11Annual Report
Contents
3 Foreword
97 Report of the Supervisory Board
6 Executive Board
104 ullstein bild
8 Attractive Employer
114 Consolidated Financial Statements
115 Responsibility Statement
116 Auditor’s Report
117 Consolidated Statement of Financial Position
118 Consolidated Statement of Comprehensive
Income
119 Consolidated Statement of Cash Flows
120 Consolidated Statement of Changes in Equity
122 Notes to the Consolidated Financial Statements
170 Boards
172 Glossary
26 The Axel Springer share
29 Employees
32 Social responsibility
34 Combined Management Report
35 Business and framework conditions
50 Financial performance, liquidity,
and financial position
67 Economic position of Axel Springer AG
69 Events after the reporting date
70 Report on risks and opportunities
77 Forecast report
81 Disclosures and explanatory report of the
Management Board pursuant to takeover law
85 Corporate Governance Report
Group Key Figures
Digital Media revenues as percent of total revenues (pro forma)
30.9 %
27.4 %
-
-
-
International revenues as percent of total revenues
32.9 %
28.1 %
21.0 %
21.9 %
20.8 %
Circulation revenues
Advertising revenues
Other revenues
EBITDA margin1)
Consolidated net income
Consolidated net income, adjusted2)
Newspapers National
Magazines National
Print International
Digital Media
Services/Holding
Newspapers National
Magazines National
Print International
Digital Media
Services/Holding
Free cash flow3)
Capex4)
Total assets
Equity ratio
Net debt/liquidity
Earnings per share6)
Earnings per share, adjusted2)6)7)
Dividend8)
Year-end share price
2.6 %
1,204.5
1,174.3
1,176.2
1,215.8
1,190.6
16.0 %
1,606.8
1,384.8
1,138.5
1,248.1
1,207.5
11.6 %
5.6 %
21.2 %
373.5
334.8
296.9
264.7
179.8
18.6 %
17.6 %
12.8 %
17.8 %
18.2 %
289.4
343.3
274.1
283.2
313.8
152.6
571.1
254.6
– 288.4
234.6
– 2.4 %
1,164.9
1,194.2
1,213.7
1,277.6
1,290.3
– 3.7 %
18.1 %
35.2 %
15.3 %
– 4.5 %
2.2 %
20.0 %
84.2 %
-
468.1
473.5
962.1
116.2
282.7
103.2
73.8
158.1
– 24.4
– 1.8 %
293.9
-
– 112.7
486.1
400.9
711.8
100.8
296.0
101.0
61.5
85.8
517.8
311.7
470.4
98.1
564.1
409.8
378.2
99.0
587.8
408.3
208.1
83.4
243.8
348.9
363.9
55.0
12.3
43.2
– 33.7
– 20.5
299.3
– 59.2
231.3
– 38.9
88.8
27.8
20.9
– 0.2
219.7
– 46.7
73.9
10.6
36.7
– 15.1
238.7
– 58.8
16.2 %
4,187.5
3,603.2
2,934.3
2,809.1
3,826.9
-
– 4.0 %
16.9 %
6.2 %
46.1 %
49.2 %
40.8 %
38.0 %
31.7 %
– 472.8
79.6
– 193.0
– 369.5
– 743.1
2.62
3.03
1.70
2.73
2.60
1.60
3.40
1.42
1.47
6.18
2.44
1.47
– 3.23
2.25
1.33
– 18.3 %
33.21
40.67
25.02
17.13
32.67
Market capitalization as of December 319)
– 18.1 %
3,274.7
3,999.2
2,236.5
1,525.4
2,998.8
Free float
41.1 %
40.8 %
23.5 %
23.1 %
26.2 %
2011:
69 % Print
31 % Digital 1)
2004:
98 % Print
2 % Digital
1) Pro forma for acquisitions.
Axel Springer is one of Europe’s leading integrated
multimedia companies with a broad spectrum of
print and digital offerings. Our long-term strategy
has been successful, so it remains unchanged: to
generate revenues that are evenly balanced between
print and digital media channels.
2011:
69 % Print
31 % Digital 1)
Our Goal:
50 % Print
50 % Digital
Zippert zappt
The digitization of media con-
tinues, newspapers are the
VHS cassettes of tomorrow,
and so it is only natural that we ask
ourselves: What will we use to wrap
fish in the future, and how can we get
streak-free windows if newspapers
are no more? The paper-recycling
industry is facing ruin, the paperboy
has been plastinated and put on
display in the history museum. Of
course, this trend also has its draw-
backs. It’s a lot more expensive to
swat annoying insects with an iPad.
A single mosquito can easily cost you
€ 600. And let’s not even talk about
stuffing wet galoshes with e-books.
What will private detectives and
secret agents hide behind? What’s
a husband supposed to do at the
Sunday breakfast table – speak with
his wife? Or is there an app for that?
These things are scarcely imaginable
today, but progress cannot be halted.
Men with hair loss will be showing
off the latest flat panel displays. Sev-
enty percent of our politicians will
already have a built-in recall button.
And 50 percent of the Management
Board of Axel Springer AG will be
digitized in just two years, while the
rest will, at the very least, be working
in full wireless mode.
Publicist and satirist Hans
Zippert has been writing the
daily column “Zippert zappt”
for DIE WELT since 1999.
“Zipperts TV-WELT” has
appeared weekly in HÖRZU
since 2009.
Foreword 3
We have two good reasons to celebrate. First, Axel
Springer AG just set a new company record for financial
performance with EBITDA of € 593 million for fiscal year
2011. Second, we are celebrating the 100th birthday of
our company founder, who was born on May 2, 1912.
Axel Springer is more than an historical figure; he is an
integral part of our company’s present and future. The
success of Axel Springer AG is and always has been
closely tied to his personality and values. Axel Springer
gave this company a culture that is rooted in innovation,
entrepreneurial courage and fidelity to core principles. It
was this culture that motivated us to digitize our business
early on—overcoming inertia, skepticism and resistance
in the process. In 1978, Axel Springer said the following:
“I will not cease to encourage publishers to play a role in
the existing electronic media, and even more to play a
role in all the new information systems that are headed
our way.”
Ten years ago, when a new management team took the
helm of our company, we laid out our digitization strate-
gy. It could not have been simpler, and it remains in
effect today: in all our online activities, we remain true to
the core competencies that made us successful in the
past decades. This means:
(cid:1) We create strong content and brands through portals
such as Bild.de, WELT ONLINE, and aufeminin. Our
portals increased their market share in 2011 through
the acquisition of Netmums by aufeminin and the
launch of Stylebook by Bild.de, to cite just two exam-
ples. We also made good progress towards the goal
of establishing paid content for smartphones and tab-
lets, derived from our media brands.
4
Annual Report 2011 Axel Springer AG
In many discussions, I sensed that this particular devel-
opment above all has again heightened the interest in
our company. Everybody knows that we have a stable
print business that has been highly profitable for many
years, with EBITDA margins of more than 20 % in Ger-
many. In addition, we have a digital business that contin-
ues to grow rapidly, registering organic growth of 20.6 %
over the prior year in 2011 alone. But the most important
factor, the one that creates measurable added value, is
the combination of a strong print business with a strong
digital business under one roof. The Internet companies
we have invested in are performing better than compa-
rable companies that stand on their own. (In fact, we’re
doing so well that the Supervisory Board and Manage-
ment Board proposed a dividend of € 1.70 per share for
financial year 2011. That corresponds to € 5.10 before
the stock split, making it the highest dividend ever paid
by Axel Springer AG.)
If you trace the source of our company’s success, the
search invariably leads back to the life and work of our
founder, Axel Springer. He was guided by a moral com-
pass that drove him to discover and then do what he
considered to be the right thing. The same philosophy
that guided his political views and actions also guided his
business decisions and the management of his publish-
ing house.
(cid:1) We use the wide reach of our media products to
establish profitable classified ad marketplaces; for
example, we have founded or acquired strong online
classified ad portals such as StepStone and immonet
in prior years, as well as the French portals SeLoger
and AutoReflex in the past year.
(cid:1) We market mass reach values to our advertising
customers. In the digital sphere, that primarily means
investing in online marketers. In 2011, we extended
our leading position in Europe in the performance-
based marketing segment by acquiring the Dutch
affiliate network M4N, and by introducing the zanox
Group to new international markets. Also, thanks to
our acquisition of kaufDA, we are now well positioned
in the fast-growing market for online brochures, cou-
poning, and local shopping.
In 2002, we generated less than 2 % of our revenues
online. In 2011, for the first time, revenues from digital
media accounted for more than 30 % of total Group
revenues. In absolute terms, we have nearly reached the
€ 1 billion mark in revenues from our digital business.
These activities are also highly profitable (with an EBITDA
margin of 16.4 %). Based on revenues, Axel Springer AG
is now the second-ranked European stock listed Internet
company. With a reach of 63.7 million unique visitors,
Axel Springer AG is the leading online operator among
traditional European media companies. Among the most
popular European websites, including Google, Facebook,
Amazon and eBay, Axel Springer ranks 16th, which is
amazing in itself! I consider yet another development last
year to be particularly impressive: Digital advertising reve-
nues nearly caught up to the advertising revenues of our
national and international print media for the full year 2011.
Foreword
5
“Axel Springer gave this company
a culture that is rooted in innovation,
entrepreneurial courage and fidelity to
core principles.”
In nearly all important matters, Axel Springer stood for
values that were exactly opposed to the “zeitgeist” of his
day. But even his fiercest critics concede his substantive
legacy: Springer advocated for the reunification of
Germany. Springer lobbied for Berlin to be the capital of
Germany. And Springer wanted to be free of Soviet
communism. Today, Berlin is the capital of a reunified
Germany, the Cold War is over, and all that remains of
communism are some bitter hold-outs in Cuba and
North Korea.
I never met Axel Springer personally. Yet looking back at
his life, I see a hero—not one with superhuman strength,
but one who wrestled with human weaknesses. And
when it mattered most, he overcame his doubts and
fears. That is his most important achievement. I believe
Axel Springer derived his strength from combining two
things many people try to separate: intuition and intellect.
He had the courage to trust and live his feelings. He
recognized that what our gut tells us is sometimes more
“right” than what our supposedly infallible reason says.
Credibility, fidelity to principles, innovation spirit. These
values of Axel Springer are still in evidence today—for
our readers, our advertising customers, and our users.
And for you, our shareholders. They continue to motivate
the company’s employees, who deserve our gratitude for
their outstanding work.
A quarter century after his passing, the spirit of Axel
Springer continues to thrive, both in this company and
beyond.
Sincerely yours,
Mathias Döpfner
6 Executive Board
Dr. Mathias Döpfner
Rudolf Knepper
Lothar Lanz
Chairman
Born 1963, journalist.
Career milestones:
Frankfurter Allgemeine Zeitung,
Gruner+Jahr; Chief Editor
Wochenpost, Hamburger
Until the end of 2011
Vice Chairman as well as
President Printing, Logistics,
and HR
Chief Financial Officer and
Chief Operating Officer
Born 1948, Master’s degree
in commerce.
Born 1945, Master’s degrees
Career milestones:
in engineering and in business/
Bayerische Hypotheken- und
Morgenpost, and DIE WELT.
engineering.
Wechselbank AG; member of
Member of the Executive
Career milestones (since 1973
the Executive Board at HSB
Board since 2000, Chairman
with Axel Springer): Head of
HYPO Service-Bank AG;
since 2002.
Corporate Planning Office
member of the Executive Board
for Printing; Manager of the
at Nassauische Sparkasse;
Hamburg Printing Plant;
member of the Executive Board
Head of Production Newspaper
and Chief Financial Officer at
Printing; Member of the
ProSiebenSat.1 Media AG.
Executive Board 1994–2011,
Member of the Executive Board
Vice Chairman 2002–2011.
since 2009.
Executive Board
7
Dr. Andreas Wiele
Jan Bayer
Ralph Büchi
President BILD Group
From 2012 President WELT Group
From 2012 President International
and Magazines
and Printing
Division
Born 1962, lawyer.
Career milestones:
Born 1970, Master’s degree in
Born 1957, business economist.
media studies. Career milestones:
Career milestones: Editor
Editor, Hamburger Morgenpost;
Süddeutsche Zeitung; Publisher
Handelszeitung; Chairman of
Head of Publishing Capital and
Volksstimme, Magdeburg;
the Management Board of the
Geo, Gruner+Jahr, Paris/France;
Publisher Süddeutsche Zeitung;
Handelszeitung publishing group;
Executive Vice President and
Chairman of the Management
CEO Axel Springer Schweiz AG;
Chief Operating Officer of
Board of the WELT Group.
President of Axel Springer
Gruner+Jahr USA Publishing,
Member of the Executive Board
International. Member of the
New York.
from 2012.
Executive Board from 2012.
Member of the Executive Board
since 2000.
8 Attractive Employer
There’s more to it for people who
grow beyond their usual employment
profile. In 2011, our new employer
brand appeals to all target applicant
groups for the first time ever.
The motifs feature real employees
from various sectors – because
Axel Springer offers professional
development opportunities to fit
a wide range of career fields.
9
Axel Springer was quick to recognize and capi-
talize on the tremendous market opportunities
of the digital revolution. At the same time, the
company transformed its corporate culture.
Based on this self-conception, we use wit and
a healthy dose of self-deprecation to position
Axel Springer as an attractive employer.
The ad series on the following pages give an
impression thereof. Our company’s founder
fits into this series perfectly, as you can see
for the first time on page 24.
We launched the campaign with a YouTube
video that was quite a hit, by the way.
See for yourself:
www.axelspringer.de/media-entrepreneurs
Chief Technology Officer with
Say Whaaat?! Capabilities for Cross-
Channel Hammer Innovations
Ulrich Schmitz
Electronic Media
Content Portals
Online Marketplaces
Online Marketing
Our digital business is focused on our three core
competencies – content portals, online marketplaces,
and online marketing – which we continue to grow
organically and through acquisitions.
See pages 37, 47 and 59 to learn more about our
digital media.
BILD is Europe’s largest daily newspaper, with a
commanding lead on Germany’s newsstand market.
BILD.de has a more comprehensive reach than any
other German-language information and entertain-
ment portal. The BILD apps for mobile devices are
regularly among the top sellers in download stores.
A multimedia success story.
More information on BILD can be found on
pages 35, 53, and 59.
Management Trainee with
Funk-A-Delic Specialization for
BaDaBoom Media Reinvention
Michael Moersch
Bild.de
Simone Loesch
Axel Springer Media Impact
Senior Manager Digital Marketing
with Boyakasha Electronic Beats
for Top-Strike Media Impacting
When it comes to brand and reach – whether in print
or digital media – we can speak to advertisers in a
language they understand. Our central marketing
entity Axel Springer Media Impact is an important part
of this, as are our performance-oriented marketing
firms such as zanox and Digital Window.
See pages 40 and 62 to learn more about our
marketing activities.
The WELT Group’s integrated newsroom works
around the clock processing news and stories for
various media channels – print, online, and mobile
devices. This makes the WELT Group the first
newspaper brand in Germany to be represented
on all the relevant digital platforms of iOS, Android,
and Kindle.
More about the WELT Group can be found on
pages 35, 53 and 59.
Robert Hiersemann
WELt OnLInE
Vocational Student in Digital and
Print Media with Libero-Excellence
for Supreme A+ Media Über-Action
Lars Haider
HAMBURgER ABEndBLAtt
Editor-in-chief with Local Spirit
Overdose for Boom Shake The
Room Happiness Responsibility
We published an iPad app as well as reaffirmed
our local expertise with the special Hamburg apps
“Bike Tours” and “Journey Back in Time” and the
local reporter app “My Neighborhood”: it was a
creative year for HAMBURGER ABENDBLATT. We
also launched a successful partnership with kaufDA,
the digital brochure content provider that was re-
cently acquired by Axel Springer.
More information on HAMBURGER ABENDBLATT
can be found on pages 54, 60 and 62.
AUTO BILD, Europe’s biggest automotive magazine,
reports all the latest, fascinating, and surprising facts
related to automobiles, week after week. And it does
that on all media channels. In addition to the tradi-
tional print issue of the magazine, as well as the
websites autobild.de and autobild.tv, the successful
AUTO BILD brand is now being extended into the
digital world via premium apps as well.
See pages 36, 55 and 60 for more information
about AUTO BILD.
Boris Pieritz
AUtO BILd
Executive Editor with
Quadruple Crossmedia Strength
and Futurama Tablet Experience
Axel Springer and national
subsidiaries
International subsidiaries
of Axel Springer
Licenses, holdings, and
joint ventures
Finnland
Estland
Lettland
Litauen
Russland
Weißrussland
Ringier Axel Springer Media AG
Ukraine
Dänemark
Dänemark
Groß-
britannien
Niederlande
Niederlande
Deutschland
Belgien
Polen
Polen
Frankreich
Tschechische
Tschechische
Republik
Republik
Portugal
Spanien
Slowakei
Slowakei
Ungarn
Ungarn
Schweiz
Österreich
Slowenien
Slowenien
Kroatien
Italien
Rumänien
Aserbaidschan
Aserbaidschan
Serbien
Serbien
Montenegro
Montenegro
Bulgarien
Mazedonien
Griechenland
Griechenland
Türkei
Axel Springer is represented beyond Germany’s
borders through subsidiaries, joint ventures, and
licensing agreements with more than 190 newspapers
and magazines. Our key sales markets are in eastern
Europe, and our Ringier Axel Springer Media joint
venture has made it possible to actually expand our
presence and portfolio there.
See pages 36, 41 and 56 to learn more about our
international activities.
Analyst Business Development
with Cross-Cultural Power for
Ultra Flip-Out Market Boosting
Susanne Mithöfer
Axel Springer International
Axel Springer
Publisher
Company’s Founder with Boom-
Creative Vision Qualities and Splash!
Journalistic Excellence Boost
Company’s Founder with Boom-
Creative Vision Qualities and Splash!
Journalistic Excellence Boost
Journalist
Entrepreneur
Freedom-fighter
As a passionate journalist, bold entrepreneur, and
visionary freedom-fighter, Axel Springer defined this
company and accompanied the emergence of our
democracy: fascinating, controversial, and polarizing.
For more on the life of a man who experienced
and influenced so many momentous events, visit
meilensteine.axelspringer.de (available in German only).
26 Annual Report 2011 Axel Springer AG
The Axel Springer share
26
The closing price of the Axel Springer share on the final
trading day of 2011 was 18.3 % less than the corres-
ponding year-ago price. Thus, our share exhibited a
similarly sharp decline as the DAX and underperformed
the MDAX, in which the Axel Springer share has been
listed since September 2010, by nearly 5 %.
Difficult year for stock markets
The stock markets were characterized by massive tur-
moil last year, especially starting around mid-2011. The
high debt levels of some European national governments,
the resulting euro crisis, as well as the enormous gov-
ernment debt of the United States, led to considerable
volatility in the financial markets. Leading stock market
indexes finally staged a mild recovery in the fourth quar-
ter, but remained consistently below their respective
levels at the start of 2011. Thus, the DAX lost 17.5 % and
the MDAX lost 13.8 % of their respective values in 2011.
Media sector indexes also exhibited a negative trend,
with the German sector index Prime Media falling by
14.9 % and the DJ EuroStoxx Media Index by 16.5 %.
Comparison Total Market
Axel Springer
1)
DAX
MDAX
1)
Axel Springer share: after losing ground,
significant recovery towards the end of
2011
The Axel Springer share underperformed the relevant
comparison indexes for much of 2011, but recovered
significantly in the final quarter of the year. The share
started the year at € 40.67 and reached its high for the
year of € 41.67 on January 18, before declining steadily
thereafter to plumb its low for the year of € 24.50 on
October 4. After that, the share price moved back up,
but the closing price of € 33.21 on December 30, 2011
was still well below the high for the year. At year-end
2011, the company’s market capitalization was
€ 3.3 billion.
Index Comparison Media
Axel Springer
Prime Media
1)
DJ EuroStoxx Media
1)
50
40
30
20
Year-end share price: € 33.21
01|01|11
12|30|11
1)
Indexed on the year-end share price of Axel Springer AG as of December 30, 2010.
Year-end share price: € 33.21
€
50
40
30
20
01|01|11
12|30|11
1)
Indexed on the year-end share price of Axel Springer AG as of December 30, 2010.
The Axel Springer share 27
Increased analyst coverage
Intensified investor relations
At the end of 2011, the Axel Springer share was covered
by 17 (PY: 10) stock analysts. One additional analyst has
commenced coverage since the beginning of 2012. A
continually updated, complete list of banks and invest-
ment banks that cover our share, along with their invest-
ment recommendations and share price targets, can be
found in the Investor Relations section of our website.
Share Information
€
Earnings per share (diluted)
Earnings per share (adjusted, diluted)
Dividend1)
2011
2010 Change
2.62
3.03
1.70
2.73
– 4.0 %
2.60
16.9 %
1.60
6.2 %
Total dividend payout (€ millions)
167.6
157.3
6.5 %
Year-end share price
33.21
40.67 – 18.3 %
Highest price
Lowest price
41.67
40.78
2.2 %
24.50
24.44
0.3 %
Market capitalization (€ millions)2)3)
3,274.7
3,999.2 – 18.1 %
Daily traded volume (Ø, € thousands) 7,278.0
3,262.1 > 100 %
Dividend yield1)3)
5.1 %
3.9 %
Total yield per share per year4)
– 14.4 %
68.4 %
-
-
1) Dividend proposal for financial year 2011.
2) Calculated on the basis of the year-end closing price.
3) Based on shares outstanding, excluding treasury shares.
4) Share price development plus dividend payment.
Axel Springer intensified its capital markets communica-
tion still further in 2011. The company’s Management
and Investor Relations team presented the company
and its strategy on a total of 33 days (PY: 28) at investor
conferences and roadshows in Germany, Great Britain,
the United States, France, Spain, and Switzerland. In
addition, we were available throughout the year to hold
discussions with investors and telephone conferences
on the occasion of publishing our financial reports. Our
telephone conferences are streamed live on the Internet
and are available to download afterwards.
We held our fourth “Capital Markets Day” for stock ana-
lysts, institutional investors, and bankers at our corporate
headquarters in Berlin on December 9, 2011. The event
was broadcast live on the Internet as a webcast and
could be downloaded afterwards, along with the presen-
tations shown there.
Besides institutional investors and stock analysts, we are
always glad to speak with individual investors as well,
either in person at our annual shareholders’ meeting, on
the telephone, or by e-mail. Our contact information is
printed on the last page of this Annual Report, where
you will also find our financial calendar with important IR
dates. Up-to-date information on the latest develop-
ments can always be found in the Investor Relations
section of our website at www.axelspringer.de. That is
where you can also order our print publications and
download special investor presentations.
28 Annual Report 2011 Axel Springer AG
Once again record dividend
Share split
About 370 shareholders attended the annual sharehold-
ers’ meeting of Axel Springer AG in Berlin on April 14,
2011. With about 81.8 % of voting capital represented,
the annual shareholders’ meeting adopted all the resolu-
tions proposed by the management – including the pay-
ment of a dividend of € 4.80 per qualifying share (corre-
sponding to € 1.60 after the share split, see below) –
with majorities of at least 88.8 %. Thus, the dividend was
€ 0.40 higher than the year before and was the highest
dividend ever paid by Axel Springer. The total dividend
pay-out amounted to € 157.3 million and the dividend
yield (based on the closing price at the end of 2010) was
3.9 %. Thus, the Axel Springer share is one of the
strongest dividend stocks in the MDAX.
Shareholder Structure
Axel Springer Gesellschaft für Publizistik
Dr. h. c. Friede Springer
Axel Springer AG
Free float
The amendment to the company’s Articles of Incorpora-
tion approving a 1:3 share split, which had been resolved
by the annual shareholders’ meeting, took effect upon
being recorded in the Commercial Register on May 31,
2011. The stock exchange listing was modified accord-
ingly on June 8, 2011. Arithmetically, the share price is
now equal to one third of the previous value and the
proportion of share capital represented by each share is
no longer € 3.00, but € 1.00. Following the share split,
there are 98.940 million Axel Springer shares outstanding.
Information on Listing
Share type
Registered share with restricted
transferability
Stock exchange
Frankfurt (official market)
Stock exchange segment
Security Identification Number
Prime Standard
550135, 575423
ISIN
Thomson Reuters
Bloomberg
DE0005501357, DE0005754238
SPRGn.DE
SPR GY
41.1 %
0.3 %
7.0 %
51.5 %
Status: December 31, 2011
Employees 29
Axel Springer’s personnel policies are guided by the
company’s core values of creativity, entrepreneurship,
and integrity. We reward both the willingness to strive for
outstanding performance and the creativity of our em-
ployees, who numbered 12,885 on average during the
past year (PY: 11,563).
Employees by Segments
Annual average
Newspaper National
Magazines National
Print International
Digital Media
Services/Holding
20.9 %
23.5 %
20.2 %
7.6 %
27.8 %
Specialized vocational training and
continuing education
In order to meet the growing challenges of its business,
Axel Springer offers a diverse program of vocational
training and continuing education, as a key element
of its personnel policy.
The 214 vocational trainees who were learning a trade
within our company at year-end 2011 are an impressive
demonstration of the fact that Axel Springer lives up to
its responsibility as a vocational training enterprise. We
offer vocational training programs for the occupations
of Digital/Print Media Managers and Designers, Office
Communication Managers, and Specialists in Media and
Information Services. Axel Springer also offers a dual
work-study track leading to a Bachelor of Science
degree in business administration.
Whether print or online, the success of media offerings
depends on quality; accordingly, we place a high priority
on providing excellent training to young journalists. Be-
cause it pursues a cross-media approach, successfully
linking traditional journalism with the techniques of cross-
media presentation, the Axel Springer Academy is widely
considered to be Germany’s most modern school of
journalism.
The Axel Springer Academy works closely with WELT
KOMPAKT and also collaborates with the prestigious
Columbia School of Journalism in New York. Our young
journalists regularly attend courses there. In exchange,
the Axel Springer Academy places the best Columbia
School of Journalism graduates in internships and per-
manent freelance journalist positions in Axel Springer’s
major editorial departments in Germany, and increasingly
also in Russia, Spain, France, and Poland.
Axel Springer offers all its employees a diverse program
of continuing education courses, including seminars for
managers and employees, work-accompanying continu-
ing education courses, mentoring programs, coaching,
networking sessions, language courses, and presenta-
tions on topics of current interest, particularly on the
subject of digitization, which was the central theme of
such presentations in the past year. The purpose of all
these measures is to prepare our employees to meet the
challenges arising from the strategic development of our
company. Besides standard seminars, we also offer
specialized training geared to the specific needs of
our operating divisions and teams.
Since 2008, we have successively implemented the
“Development Dialog,” a structured meeting between
every employee and his or her supervising manager,
throughout the entire company, with the aim of helping
employees develop their career potential on a personal-
ized basis geared to their specific needs. By the end of
2011, approximately 5,800 supervisors and managers
had participated in the Development Dialog.
“Moving People and Media” is the slogan under which
the Sales and Marketing Institute founded in 2005 has
developed into the Axel Springer Media Campus. The
purpose of this institution is to identify, promote, and
30 Annual Report 2011 Axel Springer AG
develop young talents. To that end, the Media Campus
pursues three main objectives: recruiting by way of the
“Best-Seller” program; training and experience-sharing
by way of the internal continuing education program; and
the development of future potential by means of support-
ing expert careers.
Systematically promoting young talent
Since 2010, we have supported selected young talents in
preparing for future managerial roles through our Group-
wide career development program known as the Top
Talent Program. In 2010/2011, 20 such selected young
talents underwent training modules on general manage-
ment topics such as strategy, media law, finance, leader-
ship, and project management, which were developed in
cooperation with various business schools. As the inter-
national counterpart to the Top Talent Program, we
launched the International Talent Program in 2011, with
18 participants. Being aimed specifically at young talents
in the Group’s international subsidiaries, this program
also serves to advance the internationalization strategy
of Axel Springer AG. Both programs seek to promote
exchanges and networking within the company and
to retain young talents as employees of our company.
Axel Springer AG is constantly looking for outstanding
college graduates to join the company and participate in
its trainee programs for young talents. To that end, we
expanded and intensified the company’s cooperation
with selected universities in 2011. As part of our university
marketing program, we conducted more than 70 recruit-
ing events last year. With the assistance of our senior
managers, we also conducted realistic case studies for
professorial chairs, so as to provide the students with
valuable insights into the media business on the basis of
real-world projects. Such activities have demonstrably
enhanced Axel Springer’s appeal as an employer (results of
the survey conducted by trendence and Universum, 2011).
Our trainee program aimed at top college graduates is
designed to help them start their careers in the media
business by providing theoretical and methodological
instruction, facilitating personal networking within the
company, and giving them the opportunity to “learn by
doing” in the company’s operating divisions.
Axel Springer also assists employees wishing to obtain a
college education; for example, it provides college schol-
arships to especially well-qualified vocational trainees.
Successor management
In 2011, we expanded the successor management pro-
gram introduced in 2010 for critically important man-
agement positions. Under this program, we identify
potential candidates for key management positions at an
earlier stage than before and systematically support the
development of their potential. The goal of this program
is to enable the company to fill vacant or new positions
with suitable candidates from within the company at all
times, and to mobilize the capabilities of our senior man-
agers and our young managerial talents in a more tar-
geted manner than before.
Feedback for senior managers
We successfully completed our pilot project for “180-
degree feedback” in 2011. Under this project, 24 senior
managers from the top management level conducted a
self-assessment of their own management behavior,
based on the company’s management principles. They
also invited their employees and supervisors to provide
systematic feedback. The 180-degree feedback is de-
signed to give our managers the chance to reflect on and
improve their own management conduct. This voluntary
development instrument will now be offered to other
senior managers as well. By this means, we seek to per-
manently instill our management principles throughout the
company and give employees the chance to provide
structured feedback to their supervising managers.
Compensation geared to success and
performance
The compensation granted to the employees and man-
agers of Axel Springer is geared towards success and
performance, on the basis of target agreements. New
targets are set every year. They include both company-
wide targets, divisional targets, and individual targets. In
addition, eligible employees received a profit-sharing
bonus of € 800 for financial year 2010.
Employees 31
Share ownership program
Equal opportunity and diversity
Our employees benefited directly from the appreciation
of the company’s value by participating in our share
ownership program. Under this program, all employees
of Axel Springer AG and its domestic subsidiaries who
were eligible for the profit-sharing bonus for 2010, or
who had entered into a target agreement, were given the
chance in May 2011 to convert 50 % or 100 % of their
profit-sharing bonus or performance-dependent com-
pensation into shares of Axel Springer AG. To those
employees who opted to convert half their profit-sharing
bonus or performance-dependent compensation, Axel
Springer contributed an additional 15 %, and to those
employees who opted to convert all that amount, the
company contributed an additional 30%. The required
holding period is one year for employees who qualified
for the profit-sharing bonus and two years for those with
a target agreement. The shares were taken from the
treasury shares of Axel Springer AG.
Idea management program
The company’s idea management program employs
targeted bonus incentives to fully exploit the idea-
generating potential of all employees, in order to make
the company even more innovative and profitable.
In 2011, we paid a total of € 168 thousand (PY:
€ 259 thousand) in rewards for the many improvement
suggestions they submitted.
Pension plan
By participating in the VarioRente program, an innovative
company pension plan based on deferred compensation,
our employees can accumulate an additional pension benefit
for themselves. In November 2011, the Management Board
and Central Works Council of Axel Springer AG reached an
agreement to extend the 6 % interest paid on contributions
for another two years. This offer was very well received by
employees again in 2011, as evidenced by the fact that the
average participation rate rose to 39 % (PY: 38 %).
Axel Springer promotes the development of all its em-
ployees equally. Thus in 2010, Axel Springer launched a
new, Group-wide project entitled “Opportunities:Equal!”
to increase the percentage of women in senior manage-
ment positions, so as to achieve a better balance be-
tween women and men in the company’s management.
The objective of this program is to increase the percent-
age of women on all management levels to more than
30 %, as a company-wide average, in the next four to
seven years. Instead of a uniform quota, we adopted
individual targets for each area of the company. At De-
cember 31, 2011, the percentage of women in manage-
ment positions at Axel Springer in Germany was 25 %.
Compatibility of work and family
Axel Springer operates two attractive day care centers,
each in close proximity to the company’s offices in Berlin
and Hamburg, respectively, for the children of its employees.
In the interest of helping its employees balance work and
family, Axel Springer AG has also entered into a master
agreement with the specialized service provider known
as pme Familienservice. This independent company
provides advice and referrals for child care, emergency
child care, and care for family members in need of nurs-
ing care. This offer was extended to all the company’s
German locations in 2011.
The charitable foundation known as Hertie-Stiftung
awarded the quality seal “audit berufundfamilie” (which
means “work-and-family audit”) to Axel Springer AG in
May 2011. This coveted distinction, which is awarded
under the auspices of the German Federal Minister for
Family Affairs and the German Federal Economics Minis-
ter, assists companies in their efforts to permanently
implement family-friendly personnel policies. Eight action
areas systematically evaluate these companies’ particular
development potential, and then develop and implement
coordinated measures to assure even better compatibility
of work and family.
32 Annual Report 2011 Axel Springer AG
Social responsibility
32
To remain successful over time, a company must oper-
ate on a sustainable basis. At Axel Springer, our activities
are guided by the International Social Policy, which ap-
plies to all our companies worldwide, and by our Envi-
ronmental Protection Guideline. Furthermore, Axel Springer
voluntarily submits to regular EC Eco-Audits of our print-
ing facilities in Germany, which are conducted by an
independent appraiser to verify compliance with our
Environmental Protection Guidelines.
Axel Springer has published environmental performance
reports since the mid-1990s (far earlier than most other
German companies), as well as sustainability reports
since 2000. Since 2005, the company has published a
biannual Sustainability Report, compiled at “Level A+,”
on the basis of more than 120 economic, social, and
ecological performance criteria established by the Global
Reporting Initiative (GRI) and audited by an independent
auditing firm. The latest Sustainability Report was pub-
lished in mid-2010. The company’s Sustainability Re-
ports are available at www.axelspringer.de/sustainability.
Again in 2011, the ratings agency oekom research, which
specializes in sustainability, conducted an in-depth study
of the sustainability performance of exchange-listed media
companies. Based on that research, oekom research
issued its “prime recommendation” to Axel Springer AG.
Commitment to social responsibility
Axel Springer is the only media company to have its own
corporate constitution. Dating back to 1967, this docu-
ment proclaims the company’s unconditional support of
liberty and the rule of law in Germany, the social market
economy, the unification of Europe, and the alliance with
the United States of America, based on shared values. We
also strongly advocate reconciliation between Germans
and Jews, and support the vital rights of the Israeli people.
For a modern society composed of different nationalities
and cultures, integration poses a particular challenge.
For that reason, Axel Springer is particularly proud of the
distinction awarded jointly to BILD and the Turkish daily
Hürriyet: The Bavarian state government awarded its
“Integration Letter” to Europe’s biggest daily newspaper
and the biggest Turkish daily primarily for “their reporting
of positive examples of integration“ and for the “basic
tenor of their reporting.” For many years, the two news-
papers have collaborated in editorial matters, also ex-
changing reporters and editors.
In March 2011, BILD der FRAU held its fifth annual
“GOLDENE BILD der FRAU” awards program to honor
women who have demonstrated extraordinary commit-
ment, passion, and competence in the service of social
welfare projects. The five prize winners to be honored at
the ceremony in March 2012 were presented to the pub-
lic as part of a billboard campaign in more than ten cities.
Commitment to social welfare
Axel Springer conducted numerous activities and projects
in support of other socially and politically relevant issues
in 2010 as well as including donation campaigns and the
support and recognition of volunteerism.
Donations
In December 2011, the association “BILD hilft e. V.”
sponsored the eleventh annual fundraising gala “A Heart
for Children,” raising more than € 14 million in donations.
Since 1978, “A Heart for Children” has raised a total of
more than € 190 million for needy children in Germany
and around the world.
The mass-circulation daily BLESK, published by the joint
venture Ringier Axel Springer Media in the Czech Republic,
sponsored its second annual “Magic Night for Children.”
This year’s fundraising gala, which is modeled on “A
Heart for Children,” raised about € 390 thousand in
donations for gravely ill and handicapped children.
Social responsibility 33
Volunteering
In a little more than two years, the “Berlin Heroes” pro-
gram, through which B.Z. reports every day on volun-
teering and social welfare activities in Berlin, has reported
on about 2.5 thousand “heroes” who volunteered about
15 thousand hours of their time. To mark the two-year
anniversary of this program, “B.Z. am SONNTAG” de-
voted its issue of December 25, 2011 to the subject of
social responsibility and “Berlin Heroes,” with information
on social welfare causes, volunteering, and the right way
to donate.
Founded in 2010, the FAKT Foundation, an initiative of
the Polish mass-circulation daily FAKT, which is pub-
lished by the joint venture Ringier Axel Springer Media,
was supported again in 2011 by government officials,
business leaders, and many well-known sports and
entertainment figures. One of the projects sponsored by
this initiative works to build and equip playrooms for
children in Polish hospitals.
Commitment to sustainability
Energy efficiency and green IT
“Green IT” is a topic of growing importance for Axel
Springer. As we make more of our journalistic content
available for online or mobile consumption, the energy
efficiency of digital data processing becomes more im-
portant. Furthermore, Axel Springer wishes to make its
digital value chain transparent and establish appropriate
sustainability standards similar to those applied in pre-
senting and monitoring the print value chain. Under a
Green-IT project sponsored by the German Federal
Economics Ministry, Axel Springer AG and the German
Federal Environment Agency are practice partners to
TU Berlin and the University of Göttingen.
Sustainable business practices
Axel Springer has been documenting resource efficiency
indicators for energy, CO2, water, and waste at its print-
ing plants and office buildings already since 1998. Fur-
thermore, all our locations and companies are bound by
the company’s Environmental Protection Guideline to
minimize the burden on the environment and to use
resources as efficiently as possible.
Environmental Indicators of the Printing Plants
per million m2 of printed paper
2011 Change yoy
Waste water (in m3)
Solid waste (in t)
Energy consumption (in MWh)
Greenhouse gas emissions (in t)
4.2
2.0
7.1
2.5
– 5.4 %
– 1.9 %
– 7.2 %
– 2.0 %
All the company’s own printing plants reduced their
absolute energy consumption from the prior year. Fur-
thermore, the energy consumption per square meter of
printed paper was reduced by more than 7 %. Factors
contributing to these reductions included the warmer
winter temperatures in 2011, compared to the prior year,
as well as lower-volume print runs and the measures
taken to enhance energy efficiency. Our printing plants in
Germany and Hungary also improved their environmental
performance indicators relative to waste water, green-
house gas emissions, and solid waste, both in absolute
terms and in terms of specific resource efficiency.
Sustainability management of our suppliers
We also expect our suppliers (especially along the wood,
paper, and recycling chain) to engage in sustainable
business practices. More specifically, we expect them to
extract raw materials in the most environmentally com-
patible way possible and produce their products in a
socially responsible manner. The corresponding ecologi-
cal and social criteria are set out in our Environmental
Protection Guideline and the International Social Policy.
34 Annual Report 2011 Axel Springer AG
34
Combined
Management Report
General assessment of the Group’s
business performance and operating
results in 2011
The Management Board and Supervisory Board will
propose to the annual shareholders’ meeting to be held
on April 25, 2012 that the company pay a dividend of
€ 1.70 (PY: € 1.60) per qualifying share.
Axel Springer turned in a very successful performance in
financial year 2011, moderately surpassing the revenue
forecast that was originally published in March and then
increased slightly in the autumn, and generating a record
profit yet again.
Once again, the 10.1 % increase in consolidated revenues
to € 3,184.9 million reflected the success of our interna-
tionalization and particularly our digitization efforts. Again in
2011, the increase in revenues was supported by consoli-
dation effects, but also by organic growth. Adjusted for
consolidation effects, consolidated revenues were 3.9 %
higher than the corresponding prior-year figure.
The revenues generated in the German print business were
slightly lower than the corresponding prior-year figure, but
the profit margin of the Newspapers National segment was
again very high and the profit margin of the Magazines
National segment was even higher than the prior-year profit
margin. The Print International segment reported a signifi-
cant increase in revenues and EBITDA in 2011, due to
consolidation effects related to the joint venture in eastern
Europe in the first half of the year. The Digital Media seg-
ment generated very dynamic revenue growth, accompa-
nied by a significantly higher increase in earnings.
The 16.2 % increase in the Group’s overall EBITDA
(Earnings Before Interest, Taxes, Depreciation, and
Amortization) was significantly greater than the rate of
revenue growth. The EBITDA of € 593.4 million was a
new record for Axel Springer. The EBITDA margin im-
proved from 17.6 % to 18.6 %, underscoring the Group’s
profitability. At € 289.4 million, consolidated net income
was 5.6 % higher than the prior-year figure. Adjusted for
non-operating effects, consolidated net income amount-
ed to € 343.3 million, reflecting an even greater increase
of 21.2 % over the corresponding prior-year figure. The
earnings per share came to € 2.62 (PY: € 2.73), or
€ 3.03 on an adjusted basis (PY: € 2.60).
Outlook for 2012
In financial year 2012, Axel Springer will continue to
pursue the threefold strategy of expanding its market
leadership position in the German-language core busi-
ness and advancing the process of internationalization
and digitization.
Under the assumption that general economic conditions
do not experience a significant deterioration, we expect
to generate a single-digit percentage increase in the
Group’s total revenues in financial year 2012. The
anticipated slight decrease in circulation revenues should
be more than offset by the generally higher advertising
revenues and other revenues, compared to 2011. We
expect that the slightly lower revenues in the national and
international print business will be more than made up by
higher revenues in the digital media business.
We also expect that the Group’s EBITDA will be slightly
higher than EBITDA for 2011. In that respect, we antici-
pate slightly lower earnings in the print business, and
substantially higher earnings in the digital business,
compared to 2011.
Introductory remarks
The present combined management report for Axel
Springer AG and the Group contains statements about
the economic situation and business performance of the
Axel Springer Group. These statements are also largely
applicable to the parent company Axel Springer AG.
Additional information on the economic situation of Axel
Springer AG is provided in a separate chapter on page 67.
In the interest of enhanced comparability, the operating
earnings indicator EBITDA has been adjusted for nonre-
curring effects and for the effects of purchase price
allocations (see Section 31 of the notes to the financial
statements).
Combined Management Report 35
Business and framework conditions
Business and framework conditions
Segments
Axel Springer Group
Newspapers
Magazines
Print
National
National
International
Digital
Media
Services/
Holding
Corporate structure and business activities
Legal structure of the Group, business locations
Axel Springer AG is an exchange-listed stock corporation
with its registered head office in Berlin. Through our
numerous subsidiaries, we also maintain offices at other
locations in Germany, including Hamburg, for example.
In addition, the Axel Springer Group comprises numer-
ous companies in other countries of Europe, such as in
Budapest (Hungary), Prague (Czech Republic), Warsaw
(Poland), Bratislava (Slovakia), Belgrade (Serbia), Mos-
cow (Russia), Zurich (Switzerland), Paris (France), and
Madrid (Spain). Through its subsidiaries, joint ventures,
and licenses, we are represented in a total of 34 coun-
tries. At December 31, 2011, the Axel Springer Group
comprised 119 fully consolidated companies, including
65 outside of Germany. The consolidated shareholdings
of the Group are listed in Section 42 of the notes to the
financial statements.
Segments and organizational structure
The business activities of Axel Springer are divided into a
total of five segments: Newspapers National, Magazines
National, Print International, Digital Media, and Services/
Holding. We employ a cross-media approach to link
these segments, both strategically and economically, in
order to make optimal use of synergies and identify all
possible ways of generating value, ideally.
Newspapers National
This segment comprises the newspaper and advertising
supplements published in Germany, which are sub-
divided into newsstand newspapers and subscription
newspapers, as well as regional and national newspapers.
Portfolio Newspapers National (Selection)
Newsstand Newspapers
Subscription Newspapers
National
Regional
National
Regional
BILD
BILD am
SONNTAG
B.Z.
B.Z. am
SONNTAG
HAMBURGER
ABENDBLATT
BERLINER
MORGENPOST
DIE WELT
WELT
KOMPAKT
WELT am
SONNTAG
WELT am
SONNTAG
KOMPAKT
BILD is Europe’s biggest daily newspaper. Among
newsstand newspapers, it is the market leader in
Germany by a wide margin. Together with the Berlin
newspaper B.Z., it commands a market share of 79.9 %,
based on the paid circulation of German newsstand
newspapers. B.Z. is also the market leader in the Berlin
newspaper market.
Among subscription newspapers, DIE WELT is
Germany’s third-biggest premium daily newspaper, with
a market share of 16.9 % (including the tabloid-format
WELT KOMPAKT, based on paid circulation). The
biggest subscription newspaper in Hamburg and the
surrounding area is our regional newspaper HAMBURGER
36 Annual Report 2011 Axel Springer AG
ABENDBLATT, and BERLINER MORGENPOST is the
second-biggest subscription newspaper of the German
capital city. As for national newspapers, our Sunday
newspapers BILD am SONNTAG and WELT am
SONNTAG are the clear leaders, commanding an 84.1 %
share of the circulation market.
Magazines National
Axel Springer is the third-biggest German magazine
publisher, with leading market positions in all the main
segments.
Portfolio Magazines National (Selection)
TV Program Guides
and Women’s
Magazines
Automotive,
Computer, and
Sports Magazines
Music
Magazines
TV Program Guides
Automotive
Music
HÖRZU
TV DIGITAL
FUNK UHR
AUTO BILD
AUTO TEST
AUTO BILD KLASSIK
ROLLING STONE
MUSIKEXPRESS
METAL HAMMER
Women’s
Computer
BILD der FRAU
FRAU von HEUTE
COMPUTER BILD
COMPUTER BILD
SPIELE
Sports
SPORT BILD
In the category of TV program guides and women’s
media, the biweekly TV DIGITAL is the highest-circulation
TV program guide in the high-price segment, while HÖRZU
occupies the leading position in the category of premium
weekly TV program guides. The market leader in the cate-
gory of women’s magazines is BILD der FRAU, with a circu-
lation market share of 31.8 %.
Nearly all the Group’s automotive, computer, and sports
media are derived from the BILD family of brands. AUTO
BILD, COMPUTER BILD, and SPORT BILD are each lead-
ers in Europe in their respective categories. The Group’s
specialty titles also occupy top positions in their respective
market segments.
The market segment of music magazines comprises
ROLLING STONE, MUSIKEXPRESS, and METAL HAMMER.
Print International
In addition to its activities in Germany, Axel Springer
publishes more than 190 newspapers and magazines
through its own subsidiaries and joint ventures, and by
way of licensing. Axel Springer has further extended both
its presence and its portfolio in eastern Europe through
the joint venture Ringier Axel Springer Media. In the
segment of mass-circulation dailies, Axel Springer is
currently the market leader in four countries of eastern
Europe (see page 48 for additional information on the
joint venture). In western Europe, Axel Springer’s activi-
ties are focused on Switzerland, France, and Spain.
Markets Print International
Eastern Europe
Western Europe
Ringier Axel Springer Media
Switzerland
France
Spain
Poland
Czech Republic
Slovakia
Serbia
Hungary
Russia
Eastern European markets
In Hungary, Axel Springer publishes more than 40 mag-
azines and nine daily newspapers, as well as the corre-
sponding Sunday newspapers, and is that country’s
second-biggest publishing company, with a market share
of 20.8 %, based on paid circulation. Axel Springer is the
leading publisher of TV program guides, regional and
business newspapers, home and garden magazines,
automotive magazines, cooking magazines, and puzzle
magazines. See page 48 for information on the planned
merger of Axel Springer’s activities in Hungary with those
of Ringier, including Blikk, which is the country’s biggest
mass-circulation daily, based on paid circulation.
In Poland, Ringier Axel Springer Media publishes three
newspapers and 12 magazines. These include Poland’s
leading newsstand newspaper FAKT and the country’s
only national sports daily PRZEGLAD SPORTOWY and
give us a market share of 35.8 % in the national daily
newspapers segment, based on paid circulation, making
Ringier Axel Springer Media the biggest newspaper pub-
lisher in Poland.
Combined Management Report 37
Business and framework conditions
In the Czech Republic, our joint venture with Ringier is
the biggest publishing house, with six newspapers and
14 magazines. Besides the leading mass-circulation
newspaper BLESK, Axel Springer is also the market
leader in the category of automotive magazines. And
BLESK PRO ZENY is the widest-reach women’s maga-
zine in that country.
Axel Springer’s market leadership position in Slovakia is
largely based on the NOVY CAS family of brands, con-
sisting of two newspapers and four magazines. The
eponymous mass-circulation newspaper is the country’s
biggest newspaper, with a market share of 43.4 %. In
total, Ringier Axel Springer Media publishes two newspa-
pers and nine magazines in Slovakia.
In Serbia, Ringier Axel Springer Media publishes three
newspapers and seven magazines, and is the publisher
with the highest total circulation and the widest reach in
that country. The joint venture also publishes BLIC, the
biggest newspaper in Serbia.
We publish a total of seven titles in Russia: the business
magazine FORBES, as well as COMPUTER BILD, GALA
BIOGRAFIA, and OK!, and three magazines of the GEO
brand family.
Western European markets
In Switzerland, Axel Springer publishes HANDELSZEITUNG,
as well as 14 magazines. It is the market leader in the
segments of business and finance magazines and TV
program guides. The business magazine BILANZ and
the business newspaper HANDELSZEITUNG are the
most-read publications in the business segment. In the
category of general-interest magazines, Axel Springer
publishes the country’s biggest subscription magazine,
BEOBACHTER; in the category of TV program guides,
the Group is likewise the market leader, through its publi-
cations TELE and TV STAR.
In France, we publish nine TV program guides, women’s
magazines, and cooking magazines, as well as four auto-
motive magazines in a joint venture with the Mondadori
Group. The most important titles are the TV program guide
TELE MAGAZINE, the cooking magazine VIE PRATIQUE
GOURMAND, and the automotive magazine AUTO PLUS.
Axel Springer publishes 14 magazines in Spain. We are
the No. 1 publisher in the category of video game and
computer magazines; in the automotive magazine seg-
ment, we publish the market leaders AUTO BILD ESPAÑA
and AUTO BILD 4x4.
Digital Media
In its Digital Media segment, Axel Springer focuses on its
three areas of expertise: content portals, online market-
places, and online marketing. Aside from our German
online offerings, this segment also comprises our digital
activities in foreign countries and our portfolio of radio and
television investments.
Portfolio Digital Media (Selection)
Content portals
Marketplaces
Bild.de
aufeminin.com
gamigo.de
welt.de
autobild.de
computerbild.de
finanzen.net
abendblatt.de
morgenpost.de
SeLoger.com
(Real estate)
stepstone.de
(Jobs)
idealo.de
(Price comparison)
immonet.de
(Real estate)
AutoReflex.com,
CarWale.com
(Automotive)
Marketing
Financial Media
zanox
Digital Window
eprofessional
kaufDA
Content portals
Bild.de is the widest-reach German-language information
and entertainment portal, while WELT ONLINE occupies
the leadership position among the websites of German
premium newspapers. Thanks to its comprehensive
video offering, Bild.de is also one of the leading moving-
image platforms on the German Internet. And Bild.de
Mobile is the biggest German information portal for
mobile terminal devices, with an average of more than
29.4 million visits per month.
Axel Springer’s portfolio in this segment is supplemented
by the online portals of the Group’s German regional
newspapers and magazines, and its foreign print media.
Axel Springer also operates the women’s portal aufemi-
nin.com, the European market leader among websites for
fashion, beauty, and lifestyle, as well as a large number of
special-interest portals, such as the finance portal finan-
zen.net, market leader in the finance portal segment, and
gamigo.de, one of the leading providers of online games
38 Annual Report 2011 Axel Springer AG
in Europe, for example. In addition, we operate a soccer
community, transfermarkt.de, which is also one of the
biggest sports websites in the German-language Internet.
and Berlin, and non-controlling interests in some of
Germany’s most successful radio stations.
Furthermore, Axel Springer offers its own editorially pro-
duced content increasingly in the form of paid apps for
mobile terminal devices like smartphones and especially
tablet PCs (see also page 61).
Marketplaces
Axel Springer’s online marketplaces help Internet users
find the right products, amid the sheer abundance of
available offerings. StepStone is one of the leading online
job exchanges in Europe; idealo.de is one of the biggest
German search engines for price and product compari-
sons; and immonet.de is one of the leading German
online portals for real estate marketing. In France,
SeLoger is the market leader among online real estate
portals; since mid-2011, it also holds an investment in
iProperty, the biggest network of real estate portals in
southeast Asia. And we hold an investment in AutoRe-
flex.com, a leading French portal for automotive classi-
fied ads, as well as investments in autohaus24.de, a
cross-brand portal for new cars, in buecher.de, an online
department store for books, music, and films. In India,
we hold a majority interest in CarWale.com, the market
leader for online sales of new and used cars.
Marketing
Through the zanox Group (including Digital Window,
buy.at, and M4N), Axel Springer is the European market
leader and one of the world’s leading service providers in
the segment of performance-based online marketing. In
March 2011, moreover, Axel Springer purchased a major-
ity interest in kaufDA, the German market leader for local
shopping offers, such as online brochures, for example.
TV/radio
In the TV/radio sector, the Group holds a non-controlling
interest in Turkey’s biggest private-sector TV and radio
company, the Do⁄an TV Group. This TV Group is the
market leader, both in terms of audience shares and
advertising market shares. Schwartzkopff TV is a
successful production company specializing in TV enter-
tainment formats. Axel Springer also holds investments
in regional TV stations in the key markets of Hamburg
Services/Holding
The Services/Holding segment comprises the Group’s
three newspaper printing plants in Germany, as well as
the internal departments of Distribution and Logistics,
and various service and holding company functions.
Management and supervision
Management principles
Axel Springer’s management principles are aligned with
our core values of creativity, entrepreneurship, and integ-
rity, as well as the five principles enshrined in Axel
Springer’s own corporate constitution. For more infor-
mation on our internal guidelines, please refer to the
statements on corporate governance on page 86 of this
Annual Report.
Management Board divisions
As of January 1, 2012, Axel Springer’s Management
Board is composed of five members, whose work is
supported and supervised by a Supervisory Board com-
posed of nine members.
Axel Springer Management Board Divisions
Chairman and Chief Executive Officer
Dr. Mathias Döpfner
WELT Group and Printing
Jan Bayer
Management
Board Divisions
International Division
Ralph Büchi
Chief Financial Officer and
Chief Operating Officer
Lothar Lanz
BILD Group and Magazines
Dr. Andreas Wiele
Rudolf Knepper, the Management Board member in
charge of Printing, Logistics, and HR, resigned from Axel
Springer AG upon the expiration of his term of office on
Combined Management Report 39
Business and framework conditions
December 31, 2011. Therefore, the areas he had been
responsible for were reorganized, effective January 1,
2012. Lothar Lanz, the Management Board member
who had previously been in charge of Finance and Ser-
vices, additionally assumed responsibility for Human
Resources and Purchasing under the extended Man-
agement Board division of Human Resources, Finance,
and Services. Dr. Andreas Wiele, the Management
Board member in charge of the BILD Group and Maga-
zines, additionally assumed responsibility for IT and Lo-
gistics & Services. Jan Bayer, the Chief Executive in
charge of regional and subscription newspapers, was
named the Management Board member in charge of the
WELT Group and Printing. Finally, Ralph Büchi, President
of Axel Springer International and Managing Director of
Axel Springer Schweiz, assumed responsibility for Inter-
national Business.
