Annual Report
16 Foreword
82
Report of the Supervisory Board
Executive Board
89 Consolidated Financial Statements
Contents
4
6
8
The Axel Springer share
10 Combined Management Report
12
22
39
42
57
62
Fundamentals of the Axel Springer Group
Economic Report
Economic Position of Axel Springer SE
Report on risks and opportunities
Forecast Report
Disclosures and explanatory report on the
Executive Board pursuant to takeover law
67
Corporate Governance Report
90
91
92
94
95
96
97
98
Responsibility Statement
Auditor’s Report
Consolidated Statement of
Financial Position
Consolidated Statement of
Comprehensive Income
Consolidated Statement of
Cash Flows
Consolidated Statement of
Changes in Equity
Consolidated Segment Report
Notes to the Consolidated Financial
Statements
173 Boards
2
Group Key Figures
in € millions
Group
Revenues
Digital media revenue share1)
EBITDA2)
EBITDA margin2)
Digital media EBITDA share1)
EBIT2)
Net income3)
Net income, adjusted2) 3)
Segments
Revenues
Classified Ad Models
Paid Models
Marketing Models
Services/Holding
EBITDA2)
Classified Ad Models
Paid Models
Marketing Models
Services/Holding
Liquidity and financial position
Free cash flow (FCF)2)
FCF excl. effects from headquarter real estate transactions2) 4)
Capex5)
Capex excl. effects from headquarter real estate transactions4) 5)
Total assets6)
Equity ratio2) 6)
Net liquidity/debt2) 6) 7)
Share-related key figures8)
Earnings per share, adjusted (in €)2) 3) 9)
Earnings per share (in €)3) 9)
Dividend (in €)10)
Year-end share price (in €)
Market capitalization11)
Change
2016
2015
– 0.1 %
3,290.2
3,294.9
67.4 %
61.7 %
6.5 %
595.5
559.0
18.1 %
17.0 %
72.5 %
69.6 %
4.9 %
47.7 %
7.4 %
471.1
450.0
299.9
449.0
304.6
279.3
16.8 %
– 6.4 %
– 2.6 %
– 9.7 %
16.3 %
– 3.9 %
– 6.6 %
−
– 9.8 %
– 16.6 %
−
−
879.5
753.1
1,481.6
1,582.2
856.2
72.9
354.6
214.4
82.2
– 55.7
270.5
229.7
– 156.8
– 130.4
878.9
80.7
305.0
223.2
88.0
– 57.1
299.8
275.4
– 131.4
– 116.9
– 0.7 %
6,456.2
6,504.7
40.9 %
38.6 %
−
– 1,035.2
– 1,066.6
8.5 %
57.5 %
5.6 %
2.41
3.94
1.90
2.22
2.50
1.80
– 10.1 %
46.13
51.34
– 10.1 %
4,977.2
5,539.3
Average number of employees
2.0 %
15,323
15,023
1) Based on the operating business (without the segment Services/Holding).
2) Further explanations with respect to the relevant key performance indicators on page 35.
3) Continuing operations see also notes to the consolidated financial statements under note (2d).
4) Referring to the new headquarter building in Berlin as well as to the sale of the office building complex in Hamburg.
5) Cash flow from operating activities minus capital expenditures, plus cash inflows from disposals of intangible assets and property, plant and equipment.
6) As of December 31, 2016 and December 31, 2015, respectively.
7) In 2015, without the purchase price received in connection with real estate sales amounting to € 67.5 million, attributable to the plan assets created for our pension obligations.
8) Quotations based on XETRA closing prices.
9) Calculation based on average weighted shares outstanding in the reporting period (107.9 million; PY: 99.7 million).
10) The dividend for the financial year 2016 is subject to the condition of approval by the annual shareholders’ meeting.
11) Based on shares outstanding at the closing price as of December 31, 2016, excluding treasury shares (107.9 million; PY: 107.9 million).
Foreword
Annual Report 2016
Axel Springer SE
Foreword
A successful year lies behind us. And thus also behind you.
We have achieved our goals and further expanded our
business. The prerequisite for this was the outstanding
commitment of our more than 15,000 employees world-
wide. They make Axel Springer what it is.
growth. This was again very strong and exceeded our
expectations. We are excellently positioned to benefit
from the structural change from print to online and an
expansion of the value chain.
Within the classified portals, the job portals have shown
the strongest organic growth - from a previously already
outstanding level. In the German real estate market, the
Immowelt Group has developed very well after the merger
of Immowelt and Immonet. Finally, we expanded the busi-
ness of vacation rental portals as a further important pillar
with strong brands such as Traum-Ferienwohnungen,
DanCenter and Danland.
Our journalistic products have also developed positively.
Organically, the focus was on expanding our strong media
brands. These have achieved high reach, especially
through the dissemination of content via digital platforms.
Our video views have risen to an average of around 2.7
billion per month.
With an EBITDA of € 595.5 million and an increase of
6.5 %, we have achieved the upper end of our forecast.
The same applies to the adjusted earnings per share
with an increase of 8.5 % to € 2.41. We propose an
increase in dividends from € 1.80 to € 1.90.
We have consistently pursued our digitization strategy.
Our digital business generated 67.4 % of total revenues
and 72.5 % of EBITDA. We generated 84.8 % of the
advertising revenues with the marketing of digital products.
More specifically: The Classified Ad Models have once
again made the largest contribution to earnings in all
segments in 2016. Axel Springer holds the world's top-
selling portfolio in this division. It consists mainly of market
leaders, which contributed 82 % of the revenues in this
segment. In particular, we concentrated on organic
4
Annual Report 2016
Axel Springer SE
Foreword
With the internationalization in what is now 15 countries,
the growth of Business Insider has continued to advance.
In 2016, we reached for the first time more than 100
million people worldwide in one month. Revenues in-
creased by 29 %. In addition, we have expanded our US
portfolio by acquiring eMarketer, a provider of high-quality
analyzes, studies and online market data, which is highly
profitable through subscription revenues. In partnership
with Discovery Communications, Axel Springer has also
added the shares in NowThis and Thrillist to the new
company Group Nine Media in the USA. Group Nine
Media, headquartered in New York, including the digital
network Seeker and the online media The Dodo, was
already one of the largest digital media companies with a
total of 3.5 billion monthly video views and more than 500
full-time employees.
The subscriber numbers of our BILD and WELT Paid
Models continue to grow strongly. At the end of the year
we had 421,000 digital subscriptions.
upday, our start-up for aggregated and journalist-curated
news content, developed together with Samsung in
2015, has developed very positively. The offering, which
has been established in several European countries, has
already reached the top ten of the online news brands in
Germany at the end of 2016, with 89 million visits and
just about a billion page impressions.
The past year was eventful not only for us as a media
company but also for our society. The British have voted
for leaving the European Union, the Americans elected
an extremely controversial candidate to their presidency.
A discussion about fake news and the influence of digital
media on voters has flared up. Wars, crises and expul-
sions in other parts of the world have led to a mass
exodus to Europe. A terrorist attack in Berlin just before
Christmas marked an alarming close to the year.
These events show: Strong, reliable media brands and
quality journalism with responsible publishers are indis-
pensable. Both for our business and for our free and
democratic society. Attitude, information and reliability
count. This is what we stand for.
We remain focused and passionate. Particularly at this
moment. And we are confident that we will further ex-
pand and strengthen our business in the new financial
year. We can do this best with your trust and support.
Thanks for being part of it.
Sincerely yours,
Mathias Döpfner
5
Executive Board
Dr. Mathias Döpfner
Jan Bayer
Chairman
President Paid Models
Born 1963, journalist.
Career milestones:
Frankfurter Allgemeine Zeitung,
Gruner+Jahr; Chief Editor Wochen-
post, Hamburger Morgenpost,
and DIE WELT. Member of the
Executive Board since 2000,
Chairman since 2002.
Born 1970, Master’s degree in
media studies. Career mile stones:
Süddeutsche Zeitung; Publisher
Volksstimme, Magdeburg; Publisher
Süddeutsche Zeitung; Chairman of
the Executive Board of the WELT
Group. Member of the Executive
Board since 2012.
6
Executive Board
Dr. Julian Deutz
Dr. Andreas Wiele
Chief Financial Officer
Born 1968, Master’s degree in
business administration. Career
milestones: OC&C Strategy
Consultants; head of M&A/Investor
Relations Pixelpark AG; CFO
Venturepark AG; CFO Steilmann-
Gruppe; Axel Springer International;
Head of Group Controlling/Corporate
Development Axel Springer SE.
Member of the Executive Board
since 2014.
President Marketing and
Classified Ad Models
Born 1962, lawyer.
Career milestones: Editor,
Hamburger Morgenpost; Head
of Publishing Capital and Geo,
Gruner+Jahr, Paris/France;
Execu tive Vice President and Chief
Operating Officer of Gruner+Jahr
USA Publishing, New York.
Member of the Executive Board
since 2000.
7
The Axel Springer share
Annual Report 2016
Axel Springer SE
The Axel Springer share
Difficult year on the Stock Exchange
in 2016
The stock market has seen a turbulent year. While the
overall market at the end of the year slightly improved on
average, the media sector suffered losses overall. The
German DAX index ended the financial year with a slight
gain of 3.7 %, the MDAX index in which the Axel Springer
share is also listed increased by 4.1 %. At the end of the
year, the European media sector index DJ EuroStoxx
Media was down 5.9 % on the previous year. The
Axel Springer share, which developed better than most of
the benchmark indices at mid-year, recorded a loss of
10.1 % at the end of the year. Market capitalization was
approximately € 5.0 billion at the End of 2016.
Performance Axel Springer Share
Axel Springer
1)
DAX
MDAX
1)
DJ EuroStoxx Media
1)
55
50
45
40
Closing price: € 46.13
Investor Relations
The company’s Management and Investor Relations
team presented the company and its strategy at investor
conferences and road shows in Europe and the United
States on a total of 19 days. In addition, we maintained
an ongoing dialog with investors, analysts, and other
capital market players in numerous discussions and
telephone conferences throughout the year. As usual,
the telephone conferences held in connection with the
publication of our financial reports were broadcast live on
the Internet as audio webcasts, after which they re-
mained available to users of our website. The ninth an-
nual Capital Markets Day for analysts, institutional inves-
tors, and bank representatives was held at our company
headquarters in Berlin on December 8, 2016. This event
was broadcast live as a video webcast and is available
as a download from our website, together with the
presentations shown at the event. Finally, we inform
you regularly of current events in the Investor Relations
section of our website at www.axelspringer.de.
Share Information
€
Earnings per share (adjusted)1) 2) 3)
Earnings per share2) 3)
Dividend4)
2016
2015 Change
2.41
3.94
1.90
2.22
8.5 %
2.50
57.5 %
1.80
5.6 %
01/01/16
12/31/16
Total dividend payout (€ millions)
205.0
194.2
5.6 %
1)
Indexed on the year-end share price of Axel Springer SE as of December 31, 2015.
Year-end share price
46.13
51.34
– 10.1 %
Analyst coverage
The number of analysts publishing ratings of the
Axel Springer share decreased from 19 to 17 during
financial year 2016. Currently, seven brokers recommend
buying our shares, while the remaining ten are holding
them with “hold/neutral”. You can find the latest recom-
mendations and share price targets in the Investor Rela-
tions section of our website at www.axelspringer.de.
Highest price
Lowest price
51.34
59.04
– 13.0 %
39.91
46.46
– 14.1 %
Market capitalization (€ millions)5)
4,977.2
5,539.3
– 10.1 %
Daily traded volume
(Ø, € thousands)
Dividend yield4) 5)
Total yield per share per year6)
– 6.6 %
6.1 %
6,799.2
8,386.7
– 18.9 %
4.1 %
3.5 %
-
-
1) Further explanations regarding relevant key performance indicators on page 35.
2) Continuing operations see also notes to the consolidated financial statements under
note (2d).
3) Calculation based on average weighted shares outstanding in the reporting period
(107.9 million; PY: 99.7 million).
4) The dividend for the financial year 2016 is subject to the condition of approval by
the annual shareholders’ meeting.
5) Based on shares outstanding at the closing price as of December 31, 2016,
excluding treasury shares (107.9 million; PY: 107.9 million).
6) Share price development plus dividend payment.
8
Annual Report 2016
Axel Springer SE
The Axel Springer share
Shareholder Structure
Share ownership program
Axel Springer Gesellschaft für Publizistik
General Atlantic
Dr. h.c. Friede Springer
Other shareholdings
Dr. Mathias Döpfner
38.6 %
3.2 %
5.1 %
5.9 %
47.3 %
Status: December, 2016
Annual shareholders’ meeting
The annual shareholders' meeting of Axel Springer SE
took place in Berlin on April 13, 2016. Approximately
435 shareholders or 88.7 % of capital carrying voting
rights participated. All resolutions proposed by the Man-
agement – including the proposal to pay a dividend of
€ 1.80 (PY: € 1.80) per qualifying share – were approved
by majorities of at least 92.7 %. Based on the closing
price of the company’s share at year-end 2015, the divi-
dend yield came to 3.5 %. The total dividend pay-out to
our shareholders was € 194.2 million. This corresponds
to a gain of 9.0 % compared with the prior-year figure.
In previous years, our employees had the opportunity to
benefit directly from the appreciation of the company’s
value by participating in our share ownership program.
To date, the participation of employees of Axel Spring-
er SE and its domestic subsidiaries has been possible. In
2016, the existing share participation program was sus-
pended and fundamentally revised, with the aim, among
other things, of extending the number of eligible persons
to a larger number of companies belonging to the group.
A new program is expected to be launched in mid 2017
and will be gradually extended after a successful pilot
phase in the following years. A monthly purchase of
shares is planned through the basic salary of employees
with a grant of 30 % and a subsequent holding period of
two years.
Information on Listing
Share type
Registered share with restricted
transferability
Stock exchange
Germany (Prime Standard)
Security Identification Number
550135, 575423
ISIN
Thomson Reuters
Bloomberg
DE0005501357, DE0005754238
SPRGn.DE
SPR GY
9
Annual Report 2016
Axel Springer SE
Combined Management
Report
Combined Management Report
12 Fundamentals of the Axel Springer Group
22 Economic report
39 Economic Position of Axel Springer SE
42 Report on risks and opportunities
57 Forecast Report
62 Disclosures and explanatory report on the
Executive Board pursuant to takeover law
67 Corporate Governance Report
10
Annual Report 2016
Axel Springer SE
Combined Management Report
Summary of business performance and
operating results in 2016
Axel Springer has had a successful conclusion to the
2016 financial year. The forecast targets published in
March 2016 were essentially attained (see page 59).
During the reporting year, revenues were
€ 3,290.2 million and 0.1 % below the prior-year figure
(€ 3,294.9 million). Consolidation and currency effects
played an essential role. Adjusted for these effects, total
revenues were 4.1 % higher than the previous year.
While Classified Ad Models increased significantly, reve-
nues from Paid Models and Marketing Models were
below the prior- year level.
Outlook for 2017
For the financial year 2017, we expect Group revenues to
increase by an amount in the medium single-digit percent-
age range. We assume that the planned increase in adver-
tising revenues will overcompensate the slight decline in
circulation revenues and the decline in other revenues.
For EBITDA, we expect a rise in the medium to high
single-digit percentage range. An increase in EBITDA in
the Classified Ad Models and Marketing Models segment
is expected, while the earnings in the Paid Models seg-
ment should be roughly on par with the prior-year level.
For the Services/Holding segment an EBITDA below the
prior-year level is expected.
The transformation towards an increasingly digital company
is reflected in the share of digital business in our key figures:
in 2016, we generated 67.4 % of our revenues and 84.8 %
of our advertising revenues in the digital market.
For EBIT, due to higher depreciation, we expect an
increase in the medium single-digit percentage range.
For the adjusted earnings per share, we expect a rise
in the medium to high single-digit percentage range.
EBITDA rose, compared with the previous year, by 6.5 %
to € 595.5 million (PY: € 559.0 million). The generated
EBITDA margin thus improved to 18.1 % (PY: 17.0 %).
The significant growth in earnings in our Classified Ad
Models and the slight profit improvement within the Ser-
vices/Holding segment were offset by the declines in the
Paid Models and Marketing Models. Altogether, we gen-
erated 72.5 % of our operating profit with digital activities.
Adjusted earnings per share from continuing opera-
tions of € 2.41 were 8.5 % above the prior year's figure
of € 2.22.
Introductory remarks
The combined management report for Axel Springer SE
and the Group are summarized. The current combined
management report for Axel Springer SE and the Group
contains statements concerning the economic situation
and business performance of the Axel Springer Group.
These statements are also largely applicable to Axel
Springer SE. Additional information on the economic
situation of the parent company Axel Springer SE is
provided in a separate chapter on page 39.
At the annual shareholders' meeting to be held on April
26, 2017, the Executive Board and Supervisory Board
will propose a dividend of € 1.90 (PY: € 1.80) per quali-
fying share.
For further information on the performance indicators used
and the adjustments to our performance indicators, please
refer to page 35 of the management report and the notes
to the consolidated financial statements section (32).
11
Annual Report 2016
Axel Springer SE
Combined Management Report
Fundamentals of the Axel Springer Group
Fundamentals of the Axel Springer Group
Segments
Axel Springer Group
Classified
Ad Models
Paid
Models
Marketing
Models
Services/
Holding
Business model
Segments of the Axel Springer Group
Axel Springer is a leading digital publisher in Europe and
operates the world's largest portfolio of digital classifieds.
Journalism is the foundation of the business model and
the focus of the company is on the transformation to-
wards an increasingly digital company. Today 67.4 % of
total revenues and 72.5 % of EBITDA are generated by
digital activities. In addition to our Classified Ad Models,
whose revenues are mostly generated by job, real estate
and car ads, the Paid Models include a broad-based
media portfolio of successfully established brand families,
such as the BILD Group and the WELT Group. Journal-
istic content is delivered to Internet users, readers, view-
ers, and advertising customers via digital, print, and TV
channels. The Marketing Models segment comprises all
business models that generate revenues predominantly
through advertising customers.
Legal structure, business locations
Axel Springer SE, as the flagship company of the Axel
Springer Group, is an exchange-listed stock corporation
with its registered head office in Berlin. The Group also
maintains offices at other locations in Germany. In addi-
tion, the Group comprises numerous companies in other
countries. The consolidated shareholdings of the Group
are listed in Section (43) in the notes to the consolidated
financial statements.
Axel Springer’s business activities are organized into
three operating segments: Classified Ad Models, Paid
Models and Marketing Models. In addition, there is the
Services/Holding segment.
The segment structure reflects the different customer
groups and revenue types of an increasingly digital
publisher.
Classified Ad Models
All business models which predominantly generate their
revenues in online classified advertising are summarized
in the Classified Ad Models segment.
Portfolio and market position
Axel Springer has established the world’s largest portfo-
lio of leading online classified ad portals over the last few
years. The main activities of the Classified Ad Model
segment are bundled in the areas of jobs, real estate,
general and other, such as vacation home rentals and
automobiles, and are shown in the following graph.
Portfolio Classified Ad Models
Jobs
Real Estate
StepStone
Totaljobs
Jobsite
Saongroup
YourCareerGroup
SeLoger
Immowelt/Immonet
Immoweb
General/
Other
@Leisure
LaCentrale
Yad2
meinestadt.de
12
Annual Report 2016
Axel Springer SE
Combined Management Report
Fundamentals of the Axel Springer Group
Car&Boat Media, based in Paris, also belongs to the
segment. This company operates LaCentrale, the lead-
ing specialist classified ad portal for used cars in France,
as well as other portals related to cars and boats. Yad2
is the leading general classified ad portal in Israel for real
estate, automobile and classified ads. The German re-
gional portal meinestadt.de consists of marketplaces for
jobs, automobiles, real estate and classified ads.
Business model and key factors
The Classified Ad Models segment generates revenues
mainly from sales of classified ads. In addition, it also
generates revenues by marketing online ad space,
through cooperation arrangements, and by providing
software functions to clients. Business development is
significantly determined by the economic environment in
the respective market segments, the market position in
the respective segment, as well as by the online usage
behavior of advertisers and seekers. Long-term growth
drivers are, among others, the continuing shift of classified
ads to the Internet, new customer gains, the monetization
of the offers and the rising number of Internet users.
Within Jobs, ads are sold to advertisers, as well as logins
to online resume databases that belong to the respective
portals in which the job advertisers can actively search for
suitable candidates.
Real Estate primarily generates revenues by selling ad-
vertising and display space to agents, project developers,
housing agencies, or private individuals.
Within General/Other, revenues are based on the focus
of the relevant portal. These include, among others, com-
mercial automobile retailers, landlords of vacation homes,
real estate agents and project developers. The portals are
also partially aimed at private individuals who predomi-
nantly sell second-hand goods via this marketplace.
Jobs comprises the StepStone Group and its subsidiar-
ies, the leading company among the private-sector job
exchanges in Germany, Belgium, Luxembourg, the UK,
Ireland and South Africa. With its portals specialized in
specialist and managerial staff, StepStone in Germany,
according to the market research institute TNS, delivers
around three times more applications than the nearest
competitors. The Totaljobs Group and the Jobsite Group,
the two generalist main brands, which include, among
others, the specialist portals Caterer.com, CWJobs.co.uk,
CityJobs.com and eMedcareers.com, also deliver signifi-
cantly more applications in the UK than their competitors.
The specialty provider YourCareerGroup is the leading
niche portal in the German speaking countries for online
ads for hotel and restaurant jobs. Ictjob operates the
leading IT job portals in Belgium and Luxembourg.
In Real Estate, Axel Springer is the leader in France
(with SeLoger) and Belgium (with Immoweb). SeLoger’s
portfolio also includes some highly-specialized niche
portals such as vacances.com and a-Gites.com for vaca-
tion home rentals, and belles-demeures.com for luxury
properties. Seloger is the largest company in France in
the field of real estate offers and has been able to in-
crease its average revenue per agent through price
measures as well as an expansion of its offer in recent
years and reached an average value of € 676 per month
in 2016 (PY: € 615). Since July 2015, the real estate
segment has also included the German real estate portal
Immowelt, which together with Immonet is the clear
number two of the German real estate portals. In the
year 2016, the focus of the Immowelt Group was on the
marketing of the DUO offer, which allows agents to place
their properties on both portals. This resulted in a signifi-
cant increase in the average contact requests brokered
by the agents. At the same time, Immowelt with € 239
(PY: € 207) per month was able to significantly increase
the average revenue per agent in 2016.
General/Other includes @Leisure, a leading provider of
online travel agencies for holiday homes. The company,
headquartered in Amsterdam, runs among others the
portals belvilla, casamundo, TopicTravel, Aanzee and
VillaXL. In 2016, the company Traum-Ferienwohnungen
as well as the Land & Leisure group, which, among
others, runs the portal DanCenter, were taken over.
13
Annual Report 2016
Axel Springer SE
Combined Management Report
Fundamentals of the Axel Springer Group
Paid Models
The Paid Models segment encompasses all business
models that are primarily used by paying readers.
Portfolio and market position
Paid Models are sub-divided into national and interna-
tional offerings. The principal activities are summarized in
the graph below.
Portfolio Paid Models
National
International
BILD Group
WELT Group
Switzerland1)
USA
Belgium
Spain
France
Ringier Axel Springer Media
Poland
Hungary
Slovakia
Serbia
1) Since January 1, 2016 part of Ringier Axel Springer Schweiz AG.
Paid Models National mainly comprises the BILD Group
and the WELT Group, as well as the magazine portfolio.
The BILD Group comprises the digital media offerings and
the newspapers and magazines of the BILD family of
brands and B.Z. BILD.de is Germany's largest news and
entertainment portal with the widest reach in the country
with a digital subscription model. BILD.de is also distribut-
ed via mobile channels, with apps for nearly every kind of
smartphone, tablet PC, and smart TV, not to mention the
mobile portal, once again one of Germany’s most-visited
mobile media brands in 2016 (“digital facts 2016-10”,
AGOF - Working Group for Online Research). BILD.de also
offers the products stylebook.de, travelbook.de, tech-
book.de, BUNDESLIGA bei BILD, and BILD Shop.
BILD is Europe’s biggest daily newspaper with the wid-
est reach, as well as the unchallenged number one in
Germany, with a share of 75.2 % of newsstand sales.
(All figures for the German newspapers and magazines
are based on paid circulation as per German Audit Bu-
reau of Circulations “IVW - Informationsgemeinschaft zur
Feststellung der Verbreitung von Werbeträgern”) as
of December 31, 2016). In August 2016, the daily foot-
ball newspaper FUSSBALL BILD was test launched in
the large urban areas of Munich and Stuttgart initially on
a trial basis from Mondays to Saturdays. Due to suc-
cess in the test phase, FUSSBALL BILD has been pub-
lished nationwide since January 2017. BILD am
SONNTAG is Germany’s best-selling nationwide Sunday
newspaper in 2016, with a share of 61.0 %. B.Z. is one
of Berlin’s biggest newspapers. The automotive, com-
puter, and sports media of the BILD brand family make
up a magazine and online portfolio built on the core
brands of AUTO BILD, COMPUTER BILD, and SPORT
BILD. With a share of 51.7 %,
AUTO BILD is still the largest car magazine in Germany.
Autobild.de is the clear leader among automotive portals
featuring editorial content in Germany. Furthermore, the
magazine SPORT BILD reached a share of 49.7 % in
Germany based on paid circulation. COMPUTER BILD
is a leading computer magazine with a share in Germa-
ny of 35.3 %, measured by the paid circulation.
The WELT Group (WeltN24-GmbH) is a multi-media
news organization for quality journalism which comprises
the digital media offering, the newspapers DIE WELT and
WELT AM SONNTAG along with their compact publica-
tions and magazine inserts, such as BLAU and BILANZ
and the television channel N24.
WELT digital products are some of the most successful
stationary and mobile internet sites in the segment of
German premium newspapers. The offering is also avail-
able on PC tablets, smartphones, e-readers, and via
digital subscription models. The WELT AM SONNTAG is
the clear number one in the area of the supraregional
quality Sundays based on circulation. DIE WELT (includ-
ing WELT KOMPAKT) is the third-biggest premium news-
paper in Germany, with a share of 18.2 %, based on paid
circulation. N24 is the leader in the news channel seg-
ment and in 2016 was able to expand its market share to
1.5 % among the advertising group of 14 to 49-year-olds.
As part of merging the brands DIE WELT and N24, a
process began in 2015 to develop a common brand
identity for all products. In September 2016, the design
change of the TV station as well as the relaunch of the
digital offer WELT.de, including the conversion of the
digital subscription model from the initial pay model to a
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“freemium” model, took place. At the end of 2016, the
online brands WELT and N24 were merged with the aim
of developing the Group to become the leading multi-
media news organization for quality journalism in Ger-
man-speaking countries.
name is the country’s biggest newspaper, with a share of
38.2 %, based on paid circulation. In total, Ringier Axel
Springer Media publishes nine magazines in Slovakia. In
addition, the largest marketing organization in Slovakia
was launched in the form of Media Impact Slovakia.
Our music magazines ROLLING STONE, MUSIKEX-
PRESS and METAL HAMMER were also assigned to the
Paid Models National segment.
Paid Models International comprise Axel Springer’s
digital and print activities in Europe and the USA.
In Eastern Europe, Axel Springer with Ringier Axel
Springer Media is the leader in the segment of mass-
circulation dailies in Poland, Hungary, Slovakia, and
Serbia. The media offering currently comprises a variety
of digital and printed products. The digital EBITDA share
amounted to 54.6 % in 2016, with digital revenues
amounting to 42.2 %.
We reach 75.5 % of Internet users in Poland through the
leading Polish online group Onet. With FAKT as the larg-
est newsstand newspaper and PRZEGLAD SPORTOWY
as the country’s only national sports daily, we control
43.1 % of the market for national dailies (based on paid
circulation), making it the biggest newspaper publisher in
Poland. Moreover, we are represented by Media Impact
Polska, the largest marketing organization on the Polish
market. The range consists of strong brands and offers
clients innovative, integrated advertising solutions.
In Hungary, profession.hu, the country's leading job
portal belongs to Ringier Axel Springer Media's portfolio.
In addition, the portfolio comprises titles with a strong
market position in their respective sectors and with ex-
cellent potential for digitization, which predominantly
include mass-circulation dailies, including the leader
BLIKK, and women’s magazines.
In Slovakia, azet.sk is the leading Internet portal reaching
82.4 % of Internet users in that country. The leading posi-
tion in the print business is mainly based on the NOVY
CAS family of brands, consisting of two newspapers and
four magazines. The mass-circulation daily of the same
In Serbia, Ringier Axel Springer Media is the publisher
with the highest total circulation and reach, with three
newspapers and four magazines and the corresponding
web portals. ALO! And BLIC are among the largest mass
circulation dailies in Serbia. Blic.rs is the leading online
portal with the highest reach. Media Impact Srbija is also
the largest marketing organization in Serbia.
In Spain, Axel Springer is represented with five online
portals and eight magazines. In particular, we occupy
leading positions in the video game and computer mag-
azines segments and also in automotive magazines.
In France, Axel Springer is represented in a joint venture
with the Mondadori Group with three automobile maga-
zines (AutoPlus, L'AutoJournal, Sport Auto), the related
online portals and seven other sister magazines.
In Switzerland, Ringier Axel Springer Schweiz was
launched at the beginning of 2016. The company, jointly
founded by Axel Springer and Ringier, combines all Axel
Springer’s Swiss activities and a portion of Ringier’s
Swiss activities. For more information on this subject,
please refer to page 24.
The 50:50 joint venture between POLITICO, the leading
media brand for political journalism in Washington D.C.,
and Axel Springer, expanded its operations in 2016. The
offer now consists of seven different sector-specific paid
newsletters (so-called PRO Verticals), the politico.eu
website, a weekly paper, as well as conferences. The
POLITICO Group, headquartered in Brussels, also has
France's leading events agency in the field of public
affairs, Development Institute International.
In the US, Axel Springer is represented by the leading
digital offering for business and financial news, Business
Insider. In addition to the US portal, the company also
operates other services, such as the Insider portal in the
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Fundamentals of the Axel Springer Group
USA and Business Insider UK in Great Britain. In cooper-
ation with our Marketing Model finanzen.net, Business
Insider has been running a German portal since Novem-
ber 2015 and the Markets Insider portal since October
2016 in the USA. Since May 2016, a third European
edition of Business Insider and Axel Springer exists in the
form of a license to Onet in Poland. Overall, Business
Insider is now active in 15 countries.
Since July 2016 eMarketer belongs to Axel Springer and
complements the portfolio of innovative digital paid con-
tent in the English-speaking world, especially on the US
market. eMarketer is based in New York and is a leading
provider of analysis, studies and digital market data for
companies and institutions. With the acquisition of approx-
imately 93 % of the shares, Axel Springer also strengthens
its position in business-related news and content.
In December 2016, Axel Springer acquired 13 % of the
shares in Group Nine Media, a new, leading digital media
company based in New York, against the transfer of shares
in Thrillist and NowThis Media. GroupNine Media bundles
the Thrillist, NowThis Media, The Dodo, and Seeker, Dis-
covery's digital networks, focused on “Millennial” needs.
Furthermore, over the past few years, Axel Springer has
also established an early-phase portfolio in the USA that
focuses on digital journalism and includes, among others,
minority interests in Ozy, Mic and Jaunt.
In 2016 the news aggregator upday, developed in part-
nership with Samsung, was launched in four countries:
Germany, Great Britain, France and Poland. It is planned
that upday will start in Spain and Italy in March 2017 and
expand into ten other European countries in the second
quarter of 2017. The platform upday aggregates content
from more than 2,000 different sources. In addition to
“Top News”, selected and summarized by journalists,
messages are processed in the “My News” section by
means of an algorithm that reflects the individual inter-
ests of the users. In December 2016 upday was shown
for the first time in the IVW and landed with 89 million
visits and nearly one billion page impressions from the
starting blocks in the top ten of German news portals.
Business model and key factors
The revenues generated in the Paid Models segment
consist mainly of circulation revenues and advertising
revenues. Circulation revenues are generated on sales
of newspapers and magazines and digital subscriptions
models. Advertising revenues are generated by marketing
the reach of our online and print media. The value chain is
cross-media oriented. It encompasses all the essential
processes for the creation of information, entertainment
and moving image content, ranging from conception,
editorial work and production to sales and marketing. The
cross-media approach is conducive to the optimal reali-
zation of synergies, competencies and reach values.
All journalism content is collected in integrated news-
rooms, some of which are used for more than one publi-
cation, and processed there in accordance with the de-
mands of our print and online media. The production
process for digital paid content involves the production of
editorial content, which we then post on our websites or
other digital resources such as smartphones, PC tablets,
and smart TVs, or the processing and aggregation of
information in databases. Our newspapers are produced,
among others, in the three offset printing plants in Ham-
burg-Ahrensburg, Essen-Kettwig, and Berlin-Spandau.
We therefore carry out all steps in the value chain our-
selves, from production to monitoring dispatch logistics.
Distribution of digital products takes place predominantly
via our own Internet pages or download platforms such
as the app stores of Apple and Google. The print media
are distributed nationally and internationally mainly via
wholesale press distribution companies, train station
bookstores, and press import companies. In Germany
there are about 104 thousand retail outlets where our
newspapers and magazines are sold.
Paid Models are centrally marketed in Germany by Media
Impact, one of the leading cross-media marketers based
on gross market shares. The digital marketing portfolio
also includes content produced by other companies.
