global area comprises the group’s global publications in the oil/gas, shipping, seafood and renewable energy segments. The area’s revenue was NOK 254.0 million, which is on a par with the previous year.

The area had an operating loss of NOK 9.4 million compared with a loss of NOK 29.2 million in 2009. Better results at IntraFish and Recharge in particular contributed to the improved result.

In this business area the financial results for each company were as follows:

The revenue for TradeWinds, including NHST Events, was NOK 87.0 million, which is on a par with the previous year, while operating profit was NOK 5.3 million, as against NOK 7.9 million in 2009 including a part of the result in NHST Events.

Upstream’s revenue increased by 2 % to NOK 75.4 million, while its operating profit was NOK 4.2 million compared with NOK 1.9 million in 2009.

IntraFish Media’s revenue fell by 8 % to NOK 82.2 million, while operating profit was NOK 2.4 million, as against an operating loss of NOK 13.0 million in 2009. Both the fall in revenue and improved result are due to a restructuring of the product portfolio and organisation. NHST Media Group acquired the remaining 40 % of the shares in IntraFish in February 2011.

Recharge increased its revenue by 168 % to NOK 9.8 million and had an operating loss of NOK 17.8 million, as against an operating loss of NOK 23.2 million last year.

The Nautical Charts area consists of Nautisk Forlag. The business progressed, mainly as a result of increased sales in its Asian division. The company’s revenue increased by 9 % to NOK 110.2 million in 2010. Its operating profit was NOK 6.2 million compared with NOK 3.2 million in 2009.

GOING CONCERN
The accounts have been prepared on the basis of a going concern assumption. This assessment is based on the group’s expectations for 2011, satisfactory liquidity position and undrawn credit facilities. The Board of Directors believes that the financial statements provide a fair presentation of NHST Media Group’s assets and liabilities, financial position and results.

EXTERNAL ENVIRONMENT
The group does not produce goods or services that use environmentally hazardous input factors. Dagens Næringsliv, the one newspaper owned by the group that has appreciable over-the-counter sales, collects unsold newspapers through AS Avisretur. The newspapers are then sent for recycling. All office machines that are taken out of service are dealt with in accordance with regulations. All the newspapers buy printing services from external suppliers. The environmental awareness of the group’s main suppliers has been assessed and found to be satisfactory.

EMPLOYEES AND WORKING ENVIRONMENT
The working conditions are considered to be good and the group attaches importance to health, safety and environment activities organised by the working environment committee, the sports and recreation organisation and HR. Cooperation with the employees’ organisations has been satisfactory.

The sick leave absence rate for the group in Norway was 3.6 % in 2010, down 1.1 % on 2009. The sick leave absence rate for the parent company, NHST Media Group AS, was 1.9 %, down 2 % on 2009. Globally, including Norway, the sick leave absence rate for the group was about 3 %. The group is constantly working to reduce the sick leave absence rate. No injuries or accidents were reported during the year.

NHST Media Group has employees in more than 30 offices in Norway and abroad, with the largest offices outside Norway being in London, Stockholm, Singapore and Houston. Many nationalities are represented in both Norway and abroad, and the employees work well together. The group has a recruitment and HR policy that ensures equal opportunities and rights, while preventing discrimination.

EQUALITY OF STATUS AND EQUAL OPPORTUNITIES
In 2010 NHST Media Group had an average of 632 employees (604 full-time equivalents), 227 of them women. There were 586 full-time employees. At the end of the year there were 657 employees.

At the end of 2010 the group’s Board of Directors had five members elected by shareholders, two women and three men. The group’s administrative management consisted of one woman and three men in 2010. All the subsidiaries, with one exception, are headed by men. The proportion of women in middle management is 32 %.

When recruiting, the group looks for the person best qualified for the job. NHST Media Group believes that good gender distribution contributes to a better working environment, greater creativity and flexibility, and better results in the long run. All other things being equal, preference will be given to a person of the underrepresented gender. The group has an active approach to equality of status and equal opportunities.

NHST Media Group’s HR policy is based on equal pay for equal work. This means that women and men have equal pay in equal positions, provided that other factors and their performance are equal.

The group tries to make it possible for employees of either gender to combine work and private life. During 2010 a total of 43 employees had leave of absence, 17 of them women.