Management Board responsibilities are now divided as
follows:
Besides serving as Management Board Chairman,
Dr. Mathias Döpfner is additionally responsible for the
Management Board division of Digital Media, as well as
the corporate staff function of Information and Public
Relations. Furthermore, all editors-in-chief report to him.
His responsibilities also include Executive Personnel,
Security, Public Affairs, Customer Loyalty Reinforcement,
and the Axel Springer Academy.
Jan Bayer has been the Management Board member in
charge of the WELT Group and Printing since January 1,
2012. This division covers regional and subscription
newspapers (WELT Group, BERLINER MORGENPOST,
HAMBURGER ABENDBLATT) and the company’s
printing plants.
Ralph Büchi heads up the Management Board division of
International Business, which encompasses all the Group’s
activities in Axel Springer’s international markets.
Lothar Lanz is the Management Board member in charge
of Human Resources, Finance, and Services, which in-
cludes business administration functions and Internal
Audit. He is also responsible for M&A and Strategy, Gov-
ernance, Risk & Compliance, Legal, and Purchasing.
Effective January 1, 2012, Dr. Andreas Wiele, the Man-
agement Board member in charge of the BILD Group
and Magazines, will additionally assume responsibility for
IT and Logistics & Services. His division encompasses
the cross-media publications of the BILD family of
brands and the related magazines, which are sub-
divided into the publishing groups BILD and BILD am
SONNTAG, Automotive, Computer and Sports Media,
TV Program Guides, and Women’s Media, and B.Z.
Basic principles of the compensation system
We compensate our employees, all the way up to the
top management level, on the basis of their performance
and success. Axel Springer introduced a variable com-
pensation system based on target agreements in 2007.
The targets are agreed every year anew; they include
both corporate targets and individual division targets. In
2010, moreover, we paid a voluntary, profit-sharing
bonus of € 800 to qualifying employees.
The compensation of the Management Board is likewise
determined on the basis of their performance and suc-
cess. Their compensation includes a remuneration as
well as variable components, some of which are geared
to the achievement of Group and individual targets, while
others are geared to the long-term increase in the com-
pany’s value, as measured by the performance of the
Axel Springer share. A detailed description of Manage-
ment Board compensation can be found in the “Com-
pensation Report” section of the “Corporate Governance”
chapter (starting on page 93). There, you will also find
information on the compensation of our Supervisory
Board members (starting on page 95).
Important products, services, and business processes
The revenues of the Axel Springer Group are mainly
composed of circulation and advertising revenues. Circu-
lation revenues are generated on the sales of our news-
papers, magazines, and digital information and enter-
tainment offerings, while advertising revenues are gener-
ated by marketing the reach of our print and online media.
Our value chain is designed on a cross-media basis. It
comprises all the important processes of a media com-
pany, from conception to editorial process and produc-
tion, distribution, and marketing.
40 Annual Report 2011 Axel Springer AG
Cross-media conception
We constantly strive to enhance the presentation of our
information and entertainment offerings, for example by
improving existing formats with new editorial and graphic
concepts or by introducing new products. In that respect,
we place an especially strong emphasis on our digital
media portfolio. The further development of our portfolio
is crucial to the success of our operating business. For
that reason, we also employ market research and pilot
projects to identify highly promising trends and technolo-
gies at an early stage, and to participate in their progres-
sion. At the same time, we always apply a cross-media
approach, so that we can make optimal use of synergies,
expertise, and reach.
Editorial content
Producing journalistic content in a creative and efficient
way, and exploiting that content on a cross-media basis,
is one of our core competencies. All journalistic content
is gathered in our newsrooms and processed there in
accordance with the demands of our print and online
media. We operate such integrated newsrooms for the
print, online, and moving-image media of the BILD and
WELT Groups, as well as BERLINER MORGENPOST,
B.Z., and HAMBURGER ABENDBLATT, for example,
and also for some of our international editorial teams.
Production
We produce our German newspapers in the Group’s own
three offset printing plants in Hamburg-Ahrensburg, Es-
sen-Kettwig, and Berlin-Spandau, among other places.
We perform all the necessary steps ourselves, from plate
production to shipping logistics. The production process
for our digital media usually involves the processing and
aggregation of information in databases and the posting of
that information on our websites or other digital resources.
Distribution
In Germany, our newspapers and magazines are distrib-
uted in more than 122 thousand retail sales outlets,
which are supplied in a fast, reliable manner, employing
a sophisticated logistics and transport system. We also
distribute our media worldwide, via press wholesalers
and press import companies.
We distribute our digital media through a variety of chan-
nels, including the Internet, mobile terminal devices, and
download platforms like Apple’s App Store and our
internally developed iKiosk (see page 44).
Marketing
Another important revenue source for Axel Springer,
besides the traditional circulation revenues generated on
sales of our print titles, are advertising revenues. In that
respect, our journalistic content serves the purpose of
reaching the target groups that are relevant to advertis-
ers, so as to generate the reach that can be marketed in
the form of ad space.
In the digital sphere, Axel Springer offers a wide range of
online advertising, such as banners, layer ads, and wall-
paper, as well as video formats, all of which are used for
traditional reach marketing. We also seek to harness the
potential of the growing online market by expanding our
own online marketing activities. Our portfolio also in-
cludes transaction-driven marketing models. As the
leading platform in Europe for performance-based online
marketing, the zanox Group brings advertisers and pub-
lishers together on the Internet, so as to generate new
sales and marketing possibilities for them on an interna-
tional level. Advertisers use our platforms to make their
products and services available so that publishers can
advertise those products and services by means of text
links, ad banners, and online videos. While the publishers
receive a commission from the advertisers for every
successfully completed online transaction, our platform
operates as an independent service provider, providing
the necessary infrastructure, recording data flows and
transactions, and offering tailored services, including the
payment of commissions. Furthermore, the services
offered by kaufDA give advertisers the ability to deliver
advertising brochures (inserts) via digital channels, in-
creasingly also to mobile terminal devices.
Axel Springer’s newspapers and magazines, and its brand-
derived digital media, are centrally marketed in Germany by
Axel Springer Media Impact, the country’s leading cross-
media marketer (based on gross market shares).
Combined Management Report 41
Business and framework conditions
Strategy and success monitoring
The goal of our corporate strategy, which comprises the
three main tenets of market leadership in the German-
speaking world, internationalization, and digitization, is to
sustainably increase the company value of Axel Springer
by means of profitable growth.
Strategy
In view of the constantly growing use of digital media, we
instigated the transformation from a mostly print-
dominated publishing house to an integrated cross-
media provider at an early stage. The long-term goal of
our efforts to further develop our offerings in Germany
and abroad and expand our digital activities is to be-
come Europe’s leading multimedia company, with strong
brands and revenues derived in equal shares from our
print and digital activities. We are pursuing this goal
intensively by means of extending our leading market
position in the German-language core business, and by
driving internationalization and digitization.
Market leadership in the German-language core business
Axel Springer is the market leader in the German-
language print business. Based on paid circulation, we
are the No. 1 publisher of newspapers and the No. 3
publisher of magazines. We strive to secure and solidify
our market leadership position by continually developing
and implementing creative new journalism concepts, and
by improving our existing print media or adapting them
to suit changing reader preferences, in matters of con-
ception, journalistic quality, and layout. We also conduct
targeted marketing campaigns and other activities to
reinforce the brand loyalty of our readers. Most of all,
we focus on continually improving our strong brands
in combination with innovative cross-media advertising
formats, in order to allow for optimal exploitation of the
wide reach of our print and online media.
Internationalization
Axel Springer’s internationalization strategy is focused
primarily on eastern Europe, where we launch or pur-
chase new titles and also act as licensors and licensees
for magazines or newspapers, and expand our digital
activities. Appropriate investments are chosen on the
basis of business strategies that fit in well with those of
the Axel Springer Group, as well as the professionalism
of their management, and the monetization potential of
their digital business models.
With currently four market-leading mass-circulation
newspapers in attractive growth markets, the partnership
with Ringier in the joint venture Ringier Axel Springer
Media provides an outstanding basis for the further
expansion of our core business of journalism; it also
creates ideal conditions for the further expansion of our
digital media business (see page 48 for more information
on the joint venture). We made significant progress in
integrating the activities within the joint venture in 2011.
The growth in international revenues was also driven by
the internationalization of digital business models and
acquisitions, such as the acquisition of the French real
estate portal SeLoger.com.
Digitization
In its digital business, Axel Springer focuses on its three
areas of core competence: content portals, online
marketplaces, and online marketing. We develop our
business even further by means of organic growth and
acquisitions.
We strive to transfer those attributes that make our print
media so outstanding – journalistic quality and strong
brands – to our national and international content portals
in a targeted manner. Thanks to the continuous im-
provement of editorial content and intensive networking
with virtual networks and online communities, the target
groups, and consequently also the reach values of our
content portals, are growing as well. In our content por-
tals, we are increasingly moving also in the direction of
paid premium content and offerings, putting to good use
the experiences we have gathered from the formats
introduced in the last few years. By that means, we are
exploiting new revenue sources.
Our online marketplaces like SeLoger, StepStone,
idealo.de, and immonet.de are attractive platforms for
online shopping and online classified ads. We are con-
stantly improving these marketplaces, while also taking
advantage of the synergies resulting from the combina-
tion with our content portals and print titles.
42 Annual Report 2011 Axel Springer AG
We are also exploiting the potential of the growing online
market by expanding our own online marketing activities.
In line with our strategy, we are seeking to further expand
the offerings of the zanox Group and kaufDA, as well as
the online marketing activities of our marketer Axel
Springer Media Impact.
Internal management system
We have designed our internal management system and
have defined suitable control parameters on the basis of
our corporate strategy. We use both financial and non-
financial performance indicators to measure the success
of our strategy.
Detailed monthly reports are an important element of our
internal management and control system. Those reports
contain the monthly results of our most important publi-
cations, along with a consolidated statement of financial
position, income statement and cash flow statement. We
use these reports to compare actual values with budget
values; in case of deviations, we conduct further analyses
or initiate suitable corrective measures.
These reports are supplemented by periodic forecasts of
anticipated advertising revenues in the next few weeks
and months and forecasts of the probable development
of our financial performance.
Financial performance indicators and control parameters
Our central focus is to sustainably increase both the profit-
ability and value of our company. The most important
target and control parameters for the company’s financial
performance are revenues and earnings (measured by
EBITDA). Those parameters also form the basis for the
performance-based remuneration of our Management
Board and other top executives (please refer to 93 for more
information on our compensation system). Both these
indicators and the EBITDA margin derived from them are
anchored in our internal planning and controlling system.
We employ various relative indicators to monitor the
successful implementation of our strategy, including the
proportion of consolidated revenues represented by
international revenues, for the purpose of analyzing the
progress we are making towards the goal of internation-
alization, and the revenues of the Digital Media segment
as a benchmark for our progress on digitization.
We employ a capitalized value method based on
weighted capital costs to assess the economic efficiency
of investments in new or existing business lines. The
weighted capital cost rate is calculated on the basis of
an ideal capital structure.
The risk of a capital investment project is generally repre-
sented by using a capital markets equilibrium model,
applying a beta factor (for the business-specific, system-
atic risk), and a market premium (for the country-specific,
nonsystematic market risk). As a general rule, it is as-
sumed that the company’s systematic risk is equivalent,
on average, to that of comparable companies in our peer
group of European media companies. Other specific
risks are additionally reflected in the updated, weighted
capital costs.
Financial Control Parameters
Selected financial control parameters
on the Group level, € millions
Consolidated revenues
2011
2010
3,184.9
2,893.9
Proportion of international revenues
32.9 %
28.1 %
Proportion of digital media1)
EBITDA
EBITDA margin
30.9 %
27.4 %
593.4
510.6
18.6 %
17.6 %
1) Basis: Pro-forma revenues in the Digital Media segment and pro-forma total revenues.
Non-financial performance indicators and control parameters
Besides financial performance indicators, we also em-
ploy non-financial performance indicators to measure our
success relative to the further development of our com-
pany, the implementation of our strategies, and the en-
hancement of our company value. Although the nonfi-
nancial performance indicators are not reflected in our
income statement, they are nonetheless key drivers of
Axel Springer’s value-driven development. They serve as
early indicators, both of changes in financial performance
indicators and of the success of strategic measures, and
therefore they enable us to quickly initiate corrective
measures when necessary.
Combined Management Report 43
Business and framework conditions
The following non-financial performance indicators are
significant for monitoring the company’s performance
relative to customers, markets, and products offered:
(cid:1) Average paid circulation of all significant newspapers
and magazines;
Global Reporting Initiative (GRI). Our main ecological
efficiency indicators are wastewater volumes, solid waste
quantities, climate-affecting emissions, and energy con-
sumption. For more information on the subject of sus-
tainability, please refer to page 32 of this Annual Report
or our Sustainability Report.
(cid:1) Average monthly unique visitors/visits, and other
Research and development
business model-specific indicators of our online media,
and the resulting market position;
(cid:1) Reach values of our media in the advertising market
and indicators of brand and advertisement familiarity.
Axel Springer has also set itself the goal of being Europe’s
most customer-friendly media company. To that end,
since 2007 we have developed an elaborate measure-
ment and evaluation system to measure our annual cus-
tomer retention index, in collaboration with the institution
TNS Infratest. This index is the most important indicator
of satisfaction and loyalty of our readers and advertising
customers. It is composed of numerous factors, includ-
ing the perceived quality of our publications, the brand
loyalty of our customers, repeat purchase rates, and the
respective competitive advantage. The customer reten-
tion initiative has triggered a cultural transformation in our
company and further bolstered our commitment to cus-
tomers over the last five years. And thanks to the multi-
faceted measures aimed at delivering added value to all
our customer groups, it makes a strategic contribution to
the long-term business success of our Group.
In order to identify and promote efficient processes with-
in our company as well, we measure the quality of our
internal cooperation and service orientation in a similar
manner and aggregate the results to form an internal
customer retention index. Together with the external
customer retention index, this indicator forms the basis
for a continuous improvement process that contributes
to the long-term enhancement of the company’s profitability.
In addition to the above-mentioned control parameters,
Axel Springer also counts social and ecological factors
among its non-financial performance indicators. For their
observation, we rely on the sustainability criteria of the
Axel Springer does not have a traditional research and
development department of the kind that can be found in
industrial enterprises; nonetheless, throughout the com-
pany, we constantly strive to optimize our offerings and
to establish innovative products in the market. Above all,
we continuously introduce new print, online, or mobile
formats, develop our editorial content, and uphold our
journalistic excellence. In that regard, we pay especially
close attention to identifying changing media usage
habits as early as possible.
In the print business, BILD offered an entirely new adver-
tising format with its first XXL issue in August 2011. The
DIN A1-format display area was especially attractive for
our advertising customers. The Slovakian daily NOVY
CAS also published an XXL issue in 2011.
In the digital business, we expanded our paid-content
offerings for mobile devices. On the one hand, a growing
number of Axel Springer’s media titles are now available
as iPhone and iPad apps. Among the new products
offered were three news apps by Ringier Axel Springer
in Slovakia, the e-magazines BEOBACHTER and
BEOBACHTER NATUR in Switzerland. On the other
hand, we introduced new versions of our innovative apps
that can run on other operating systems and tablets. To
cite a few examples, Android-compatible apps were
introduced for AUTO BILD, immonet, autoplus.fr, and
zanox. Furthermore, DIE WELT and WELT am SONNTAG
can now be enjoyed on both the iPad and the Kindle, the
e-book device produced by Amazon, as well as Android
tablets. Thus, the WELT Group became the first news-
paper group in Germany to offer content for all three
relevant platforms, in December 2011.
44 Annual Report 2011 Axel Springer AG
Since being introduced in 2010, our iKiosk app has
enabled users to access a broad selection of Axel
Springer’s newspapers and magazines on the iPad; in
December 2011, we launched an upgraded version of
this app, featuring more than 100 different titles, as well
as new functions and services, including (for the first time)
other publishers’ titles such as “Die Zeit,” “Süddeutsche
Zeitung”, and “Handelsblatt,” and others. Also in 2011,
iKiosk was introduced to the Swiss market, as the first
market outside of Germany; users of the Swiss version
can access both national titles and other publications by
Axel Springer. An app comparable to iKiosk, called
iStanok, was launched in Slovakia, enabling users to
access the seven most popular magazines published by
Ringier Axel Springer Media.
We also upgraded watchmi, the algorithm-based, self-
learning personal TV service that automatically records TV
programs based on the user’s individual preferences, so
that users can view them at any time. This upgrade will
enable watchmi to tap new groups of customers. We also
added two new options in 2011, making it possible to run
the program on set-top boxes and on the Web, in addition
to Windows Media Center. Since being launched, watch-
mi’s Windows Media Center plug-in has been download-
ed about 200 thousand times. We also introduced new
apps for Internet-capable (and thus app-capable) TV sets
in 2011, including “Bild.de News” with the latest news,
pictures of the day, and lots of videos on politics, sports,
and entertainment, from the BILD editorial team.
Overview of business developments
General economic environment
The global economic recovery began to lose steam in
2011. After registering very strong growth of 5.1 % in
2010, the world economy is likely to have grown by only
3.8 % in 2011. The continuation of the slowing trend that
began in mid-2010 can be attributed to the debt prob-
lems of many industrialized nations and to more restric-
tive economic policies (ifo Institute).
The intensification of the debt crisis weakened the Euro-
pean economy in particular. The U.S. economy began to
revive in the second half of 2011, apparently banishing
the specter of a “double-dip” recession there. The
emerging-market countries of east Asia and Latin Ameri-
ca adopted more restrictive economic policies, particu-
larly in the first half of 2011, with the aim of preventing
their economies from overheating (ifo Institute).
The German economy registered strong growth again
in 2011. According to calculations of the German Federal
Statistical Office, the country’s price-adjusted gross
domestic product expanded at a rate of 3.0 %. Thus, the
German economy continued to experience a strong
recovery, also in the second year after the economic
crisis. Domestic demand was a major factor driving this
recovery; consumer spending in particular, having in-
creased at a rate of 1.5 % in 2011, proved to be the
engine of the country’s economic upswing. But the
German economy was also helped by strong investment
spending. On a price-adjusted basis, investment in plant
and equipment rose by 7.6 % and building investment
spending by 5.8 %. Although foreign trade made a
smaller contribution to Germany’s economic growth
than domestic demand, it was nonetheless dynamic:
On a price-adjusted basis, exports grew by 8.2 %, while
imports grew at a slightly lower rate of 7.4 % (German
Federal Statistical Office).
The number of unemployed job-seekers fell to 3.0 million
in 2011, reflecting a decrease of 8.1 % from 2010 and
lowering the unemployment rate to just 7.1 %. The con-
sumer sentiment index published by the market research
company GfK Group remained on a high level in 2011.
Towards the end of the year, however, purchasing propen-
sity weakened somewhat. According to calculations of the
German Federal Statistical Office, consumer prices rose by
2.3 % in 2011, mainly as a result of higher energy prices.
In the EU countries of central and eastern Europe,
economic activity weakened appreciably in the second
half of 2011. Industrial production slowed markedly and
the high level of debt carried by private households in-
creased considerably.
Combined Management Report 45
Business and framework conditions
Whereas the circulation volumes of print media declined
again in 2011, online media continued the growth trend
of prior years. According to the study entitled “internet
facts 2011–10” published by the online research associ-
ation Arbeitsgemeinschaft Online Forschung (AGOF), a
total of 50.2 million people in Germany already use the
Internet (Internet users in the last three months). That
number represents 71.3 % of German residents aged 14
and older. As the Internet has become established in all
segments of the population, the demographic structure
of Internet users has drawn increasingly closer to that of
the overall population. Nearly three quarters of Internet
users (70.7 %) are between 14 and 49 years old, and
thus the proportion of users over 50 years old has since
risen to 29.3 %. Of the 50.2 million people who use the
Internet on a regular basis, 70.8 % go online to obtain
information about world events and 61.8 % use the In-
ternet for information on regional or local news. Thus,
news is one of the main reasons for using the Internet,
besides e-mail, online searches, online shopping, and
weather information. Jobs and real estate listings were
also two of the 20 most-used online categories.
Based on IVW data, the content portals of the German
print media were visited much more frequently in 2011
than in 2010. Thus, the 20 most popular portals of
German daily newspapers registered an average 20.9 %
increase, those of magazines an average 18.6 % increase
in the number of visits.
Advertising market
The German advertising market exhibited a positive
development again in 2011. According to surveys con-
ducted by Nielsen Media Research, the revenues of the
total gross advertising market registered a nominal
increase of 2.7 % over the prior year to reach
€ 21.8 billion in 2011. This gain resulted mainly from the
growth of online media, TV advertising, and billboard
advertising.
Anticipated Economic Development (Selection)
Change in gross domestic product
compared to prior year (real)
Germany
Switzerland1)
France
Spain
Hungary
Poland
Czech Republic
Slovakia
Serbia1)
Russia
Source: Ifo Institute, December 2011
1) Source: IMF, September 2011.
2011
3.0 %
2.1 %
1.6 %
0.7 %
1.4 %
4.0 %
2.0 %
2.9 %
2.0 %
4.0 %
Industry environment
Press distribution market
Continuing the trend of prior years, the German press
distribution market contracted slightly in 2011. The total
paid circulation of newspapers and magazines was 3.3 %
less than the corresponding prior-year figure. Thanks to
price increases, however, circulation revenues were only
1.7 % less than the corresponding prior-year figure.
The 369 daily and Sunday newspapers tracked by the
German market research institute IVW generated total
sales of 21.9 million copies per issue, reflecting a de-
crease of 3.1 % from 2010. As in the prior year, news-
stand sales suffered a much greater decline (– 6.2 %)
than subscription sales (– 1.9 %). Within the press distri-
bution market, the demand for daily and Sunday news-
papers (weighted for their respective publication fre-
quencies) declined by 3.1 %.
At 110.7 million copies per issue, total sales of general-
interest magazines including membership and club
magazines were 1.7 % less than the corresponding prior-
year figure. IVW tracked a total of 880 titles (+ 0.5 % over
the prior-year figure). Weighted for their respective publi-
cation frequencies, the demand for general-interest
magazines declined by 4.0 %.
46 Annual Report 2011 Axel Springer AG
Unless otherwise noted, the information presented below
on the development of the advertising market in Germany
is based on the latest survey of gross advertising reve-
nues (excluding media advertising) by Nielsen Media
Research. This data refers only to ads for name-brand
products and services and to ads for large retail chains.
The data does not include classified ads and advertising
supplements and therefore it does not fully reflect the actu-
al, total business performance. Furthermore, gross adver-
tising revenues are based on listed standard advertising
rates and do not reflect discounts or free ad space granted.
In general, therefore, one must assume that the develop-
ment of net advertising revenues lags behind that of gross
advertising revenues.
The gross advertising revenues of the print media (exclud-
ing classified ads, advertising supplements, and media
advertising) amounted to € 6.4 billion in 2011, which was
3.3 % less than the corresponding year-ago figure. The
decrease resulted mainly from the 6.5 % drop in the
volume of display ads appearing in newspapers (Nielsen
Media Research; excluding classified ads and media
advertising). The lower advertising expenditures of nu-
merous sectors (particularly retail stores, textiles, tele-
communications, finance, and tourism) were not fully
offset by the higher advertising expenditures of other
sectors, such as automobiles, services, personal care
articles, other transportation, and beverages, for example.
The negative development in the retail sector can be
attributed mainly to the reduced volume of ads for tech-
nology retailers and discount retail chains. Furthermore,
the figure for 2010 was elevated as a result of additional
advertising expenditures related to the Soccer World Cup.
According to Zeitungs Marketing Gesellschaft (ZMG), the
net ad volume of regional subscription newspapers
(including classified ads) in 2011 was 4.2 % less than
the corresponding figure in 2010. The development
reflects the lower volume of classified ads related to real
estate, events, travel, and family notices, in particular.
Along with the automotive market (+ 7.8 %), the volume
of help-wanted ads (+ 14.1 %) was considerably higher
in 2011, thanks to the improved situation of the jobs
market. For the full year 2011, the ad volumes of national
newspapers (including classified ads) were 5.2 % lower,
on average, than the corresponding figure for 2010
(S+H Medienstatistik).
According to Nielsen, general-interest magazines
generated gross advertising revenues (excluding media
advertising) of € 2.7 billion, reflecting a very small increase
of 0.3 % over the prior-year figure. Whereas monthly
women’s magazines (+ 7.8 %), supplements (+ 14.5 %),
the automotive press (+ 5.4 %), and home and garden
magazines (+ 5.6 %) registered the biggest gains, other
categories, including illustrated current-interest magazines
(– 2.9 %), weekly women’s magazines (– 5.0 %), IT/tele-
communications magazines (– 3.8 %), and sports maga-
zines (– 3.5 %), generated lower advertising revenues.
According to Nielsen Media Research, the gross adver-
tising revenues (excluding media advertising) of the Ger-
man online market (conventional banner advertising,
excluding search term marketing and affiliates) amounted
to € 2.8 billion in 2011, reflecting an increase of 22.6 %
over the corresponding year-ago figure. This gain was
driven mainly by increases in the sectors of finance, the
automotive market, telecommunications, personal care
products, food, and computers. Also in the online market,
the development of gross advertising revenues does not
adequately reflect the real trend.
Combined Management Report 47
Business and framework conditions
Significant events affecting Axel Springer’s
performance in 2011
In pursuit of our digitization strategy, we expanded the
Group’s digital portfolio significantly in 2011, mainly
through the acquisition of SeLoger in early March 2011.
Through this acquisition of the leading online real estate
portal in France, we expanded our activities further in
the segment of online classified ad markets and thus
strengthened one of the three main pillars of our digitiza-
tion strategy. Together with the management of SeLoger,
we intend to pursue the continued successful develop-
ment of this company. An important first step in the
direction of internationalization was the acquisition of
roughly 17.3 % of the equity of the iProperty Group
(formerly IPGA), in June 2011. Based in Sydney, Australia,
this company operates the leading network of real estate
portals in southeast Asia. Another milestone was the
acquisition of the French Internet portal for vacation
properties, a-gites.com, in October 2011. Through the
acquisition of this online provider of vacation homes and
apartments, SeLoger further extended its market leader-
ship position in the segment of online real estate portals
in France.
Another important step taken to expand the Group’s
digital portfolio was the acquisition of a majority interest
(74.9 %) in kaufDA (www.kaufda.de), in early March
2011. kaufDA offers retailers the chance to advertise
their offerings on a location-sensitive basis via the mobile
and stationary Internet, so that consumers can plan their
shopping either from home or on the road. In December,
kaufDA took its first internationalization step by launching
the online platform BONIAL (www.bonial.fr) in France.
According to Nielsen Media Research, the gross advertis-
ing revenues (excluding media advertising) of advertising-
financed TV in Germany amounted to € 10.3 billion in 2011,
reflecting an increase of 1.7 % over the corresponding
prior-year figure. Whereas the gross advertising revenues
of private-sector TV stations rose by 1.7 % to € 9.9 billion,
those of state-owned TV stations rose by 2.7 % to
€ 387.1 million.
At € 1.2 billion, the gross advertising revenues (excluding
media advertising) of radio stations were 1.4 % higher
than the corresponding prior-year figure. The gross ad-
vertising revenues of state-owned radio stations rose by
6.6 %, while those of private-sector radio stations con-
tracted by 0.8 %.
The gross advertising revenues of billboard advertising
amounted to € 982.2 million in 2011, reflecting an in-
crease of 10.2 % over the corresponding prior-year figure.
Anticipated Advertising Activity 2011 (Selection)
Change in net ad
revenues compared
to prior year
(nominal)
Germany
Switzerland1)
France2)
Spain2)
Hungary
Poland2)
Newspapers Magazines
– 1.7 %
4.8 %
0.7 %
4.0 %
– 3.0 %
– 3.0 %
Online
12.7 %
5.1 %
9.5 %
– 11.6 %
– 6.0 %
10.0 %
1.2 %
– 6.1 %
9.0 %
– 8.1 %
– 6.1 %
15.4 %
Czech Republic2)
– 16.0 %
– 7.0 %
16.4 %
Slovakia1)
Serbia1)
Russia
India2)
– 2.3 %
– 7.9 %
4.0 %
– 7.0 %
– 10.5 %
14.3 %
7.0 %
11.5 %
52.0 %
12.5 %
15.0 %
29.9 %
Source: ZenithOptimedia, Advertising Expenditure Forecast (December) 2011.
1) Gross advertising revenues (excluding classified ads of print media). Gross advertising
revenues do not adequately reflect the actual development of advertising revenues.
2) Excluding classified ads.
48 Annual Report 2011 Axel Springer AG
In June, Europe’s performance advertising network
zanox purchased all the shares of the Dutch affiliate
marketing network M4N, thereby securing a market
leadership position in the Benelux countries. This acqui-
sition represents another important step in realizing the
growth strategy of the zanox Group. Local and interna-
tional advertising customers stand to benefit from the
wider reach of the combined network.
In early August 2011, aufeminin.com continued its
international expansion by purchasing all the shares in
netmums.com, the leading British website related to
children and parenting. By means of this acquisition,
aufeminin.com also advanced to the status of market
leader in the segment of women’s portals in Great Britain.
In September, Mondadori France and Axel Springer
France jointly purchased 83.0 % of the French automo-
tive classified-ad portal AutoReflex.com. This transac-
tion was finalized in the fourth quarter of 2011. The ac-
quisition was effected by a newly formed holding com-
pany, Editions Mondadori Axel Springer Digital (EMAS
Digital), in which Axel Springer France and Mondadori
France each hold a 50 % equity interest; AutoReflex.com
is fully consolidated with Axel Springer. Axel Springer
and Mondadori France have already been cooperating
successfully in France for many years.
In mid-December 2011, Axel Springer purchased a ma-
jority interest (77.7 %) in Visual Meta GmbH. Founded
in 2008, this German company operates shopping por-
tals, such as ladenzeile.de, for example, in seven Euro-
pean countries, in which the product offerings of numer-
ous online shops are consolidated on the basis of a
visual product search.
According to information provided by Do⁄an Yayin
Holding A.S., the tax proceedings involving Do⁄an TV
Holding A.S. and three of its subsidiaries were almost
completely settled in the first half of 2011, in exchange
for installment payments totaling roughly TRY 1 billion
(approximately € 0.4 billion). Based on a tax audit con-
ducted in September 2009, the Turkish tax authorities
had assessed various back taxes and other costs total-
ing TRY 3.9 billion (approximately € 1.7 billion), plus
interest. A smaller court proceeding aimed at clarifying
the legal issues related to sales taxes is still being pur-
sued. Based on the information available today, these
tax proceedings involving Do⁄an TV Holding and three of
its subsidiaries will have no effects on Axel Springer AG.
In consideration of the amicable settlement of the tax
proceedings and the indemnification obligations assumed
by Do⁄an Yayin Holding A.S., the latter has undertaken
vis-à-vis Axel Springer to furnish an amount equal to
€ 64.7 million for the purpose of participating in a capital
increase for Do⁄an TV Holding A.S. In return, Axel Springer
promised to use these funds for participating in the
capital increase. The capital increase was implemented
in August 2011.
Axel Springer’s joint venture with Ringier, Ringier Axel
Springer Media, is active in the four eastern European
countries of Poland, the Czech Republic, Slovakia, and
Serbia. For regulatory reasons, the planned contribution
of the Hungarian activities to the joint venture has been
delayed due to regulatory reasons. The Hungarian par-
liament adopted a new media law at the beginning of
2011. By virtue of that law, the planned merger of the
Hungarian activities of Ringier and Axel Springer was
made additionally subject to a media-law review, which
is procedurally integrated with the merger-law review. In
mid-April 2011, the Media Council issued a negative
recommendation, which is binding on the Cartel Office.
Therefore, Axel Springer and Ringier withdrew their ap-
plication for cartel-law approval in early May 2011. How-
ever, both companies still plan to merge their activities in
Hungary. Axel Springer and Ringier will jointly decide
whether to file a new application and if so, what form it
will take.
Combined Management Report 49
Business and framework conditions
Distinctions were also awarded to Axel Springer’s inter-
national media. For example, the news magazine RE-
FLEX, which is Axel Springer’s second-biggest magazine
in the Czech Republic, was selected as “Magazine of the
Year” by the Czech Publishers Association. REFLEX was
chosen mainly for its accurate and courageous reporting
and for its original and refreshing perspective on important
social, cultural, and political topics, which REFLEX has
demonstrated for two decades. And for the second year
in a row, REFLEX won the “Czech Press Photo 2010”
award, thereby retaining its title from the prior year. In
Switzerland, the Zurich Journalist Award was awarded
to journalists of BEOBACHTER for their article entitled
“A Dark Chapter,” which illuminated the fate of victims
of Swiss administrative justice in the early 1980s.
Performance of the company’s share price
Like other stocks, the share of Axel Springer AG was
adversely impacted by the turmoil affecting the capital
markets in 2011. At € 33.21, the share’s closing price on
December 30, 2011 was about one fifth less than it had
been at the beginning of the year (€ 40.67).
Comparison of actual business performance with
the forecast business performance
Having generated EBITDA of € 593.4 million (+ 16.2 %
over the prior year), Axel Springer met the earnings fore-
cast issued in March 2011, of increasing the Group’s
EBITDA by a percentage in the lower double-digit range.
Awards
Again in 2011 Axel Springer received numerous awards
in recognition of the journalistic excellence and outstand-
ing innovation performance of its publications. The na-
tional and international awards mentioned below repre-
sent only a selection of the total awards received.
Reporters and editors of BILD-Zeitung, the WELT
Group, BERLINER MORGENPOST, and HAMBURGER
ABENDBLATT received several important German jour-
nalism awards in 2011. The series entitled “Secret File
Greece” by two BILD reporters received two awards: the
highly coveted Herbert Quandt Media Award 2011 and
the State Street Prize for Financial Journalists 2011.
As Europe’s leading newspaper competition, the Euro-
pean Newspaper Awards has been awarded since 1999
to honor outstanding concept and design. In the main
category of regional newspapers, the international jury
awarded the main prize of “European Newspaper of the
Year” to BERLINER MORGENPOST. In addition, many
other newspaper brands of Axel Springer – such as BILD
am SONNTAG, HAMBURGER ABENDBLATT, and the
newspapers of the WELT Group – were awarded prizes
in various categories.
The website of bild.de, which was redesigned in 2011,
received the media award “kress Award 2011.” The jury
made its choice mainly on the basis of the website’s
highly professional appearance, the clear structure of its
organization, and its outstanding lifestyle and sports
sections. And that was not the only website of Axel
Springer AG to be honored in 2011. In the “Website
of the Year 2011” elections, three of our websites –
immonet.de, StepStone, and hamburg.de – were hon-
ored with the most important German audience-selected
award for websites, the “People’s Choice Award.” More
than 174 thousand users voted for the winners. And for
the third year in a row, the online marketer zanox was
voted the No. 1 among German affiliate networks and
agencies. The winner was chosen on the basis of a
survey conducted by the industry magazine iBusiness
and the website 100partnerprogramme.de.
50 Annual Report 2011 Axel Springer AG
Financial performance, liquidity, and
financial position
Financial performance of the Group
Axel Springer generated revenues of € 3,184.9 million
in 2011, reflecting an increase of 10.1 % over the corre-
sponding prior-year figure (PY: € 2,893.9 million), thanks
mainly to the higher revenues generated in the Digital
Media and Print International segments. Aside from
continued strong organic growth in the Digital Media
segment, consolidation effects, related in particular to
the consolidation of SeLoger and Ringier Axel Springer
Media, also contributed to the increase in revenues.
Adjusted for these effects, Axel Springer’s revenues were
3.9 % higher than the corresponding prior-year figure.
Additionally adjusted for currency effects, total revenues
were 3.7 % higher than the corresponding prior-year figure.
Revenues
€ millions
Circulation
Advertising
Other
The advertising revenues of € 1,606.8 million were 16.0 %
higher than the prior-year figure (PY: € 1,384.8 million),
mainly as a result of strong growth in the Digital Media
segment. The advertising revenues of the Group’s Ger-
man newspapers and magazines were slightly lower than
the respective prior-year figures. The advertising reve-
nues generated in the Group’s international print busi-
ness were boosted by consolidation effects related to
the joint venture Ringier Axel Springer Media in the first
half of 2011. In total, advertising revenues accounted for
50.5 % (PY: 47.9 %) of the Group’s total revenues.
At € 373.5 million, the other revenues were 11.6 %
higher than the corresponding prior-year figure (PY:
€ 334.8 million) and accounted for 11.7 % (PY: 11.6 %)
of total revenues. This increase was driven mainly by
growth in the Digital Media segment, as well as consoli-
dation effects related to the consolidation of Ringier Axel
Springer Media.
334.8
1,384.8
1,174.3
373.5
1,606.8
Segment Revenues 2011
Newspapers National
Magazines National
Print International
Digital Media
Services/Holding
1,204.5
30.2 %
2,893.9
2010
2011
3,184.9
At € 1,204.5 million, circulation revenues were 2.6 %
higher than the corresponding prior-year figure (PY:
€ 1,174.3 million) and accounted for 37.8 % (PY: 40.6 %)
of the Group’s total revenues. This increase resulted
mainly from consolidation effects related to the joint
venture Ringier Axel Springer Media in the Print Interna-
tional segment. The circulation revenues of the Group’s
German newspapers were on the level of the prior year
and those of the Group’s magazines were slightly lower
than the corresponding prior-year figure.
14.9 %
A comparison of segment revenues shows the diver-
gent development of Axel Springer’s German print media,
on the one hand, and international print media and its
digital media, on the other. Whereas the German print
media generated slightly lower revenues, the international
print media and the digital business demonstrated consid-
erable growth. In total, the revenues of Axel Springer’s
German newspapers declined by 2.4 % and those of
3.6 %
36.6 %
14.7 %
Combined Management Report 51
Financial performance, liquidity, and financial position
magazines by 3.7 %. By contrast, the total revenues of
the Print International segment rose by 18.1 %, due to
consolidation effects, and the total revenues of the Digital
Media segment jumped by 35.2 %, due to strong organic
growth, additionally intensified by consolidation effects.
International Revenues
€ millions
In percent of total revenues
28.1 %
812.3
The pro-forma revenues of the Digital Media segment
rose to € 994.2 million (PY: € 824.7 million), reflecting
organic growth of 20.6 %. Thus, the percentage of total
pro-forma revenues represented by the pro-forma reve-
nues of the Digital Media segment rose from 27.4 % to
30.9 %. The pro-forma revenues include the companies
acquired in 2010 and 2011 – primarily SeLoger, M4N,
and Perfiliate (buy.at) – on the basis of unaudited finan-
cial information. The revenues of divisions and compa-
nies that were sold during this period were subtracted
from the pro-forma revenues.
2010
2011
32.9 %
1,048.0
Digital Media Revenues (pro forma)
€ millions
In percent of total revenues
27.4 %
824.7
30.9 %
994.2
2010
2011
At € 1,048.0 million, international revenues were 29.0 %
higher than the corresponding prior-year figure and ac-
counted for 32.9 % (PY: 28.1 %) of Axel Springer’s total
revenues. This increase was driven both by the expanded
print business in eastern Europe and by the international
expansion of our digital activities.
The total expenses of € 2,830.0 million were 7.6 %
higher than the corresponding prior-year figure (PY:
€ 2,630.9 million), mainly as a result of consolidation
effects.
At € 1,055.7 million, purchased goods and services
were 11.1 % higher than the corresponding prior-year
figure (PY: € 950.6 million). This increase resulted mainly
from consolidation effects in the Print International and
Digital Media segments, as well as the organic growth of
our digital activities. It also reflected the impact of higher
prices for raw materials. However, the ratio of purchased
goods and services to total revenues was nearly un-
changed at 33.1 % (PY: 32.8 %).
The personnel expenses of € 851.6 million were 7.4 %
higher than the corresponding prior-year figure (PY:
€ 792.9 million), mainly as a result of newly consolidated
subsidiaries. The average workforce for the year was
11.4 % higher than the corresponding figure for the prior
year.
At € 138.8 million, depreciation, amortization, and
impairments were 22.3 % higher than the prior-year
figure of € 113.5 million. This increase resulted in part
from the heightened effects of purchase price allocations,
but also from impairments of goodwill, in the amount of
€ 7.8 million, which were recognized in 2011.
52 Annual Report 2011 Axel Springer AG
The other operating income fell to € 73.3 million (PY:
€ 150.1 million). The prior-year figure contained the profit
on the sale of StepStone’s Solutions division, in the
amount of € 73.7 million. At € 783.9 million, the other
operating expenses were little changed from the prior-
year figure (PY: € 773.9 million). The prior-year figure
contained the losses incurred on the sale of significant
activities of Axel Springer Financial Media, while the other
operating expenses for 2011 reflected higher advertising
expenses and the effects arising from the first-time con-
solidation of acquired companies.
The net investment income of € 9.5 million (PY: net
investment expenses of € – 8.2 million) resulted in part
from ongoing investment income, but it also contained
impairments of financial assets in the amount of
€ 9.6 million (PY: € 21.6 million). The operating net
investment income contained in the Group’s EBITDA
amounted to € 19.1 million (PY: € 17.0 million).
The net financial expenses amounted to € – 23.1 million
(PY: € – 31.2 million). The higher interest expenses in-
curred on the drawdowns of credit facilities were more
than offset by interest income on tax refund claims and
the non-recurrence of accrued tax interest.
The income taxes for 2011 amounted to € – 132.0 million
(PY: € – 103.6 million). Thus, the Group’s tax rate came to
31.3 % (PY: 27.4 %). The effective tax rate in 2010 had
been influenced by the fact that profits on the sale of
company shares were largely exempt from taxes.
At € 593.4 million, the earnings before interest, taxes,
depreciation, and amortization (EBITDA) were 16.2 %
higher than the corresponding prior-year figure and rep-
resented a new record. Non-recurring factors such as
the profits or losses on the sale of investments and pur-
chase price allocation effects, for example, are not con-
tained in EBITDA. The EBITDA margin of 18.6 % (PY:
17.6 %) impressively demonstrates the continued profit-
ability of Axel Springer’s business activities.
EBITDA
€ millions
EBITDA margin in %
17.6 %
510.6
18.6 %
593.4
2010
2011
The consolidated net income amounted to
€ 289.4 million (PY: € 274.1 million); adjusted for non-
operating effects, it amounted to € 343.3 million (PY:
€ 283.2 million).
Consolidated Net Income
€ millions
Consolidated net income
Non-recurring effects1)
Effects of purchase price allocations
Taxes attributable to these effects
2011
289.4
12.2
54.7
– 13.1
2010
274.1
– 17.1
33.6
– 7.3
Consolidated net income, adjusted
343.3
283.2
Attributable to non-controlling interest, adjusted
44.3
27.4
Adjusted consolidated net income
attributable to shareholders of
Axel Springer AG
299.0
255.8
1) The prior-year figure includes non-recurring effects and other non-operating effects.
Combined Management Report 53
Financial performance, liquidity, and financial position
The diluted earnings per share amounted to € 2.62 (PY:
€ 2.73). The adjusted diluted earnings per share attribut-
able to shareholders of Axel Springer AG, which are cal-
culated on the basis of the weighted average shares
outstanding in 2011, amounted to € 3.03 (PY: € 2.60).
The adjusted consolidated net income and the adjusted
diluted earnings per share are not defined under Interna-
tional Financial Reporting Standards and should there-
fore be regarded as supplementary information to the
consolidated financial statements.
Business developments and financial
performance of the segments
Newspapers National
With an average of 12.1 million readers, BILD successfully
defended its position as Europe’s widest-reach daily
newspaper in 2011. (Unless otherwise noted, reach
numbers for the German print titles are taken from ma
2012 Pressemedien I). In early May 2011, BILD raised
the newsstand price of most its regional editions in
western Germany and Berlin by € 0.10 to € 0.70. This
price increase affected about half of BILD’s total circula-
tion. After generating considerable attention in 2010 with
the publication of its first 3-D issue, Germany’s highest-
circulation and widest-reach daily newspaper published
its first issue in XXL format in August 2011. The sheets
comprising a surface area of eight DIN A4 sheets offered
an especially attractive display space for advertising cus-
tomers. In honor of German Unification Day on October 3,
2011, BILD also published a special edition to commemo-
rate the 21st anniversary of German reunification.
Despite its lower circulation in 2011, BILD am SONNTAG
extended its leading market position in the segment of
German Sunday newspapers by increasing its reach by 2.0 %
to a total 10.8 million readers. The newspaper raised the
newsstand price from € 1.50 to € 1.70 in the middle of
2011. In February 2011, BILD am SONNTAG launched an
advertising campaign modeled on BILD’s successful
“Confessor” campaign, featuring well-known celebrities
expressing their opinions of the Sunday newspaper.
Circulation and Reach Newspapers National
Thousands
Bild
Cir-
culation
20111)
Change
yoy
Reach2) Change
2,841.1
– 6.3 % 12,131.7
– 3.0 %
Bild am Sonntag
1,478.8
– 6.7 % 10,780.3
2.0 %
Die Welt/Welt Kompakt
252.0
– 1.2 %
844.6
19.2 %
Welt am Sonntag/
Welt am Sonntag
Kompakt3)
411.1
-
1,113.3
– 8.6 %
Hamburger Abendblatt
214.6
– 5.1 %
692.6
– 0.8 %
Berliner Morgenpost
124.8
– 4.0 %
363.5
1.3 %
B.Z./B.Z. am Sonntag
165.4
– 8.6 %
799.0
2.3 %
1) Source: IVW, average paid circulation.
2) Source: ma 2012 Pressemedien I, ma 2010 Pressemedien II.
3) It is not possible to measure the change in circulation compared to the prior year due to
different statistical populations.
In its 65th anniversary year, our premium newspaper DIE
WELT, together with the tabloid version WELT KOMPAKT,
exhibited the biggest reach increase of all national daily
newspapers in 2011. In total, 134.1 thousand more
readers were reached, reflecting an increase of 19.2 %
over the prior-year figure. These newspapers were also
successful in winning over younger readers. With an
average age of 45.3, WELT and WELT KOMPAKT
together have the youngest readers in their segment.
WELT am SONNTAG, the market leader among premi-
um Sunday newspapers, reached 1.1 million readers in
2011 and extended its lead over the competition, despite
reach losses. Together with its compact version, which
we introduced in five additional states of Germany,
WELT am SONNTAG achieved a paid circulation of
411.1 thousand copies.
54 Annual Report 2011 Axel Springer AG
BERLINER MORGENPOST is the only subscription
newspaper to have gained readers in the Berlin metro-
politan area. As part of our coverage of the election
campaign and elections for the Berlin parliament on
September 18, 2011, we published an additional tabloid
edition, BERLINER MORGENPOST KOMPAKT.
HAMBURGER ABENDBLATT, the most-read daily
newspaper in the greater Hamburg area, successfully
defended its market leadership position in Hamburg and
was again one of the most successful regional subscrip-
tion newspapers in Germany.
With an average daily paid circulation of about
165.4 thousand copies, B.Z. held on to its position as
Berlin’s biggest newspaper and the widest-reach daily
newspaper in the Berlin-Brandenburg circulation area.
With the aim of reinforcing the loyalty of our readers, we
introduced a lottery game in August 2011 developed
exclusively for B.Z. By means of a distinct code printed
on every copy of the newspaper published Monday
through Saturday during the campaigns, buyers have the
chance to win a cash prize every day. The Sunday version,
B.Z. am SONNTAG, was similarly successful in 2011,
having increased its reach in the Berlin-Brandenburg re-
gion by 47 thousand to 324 thousand readers. Contrary
to the general market trend, the regional advertising busi-
ness of B.Z. and its Sunday edition held up well in 2011.
Key Figures Newspapers National
€ millions
2011
2010
Change
External revenues
1,164.9
1,194.2
– 2.4 %
Share in cons. revenues
36.6 %
41.3 %
Circulation revenues
Advertising revenues
Other revenues
617.6
515.0
32.4
616.7
0.1 %
544.7
– 5.5 %
32.8
– 1.3 %
EBITDA
282.7
296.0
– 4.5 %
EBITDA margin
24.3 %
24.8 %
At € 1,164.9 million, the total revenues of the Newspa-
pers National segment were 2.4 % less than the corre-
sponding prior-year figure (PY: € 1,194.2). The circula-
tion revenues of € 617.6 million were nearly unchanged
from the prior year (PY: € 616.7 million), mainly due
to the higher sales price charged for some of BILD’s
regional editions in the second quarter of 2011. At
€ 515.0 million, advertising revenues were 5.5 %
less than the corresponding prior-year figure (PY:
€ 544.7 million). The decrease in advertising revenues
was greater for newsstand newspapers than for regional
newspapers; those of DIE WELT and WELT am
SONNTAG were slightly higher.
At € 282.7 million, EBITDA of the Newspaper National
segment was 4.5 % lower than the corresponding prior-
year figure (PY: € 296.0 million). Aside from the lower
revenues, higher paper costs also contributed to this
decrease. As a countervailing effect, restructuring ex-
penses were less than the corresponding prior-year
figure. The EBITDA margin was 24.3 % (PY: 24.8 %).
Magazines National
Axel Springer’s TV program guides and women’s
magazines exhibited a positive performance again in
2011. HÖRZU successfully defended its status as Ger-
many’s biggest weekly TV program guide. And with a
market share of 24.2 %, it was still the market leader
among higher-priced weekly TV program guides. Despite
the negative market trend, TV DIGITAL achieved a signif-
icant circulation increase. Furthermore, Germany’s first
TV program guide for digital television in the higher-
priced segment extended its reach by 351.6 thousand,
bringing the total to more than four million readers for the
first time. Thus, TV DIGITAL achieved the largest reach
increase of any magazine in 2011, and was also the
most successful magazine launch of the last ten years. In
November 2011, we sharpened our focus on the large
media brands HÖRZU, TV DIGITAL, and FUNK UHR by
selling the biweekly TV program guide TV Guide.
In the segment of women’s magazines, BILD der FRAU
reached 6.3 million readers in 2011, thus reaffirming its
market leadership position and its position as Germany’s
biggest German-language print medium for women.
Combined Management Report 55
Financial performance, liquidity, and financial position
Circulation and Reach Magazines National
Thousands
Hörzu
TV Digital
Cir-
culation
20111)
Change
yoy
Reach2) Change
1,339.8
– 4.4 %
4,248.0
– 3.0 %
1,820.8
6.1 %
4,364.5
8.8 %
Bild der Frau
946.1
– 4.4 %
6,323.4
0.9 %
Auto Bild
569.3
– 2.7 %
2,805.7
– 4.5 %
Computer Bild
555.3
– 9.5 %
4,313.7
– 0.5 %
Sport Bild
433.8
– 3.8 %
4,490.8
1.1 %
1) Source: IVW, average paid circulation.
2) Source: ma 2012 Pressemedien I.
Our market-leading automotive, computer, and
sports titles successfully defended or even extended
their dominant positions in the last 12 months.
With a market share of 56.7 % (based on paid circulation),
AUTO BILD held on to its uncontested market leadership
position in the segment of automotive magazines. AUTO
BILD was also the market leader in terms of reach. Of its
total average 2.8 million readers in 2011, 2.6 million were
male, meaning that AUTO BILD reached 7.7 % of all
German men. Among the specialty titles, AUTO TEST
was particularly successful in 2011. The circulation of
this buyer’s guide from AUTO BILD rose by 3.2 %,
thanks in part to the magazine’s successful relaunch.
Our other specialty titles showed positive developments
as well. By reason of its great success, AUTO BILD
KLASSIK has been published monthly since January
2011, causing its market share to rise by 9.1 % to 25.3 %.
Furthermore, AUTO BILD ALLRAD and AUTO BILD
SPORTSCARS extended their leading positions in their
respective segments.
Amid a difficult market environment, COMPUTER BILD
succeeded in keeping its reach stable, despite its lower
circulation. In the fiercely contested market of computer
game magazines, COMPUTER BILD SPIELE extended
its reach leadership position by reaching 65.3 thousand
more readers, bringing the total to 2.1 million.
Having achieved a slight increase in its market share
(+ 0.5 %), SPORT BILD affirmed its dominant position
among sports magazines. With a market share of 49.4 %,
it is currently well ahead, by 6.8 %, of the next-biggest
competitor. SPORT BILD also increased its reach in
2011. Furthermore, we expanded the editorial range of
SPORT BILD by publishing various special issues on
soccer, handball, and basketball.
Again in 2011, Axel Springer’s music magazines suc-
cessfully positioned themselves as exclusive and innova-
tive partners to the international music scene. For exam-
ple, we introduced the world’s first ROLLING STONE
app to the market in 2011. Our music magazines also
achieved a milestone in the print business by publishing
the first-ever single-topic, non-brand-dependent maga-
zine (“Auf der Straße mit Westernhagen”).
Key Figures Magazines National
€ millions
External revenues
2011
468.1
2010
Change
486.1
– 3.7 %
Share in cons. revenues
14.7 %
16.8 %
Circulation revenues
Advertising revenues
Other revenues
315.8
128.4
23.9
325.7
– 3.0 %
134.1
– 4.2 %
26.3
– 9.3 %
EBITDA
103.2
101.0
2.2 %
EBITDA margin
22.0 %
20.8 %
The revenues generated by the Magazines National
segment in 2011 were 3.7 % lower than the prior-year
figure. About half of this decline resulted from consolida-
tion effects related to the sale of titles in the prior year.
Adjusted for these effects, segment revenues were 1.8 %
less than the corresponding prior-year figure. At
€ 315.8 million, circulation revenues were 3.0 % less
than the prior-year figure; adjusted for consolidation
effects, the decrease was only 1.1 %. On balance, the
56 Annual Report 2011 Axel Springer AG
higher revenues generated by our automotive magazines,
TV DIGITAL, and BILD der FRAU were not enough to
offset the lower revenues of most other titles. Advertising
revenues were also slightly lower, declining 4.2 % in real
terms and 2.9 % after adjusting for consolidation effects.
In this respect, only the Group’s automotive, computer,
and music magazines defied the general trend by gener-
ating higher advertising revenues.
The segment EBITDA of € 103.2 million was 2.2 % higher
than the prior-year figure and marked a new all-time high.
The decrease in revenues was more than offset by efficiency
gains in nearly all areas. The EBITDA margin of 22.0 % was
higher than the prior-year EBITDA margin (PY: 20.8 %) and
likewise marked a new record.
Print International
Midway through 2010, we broadened our portfolio in
eastern Europe considerably through the joint venture
with Ringier AG. As a result of this merger, Ringier Axel
Springer Media now holds the leading market positions
in the segment of mass-circulation dailies in four coun-
tries of eastern Europe, namely Poland, the Czech
Republic, Slovakia, and Serbia. (See page 48 for
information on the status in Hungary.) The integration
activities within the joint venture that commenced after
the acquisition were successfully continued in 2011. As
in other western European countries, such as France
and Spain, for example, our cooperation in eastern
Europe is characterized by the intensive sharing of
knowledge and information among the countries.