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Fundamentals of the Axel Springer Group
Axel Springer’s Reach Based Marketing portfolio in-
cludes idealo.de, Germany’s leading portal with the
widest reach for product searches and price compari-
sons. idealo searches nearly 1.9 million products and
more than 295 million offers of online dealers (Decem-
ber 2016 average) and is also internationally represented
with numerous offers. The product comparison portal
ladenzeile.de is also part of the idealo Group.
The aufeminin Group is the world's largest digital publish-
ing company for women. The group offers digital maga-
zines and product subscriptions in more than 20 coun-
tries on topics such as fashion, beauty, lifestyle, cooking
and health. These include, in addition to the internationally
represented aufeminin portals, Marmiton, France’s largest
digital offer on the subject of cooking, the lifestyle brand
My Little Paris with leisure tips, local recommendations
and subscriptions such as My Little Box, the British par-
enting portal netmums, the health care portal Onmeda in
Germany, France and Spain, as well as the Californian
company Livingly Media with its four different lifestyle
portals Livingly, Zimbio, StyleBistro and Lonny.
kaufDA.de and MeinProspekt.de operate under the auspi-
ces of the Bonial International Group as Germany's lead-
ing consumer information portals regarding local shopping.
The offerings distribute digitized retail advertising circulars
predominantly via mobile Internet at a regional level. The
services are offered under local brands also in France,
Sweden, Norway, Denmark (all Bonial), Spain, Mexico,
Chile, Colombia (all Ofertia) and the USA (Retale).
Business development in this segment is, among other
things, strongly influenced by the growing use of digital
content. Key growth drivers are moving images and the
mobile Internet, via smartphones and tablets, which are
mostly used in addition to stationary Internet connections
(source: AGOF “digital facts 2016-10”). Other key factors
besides online usage behavior are the willingness of
consumers to pay for online content and the develop-
ment of the market for paid content. Digital content is
also driving the growth of the advertising market, while
print media advertising revenues are declining across the
board. To counteract this development, in January 2017
Red Impact, a marketing alliance between Media Impact
and other media groups, entered the market.
Regardless of media types, this segment is influenced by
the political situation in the relevant markets, as well as
the economic environment and performance of advertis-
ing markets, in particular. Aside from the general market
cycles, seasonal aspects and non-recurring effects also
play a role.
Marketing Models
The Marketing Models segment comprises all business
models that generate revenues predominantly through
advertising customers in reach-based or performance-
based marketing services.
Portfolio and market position
The Marketing Models segment is sub-divided into
reach-based and performance-based services. The
principal activities are summarized in the graph below.
Portfolio Marketing Models
Reach Based Marketing
Performance Marketing
idealo
aufeminin
Bonial
finanzen.net
zanox/Digital Window
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Fundamentals of the Axel Springer Group
Germany’s widest-reaching finance portal, finanzen.net,
provides its users with up-to-date financial markets data
on every business day. The portal is, as part of its inter-
nationalization strategy, among others also represented
in Switzerland, Russia, Austria, and the Netherlands. In
addition, finanzen.net operates two portals in coopera-
tion with Business Insider: the German edition of Busi-
ness Insider as well as Markets Insider, an American
stock market portal launched in October 2016.
With direct and indirect investments in leading private-
sector radio stations in the TV and private radio sector,
Axel Springer holds one of the biggest radio portfolios in
Germany. Axel Springer continues to hold a minority
interest in Turkey’s biggest private-sector TV and radio
company, the Do⁄an TV Holding.
The Performance Marketing activities are bundled
within the zanox Group. The leading provider of success-
based online marketing in Europe brings advertisers and
publishers together, giving advertisers an efficient way to
market their products and services on the Internet. The
corporate group comprises the companies ZANOX AG,
including Digital Window, and the performance marketing
agency eprofessional. Since January 2017, the US com-
pany ShareASale has also been part of the zanox Group.
Business model and key factors
In our Reach Based Marketing activities, ad space is
marketed to advertising customers and charged on the
basis of the reach generated by the given media offerings
(number of users or listeners) or the interaction generated
by the reach. Attractive content generates high reach
values and topic-specific environments enable advertisers
to precisely reach the desired target groups.
Due to the rising use of online media, reach marketing on
the Internet is a major business. Besides display ads like
banners, layer ads, and wallpaper, videos are also increas-
ingly being used as online advertising formats. In addition,
advertisers are increasingly turning to marketing coopera-
tion ventures and innovative advertising forms such as
native advertising, sponsoring, and marketing via social
media channels. The increasingly automated purchase
and sale of advertising space (programmatic advertising)
as well as the growing prevalence of mobile terminal de-
vices, in addition to stationary Internet usage, represents
additional potential for Reach Based Marketing.
Performance marketing gives advertisers the chance
to advertise their products on websites and publishers’
offerings via text links, banners, and online videos. The
advertisers only pay a success-based fee to the publish-
ers if the advertising materials have actually been used
and resulted in the desired transaction for the advertising
customers. Our platforms provide the infrastructure for
this efficient form of marketing, record the data flows and
transactions, and allow for a variety of services for adver-
tisers and publishers.
This segment benefits from the growth of stationary and
mobile Internet usage and the increasing tendency of
consumers to make purchases. Through the zanox
Group, Axel Springer benefits from the increasing de-
mand of advertising companies for success-based ad-
vertising and marketing models.
Services/Holding
Group Services, which also include the three domestic
printing plants, as well as the holding functions are re-
ported within the Services/Holding segment. Group
services are purchased by customers within the Group
at standard market prices.
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Fundamentals of the Axel Springer Group
Discontinued Operations
In 2014, we sold our German regional newspapers,
program and women's magazines. We reported sepa-
rately the resulting income and expenses under review
as discontinued operations. (See note (2d) in the notes to
the consolidated financial statements).
Management and supervision
Executive Board divisions
The Executive Board of Axel Springer SE currently com-
prises four members, whose work is supported and
supervised by a Supervisory Board composed of nine
members.
Axel Springer Executive Board Divisions
Chairman and Chief Executive Officer
Dr. Mathias Döpfner
Executive
Board
Divisions
Chief Financial Officer
Dr. Julian Deutz
Paid Models
Jan Bayer
Marketing and Classified Ad Models
Dr. Andreas Wiele
Executive Board responsibilities are divided as follows:
Dr. Mathias Döpfner is Chairman and Chief Executive
Officer of Axel Springer SE. All editors-in-chief and the
corporate staff departments of corporate communica-
tions, public affairs, strategy, executive personnel as well
as the Axel Springer Academy report to him.
Dr. Julian Deutz is responsible for the Finance and Person-
nel Executive Board division. In addition to the commercial
sectors, the department also includes, among others, the
Audit, Personnel, Law, Group Purchasing, Group Security
and Governance, Risk & Compliance sectors.
Jan Bayer is the President of the Paid Models segment.
Apart from the journalistic product portfolio, Media Impact
(Marketing), Sales Impact (Sales), IT, Printing Plants and
Customer Services are also assigned to this segment.
Dr. Andreas Wiele is the President of Marketing and Clas-
sified Ad Models and is responsible for the corresponding
segments including the associated investments.
Corporate governance principles
Axel Springer’s corporate governance principles are
aligned with our core values of creativity, entrepreneur-
ship, and integrity. To this are added five principles en-
shrined in Axel Springer’s own corporate constitution.
You can learn more about our internal guidelines in the
section entitled “Important Management Practices” in the
declaration of corporate governance law pursuant to
Section 289a HGB on page 69 of this annual report.
Basic principles of the compensation system
The compensation of our employees, all the way up to
senior management level, consists of a fixed component
and – for qualifying employees an additional – variable
component. Variable compensation is determined on the
basis of individual performance and the company’s suc-
cess. To this end, individual target agreements encom-
passing both Group-wide targets and division targets are
adopted every year anew. The part of variable compen-
sation that reflects the attainment of Group-wide targets
in 2016 is determined mainly with reference to the finan-
cial indicators EBITDA and EBIT. A description of Execu-
tive Board compensation can be found in the “Compen-
sation Report” section of the “Corporate Governance”
chapter (starting on page 67). There, you will also find
information on the compensation of our Supervisory
Board members (starting on page 83).
Goals and strategy
Axel Springer pursues a strategy of profitable growth,
with the overarching goal of becoming the leading digital
publisher. This goal will be attained when the Group is
the leader in every one of the market segments and
countries in which it operates. Furthermore, journalism is
and always will be the foundation of our business model.
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Fundamentals of the Axel Springer Group
Segment strategies
In the Classified Ad Models segment, Axel Springer will
strive to further extend its position as leading international
provider. Here organic growth depending on complemen-
tary acquisitions will contribute to the growth of this busi-
ness. Synergies within the Group are used consistently.
Springer has founded the company Visoon Video Impact
for TV and motion picture marketing in Germany. Since
January 2016, Visoon Video Impact has been marketing
the entire portfolio of Axel Springer and Viacom (Comedy
Central, MTV, N24, Nickelodeon/Nicknight, VIVA) in the
TV sector in Germany.
Early-phase activities have also been started in the clas-
sified ads segment in order to identify innovative busi-
ness models and providers at an early stage.
In the Paid Models segment, Axel Springer will strive to
realize the full potential of its strong brands BILD and
WELT, as well as its international brands such as Busi-
ness Insider and eMarketer.
By means of linking its print, online, and mobile offerings
ever more closely, the BILD Group achieves a higher
level of reading time and usage time than its competitors,
expanding its share especially among young and high-
income readers. Through the digital brand subscription
BILDplus, Axel Springer is building and expanding a base
of paying online readers.
WELT, together with N24, wants to become the leading
multimedia provider of quality journalism that is able to
optimally serve print, digital and TV as well as out of
home. The two companies will contribute their respective
strengths to this endeavor. Thus, the WELT Group can
make good use of the video inventory of N24 in its media
offerings, and the quality TV news station can expand its
leading market position and better exploit its full online
potential in cooperation with the WELT Group. Further-
more, the WELT Group will use its digital subscription
model to further increase the base of paying readers on
the Internet.
The Group’s centralized marketing company Media
Impact offers an attractive, cross-media platform for
advertising campaigns – with a reach that is rivaled only
by the big TV marketing firms. As one of the leading
cross-media marketing firms (based on gross market
shares), Media Impact will continue to expand its external
marketing portfolio in the print and digital segments.
Together with Viacom International Media Networks, Axel
The strategy of sustainable growth in the Marketing
Models segment is followed both in Reach Based Mar-
keting and Performance Based Marketing. In the area of
Reach Based Marketing, the strategy is focused on
expanding the reach and usage of products, increasing
the ad space utilization rate, and developing new adver-
tising, pricing and business models. The continued inter-
nationalization of services is also a growth driver. Fur-
thermore, innovative products and business models are
promoted, developed and, if successful, expanded fur-
ther via capital expenditures in early-stage activities. In
the performance marketing sector, the focus is on the
increased interlinking of the activities combined within
the zanox Group, primarily through standardizing the
technical platform, as well as the expansion of services
and the publisher network.
Organic and acquisitions-driven growth
Generally speaking, the organic growth measures of the
different segments pursue the same goal of expanding
the current portfolio and increasing the revenues and
profits per user/reader on the basis of attractive product
design and pricing. These measures will be accompa-
nied by acquisitions-driven growth.
In all segments, Axel Springer seizes opportunities to
expand the business model by investing in companies
with innovative business ideas which are still in an early
phase of their development. In addition to indirect partic-
ipation in start-ups as part of our participation in the
early-phase fund Project A Ventures, the Axel Springer
Plug & Play Accelerator GmbH, which was founded
together with the Silicon Valley-based Plug & Play
Techcenter, is the main example. Furthermore, Axel
Springer has an equity stake in LAKESTAR II. The in-
vestment fund concentrates on digital companies with a
focus on Europe and the USA. A number of direct minor-
ity interests are also assigned on a selective basis to
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Fundamentals of the Axel Springer Group
these indirect interests in startups. Over the past few
years, Axel Springer has also established an early-phase
portfolio in the USA that focuses on digital journalism.
Above all, when the opportunities arise, companies that
are well-established in the market will be acquired. Suit-
able acquisition targets are chosen on the basis of com-
plementary business strategies, as well as the quality of
management, and the profitability and scalability of the
business model.
We employ a capitalized earnings approach based on
weighted capital costs to assess the economic efficiency
of investments in new or existing business segments.
We employ a capital markets equilibrium method, using
beta for the business-specific, systematic risk and a
market premium for the country-specific, unsystematic
market risk, to assess the risks of an investment oppor-
tunity. We assume that the systematic risk of our com-
pany is the same, on average, as that of our peer group.
Internal management system
We have designed our internal management system and
defined suitable control parameters in alignment with our
group 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. These reports
contain the monthly results of our most important activi-
ties, 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. When variances arise, we investigate
further or initiate suitable corrective measures.
Financial performance indicators
Our central focus is to sustainably increase both the
profitability and the value of our company. The most
important target and control parameters for the compa-
ny’s financial performance are revenues, EBITDA, and
EBIT. EBITDA and EBIT also form the basis for the per-
formance-based compensation of leadership (please
refer to page 76 for more information on the compensa-
tion system). These performance indicators and the
EBITDA margin are anchored in our internal planning and
controlling system.
Financial Control Parameters
Selected financial control
parameters on the Group level,
€ millions
Revenues
EBITDA1)
EBITDA margin1)
EBIT1)
2016
2015
3,290.2
3,294.9
595.5
559.0
18.1 %
17.0 %
471.1
449.0
1) Further explanations regarding relevant key performance indicators on page 35.
Non-financial performance indicators
In addition to the financial performance indicators, the
following non-financial performance indicators are rele-
vant to an evaluation of our performance with respect to
customers, the market, and offerings, although they are
not employed as the basis for managing the company as
a whole:
Unique users/visitors and other business model-
specific indicators of our online media, and the result-
ing market positions
Reach values of our media in the advertising market
and indicators of brand and advertisement familiarity
Average paid circulation of all principal newspapers
These reports are supplemented by periodic forecasts of
anticipated advertising revenues in the following weeks
and months as well as by forecasts of the probable
development of our financial performance.
and magazines
Digital subscriptions
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Economic Report
Economic Report
General economic conditions and business developments
According to estimates by the International Monetary
Fund (IMF), the global economy grew by 3.1 % in 2016,
slightly below the previous year's growth (PY: +3.2 %).
Global growth was the weakest in 2016 since the global
financial and economic crisis of 2008/2009.
According to the IMF, the increase in the industrialized
countries was markedly lower, with a plus of 1.6 % com-
pared to the previous year (+2.1 %). Essential for the
weaker growth is the disappointing development in the
US, the world's largest economy, which with +1.6 % -
due to a weak first half-year - notably remained behind
the previous year (PY+2.6 %). According to the IMF, the
euro zone has increased by +1.7 % in 2016 (PY +2.0 %).
For Great Britain, growth for the full year 2016 will be
+2.0 % (PY: +2.2 %); here the domestic demand after
the unexpected outcome of the EU referendum was
better than expected. Growth in emerging and develop-
ing countries remained at the previous year’s level at
+4.1 %, although the economic situation in the individual
countries varies considerably. The growth rate in China
(+6.7 %) turned out to be stronger than expected which
is also due to government support measures. The reces-
sion in countries such as Argentina, Brazil and Turkey
has led to a weaker than expected development.
The economic situation in Germany was also character-
ized by solid and steady economic growth in 2016. Ac-
cording to calculations by the Federal Statistical Office,
the price-adjusted gross domestic product was 1.9 %
higher than in the previous year. The decisive factor for
the positive development of the German economy was
domestic demand. Personal consumer spending in-
creased by 2.0 % in real terms over 2015. Public con-
sumption spending rose even more sharply, at 4.2 %.
This strong increase is partly due to the high level of
immigration of refugees and the resulting expenditure.
Investments also contributed to this economic growth.
The price-adjusted construction investment rose by
3.1 % in 2016, which was mainly due to higher invest-
ment in residential buildings. In equipment, 1.7 % in real
terms was also up compared to a year earlier. Exports
rose by 2.5 % in real terms, while imports rose by 3.4 %.
In 2016 the number of unemployed fell by 3.7 % to an
average of 2.7 million persons. The unemployment rate
was 6.1 %. The consumer climate, determined by the
Consumer Research Corporation, has deteriorated slight-
ly in the last quarter of 2016, based on a relatively high
level in the third quarter. However, consumer expecta-
tions about the economy and their income were higher by
the end of the year. According to calculations from the
German Federal Statistical Office, consumer prices rose
by 0.5 % during 2016. The slight rise in the inflation rate
was mainly caused by the rise in energy prices.
In Central and Eastern Europe, growth in the third
quarter slowed. According to the DIW (German Institute
for Economic Research) this is mainly due to lower in-
vestment activity. Thus investment projects from the new
EU funding line are still in the start-up phase up to the
year 2020 and the implementation was therefore initially
low. This was reflected in weak construction activity in
most countries. Growth in the region will continue to be
supported by private consumption, given the decline in
unemployment and the growth in real wages.
Industry environment
Press Distribution market
Whereas the circulation volumes of print media declined
again in 2016, online media continued the growth trend of
prior years. According to the study “digital facts 2016-10”,
AGOF - Working Group for Online Research - 54.2 million
people in Germany use the Internet today (Internet users
within the last three months). That number represents
78.0 % of German residents aged 14 and older. Of the
total regular Internet users, 70.0 % go online to obtain
information about world events and 62.1 % use the Inter-
net for regional or local news. Thus, reading the news is
one of the main thematic priorities, besides online
searches, email, online shopping, and weather forecasts.
Job listings are also one of the 20 most-used online cate-
gories. Alongside the wired Internet, the mobile Internet
continues to gain in importance according to the study. In
the last three months, 43.4 million people were mobile on
the Internet (62.3 % of the German-speaking population
in Germany aged 14 or over). In most cases (95.5 %)
mobile internet usage is predominantly in addition to
stationary use. According to the German Audit Bureau of
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Economic Report
Circulations “IVW -Informationsgemeinschaft zur Feststel-
lung der Verbreitung von Werbeträgern”, content portals
of German print media were visited somewhat more
frequently in 2016 compared to the previous year. The 20
most popular portals of German daily newspapers there-
fore increased the number of visits aggregated by 10.7 %,
while the number of visits to portals of the magazines
increased by 8.0 %.
The domestic press distribution market again de-
clined. The total paid circulation of newspapers/-
magazines was 4.9 % below the corresponding prior-
year figure. Thanks to the price increases implemented in
the past four quarters, however, circulation revenues
declined by only 1.9 %.
The 340 IVW-reported daily and Sunday newspapers
reached a total sales of 17.3 million copies per publica-
tion day. Compared to the prior-year figure, this corre-
sponds to a fall of 7.4 %. Newsstand sales (– 10.5 %) –
as in the prior year – suffered a much greater decline
than subscription sales (– 7.2 %). Demand in the segment
of daily and Sunday newspapers within the press distri-
bution market weakened by 4.9 %, according to the
respective frequency of publication.
The total sales of the public magazines including the mem-
bers and club magazines amounted to 94.6 million copies
per publication day. Compared to the prior-year figure, this
corresponds to a decline of 3.6 %. The number of IVW
registered titles was 773 (– 2.0 % compared to the previ-
ous year). Demand in the segment decreased - weighted
according to the frequency of publication - by 5.0 %.
Advertising market
The German Advertising Association (ZAW) assumes in
its current forecast for 2016, issued in November 2016,
that net advertising revenues will be approximately 2.5 %
higher than the prior-year figure.
According to the latest advertising market forecast of
ZenithOptimedia (“Advertising Expenditure Forecast“,
December 2016), the advertising market in Germany in
2016 grew by 3.1 % over the prior-year figure.
According to these surveys, net revenues of the total
advertising market during the reporting period were
€ 19.9 billion (including classified ads and advertising
supplements, less discounts granted and agency com-
missions, and excluding production costs), reflecting a
nominal increase of 3.1 % from the prior-year figure.
In the German online market (display ads, search term
marketing, and affiliates), net advertising revenues rose
by 8.4 % to € 6.3 billion in 2016.
In the category of print media, the net advertising reve-
nues of newspapers (newspapers, advertising supple-
ments, and newspaper supplements) amounted to
€ 4.7 billion in the reporting period, reflecting a 0.3 %
decrease from the prior-year figure. The net advertising
revenues of magazines (general interest and trade
magazines, directory media) declined by 3.8 % com-
pared with the prior year to € 2.4 billion.
In 2016, television advertising in Germany rose by 3.0 %
to € 4.6 billion, and net advertising revenues in radio
advertising rose by 3.8 % to € 771 million. The net
advertising revenues of outdoor advertising rose by
6.4 % to € 1.1 billion in 2016.
23
Annual Report 2016
Axel Springer SE
Combined Management Report
Economic Report
According to ZenithOptimedia, the following advertising
revenue developments are expected for selected coun-
tries in 2016:
Anticipated Advertising Activity 2016 (Selection)
Change in net ad revenues compared
to prior year (nominal)
Germany
United Kingdom
France1)
Poland1)
Switzerland2)
Hungary
Belgium2)
Slovakia1)
Netherlands
Serbia1)
Ireland
Italy1)
Spain1)
USA
Israel
Brazil
Online
Print
8.4 %
– 1.5 %
11.2 %
– 10.2 %
5.9 %
– 7.0 %
12.0 %
– 16.7 %
12.0 %
– 3.5 %
10.3 %
15.0 %
3.5 %
0.7 %
14.5 %
– 4.8 %
10.4 %
– 8.6 %
13.0 %
1.7 %
12.9 %
– 5.3 %
7.6 %
– 5.3 %
13.0 %
– 5.2 %
16.9 %
– 6.4 %
7.5 %
– 5.2 %
10.0 %
– 8.1 %
Source: ZenithOptimedia, Advertising Expenditure Forecast (December 2016).
1) Excluding Classified ads, that means exclusively sales from display advertising.
2) Gross advertising revenues (excluding classified ads).
Business performance
On January 1, 2016, together with Ringier, we jointly
founded the company Ringier Axel Springer Schweiz
AG in Switzerland. Since then, all Swiss-German and
West Swiss newspaper titles (including their associated
online portals) of Ringier as well as the West Swiss
broadsheet, Le Temps, and all of Axel Springer’s busi-
ness in Switzerland have been combined under the new
company. Axel Springer is consolidating the income from
investments on a pro-rated basis.
In January 2016, as part of its efforts focusing on the
digital growth strategy, Axel Springer closed the sale of
CarWale, a leading online portal for automobiles in the
Indian market, at a converted purchase price (after de-
duction of taxes) of € 64.0 million.
The sale of the first part of our Hamburg office build-
ing complex was also completed in January 2016. The
sale of the second part took place in the third quarter. In
Berlin, the construction of the Axel Springer new
headquarter building in the past financial year was
started in the immediate vicinity of the current publishing
house. Up to 3,500 employees are to work on approxi-
mately 52,000 square meters from 2020 onwards. The
total volume of the construction project will be around
€ 300 million. The cumulative investments made up to
the balance sheet date amounted to € 42 million; In-
vestments of around € 50 million are planned for the
2017 financial year.
Furthermore, in the first quarter of 2016, we additionally
sold about 2.3 % of our equity stake in Do⁄an TV
Holding A.S., Istanbul, Turkey, at a purchase price of
€ 55.3 million.
At the end of April 2016, FUNKE Mediengruppe prema-
turely repaid the 2014 vendor loan, including the accrued
interest in connection with the sale of our national regional
newspapers, as well as TV program guides and women’s
magazines. The loan, including capitalized interest, was
reported in other non-current financial assets at
€ 247.9 million. The repayment was initially budgeted for
a period of up to two years, starting mid 2018.
In the second and third quarters of the last financial year,
@Leisure Group, a leading operator of online portals for
vacation rentals in Europe that is majority owned by Axel
Springer, made two acquisitions for the purpose of ex-
panding its portfolio:
24
Annual Report 2016
Axel Springer SE
Combined Management Report
Economic Report
In April, the company acquired the majority shareholding
(50.01 %) of Traum-Ferienwohnungen GmbH, which
has its registered office in Bremen. Traum-Ferien-
wohnungen is a leading online marketplace for vacation
rentals in Germany and operator of the booking platform
“traum-ferienwohnungen.de”.
In the year under review, Axel Springer acquired a 10 %
stake in the second quarter and the outstanding 39 %
stake in Car&Boat Media in the fourth quarter for a pur-
chase price of € 89.7 million. Car&Boat Media operates
LaCentrale, the largest specialized car classifieds portal
in France.
In January 2017, Digital Window, a majority-owned sub-
sidiary of the Axel Springer Group, acquired 100 % of
the shares in ShareASale, a leading affiliate network in
the USA (see also notes to the consolidated financial
statements under note (41)). The preliminary acquisition
costs amounted to € 43.0 million.
Overall statement of the Executive
Board on the course of business and
economic environment
Digitization continues to be the defining trend for the
economic environment for media companies. This re-
flects the development of the Axel Springer Group seg-
ments. While the two fully digitized segments, the Classi-
fied Ads and Marketing, recorded significant organic
revenue growth, revenue declined slightly in the Paid
Models segment due to the higher proportion of the
structurally declining print business. Once again, busi-
ness development was characterized by acquisitions of
digital business models and active portfolio management.
The overall positive development in the financial year
confirms our strategy of rigorously digitizing the company.
At the end of July 2016, the @Leisure Group acquired a
total of 75.96 % of the shares in Land & Leisure A/S. In
a second step, in September we increased our share to
93.17 %, and in early October requested the minority
shareholders to transfer their shares to the @Leisure
Group in return for cash compensation (squeeze-out).
Squeeze-out took place in November. The total acquisi-
tion costs for the acquisition of the shares amounted to
€ 61.0 million. Land & Leisure A/S, under the brands
DanCenter Ferienhäuser and Danland Ferienpark, pro-
vides holiday homes in Denmark, Sweden, Norway and
Germany. With the takeover, the @Leisure Group
strengthens its market position in Scandinavia.
In July, Axel Springer acquired approx. 93 % of the shares
in eMarketer Inc., New York, USA, a leading provider of
high-quality analyses, studies and digital market data for
companies and institutions. The transaction is another
milestone in the strategy of growing in the English-speaking
regions – particularly the US market – through digital activi-
ties and expanding the portfolio of innovative Paid Models.
With this takeover, Axel Springer also strengthens its posi-
tion in business-related news and content. The acquisition
costs amounted to € 219.0 million.
In October, we added our holdings in NowThis Media
and Thrillist to Group Nine Media, which also includes,
besides our activities, the The Dodo and Seeker brands.
The valuation of Group Nine Media, on the basis of
which US Discovery Communications invested in addi-
tion to Seeker's contribution of USD 100 million in cash,
equals a valuation premium of over 70 % compared to
the valuation that was the basis for our 2015 investments
in NowThis and Thrillist.
25
Annual Report 2016
Axel Springer SE
Combined Management Report
Economic Report
Financial performance, liquidity, and financial position
The pro-forma revenues, which increased
from € 2,057.2 million by 7.7 % to € 2,216.5 million
during the business year, take into account the devel-
opment of companies currently belonging to Axel
Springer for the complete reporting and prior-year period,
partially on the basis of unaudited financial data.
International revenues of € 1,564.3 million were slight-
ly below the prior-year figure of € 1,573.5 million and
amounted to 47.5 % (PY: 47.8 %) of Axel Springer's total
revenues. The decline is attributable to the deconsolida-
tion of Swiss activities in the course of the jointly founded
company with Ringier (see page 24).
The increase in advertising revenues of 5.5 % to
€ 2,223.1 million (PY: € 2,107.6 million) was largely at-
tributable to growth in the Classified Ad and Marketing
Models. The decrease in advertising revenues in the Paid
Models segment was primarily due to consolidation ef-
fects. Adjusted for consolidation and currency effects,
advertising revenues within the Group increased by 6.4 %.
Advertising revenues as a proportion of total revenues
were 67.6 % (PY: 64.0 %). Of the total advertising reve-
nues, 84.8 % were generated by digital activities.
The decrease in circulation revenues of 10.4 %, from
€ 721.7 million to € 646.9 million, was particularly due to
consolidation effects. Adjusted for consolidation and
currency effects, they were only 3.5 % below the prior-
year figure. Circulation revenues as a proportion of total
revenues still only accounted for 19.7 % (PY: 21.9 %).
Other revenues amounting to € 420.2 million were
9.8 % below the prior-year figure (€ 465.7 million). Con-
solidation and currency effects likewise had an impact.
Adjusted for these effects, they showed an increase of
5.0 %. Overall, other revenues represented a share of
12.8 % (PY: 14.1 %) of total revenues.
Financial performance of the Group
During the reporting year, revenues were
€ 3,290.2 million, and thus on par with the prior-year level
(€ 3,294.9 million). An increase in revenues in the Classi-
fied Ad Models was offset by declines in the other seg-
ments. The organic growth in revenues showed a positive
picture - adjusted for consolidation and currency effects,
revenues increased by 4.1 %.
Organic revenue development for digital media is
illustrated in the table below. Consolidation and curren-
cy effects have been adjusted.
Revenue Development Digital Media, Organic
yoy
Digital Media
Classified Ad Models
Paid Models
Marketing Models
2016
10.7 %
12.5 %
14.7 %
7.5 %
Adjusted for consolidation and currency effects, organic
growth in revenues for digital media was at 10.7 %. Paid
Models showed the highest organic growth in revenues
with 14.7 %, followed by Classified Ad Models with 12.5 %
and Marketing Models with 7.5 %.
The pro-forma revenue development for digital
media is illustrated in the following table:
Revenue Development Digital Media, pro forma
yoy
Digital Media
Classified Ad Models
Paid Models
Marketing Models
2016
7.7 %
10.0 %
13.2 %
2.8 %
26
Annual Report 2016
Axel Springer SE
Combined Management Report
Economic Report
Other operating expenses were € 851.2 million and
slightly below the prior-year level (PY: € 862.2 million).
Effects of the first-time inclusion of subsidiaries were
compensated for by deconsolidation effects.
Income from investments amounted to € 40.2 million
(PY: € 24.7 million) and was influenced, in particular, by
the effects from the contribution of our interests in
Thrillist and NowThis into the new non-controlling interest
in Group Nine Media. The operating income from in-
vestments included in EBITDA amounted to € 18.7
million (PY: € 3.8 million) and was above the prior-year
level, particularly due to the establishment of Ringier Axel
Springer Schweiz AG.
The financial result was € – 21.4 million and slightly
above the prior-year level (PY: € – 22.2 million).
Income taxes amounted to € – 126.1 million (PY:
€ –136.2 million) during the past financial year. The tax
rate of 21.9 % (PY: 30.9 %) was influenced, in particular,
by the mostly tax-neutral income in connection with
the establishment of Ringier Axel Springer Schweiz AG,
as well as the lower-taxed income from the sale of
CarWale.
EBITDA rose by 6.5 % to € 595.5 million compared to
the prior year (PY: € 559.0 million). The generated EBITDA
margin increased to 18.1 % (PY: 17.0 %). The EBITDA of
digital activities increased by 10.1 % from € 428.7 million
to € 472.1 million. Based on the operating business, the
digital business share in EBITDA was 72.5 % (PY: 69.6 %).
Due to an increase in depreciation and amortization, as well
as write-ups captured in the prior-year period, EBIT in-
creased by 4.9 % compared with the prior year to € 471.1
million (PY: € 449.0 million).
Other operating income of € 339.9 million was signifi-
cantly above the prior-year level (PY: € 271.8 million). In
addition to income relating to the establishment of Ringier
Axel Springer Schweiz AG (€ 102.2 million), as well as the
sale of CarWale (€ 83.3 million), the reporting period also
includes income from the disposal of our real estate in
Hamburg (€ 71.3 million). The previous year was charac-
terized, in particular, by the sale of Runtastic and the
Smart-AdServer Group.
Changes in inventories and internal costs capital-
ized increased to € 82.6 million (previous year:
€ 47.3 million) in the reporting year, mainly related to
extensive IT development projects to develop and ex-
pand our digital business models.
Compared with the prior-year period, total expenses
decreased by 0.6 % to € 3,155.5 million (PY: € 3,175.7
million).
The decline in purchased goods and services of
4.1 % to € 971.5 million (PY: € 1,013.5 million) resulted,
in particular, from company disposals in the prior year,
as well as from the deconsolidation of our business in
Switzerland during the reporting period. Effects from the
first-time inclusion of subsidiaries were mostly compen-
sated for by circulation-related declines in the print busi-
ness. The ratio of purchased goods and services to total
revenues decreased to 29.5 % (PY: 30.8 %).
Personnel expenses were € 1,100.1 million and on par
with the prior-year level (PY: € 1,100.3 million). Lower
restructuring costs and a reduction of personnel in the
print sector were offset by an increase in personnel in the
digital business models segment and a heightening effect
on total amounts resulting from the acquisition and sale of
subsidiaries. The average number of employees in-
creased by 2.0 % in 2016.
Depreciation, amortization, and impairments
amounted to € 232.6 million and were above the prior-
year figure of € 199.8 million, due to consolidation relat-
ed increases in depreciation, amortization and impair-
ments from purchase price allocations, as well as higher
investments in intangible assets.
27
Annual Report 2016
Axel Springer SE
Combined Management Report
Economic Report
Net income from continuing operations developed as
follows:
€ 0.0 million) in connection with the new Executive Board
remuneration program were adjusted for the first time.