NHST Media Group had 51 part-time employees in 2010, 32 of them women. In positions where it is feasible in practice, the group has made it possible for employees to work part-time. Women are represented to a higher degree than men among employees working part-time and taking sick leave. This is considered to be mainly due to women continuing to take greater responsibility for caring for children and family in society. On the other hand, more men than women had leave of absence in 2010.

RESEARCH AND DEVELOPMENT
The group does not have any research and development expenses. It nevertheless commits substantial resources to developing its activities in digital technologies and publishing platforms. This is a constant area of focus and some of these costs are recognised in the balance sheet as development costs linked to the group’s electronic publishing and production platforms and classified as intangible assets. As at 31.12.2010 such costs had a book value of NOK 29.4 million, compared with NOK 38.9 million last year. Such costs are normally depreciated over 3 to 5 years.

CORPORATE GOVERNANCE AND COMPANY MANAGEMENT
NHST Media Group strives to follow the recommendations of the Oslo Stock Exchange with regard to good corporate governance and company management. An account of central factors and any departures follows.

Every business depends on good relations if it is to succeed. A good reputation and good financial development are prerequisites for building and maintaining confidence among important stakeholder groups such as shareholders, customers, employees, suppliers, partners and public authorities. This requires that the company be managed using good control and management mechanisms. Open, honest communication and equal treatment of the company’s shareholders are also important when it comes to increasing shareholder value and inspiring confidence. The company has annual rolling four-year strategic plans, an annual budget and comprehensive rules for journalism activities, as well as providing supplementary information in the annual report on other matters relating to corporate governance and company management. In addition, the company has rules for the Board of Directors and the CEO. See also the rest of the account.

Operations
The object of the company is set out in the Articles of Association, while its goals and strategies are described in the annual report.

Equity
NHST Media Group AS has share capital of NOK 12,879,250. Equity stood at NOK 115.0 million as at 31 December 2010, i.e. an equity ratio of 24 %. The equity ratio for the group was 28 %.

Dividend
NHST endeavours to be financed through equity and aims to offer a competitive return on its shares in the form of price rises and dividends. When assessing the size of the dividend, the Board of Directors attaches importance to the company’s dividend capacity, the requirement for adequate equity and the need to have sufficient financial resources for future development. A dividend of NOK 10 million, equivalent to NOK 7.76 per share, is being proposed to the General Meeting for 2010.

Share issues
There were no share issues in 2010 and no further share issues are proposed.

Treasury shares
Holdings of treasury shares were unchanged in 2010. Holdings consist of 44,752 treasury shares.

Equal treatment of share-holders and transactions with related parties
The company’s General Meeting is open to all approved shareholders and all approved shares carry equal voting rights. All shareholders may attend in person or by proxy. It is not possible to attend and/or vote via the Internet. There are no known shareholders’ agreements. The General Meeting is convened with the statutory minimum notice.

Negotiability
There is just one class of shares and each share carries one vote at the General Meeting. The shares are freely negotiable, though the Board of Directors may refuse to allow a share transfer on reasonable grounds. The right to refuse consent for the acquisition of shares is based on the need for editorial and commercial independence.

General Meeting
The documents for the General Meeting, including the recommendations of the election committee, are sent to share-holders no less than two weeks before the General Meeting is held. Importance is attached to the documents containing the information necessary for the shareholders to be able to decide on the business on the agenda. According to the Articles of Association, the Chairman of the Board of Directors chairs the General Meeting.

Committees
The nomination committee was elected by and from among the members of the Board of Directors for reasons of expediency. The group has a compensation committee consisting of three Board Members.

Corporate Assembly and Board of Directors – composition and independence

NHST Media Group AS does not have a corporate assembly.

NHST Media Group aims to balance the composition of its Board of Directors so that it takes account of expertise, experience and background relevant to the company’s activities and represents the composition of shareholders. The company’s management is not represented on the Board of Directors. There are no family ties with the General Manager or other senior employees. Performance-related directors’ fees are not used. The Board of Directors normally consists of five representatives elected by shareholders. All representatives are elected for two years at a time on a rotating basis. In 2010 three of the Board Members elected by shareholders had direct or indirect shareholdings in the company (see note 16). None of the Board Members has significant business relations with the company.