Eastern European markets
Despite the deteriorating economic environment, Axel
Springer successfully defended its market positions and
introduced new products in Hungary. In the print seg-
ment, Axel Springer’s newspapers in Hungary, and par-
ticularly its women’s magazines, suffered an accelerated
decline of their respective reach figures. Amid these
adverse conditions, KISKEGYED’s reach losses were far
less than those of its competitors. It also strengthened its
market position as the widest-reach weekly women’s
magazine in Hungary (863 thousand readers). And our
style magazine GLAMOUR increased its market share
considerably in terms of paid circulation. In the segment
of Sunday newspapers, VASARNAP REGGEL extended
its market leadership position by keeping its circulation
stable. Axel Springer’s automotive and cooking maga-
zines were likewise successful in maintaining their circu-
lation numbers. Market share losses were offset particu-
larly by the magazine MINDMIGETTE RECEPTTAR,
launched in May as a spin-off of the cooking magazine
MINDMIGETTE, which was successfully introduced in
2010. Axel Springer’s regional magazines also defended
their market-leading positions.
Circulation and Reach Hungary (Selection)
Thousands
Kiskegyed
TVR-Hét
Circu-
lation
20111)
Change
yoy
Reach
20112)
Change
yoy
196.9
– 1.6 %
863.0
152.7
– 7.3 %
577.0
-
-
-
Vasárnap Reggel
142.9
– 2.3 %
632.0
1) Source: Hungarian Audit Bureau of Circulations, average paid circulation.
2) Source: Millward Brown-TNS- Q3/2010 to Q3/2011. Prior-year comparison is not
possible, due to the changed measurement method.
In cooperation with its customer Dell, Poland’s largest
mass circulation daily FAKT was the first to implement
the “People’s Product” concept internationally in 2011.
FAKT retained its status as Poland’s largest newspaper,
with an average circulation of 394.6 thousand copies
and a reach of 3.9 million readers. It raised its copy price
from PLN 1.40 to PLN 1.50 already in January 2011. In
August 2011, the first edition of the automotive magazine
TOP GEAR was launched under the direction of Ringier
Axel Springer Poland, after the joint venture entered into
a license agreement with the British Media Company
BBC Magazines in June.
Circulation and Reach Poland (Selection)
Thousands
Fakt
Newsweek
Auto Swiat
Circu-
lation
20111)
Change
yoy
Reach
20112)
Change
yoy
394.6
– 9.8 %
3,925.0
– 8.1 %
114.9
– 4.1 %
2,705.0
– 2.7 %
94.0
– 7.1 %
2,163.0
– 7.3 %
1) Source: ZKDP, Newsweek and Auto Swiat: January to November 2011 vs. January
to November 2010, average paid circulation.
2) Source: PBC General, January to October 2011 vs. January to October 2010.
Combined Management Report 57
Financial performance, liquidity, and financial position
As the leading publishing house in the Czech Republic,
Ringier Axel Springer Media expanded its portfolio further
last year by publishing various additions to its high-
circulation daily newspapers. We also established a total
of five integrated newsrooms. BLESK and AHA! performed
particularly well in 2011, jointly achieving a reach of
50.6 %, which is greater than the reach of all other daily
newspapers combined. We also increased the copy
price of both our daily newspapers in the Czech Republic,
raising the price of BLESK from CZK 9.00 to CZK 10.00
and the price of AHA! from CZK 7.50 to CZK 8.50. The
Sunday newspaper NEDELNI BLESK achieved the wid-
est reach of all Czech weekly titles. We also maintained
our market leadership positions in the segments of
women’s magazines and automotive magazines, and
strengthened our position considerably in the market of
crossword puzzle magazines.
Circulation and Reach
Czech Republic (Selection)
Thousands
Blesk
Circu-
lation
20111)
Change
yoy
Reach
20112)
Change
yoy
349.6
– 9.2 %
1,404.0
– 1.5 %
Circulation and Reach Slovakia (Selection)
Thousands
Circu-
lation
20111)
Change
yoy
Reach
20112)
Change
yoy
Novy Cas Vikend
202.3
– 3.3 %
556.4
– 9.5 %
Novy Cas pre zeny
138.8 – 15.2 %
335.7 – 13.2 %
Novy Cas
136.3
– 5.0 %
964.7
– 5.9 %
1) Source: ABC SR January to November 2011 vs. January to November 2010,
average paid circulation.
2) Source: MML-TGI, Median SK.
In Serbia, Ringier Axel Springer Serbia has been pub-
lishing the world’s leading automotive magazine AUTO
BILD since March 2011. Based on paid circulation, the
magazine attained a leading position in its segment right
from the start. Our mass-circulation dailies BLIC and
ALO! stabilized their market leadership positions In 2011
as well, BLIC was the most-read newspaper in Serbia,
with 907.4 thousand readers. And BLIC ZENA was also
the largest women’s magazine in that country. The
mass-circulation daily ALO! increased both its circulation
and its reach, again in 2011.
Nedelni Blesk
205.2
– 8.6 %
790.0
7.9 %
Circulation and Reach Serbia (Selection)
Blesk pro Zeny
196.1
0.6 %
746.0
14.9 %
1) Source: ABC CR, average paid circulation.
2) Source: Media Project, GfK Prague, Q2 to Q3 2011 vs. Q2 to Q3 2010.
In Slovakia, the daily newspaper NOVY CAS celebrated
its 20th anniversary by publishing an XXL issue in DIN A1
format, similar to the special edition published by the
German BILD. NOVY CAS successfully defended its
leading position in its segment by maintaining an average
paid circulation of 136.3 thousand copies and a market
share of 43.4 %. Amid a difficult economic environment,
NOVY CAS PRE ZENY held on to its market-leading
position among weekly women’s magazines, with a paid
circulation of 138.8 thousand and a market share of
27.2 %. We also opened our first integrated newsroom,
where we now produce all the editorial content used by
the NOVY CAS family of brands, both print and online.
We also added a new title, AUTO BILD SLOVAKIA, to
our Slovakian portfolio.
Thousands
Blic Zena
Blic
Alo!
Circu-
lation
20111)
Change
yoy
Reach
20112)
Change
yoy
180.0
– 9.6 %
805.9
– 6.8 %
134.3
– 8.3 %
907.4
0.6 %
114.6
1.1 %
474.5
3.9 %
1) Source: ABC Serbia January to November 2011 vs. January to November 2010,
average paid circulation.
2) Source: Ipsos Strategic Marketing.
In Russia, the news magazine FORBES extended its
reach leadership position further, increasing its reach by
2.7 % to 1.2 million readers. GALA BIOGRAFIA reached
836.9 thousand readers in 2011, reflecting an increase
of 2.3 % over 2010. COMPUTER BILD increased its
market share in its segment. GEO and GEO LENOK
(“GEO for children”) maintained their market shares and
increased their paid circulation in 2011.
58 Annual Report 2011 Axel Springer AG
Circulation and Reach Russia (Selection)
Thousands
Gala Biografia
Forbes
Geo
Circu-
lation
20111)
Change
yoy
Reach
20112)
Change
yoy
165.7
0.7 %
836.9
2.3 %
66.7 – 13.4 %
1,159.8
2.7 %
52.4
-
1,008.5
– 5.3 %
1) Source: Company data; January to October 2011 vs. January to October 2010;
average paid circulation.
2) Source: TNS Gallup, May to October 2011 vs. May to October 2010.
Western European markets
HANDELSZEITUNG, the market-leading business maga-
zine in Switzerland, celebrated its 150th anniversary in
May by publishing an 80-page special anniversary edition.
And our environmental protection and nature magazine
BEOBACHTER NATUR, which was launched only in 2010,
continued on a successful course in 2011, generating
significantly higher advertising revenues in its second year
and reaching a total of 406.0 thousand readers, based
on the first official reach measurement. The business
magazine PME MAGAZINE also reached more readers
in 2011 (+ 11.1 %).
Circulation and Reach Switzerland (Selection)
Thousands
Beobachter
Tele
Circu-
lation
20111)
Change
yoy
Reach
20112)
Change
yoy
301.2
– 1.7 %
990.0
3.1 %
145.9
0.6 %
531.0
– 0.6 %
Handelszeitung
36.3 – 11.0 %
131.0
– 2.2 %
AUTO PLUS, AUTO JOURNAL, and SPORT AUTO,
which are published by the joint venture Editions
Mondadori Axel Springer (EMAS), also maintained
their strong market positions.
Circulation France (Selection)1)
Thousands
Tele Magazine
Auto Plus3)
Vie Pratique Gourmand
Circulation
20112) Change yoy
310.2
300.7
193.5
– 8.0 %
3.9 %
– 2.0 %
1) Reach figures are not available, due to the conversion of the measurement method.
2) Source: OJD, July 2010 to June 2011 vs. July 2009 to June 2010, average paid
circulation.
3) EMAS: Joint venture with Mondadori.
Through international collaboration, we were also suc-
cessful in creating a print title from a website in Spain,
modeled on the successful French cooking magazine
MARMITON. To commemorate its 10th anniversary,
enfemenino.com published a collection of women’s mag-
azines, including COCINA GOURMET FOR enFeMININO,
the content of which was adapted from the French
MARMITON. Amid a persistently difficult economic envi-
ronment, our Spanish publications performed in line with
the general market trend in 2011, but they nonetheless
asserted their market-leading positions in the segments
of weekly automotive, computer, and video game maga-
zines. Our new magazine iCREATE, featuring content
related to Macs, iPhones, apps, and other Apple prod-
ucts, performed very well in 2011.
1) Source: WEMF: Auflagebulletin July 2010 to June 2011 vs. July 2009 to June 2010,
Circulation and Reach Spain (Selection)
average paid circulation.
2)Source: WEMF: MACH Basic April 2010 to March 2011 vs. April 2009 to March 2010.
Having been successfully introduced in France at the
end of 2010, MARMITON – the print version of the market-
leading cooking website marmiton.org, which belongs to
the portfolio of our subsidiary aufeminin.com – is now
published regularly every three months. And our biweekly
cooking magazine VIE PRATIQUE GOURMAND
maintained its market leadership position, based on paid
circulation. We also expanded our line-up of cooking
magazines by launching the bimonthly magazine
PAPILLES. Our three major automotive titles in France,
Thousands
Circu-
lation
20111)
Change
yoy
Reach
20112)
Change
yoy
Hobby Consolas
53.3
– 7.5 %
280.0 – 15.7 %
Computer Hoy
50.9 – 17.2 %
315.0
– 3.1 %
Auto Bild
27.5 – 15.5 %
109.0 – 14.2 %
1) Source: OJD, April 2010 to March 2011 vs. April 2009 to March 2010, average paid
circulation.
2) Source: AIMC EGM February to November 2011 vs. February to November 2010.
Combined Management Report 59
Financial performance, liquidity, and financial position
Key Figures Print International
€ millions
External revenues
2011
473.5
2010
Change
400.9
18.1 %
Share in cons. revenues
14.9 %
13.9 %
Circulation revenues
Advertising revenues
Other revenues
271.0
172.3
30.2
231.9
16.9 %
147.0
17.2 %
22.1
37.0 %
EBITDA
73.8
61.5
20.0 %
EBITDA margin
15.6 %
15.3 %
The revenues of the Print International segment exhibited
a mixed development over the course of the year. In the
first half, revenues were favorably influenced above all by
the initial consolidation of the companies contributed by
Ringier to the joint venture Ringier Axel Springer Media,
effective July 1, 2010. In the second half, revenues were
affected mainly by the appreciably worsening economic
conditions in the countries of eastern Europe.
At € 473.5 million, the external revenues of the Print
International segment were 18.1 % higher than the cor-
responding prior-year figure, mainly due to the revenue
contribution of the Ringier companies. Adjusted for con-
solidation effects, segment revenues were slightly less
(– 2.6 %), and adjusted additionally for currency effects,
they were 4.2 % less than the respective prior-year figures.
The circulation revenues of € 271.0 million were 16.9 %
higher than the prior-year figure, mainly as a result of the
newly acquired newspapers and magazines in the Czech
Republic, Serbia, and Slovakia in 2010, but also due to
higher circulation revenues in Switzerland. Adjusted for
consolidation effects, circulation revenues were slightly
less (– 2.1 %), and additionally adjusted for currency
effects, they were 4.0 % less than the respective prior-
year figures. At € 172.3 million, advertising revenues
were 17.2 % higher than the prior-year figure, mainly due
to the newly consolidated Ringier companies. Adjusted
for consolidation effects, advertising revenues were 4.4 %
less, and additionally adjusted for currency effects, they
were 6.0 % less than the respective prior-year figures.
Although slightly higher in Switzerland and Russia,
advertising revenues were lower in the other countries.
Segment EBITDA rose from € 61.5 million in 2010 to
€ 73.8 million in 2011. The EBITDA margin improved
slightly from 15.3 % to 15.6 %.
Digital Media
Content portals
The online portals of our German print publications per-
formed very well again in 2011. Bild.de extended its
leading position as Germany’s biggest news and enter-
tainment portal. In July, Bild Digital introduced a new
portal, stylebook.de, which is designed to tap a new
target group. Only shortly after its launch, this online
magazine devoted to stars, fashion, and beauty attracted
more than 3.6 million visits and has since become one of
the ten most successful German women’s portals. We
also successfully intensified our social media activities in
2011. The strong interest shown in Axel Springer’s me-
dia in the social networks is impressively demonstrated
by the fact that Bild.de has 500 thousand friends and
transfermarkt.de has 300 thousand friends on Facebook.
BILD’s mobile portal Bild.de Mobile which draws an
average of more than 29.4 million visits per month, is the
biggest German information portal for mobile devices.
Bild.de Mobile introduced the BILD “mini-phone” to the
market in December 2011. This mobile telephone, smaller
than a credit card and limited to the basic functions of
telephone calls and SMS, can be purchased along with
a BILDmobil SIM card.
WELT ONLINE, the news portal of the WELT Group,
continued on a course of growth by extending its visits
significantly over the prior-year number, once again. For
the full year, the total number of visits to this portal was
up 23.2 %, underscoring WELT ONLINE’s position as the
leading news portal among German premium newspa-
pers. The regional portals HAMBURGER ABENDBLATT
and BERLINER MORGENPOST also registered higher
visitor numbers compared to the prior year.
60 Annual Report 2011 Axel Springer AG
Traffic Figures Content Portals (Selection)
Millions
(monthly average)
aufeminin.com
Bild.de
computerbild.de4)
welt.de
azet.sk
Unique
Visitors
20111)
Change
yoy
Visits
20112)
Change
yoy
31.2
13.8 %
82.93)
8.2 %
9.8
8.3
0.5 %
172.3
18.2 %
-
34.6
-
4.6
– 2.9 %
36.0
23.2 %
2.4
55.3 %
41.55) – 16.0 %
onmeda.de
2.0
21.3 %
3.9
14.7 %
transfermarkt.de
1.9
10.5 %
22.0
17.0 %
fakt.pl
abendblatt.de
autobild.de
blesk.cz
forbes.ru
cas.sk
1.7
20.9 %
7.16) 28.6 %
1.6
14.9 %
9.6
38.0 %
1.5
8.2 %
6.9
23.3 %
1.4
49.6 %
13.47) 20.0 %
1.2
-
4.08) 49.6 %
1.1 > 100 %
9.45) 37.7 %
steps, the Development and Advertising Sales depart-
ments of azet.sk and Ringier Axel Springer Slovakia were
consolidated in 2011.
As the clear market leader among women’s portals in
France and other European countries, as well as in Great
Britain, following the acquisition of netmums.com,
aufeminin.com also generated substantial organic
growth in 2011. With an annualized average of
31.2 million unique visitors per month, the overall net-
work attracted more users than ever before, thanks in
part to a substantial increase in visitors to marmiton.org
and the Spanish website enfemenino.com. French users
confirmed the success of marmiton.org by voting it the
best-loved cooking website in France. The international
expansion of aufeminin.com was furthered by the acqui-
sition of netmums.com and the launch of aufeminin.com
in Tunisia.
1) Source: comScore.
2) Source: IVW.
3) Source: company data.
4) Including idealo.de since June 2011.
5) Source: AIM.
6) Source: Gemius Traffic.
7) Source: NetMonitor.
8) Source: XiTi Traffic Sources.
Thanks to the introduction of an integrated newsroom for
online and print content in Spain, autobild.es doubled its
traffic and page views in 2011.
Autobild.de successfully maintained its leadership posi-
tion in the segment of automotive websites featuring
editorial content. It also introduced a new feature, the
“AUTO BILD TESTER,” which, in combination with
motortalk.de, enables users to publish and comment
on their own test drives.
Our sports website transfermarkt.de also increased its
visitor numbers. Having added 179.0 thousand users, it
boasted 1.9 million unique visitors in 2011, 10.5 % more
than in the prior year, which had been especially favored
by the positive impact of the Soccer World Cup.
The content portals of our international print media also
exhibited a positive development in 2011. The websites
of Ringier Axel Springer Poland attracted 19.9 % more
unique visitors in 2011 than in 2010 (Gemius Traffic). And
fact.pl was only one of our content portals to increase its
reach substantially in 2011. In Slovakia, we continued to
integrate the online portal azet.sk, in which Axel Springer
had acquired a majority interest in 2010. Among other
gamigo.de, one of the leading European providers of
online games, expanded both its portfolio of games and
its base of players in 2011. The international versions of
its games also exhibited a positive development.
Smarthouse Media, a Europe-wide provider of complex,
web-based financial applications for banks, online bro-
kers, and other financial service providers, opened a
development office in Berlin, as part of its expansion
plans. It also established a new sales presence in the
financial center of London, in order to better serve its
clients there. Following the spin-off from Smarthouse
Media, the portal finanzen.net continued its positive
development as a separate company and extended its
position as the market leader in the financial portals
segment, both in terms of reach and IVW visits. Having
been launched in Switzerland in January 2012, finan-
zen.ch features real-time stock market news and securi-
ties data tailored specifically to the Swiss market, along
with editorial analyses and background reports, in coop-
eration with our investor magazine STOCKS.
Combined Management Report 61
Financial performance, liquidity, and financial position
The apps of our German print products, which are
designed for iPhones, iPads, and other mobile devices,
continued to perform very well in 2011. Axel Springer
now offers more than 35 paid apps for smartphones and
24 tablet apps. Besides expanding the range of mobile
apps for Apple products, we also introduced apps for
other smartphone operating systems, including Android
apps for BILD, immonet.de, idealo.de, and autoplus.fr.
Furthermore, the WELT Group introduced new apps for
the Kindle, the electronic reading device from Amazon,
and for Android tablets. Again in 2011, the iPad apps for
BILD and WELT were among the best-selling products in
the German Apple App Store.
In December 2011, the iKiosk app, which features a
wide range of content from Axel Springer’s newspapers
and magazines, came out with a new, expanded version,
including content from other publishers. You will find
additional information on this subject in the “Research
and Development” section on page 44. The iKiosk app is
now also available in Switzerland, where users can ac-
cess the online issues of the Group’s Swiss titles, as well
as other Axel Springer media brands, such as BILD,
BILD am SONNTAG, and DIE WELT, for example.
Also in our international markets, we further expanded
our range of apps for smartphones and tablet computers.
In the Czech Republic, for example, the website
sleviste.cz, which features up-to-date local discount
offerings, is now available as an iPhone app. In Slovakia,
Ringier Axel Springer rose to the status of market leader
in the news segment by introducing three apps for the
iPhone and iPad. Furthermore, the app for the Slovakian
daily newspaper NOVY CAS remained on the top-ten list
in the Apple App Store for a full seven months after being
introduced. The Russian business magazine FORBES
has also been available as an iPhone app since 2011. In
Switzerland, BEOBACHTER and BEOBACHTER NATUR
have been offered in the form of e-magazines for the
iPad and iPhone since January 2011. In Spain, we now
offer three apps in the Apple App Store, including a
recipe app modeled after the successful French app for
igourmand.fr.
Online marketplaces
Our online marketplaces continued to perform very well
in 2011.
SeLoger increased its reach further in 2011, both on the
stationary Internet and in mobile apps. It also introduced
innovative new products for users and customers, includ-
ing a do-it-yourself campaign management tool, which real
estate agents can use to design their own campaign and
place it on seloger.com. It also broadened its range of
mobile apps by introducing versions for the Microsoft Win-
dows Phone operating system. And SeLoger’s subsidiary
Poliris, in which SeLoger’s service and software activities
are bundled, including the web agency and France’s
leading real estate software Pericles got off to a promis-
ing start in 2011. Furthermore, SeLoger made its first
step in the direction of internationalization by acquiring
the vacation homes portal a-gites.com in France and by
purchasing shares in the iProperty Group (see page 47).
immonet.de continued the growth program it had
launched in the German real estate market at the begin-
ning of the year by starting another print campaign in
May. Thanks to the cooperation with eBay, visitors to
that online marketplace have been able to directly ac-
cess immonet.de’s residential listings since 2011, which
has extended the reach of the real estate portal. Further-
more, immonet.de broadened its offering further by
launching ImmonetManager, a mobile brokerage software
program for administering property data, inquiries, ap-
pointments, and contacts; it is also available as an app.
Benefiting from the positive market environment, Step-
Stone – the most-visited German online jobs exchange
according to IVW’s ranking – continued on a course of
strong growth by increasing its volume of job listings sub-
stantially. Following the successful acquisition of the tech-
nology company Jobanova at the beginning of 2011, the
integration has proceeded so well that StepMatch, the
new search algorithm based on Jobanova’s technology,
has since been introduced in the Netherlands and Norway,
after first being introduced in Germany and France.
62 Annual Report 2011 Axel Springer AG
As the widest-reach portal for product searches and
price comparisons in Germany, idealo.de increased the
number of referred search queries by 42.8 % over the
corresponding prior-year figure. Moreover, idealo.de
benefited considerably from the changes made to the
search algorithm of Google’s search engine, both in
absolute terms and in relation to its competitors, thereby
reaffirming the impressive quality and strong market
position of idealo.de. In addition, the price comparison
platform also intensified and expanded its strategic part-
nership with computerbild.de, so as to mesh the product
knowledge of both websites even more effectively.
Marketing
In 2011, we further extended the Group’s leading Europe-
wide position in the business of performance-based
online marketing, which is at the heart of our third area of
core expertise.
The zanox Group (including the affiliate networks Digital
Window and buy.at), Europe’s leading network for per-
formance-based marketing, in which Axel Springer owns
a majority interest, generated organic growth and made
new acquisitions in 2011. Besides opening a total of four
new locations outside Germany, zanox acquired the
Dutch affiliate marketing network M4N, thereby attaining
the leading market position in the Benelux countries (see
page 48). As a result of the company’s growing interna-
tionalization, zanox currently operates 13 locations
around the world. In December 2011, moreover, it
launched the new “zanox marketplace.” As the first
European marketplace for performance advertising, it is a
completely new kind of platform that customers can use
for performance-based online advertising on the national
and international levels.
kaufDA, the provider of online brochures and local shop-
ping offers with information on roughly 200 thousand
retail stores, further extended its reach leadership posi-
tion in 2011. Furthermore, the digital brochures of
kaufDA’s customers in the respective areas can now be
downloaded directly from morgenpost.de and abend-
blatt.de. Thus, the current regional shopping offers pre-
sented in the kaufDA network reach a total of roughly
12 million users per month. Also in 2011, kaufDA intro-
duced a new product to the market, the mobile shop-
ping guide “kaufDA Navigator” for Windows and Nokia
smartphones. And the consumer information portal took
its first step in the direction of internationalization in 2011
by launching the new online platform BONIAL in France.
TV/radio activities
In collaboration with Talpa Distribution BV, with which
Axel Springer closely operates, Axel Springer’s TV pro-
duction company Schwartzkopff TV produced the hit
prime-time music casting show “The Voice of Germany,”
which earned top ratings on ProSieben and Sat.1. The
radio market experienced moderate growth in 2011,
despite the subdued development in the fourth quarter.
Amid this environment, the radio stations in which Axel
Springer holds investments performed well in 2011.
Key Figures Digital Media
€ millions
External revenues
2011
962.1
2010
Change
711.8
35.2 %
Share in cons. revenues
30.2 %
24.6 %
Advertising revenues
Other revenues
791.2
170.9
559.0
41.5 %
152.9
11.8 %
EBITDA
158.1
85.8
84.2 %
EBITDA margin
16.4 %
12.1 %
At € 962.1 million, the total revenues of the Digital Media
segment were considerably higher, by 35.2 %, than the
corresponding prior-year figure. The advertising revenues
of € 791.2 million rose by an even larger percentage of
41.5 %. This increase was driven both by strong organic
growth, particularly at StepStone, zanox, and idealo, and
by consolidation effects associated mainly with SeLoger,
M4N, buy.at, and the digital activities of Ringier Axel Springer
Media. At € 170.9 million, the other revenues were 11.8 %
higher than the corresponding prior-year figure.
Combined Management Report 63
Financial performance, liquidity, and financial position
The pro-forma revenues of the Digital Media segment
amounted to € 994.2 million (PY: € 824.7 million), re-
flecting organic growth of 20.6 %. Thus, the percentage
of total pro-forma revenues represented by pro-forma
digital media revenues rose from 27.4 % to 30.9 %.
At € 158.1 million, segment EBITDA was 84.2 % higher
than the prior-year figure. That increase was far higher
than the growth of revenues. Adjusted for consolidation
effects, it was 33.5 % higher than the corresponding
prior-year figure. This substantial increase was driven by
higher earnings in all three core areas of expertise: online
marketplaces, content portals, and performance-based
marketing. The EBITDA margin also showed a significant
increase, from 12.1 % to 16.4 %.
Services/Holding
The Services/Holding segment comprises the Group’s
three own newspaper printing plants in Germany, as well
as the internal department of Logistics and various other
service and holding company functions.
Key Figures Services/Holding
€ millions
External revenues
2011
116.2
2010
Change
100.8
15.3 %
Share in cons. revenues
3.6 %
3.5 %
EBITDA
– 24.4
– 33.7
-
At € 116.2 million, the external revenues of the Services/
Holding segment were higher than the prior-year figure of
€ 100.8 million. The increase was driven by higher reve-
nues from services and the Group’s printing plants.
Segment EBITDA improved from € – 33.7 million in 2010
to € – 24.4 million in 2011, due in particular to the lower
expenses associated with share-based compensation.
Liquidity
Financial management
As a general rule, Axel Springer AG provides all financing
for the Axel Springer Group. This arrangement ensures
that the Group companies have sufficient liquidity at all
times. The overriding goal of financial management is to
provide cost-effective liquidity by means of maturity-
matched financing. Also, we seek to earn an appropriate
return by investing surplus cash.
Net Liquidity/Debt
€ millions
Cash and cash equivalents
Financial liabilities
Net liquidity/debt
2011
244.0
716.9
– 472.8
2010
435.9
356.2
79.6
At December 31, 2011, Axel Springer carried a net debt
of € 472.8 million (PY: net liquidity of € 79.6 million). The
€ 191.9 million decrease in cash and cash equivalents
and the € 360.6 million increase in financial liabilities
resulted mainly from the acquisitions of SeLoger and
other subsidiaries, which were completed in 2011.
Axel Springer has access to various credit facilities, in-
cluding a credit line in the total amount of € 1.5 billion,
which can be used both for general business purposes
and for financing acquisitions. Of this credit line, an amount
of up to € 0.5 billion will fall due in 2012 and an amount of
up to € 1.0 billion in 2013, depending on the drawdowns
to be effected in the meantime; an amount of € 635 million
was drawn down under this credit line at December 31,
2011. The total amount of available, unutilized short-term
and long-term credit facilities at December 31, 2011 was
€ 885.0 million (December 31, 2010: € 1,245.0 million).
64 Annual Report 2011 Axel Springer AG
Cash flows and capital expenditures
Consolidated Cash Flow Statement (Condensed)
€ millions
Cash flow from continuing operations
2011
405.9
2010
358.1
Cash flow from investing activities
– 701.2
– 200.6
Cash flow from financing activities
Change in cash and cash equivalents
109.1
– 186.2
Cash and cash equivalents at December 31
244.0
76.1
233.6
435.9
The cash flow from operating activities rose to
€ 405.9 million (PY: € 358.1 million), mainly as a result
of the improved operating performance. Tax payments
pertaining to prior years were the main reason why this
increase was not as great as the increase in EBITDA.
The cash flow from investing activities amounted to
€ – 701.2 million (PY: € – 200.6 million). This develop-
ment resulted mainly from the payments made in con-
nection with the acquisition of SeLoger and other subsid-
iaries. These cash outflows were partially offset by cash
receipts of the first installment payments on the partially
deferred purchase price for the regional newspaper
investments that were sold in 2009. The prior-year cash
flow from investing activities was mainly influenced by
payments for the formation of the joint venture Ringier
Axel Springer Media and the acquisition of shares repre-
senting approximately 12.4 % of the equity of SeLoger.
These cash outflows were partially offset by cash re-
ceipts from the sale of StepStone’s Solutions Division
and other investments.
The cash flow from financing activities amounted to
€ 109.1 million (PY: € 76.1 million). Further drawdowns
were made on the credit facility in connection with the
acquisition of SeLoger and other companies in 2011.
The cash inflow was reduced by the dividend payment
for financial year 2010, and also by the payment of cash
funds to the pension fund Axel Springer Pensionstreu-
hand e. V. in the amount of € 25.0 million, which was
formed in 2011 to cover the company’s pension obliga-
tions. The prior-year figure had been influenced by cash
inflows from the sale of treasury shares (€ 261.9 million),
and particularly by the placement of treasury shares that
was effected in September 2010, which more than offset
the amounts applied to reduce financial liabilities and pay
the dividend.
The net balance of cash flows from operating
activities, investing activities and financing activities was
€ – 186.2 million (PY: € 233.6 million). At December 31,
2011, cash and cash equivalents (cash and term depos-
its and securities maturing in the near future) amounted
to € 244.0 million (PY: € 435.9 million).
Financial position
Consolidated Balance Sheet (Condensed)
€ millions
Non-current assets
Current assets
Assets
Equity
Non-current liabilities
Current liabilities
Equity and liabilities
12/31/2011 12/31/2010
3,308.9
2,569.7
878.5
1,033.5
4,187.5
3,603.2
1,930.8
1,772.6
1,382.8
1,003.5
873.9
827.2
4,187.5
3,603.2
At € 4,187.5 million, the total assets presented in the
consolidated statement of financial position at December
31, 2011 were higher than the corresponding figure at
December 31, 2010 (€ 3,603.2 million) by € 584.2 million
or 16.2 %. The development in 2011 was particularly
influenced by the acquisition of SeLoger in early March
2011 and by other acquisitions in the Digital Media seg-
ment. In connection with the provisional allocation of the
purchase price paid for SeLoger (€ 624.8 million), intan-
gible assets (including goodwill) were recognized in the
total amount of € 698.1 million.
Combined Management Report 65
Financial performance, liquidity, and financial position
The carrying amount of the 12.4 % investment in SeLoger
that had been purchased in 2010 (€ 72.5 million) and
presented in the consolidated statement of financial posi-
tion at December 31, 2010 as a non-current financial
asset was derecognized in connection with the initial
consolidation of that company. The item of non-current
financial assets also includes the 17.3 % investment in
iProperty.com that was purchased in 2011.
The € 25.8 million decrease in non-current other assets
resulted mainly from the receipt of the first two installment
payments for the sale of regional newspaper investments.
At € 442.4 million, trade receivables were higher than the
corresponding prior-year figure by € 56.5 million or
14.6 %. This increase resulted mainly from the initial
consolidation of companies acquired in 2011 and from
the greater volume of operating business, particularly in
the Digital Media segment.
At € 1,930.8 million, the Group’s equity was
€ 158.1 million (8.9 %) higher than the corresponding figure
at December 31, 2010, despite the payment of a dividend
for financial year 2010 in the amount of € 157.3 million. The
increase in the Group’s equity resulted primarily from the
consolidated net income and from the higher amount of
equity held by non-controlling interests. The equity ratio fell
to 46.1 % (PY: 49.2 %), mainly due to a higher amount of
drawdowns under the credit facility.
The non-current provisions and liabilities of € 1,382.8 million
were higher than the corresponding prior-year figure
(December 31, 2010: € 1,003.5 million), mainly due to
the incurrence of financial liabilities and the recognition of
deferred tax liabilities and contingent purchase price liabili-
ties related to company acquisitions. The increase was
partially offset by the decrease in pension provisions,
which resulted from the adjustment of the discount factor
from 4.6 % to 5.0 %, and by the contribution of cash to the
newly formed Axel Springer Pensionstreuhand e.V., for the
purpose of financing the company’s pension obligations.
The current provisions and liabilities of € 873.9 million
were higher than the corresponding prior-year figure
(December 31, 2010: € 827.2 million). Among the most
important developments, other liabilities increased by
€ 30.4 million and other provisions decreased by
€ 6.7 million. These developments were caused in part
by the first-time consolidation of acquired companies,
but also largely by the utilization of restructuring provi-
sions. Current income tax liabilities were € 18.9 million
less than the corresponding prior-year figure, mainly as
a result of tax payments made in respect of prior years.
Furthermore, an amount of € 40.2 million that had for-
merly been classified as non-current loan liabilities was
reclassified as current, because it will be due and paya-
ble next year.
Employees
Excluding vocational trainees, journalism students, and
interns, Axel Springer had an average of 12,885 (PY:
11,563) employees in 2011. The 11.4 % increase of the
prior year resulted mainly from the newly consolidated
companies. An average number of 4,459 employees
(PY: 3,990), corresponding to 34.6 % (PY: 34.5 %) of the
Group’s total workforce, were employed outside of Ger-
many. On average, Axel Springer employed 5,505 wom-
en and 7,380 men. The number of reporters and editors
rose by 231 to 3,685 in 2011. The number of salaried
employees rose by 973 to 8,217 – mainly due to the
expansion and acquisition of investments in the Digital
Media and Print International segments.
Employees by Segments
Average number per year
Newspapers National
2011
2,600
2010
Change
2,613
– 0.5 %
Magazines National
978
1,041
– 6.1 %
Print International
Digital Media
Services/Holding
3,587
3,029
2,691
3,054
17.5 %
2,426
24.9 %
2,429
10.8 %
Group
12,885
11,563
11.4 %
66 Annual Report 2011 Axel Springer AG
The total number of employees working in the Newspa-
pers National and Magazines National segments was
lower than the corresponding prior-year figure, partially
due to the fact that various German magazine titles were
sold in 2010. The substantial increase in the number of
employees working in the international print business and
in the digital media area can be attributed in part to the
consolidation of the Ringier companies in connection with
the formation of Ringier Axel Springer Media from mid-
2010, and to the consolidation of SeLoger in March 2011.
The higher number of employees working in the Services/
Holding segment compared to the prior year resulted
from the first-time consolidation of food service and
event organization activities.
Length of service and age structure
As of December 31, 2011, the average employee of Axel
Springer’s German subsidiaries has been with the com-
pany for 11.5 (PY: 12.2) years; 52.0 % (PY: 54.0 %) of
the workforce has been with Axel Springer Group for
longer than ten years. More than half of all employees
are between the ages of 30 and 49. In the German
companies, 3.7 % (PY: 3.8 %) of the average workforce
during the year were gravely handicapped persons.
General assessment of the economic
situation by the company’s management
Axel Springer was very successful in 2011, having gen-
erated record EBITDA and increased its revenues by
10.1 %. We continued to pursue our business strategy
with disciplined resolve, making great progress particu-
larly in the area of digitization, both through organic
growth and through acquisitions, especially SeLoger.
The EBITDA margin of 18.6 % impressively demonstrates
the profitable configuration of our Group.
Considering that the Group’s cash flow in 2011 was high-
er than the strong prior-year figure, as well as the compa-
ny’s extremely solid balance sheet structure and the cost-
effective financing options available to the company, Axel
Springer finds itself in a very good position to achieve
future growth, both organically and through acquisitions.
We continue to believe that the strategy of securing and
expanding our market leadership position in the German-
speaking world, accompanied by the internationalization
and especially the digitization of our business, is the right
way to preserve and, whenever possible, extend the com-
pany’s profitability in the future, and take advantage of op-
portunities arising from changing conditions in our markets.
Combined Management Report 67
Economic position of Axel Springer AG
Economic position of Axel Springer AG
€ millions
Revenues
Net income
Transfer to retained earnings1)
Total dividends1)
Dividend per share (in €)1) 2)
2011
2010
2009
2008
2007
1,551.2
1,576.6
1,588.3
1,673.3
1,669.1
260.2
161.3
92.6
4.0
167.6
157.3
1.70
1.60
323.1
165.4
131.2
1.47
196.4
103.6
130.6
1.47
147.8
25.3
122.4
1.33
1) The amount of the dividend for 2011 and the appropriation to the retained earnings (after deduction of an advance appropriation of € 92.0 million) are subject to the condition of
approval by the annual shareholders’ meeting.
2) The dividend per share for the years 2007 to 2010 were adjusted to account for the share split conducted in 2011.
Introductory remarks
The management report of the parent company Axel
Springer AG, Berlin, is combined with the management
report of the Axel Springer Group. The following state-
ments are based on the separate financial statements of
Axel Springer AG, which were prepared in accordance
with the regulations of the German Commercial Code
and the German Stock Corporations Act. The separate
financial statements of Axel Springer AG and the present
management report will be announced in the Electronic
Federal Gazette and published on the website of Axel
Springer AG.
Business activity
Axel Springer AG is the parent company of the Axel
Springer Group. The Management Board of Axel Sprin-
ger AG is also the managing body of the Group.
The Group’s major print publications, such as the titles
of the BILD Group and WELT Group, HAMBURGER
ABENDBLATT, TV DIGITAL, and HÖRZU, as well as
other newspaper and magazine titles, are editorially
produced and distributed by Axel Springer AG. The
newspapers are printed by the company’s own printing
plants in Ahrensburg, Berlin, and Essen, and by outside
printing companies.
In addition, Axel Springer AG maintains extensive suppli-
er and service relationships with subsidiaries and other
related parties. Purchased services mainly include print-
ing services, administrative services, property manage-
ment, direct marketing, editorial services, circulation, and
insurance services. Services rendered include the supply
of published products and paper and the provision of
general administrative and IT services.
As a general rule, Axel Springer AG provides financing to
the Group companies, as part of its Group-wide liquidity
management program. Profit/loss transfer agreements
are in effect with a number of German Group companies.
Financial performance
Income Statement (Condensed)
€ millions
Revenues
Other operating income
2011
2010
1,551.2
1,576.6
123.9
140.0
Purchased goods and services
– 411.5
– 408.6
Personnel expenses
– 424.6
– 433.3
Amortization, depreciation and
impairments of intangible assets and
property, plant and equipment
– 33.3
– 35.1
Other operating expenses
– 516.8
– 550.8
Net income from non-current financial
assets
Net interest income
Profit from ordinary activities
Taxes
Net income
Transfer to retained earnings
Distributable profit
96.2
– 26.2
358.9
6.2
– 23.4
271.6
– 98.7
– 110.3
260.2
– 92.0
168.2
161.3
– 3.0
158.3
68 Annual Report 2011 Axel Springer AG
Axel Springer generated slightly lower revenues in 2011
than in 2010. The advertising revenues of € 552.0 million
were 3.8 % less than the corresponding prior-year figure,
while the circulation revenues of € 863.4 million were only
0.8 % less and therefore very close to the level of the
prior-year figure. At € 135.7 million, the other revenues
were 2.2 % higher than the corresponding prior-year
figure, mainly as a result of higher printing plant revenues.
At € 358.9 million, the profit from ordinary activities was
€ 87.3 million higher than the corresponding prior-year
figure. After taxes, the net income for financial year 2011
amounted to € 260.2 million and was therefore
€ 98.9 million higher than the net income for financial
year 2010 (PY: €161.3 million).
Liquidity
At € 411.5 million, purchased goods and services were
only slightly less than the corresponding prior-year figure.
The effect of higher paper prices was almost completely
offset by lower paper consumption. The ratio of pur-
chased goods and services to total revenues remained
unchanged from the prior year, at around 26 %.
At December 31, 2011, Axel Springer’s net debt (liabili-
ties due to banks minus cash and cash equivalents)
amounted to € 620.1 million (PY: € 61.0 million). This
increase resulted mainly from the financing extended to
subsidiaries, especially for the acquisition of the French
real estate portal SeLoger.
The personnel expenses of € 424.6 million were 2.0 %
less than the corresponding prior-year figure. This
decrease resulted mainly from the lower restructuring
expenses, the lower cost of share-based compensation
and the lower number of employees, which declined
by 1.8 % from an average of 4,652 in 2010 to an average
of 4,569 in financial year 2011.
At € 33.3 million, the item of amortization, depreciation, ,
and impairments of intangible assets and property, plant
and equipment was 5.1 % less than the corresponding
prior-year figure, due in particular to the lower deprecia-
tion of property, plant, and equipment.
The other operating expenses were reduced by
€ 34.0 million or 6.2 % to € 516.8 million. This decrease
resulted mainly from lower selling expenses, consulting
expenses, and value adjustments of receivables.
Net income from non-current financial assets was
€ 90.0 million higher than the corresponding prior-year
figure, mainly as a result of the higher profit transfers
from subsidiaries (€ 50.5 million; PY: € 18.3 million)
under the newly concluded profit/loss transfer agree-
ments, and a dividend distribution by Axel Springer
Schweiz AG (€ 33.2 million). The lower amount of
impairments of investments (€ 16.4 million; PY:
€ 42.3 million) also had a positive effect.
At December 31, 2011, Axel Springer had access to
unutilized short-term and long-term credit facilities in the
total amount of € 885.0 million (PY: € 1,245.0 million).
The credit facilities can be used both for general busi-
ness purposes and for financing acquisitions.
Financial position
Balance Sheet (Condensed)
€ millions
12/31/2011 12/31/2010
Intangible assets and property, plant and
equipment
262.6
245.7
Non-current financial assets
2,711.3
2,000.2
Trade receivables
Receivables from affiliated companies
Cash and cash equivalents
Other assets
Total assets
Equity
Provisions
Liabilities due to banks
Liabilities to affiliated companies
Other liabilities
142.0
50.4
25.2
223.1
157.9
152.9
225.8
264.0
3,414.6
3,046.5
1,318.7
1,206.4
425.0
645.3
884.4
141.2
512.6
286.8
882.4
158.3
Total equity and liabilities
3,414.6
3,046.5
Combined Management Report 69
Events after the reporting date
2011, and to appropriate the remaining amount of
€ 0.6 million to the other retained earnings reserves.
The profit utilization proposal takes into account the
treasury shares held by the company, which do not
qualify for dividends. The number of shares qualifying for
dividends can change in the time remaining until the
annual shareholders’ meeting. In that case, an adjusted
profit utilization proposal will be submitted to the annual
shareholders’ meeting, without changing the target divi-
dend of € 1.70 per qualifying share.
Dependency Report
The Management Board of Axel Springer AG submitted
the Dependency Report prescribed by Section 312 of the
German Stock Corporations Act (AktG) to the Supervisory
Board and made the following concluding statement:
“According to the circumstances known to the manage-
ment at the time of each transaction with an affiliated
company, Axel Springer AG received adequate consid-
eration for every such transaction and did not take, or fail
to take, any actions in the reporting period, either at the
behest or in the interest of the controlling company or a
company affiliated with the controlling company.”
Events after the
reporting date
No developments or events of particular importance have
occurred since the reporting date of December 31, 2011.
At € 3,414.6 million, the balance sheet total in 2011
were 12.1 % higher than the corresponding prior-year
figure. Non-current assets amounted to € 2,973.9 million
(PY: € 2,245.9 million), representing 87.1 % (PY: 73.7 %)
of total assets. Non-current assets were backed by
equity at the rate of 44.3 % (PY: 53.7 %).
At € 2,711.3 million, non-current financial assets were
€ 711.1 million higher than the corresponding prior-year
figure, mainly due to payments made to the additional paid-
in capital reserves of subsidiaries for the purpose of financ-
ing acquisitions and optimizing the Group-wide financing
structures. These payments had the effect of reducing
receivables from affiliated companies (€ 50.4 million; PY:
€ 152.9 million); they also had the effect of reducing the
high level of cash and cash equivalents at the end of 2010
(€ 225.8 million) by € 200.6 million to € 25.2 million, and
raising liabilities due to banks by € 358.5 million to
€ 645.3 million.
The line item of other assets was affected by a payment
of € 25.0 million on the deferred purchase price for the
sale of regional newspaper investments effected in finan-
cial year 2009.
The very good net income for 2011 increased the equity
by € 112.3 million to € 1,318.7 million. The equity ratio
was 38.6 % at December 31, 2011 (PY: 39.6 %).
The provisions were € 87.6 million less than the corre-
sponding prior-year figure. This decrease resulted mainly
from the first-ever appropriation of assets to cover pen-
sion obligations, in the amount of € 50.0 million. Fur-
thermore, provisions for structural measures declined
by € 15.5 million.
Profit utilization proposal
The Supervisory Board and Management Board propose
that the company apply an amount of € 167.6 million
from the total distributable profit of € 168.2 million (PY:
€ 158.3 million) to pay a dividend of € 1.70 (PY: € 4.80;
in consideration of the share split effected in the mean-
time, that amount is mathematically equivalent to a divi-
dend of € 1.60) per qualifying share for financial year
70 Annual Report 2011 Axel Springer AG
Report on risks and opportunities
Risk policy principles and risk strategy
At Axel Springer, we define risks as the possibility of
negative deviations of actual business performance from
the planned performance or from our objectives, while
opportunities represent the possibility of positive devia-
tions. The risk policy principles and risk strategy of Axel
Springer are closely tied to the adopted business strate-
gy. We do not seek primarily to avoid risks at all costs,
but to carefully weigh the opportunities and risks associ-
ated with our business activities. Accordingly, opportuni-
ties should be systematically exploited and risks should
be assumed only when that would enable us to take
advantage of additional income opportunities and in-
crease the value of our company. Appropriate measures
are taken to minimize risks to an acceptable level or, if
economically feasible, transfer them to third parties. All
employees are obliged to handle risks responsibly within
their own work areas.
Refined risk management system
In consideration of the heightened national and interna-
tional requirements, we continued the process of sys-
tematically refining our internal monitoring system (risk
management, compliance management, internal control
system, and internal auditing) in 2011. To ensure the
close coordination of the various sub-systems, the de-
partment Governance, Risk & Compliance coordinates
risk management, compliance management, and the
internal control system.
Axel Springer’s risk management system is designed to
identify all significant risks at the earliest possible stage,
so that we can immediately take appropriate counter-
measures and monitor the further progression of all risks
and the corresponding risk management measures. This
approach gives us the necessary maneuvering room and
allows for the controlled handling of risks. The risk man-
agement system is designed to meet the demands of
currently applicable laws and regulations, as well as
nationally and internationally recognized standards, and
is documented in a corresponding corporate directive.
Whereas the overall responsibility for risk management
lies with the Management Board, the management of
individual risks, which entails the early detection, assess-
ment, management, and documentation of risks, as well
as the adoption and implementation of appropriate
countermeasures and the associated reporting require-
ments, lies primarily with the corresponding corporate
divisions or Group companies.
The divisional leaderships bear content-related respon-
sibility for the risk management conducted within their
respective divisions. Besides conducting a structured
risk inventory every year, they are also obliged to monitor
their divisions on a continuous basis in order to identify
any changes in the risk situation. Significant changes
in the division-specific risk situation must be reported
promptly to the Governance, Risk, & Compliance
department or the Management Board.
In addition to this decentralized risk identification process,
a centralized risk identification process is conducted
under the coordination of the Group-wide Risk Manager,
who is a member of the senior management. The pur-
pose of that process is to apply specialized methodology
with the goal of identifying and assessing cross-divisional
and process-transcending risks, so as to complete the
risk inventory.
Risks are assessed on the basis of the probability of
occurrence and the possible loss in case of occurrence.
Risks are classified as “existentially threatening,” “material,”
or “to be monitored.” In order to present Axel Springer’s
risk situation as transparently as possible, risks are as-
sessed by means of a procedure that entails both a gross
assessment (before risk management measures) and a net
assessment (after risk management measures). Uniform,
Group-wide materiality limits are applied for that purpose.
A theoretically existential risk is classified as such on the
basis of the possible gross loss and the effect of such a
loss on the Group’s financial position and liquidity.
The Corporate Risk Manager is assigned to the new
department of Governance, Risk, & Compliance. He
monitors all risk management activities, aggregates the
risks at the Group level, and assesses the plausibility and
completeness of reported risks. He is also responsible
for continuously refining the risk management system
and the Group-wide, web-based reporting tool.
The risk reports prepared for the Management Board
and Supervisory Board focus primarily on the existentially
threatening risks and material risks, including the corre-
Combined Management Report 71
Report on risks and opportunities
sponding risk management measures and suitable early
warning indicators, if any. For that purpose, we distin-
guish mainly between strategic and operational risks,
financial reporting risks and risks related to compliance
with internal and external regulations.
Internal audit system
Axel Springer AG has a Corporate Internal Audit Depart-
ment that conducts its work independently of instruc-
tions and processes, on the basis of internal rules of
procedure adopted by the Management Board. The
Corporate Internal Audit Department is designed to fulfill
the relevant national and international professional
standards.
Based on a risk-oriented audit plan, the Corporate Inter-
nal Audit Department continuously reviews the adequacy
and functional effectiveness of the risk management
system and internal control system, among other matters.
Report on the financial reporting-related
risk management and internal control
system pursuant to Section 289 (5) and
Section 315 (2) (5) HGB
The financial reporting-related risk management system
and the connected internal control system are important
elements of the internal management system of Axel
Springer AG. The effective interplay of the risk manage-
ment system and internal control system is meant to
ensure the effectiveness and economic efficiency of the
Group’s business activities, as well as the completeness
and reliability of its financial reporting. The financial-
reporting risk management system and internal control
system comprise all organizational regulations and
measures aimed at the detection and management of
risks related to financial reporting. With a view to the
(consolidated) financial reporting process, the internal
control system is meant to ensure that the Group’s
financial reports convey a true and fair view of the finan-
cial position, liquidity, and financial performance of Axel
Springer AG and the Axel Springer Group, in compliance
with all relevant laws, regulations, and standards. How-
ever, even an effective, and therefore adequate and well-
functioning, internal control system cannot guarantee the
prevention or detection of all irregularities or inaccurate
disclosures.
We consider the following elements of the risk manage-
ment system and internal control system to be significant
with respect to the (consolidated) financial reporting
process:
(cid:1) Processes for identifying, assessing, and documenting
all significant financial reporting-related processes and
risk areas, including the corresponding key controls.
Such processes include financial and accounting pro-
cesses, as well as administrative and operational busi-
ness processes that generate important information
used in the preparation of the separate and consoli-
dated financial statements, including the management
reports of the parent company and the Group.
(cid:1) Process-integrated controls (computer-aided controls
and access restrictions, dual control principle, separa-
tion of functions, analytical controls).
(cid:1) Standardized financial accounting processes, through
the use of an internal, Group-wide Shared Services
Center for most of the consolidated German compa-
nies of the Group.
(cid:1) Group-wide accounting directives in the form of ac-
counting guidelines, charts of accounts, and reporting
procedures.
(cid:1) Quarterly communication of information to all consoli-
dated Group companies on current developments re-
lated to accounting and the process of preparing the
financial statements, as well as the reporting dead-
lines to be observed.
(cid:1) Assuring the requisite expertise of employees involved
in the financial reporting process by means of appro-
priate selection procedures and training.
(cid:1) Centralized preparation of the consolidated financial
statements, employing manual and computer-system
controls in respect of financial reporting-specific con-
nections and dependencies.
(cid:1) Protection of financial reporting-related IT systems
against unauthorized access, by means of access
restrictions.
(cid:1) Monthly internal reports (complete income statement,
statement of financial position, cash flow statement)
and monthly reports on all cost units of the Group,
including analysis and reporting of significant devel-
opments and budget/actual deviations.
72 Annual Report 2011 Axel Springer AG
The effectiveness of the (consolidated) financial report-
ing-related risk management system and internal control
system is systematically reviewed and assessed by
means of periodic control tests; a Group-wide reporting
system ensures that up-to-date information is provided
on a regular basis to the division heads, Management
Board, and Supervisory Board.
Both the risk management system and the internal con-
trol system are continuously enhanced. For example, the
financial reporting-related control system is being inte-
grated with the broader system on a step-by-step basis,
to create a comprehensive system of internal corporate
monitoring. By that means, we synchronize and optimize
our control elements on a cross-divisional basis, thereby
enhance the effectiveness and economic efficiency of the
entire system.
Risk areas
The risks described below could have material effects on
the business activity of Axel Springer and therefore also
on whether and when we achieve our business objectives.
Within the risk categories described below, risks are
presented in the order of their priority for Axel Springer.
Market and competition risks
Markets are increasingly being shaken by the crisis af-
fecting numerous European countries resulting from the
substantial over-indebtedness of individual nations, as
well as by the deteriorating credit ratings of several coun-
tries. Another element of uncertainty relates to the further
development of China as an economic power, which
continues to play a crucial role in the world economy. An
even sharper decline of financial markets would have a
negative impact on economic growth, among other
consequences. Therefore, a significant deterioration of
the revenue performance of our advertising customers
and the resulting decrease in our advertising revenues
that would occur under such a scenario cannot be ruled
out. An adverse development of the general market
environment could lead to lower advertising revenues in
Germany and also reduce our advertising revenues in the
countries of Europe.
The paper price risk is currently deemed to be manage-
able, in particular in consideration of the Group’s diversi-
fied purchasing sources.
Furthermore, the general market situation is still charac-
terized by intense competition pressure. The entry of new
competing titles and formats into the market exposes the
Axel Springer Group to the risk of lost revenues and mar-
ket shares in the circulation and advertising business; this
could intensify if free newspapers and magazines were to
be introduced. Generally speaking, this risk is exacerbat-
ed further by changing consumption and reading habits
(especially as a result of demographic changes).
Another source of uncertainty relates to the growing
competition with traditional print media posed by other
kinds of media. Above all, the growing importance and
use of the Internet results in reductions in the revenues
of print publications.
In that context, the high proportion of total Group-wide
revenues contributed by BILD and the entire family of
BILD brands poses a particular risk. Overall, the paid
circulation of BILD and BILD am SONNTAG has been
declining in the last few years. Furthermore, a significant
proportion of the Group’s high-revenue magazine titles
are supported by the strong recognition and brand famil-
iarity of the BILD family of brands. The possibility that the
success of our BILD titles could be adversely affected by
external factors on a lasting basis, which would conse-
quently have a negative impact on the Group’s financial
position, liquidity, and financial performance, cannot be
ruled out.
In the segment of digital media, the dominant position of
major Internet search engines could pose a market risk.
If, for example, the search engines were to alter their
search algorithms or use their own websites to broaden
their offerings and so compete with our own business
activities or those of our affiliated companies, that could
have a serious impact on the future revenue performance
of certain business activities of Axel Springer.
The above-mentioned general market risks are moni-
tored and minimized primarily by the operational manag-
ers. To counter these risks successfully, Axel Springer
continued in 2011, and will continue in the future, to
pursue the threefold strategy of market leadership in the
German-language core business, internationalization,
and digitization. Therefore, the targeted expansion of
existing activities in Germany is still vitally important to
our company. Furthermore, changing customer needs
Combined Management Report 73
Report on risks and opportunities
can be accommodated by means of product innovations,
accompanied by incentives and other product-related
measures, such as sales-promoting giveaways and
special inserts offered at an extra cost, including DVDs,
CDs, and audio books, for example.