Net Income1)
€ millions
Net income
2016
450.0
2015
Change
304.6
47.7 %
Non-recurring effects
– 234.6
– 98.9
−
Depreciation, amortization, and
impairments of purchase price
allocations
Taxes attributable to these
effects
Net income, adjusted2)
Attributable to non-controlling
interest
Adjusted net income2) from
continuing operations
attributable to shareholders of
Axel Springer SE
Earnings per share, adjusted
(in €)2) 3)
Earnings per share (in €)3)
108.3
84.9
27.6 %
– 23.8
299.9
– 11.3
−
279.3
7.4 %
40.4
58.3
– 30.8 %
259.5
220.9
17.4 %
2.41
3.94
2.22
2.50
8.5 %
57.5 %
1) Continuing operations see also notes to the consolidated financial statements under
note (2d).
2) Further explanations regarding relevant key performance indicators on page 35.
3) Calculation based on average weighted shares outstanding in the reporting period
(107.9 million; PY: 99.7 million).
Non-recurring effects mainly included income from the sale
or contribution of business activities and real estate of
€ 290.9 million (PY: € 79.1 million), particularly in connec-
tion with the establishment of Ringier Axel Springer
Schweiz AG, the sale of CarWale, as well as the disposal of
the remaining part of the office building complex at the
Hamburg site (PY: particularly the sale of Runtastic). In
addition, this included expenses from the subsequent
valuation of contingent considerations from options for the
acquisition of non-controlling interests of € – 29.7 million
(PY: income of € 9.2 million), as well as other effects from
initial consolidations of € – 20.0 million (PY: € 14.3 million),
which were primarily the result of incidental acquisition
costs and consequences from purchase price allocations.
In the prior year, revaluation effects from existing non-
controlling interests held prior to the acquisition of a majori-
ty shareholding had been included furthermore. As well as
impairments of investments to the amount of € – 3.0 million
(PY: € –3.6 million), expenses of € – 3.5 million (PY:
Net income attributable to non-controlling interest de-
creased due to the increase in our share of the Axel
Springer Digital Classifieds Group completed in December
2015. By issuing 8,955,311 new Axel-Springer shares in
relation to this, the earnings per share were determined
on the basis of 107.9 million outstanding shares
(PY: 99.7 million).
Financial performance of the operating
segments
Classified Ad Models
All Business models which predominantly generate their
revenues in online classified advertising are summarized
in the Classified Ad Models segment. The segment is
sub-divided into jobs, real estate, and general/other.
Key Figures Classified Ad Models
€ millions
Revenues
Advertising revenues
Other revenues
Jobs
Real Estate
General/Other
EBITDA1)
Jobs
Real Estate
General/Other
2016
879.5
858.5
20.9
410.0
270.7
198.8
354.6
175.8
121.5
64.9
2015
Change
753.1
16.8 %
730.7
17.5 %
22.4
– 6.5 %
360.7
13.7 %
231.0
17.2 %
161.4
23.1 %
305.0
16.3 %
157.4
11.7 %
107.1
13.4 %
49.5
31.2 %
EBITDA margin
40.3 %
40.5 %
Jobs
Real Estate
General/Other
42.9 %
43.7 %
44.9 %
46.4 %
32.7 %
30.7 %
1) Segment EBITDA includes non-allocated costs of € 7.6 million (PY.: € 9.0 million).
28
Annual Report 2016
Axel Springer SE
Combined Management Report
Economic Report
In the year under review, the Classified Ad Models seg-
ment reported revenues of € 879.5 million and a year-
on-year increase of 16.8 % (€ 753.1 million) achieving
the largest increase in revenues of all segments. Along-
side an improvement in operative revenues, particularly
from job portals, consolidation effects, amongst others,
had an influence due to the incorporation of Immowelt,
Land & Leisure and Traum-Ferienwohnungen. Adjusted
for consolidation and currency effects, revenue growth
came to 12.5 %.
EBITDA for the segment increased significantly by 16.3 %
to € 354.6 million (PY: € 305.0 million). EBITDA was also
affected by consolidation effects. Adjusted for these and
currency effects, the increase was 11.5 %. The return of
40.3 % reached almost the prior-year figure (40.5 %). Ex-
penditure on technological developments and marketing,
as well as the inclusion of acquired subsidiaries, whose
return is currently below the average for the segments, was
offset by increases in earnings due to higher revenues.
EBIT in the Classified Ads segment rose by 15.5 % from
€ 275.1 million to € 317.6 million. The depreciation,
amortization and impairments rose by 23.6 % to
€ 37.0 million (PY: € 29.9 million).
Paid Models
The national sub-segment of the Paid Models segment
mainly comprises the BILD and WELT groups and in the
international sub-segment the content based, increasing-
ly digitized, media models, as well as analog models in
Europe and the USA.
Paid Models National
The circulation and reach figures for selected print offer-
ings in the Paid Model segment as well as the associated
online portals are shown in the following table:
Circulation, Digital Subscriptions, and Reach
Thousands
Bild/B.Z.
Circu-
lation/
Digital-
Subs1) Change
Reach2) Change3)
1,927.0
– 10.7 %
9,968.4
– 4.2 %
Bild am Sonntag
994.7
– 7.8 %
9,050.6
7.3 %
bild.de (total)
327.8
16.7 %
19,530.0
0.5 %
bild.de (stationary)
bild.de (mobile)
-
-
-
-
14,769.0 – 11.2 %
11,154.0
39.7 %
Die Welt/
Welt Kompakt
Welt am Sonntag/
Welt am Sonntag
Kompakt
181.2
– 7.3 %
704.0
4.5 %
381.6
– 4.8 %
1,028.8
12.4 %
welt.de (total)
75.6
12.7 %
15,008.0
2.1 %
welt.de (stationary)
welt.de (mobile)
-
-
-
-
9,650.0
– 6.3 %
7,568.0
16.6 %
1) Source: IVW, average paid circulations 2016; For bild.de (total)/welt.de (total): IVW,
digital subscriptions (paid content), monthly average 2016.
2) Source: ma 2017 Pressemedien I; For bild.de/welt.de: AGOF 2016 – 10, Unique Users.
3) Compared to ma 2016 Pressemedien I; For bild.de/welt.de compared to AGOF
2015 – 10
The focus of the national digital Paid Models remained to
sign up paying subscribers in the area of stationary Inter-
net. For this purpose, among others, marketing cam-
paigns with exclusive events were carried out for sub-
scribers of digital paid models from BILDplus and
WELTplus. Both BILDplus and WELTplus showed a clear
increase in the number of subscribers to digital offers.
29
Annual Report 2016
Axel Springer SE
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Economic Report
In the financial year 2016, circulation numbers of the
print media in the Paid Models segment declined in line
with market conditions, while the reach of the BILD and
WELT brands increased overall.
Paid Models International
The reach of the business portal Business Insider, circu-
lation and reach figures for the selected mass-circulation
dailies within the Eastern European countries of Ringier
Axel Springer Media as well as the net reach of the cor-
responding online portals are presented in the table
below:
Circulation and Reach
Thousands
Business Insider (total)
Business Insider (USA)
Business Insider
(USA, stationary)
Business Insider
(USA, mobile)
onet.pl
Fakt4)
fakt24.pl
Blikk5)
blikk.hu
Blic6)
blic.rs
Circu-
lation Change
Reach Change
-
-
-
-
-
- 78,367.51)
15.9 %
- 48,190.22)
16.1 %
- 16,052.92)
4.1 %
- 35,330.22)
24.4 %
- 13,861.73)
– 9.5 %
281.6
– 8.5 %
1,588.8
5.6 %
-
-
2,873.83) – 27.2 %
114.0
– 11.0 %
661.8
– 11.3 %
-
-
1,051.03)
40.3 %
83.2
– 14.5 %
459.1
– 34.1 %
-
-
2,509.13)
– 9.6 %
1) Source: comScore USA, own estimates, monthly average (Jan-Dec 2016).
2) Source comScore USA, monthly average (Jan-Dec 2016).
3) Source comScore Europa, monthly average (Jan-Dec 2016).
4) Poland. Circulation: ZKDP, 2016 (Jan-Dec) vs. 2015 (Jan-Dec); Reach: PBC
General, 2016 (Jan-Nov) vs. 2015 (Jan-Nov).
5) Hungary. Circulation: MATESZ, 2016 (Jan-Dec) vs. 2015 (Jan-Dec); Reach:
Millward Brown, TNS, 2016 (Jan-Jun) vs. 2015 (Jan-Jun).
6) Serbia. Circulations: ABC, 2016 (Jan-Dec) vs. 2015 (Jan-Dec); Reach: Ipsos
Strategic Marketing, 2016 (Jan-Nov) vs. 2015 (Jan-Nov).
In 2016, Business Insider saw significant growth in its
reach, driven predominantly by very strong growth in its
mobile reach. There is no comparable data for mobile
reach development for the net reaches of the online
portals in other European countries shown in the table.
As a result, the table does not reflect the dynamic
growth for these portals based on the increasing use of
mobile terminal devices. However, this is of great im-
portance to some of our digital activities. The circulation
and reach figures of our international print media by and
large declined in line with market conditions.
Key Figures Paid Models
€ millions
Revenues
2016
2015
Change
1,481.6
1,582.2
– 6.4 %
Advertising revenues
Circulation revenues
Other revenues
617.2
646.8
217.7
652.1
– 5.3 %
721.3
– 10.3 %
208.8
4.2 %
National
1,142.4
1,169.7
– 2.3 %
Advertising revenues
Circulation revenues
Other revenues
International
Advertising revenues
Circulation revenues
Other revenues
EBITDA
National
International
441.0
539.6
161.8
339.2
176.2
107.2
55.8
465.5
– 5.3 %
559.5
– 3.6 %
144.7
11.9 %
412.5
– 17.8 %
186.6
– 5.6 %
161.8
– 33.7 %
64.2
– 13.1 %
214.4
223.2
– 3.9 %
178.0
170.7
4.3 %
36.3
52.5
– 30.8 %
EBITDA margin
14.5 %
14.1 %
National
International
15.6 %
14.6 %
10.7 %
12.7 %
30
Annual Report 2016
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Economic Report
Revenue in the Paid Models segment decreased by 6.4 %
to € 1,481.6 million (PY: € 1,582.2 million). This is pri-
marily attributable to the deconsolidation of the Swiss
activities, which have been run in a jointly founded com-
pany with Ringier in Switzerland since the beginning of
2016. Adjusted for consolidation and currency effects,
revenues were only slightly below the prior-year figure
(–1.6 %). Advertising revenues in the Paid Models seg-
ment were € 617.2 million, which is 5.3 % below the
value of the prior-year period (€ 652.1 million). Deconsol-
idation effects from the Swiss business had the greatest
impact, which were primarily offset by growth based on
the consolidation of Business Insider and eMarketer.
Adjusted for consolidation and currency effects, the
decline was reduced to –3.2 %. Circulation revenues
decreased by 10.3 % to € 646.8 million (PY: € 721.3
million). Here also, deconsolidation effects from the
Swiss business were the primary factor, compensated
partially by growth mainly resulting from the consolidation
of eMarketer. Adjusted for consolidation and currency
effects, the decrease was only –3.4 %. Other revenues
increased by 4.2 % to € 217.7 million (PY: € 208.8 mil-
lion). Adjusted for consolidation and currency effects, the
increase was even higher and came to 9.4 %.
As planned, we invested in the expansion of our digital
activities in the Paid Models segment during the past
financial year. Expenses for the development of new
business were € 34.8 million and significantly above the
prior-year figure (€ 12.4 million). This was mainly due to
the expansion of the business of Business Insider and the
development of upday. Despite the expenses incurred for
this, the EBITDA of € 214.4 million was only 3.9 % below
the prior-year figure (€ 223.2 million). Among other fac-
tors, a decrease in restructuring expenses from € 34.8
million to € 18.3 million contributed towards this. Adjust-
ed for the expenses for Business Insiders and upday, as
well as the consolidation effects due to the inclusion of
eMarketer, the EBITDA of the Paid Models was slightly
above the prior-year figure. The segment's earnings in the
year under review were at 14.5 % (PY: 14.1 %).
EBIT in the Paid Models segment fell by 4.5 % from
€ 189.4 million to € 180.9 million. Depreciation, amortiza-
tion and impairments decreased slightly by 0.8 % from
€ 33.8 million to € 33.5 million.
Marketing Models
In the Marketing Models segment, idealo, aufeminin and
the Bonial Group, among others, are pooled in the
reach-based marketing segment, whereas performance-
based marketing consists of the zanox Group.
Key Figures Marketing Models
€ millions
Revenues
Advertising revenues
Other revenues
Reach Based Marketing
Performance Marketing
EBITDA1)
Reach Based Marketing
Performance Marketing
2016
856.2
747.4
108.7
288.7
567.4
82.2
65.5
25.5
2015
Change
878.9
– 2.6 %
725.1
3.1 %
153.8
– 29.3 %
298.2
– 3.2 %
580.7
– 2.3 %
88.0
– 6.6 %
73.6
– 11.1 %
25.0
1.9 %
EBITDA margin
9.6 %
10.0 %
Reach Based Marketing
22.7 %
24.7 %
Performance Marketing
4.5 %
4.3 %
1) Segment EBITDA includes non-allocated costs of € 8.7 million (PY: € 10.6 million).
The decline in total revenues in the segment
Marketing Models of 2.6 % to € 856.2 million (PY:
€ 878.9 million) is solely attributable to consolidation
effects, primarily due to the sale of Talpa Germany and
Smart AdServer concluded in the prior year, as well as
the divestment of Smarthouse Media during the report-
ing year. Adjusted for consolidation and currency effects,
total revenues rose by 7.5 %. The increase in advertising
revenues of 3.1 % to € 747.4 million (PY: € 725.1 million)
was achieved by growth in reach-based marketing,
particularly in idealo, in the aufeminin group as well as in
Bonial. Adjusted for consolidation and currency effects,
the increase was 8.0 %. The decline in other revenues by
31
Annual Report 2016
Axel Springer SE
Combined Management Report
Economic Report
29.3 % to € 108.7 million (PY: € 153.8 million) was also
caused by the aforementioned deconsolidation effects.
Adjusted for consolidation and currency effects, other
revenues increased by 4.0 %.
EBITDA in the segment was € 82.2 million and 6.6 %
below the figure for the previous year (€ 88.0 million).
The decline is primarily attributable to consolidation and
currency effects. Adjusted for these effects, EBITDA was
slightly higher (+ 0.7 %) than the value in the previous
year. The launch costs were € 17.8million and above the
prior-year figure of € 15.1 million. The EBITDA margin
decreased slightly to 9.6 % (PY: 10.0 %).
EBIT in the Marketing Models segment declined by
10.6 % from € 75.3 million to € 67.4 million. Depreciation,
amortization and impairments in the reporting period
increased by 17.3 % to € 14.8 million (PY: € 12.6 million).
Services/Holding
Group services, which also include the three domestic
printing plants, as well as holding functions, are reported
within the Services/Holding segment. The Group ser-
vices are purchased by internal, Group-wide customers
at standard market prices.
Key Figures Services/Holding
€ millions
Revenues
2016
72.9
2015
Change
80.7
– 9.7 %
EBITDA
– 55.7
– 57.1
Total revenues in the Services/Holding segment of
€ 72.9 million in 2016 were down by 9.7 % compared
with the prior-year figure (PY: € 80.7 million) due to mar-
ket conditions.
EBITDA improved slightly from € – 57.1 million in the
prior-year to € – 55.7 million.
EBIT in the segment Services/Holding was € – 94.8
million (PY: € – 90.8 million). The depreciation, amortiza-
tion and impairments amounted to € 39.0 million and
were above the prior-year figure (€ 33.7 million).
Liquidity
Financial management
As a general rule, Axel Springer SE 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 in the form of maturity-
matched financing.
Net Liquidity/Debt
€ millions
Cash and cash equivalents1)
Financial liabilities
Net liquidity/debt2)
2016
224.1
2015
186.3
1,259.3
1,252.9
– 1,035.2
– 1,066.6
1) In 2015, without the purchase price received in connection with real estate sales
amounting to € 67.5 million, attributable to the plan assets created for our pension
obligations.
2) Further Explanations with respect to the relevant key performance indicators on
page 35.
In addition to the Schuldschein (promissory note) of
€ 580.5 million (December 31, 2015: € 637.0 million), with
a term to April 2018 (nominal value of € 112.0 million), to
October 2018 (nominal value of € 220.0 m) and to October
2020 (nominal value of € 248.5 m), there are credit lines in
the amount of € 1,500.0 million, the utilization of which is
due for repayment in July 2020. Both the Schuldschein
and the credit facilities may be used either for general
business purposes or for financing acquisitions. As
of December 31, 2016, € 680.0 million (December 31,
2015: € 618.0 million) of the existing long-term credit facili-
ty (€ 1,500.0 million) was taken as a drawdown. Short-term
and long-term credit facilities that were not utilized
amounted to € 840.0 million as of the balance sheet date
(December 31, 2015: € 902.0 million).
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Economic Report
Cash flow development
Consolidated Statement of Cash Flows (Condensed)
€ millions
Cash flow from operating activities
2016
358.8
2015
369.6
Cash flow from investing activities
– 94.3
– 546.4
Cash flow from financing activities
– 299.9
51.1
Change in cash and cash equivalents
– 35.4
– 125.8
Cash and cash equivalents as of
December 31
224.1
253.8
Cash flow from operating activities amounted to
€ 358.8 million during the reporting period and despite the
positive development of earnings it was slightly below the
value of the prior-year period (€ 369.6 million). This devel-
opment was due, in particular, to an increase in trade
receivables, higher payments from long-term remuneration
programs and higher restructuring payments.
Cash flow from investing activities amounted to
€ – 94.3 million (PY: € – 546.4 million) and was charac-
terized in particular by payments (less cash and cash
equivalents acquired) for the acquisition of shares in
consolidated subsidiaries and business units (mainly
eMarketer Inc., Land & Leisure A/S, and exercise of the
option rights to acquire the remaining non-controlling
interests in Car&Boat Media), by the premature repay-
ment of the vendor loan granted to the FUNKE Medien-
gruppe (€ 247.9 million), as well as by the purchase
price from the sale of our shares in CarWale
(€ 64.0 million). In addition to the continued increase in
current investments in intangible assets and property,
plant and equipment, payments relating to the sale of
2.3 % of our shares in Do⁄an TV Holding (€ 55.3 million)
and payments in connection with the sale of the remain-
ing part of the office building complex in Hamburg
(€ 80.5 million) were also included. The previous year
was characterized in particular by payments for the ac-
quisition of Business Insider, Immowelt, @Leisure and
Thrillist, as well as proceeds from the sales of Runtastic,
Smart AdServer and 2.7 % of our shares in Do⁄an TV.
Also included in the previous year were payments allo-
cated to Axel Springer from the purchase price of the
sale of real estate assets completed at the beginning of
2016. The discontinued operations (see notes to the
consolidated financial statements, note (2d))
accounted for € 3.2 million (PY: € 8.1 million).
The cash flow from financing activities of € -299.9 million
(PY: € 51.1 million) was due in particular to the payment
of dividends to shareholders of Axel Springer SE, as well
as to the transfer to the plan assets of the purchase
price (€ 67.5 million) received in the previous year from
the sale of real estate completed at the beginning of
2016. The previous year was also characterized by the
borrowing of financial liabilities in connection with the
acquisitions that were made.
Financial position
Consolidated Statement of Financial Position (Condensed)
€ millions
Non-current assets
Current assets
Assets
Equity
Non-current debt
Current debt
Equity and liabilities
12/31/2016 12/31/2015
5,393.0
5,187.2
1,063.2
1,317.4
6,456.2
6,504.7
2,638.6
2,511.5
2,427.2
2,455.5
1,390.4
1,537.8
6,456.2
6,504.7
The increase in long-term assets resulted primarily from
the increase in intangible assets of € 265.3 million, which
was mainly attributable to the first-time consolidation of
eMarketer Inc. and Land & Leisure, which were acquired
during the reporting year. At the same time, financial
assets were reduced by € 99.4 million.
At the end of April, the FUNKE Mediengruppe prema-
turely repaid the vendor loan, including capitalized inter-
est, which was granted in 2014 in connection with the
sale of our German regional newspapers, TV program
guides as well as women’s magazines. The loan was
accounted for under other financial investments to the
amount of € 247.9 million, including capitalized interest.
In addition, financial assets decreased by € 55.3 million
as a result of the sale of 2.3 % of our shares in Do⁄an TV
on the exercise of a further put option.
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At the beginning of January 2016, the joint establishment
with Ringier of the company Ringier Axel Springer
Schweiz AG, to which we contributed assets of
€ 176.7 million as well as liabilities of € 66.0 million, was
completed. The assets and liabilities reported as held for
sale in the previous year were derecognized. In return,
we recognized an investment in Ringier Axel Springer
Schweiz AG of € 140.2 million, a receivable from related
parties from the disposal of the Swiss trademarks of
€ 40.6 million, as well as other contractual claims and
obligations totaling € -16.9 million. The currency transla-
tion differences previously recognized in equity to the
amount of € 49.0 million were recognized to profit and
loss. The transaction resulted in a total and largely tax-
exempt income from the disposal of € 102.2 million.
Furthermore, the sale of our subsidiary CarWale was
completed in January 2016. We received a purchase
price (after deducting taxes) of € 64.0 million. Assets of
€ 20.7 million and liabilities of € 21.8 million were decon-
solidated and therefore no longer disclosed as held for
sale. The profit resulting from the disposal totaled
€ 83.3 million (before tax of € 17.1 million).
A part of the office building complex that was previously
used as well as rented out at the Hamburg location was
sold as of January 1, 2016. The remaining carrying
amount of € 105.2 million, as well as the associated
liability of finance lease of € 67.7 million were derecog-
nized. No gain or loss on disposal was recorded. The
proceeds received in the previous year and recognized
as obligation from down payments in the amount of
€ 115.6 million were realized. The portion of the pur-
chase price received, which was attributable to the plan
assets formed for our pension obligations (€ 67.5 million),
was transferred to the plan assets in January 2016. The
remaining part of the office building complex was sold at
the beginning of August 2016 for a purchase price of
€ 80.5 million. The income from disposal (before taxes of
€ 22.1 million) amounted to € 71.3 million.
The development of current assets was, in addition to the
reduction in assets held for sale, due to the increase in
trade receivables mainly in connection with the compa-
nies acquired in the reporting year and the partly com-
pensatory slight decrease in cash and cash equivalents.
The increase in equity was mainly the result from the gen-
erated net income. In addition to the distribution of divi-
dends to shareholders of Axel Springer SE and other
shareholders, the effects of currency translation of consoli-
dated financial statements as well as the recognition of
actuarial losses due to a reduction in the discount rate in
the pension accounting following the current market level,
which also resulted in an increase in provisions for pen-
sions, had a diminishing effect. The equity ratio increased
to 40.9 % (PY: 38.6 %).
The development of non-current debt was influenced by
the increase in provisions for pensions and the acquisi-
tion of companies, which led to an increase in financial
liabilities and deferred tax liabilities. The reclassification of
short-term option liabilities for the acquisition of non-
controlling interests had a diminishing effect to an
amount of € 72.8 million.
The decrease in short-term debt was due in particular to
the derecognition of the liabilities related to assets held
for sale in the previous year in connection with the for-
mation of Ringier Axel Springer Schweiz AG in the re-
porting year, the sale of our subsidiary CarWale and the
sale of the property in Hamburg as well as the purchase
price payments (€ 115.6 million) recorded in the previous
year and recognized as other liabilities. In addition, short-
term financial liabilities were reduced by the repayment of
the promissory note (€ 56.5 million) due in April 2016, as
well as other short-term provisions due to higher payouts
from long-term remuneration programs and declining
restructuring measures. The reclassification of short-term
option liabilities for the acquisition of non-controlling
interests contributed significantly to the increase to an
amount of € 72.8 million.
34
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Explanations with respect to the relevant
key performance indicators
In accordance with the International Financial Reporting
Standards (IFRS), the performance indicators used in this
Annual Report, EBITDA (earnings before interest, taxes,
depreciation, and amortization), EBITDA margin, EBIT
(earnings before interest and taxes), adjusted net income,
adjusted earnings per share, free cash flow, net debt/-
liquidity and equity ratio are undefined performance
indicators to be regarded as additional information.
EBITDA, EBITDA margin, EBIT, adjusted net income, and
adjusted earnings per share do not include any non-
recurring effects and amortization from purchase price
allocations or taxes on these effects. Non-recurring ef-
fects are defined as effects resulting from the acquisition
and disposal (including contribution) of subsidiaries,
business divisions, and investments (including effects
from the subsequent valuation of contingent considera-
tions and other option liabilities for the acquisition of non-
controlling interests), as well as impairments and write-
ups of investments, effects resulting from the sale of real
estate, impairments, and write-ups of real estate used for
own operational purposes. In addition, expenses in con-
nection with the long-term share-based Executive Board
remuneration program granted at the beginning of May
2016 have also been adjusted. Purchase price allocation
effects include the expenses of amortization, deprecia-
tion, and impairments of intangible assets, and property,
plant, and equipment from the acquisition of companies
and business divisions. The EBITDA margin is the ratio
between EBITDA to revenues. The reconciliation of net
income to EBITDA and EBIT is based on the Consolidat-
ed Segment Report. The financial performance of the
Group contains the reconciliation of net income to the
adjusted net income as well as the determination of the
adjusted earnings per share.
The free cash flow results from the cash flow from oper-
ating activities less investments in intangible assets,
property, plant and equipment, and investment property
(capital expenditures), plus payments received for the
disposal of intangible assets, property, plant and equip-
ment and investment property. These partial amounts
are stated separately in the Consolidated Statement of
Cash Flows. Net debt/liquidity is the balance of cash and
cash equivalents and financial liabilities.
The equity ratio reflects the ratio between equity and the
balance sheet total as of the respective balance sheet date.
We consider EBITDA, EBITDA margin, EBIT, adjusted
net income and adjusted earnings per share to be suita-
ble indicators for measuring the operational profitability of
Axel Springer, because these indicators ignore effects
that do not reflect the fundamental business perfor-
mance of Axel Springer.
To assess our Group’s current financing and capital
structure as well as the future financing volume, we
regard free cash flow, net debt/liquidity, and equity ratio
to be suitable performance indicators.
Non-financial performance indicators
Employees
Axel Springer had an average of 15,323 (PY: 15,023)
employees (excluding vocational trainees and journalism
students/interns) in the reporting period. The slight in-
crease of 2.0 % is mainly attributable to the inorganic and
organic personnel development in the Classified Ad Mod-
els and Marketing Models. Axel Springer employs an
average of 6,877 employees abroad (PY: 6,846); this
accounted for 44.9 % (PY: 45.6 %). On average, 6,668 of
the Group’s total workforce were women and 8,656
were men. The share of women increased to 43.5 % (PY:
41.9 %). The number of editors rose by an average of
5.8 % to 2,888 in the period under review, which is partly
attributable to Business Insider. The number of employ-
ees rose by 1.9 % to 11,797, mainly as a result of the
expansion of digital business activities and new invest-
ments.
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Economic Report
Personnel development
The training and continuing education activities of Per-
sonnel Development have been closely aligned with the
requirements of the digitization movement in prior years.
In addition to established seminars and support pro-
grams, the offering of shorter and unconventional for-
mats has in particular been greatly expanded, leading to
improved networking among individuals as well as the
pure transfer of knowledge. In this context, the collabo-
ration platform moveoffice (Office 365) was introduced at
Axel Springer in 2016. The networking, the simultaneous
and independent work in the team, an open communica-
tion as well as the sharing of knowledge are thus sup-
ported and promoted. In doing so, Personnel Develop-
ment is pursuing the objective of developing Axel
Springer into a permanent “learning organization” that is
able to stand up to change processes. With the Talent
Management Division Axel Springer invests in the devel-
opment and retention of employees with high potential.
Via network events and so-called talent dialogues on
divisional and management boards, the Group creates
transparency about talent, development opportunities
and vacancies within the Axel Springer family. The lever-
age of synergies, the exchange of knowledge between
the companies forming part of the Axel Springer family
as well as the communication of new knowledge content
and the guidance of the teams with regard to the intro-
duction of new working methods, such as agile process
work, are equally important.
Research and development
Axel Springer does not have a traditional research and
development department of the kind that industrial enter-
prises maintain. All areas of the company constantly strive
to optimize their existing products and introduce innova-
tive new products to the market. Above all, we seek to
continuously expand our portfolio with innovations in the
digital sector, besides continuously improving our editorial
content and upgrading our journalistic excellence. In that
regard, we pay especially close attention to identifying
changing media usage habits as early as possible.
Employees by Segments
Average number per year
Classified Ad Models
Paid Models
Marketing Models
Services/Holding
2016
4,005
6,981
2,640
1,697
2015
Change
3,660
9.4 %
7,013
– 0.5 %
2,505
5.4 %
1,844
– 8.0 %
Group
15,323
15,023
2.0 %
The increase in the number of employees in the Classi-
fied Ad Models segment was mainly due to acquisitions
as well as organic growth. In the Marketing Models seg-
ment, the increase resulted from the growth of the zanox
group as well as from the growth of the reach-based
Marketing Models, particularly with regard to the Bonial
and idealo Group. The decrease in the Paid Models and
Services/Holding segment is primarily due to the reduc-
tion in headcount in the offset printing house, at Media
Impact and AS IT (infrastructure support).
Length of service and age structure
As of the reporting date in 2016, the average length of
service with Axel Springer was 10.1 (PY: 10.4) years;
43.8 % (PY: 41.8 %) of the workforce belonged to the
Group for more than ten years. More than half of all em-
ployees are between 30 and 49 years of age. The propor-
tion of severely disabled employees in German compa-
nies was, on average over the year, 3.7 % (PY: 3.7 %).
Equal opportunity and diversity
Axel Springer promotes the development of all its em-
ployees equally. Thus in 2010, Axel Springer launched a
new, Group-wide project entitled “Chancen:gleich!” to
increase in particular the proportion of women in man-
agement positions and to achieve a more balanced
relationship between female and male executives. As of
December 31, 2016, the average proportion of women
among executives in the company was 31 %. Thus, the
originally set goal of doubling the proportion of women in
management positions from 16 % in 2010 to more than
30 % by 2018 was prematurely achieved. Successful
initiatives and offers of the “Chancen:gleich” project are
being continued and expanded to further strengthen
diversity and equal opportunities.
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Economic Report
Further development of Classified Ad Models
The development of new offerings also applies to the
Classified Ad Models segment.
The core technology of the StepStone platform, the so-
called Search & Match algorithm, is continually being
developed and implemented consistently with newly
acquired companies. StepStone has also introduced
functionalities for the assessment of employers and
salaries and thus further increased the relevance for the
applicants. With Good&Co, StepStone has taken over a
company that has developed a personality test via App.
The algorithm behind this app is designed to help the
user in all phases of job search, from the identification of
their own strengths to the search for the ideal company.
Yad2, our generalist portal in Israel, has implemented
high-quality 3D and virtual reality tours for its real estate
sector. These offer a complete visualization of the re-
spective property. The new offerings enable potential
buyers to look around virtually in their future property.
Real estate developers can use the service to market
new construction projects in an even shorter time and at
a lower cost.
Further development of Paid Models
The existing platforms for paid content were also sys-
tematically expanded during the financial year. Improve-
ments in the registration process (“Single Sign On”),
integration of additional sales agreements and the tech-
nical processing of subscription transactions (buying
process, cash, postprocessing, etc.) were implemented.
In addition, FUSSBALL BILD was tested as an innovative
content syndication model in two cities and launched in
January 2017 in Germany.
Moreover, Business Insider launched in cooperation with
Finanzen.net (Segment: Marketing Models) in the US the
offer Markets Insider with real-time financial market data.
Further development of Marketing Models
In the Marketing Models, existing online offers were
continuously developed and supplemented by new ones.
Development of innovative product functionalities and
marketing technologies for increasing reach and use of
offers as well as monetization is a key priority for our
investments. In addition, we also invest in new compa-
nies in an early stage of development, which develop
new business models and technologies. This is either as
a direct investment, or indirectly via investment compa-
nies such as the Project A-Ventures, where Axel Springer
and the Otto Group are both involved, or Axel Springer
Plug & Play Accelerator GmbH, a joint venture with Plug
& Play Tech Center in Silicon Valley.
Sustainability and social responsibility
For Axel Springer, sustainability is the nexus between
economic success and conduct that is both environmen-
tally responsible and socially fair. These three criteria are
firmly anchored in the company’s business strategy.
Therefore, sustainability is an integral part of all the com-
pany’s business processes. The Sustainability Depart-
ment supports all the company’s activities in this area –
ranging from resource efficiency measures to social
responsibility initiatives. This department reports directly
to the Executive Board Chairman. Through our sustaina-
bility strategy, we exercise responsibility for current and
future generations and establish the foundation for long-
term business success. Since the mid 1990s Axel
Springer has published environmental reports, and sus-
tainability reports have been published since 2000. Since
2005 we have published a sustainability report on a
biannual basis, which follows the full list of indicators of
the Global Reporting Initiative (GRI), the internationally
relevant format for sustainability reporting. The Sustaina-
bility Report 2014/2015 was drawn up “in accordance”
with the new G4 guidelines and the “core” option of the
Global Reporting Initiative (GRI).
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We continue to believe that the path of systematic digiti-
zation is the right strategy for assuring and further im-
proving the company’s profitability in the future.
