Quarterly report third quarter 2006

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Overall

The Norges Handels og Sjøfartstidende (NHST) Group’s profit before tax for the third quarter amounted to MNOK 6.0 as against MNOK -1.7 last year. The operating profit was MNOK 5.0 as against MNOK -2.4 last year. The third quarter is normally the slackest quarter due to the holiday period in Northern Europe and the way in which holiday money is expensed. Accumulated after nine months the result before tax is MNOK 63, which is 49 % better than last year (MNOK 42.5). The operating profit improved by 54 % to MNOK 62.3.

The NHST group turnover increased by 17 % during the quarter to MNOK 198.6. The growth in turnover is considered to be greater than the market growth, which means that the positive sales trend that has been typical for NHST during the last 12 quarters continued through the third quarter. After the first nine months, turnover was MNOK 626.4, up 17 % compared to last year. On the whole the market situation is still good, both in Norway and in the three global niches shipping, oil and seafood. The main reason for the growth in turnover is the increase in the turnover of advertisements but there is also good growth in the circulation revenues. On the whole the advertisements turnover is up around 29% at group level whereas circulation revenues are up around 8%.

As opposed to a lot of other media companies, NHST is able to report increased circulation and record circulations for all NHST’s newspapers with one exception only, namely the newspaper Fiskaren, which saw a slight decline. The Board is of the opinion that the newspaper upswing is thanks to very competitive concepts and the will to invest in newspapers. The growth on the advertisements side is apparent both in “Appointments” and in general profile-promoting advertisements. Moreover, NHST is showing strong growth both in internet advertisements and in internet traffic – both with a growth of 30-60%, depending on the publication. There is considerable business planning going on both for the existing publications and for new activities. Several new internet-based services will be launched soon – such as dnEnergi.no. The global conference activities have now been pooled under the company NHST Events, while the editorial web TV has been pooled under the company DNTV.

This report has been prepared according to NGAAP (Generally Accepted Accounting Principles) – as previously.

Publication by publication

Dagens Næringsliv (DN) improved its profit by 163 % to MNOK 9.4 during the quarter.
Total income increased by 18% during the quarter to MNOK 116.1. Revenues from circulation increased by about 10% and advertisement revenues increased by about 30%. Particularly “Appointments” adverts and profile-promoting business advertisements grew considerably. Both as regards circulation and advertisements the trend confirms that DN is capturing market share in the readership and advertisements markets. DN’s circulation is up about 2,000 compared to the corresponding period of last year and there is an extensive circulation campaign going on at the moment. Accumulated for the first nine months of the year DN’s turnover was MNOK 369.3 – up 17%. The operating profit increased 50% to MNOK 65.1.

DN Nye Medier had an operating loss of MNOK 0.4 as against a loss of MNOK 0.7 last year.
DN Nye Medier’s turnover increased by 27% during the quarter, to MNOK 7.7. Underlying for developments in both profit/loss and turnover is a better development. This is because more contact with customers is higher up on the list of priorities, which will improve results even further during the fourth quarter 2006. The growth in traffic is some 30%. Accumulated after nine months the operating profit is MNOK 2.4 as against MNOK 0.7 last year. Turnover is up 37 % to MNOK 27.2. In association with dn.no, dn-søk, dntv and dnEnergi will be launched during the fourth quarter.

TradeWinds had an operating profit of MNOK 0.2 as against MNOK 0.1 in the third quarter of last year.
Turnover increased by 10 % to MNOK16.4. The growth in turnover has particularly emanated from ”Appointmements” adverts. Circulation is at an all-time high at 7,916, and the growth experienced in China and Greece is still the greatest contributor. After nine months the operating profit is MNOK 4.1 as against MNOK 2.4 last year. Turnover was up 4 % to MNOK 53.8.

Upstream’s operating profit was MNOK 1.7 as against MNOK 0.4 in the third quarter of 2005.
The improvement was primarily due to increased advertisement revenues. Turnover for the quarter was up 23% to MNOK 17.2. Accumulated for the year, the operating profit stood at MNOK 2.5 as against MNOK 1.4 last year. Turnover was up 15% to MNOK 47.1. Circulation was at an all-time high at 6,332. It is the growth emanating from the US and Western Europe that is the biggest contributor to the circulation growth.

Intrafish Media had an operating loss of MNOK 0.8 as against a loss of MNOK 1.4 during the third quarter of last year.
Turnover grew during the quarter by 12 % to MNOK 12.0. It is the advertisements turnover that grew the most, particularly advertisements from Continental Europe and the US. This also reflects the increased industrialisation in the industry. After nine months, the operating result was MNOK -1.1 as against MNOK -2.7 last year. Turnover increased by 15% to MNOK 36.7.

Nautisk Forlag had an operating profit for the quarter of MNOK 1.9 as against MNOK 0.7 last year.
Turnover was up 2 % to MNOK 21.6. It was the increased sales to the leisure craft segment that contributed to the growth in turnover. Nautisk Forlag has now established a separate sales office and a shop in Singapore as well as other NHST activities there. The accumulated operating profit was MNOK 5.7 as against MNOK 5.9 last year. Turnover increased by 4 % to MNOK 68.1.

Europower had an operating loss of MNOK 0.9 for the quarter, which was identical to that of last year.
The turnover for the quarter dropped from MNOK 3.8 to MNOK 2.5. The drop in turnover was due to one-off accounting effects from the acquisition last year of Energi Forlag. The accumulated operating loss was MNOK 2.8 as against an operating loss last year of MNOK. Turnover increased by 12% to MNOK 8.1.

TDN Nyhetsbyrå had an operating profit of MNOK 0.7 compared to MNOK 0.4 for the fourth quarter of last year.
Turnover increased by 14% to MNOK 3.0. It is the growth in the number of customers that contributed to the growth in turnover. The accumulated operating profit was NOK 2.0 as against MNOK 1.0 last year. Turnover increased by 16% to MNOK 8.6.

Other new activities such as web TV, dagens it (current IT), søk (search), NHST Events etc. had a loss of MNOK 2.7 in the quarter. There were no such activities last year. The turnover for those activities was MNOK 3.5. Accumulated these activities have had a deficit of MNOK 5.4 to date. The turnover was MNOK 11.6 after nine months.

In conclusion: The third quarter passed satisfactorily with good progress having been made for the established publications and for several new initiatives. The general boom is continuing and is expected to continue as such in the immediate future. The order situation is good and the publications have good market positions. In the short term, therefore, further progress is expected.

26th October 2006

The Board of Directors of AS Norges Handels og Sjøfartstidende