The constant further development and expansion of our
iPhone and iPad apps underscores our determination to
continually increase the degree of digitization of Axel
Springer’s media. By means of acquisitions, new com-
pany start-ups, and the expansion of existing digital
media, we will strive to adapt to changes in the media
world and further promote the cross-media networking
and integration of our brands. (For more information on
that subject, please refer to the report on the business
developments and financial performance of our seg-
ments, beginning on page 53).
Political and legal risks
The effects of new legislative initiatives on various indi-
vidual business models in the digital media segment are
still uncertain at the present time. The enactment of
national laws implementing the Cookie Regulation Di-
rective that has already been enacted on the European
level has not yet been completed in Germany, among
other countries. Although online offerings based on user
accounts are largely unaffected by this new regulation,
it could have a major influence on conventional online
offerings. Cookies are an important tool for recording
data, such as the number of visitors to a website or the
number of clicks on an online advertisement, for example.
Advertisers use the data supplied by cookies to measure
the success of their advertisements and website opera-
tors use it to optimize their offerings and set advertising
rates. Thus, cookies are an important basis for generat-
ing revenues on the Internet. At the present time, con-
crete implementation of this regulation and the ensuing
impact on the revenue performance of Axel Springer and
the company’s strategic orientation remain to be seen.
The three-step test introduced by law in 2009 has prov-
en to be inadequate for effectively limiting the expansion
of state-owned TV stations into the Internet. ARD in
particular has intruded into the business sphere of the
private-sector press and distorted the competition envi-
ronment with a text-oriented news app for Tagesschau
financed by license fees, in a blatant contradiction of the
Interstate Broadcasting Agreement. Faced with competi-
tion from this cleverly designed “free offer,” it is naturally
hard for publishing companies to successfully offer paid
apps. After conducting fruitless negotiations with ARD,
Axel Springer AG and seven other publishing companies,
with the full support of the newspaper publishers’ asso-
ciation BDZV, filed a lawsuit against ARD in the Competi-
tion Division of the Cologne Regional Court. The first oral
proceedings have been held and a second date has
been set for June 2012. Concurrently with the court
proceeding, the publishing companies are conducting
settlement negotiations with ARD. If no agreement can
be reached and if the court does not rule in favor of the
publishing companies, it will be much more difficult for
Axel Springer AG to successfully offer paid journalism
content in the fast-growing mobile market.
Furthermore, our business is still exposed to the compe-
tition-distorting effects of state-owned media and the
regulatory pressure of legislators on all relevant levels of
government.
Breaches of confidentiality agreements and violations of
insider trading regulations, as well as the incorrect publi-
cation of data or the non-observance of data protection
laws and regulations, could lead to economic or legal
consequences for Axel Springer. In such cases, the
possibility of damage to the reputation of the Group or its
brands cannot be ruled out.
To minimize such risks, Axel Springer has adopted vari-
ous control mechanisms and consultation rules, upgrad-
ed its data protection organization further, and initiated
extensive training programs, among other measures. The
company intends to intensify such activities in the future.
IT risks
As a company with a high level of digitization, Axel
Springer is exposed to considerable risks related to the
possible failure of IT systems, data centers, editing sys-
tems, or databases. Particular attention is given to IT
risks that could lead to data losses or, in the worst case,
business interruptions.
Besides those IT risks that affect Axel Springer directly,
there are others that have a considerable impact on the
company’s business activities. In consideration of the
growing importance of paid-content offerings and the
74 Annual Report 2011 Axel Springer AG
related handling of personal data, and the steadily grow-
ing threat of computer criminality, the careful handling
and protection of the above-mentioned customer data
are becoming increasingly important.
By reason of its many online-based business models, Axel
Springer is also dependent on the constant availability of
the websites. The possibility of hacker attacks and the
consequent downtimes entails risks that could potentially
have an adverse effect on the Group’s revenue perfor-
mance and reputation.
Consequently, Axel Springer undertakes targeted
measures to guard against criminal acts and protect its
strategic business model. To avoid or mitigate such risks,
the company employs extensive IT security measures
(such as back-up systems, firewalls, and back-up data
centers), which are continuously upgraded and improved.
Reputation risks
In view of its growing international presence, Axel
Springer has adopted a catalog of social standards
known as the International Social Policy, as a binding
guideline for social integrity, applicable to all our compa-
nies throughout the world. Non-observance of the Inter-
national Social Policy, especially in connection with the
procurement of advertisements and product giveaways,
as well as merchandising or the sale of title licenses,
could potentially cause serious damage to the compa-
ny’s reputation.
The Axel Springer Group has instituted a sustainability
management program that meets international standards.
The overly late detection of possible ecological or social
conflicts relative to the procurement of resources along
the value chain of wood, pulp, paper, and recycled ma-
terials could harm the Group’s reputation. To minimize
this risk as much as possible, we work closely together
with experts in the wood, pulp, and paper industry and
with numerous environmental protection organizations.
We also conduct monitoring measures across the entire
value chain, as well as eco-audits. Axel Springer’s inter-
nal and external communications on this subject are
generally characterized by a high level of openness and
transparency.
Strategic and other risks
Strategic risks arise from the possibility, among others,
that the Group would invest in concepts and companies
that prove not to be sustainably successful, leading to
financial losses. Such investment risks arise primarily
from the possibility of bankruptcy. If the revenue and
profit performance of the companies in which we hold
an investment were to be worse than planned, due to
a renewed worsening of the financial markets and eco-
nomic crisis, it could become necessary to recognize
impairment losses. Generally speaking, however, the
business models of our subsidiaries and associates are
very heterogeneous. Furthermore, we employ internal
assurance measures, including the rigorous examination
of the investment criteria applied in connection with our
M&A activities.
In the digital media business, Axel Springer is additionally
exposed to a heightened risk that a given business mod-
el would prove not to be successful on a sustainable
basis, and that newer Internet business models could
force older ones out of the market. Another significant
factor is the growing popularity of paid-content offers in
the online business, leading not only to higher revenues,
but also increased competition. Therefore, it is entirely
possible that future revenues could be offset by higher
costs to win and retain customers.
To minimize such risks, Axel Springer employs an active
investment management program, takes the necessary
steps to recruit and retain qualified managers, and con-
stantly monitors the relevant business and market devel-
opments. By means of such measures, Axel Springer
minimizes the risk of possible impairment losses in
goodwill and losses on loans to companies in which it
holds an investment.
Furthermore, Axel Springer continues to systematically
pursue its strategy of internationalization and digitization.
The joint venture with Ringier was a decisive step in the
direction of internationalization. From a risk standpoint,
the main risks to which Ringier Axel Springer Media and
its subsidiaries are exposed are market and financial
risks. Declining circulation numbers, which in return
reduce circulation revenues, represent a particular mar-
ket risk and could potentially also reduce advertising
Combined Management Report 75
Report on risks and opportunities
revenues in the medium-term. The advertising market in
eastern Europe in particular is exposed to significant
market risks associated with the growing shift to TV and
digital media. By virtue of the high degree of internation-
alization of Ringier Axel Springer Media AG, the relevant
market risks are distributed over various countries, alt-
hough that fact does entail a heightened foreign exchange
risk (EUR, CHF, eastern European currencies), which the
company counters by means of hedging activities.
With regard to our investment in Do⁄an TV Holding A.S.,
the risk of an impairment loss cannot be ruled out, de-
pending in particular on the further developments and
any adjustments to the business plan that could possibly
be made by the management. In assessing the value of
our investment in this company, due consideration is
given to the existing contractual agreements that protect
the value of our investment.
Furthermore, the loss of major customers could have an
adverse effect on the business success and activities of
the Group. To avoid this risk, we employ a variety of
customer retention measures, among other measures.
Distribution-related risks, including the risk of liquidity
problems on the part of distribution partners, for example,
are countered by means of clearly stipulated payment
terms and firm payment modalities.
The threat of terrorism poses an elementary risk to Axel
Springer. We counter terrorism risks in two ways. First,
we take structural and organizational measures to raise
the Group’s security standards even further; second,
initially in 2009, we took out a new insurance policy to
mitigate the financial consequences of terrorism.
Financial risks and risks associated with the use of
financial instruments
The financial risks especially relevant to the Axel Springer
Group are interest rate risks and currency risks. Interest
rate risks arise primarily from financial assets or liabilities
with variable interest rates. Currency risks arise from
expenses, revenues, investment income and expenses,
and receivables and liabilities denominated in foreign
currencies (transaction risk).
The risk of changing interest rates inherent in variable-
interest assets or liabilities is minimized through the use
of interest rate derivatives.
The risk of value changes arising from exchange rate
fluctuations are avoided primarily in that operating costs
are incurred in the same countries in which we sell our
products and services. Residual currency risks arising
from cash flows denominated in foreign currencies are
immaterial because we generate most of our earnings in
the euro zone. Currency risks inherent in receivables and
liabilities denominated in foreign currencies (excluding
contingent purchase price liabilities) with net exposures
of € 5 million or more per foreign currency are hedged
by means of maturity-matched forward exchange deals.
Local-currency cash flows generated in non-euro zone
countries are either reinvested to expand local business
operations, or invested with Axel Springer AG and
hedged by means of forward exchange deals or distrib-
uted in the form of dividends. Therefore, the liquidity risk
arising from exchange rate changes affecting cash flows
denominated in foreign currencies is limited.
Currency effects arising from the translation of financial
statements denominated in foreign currencies (currency
translation risk) are recognized directly in the equity item
of other comprehensive income. Therefore, Axel Springer
does not hedge such currency effects.
Significant financing risks resulting from the uncertain
outlook for the financial sector are not evident for the
Axel Springer Group at the present time because the
credit line for € 1.5 billion (until 2012) and for € 1 billion
(until 2013) obtained for liquidity assurance purposes has
been committed by the participating banks with binding
effect. The credit facility is contingent upon the ob-
servance of covenants that are based on a certain ratio
of net debt to the earnings indicators of the Axel Springer
Group. Even if the credit facility were to be drawn down
in full, we do not expect to breach any of the agreed
covenants and therefore we consider the risk of acceler-
ation of borrowed amounts to be minor. Based on our
continuous observation of the money markets, capital
markets, and credit markets, we have concluded that
companies with outstanding creditworthiness and strong
76 Annual Report 2011 Axel Springer AG
reputations can always raise funding at favorable condi-
tions. Furthermore, Axel Springer can generate liquidity
reliably, based on its broadly diversified customer base and
the absence of significant payment delays and defaults.
Surplus cash not needed for operations is invested on
the basis of criteria set out in a corporate guideline,
which sets loss limits that may not be exceeded, as a
means (among others) of limiting risks.
The risks arising from financial instruments and hedging
activities are discussed in detail in Section (34) of the
notes to the consolidated financial statements.
Overall risk assessment
Currently, no risk concentrations or interdependencies
that could have a significant influence on the Group’s
financial position, liquidity, and financial performance are
discernible, with the exception of the risk of a drastic
deterioration of the global economy. Therefore, any threat
to Axel Springer’s survival as a going concern or any
decisive effect on the Group’s financial position, financial
performance, and liquidity situation can be ruled out.
Compared to the prior year, moreover, the risk position
of the Axel Springer Group has improved further because
the Group’s financial strength, and consequently its
capacity to absorb risk, has increased in the last twelve
months. Furthermore, the Group is even more broadly
diversified than before.
Opportunities
Market opportunities
If the economy continues to stabilize, as currently pre-
dicted by the leading economic research institutions, that
will have a positive effect on our circulation and advertis-
ing revenues. But even a negative development of the
overall economy could create opportunities for Axel
Springer. For example, competitors could pull out of the
market, thereby strengthening our own market position
on a long-term basis. In such a scenario, moreover, it
may be possible to acquire companies at lower valuations.
Political opportunities
The strengthening of intellectual property rights that
would result from the introduction of a publisher’s ancillary
copyright could have a positive effect on the company’s
business in Germany. Such a law would considerably im-
prove the legal position of publishers in copyright disputes.
Strategic opportunities
By means of the joint venture Ringier Axel Springer Me-
dia, we have taken a decisive step in the direction of
internationalization. Opportunities can arise from the
licensing of titles in the countries in which Axel Springer
AG maintains a presence, from the strategic establish-
ment of strong competitive positions in eastern Europe
and from investments in fast-growing markets, among
others.
In implementing our internationalization strategy, we have
the decisive advantage over our competitors that we
have already attained strong market positions in many
countries, and, indeed, in numerous segments, leading
market positions.
The digitization strategy offers especially promising
opportunities for generating additional revenues via the
dynamic development of revenues in the online advertis-
ing market. Axel Springer is taking advantage of this
market trend through the swift and consistent combina-
tion of print and online offerings, and by investing in
companies, entering into cooperation agreements, and
continually expanding its existing and newly acquired
activities. Opportunities are seen especially in the area
of paid content. Furthermore, the expansion of our
digital offerings in the form of apps for the iPhone and
HD apps for the iPad creates tremendous strategic
opportunities for Axel Springer.
Marketing opportunities
The Group’s marketing unit, Axel Springer Media Impact,
has further consolidated its strong position in the market
and is one of the widest-reach cross-media marketers in
Europe. Thanks to its cross-media business model and its
strong competitive position, Axel Springer is an attractive
advertising platform beyond the realm of TV advertising.
Combined Management Report 77
Forecast report
Forecast report
Anticipated economic environment
General economic environment
In the estimation of the ifo Institute, the global economy
will slow down considerably in 2012, due to the high
levels of government debt in various EU countries and
the United States, as well as tremendous uncertainty in
the capital markets. In the opinion of the ifo Institute,
worsening financing conditions for banks and companies,
accompanied by fiscal policies aimed at consolidating
government finances, will cause consumers and busi-
nesses to postpone their buying and investment deci-
sions. Persistently high domestic demand in the emerg-
ing-market countries will support strong economic
growth in those countries. Overall, the world economy
is expected to expand at a rate of 3.3 % in 2012.
The ifo Institute expects the inflation rate to dip slightly
to 1.8 %, as many companies will find it harder to raise
prices amid weakening economic conditions. Employ-
ment will also increase at a slower rate. The number of
employed persons is expected to average 41.3 million
in 2012, while the number of unemployed persons is
expected to decrease by around 150 thousand to
2.8 million, which would correspond to an average
full-year employment rate of 6.7 %.
In central and eastern Europe, economic growth will
slow considerably in 2012, as the high debt levels of
many countries will force governments to adopt more
restrictive fiscal policies. Therefore, domestic demand
and particularly consumer spending will remain weak
in most countries of the region.
For Germany, the ifo Institute does not expect the eco-
nomic recovery to continue; in fact, it expects the Ger-
man economy to experience a temporary downturn.
Unlike many other European countries, however, the
German economy will probably not fall into recession.
According to the forecast, consumer spending will in-
crease at an inflation-adjusted rate of 1.2 %, thanks to
the healthy state of the jobs market and the high level of
personal incomes. The weak development of production
is expected to reduce capacity utilization rates and thus
limit the growth of plant and equipment investment to an
inflation-adjusted rate of 2.2 %. The wide-ranging fiscal
retrenchment efforts of many euro zone countries can
be expected to weigh on exports, which are likely to
increase only by an inflation-adjusted rate of 2.8 %.
Imports are expected to increase at a somewhat faster
rate of 4.6 %. Furthermore, the low level of interest rates
and investor uncertainty with regard to financial invest-
ments can be expected to stimulate housing demand.
Building investment is expected to increase by 1.6 %.
Overall, the ifo Institute is forecasting economic growth of
0.4 % in 2012.
Anticipated Economic Development (Selection)
Change in gross domestic product
compared to prior year (real)
Germany
Switzerland1)
France
Spain
Hungary
Poland
Czech Republic
Slovakia
Serbia1)
Russia
Source: Ifo Institute, December 2011
1) Source: IMF, September 2011.
2012
0.4 %
1.4 %
– 0.3 %
– 0.6 %
0.2 %
2.6 %
0.9 %
2.0 %
3.0 %
3.5 %
78 Annual Report 2011 Axel Springer AG
Industry environment
The effects of two major sporting events, the Summer
Olympics and the European Soccer Cup, along with
Japan’s recovery from the aftermath of the earthquake,
can be expected to more than offset the negative effects
of the euro debt crisis on the global advertising market.
By contrast, the Central Association of the German
Advertising Industry (ZAW) expects total net advertising
revenues to be 1.5 % lower in 2012 than in 2011.
Besides conventional media, this forecast also covers
direct advertising and online advertising, among other
forms of advertising.
According to the most recent advertising market forecast
by ZenithOptimedia (“Advertising Expenditure Forecast”
of December 2011), the global advertising market is
expected to expand at a rate of 4.7 % in 2012. That
represents a downward correction of ZenithOptimedia’s
earlier forecast from October 2011, which predicted a
5.3 % increase.
To date, the forecasts for Germany suggest a mixed
picture for 2012. ZenithOptimedia expects the total net
advertising market to expand at a nominal rate of 1.9 %.
Thus, the advertising market is expected to grow at a
nominal rate of 2.0 % (or an inflation-adjusted rate of
0.4 %), which is somewhat slower than the forecast
growth rate for the overall economy. This increase will
be carried by television (+ 2.4 %) and online media
(+ 11.8 %). ZenithOptimedia predicts declines in the
net advertising revenues of newspapers (– 2.4 %)
and magazines (– 0.9 %).
According to ZenithOptimedia, the online market will
register strong growth again in 2012, with net advertising
expenditures (including search term marketing and affili-
ate advertising) rising by 11.8 %. This forecast reflects
the long-term structural shift of advertising expenditures
in favor of digital media. According to the forecast data,
Internet and TV will expand their respective shares of
advertising expenditures.
Net advertising revenues are expected to grow in the
media categories of radio (+1.6 %) and billboard
advertising (+ 2.1 %).
For the international markets in which Axel Springer
conducts business activities itself, ZenithOptimedia pre-
dicts an uneven development of net advertising revenues
for newspapers and magazines (as of December 2011).
According to ZenithOptimedia’s forecast, net advertising
volume in the online market in western Europe should rise
by 10.3 % to US$ 22.0 billion in 2012, based on the as-
sumption of constant exchange rates. The growth rates in
eastern European countries will in parts be much higher.
Anticipated Advertising Activity 2012 (Selection)
Change in net ad
revenues compared to
prior year (nominal)
Germany
Switzerland1)
France2)
Spain2)
Hungary
Poland2)
Newspapers Magazines
Online
– 2.5 %
– 0.9 %
11.8 %
2.1 %
– 0.4 %
21.5 %
– 2.3 %
– 4.2 %
7.7 %
– 6.8 %
– 4.0 %
10.0 %
– 2.2 %
– 2.2 %
13.0 %
– 7.3 %
– 5.1 %
15.7 %
Czech Republic2)
– 9.0 %
– 3.8 %
Slovakia1)
Serbia1)
Russia
India2)
8.9 %
3.8 %
– 17.6 %
– 14.0 %
– 5.3 %
– 5.2 %
20.0 %
3.2 %
6.0 %
6.9 %
35.0 %
65.0 %
28.9 %
Source: ZenithOptimedia, Advertising Expenditure Forecast (December) 2011.
1) Gross advertising revenues (excluding classified ad revenues in the print media). The
gross advertising revenues do not adequately reflect the actual development of
advertising revenues.
2) Excluding classified ads.
Combined Management Report 79
Forecast report
Group
Strategic and organizational orientation
Also in 2012, Axel Springer will continue to pursue its
strategy based on the core elements of expanding the
market leadership position in the German-language core
business, internationalization, and especially digitization.
The market leadership position in the German-language
core business will be expanded by continually building
on our strong brands and by developing and establishing
innovative cross-media advertising formats. By this
means, the extraordinarily high reach of our print media
and content portals can be put to optimal use.
We will continue to systematically pursue our internation-
alization strategy. In addition to strong, established print
brands that appeal to a broad base of readers, we will
also focus on the digitization of our activities. Important
criteria for making investments in companies include the
right strategic fit, the professionalism of the management,
and the monetization potential of digital business models.
The digitization strategy is geared to expanding the
Group’s content portals, marketplaces, and marketing
activities. With regard to the content portals, one focus
will be on the continued development of paid content.
In that endeavor, we can make use of the experiences
gathered in connection with the popular formats that have
already been introduced. We have expanded our portfolio
in the business of marketplaces considerably through the
acquisition of SeLoger. In the marketing segment, we
intend to pursue further international growth.
We are not planning to make significant adjustments to
the Group’s organization at the present time.
Anticipated business developments and financial
performance
Under the assumption that general economic conditions
do not experience a significant deterioration, we expect
to generate a single-digit percentage increase in the
Group’s total revenues in financial year 2012. The
anticipated slight decrease in circulation revenues should
be more than offset by the higher total advertising reve-
nues and total other revenues, compared to 2011. We
expect that the slightly lower revenues in the national and
international print business will be more than made up by
higher revenues in the digital media business.
We also expect that the Group’s EBITDA will be slightly
higher than EBITDA for 2011. In that respect, we antici-
pate slightly lower earnings in the print business, and
substantially higher earnings in the digital business,
compared to 2011.
Under the assumption of a positive economic environ-
ment and the absence of adverse factors, we expect to
generate a slight increase in the Group’s revenues and
EBITDA in financial year 2013, to be driven largely by
the further expansion of the digital business.
In the segments, we expect that the total revenues of the
Newspapers National segment in financial year 2012 will
be close to the prior-year figure, with generally stable circu-
lation revenues, slightly lower advertising revenues, and
higher other revenues. We expect that segment EBITDA
will be less than the corresponding prior-year figure.
We expect to generate slightly lower revenues in the
Magazines National segment compared to 2011. While
we deem it possible to match the advertising revenues
generated in the prior year, thanks to the positive effects
of the European Soccer Cup, among other factors, we
anticipate lower circulation revenues and other revenues.
In view of the anticipated drop in revenues, we expect
that segment EBITDA will be less than the corresponding
prior-year figure.
80 Annual Report 2011 Axel Springer AG
We expect to generate lower total revenues in the Print
International segment, based on declines in all revenue
categories. We expect that the positive effects of cost
optimization measures will partly offset the negative
effect of lower revenues, leading to EBITDA that is slightly
below the prior-year figure.
The results of the Digital Media segment in 2012 will be
impacted still by the acquisitions effected in 2011. There-
fore, we expect that the total revenues of this segment
will be considerably higher than the prior-year figure;
even on a purely organic basis, revenues are expected to
grow at a double-digit percentage rate. According to our
expectations, the revenue growth will be driven by gains
in all our business activities in this segment and will have
a positive effect on advertising revenues and other reve-
nues. We also expect to generate a substantially higher
EBITDA in 2012 than in 2011.
As for the Services/Holding segment, we anticipate lower
revenues and a lower EBITDA, due to additionally higher
costs.
Anticipated development of liquidity and financial
position
According to the current planning status, the Group’s
liquidity and financial position will not change significantly
in 2012. Axel Springer has access to extensive short-
term and long-term credit facilities, which can also be
used for acquisitions. Based on the capital expenditure
projects planned to date, investments in property, plant,
and equipment and intangible assets will likely be slightly
less than the corresponding prior-year figure. Financing
will be provided by the operating cash flow.
Dividend policy
Subject to the condition of solid financial performance in
the future, Axel Springer will strive to maintain its divi-
dend policy, which seeks to pay high dividends but also
allows for the financing of growth.
Anticipated workforce development
The average full-year number of employees in 2012 will
be higher than in 2011, mainly due to higher staffing
levels in the Digital Media segment resulting from organic
growth and acquisitions.
Planning assumptions
We plan the future development of the financial perfor-
mance, liquidity, and financial position on the basis of
assumptions that are plausible and sufficient probable from
today’s perspective; in the current economic environment,
however, those assumptions are fraught with great uncer-
tainties. Therefore, the actual development could possibly
be much different from the assumptions applied and the
resulting business plans and trend forecasts.
Disclosures and explanatory report of the Management Board pursuant to takeover law
Combined Management Report 81
Disclosures and explanatory report of the
Management Board pursuant to takeover law
This section contains the disclosures pursuant to Sec-
tions 289 (4), 315 (4) HGB, along with the explanatory
report of the Management Board pursuant to Section
176 (1) (1) AktG.
Composition of subscribed capital
The company’s subscribed capital amounts to
€ 98,940,000. By virtue of a resolution adopted by the
annual shareholders’ meeting of April 14, 2011, the
company’s share capital has been re-apportioned. Each
previous share representing a proportion of share capital
equal to € 3.00 has been replaced with three shares,
each representing a proportion of share capital equal to
€ 1.00 (1:3 share split), so that the company’s share
capital was re-apportioned, effective May 31, 2011 (entry
of the amended Articles of Incorporation in the Commer-
cial Register) and is now divided into 98,940,000 regis-
tered shares (see also page 28). The shares can only be
transferred with the company’s consent (registered
shares of restricted transferability, see below). The
company has only one class of shares.
All shares carry the same rights and obligations. Each
share grants the right to cast one vote in the annual
shareholders’ meeting and represents the basis for de-
termining the shareholder’s entitlement to the company’s
net profit. By way of exception, the treasury shares do
not confer any rights to the company (cf. Section 71b
AktG). (Please refer to page 84 for information on the
company’s treasury shares.)
Restrictions on voting rights or transfer
of shares
By virtue of Article 5 para. 3 of the company’s Articles of
Incorporation, shares of Axel Springer AG and subscrip-
tion rights can be transferred only with the company’s
consent. Such consent must be granted by the Man-
agement Board, although internally, it is the Supervisory
Board that adopts the resolution to grant such consent.
According to the company’s Articles of Incorporation,
such consent can be refused without indication of rea-
sons. However, the company will not arbitrarily refuse its
consent to the transfer of company shares.
The share transfer restriction agreements described
below, which the company has concluded with various
shareholders for the purpose of upholding the restrictions
on the transfer of shares set forth in the Articles of Incor-
poration, even in the case of indirect share transfers, give
rise, or have given rise, to transfer restrictions based on
the German law of obligations (Schuldrecht). In exchange,
the company has, in regular intervals, agreed to pledge
the shares in question to the financing banks.
(cid:1) In connection with the purchase of company shares
from Dr. h. c. Friede Springer by Good Media Invest-
ment Holdings S.A.R.L., the company entered into
a share transfer restriction agreement with Michael
Lewis, Nova Trust Ltd., in its capacity as the trustee
of The Michael Lewis Capital Discretionary Settle-
ments, and other so called ML investors held directly
and indirectly by Nova Trust Ltd., alone, or as a ma-
jority owner (Hague Holdings Ltd., Colmar Investment
Holdings Ltd., and Media Investment Holdings
S.A.R.L.), and the Governor and Company of the
Bank of Scotland, by the date of February 16, 2006.
In this share transfer restriction agreement, the com-
panies participating on the side of Michael Lewis
promised to observe the share transfer restrictions set
forth in the company’s Articles of Incorporation in re-
spect of all indirect and direct purchases, disposals
and encumbrances of the company’s shares. Under
the supplementary agreement of July 31 / September
11, 2006, the company granted its prior consent to
the acquisition of up to 340,000 additional shares
(corresponding to 1,020,000 shares after the share
split conducted in 2011) of the company (or 1 % of
the existing capital stock) by Good Media Investment
Holdings S.A.R.L., and the parties agreed to apply the
obligations under the share transfer restriction agree-
ment of February 16, 2006 to the shares to be pur-
chased in the future as well. In the confirmation
agreement of May 21, 2007, the parties specified that
the above-mentioned agreements will also apply to
any loan increase and to the existing subordinated
pledge right that had again been stipulated for the
shares by way of precaution.
82 Annual Report 2011 Axel Springer AG
(cid:1) In addition, a share transfer restriction agreement was
concluded between Dr. Mathias Döpfner, Brilliant 310.
GmbH, Axel Springer AG, and M.M. Warburg & Co.
KGaA dated July 31 / August 4, 2006. Under this
share transfer restriction agreement, the direct and
indirect purchase of, as well as the direct and indirect
disposal over, the shares of Axel Springer AG by Brilliant
310. GmbH or Dr. Mathias Döpfner are made contin-
gent on the prior consent of Axel Springer AG accord-
ing to the company’s Articles of Incorporation.
Other transfer restrictions based on the German law of
obligations exist in connection with the share ownership
program conducted in 2011 for the employees of the
Axel Springer Group. The shares acquired in connection
with this employee share ownership program are subject
to a minimum holding period that will remain in effect
until May 31, 2013, for employees with individual target
agreements, or until May 31, 2012, for employees enti-
tled to the general profit-sharing bonus, during which
period the shares are safekept for the employees in a
custody account with Deutsche Bank AG.
Furthermore, transfer restrictions based on the German
law of obligations exist in connection with the free share
and share ownership program for the company’s em-
ployees, which was conducted in 2009. The holding
period was one year for the free share program and two
years for the share ownership program.
In connection with the virtual stock option plan 2011 for
senior executives, the beneficiaries are required to per-
sonally invest in shares of Axel Springer AG. These
shares are not subject to any restrictions on disposal,
but any disposition of these shares leads to the lapse
of virtual stock option rights without replacement or
compensation (see page 96 for information on the
virtual stock option plan for senior executives).
The same applies to the virtual stock option plans 2009
and 2012 for members of the Management Board (see
page 93 for information on the virtual stock option plans
2009 and 2012 for Management Board members).
In connection with the placement of the treasury shares
belonging to Axel Springer AG, which occurred in Sep-
tember 2010, Axel Springer used a customary market
protection clause to promise the placing banks that it
would, in principle, not otherwise sell its own shares that
were not an object of this share placement for a period
of six months after the placement was effected, or dis-
pose of them in any other way. This excludes shares that
were issued or transferred under the Company Participa-
tion Program for Management Board members from
2004, or the free share and share ownership program
for employees that was conducted in 2009.
The company is not aware of any restrictions on voting rights.
Shareholdings that represent more than
10 % of the company’s voting rights
At the end of the 2011 financial year, Axel Springer
Gesellschaft für Publizistik GmbH & Co. held around
51.5 % of the company’s capital. This investment is
attributable to AS Publizistik GmbH (in its function as
general partner of Axel Springer Gesellschaft für Publizistik
GmbH & Co.), Friede Springer GmbH & Co. KG, Friede
Springer Verwaltungs GmbH (in its function as general
partner of Friede Springer GmbH & Co. KG), and
Dr. h. c. Friede Springer, herself. In addition, Dr. h. c. Friede
Springer directly held an additional holding equal to about
7.0 % of the company’s capital stock at the end of the
reporting year. Thus, the total shareholding controlled by
Dr. h. c. Friede Springer amounted to around 58.5 %.
Shares endowed with special rights that
confer powers of control
There are no shares endowed with special rights that
would confer powers of control.
Disclosures and explanatory report of the Management Board pursuant to takeover law
Combined Management Report 83
Manner of exercising voting rights when
employees hold shares in the company’s
capital and do not directly exercise their
rights of control
In connection with the free share and share ownership
program for employees conducted in 2009 and the
share ownership program for employees conducted in
2011, Deutsche Bank AG was entered initially in the
stock register with externally owned shares in connection
with the shares transferred to the employees. However,
each employee is free to be registered personally as a
stockholder in the stock register.
Statutory provisions and provisions of
the Articles of Incorporation relative to
the appointment and dismissal of
Management Board members and
amendments to the Articles of
Incorporation
The company’s Articles of Incorporation provide that the
Management Board of Axel Springer AG must be com-
posed of at least two members. The Supervisory Board
decides on the number of Management Board members,
and on the appointment and dismissal of Management
Board members. The term of office is, at the most, five
years and can be re-established for no more than five
years thereafter (cf. Section 84 (1) (1) to (4) AktG). If more
than one person has been appointed to the Manage-
ment Board, the Supervisory Board is authorized to
appoint one of those members as the Chairman (Section
84 (2) AktG). If a required Management Board member
were to be lacking, the court is authorized, in urgent
cases, to appoint the necessary member at the request
of one involved party (Section 85 (1) (1) AktG). The Super-
visory Board is authorized to revoke the appointment of
a Management Board member and the Management
Board Chairman for an important reason (cf. Section 84
(3) (1) and (2) AktG).
Amendments to the company’s Articles of Incorporation
require a resolution of the annual shareholders’ meeting,
carried not only by a simple majority of the votes cast,
but also by at least three quarters of the capital present
and represented at the time of voting on the resolution
(cf. Section 179 (2) (1) AktG in conjunction with Article 21
para. 2 of the company’s Articles of Incorporation). An
amendment of the management principles set forth in
Article 3 of the Articles of Incorporation requires a majority
equal to at least four-fifths of the capital present and rep-
resented at the time of voting on the resolution (cf. Article
21 para. 3 of the company’s Articles of Incorporation).
The Supervisory Board is authorized to resolve amend-
ments to the Articles of Incorporation that only involve
changes to the wording (Article 13 of the Articles of
Incorporation).
Authority of the Management Board to
issue or buy back shares
Axel Springer AG has neither established any authorized
capital that would authorize the Management Board to
issue new shares, nor any conditional capital.
By resolution of the annual shareholders’ meeting of
April 14, 2011 (Agenda Item 7), the Management Board
is authorized, with the consent of the Supervisory Board,
to purchase the company’s own shares up to an amount
equivalent to 10 % of the capital stock existing at the
time the resolution was passed, in the time until April 13,
2016. Such purchases can be effected on the stock
exchange or by means of a public offer to all sharehold-
ers, or a public invitation to submit an offer.
Along with the shares held by the company or attributable
to the company in accordance with Sections 71 a ff. AktG,
the shares purchased by virtue of the foregoing authori-
zation may not at any time exceed 10 % of the compa-
ny’s capital stock. Details concerning this authorization
are provided in the invitation to the annual shareholders’
meeting of April 14, 2011, which is available on the web-
site of Axel Springer AG (see Agenda Item 7 and the
Management Board’s report on this subject).
84 Annual Report 2011 Axel Springer AG
At the end of financial year 2011, the company held
334,380 own shares, which corresponds to about 0.3 %
of the share capital (see page 82 for information on the
market protection clause in connection with the share
placement that occurred in September 2010).
Indemnification agreements of the
company with Management Board
members or employees in the event of a
change of control
Significant agreements of the company
subject to the condition of a change of
control resulting from a takeover offer
With the exception of a credit facility of € 1,500,000,000,
the company has not entered into any significant agree-
ments that would be subject to a change of control
resulting from a takeover offer. The € 1,500,000,000
credit facility extended to the company by a bank syndi-
cate by the date of August 14, 2006 is subject to the
condition of a change of control insofar as the bank
syndicate is entitled, in such a case, to terminate the
credit facility with advance notice of 30 days in the event
of a change of control. Aside from specific exceptions
that relate to the shareholders that currently control Axel
Springer AG, a change of control is understood to mean,
in the context of the credit facility, the acquisition of
shares of Axel Springer AG representing more than 50 %
of the capital stock and/or voting rights by one or more
parties acting together.
Some Management Board members have the right to
terminate their service contracts in the event of a change
in control. A change in control within the meaning of
these contracts would exist if the majority shareholder
Dr. h. c. Friede Springer should cease to hold or control
the majority of shares, indirectly or directly. In such a
case, the affected Management Board members have
the right to receive payment of their base salary for the
most recently negotiated remaining contractual term, not
to be less than payment of one year’s base salary. Fur-
thermore, the company will pay the prorated percentage
of the success-based compensation for the period of
time served in the year of resignation. The service con-
tracts of the members of the Management Board do not
provide for any other compensation if the service rela-
tionship is terminated as a result of a change in control.
There are no such indemnification agreements with
employees of the company.
Combined Management Report 85
Corporate Governance Report
Corporate Governance Report
The present section contains a report by the Manage-
ment Board – also on behalf of the Supervisory Board –
on corporate governance at Axel Springer, in conformity
with the recommendation set forth in Section 3.10 of the
German Corporate Governance Code. This section also
contains the management declaration pursuant to Sec-
tion 289a of the German Commercial Code (HGB) and
the Compensation Report.
Good corporate governance as a guiding
principle
At Axel Springer, sound corporate governance is consid-
ered to be a crucial element of responsible management
and supervision geared to increasing the company’s
value on a long-term basis. It promotes the trust and
confidence of our national and international investors,
customers, employees, and the public in the manage-
ment and supervision of the company and is therefore
an essential basis for the company’s lasting success.
In this respect, we are guided by the German Corporate
Governance Code (DCGK). We have taken appropriate
measures to implement and ensure compliance with the
recommendations of DCGK. The Corporate Governance
Officer is the Management Board member in charge of
Personnel, Finance, and Services. The implementation of
and adherence to the recommendations of DCGK are
reviewed continually.
Management declaration pursuant to
Section 289a HGB
Declaration of Conformity pursuant to Section 161
AktG
The Management Board and Supervisory Board pub-
lished the following Declaration of Conformity on No-
vember 7, 2011:
“Pursuant to Section 161 of the German Stock Corpora-
tions Act (AktG), the Management Board and Supervisory
Board of Axel Spring AG declare the following:
I. Prospective section
The company follows the recommendations of the German
Corporate Governance Code (DCGK) in the version of
May 26, 2010, as published by the German Federal
Ministry of Justice in the official announcements section
of the electronic Federal Gazette of July 2, 2010, with the
exception of the difference noted and justified below:
Itemized disclosure of Supervisory Board compen-
sation (No. 5.4.6 (6) and (7) DCGK)
The compensation granted to the members of the Su-
pervisory Board and the payments made to the mem-
bers of the Supervisory Board for services provided
personally are not individually itemized in the Corporate
Governance Report (Section 5.4.6 Paras. 6 and 7 DCGK).
The information is not individually itemized because the
competitors of Axel Springer AG do not publish any such
information either.
II. Retrospective section
Since the company’s last Declaration of Conformity on
November 8, 2010 (updated on March 1, 2011), the
company has followed the recommendations of DCGK in
the version of May 26, 2010, as published by the German
Federal Ministry of Justice in the official announcements
section of the electronic Federal Gazette of July 2, 2010,
with the exception of the difference noted and justified
above in Section I. And with the exception of the differ-
ence noted and justified below, as already explained in
the updated version published on March 1, 2011, of the
Declaration of Conformity November 8, 2010:
Severance pay cap in the event of premature ter-
mination without cause of a Management Board
employment contract or in connection with a
change of control (No. 4.2.3 (11), (12), and (13) DCGK)
In connection with the renewal of the employment con-
tract of a long-serving Management Board member, no
so-called severance pay cap was stipulated in the event
of premature termination without cause of the Manage-
ment Board employment contract (No. 4.2.3 (11) and (12)
DCGK) and for payments promised in connection with
the premature termination of the Management Board
employment contract subsequent to a change of control
(No. 4.2.3 (13) DCGK).
86 Annual Report 2011 Axel Springer AG
The Supervisory Board opted not to stipulate such a
severance pay cap because the Management Board
employment contract that is currently in effect with the
affected Management Board member, which was con-
cluded prior to the introduction of the corresponding
recommendations of DCGK in the version of June 6,
2008, does not stipulate such a severance pay cap
either. Therefore, the agreement in effect between the
company and the Management Board member was
merely upheld. The Supervisory Board deems it appro-
priate to refrain from stipulating a severance pay cap in
the interest of retaining the Management Board member
in question.
Berlin, November 7, 2011
Axel Springer AG
The Supervisory Board
The Management Board”
The foregoing Declaration of Conformity of November 7,
2011 and the older versions are available via the link
www.axelspringer.com/declarationofconformity.
Important management practices
Axel Springer is the only German media company that
has provided itself with a corporate constitution. This is
anchored in Article 3 (“Principles of Corporate Governance”)
of the company’s Articles of Incorporation and is thus a
guiding principle for all employees. The corporate consti-
tution can be examined and downloaded at
www.axelspringer.com/corporateprinciples.
A guideline for managers concretizes the requirements
imposed on the management of the Axel Springer Group
that are based on the corporate constitution.
Moreover, Axel Springer has established guidelines for
journalistic independence. These guidelines concretize
and broaden the scope of the journalistic principles set
forth in the Code of Conduct of the German Press
Council (Grundsätze des Pressekodex des Deutschen
Presserats). They delineate the boundaries between
advertising and editorial copy, and between the editors’
and reporters’ private and business interests. They also
preclude actions in pursuit of personal advantages and
define the company’s position with respect to the treat-
ment of news sources. The guidelines thus represent the
framework for independent and critical journalism in the
editorial departments of all media belonging to the Group.
The editors-in-chief are responsible for observing and
implementing the guidelines in the company’s day-to-
day activities.
In addition, Axel Springer has developed a catalog of
social standards. This International Social Policy explains
the company’s position on matters of human rights,
adherence to the rule of law, the protection of children
and young people, the treatment of employees, health,
safety, and the compatibility of work and family, among
other things. The International Social Policy is available
for download at www.axelspringer.com/socialpolicy_en.
Furthermore, the company has issued an environmental
guideline, comprising four points, which serves as a
practical guide to the many environmental protection
measures conducted at Axel Springer. The complete
guidelines can be found at www.axelspringer.com/guidelines.
Additionally in financial year 2010, Axel Springer estab-
lished a separate department for Governance, Risk &
Compliance. This department is responsible for topics
such as risk management, the internal control system,
and compliance management. As described in the Risk
Report (see page 70), risk management and the internal
control system seek to identify risks throughout the
company and to systematically monitor the measures
implemented to minimize risks. At Axel Springer, compli-
ance means the fulfillment of all laws, regulations, and
guidelines, as well as the commitments undertaken
voluntarily. Based on the foregoing, the goal of compli-
ance management is to institute structures and process-
es to ensure that all directors and employees, and espe-
cially senior executives, conduct themselves in accord-
ance with applicable laws and regulations. Another goal
of compliance management is to prevent harm to the
company’s reputation and financial condition that could
result from violations of laws and regulations.
As another step to strengthen sound corporate governance
and establish an appropriate compliance management
program, Axel Springer published a Code of Conduct in
Combined Management Report 87
Corporate Governance Report
financial year 2011. The Code of Conduct summarizes
the existing corporate principles and values, along with
appropriate guidelines, and specifies the ethical, moral,
and legal requirements to be observed by all employees.
The Code of Conduct can be found at
www.axelspringer.de/coc.
Procedures of the Management Board and Super-
visory Board and the composition and procedures
of the committees of the Supervisory Board
Cooperation between the Management Board and Su-
pervisory Board
In accordance with the legal requirements, management
and supervision at Axel Springer are conducted on the
basis of a dual management system. The Management
Board manages the company under its own responsibil-
ity. The Supervisory Board appoints the members of the
Management Board, and monitors and advises the latter
in the conduct of the business. The two boards work
closely together in an atmosphere of trust and confi-
dence to sustainably enhance the company’s value. The
two boards are strictly separated in terms of personnel
and their areas of authority.
Procedures of the Management Board
In its executive function, the Management Board is obli-
gated to pursue the interests of the company and dedi-
cated to sustainable company development. It develops
the strategic orientation of the company and is responsi-
ble for its implementation in coordination with the Super-
visory Board. The Management Board manages the
company’s affairs in compliance with the relevant laws,
the Articles of Incorporation, and its rules of procedure.
It provides regular, timely, and comprehensive infor-
mation to the Supervisory Board on all relevant matters
of strategy, planning, business development, risk man-
agement including the risk situation, and the internal
control system and compliance management system. In
accordance with the rules of procedure adopted by the
Supervisory Board, important decisions of the Manage-
ment Board require the approval of the Supervisory
Board. Such decisions include, above all, the creation or
discontinuation of business divisions, the acquisition or
sale of significant equity investments, and the adoption
of the company’s annual business and financial plan.
The members of the Management Board are jointly re-
sponsible for the management, work together collegially,
and keep each other informed of important measures
and business transactions in their business divisions.
Notwithstanding the general responsibility of all Man-
agement Board members, each member of the Man-
agement Board manages the business division assigned
to him, under his own responsibility, with the exception
of those decisions that are incumbent on the full Man-
agement Board.
The Management Board meets regularly in the form of
Management Board meetings, which are convened and
chaired by the Management Board Chairman, as a gen-
eral rule. Furthermore, every Management Board mem-
ber and the Chairman of the Supervisory Board is enti-
tled to convene a meeting. As a general rule, the full
Management Board adopts resolutions by a simple
majority of the votes cast; in case of a tie, the Manage-
ment Board Chairman casts the deciding vote, to the
extent legally permissible. No resolution adopted in spite
of being opposed by the Management Board Chairman
shall be carried out until the Supervisory Board decides
the issue, also subject to the limits of the applicable laws.
The rules of procedure adopted by the Supervisory
Board for the Management Board provide more precise
rules, including the following:
(cid:1) The obligation to observe and comply with the corpo-
rate constitution and to anchor it throughout the Group
(cid:1) The executive organization chart and the decisions to
be made by the full Management Board
(cid:1) The duties of the Chairman of the Management Board
(cid:1) Transactions that require the approval of the Supervisory
Board
(cid:1) Rules concerning the regular, timely, and comprehen-
sive provision of information to the Supervisory Board,
(cid:1) Rules concerning meetings and the adoption of
resolutions
(cid:1) The obligation to disclose conflicts of interest.
88 Annual Report 2011 Axel Springer AG
Following the retirement, effective at the end of 2011, of
Mr. Rudolf Knepper, who had been the Management
Board member in charge of Printing, Logistics, and Per-
sonnel and the Vice Chairman for many years, and the
appointment of Jan Bayer and Ralph Büchi to the Man-
agement Board, both with effect from January 1, 2012, the
Management Board is now composed of five members:
(cid:1) Dr. Mathias Döpfner, Management Board Chairman
(cid:1) Jan Bayer, Management Board member in charge of
WELT Group and Printing
of the Group. It regularly assesses the efficiency of its
work by means of a questionnaire. Please refer to the
report of the Supervisory Board (page 97) for additional
information on the activities of the Supervisory Board in
financial year 2011.
The rules of procedure of the Supervisory Board comply
with the requirements of the German Corporate Governance
Code and contain rules covering the following, among
other things:
(cid:1) The election and duties of the Chairman and Vice
Chairman of the Supervisory Board
(cid:1) Ralph Büchi, Management Board member in charge
of International Business
(cid:1) Calling of meetings
(cid:1) Lothar Lanz, Management Board member in charge
of Personnel, Finance and Services
(cid:1) Dr. Andreas Wiele, Management Board member in
(cid:1) The adoption of resolutions at meetings or by way of
written correspondence, telephone calls, telexes, or
other means of telecommunications
charge of BILD Group and Magazines
(cid:1) The obligation to disclose conflicts of interest.
Procedures of the Supervisory Board
The Supervisory Board is composed of nine members,
who are elected by the annual shareholders’ meeting.
The term of office of Supervisory Board members is five
years; they are eligible for re-election at the end of their
terms. The Supervisory Board elects its Chairman from
among its own ranks; the term of office of the Superviso-
ry Board Chairman is coincident with that of the Supervi-
sory Board. The Supervisory Board advises the Man-
agement Board and monitors the work of the Manage-
ment Board. It holds at least four meetings a year. In
case of necessity, it meets without the Management
Board in attendance. Meetings may be held and resolu-
tions adopted also by way of written correspondence,
telephone calls, telexes, or other forms of telecommuni-
cation. As a general rule, the Supervisory Board adopts
resolutions by a simple majority of the members voting
on the resolution; in case of a tie, the Management
Board Chairman casts the deciding vote. The Superviso-
ry Board deliberates on the company’s business devel-
opments, planning, strategy, and significant capital ex-
penditures at regular intervals. The Supervisory Board
adopts the separate financial statements of Axel Springer
AG and approves the consolidated financial statements
The members of the Supervisory Board are:
(cid:1) Dr. Giuseppe Vita (Chairman)
(cid:1) Dr. h. c. Friede Springer (Vice Chairwoman)
(cid:1) Dr. Gerhard Cromme
(cid:1) Oliver Heine
(cid:1) Klaus Krone
(cid:1) Dr. Nicola Leibinger-Kammüller
(cid:1) Prof. Dr. Wolf Lepenies
(cid:1) Michael Lewis
(cid:1) Dr. Michael Otto
Combined Management Report 89
Corporate Governance Report
The Chairman of the Supervisory Board, Dr. Giuseppe
Vita, who is simultaneously the Chairman of the Audit
Committee, amongst other things satisfies the require-
ments of expert knowledge and independence within the
meaning of Section 100 (5) AktG (financial expert).
The terms of office of the current members of the Super-
visory Board will expire upon the conclusion of the annu-
al shareholders’ meeting in 2014.
Composition and procedures of committees
The Management Board has not formed committees.
In accordance with its rules of procedure, the Supervisory
Board has formed four committees to support the work
of the full board: the Executive Committee, the Personnel
Committee, the Nominating Committee, and the Audit
Committee. In those matters stipulated in the rules of
procedure of the Supervisory Board, the committees
prepare the resolutions to be adopted and other matters
to be addressed by the full board. Within the limits of
applicable laws, the committees also adopt resolutions
in lieu of the full board in those matters stipulated in the
rules of procedure of the Supervisory Board. The rules of
procedure of the Supervisory Board stipulate the proce-
dures for meetings and resolutions adopted by the
committees and define their areas of responsibility. In
connection with the actions for nullification of resolutions
adopted by the annual shareholders’ meetings in 2008
to 2010, which have been pursued by the shareholder
Dr. Oliver Krauß, the Supervisory Board formed a com-
mittee that was charged with adopting a resolution on
a possible settlement with Dr. Oliver Krauß. Due to the
failure of the settlement negotiations, however, the
committee did not meet or adopt resolutions in 2011.
Please refer to the Report of the Supervisory Board
(page 97 ff.) for information on the areas of responsibility
and composition of the committees.
The Chairman of the Audit Committee, Dr. Giuseppe Vita,
satisfies the requirements for expert knowledge and
independence within the meaning of Section 107 (4) in
conjunction with Section 100 (5) AktG (financial expert),
as well as the requirements set forth in the recommenda-
tion in No. 5.3.2 (2) DCGK.
Further information on corporate
governance
Goals for the composition of the Supervisory Board
In its meeting of October 14, 2010, the Supervisory
Board resolved and confirmed the following goals for its
composition, in view of Section 5.4.1 DCGK:
(cid:1) The Supervisory Board of Axel Springer AG should be
composed in such a way that its members generally
possess all knowledge, abilities, and professional ex-
perience necessary to perform the duties of the Su-
pervisory Board.
(cid:1) With due consideration given to the company’s busi-
ness object and purpose, the size of the company,
and the relative importance of its international activi-
ties, the Supervisory Board will strive, as a goal for the
upcoming regular elections, to bring about a compo-
sition of its members that is appropriate in view of the
following considerations, in particular:
(cid:1) At least two seats on the Supervisory Board should
be held by persons who fulfill the criterion of interna-
tionality to a particular degree (for example, by rea-
son of relevant experience in international business).
(cid:1) Supervisory Board members should not hold any
position on a board or perform any consulting work
for important competitors of the company.
(cid:1) The Supervisory Board should have an adequate
proportion of women. Currently, two of the nine
members (22.2 %) are women; the Supervisory
Board considers this adequate in any event.
(cid:1) In making nominations, due consideration should be
given to the general rule that Supervisory Board mem-
bers should not be older than 72 years; the Supervisory
Board can approve exceptions to this policy. Further-
more, the Supervisory Board should observe the prin-
ciple that as few members as possible should be sub-
ject to a potential conflict of interest, as in connection
with an advisory role or board seat with significant
customers, suppliers, creditors, or other significant
business partners of Axel Springer. Furthermore, the
Supervisory Board should give due consideration to
the principle that its composition should meet the cri-
terion of diversity.
90 Annual Report 2011 Axel Springer AG
The foregoing principles have already been completely
implemented with the current composition of the Super-
visory Board of Axel Springer AG.
Goals for the composition of Management Board
Also in its meeting of October 14, 2010, the Supervisory
Board adopted the following goals for the composition of
the Management Board, in view of Section 5.1.2 DCGK:
(cid:1) In making decisions concerning the composition
of the Management Board, the Supervisory Board
should give due consideration to the principle of
diversity and should strive in particular to give appro-
priate consideration to women.
(cid:1) The Supervisory Board should work together with the
Management Board to assure long-term succession
planning.
(cid:1) At the time of being (re-)appointed to the Manage-
ment Board, no member should be older than 62,
as a general rule; the Supervisory Board can approve
exceptions to this rule.
In appointing the two new Management Board members
Messrs. Jan Bayer and Ralph Büchi effective January 1,
2012, the Supervisory Board gave due consideration to
the principles mentioned above and appointed the best-
suited candidates, in its opinion.
Goals of the company concerning the appointment
of key positions
In view of the recommendation set forth in Section 4.1.5
DCGK, reference is made to the description of personnel
policies designed to assure equal opportunity and diver-
sity on page 31 of this Annual Report.
Shareholders and annual shareholders’ meeting
The annual shareholders’ meeting of Axel Springer AG is
the central governing authority in which the shareholders
exercise their rights and cast their votes. Every share
confers the right to cast one vote in the annual share-
holders’ meeting. Those shareholders who are registered
in the share register and have registered for the meeting
in time are entitled to vote. The Chairman of the Supervi-
sory Board generally chairs the shareholders’ meeting.
To make it easier for shareholders to exercise their pre-
rogatives at the annual shareholders’ meeting, their votes
can be cast by authorized proxies. Axel Springer AG also
designates a voting proxy whom shareholders can elect
to execute their voting rights according to their instruc-
tions. All required reports and documents are made
available to the shareholders in advance, also on the
company’s Internet page.
The annual shareholders’ meeting resolves specifically
on the utilization of the distributable profit, the ratification
of the actions of the Management Board and Superviso-
ry Board, the election of the Supervisory Board, the
election of the independent auditor, and other matters
legally assigned to them, such as corporate actions and
other amendments to the Articles of Incorporation. The
resolutions of the annual shareholders’ meeting require a
simple majority of the votes cast, unless another majority
is prescribed by law or by the company’s Articles of
Incorporation. The Articles of Incorporation can be
inspected on the company’s website at
www.axelspringer.de/articlesofassociation.
Conflicts of interest
The members of the Management Board and Supervisory
Board are bound to promote the interests of the company.
No member of either board may, through their decisions,
pursue personal interests or take advantage of business
opportunities that should be the province of the company.
Management Board members may not demand or
accept gifts or other benefits from, or grant unjustified
benefits to, third parties in connection with their activities,
either for their own benefit or for that of others. Sideline
activities of the Management Board require the consent
of the Supervisory Board. Management Board members
are subject to a comprehensive anti-competition clause
during the period of their activity for Axel Springer. Every
Management Board member must inform the Supervisory
Board of any conflict of interest without delay. No Man-
agement Board member had a conflict of interest in 2011.
Likewise, each member of the Supervisory Board must
disclose such conflicts to the Supervisory Board imme-
diately; the Supervisory Board reports to the annual
shareholders’ meeting on any conflicts of interest and
Combined Management Report 91
Corporate Governance Report
how they are handled (see the Report of the Supervisory
Board, page 99, for information on conflicts of interest
that arose in 2011).
Memberships on other supervisory bodies
A summary of the seats held by the Management Board
and Supervisory Board members of Axel Springer AG on
other legally prescribed supervisory boards or compara-
ble boards in Germany and abroad can be found on
page 172.