Financial performance, liquidity, and financial position
Group Key Figures (in € millions)
2016
2015
Revenues
EBITDA1)
EBITDA margin1)
EBIT1)
Tax rate
Net income2)
Net income, adjusted1) 2)
Earnings per share, adjusted (in €)1) 2) 3)
Dividend per share (in €)4)
Total dividends4)
Net debt/liquidity1) 5)
Free cash flow1)
3,290.2
3,294.9
595.5
559.0
18.1 %
17.0 %
471.1
449.0
21.9 %
30.9 %
450.0
299.9
2.41
1.90
304.6
279.3
2.22
1.80
205.0
194.2
– 1,035.2
– 1,066.6
270.5
299.8
1) Further explanations regarding relevant key performance indicators on page 35.
2) Continuing operations see also notes to the consolidated financial statements under
note (2d).
3) Calculation based on average weighted shares outstanding in the reporting period
(107.9 million; PY: 99.7 million).
4) The dividend for the financial year 2016 is subject to the condition of approval by
the annual shareholders’ meeting.
5) In 2015, without the purchase price received in connection with real estate sales
amounting to € 67.5 million, attributable to the plan assets created for our pension
obligations.
For the first time, the topics of the report were deter-
mined in advance by market research and interviews
with the stakeholders – those groups which have a legit-
imate interest in the company, be it employees, custom-
ers or non-governmental organizations. The result: In
particular, information about product responsibility, cus-
tomer satisfaction, journalistic independence, employer
attractiveness, and compliance with social and ecologi-
cal standards as well as the innovative ability of the
company was in demand. For the first time, the report
also provides cross-national data on the use of energy
and the resulting CO2 emissions. This was made possi-
ble by a new evaluation and registration method devel-
oped by the company itself.
Axel Springer’s sustainability reports are audited by
independent auditors. The current sustainability report
appeared in November 2016 and can be found at
www.nachhaltigkeit.axelspringer.de. The next sustaina-
bility report will appear in the middle of 2018.
General assessment of the company’s
financial performance, liquidity, and
financial position by the Executive
Board
The strategy of digital transformation was also at the fore
during the 2016 financial year. We have driven digitization
organically as well as via acquisitions. Important mile-
stones in this context were the acquisition of eMarketer
as well as acquisitions in the Classified Ad Models in the
field of vacation rentals. EBITDA, EBIT, and the adjusted
earnings per share from continuing operations were all
higher than in the previous year. At the end of the year,
the net debt was roughly at the level of the previous year.
With strong cash flow, a still solid balance sheet structure,
and the favorable financing options available to us, we
continue to be in a good position to make the necessary
investments to realize future growth.
38
Annual Report 2016
Axel Springer SE
Combined Management Report
Economic position of Axel Springer SE
Economic position of Axel Springer SE
€ millions
Revenues
Net income
Transfer to retained earnings
Total dividends1)
Dividend per share (in €)1)
2016
2015
2014
2013
2012
833.1
296.4
91.4
205.0
1.90
925.9
213.5
19.3
194.2
1.80
1,174.6
1,442.8
1,507.1
590.8
412.7
178.1
1.80
186.4
8.3
178.1
1.80
371.9
204.0
167.9
1.70
1) The dividend for the financial year 2016 is subject to the condition of approval by the annual shareholders’ meeting.
Introductory remarks
Financial performance
Axel Springer SE is the parent company of the Axel
Springer Group. Due to its subsidiaries, which Axel
Springer SE controls directly or indirectly, the business
development is subject to the same risks and opportuni-
ties as the entire group. These are presented in the re-
port on risks and opportunities (see page 42 ff.). Similarly,
the expectations regarding the development of Axel
Springer SE essentially correspond to the group expec-
tations described in the forecast report (see page 60).
The following explanations are based on the annual
financial statements of Axel Springer SE, which was
prepared in accordance with the provisions of the Ger-
man Commercial Code and the German Stock Corpora-
tion Act. The annual financial statements and manage-
ment report are published in the German Federal Gazette
and published on the Axel Springer SE website.
Business activity
Axel Springer SE is active in the Paid Models segment and
publishes mainly nationwide daily and weekly newspapers.
The magazine activities (automotive, computer and sports
magazines) were transferred to legally independent sub-
sidiaries as of January 1, 2016. Axel Springer SE, as the
parent company of the Axel Springer Group, carries out
holding functions, manages Group-wide liquidity man-
agement and provides additional services to Group com-
panies. The economic framework conditions of Axel
Springer SE correspond largely to those of the Group and
are described in the economic report (see page 22 ff.).
Income Statement (Condensed)1)
€ millions
Revenues
Other operating income
2016
833.1
139.5
2015
998.1
64.1
Purchased goods and services
– 208.5
– 272.9
Personnel expenses
– 203.9
– 266.8
Amortization, depreciation and
impairments of intangible assets and
property, plant and equipment
– 21.1
– 21.4
Other operating expenses
– 401.6
– 498.5
Net income from non-current financial
assets
Net interest income
Income taxes
Net income
233.2
– 30.1
– 44.2
296.4
279.6
– 28.5
– 40.2
213.5
1) As a result of the accounting regulation reforms under the Accounting Directive
Implementation Act (Bilanzrichtlinie-Umsetzungsgesetz – BilRUG), the prior-year
figures were restated to improve comparability with the amounts for the year under
review. Revenues were increased by € 72.2 million, while the other operating in-
come was correspondingly reduced.
Revenues decreased by € 165.0 million and 16.5 %
respectively. There were reductions in the circulation and
advertising revenues of € 77.8 million and € 70.6 million
respectively and resulted in particular from the outsourc-
ing of the magazine activities and the structural devel-
opments in the print business. At the same time, these
were the main reasons for the decrease in purchased
goods and services and other operating expenses by
€ 64.4 million and € 96.9 million respectively.
39
Annual Report 2016
Axel Springer SE
Combined Management Report
Economic position of Axel Springer SE
Other operating income increased by € 75.4 million to
€ 139.5 million mainly as a result of the sale of the Ham-
burg office building complex.
Financial position
Balance Sheet (Condensed)
€ millions
12/31/2016 12/31/2015
Intangible assets and property, plant and
equipment
170.7
173.7
Non-current financial assets
5,435.2
5,398.8
Receivables from affiliated companies
186.0
151.6
Cash and cash equivalents
Other assets
Total assets
Equity
Provisions
17.8
98.8
36.4
97.1
5,908.5
5,857.6
2,565.8
2,463.6
266.7
327.1
Liabilities due to banks and promissory
note
1,260.6
1,255.0
Liabilities to affiliated companies
1,740.7
1,611.4
Other liabilities
74.7
200.5
Total equity and liabilities
5,908.5
5,857.6
Total assets rose by € 50.9 million to € 5,908.5 million
(PY: € 5,857.6 million). Non-current assets amounted to
€ 5,605.9 million (PY: € 5,572.5 million) and was 94.9 %
(PY: 95.1 %) of total assets. 45.8 % (PY: 44.2 %) was
covered by equity.
Non-current financial assets increased slightly by
€ 36.4 million in the year under review to € 5,435.2 million.
Additions based on loans granted and payments to the
capital reserves of subsidiaries for the financing of acquisi-
tions were almost identical to the amount of the premature
repayment (€ 269.6 million including accrued interest) of
the vendor loan in connection with the sale of German
regional newspapers and the TV program guides and
women's magazines in the 2014 financial year.
At € 203.9 million, personnel expenses were down 23.6 %
year on year. This was due in particular to the lower
number of employees, which fell by 14.8 % from an
average of 1,861 in the previous year to 1,586 in the
2016 financial year. There were also lower expenses for
old age pensions and restructuring measures.
Amortization, depreciation and impairments of intangible
assets and property, plant and equipment remained
constant at € 21.1 million compared to the previous year.
Net income from non-current financial assets amounted
to € 233.2 million (PY: € 279.6 million) and included in
particular profit and loss transfers from subsidiaries in the
amount of € 207.5 million (PY: € 284.5 million), which in
the previous year contained higher profits from the sale
of investments. Depreciation on financial assets was
lower compared to the previous year and amounted to
€ 18.8 million (PY: € 54.9 million).
Net interest income was € – 30.1 million slightly below
the previous year's figure (€ – 28.5 million) and mainly
included interest expenses from the utilized credit line
and the promissory note as well as from the pension
accounting.
The annual net income for the year under review rose by
38.8 % or € 82.9 million respectively to € 296.4 million
(PY: € 213.5 million).
Liquidity
The net debt (liabilities due to banks and promissory note
less cash and cash equivalents) amounted to € 1,242.8
million as of December 31, 2016 (PY: €1,218.6 million).
€ 680.0 million (PY: € 618.0 million) of the existing long-
term credit lines (€ 1,500.0 million) were utilized. In addi-
tion, there were promissory notes of € 580.5 million (PY:
€ 637.0 million).
40
Annual Report 2016
Axel Springer SE
Combined Management Report
Economic position of Axel Springer SE
Receivables from affiliated companies and liabilities to
affiliated companies essentially resulted from the Group-
wide liquidity management and increased by € 34.4
million to € 186.0 million and € 129.3 million to
€ 1,740.7 million, respectively.
Shareholders' equity increased by € 102.2 million to
€ 2,565.8 million (PY: € 2,463.6 million). The decrease in
shareholders' equity as a result of the dividend for the
past financial year (€ 194.2 million) was overcompen-
sated by the net income for the year (€ 296.4 million).
The equity ratio increased to 43.4 % (PY: 42.1 %).
Provisions fell by € 60.4m compared with the previous
year's balance sheet date to € 266.7 million (PY:
€ 327.1 million). Decisive for the reduction were, in par-
ticular, lower pension provisions due to necessary ad-
justments to actuarial parameters as well as declining
obligations from performance-related remuneration,
share-based payment programs and structural measures.
Other liabilities decreased by € 125.8 million to
€ 74.7 million. In the previous year, prepayments related
to the sale of the Hamburg office building complex
(€ 115.6 million) were included.
Profit utilization proposal
The Supervisory Board and Executive Board propose
that the Company applies the full amount of the distrib-
utable profit of € 205.0 million (PY: € 194.2 million) to
pay a dividend of € 1.90 (PY: € 1.80) per qualifying share
for the 2016 financial year.
The company does not currently hold any treasury
shares, so that all the company’s shares qualify for divi-
dends. However, the number of shares qualifying for
dividends may be reduced in the time remaining before
the annual shareholders’ meeting. In that case, an ad-
justed profit utilization proposal will be submitted to the
annual shareholders’ meeting, without changing the
target dividend of € 1.90 per qualifying share.
Dependency Report
The Executive Board of Axel Springer SE submitted the
dependency report prescribed by section 312 of the
German Stock Corporations Act (Aktiengesetz – 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 SE received adequate consider-
ation 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.”
41
Annual Report 2016
Axel Springer SE
Combined Management Report
Report on risks and opportunities
Report on risks and opportunities
The general form of structures and processes in the risk
management system at Axel Springer are based on the
internationally recognized “Enterprise Risk Management
Framework”, a framework developed by the Committee
of Sponsoring Organizations of the Treadway Commis-
sion (COSO). This links the risk management process to
the internal control system. The use of this holistic, inte-
grated approach should ensure that countermeasures
and monitoring activities are systematically focused upon
the strategic, operative, reporting-related and compli-
ance-related objectives of Axel Springer and their risks.
To ensure close interlinking of individual subsystems in
the long term which results in an appropriate, effective
monitoring system for Axel Springer, Group-wide coordi-
nation of systems for risk management, compliance
management and the internal control system as well as
the related reporting is carried out by the Governance,
Risk & Compliance central division.
The risk management process at Axel Springer is inter
alia focused in accordance with Section 91 (2) of the
German Stock Corporations Act (AktG) on recognizing
and evaluating all significant and existential risks as well
as essential changes in the risk situation as promptly as
possible. It should therefore be assured in accordance
with risk policy principles and risk strategy that corre-
sponding control and countermeasures can be used in
time to react to such risks. This approach gives us the
necessary maneuvering room and allows for the con-
trolled and responsible management of risks.
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 targets or objectives, while opportunities
represent the possibility of positive deviations. The risk
policy principles and risk strategy of Axel Springer are
coordinated and closely aligned with the business strat-
egy and business objectives. We do not seek to avoid
risks at all costs, but to carefully weigh the opportunities
and risks associated with our decisions and our business
activities, from a well-informed perspective. Against this
backdrop, opportunities should be exploited to generate
income or increase the company’s value and risks
should be assumed only if they remain within appropriate
limits that are acceptable to the company. Thus, risks
should be limited to a level deemed acceptable by the
company’s management by taking appropriate
measures, be transferred to third parties in full or in part,
or, in those cases where risk mitigation is not considered
advisable, be avoided or monitored closely. All employ-
ees are duty-bound to handle risks responsibly within
their own area of responsibility.
Group-wide risk management system
Taking into account the various national and international
requirements, an increasingly complex and volatile envi-
ronment and a company that is growing and changing,
we still managed to develop further and expand certain
elements of internal corporate monitoring (Risk Man-
agement, Compliance Management, Internal Control and
Internal Audit) during this financial year as well. There
was particular focus on optimizing existing processes
and structures, and integrating new participations and
business areas into the existing risk management system.
We are also focused on ensuring the continuous im-
provement of the quality and completeness of the risk
inventory and the corresponding internal management
measures.
42
Annual Report 2016
Axel Springer SE
Combined Management Report
Report on risks and opportunities
The risks at Axel Springer are divided into strategic, opera-
tive, reporting-relevant, and compliance-relevant risks
based on the COSO framework (risk categories). Insofar it
is appropriate and quantifiable, risks are assessed quantita-
tively with reference to the parameters “loss amount” (im-
pact) and “probability of occurrence”. Based on these
parameters, risks are assigned to one of the following risks
classes: critical risks, significant risks, risks to be monitored,
and other risks. To achieve focus on the various risks that
are relevant and significant at a Group level, a materiality
limit is established based on EBITDA, and the classifica-
tions are determined from the depicted risk matrix. Current-
ly, the materiality limit at a Group level is € 10 million.
Risk Matrix of Axel Springer SE
Critical Risks
Significant Risks
Risks to be Monitored
Other Risks
very
high
50 %
high
25 %
medium
10 %
low
5 %
very
low
e
c
n
e
r
r
u
c
c
O
f
o
y
t
i
l
i
b
a
b
o
r
P
Extent of Damage (€ millions)
very
low
low
medium
high
very
high
0.5
2.5
5
10
A theoretical threat to the company’s survival as a going
concern is assessed by Axel Springer with reference to
the criterion of the gross loss amount and its impact on
the financial position and liquidity (excessive debts and
insolvency) at a Group level. The gross loss amount is
the impact of a risk prior to any risk management
measures being established.
To ensure the effective management and greatest possi-
ble transparency in the presentation of the risk position,
all identified risks are assessed both prior to the imple-
43
mentation of risk management measures (gross risk
assessment - inherent risk), and after the corresponding
measures are taken (net risk assessment - residual risk).
Whilst overall responsibility for risk management lies with
the full Executive Board, the operational management of
the individual risks falls primarily within the area of respon-
sibility of the respective company divisions or Axel Spring-
er investments. This includes the early detection and iden-
tification, assessment, definition of appropriate measures,
the management and monitoring of such measures and
adequate documentation and reporting processes.
The senior managers of Axel Springer and the manage-
ment of Axel Springer Group companies bear the re-
sponsibility for the content of the risk management sys-
tem implemented within their division or company and
the risks contained therein. As part of the so-called bot-
tom-up procedure, they are required to participate in the
update campaign that takes place every six months,
along with the systematic and standardized risk inventory
conducted once a year. They must also continuously
monitor any changing risk situations within their division
or company. Significant changes in the risk situation
must be reported immediately to the Corporate Office of
Governance, Risk & Compliance.
This decentralized risk inventory process is supplement-
ed by a centralized risk inventory within the top man-
agement group (top-down procedure), which is accom-
panied and moderated by the Governance, Risk &
Compliance central division.
The purpose of the risk inventories and analyses carried
out in the top-down and bottom-up procedures is to
systematically identify and assess cross-company,
cross-divisional and cross-procedural risks in order to
complete the risk inventory and ensure its quality. In the
Governance, Risk & Compliance division, risk manage-
ment activities are coordinated, risks are aggregated up
to the Group level, reported risks are checked in terms of
their plausibility, and the completeness of the required
risk reports is monitored. The division is also responsible
for compiling, updating and communicating the risk
management guidelines, as well as all supporting
Annual Report 2016
Axel Springer SE
Combined Management Report
Report on risks and opportunities
Report on the financial reporting related
risk management system and internal
control system pursuant to Section 289
(5) and Section 315 (2) (5) HGB
The (consolidated) financial reporting-related risk man-
agement system and the connected internal control
system are important elements of the internal manage-
ment system of Axel Springer SE, which is also based on
the internationally recognized framework of the Commit-
tee of Sponsoring Organizations of the Treadway Com-
mission (COSO) (see Page 42). As emphasized in the
concept, the effective interplay of the risk management
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 (consolidated)
financial reporting related risk management system and
internal control system comprise all organizational regu-
lations and measures aimed at the detection and man-
agement of risks related to financial reporting. With a
view to the (Group) accounting process, it is intended to
ensure that the Group’s financial reports convey a true
and fair view of the financial position, liquidity, and finan-
cial performance of Axel Springer SE and the Axel
Springer Group, in compliance with all relevant laws,
regulations, and standards. However, even an effective
and therefore adequate and well-functioning risk man-
agement system and internal control system cannot
guarantee the prevention or detection of all irregularities
or inaccurate disclosures.
measures, such as maintaining the risk management
software, the continuous further development of the
centralized risk management system and reporting to the
Supervisory Board and Executive Board.
The semi-annual and ad-hoc risk reports prepared for
the Executive Board and Supervisory Board focus pri-
marily on existential risks and significant risks of individu-
al business units and investments, along with the coun-
termeasures adopted and suitable early warning
indicators, to the extent they are available.
Internal audit system
Group Auditing within Axel Springer SE is organized as a
process-independent staff department, which is under the
control of the full Executive Board in functional terms, and
under the Executive Board member in charge of Personnel
and Finance in disciplinary terms. It provides consulting
and investigations in all Group companies and divisions in
a risk-oriented manner and aligns its activities with relevant
national and international professional standards.
In particular, Group Auditing has the task of inspecting
the effectiveness of the internal risk management and
control system as well as the compliance management
system based on a risk-oriented inspection plan and to
derive measures for eradicating weaknesses. Implemen-
tation of improvement measures is tracked based on a
systematic process.
The results of individual audit or consultancy mandates
are typically reported to the Executive Board and period-
ically summarized to the Audit Committee of the Super-
visory Board.
To ensure the effectiveness of the internal audit system,
a quality assurance and improvement process is set up,
which provides for external quality assessments among
others in accordance with professional guidelines.
44
Annual Report 2016
Axel Springer SE
Combined Management Report
Report on risks and opportunities
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:
Protection of financial reporting-related IT systems
against unauthorized access, by means of access
restrictions.
Processes for identifying, assessing, and document-
ing all significant financial reporting-related processes
and risk areas, including the corresponding key con-
trols. Such processes include financial and account-
ing processes, as well as administrative and opera-
tional business processes that generate important
information used in the preparation of the separate
and consolidated financial statements, including the
management reports of the parent company and the
Group.
Process-integrated controls (computer-aided controls
and access restrictions, dual control principle, separa-
tion of functions, analytical controls).
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.
Group-wide accounting directives in the form of ac-
counting guidelines, charts of accounts, and reporting
procedures.
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.
Assuring the requisite expertise of employees involved
in the financial accounting process by means of ap-
propriate selection procedures and training.
Centralized preparation of the consolidated financial
statements (including the management report), em-
ploying manual and computer-system controls in re-
spect of financial reporting-specific connections and
dependencies.
Monthly internal reports (complete income statement,
statement of financial position, cash flow statement)
and monthly reports on all cost units of the Group, in-
cluding analysis and reporting of significant develop-
ments and budget/actual variances.
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, Executive Board,
and Supervisory Board. As a process- independent staff
unit, Group Auditing will inspect at regular intervals ran-
domly selected elements of the accounting-related inter-
nal control system organized at central level and in the
Group companies, in order to uncover weaknesses and
thus contribute towards improving the legal conformity
with rules and regulations (compliance).
Both the risk management system and the internal con-
trol system are continuously refined. For example, the
financial reporting-related control system is being inte-
grated, extending beyond the area of accounting, on a
step-by-step basis into a comprehensive system of
internal corporate monitoring. Thus, we synchronize and
optimize our control elements on a cross-divisional basis,
thereby enhancing the effectiveness and economic effi-
ciency of the entire system.
Risk areas
If not stated elsewhere, all risks will be mentioned in the
following which have a considerable negative effect on
reaching our company-wide targets. Within the risk areas
described below, risks are typically presented in the
order of their priority for the Group. This method may be
deviated from in order to prevent repetitions and in the
interests of readability.
45
Annual Report 2016
Axel Springer SE
Combined Management Report
Report on risks and opportunities
The risks illustrated below are primarily based on the
2017 forecast period, unless the risks in question relate
to long-term objectives.
Market and competition risks
Axel Springer pursues the aim to become the leading
digital publisher. In doing so, consistently established
media brands are transformed into digital business mod-
els, market positions are expanded through organic
growth and additional targeted acquisitions are also
made. As a result, the economic and industry-specific
developments in many different regions are of key im-
portance to the financial performance of the Group, in
addition to the general global economic situation. Devel-
opments in the European Economic Area and the USA in
particular play a decisive role alongside the develop-
ments in Germany.
While the global economy as a whole appears to be on a
stabilizing path, only moderate to slightly friendly growth
forecasts are emerging for North America and Europe. For
Germany, we expect lower growth compared to the previ-
ous year, which is attributable to the global uncertainty,
caused by inter alia the unexpected outcome of the EU
referendum (Brexit vote) in Great Britain and the new US
government, as well as calendar effects. Even rising infla-
tion can contribute to a slowdown in the economy.
The European Union is faced with an increasing national
orientation in many countries and the prevalence of
populist tendencies before existential challenges. Con-
tinued high over-indebtedness of individual countries in
the Eurozone, as well as heavily burdened banks in
some instances, weaken confidence in the currency
union and have an impact on our core markets within the
European Union. Despite a growing global trend towards
digitization and the associated importance of digital
media, the above-mentioned economic-political frame-
work conditions pose a threat to the markets in which
we operate. The resulting potential reductions in reve-
nues affect all segments of the company at national and
international levels. Moreover, these developments could
lead to a slowdown in online market growth overall and
thus slow down our growth.
Digital technologies have long established themselves in
everyday life and are changing people, society and mar-
kets. The rapidly growing number of new media formats
and channels, fragmentation of the target group and the
increasing use of social media forces companies to
rethink their business models and respond to the far-
reaching developments of a digital world. While digital
transformation allows for innovations that offer good
growth opportunities, it also poses a threat to traditional
business models.
Digitization has thus significantly altered consumption
and reading habits. The increased importance and use of
digital services, increasingly on mobile end devices,
continues to lead to persistent reductions in the print
media. A further acceleration of this trend or unpredicta-
ble market developments could further exacerbate the
already declining losses due to the structural change.
Furthermore, the general market situation and media
industry is still characterized by intense competition
pressure. This is due to, among other things, the crea-
tion of alliances or mergers of direct competitors (for
example, in the area of national marketing or the Berlin
newspaper market by the merger of important subscrip-
tion newspapers) which lead to losses in the circulation
and advertising area in the print sector and could result
in a loss of sales.
In addition, the provision of free online and print services
can lead to the loss of sales and weaken our market
positions in the entire sales and advertising business.
Our segment of Marketing Models and Classified Ad
Models is also subject to high market and competition
dynamics. Competitors are constantly pushing with new
offers onto the market, which can endanger our existing
market position. The potential missing of trends, the
delayed introduction of new technologies and the lack of
further development of proprietary products can contrib-
ute to an increase in this risk.
46
Annual Report 2016
Axel Springer SE
Combined Management Report
Report on risks and opportunities
To limit these market and competition risks, a systematic
and continuous monitoring of the market and competition
environment and the resulting trends are carried out.
Control measures for operational management are de-
rived on the basis of this information. We improve the
attractiveness of our business models by investing in
innovative product development, the use of new technol-
ogies, journalistic competence and target-oriented mar-
keting. With these measures, we want to meet changing
customer and reader needs while at the same time main-
taining or expanding our market-leading position.
In addition, new business models are continually being
verified, the digitization of our products is promoted and
our product portfolio is complemented both nationally
and internationally.
Many of our digital Marketing and Classified Ad Models
are additionally confronted with the risk arising from the
dominant position of major Internet search engines. If, for
example, these search engines change their search
algorithms or expand their business models that com-
pete with our business sectors, this can have noticeable
effects on the future revenue situation. Even small
changes in visibility or in position on the results pages
could lead to significant losses in traffic with certain
business models and this to a slump in revenues.
By targeting paid advertisements on search engine re-
sults pages, search engine optimization as well as the
intensified expansion of the activities in the target group-
relevant social media channels, we are working to curb
this risk. At the same time, the continuous improvement
of the attractiveness of our offers and the increase in the
degree of brand awareness are the focus of the Axel
Springer brands, in order to make their reach and use
independent of third-party offers, in particular the visibility
on search engines.
In addition to the growing competition, the loss of large
advertisers who switch to other advertising formats is a
serious risk to our advertising revenues in print and
online. In order to meet these changing customer re-
quirements at an early stage, we have further intensified
the support of our customers as well as organizational
restructuring measures in order to be able to focus par-
ticularly on new customer support and thus to achieve a
risk reduction.
The increasing orientation towards mobile devices is risk-
sensitive in that the traffic in the mobile area is associat-
ed with lower advertising prices and a poorer utilization
which results in lower revenues. In order to achieve a
reduction in risk, we exploit technical possibilities and
reroute direct mobile access to the stationary web pages.
In addition, we combine mobile and stationary marketing
and work on ways to achieve even better monetarization
of mobile traffic.
The increased supply and above all the increasing use of
ad blockers also contains risks for our digital advertising
revenues. Ad Blockers are specially preconfigured brows-
ers and browser add-on programs which prevent advertis-
ing on the requested pages and thus have a detrimental
effect on us. Not only our digital Paid Models, but also our
business models for reach-based marketing and perfor-
mance-oriented advertising models are affected.
We are addressing the increasing spread of ad blockers
both with legal steps against suppliers as well as with the
development of technical solutions. For example, for the
readers of BILD.de, the journalistic content can only be
used if ad blockers are deactivated or an almost adver-
tising-free subscription is completed.
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Political and legal risks
The relevance of data protection and the social and
political sensitivity to this topic has increased. This con-
cerns, on the one hand, the public discussion on the
activities of foreign intelligence services, which was also
cited by the European Court of Justice as the reason for
the termination of the so-called “Safe Harbor Agreement”.
On the other hand, the big search engines and social
media platforms are in the public critique; keywords are
the amount and depth of knowledge about Internet users,
transparency and big data. In addition, reports about
“hacked” servers, lost customer data, as well as IT secu-
rity issues are raising public awareness.
In addition, European data protection law is in a state of
flux: from May 2018, the EU Basic Data Protection Act
will apply. This still brings with it a certain legal uncertain-
ty. In any case, however, the amount of the fines will be
increased in the event of violations of the Basic Data
Protection Act. The ePrivacy policy, which regulates
inter alia the very relevant setting of cookies and the
creation of user profiles on the Internet for Axel Springer,
is currently also being amended and forms an as yet
unknown parallel right to the already mentioned EU Basic
Data Protection Act.
In order to be able to counter the associated risks, Axel
Springer keeps itself informed about these developments
at an early stage through the associations representing
us. Representatives of the publishing and media sectors
throughout Europe are trying to explain to political deci-
sion-makers the business models and risks inherent in
their members so that they are adequately taken into
account within the framework of the democratic legisla-
tive procedure. Axel Springer is also taking steps to
recognize changes relevant to Axel Springer at an early
stage and to implement the resulting organizational and
legal requirements. To this end, our compliance depart-
ment and the legal department introduce appropriate
initiatives in coordination with the operating units. These
include targeted training for the employees affected by
the new laws, the provision of information material, and
the identification of dedicated contacts.
However not only the future but also the existing German
data protection law (in particular the Federal Data Pro-
tection Act and the Telemedia Act) contains many ambi-
guities. This results in risks for digital business models,
as these are largely based on the use of data. Further-
more, in the absence of any long-standing and uniform
jurisdiction with regard to new digital business models,
this means the legal position is in some cases unclear
and, thus, there is the latent risk of written warning letters
and the allegation of breaches of law. Specifically, such a
regulation would affect the use of so-called cookies and
similar technologies, the permissibility of generating user
profiles (profiling, tracking and re-targeting), and other
measures that necessitate the use of personal data
without prior consent. The danger of warnings is being
increased by the amendments made to the Law on
Incidents of Complaints in 2016. It is now also possible
for consumer associations to proceed by means of a
warning or an injunction against companies which do not
act in compliance with data protection regulations when
collecting, processing or using personal data. In addition
to the action for omission, action is also possible for the
removal of data protection-deficient states, i.e. unauthor-
ized stored consumer data are to be deleted or blocked
by the company. This, as well as restrictions on advertis-
ing and customer loyalty, can lead to substantial revenue
losses for mobile and web-based business models, but
also for the print sector. Warnings and potential legal
violations, especially for well-known brands of Axel
Springer such as BILD and WeltN24 in addition to the
direct legal and commercial consequences also entail the
risk of image damage.
In order to reduce the risk of legal infringements, corpo-
rate and subsidiary companies adopt binding guidelines
that include organizational and risk-based measures for
enhanced data protection compliance. For the measures
taken by Axel Springer in the area of IT security, please
refer to the section “IT risks”.
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The Internet activities of public-sector broadcasters contin-
ue to pose a risk to our business. ARD in particular has
intruded into the business sphere of the private-sector
press and distorted the competition environment with a
text-oriented news app for Tagesschau financed by license
fees. Against this free offer, publishers are, of course, hav-
ing more difficulty with market penetration of paid apps.
After conducting fruitless negotiations with ARD and
NDR, Axel Springer and seven other publishing compa-
nies, with the full support of the newspaper publishers’
association BDZV, filed a lawsuit against ARD and NDR
in the Competition Division of the Cologne Regional
Court. In September 2012, the court granted the claim in
most respects. The defendants appealed this ruling and
prevailed in the appellate instance before the Cologne
Higher Regional Court. The plaintiffs appealed against
this before the Federal Supreme Court, the appeal was
upheld and referred the case back to the Cologne Higher
Regional Court for a new trial.
The Higher Regional Court of Cologne responded to the
wishes of the publishers. Nevertheless, our business
continues to be exposed to the risks of distortion of
competition by means of public service broadcasting as
well as regulatory pressure from the legislature at all
relevant levels of government, despite countermeasures.
Infringements of confidentiality agreements and insider
regulations as well as incorrectly published information in
the context of external reporting may result in economic
or legal consequences for Axel Springer. There is also the
risk of a damaged reputation for the group or its brands
by negative reporting or campaigns in social media chan-
nels, even if no legal offense has yet been committed.
In order to minimize these risks, we have, among other
things, audit mechanisms, voting and clearance rules,
drafted relevant directives, and adopted awareness-
raising measures.
IT risks
For Axel Springer, a Group with an increasingly high
degree of digitization of its offerings and internal pro-
cesses, there are numerous significant risks regarding
the availability of IT systems used, as well as the confi-
dentiality and integrity of information.
Due to the high degree of integration of information
technology within business processes, Axel Springer is
reliant on high availability of IT components. Failure of IT
infrastructure as well as the applications that are driven
by said infrastructure, such as those used to view
chargeable content on BILD.de, can have considerable
influence on availability. Possible reasons for impairment
are internal factors such as the increasing complexity of
the systems and the longer-term infrastructure, but also
external factors such as e.g. computer criminality
through deliberately caused server overloads, so-called
DDoS attacks. At worst, these could cause interruptions
in business activities along with far-reaching conse-
quences regarding revenues and reputation.
Additional IT risks are classified as important if the confi-
dentiality of information and data integrity is compro-
mised as a consequence. In consideration of the grow-
ing importance of paid content offerings and services
requiring authentication, and the related collection and
storage of personal data, as well as the steadily growing
threat of computer criminality, the careful handling and
protection of the above-mentioned customer data are of
great importance.
For this reason, targeted measures have been and in-
deed are being undertaken to avoid or to limit the effects
and probability of occurrence of criminal activities and
the failure of IT components to the greatest possible
extent. Measures such as DDos protection, emergency
data centers, firewalls, use of encryption, identity & ac-
cess management, consolidation and standardization
and hardening of systems are used to reduce risk. The
stated measures are continuously analyzed and expand-
ed or improved if necessary.
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Reputation risks
Reputation risks are not recorded separately in Axel
Springer’s risk inventory as they arise in the majority of
cases as a secondary risk or effect in conjunction with
the primary risks. Axel Springer has an exposed position
and any risk that occurs can cause a great deal of atten-
tion. Possible reputation risks range from the violation of
journalistic independence to the breach of country-
specific laws and programs for equal treatment and
equal opportunity.
As a result, countermeasures that aim to prevent the risk
in question from occurring are primarily used to prevent
reputation risks. Notwithstanding this, the fundamental
observance of law and order, information campaigns and
public relations work on established measures are used
in order to prevent reputational damage.
In addition, our International Social Policy, a catalog of
social standards, counteracts potential reputational risks.