Work of the Board of Directors
The Board of Directors regularly receives a group reporting package containing financial information on the group and the individual group companies. The Board also regularly receives management’s comments on developments during the year. The company’s strategy is discussed on a broad basis at an extended Board Meeting every year. There is also a rotating review of subsidiaries at individual Board Meetings. The work of the Board of Directors is evaluated annually.

Risk management and internal control
The group is exposed to various types of financial risk linked to ordinary operations. In the short term this involves unpredictable advertising markets in particular, but also technical business interruptions and distribution. The group therefore has comprehensive systems in place for monitoring and dealing with such situations. The group is exposed to risks associated with operations in several foreign currencies. This risk is assessed continuously, in addition to which the group has a set policy of hedging approximately 50-70 % of its net anticipated surplus liquidity in the most important currencies for 12 months ahead every November/December. Hedging as at 31 December is described in detail in the notes to the accounts. The group has a relatively wide-spread customer portfolio, on which it runs a credit risk, but it also has credit insurance for some large customers. During 2010 the group continued to focus on outstanding receivables and the Board of Directors judges the risk of significant losses to be relatively small.

Board remuneration
The General Meeting fixes remuneration for the Board of Directors every year. In 2010 the total remuneration paid to the Board of Directors was NOK 945,000. In May 2010 the General Meeting fixed directors’ remuneration at NOK 175,000 for the Chairman of the Board of Directors and NOK 110,000 for each of the other Board Members (reduced in proportion to attendance at Board Meetings).

Remuneration of senior employees
NHST Media Group attaches importance to being an attractive employer. The company wants to attract skilled employees with relevant experience. The company therefore aims to have a competitive remuneration system.

Information and communication
NHST Media Group endeavours to provide good, correct information externally every quarter, with information being given to shareholders on an equal basis. Reports and announcements are also available on NHST’s website at www.nhst.no.

The company does not make specific assumptions about future revenue and profits. NHST’s shares are listed in the OTC list in Oslo (stockbrokers’ list of unlisted shares) and the share price is listed daily under “Børs og marked” in Dagens Næringsliv. At the turn of the year the share price was NOK 395.

Company takeover
The company has no defence mechanisms against possible takeover bids in its Articles of Association. Nor has it prepared guidelines for how the company would act in the event of a possible takeover bid.

Auditor
The company uses the same firm of accountants for all its subsidiaries on all the markets where it is active with the exception of Sweden and Finland. The overall auditing quote is discussed and approved by the Board of Directors and CEO. The auditor is not used as a consultant for strategic matters. The CFO approves any consultancy assignments.

The auditor attends the Board Meeting at which the financial statements are discussed. The auditor’s remuneration is reported at the General Meeting and described in the notes to the accounts.

PROSPECTS FOR 2011
The order book for advertising in particular indicates that the group will maintain a good growth rate into 2011. The group will focus on further improving its profit margin.

The group’s competitiveness is expected to be good. Most of its publications occupy leading market positions that were maintained or reinforced during 2010.

Continued growth is expected in most of the markets where the group operates in the coming year, while several structural factors to do with the media industry and its business models remain uncertain. Digital products are expected to account for an ever larger proportion of revenue.

The macroeconomic picture looks more stable and positive than at the start of last year, but there is still uncertainty surrounding the international economy.

PROFIT FOR THE YEAR AND DISTRIBUTION
The parent company is a holding company that in 2010 had revenue of NOK 70.9, most of which related to group services. This is NOK 2 million less than last year. It made an operating loss of NOK 24.4 million, as against a loss of NOK 23.2 million in 2009. Net financial items were NOK 45.1 million compared with financial costs of NOK 14.1 million in 2009. The large fluctuations in net financial items from year to year are caused by the level of group contributions received from subsidiaries. The book tax expense for the year was NOK 6.0 million, while net tax payable is NOK 3.3 million. It is proposed that NHST Media Group AS’s profit for the year after tax, which is NOK 14.7 million, should be distributed as follows:

(NOK ’000):
Dividend 10 000
Transferred to retained earnings 4 704
Total distributed 14 704

The non-restricted equity of NHST Media Group AS is NOK 49.0 million. Total equity is NOK 115.0 million compared with NOK 110.3 million in 2009, while the equity ratio is 24 % compared with 28 % last year.