Transparency
Axel Springer is committed to always providing compre-
hensive, timely – and simultaneously – and consistent
information on the significant events and developments
relevant to an evaluation of the company’s present and
future business performance to all capital market partici-
pants. Reporting on the business situation and Group
results is presented in its annual report, at its annual
financial statements press conference, and in its quarter-
ly reports. For this purpose, the company also uses
Internet communication channels whenever possible.
Axel Springer also regularly participates in conferences
and roadshows in key international financial centers;
additional information on this subject can be found on
page 27 of this Annual Report. To the extent required by
law, the company also provides information in the form
of ad-hoc announcements and press releases, and on
the company’s website.
In order to ensure equal treatment of all capital market
participants, Axel Springer also publishes information
relevant to the capital markets simultaneously in the
German and English languages on the company’s Inter-
net page. Financial reporting dates are published in the
financial calendar with sufficient advance notice. Immedi-
ately upon receiving the corresponding notices, the
company publishes changes in the composition of the
shareholder structure that are subject to the reporting
obligation according to Section 26 of the German Securi-
ties Trading Act (Wertpapierhandelsgesetz, WpHG), and
on the purchase and sale of shares by persons who
exercise management duties at Axel Springer (directors’
dealings), in accordance with Section 15 a WpHG.
Shareholdings
The Management Board members in office at the report-
ing date directly or indirectly held 1,436,956 shares of Axel
Springer AG at the reporting date of December 31, 2011.
Of that number, 1,246,692 shares were held directly by
the Chairman of the Management Board, Dr. Mathias
Döpfner, and indirectly via Brilliant 310. GmbH.
At the reporting date, the Supervisory Board members
directly or indirectly held a total of 61,023,894 shares of
Axel Springer AG. Dr. h. c. Friede Springer held
51,000,030 shares indirectly via Friede Springer GmbH &
Co. KG and Axel Springer Gesellschaft für Publizistik
GmbH & Co, and 6,926,940 shares directly. Michael
Lewis indirectly held an additional 3,063,924 shares
through Good Media Investment Holdings S.à.r.l.
Preparation and auditing of the financial
statements
The consolidated financial statements and interim finan-
cial statements are prepared in accordance with Interna-
tional Financial Reporting Standards (IFRS), as they are
to be applied in the European Union. The consolidated
financial statements also contain the disclosures pre-
scribed by Section 315a (1) HGB.
The consolidated financial statements are prepared by
the Management Board of Axel Springer AG and audited
by the independent auditor. Axel Springer publishes the
consolidated financial statements within 90 days and the
quarterly reports within 45 days of the respective period
ending dates.
The notes to the consolidated financial statements also
contain information on the company’s relationships with
shareholders who are to be classified as related parties
according to the definitions of the applicable accounting
regulations.
In accordance with the German Corporate Governance
Code, it is agreed with the independent auditor in each
financial year that the latter will inform the Chairman of
the Supervisory Board or the Audit Committee without
delay of any circumstances arising during the course of
the audit that would constitute grounds for disqualifica-
tion or partiality. It is also agreed that the independent
92 Annual Report 2011 Axel Springer AG
will immediately report any material issues, matters, and
events arising during the course of the audit that fall
within the purview of the Supervisory Board. It is further
agreed that the independent auditor will inform the Su-
pervisory Board or make an observation in the audit
report if the independent auditor were to discover, during
the course of the audit, any facts that contradict the
Declaration of Conformity by the Management Board
and Supervisory Board according to Section 161 AktG.
Ongoing actions for nullification
In the years 2005 to 2007, the shareholder Dr. Oliver
Krauß contested various resolutions adopted by the
respective annual shareholders’ meetings of the compa-
ny. All of the suits were unsuccessful with the exception
of the action to nullify the resolutions ratifying the actions
of the Management Board at the regular annual share-
holders’ meeting of 2006, which were then repeated by
the regular annual shareholders’ meeting of 2010. There
follows a report on the currently ongoing proceedings.
On May 20, 2008, Dr. Oliver Krauß filed an action to
nullify the resolutions of the annual shareholders’ meeting
of April 24, 2008 relating to Agenda Item 2 (Utilization of
the retained earnings), Agenda Item 3 (Ratification of the
actions of the Management Board), and Agenda Item 4
(Ratification of the actions of the Supervisory Board), as
well as Agenda Item 7 (Special authorization to purchase
and use the company’s own shares according to Section
71 (1) (8) AktG in connection with the Management Par-
ticipation Program). On May 26, 2008, moreover, the
shareholder Klaus Zapf filed an action to nullify, or failing
that, to annul the resolution of the annual shareholders’
meeting of April 24, 2008 relating to the Agenda Item 3
(Ratification of the actions of the Management Board).
The Berlin Regional Court combined the two actions into
one (Case No. 98 O 49/08). The shareholders Oliver
Wiederhold, Gastro Beteiligungs AG, and SCI AG joined
the action on the side of the defendant. On March 17,
2009, the Berlin Regional Court rejected both suits in
their entirety. The plaintiff Dr. Oliver Krauß filed an appeal
of this ruling with the Berlin Appellate Court (Case No. 23
U 63/09), which for its part was denied in its entirety by a
ruling dated May 3, 2010. Thereupon, the plaintiff filed an
appeal against the judgment of the Berlin Appellate
Court and an appeal against denial of leave to appeal
with the Federal Supreme Court, where the proceeding
is pending under Case No. II ZR 122/10.
On May 21, 2009, Dr. Oliver Krauß filed an action to
nullify the resolution of the annual shareholders’ meeting
of April 23, 2009 relating to Agenda Item 7 (Special au-
thorization to purchase and use the company’s own
shares according to Section 71 (1) (8) AktG in connection
with the Management Participation Program) and con-
tested the election of Dr. h. c. Friede Springer and Brian
Powers to the Supervisory Board of the company (Agen-
da Item 8). Moreover, Dr. Oliver Krauß petitioned for a
finding that the company is obligated to provide him, in
his capacity as a shareholder, a transcript of those por-
tions of the “stenographic minutes from its question
recording and question answering system” that cover his
questions and comments, as well as the information
provided by the company in response. The shareholders
SCI AG and Oliver Wiederhold joined the action on the
side of the defendant. The Berlin Regional Court rejected
the suit in its entirety by judgment dated June 10, 2010
(Case No. 95 O 52/09), that is, both with regard to the
action to nullify, as well as the petition for a finding. Dr.
Oliver Krauß filed an appeal against this decision before
the Berlin Appellate Court; the appeal proceeding is
being conducted under Case No. 23 U 125/10.
On May 21, 2010, Dr. Oliver Krauß filed an additional
action to nullify the resolutions of the annual sharehold-
ers’ meeting of April 23, 2010 relating to ratification of
the actions of the Management Board and the Supervi-
sory Board for financial year 2009 (Agenda Items 3 and
4), as well as the general authorization to purchase and
use the company’s own shares according to Section 71
(1) (8) AktG and to exclude the preemptive right, and the
special authorization, to purchase and use the compa-
ny’s own shares according to Section 71 (1) (8) AktG in
connection with the Management Participation Program
and to exclude the right to tender and preemptive right
(Agenda Items 6 and 7). This action is pending before
the Berlin Regional Court under Case No. 105 O 53/10.
The shareholder Frank Scheunert and Gastro Beteiligungs
AG joined this action on the side of the defendant. After
an oral proceeding that was held on April 6, 2011, the
date of March 7, 2012, has been set for another oral
proceeding.
Combined Management Report 93
Corporate Governance Report
Compensation Report
Axel Springer’s compensation policy follows the principle
of granting compensation to the Management Board and
Supervisory Board that is based on their performance in
the interest of sustainable corporate development. This
compensation consists of fixed and variable performance-
dependent components.
Management Board
In accordance with the requirements of the German
Stock Corporation Act and the recommendations of
DCGK, the compensation of the Management Board
members consists of fixed and variable components.
The variable compensation is composed of a cash com-
ponent paid in the form of an annual bonus and a long-
term, stock-based component. All components of com-
pensation are appropriate, both individually and as a
whole. The criteria used to determine appropriateness are
the tasks of the individual Management Board member,
his personal performance, as well as the economic situa-
tion, profit, and the future prospects of Axel Springer.
Due consideration is also given to the industry environ-
ment. No external compensation experts were consulted
in 2011.
The fixed compensation corresponds to the annual
fixed salary; in addition, the Management Board mem-
bers receive a company car or company car allowance
and security expenses as fringe benefits. The annual
fixed salary is established for the entire term of an em-
ployment agreement and is disbursed in 12 monthly
installments. It is set on the basis of the duties of the
individual Management Board member, the current
economic situation, the profit, and the future prospects
of the Group, among other considerations.
The variable compensation in the form of a cash
component paid in the form of an annual bonus is limited
in its maximum amount and is set according to the per-
formance of the individual in the context of individual
goals (including quantitative divisional goals and qualita-
tive individual goals aligned with the strategy of Axel
Springer AG) as well as corporate goals. For financial
year 2011, the corporate goals were Group EBITDA, the
index of Group customer satisfaction, and EBITDA in the
Digital Media segment; for financial year 2012, the de-
termining corporate goals will be Group EBITDA and the
EBITDA of the Digital Media segment. The Supervisory
Board adopts both the goals applied for measuring
individual performance and the corporate goals. Goal
achievement is determined initially by the Supervisory
Board Chairman, in consultation with the respective
Management Board member, and is then resolved by
the Supervisory Board. In the case of Management
Board members whose employment contracts were
either amended or concluded anew, or extended in the
time since the Act on the Appropriate Compensation of
Management Board Members (VorstAG) became effec-
tive on August 5, 2009, a portion of the variable cash
compensation is determined on the basis of fulfillment of
the corporate goals adopted for an appraisal period of
three years.
In addition, Management Board members receive a
long-term variable compensation component in the
form of virtual stock option plans that were introduced in
2009 (referred to hereinafter as the Virtual Stock Option
Plan 2009) and as of January 1, 2012 (referred to here-
inafter as the Virtual Stock Option Plan 2012).
Under the Virtual Stock Option Plan 2009, a total of
1,125,000 (before the share split: 375,000) virtual stock
options were issued, effective July 1, 2009; under the
Virtual Stock Option Plan 2012, a total of 450,000 virtual
stock options were issued, effective January 1, 2012. In
both cases, the virtual stock options have a term of six
years and can be exercised at the earliest after four years.
If the Management Board employment contract or ap-
pointment to the Management Board remains in effect at
least until the expiration of the four-year vesting period,
all virtual stock options granted to the Management
Board member can become vested. If the respective
Management Board member resigns prior to this time, a
pro-rated number of the virtual stock options granted to
him will become vested, in proportion to the four-year
waiting period, unless the termination occurs on or be-
fore the first calendar day of the year in which the re-
spective virtual stock options were issued. In that case,
the affected virtual stock options will be forfeited without
replacement or compensation. Another precondition for
94 Annual Report 2011 Axel Springer AG
vesting is the achievement of a performance or outper-
formance target related to the share price of the Axel
Springer share. The stock options can only be exercised
if the average price of the Axel Springer share during a
period of 90 calendar days prior to exercise is at least 30 %
higher than the baseline values (Virtual Stock Option Plan
2009: € 20.29 (before the share split: € 60.86); Virtual
Stock Option Plan 2012: € 30.53) and if the percentage
increase in the price of the Axel Springer share is greater
than the appreciation of the DAX stock index over the
same period. Each stock option grants the right to pay-
ment of an amount equal to the appreciation of the Axel
Springer share, but not to exceed 200 % of the baseline
value (Virtual Stock Option Plan 2009: € 40.57 (before
the share split: € 121.72); Virtual Stock Option Plan
2012: € 61.06); this amount is the difference between
the volume-weighted average share price during the last
90 calendar days prior to exercising the stock options
and the baseline value. Management Board members
are obligated to hold one share of Axel Springer AG for
every ten stock options as a personal investment. If they
were to dispose of these shares prior to exercising the
options, the stock options will be forfeited at the rate of
one share for each ten stock options. The value of the
virtual stock options at the grant date in 2009 was
€ 4.7 million. The value of the virtual stock options at the
grant date in 2012 was € 2.4 million. For additional in-
formation on the Virtual Stock Plans 2009 and 2012,
please refer also to the disclosures in the notes to the
consolidated financial statements, in Section (12).
Some Management Board members have the right to
terminate their service contracts due to a change in
control. They then have the right to receive payment of
their base salary for the most recently negotiated remain-
ing contractual term, not to be less than one year’s base
salary. Furthermore, the company will pay the pro-rated
percentage of the success-based compensation for the
period of time served in the year of resignation. The
service contracts of the members of the Management
Board do not provide for any other compensation if the
service relationship is terminated as a result of a change
in control.
The compensation system for the Management Board
and the significant contractual elements were reviewed
again by the full Supervisory Board in 2011. In accordance
with the recommendation of the Personnel Committee,
this review yielded the result that the Management Board
compensation system complies with applicable laws and
regulations, and particularly that it is also appropriate. In
drawing that conclusion, the Supervisory Board took
care to ensure that employment contracts that were
amended and/or concluded anew, or extended after the
Act on the Appropriateness of Management Board
Compensation (VorstAG) entered into effect, stipulate
that a portion of the variable cash component is deter-
mined on the basis of a three-year appraisal period. The
Supervisory Board is convinced that the Management
Board compensation system is geared to the sustainable
development of the company.
A majority of Management Board members have re-
ceived contractual pension commitments. Payment of
the pension commences upon reaching age 62, if the
Management Board member is no longer in office at this
time. In case of premature departure, a Management
Board member who has been employed with the com-
pany for five years has a vested claim to a pension pay-
ment proportional to the length of his employment with
the company. Payments are also provided for in case of
a complete reduction in earning capacity.
The total compensation granted to the Management
Board in financial year 2011 amounted to
€ 17.0 million (PY: € 17.9 million). The fixed compensa-
tion amounted to € 8.7 million (PY: € 8.7 million); that
amount also includes the amounts for fringe benefits
(company car and security expenses). The total variable
compensation amounted to € 8.3 million (PY:
€ 9.2 million). Accordingly, the fixed compensation,
including fringe benefits, represented 51 % of the total
compensation granted in 2011 (PY: 49%).
Combined Management Report 95
Corporate Governance Report
As in the prior year, no long-term variable compensation
components were granted in the form of stock-based
compensation in financial year 2011.
To cover the company’s pension obligations to Man-
agement Board members, pension provisions were
increased by an amount of € 0.8 million in 2011 (PY:
€ 1.2 million). No loans or advances were granted to
members of the Management Board in financial year 2011.
Axel Springer AG does not disclose the total compensa-
tion of individual Management Board members by name,
given that Sections 314 (2) and 286 (5) HGB expressly
place the disclosure of Management Board compensa-
tion by name under the reservation of a differing resolu-
tion of the annual shareholders’ meeting with a qualified
majority of the share capital represented upon the adop-
tion of the resolution. The annual shareholders’ meeting
of Axel Springer AG held on April 23, 2010, adopted
such a resolution with the requisite majority. The reason
for is that Axel Springer AG’s competitors do not dis-
close itemized compensation either.
Supervisory Board
The compensation of the Supervisory Board is set by the
annual shareholders’ meeting; it is regulated in Article 16
of the Articles of Incorporation of Axel Springer AG.
Accordingly, the compensation is comprised of fixed and
variable components. The Supervisory Board receives a
fixed annual compensation of € 2.0 million. In addition,
the Supervisory Board receives an additional compensa-
tion of € 3 thousand for every cent (€ 0.01) by which the
dividend per share distributed to the shareholders ex-
ceeds € 0.05, but at least 4.0 % of the share capital in
relation to one share. The Supervisory Board also re-
ceives compensation in the amount of € 300 thousand if
the basic earnings per share for the financial year (based
on the share of the company’s shareholders in consoli-
dated net income) exceeds the basic earnings per share
of the third previous financial year, calculated in the same
manner – with due consideration given, where applicable,
to the re-apportionment of share capital resolved by the
annual shareholders’ meeting of April 14, 2011 – by 15 %
or more. For financial years in which positive consolidat-
ed profits cannot be applied as a reference benchmark,
an amount of € 1.00 per share shall apply as the refer-
ence benchmark for calculating the increase in annual
profits. For financial years with a net consolidated loss,
only the fixed compensation of € 2.0 million will be paid.
The Supervisory Board decides how the aforementioned
amounts are distributed among its members, with ap-
propriate consideration given to their activities as chair-
man and in the committees.
For financial year 2011, the Supervisory Board received
total compensation of € 2.5 million (PY: € 2.8 million).
The variable components of this compensation amount-
ed to € 0.5 million (PY: € 0.8 million) and was based
completely (PY: in the amount of € 0.5 million), on the
dividend proposal of the Management Board and Super-
visory Board, and is therefore subject to the adoption of
the corresponding resolution by the annual shareholders’
meeting. No further variable compensation was granted
for financial year 2011. In the prior year, the variable
compensation had contained an amount of € 0.3 million
because the basic earnings per share in financial year
2010 had exceeded the basic earnings per share of
financial year 2007, calculated in the same manner, by
15 % or more.
In addition, the company reimburses all members of the
Supervisory Board for their expenses and for the value
added taxes payable on their compensation. The com-
pany pays the premium for the D&O insurance taken out
for members of the Supervisory Board. One member
of the Supervisory Board is paid an annual salary of
€ 0.1 million for his services as an author.
Contrary to Section 5.4.6 sentences 6 and 7 of the German
Corporate Governance Code, the compensation paid to
members of the Supervisory Board, as well as the com-
pensation paid by the company to them for services
rendered personally, are not presented in the Corporate
Governance Report, since Axel Springer AG’s competi-
tors do not disclose such information either.
96 Annual Report 2011 Axel Springer AG
The stock options can only be exercised if the average
price of the Axel Springer share during a period of three
months prior to being exercised is at least 30 % higher
than the baseline values of € 30.00 for Tranche A and
€ 35.00 for Tranche B, and if the percentage increase in
the price of the Axel Springer share is greater than the
appreciation of the DAX stock index over the same peri-
od. Each stock option grants the right to payment of an
amount equal to the appreciation of the Axel Springer
share, but not in excess of a defined maximum amount
(€ 60.00 for Tranche A, € 70.00 for Tranche B); this
amount is the difference between the volume-weighted
average share price during the last three months prior to
exercising the stock options and the baseline value. The
first day of the month determines the beginning and end
of the corresponding period.
Beneficiaries are obligated to hold one share of Axel
Springer AG for every ten stock options as a personal
investment. Disposing of these shares prior to exercising
the options would result in the stock options being for-
feited at the rate of one share for each ten stock options.
The total value of the Virtual Stock Option Plan 2011 at
the grant date was € 2.4 million. For more information on
the Virtual Stock Option Plan 2011 for selected senior
executives, see also the disclosures in the notes to the
consolidated financial statements, Section (12).
Share-based compensation of senior executives
In addition to the Virtual Stock Option Plans 2009 and
2012 for Management Board members, Axel Springer
also introduced a virtual stock option plan for selected
senior executives in 2011 (referred to hereinafter as the
Virtual Stock Option Plan 2011).
Effective October 1, 2011, a total of 945 thousand virtual
stock options were granted to senior executives of Axel
Springer AG, with each beneficiary receiving stock op-
tions under Tranche A and stock options under Tranche
B. The virtual stock options under Tranche A have a term
of four years, that is, until September 30, 2015, and can
be exercised at the earliest after two years, that is, on
October 1, 2013. The virtual stock options under
Tranche B have a term of six years, that is, until Septem-
ber 30, 2017, and can be exercised at the earliest after
four years, that is, on October 1, 2015.
Provided that the beneficiary is employed by the compa-
ny at least until the expiration of the respective vesting
period, all virtual stock options may become vested. If
the employment relationship is terminated before the
expiration of the respective vesting period, but after the
lapse of one year of the vesting period, one half of the
virtual stock options granted under Tranche A will be-
come vested; one fourth of the virtual stock options
granted under Tranche B become vested upon the lapse
of each year of the vesting period. They will not become
vested if the beneficiary resigned without reasonable
cause or if Axel Springer AG or an affiliated company
terminated the employment relationship with reasonable
cause; in such cases, all virtual stock options will
be forfeited. Another precondition for vesting is the
achievement of a performance or outperformance target
related to the share price of the Axel Springer share.
97
Report of the
Supervisory Board
Report of the Supervisory Board 97
Corporate Governance Report
In financial year 2011, the Supervisory Board performed
all the duties incumbent upon it by virtue of applicable
laws, the company’s Articles of Incorporation, and internal
rules of procedure. In the spirit of sound corporate gov-
ernance, the Supervisory Board worked closely and trust-
fully with the Management Board in an advisory role and
supervised the management of the company. The Man-
agement Board informed the Supervisory Board in detail,
regularly and promptly, both in writing and orally, about
the company’s situation and development, important
business transactions, as well as the risk management
system, the Internal Control System (ICS), and the com-
pliance management system. The Management Board
also kept the Supervisory Board informed of significant
events in the time between its meetings. In addition, the
Supervisory Board Chairman and the Management Board
Chairman held information and consultation meetings on
a regular basis. It was not necessary in financial year 2011
for the Supervisory Board to inspect company books and
documents beyond those presented during the normal
course of reporting by the Management Board.
The Supervisory Board discussed with the Management
Board all matters of crucial importance for the company,
especially the company’s business plan, the implementa-
tion of the company’s business strategy, large capital
expenditure projects, and personnel matters. Further-
more, the Supervisory Board discussed important specif-
ic transactions of significance to the company’s future
development and adopted resolutions on those transac-
tions and measures for which the participation of the
Supervisory Board is required by law, by the company’s
Articles of Incorporation or by the Management Board’s
internal rules of procedure.
The Supervisory Board held a total of five meetings in
2011, three of which in the first half and two in the
second half of the calendar year. All members of the
Supervisory Board attended at least three of these meet-
ings. When necessary, Supervisory Board resolutions
were adopted by way of written circulation.
Composition of the Supervisory Board
At the annual shareholders’ meeting of April 14, 2011,
Dr. Nicola Leibinger-Kammüller was elected to the
Supervisory Board at the proposal of the Supervisory
Board, which was based on the recommendation of the
Nominating Committee of the Supervisory Board.
Dr. Nicola Leibinger-Kammüller is the Chairwoman of
the Management Board of TRUMPF GmbH + Co. KG,
Ditzingen. She had initially been appointed to the Super-
visory Board of Axel Springer AG by resolution of the
Charlottenburg Local Court of July 13, 2010, for a limited
term of office until the regular annual shareholders’ meet-
ing in 2011, as the successor to Brian Powers, who had
resigned from the Supervisory Board in May 2010. Her
term of office now ends upon the closing of the annual
shareholders’ meeting in 2014.
Significant matters addressed by the
Supervisory Board
In its meeting of February 2, 2011, the Supervisory
Board discussed and approved the financial plan 2011
submitted by the Management Board. It also discussed
and duly noted and approved the Management Board’s
plan to conduct a share split (which was realized in April
2011 by a resolution of the annual shareholders’ meet-
ing). The Management Board informed the Supervisory
Board of the preliminary numbers concerning the com-
pany’s business performance in financial year 2010, and
reported on the company’s plan to acquire the French
company SeLoger.com S.A., and presented a status
report on the latest developments in the rotogravure
market. The Supervisory Board also discussed the
98 Annual Report 2011 Axel Springer AG
development of the company’s value in the years from
1985 to 2010, on the basis of a Management Board
presentation. It also resolved to extend the term of office
of a Management Board member and extend the Man-
agement Board employment contract accordingly.
In its meeting of March 1, 2011, the Supervisory Board
devoted its attention primarily to the separate financial
statements of the parent company and the consolidated
financial statements of the Group at December 31, 2010
(including, in each case, the management report and
Group management report), as well as the report on the
company’s dealings with affiliated companies (Depend-
ency Report), the Management Board’s profit utilization
proposal for financial year 2010, and the Corporate
Governance Report issued jointly with the Management
Board. Based on a recommendation of the Audit Com-
mittee, it also discussed the proposal for the election of
the independent auditor for financial year 2011, to be
submitted to the annual shareholders’ meeting. The
Supervisory Board also discussed the agenda for the
annual shareholders’ meeting in 2011 and adopted
a resolution on the report for financial year 2010 to be
submitted to the annual shareholders’ meeting and on
the updated version of the Declaration of Conformity that
was published on November 8, 2010. The Management
Board also reported to the Supervisory Board on the
status of plans to acquire SeLoger.com S.A. and to pur-
chase a majority interest in Juno Internet GmbH (kaufDA).
The Supervisory Board also adopted a resolution of the
(re-)appointment of a Management Board member and
the corresponding extension of his Management Board
employment contract. On March 14, 2011, the Supervi-
sory Board adopted a resolution by way of written circula-
tion to approve the share ownership plan for employees
with target agreements or profit-sharing bonuses, which
was implemented in financial year 2011.
In its meeting of April 14, 2011, directly preceding the
annual shareholders’ meeting 2011, the Supervisory
Board discussed the upcoming annual shareholders’
meeting. In addition, the Management Board reported to
the Supervisory Board on the company’s business per-
formance in the first quarter of the financial year.
In its meeting of July 1, 2011, the Supervisory Board
appointed Jan Bayer and Ralph Büchi to the company’s
Management Board, effective January 1, 2012 in both
cases, in view of the expiration of the Management
Board appointment of Rudolf Knepper upon the close
of December 31, 2011. Jan Bayer is responsible for the
Management Board division WELT Group and Printing;
Ralph Büchi is responsible for International Business. In
addition, the Supervisory Board extended the term of
office of another Management Board member and re-
solved the corresponding extension of his Management
Board employment contract. The Management Board
reported to the Supervisory Board on the formation of
Axel Springer Pensionstreuhand e. V. in connection with
the conclusion of a Contractual Trust Agreement to
permanently secure the company’s pension liabilities,
and on the acquisition of M4N, a leading Dutch full-
service provider of affiliate marketing solutions, by
ZANOX.de AG, and on the status of the company’s
investment in Do⁄an TV Holding A.S., Turkey, and the
company’s business performance in the months of Jan-
uary to May of the current financial year. The Manage-
ment Board also informed the Supervisory Board about
the status of the actions for nullification of resolutions of
the annual shareholders’ meetings in the years 2008,
2009, and 2010, which have been filed against the com-
pany by the shareholder Dr. Oliver Krauß, and about the
suggestion of the Berlin Regional Court to conduct set-
tlement negotiations with Dr. Oliver Krauß.
In its meeting of November 4, 2011, the Supervisory
Board primarily discussed the business strategy of Axel
Springer AG since 2002, which has been to pursue
profitable growth on the basis of the strategic goals of
extending the company’s market leadership position in
the German-language core business and pursuing inter-
nationalization and digitization, on the basis of a com-
prehensive presentation by the Management Board. The
Management Board also reported to the Supervisory
Board on the development of key acquisitions since
2006, particularly in the Digital Media segment, and on
the development of the eastern Europe joint venture
Ringier Axel Springer Media AG. The Supervisory Board
also adopted a resolution on the Declaration of Conform-
ity for 2011. Furthermore, the Supervisory Board con-
ducted a self-evaluation on the basis of questionnaires;
Report of the Supervisory Board 99
after discussing the results of the questionnaires com-
pleted by the Supervisory Board members, it concluded
that the Supervisory Board continues to work in an effi-
cient manner. The Supervisory Board also reviewed the
Management Board compensation system and conclud-
ed that it fulfills the legal requirements and particularly
also that it is appropriate and suitable for promoting the
sustainable development of the company’s business. In
addition, the Supervisory Board heard reports on the
company’s business performance in the months of Jan-
uary to September 2011, among other matters; it also
noted the recommended non-trading periods for shares
of Axel Springer AG in calendar year 2012, preceding the
publication of the annual financial statements and the
quarterly results. Based on the recommendation of its
Executive Committee, finally, the Supervisory Board
adopted a new executive organization chart for the Man-
agement Board, to take effect as of January 1, 2012.
Please refer to page 38 for information on the organiza-
tion of Management Board divisions after that date. In
addition, the Supervisory Board adopted a resolution on
the Management Board employment contracts to be
concluded with the newly appointed Management Board
members Jan Bayer and Ralph Büchi, both effective as
of January 1, 2012 and including, in both cases, the
granting of a long-term share-based compensation
component in the form of virtual stock options as per the
Virtual Stock Option Plan 2012 (please refer to page 93
for more information on this subject).
Conflicts of interest
The following potential conflict of interest arose on the
Supervisory Board in financial year 2011: In the meeting of
March 1, 2011, the Management Board informed the
Supervisory Board about the upcoming acquisition of a
majority interest in Juno Internet GmbH (kaufDA), which
had been previously approved by the Executive Commit-
tee. Before the corresponding agenda item was taken up,
the Supervisory Board member Dr. Michael Otto left the
meeting room in order to avoid the appearance of a pos-
sible conflict of interest, because the Otto Group was one
of kaufDA’s original financial investors that sold its shares
to Axel Springer AG in connection with the acquisition of a
majority interest by Axel Springer AG.
Corporate Governance
The Management Board and Supervisory Board issued
their joint Declaration of Conformity pursuant to Section
161 AktG at the beginning of November 2011. The decla-
ration has been made permanently accessible on the
company’s website. Axel Springer AG adheres to nearly
all the recommendations of the German Corporate Gov-
ernance Code.
The Declaration of Conformity of November 2011 contain-
ing justifications of the few exceptions to the recommen-
dations of the German Corporate Governance Code is
presented on page 85 of the Annual Report.
Additional information on corporate governance in the
Axel Springer Group may be found in the joint Corporate
Governance Report of the Management Board and Su-
pervisory Board (see page 85).
Work of the committees of the
Supervisory Board
In the interest of performing its duties in an efficient man-
ner, the Supervisory Board has formed an Executive
Committee, a Personnel Committee, an Audit Committee,
and a Nominating Committee as permanent committees.
The Chairman of the Supervisory Board chairs the meet-
ings of the committees and reports to the Supervisory
Board on the work of the committees in the next meeting
of the Supervisory Board. In connection with the actions
for nullification of resolutions of the annual shareholders’
meetings in the years 2008, 2009, and 2010, which have
been brought by Dr. Oliver Krauß, the Supervisory Board
also formed a committee that was charged with the task
of adopting a resolution in lieu of the Supervisory Board
on a possible settlement with Dr. Oliver Krauß. This
committee was composed of Dr. Giuseppe Vita, Klaus
Krone, and Dr. Gerhard Cromme. However, settlement
negotiations with Dr. Oliver Krauß ended unsuccessfully
in early August of financial year 2011, and the Berlin
Regional Court was notified of that fact. Therefore,
the committee did not meet or adopt resolutions in the
financial year 2011.
100 Annual Report 2011 Axel Springer AG
Notwithstanding the general responsibility of the full
Supervisory Board, the Executive Committee is re-
sponsible for fundamental matters related to publishing
and journalism and for matters of strategy, financial plan-
ning, capital expenditures, and the financing of capital
expenditures. It is also responsible for preparing deci-
sions on the organization of the Management Board, the
approval of sales of registered shares of Axel Springer
AG and subscription rights for such registered shares,
and for approving certain management actions that
require the approval of the Supervisory Board, which
have been delegated to the Executive Committee. The
members of the Executive Committee are Dr. Giuseppe
Vita, Chairman, Dr. h. c. Friede Springer, Vice Chairwom-
an, Dr. Gerhard Cromme, and Klaus Krone.
The Executive Committee held five meetings in financial
year 2011, which were regularly attended also by the
members of the company’s Management Board. At
these meetings, the Executive Committee discussed and
adopted resolutions on various matters, including ap-
provals to purchase a majority interest in Juno Internet
GmbH (kaufDA), to enter into a profit/loss transfer and
management control agreement between the company
and its subsidiary WBV Wochenblatt Verlag GmbH as
the dependent company, to enter into another manage-
ment control and profit/loss transfer agreement between
Ullstein GmbH and its subsidiary B.Z. Ullstein GmbH as
the dependent company, and to annul the management
control and profit-loss transfer agreement that had been
in effect between the company and its subsidiary Com-
merz-Film GmbH as the dependent company. The Ex-
ecutive Committee also resolved to harmonize the pro-
cess of approving sales of registered shares of Axel
Springer AG with respect to corporate groups (for in-
stance, including affiliated companies of the applicant). In
addition, the Executive Committee prepared the resolu-
tion to be adopted by the full Supervisory Board on the
division of responsibilities among Management Board
members, effective January 1, 2012.
The Executive Committee also approved a number of
other matters, including the increased offer price in con-
nection with the takeover offer for SeLoger.com S.A., the
purchase of land adjacent to the company’s publishing
house in Berlin, the revision of the shareholder agree-
ment with the co-shareholders of Idealo GmbH, the
successive acquisition of shares in the publishing house
in Hamburg, which had previously been financed by
investment funds, and the transfer of those shares to
Axel Springer Pensionstreuhand e. V. or the successive
transfer of the corresponding purchase rights held by the
company to Axel Springer Pensionstreuhand e. V., the
acquisition of Netmums Ltd. by auFeminin.com S.A., and
the purchase of a majority interest (in equal parts with
Mondadori) in the French automotive classified ads portal
AutoReflex.com. The Supervisory Board also approved
the increase in the shareholding held by SeLoger.com
S.A. in iProperty, the operator of Asia’s leading real es-
tate portal, from 9.1 % to 16.1 %, the purchase of a
majority interest in Visual Meta GmbH (shopping portal
“Ladenzeile”) and the sale of a roughly 11 % investment
in Immonet GmbH, accompanied by the termination of a
management control and profit/loss transfer agreement
in effect between the company, as the controlling com-
pany, and Immonet GmbH, as the dependent company.
The Executive Committee also adopted a resolution
granting permission to transfer shares in Axel Springer
AG pursuant to Article 5 para. 3 of the company’s Arti-
cles of Incorporation. The Management Board reported
to the Executive Committee on a number of matters,
including the status of the plan to acquire SeLoger.com S.A.
and the company’s investment in Do⁄an TV Holding A.S.
The Personnel Committee is responsible in particular
for preparing decisions on the appointment and dismis-
sal of Management Board members. It is also responsi-
ble for preparing the resolutions to be adopted by the
Supervisory Board on the compensation of individual
members of the Management Board; in all other matters
pertaining to employment contracts, the Personnel
Committee approves resolutions in lieu of the Superviso-
ry Board. The Personnel Committee also adopts resolu-
tions in lieu of the Supervisory Board in matters pertain-
ing to the extension of loans within the meaning of Sec-
tions 89, 115 AktG; the same applies to the approval of
contracts with Supervisory Board members pursuant to
Section 114 AktG. The responsibilities of the Personnel
Committee also include representing the company in
transactions with individual Management Board mem-
bers. Finally, the Personnel Committee decides on the
approval of the transactions requiring the approval of the
Report of the Supervisory Board 101
Supervisory Board, which have been delegated to the
Personnel Committee. The members of the Personnel
Committee are Dr. Giuseppe Vita, Chairman, Dr. h. c.
Friede Springer, and Dr. Gerhard Cromme.
The Personnel Committee held four meetings in financial
year 2011. Among other matters, it prepared the resolu-
tions concerning the appointment of the new Management
Board members Jan Bayer and Ralph Büchi and the set-
ting of their compensation, including a long-term share-
based compensation component, in both cases. It also
prepared the resolutions to be adopted by the full Supervi-
sory Board concerning the extension of the terms of office
of various Management Board members and the associat-
ed extension of their Management Board employment
contracts. The Personnel Committee also discussed the
introduction of a virtual stock option program for selected
senior executives of the company and the preparation of a
review of the Management Board compensation system by
the Supervisory Board, among other matters.
Notwithstanding the responsibility of the full Supervisory
Board, the Audit Committee is responsible for prepar-
ing the decision on the adoption of the separate financial
statements of the parent company and the approval of
the consolidated financial statements of the Group, by
means of conducting a preliminary review of the separate
financial statements, the Dependency Report, and the
consolidated financial statements, as well as the man-
agement report for the company and the management
report for the Group, the review of the profit utilization
proposal, and the discussion of the audit report with the
independent auditor, among other matters. It is also
responsible for reviewing the interim financial statements
and interim reports, and for discussing the report of the
independent auditor on the critical review of the interim
financial statements. The responsibilities of the Audit
Committee also include reviewing the risk management
system and matters related to compliance. With regard
to the audit of the financial statements, it is responsible
for preparing the proposal of the Supervisory Board to
the annual shareholders’ meeting on the election of the
independent auditor and the engagement of the inde-
pendent auditor, and for adopting audit priorities, among
other matters. The Audit Committee is composed of
Dr. Giuseppe Vita, Chairman, Dr. h. c. Friede Springer,
Klaus Krone, and Oliver Heine.
The Audit Committee held five meetings in 2011. It kept
itself informed of the status, scope, execution, and results
of the audit of the separate financial statements of the
parent company and the consolidated financial state-
ments of the Group for 2010, prepared the decisions of
the Supervisory Board on the adoption of the separate
financial statements and the approval of the consolidated
financial statements, and reviewed the interim financial
statements and interim reports for the year 2011. In addi-
tion, the Audit Committee dealt with the preparation of
the resolution to be adopted by the full Supervisory Board
with regard to the proposal to the annual shareholders’
meeting for re-engaging the independent auditor for 2010
to audit the financial statements for 2011.
In this regard, the Supervisory Board received a written
confirmation of independence from Ernst & Young
GmbH Wirtschaftsprüfungsgesellschaft. In addition, the
Audit Committee dealt with the audit priorities to be
considered by the auditor in auditing the financial state-
ments for 2011 and the engagement of the independent
auditor, including the determination of the auditor’s fee.
The Audit Committee dealt intensively with the risk man-
agement system and internal control system (ICS), as
well as the compliance management system, and re-
viewed the work of the internal audit function, including
the internal audit plan for 2011.
The Nominating Committee prepares the proposal of
the Supervisory Board to the annual shareholders’ meet-
ing on the election of Supervisory Board members; in
particular, it proposes suitable candidates to the Supervi-
sory Board, also in consideration of the diversity criteria
adopted by the Supervisory Board. It develops and re-
views job profiles relative to the qualifications expected of
Supervisory Board members by the company, and con-
tinually adapts them to suit changing requirements. The
Nominating Committee is composed of Dr. Giuseppe Vita,
Chairman, Dr. h. c. Friede Springer, and Dr. Michael Otto.
The Nominating Committee held two meetings in finan-
cial year 2011. In particular, it prepared the resolution to
be adopted by the Supervisory Board on the proposal to
102 Annual Report 2011 Axel Springer AG
be presented to the annual shareholders’ meeting on the
appointment of Dr. Nicola Leibinger-Kammüller to the
Supervisory Board.
Separate financial statements of the parent
company and consolidated financial
statements of the Group, and management
report for the parent company and
management report for the Group
Ernst & Young GmbH Wirtschaftsprüfungsgesellschaft
audited the annual financial statements of the parent
company and the consolidated financial statements of
the Group, as well as the management report for the
parent company and the management report for the
Group, all of which were prepared by the Management
Board for financial year 2011, and issued an unqualified
audit opinion in every case. In connection with the audit,
the independent auditor also noted in summary that the
Management Board has implemented a risk manage-
ment system that fulfills the requirements of law, and that
this system is generally suitable for the early detection of
any developments that could endanger the company’s
survival as a going concern.
The aforementioned documents and the proposal of the
Management Board for the utilization of the distributable
profit, as well as the audit reports of Ernst & Young
GmbH Wirtschaftsprüfungsgesellschaft, were provided
to all members of the Supervisory Board in a timely
manner. The documents were discussed extensively in
the presence of the independent auditor in the meetings
of the Audit Committee of February 22, 2012 and March
6, 2012. At these meetings, the independent auditor
reported on the principal findings of their audit. No defi-
ciencies in the internal control and risk management
system, as it relates to the financial accounting process,
were noted. No circumstances that would cast doubt on
the impartiality of the independent auditor arose. The
independent auditor explained further the scope, priori-
ties, and costs of the audit. Besides auditing the financial
statements, the independent auditor provided other ser-
vices to the company (including its affiliated companies) in
the amount of € 357.0 thousand in financial year 2011.
The Audit Committee reported on the results of its exam-
ination to the full Supervisory Board. At its meeting of
March 6, 2012, the Supervisory Board reviewed the
documents in question, having noted and duly consid-
ered this report of the Audit Committee and the reports
of Ernst & Young GmbH Wirtschaftsprüfungsgesellschaft,
and having discussed them with the independent auditor,
who was in attendance.
The Supervisory Board acknowledged and approved the
audit results. Based on the results of its own review, the
Supervisory Board had no objections to raise. The Su-
pervisory Board approved the annual financial statements
of the parent company and the consolidated financial
statements of the Group, as well as the management
report for the parent company and the management
report for the Group, all of which were prepared by the
Management Board. Accordingly, the 2011 annual finan-
cial statements of Axel Springer AG were officially adopted.
The Supervisory Board also reviewed the proposal of the
Management Board concerning the utilization of the
distributable profit and concurred with that proposal, in
consideration of the company’s financial year net income,
liquidity, and financing plan.
The Management Board also submitted its report on the
company’s dealings with related parties pursuant to
Section 312 of the German Stock Corporations Act
(AktG) to the Supervisory Board. The Supervisory Board
was also in receipt of the corresponding audit report by
Ernst & Young GmbH Wirtschaftsprüfungsgesellschaft.
Both reports were also provided to each member of the
Supervisory Board in advance. The audit opinion of the
independent auditor reads as follows:
“Based on the audit and evaluation conducted in ac-
cordance with our professional duties, we hereby con-
firm that
1. the factual information contained in the report is
correct; and
2. the consideration provided by the company in
respect of the legal transactions mentioned in the
report was not inappropriately high.”
Report of the Supervisory Board 103
The Supervisory Board also reviewed the report of the
Management Board on the dealings with related parties
pursuant to Section 312 AktG and the independent
auditor’s report on this subject. At the Supervisory Board
meeting of March 6, 2012, the independent auditor also
reported orally on the principal findings of their audit. The
Supervisory Board acknowledged and approved the
report of the independent auditor. Based on the final
results of its own review, the Supervisory Board had no
objections to raise with respect to the results of the audit
report of the independent auditor or the Management
Board’s declaration on the report pursuant to Section
312 (3) AktG.
Thanks to the members of the
Management Board and to all employees
Rudolf Knepper left Axel Springer at the end of 2011,
after nearly 40 years of service with the company. He
served on the Management Board for 17 years, during
which time he earned the extraordinary appreciation and
respect of his colleagues, employees and business part-
ners for his engaging, forthright, and approachable style
of communicating and negotiating. He embodied the
principles of continuity, loyalty, and reliability, but he also
evinced the necessary creative drive in advancing the
digital transformation of our company. For that, the
Supervisory Board wishes to express its heartfelt gratitude.
Finally, the Supervisory Board wishes to thank all mem-
bers of the Management Board and all employees for
their outstanding work in the past year.
Berlin, March 6, 2012
The Supervisory Board
Dr. Giuseppe Vita
Chairman
Supervisory Board
Dr. Giuseppe Vita
Chairman
Dr. h. c. Friede Springer
Vice Chairwoman
Dr. Gerhard Cromme
Chairman of the Supervisory Board of ThyssenKrupp AG
Oliver Heine
Lawyer and partner in the law firm of
Oliver Heine & Partner
Klaus Krone
Member of the Supervisory Board of Axel Springer AG
Dr. Nicola Leibinger-Kammüller
Chairwoman of the Management Board of
TRUMPF GmbH + Co. KG
Prof. Dr. Wolf Lepenies
University Professor (emer.) FU Berlin;
Permanent Fellow (emer.) at Wissenschaftskolleg
zu Berlin
Michael Lewis
Investment Manager
Dr. Michael Otto
Chairman of the Supervisory Board of Otto GmbH & Co. KG
10 4 ullstein bild
The eventful history of the Axel Springer
publishing house has two focal points: Hamburg
and Berlin – the Hanseatic city on the Elbe, where
the company was founded, and the nation’s
capital, site of the corporate headquarters.
It was the unwavering desire of Axel Springer
that Berlin should one day actually regain its role
as the capital of a reunified Germany. The road
was a long and rocky one. Axel Springer himself
did not live to see his life’s dream become reality:
he died in 1985, four years before the Wall fell.
Had he lived until 2012, he would now be 100 years
old. A retrospective examining the milestones
of his remarkable life can be found online at
meilensteine.axelspringer.de.
ullstein bild 105
The following photos are intended to
selectively contrast a past that was
often gray with today’s colorful reality.
The historic images are from the archives
of ullstein bild, the photo agency of
Axel Springer AG.
“The Berlin Wall is an insult to all
people who love or thirst for freedom.”
Axel Springer, 1976
It wasn’t just the photo that was black and white, the political
situation in Berlin was also gray and bleak in the summer of
1963 as Axel Springer led Prince Bernhard of the Netherlands
and the Prince’s secretary to the Berlin Wall at Brandenburg
Gate. It would take another 26 years until Springer’s call to
“open the gate” would finally become a reality. In 2012, tourists
congregate freely in front of the symbol of the German capital.
“Going to Kochstrasse meant not only
entering the historic newspaper district of
Berlin but also going a way to Germany.”
Axel Springer, 1964
On April 11, 1968, student leader Rudi Dutschke was shot
and critically wounded on Berlin’s Kurfürstendamm. The
gunman was Josef Bachmann, a 23-year-old housepainter
from Munich, but factions of the leftist student movement put
the blame on Axel Springer and his newspapers. Hundreds
of demonstrators tried unsuccessfully to storm the publisher’s
Kochstrasse offices. Eventually some of the company vehicles
were burning.
Today, the section of Kochstrasse that includes the high-rise
offices and Axel-Springer-Passage that opened in 2004 is
named for Rudi Dutschke.
“Why should we recognize a
state, which will not last forever.
We have to wait. And we will
succeed.“ Axel Springer, 1969
On June 4, 1969, U.S. television reporter Hugh
Downs of NBC’s “Today Show” met with Axel
Springer in the main library for an interview. One of
the topics, almost as a matter of course, was the
venue: the publishing house as a beacon of free-
dom in the shadow of the Berlin Wall. The exclusive
journalist club is nearly unchanged today and
remains a popular place for conversations – a
reminiscence of the tradition of one of Europe’s
most modern media companies.
“There is no point in building tall
structures in this world unless you
have an idea that rises even higher:
freedom for all Germans in the heart
of a peaceful Europe.” Axel Springer, 1964
Zimmerstrasse in a neighborhood called “Mitte” in 1990.
The Wall between East Berlin (right) and West Berlin (left)
is still standing, but it lost its purpose in the wake of the
peaceful revolution of November 9, 1989. The buffer zone
that was kept “pristine” for over 28 years has fallen into
disarray, the whitewash tagged with graffiti. German unification
was already a de facto reality, though it would not be formalized
until October 3. In 2012, the former no man’s land has largely
disappeared under new development, but some vacant lots
still bear witness to the divided Berlin. Cobblestones trace
the former footprint of the Wall.
114
Consolidated Financial
Statements
115
Responsibility Statement
116
Auditor’s Report
117
118
119
120
Consolidated Statement
of Financial Position
Consolidated Statement
of Comprehensive Income
Consolidated Statement
of Cash Flows
Consolidated Statement
of Changes in Equity
121
Consolidated Segment Report
Notes to the Consolidated
Financial Statements
122
General information
138
153
160
Notes to the consolidated statement
of financial position
Notes to the consolidated statement
of comprehensive income
Notes to the consolidated statement
of cash flows
160
Notes to the consolidated segment report
161
Other disclosures
Consolidated Financial Statements
Responsibility Statement
115
Responsibility Statement
To the best of our knowledge, and in accordance with
the applicable reporting principles, the consolidated
financial statements give a true and fair view of the finan-
cial position, liquidity and financial performance of the
Group, and the Group management report includes a fair
review of the development and performance of the busi-
ness and the position of the Group, together with a de-
scription of the principal rewards and risks associated
with the expected development of the Group.
Berlin, February 21, 2012
Axel Springer Aktiengesellschaft
Dr. Mathias Döpfner
Jan Bayer
Ralph Büchi
Lothar Lanz
Dr. Andreas Wiele
116 Annual Report 2011 Axel Springer AG
Auditor’s Report
We have audited the consolidated financial statements
prepared by the Axel Springer Aktiengesellschaft, Berlin,
comprising the statement of financial position, the in-
come statement, the statement of recognized income
and expenses, the statement of cash flows, the state-
ment of changes in equity, and the notes to the consoli-
dated financial statements together with the combined
management report of the Axel Springer Group and Axel
Springer AG for the fiscal year from January 1 to Decem-
ber 31, 2011. The preparation of the consolidated finan-
cial statements and the combined management report
of the Axel Springer Group and Axel Springer AG in
accordance with IFRSs as adopted by the EU, and the
additional requirements of German commercial law pur-
suant to Sec. 315a (1) HGB [“Handelsgesetzbuch”:
“German Commercial Code”] are the responsibility of the
parent company’s management. Our responsibility is to
express an opinion on the consolidated financial state-
ments and on the combined management report of the
Axel Springer Group and Axel Springer AG based on
our audit.
We conducted our audit of the consolidated financial
statements in accordance with Sec. 317 HGB and Ger-
man generally accepted standards for the audit of finan-
cial statements promulgated by the Institut der
Wirtschaftsprüfer [Institute of Public Auditors in Germany]
(IDW). Those standards require that we plan and perform
the audit such that misstatements materially affecting the
presentation of the net assets, financial position and
results of operations in the consolidated financial state-
ments in accordance with the applicable financial report-
ing framework and in the combined management report
of the Axel Springer Group and Axel Springer AG are
detected with reasonable assurance. Knowledge of the
business activities and the economic and legal environ-
ment of the Group and expectations as to possible mis-
statements are taken into account in the determination of
audit procedures. The effectiveness of the accounting-
related internal control system and the evidence support-
ing the disclosures in the consolidated financial state-
ments and the report on the situation of the company
Axel Springer AG and the Axel Springer Group are exam-
ined primarily on a test basis within the framework of the
audit. The audit includes assessing the annual financial
statements of those entities included in consolidation,
the determination of entities to be included in consolida-
tion, the accounting and consolidation principles used,
and significant estimates made by management, as well
as evaluating the overall presentation of the consolidated
financial statements and the report on the situation of
the Axel Springer Group and Axel Springer AG. In our
opinion, our audit provides a sufficiently sound basis
for our opinion.
Our audit has not led to any reservations.
In our opinion, based on the findings of our audit, the
consolidated financial statements comply with IFRS as
adopted by the EU, the additional requirements of Ger-
man commercial law pursuant to Sec. 315a (1) HGB,
and give a true and fair view of the net assets, financial
position, and results of operations of the Axel Springer
Group in accordance with these requirements. The
combined management report of the Axel Springer
Group and Axel Springer AG is consistent with the con-
solidated financial statements and as a whole provides
a suitable view of the Group’s position and suitably pre-
sents the opportunities and risks of future development.
Berlin, February 22, 2012
Ernst & Young GmbH
Wirtschaftsprüfungsgesellschaft
Plett
Glöckner
Wirtschaftsprüfer
[German Public Auditor]
Wirtschaftsprüfer
[German Public Auditor]
Consolidated Financial Statements
Consolidated Statement of Financial Position
117
Consolidated Statement of Financial Position
€ millions
ASSETS
Non-current assets
Intangible assets
Property, plant, and equipment
Investment property
Non-current financial assets
Investments accounted for using the equity method
Other non-current financial assets
Receivables from income taxes
Other assets
Deferred tax assets
Current assets
Inventories
Trade receivables
Receivables due from related parties
Receivables from income taxes
Other assets
Cash and cash equivalents
Total assets
€ millions
EQUITY AND LIABILITIES
Equity
Shareholders of Axel Springer AG
Non-controlling interests
Non-current provisions and liabilities
Provisions for pensions
Other provisions
Financial liabilities
Trade payables
Liabilities due to related parties
Other liabilities
Deferred tax liabilities
Current provisions and liabilities
Provisions for pensions
Other provisions
Financial liabilities
Trade payables
Liabilities due to related parties
Liabilities from income taxes
Other liabilities
Total equity and liabilities
Note 12/31/2011 12/31/2010
(4)
(5)
(6)
(7)
(10)
(26)
(8)
(9)
(36)
(10)
(29)
3,308.9
2,569.7
1,908.1
1,115.6
697.9
52.6
486.4
30.6
455.9
30.9
105.5
27.5
686.7
54.3
516.9
40.7
476.1
34.2
131.3
30.6
878.5
1,033.5
28.6
442.4
41.9
42.5
79.1
27.0
385.9
48.8
40.0
95.9
244.0
435.9
4,187.5
3,603.2
Note 12/31/2011 12/31/2010
(12)
1,930.8
1,772.6
1,694.2
1,562.4
236.6
210.2
1,382.8
1,003.5
(13)
(14)
(15)
(36)
(16)
(26)
(13)
(14)
(15)
(36)
279.5
40.8
672.9
1.2
9.7
125.5
253.3
873.9
46.9
143.8
44.0
270.9
17.9
47.6
340.2
43.6
333.7
1.6
11.1
109.1
164.3
827.2
49.2
150.5
22.6
243.7
22.4
66.5
(16)
302.9
272.4
4,187.5
3,603.2
118 Annual Report 2011 Axel Springer AG
Consolidated Statement of Comprehensive
Income
€ millions
Consolidated Income Statement
Revenues
Other operating income
Change in inventories and internal costs capitalized
Purchased goods and services
Personnel expenses
Depreciation, amortization, and impairments
Other operating expenses
Income from investments
Result from investments accounted for using the equity method
Other investment income
Financial result
Income taxes
Net income
Net income attributable to shareholders of Axel Springer AG
Net income attributable to non-controlling interests
Basic earnings per share (in €)
Diluted earnings per share (in €)
1) Based on amount of shares considering the share split with the ratio 1:3 in 2011.