Because of their worldwide validity for Axel Springer, a
disregard of our social policy can lead to a considerable
loss of image. The integration of the rules of the Interna-
tional Social Policy into the Group-wide Code of Conduct
and the behavioral standards and corporate principles
contained therein significantly increases the degree of
recognition and thus reduces the risk. Reference is made
to relevant mandatory standards of the International Social
Policy in relevant directives, in particular to procurement.
Axel Springer has instituted an advanced 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 effectively, we work closely together with experts
in the wood, pulp, and paper industry and with environ-
mental protection organizations. We also conduct moni-
toring measures across the value chain. Our internal and
external communications on this subject are character-
ized by openness and transparency.
Strategic and other risks
Significant strategic risks arise primarily for Axel Springer
from decisions regarding capital expenditures in new
business segments and models, as well as companies
that perform differently in the long term than expected or
are unable to compete within the market in a sustainable
manner and/or are superseded by new business models.
Likewise, a possible inadequate diversification entails a
high risk potential. The consequence of this could be
impairment losses when permanent impairment is ex-
pected in the context of the impairment test which is to
be carried out. This risk could materialize in our activities
in the Marketing Models, Classified Ad Models, and
national and international Paid Models segments.
In general, the business segments and models of our
interests are, however, extremely heterogeneous, so that
so-called cluster risks are limited by means of diversifica-
tion. Such risks are further diversified by means of pre-
ventative measures such as the clear investment criteria,
in accordance with which we check new investments as
part of our M&A activities, as well as active portfolio and
investment management, the recruitment and retention
of highly qualified managers, and the continuous moni-
toring of business and market developments. The im-
plemented management measures are adjusted to the
Group's development, both organizationally and in terms
of personnel.
In addition to the aforementioned risks, the dependency
on strategically significant cooperation partners is also
subject to risks, for example for upday, a personalized
news platform developed in cooperation with Samsung.
Legal assistance in the negotiation of the contracts as well
as a continuous monitoring of the business activities of our
cooperation partners contribute to a reduction of this risk.
The focus of Axel Springer SE is not only limited to Eu-
rope, the company is also driving forward international
expansion. With the acquisition of Business Insider and
eMarketer in the US, we not only expanded our portfolio
of innovative Paid Models, but also strengthened our
position in economic news and information.
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However, expansion into foreign markets entails not only
opportunities, but also risks. For example, a changing
political environment, especially in the light of the new US
government, a weak economy or a financial crisis could
lead to declining advertising spending and consequently
lower revenues from our US investments. Through con-
tinuous market observation and diversification of the
revenue flows, we counteract this risk.
The business activities undertaken in Eastern Europe also
form part of Axel Springer’s internationalization strategy.
These activities are combined in Ringier Axel Springer
Media and form part of the Paid Models segment.
The Axel Springer Group identifies potential risks and
uncertainties on the one hand from the political situation
in the individual countries as well as from negative influ-
ences from legislative procedures in the Eastern Europe-
an region. In Poland in particular, the political influence
on the media poses a threat to our business. Thus, gov-
ernment-impacted companies could reduce or even stop
their advertising activities in our products, which would
lead to a significant decline in our advertising revenues.
We counter this risk by means of targeted measures of
cost reductions or programs to secure earnings. Not-
withstanding this, Ringier Axel Springer Media is con-
fronted with the same risks, which have also been desig-
nated for the Paid Models segment of the entire Group.
For example, risks relating to digital change are just as
important as competition and data protection risks and,
due to internationalization, exchange rate risks. The
highly concentrated Polish press distribution business is
an additional risk for the Ringier Axel Springer Media of
the dependence on a few sales partners. This depend-
ency is associated with the risk that, in the event of a
company's failure to pay, higher shares of outstanding
receivables may remain outstanding, resulting in sub-
stantial losses. To limit this increasingly serious risk, a
portion of the potential loss of receivables is already
covered by insurance. In addition, active receivables
management is carried out in order to be able to react
immediately to deteriorating payment modalities.
Our business activity in Germany continues to face in-
creasing challenges in the marketing environment. This
results, inter alia, from increasingly specific customer
requirements (multichannel marketing) or from the mar-
ket entry of new competitors. Media Impact GmbH & Co.
KG, a joint marketing company with the FUNKE
Mediengruppe has a strong counterpart with the market-
ing alliance ScoreMedia, founded by a number of news-
paper publishers and media groups, which focuses on
target group-oriented cross-media marketing. The in-
creased competition could lead to a drop in prices and
thus to a loss of revenues in the print sector. We are also
reacting to this risk with a marketing alliance - Red Im-
pact - which was launched in January 2017. This coop-
eration, which Media Impact has entered into with other
media groups to bundle the marketing of tabloid news-
papers under one roof, allows all participants to tap
further sales potentials for their brands in addition to their
already established marketing.
In addition to the aforementioned strategic risks, Axel
Springer is naturally exposed to elementary risks that con-
tinue to pose significant risks to the Group. Possible dam-
age caused by natural events can lead to property damage
and business interruptions. We counter these risks in two
ways: Firstly, structural and organizational measures have
been undertaken to raise the Group’s security standards
even further, and secondly insurance cover is in place to
reduce any possible financial consequences.
Terrorist attacks on Axel Springer continue to represent a
serious risk, which has risen significantly as a result of the
current global political situation. This risk is countered,
amongst other things, with enhanced security standards,
more stringent access regulations and controls, and
comprehensive education and training of all security staff.
The financial risk due to possible property damage and
business interruption is covered by appropriate insurance.
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In support of the cultural transformation into the leading
digital publisher, work on the modern new headquarter
building of the Axel Springer SE has begun, after the
building permit was granted. When implementing such a
large project, Axel Springer is confronted with building-
specific risks such as cost overruns due to planning,
tendering or procurement errors or increases in raw
material prices, such as steel. In addition, potential com-
plaints from surrounding residents could lead to un-
planned project delays and increase project costs due to,
for example, incomplete compensation requirements or
lack of information flow. In order to reduce the aforemen-
tioned risks, a corresponding general contract agree-
ment was concluded, professional project controlling
and reporting structures were set up, and communica-
tion measures were also implemented in order to react
promptly to complaints from local residents.
Personnel risks
The individual skills, professional competences and the
commitment of our employees contribute significantly to
the success of Axel Springer. As a consequence, the
loss of specialist staff and management is a significant
risk which we actively look to counter. We act profes-
sionally and actively. A primary focus of human resource
management is the targeted, progressive development
of employees and motivation with the aid of focused and
continuous training, attractive bonus schemes, flexible
working time models and a better work/life balance.
Age-related employee turnover is also acted upon at an
early stage with systematic succession planning and
development. As a result, the transfer of a valuable
wealth of experience and personnel demands should be
ensured in a sustainable manner.
In addition, the increasingly difficult situation regarding
the recruitment of junior staff as well as potential man-
agement staff also represents an ever-increasing risk. It
is increasingly difficult to recruit qualified staff, and this is
a result of demographic change, and also a matter of
increasing competition on the human resources market.
IT specialist staff are increasingly in demand, particularly
with regard to the increasing digitization of business
models. As a result, we have set up an internal recruiting
team that has designed personal strategy initiatives and
has already successfully found candidates for digital
business activities. In addition, professional employer
branding as well as our social media activities help us to
significantly differentiate ourselves from other companies
and to position Axel Springer as an attractive and inno-
vative employer.
Financial risks and risks associated with the use of
financial instruments
The financial risks especially relevant to Axel Springer are
default risks associated with loans and financial invest-
ments as well as interest rate risks.
Axel Springer provides loans to business partners from
time to time as part of the company's activities. The risk
of potential default on loan claims is countered by gath-
ering information on the economic and financial situation
of the business partner, along with corresponding analy-
sis and preparation of such data. In addition, these busi-
ness partners have granted us security to their assets.
In our investment in Do⁄an TV Holding A.S. potential
default risks from the agreed sales options were com-
pletely hedged by bank guarantees.
In order to counter possible default risks when investing
non-operational financial resources, the investment is car-
ried out according to predetermined criteria, which are
defined in a Group Guideline. This sets loss limits that may
not be exceeded, as a means (among others) of limiting
risks.
Existing interest rate risks arise primarily from financial
assets or liabilities with variable interest rates. However, this
risk is limited due to fixed financing principles and regular
monitoring of the variable interest rate. During the financial
year, we financed ourselves via the Schuldschein (promis-
sory note), which are mainly fixed interest-bearing, among
other methods. An additional existing interest rate risk that
could affect the Schuldschein loans and credit lines with
variable interest rates is minimized, where required, by
using interest rate derivatives.
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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 lines in the amount of € 1.5 billion (through 2020)
obtained for liquidity assurance purposes have been
committed by the participating banks with binding effect.
The interest rate is linked to a ratio of net debt and earn-
ings indicator of the Axel Springer Group, meaning there-
fore that the utilization of credit lines would result in a
higher interest burden in the case of negative perfor-
mance. As part of the loan agreements, we must also
observe a number of additional conditions that would
give the banks a right of termination if they are not ob-
served. We have observed these conditions, and there-
fore we consider the risk of accelerated maturity of bor-
rowed 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 reputations can
always raise funding at favorable conditions. Furthermore,
Axel Springer can generate liquidity reliably, thanks to its
broadly diversified customer base and the absence of
significant payment delays and defaults.
There are corresponding currency risks to the Group
caused by Axel Springer’s level of internationalization.
Risks arise from expenses, revenues, investment income
and expenses, and receivables and liabilities denominat-
ed in foreign currencies (transaction risk).
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 with net exposures starting
at € 5 million per foreign currency are generally hedged
with maturity-congruent foreign exchange derivatives.
Local-currency cash flows generated in non-euro zone
countries are either reinvested to expand local business
operations, or invested with Axel Springer SE and hedged
or distributed 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 comprehensive income. Therefore, Axel Springer does
not hedge such currency risks.
In the year under review, we again carefully analyzed the
foreign currency risks within the Group and updated the
related principles. A Treasury Committee, which meets at
least six times a year, has been set up to further identify
possible risks and resolve countermeasures. 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
The overall risk situation of the Axel Springer Group
consists of the individual risks of all risk categories of the
consolidated majority interests and of the central divisions.
Compared to the disclosures in the Annual Report 2015,
the risk and opportunities profile of Axel Springer has
improved overall. At the end of April 2016, the vendor
loan issued to FUNKE Mediengruppe was repaid early in
full, including all interest accrued until that point. The
market and use-based revaluation of the printing plant
risks as well as the sale of the publishing house in Ham-
burg also significantly reduced the overall risk.
Taking into account the interaction and aggregation of
individual risks, there are, at present, no discernible risks
that could threaten the continued existence of the Axel
Springer Group, or could significantly affect the Group's
financial position, financial performance and liquidity. This
applies on the proviso that there is no dramatic deterio-
ration of the economic situation in our markets and the
media industry, and, thus, a significant deterioration in
the market and financial performance of the Group.
Furthermore, risk concentrations are being reduced by
means of diversification, internationalization, optimization
of the brand and product portfolio, and digitization.
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Opportunities management
The opportunities management system established at
Axel Springer aims to ensure the success and continued
existence of Axel Springer sustainably by systematically
exploiting early detected opportunities that arise. As part
of the management, strategic and planning processes,
potential opportunities induced both internally as well as
externally are identified and assessed for the company
divisions and interests. External opportunities are offered,
for example, by changing market structures or customer
requirements; internal opportunities arise from product
innovations or quality improvements. This is based, for
example, on market and competition monitoring activities
and analyses as well as regular dialog with experts. In
considering the risks involved, identified opportunities are
fundamental to corporate decision-making and the intro-
duction of corresponding measures, such as measures
regarding investments in new markets or technologies.
Responsibility for the management of opportunities is
taken in as decentralized a manner as possible by the
operational divisions and their management or senior
managers.
Opportunities
In line with the definition of risks, opportunities are mir-
rored as the possibility of positive deviations from defined
targets and can thus serve both the added value and the
generation of potential competitive advantages. They
may arise from unscheduled and/or non-budgeted posi-
tive developments and/or events. This applies if there is
insufficient certainty regarding the occurrence of events,
or the framework conditions and environment develop in
a more favorable manner than expected. In addition,
potential arising from long-term strategic decisions that
had not been fully budgeted may lead to additional
growth.
Strategic opportunities
In a constantly changing environment we continue to
develop our company so that we are able to face global
and industry-specific challenges in the future with inno-
vative and tailored solutions.
Axel Springer’s digitization strategy offers further promis-
ing opportunities for generating additional growth and
revenues based on highly positive developments within
the digital markets. Axel Springer exploits these devel-
opments by investing in new or future-oriented technolo-
gies, entering into new forms of cooperation, the ongo-
ing digital transformation and monetization of journalistic
products. In addition, by combining different media, we
achieve the most comprehensive multimedia coverage in
the German media landscape. This spans digital, print,
video, and live TV, with an emphasis on quality journal-
ism as the hallmark in all media channels.
As more and more industries face the challenge of digiti-
zation, it is becoming increasingly important to generate,
process and present relevant market information in an
intelligent manner. With eMarketer, we have been able to
acquire a well-established, successful and profitable
provider of high-quality digital market data for many
years and are ideally placed to benefit from these market
developments. At the same time, we have taken another
step in this acquisition to expand our product portfolio of
innovative Paid Models and to grow with digital activities,
primarily in the English-speaking world. On the one hand,
acquisition of equity stakes in companies with promising
digital business models in early stage and growth phases
in their lifecycle provides us with the option of establish-
ing contacts within the industry and to other founders
and investors, and also grants access to new ideas and
business models. On the other hand, we also obtain
access to co-investments, which could remain open, if
necessary, for subsequent acquisition of a majority stake.
In the event of substantial development of the associate
companies, we can also profit from a significant appreci-
ation in value.
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Collaboration within the company network can also lead
to highly profitable opportunities. Business Insider has
introduced Markets Insider in the US market with the
support of Finanzen.net, the leading German financial
portal. This offer provides real-time financial market data
and economic news, including up-to-date information
from nearly a hundred stock exchanges around the
world, and is designed primarily for mobile use. At the
same time, advertisers can book integrated and focused
advertising formats, including native and large display
formats. The collaboration of these two companies
shows which interconnected effects can be created by
global networking.
We also see further opportunities for growth in the digital
internationalization strategy and, closely linked to this,
entering into new markets and/or expanding in existing
markets. As a result, there is significant potential associ-
ated with the introduction of business models success-
fully established in the home market, the acquisition of
existing and successfully established companies, and
entering into strategic partnerships in international
growth regions. We also have an advantage over our
competitors in that we have already attained strong
market positions in many countries.
Market and competition opportunities
If the global economy develops better than previously
predicted, this could have a positive impact on our sales
performance. The decisive factor will be what spill-over
effect regional conflicts and crises will have on our core
markets subject to the highly interconnected nature of
the global economy. Nevertheless, Axel Springer believes
it is in a strong position to exploit the opportunities that
may arise with its early investments in the regional and
digital growth markets. Even a negative development of
the overall economy could create opportunities. This
allows competitors to leave the market, while strengthen-
ing our own position. Furthermore, there may be the
option of acquiring companies at low prices, then sub-
sequently expanding market share in existing markets
and investing in new markets with growth potential.
Additional industry-specific potential to generate un-
planned revenue for Axel Springer may also arise from
higher advertising spending on individual advertising
media than forecast by advertising associations. This
could in particular be the case if the media mix changes
in our favor, or, in other words, if advertising spending
flows into the digital sector driven by journalistic content.
The strategic partnership with Samsung, which has exist-
ed since 2015, from which the product upday has
emerged, is also proving to be very promising. upday is a
joint content platform for aggregated journalistic news
content, which is compiled and played according to a
selection by experienced journalists and according to the
individual interests of the user. upday is preinstalled in
Germany, UK, France and Poland on all relevant devices
from Samsung, has reached within a short time a range
of more than seven million unique users per month (as of
December 2016) and is the most extensive news app on
Android smartphones in Germany. It is planned that up-
day will start in Spain and Italy in March 2017 and expand
into ten other European countries in the second quarter.
In our segment of marketing offerings, Bonial, a company
offering apps and web site solutions for the stationary
retail market, is advancing the digitization of the trade with
a new product solution. With the specially developed
Bonial Connect solution, it is now possible to bring digital
brochures directly to the websites of the trade and the
brand manufacturers and thereby to connect consumers
with their favorite stores. Bonial Connect focuses the
digital online trade advertising more on customer re-
quests and requirements and is continuing to establish
itself as a reliable advertising partner for retailers.
In addition to the challenges that occur, the technological
developments seen in the marketing business also con-
stitute further opportunities for additional advertising
revenues. In this way, there is a change in online market-
ing through programmatic advertising. This form of me-
dia planning stands for the automated purchase of ad-
vertising by means of target group data in digital media
and thus a change from the environment marketing to
the marketing of target groups. With our know-how and
the targeted approach to our customers through target-
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ing measures, there are promising additional opportuni-
ties in the advertising business. The increased interna-
tionalization of Axel Springer resulting from correspond-
ing investments represents an additional benefit to the
Group within the advertising business. In comparison to
rival publishers who are more heavily focused on the
German-speaking region, we are able to offer globally
active customers a wider reader base and/or higher
reach for advertising campaigns, all from a single source.
pets“. The market-leading search engine provider reject-
ed this. At present, there is a revocable “free-of-charge”
consent granted by the publishers to Google to use their
text snippets in search results. VG Media (Verwertungs-
gesellschaft), which represents more than 200 digital
publishing services, including Axel Springer, has filed a
payment claim against Google. This may have a positive
impact on Axel Springer and its digital offerings, depend-
ing on the outcome and/or any agreement reached.
All of Axel Springer’s divisions and companies work on
continuous improvement of technologies and processes
in order to maintain and expand their position in the face
of competition. An intensive group-wide exchange of
successful business models is part of that, but it also
includes innovative start-ups.
Political and legal opportunities
The ancillary copyright for press publishers (Leistungs-
schutzrecht für Presseverleger) entered into force at the
beginning of August 2013, with the aim of further enhanc-
ing the protection of intellectual property. This stipulates
that license fees shall be chargeable to search engine
providers for using publisher content, unless such use
relates to “individual words” or “the smallest text snip-
Operational and other opportunities
Axel Springer is continually working on the optimization
of operational processes and structures. Axel Springer
therefore regards inter-company, cross-divisional and
cross-functional interlinking as a key factor for success in
order to produce innovative and tailored content as well
as provide high quality products and services for our
customers. Smooth interlinking and the digital transfor-
mation of processes could lead to a number of un-
planned synergy effects on the cost situation, thus lead-
ing to positive deviations from the budget. Also, the
enhanced and promoted exchange of e.g. technological
know-how of our companies offers additional opportuni-
ties to further increase our position in our core markets.
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Forecast report
Forecast report
Anticipated economic environment
General economic environment
According to the International Monetary Fund (IMF), the
global economy is benefiting from the good prospects
for growth in the US, China, Europe and Japan. The
growing recovery in larger emerging and developing
countries could also help the global economy to grow
more strongly in 2017 than in the previous year. These
are the expectations expressed by the IMF in its updated
economic outlook in January 2017. Overall, the global
economy is forecast to grow by 3.4 % in the current year
and 3.6 % in 2018 - after 3.1 % in 2016.
After the election victory of Donald Trump, the IMF has
slightly revised its forecast for growth in the US. Trump
administration measures are expected, which could lead
to a further strengthening of the US dollar. According to
the IMF, the US economy will grow by 2.3 % in 2017 and
by 2.5 % in 2018 According to forecasts, the Chinese
economy is expected to grow by 6.5 % better than ex-
pected in previous forecasts. The IMF sees little change
for the euro zone. The area of the community currency
will continue to grow by 1.6 % in the next two years.
Germany is slightly less than 1.5 %.
The ifo Institute has slightly raised its economic forecast
for Germany. It is now expecting a real growth of 1.5 %
in 2017, after a growth of only 1.4 % had been predicted,
together with other economic research institutes in au-
tumn 2016. The driving force remains domestic demand.
As a result, private consumption will expand by 1.2 %,
supported by higher wages, increasing transfer income
and rising employment. Public consumption, which has
so far been primarily driven by migration, however, is
diminishing in power.
Construction investment is expected to rise by 1.8 % in
real terms in 2017. Construction investment benefits
from the continued favorable interest rate environment,
and investment in residential buildings is stimulated, in
particular, by the large number of housing prospects. On
the other hand, equipment investment is expected to
grow only relatively slowly, compared to earlier recovery
phases, with a price-adjusted 1.3 %. According to the ifo
forecast, exports are also likely to only increase moder-
ately in comparison to previous economic upturns. ifo
Institute's economic researchers expect exports to grow
3.1 % in real terms in 2017, while imports are also ex-
pected to rise by 3.8 % in real terms.
The inflation rate is expected to continue to rise in 2017.
According to the ifo forecast, the declining effect of falling
oil prices will allow the inflation rate to increase to 1.5 % in
2017. The unemployment rate is expected to remain
unchanged at 6.1 % in 2017 despite the immigration of
refugees. Thus, the number of employees increases by
around 300,000. On an annual average, the forecasts
foresee around 43.8 million people in employment;
2.7 million people are expected to be unemployed.
The ifo Institute anticipates a slight acceleration in eco-
nomic stimulation for Central and Eastern Europe.
Low interest rates and strong consumer spending are
likely to stimulate investment. In view of rising domestic
demand, imports are expected to grow more strongly
than exports. In total, the DIW expects growth in the
region to grow by 3.5 % in 2017.
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Forecast report
Currently available forecasts for Germany predict mixed
developments for the different types of media. Zenith-
Optimedia expects net advertising market revenue (mar-
keting revenues net of rebates and agent’s commission)
in Germany for 2017 to increase by 2.6 % (nominal).
Thus, the total advertising market will not grow as fast as
the general economy, which is expected to expand at a
nominal rate of 2.9 % (+1.5 % in real terms) according to
the ifo Institute. The advertising market growth is driven
by digital (+ 8.2 %), TV (+ 2.5 %), Radio (+ 2.3 %) and
Outdoor (+ 3.7 %). ZenithOptimedia is predicting a de-
crease in net advertising revenues for newspapers
(– 2.3 %) and magazines (– 3.0 %).
The forecast data also reflects the structural shift of
advertising expenditures in favor of digital platforms. The
proportion of total advertising expenditures targeted to
online and mobile platforms will rise further.
Global trends also set the tone for Germany. Growth in
the advertising market is technology-driven, particularly
in the mobile, online moving images (video) and pro-
grammatic growth segments. Due to the continued
spread of mobile devices, technical improvements in
advertising forms and increase in the variety of advertis-
ing forms, and technical innovations in controlling multi-
device campaigns, considerable growth in advertising
expenditure is expected.
Progressive automation of an advertising booking via
programmatic buying platforms is also seen as a driver
for online and mobile advertising.
ZenithOptimedia’s forecast for the international
markets in which Axel Springer conducts business
through its own subsidiaries paints a mixed picture. The
net advertising volume on the online market in Western
Europe in 2017 will increase by 8.6 % to USD 40.4 billion,
based on the assumption of consistent exchange rates.
Anticipated Economic Development (Selection)
Change in gross domestic product compared to
prior year (real)
Germany1)
France1)
United Kingdom1)
Poland
Switzerland2)
Hungary
Belgium
Slovakia
Netherlands
Serbia2)
Ireland
Italy
Spain2)
USA1)
Israel2)
2017
1.5 %
1.3 %
1.5 %
2.5 %
1.3 %
2.3 %
1.2 %
3.2 %
2.0 %
2.8 %
3.5 %
0.7 %
2.3 %
2.3 %
3.0 %
Source: ifo Institute, December 2016.
1) Source IMF, January 2017.
2) Source: IMF, October 2016.
Industry environment
In the 2017 federal election year, Germany is generally
expected to see further growth in advertising budgets, al-
though growth should slightly weaken compared with
2016.
According to the current advertising market forecast by
ZenithOptimedia, an increase of 4.4 % is expected for
2017 worldwide (nominally). ZenithOptimedia therefore
corrected its forecast of + 4.5 % from September 2016
slightly downwards. ZenithOptimedia sees this as a very
strong development, as the unexpected outcome of the
EU referendum in the UK and presidential elections in the
US have increased political uncertainty and the risk of
trade restrictions. The year 2017 is also a challenging
year in comparison with 2016, which was able to benefit
considerably from major events that take place every
four years (elections in the USA, the Olympic Summer
Games and the European Football Championship).
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Forecast report
Anticipated Advertising Activity 2017 (Selection)
Group
Change in net ad revenues compared
to prior year (nominal)
Germany
United Kingdom
France1)
Poland1)
Switzerland2)
Hungary
Belgium2)
Slovakia1)
Netherlands
Serbia1)
Ireland
Italy1)
Spain1)
USA
Israel
Brazil
Online
Print
8.2 %
– 2.6 %
7.0 %
– 6.3 %
5.6 %
– 7.7 %
12.1 %
– 15.4 %
12.9 %
– 3.4 %
8.7 %
– 1.8 %
12.0 %
– 2.0 %
15.8 %
– 3.4 %
10.5 %
– 7.5 %
13.0 %
3.0 %
16.0 %
– 3.0 %
7.4 %
– 4.2 %
Strategic and organizational orientation
The highest strategic priority for Axel Springer is to pur-
sue the consistent digitization of our business. We aim to
attain the goal of becoming the leading digital publisher
by further developing our digital offerings in Germany and
abroad, and by making targeted acquisitions.
Comparison of forecast with actual performance
The forecast targets published in March 2016 were
essentially attained.
Group
Forecast / adjustments during the year
2016
Revenues
low single-digit percentage increase/
development approx. on prior-year level
– 0.1 %
12.0 %
– 1.6 %
EBITDA
low to mid single-digit percentage
increase
14.6 %
– 6.9 %
6.9 %
– 4.9 %
7.0 %
– 9.7 %
EBIT
development slightly below
EBITDA development
Earnings per
share, adjusted
low to mid single-digit percentage
increase
6.5 %
4.9 %
8.5 %
Source: ZenithOptimedia, Advertising Expenditure Forecast (December 2016).
1) Excluding Classified ads, that means exclusively sales from display advertising.
2) Gross advertising revenues (excluding classified ads).
The revenue forecast for the Group was adjusted after
the first six months of 2016 primarily due to currency
effects. The adjusted revenue forecast was met at the
end of the year. The increase in EBITDA as well as the
increase in adjusted earnings per share was at the upper
end of the announced range. Expectations for the devel-
opment of EBIT were met.
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Annual Report 2016
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Forecast report
Segments
Revenues
Forecast / adjustments during the year
2016
Classified
Ad Models
Low double-digit percentage
increase
Paid
Models
Mid single-digit percentage
decline
Marketing
Models
Mid single-digit percentage growth/
development approx. on prior-year level
Services/
Holding
EBITDA
Significant
decline
Classified
Ad Models
low double-digit percentage
increase
Paid
Models
mid to high single-digit percentage decline/
mid single-digit percentage decline
Marketing
Models
development approx. on prior-year level/
low to mid single-digit percentage decline
Services/
Holding
mid single-digit percentage decline/
slight improvement
EBIT
Classified
Ad Models
comparable development to
EBITDA
Paid
Models
comparable development to
EBITDA
Marketing
Models
development below
EBITDA development
Services/
Holding
development below
EBITDA development
16.8 %
– 6.4 %
– 2.6 %
– 9.7 %
16.3 %
– 3.9 %
– 6.6 %
2.5 %
15.5 %
– 4.5 %
– 10.6 %
– 4.3 %
Among the segments, the expectations for the Classified
Ad Models and the Paid Models segment were met, with
Classified Ads at the top end of expectations. For the Paid
Models the EBITDA/EBIT forecast after the first six months
was more precisely defined and met at the end of the year.
In the case of the Marketing Models, the forecast was also
adjusted after the first six months. The adjusted forecast
was not achieved in terms of revenues; it was narrowly
met in terms of the development of EBITDA/EBIT. For the
Services/Holding segment, the forecast for EBITDA/EBIT
was also adjusted after the first six months. The adjusted
forecast for EBITDA/EBIT and the forecast for revenue
development was confirmed by the business develop-
ments in the Services/Holding segment.
Anticipated business developments and financial
performance of the Group
For the financial year 2017, we expect Group revenues
to increase by an amount in the medium single-digit
percentage range. We assume that the planned increase
in advertising revenues will overcompensate the slight
decline in circulation revenues and the decline in other
revenues.
We expect a rise in EBITDA in the medium to high sin-
gle-digit percentage range. In this case, a rise in EBITDA
in the Classified Ads Models segment and Marketing
Models is expected, while the earnings in the Paid Mod-
els segment should finish around the level of the prior
year. For the Services/Holding segment, the EBITDA is
expected to be below the prior-year level.
For EBIT, we expect a rise in the low to medium single-
digit percentage range due to higher depreciation, amor-
tization and impairments.
For the adjusted earnings per share, we expect an
increase in the medium to high single-digit percentage
range.
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Forecast report
Anticipated business developments and financial
performance of the segments
The revenues of the Classified Ad Models segment are
expected to show a rise in the low double-digit percent-
age range mainly due to organic growth. We expect
EBITDA to increase in the low double-digit percentage
range, despite increased investments in IT, marketing
and sales.
In the Paid Models segment we expect revenues to be
roughly on par with the prior-year level for the 2017 finan-
cial year. For circulation revenues, we expect an amount
slightly below the prior-year level. For advertising reve-
nues, we anticipate an increase, while we expect other
revenues to be below the prior-year figure. For EBITDA,
we expect a stable development. We assume that the
growth in digital activities and declining launch costs will
compensate for the decline in the print business.
We expect revenues in the Marketing Models segment
to increase by an amount in the high single-digit to low
double-digit percentage range, based on the anticipated
growth in advertising and other revenues. For EBITDA,
we also expect an increase in the high single-digit to low
double-digit percentage range.
For the Services/Holding segment, we expect a con-
siderable decline in revenues due to decreasing printing
plant revenues and lower rental revenues in connection
with the sale of parts of the building on the Hamburg site.
For EBITDA, we therefore expect a significant deteriora-
tion compared with the prior year.
For EBIT, we expect developments in the Paid Models
segment to be similar to those of EBITDA, and for the
Services/Holding segment, due to lower depreciation,
we expect less of a decline than for EBITDA compared
with the prior year. In the Classified Ad Model segment,
EBIT development will be significantly below the EBITDA
trend due to higher depreciation, amortization and im-
pairments, while for Marketing Models it will be slightly
below the EBITDA trend.
Anticipated liquidity and financial position
With regard to liquidity and financial position, invest-
ments in property, plant and equipment and intangible
assets will be significantly above the prior-year level,
mainly due to investments in the new headquarter build-
ing in Berlin. Financing will be provided by operating
cash flow. Excluding the investments for the new head-
quarter building in Berlin, investments are also expected
to be significantly above the prior-year figure.
Dividend policy
Subject to the condition of continued sound financial
performance in the future, Axel Springer will pursue a
dividend policy of stable or slightly increased dividend
distribution, while also allowing for the financing of
growth.
Anticipated development of the workforce
The annual average number of employees in the Group
for 2017 will be higher than the prior-year figure.
This is mainly due to organic growth and acquisitions in
connection with the digital transformation of the Group’s
business.
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 sufficiently probable
from today’s perspective. However, actual developments
could possibly be much different from the assumptions
applied and thus from the business plans and trend
forecasts prepared on the basis of those assumptions
Basically, the forecast is based on the assumption that
no significant deterioration in the economic environment
will follow and that the actual exchange rates do not
deviate significantly from the underlying assumed ex-
change rates.
The forecasts for EBITDA, EBIT, and the adjusted earn-
ings per share do not reflect any effects resulting from
possible future acquisitions, divestitures, and capital
measures or from unplanned restructuring expenses.
61
Annual Report 2016
Axel Springer SE
Combined Management Report
Disclosures and explanatory report of the Executive
Board pursuant to takeover law
Disclosures and explanatory report of the
Executive 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 Executive Board pursuant to Section 176 (1)
(1) AktG.
Composition of subscribed capital
Following the capital increase implemented in December
2015, the company’s subscribed capital amounts to
€ 107,895,311. It is divided into 107,895,311 registered
shares. 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 determining the
shareholder’s entitlement to the company’s net profit. By
way of exception, treasury shares do not confer any
rights to the company (cf. Section 71b AktG).
(Please refer to page 65 for information on the compa-
ny’s treasury shares.)
Restrictions on voting rights or the
transfer of shares
Transfer restrictions
By virtue of Article 5 para. 3 of the company’s Articles of
Incorporation, shares of Axel Springer SE and subscrip-
tion rights can be transferred only with the company’s
consent. Such consent must be granted by the Execu-
tive Board, although internally, it is the Supervisory Board
that adopts the resolution to grant such consent. Ac-
cording to the company’s Articles of Incorporation, such
consent can be refused without indication of reasons.
However, the company will not arbitrarily refuse its con-
sent to the transfer of company shares.
To the Executive Board’s knowledge, transfer restrictions
based on the German law of obligations (Schuldrecht)
exist by virtue of the following agreements:
A share transfer restriction agreement was concluded
between Dr. Mathias Döpfner, Brilliant 310. GmbH,
Axel Springer AG and M.M. Warburg & Co. KGaA on
July 31/August 4, 2006. Under this share transfer re-
striction agreement, the direct and indirect purchase or
disposal of the shares of Axel Springer SE by Brilliant
310. GmbH or Dr. Mathias Döpfner are made contin-
gent on the prior consent of Axel Springer SE, in ac-
cordance with the company’s Articles of Incorporation.