€ millions
Consolidated Statement of Recognized Income and Expenses
Net income
Actuarial gains/losses from defined benefit pension obligations
Currency translation differences
Changes in fair value of available-for-sale financial assets
Changes in fair value of derivatives in cash flow hedges
Other income/loss from investments accounted for using the equity method
Other income/loss
Comprehensive income
Comprehensive income attributable to shareholders of Axel Springer AG
Comprehensive income attributable to non-controlling interests
Note
2011
2010
(18)
(19)
3,184.9
2,893.9
73.3
6.8
150.1
4.0
(20)
– 1,055.7
– 950.6
(21)
(22)
(23)
(24)
(25)
(26)
(27)
(27)
Note
(28)
– 851.6
– 792.9
– 138.8
– 113.5
– 783.9
– 773.9
9.5
– 3.5
13.0
– 8.2
– 18.4
10.2
– 23.1
– 31.2
– 132.0
– 103.6
289.4
257.8
31.6
2.62
2.62
2011
289.4
12.3
– 9.6
0.7
3.5
0.1
7.0
296.4
270.1
26.3
274.1
252.7
21.4
2.73¹)
2.73¹)
2010
274.1
– 14.8
36.9
2.5
1.3
11.5
37.3
311.4
287.1
24.3
Consolidated Financial Statements
Consolidated Statement of Cash Flows
119
Consolidated Statement of Cash Flows
€ millions
Net income
Reconciliation of net income to the cash flow from operating activities
Depreciation, amortization, impairments, and write-ups
Result from investments accounted for using the equity method
Dividends received from investments accounted for using the equity method
Result from disposal of consolidated subsidiaries and business units and intangible assets,
property, plant, equipment, and financial assets
Changes in non-current provisions
Changes in deferred taxes
Other non-cash income and expenses
Changes in trade receivables
Changes in trade payables
Changes in other assets and liabilities
Cash flow from operating activities
Proceeds from disposals of intangible assets, property, plant, and equipment
Proceeds from disposals of consolidated subsidiaries and business units,
less cash and cash equivalents given up in the exchange
Proceeds from disposals of non-current financial assets
Purchases of intangible assets, property, plant, equipment, and investment property
Purchases of shares in consolidated subsidiaries and business units,
less cash and cash equivalents acquired
Purchases of investments in non-current financial assets
Cash flow from investing activities
Dividends paid to shareholders of Axel Springer AG
Dividends paid to other shareholders
Purchase of non-controlling interests
Disposal of non-controlling interests
Issuance of treasury shares
Repayments of liabilities under finance leases
Proceeds from other financial liabilities
Repayments of other financial liabilities
Additions to plan assets
Other financial transactions
Cash flow from financing activities
Cash flow-related changes in cash and cash equivalents
Changes in cash and cash equivalents due to exchange rates
Changes in cash and cash equivalents due to changes in companies included in consolidation
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
€ millions
Cash flows contained in the cash flow from operating activities
Income taxes paid
Income taxes received
Interest paid
Interest received
Dividends received
Note
2011
289.4
2010
274.1
137.7
114.4
(7)
(7)
(29)
3.5
5.4
0.0
2.8
– 9.4
– 0.1
– 36.3
14.1
– 1.3
405.9
0.6
0.6
30.2
– 112.7
18.4
3.9
– 66.1
12.8
– 37.3
15.0
– 58.7
24.2
57.3
358.1
0.4
103.1
16.2
– 59.2
(3)
– 595.3
– 170.5
(29)
(29)
(29)
– 24.7
– 701.2
– 157.3
– 15.5
– 7.3
0.0
9.4
– 0.2
495.5
– 90.6
– 200.6
– 131.2
– 10.5
– 5.5
0.5
261.9
0.0
172.4
– 180.8
– 211.6
– 25.2
– 9.5
109.1
– 186.2
– 0.6
– 5.0
435.9
244.0
0.0
0.0
76.1
233.6
5.1
– 0.1
197.3
435.9
2011
2010
– 196.0
– 154.4
39.4
– 26.3
12.5
19.4
50.2
– 18.6
9.7
17.0
120 Annual Report 2011 Axel Springer AG
Consolidated Statement of Changes in Equity
Accumulated other comprehensive income
Sub-
scribed
capital
Ad-
ditional
paid-in
capital
Accumu-
lated
retained
earnings
Treasury
shares
Currency
translation
Changes in fair value
Available-
for-sale
financial
assets
Deriva-
tives in
cash flow
hedges
Share-
holders of
Axel
Springer
AG
Non-
controlling
interests
Other
equity
Equity
98.9
43.1
1,229.8
– 200.7
13.0
0.0
– 15.5
– 23.4
1,145.2
51.6
1,196.8
252.7
252.7
– 131.2
33.9
33.9
2.5
2.5
1.2
1.2
– 3.2
– 3.2
252.7
34.4
287.1
21.4
2.9
24.3
274.1
37.3
311.4
– 131.2
– 10.5
– 141.6
72.5
189.4
261.9
261.9
0.4
– 1.2
0.2
0.0
146.0
146.0
0.4
– 1.0
0.4
– 2.3
– 1.3
98.9
43.3
1,422.9
– 11.2
46.9
2.5
– 14.2
– 26.6
1,562.4
210.2
1,772.6
257.8
– 157.3
4.5
4.9
– 0.4
10.5
– 1.0
0.5
– 4.6
– 4.6
0.7
0.7
3.5
3.5
12.6
12.6
257.8
12.3
270.1
31.6
– 5.3
26.3
289.4
7.0
296.4
– 157.3
– 15.5
– 172.9
9.4
– 0.4
1.4
10.5
– 0.5
13.6
0.6
9.4
0.9
24.1
0.2
98.9
43.8
1,536.9
– 6.3
42.2
3.3
– 10.7
– 14.0
1,694.2
236.6
1,930.8
€ millions
Balance as of
01/01/2010
Net income
Other income/loss
Comprehensive income
Dividends paid
Re-issuance of treasury
shares
Change in consolidated
companies
Purchase and disposal of
non-controlling interests
Other changes
Balance as of
12/31/2010
Net income
Other income/loss
Dividends paid
Re-issuance of treasury
shares
Change in consolidated
companies
Purchase and disposal of
non-controlling interests
Other changes
Balance as of
12/31/2011
Comprehensive income
0.0
0.0
257.8
0.0
Consolidated Financial Statements 121
Consolidated Segment Report
Consolidated Segment Report
Operating segments
Newspapers National Magazines National
Print International
Digital Media
Services/Holding Consolidated totals
€ millions
2011
2010
2011
2010
2011
2010
2011
2010
2011
2010
2011
2010
External revenues
1,164.9
1,194.2
468.1
486.1
473.5
400.9
962.1
711.8
116.2
100.8
3,184.9
2,893.9
Internal revenues
10.0
8.6
5.3
7.3
43.5
36.2
43.7
36.0
309.9
299.6
Segment revenues
1,175.0
1,202.8
473.4
493.3
517.0
437.1
1,005.8
747.8
426.1
400.5
EBITDA1)
EBITDA margin1)
Thereof income from
investments
Thereof accounted for
using the equity
method
Depreciation, amortiza-
tion, impairments and
write-ups (except from
purchase price
allocations)
EBIT1)
Effects of purchase
price allocations
Non-recurring effects
Segment earnings
before interest and
taxes
Financial result
Income taxes
Net income
282.7
296.0
103.2
101.0
73.8
61.5
158.1
85.8
– 24.4
– 33.7
593.4
510.6
24.3%
24.8%
22.0%
20.8%
15.6%
15.3%
16.4%
12.1%
18.6%
17.6%
2.9
1.7
0.4
– 0.6
4.3
5.4
6.6
6.8
4.9
3.7
19.1
17.0
0.0
0.0
0.3
– 0.8
4.5
5.3
0.1
0.5
0.0
– 2.1
4.9
2.9
– 3.2
– 4.3
– 1.1
– 1.7
– 12.6
– 9.7
– 17.0
– 12.0
– 48.1
– 54.3
– 82.0
– 82.0
279.5
291.7
102.1
99.2
61.2
51.8
141.2
73.8
– 72.5
– 88.0
511.4
428.6
0.0
– 0.5
0.0
6.2
0.0
– 0.3
0.0
1.6
– 22.6
– 9.9
– 30.8
– 23.6
– 1.3
– 0.1
– 54.7
– 33.6
– 8.5
– 3.5
– 2.2
31.0
– 0.7
– 21.4
– 12.2
13.9
279.0
297.8
101.8
100.8
30.1
38.4
108.1
81.2
– 74.5
– 109.4
444.5
408.9
– 23.1
– 31.2
– 132.0
– 103.6
289.4
274.1
1) Adjusted for non-recurring effects and effects of purchase price allocations.
Geographical information
€ millions
External revenues
Non-current segment assets
Germany
Other countries
Consolidated totals
2011
2010
2011
2010
2011
2010
2,136.9
2,081.6
1,048.0
812.3
3,184.9
2,893.9
1,143.7
1,125.0
1,514.9
731.6
2,658.6
1,856.6
122 Annual Report 2011 Axel Springer AG
Notes to the Consolidated Financial
Statements
General information
(1) Basic principles
Axel Springer Aktiengesellschaft (“Axel Springer AG”)
is an exchange-listed stock corporation with its regis-
tered head office in Berlin, Germany. The principal
activities of Axel Springer AG and its subsidiaries (“Axel
Springer Group”, “Axel Springer” or the “Group”) are
described in note (30a).
On February 21, 2012, the Management Board of Axel
Springer AG authorized the consolidated financial
statements for fiscal year 2011 and subsequently
presented them to the Supervisory Board for approval.
The consolidated financial statements were prepared
by application of Section 315a HGB in accordance
with the International Financial Reporting Standards
(IFRS) of the International Accounting Standards Board
(IASB) and the interpretations of the IFRS Interpreta-
tions Committee (IFRS IC) approved by the IASB, in
effect and recognized by the European Union (EU) at
the reporting date. The reporting currency is the Euro
(€); unless otherwise indicated, all figures are stated in
Euro millions (€ millions). Totals and percentages were
calculated based on the non-rounded Euro amounts
and may differ from a calculation based on the report-
ed amounts in millions of Euros.
The consolidated financial statements and consolidat-
ed management report will be published in the Elec-
tronic Federal Gazette in Germany.
(2) Consolidation
(a) Consolidation principle
The consolidated financial statements include Axel
Springer AG and its subsidiaries. Subsidiaries are
entities in which Axel Springer AG is able to control,
directly or indirectly, the financial and operating policies.
The consideration transferred in business combina-
tions is offset against the pro-rated fair value of the
acquired assets and liabilities at the acquisition date.
Any remaining positive difference allocated to our
interests is capitalized as goodwill. Negative differ-
ences are immediately recognized as income. The date
of acquisition is the date when the ability to control the
assets and financial and operating activities of the
acquired entity or business passes to the Axel Springer
Group. We offset differences arising from disposals
and purchases of non-controlling interests.
Associated companies are included in the consolidat-
ed financial statements by application of the equity
method. Associated companies are defined as com-
panies in which the Axel Springer Group can exert
significant influence over the financial and operating
policies of the company. Goodwill and assets and
liabilities included in the amortized carrying amount of
the investment in the associated company are ac-
counted for using the accounting principles applied to
business combinations. The IFRS separate and con-
solidated financial statements of these companies as
at the Axel Springer Group’s reporting date, respec-
tively, serve as the basis for applying the equity meth-
od. Losses from associated companies that exceed
the carrying amount of the investment, or any other
long-term receivables related to the financing of these
companies, are not recognized, unless the Axel
Springer Group is bound by additional contribution
requirements. Intercompany profits and losses are
eliminated. The carrying amounts of investments are
tested for impairment; if impairments exist, they are
written down to the lower recoverable amount.
Consolidated Financial Statements 123
Notes to the Consolidated Financial Statements
(b) Companies included in the consolidated
financial statements
Companies included in the consolidated financial
statements broke down as follows:
“Sächsischer Bote” Wochenblatt Verlag GmbH, Dres-
den, which previously had been included in the course
of full consolidation, was sold at the beginning of
March 2011.
Fully consolidated companies
Germany
Other countries
Fully consolidated special purpose
entities
Germany
Investments accounted for using the
equity method
Germany
Other countries
12/31/2011 12/31/2010
52
65
2
3
3
52
64
3
3
3
Consolidated companies are listed in note (42). The
special-purpose entities included are closed property
funds whose risks and rewards are economically at-
tributable to the Group.
The following changes occurred in 2011:
Effective January 1, 2011, we merged ZZ-Kurier Ge-
sellschaft für Zeitungs- und Zeitschriftenvertrieb mbH,
Hamburg, into Axel Springer Vertriebsservice GmbH,
Hamburg, (formerly Axel Springer Verlag Vertriebs-
gesellschaft mbH), as well as, in Belgrade, Serbia, 24
sata d.o.o., IP Alo Novine d.o.o., and Blic Magazin
d.o.o. into Ringier Axel Springer d.o.o. In addition, in
London, UK, the operating activities of the Perfiliate
Group were transferred to Digital Window Limited. The
five fully-consolidated companies belonging to the
Perfiliate Group were deconsolidated at January 1, 2011.
Our investments in PACE Paparazzi Catering & Event
GmbH, Berlin, enFemenino SARL, Madrid, Spain,
alFemminile s.r.l., Milan, Italy, and Digital Window Inc.,
Wilmington, USA, were fully consolidated for the first
time effective January 1, 2011.
At the beginning of March, 2011, the acquisition of
74.9% of the shares in Juno Internet GmbH, Berlin
(Internet portal kaufDA), was completed. This company
has been fully consolidated since then.
Effective March 1, 2011, we acquired a majority of the
shares in SeLoger.com SA, Paris, France. Since that
time, this company along with three additional subsidi-
aries has been fully consolidated.
The acquisition of 100% of the shares in The Mbuyu
Community B.V., Amsterdam, the Netherlands (M4N),
was completed at the beginning of June 2011. This
company has been included in the consolidated finan-
cial statements since June 1, 2011.
At the end of June 2011, in Zurich, Switzerland,
PartyGuide.ch AG and usgang.ch AG were merged
into Students.ch AG, which was renamed Amiado
Online AG in this context. In Prague, Czech Republic,
Anima Publishers s.r.o., and Axel Springer Praha a.s.
were merged into Ringier Axel Springer CZ a.s. at the
end of June 2011.
With the acquisition of 100% of the shares in Netmums
Limited, Watford, UK, which was completed at the
beginning of August 2011, this company was fully
consolidated.
The newly founded company zanox Sp. z o.o., War-
saw, Poland, has been included in the consolidated
financial statements since September 2011. In Helsinki,
Finland, OY StepStone AB was liquidated and thus
deconsolidated in September 2011.
124 Annual Report 2011 Axel Springer AG
Effective September 1, 2011, real estate assets were
contributed to the Axel Springer Pensionstreuhand e.V.,
Berlin, which is not included in the consolidated finan-
cial statements of Axel Springer. This resulted in the
deconsolidation of Axel-Springer-Immobilien-Fonds-I
Dr. Rühl & Co. KG, Düsseldorf, which had previously
been consolidated as a special-purpose entity.
In October 2011, we acquired 100% of the shares in
CIBLETIC SAS, Paris, France (Internet platform aGites),
which were merged into the SeLoger Group in De-
cember 2011.
A company we founded, zanox Reklam Hizmetleri
Limited Sirketi, Istanbul, Turkey, has been fully consoli-
dated since November 1, 2011.
In December 2011, in Paris, France, we acquired 83%
of the shares in AR Technology SAS, which holds 100%
of the shares in Autoreflex.com SAS, through EMAS
Digital SAS, which we founded together with Mon-
dadori. These companies have been fully consolidated
since December 1, 2011.
Companies we founded, Bonial SAS, Paris, France,
and ZANOX VEICULAÇÃO DE PUBLICIDADE NA
INTERNET LTDA., São Paulo, Brazil, have been fully
consolidated since December 1, 2011.
In addition, we acquired 77.66% of the shares in Visual
Meta GmbH, Berlin (Internet portal ladenzeile.de), which
we have fully consolidated since December 31, 2011.
Variant Press LLC, Moscow, Russia (formerly Axel
Springer RUS), was sold in December 2011. Axel
Springer Editions SAS, Neuilly-sur-Seine, France, as
well as Axel Springer Russland Holding GmbH, Ham-
burg, were deconsolidated at November 30 and De-
cember 31, 2011, respectively.
(c) Acquisitions and divestitures
In the context of our digitization strategy, we signifi-
cantly expanded our digital business in the area of
online classifieds/marketplaces with our takeover of
the majority in the leading French online real estate
portal. In September 2010, we had initially acquired
12.4% of the shares in SeLoger.com SA, Paris, France.
We acquired an additional 61.8% of the shares
through the first phase of the public tender offer and
thus acquired control of SeLoger at the beginning of
March 2011. At the end of the second phase of the
public tender offer, at the end of March 2011, we held
98.7% of the company’s shares. In addition, we
agreed upon options to acquire an additional 0.3% of
the shares. These options also cover the acquisition of
shares in the context of the employee stock option
programs that still exist at SeLoger.
The acquisition costs totaling € 632.5 million included,
above all, the purchase price already paid totaling
€ 624.8 million (thereof € 70.0 million in September
2010) as well as liabilities of € 7.7 million from promis-
es in connection with the employee stock option pro-
grams. The incidental acquisition costs recorded in
other operating expenses amounted to € 3.6 million.
The acquisition was financed both by using our own
funds and by utilization of our credit facility.
Consolidated Financial Statements 125
Notes to the Consolidated Financial Statements
Based on the purchase price allocation, the acquisition
costs could be allocated to the purchased assets and
liabilities at the acquisition date as follows:
€ millions
Carrying
amount
before
acquisition
Adjust-
ment
amount
Carrying
amount
after
acquisition
Intangible assets
1.0
237.2
238.2
Property, plant, and
equipment
Trade receivables
Other assets
Cash and cash equivalents
Trade payables
Financial liabilities
Other liabilities
Deferred tax liabilities
Net assets
Non-controlling interests
Acquisition cost
Goodwill
1.0
13.5
3.5
44.3
– 7.6
– 23.9
– 14.1
0.0
17.9
0.0
0.0
0.0
0.0
0.0
0.0
0.0
– 81.7
155.5
1.0
13.5
3.5
44.3
– 7.6
– 23.9
– 14.1
– 81.7
173.4
1.7
632.5
460.9
Of the other intangible assets acquired, intangible assets
with carrying amounts of € 128.3 million have indefinite
useful lives. The non-tax-deductible goodwill is above all
attributable to inseparable values such as employee
expertise and expected synergy effects from the integra-
tion, and was allocated to the Digital Media segment. As
of December 31, 2011 the goodwill amounted to
€ 464.0 million. The increase resulted from the acquisi-
tion and the subsequent merger of the CIBLETIC SAS.
The gross amount of the acquired trade accounts re-
ceivable was € 16.9 million. Corresponding valuation
allowances in the amount of € 3.4 million were recorded.
In conjunction with a squeeze-out process initiated in
March 2011, the remaining 1.0% of the share capital
was taken over at the beginning of April at a price of
€ 6.5 million and treated in the balance sheet as an
acquisition of non-controlling shares (€ 1.7 million). The
difference in the amount of € 4.8 million was offset in
accumulated retained earnings.
The acquisition date fair value of our investment in
SeLoger held before gaining control equaled its carrying
amount of € 78.3 million.
Since first inclusion, SeLoger contributed to consoli-
dated revenues in the amount of € 79.7 million and to
consolidated net income in the amount of € 16.2 million.
If SeLoger had already been fully consolidated at January
1, 2011, SeLoger would have contributed to consolidat-
ed revenues in the amount of € 94.1 million and to con-
solidated net income in the amount of € 18.6 million.
The additional business combinations completed in the
reporting year related to the acquisitions of Juno Internet
GmbH (kaufDA, 74.9%), The Mbuyu Community B.V.
(M4N, 100%), Netmums Ltd. (NetMums,100%), Visual
Meta GmbH (ladenzeile, 77.66%), and CIBLETIC SAS
(aGites, 100%). In addition, we acquired 83% of the
shares in AR Technology SAS, which holds 100% of the
shares in Autoreflex.com SAS, through EMAS Digital
SAS, which we founded together with Mondadori, in
December 2011. See note 2 (b) on these acquisitions.
Individually, these acquisitions did not have any signifi-
cant effects on the financial position, liquidity, and finan-
cial performance of the Group.
The preliminary consideration transferred for these acqui-
sitions, totaling € 118.6 million, include both the pur-
chase prices paid in the current year and contingent
consideration of € 30.7 million. The acquisition-related
expenses of the purchase recorded in other operating
expenses amounted to € 0.8 million.
126 Annual Report 2011 Axel Springer AG
The contingent consideration resulted from options to
acquire the remaining shares in the companies and from
purchase price adjustment clauses (earn-outs). They
were measured on the basis of the current fair value of
the purchase price adjustment obligation or the option
at the acquisition date. The current fair value depends
significantly on the profit trends of the acquired compa-
nies in the years prior to the payment dates or possible
exercise dates of the options. Contractually these pay-
ment obligations are limited to a maximum of
€ 73.6 million.
Based on the preliminary purchase price allocations, the
accumulated preliminary cost of purchase of these ac-
quisitions could be allocated to the purchased assets
and liabilities at the acquisition date as follows:
€ millions
Carrying
amount
before
acquisition
Adjust-
ment
amount
Carrying
amount
after
acquisition
Intangible assets
0.5
40.0
40.5
Property, plant, and
equipment
Non-current financial assets
Trade receivables
Other assets
Cash and cash equivalents
Provisions and other
liabilities
Trade payables
Deferred tax liabilities
Net assets
Non-controlling interests
Acquisition cost (preliminary)
Other adjustments 1)
Goodwill (preliminary)
0.5
2.8
5.8
2.8
4.8
– 10.2
– 3.3
– 0.5
3.2
0.0
0.0
0.0
0.2
0.0
0.0
0.0
0.5
2.8
5.8
3.1
4.8
– 10.2
– 3.3
– 11.7
– 12.2
28.6
31.9
1.2
118.6
– 17.3
70.6
1) Goodwill adjusted due to indirect acquisition
The purchase price allocations consider all knowledge
and adjusting events about conditions that existed
already at the acquisition date, and have not yet been
completed, particularly due to the closeness in time
between individual acquisitions and the reporting date.
Of the intangible assets acquired in these acquisitions,
intangible assets with carrying amounts of € 11.2 million
have indefinite useful lives. The preliminary, non-tax-
deductible goodwill values of each company are above
all attributable to inseparable values such as employee
expertise and expected synergy effects from the integra-
tion, and were allocated to the Digital Media segment.
Since initial consolidation, these companies have
contributed to consolidated revenues in the amount
of € 21.7 million and to consolidated net income in
the amount of € – 1.5 million. If the acquisitions had
already occurred on January 1, 2011, the consolidated
revenues would have increased by € 51.7 million, and
the consolidated net income would have decreased by
€ – 0.2 million.
Due to the termination of a call-and-put-option agree-
ment, acquisition-related liabilities of € 38.7 million
were derecognized. The non-controlling interests in-
creased by € 22.1 million, corresponding to their share
in net assets (including goodwill) of 25.1%. The residu-
al amount of € 16.6 million increased retained earnings.
The divestitures carried out in the reporting period
collectively had no material effects on the financial
position, liquidity, and financial performance of the Axel
Springer Group.
Acquisitions and divestitures in the prior year:
With the goal of developing eastern European media
activities, Axel Springer AG and Ringier AG, Zurich,
Switzerland, merged their business activities in Poland,
the Czech Republic, Slovakia, and Serbia into the jointly
managed Ringier Axel Springer Media AG, Zurich,
Switzerland, effective July 1, 2010. In addition, we
Consolidated Financial Statements 127
Notes to the Consolidated Financial Statements
€ millions
Carrying
amount
before
acquisition
Adjust-
ment
amount
Carrying
amount
after
acquisition
Intangible assets
12.4
201.5
213.9
41.7
0.0
41.7
Property, plant, and
equipment
Non-current financial
assets
Trade receivables
Other assets
Cash and cash equivalents
Provisions and other
liabilities
Trade payables
16.4
42.8
22.7
64.7
– 24.6
– 20.8
12.7
0.0
0.0
0.0
0.0
0.0
Deferred tax liabilities
– 6.4
– 36.7
Net assets
149.0
177.5
Non-controlling interests
Acquisition cost
Goodwill
29.1
42.8
22.7
64.7
– 24.6
– 20.8
– 43.0
326.5
163.3
226.0
62.8
The carrying amount before acquisition also comprised
the assets and liabilities contributed by us.
Of the other intangible assets acquired, intangible
assets with carrying amounts of € 143.6 million have
indefinite useful lives. The non-tax-deductible goodwill
is above all attributable to inseparable values such as
employee expertise and expected synergy effects from
the integration, and was allocated to the Print Interna-
tional segment.
Since initial consolidation, the joint venture has con-
tributed to 2010 consolidated revenues in the amount
of € 137.9 million and to 2010 consolidated net income
in the amount of € 25.2 million. Of this amount,
revenues of € 86.3 million and a net income of
€ 13.1 million were allocated to the subsidiaries con-
tributed by Ringier. If the formation of the joint venture
had already occurred on January 1, 2010, the joint
venture would have contributed to 2010 consolidated
made a cash contribution of € 38.8 million and an
adjustment payment to Ringier of € 124.8 million. Our
50 % interest in the joint venture is held by AS Online
Beteiligungs GmbH, Berlin, a wholly owned subsidiary
of Axel Springer AG. Due to the agreement to a call
option on the acquisition of a further interest, we have
treated the transaction as a business combination and
included the Ringier Axel Springer Media group in the
consolidated financial statements of Axel Springer AG
effective July 1, 2010.
At the beginning of May 2011, we and Ringier jointly
withdrew the application for cartel approval for the
business combination of our joint business activities in
Hungary for procedural reasons. The contribution of
the Hungarian activities to Ringier Axel Springer Media
and thus initial inclusion of the Hungarian Ringier com-
panies in our consolidated financial statements did not
occur as originally expected by mid-2011. Withdrawal
of the cartel application had no further financial effects
on the financial position, liquidity, and financial perfor-
mance of the Group or the existing joint venture. How-
ever, completion of the business combination contin-
ues to be planned. In the reporting period, we finalized
the preliminary purchase price allocation performed in
2010.
Along with the cash contribution and the adjustment
payment, the consideration transferred totaling
€ 226.0 million also included the carrying amounts
of the assets less liabilities contributed by us of
€ 61.2 million and contingent consideration of
€ 1.2 million. The acquisition-related expenses of
the purchase recorded in other operating expenses
amounted to € 3.2 million.
Based on the purchase price allocation concluded in
2011, the acquisition costs of this business combina-
tion could be allocated to the purchased assets and
liabilities at the acquisition date as follows. No changes
resulted compared to the purchase price allocation
reported at December 31, 2010.
128 Annual Report 2011 Axel Springer AG
revenues in the amount of € 277.0 million and to 2010
consolidated net income in the amount of € 45.4 million.
Of this amount, revenues of € 174.2 million and a net
income of € 29.2 million would have been allocated to
the subsidiaries contributed by Ringier.
The other business combinations completed in the
year 2010 related to the acquisitions of the Perfiliate
Group (100 %), Axel Springer RUS (100 %), Umzugs-
auktion GmbH & Co. KG (51 %), Sohomint GmbH
(72.6 %), AZET sk a.s. (70 %) and the domain
www.billig-fliegervergleich.de. Individually, these acqui-
sitions did not have any significant effects on the finan-
cial position, liquidity, and financial performance of the
Group in 2010.
The consideration transferred for these acquisitions,
totaling € 74.9 million, include both the purchase pri-
ces paid in the year under review and contingent con-
sideration of € 21.9 million. The acquisition-related
expenses of the purchase recorded in other operating
expenses amounted to € 0.9 million.
The contingent consideration resulted from option
rights for the acquisition of the remaining shares in the
companies. They were measured on the basis of the
current fair value of the option at the acquisition date.
The current fair value depends significantly on the profit
trends of the acquired companies in the years prior to
the possible exercise dates of the options. The obliga-
tions were adjusted to € 21.8 million (PY: € 21.9 million)
at December 31, 2011, with effect on income due to
fair value adjustments.
Based on the purchase price allocations concluded in
the 2011 reporting year, the cumulative acquisition
costs of these acquisitions could be allocated to the
purchased assets and liabilities at the acquisition date
as follows. Changes compared to the purchase price
allocations shown at December 31, 2010, resulted
mainly from the identification and evaluation of the
other intangible assets.
€ millions
Carrying
amount
before
acquisition
Adjust-
ment
amount
Carrying
amount
after
acquisition
Intangible assets
2.1
30.0
32.1
0.9
0.1
17.8
1.0
2.1
– 4.9
– 8.1
0.0
10.9
0.0
0.0
0.0
0.0
0.0
0.0
0.0
– 5.3
24.7
Property, plant, and
equipment
Non-current financial assets
Trade receivables
Other assets
Cash and cash equivalents
Provisions and other
liabilities
Trade payables
Deferred tax liabilities
Net assets
Non-controlling interests
Acquisition cost
Other adjustments 1)
Goodwill
0.9
0.1
17.8
1.0
2.1
– 4.9
– 8.1
– 5.4
35.6
4.7
74.9
– 9.5
34.5
1) Goodwill adjusted due to indirect acquisition
Of the other intangible assets acquired in these acqui-
sitions, intangible assets with carrying amounts of
€ 15.6 million have indefinite useful lives. The non-tax-
deductible goodwills are above all attributable to in-
separable values such as employee expertise and
expected synergy effects from the integration, and
were allocated to the segments Digital Media
(€ 32.1 million) or Print International (€ 2.4 million).
Since initial consolidation, these companies have con-
tributed to 2010 consolidated revenues in the amount
of € 59.5 million and to 2010 consolidated net income
in the amount of € 0.2 million. If the acquisitions had
already occurred on January 1, 2010, the 2010 con-
solidated revenues would have increased by
€ 81.1 million, and the consolidated net income
by € 0.6 million.
Consolidated Financial Statements 129
Notes to the Consolidated Financial Statements
(d) Translation of separate financial statements
denominated in foreign currency
Assets and liabilities of subsidiaries for which the func-
tional currency is not the euro have been translated at
the exchange rate in effect on the reporting date. The
goodwill and fair value adjustments of assets and
liabilities related to the acquisition of companies out-
side the European Monetary Union are assigned to the
acquired company and accordingly translated at the
exchange rate in effect on the reporting date.
Items of the income statement of these subsidiaries
have been translated at the weighted average ex-
change rate for the year. Equity components have
been translated at the historical exchange rate at the
date of origination. Foreign exchange differences re-
sulting from the translation have been recognized
within accumulated other comprehensive income
and/or non-controlling interests.
The exchange rates to the euro of foreign currencies
that are significant for Axel Springer Group underwent
the following changes in the past year:
1 € in foreign
currency
Average exchange
rate
Exchange rate on
balance sheet date
Polish zloty
Swiss franc
2011
4.11
1.24
2010 12/31/2011 12/31/2010
4.00
1.37
4.40
1.22
3.97
1.24
Czech koruna
24.56
25.27
25.81
25.30
Hungarian forint
278.48
276.60
310.83
279.91
British pound
0.87
0.85
0.84
0.86
The disposal of our subsidiaries wallstreet:online AG,
Berlin, and wallstreet:online capital AG, Berlin, occurred
in May and August 2010, respectively. The loss on
disposal totaled € 15.4 million. It was disclosed in
other operating expenses.
The disposal of the Solutions business unit of the
StepStone Group was likewise completed in May 2010.
The gain on disposal was € 65.6 million. It was dis-
closed in other operating income (€ 73.7 million), other
operating expenses (€ 2.9 million), and personnel
expense (€ 5.2 million).
The proceeds collected in 2010 from these divestitures
amounted to € 117.2 million. The following table shows
the carrying amounts of the assets and liabilities sold:
€ millions
Goodwill
Other intangible assets
Property, plant, and equipment
Trade receivables
Other assets
Cash and cash equivalents
Provisions and other liabilities
Trade payables
Deferred tax liabilities
Disposal net assets
Non-controlling interests
Proceeds
Gain on disposal
Carrying
amount
14.8
47.7
3.9
14.9
12.4
11.1
– 24.2
– 2.0
– 14.4
64.3
5.3
117.2
58.3
Additional divestitures carried out in 2010 collectively
had no material effects on the financial position, liquidity,
and financial performance of the Axel Springer Group.
130 Annual Report 2011 Axel Springer AG
(3) Explanation of significant accounting and
valuation methods
(a) Basic principles
The accounting and valuation principles applied uni-
formly across the Axel Springer Group in fiscal year
2011 are basically the same as those applied in the
prior year.
For information on the accounting and valuation meth-
ods resulting from new or revised IFRSs and IFRS IC
Interpretations, please refer to note (3q).
(b) Recognition of income and expenses
The Axel Springer Group mainly generates circulation
and advertising revenues. Revenues are recognized at
the time when the significant risks of ownership have
passed to the buyer/the services have been rendered,
the amount of revenue can be reliably measured, and it
is sufficiently probable that the economic benefits will
flow to the enterprise. Revenues are stated net of any
discounts allowed. Revenues from services rendered
over a certain period in an indefinite number of trans-
actions are recognized on a straight-line-basis over the
contractual term.
Circulation revenues encompass the sales of newspa-
pers and magazines to retailers, wholesalers, and sub-
scribers. Revenue is not recognized for that portion of
products sold, which can be expected, on the basis of
historical experience, to be returned. Additionally,
circulation revenues comprise the sale of digital appli-
cations and formats.
The advertising revenues encompass revenues from
sales of advertising spaces in the published newspa-
pers and magazines and the revenues generated in the
categories of display, affiliate marketing, and search in
the Digital Media segment.
Where significant risks and rewards of business activi-
ties do not lie with the Axel Springer Group or the
income is collected in the interest of third parties, only
the corresponding commission income or proportion
of revenue accruing to the Axel Springer Group are
recognized as revenues.
Offers that contain multiple service components are
separated for purposes of revenue recognition when
the delivered components have an independent benefit
and the market values of goods not yet delivered or
services not yet performed can be determined objec-
tively. When these criteria are satisfied and the deliver-
ies and services of outstanding components are pos-
sible and probable even in the case of return of com-
ponents already provided, then revenues are
recognized for the individual separate components
according to the relevant regulations.
Revenues from barter transactions are recognized if
the goods or services exchanged are dissimilar and
the amount of revenue can be measured reliably.
Revenues are measured at the fair value of services
received. If the fair value of the service received under
barter transactions cannot be measured reliably, the
fair value is determined on the basis of the service
rendered.
Other income is recognized when the future inflow of
economic benefits from the transaction can be meas-
ured reliably and was received by the company during
the reporting period.
Operating expenses are recognized either when the
corresponding goods or services are sold or rendered,
or at the time of their origination.
Interest expenses and income are recognized on an
accrual basis in the period of their occurrence. Interest
expenses incurred in connection with the acquisition
and production of qualified assets are capitalized as
assets in the financial statements. Dividend income is
recognized when the legal entitlement is constituted.
Consolidated Financial Statements 131
Notes to the Consolidated Financial Statements
(c) Intangible assets
Internally generated intangible assets are measured as
the sum of costs incurred in the development phase
from the time when the technical and economic feasi-
bility has been demonstrated until the time when the
intangible asset has been completed. The capitalized
production costs include all costs that are directly or
indirectly allocable to the development phase. Costs
for the self-development of websites are capitalized
only when the website serves directly the generation of
revenues. Purchased intangible assets are measured
at cost.
Internally generated and purchased intangible assets
that have a determinable useful life are amortized over
their expected useful lives using the straight-line meth-
od, starting from the time when they become available
for use by the enterprise, as follows:
Software
Licenses
Supply rights
Internet platform
Customer relationships
Useful life
in years
3 – 8
3 – 10
3 – 6
3 – 8
3 – 15
Intangible assets with an indefinite useful life, which
include goodwill, title rights, and brand rights, are
not amortized. At present, the use of these assets
by the company is not limited by any economic or
legal restrictions.
(d) Property, plant, and equipment
Property, plant, and equipment are measured at cost
and depreciated over their expected useful lives using
the straight-line method. Any gains or losses on the
disposal of property, plant, and equipment are recog-
nized as other operating income or expenses.
Leased assets whose economic benefits are attributa-
ble to Axel Springer are recognized as fixed assets and
measured at the present value of the minimum future
lease payments or the lower fair value of the leased
asset and depreciated by the straight-line method over
the minimum contract term, taking any existing residu-
al value into consideration. When it is reasonably cer-
tain that ownership will pass to Axel Springer at the
end of the lease period, such assets are depreciated
over their useful lives. The present value of the pay-
ment obligations associated with the minimum future
lease payments is recognized as a liability.
For purposes of depreciation, the following useful lives
are applied:
Buildings
Leased buidlings
Leasehold improvements
Printing machines
Editing systems
Other operational and business equipment
Useful life
in years
30 – 50
20
5 – 15
12 – 20
3 – 7
3 – 14
Capital investment subsidies and bonuses granted by
the government are recognized when it is reasonably
certain that the subsidies will be granted and the relat-
ed terms and conditions will be fulfilled. Bonuses and
subsidies granted for the acquisition or construction of
property, plant, and equipment are recognized in a
deferred income item within other liabilities. In subse-
quent periods, the deferred income item is released
and recognized as income over the useful life of the
corresponding assets.
(e) Investment property
Investment property intended for lease to third parties
is measured at amortized cost. Such property is
depreciated over a useful life of 50 years using the
straight-line method. For leased assets whose eco-
nomic benefits are attributable to Axel Springer (see
note (3d)). These assets are depreciated over a useful
life of 20 years using the straight-line method.
132 Annual Report 2011 Axel Springer AG
(f) Recognition of impairment losses in
intangible assets, in property, plant, and
equipment, and in investment property
Impairment losses are recognized in intangible assets,
in property, plant, and equipment, and in investment
property when as a result of certain events or changed
circumstances, the carrying amount of the asset ex-
ceeds its recoverable amount (fair value less the costs
to sell or the value in use). If it is not possible to deter-
mine the recoverable amount of an individual asset, the
recoverable amount for the next-higher group of assets
is applied.
Goodwill and intangibles with indefinite useful lives
acquired in the context of business combinations are
tested at least once annually for impairment. In order
to carry out the impairment tests, these assets are
assigned to those cash-generating units or those
cash-generating groups (i.e., each “reporting unit”) that
can be expected to profit from the synergies of the
business combinations. These reporting units repre-
sent the lowest level at which these assets are moni-
tored for management purposes. They generally corre-
spond to individual titles and digital media of the Axel
Springer Group. In the case of integrated business
models, individual titles and digital media are collected
into a single reporting unit.
The impairment test is conducted by determining the
value in use of the reporting units, determined as the
sum of the discounted estimated future cash flows,
which are derived from the company’s medium-term
plan. The planning horizon for the medium-term plan-
ning is five years. The cash flows to be received after
this five-year period are extrapolated on the assump-
tion of a growth rate of 1.5 % (PY: 1.5 %), which does
not exceed the assumed average market or industry
growth rate of the respective reporting units. The dis-
count rates are calculated on the basis of the weighted
average capital costs of the Group, taking country-
specific considerations into account. The discount
rates range from 6.4 % to 10.7 % (PY: from 6.4 % to
12.5 %) after taxes and from 8.4 % to 13.0 % (PY: from
8.5 % to 15.6 %) before taxes.
Estimation uncertainties arise in the following assump-
tions applied in calculating the value-in-use of the
reporting units:
Medium-term planning: The medium-term planning is
determined on the basis of past historical values, and
factors in business-segment-specific expectations
about future market growth. Here, we assume that
cash flows in the electronic media sector will usually
exhibit higher growth rates than in the print sector.
Discount rates: The discount rates reflect the current
market estimates of the country-specific risks attribut-
able to each reporting unit. The discount rate was
estimated on the basis of the average weighted capital
costs of the sector in question.
Growth rates: The growth rates are determined on the
basis of published market research reports for the
sectors in question. In estimating the long-term growth
rates, due consideration was given to the compensa-
tory effects between the different business lines, based
on the adopted strategy of the Group.
Impairment losses are reversed when the recoverable
amount exceeds the carrying amount of the asset. The
reversal is limited to the amount which would have
resulted if previous impairment losses had not been
recognized. A recognized impairment loss in goodwill
is never reversed.
(g) Financial assets and liabilities
Financial assets are mainly composed of cash and
cash equivalents, deferred purchase price receivables,
trade receivables, receivables due from related parties,
loans, investments, securities, and financial derivatives
with positive market values. Financial liabilities are
mainly composed of trade payables, liabilities due to
related parties, liabilities due to banks, contingent
consideration, and financial derivatives with negative
market values.
The initial recognition and derecognition of financial
instruments coincide with the settlement dates of
customary market purchases and sales.
Consolidated Financial Statements 133
Notes to the Consolidated Financial Statements
If reliably measurable, fair values of financial assets and
liabilities are determined on the basis of appropriate
market prices or valuation methods.
A financial asset is derecognized when the contractual
rights to the cash flows from the financial asset have
expired or have been transferred to third parties, or
when the Group has assumed a contractual obligation
to pay the cash flows to a third party, under which the
risks and rewards or the power of control were trans-
ferred. A financial liability is derecognized when the
obligation underlying the liability is settled or annulled,
or has expired.
Investments and securities
Investments that have not been consolidated or ac-
counted for using the equity method in the consolidat-
ed financial statements, as well as securities, are
measured at fair value if it can be determined reliably
on the basis of stock exchange or market prices and
generally accepted valuation methods, respectively.
Otherwise, they are measured at amortized cost. The
valuation methods employed include especially the
discounted cash flow method (DCF method) based on
the expected investment income. The fair value of
investments and securities is not reliably measurable
when either material valuation differences appear in
estimating fair values based on projections and sce-
narios, or when the likelihood of such projections and
scenarios cannot be reliably determined. Any unreal-
ized gains or losses resulting from the changes in fair
value of the financial assets and liabilities, considering
resulting tax effects, are recognized in accumulated
other comprehensive income. Changes in fair value are
not recognized in income until the corresponding non-
current financial assets are sold or an impairment loss
is recognized.
The carrying amounts of investments and securities
are reviewed at every reporting date to determine
whether there are objective indications of an impair-
ment. If an impairment is found to exist, an impairment
loss is recognized and charged to income.
Loans, receivables, and other financial assets
Upon initial recognition, loans, receivables, and other
financial assets are measured at fair value plus trans-
action costs. In subsequent periods, they are mea-
sured at amortized cost, after deduction of any write-
downs, using the effective interest method. A write-
down is taken when objective indications suggest that
the receivable may not be fully collectible. Such an
indication might be the insolvency or other consider-
able financial problems of the debtor, for example. The
amount of the write-down is measured as the differ-
ence between the carrying amount of the receivable
and the present value of the estimated future cash
flows from this receivable, discounted by application of
the effective interest rate. Write-downs are charged
against income both in the form of an account for
allowances on doubtful accounts and by means of
direct write-downs. The account for allowances on
doubtful accounts is used, in particular, for allowances
on doubtful trade receivables and receivables due from
related parties. If in subsequent periods the fair value
has objectively risen, the write-downs are reversed and
recognized in income in the appropriate amounts.
Cash and cash equivalents
The cash and cash equivalents consist of cash (short-
term available cash in banks, cash on hand, and
checks). These items are measured at amortized cost.
Financial derivatives
Financial derivatives are utilized exclusively to hedge
against currency and interest rate risks that have an
influence on future cash flows. They are measured at
fair values based on stock exchange or market prices,
or using generally accepted valuation methods. If the
conditions for the application of hedge accounting are
met, the effective portion of the fair value changes,
including the tax effects, is recognized directly in equity
as accumulated other comprehensive income. Any
ineffective portions are recognized immediately in
income. The amounts recognized in accumulated
other comprehensive income are recycled when the
underlying transaction is recognized on the balance
sheet or income statement. The changes in the fair
value of derivatives that do not meet the conditions for
134 Annual Report 2011 Axel Springer AG
the application of hedge accounting, despite their
economic hedging effect, are measured at fair value
through profit and loss. Furthermore, financial deriva-
tives are used to cover the risk of impairments of in-
vestments and securities. When the underlying finan-
cial assets are recognized at amortized costs because
their fair values are not reliably measurable, the finan-
cial derivative is recognized at amortized costs as well.
Contingent consideration
Options and earn-out agreements in connection with
business combinations and acquisition of non-
controlling interests are treated as contingent consi-
deration at fair value. This value depends significantly
on the profit trends of the acquired companies in the
years prior to the possible exercise dates of the op-
tions or the payment dates of the earn-outs.
For transactions that were completed prior to January
1, 2010, the obligation was measured at the present
value of the expected cash flows provided that utiliza-
tion was probable and the obligation could be meas-
ured reliably. Adjustments in the subsequent periods
are recorded with no effect on income. Options and
earn-out agreements in connection with business
combinations completed since January 1, 2010, are
measured at the present value of the expected cash
flows, provided that it can be measured reliably. In
the subsequent periods, changes in the fair value are
recognized immediately in income. The discount rates
are determined on the basis of the interest rates
charged on the Group’s borrowings.
Other financial liabilities
Other non-derivative financial liabilities are measured at
amortized cost by application of the effective interest
method.
(h) Inventories
Inventories are measured at cost. Purchase costs are
determined on the basis of a weighted average value.
Production costs include all costs directly related to
the units of production and production-related over-
head costs. Inventories are measured at the reporting
date at the lower of the purchase or production cost
and the net realizable value. The net realizable value
is the estimated selling price less estimated costs to
be incurred until the sale. The net realizable value of
goods and services in progress is calculated as the
net realizable value of finished goods and services
less remaining costs of completion. Impairments are
reversed whenever the reasons justifying an earlier
write-down no longer exist.
(i) Assets held for sale
Assets are classified as held-for-sale when their dis-
posal has been initiated. The non-current assets held
for sale are measured at the lower of the carrying
amount or the fair value less costs to sell. Depreciation
is no longer applied to these assets.
Consolidated Financial Statements 135
Notes to the Consolidated Financial Statements
(j) Pension provisions
The provisions for pension obligations under defined
benefit plans are calculated using the projected unit
credit method under which future changes in compen-
sation and benefits are taken into account. The follow-
ing parameters were applied in the 2011 and 2010
fiscal years:
Information in %
Discount rate
2011
2010
2.25 – 5.0 2.75 – 4.75
Expected return on plan assets
3.5 – 5.0
Expected return on reimbursement
rights
5.0
3.5
4.6
Salary trend
Pension trend
1.0 – 1.75
1.5 – 1.75
0.25 – 1.75 0.25 – 1.75
The expected life spans are determined with reference
to the country-specific recognized actuarial tables. The
present value of the defined benefit obligation is de-
termined by discounting the estimated future cash
outflows. The discount rate applied for this purpose is
determined with reference to high-quality corporate
bonds that match the underlying pension obligations
with respect to currency and maturity.
Actuarial gains and losses resulting from changes in
actuarial parameters are immediately offset against
accumulated other comprehensive income without
affecting net income.
(k) Other provisions and accrued liabilities
Other provisions have been formed to account for all
discernible legal and constructive obligations to third
parties, provided that the settlement of the obligation
is probable and the amount of the obligation can be
reliably estimated. The amount of each provision cor-
responds to the expected settlement amount. In the
case of long-term provisions, the expected settlement
amount is discounted to the present value at the re-
porting date by application of appropriate market rates
of interest. Provisions are recognized for restructuring
expenses only when the intended measures have been
sufficiently concretized and announced on or before
the reporting date.
(l) Deferred taxes
Deferred taxes are recognized to account for the future
tax effects of temporary differences between the tax
bases of assets and liabilities and the carrying amounts
of those assets and liabilities in the consolidated finan-
cial statements, and for interest and tax loss carry-
forwards. Deferred taxes are measured on the basis of
the tax laws already enacted for those fiscal years in
which it is probable that the differences will reverse or
the tax loss carry-forwards can be utilized. Deferred
tax assets are recognized for temporary differences or
interest and tax loss carry-forwards only when the
ability to utilize them in the near future appears to be
reasonably certain. Deferred taxes are recognized for
temporary differences resulting from the fair value
measurement of assets and liabilities obtained through
business combinations. Deferred taxes are recognized
for temporary differences relating to goodwill only
when the goodwill can be utilized for tax purposes.
Deferred tax assets and liabilities of tax groups are
netted if they are based on the same kind of income
taxes; otherwise, they are netted only if the deferred
taxes are based on the income taxes imposed by the
same tax authority and only when current taxes can be
netted as well.
136 Annual Report 2011 Axel Springer AG
(m) Treasury shares
Treasury shares are measured at cost and are charged
directly to equity. The treasury shares are presented in
a separate line item of the consolidated statement of
changes in equity.
(n) Share-based payment programs
As part of performance-based remuneration programs,
Axel Springer Group grants equity-settled and cash-
settled share-based payment programs. The compen-
sation components to be recognized as expenses over
the vesting period are measured as the fair value of the
options at the time when they were granted (in case of
equity-settled programs) or at the reporting date (in
case of cash-settled programs). The fair values are
determined on the basis of generally accepted option
pricing models. The corresponding amount is recog-
nized in the additional paid-in capital (in the case of
equity-settled programs) or as provisions/liabilities (in
the case of cash-settled programs). Additions to liabili-
ties/provisions are recorded to personnel expenses;
reversals are accounted for in other operating income.
(o) Transactions in foreign currencies
Purchases and sales in foreign currencies are translat-
ed at the exchange rate on the date of the transaction.
Assets and liabilities in foreign currencies are translated
into the functional currency at the exchange rate on
the reporting date. Any foreign exchange gains or
losses resulting from such translations are recognized
in income.
(p) Use of estimates
The preparation of the consolidated financial state-
ments requires estimates and assumptions that have
an influence on the presentation of assets and liabilities,
the disclosure of contingent liabilities at the reporting
date, and the presentation of income and expenses.
Significant estimates and assumptions relate in par-
ticular to allowances for doubtful receivables, the
measurement of pension provisions and plan assets,
product return rates, medium-term planning, discount
rates and growth rates for the valuation of goodwill and
intangible assets with indefinite useful life, contingent
consideration for options and earn-out agreements in
connection with business combinations and acquisition
of non-controlling interests, assets and liabilities from
finance leases, and the ability to utilize deferred tax
assets in the future. Information concerning the carry-
ing amounts determined with the use of estimates can
be found in the comments on the specific line items.
(q) New accounting standards
No material changes resulted in fiscal year 2011 for
Axel Springer from IFRS standards or IFRIC interpre-
tations to be applied for the first time.
The following IFRSs have already been published, but
not yet applied.
IFRS 9 “Financial Instruments” was published by IASB
in November 2009. In the future, financial assets must
be assigned only to the two valuation categories “at
amortized cost” and “at fair value” and measured
accordingly. The regulations for recognizing financial
liabilities were published as a supplement in October
2010 and led to changes in the application of the fair
value option. Due to an amendment published in
December 2011, IFRS 9 is only required to be applied
to fiscal years beginning on or after January 1, 2015.
These amendments have not yet been incorporated
into European law. The application of the new stand-
ard will lead to changes in the presentation and recog-
nition of financial assets and liabilities.
In May 2011, the IASB published three new and two
revised standards, IFRS 10 “Consolidated Financial
Statements”, IFRS 11 “Joint Arrangements”, IFRS 12
“Disclosure of Interests in Other Entities”, amendments
to IAS 27 “Consolidated and Separate Financial
Statements”, and amendments to IAS 28 "Investments
in Associates”. IFRS 10 supersedes the previous regu-
lations on consolidated financial statements (parts of
IAS 27 “Consolidated and Separate Financial State-
ments”) and special purpose entities (SIC-12 “Consoli-
dation – Special Purpose Entities”) and pre-scribes the
control model as a uniform principle for the future. The
standard additionally includes guidelines for assessing
control in cases of doubt. The currently applicable
regulations for recognizing shares in joint ventures
Consolidated Financial Statements 137
Notes to the Consolidated Financial Statements
(IAS 31 “Interests in Joint Ventures” and SIC-13 “Joint-
ly Controlled Entities – Non-Monetary Contributions by
Venturers”) will be replaced by IFRS 11 in the future.
The disclosure obligations previously included in IAS
27, IAS 28, and IAS 31 are combined into IFRS 12 and
expanded with additional particulars. Due to these
amendments, IAS 27 only still contains regulations on
the recognition of shares in subsidiaries, affiliates, and
joint ventures in the separate financial statements of
the parent company. IAS 28 is being expanded to
include regulations on the recognition of shares in joint
ventures and prescribes the use of the equity method
for affiliates and joint ventures. These changes are
required to be applied to fiscal years that begin on or
after January 1, 2013. These amendments have not
yet been incorporated into European law. We assume
that the new and revised standards will have no mate-
rial influence on our financial position, liquidity, and
financial performance.
IFRS 13 “Fair Value Measurement”, which was also
published in May 2011, introduces a comprehensive
framework for measuring the fair value. IFRS 13 is
required to be applied to fiscal years that begin on or
after January 1, 2013. These amendments have not
yet been incorporated into European law. The stan-
dard will have no material influence on our financial
position, liquidity, and financial performance.
In June 2011, the IASB published “Changes to IAS 1 –
Presentation of Financial Statements”. The option to
present the income statement and the other in-
come/loss either in a continuous presentation or alter-
natively in two subsequent presentations is fundamen-
tally preserved. In the future, however, the items of the
other result must be grouped in such a way that a
separate presentation is created showing whether or
not these items will have to be reclassified later into the
income statement. The related income tax items must
be assigned accordingly. These changes are required
to be applied to fiscal years that begin on or after July
1, 2012. These amendments have not yet been incor-
porated into European law. The application of the
amended standard will lead to changes in the presen-
tation of the statement of comprehensive income.
“Changes to IAS 19 – Employee Benefits” was pub-
lished in June 2011. These changes lead to abolition of
the corridor method and require the recognition of the
actuarial gains and losses directly in other comprehen-
sive income. In addition, the discount rate used for the
obligation has to be used as expected return on plan
assets, as well. In the future, the past service cost
must be recognized entirely in the period of the plan
change. The revised standard changes the rules for
termination benefits and expands the disclosure obli-
gations. These changes are required to be applied
to fiscal years that begin on or after January 1, 2013.
These amendments have not yet been incorporated
into European law. The changes will not have a
significant influence on our financial position, liquidity,
and financial performance.
In the reporting year, IASB and IFRS IC published
additional pronouncements that had or will have
no material influence on our consolidated financial
statements.
138 Annual Report 2011 Axel Springer AG
Notes to the consolidated statement of financial position
(4) Intangible assets
The changes in intangible assets were as follows:
€ millions
Acquisition or production cost
Balance as of January 1, 2010
Initial consolidation
Deconsolidation
Currency effects
Additions
Disposals
Transfers
Balance as of December 31, 2010
Initial consolidation
Deconsolidation
Currency effects
Additions
Disposals
Transfers
Balance as of December 31, 2011
Depreciation and impairments
Balance as of January 1, 2010
Initial consolidation
Deconsolidation
Currency effects
Additions
Disposals
Transfers
Balance as of December 31, 2010
Deconsolidation
Currency effects
Additions
Disposals
Transfers
Balance as of December 31, 2011
Carrying amounts
As of December 31, 2011
As of December 31, 2010
Purchased
rights and
licenses
Internally
generated
rights
Goodwill
Total
499.2
223.7
– 56.2
27.9
27.5
– 10.1
– 0.2
711.7
291.0
– 0.1
– 0.8
38.4
– 12.9
– 0.3
1,027.1
144.5
0.5
– 11.3
3.8
45.0
– 7.5
– 0.1
174.9
– 0.1
– 0.6
63.1
– 9.7
0.1
227.6
799.5
536.8
39.8
0.9
– 4.8
1.5
1.7
– 4.1
– 0.4
34.5
6.6
0.0
0.0
7.9
– 1.2
0.1
47.8
18.0
0.0
– 1.0
0.2
6.0
– 1.7
0.0
21.6
0.0
0.0
5.7
– 0.3
0.0
26.9
20.9
12.9
507.3
109.3
– 15.1
11.7
0.3
0.0
0.5
614.0
529.2
0.0
– 1.0
1.7
0.0
– 0.7
1,046.2
334.0
– 76.1
41.1
29.5
– 14.2
– 0.2
1,360.1
826.8
– 0.1
– 1.7
48.0
– 14.1
– 0.9
1,143.1
2,218.0
48.2
0.0
0.0
0.0
0.0
0.0
0.0
210.8
0.5
– 12.4
4.0
51.1
– 9.2
– 0.1
48.2
244.6
0.0
0.0
7.8
0.0
– 0.7
55.3
– 0.1
– 0.7
76.5
– 10.0
– 0.6
309.8
1,087.8
565.8
1,908.1
1,115.6
Consolidated Financial Statements 139
Notes to the Consolidated Financial Statements
The purchased rights and licenses mainly comprised
title rights, trademarks, and customer relationships.