By virtue of a declaration dated August 14, 2012,
Dr. Mathias Döpfner acceded to a pool agreement
(“pool agreement”) concluded between Dr. h. c. Friede
Springer and Friede Springer GmbH & Co. KG, in re-
spect of the 1,978,800 shares of Axel Springer SE
that were given to him as a present by Dr. h. c. Friede
Springer on the same date. In total, the pool agree-
ment covers 52,826,967 voting shares of Axel
Springer SE (“pool-bound shares”). Under the terms
of the pool agreement, a pool member who wishes to
transfer his pool-bound shares to a third party must
first offer these shares for purchase to the other pool
members (purchase right). The purchase right expires
two weeks after the purchase offer. The purchase
right does not apply in the case of transfers to certain
persons who are related to the pool member.
With regard to the 8,955,311 new individual shares of
the Axel Springer SE issued to the General Atlantic
Coöperatief U.A., Amsterdam, Netherlands within the
scope of the capital increase in December 2015, the
company and the General Atlantic Coöperatief U.A
agreed to a holding period of 6 months for half of
these shares, which has since expired, and a holding
period of 18 months for the other half. The same ap-
plies to the shares of Axel Springer SE held by Dr.
Giuseppe Vita.
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Annual Report 2016
Axel Springer SE
Combined Management Report
Disclosures and explanatory report of the Executive
Board pursuant to takeover law
In addition, shares of the Axel Springer SE of the
Brilliant 310. GmbH and of Dr. Mathias Döpfner are
pledged to a credit institute.
Other transfer restrictions based on the German law of
obligations exist in connection with the share ownership
programs conducted in the 2013, 2014 and 2015 financial
years, as well as the current financial year, for the employ-
ees of the Axel Springer Group. In general, the shares
acquired as part of the share ownership program in 2013,
2014 and 2015 are subject to a minimum holding period
of four years (i.e. until May 31, 2017, 2018, and 2019).
During the minimum holding period, employee shares are
held in a blocked account with Deutsche Bank AG.
The minimum holding periods for shares issued under
share ownership programs in earlier years have already
expired.
In connection with the Virtual Stock Option Plan 2011 II
and 2014 for senior executives, the beneficiaries are
required to personally invest in shares of Axel Spring-
er SE. These shares are not subject to any restrictions
on disposal, but any disposition of these shares would
cause the corresponding virtual stock option rights to
lapse without replacement or compensation (for infor-
mation on the virtual stock option plan 2011 II and 2014
for senior executives, see page 80).
The same applies to the virtual stock option plans 2012
and 2014 for members of the Executive Board (see page
77 for information on the virtual stock option plans 2012
and 2014 for Executive Board members).
Finally, persons who perform management tasks at Axel
Springer SE in the sense of the European Market Abuse
Regulation (MMVO) must comply with the closed periods
established by Article 19 (11) MMVO. In accordance with
these statutory periods, the company has developed
guidelines for persons of the highest management, for
whom dispensation may be granted in individual cases.
Voting right restrictions
In accordance with the pool agreement mentioned
above between Dr. Mathias Döpfner, Dr.h.c. Friede
Springer and the Friede Springer GmbH & Co. KG, the
voting rights and other rights from the pool-bound
shares in the annual shareholders‘ meeting of the Axel
Springer SE are to be exercised according to the deci-
sions of the pool members, and in fact independent of
whether and in what sense the respective pool member
voted at the resolution of the pool. The voting rights of
pool members in the meeting of pool members are
based on their voting rights in the annual shareholders’
meeting of Axel Springer SE, depending on the number
of pool-bound voting shares held. To the extent that
Friede Springer GmbH & Co. KG indirectly holds shares
in Axel Springer SE its voting rights are based on the
imputed number of pool-bound voting shares indirectly
held by Friede Springer GmbH & Co. KG.
Restrictions on voting rights may also be imposed by
virtue of provisions of the German Stock Corporation Act
(Aktiengesetz), pursuant to § 136 German Stock Corpo-
ration Act (AktG) and capital market regulations, in par-
ticular §§ 21 ff. WpHG.
Shareholdings that represent more than
10 % of voting rights
At the end of financial year 2016, the following direct and
indirect shareholdings in the equity of Axel Springer SE
represented more than 10 % of voting rights in the com-
pany: Axel Springer Gesellschaft für Publizistik GmbH &
Co, Berlin, Germany (direct), AS Publizistik GmbH, Berlin,
Germany (indirect), Friede Springer GmbH & Co. KG,
Berlin, Germany (indirect), Friede Springer Verwaltungs-
GmbH, Berlin, Germany (indirect), Dr. h. c. Friede
Springer, Berlin, Germany (indirect), and Dr. Mathias
Döpfner, Potsdam, Germany (indirect).
Information on the amounts of the above-mentioned
shareholdings may be found in the disclosures pertaining
to voting rights notifications in the notes to the 2016
financial statements of Axel Springer SE,
www.axelspringer.com/financialpublications, and in the
63
Annual Report 2016
Axel Springer SE
Combined Management Report
Disclosures and explanatory report of the Executive
Board pursuant to takeover law
section entitled “Voting rights notifications” of the com-
pany’s website at www.axelspringer.com/votingrights.
Shares endowed with special rights that
confer powers of control
There are no shares endowed with special rights that
confer powers of control.
Manner of controlling voting rights
when employees hold shares in the
company’s capital and do not directly
exercise their rights of control
In connection with the bonus share and share ownership
program for employees conducted in 2009 and the
share ownership programs for the years 2011, 2012,
2013, 2014 and 2015, Deutsche Bank AG was initially
entered into the share register as the third-party holder of
the shares transferred to the employees. However, each
employee is free to be registered personally as a share-
holder in the share register.
Statutory provisions and provisions of the
Articles of Incorporation pertaining to the
appointment and dismissal of Executive
Board members and amendments to the
Articles of Incorporation
The company’s Articles of Incorporation provide that the
Executive Board of Axel Springer SE must be composed
of at least two persons. The Supervisory Board decides
on the number of Executive Board members, and on the
appointment and dismissal of Executive Board members.
According to Article 46 para. 1 of the EU Regulation on
European Companies (SE-VO), the maximum term of
office for members of the Executive Board of a European
company (Societas Europaea, SE) is six years; in the
present instance, this maximum term is shortened to five
years by virtue of Article 8 para. 2 sub-para. 1 of the
Articles of Incorporation of Axel Springer SE – corre-
sponding to the previous maximum term pursuant to
Section 84 (1) (1) of the German Stock Corporations Act
(AktG). A repeated appointment or extension of the term
of office is permissible for a maximum of five years. If
more than one person has been appointed to the Execu-
tive Board, the Supervisory Board is authorized to ap-
point one of those members as the Chairman (Article 8
para. 3 sub-para. 2 of the Articles of Incorporation of
Axel Springer SE). If a required Executive Board member
is lacking, the court is authorized, in urgent cases, to
appoint the necessary member at the request of one
involved party (Article 9 para. 1 letter c). ii) SE-VO in
conjunction with Section 85 (1) (1) AktG). The Superviso-
ry Board is authorized to revoke the appointment of an
Executive Board member and the Executive Board
Chairman for an important reason (for details, see Article
39 para. 2 sub-para. 1, Article 9 para. 1 letter c). ii) SE-
VO, Section 84 (3) (1) and (2) AktG).
Insofar as obligatory laws or provisions of the Articles of
Incorporation do not require a greater majority, amend-
ments to the company’s Articles of Incorporation require
a resolution of the annual shareholders’ meeting carried
by a majority of the votes cast, or provided that at least
one half of the company’s share capital is represented
by a simple majority (see Article 21 para. 2 sub-para. 2 of
the company’s Articles of Incorporation in conjunction
with Section 51 (1) of the European Company Imple-
menting Act (SEAG), Article 59 para. 1 and 2 SE-VO).
The latter does not apply to an amendment changing the
business object and purpose of the company, or to a
resolution regarding the relocation of the registered head
office of the SE to another member state pursuant to
Article 8 para. 6 SE-VO as well as cases that prescribe a
higher majority stake (see Section 51 (2) SEAG, Article
59 para. 1 and 2 SE-VO). An amendment of the corpo-
rate governance principles set forth in Article 3 of the
company’s Articles of Incorporation requires a majority
equal to at least four fifths of the votes cast represented
in the adoption of the resolution (see Article 21 para. 3 of
the 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).
64
Annual Report 2016
Axel Springer SE
Combined Management Report
Disclosures and explanatory report of the Executive
Board pursuant to takeover law
Authority of the Executive Board to issue
or buy back shares
The Executive Board was authorized, in accordance with
Article 5 para. 4 of the Articles of Incorporation, and
based on the resolution of the annual shareholders’
meeting of April 14, 2015, to increase the capital stock
by April 13, 2020, subject to the approval of the Supervi-
sory Board, by issuing registered shares of restricted
transferability, either in a single tranche or in several
tranches and in return for cash and/or non-cash contri-
butions (including mixed non-cash contributions), up to a
total of € 11,000,000 (authorized capital).
By partially drawing down this authorized capital, the
capital stock was increased by € 8,955,311 and
8.955.311 new registered shares of Axel Springer SE
were issued to General Atlantic, with effect from Decem-
ber 9, 2015. The remaining authorized capital, which
allows an increase of the share capital by a further
€ 2,044,689 until April 13, 2020, was not utilized until
the end of the year under review.
By resolution of the annual shareholders' meeting on
April 16, 2014 (agenda item 8), the Executive Board was
authorized to acquire treasury shares of up to 10 % of
the capital stock at the time of the resolution, with the
approval of the Supervisory Board, by 15 April 2019.
Acquisition must only take place on the stock exchange
or via a public offer directed at all shareholders or a
public invitation to submit an offer to buy.
Along with the shares held by the company or attributa-
ble to the company in accordance with Article 5 SE-VO
in conjunction with Sections 71a ff. AktG, the shares
purchased by virtue of the foregoing authorization may
not at any time exceed 10 % of the company’s capital
stock. Details concerning this authorization are provided
in the invitation to the annual shareholders’ meeting of
April 16, 2014, which is available on the website of Axel
Springer SE (see Agenda Item 8 and the Executive
Board’s report on this subject).
At the end of financial year 2016, the company held no
treasury shares.
Axel Springer SE does not have any contingent capital.
Significant agreements of the company
subject to the condition of a change of
control resulting from a takeover offer
With the exception of regulations in the Schuldschein
and consortium loans stated in the following, as well as
contractually entitled cancellation rights for Executive
Board members in case of a change of control (for more
information see page 67 (left hand column) below and
page 79 of this Annual Report), the company has not
made any major agreements that would take effect in the
event of a change of control due to a takeover.
65
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Disclosures and explanatory report of the Executive
Board pursuant to takeover law
In April 2012 the company placed a promissory note on
the capital market. Following partial dismissal, conver-
sion and re-drawing in October 2014, the promissory
note issued a total volume of € 637,000,000, available in
six tranches. The first tranche of € 56,500,000 was due
in April 2016, so the open total volume is € 580,500,000.
The lender can demand, in the event of a change of
control, that the receivables held can be partially or fully
paid back early within a 90 day period.
Aside from specific exceptions that relate to the share-
holders that currently control Axel Springer SE, a change
of control is understood to mean, in the context of the
Schuldschein, the acquisition of shares of Axel Spring-
er SE representing more than 50 % of the capital stock
and/or voting rights by one or more parties acting together.
With regard to the consortium loans re-negotiated in July
2015 and totaling € 1,500,000,000, the lenders are also
entitled to terminate the loan in the event of a change of
control with a term of 30 days after becoming aware of it.
Aside from specific exceptions that relate to the share-
holders that currently control Axel Springer SE, a change
of control is understood to mean the acquisition of
shares of Axel Springer SE representing more than 50 %
of voting rights by one or more parties acting together.
Indemnification agreements between the
company and Executive Board members
or employees in the event of a change of
control
Some Executive Board members have the right to termi-
nate their employment contracts in the event of a change
in control. A change of control in the context of these
agreements shall not apply if the controlling shareholder
Dr. h. c. Friede Springer no longer holds and/or intends to
control the majority of shares, either directly or indirectly.
In such a case, they will have the right to receive payment
of their base salary for the most recently negotiated re-
maining contractual term (some of the eligible Executive
Board members will have the right to receive payment of
an amount equal to at least one year’s base salary)
and/or a lump sum amounting to the total remuneration
for the duration of the original residual term; the amount
of the aforementioned payments is typically limited. Fur-
thermore, the company will pay the pro-rata temporis for
the period of time served in the year of resignation. The
employment contracts of the members of the Executive
Board do not provide for any other compensation if the
employment relationship is terminated as a result of a
change in control. There are no such indemnification
agreements with other employees of the company.
66
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Corporate Governance Report
Corporate Governance Report
There follows a report by the Executive Board – also on
behalf of the Supervisory Board – on corporate govern-
ance at Axel Springer, in conformity with the recommen-
dation set out in Section 3.10 of the German Corporate
Governance Code (GCGC). This section also contains
the management declaration pursuant to Section 289a
of the German Commercial Code (HGB) and the Com-
pensation Report.
Good corporate governance as a guiding
principle
At Axel Springer, sound transparent corporate governance
is considered to be a crucial element of responsible man-
agement and supervision geared to increasing the com-
pany’s value on a sustainable basis. It promotes the trust
and confidence of our national and international investors,
customers, employees, and the public in the management
and supervision of the company and is therefore an es-
sential basis for the company’s long-term success.
In this respect, we are guided by the German Corporate
Governance Code (GCGC). We have taken appropriate
measures in order to comply with and implement the
recommendations of the Code. The Corporate Govern-
ance Officer is the Executive Board member in charge of
Finance and Personnel. The implementation of and ad-
herence to the recommendations of GCGC are reviewed
continually.
Management declaration pursuant to
Section 289a HGB
Declaration of Conformity pursuant to Section 161
AktG
The Executive Board and Supervisory Board published the
following Declaration of Conformity on November 2, 2016:
“Pursuant to Section 161 of the German Stock Corpora-
tion Act (Aktiengesetz, “AktG”), the Executive Board and
the Supervisory Board of Axel Springer SE declare the
following:
I. Future-related Section
The Company follows the recommendations of the Ger-
man Corporate Governance Code (Deutscher Corporate
Governance Kodex, “DCGK”)) as amended on 05 May
2015 and published by the German Federal Ministry of
Justice and Consumer Protection in the official an-
nouncements section of the electronic Federal Gazette
on 12 June 2015, with the exception of the deviations
set out and reasoned below:
1) Consideration of the relationship between the com-
pensation of the Executive Board and that of senior
management and the staff overall, particularly in terms of
its development over time (Item 4.2.2 sentence 6 DCGK)
The Supervisory Board pays close attention to the ap-
propriateness and customariness of the Executive
Board’s compensation and takes into account a multi-
tude of criteria, in particular those listed in Section 87
AktG and in Item 4.2.2 sentences 4 and 5 DCGK. Never-
theless, a deviation from the recommendation of Item
4.2.2 sentence 6 DCGK is declared on a precautionary
basis because - apart from uncertainties in interpretation
- there are also doubts as to whether the particular em-
phasis on the relation between the Executive Board
compensation and the compensation of senior man-
agement or the staff overall is in accordance with the
relevance of this criterion in the context of assessing the
appropriateness and customariness of Executive Board
remuneration.
2) Disclosure of the individual Executive Board compen-
sation in tabular form as part of the Compensation Re-
port (Item 4.2.5 sentences 5 and 6 DCGK)
Executive Board compensation is disclosed in accord-
ance with the provisions of law and in consideration of the
so-called “opt-out“ resolution of the Company's Annual
General Meeting of 16 April 2014. Based on this resolu-
tion, and in accordance with Section 286 para. 5 sen-
tence 1 and Section 314 para. 2 sentence 2 of the Ger-
man Commercial Code (Handelsgesetzbuch, “HGB”), the
individual compensation of the members of the Executive
Board is not disclosed in the Company's annual financial
and annual consolidated financial statements for the
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Corporate Governance Report
financial years 2014 to (and including) 2018. As long as a
corresponding opt-out resolution of the Annual General
Meeting is in effect, the Company will not include the
representations recommended according to Item 4.2.5
sentences 5 and 6 DCGK in the Compensation Report.
3) Setting of a general limitation to the length of mem-
bership in the Supervisory Board, and taking it into ac-
count when making recommendations to the competent
election bodies (Item 5.4.1 sentences 2 and 5 DCGK)
The Supervisory Board has resolved to refrain from set-
ting any general limitation in view of the length of mem-
bership in the Supervisory Board. A general limit applying
to all members would not take into account individual
factors justifying longer membership of individual Super-
visory Board members.
4) Disclosure of relationships between supervisory board
candidates and the company, its executive bodies and
with shareholders holding a material interest in the com-
pany, in election recommendations to the annual general
meeting (Item 5.4.1 sentence 8 DCGK)
In its election recommendations to the Annual General
Meeting, the Supervisory Board will disclose all legally
required information concerning Supervisory Board
members and also introduce the candidates at the An-
nual General Meeting where possible. Furthermore,
shareholders will at the Annual General Meeting be given
an opportunity to ask questions concerning the candi-
dates. In the opinion of the Supervisory Board, this will
provide the shareholders with a solid and adequate basis
of information for assessing the proposed candidates.
5) Individualized disclosure of supervisory board com-
pensation (Item 5.4.6 sentences 5 and 6 DCGK)
The compensation granted to the members of the Super-
visory Board, and the payments made by the Company
to the members of the Supervisory Board for services
provided personally, are not individually itemised in the
notes or the Management Report (Item 5.4.6 sentences 5
and 6 DCGK). This information is not individually itemised
because the competitors of Axel Springer SE do not
publish any individual compensation either. Additionally,
the Articles of Association of Axel Springer SE do not
regulate the individual distribution of compensation be-
tween the Supervisory Board members. Rather, it ex-
pressly assigns the responsibility for this to the Superviso-
ry Board; the individualized disclosure of the Supervisory
Board compensation would undermine such assignment
of competence by the Annual General Meeting. Further-
more, the Company's Annual General Meeting resolved
on 16 April 2014 that no details of the individual compen-
sation of members of the Executive Board will be dis-
closed in the Company’s stand-alone and consolidated
annual financial statements to be prepared for financial
years 2014 to (and including) 2018 so that, for the sake of
consistency, the individual compensation of the Supervi-
sory Board members is neither disclosed in itemised form.
II. Retrospective section
In the time since issuance of the latest Declaration of
Conformity on 09 November 2015, the Company has
followed the recommendations of DCGK as amended on
05 May 2015 and published by the German Federal
Ministry of Justice in the official announcements section
of the Federal Gazette of 12 June 2015, with the excep-
tion of the deviations set out and reasoned above under I.
1 through I. 5., and in addition the following deviation:
1) Chairman of the Audit Committee (Item 5.3.2 sentence
3 DCGK)
The Audit Committee of the Supervisory Board is chaired
by Mr Lothar Lanz, a former Executive Board member of
the Company whose appointment ended less than two
years ago at the time of his election in April 2014.
The Supervisory Board is convinced that Mr Lanz is
particularly suitable as Chairman of the Audit Committee
by virtue of his long-standing experience as CFO, his
special expertise and his personality. The Supervisory
Board has therefore been and is of the opinion that Mr
Lanz should chair the Audit Committee.
Berlin, 2 November 2016
Axel Springer SE
The Supervisory Board
The Executive Board”
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Corporate Governance Report
The Declaration of Conformity from November 2, 2016
can, just like previous versions, also be seen via the link
www.axelspringer.com/declarationofconformity.
Important management practices
Axel Springer is the only independent digital publisher
that has provided itself with a corporate constitution. This
is anchored in Article 3 (“Principles of Corporate Govern-
ance”) of the company’s Articles of Incorporation and is
thus a guiding principle for all employees. The five princi-
ples formulated therein form the basis for the company’s
journalistic practices. They express fundamental convic-
tions of corporate social policy, but do not dictate per-
sonal opinions. In view of the increasing internationaliza-
tion, an internationally valid variant of these so-called
essentials was introduced in 2016, which is intended to
give Axel Springer employees worldwide guidance.
Axel Springer has also defined corporate values as the
foundation of its corporate culture, to guide the work of
every employee. They are: creativity as the crucial pre-
requisite for success in journalism and business; entre-
preneurship in the sense of being courageously inventive,
self-reliant and results-oriented, qualities that are ex-
pected of all managers and employees; integrity in all
dealings with the company, readers, customers, em-
ployees, business partners, and shareholders. The man-
agement principles, which are built on company values,
should give management a concrete framework that
creates transparency regarding the requirements and
expectations of management roles.
In addition, Axel Springer had already introduced guide-
lines for ensuring journalistic independence back in 2003.
These guidelines substantiate and expand on the profes-
sional ethics of the press as set out by the German Press
Council in conjunction with the press associations in the
publishing principles (Press Code), and which Axel
Springer voluntarily commits with regard to printed com-
plaints (see Section 16 of the Press Code). Axel Springer
specifically delineates the boundaries between advertis-
ing and editorial copy, and between the editors’ and
reporters’ private and business interests. It also pre-
cludes actions in pursuit of personal advantages and
defines the company’s position with respect to the
treatment of news sources. The guidelines thus repre-
sent the framework for independent and critical journal-
ism in the editorial departments of all media belonging to
the Group. The editors-in-chief are responsible for ob-
serving and implementing the guidelines in the compa-
ny’s day-to-day activities.
Furthermore, Axel Springer has developed a catalog of
social standards applicable to all the company’s activities.
Known as the International Social Policy, it states the
company’s positions on matters of human rights, adher-
ence to the rule of law, the protection of children and
young people, the treatment of employees, equal oppor-
tunities, health and safety, and the compatibility of work
and family, and other matters.
The company has further issued an Environmental Guide-
line comprising four points, which serves as a practical
guide to the many environmental protection measures
conducted at Axel Springer; the company also publishes
a sustainability report every two years which follows the
criteria catalog of the “Global Reporting Initiative“ (GRI),
including the “Media Sector Supplement“ (GRI+).
The management principles and guidelines of Axel
Springer can be found at www.axelspringer.com/-
corporateprinciples.
In addition, Axel Springer maintains a Corporate Govern-
ance, Risk & Compliance department. This supports
within the framework of Coporate Governance, subsidiar-
ies and central divisions in responsibly handling risks via
approaches and requirements, amongst other things, for
a comprehensive risk management system, an internal
control system, and a compliance management system.
As described in the report on risks and opportunities (see
page 42 – et seqq.), risk management and the internal
control system seek to identify, analyze and assess,
manage and report on risks at Axel Springer and to sys-
tematically monitor the measures taken to minimize risks.
At Axel Springer, compliance means the fulfillment of all
laws, regulations, and guidelines, as well as the commit-
ments undertaken voluntarily. Violations of these regula-
tions can cause sustained economic damage to the
company, resulting in civil and criminal consequences as
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Combined Management Report
Corporate Governance Report
well as damage to reputation. Against this backdrop, the
goal of compliance management is to institute structures
and processes to ensure that all directors and employees,
and senior executives, conduct themselves preventively in
accordance with applicable laws and regulations.
As part of the Compliance Organization, Axel Springer
has had a binding Code of Conduct since 2011. This is
to be understood as a summary of all the behavioral
rules of Axel Springer. It contains the existing corporate
principles and values, the journalistic guidelines and the
management principles. In addition to this higher-level
Code, the current Group Directives provide detailed rules
for individual business and procedural practices. The
Code of Conduct specifies the ethical, moral and legal
requirements to be observed by every employee and
provides a reliable orientation for loyal action. The Code
of Conduct can be found at www.axelspringer.de/coc_en.
In order to further strengthen good corporate govern-
ance and effective compliance management, an elec-
tronic whistleblower system was introduced in addition
to the existing reporting channels in the 2015 financial
year. This allows both employees and external persons
to provide confidential and, if desired, anonymous infor-
mation about suspected or actual violations and mal-
functions, thus contributing to the prevention and clarifi-
cation of compliance violations. The electronic
whistleblower system can be accessed at
www.axelspringer.de/whistleblower.
Procedures of the Executive Board and Supervisory
Board, and composition of the committees of the
Supervisory Board
Cooperation between the Executive Board and
Supervisory Board
The management and supervision of the company, which
is organized in the legal form of a European company
(Societas Europaea SE) are carried out by means of a dual
board system. The Executive Board manages the compa-
ny under its own responsibility. The Supervisory Board
appoints the members of the Executive Board, and moni-
tors and advises the latter in the conduct of the business.
The two boards work closely together in an atmosphere of
trust and confidence to sustainably enhance the compa-
ny’s value. The two boards are strictly separated in terms
of personnel and their areas of authority.
Procedures of the Executive Board
In its executive function, the Executive Board is obligated
to pursue the interests of the company and dedicated to
sustainable company development. It develops the stra-
tegic orientation of the company and is responsible for its
implementation in coordination with the Supervisory
Board. The Executive 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 information
to the Supervisory Board on all relevant matters of strate-
gy, planning, business development, risk management
including the risk situation, as well as the internal control
system and compliance management system. In accord-
ance with the internal rules of procedure adopted by the
Supervisory Board, important decisions of the Executive
Board or specific cases require the approval of the Su-
pervisory 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 financial plan.
The members of the Executive Board are jointly respon-
sible for the management, work together collegially, and
keep each other informed of important measures and
business transactions in their business divisions. Not-
withstanding the general responsibility of all Executive
Board members, each member of the Executive Board
manages the business division assigned to him, under
his own responsibility, with the exception of those deci-
sions that are incumbent on the full Executive Board.
The Executive Board meets regularly in the form of Ex-
ecutive Board meetings, which are convened and
chaired by the Executive Board Chairman, as a general
rule. Furthermore, every Executive Board member and
the Chairman of the Supervisory Board are entitled to
convene a meeting.
The Executive Board aims to ensure diversity with regard
to the staffing of leading positions within the company; the
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Corporate Governance Report
Executive Board has set targets for the proportion of
women holding management positions in the two levels
beneath the Executive Board; for more information see
page 73.
As a general rule, the full Executive Board adopts resolu-
tions by a simple majority of the votes cast; in the case
of resolutions adopted by a simple majority, the Chair-
man casts the deciding vote. A resolution adopted in
spite of being opposed by the Chairman and Chief Ex-
ecutive Officer is deemed to be invalid, also subject to
the limits of the applicable laws.
Rules of procedure issued from the supervisory board
for the executive board regulate the particulars. These
include among others
the obligation to observe and comply with the corpo-
rate constitution and to anchor it throughout the
Group,
the executive organization chart and the decisions to
be made by the full Executive Board,
the duties of the Chairman of the Executive Board,
transactions that require the approval of the Supervi-
sory Board,
rules concerning the regular, timely, and comprehen-
sive provision of information to the Supervisory Board,
rules concerning meetings and the adoption of resolu-
tions,
obligation to disclose conflicts of interest.
The Executive Board of the company currently consists
of four members:
Dr. Mathias Döpfner, Chairman and Chief Executive
Officer
Jan Bayer, President Paid Models
Dr. Julian Deutz, Chief Financial Officer
Dr. Andreas Wiele, President Marketing and Classified
Ad Models
Procedures of the Supervisory Board
As per the company’s Articles of Incorporation, the Su-
pervisory Board of Axel Springer SE is composed of nine
members, who are elected by the annual shareholders’
meeting. The regular 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 Supervisory Board Chairman coincide with that of the
Supervisory Board. The Supervisory Board advises the
Executive Board and monitors the work of the Executive
Board. It holds at least four meetings a year. In case of
necessity, it meets without the Executive Board in attend-
ance. Meetings may be held and resolutions adopted
also by way of written correspondence, telephone calls,
faxes, or electronic media. As a general rule, the Supervi-
sory Board adopts resolutions by a simple majority of the
members voting on the resolution; in case of a tie, the
Chairman casts the deciding vote. The Supervisory Board
deliberates on the company’s business developments,
planning, strategy, and significant capital expenditures at
regular intervals. The Supervisory Board adopts the sepa-
rate financial statements of Axel Springer SE and ap-
proves the consolidated financial statements of the Group.
It regularly assesses the efficiency of its work. Please refer
to the report of the Supervisory Board for additional in-
formation on the specific activities of the Supervisory
Board in the financial year 2016 (see Page 83).
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The internal rules of procedure of the Supervisory Board
comply with the requirements of the German Corporate
Governance Code and contain rules covering the follow-
ing topics, among others:
Election and duties of the Chairman and Vice Chair-
man of the Supervisory Board
Calling of meetings
Adoption of resolutions at meetings or by voting by
way of written correspondence, telephone calls, fax,
or electronic media
Supervisory Board committees, including their com-
position, organization, and duties
Obligation to disclose conflicts of interest
The members of the Supervisory Board are:
Dr. Giuseppe Vita, Chairman
Dr. h. c. Friede Springer, Vice Chairwoman
William E. Ford
Oliver Heine
Rudolf Knepper
Lothar Lanz
Dr. Nicola Leibinger-Kammüller
Prof. Dr.-Ing. Wolfgang Reitzle
Martin Varsavsky
After Prof. Dr. Lepenies resigned from office with effect at
the end of July 31, 2016, Mr. William E. Ford was ap-
pointed as a member of the Supervisory Board by order
of the District Court of Charlottenburg from August 2016.
72
The term of office of all other current Supervisory Board
members ends at the end of the annual shareholders'
meeting in 2019.
The requirements for expertise and independence within
the meaning of section 100 para. 5 1. Var.AktG (financial
experts), are met among others by the Chairman of the
Supervisory Board, Dr. Giuseppe Vita, and Lothar Lanz,
who chairs the Audit Committee. In addition, the mem-
bers of the Supervisory Board are, in accordance with
section 100 para. 5 2. Var. AktG know in its entirety the
sector in which the company operates.
Composition and procedures of committees
The Executive Board has not formed committees.
In accordance with its internal rules of procedure, the
Supervisory Board has formed four committees to sup-
port 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 internal 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 internal rules of procedure of the Super-
visory Board. The internal rules of procedure of the Su-
pervisory Board stipulate the procedures for meetings
and resolutions adopted by the committees and define
their areas of responsibility.
Please refer to the Report of the Supervisory Board (see
page 85) for information on the areas of responsibility
and composition of the committees.
Lothar Lanz is the Chairman of the Audit Committee of
the Supervisory Board; according to the Supervisory
Board, Mr. Lanz is particularly suited to the Audit Com-
mittee due to his many years of experience as Chief Fi-
nancial Officer, his special expertise and his personality.
He satisfies the requirements of expert knowledge and
independence within the meaning of Article 9 para 1 letter
c) ii) SE-VO in conjunction with Section 107 paras 4, 100
para. 5 AktG (financial expert), and the requirements of
Annual Report 2016
Axel Springer SE
Combined Management Report
Corporate Governance Report
the recommendations in Section 5.3.2 Sentence 2 (ex-
pertise) and Sentence 3. Var.1 (independence) and, since
the 17th of April, 2016, Sentence 3 Var. 2 (Executive
Board mandate ended more than two years ago) DCGK.
Provisions to promote the participation of women
in management positions according to Section 76 (4)
and Section 111 (5) of the German Stock Corpora-
tion Act (“AktG”)
Since 2010, Axel Springer has pursued a Group-wide
strategy to promote diversity; reference is made to page
36 of the Annual Report with regard to the company’s
personnel policies designed to assure equal opportunity
and diversity as well as the Group-wide targets to in-
crease the proportion of women at all management
levels, as a company-wide average.
In addition to this voluntary Group-wide commitment, the
law for the equal participation of men and women in
management positions in the private and public sector
(Gesetz für die gleichberechtigte Teilhabe von Frauen und
Männern an Führungspositionen in der Privatwirtschaft
und im öffentlichen Dienst), introduced in May 2015 in
Germany, also obliges certain companies, including Axel
Springer SE, to set targets for the proportion of women
acting on the Supervisory Board, Executive Board and
the two management levels beneath the Executive Board,
and specify when the respective proportion of women
should be achieved. As the statutory minimum share of
30 % of women and 30 % of men is not applicable to the
Supervisory Board of Axel Springer SE for the replace-
ment of vacating Supervisory Board mandates, the Su-
pervisory Board itself must set a target size.
Accordingly, the Supervisory Board of Axel Springer SE
decided on September 2, 2015, to set targets with re-
gard to the proportion of women’ on the Supervisory
Board, and the Executive Board of Axel Springer SE
each with a deadline of implementation of no later than
June 30, 2017. The respective target values are 22.2 %
(Supervisory Board) and 0 % for the proportion of women
on the Executive Board of Axel Springer SE. This deter-
mines the current status at the time the resolution was
passed. For more information regarding the reasons
behind this see page 74 (left-hand column) and 74 (right-
hand column) of the Annual Report.
The Executive Board of Axel Springer SE passed a reso-
lution on May 11, 2015, to set a target of 25 % and a
deadline for implementation of no later than June 30,
2017, for the first and second management levels of the
company beneath the Executive Board; at the time the
targets were set, the proportion of women in the first
management level beneath the Executive Board was
22.6 %, and 19.5 % in the second management level
beneath the Executive Board at Axel Springer SE.
Of course, these targets do not preclude any additional
increase within the first deadline for implementation in
the proportion of women on the Supervisory Board and
Executive Board as well as at the first two management
levels beneath the Executive Board at Axel Springer SE.