The internally generated intangible assets mainly
consisted of software solutions and websites.
With the exception of the SeLoger reporting unit, the
total of goodwill and intangible assets with indefinite
useful lives that have been assigned to the individual
reporting units amounted to less than 16 % of the total
value of all goodwill and intangible assets with indefi-
nite useful lives measured at December 31, 2011, in
the amount of € 1,570.2 million (PY: € 895.8 million).
The value in use of the reporting units is determined
primarily by the terminal value. The amount of the
terminal value depends on the forecasted cash flow in
the fifth year of medium-term planning, on the growth
rate of the cash flows subsequent to the medium-term
planning, and on the discount rate (see explanations in
note (3f) on assumptions in the context of the annual
impairment test).
Goodwill amounting to € 464.0 million and intangible
assets with indefinite useful lives amounting to
€ 128.3 million, representing approximately 38 % of
the total value, were assigned to the SeLoger reporting
unit in the Digital Media segment for the first time in
the reporting year. A reduction of cash flows by about
45 % in the fifth planning year would reduce the surplus
between the value in use and the carrying amount of
this reporting unit to zero. A reduction in the growth
rate by 0.5 percentage points would reduce the surplus
by 21.2 %, and an increase in the discount rate by
0.5 percentage points would reduce the surplus by 25.6 %.
Goodwill amounting to € 349.5 million (PY:
€ 344.8 million) and intangible assets with indefinite
useful lives amounting to € 116.6 million (PY:
€ 116.4 million), representing approximately 30 % (PY:
50 %) of the total value, were assigned to a total of four
additional reporting units in the Digital Media segment.
A reduction of cash flows by about 90 % (PY: 80 %) in
the fifth planning year would reduce the surplus bet-
ween the value in use and the carrying amount of
these reporting units to zero. A reduction in the growth
rate by 0.5 percentage points would reduce the sur-
plus by 10.5 % (PY: 11.8 %), and an increase in the
discount rate by 0.5 percentage points would reduce
the surplus by 12.7 % (PY: 14.3 %).
Goodwill amounting to € 124.1 million (PY:
€ 130.0 million) and intangible assets with indefinite useful
lives amounting to € 208.8 million (PY: € 197.8 million),
representing approximately 21 % (PY: 35 %) of the total
value, were assigned to a total of two reporting units that
are almost completely assigned to the Print International
segment. A reduction of cash flows by about 60 % (PY:
70 %) in the fifth planning year would reduce the surplus
between the value in use and the carrying amount of
these reporting units to zero. A reduction in the growth
rate by 0.5 percentage points would reduce the surplus
by 14.9 % (PY: 12.8 %), and an increase in the discount
rate by 0.5 percentage points would reduce the surplus
by 18.1 % (PY: 15.6 %).
140 Annual Report 2011 Axel Springer AG
(5) Property, plant, and equipment
The changes in property, plant, and equipment were as follows:
€ millions
Acquisition or production cost
Balance as of January 1, 2010
Initial consolidation
Deconsolidation
Currency effects
Additions
Disposals
Transfers
Balance as of December 31, 2010
Initial consolidation
Currency effects
Additions
Disposals
Transfers
Balance as of December 31, 2011
Depreciation and impairments
Balance as of January 1, 2010
Initial consolidation
Deconsolidation
Currency effects
Additions
Disposals
Transfers
Balance as of December 31, 2010
Currency effects
Additions
Disposals
Transfers
Balance as of December 31, 2011
Carrying amounts
As of December 31, 2011
As of December 31, 2010
Land and buildings,
including buildings
on non-owned land
Technical
equipment
and
machinery
Other
equipment,
operational
and office
equipment
Construction
in progress
583.8
544.5
179.3
6.5
0.0
0.6
0.6
– 0.2
– 38.4
553.1
0.0
– 0.6
51.1
– 24.7
3.6
582.5
26.1
– 1.1
– 0.7
7.3
– 27.5
0.7
549.3
0.0
– 1.2
2.8
– 4.2
2.6
549.2
5.9
– 5.2
2.3
18.7
– 15.5
1.7
187.3
1.4
– 1.6
25.6
– 16.1
2.6
199.0
173.6
306.9
125.8
0.2
0.0
0.2
11.6
– 0.1
– 12.5
173.1
– 0.2
11.5
– 11.1
0.9
174.2
0.4
– 1.6
– 0.1
26.6
– 27.1
0.0
305.2
– 0.8
29.1
– 3.8
0.0
329.7
0.0
– 1.2
1.1
17.2
– 13.5
0.0
129.4
– 1.0
20.5
– 15.6
0.0
133.3
408.3
380.0
219.5
244.1
65.7
57.8
3.4
0.0
0.0
0.0
6.4
– 0.7
– 4.5
4.7
0.0
0.0
5.5
– 0.5
– 5.3
4.3
0.0
0.0
0.0
0.0
0.1
– 0.1
0.0
0.0
0.0
0.0
0.0
0.0
– 0.1
4.4
4.7
Total
1,311.0
38.6
– 6.3
2.2
33.1
– 43.8
– 40.4
1,294.3
1.4
– 3.4
84.9
– 45.5
3.4
1,335.0
606.3
0.6
– 2.7
1.3
55.5
– 40.8
– 12.5
607.7
– 2.0
61.0
– 30.5
0.9
637.1
697.9
686.7
Consolidated Financial Statements 141
Notes to the Consolidated Financial Statements
As of December 31, 2011 property, plant and equipment
with acquisition or production cost of € 145.6 million (PY:
€ 143.7 million) were in use that had already been fully
depreciated.
(6) Investment property
The development of our office and retails spaces in Berlin
and Hamburg leased to third parties was as follows:
Property, plant, and equipment in the amount of
€ 72.0 million (PY: € 91.9 million) had been pledged as
security for own liabilities as of December 31, 2011.
In the reporting year, real estate assets with a residual
carrying amount of € 13.6 million (property, plant, and
equipment) and € 3.7 million (investment property) were
contributed to the Axel Springer Pensionstreuhand e.V.
(see note 13 for further details). Under a finance lease
Axel Springer leased back the real estate. The lease
agreement has a fixed term of 20 years. The initial rent
amounts to € 1.4 million and will be adjusted in relation
to the change in average rent of comparable real estate
from 2013 onwards. Axel Springer will bear all ancillary
and operating costs. When the fair value of the real
estate is below € 20.0 million at the end of the lease
agreement, Axel Springer has to compensate for the
difference. Due to the continuing lease of a portion of the
building space to third parties we recorded assets of
€ 19.4 million as additions to property, plant, and
equipment and € 3.2 million as additions to investment
property. The corresponding liability was recognized in
financial liabilities.
The other additions to real estate and buildings result
particularly from the acquisition of the real estate at our
headquarter in Berlin.
€ millions
Acquisition or production cost
Balance as of January 1, 2010
Additions
Transfers
Balance as of December 31, 2010
Additions
Disposals
Transfers
Balance as of December 31, 2011
Depreciation and impairments
Balance as of January 1, 2010
Additions
Transfers
Balance as of December 31, 2010
Additions
Disposals
Transfers
Write-ups
Balance as of December 31, 2011
Carrying amounts
As of December 31, 2011
As of December 31, 2010
Investment
property
49.2
3.2
38.9
91.3
3.3
– 8.2
– 3.1
83.3
17.5
6.9
12.5
37.0
1.3
– 4.5
– 0.9
– 2.2
30.7
52.6
54.3
142 Annual Report 2011 Axel Springer AG
The changes resulting from contributing real estate
assets to Axel Springer Pensionstreuhand e.V. and
the subsequent lease back are presented in note 5.
The fair value of investment property as of December 31,
2011 amounted to € 52.6 million (PY: € 54.3 million).
The fair value calculation, which was performed by us,
was based on the application of the discounted cash
flow method, with reference to the estimated cash flows.
In calculating this value, a discount rate of 7.0 % (PY:
7.0 %) and a perpetuity capitalization rate of 6.0 % (PY:
6.0 %) was applied. As a result of the change in fair val-
ue, write-ups amounting to € 2.2 million (PY: impairment
losses of € 5.6 million) have been recognized in other
operating income in the Services/Holding segment.
Due to increased own usage of office space, we reclassi-
fied an amount of € 2.2 million from investment property
into property, plant, and equipment in the reporting year.
In 2011, rental income of € 5.1 million (PY: € 3.3 million)
was generated, with corresponding rental expenses of
€ 0.6 million (PY: € 0.8 million). Directly allocable ex-
penses of € 0.0 million (PY: € 0.1 million) were incurred
for non-rented space.
The future minimum lease payments from operating
lease contracts broke down as follows:
€ millions
Due in up to one year
Due in one to five years
Due in more than five years
Total
2011
2010
3.7
10.4
6.0
20.1
3.6
11.1
7.6
22.4
(7) Non-current financial assets
The non-current financial assets include the shares in
Do⁄an TV at € 352.0 million, unchanged from the prior
year. When determining the recoverable amount in the
context of the impairment test of our investment in
Do⁄an TV, we factored in both estimated future cash
flows and a number of contractually stipulated value-
securing mechanisms.
The carrying amounts of investments carried using the
equity method showed the following development:
€ millions
Carrying amount as of January 1
Attributable net income
Dividends
Changes recognized in other
comprehensive income
Impairment losses
Acquisitions
Disposals
Carrying amount as of December 31
2011
40.7
5.0
– 5.4
– 1.2
– 8.4
0.0
0.0
30.6
2010
59.7
3.2
– 3.9
– 9.5
– 21.6
14.2
– 1.3
40.7
For the first time, proportionate results with an amount of
€ – 10.1 million (PY: € 0.0 million) have not been recog-
nized in the income from investments in the current year,
as the corresponding carrying amount has been fully
depreciated in the previous period.
The impairment losses relate to our investment in INFOR
in the amount of € 8.1 million (PY: impairment of invest-
ment in Prinovis in the amount of € 21.4 million).
Consolidated Financial Statements 143
Notes to the Consolidated Financial Statements
The disposals in the prior year related to the sales of our
shares in Cora Verlag and ZertifikateJournal. The acquisi-
tions in the prior year related to the purchase of 27.02 %
of the shares in PNS in connection with the business
activities in the Czech Republic contributed to the joint
venture Ringier Axel Springer Media by Ringier.
The aggregated financial data for the investments ac-
counted for using the equity method are shown in the
table below. Net income and revenue amounts corre-
spond to the period of inclusion under the equity method
in the reporting periods:
€ millions
Net income
Revenues
Assets
Liabilities
2011
– 36.3
954.3
616.6
591.7
2010
25.4
886.1
692.8
595.5
(8) Inventories
The inventories broke down as follows:
€ millions
12/31/2011 12/31/2010
Raw materials and supplies
19.4
19.5
Semi-finished goods
Finished goods and merchandise
Inventories
2.8
6.3
3.0
4.6
28.6
27.0
Inventories of € 8.5 million (PY: € 8.7 million) were mea-
sured at their net realizable value. As of December 31,
2011, the valuation allowance for these inventories
amounted to € 1.9 million (PY: € 1.7 million), of which
€ 0.3 million (PY: € 1.6 million) was recognized affecting
net income in 2011.
(9) Trade receivables
The trade receivables broke down as follows:
€ millions
12/31/2011 12/31/2010
Trade receivables, nominal
Allowances for doubtful trade receivables
Trade receivables
455.5
– 13.1
442.4
398.9
– 13.0
385.9
The changes in the allowances for doubtful trade receiv-
ables are presented in the table below:
€ millions
Balance as of January 1
Utilization
Reversals
Disposal due to deconsolidation
Additions
Balance as of December 31
2011
2010
13.0
– 5.3
– 2.0
– 0.5
7.9
13.1
15.3
– 5.3
– 3.0
– 2.2
8.1
13.0
At December 31, 2011, receivables in the amount of
€ 288.7 million (PY: € 276.6 million) were neither past
due nor subject to valuation allowances. With regard
to these receivables, there were no indications at the
reporting date that would suggest that the customers
would not fulfill their payment obligations.
The past-due trade receivables at the reporting date for
which no valuation allowances have been charged are
presented in the table below.
€ millions
up to 30 days
31 to 90 days
91 to 180 days
181 to 360 days
361 days and longer
12/31/2011 12/31/2010
47.9
20.1
5.7
7.2
7.0
40.2
13.9
7.0
12.1
12.1
144 Annual Report 2011 Axel Springer AG
(10) Other assets
The other assets broke down as follows:
€ millions
12/31/2011 12/31/2010
Deferral of payment for regional
newspaper investments
Credit balances in accounts payable
Receivables due from employees
Derivatives
Receivables from Kirch insolvency
Other
Other financial assets
Advance payments
Receivables from other taxes
Other non-financial assets
125.0
150.0
7.2
0.5
0.4
0.0
15.1
0.6
2.4
6.8
24.3
29.7
157.5
204.6
17.1
10.0
27.1
12.0
10.6
22.6
Other assets
184.6
227.2
The purchase price from the sale of investments in regional
newspapers that occurred in 2009 will become succes-
sively due and payable in the period from 2011 to 2016.
A total of € 25.0 million was paid in fiscal year 2011.
Insofar as advance payments are announced in the
context of the insolvency proceedings against KirchMe-
dia GmbH & Co. KGaA i.L., we recognize them as re-
ceivables. The receivables accepted in the table of
claims by the insolvency administrator originally totaled
€ 325.0 million. In 2011 an amount of € 6.8 million was
settled by payment.
The miscellaneous financial assets include loans and
receivables due from other investee companies and
security deposits, among other items.
(11) Equity
The components and changes in consolidated equity are
summarized in the consolidated statement of changes in
equity.
(a) Subscribed capital
The share split at a 1:3 ratio adopted at the annual meet-
ing on April 14, 2011, was carried out in the reporting
year. The subscribed capital of € 98.9 million is fully paid
in. Based on the percentage of subscribed capital that
each share represents, the shares are valued at € 1.00
per share (PY: € 3.00 per share). The subscribed capital
is divided into 98,940 thousand (PY: 32,980 thousand)
registered shares, which can be transferred only with the
consent of the company. At the reporting date, 98,606
thousand shares were outstanding (PY: 98,340 thousand
shares considering the share split undertaken in 2011).
(b) Additional paid-in capital
The additional paid-in capital primarily results from a
shareholder contribution granted in previous years and
the amount of imputed compensation for the share-
based payment programs (see note (12)).
(c) Accumulated retained earnings
The accumulated retained earnings include the income
of the companies included in the consolidated financial
statements, to the extent that they have not been dis-
tributed to shareholders. Moreover, transactions with
shareholders are recognized.
In 2011, Axel Springer AG distributed an amount of
€ 157.3 million as dividend payments (€ 4.80 per qualify-
ing share) for the fiscal year 2010. In 2010, Axel Springer
AG distributed an amount of € 131.2 million as dividend
payments (€ 4.40 per qualifying share) for the fiscal year
2009. Based on the share split undertaken in 2011 this
corresponds to a dividend of € 1.60 (PY: € 1.47) per
qualifying share
The premium resulting from the re-issue of treasury
shares in the reporting period increased accumulated
retained earnings by € 4.5 million (see note 11(d)).
(d) Treasury shares
In the reporting year, 89 thousand treasury shares (after
the share split: 266 thousand treasury shares) were issued
by conversion of bonus claims in the context of a stock
participation program, and thus € 9.4 million was collected,
Consolidated Financial Statements 145
Notes to the Consolidated Financial Statements
increasing equity (of which € 4.5 million is allocated to the
premium recorded in accumulated retained earnings).
(12) Share-based payment
As of December 31, 2011, Axel Springer AG held
334 thousand treasury shares (PY: 600 thousand shares
considering the share split undertaken in 2011), corre-
sponding to 0.3 % (PY: 0.6 %) of its capital stock.
(e) Accumulated other comprehensive income
At the reporting date, accumulated other comprehensive
income contained effects from companies accounted for
using the equity method in the amount of € – 10.1 million
(PY: € – 10.1 million), actuarial gains/losses from
employer pension plans of € – 0.8 million (PY: losses
of € – 13.4 million) as well as a revaluation reserve of
€ – 3.1 million (PY: € – 3.1 million). The change results
primarily from the adjustment of the pension discount
rate for German pension plans to 5.0 % (PY: 4.6 %), as
well as from the revaluation of financial instruments.
In 2011, amounts recognized in the accumulated other
comprehensive income were not transferred to the con-
solidated income statement. In prior year, in connection
with the reduction of our investment in Do⁄an TV, foreign
exchange losses of € 16.7 million were transferred from
accumulated other comprehensive income to consoli-
dated net income.
(f) Non-controlling interests
The non-controlling interests mainly related to the follow-
ing companies:
€ millions
12/31/2011 12/31/2010
Ringier Axel Springer Media Group
179.7
166.3
ZANOX Group
Other companies
21.0
35.9
22.1
21.8
Non-controlling interests
236.6
210.2
The increase in the non-controlling interests in other
companies is due to the termination of a call-and-put-
option agreement for the acquisition of non-controlling
interests.
At the reporting date, two virtual stock option plans exist-
ed that were set up in July 2009 (hereinafter 2009 virtual
stock option plan) and October 2011 (hereinafter 2011
virtual stock option plan). The 2011 virtual stock option
plan comprises two tranches (hereinafter 2011a and
2011b). The material parameters of the virtual stock
option plans are shown below:
Virtual stock option plans
2009
2011a
2011b
Grant date
Term in years
07/01/2009 10/01/2011 10/01/2011
6
4
6
End of the term
06/30/2015 09/30/2015 09/30/2017
Qualifying period in years
4
2
4
End of qualifying period
06/30/2013 09/30/2013 09/30/2015
Option rights granted
1,125
thousands1)
473
473
thousands
thousands
Underlying
Maximum payment
Value at grant date
€ 20.291)
€ 40.571)
€ 4.221)
€ 30.00
€ 35.00
€ 60.00
€ 70.00
€ 2.74
€ 2.31
Total value at grant date
€ 4.7 million € 1.3 million € 1.1 million
1) Adjusted due to the share split undertaken in the reporting year.
If the working relationship of the right holder is terminat-
ed prior to the end of the individual qualifying period, but
after passage of one year after the grant of the option
rights, then the option rights become vested pro rata
temporis in proportion to the qualifying period (2009
virtual stock option plan) or at 50% (2011a virtual stock
option plan) or at 25% (2011b virtual stock option plan)
for each completed year of the qualifying period. An
additional requirement for vesting to occur is that, within
a period of one year prior to the end of the qualifying
period, during a period of 90 consecutive calendar days
(2009 virtual stock option plan) or three consecutive
calendar months (2011 virtual stock option plan), either
the price of the Axel Springer share is at least 30 % high-
er than the individual base value or the percentage by
which the price of the Axel Springer share averages
above the individual base value exceeds the average
percentage development of the DAX price index.
146 Annual Report 2011 Axel Springer AG
Exercise of the option rights is only possible if the aver-
age share price of Axel Springer AG in the 90 calendar
days (2009 virtual stock option plan) or three months
(2011 virtual stock option plan) prior to exercise is at
least 30 % above the base value and the percentage
price increase of the Axel Springer share exceeds the
development of the DAX price index in the corresponding
period. Each option grants a payment claim in the
amount of the growth in value of the Axel Springer share,
which corresponds to the difference between the volume-
weighted average price during the last 90 calendar days
prior to exercise and the base value. The maximum
payment claim is two times the base value.
The right holders are obligated to hold one share of Axel
Springer AG as their own investment for each ten options.
Disposal of these shares prior to exercise of the options
leads to a lapse of the options in the proportion of one
share for each ten options.
The value of the options was determined by application
of a Black-Scholes model in a Monte-Carlo simulation at
the grant date. The options will be remeasured at each
reporting date and recognized proportionally in accor-
dance with the projected vesting.
The development of the options, the resulting expenses
and income in the reporting year, and the balance of liabili-
ties and provisions at the reporting date are shown below:
Virtual stock option plans
In thousands
2009
2011a
2011b
Option rights as of January 1,
2011
Option rights granted
Expired option rights
1,1251)
0
– 84
0
473
0
0
473
0
Option rights as of December
31, 2011
1,041
473
473
€ millions
Income/expenses in 2011
Income/expenses in 2010
Liabilities/provisions as of
December 31, 2011
Liabilities/provisions as of
December 31, 2010
1.3
– 9.5
– 0.5
– 0.3
0.0
0.0
9.7
0.5
0.3
11.0
0.0
0.0
1) Adjusted due to the share split undertaken in the reporting year.
In May 2011, in the context of a stock participation pro-
gram, 89 thousand (after the share split: 266 thousand)
treasury shares were re-issued by conversion of Group
employee bonus claims at their fair value at the time of
issue in the amount of € 106.71 (after share split: € 35.57).
Personnel expenses of € 3.5 million were incurred by
granting increases of the amounts of deferred compensation.
Various free share and stock option programs existed at
our subsidiary SeLoger at the acquisition date. They
provide for exercise by the right holders in the years
2009 to 2013, linked with a subsequent holding period
of two years. The free shares and option rights, whose
weighted average exercise price lies at € 20.93, lapse in
the years 2017 to 2019. In the reporting period, the right
holders were offered call-and-put-option agreements to
transfer all shares from these programs (a maximum of
525 thousand) to Axel Springer against cash payment,
out of which 104 thousand have already been exercised
Consolidated Financial Statements 147
Notes to the Consolidated Financial Statements
and 15 thousand forfeited in the current year. The call
and put options are not linked to any market-related or
company-related or any other conditions and vest im-
mediately after the issuance of the shares to the employ-
ees. The purchase price upon exercise amounts to
€ 38.05 (squeeze-out price) multiplied by the ratio of the
volume-weighted 1-month-average rate of the Axel
Springer share on the last day of trading prior to exercise
of the options to the volume-weighted 1-month-average
rate of the Axel Springer share on the last trading day
before squeeze-out. Following the principle of substance
over form, the programs are treated by us as virtual
stock option programs granting a payment claim in the
amount of the difference between the exercise price and
the purchase price. Measurement is based on the Black-
Scholes model or the current share price, considering
future dividends. The options will be remeasured at each
reporting date and recognized proportionally in accord-
ance with the projected vesting. At the grant date, the
weighted average fair value was € 28.83 per option right
or a total of € 15.1 million.
As of December 31, 2011, an obligation of € 8.8 million
was accounted for. In the 2011 reporting period,
€ 3.0 million was recognized as personnel expense and
€ 0.6 million as other operating income.
auFeminin.com S.A. granted its senior executives sub-
scription rights for free shares and stock options. These
share-based payments must be settled with shares of
auFeminin.com S.A.
In November 2010, 300 thousand warrants for acquisi-
tion of one share of auFeminin.com S.A. each with an
exercise price of € 17.15 were issued to senior employ-
ees. These options vested upon expiration of the first
(50 %) and second (50 %) years after the grant date,
insofar as the earnings target established for the indivi-
dual tranche (EBITDA 2010 or EBITDA 2011) was
achieved. Once they have vested, the options can be
exercised for a total of five (50 %) or four (50 %) years.
In June 2009, 300 thousand warrants for acquisition of
one share of auFeminin.com S.A. each with an exercise
price of € 8.94 were issued to senior employees. These
options vested upon expiration of the first (50 %) and
second (50 %) years after the grant date, insofar as the
earnings target established for the individual tranche
(EBITDA 2009 or EBITDA 2010) was achieved. Once
they have vested, the options can be exercised for a
total of five (50 %) or four (50 %) years.
99 thousand stock options granted in April 2008, each
one entitling the holder to purchase one share of auFem-
inin.com S.A. (exercise price: € 20.46), as well as the 74
thousand stock options that had already been granted at
the date of acquisition of auFeminin.com S.A. in July
2007 (exercise price: € 18.60 or € 21.21), will become
vested in equal annual installments over a period of four
years. The option grant is not conditioned on any further
earnings or market conditions. These options can be
exercised for the first time at the end of the fourth year
after the options were granted and for a total of four
years thereafter.
The fair values of the stock options granted in the prior
year were determined by application of the Black-Scholes
model at the grant date. For this purpose, the following
parameters were applied:
Share price at the grant date in €
Exercise price in €
Options Nov. 2010
16.30
17.15
Interest rate for risk-free investments, in %
0.97 resp. 1.08
Expected term until fully vested in years
1 resp. 2
Expected term of the options in years
Expected volatility, in %
Expected dividend yield, in %
6
45.00
0.00
Fair value at grant date, in €
2.63 resp. 3.90
148 Annual Report 2011 Axel Springer AG
The expected volatility was determined based on histori-
cal volatility rates using a period corresponding to the
term of the options.
The number of options and the weighted average exer-
cise price developed as follows:
2011
2010
Options in
thousands
Exercise
price1) in €
Options in
thousands
Exercise
price1) in €
Balance as
of January 1
Lapse
Issuance
Exercise
Balance as of
December 31
Thereof
exercisable
640
– 63
0
– 2
15.21
16.90
–
8.94
473
– 133
300
0
12.92
11.42
17.15
–
576
15.05
640
15.21
233
11.03
158
13.52
1) weighted average exercise price
The weighted average stock price at the date of exercise
of the options in 2011 was € 18.17.
The exercise prices for the options outstanding on the
reporting date remained unchanged from the prior year
between € 8.94 and € 21.21. The weighted average
remaining term of these options was 3.9 years (PY:
4.9 years).
A total of 53 thousand rights to purchase free shares that
were granted in April 2008, as well as 37 thousand rights
to purchase free shares that had already been granted at
the date of acquisition of auFeminin.com S.A. in July
2007, will be transferred to the plan participants after a
period of two years after the grant date, provided that
certain operating targets (particularly EBIT and revenue
targets), and in some cases also market goals (audience
group quotas), have been achieved, provided that the
participants are still employed with the company and
provided that the free shares have not expired. The
holding period after the transfer of shares is an additional
two years.
In the reporting year, 18 thousand (PY: 32 thousand)
rights to purchase free shares were exercised. The stock
price at the exercise date was € 17.55 (PY: € 10.91). At
the reporting date, a total of 0 (PY: 18 thousand) rights
to purchase free shares were outstanding. The weighted
average remaining term of these rights in the prior year
was 0.9 years.
The compensation expenses for the share-based pay-
ment programs of auFeminin.com S.A. recorded in per-
sonnel expense amounted to € 0.4 million in fiscal year
2011 (PY: € 0.3 million). The additional paid-in capital
was increased by the same amount.
(13) Pension obligations
Under its defined contribution pension plans, the Group
mainly contributes to public-sector pension insurance
carriers by virtue of the applicable laws. The current
contribution payments are presented as social security
costs within personnel expenses and amount to
€ 41.9 million (PY: € 41.4 million).
Provisions for pensions were created to account for the
obligations arising from vested pension rights and cur-
rent benefits for former and active employees of the Axel
Springer Group and their survivors. The different pension
plans within the Group are organized in accordance with
the legal, tax-related, and economic conditions of each
country. The provision for defined benefit plans corres-
ponds to the present value of the obligations at the
reporting date net of the fair value of the plan assets.
The amount of the provision was calculated as follows:
€ millions
12/31/2011 12/31/2010
Present value of defined benefit
obligations financed by fund
424.6
98.7
Fair value of plan assets
– 141.2
– 87.2
Present value of defined benefit
obligations not financed by fund
Provision
Reimbursement right
Net obligation
43.1
326.5
– 27.2
299.2
377.9
389.4
– 29.4
360.0
Consolidated Financial Statements 149
Notes to the Consolidated Financial Statements
The fair value of the plan assets showed the following
changes:
€ millions
Plan assets as of January 1
Expected income from plan assets
Employee contribution
Employer contribution
Benefits paid
Actuarial losses
Transfer of plan assets
Exchange rate changes
2011
87.2
3.4
2.0
2.4
– 5.2
– 0.9
50.3
1.9
2010
72.1
2.9
1.6
2.0
– 5.2
– 0.8
0.5
14.0
87.2
In order to secure and service existing pension obligations
of Axel Springer, we founded the Axel Springer Pensions-
treuhand e.V., Berlin, which is to be successively provid-
ed with earmarked assets. Effective September 1, 2011,
the real estate assets previously held by the fully-
consolidated special-purpose entity Axel-Springer-
Immobilien-Fonds-I Dr. Rühl & Co. KG, Düsseldorf, were
contributed with a fair value of € 24.3 million to this asso-
ciation, which is managing the assets in trust. In addition,
we contributed € 25.2 million in cash to the association in
2011. Thus pension obligations amounting to € 321.3 million
were shown as fund-financed for the first time.
The changes in the present value of the pension obliga-
tions are presented in the table below:
Plan assets as of December 31
141.2
€ millions
Obligation as of January 1
Current service cost
Interest expense
Actuarial gains/losses
Payments by employees
Transfer of pension obligation
Exchange rate change
Payments to retirees
Past service cost
2011
476.6
6.9
19.7
– 19.8
5.4
0.8
2.4
2010 1)
431.5
6.0
21.0
21.4
4.9
0.3
15.6
– 25.0
– 24.1
0.7
0.0
Obligation as of December 31
467.7
476.6
1) Prior-year figures adjusted due to a change in allocation.
In fiscal year 2012, contributions to fund-financed de-
fined benefit plans are expected to total € 58.8 million
(PY: € 2.4 million).
The plan assets include the cash and real estate assets
contributed to Axel Springer Pensionstreuhand e.V. in
the reporting year as well as claims against an insurance
company.
The investment strategy is based on specific investment
guidelines or specific legal requirements, which are in line
with our investment policy. The expected long-term
income from plan assets is derived from the expected
income of the asset classes within the portfolios and is
based on a value-securing investment strategy mainly
investing in obligations of issuers with high credit ratings,
and real estate. The investment portfolio broke down as
follows:
Bonds
Shares
Real Estate
Others
Total
12/31/2011 12/31/2010
48.3%
74.9%
1.0%
1.9%
28.6%
17.7%
22.1%
5.5%
100.0%
100.0%
150 Annual Report 2011 Axel Springer AG
The fair value of the plan assets includes real estate used
by the company itself in the amount of € 20.8 million (PY:
€ 0 million).
The expenses for defined benefit pension plans broke
down as follows:
Axel Springer AG is entitled to reimbursement of pension
obligations or pension expenses arising in connection
with them in the context of the contribution of rotogra-
vure printing operations to PRINOVIS Ltd. & Co. KG,
Hamburg, in 2005. The reimbursement right is presented
as a separate asset (see note (36)), whereas in the in-
come statement, the income from the reimbursement is
netted with the corresponding pension expenses. The
value of the reimbursement claim was € 27.2 million in
the reporting year (PY: € 29.4 million). The changes in
the reporting period consisted of compounding effects
of € 1.3 million (PY: € 1.5 million), actuarial losses of
€ 1.0 million (PY: gains of € 0.9 million), and reimburse-
ment of pension payments of € 2.5 million (PY:
€ 2.5 million).
€ millions
Current service cost
Interest expense
Expected income from plan assets
Expected income from reimbursement
rights
Past service cost
Pension expenses
Actual income from plan assets
Actual income from reimbursement rights
1) Prior-year figures adjusted due to a change in allocation.
2011
6.9
19.7
– 3.4
– 1.3
0.7
22.7
2.6
0.3
2010 1)
6.0
21.0
– 2.9
– 1.5
0.0
22.6
2.2
2.4
Service cost is presented within the personnel expenses.
The interest portion contained in the pension expenses
and the expected income from the plan assets and re-
imbursement right are presented as components of
interest expenses.
At the reporting date, actuarial losses before factoring in
tax effects amounting to € 0.9 million (PY: € 18.8 million)
were accounted for in accumulated other comprehensive
income.
The amounts of the current and the prior four reporting
periods for the present value of the obligations, the fair
value of plan assets, and the experienced-based adjust-
ments to plan assets and liabilities are summarized in the
table below:
€ millions
12/31/2011 12/31/2010 12/31/2009 12/31/2008 12/31/2007
Present value of defined benefit obligations financed by fund
Fair value of plan assets
424.6
141.2
98.7
87.2
80.2
72.1
83.6
76.2
71.4
66.1
Present value of defined benefit obligations not financed by fund
43.1
377.9
351.3
336.1
336.2
Experience-based adjustments to plan liabilities
Experience-based adjustments to plan assets
– 0.1
– 0.9
– 3.1
– 0.8
– 3.9
– 0.5
2.8
0.0
1.8
0.0
Consolidated Financial Statements 151
Notes to the Consolidated Financial Statements
(14) Other provisions and accrued liabilities
The other provisions and accrued liabilities broke down as follows:
Balance as of
01/01/2011
Utilization
Reversals
Additions
Other
changes
Balance as of
12/31/2011
€ millions
Other obligations towards employees
Partial early retirement program (Altersteilzeit)
Returns
Structural measures
Litigation expenses
Discounts and rebates
Dismantling obligations
Other taxes
Other
Other provisions
53.8
36.0
27.4
35.9
8.2
6.5
4.2
5.9
16.1
194.0
Other obligations towards employees primarily included
variable compensation tied to performance and loyalty
bonuses. Provisions for structural measures were mainly
allocated to the segments Newspapers National and
Services/Holding. Provisions for returns comprise the
expected sales returns of publishing products. The mis-
cellaneous provisions account for anticipated losses on
rental agreements, contributions, and custody/archiving
obligations, among others.
The other changes resulted from the initial consolidation
of acquired companies, currency translation differences
and compound interest.
Non-current provisions are primarily contained in the
provisions for partial early retirement programs (Alters-
teilzeit), dismantling obligations, and structural measures.
Payments are expected to occur predominantly within
the next five years.
45.3
12.0
26.4
17.6
0.5
4.1
0.1
3.3
7.9
1.5
0.1
0.3
9.2
1.0
0.5
0.4
0.0
0.9
60.8
8.2
26.4
7.5
1.3
4.6
0.3
1.5
7.4
117.3
13.8
118.0
(15) Financial liabilities
0.6
1.4
0.0
0.0
0.0
0.0
0.3
0.0
1.2
3.6
68.4
33.6
27.0
16.6
8.0
6.5
4.3
4.1
15.9
184.5
The financial liabilities comprise liabilities due to banks
amounting to € 693.9 million (PY: € 355.5 million) and
finance leases amounting to € 23.0 million (PY:
€ 0.8 million).
The liabilities due to banks were characterized by utiliza-
tion, interest rates, and maturities set forth in the table
below. All liabilities were denominated in euros. Short-
term loans are not presented in the table.
2011 €
millions
2010 €
millions
Interest rate in %
Maturity
635.0
275.0
3-month EURIBOR + 0.15 08/14/2013
29.9
10.3
9.7
5.3
0.0
32.5
11.8
10.4
5.64 10/31/2012
5.65 03/31/2012
5.09 11/30/2013
5.8
3-month EURIBOR + 0.30 10/15/2022
15.6
4.63 07/31/2011
The interest rates were mainly equivalent to the effective
rates of interest. In the case of fixed-interest loans, the
interest rates are fixed until the maturity date.
152 Annual Report 2011 Axel Springer AG
Furthermore, at the reporting date additional unused
short-term and long-term credit facilities amounted to
€ 885 million (PY: € 1,245 million).
(16) Other liabilities
The other liabilities broke down as follows:
We recognized a liability of € 22.6 million in financial
liabilities due to Axel Springer AG leasing the building
space contributed to Axel Springer Pensionstreuhand
e. V., Berlin, in the reporting year in the context of a
finance lease (see note (5)). The carrying amount of the
assets held in the context of finance leases as of De-
cember 31, 2011 amounts to € 23.1 million (PY:
€ 1.0 million).
The future minimum lease payments arising from finance
leases can be reconciled to their cash value as of
December 31, 2011 as follows:
€ millions
Due in up to one year
Due in one to five years
Due in more than five
years
Total
Minimum
lease
payments
Interest
portion
Present
value
1.7
5.9
40.8
48.4
1.4
5.4
18.7
25.4
0.3
0.5
22.2
23.0
€ millions
12/31/2011 12/31/2010
Contingent consideration from business
combinations
Debit balances in accounts receivable
Liabilities due to employees
Liabilities from derivatives
Other
88.2
19.7
17.6
14.0
36.9
87.1
26.4
14.9
20.0
18.8
Other financial liabilities
176.4
167.1
Prepaid subscriptions
Liabilities from other taxes
Accrued liabilities
Advance payments
Capital investment subsidies
Liabilities due to social insurance carriers
Liabilities for duties and contributions
Other
Other non-financial liabilities
Other liabilities
85.4
33.4
22.9
21.7
20.9
7.9
6.7
52.9
252.0
428.3
80.6
29.0
22.3
19.2
16.0
4.9
8.9
33.4
214.4
381.5
The reconciliation as of December 31, 2010 breaks
down as follows:
€ millions
Due in up to one year
Due in one to five years
Total
Minimum
lease
payments
Interest
portion
Present
value
0.3
0.5
0.8
0.0
0.0
0.1
0.3
0.5
0.8
At the reporting date, we expect future cash provided by
subleasing of € 2.0 million (PY: € 0.0 million).
The increase in other liabilities primarily derived from the
initial consolidation of acquired companies.
Acquisition-related liabilities consisted of contingent
liabilities resulting from put options in respect of business
combinations.
Liabilities due to employees related to outstanding wage
and salary payments, management bonuses, and sever-
ance award claims.
Accrued liabilities contain liabilities resulting from over-
time and unused vacation.
Consolidated Financial Statements 153
Notes to the Consolidated Financial Statements
(17) Maturity analysis of financial liabilities
The contractually agreed (undiscounted) payments re-
lated to financial liabilities are presented in the following
table:
€ millions
Financial liabilities
Contingent consideration from business combinations
Other non-derivative financial liabilities
Derivative financial liabilities designated as a hedging instrument
€ millions
Financial liabilities
Contingent consideration from business combinations
Other non-derivative financial liabilities
Derivative financial liabilities designated as a hedging instrument
Carrying
amount as of
12/31/2011
716.9
88.2
363.3
14.8
Carrying
amount as of
12/31/2010
356.2
87.1
327.8
20.0
Undiscounted cash outflows
2012
2013– 2016
2017 ff.
50.4
0.8
351.6
8.7
648.9
79.0
7.5
6.0
5.2
15.8
4.2
0.1
Undiscounted cash outflows
2011
2012– 2015
2016 ff.
33.1
4.3
319.6
7.4
337.1
78.5
7.3
12.4
3.5
15.8
0.9
0.1
Notes to the consolidated statement of
comprehensive income
(18) Revenues
The revenues broke down as follows:
The revenues from barter transactions amounted to
€ 57.0 million in 2011 (PY: € 52.8 million). These
revenues were generated mainly from the bartering
of advertising services.
The increase year-on-year resulted particularly from the
initial consolidation of acquired companies.
€ millions
Advertising revenues
Circulation revenues
Printing revenues
Other revenues
Revenues
2011
2010
1,606.8
1,384.8
1,204.5
1,174.3
57.6
50.4
316.0
284.4
3,184.9
2,893.9
154 Annual Report 2011 Axel Springer AG
(19) Other operating income
The other operating income broke down as follows:
€ millions
Foreign exchange gains
Income from reversal of provisions
Income from reversal of allowances
Miscellaneous operating income
Other operating income
2011
2010
13.9
13.8
2.2
43.4
73.3
11.7
11.5
0.0
126.9
150.1
The remaining amount in miscellaneous other operating
income included a large number of circumstances with
immaterial amounts. In the prior year, the miscellaneous
other operating income mainly included the income on
the disposal (excluding related expenses) of the business
unit Solutions of StepStone Group (€ 73.7 million).
The increase year-on-year primarily resulted from the
initial consolidation of acquired companies, increased
paper costs, and the improved business in the area of
performance-based marketing.
(21) Personnel expenses
The personnel expenses broke down as follows:
€ millions
Wages and salaries
Social security
Retirement benfits
Expenses for share-based payments
Other benefit expenses
Personnel expenses
2011
728.9
105.4
8.8
5.0
3.4
2010
681.9
90.7
7.5
9.9
2.9
851.6
792.9
(20) Purchased goods and services
The average number of employees in the Group is
shown below:
The purchased goods and services broke down as follows:
€ millions
Raw materials and supplies and
purchased merchandise
Purchased services
Purchased goods and services
2011
2010
Editors
Salaried employees
Wage-earning employees
265.1
790.6
1,055.7
253.8
696.8
950.6
2011
8,216
3,685
984
2010
7,244
3,455
864
Total employees
12,885
11,563
The increase in personnel figures compared to the prior
year resulted particularly from the initial consolidation of
acquired companies and from staff increases in the
strongly growing digital business units.
Raw materials and supplies and purchased merchandise
comprised paper costs amounting to € 181.7 million (PY:
€ 169.2 million).
The cost of purchased services was predominantly com-
posed of purchased third-party printing services and
professional fees, as well as publisher services in the
context of performance-based marketing. The purchased
third-party printing services also included paper costs.
Consolidated Financial Statements 155
Notes to the Consolidated Financial Statements
(22) Depreciation, amortization, and impairments
(23) Other operating expenses
The depreciation, amortization, and impairments broke
down as follows:
The other operating expenses broke down as follows:
€ millions
Impairment losses in goodwill
Amortization of other intangible assets
Impairment losses in other intangible
assets
Depreciation of property, plant, and
equipment
Impairment losses in property, plant, and
equipment
Depreciation of investment property
Impairment losses in investment property
Depreciation, amortization, and
impairments
2011
7.8
68.1
2010
0.0
48.9
0.6
2.2
€ millions
Advertising expenses
Mailing and postage expenses
Expenses for non-company personnel
Commissions and gratuities
Rental and leasing expenses
61.0
55.1
Maintenance and repairs
0.0
1.3
0.0
0.4
1.3
5.6
Travel expenses
Services provided by related parties
Foreign exchange losses
Adjustment of allowances for doubtful
receivables
138.8
113.5
Other taxes
Miscellaneous operating expenses
Other operating expenses
2011
201.4
163.0
111.7
71.2
39.7
32.4
22.2
20.7
11.7
7.9
7.1
95.0
783.9
2010
160.0
157.6
100.2
77.3
38.4
30.0
19.1
39.3
16.8
8.1
8.3
118.8
773.9
The increase in the amortization of other intangible assets
primarily resulted from increased effects of purchase price
allocations and additional amortization charges deriving
from the initial consolidation of acquired companies.
Impairment losses in goodwill primarily affected the Print
International segment.
Impairment losses in non-current financial assets applied
in the reporting year are included in the income from
investments.
The increase in other operating expenses due to more
intensive advertising measures was partially compen-
sated by the decline in services provided by related
parties in connection with the initial consolidation of
acquired companies.
156 Annual Report 2011 Axel Springer AG
The following professional fees for the services rendered
by the auditor Ernst & Young GmbH were recognized:
(25) Financial result
The financial result broke down as follows:
€ millions
2011
2010
Interest income from derivatives
Interest income from bank accounts
Interest income from loans and securities
Other interest income
Interest income
Interest expenses on liabilities due to
banks
Interest expenses on pension provisions1)
Interest expenses from derivatives
Miscellaneous interest expenses
0.0
2.5
0.1
19.5
22.1
– 13.4
– 15.0
– 7.8
– 9.3
0.1
1.5
0.1
9.1
10.9
– 7.9
– 16.6
– 10.3
– 9.5
Interest and similar expenses
– 45.4
– 44.4
Other financial result
Financial result
0.2
2.3
– 23.1
– 31.2
1) Less reimbursements and expected income from plan assets.
In the current year, the other interest income mainly com-
prised interest income from tax credits and the lapse of
accrued tax-related interest.
The total interest income and expenses for those financial
assets and liabilities that were not measured at fair value
through profit or loss are presented in the table below:
€ millions
Total interest income
Total interest expenses
2011
9.6
2010
7.1
– 24.3
– 19.9
€ millions
2011
2010
Audits of the annual financial statements
Other certification or appraisal services
Tax advisory services
Other services
Total professional fees
0.7
0.1
0.2
0.1
1.1
0.7
0.1
0.1
0.3
1.3
The professional fees for the audit of financial statements
include the audit of the separate financial statements of
Axel Springer AG and other German subsidiaries, and
the audit of the consolidated financial statements. The
other certification and appraisal services include fees for
the auditor’s review of the quarterly financial statements,
the semi-annual financial statement, and the audits to
verify compliance with certain contractual agreements.
The tax advisory fees include support provided with
regard to specific tax questions.
(24) Income from investments
The investment income in the reporting year of
€ 9.5 million (PY: € – 8.2 million) was particularly influ-
enced by the impairment losses on the investment in
Infor Biznes (€ 8.1 million).
In the prior year, the investment income mainly resulted
from an impairment of our investment in PRINOVIS
(€ 21.4 million) and from foreign exchange losses
(€ 16.7 million) that were recognized affecting net
income in the context of the reduction of our equity
interest in Do⁄an TV. These losses were partly offset
by profits from the sale of investments in Cora Verlag
(€ 6.4 million) and the sale of investments in regional
newspapers (€ 6.2 million) in the prior year.
Consolidated Financial Statements 157
Notes to the Consolidated Financial Statements
Companies having the legal form of a corporation resi-
dent in Germany are subject to corporate income tax at
the rate of 15 % and solidarity surcharge of 5.5 % of the
corporate income tax owed. In addition, the profits of
these companies are subject to trade tax, for which the
amount is municipality-specific. Companies having the
legal form of a partnership are subject to trade tax exclu-
sively. The net income is assigned to the shareholder for
purposes of corporate income tax.
The effects of different tax rates for partnerships and for
foreign income taxes from the tax rate applicable to Axel
Springer AG are explained in the reconciliation in the item
differing tax rates. The permanent differences resulted
mainly from impairment losses in goodwill and decon-
solidation effects that are not taken into account for tax
purposes. The adjustments made to the carrying amounts
of deferred taxes included € 2.2 million (PY: € 2.8 million)
for the non-recognition of deferred taxes on tax loss
carry-forwards. The adjustments made to the carrying
amounts of the prior year were mainly attributable to the
use of tax loss carry-forwards that have not been capital-
ized (€ – 33.6 million). The amount of non-deductible
operating expenses in the prior year resulted primarily from
non-deductible expenses from the disposal of investments.
(26) Income taxes
The income taxes paid or owed and the deferred taxes
are recognized under income taxes. The income taxes
consist of the trade tax, corporate income tax, and soli-
darity surcharge, and the corresponding foreign income
taxes. The income tax expenses are broken down below:
€ millions
Current taxes
Deferred taxes
Income taxes
2011
145.3
– 13.3
132.0
2010
142.0
– 38.4
103.6
The income tax expense applying the tax rate of Axel
Springer AG reconciles to the income tax expense rec-
ognized in the income statement as follows:
€ millions
Income before income taxes
2011
421.3
2010
377.7
Tax rate of Axel Springer AG
31.19%
31.19%
Expected tax expenses
131.4
117.8
Differing tax rates
Changes in tax rates
Permanent differences
Adjustments to carrying amounts of
deferred taxes
Current income taxes for prior years
Deferred income taxes for prior years
Non-deductible operating expenses
Tax-exempt income
Trade tax additions/deductions
Other effects
Income taxes
– 5.5
– 0.5
12.8
2.4
– 4.5
3.4
6.2
– 7.6
0.0
6.6
– 36.0
15.5
3.4
20.1
– 12.6
– 13.4
0.8
– 1.9
– 0.7
– 2.0
132.0
103.6
158 Annual Report 2011 Axel Springer AG
Deferred tax assets and liabilities were recognized to
account for temporary differences and tax loss carry-
forwards, as follows:
The net balance of deferred tax items from January 1 to
December 31, 2011, was derived as follows:
12/31/2011
12/31/2010
Deferred tax assets as of January 1
€ millions
2011
30.6
2010
16.3
Deferred
tax assets
Deferred
tax
liabilities
Deferred
tax assets
Deferred
tax
liabilities
Deferred tax liabilities as of January 1
– 164.3
– 167.9
Net tax position as of January 1
– 133.7
– 151.6
19.2
181.5
20.7
91.4
Deferred tax expenses of current year
13.3
38.4
Changes in deferred taxes recognized in
other comprehensive income
– 8.9
7.4
0.0
7.1
0.0
0.0
Changes in consolidation group
– 96.5
– 27.8
€ millions
Intangible
assets
Non-current
assets under
finance leases
Property, plant,
and equipment
Non-current
financial assets
Inventories
Receivables
and other
assets
Pension
provisions
Other
provisions
Liabilities
Temporary
differences
Tax loss
carry-
forwards
Total
Offsetting
Amounts as
per balance
sheet
0.5
113.2
0.2
123.6
1.6
0.8
9.4
9.7
6.6
19.0
0.9
0.0
1.3
0.6
3.9
1.3
1.8
1.2
2.2
29.2
6.2
11.5
0.6
0.0
7.8
0.1
0.9
1.1
66.8
309.8
72.8
225.3
17.2
84.0
– 56.5
0.0
309.8
– 56.5
18.8
91.7
0.0
225.3
– 61.0
– 61.0
27.5
253.3
30.6
164.3
The increase in deferred tax liabilities in intangible assets
results particularly from initial consolidations that occurred
in the reporting year. The contribution of real estate
assets and cash to Axel Springer Pensionstreuhand e.V.
to secure existing pension obligations led to a reduction
in deferred taxes in the other property, plant, and equip-
ment and pension provisions, and to an increase in de-
ferred taxes in receivables and other assets, non-current
assets under finance leases, and liabilities.
Net tax position as of December 31
– 225.8
– 133.6
Deferred tax assets as of December 31
27.5
30.6
Deferred tax liabilities as of December 31
– 253.3
– 164.3
Of the deferred tax assets, an amount of € 12.4 million
(PY: € 13.5 million), and of the deferred tax liabilities, an
amount of € 0.8 million (PY: € 7.4 million) can be realized
in the short term.
The amount of deferred tax assets to be disclosed in
accordance with IAS 12.82 was € 16.6 million (PY:
€ 17.7 million). It is expected that this amount can be
realized by application against the available operating
income.
Deferred taxes in the total amount of € 4.9 million (PY:
€ 13.8 million) were recognized directly in equity, as
they relate to matters that were likewise recognized
directly in equity.
In fiscal year 2011, no deferred tax assets were
recognized with respect to corporate income tax
loss carry-forwards amounting to € 187.3 million (PY:
€ 210.0 million), and with respect to trade tax loss
carry-forwards amounting to € 17.8 million (PY:
€ 21.2 million) because it did not appear probable that
sufficient taxable income could be generated for these
amounts in the near future. Of these tax loss carry-for-
wards, an amount of € 14.9 million (PY: € 23.0 million)
can be carried forward for up to five years and an
amount of € 10.5 million (PY: € 10.4 million) can be
carried forward for six to ten years. The utilization of
Consolidated Financial Statements 159
Notes to the Consolidated Financial Statements
tax loss carry-forwards that had not previously been
recognized as deferred tax assets caused a reduction in
income tax expenses of € 3.2 million (PY: € 33.5 million).
In the past fiscal year, there were corrections of recog-
nized tax loss carry-forwards due to tax audits or differ-
ing tax assessments in the amount of € 1.6 million (PY:
€ 0.0 million).
As a rule, deferred taxes must be recognized to account
for the difference between the Group’s interest in the
equity of the subsidiaries as presented in the consoli-
dated balance sheet and the corresponding investment
balances recognized in the financial statements for tax
purposes. Such differences can result from the retention
of earnings. Deferred tax liabilities were not recognized
on differences of € 6.0 million (PY: € 16.4 million) be-
cause a realization is not planned at the present time.
In the case of sale or profit distribution, the gain on
disposal or the dividend, respectively, would be subject
to taxation at 5 % in Germany; in addition, foreign with-
holding taxes might be incurred.
(28) Other income/loss
The other income/loss broke down as follows:
(27) Earnings per share
The earnings per share were determined as follows:
Net income attributable to
shareholders of
Axel Springer AG
€ mil-
lions
2011
2010
257.8
252.7
Weighted average shares
outstanding
Dilution effect of stock options
granted
000s
98,517
92,396
000s
0
167
Weighted average shares diluted
000s
98,517
92,563
Net income attributable to
shareholders of Axel Springer AG
per share
basic
diluted
€
€
2.62
2.62
2.73
2.73
Due to the share split carried out in the current year at a
1:3 ratio (see note (11)), the calculation of the weighted
average shares and the prior-year earnings per share
were adjusted.
2011
2010
€ millions
Before tax
Tax effect
Net
Before tax
Tax effect
Net
Actuarial gains/losses from defined benefit pension
obligations
Currency translation differences
Changes in fair value of available-for-sale financial assets
Changes in fair value of derivatives in cash flow hedges
Other income/loss from investments accounted for using
the equity method
Other income/loss
17.9
– 9.6
2.4
5.1
0.0
15.9
– 5.6
0.0
– 1.7
– 1.6
0.0
– 8.9
12.3
– 9.6
0.7
3.5
0.1
7.0
– 21.2
36.9
2.5
1.5
10.2
29.9
6.4
0.0
0.0
– 0.3
1.3
7.4
– 14.8
36.9
2.5
1.3
11.5
37.3
160 Annual Report 2011 Axel Springer AG
Notes to the consolidated statement of
cash flows
(29) Other disclosures
The cash and cash equivalents were composed of short-
term available cash in banks, cash on hand, and checks.
Capital expenditures of € 2.0 million (PY: € 6.8 million)
had not yet been realized as cash payments. This related
to additions in both intangible assets and property, plant,
and equipment.
In the context of an out-of-court settlement of the tax
cases of the Do⁄an TV Group and existing indemnifica-
tion obligations of Do⁄an Yahin Holding A.S., the latter
company agreed with Axel Springer to make funds in the
translated amount of € 64.7 million available for partici-
pation in a capital increase at Do⁄an TV Holding A.S. In
return, Axel Springer agreed to participate in the capital
increase with the provided funds. The capital increase
was implemented in August 2011. In accordance with
the economic content of the transaction, these cash
inflows and outflows were set off in the statement of
cash flows.
In the reporting year, we contributed both € 25.2 million
in cash and also real estate assets with carrying amounts
of € 17.3 million to the Axel Springer Pensionstreuhand
e. V. (see note (13)) in order to secure and service exist-
ing pension obligations of Axel Springer. In the prior year,
we contributed assets and liabilities at carrying amounts
of € 62.2 million to a joint venture in the context of the
merger of the eastern European business activities of
Axel Springer and Ringier.
Notes to the consolidated segment report
(30) Basic principles of segment reporting
The segment reporting reflects the internal management
and reporting structures.
The reporting format is structured according to the
operating business areas of the Axel Springer Group and
comprises the reporting segments Newspapers National,
Magazines National, Print International, Digital Media,
and Services/Holding.
Segment assets, liabilities, and investments were not
disclosed on the basis of operating segments as these
measures are not used for decision making at segment
level.
(a) Operating segments
The Newspapers National segment includes daily news-
papers and Sunday newspapers, national and regional
subscription newspapers, and advertising supplements.
This segment also included investments in German
newspaper publishing companies.
The Magazines National segment includes TV program
guides, women’s magazines, computer, car, sports, and
music magazines, as well as investments in magazine
publishing companies in Germany.
The newspapers and magazines published in foreign
countries are comprised within the Print International
segment.