Further information on corporate
governance
Goals for the composition of the Supervisory Board
The Supervisory Board of Axel Springer SE has decided
the following objectives for its composition, in particular
with respect to Section 5.4.1 of GCGC:
The Supervisory Board of Axel Springer SE should be
composed in such a way that its members generally
possess all knowledge, abilities, and professional ex-
perience necessary to properly perform the duties of
the Supervisory Board.
With due consideration given to the company’s busi-
ness object and purpose set forth in the Articles of In-
corporation, the size of the company, and the relative
importance of its international activities, the Supervi-
sory Board will also strive, as a goal for the upcoming
regular elections, to bring about a composition of its
members that is appropriate in view of the following
considerations, in particular:
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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 reason
of relevant experience in international business).
Supervisory Board members should not hold any
position on a board or perform any consulting work
for important competitors of the company.
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. Accordingly,
and given the fact that no regular Supervisory Board
elections were held within the agreed legal maximum
permitted period until June 30, 2017, the statutory
target for the women share in the Supervisory Board
of Axel Springer SE was also fixed at 22.2 %.
In making nominations, due consideration should be
given to the general rule that Supervisory Board
members should not be older than 72 years; the Su-
pervisory Board can approve exceptions to this policy.
Furthermore, the Supervisory Board should ensure
that as few members as possible are subject to a po-
tential conflict of interests. Furthermore, the Supervi-
sory Board should give due consideration to the prin-
ciple that its composition should meet the criterion of
diversity.
With respect to its composition, the Supervisory
Board adopted the goal that at least two of its mem-
bers will be independent according to the definition of
the GCGC.
However, the Supervisory Board decided not to define a
regulatory limit with regard to the length of membership
of the Supervisory Board, despite the recommendation
stated in Section 5.4.1 sentences 2 and 5 of the GCGC.
A fixed regulatory limit fails to take into account individual
factors that may justify an extended length of member-
ship for individual Supervisory Board members (for more
information regarding this see the deviation declared in
the Declaration of Conformity of November 2, 2016, see
page 67).
The foregoing principles have already been completely
implemented with the current composition of the Super-
visory Board of Axel Springer SE.
With regard to its proposals on the election of new Su-
pervisory Board members, the Supervisory Board shall
make sure that the respective candidates are able to put
aside the expected amount of time.
Goals for the composition of the Executive Board
The Supervisory Board has decided on the following
objectives for the composition of the Executive Board of
Axel Springer SE, in particular with respect to Section
5.1.2 of GCGC:
In making decisions concerning the composition of
the Executive Board, the Supervisory Board should
give due consideration to the principle for diversity
and should strive in particular to give appropriate con-
sideration to women. In this context, the Supervisory
Board has also complied with its statutory obligation
to establish a target for the proportion of women on
the Executive Board with a conversion period up to
June 30, 2017, see page 73. At the time the target
was set, the Supervisory Board had not planned to
make any changes to the staffing of the Executive
Board, as was also the case as at the time of report-
ing; the Supervisory Board believes that the Executive
Board was and currently is well-staffed. As a result,
the Supervisory Board initially adopted a target of 0 %.
However, an increase in the proportion of women on
the Executive Board cannot of course be ruled out
within the deadline for implementation, should there
be any need to make an appointment to the Executive
Board.
The Supervisory Board should work together with the
Executive Board to assure long-term succession
planning.
At the time of being (re-)appointed to the Executive
Board, no member should be older than 62 years, as
a general rule; the Supervisory Board can approve
exceptions to this rule.
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Goals concerning the staffing of key functions
In view of the recommendation set out in Section 4.1.5
of the GCGC, reference is made to the description of
personnel policies designed to assure equal opportunity
and diversity on page 36 of the present Annual Report,
and to the stipulated targets in both of the management
levels of the company beneath the Executive Board on
page 73 of the present Annual Report.
Shareholders and annual shareholders’ meeting
The annual shareholders’ meeting is the central organ via
which Axel Springer SE shareholders can exercise their
rights and their voting rights. Every share confers the right
to cast one vote in the annual shareholders’ meeting.
Those shareholders who are registered in the share regis-
ter and have registered for the meeting in time are entitled
to vote. The Chairman of the Supervisory Board generally
chairs the shareholders’ meeting. To make it easier for
shareholders to exercise their prerogatives at the annual
shareholders’ meeting, their votes can be cast by author-
ized proxies. Axel Springer SE also designates a voting
proxy whom shareholders can elect to execute their
voting rights according to their instructions. All required
reports and documents are made available to the share-
holders 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 Executive Board and Supervisory
Board, the election of the Supervisory Board, the elec-
tion of the independent auditor, and other matters legally
assigned to them, such as corporate actions and other
amendments to the Articles of Incorporation. The resolu-
tions of the annual shareholders’ meeting require a sim-
ple majority of the votes cast, unless another majority is
prescribed by law or by the company’s Articles of Incor-
poration. The Articles of Incorporation can be inspected
on the company’s website.
Conflicts of interest
The members of the Executive 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.
Executive 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 Executive Board require the consent of the Superviso-
ry Board. Executive Board members are subject to a
comprehensive anti-competition clause during the period
of their activity for Axel Springer. Every Executive Board
member must inform the Supervisory Board of any con-
flict of interest without delay. No conflicts of interest arose
within the Executive Board in the financial year.
Also, every member of the Supervisory Board must
inform the Supervisory Board immediately of any con-
flicts of interest that may arise. In the annual sharehold-
ers' meeting, the Supervisory Board reports on all con-
flicts of interest and how to treat them.
No conflicts of interest arose within the Executive Board
in the financial year.
Memberships on other supervisory bodies
A summary of the seats held by the Executive Board and
Supervisory Board members of Axel Springer SE on other
legally prescribed supervisory boards or comparable
boards in Germany and abroad can be found on page 173.
Transparency
Axel Springer is committed to always providing compre-
hensive and consistent information in a timely and simulta-
neous manner 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 finan-
cial statements press conference, and in its semi-annual
financial report and quarterly financial statements. For this
purpose, the company also uses Internet communication
channels whenever possible. Axel Springer also regularly
participates in conferences and roadshows in key interna-
tional financial centers; additional information on this sub-
ject can be found on page 8 of the present 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.
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In order to ensure equal treatment of all capital market
participants, Axel Springer also publishes information
relevant to the capital markets simultaneously in German
and English on the company’s website. Financial report-
ing dates are published in the financial calendar with
sufficient advance notice. Immediately 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 Sec-
tion 26 of the German Securities Trading Act (Wert-
papierhandelsgesetz, WpHG), and on the purchase and
sale of shares by persons who exercise management
duties at Axel Springer (directors’ dealings), in accord-
ance with Article 19 of the Market Abuse Regulation.
Shareholdings
The Executive Board members in office at the reporting
date directly or indirectly held 3,543,267 shares of Axel
Springer SE at the reporting date of December 31, 2016.
Of that number, 3,417,995 shares were held directly or
indirectly by the Chairman of the Executive Board,
Dr. Mathias Döpfner.
At the reporting date, the Supervisory Board members
directly or indirectly held a total of 56,577,580 shares of
Axel Springer SE. 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 5,502,450 shares directly.
Preparation and audit 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 quarterly
statement is also prepared on the basis of IFRS. The
consolidated financial statements also contain the dis-
closures prescribed by Section 315a Para 1 HGB. The
consolidated financial statements are prepared by the
Executive Board of Axel Springer SE and audited by the
independent auditor. Axel Springer publishes the consol-
idated financial statements within 90 days and the quar-
terly statements as well as the interim financial report
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 Commit-
tee without delay of any circumstances arising during the
course of the audit that would constitute grounds for
disqualification or partiality. It is also agreed that the
independent auditor 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 Supervisory 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 Executive
Board and Supervisory Board according to Section 161
AktG. In addition, the Audit Committee has established a
system for monitoring and approving non-audit services
by the auditor.
Compensation report
Axel Springer’s compensation policy follows the principle
of granting compensation to the Executive Board and
Supervisory Board that is based on their performance in
the interest of sustainable corporate development.
Executive Board
In accordance with the requirements of the German
Stock Corporation Act and the recommendations of
GCGC, the compensation of the Executive Board mem-
bers consists of fixed and variable components. The
variable compensation is composed of a cash compo-
nent paid in the form of an annual bonus and long-term
compensation components in the form of virtual share
option plans and a long-term incentive plan. All compo-
nents of compensation are appropriate, both individually
and as a whole. The Supervisory Board has considered
at length the appropriateness and adequacy of the Ex-
ecutive Board compensation by taking into account a
number of criteria, including in particular Section 87 of
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Corporate Governance Report
the German Stock Corporation Act (“AktG”) and Section
4.2.2 sentences 4 and 5 of the GCGC, such as infor-
mation about the tasks of an individual Executive Board
member, his personal performance and the economic
position, success and future prospects of Axel Springer.
Due consideration is also given to the industry environ-
ment. However, the requirement for a continuous sepa-
rate examination of the comparability of Executive Board
compensation with the compensation of senior man-
agement and the workforce as a whole is waived, see
corresponding declaration regarding exception to the
recommendation made in Section 4.2.2 sentence 6 of
the GCGC in the Declaration of Conformity dated No-
vember 2, 2016, page 67 of the Annual Report.
In the reporting year, the Supervisory Board consulted an
independent external compensation expert.
The fixed compensation corresponds to the annual
fixed salary; in addition, the Executive Board members
receive a company car or company car allowance, the
assumption of premiums for insurance against the risk of
invalidity and death, individual travel and security ex-
penses as fringe benefits. The annual fixed salary is
generally established for the entire term of an employ-
ment agreement and is disbursed in 12 monthly install-
ments. When determining the fixed salary, the Superviso-
ry Board orientates itself, among other things, on the
tasks of the individual Executive Board member, the
current economic situation, the success and the pro-
spects for the future of the Group.
The variable compensation is in the form of an annual
bonus as a cash component, and depends on individual
performance with regards to individual objectives (relat-
ing to the quantitative divisional objectives and qualitative
individual objectives, amongst others, based on the
strategy of Axel Springer SE) as well as Group objectives;
it is limited to double the sum payable for 100 %
achievement of objectives. The Group's target for the
year 2016 and the previous year was Group EBITDA.
Individual objectives for measuring performance of indi-
viduals and Group objectives are decided upon by the
Supervisory Board. Part of the variable cash component
is based on annual objectives and in part based on
achievement of Group objectives established for an
assessment period of three years. Achievement of objec-
tives is initially established by the Supervisory Board
members and chairman with the relevant Executive
Board member and then reviewed and finalized by the
Supervisory Board.
In addition, there is a long-term variable compensa-
tion component in the form of virtual stock option,
plans, which were last granted stock options in 2014
and whose main parameters are as follows:
Executive Board
Program
Grant date
Term in years
Vesting period in years
2012
2014 I
2014 II
01.01.2012 01.01.2014 01.09.2014
6
4
6
4
6
4
Stock options granted
450,000
205,313
675,000
Underlying (€)
Maximum payment (€)
Value at grant date (€)
Total value at grant date
(€ millions)
30.53
61.06
5.26
44.06
88.12
6.69
44.56
89.12
6.26
2.4
1.4
4.2
If the Executive Board service agreement or the ap-
pointment to the Executive Board exists for at least the
end of the four year waiting period, then all virtual stock
options may become vested to the member of the Exec-
utive Board. If the working relationship or the appoint-
ment of the authorized member of the Executive Board
finishes before the end of the waiting period, but is at
least one year after the grant date, then the stock op-
tions generally become vested pro rata temporis relating
to the waiting period.
A further condition for vesting to take place is that either
the volume-weighted average price of the Axel Springer
share is at least 30 % over the base value or that the
percentage increase of this average price exceeds that
of the base value of the development of the DAX over a
period of 90 calendar days within a time period of a year
before the end of the waiting period.
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Exercising stock options is only possible if the volume-
weighted average price of the Axel Springer share 90
calendar days before exercising such options is at least
30 % over the base value and that the percentage in-
crease exceeds that of the DAX index. Each option
grants a payment claim in the amount of the growth in
value of the Axel Springer share, restricted to a maxi-
mum of 200 % of the base value, which corresponds to
the difference between the volume-weighted average
price during the last 90 calendar days prior to exercise
and the base value.
Executive Board members are obligated to hold one Axel
Springer share 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 same rate.
The 2012 Executive Board Program was completed
during the financial year as the remaining options were
exercised.
As of May 1, 2016, current members of the Executive
Board were granted a new long-term variable remu-
neration in the form of a long-term incentive plan
(“LTIP“) with a duration – including lock-up periods –
until 2023. The LTIP stipulates a participation in the
increase in the company value, measured on the basis of
market capitalization.
It will be distributed in the form of a cash bonus and
contains a subsequent obligation to purchase Axel
Springer shares in the corresponding amount. The com-
pensation entitlement requires market capitalization of
Axel Springer SE to increase by at least 40 % within three,
four, and maximally five years (respective performance
periods). No claim for compensation can be made below
this threshold. In the event of targets being achieved, the
whole Executive Board is entitled to payment amounting
to a total of 4 % of the increase in market capitalization.
The compensation entitlement will increase only up to a
growth in market capitalization by maximally 60 %.
The increase in market capitalization will be calculated on
a basis of share price developments of the Axel Springer
share within the last 90 calendar days before May 1,
2016, or before the end of the respective performance
period, multiplied by the number of outstanding Axel
Springer shares (less treasury shares) adding dividend
payments during the performance period.
In the event of targets being achieved, an amount in the
value of 50 % of the total amount (“payout amount I“) will
be paid out. On meeting the targets after four or five
years respectively, a lock-up period of two or one year
respectively follows, before the remaining 50 % of the
total amount (“payout amount II“) will be paid out. Should
targets be met prematurely after three years, each Exec-
utive Board member will have the option to request
payout amount I. Payout amount II will then only be
remunerated after targets are once again met after four
or five years, and after a lock-up period of two, or one
year respectively.
The net amount of all payouts (after the Executive Board
member's taxes and duties are paid) in each case has to
be fully invested in Axel Springer shares by the Executive
Board member. Regarding the shares acquired with pay-
out amount I, or II respectively, the Executive Board mem-
ber has to retain the shares for a minimum of two years, or
one year respectively. The LTIP contains the usual provi-
sions for early resignation. Thus, for instance all non-
contractual claims paid under the LTIP lapse if the mem-
ber of the Executive Board leaves the Executive Board at
his own request before expiry of the waiting period.
The LTIP is valued as a share-based compensation
program with cash settlement at its fair value as of the
balance sheet date and is recorded according to the
expected vesting date.
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Corporate Governance Report
The value of the LTIP at the grant date was calculated on
the basis of a stochastic model for the valuation of stock
option rights taking into account the seven-year term of
the LTIP (including holding periods) and is determined at
€ 32.1 million.
With regards to the Executive Board Programs that are
granted, see the information in the notes to the consoli-
dated financial statements under Section (13).
Executive Board members have received contractually-
agreed pension provisions. Payment of pension applies
when reaching the age of 62, provided that the Executive
Board member is no longer at their post at this point. In
case of premature departure the Executive Board mem-
ber has – after five years since the pension entitlement or
earlier employment with the company – a vested claim to
a pension payment proportional to the length of his em-
ployment with the company. Payments are also made in
case of a complete reduction in earning capacity.
Executive Board members have the right to terminate
their employment contracts in the event of a change of
control. In such a case, they will have the right to receive
payment of their base salary for the most recently nego-
tiated remaining contractual term (some of the eligible
Executive Board members will have the right to receive
payment of an amount equal to at least one year’s base
salary) and/or a lump sum amounting to the total remu-
neration for the duration of the original residual term; the
amount of the aforementioned payments is typically
limited. 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
employment contracts of the members of the Executive
Board do not provide for any other compensation if the
employment relationship is terminated as a result of a
change in control.
In financial year 2016, the total remuneration of the
Executive Board (excluding LTIP) amounted to
€ 19.2 million (PY: € 18.9 million). The fixed components
totaled € 9.1 million (PY: € 8.7 million); this figure also
includes components for fringe benefits (company car or
company car allowance, the assumption of premiums for
insurance against the risk of invalidity and death and
security expenses). The variable cash component came
to a total of € 10.1 million (PY: € 10.2 million). According
to this, the fixed compensation including fringe benefits
in the financial year amounts to a proportion of 47 % (PY:
46 %) of total remuneration (excluding LTIP). In addition,
a long-term variable remuneration was granted in the
form of an LTIP, the value of which was determined at
the grant date on the basis of a stochastic model for the
valuation of stock options taking into account the seven-
year term (including holding periods) and amounted to
€ 32.1 million.
Guaranteed pension payments to members of the Exec-
utive Board resulted in a personnel expense of
€ 2.3 million in financial year 2016 (PY: € 0.8 million).
The cash value of the guaranteed pension payments in
pension provisions totaled € 15.2 million (PY: € 11.4
million). Loans or advances were not granted to mem-
bers of the Executive Board in the 2016 financial year. In
the case of guaranteed pension payments to Executive
Board members, which became effective with the rele-
vant recommendation in Section 4.2.3 sentence 10
GCGC on June 10, 2013, the Supervisory Board estab-
lished the pension level desired in compliance with the
previously stated Code recommendation and considered
the annual and long-term expense for the company
derived from this.
Axel Springer SE does not disclose the total compensa-
tion of individual Executive Board members by name,
given that Sections 314 Para. 3 and 286 Para. 5 HGB
expressly place the disclosure of Executive Board com-
pensation by name under the reservation of a differing
resolution of the annual shareholders’ meeting with a
qualified majority of the share capital represented upon
the adoption of the resolution. The annual shareholders’
meeting of Axel Springer SE passed a resolution on April
16, 2014 with the required majority.
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Corporate Governance Report
circumvent this allocation of responsibilities to the annual
shareholders’ meeting. The annual shareholders’ meet-
ing of the company also passed a resolution on April 16,
2014, stopping the disclosure of the individual compen-
sation of the members of the Executive Board in the
Company's annual financial and annual consolidated
financial statements for the financial years 2014 through
2018 (included), meaning therefore that the compensa-
tion of Executive Board members is not published in
individualized form either.
Share-based compensation of senior executives
Axel Springer has issued virtual stock option plans for
selected senior executives, the main parameters of
which are shown in the following:
Senior Executive Program
Grant date
Term in years
Vesting period in years
Stock options granted
Underlying (€)
Maximum payment (€)
Value at grant date (€)
Total value at grant date
(€ millions)
2011 II
2014
01.10.2011 01.03.2014
6
4
5
3
472,500
60,000
35.00
70.00
2.31
46.80
93.60
8.14
1.1
0.5
Provided that the beneficiary is employed by the compa-
ny at least until the expiration of the respective vesting
period, all virtual stock options granted to the relevant
senior executives may become vested. If the authorized
senior executive is not employed by the company before
the end of the vesting period, but is at least one year
after the grant date, the stock options are vested up to
one half (Senior Executive Programs 2014) or to one
quarter per elapsed year of the vesting period (Senior
Executive Program 2011 II).
Supervisory Board
The compensation of the Supervisory Board is set by the
annual shareholders’ meeting.
The compensation of the Supervisory Board of Axel
Springer SE is regulated by Article 16 of the Articles of
Incorporation of Axel Springer SE. According to this, the
Supervisory Board of Axel Springer SE receives fixed
compensation of € 3.0 million annually. The Supervisory
Board decides how the aforementioned amount is dis-
tributed among its members, with appropriate considera-
tion given to their activities as chairman and in the com-
mittees. If the member does not serve on the
Supervisory Board or exercise a higher-paying function
of a Supervisory Board member for the full year, such
member will receive a pro-rated share of the full-year
compensation. Only full months of activity are taken into
account for this purpose. The compensation is payable
after the close of the given financial year.
For the financial year 2016, the Supervisory Board will
receive total compensation of € 3.0 million (PY:
€ 3.0 million). In addition, the company reimburses all
members of the Supervisory Board for their expenses
and for the value-added tax payable on their compensa-
tion and on the reimbursement of their expenses. The
company pays the premium for the D&O insurance taken
out for members of the Supervisory Board. A Superviso-
ry Board member received compensation of € 0.1 million
for services as an author in the reporting year (PY:
€ 0.1 million).
Contrary to Section 5.4.6 sentences 5 and 6 of the Ger-
man Corporate Governance Code, the compensation
paid to members of the Supervisory Board, as well as
the compensation paid by the company to them for
services rendered personally, are not presented in the
Corporate Governance Report, since Axel Springer SE’s
competitors do not disclose such information either.
Furthermore, the Articles of Incorporation of Axel Spring-
er SE do not themselves govern the individualized distri-
bution of compensation between Supervisory Board
members, but rather they expressly assign them to the
Supervisory Board; the disclosure in an individualized
manner of the Supervisory Board compensation would
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Beneficiaries are obligated to hold one Axel Springer
share for every ten stock options as their own investment.
Disposing of these shares prior to exercising the options
would result in the stock options being forfeited at the
same rate.
The Senior Executive Program 2011 II was completed
during the financial year as the stock options were exer-
cised or forfeited. With regards to the executive programs
that are granted, see the information in the notes to the
consolidated financial statements under Section (13).
A further condition for vesting to take place is that either
the volume-weighted average price of the Axel Springer
share is at least 30 % over the base value or that the
percentage increase of this average price exceeds that
of the base value of the development of the DAX over a
period of three calendar months within a time period of a
year before the end of the waiting period.
Exercising stock options is only possible if the volume-
weighted average price of the Axel Springer share during
the three calendar months before exercising such op-
tions is at least 30 % over the base value and that the
percentage increase exceeds that of the DAX index.
Each option grants a payment claim in the amount of the
growth in value of the Axel Springer share, restricted to a
maximum of 200 % of the base value, which corre-
sponds to the difference between the volume-weighted
average price during the last three calendar months prior
to exercise and the base value.
81
Report of the
Supervisory Board
Dr. Giuseppe Vita
Chairman
Dr. h. c. Friede Springer
Vice Chairwoman
Oliver Heine
Attorney at law and partner in the
law firm Heine & Partner
William E. Ford (since August 29, 2016)
CEO General Atlantic
Rudolf Knepper
Entrepreneur
Lothar Lanz
Member of various Supervisory Boards
Dr. Nicola Leibinger-Kammüller
President and Chairwoman of the Executive Board
of TRUMPF GmbH + Co. KG
Prof. Dr.-Ing. Wolfgang Reitzle
Entrepreneur
Martin Varsavsky
CEO Prelude Fertility Inc.
Prof. Dr. Wolf Lepenies (until July 31, 2016)
University Professor (emer.) FU Berlin;
Permanent Fellow (emer.) at Wissenschaftskolleg
zu Berlin
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Annual Report 2016
Axel Springer SE
Report of the Supervisory Board
In financial year 2016, 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. It worked closely and trustfully with the
Executive Board in an advisory role and supervised the
management of the company.
By means of written and oral reports, the Executive Board
informed the Supervisory Board in detail, regularly, and
promptly about all essential matters of strategy, planning,
business performance, and the risk situation of the com-
pany, as well as the risk management system, the Internal
Control System (ICS), and matters pertaining to compli-
ance. The Executive Board informed the Supervisory
Board of matters of particular importance between meet-
ings, whilst Supervisory Board members and Executive
Board members frequently consulted and exchanged
information with each other.
The Supervisory Board examined the relevant planning
documents and financial statements presented to it and
assured itself that they were correct and appropriate. It
reviewed and discussed all submitted reports and doc-
uments to an appropriate extent. It was not necessary in
financial year for the Supervisory Board to inspect com-
pany books and documents beyond those presented
during the normal course of reporting by the Executive
Board.
The Supervisory Board discussed with the Executive
Board all matters of crucial importance for the company,
especially the company’s business plan, business strategy,
major investment and disinvestment plans, and personnel
matters; the strategic orientation of the company was
coordinated between the Executive Board and Superviso-
ry Board, and the status in relation to the implementation
of the strategy was discussed. Furthermore, the Supervi-
sory Board discussed specific transactions of importance
to the company’s future development. It adopted resolu-
tions on those transactions and measures for which the
participation of the Supervisory Board is required by law,
by the company’s Articles of Incorporation, or by the
Executive Board’s internal rules of procedure.
Composition and meetings of the
Supervisory Board
As per the company’s Articles of Incorporation, the Super-
visory Board is composed of nine members (see page 72
of the Annual Report regarding the individual members of
the Supervisory Board). Prof. Dr. Wolf Lepenies resigned
from office at the end of July 31, 2016. By order of August
26, 2016, the District Court of Charlottenburg appointed
Mr. William E. Ford, CEO of General Atlantic, as a member
of the Supervisory Board. The Supervisory Board intends
to propose to the annual shareholders' meeting in 2017 to
elect Mr. Ford to the Supervisory Board, until the end of
the regular term of office of the remaining current mem-
bers of the Supervisory Board which ends with the expiry
of the 2019 annual shareholders' meeting, which is deci-
sive for the discharge for the 2018 financial year.
The Supervisory Board would like to thank Prof. Dr. Wolf
Lepenies, a deservedly retiring member of the Superviso-
ry Board for his many years as a successful member of
the Supervisory Board of Axel Springer SE. Prof. Dr.
Lepenies belonged to the Supervisory Board of our
company since April 2004. During his more than 12
years of membership, he has supported our company in
a wide variety of ways and has given important sugges-
tions on the basis of his outstanding scientific and inter-
cultural competence as a sociologist and science man-
ager as well as his membership in academic bodies in
Germany and abroad.
A total of six meetings of the Supervisory Board were
held during the period under review, four in the first and
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Annual Report 2016
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Report of the Supervisory Board
two in the second half of the calendar year, although the
meeting on April 12, 2016 was an unusual meeting in the
form of a telephone conference. At the Supervisory
Board meeting on November 2, 2016, one member
apologized for his absence, otherwise all members of the
Supervisory Board attended all meetings of the plenum.
Important matters addressed by the
Supervisory Board
At the meeting on February 11, 2016, the Supervisory
Board dealt with the financial plan 2016 presented by the
Executive Board and approved it. The Executive Board
informed the Supervisory Board about the potential
business development figures in the expired financial
year 2015. The Supervisory Board also dealt with the
possible conversion of the company into a KGaA (joint
stock company). The current status of transaction pro-
posals was discussed and the business plan of the
Company's Executive Board was also adjusted. The
Supervisory Board also passed resolutions concerning
the extension of the term of office of two members of the
Management Board.
In its meeting on March 1, 2016, the Supervisory Board
devoted its attention primarily to the separate financial
statements of the parent company and the consolidated
financial statements of the Group as of Decem-
ber 31, 2015 (including, in each case, the combined
management report and Group management report), as
well as the report on the company’s dealings with affiliat-
ed companies (Dependency Report), along with the
respective audit reports. In accordance with the recom-
mendations of the Audit Committee, the Supervisory
Board approved the annual financial statements and
consolidated financial statements, together with the
combined management report and group management
report, and approved the dependency report. It followed
the Executive Board’s profit utilization proposal for finan-
cial year 2015 and agreed to the Corporate Governance
Report issued jointly with the Executive Board. In addi-
tion, the Supervisory Board dealt with the agenda for the
2016 annual shareholders' meeting; this included inter
alia the proposals for the approval of the annual share-
holders' meeting, including the proposal for the election
of the auditor for the financial year 2016, the proposal for
the approval of the spin-off and takeover agreements for
the business areas of car, sports and computer maga-
zines and the proposal for the amendment of the com-
pany object with corresponding changes to the Articles
of Association of the Company. In addition, the Supervi-
sory Board adopted a resolution regarding its report for
the 2015 financial year which was submitted at the an-
nual shareholders' meeting. In addition, the members of
the Supervisory Board were informed of changes to the
Market Abuse Regulation, particularly with regard to
directors' dealings and closed periods.
At the special meeting on April 12, 2016, the Superviso-
ry Board dealt with the introduction of a long-term varia-
ble remuneration for the Executive Board in the form of a
so-called long-term incentive plan (“LTIP”) for the Execu-
tive Board and approved it. In addition, the Supervisory
Board approved the extension of the Executive Board's
service contracts to those members of the Executive
Board whose term of office extension it had agreed on in
its meeting on February 11, 2016.
At the meeting on April 13, 2016, the Supervisory Board
focused on the preparation of the subsequent annual
shareholders' meeting and business development in the
first quarter of the financial year.
At the meeting on September 8, 2016, the Executive
Board reported on business developments of business
as of June 30, 2016. In addition, the Supervisory Board
adopted a resolution on the Company’s share ownership
program for employees and its affiliates planned for the
2017 financial year. Following the meeting, a training
course on “Digital Media Consumption” took place.
In its meeting of November 2, 2016, the Supervisory
Board dealt primarily with and discussed the business
strategy of Axel Springer based on a comprehensive
presentation by the Executive Board. The Supervisory
Board was informed by the Chairman of the Audit Com-
mittee about the selection procedure in the year under
review with regard to the auditor. On this basis it decided
to propose to the annual shareholders' meeting 2017
that Ernst & Young Wirtschaftsprüfungsgesellschaft be
84
Annual Report 2016
Axel Springer SE
Report of the Supervisory Board
the auditor, the Group auditor and the auditor of the
semi-annual financial report, in each case for the 2017
financial year. The Supervisory Board also passed the
circular on the same day. It also carried out a self-
assessment of its efficiency and, on the basis of an in-
depth discussion, assessed its activity as still effective. In
addition, the Executive Board informed the Supervisory
Board about the economic development as of Septem-
ber 30, 2016 and the current status of the company's
transaction plans. The meeting was followed by a train-
ing session on the new electronic communication system
for the board.
Conflicts of interest
There were no conflicts of interest in the Supervisory
Board during the reporting year.
Corporate governance
The Executive Board and Supervisory Board issued their
common Declaration of Conformity (pursuant to Sec-
tion 161 of the German Stock Corporations Act (AktG))
in November 2016. This explanation with information on
exceptions to the recommendations made in the GCGC
is made permanently available on the company's website.
It is also available on page 67 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 Executive Board and Supervi-
sory Board (see page 67).
Work of the committees of the
Supervisory Board
Notwithstanding the general responsibility of the full Su-
pervisory Board, the Executive Committee is responsi-
ble for matters that are exclusively or predominantly relat-
ed to publishing and journalism and for matters of
strategy, financial planning, capital expenditures, and the
financing of investment. It is in particular responsible,
instead of the Supervisory Board, for approving significant
management actions undertaken by the Executive Board
concerning investments or operative business operations.
Finally, the Executive Committee prepares decisions
regarding the organization of the Executive Board and
takes decisions, within stipulated limits, regarding the
approval to sell shares of the company and subscription
rights to such shares. The members of the Executive
Committee are Dr. Giuseppe Vita, acting as the Chairman,
Dr. h. c. Friede Springer, acting as the Vice Chairwoman,
and Lothar Lanz and Prof. Dr.-Ing. Wolfgang Reitzle.
The Executive Committee held nine meetings during the
reporting period, of which five were extraordinary meet-
ings; members of the Executive Board also took part
frequently at these meetings. In addition, resolutions were
passed in circulation proceedings. The Presidency agreed,
among other things, the following transactions: In January
2016 the exercise of a put option against Do⁄an TV Hold-
ing A.S., in April 2016 the acquisition of up to 100 % of
the shares at Land & Leisure A/S, in June 2016 the ac-
quisition of around 93 % of the shares in the eMarketer
Inc. and the agreement of put and call options on the
remaining shares in eMarketer Inc., in September 2016
the acquisition of outstanding shares in Car&Boat Media
S.A.S., and in December the acquisition of all shares in
ShareASale.com Inc by the zanox Group and the granting
of put/call options regarding the minority interest in the
zanox Group in favor of the Company.
In the interest of performing its duties in an efficient man-
ner, the Supervisory Board has formed an Executive
Committee, an Audit Committee, a Personnel Committee,
and a Nominating Committee as permanent committees.
The Chairman of the Audit Committee is Lothar Lanz, and
in the other committees Chairman of the Supervisory
Board, Dr. Giuseppe Vita fulfills that role. The chairman of
the committee reported to the plenum on the work of the
committees and the decisions taken by the committees.
In addition, consultations were made and decided on the
submission of an offer for rights packages to the Bun-
desliga matches, the re-arrangement of existing put and
call options in Immoweb SA, the granting of approval to
conclude a contract for the development of the “Lin-
denpark” property in the immediate vicinity of the head
office in Berlin and the transfer of the minority shares to
Thrillist and NowThis in a new digital content unit. The
subject matter here was merely decisions about granting
85
Annual Report 2016
Axel Springer SE
Report of the Supervisory Board
approval to conclude control and profit and loss transfer
agreements within the Group as well as to transfer shares
in the company in accordance with Article 5 (3) of the
Company’s Articles of Incorporation. Finally, the Executive
Committee was concerned with an important staff issue
and agreed in this context to conclude a termination
agreement.
The Personnel Committee is responsible in particular for
preparing decisions on the appointment and dismissal of
Executive Board members. It is also responsible for prepar-
ing the resolutions to be adopted by the Supervisory Board
on the compensation of individual members of the Execu-
tive Board. If the Personnel Committee consists of three or
more members, then it approves resolutions in lieu of the
Supervisory Board in all other matters pertaining to em-
ployment contracts; the same applies in matters pertaining
to the extension of loans within the meaning of Sections 89,
115 AktG and on the approval of contracts with Superviso-
ry Board members pursuant to Section 114 AktG. If the
Personnel Committee consists of two members, then it is
responsible for preparing the resolutions to be adopted by
the Supervisory Board regarding such matters. To the
extent it bears responsibility, the Personnel Committee also
represents the company in transactions with individual
Executive Board members. Finally, if the Personnel Com-
mittee consists of three or more members, then it shall
decide on granting approval for management actions as-
signed to it that require approval; if it consists of two mem-
bers, then it is responsible for preparing the resolutions to
be adopted by the Supervisory Board regarding such
business matters. The members of the Personnel Commit-
tee are Dr. Giuseppe Vita, acting as the Chairman, and
Dr. h. c. Friede Springer, acting as the Vice Chairwoman.