The online and broadcasting activities are comprised
within the Digital Media segment. In particular, this
segment comprises online activities derived from print
brands and the activities of SeLoger, Idealo, Immonet,
auFeminin, StepStone, and ZANOX. Furthermore, this
segment also comprises the investment in the TV broad-
cast company Do⁄an TV.
The Services/Holding segment comprises the remaining
business activities, including services such as customer
service, sales, logistics, direct marketing, and office
buildings, as well as purely internal departments like IT,
accounting, personnel, and corporate staff departments.
Our three offset printing plants, investments in two offset
printing plants outside Germany, and the rotogravure
printing company PRINOVIS are likewise included in the
Services/Holding segment.
Consolidated Financial Statements 161
Notes to the Consolidated Financial Statements
(b) Geographical information
The activities of the Axel Springer Group are conducted
mainly in Germany and in other European countries.
For purposes of geographical segment reporting, the
revenues are segmented according to the location of the
customer’s registered office and the non-current assets
according to the location of the legal entity.
(31) Segment information
The segment information was compiled on the basis of
the recognition and measurement methods applied in
the consolidated financial statements. The external reve-
nues comprise circulation revenues from the sale of
publishing products, advertising revenues, and revenues
from rendering services. The internal revenues consist of
revenues from the exchange of goods and services
between the various segments. The transfer pricing is
based on cost coverage.
We use the performance figure EBITDA (earnings before
interest, taxes, depreciation and amortization) to meas-
ure segment earnings. In calculating this performance
figure, non-recurring effects and purchase price alloca-
tion effects are eliminated.
Non-recurring effects include effects from the acquisition
and disposal of subsidiaries, business divisions, and
investments, as well as impairment and write-ups of
investments, effects from the sale of real estate, and
special depreciation and write-ups of real estate used by
the company.
Impairments of financial assets in particular were dis-
closed as non-recurring effects in the Print International
segment (€ – 8.1 million), the Magazines National seg-
ment (€ – 0.3 million), the Newspapers National segment
(€ – 0.5 million), and the Services/Holding segment
(€ – 0.7 million; PY: € – 21.4 million). The other non-
recurring effects in the segments related to expenses
in connection with company acquisitions occurring or
planned at € – 2.6 million (PY: € – 4.7 million). In addition,
exchange losses in the amount of € – 18.4 million were
recorded as a non-recurring effect in the Digital Media
segment in the previous year, particularly in connection
with the reduction in our interest in Do⁄an TV, as well as
effects from disposals of investments and business in the
Digital Media segment at € 50.2 million, the Newspapers
National segment at € 6.2 million, and the Magazines
National segment at € 1.6 million.
The effects of purchase price allocations mainly consist-
ed of amortization and depreciation on intangible assets
and on property, plant, and equipment that were ac-
quired in the context of business combinations. They
also contain impairment losses on goodwill in the
amount of € – 6.5 million (Print International) and
€ – 1.2 million (Services/Holding).
Other disclosures
(32) Capital management
Beyond the provisions of German law applicable to stock
corporations, Axel Springer AG is not subject to any
further obligations relating to capital preservation, wheth-
er from its own Articles of Incorporation or from contrac-
tual obligations. The financial key figures we used for
management purposes are primarily earnings-driven.
The goals, methods, and processes of our capital
management are subordinate to the earnings-driven
financial key figures.
Particularly for financing business acquisitions we can
draw on firmly promised credit lines amounting to
€ 1.5 billion (until 2012) respectively € 1.0 billion (until
2013). The drawdown of the credit lines is tied to a com-
pliance with the credit terms. Since the existence of the
credit lines we have fully complied with all credit terms.
For the purpose of maintaining and adjusting the capital
structure, the company can adjust the dividend pay-
ments to its shareholders or purchase treasury shares
representing up to 10 % of the subscribed capital.
Treasury shares can be used for acquisition financing
or they can be retired. As of December 31, 2011, the
treasury shares represented 0.3 % (PY: 0.6 %) of the
company’s share capital.
162 Annual Report 2011 Axel Springer AG
(33) Financial assets and liabilities
The balance sheet items comprising financial assets and liabilities can be attributed to the measurement categories
according to IAS 39 as follows:
€ millions
Assets 12/31/2011
Other non-current investments and securities
Loans and advances
Other non-current financial assets
Trade receivables
Receivables due from related parties
Derivatives not designated as a hedging instrument
Other
Other assets
Cash and cash equivalents
Liabilities 12/31/2011
Financial liabilities
Trade payables
Liabilities due to related parties
Derivatives designated as a hedging instrument
Derivatives not designated as a hedging instrument
Other
Other liabilities
Assets 12/31/2010
Other non-current investments and securities
Loans and advances
Other non-current financial assets
Trade receivables
Receivables due from related parties
Derivatives not designated as a hedging instrument
Other
Other assets
Cash and cash equivalents
Liabilities 12/31/2010
Financial liabilities
Trade payables
Liabilities due to related parties
Derivatives designated as a hedging instrument
Derivatives not designated as a hedging instrument
Other
Other liabilities
Carrying
amount
Loans and
receivables
Financial
liabilities
Available-
for-sale
financial
assets
Financial
assets and
liabilities
held for
trading
No
category
according
to IAS 39
430.4
430.4
474.1
474.1
25.5
25.5
442.4
14.7
157.1
157.1
244.0
2.1
2.1
385.9
19.4
202.3
202.3
435.9
430.4
25.5
455.9
442.4
41.9
0.4
184.2
184.6
244.0
716.9
272.1
27.6
14.8
0.7
412.8
428.3
474.1
2.1
476.1
385.9
48.8
2.4
224.8
227.2
435.9
356.2
245.3
33.4
20.0
0.1
361.4
381.5
716.9
272.1
17.9
160.9
160.9
356.2
245.3
22.4
147.1
147.1
27.2
27.1
27.1
9.7
14.8
252.0
266.8
29.4
22.6
22.6
11.0
20.0
214.3
234.3
0.4
0.4
0.7
0.7
2.4
2.4
0.1
0.1
Consolidated Financial Statements 163
Notes to the Consolidated Financial Statements
With the exception of the following financial assets and
liabilities the valuation is at amortized cost.
Fair value
based on
market
price
Fair value
based on
observable
market
data
Fair value
not based
on
observable
market
data
€ millions
December 31, 2011
Other liabilities measured at fair value not based on ob-
servable market data referred to contingent considera-
tion from business combinations. Hereof, € 54.3 million
(PY: € 22.7 million) were recognized affecting net income.
The fair values mainly depending on the future develop-
ment of net income of the corresponding companies
developed as follows:
Other non-current
investments and securities
22.7
Derivatives not designated
as a hedging instrument
(positive fair value)
Derivatives not designated
as a hedging instrument
(negative fair value)
Other liabilities
December 31, 2010
Other non-current
investments and securities
72.5
Derivatives not designated
as a hedging instrument
(positive fair value)
Derivatives not designated
as a hedging instrument
(negative fair value)
Other liabilities
0.4
0.7
2.4
0.1
€ millions
as of January 1
Balance as of January 1
Balance
as of January 1
as of January 1
Balance
Balance
Initial consolidation
Reduction
Revaluation affecting net income
Revaluation not affecting net income
88.2
Compound
Payment
as of December 31
Balance as of December 31
Balance
as of December 31
as of December 31
Balance
Balance
2011
87.187.187.187.1
30.7
–38.8
–0.8
6.5
4.1
–0.5
88.288.288.288.2
2010
47.547.547.547.5
23.6
0.0
0.5
15.4
2.8
–2.7
87.187.187.187.1
87.1
Revaluation affecting net income was recognized in other
operating income with an amount of € 3.1 million (PY:
€ 1.2 million) and in other operating expenses with an
amount of € 2.3 million (PY: € 1.7 million).
With the exception of the financial liabilities presented in
the table below, the carrying amounts of the non-derivative
financial assets and liabilities were identical to their fair
values.
12/31/2011
12/31/2010
Carrying
amount Fair value
Carrying
amount Fair value
693.9
695.2
355.5
358.5
€ millions
Liabilities due to
banks
164 Annual Report 2011 Axel Springer AG
The net gains and losses of financial instruments (exclud-
ing interest and dividends) recognized in the income
statement are presented in the following table.
€ millions
Loans and receivables, financial liabilities
Available-for-sale financial assets
Financial assets and liabilities held for
trading
2011
– 5.6
– 1.4
– 0.1
2010
– 10.1
6.0
2.2
The net gains and losses in the categories of “loans and
receivables” and “financial liabilities” consisted mainly of
valuation allowances and the result from the currency
translation and almost entirely resulted from financial
assets and liabilities recognized at amortized cost or
at fair value not affecting net income.
The net gains or losses of available-for-sale financial
assets consisted mainly of the gains and losses on the
disposal of these financial assets. The net gains and
losses in the category of “financial assets and liabilities
held for trading” mostly resulted from valuation changes
and other expenses for financial derivatives assigned to
this category.
Relating to available-for-sale financial assets, positive fair
value changes of € 5.0 million were recognized directly in
equity for the remeasurement of our investment in iProperty.
The fair value adjustments of € 2.5 million recognized in
the prior year were derecognized in the reporting year
with no effect on net income. In the reporting year, as in
the prior year, none of the amounts recognized in equity
were reversed by recognition in the income statement.
(34) Financial risk management
With respect to its financial assets and liabilities, the Axel
Springer Group is exposed to financial market risks,
liquidity risks, and credit risks. The task of financial risk
management is to limit these risks by means of targeted
measures.
(a) Financial market risks
Financial market risks for financial assets and liabilities
mainly consist of interest rate risks and exchange rate
risks.
With regard to selected financial instruments, compliance
with prescribed loss limits is monitored on a daily basis.
In principle, the effects of these risks on the value can be
assessed promptly and, where applicable, the loss risks
can be reduced.
Selected derivative hedging instruments are used to
hedge risks. The use of financial derivatives is governed
by appropriate guidelines of the Group. These guidelines
define the relevant responsibilities, permissible actions,
and reporting requirements, and prescribe the strict
separation of trading and back-office functions.
To hedge the interest rate risk, we employ interest rate
derivatives such as interest rate swaps, collars, forward
rate agreements, and interest futures. The degree of
hedging specified in the Axel Springer finance regulations
ranges between 30 % and 100 % of the underlying trans-
action volume. In the annual average, 56 % (PY: 92 %)
of the liabilities to banks have been hedged. At balance
sheet date, an amount of € 360.0 million (PY:
€ 0.0 million) of the variable-interest liabilities due
to banks was not hedged.
Consolidated Financial Statements 165
Notes to the Consolidated Financial Statements
The effects of market interest rate changes on variable-
interest financial instruments not hedged with financial
derivatives are calculated using a sensitivity analysis.
Assuming a parallel shift in the yield curve of 50 basis
points, the financial result would change by € 1.8 million.
Due to the nearly complete hedging of variable-interest
liabilities due to banks, there would have been no mate-
rial effect on the financial result in the prior year.
Further effects of market interest rate changes in finan-
cial derivatives designated as hedging instruments in
the context of cash flow hedges are likewise determined
using a sensitivity analysis. Assuming a parallel shift in
the yield curve of 50 basis points, the change in the
market value of interest rate derivatives would amount
to € 1.9 million (PY: € 3.2 million). This effect would
have to be recorded in accumulated other comprehen-
sive income.
Risks of changes in value due to exchange rate fluctua-
tions in future foreign currency payments are mainly
avoided in that operating costs are incurred in the coun-
tries in which we sell our products and services. Remain-
ing currency risks from operations are insignificant to the
Group since the majority of EBITDA is earned in the euro
currency zone. In the reporting period, the share of
EBITDA not earned in euros was 11 % (PY: 11 %). Cur-
rency risks from foreign currency claims and liabilities
(without contingent consideration) with net exposures
starting at € 5 million per foreign currency are hedged by
means of coordinated forward exchange transactions.
Cash and cash equivalents in local currency that are
generated in non-EU countries are either reinvested to
develop the local business activities, placed at Axel
Springer AG and secured by forward exchange transac-
tions or distributed. Therefore, the foreign exchange risk
from fluctuating exchange rates for foreign currency cash
and cash equivalents is limited.
Effects from the currency translation of statements pre-
pared by subsidiaries in foreign currencies are recorded
directly in accumulated other comprehensive income.
Therefore, Axel Springer does not hedge such currency
effects.
(b) Liquidity risk
We continually monitor the availability of financial re-
sources to fund the company’s operating activities and
investments by means of a Group-wide liquidity planning
system and monthly cash flow analyses. The liquidity and
financial flexibility of the Axel Springer Group is secured
by firmly promised credit lines in the amount of
€ 1.5 billion (until 2012) and 1.0 billion (until 2013). Note
(17) contains an analysis of the due dates of our financial
obligations. The payment obligations for financial obliga-
tions that have been contractually agreed but not yet
recorded are presented in note (39).
(c) Credit risk
Financial assets may be impaired if business partners do
not adhere to payment obligations. The maximum exposure
to risk from financial assets, which are fundamentally
subject to credit risk, correspond to their carrying
amounts.
Significant risk items are contained in trade receivables,
receivables due from related parties, other assets, and funds.
166 Annual Report 2011 Axel Springer AG
To reduce the credit risk on trade receivables and re-
ceivables due from related parties, we conduct active
management of receivables, credit limits, and credit
checks of our business partners. Appropriate allowances
are formed to account for discernible default risks.
A deferred purchase price of € 125.0 million (PY:
€ 150.0 million) carried in other assets, and related inter-
est claims in connection with the sale of investments in
regional newspapers, are hedged by a contractual lien
on the shares sold.
Investments in securities are made only in instruments
with first-class ratings according to our finance regula-
tions. Investment in time deposits occurs exclusively at
financial institutions that belong to the deposit protection
fund and are classified by leading rating agencies as
being at least of Investment Grade Status (BBB, Baa).
(35) Financial derivatives
(a) Financial derivatives designated as hedging
instruments
In 2011, designated hedging instruments were used in
particular to hedge against the interest rate risks of long-
term liabilities. The cash flows were hedged through
interest rate derivatives (interest rate swaps and collars).
The maturities and nominal amounts of the interest rate
derivatives were chosen to match the corresponding
tranches of the variable-interest loans (hedged items).
The interest rate derivatives were measured at fair value.
The changes in the fair value are recognized in accumu-
lated other comprehensive income until the hedged item
is realized. As of December 31, 2011, loans in the nomi-
nal amount of € 280.3 million (PY: € 280.8 million) were
hedged. The fair value measurement of the interest rate
derivatives at the balance sheet date yielded negative fair
values of € 14.8 million (PY: € 20.0 million). Fair value
changes in the net amount of € 10.7 million (PY:
€ 14.2 million) after taxes were recognized in accumulat-
ed other comprehensive income.
(b) Financial derivatives not designated as
hedging instruments
As of December 31, 2011, currency swaps regarding
loans of foreign subsidiaries with a nominal amount of
€ 9.7 million (PY: € 31.3 million) had a negative fair value
of € – 0.7 million (PY: € 2.4 million). At the same time,
currency swaps regarding loans of foreign subsidiaries
with a nominal amount of € 15.2 million (PY: € 0.0 million)
had a positive fair value of € 0.4 million (PY: € 0.0 million).
In order to secure our investment in Do⁄an TV we con-
cluded several guarantee agreements (derivatives) with
the seller. As a reliable fair value measurement of our
investment in Do⁄an TV is not possible, the valuation
of the derivatives is at amortized cost according to the
recognition of our investment.
(36) Relationships with related parties
Related parties are defined as those persons and com-
panies that control the Axel Springer Group, or that are
controlled or subject to significant influence by the Axel
Springer Group. Accordingly, the members of the
Springer family, the companies controlled or subject to
significant influence by this family, as well as companies
in whose management they hold a key position have
been defined as related parties for the Axel Springer
Group. Control of the Group is exercised by Axel Spring-
er Gesellschaft für Publizistik GmbH & Co. or its parent
company, Friede Springer GmbH & Co. KG, a majority
of which is attributable to Dr. h.c. Friede Springer. In
addition, the subsidiaries and associated companies of
the Axel Springer Group have been defined as related
companies. In addition to the active members of the
Management Board and Supervisory Board of Axel
Springer AG (including their family members) and their
majority holdings, the institutions managing the plan
assets of the Axel Springer Group are also considered
related parties.
Consolidated Financial Statements 167
Notes to the Consolidated Financial Statements
Besides the business relationships with the consolidated
subsidiaries, the following business relationships existed
with related parties:
€ millions
Balance sheet
Loans
Receivables
Thereof trade
Thereof allowances
Provisions
Liabilities
Thereof trade
Income statement
Goods and services supplied
Goods and services received
Financial result
Total
Associated
companies
Other related
parties
Total
Associated
companies
Other related
parties
12/31/2011
12/31/2010
1.5
41.9
12.2
27.3
7.4
27.6
14.6
2011
90.3
101.9
0.4
0.7
39.7
11.4
2.6
0.0
9.4
6.4
87.9
75.5
0.0
0.8
2.1
0.8
24.7
7.4
18.2
8.3
2.3
26.4
0.4
0.6
48.8
18.2
25.0
6.6
33.4
19.3
2010
73.0
130.5
0.6
0.6
43.9
14.0
2.7
0.0
9.6
6.9
66.5
83.3
0.1
0.0
5.0
4.2
22.3
6.6
23.8
12.4
6.4
47.2
0.4
The changes in the allowances for receivables due to
related parties are presented in the table below:
€ millions
Balance as of January 1
Utilization
Reversals
Additions
Other changes
2011
25.0
0.0
– 0.1
1.3
1.1
2010
20.3
– 0.1
– 0.1
4.8
0.0
Balance as of December 31
27.3
25.0
As of December 31, 2011, receivables in the amount of
€ 40.5 million (PY: € 43.4 million) were neither past due
nor subject to valuation allowances. With regard to these
receivables, there were no indications at the reporting
date that would suggest that the related parties would
not fulfill their payment obligations.
The receivables due from associated companies included
a reimbursement right for pension obligations in the
amount of € 27.2 million (PY: € 29.4 million) (see note (13)).
168 Annual Report 2011 Axel Springer AG
The provisions refer to pension obligations owed to
members of the Management Board.
Goods and services provided to related companies were
mostly related to the distribution of newspapers and
magazines. The services received from related compa-
nies mainly comprised purchased publishing products
and printing services. A master agreement for the print-
ing of magazines is in effect with PRINOVIS until Decem-
ber 31, 2019. Under this agreement, services in the
amount of € 57.5 million (PY: € 58.7 million) were ren-
dered for companies of the Axel Springer Group in 2011.
In 2011, the fixed compensation of the members of the
Management Board of Axel Springer AG amounted to
€ 8.7 million (PY: € 8.7 million). The variable compensa-
tion amounted to € 8.3 million (PY: € 9.2 million). The
measurement of the share-based compensation granted
to the Management Board of Axel Springer AG gave rise
to other operating income of € 1.3 million in the reporting
year. In the prior year, this resulted in a personnel expense
of € 9.5 million. The pension provisions were increased
by an amount of € 0.8 million (PY: € 1.2 million).
The compensation of the members of the Supervisory
Board amounted to € 2.5 million (PY: € 2.8 million). This
figure included variable compensation of € 0.5 million
(PY: € 0.8 million). A Supervisory Board member re-
ceived a compensation of € 0.1 million (PY: € 0.1 million)
for his services as an author.
The compensation of the members of the Management
and Supervisory Board is described in detail in the com-
pensation report, which is part of the notes to the con-
solidated financial statements. The compensation report
is included in the section “Declaration on Corporate
Governance pursuant to Section 289a HGB and Corpo-
rate Governance Report”.
An amount of € 2.2 million (PY: € 2.2 million) was paid to
former Management Board members and special direc-
tors and their survivors. A total amount of € 25.6 million
(PY: € 26.9 million) was allocated to the provisions for
pension obligations.
For transactions with the institutions managing the plan
assets of the Axel Springer Group please find the expla-
nations in note (13).
(37) Contingent liabilities
As of December 31, 2011, contingent liabilities from
guarantees existed in the amount of € 16.2 million (PY:
€ 17.2 million). In addition, obligations from contingent
considerations existed in the amount of € 3.6 million (PY:
€ 7.6 million), but we consider their occurrence as not
probable.
(38) Contingent assets
Contingent assets were due from KirchMedia GmbH &
Co KGaA i.L. in the amount of € 273.0 million (PY:
€ 273.0 million (see note (10))). In addition, claims to
future tax concessions existed in relation to capital in-
vestment grants of € 8.5 million (PY: € 9.9 million).
Consolidated Financial Statements 169
Notes to the Consolidated Financial Statements
(39) Other financial commitments
(40) Events after the balance sheet date
The other financial commitments broke down as follows:
There were no significant events after the balance sheet
date.
€ millions
12/31/2011 12/31/2010
(41) Declaration of Conformity with the German
Corporate Governance Code
Axel Springer AG published the Declaration of Conformi-
ty with the German Corporate Governance Code issued
by the Management Board and Supervisory Board in
accordance with Section 161 of the German Stock Cor-
porations Act (AktG) on the company’s Web site
www.axelspringer.de → Investor Relations → Corporate
Governance, where it is permanently available to share-
holders. The Declaration of Conformity is also printed in
the Corporate Governance section of this Annual Report.
Purchase commitments for
- intangible assets
- property, plant, and equipment
- inventories
Future payments under operating leases
Future payments under finance leases
Long-term purchase obligations
Other financial obligations
15.5
4.0
9.9
113.3
32.6
173.5
348.9
14.3
5.0
11.5
88.8
0.8
383.4
503.7
The long-term purchase obligations resulted from paper
supply contracts.
The total future obligations under minimum lease pay-
ments from operating leases at December 31, 2011 are
broken down in the following table:
€ millions
Due in up to one year
Due in one to five years
Due in more than five years
Total
2011
31.1
69.9
12.3
113.3
2010
30.3
51.5
7.0
88.8
170 Annual Report 2011 Axel Springer AG
(42) Companies included in the consolidated
financial statements and share property
Share-
holding
in %
-
via
No.
-
No. Company
1
Axel Springer Aktiengesellschaft, Berlin (Parent company)
Fully consolidated companies
Germany
AS Online Beteiligungs GmbH, Berlin
AS Osteuropa GmbH, Berlin
AS TV-Produktions- und Vertriebsgesellschaft mbH, Hamburg
ASV Direktmarketing GmbH, Hamburg
Axel Springer Asia GmbH, Hamburg
Axel Springer Auto-Verlag GmbH, Hamburg
Axel Springer Digital TV Guide GmbH, Berlin
Axel Springer Financial Media GmbH, Munich
2
3
4
5
6
7
8
9
10
Axel Springer Media Impact Dienstleistungs-GmbH (previously Axel
Springer Mediasales & Service GmbH), Berlin
11 Axel Springer Media Logistik GmbH, Berlin
12 Axel Springer Mediahouse Berlin GmbH, Berlin
13 Axel Springer Medien Accounting Service GmbH, Berlin
14 Axel Springer Services & Immobilien GmbH, Berlin
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
1
1
1
1
1
1
1
1
1
1
1
1
1
15 Axel Springer TV NEWS GmbH, Hamburg
100.0
16
16 Axel Springer TV Productions GmbH, Hamburg
17 Axel Springer Venture GmbH, Berlin
18
‘Axel Springer Verlag’ Beteiligungsgesellschaft mbH, Berlin
19
Axel Springer Vertriebsservice GmbH (previously Axel Springer
Verlag Vertriebsgesellschaft mbH), Hamburg
20 B.Z. Ullstein GmbH, Berlin
100.0
100.0
100.0
100.0
100.0
21 Bergedorfer Buchdruckerei von Ed. Wagner (GmbH & Co.), Hamburg 100.0
22 BERLINER WOCHENBLATT Verlag GmbH, Berlin
23 BILD digital GmbH & Co. KG, Berlin
100.0
100.0
24 Buch- und Presse-Großvertrieb Hamburg GmbH & Co. KG, Hamburg 69.8
100.0
100.0
33
100.0
5) 6)
1
25 Commerz-Film GmbH, Berlin
26 comparado GmbH, Luneburg
27
COMPUTER BILD Digital GmbH (previously Computerbild Online
Dienstleistungs-GmbH), Hamburg
28 eprofessional GmbH, Hamburg
29
finanzen.net GmbH, Karlsruhe
30 gamigo AG, Hamburg
31 Gofeminin.de GmbH, Cologne
32 hamburg.de GmbH & Co. KG, Hamburg
33
34
35
36
Idealo Internet GmbH, Berlin
Immonet GmbH, Hamburg
ims Internationaler Medien Service GmbH & Co. KG, Hamburg
Juno Internet GmbH, Berlin
37 Niendorfer Wochenblatt Verlag GmbH & Co. KG, Hamburg
38 PACE Paparazzi Catering & Event GmbH, Berlin
39 Panther Holding GmbH, Berlin
40 Schwartzkopff TV-Productions GmbH & Co. KG, Hamburg
41 Smarthouse Media GmbH, Karlsruhe
42 Sohomint GmbH, Hamburg
43 StepStone Deutschland GmbH, Düsseldorf
44 StepStone GmbH, Berlin
45 Transfermarkt GmbH & Co. KG, Hamburg
46 Ullstein GmbH, Berlin
47 Umzugsauktion GmbH & Co. KG, Schallstadt
48 Visual Meta GmbH, Berlin
49 VVDG Verlags- und Industrieversicherungsdienste GmbH, Berlin
50 WBV Wochenblatt Verlag GmbH, Hamburg
51 ZANOX.de AG, Berlin
52 WBV Direktzustell-GmbH, Hamburg
Other countries
53 alFemminile s.r.l., Milan, Italy
54 Amiado Group AG, Zurich, Switzerland
100.0
55.0
100.0
100.0
51.0
74.9
100.0
55.0
74.9
100.0
100.0
100.0
100.0
91.0
72.6
100.0
100.0
51.0
100.0
51.0
77.7
100.0
100.0
52.5
100.0
100.0
100.0
5) 6)
5) 6)
5) 6)
5) 6)
5) 6)
5) 6)
5) 6)
5) 6)
5) 6)
5) 6)
5) 6)
5) 6)
5)
7)
5) 6)
7)
7)
5) 6)
1
1
1
1
46
1
50
1
1
1
7)
5) 6)
7)
7)
5) 6)
5)
7)
5) 6)
5) 6)
7)
7)
5) 6)
5) 6)
51
1
17
60
17
17
1
1
1
50
1
33
16
1
1
44
17
23
18
34
33
18
1
17
50
60
67
54
No. Company
68 Azet.sk a.s., Zilina, Slovakia
69 Belles Demeures S.A.S., Paris, France
70 Bonial SAS, Paris, France
71 Digital Window Inc., Wilmington, USA
72 Digital Window Limited, London, Great Britain
73 EMAS Digital SAS, Neuilly-sur-Seine, France
74 enFemenino SARL, Madrid, Spain
75
IT-Jobbank A, S, Copenhagen, Denmark
76 Les Publications Grand Public S.A.S., Neuilly-sur-Seine, France
77 Marmiton SAS, Paris, France
78 Népújság Kft, Békéscsaba, Hungary
79 Netmums Limited, Watford, Great Britain
80 NIN d.o.o., Belgrade, Serbia
81 Petöfi Lap- és Könyvkiadó Kft, Kecskemét, Hungary
82 Poliris S.A.S., Paris, France
83 PressImmo On Line S.A.S., Paris, France
84 Ringier Axel Springer CZ a.s., Prague, Czech Republic
85 Ringier Axel Springer d.o.o., Belgrade, Serbia
86 Ringier Axel Springer Media AG, Zurich, Switzerland
87 Ringier Axel Springer Polska Sp. z o.o., Warsaw, Poland
88 Ringier Axel Springer Print CZ a.s., Prague, Czech Republic
89 Ringier Axel Springer Slovakia a.s., Bratislava, Slovakia
90 SeLoger.com SA, Paris, France
91 SmartAdServer SAS, Paris, France
92
soFeminine.co.uk Limited, London, Great Britain
93 StepStone (UK) Ltd., Guildford, Great Britain
94 StepStone A, S, Copenhagen, Denmark
95 StepStone AB, Stockholm, Sweden
96 StepStone AS, Oslo, Norway
97 StepStone B.V., Leiden, Netherlands
98 StepStone France SAS, Paris, France
99 StepStone Ltd., Cork, Ireland
100 StepStone NV, Brussels, Belgium
101 StepStone Österreich GmbH, Vienna, Austria
102 StepStone Schweiz GmbH, Härkingen, Switzerland
103 StepStone Services Sp. z o.o., Warsaw, Poland
104 The Mbuyu Community B.V., Amsterdam, Netherlands
105 Trans Press d.o.o., Belgrade, Serbia
106 Viviana Investments Sp. z o.o., Warsaw, Poland
107 zanox B.V., Amsterdam, Netherlands
108 ZANOX Hispania SL, Madrid, Spain
109 zanox Inc., Chicago, USA
110 zanox ltd., London, Great Britain
111 zanox Reklam Hizmetleri Limited Şirketi, Istanbul, Turkey
112 zanox SAS, Paris, France
113 zanox Sp. z o.o., Warsaw, Poland
114 zanox SRL, Milan, Italy
115
ZANOX VEICULAÇÃO DE PUBLICIDADE NA INTERNET LTDA.,
São Paulo, Brazil
116 zanox we create partners AB, Stockholm, Sweden
117
ZÖLD ÚJSÁG Tömegkommunikációs és Kiadói Zrt, Budapest,
Hungary
Other subsidiaries1)
100.0
51
100.0
51
100.0
63
Germany
118 Achtunddreißigste “Media” Vermögensverwaltungsges. mbH, Berlin 100.0
119 Achtundfünfzigste “Media” Vermögensverwaltungsges. mbH, Berlin 100.0
120 Alster Wochenblatt Verlag GmbH, Hamburg
121 AS Buchversand GmbH, Munich
122 Axel Springer Digital TV GmbH, Berlin
123 Axel Springer Russland Holding GmbH, Berlin
124 Axel Springer Security GmbH, Berlin
125 B.Z. Media GmbH, Berlin
Share-
holding
in %
via
No.
3)
3)
5)
5)
5)
5)
70.0
100.0
100.0
100.0
50.1
50.0
100.0
100.0
100.0
100.0
94.0
100.0
99.7
94.0
93.0
7.0
100.0
100.0
100.0
50.0
100.0
100.0
100.0
99.7
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
99.9
0.1
100.0
100.0
100.0
89
83
36
72
51
65
60
96
65
60
18
60
85
18
90
83
90
86
86
2
86
84
86
2
60
60
96
96
96
44
96
96
96
96
43
96
96
51
85
87
51
51
51
51
51
28
51
51
51
100.0
100.0
100.0
100.0
100.0
100.0
20
18
1
50
18
1
3
1
1
1
1
1
1
1
1
30
1
32
1
1
1
1
55 Amiado Online AG (previously Students.ch AG), Zurich, Switzerland 100.0
126 BILD digital Verwaltungs GmbH, Berlin
100.0
56 APM Print d.o.o., Belgrade, Serbia
57 AR Technology SAS, Paris, France
58 AS-NYOMDA Kft, Kecskemét, Hungary
59 auFeminin.com Productions SARL, Paris, France
60 auFeminin.com S.A., Paris, France
61 Autoreflex.com SAS, Paris, France
62 Axel Springer - Budapest Kiadói Kft, Budapest, Hungary
63 Axel Springer - Magyarország Kft, Tatabánya, Hungary
64 Axel Springer España S.A., Madrid, Spain
65 Axel Springer France S.A.S., Neuilly-sur-Seine, France
66
“Axel Springer Russia” Geschlossene Aktiengesellschaft, Moscow,
Russia
67 Axel Springer Schweiz AG, Zurich, Switzerland
74.9 105
127 Dreiundfünfzigste “Media” Vermögensverwaltungsges. mbH, Berlin 100.0
25.1
83.0
100.0
100.0
82.2
100.0
92.9
93.5
100.0
100.0
100.0
100.0
85
73
63
60
2
57
1
1
1
1
3
1
128 Dreizehnte “Media” Vermögensverwaltungsges. mbH, Hamburg
129 Druck- und Verlagshaus Bergedorf GmbH, Hamburg
100.0
100.0
130 Einundsechzigste “Media” Vermögensverwaltungsges. mbH, Berlin 100.0
131 Finanzen Corporate Publishing GmbH, Berlin
100.0
132 Fünfundfünfzigste “Media” Vermögensverwaltungsges. mbH, Berlin 100.0
133 gamigo Korea Holding GmbH, Berlin
134 GMZ Druckerei-Verwaltungs-GmbH i. L., Berlin
135 hamburg.de Beteiligungs GmbH, Hamburg
136
Hammerich & Lesser Zeitschriften- und Buchverlag GmbH,
Hamburg
137 Hauptstadtsee 809. VV GmbH, Berlin
138 ims Verwaltungs GmbH, Hamburg
139 Informationsmedien Handels GmbH, Hamburg
100.0
74.9
100.0
100.0
100.0
55.0
100.0
No. Company
140 Jobanova GmbH, Munich
141 kinkaa GbR, Berlin
Share-
holding
in %
100.0
50.0
50.0
142 Neunundfünfzigste “Media” Vermögensverwaltungsges. mbH, Berlin 100.0
via
No.
44
33
39
1
143
Schwartzkopff TV-Productions Verwaltungsgesellschaft mbH,
Hamburg
100.0
16
144 Scubia GbR, Berlin
50.0
50.0
145 Sechzigste “Media” Vermögensverwaltungsgesellschaft mbH, Berlin 100.0
146 SmartAdServer GmbH, Berlin
147 Tarif24 GmbH, Berlin
148 TOPS Online Publications GbR, Luneburg
149 Transfermarkt Verwaltungs GmbH, Hamburg
150 Umzugsauktion Verwaltungs GmbH, Schallstadt
100.0
100.0
90.0
10.0
51.0
51.0
151 Vierundfünfzigste “Media” Vermögensverwaltungsges. mbH, Berlin 100.0
152 VISION MEDIA Holding GmbH, Hamburg
153 Zanox 1 AG, Berlin
100.0
100.0
154 Zweiundfünfzigste “Media” Vermögensverwaltungsges. mbH, Berlin 100.0
Other countries
33
39
1
60
33
26
33
23
34
1
1
51
1
5)
5)
155 Automotive Exchange Private Limited, Navi Mumbai, India
156 Axel Springer Editions SAS, Neuilly-sur-Seine, France
157 Axel Springer Group Inc., New York, USA
158 Axel Springer Hírszolgálat Kft, Tatabánya, Hungary
52.1
6
100.0 136
100.0
1
100.0 117
159 Axel Springer International Finance B.V., Amsterdam, Netherlands 100.0
160 Axel Springer International Group Limited, London, Great Britain
161 Axel Springer Media France S.A.R.L., Nanterre, France
162 Axel Springer Media Italia s.r.l., Milan, Italy
100.0
100.0
100.0
1
1
65
1
163
Axel Springer Publishing International Limited, London, Great
Britain
100.0 160
164 Axel Springer TV International Limited, London, Great Britain
100.0 160
165 Azet.sk – katalóg s.r.o., Zilina, Slovakia
100.0
166 Communications Smart AdServer Canada Inc., Montreal, Canada
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0 179
100.0
100.0
100.0
60.0
67
83
67
68
100.0 183
100.0
51.0
49.0
100.0
84
60
87
72
100.0 182
100.0 183
51.0
16.0
51.0
68
60
67
68
57
85
1
19
30
82
83
84
6
6
60
68
51
167 CompuTel Telefonservice AG, Chur, Switzerland
168 Cpress Media s.r.o., Zilina, Slovakia
169 Etoilecasting.com SAS, Paris, France
170 Euro Blic Press d.o.o., Banja Luka, Bosnia-Herzegovina
171 eurobridge Inc., New York, USA
172 EUROPRESS POLSKA Sp. z o. o., Warsaw, Poland
173 gamigo Inc., Wilmington, USA
174 GPAK Limited, London, Great Britain
175 Handelszeitung Medien AG, Zurich, Switzerland
176 Immostreet ES, Barcelona, Spain
177 Jean Frey AG, Zurich, Switzerland
178 Komunikuj.sk s.r.o., Zilina, Slovakia
179 Lightstate Limited, London, Great Britain
180 MS vydavatelstvi a.s., Prague, Czech Republic
181 ofeminin.pl Sp. z o.o., Warsaw, Poland
182 Perfiliate HoldCo Limited, London, Great Britain
183 Perfiliate Limited, London, Great Britain
184 Perfiliate Technologies Limited, London, Great Britain
185 Périclès Atlantique S.A.R.L, Casablanca, Morocco
186 Poradca podnikatela a.s., Zilina, Slovakia
187 Shanghai Springer Advertising Company Ltd. i. L., Shanghai, China 100.0
188 Shanghai Springer Distribution Company Ltd. i. L., Shanghai, China 100.0
189 Smart Adserver Limited, London, Great Britain
190 SPORT.SK s.r.o., Zilina, Slovakia
191 zanox Schweiz AG, Zurich, Switzerland
Fully consolidated special purpose entities
Germany
100.0
66.7
100.0
192
Axel-Springer-Immobilien-Fonds-II-Produktionszentrum Dr. Rühl &
Co. KG, Düsseldorf
193
Axel-Springer-Immobilien-Fonds-III-Ostflügel Dr. Rühl & Co. KG,
Düsseldorf
-
-
-
-
Investments accounted for using the equity method
Germany
194 buecher.de GmbH & Co. KG, Augsburg
195 Jahr Top Special Verlag GmbH & Co. KG, Hamburg
196 PRINOVIS Ltd. & Co. KG, Hamburg
Other countries
197
Editions Mondadori Axel Springer (EMAS) S.E.N.C., Montrouge
Cedex, France
198 INFOR BIZNES Sp. z o.o., Warsaw, Poland
199 PNS a.s., Prague, Czech Republic
33.3
50.0
25.1
1
18
1
50.0
65
49.0
27.0
87
86
Consolidated Financial Statements 171
Notes to the Consolidated Financial Statements
Share-
holding
in %
via
No.
19.9
27.4
33.3
33.3
4)
7
1
50
50
50
1
No. Company
Other associated companies2)
Germany
200 autohaus24 GmbH, Pullach
201 Berlin 1 Fernsehen Beteiligungs GmbH & Co. KG, Berlin
202 Blitz-Tip Medien Verwaltungs GmbH, Bad Soden am Taunus
203 Blitz-Tip Medien-Beteiligungsges. mbH & Co. KG, Bad Soden
204 Blitz-Tip Radio Hessen Beteiligungsges. mbH & Co. KG, Bad Soden 33.3
205 buecher.de Verwaltungs GmbH, Augsburg
33.3
206
BZV Berliner Zustell- und Vertriebsgesellschaft für
Druckerzeugnisse mbH, Berlin
207 “Direkt” Redaktionsservice GmbH, Hamburg
208 elbe WOCHENBLATT Verlagsgesellschaft mbH & Co., Hamburg
209 Filmgarten GmbH, Berlin
210 Hamburg 1 Fernsehen Beteiligungs GmbH, Hamburg
211 Harburger Zeitungsverwaltungsgesellschaft mbH, Hamburg
212 I.S.I. TV Productions GmbH, Berlin
213 Intermedia Standard Presse-Code GmbH, Hamburg
214 InterRed GmbH, Haiger
215 ISPC Intermedia Standard Presse-Code GmbH & Co., Hamburg
216 Jahr Top Special Verwaltungs GmbH, Hamburg
217 KG Hamburg 1 Fernsehen Beteiligungs GmbH & Co., Hamburg
218 Kurt Viebranz Verlag (GmbH & Co.), Schwarzenbek
219 Lager- und Versand-Service Melosch GmbH & Co. KG, Hamburg
220
“Lühmanndruck” Harburger Zeitungsgesellschaft mbH & Co. KG,
Hamburg
221 Mein Gutscheincode GmbH, Berlin
222 Melosch GmbH, Hamburg
223 Motor-Talk GmbH, Munich
224 MSV Medien Special Vertrieb GmbH & Co. KG, Hamburg
225 Myby Beteiligungsgesellschaft mbH i.L., Düsseldorf
226 Myby GmbH & Co. KG i.L., Düsseldorf
227 Qivive GmbH i.L., Bad Homburg
228 Radio Hamburg GmbH & Co. KG, Hamburg
33.3
46
24.8
24.9
42.0
27.0
24.8
40.0
32.0
24.0
32.0
50.0
27.0
24.9
50.0
24.8
30.0
50.0
20.0
50.0
25.1
25.1
33.3
35.0
50
50
33
1
1
40
1
1
1
18
1
21
1
1
33
1
1
24
1
1
1
1
229
TVB Transportvermittlungs- und Vertriebsgesellschaft in Bergedorf
mbH, Hamburg
20.0
21
230
V.V. Vertriebs-Vereinigung Berliner Zeitungs- und Zeitschriften-
Grossisten GmbH & Co. KG, Berlin
231 Verlag Hans-Jürgen Böckel GmbH, Glinde
232 Verlags-Gesellschaft Hanse mbH & Co. KG, Hamburg
233 Verwaltungsgesellschaft elbe WOCHENBLATT mbH, Hamburg
234
Verwaltungsgesellschaft MSV Medien Special Vertrieb m.b.H.,
Hamburg
235 Viebranz Beteiligungsgesellschaft mbH, Schwarzenbek
236 Volksdorfer Verlagsgesellschaft mbH, Hamburg
237 Wochenblatt Verlag Schrader GmbH & Co. KG, Buchholz
238 Wochenblatt Verlag Verwaltungsgesellschaft mbH, Buchholz
239 WVV Werbevertrieb-Verwaltungs- und Beteiligungs-GmbH, Berlin
240 Zeitungs- und Zeitschriften Vertrieb Berlin GmbH, Berlin
Other countries
241 Asocijacija Privatnih Media, Belgrade, Serbia
242 BULGARPRESS OOD, Veliko Tarnovo, Bulgaria
243 CZ Press s.r.o., Prague, Czech Republic
244 DISPANA S.L., Madrid, Spain
245 Edipresse A.S. SRL, Bucharest, Romania
246 HARLEQUIN MAGYARORSZÁG Kft, Budapest, Hungary
247 HUNGAROPRESS Sajtóterjesztö Kft, Budapest, Hungary
248 ITAS Media Private Limited, Delhi, India
249 Ons On Soft Co., Ltd., Seoul, Korea
250 PRINOVIS Ltd., London, Great Britain
251 Today Merchandise Private Limited, New-Delhi, India
252 VINA WOMAN UK Ltd., London, Great Britain
Other material investments
Other countries
48.5
1
24.8
50.0
24.8
21
50
50
50.0
24
24.8
50.0
24.8
24.8
33.3
35.5
20.0
25.5
50.0
33.3
40.0
45.0
24.0
49.0
21
50
50
50
46
1
85
1
19
64
1
1
1
6
20.1 133
25.1
19.1
30.0
1
6
60
4)
253 Do⁄an TV Holding A.S., Istanbul, Turkey
19.9
25
1) No full consolidation due to immaterial impact (relation of net income and balance sheet total of the
company to net income and balance sheet total of the Group).
2) No at equity consolidation due to immaterial impact (relation of net income of the company to net
income of the Group).
3) Control due to existing option rights.
4) Significant influence due to existing option rights.
5) Control and profit transfer agreement with the parent company.
6) The company has exercised the exemption options of Section 264 (3) of the German Commercial
Code (Handelsgesetzbuch – HGB).
7) The company has exercised the exemption options of Section 264b of the German Commercial
Code (Handelsgesetzbuch – HGB).
172
Boards
Supervisory Board
The Supervisory Board is composed of the following persons:
Name, occupation
Dr. Giuseppe Vita
Chairman of the Supervisory Board of
Axel Springer AG
Seats on other mandatory
Supervisory Boards
Dussmann Verwaltungs AG
Medical Park AG
Dr. h. c. Friede Springer
Vice Chairwoman of the Supervisory Board of
Axel Springer AG
ALBA plc & Co. KG aA (previously ALBA AG)
ALBA Finance plc & Co. KG aA (since July
2011)
Seats on comparable boards
in Germany and abroad
Peter Dussmann-Stiftung (Member of the Board of Trustees)
Allianz S.p.A., Italy (Chairman of the Board of Directors, since
December 2011, previously Vice Chairman)
Barilla S.p.A., Italy (Board of Directors)
Gruppo Banca Leonardo S.p.A., Italy (Chairman of the Board of
Directors)
Humanitas S.p.A., Italy (Board of Directors)
ALBA Group plc & Co. KG (Advisory Board, since May 2011)
Dr. Gerhard Cromme
Chairman of the Supervisory Board of
ThyssenKrupp AG
Oliver Heine
Attorney at law and partner in the
law firm Oliver Heine & Partner
Klaus Krone
Member of the Supervisory Board of
Axel Springer AG
Allianz SE (Vice Chairman)
Siemens AG (Chairman)
ThyssenKrupp AG (Chairman)
Compagnie de Saint Gobain, France (Board of Directors)
YooApplications AG, Switzerland (Board of Directors)
Dr. Nicola Leibinger-Kammüller
President and Chairwoman of the Managing Board of
TRUMPF GmbH + Co. KG
Lufthansa AG
Siemens AG
Voith GmbH
Prof. Dr. Wolf Lepenies
University Professor (emer.) FU Berlin;
Permanent Fellow (emer.) of the Wissenschaftskolleg
zu Berlin
Michael Lewis
Investment Manager
Cheyne Capital Management Limited, UK (Non-Executive)
Oceana Capital Partners LLP, UK (Executive Partner)
Oceana Concentrated Opportunities Fund Limited, Jersey, Channel
Islands (Non-Executive)
Oceana Fund Managers (Jersey) Limited, Jersey, Channel Islands
(Non-Executive)
Oceana Investment Corporation Limited, UK (Chairman)
Oceana Investment Partners LLP, UK (Executive Partner)
OIC 07178 Limited, UK (Executive)
United Trust Bank Limited, UK (Non-Executive)
UTB Partners Limited, UK (Non-Executive)
Histogenics Inc, USA (Non-Executive Director and Chairman, since
May 2011)
Peltours Limited, Israel (Non-Executive)
ProChon Biotech Limited, Israel (Chairman, until May 2011)
Shidonni Limited, Israel (Non-Executive)
Strandbags Holdings Pty Limited, Australia (Non-Executive
Chairman)
The Foschini Group, South Africa (Non-Executive)
Dr. Michael Otto
Chairman of the Supervisory Board of
Otto GmbH & Co KG
Otto GmbH & Co KG (Chairman)
FORUM Grundstücksgesellschaft m.b.H. (Advisory Board)
Robert Bosch Industrietreuhand KG (Partner)
Boards 173
Management Board
The Management Board is composed of the following persons:
Seats on mandatory
Supervisory Boards
Seats on comparable boards
in Germany and abroad
B.Z. Ullstein GmbH (Advisory Board)
Axel Springer Schweiz AG, Switzerland (Board of Directors)
RHJ International SA, Belgium (Board of Directors)
Time Warner Inc., USA (Board of Directors)
PRINOVIS Limited, UK (Board of Directors)
Management Board member
Dr. Mathias Döpfner
Chairman and Chief Executive Officer
Journalist
Rudolf Knepper (until December 2011)
Vice Chairman
Head of Printing, Logistics, and HR
Master’s degree in engineering and master’s degree
in business/engineering
Jan Bayer (since January 2012)
President WELT Group and Printing
Media scholar
Ralph Büchi (since January 2012)
President International Division
Master’s degree in business administration
ZANOX.de AG (Chairman)
Amiado Group AG, Switzerland (Chairman of the Board of
Directors)
Amiado Online AG, Switzerland (Chairman of the Board of
Directors)
auFeminin.com S.A., France (Board of Directors)
Automotive Exchange Private Limited, India (Non-Executive
Director)
Axel Springer Espana S.A., Spain (Board of Directors)
Axel Springer Schweiz AG, Switzerland (Vice Chairman of the
Board of Directors)
CompuTel Telefonservice AG, Switzerland (Chairman of the
Board of Directors)
Ringier Axel Springer Media AG, Switzerland (Chairman of the
Board of Directors)
Handelszeitung Medien AG, Switzerland (Chairman of the Board
of Directors)
ITAS Media Private Limited, India (Non-Executive Director)
SeLoger.com S.A., France (Supervisory Board)
zanox Schweiz AG, Switzerland (Board of Directors)
esmt European School of Management and Technology GmbH
(Supervisory Board)
Axel Springer International Finance B.V., Netherlands
(Supervisory Board)
Dogan TV Holding A.S., Turkey (Supervisory Board, since March
2011)
Independent News & Media PLC, Ireland (Board of Directors)
Ringier Axel Springer Media AG, Switzerland (Board of Directors)
B.Z. Ullstein GmbH (Advisory Board)
dpa Deutsche Presse Agentur GmbH (Supervisory Board)
Jahr Top Special Verlag GmbH & Co. KG (Advisory Board)
auFeminin.com S.A., France (Board of Directors)
SeLoger.com S.A., France (Supervisory Board, since June 2011)
Lothar Lanz
Chief Financial Officer and Chief Operating Officer
Master’s degree in business administration
Dr. Andreas Wiele
President BILD Group and Magazines
Lawyer
ZANOX.de AG
174
Glossary
Affiliate Sales partner or agent that receives a commis-
sion for advertising sales.
Cash and cash equivalents Cash on hand and cash in
certain bank accounts of a company, as well as sight
deposits, and term deposits, which can be liquidated on
a short-term basis.
Classifieds Small ads that generally appear in daily
newspapers and are arranged by specific categories,
such as jobs, property, and cars, for example.
Consolidation group All the companies included in the
consolidated financial statements, by way of full consoli-
dation or at equity.
Content portal Website containing editorial content, not
just advertising or navigation pages.
Contingent considerations Liabilities arising from
future purchase price adjustments (earn-out agreements)
and from option rights for the purchase of non-
controlling interests.
Cross-media Content-related, creative, and formal
cross-linkage of different media channels and advertising
vehicles with the goal of achieving optimal advertising
success by means of a multichannel approach.
Derivatives in cash flow hedges Financial instruments
used to hedge the risk of future variations in cash flows,
due to changes in interest rates or exchange rates, for
example.
Earn-out agreement Agreement under which the pay-
ments by the buyer to the seller are deferred to a later
point in time, payment often depends on the business
performance of the purchased company.
Equity method The equity method is a method of ac-
counting for associated companies in the consolidated
financial statements under which changes to the net
value of the company are added to or deducted from the
acquisition cost of the investment.
External revenues Revenues resulting from transac-
tions with companies and persons that are not part of
the consolidation group.
Fair value Amount at which an asset can be exchanged
or a liability settled between two knowledgeable, willing
parties in an arm’s length transaction. Fair value is de-
termined with reference to market prices (such as stock
market prices, for example), if available, or if not, on the
basis of reference transactions or valuation models.
Financial derivatives Financial instruments, the value of
which is derived from the value of an underlying (for
example, security, interest rate, currency, loan). Financial
derivatives are used for hedging currency and interest
rate risks, for example.
IFRS (International Financial Reporting Standards)
Accounting rules issued by the IASB (International
Accounting Standards Board).
Interest rate swap Contractually defined swap transac-
tion. In an interest rate swap, the interest payments under
a variable interest rate are exchanged with those under a
fixed interest rate, or vice versa. The party paying interest
under the fixed interest rate is protected against rising
interest rates (loan protection), while the party being paid
interest under a fixed interest rate is protected against
falling interest rates (investment protection).
IVW (Informationsgemeinschaft zur Feststellung der
Verbreitung von Werbeträgern). This German organiza-
tion tracks the reach of print media and online offerings.
Glossary 175
Layer ads Type of advertisement used in websites,
which are superimposed over the actual website content.
Reach Percentage of a target group that is reached at
least once by an advertising vehicle or combination of
advertising vehicles.
Newsroom An editorial center where all journalistic con-
tent is produced in bundled form for various media
channels, for example, online, TV, print, and mobile services.
Newsstand newspapers Unlike subscription newspapers,
newsstand newspapers are generally sold in retail outlets.
Online marketing Marketing of ad space on web portals.
Online marketplaces Electronic platforms that bring
vendors and buyers together, facilitate the comparison of
products and services, and allow for the direct placement
of online orders.
Paid content Digital or mobile content that users pay for
by means of subscriptions or usage-based fees.
Performance-based online marketing Form of adver-
tising under which an Internet sales partner (publisher)
receives a share of the proceeds of every successfully
completed transaction (for example, sale of a product or
sign-up for a newsletter), in the form of a commission.
Portal Website covering a wide range of different sub-
jects that helps users to navigate the Internet. Special-
interest portals such as car or book portals try to cover
the complete range of their target group’s interests by
way of a common entrance platform.
Registered shares of restricted transferability
Registered shares that can be transferred only with the
consent of the respective stock corporation.
Search term marketing Type of marketing geared to
specific target groups, using search engines. The cus-
tomer of such a service defines the search terms which,
when entered by the online user, will trigger the place-
ment of the customer’s banner or advertising message
on the search engine’s web page.
Special-purpose entities Companies that are formed
only for the purpose of fulfilling a specified, narrowly
defined purpose. A special-purpose entity must be con-
solidated if the Axel Springer Group controls the special-
purpose entity in substance or if, in substance, the ma-
jority of the risks and rewards from the special-purpose
entity’s operations lie with Axel Springer. For this pur-
pose, it is not required that the Axel Springer Group
holds an equity interest in the special-purpose entity, or
vice versa.
Tabloid format Small format for newspapers.
Unique visitors Number of persons who have visited a
website at least once during a specified period of time. It
corresponds to the net reach.
Pro-forma revenues Revenues that comprise revenues
from business combinations prior to the date of initial
recognition in the consolidated financial statements.
Purchase price allocation Process in which the pur-
chase price of a business combination is allocated to the
fair values of all identifiable assets and liabilities.
Visits Connected series of usage events (visits) on a
website. After an interruption of 30 minutes, a new visit is
counted. A usage event is defined as a technically suc-
cessful page load by an Internet browser from a specific
online offering.
Wallpaper ads Large-format ads on webpages.
Financial Calendar
March 7, 2012
Annual Report, annual financial statements press
conference, investor/analyst teleconference
April 25, 2012
Annual shareholders’ meeting, Berlin
May 9, 2012
Quarterly financial report as of March 31, 2012
August 8, 2012
Interim financial report as of June 30, 2012
November 7, 2012
Quarterly financial report as of September 30, 2012
Imprint
Address
Axel Springer AG
Axel-Springer-Strasse 65
10888 Berlin
Phone: +49 (0) 30 25 91-0
Investor Relations
ir@axelspringer.de
Phone: +49 (0) 30 25 91-7 74 21/-7 74 25
Fax: +49 (0) 30 25 91-7 74 22
Corporate Communications
information@axelspringer.de
Phone: +49 (0) 30 25 91-7 76 60
Fax: +49 (0) 30 25 91-7 76 03
Design
Axel Springer AG
Corporate Communications
Photos
Daniel Biskup (p. 3, p. 6)
Matti Hillig (p. 6, p. 7)
ullstein bild –
Beck (p. 110), Danigel (p. 112), Rosskamp (p. 109),
ullstein bild (p. 107), Corporate Communications
(p. 106–113)
The Annual Report and up-to-date information about
Axel Springer are also available on the Internet at
www.axelspringer.com
The English translation of the Axel Springer AG annual
report is provided for convenience only. The German
original is definitive.