The Personnel Committee met five times during the
reporting period. It prepared, among other things, deci-
sions of the plenum on the extension of the term of office
of two members of the Executive Board together with
the related extension of the respective Executive Board
contract and the introduction of the long-term incentive
plan for the Executive Board. It also dealt with the indi-
vidual goals and corporate goals for the cash component
of the variable compensation of the Executive Board.
The Audit Committee, notwithstanding the responsibility
of the full Supervisory Board, is responsible for preparing
the decisions to be made by the Supervisory Board 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 pre-
liminary review of the separate financial statements, the
Dependency Report, and the consolidated financial
statements, as well as the management report for the
company and the management report for the Group, the
review of the profit utilization proposal, the discussion of
the audit report with the independent auditor, as well as
the monitoring of the accounting process and the audit, in
this regard in particular the independence of the auditor,
the monitoring of the effectiveness of the risk management
system, the internal control system (ICS), the compliance
management system and the internal auditing system. The
Audit Committee also monitors and approves the non-
audit services provided by the auditor. It is also responsi-
ble for reviewing the interim financial statements and inter-
im financial reports as well as quarterly statements and for
discussing the report of the independent auditor on the
critical review of the interim financial statements. With
regard to the audit of the financial statements, the Audit
Committee is responsible for preparing the proposal of the
Supervisory Board to the annual shareholders’ meeting on
the election of the independent auditor and the engage-
ment of the independent auditor, and for adopting audit
priorities, among other matters. The Audit Committee
consists of Lothar Lanz, acting as the Chairman, Dr.
Giuseppe Vita, acting as the Vice Chairman, and Oliver
Heine, Rudolf Knepper and Dr. h. c. Friede Springer as
additional members of the Audit Committee.
The Audit Committee held five meetings during the
course of the financial year. It has been informed of the
scope, course, and result of the 2015 annual financial
statements and consolidated financial statements and
discussed them with the auditors, the decisions of the
Supervisory Board regarding adoption of the financial
statements (including the combined management report
and group management report) and prepared approval
of the Group consolidated statements as well as the
audited interim financial statements and reports for 2015.
Alongside this, in February 2016, the Audit Committee
86
Annual Report 2016
Axel Springer SE
Report of the Supervisory Board
handled preparation of the passing of the resolution by
the full board regarding the proposal at the annual
shareholders' meeting to commission the independent
auditor for the 2016 financial year. To this effect, the
Supervisory Board was also in receipt of written confir-
mation from Ernst & Young GmbH regarding their inde-
pendence. In addition, the Audit Committee dealt with
the audit priorities of the independent auditor for
the 2016 financial year and issued the auditor with the
audit assignment for the 2016 financial year. The Audit
Committee also dealt with the monitoring of the effec-
tiveness of the risk management system, the internal
control system (ICS), of the compliance management
system and of the internal audit system, as well as addi-
tional compliance issues. The Audit Committee has also
established a system for the supervision and approval of
non-audit services by the auditor.
Finally, a comprehensive selection procedure for the
appointment of the auditor for financial year 2017 was
carried out under the responsibility of the Audit Commit-
tee; the Audit Committee has dealt extensively with the
appraisal of the candidates and is convinced of the inde-
pendence of the candidates as part of its decision. The
Audit Committee found that the selection process was
transparent, fair and non-discriminatory. On the basis of
this selection process, the Audit Committee gave the
Supervisory Board a reasoned recommendation with two
proposals for the election proposal to the annual share-
holders’ meeting for the auditor of the financial year 2017.
The Nominating Committee prepares the proposal of the
Supervisory Board to the annual shareholders’ meeting on
the election of Supervisory Board members; in particular, it
proposes suitable candidates for the Supervisory Board,
also in consideration of the diversity and independence
criteria adopted by the Supervisory Board. It develops and
reviews job profiles relative to the qualifications expected of
Supervisory Board members by the company, and contin-
ually adapts them to suit changing company requirements.
The members of the Nominating Committee are Dr.
Giuseppe Vita, acting as the Chairman, and Dr. h. c. Friede
Springer, acting as the Vice Chairwoman.
The Nomination Committee met once in the year under
review and dealt with the application for the legal ap-
pointment of a member of the Supervisory Board as
successor to Prof. Dr. Lepenies. In this context, the
committee recommended to apply for the appointment
of William E. Ford as a legal substitute member and to
propose to the next annual shareholders’ meeting in April
2017 his election to the Supervisory Board.
Separate financial statements of the
parent company and consolidated
financial statements of the Group;
management report for the parent
company and 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 combined management report of
the parent company and the Group, all of which were
prepared by the Executive Board for financial year 2016,
and issued an unqualified audit opinion in every case. In
connection with the audit, the independent auditor also
noted in summary that the Executive Board has imple-
mented a risk management system that fulfills the re-
quirements of law, and that this system is generally suita-
ble 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
Executive 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 audited and discussed in
the presence of the independent auditor in the meeting
of the Audit Committee of March 6, 2017. The inde-
pendent auditor reported on the key results of the audit
and was available for additional information if required.
No deficiencies in the internal control and risk manage-
ment system, as it relates to the financial accounting
process, were noted. The independent auditor explained
further the scope, priorities, and costs of the audit. No
circumstances that would cast doubt on the impartiality
87
Annual Re
Axel Sprin
eport 2016
nger SE
of the inde
resolved to
approve th
company a
the Group,
of the pare
pendent audit
o recommend
he separate fina
and the conso
as well as the
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or arose. The A
to the Supervi
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lidated financia
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sory Board tha
ents of the pare
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tive Board also
s dealings with
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visory Board. T
of the correspo
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report on the
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airman
88
Consolidated Financial
Statements
90 Responsibility Statement
91 Auditor’s Report
92 Consolidated Statement of Financial Position
94 Consolidated Statement of
Comprehensive Income
95 Consolidated Statement of Cash Flows
96 Consolidated Statement of Changes in Equity
97 Consolidated Segment Report
Notes to the Consolidated Financial Statements
98 General information
120 Notes to the consolidated statement of
financial position
145 Notes to the consolidated statement of
comprehensive income
152 Notes to the consolidated statement of
cash flows
153 Notes to the consolidated segment report
155 Other disclosures
89
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Responsibility Statement
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 27, 2017
Axel Springer SE
Dr. Mathias Döpfner
Jan Bayer
Dr. Julian Deutz
Dr. Andreas Wiele
90
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Auditor’s Report
Auditor’s Report
We have audited the consolidated financial statements
prepared by Axel Springer SE, Berlin – comprising the
statement of financial position, the income statement,
the statement of recognized income and expenses, the
statement of cash flows, the statement of changes in
equity, and the notes to the consolidated financial state-
ments – together with the combined management report
of the Axel Springer Group and Axel Springer SE for the
fiscal year from January 1 to December 31, 2016. The
preparation of the consolidated financial statements and
the combined management report of the Axel Springer
Group and Axel Springer SE in accordance with IFRS as
adopted by the EU, and the additional requirements of
German commercial law pursuant 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 consol-
idated financial statements and on the combined man-
agement report of the Axel Springer Group and Axel
Springer SE 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 SE 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 SE 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 SE. In our opinion,
our audit provides a sufficiently sound basis for our opin-
ion.
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 posi-
tion, 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 SE is consistent with the consolidated financial
statements, complies with the legal regulations and as a
whole conveys an accurate view of the Group’s position
and accurately presents the opportunities and risks of
future development.
Berlin, February 27, 2017
Ernst & Young GmbH
Wirtschaftsprüfungsgesellschaft
Ludwig
Wirtschaftsprüfer
Mielke
Wirtschaftsprüferin
91
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Consolidated Statement of Financial Position
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 due from related parties
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
Assets held for sale
Total assets
Note 12/31/2016 12/31/2015
(4)
(5)
(6)
(7)
(37)
(10)
(27)
(8)
(9)
(37)
(10)
(30)
(2c), (11)
5,393.0
5,187.2
4,162.3
3,897.0
519.2
507.5
29.8
563.3
221.0
342.3
23.4
0.4
39.5
55.0
33.2
662.7
91.6
571.0
0.1
7.9
32.1
46.8
1,063.2
1,317.4
21.6
20.1
614.6
570.9
16.6
65.0
121.3
224.1
0.0
7.1
58.2
96.2
253.8
311.1
6,456.2
6,504.7
92
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Consolidated Statement of Financial Position
€ millions
EQUITY AND LIABILITIES
Equity
Shareholders of Axel Springer SE
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
Liabilities related to assets held for sale
Total equity and liabilities
Note 12/31/2016 12/31/2015
(12)
2,638.6
2,511.5
(14)
(15)
(16)
(37)
(17)
(27)
(14)
(15)
(16)
(37)
2,217.4
2,062.7
421.2
448.8
2,427.2
2,455.5
350.4
316.3
69.8
65.0
1,258.3
1,195.3
0.2
6.5
211.6
530.5
0.3
4.4
393.0
481.2
1,390.4
1,537.8
21.2
23.0
183.2
234.6
1.0
57.6
379.6
342.9
23.1
37.3
19.3
42.8
656.8
160.8
(17)
745.1
(2c), (11)
0.0
6,456.2
6,504.7
93
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Consolidated Statement of Comprehensive Income
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
Income from continued operations
Income from discontinued operations (after taxes)
Net income
Net income attributable to shareholders of Axel Springer SE
Net income attributable to non-controlling interests
Basic/diluted earnings per share (in €) from continued operations
Basic/diluted earnings per share (in €) from discontinued operations
€ millions
Consolidated Statement of Recognized Income and Expenses
Note
Net income
Actuarial gains/losses from defined benefit pension obligations
Items that may not be reclassified into the income statement in future periods (after taxes)
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
Items that may be reclassified into the income statement in future periods if certain criteria are met
(after taxes)
Other income/loss
Comprehensive income
Comprehensive income attributable to shareholders of Axel Springer SE
Comprehensive income attributable to non-controlling interests
(29)
94
Note
2016
2015
(19)
(20)
(20)
(21)
(22)
(23)
(24)
(25)
(26)
(27)
(2d)
(28)
(28)
3,290.2
3,294.9
339.9
271.8
82.6
47.3
– 971.5
– 1,013.5
– 1,100.1
– 1,100.3
– 232.6
– 199.8
– 851.2
– 862.2
40.2
23.4
16.8
24.7
1.7
23.0
– 21.4
– 22.2
– 126.1
– 136.2
450.0
304.6
1.9
451.9
427.3
24.6
3.94
0.02
2016
451.9
– 25.3
– 25.3
– 47.0
13.6
0.1
– 1.9
– 35.2
– 60.5
391.4
372.4
19.0
2.8
307.4
252.4
55.0
2.50
0.03
2015
307.4
24.5
24.5
60.2
12.1
0.2
– 2.6
69.8
94.3
401.7
332.6
69.1
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Consolidated Statement of Cash Flows
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,
and 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 activities1)
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
Proceeds from disposals of non-current financial assets including repayment of the vendor loan
Proceeds from/disbursements of investments in short-term financial funds
Note
(7a)
(7a)
2016
451.9
232.6
– 23.4
3.8
2015
307.4
194.9
– 1.7
3.2
– 264.3
– 127.5
7.9
– 28.7
5.2
– 41.4
13.7
1.4
358.8
68.5
74.1
318.4
– 2.7
– 22.8
2.6
– 18.2
– 39.7
15.7
55.7
369.6
61.6
157.0
71.2
3.7
(30)
(2c)
(7b)
Purchases of intangible assets, property, plant, equipment, and investment property
– 156.8
– 131.4
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 activities1)
Dividends paid to shareholders of Axel Springer SE
Dividends paid to other shareholders
Purchase of non-controlling interests
Disposal of non-controlling interests
Repayments of liabilities under finance leases
Proceeds from other financial liabilities
Repayments of other financial liabilities
Other financial transactions
Cash flow from financing activities1)
Cash flow-related changes in cash and cash equivalents
Changes in cash and cash equivalents due to exchange rates
Change in cash and cash equivalents due to changes in companies included in consolidation
Cash and cash equivalents at beginning of period
Reclassification relating to assets held for sale
Cash and cash equivalents at end of period
1) For the portion attributable to discontinued operations see note (2d).
€ millions
Cash flows contained in the cash flow from operating activities
Income taxes paid
Income taxes received
Interest paid
Interest received
Dividends received
(2c)
– 365.3
– 637.8
(30)
(30)
(30)
– 30.5
– 94.3
– 194.2
– 8.9
– 30.9
2.4
– 0.7
271.4
– 70.7
– 546.4
– 178.1
– 7.6
– 32.6
0.2
– 0.6
667.6
– 264.7
– 465.2
– 74.3
– 299.9
67.5
51.1
– 35.4
– 125.8
1.0
0.0
253.8
4.7
224.1
1.1
0.1
383.1
– 4.7
253.8
2016
2015
– 170.3
– 174.9
37.1
– 16.6
16.6
15.2
40.1
– 24.2
3.5
13.5
95
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Consolidated Statement of Changes in Equity
Consolidated Statement of Changes in Equity
Accumulated other comprehensive income
Changes in fair value
Sub-
scribed
capital
Ad-
ditional
paid-in
capital
Accumu-
lated
retained
earnings
Treasury
shares
Currency
translation
Available-
for-sale
financial
assets
Deriva-
tives in
cash flow
hedges
Share-
holders of
Axel
Springer
SE
Non-
controlling
interests
Other
equity
Equity
98.9
45.3
2,041.2
0.0
– 28.5
0.3
– 0.4
– 132.9
2,024.1
481.6
2,505.7
252.4
252.4
– 178.1
– 130.9
46.1
46.1
12.1
12.1
0.1
0.1
21.9
21.9
252.4
80.3
332.6
55.0
14.0
69.1
307.4
94.3
401.7
– 178.1
– 63.5
– 241.6
– 130.9
70.3
– 60.6
9.0
453.9
– 461.5
13.9
0.6
– 14.8
15.2
– 0.4
– 109.5
– 94.3
0.9
0.5
13.8
107.9
499.8
1,508.4
0.0
31.5
12.4
– 0.3
– 97.1
2,062.7
448.8
2,511.5
427.3
427.3
– 194.2
– 5.1
– 23.3
– 5.3
0.2
– 41.4
– 41.4
13.6
13.6
0.1
0.1
– 27.2
– 27.2
427.3
– 54.9
372.4
24.6
– 5.6
19.0
451.9
– 60.5
391.4
– 194.2
– 9.7
– 203.9
4.9
5.1
0.0
22.8
22.8
– 18.4
– 58.5
– 77.0
– 5.1
– 1.1
– 6.2
107.9
500.1
1,707.6
0.0
– 5.0
26.0
– 0.2
– 119.2
2,217.4
421.2
2,638.6
€ millions
Balance as of
01/01/2015
Net income
Other income/loss
Comprehensive income
Dividends paid
Change in consolidated
companies
Purchase and disposal of
non-controlling interests
Other changes
Balance as of
12/31/2015
Net income
Other income/loss
Comprehensive income
Dividends paid
Change in consolidated
companies
Purchase of non-
controlling interests
Other changes
Balance as of
12/31/2016
96
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Consolidated Segment Report
Consolidated Segment Report
Operating segments (31)
Classified Ad
Models
Paid Models
Marketing Models
Services/Holding
Consolidated totals
€ millions
2016
2015
2016
2015
2016
2015
External revenues
879.5
753.1
1,481.6
1,582.2
856.2
878.9
2016
72.9
2015
2016
2015
80.7
3,290.2
3,294.9
Internal revenues
0.6
0.5
5.9
3.0
8.5
11.2
156.0
160.7
Segment revenues
880.1
753.6
1,487.6
1,585.2
864.7
890.1
228.9
241.4
354.6
305.0
214.4
223.2
82.2
88.0
– 55.7
– 57.1
595.5
559.0
40.3 %
40.5 %
14.5 %
14.1 %
9.6 %
10.0 %
18.1 %
17.0 %
0.4
– 1.0
16.9
5.3
1.4
– 0.7
– 0.1
0.1
18.7
3.8
0.1
– 1.0
12.7
1.6
– 5.3
– 7.6
– 0.9
0.6
6.6
– 6.5
– 37.0
– 29.9
– 33.5
– 33.8
– 14.8
– 12.6
– 39.0
– 33.7
– 124.3
– 110.0
317.6
275.1
180.9
189.4
67.4
75.3
– 94.8
– 90.8
471.1
449.0
EBITDA1)
EBITDA margin1)
Thereof income from
investments
Thereof accounted for
using the equity method
Depreciation, amortiza-
tion, impairments, and
write-ups (except from
non-recurring effects and
purchase price
allocations)
EBIT1)
Amortization and
impairments from
purchase price
allocations
Non-recurring effects
54.1
– 18.5
74.0
86.9
40.9
– 58.8
– 54.6
– 22.9
– 20.8
– 26.6
– 9.5
35.6
0.0
65.6
0.0
– 108.3
– 84.9
– 5.1
234.6
98.9
Segment earnings before
interest and taxes
Financial result
Income taxes
Income from continued
operations
Income from
discontinued operations
Net income
312.9
202.0
232.1
255.5
81.6
101.5
– 29.1
– 95.9
597.5
463.0
– 21.4
– 22.2
– 126.1
– 136.2
450.0
304.6
1.9
2.8
451.9
307.4
1) Adjusted for non-recurring effects (see note (32)).
Geographical information (31)
€ millions
Germany
Other countries
Consolidated totals
2016
2015
2016
2015
2016
2015
External revenues (32)
1,725.9
1,721.4
1,564.3
1,573.5
3,290.2
3,294.9
Non-current segment assets (32)
1,388.3
1,378.6
3,323.0
3,059.0
4,711.3
4,437.7
97
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
Notes to the Consolidated Financial
Statements
The consideration transferred in business combinations
is offset against the pro-rated fair value of the acquired
assets and liabilities on the acquisition date. Any remain-
ing positive difference allocated to our interests is capital-
ized as goodwill and recognized in the amount allocated
to our shares, unless we acquire all shares in the com-
pany. Negative differences are immediately recognized
as income. The acquisition date indicates the time at
which the option for gaining control of the acquired busi-
ness or company was obtained. We offset differences
arising from disposals and purchases of non-controlling
interests in equity.
Associated companies in which the Axel Springer Group
can exert significant influence over the financial and
operating policies, as well as joint venture companies
that are managed jointly by Axel Springer and one or
more other parties, are included in the consolidated
financial statements by application of the equity method.
The IFRS separate and consolidated financial statements
of these companies as at the Axel Springer Group’s
reporting date, respectively, serve as the basis for apply-
ing the equity method. Goodwill and assets and liabilities
included in the amortized carrying amount are accounted
for using the accounting principles applied to business
combinations. Losses 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 prof-
its and losses are eliminated on a pro-rated basis. The
carrying amounts of investments are tested for impair-
ment; if impairments exist, they are written down to the
lower recoverable amount.
General information
(1) Basic principles
Axel Springer SE is a European exchange-listed stock
corporation (Societas Europaea) with its registered head
office in Berlin, Germany. The company is registered in
the Commercial Register of the local court Berlin-
Charlottenburg under number HRB 154517 B. The prin-
cipal activities of Axel Springer SE and its subsidiaries
(“Axel Springer Group”, “Axel Springer” or the “Group”)
are described in note (31a).
On February 27, 2017, the Executive Board of Axel
Springer SE authorized the consolidated financial state-
ments for fiscal year 2016 and subsequently presented
them to the Supervisory Board for approval. The consol-
idated financial statements were prepared by application
of Sec. 315a HGB in accordance with the International
Financial Reporting Standards (IFRS) of the International
Accounting Standards Board (IASB) and the interpreta-
tions of the IFRS Interpretations Committee (IFRS IC)
approved by the IASB, in effect and recognized by the
European Union (EU) on the reporting date. The report-
ing currency is the euro (€); unless otherwise indicated,
all figures are stated in euro millions (€ millions). Totals
and percentages have been calculated based on the
euro amounts before rounding and may differ from a
calculation based on the reported million euro amounts.
The consolidated financial statements and consolidated
management report will be published in the Federal
Gazette in Germany.
(2) Consolidation
(a) Consolidation principle
The financial consolidated statements include Axel
Springer SE and its subsidiaries over which Axel Springer
SE either directly or indirectly has control, can influence
variable outflows from the subsidiary, and is exposed to
the variability of these outflows.
98
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(b) Companies included in the consolidated
financial statement
Companies included in the consolidated financial state-
ments broke down as follows:
At the beginning of May, we sold our shares in the previ-
ously fully consolidated Smarthouse Media GmbH, Karls-
ruhe.
12/31/2016 12/31/2015
At the beginning of July we acquired 93.4 % of the
shares in eMarketer Inc., New York, USA and have fully
consolidated the company since then.
At the end of July we acquired 75.96 % of the shares in
the Land & Leisure group, Copenhagen, Denmark. As a
result of this acquisition Land & Leisure A.S., Copenha-
gen, Denmark and five additional foreign subsidiaries
together with a domestic subsidiary have been included
in the consolidated financial statements by way of full
consolidation since the acquisition date.
In the middle of September, we invested our shares in
the previously fully consolidated Poliris SAS, Paris,
France, in AC3 SAS, Guipavas, France, which was
founded together with Gercop. We hold 40% of the
shares in AC3 SAS. Since then, the company has been
included in the consolidated financial statements using
the equity method.
At the beginning of September we sold our shares in the
previously fully consolidated Axel Springer Vertriebsser-
vice GmbH, Hamburg.
At the beginning of December, we deconsolidated our
shares in Thrillist Media Group, Inc., Delaware, USA,
which was previously consolidated using the equity
method, in exchange of shares in Group Nine Media Inc.,
New York, USA.
Fully consolidated companies
Germany
Other countries
Investments accounted for using the
equity method
Germany
Other countries
79
120
5
6
75
105
5
6
Consolidated companies are listed in note (43). Essen-
tially, the following major changes occurred in 2016:
The transfer and herewith the deconsolidation of the
previously fully consolidated Swiss business to the newly
founded Ringier Axel Springer Schweiz AG, Zurich, Swit-
zerland, in which we hold 50% of the shares, took place
at the beginning of January. Since then, the company
has been included in the consolidated financial state-
ments using the equity method.
At the beginning of January, we sold our shares in the
previously fully consolidated Automotive Exchange Pri-
vate Limited, Mumbai, India (CarWale). In addition, at the
end of January, we sold our shares in MDB SAS, Evry
Cedex, France, which had previously been accounted for
using the equity method.
At the end of January, we acquired 100% of the shares
in Good & Co. Labs Inc., San Francisco, USA. The com-
pany has been fully consolidated since then.
In mid-April, we acquired 50.01% of the shares in
Traum-Ferienwohnungen GmbH, Bremen. Since then
the company has been included in our consolidated
financial statements by way of full consolidation.
99
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(c) Acquisitions and divestitures
As part of the expansion of our digital activities in the
English-speaking countries and the expansion of the
innovative paid-content portfolio, we acquired approxi-
mately 93% of the shares in eMarketer Inc., New York,
USA at the beginning of July 2016. eMarketer is a lead-
ing provider of high-quality analyses, studies and digital
market data for companies and institutions. Reciprocal
call and put options were agreed upon for the remaining
approximately 7 % of the shares, for which the purchase
price to be paid will be measured by the future corporate
earnings of eMarketer. Insofar non-controlling interests
are not accounted for in this respect.
The acquisition costs amounted to € 219.0 million and
comprised the purchase price paid in July in the amount
of € 207.0 million, a purchase price adjustment paid in
October in the amount of € 2.0 million as well as a con-
tingent purchase price liability of € 10.0 million recorded
at the acquisition date for the agreed option rights. The
acquisition-related expenses recorded in other operating
expenses of the fiscal year amounted to € 1.6 million.
Based on the preliminary purchase price allocation, the
acquisition costs were allocated to the purchased assets
and liabilities on the acquisition date as follows:
€ millions
Intangible assets
Property, plant, and equipment
Trade receivables
Other assets
Deferred tax assets
Cash and cash equivalents
Trade payables
Provisions and other liabilities
Deferred tax liabilities
Net assets
Acquisition cost
Goodwill
Carrying
amount
after
acquisition
137.2
5.1
5.6
22.3
0.4
8.7
– 3.3
– 25.1
– 57.5
93.5
219.0
125.5
Of the intangible assets acquired, intangible assets with
carrying amounts of € 79.0 million have indefinite useful
lives. The non-tax-deductible goodwill is above all at-
tributable to inseparable values such as employee exper-
tise, expected synergy effects from the integration and
the strategic advantages resulting from the leading mar-
ket position of the company, and was allocated to the
Paid Models segment.
The gross amount of the acquired trade account receiv-
ables was € 5.6 million. No valuation allowances were
recorded.
Since initial consolidation as of July 8, 2016, eMarketer
contributed to consolidated revenues in the amount of
€ 13.8 million and to consolidated net income in the
amount of € – 3.5 million. If eMarketer had already been
fully consolidated on January 1, 2016, eMarketer would
have contributed to consolidated revenues in the amount
of € 33.7 million and to consolidated net income in the
amount of € – 3.9 million.
100
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
In order to strengthen our market position in Scandinavia,
we acquired 75.96% of the shares of Land & Leisure
A/S, Copenhagen, Denmark, at the end of July via the
@Leisure Group through a public takeover offer. Land &
Leisure A/S offers vacation homes under the brand
DanCenter and accommodations in holiday parks in
Denmark, Sweden, Norway, and Germany under the
brand Danland
The preliminary acquisition costs amounted to € 47.0
million and included the purchase price paid in the re-
porting period. The acquisition-related expenses record-
ed in other operating expenses of the fiscal year
amounted to € 0.8 million.
Based on the preliminary purchase price allocation, the
preliminary acquisition costs were allocated to the pur-
chased assets and liabilities at the acquisition date as
follows:
€ millions
Intangible assets
Property, plant, and equipment
Non-current financial assets
Trade receivables
Other assets
Deferred tax assets
Cash and cash equivalents
Trade payables
Financial liabilities
Provisions and other liabilities
Deferred tax liabilities
Net assets
Share of non-controlling interests in net assets
Acquisition cost (preliminary)
Goodwill (preliminary)
Carrying
amount
after
acquisition
43.7
4.8
1.1
7.9
1.8
0.1
12.8
– 13.9
– 0.3
– 4.1
– 9.7
44.4
10.2
47.0
12.8
The purchase price allocation considers all knowledge
and adjusting events about conditions that already exist-
ed on the acquisition date, and has not yet been com-
pleted, particularly due to the closeness in time to the
reporting date.
Of the intangible assets acquired, intangible assets with
carrying amounts of € 32.8 million have indefinite useful
lives. The non-tax-deductible goodwill is above all at-
tributable to inseparable values such as employee exper-
tise, expected synergy effects from the integration and
the strategic advantages resulting from the leading mar-
ket position and digital range of the company, and was
allocated to the Classified Ad Models segment.
In September, we increased our share in Land & Leisure
to 93.17 % at a purchase price of € 10.6 million and
acquired the remaining approximately 6.8 % of the share
capital at a purchase price of € 3.5 million as part of a
squeeze-out process in November 2016. Both transac-
tions were treated in the balance sheet as an acquisition
of non-controlling interests (€ 10.2 million). The differ-
ence in the amount of € 3.9 million was offset in accu-
mulated retained earnings attributable to the sharehold-
ers of Axel Springer SE.
The gross amount of the acquired trade account receiv-
ables was € 8.4 million. Corresponding valuation allow-
ances of € 0.5 million were recorded.
Since initial consolidation as of the end of July 2016,
Land & Leisure contributed to consolidated revenues in
the amount of € 15.1 million and to consolidated net
income in the amount of € – 0.6 million. If Land & Leisure
had already been fully consolidated on January 1, 2016,
Land & Leisure would have contributed to consolidated
revenues in the amount of € 41.5 million and to consoli-
dated net income in the amount of € 3.0 million.
In December 2016, we entered into an option agreement
to acquire the remaining 47.5% shares in the zanox
Group and treated it as an acquisition of non-controlling
interests (see note (12g)). The share of the net assets of
the zanox Group, which was attributable to non-
controlling shareholders, amounted to € 44.5 million of
which € 4.9 million resulting from foreign currency trans-
lation effects that needed to be reclassified into the ac-
cording accumulated other comprehensive income posi-
101
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
tion. Due to the option agreement a liability for contin-
gent consideration was recorded in the amount of
€ 63.1 million. The remaining difference of € 23.5 million
was offset within the accumulated retained earnings
attributable to the shareholders of Axel Springer SE
which decreased accordingly. Overall, the equity was
reduced by € 63.1 million.
Further business combinations that occurred in the
reporting period related in particular to the acquisition of
50.01 % of the shares in Traum-Ferienwohnungen
GmbH, Bremen, of 60.4 % of the shares in infoRoad
GmbH, Heroldsberg, as well as 100 % of the shares in
Good & Co Labs, Inc., San Francisco, USA, and
Milkround Online Ltd., London, United Kingdom. These
business combinations were carried out in the context of
our strategy to become the leading digital publisher, and
individually had no material effects on the financial posi-
tion, liquidity, and financial performance of the Axel
Springer Group.
The acquisition costs for the acquisitions – which are
partly preliminary – carried out in the reporting period
amounted to € 41.2 million and contained besides the
purchase prices paid also contingent considerations
amounting to € 2.6 million. The acquisition-related ex-
penses recorded in other operating expenses totaled
€ 0.2 million.
The contingent considerations resulted from earn-out
agreements as well as from option rights for the pur-
chase of the remaining shares, and were recorded at
their fair values on the acquisition date. The fair value
predominantly depends on earnings performance of the
acquired companies in the years prior to possible pay-
ment dates or exercise dates of the options.
The cumulative acquisition costs of the business combi-
nations were allocated to the purchased assets and
liabilities based on the partly preliminary purchase price
allocations as follows:
€ millions
Intangible assets
Property, plant, and equipment and non-current financial
assets
Trade receivables
Other assets
Deferred tax assets
Cash and cash equivalents
Trade payables
Financial liabilities
Provisions and liabilities
Deferred tax liabilities
Net assets
Share of non-controlling interests in net assets
Acquisition cost (preliminary)
Goodwill (preliminary)
Carrying
amount
after
acquisition
39.6
0.3
0.7
1.4
3.3
0.9
– 0.1
– 0.2
– 7.2
– 13.0
25.7
11.2
41.2
26.7
The purchase price allocations consider all knowledge
and adjusting events regarding conditions that already
existed on the acquisition date, and have not yet been
completed for some acquisitions because of the close-
ness in time to the publication of the consolidated finan-
cial statements.
Of the intangible assets acquired in these acquisitions,
intangible assets with carrying amounts of € 23.7 million
have indefinite useful lives. The predominantly non-tax-
deductible goodwill is above all attributable to insepara-
ble values such as employee expertise as well as ex-
pected synergy effects from the integration and was
allocated to the Classified Ad Models (€ 24.6 million) and
Paid Models (€ 2.1 million) segments.
Since their respective initial consolidations, these com-
panies have contributed to the 2016 consolidated reve-
nues in the amount of € 9.3 million and to the 2016
consolidated net income in the amount of € –3.2 million.
If these acquisitions had already been finalized on Janu-
ary 1, 2016, consolidated revenues 2016 would have
102
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
changed by € 12.5 million and consolidated net income
2016 by € –3.0 million.
In January 2017, we acquired via Digital Window Inc., a
company belonging to Axel Springer's zanox Group, 100%
of the shares in ShareASale.com Inc...., Chicago, USA, a
leading affiliate network in the US and have fully consoli-
dated the company since then. The preliminary acquisi-
tion costs amounted to € 43.0 million and include the
purchase price of € 33.0 million, a preliminary purchase
price adjustment of € 0.6 million and a contingent pur-
chase price liability of up to € 9.4 million for agreed earn-
ings targets to be achieved by the end of 2017. The
preliminary acquisition-related expenses amounted to
€ 0.4 million. Due to the closeness in the time to the
publication of the consolidated financial statements to
the acquisition, audited financial information regarding
the acquired net assets is not yet available.
At the beginning of January 2016, we jointly established
with Ringier the company Ringier Axel Springer
Schweiz AG, Zurich, Switzerland, in which we hold 50%
of the shares. The company gathers all Swiss-German
and West Swiss newspaper titles (including their associ-
ated online portals) and the West Swiss broadsheet, Le
Temps, belonging to Ringier and the entire business of
Axel Springer in Switzerland. Since then, the company
has been included in the consolidated financial state-
ments using the equity method, see note (7a).
The carrying amounts contributed at the beginning of
2016 and of the assets and liabilities received in return as
well as the recognition to profit or loss of foreign curren-
cy translation differences previously recognized in other
comprehensive income in equity were as follows:
€ millions
Fair value of investment
Receivable from disposal of trademarks
Other contractual claims and obligations
Additions net assets
Goodwill
Intangible assets
Property, plant, and equipment and non-current financial
assets
Trade receivables
Other assets
Deferred tax assets
Cash and cash equivalents
Provisions and liabilities
Deferred tax liabilities
Disposal net assets
Cumulative translation differences
Result from disposal
Carrying
amount
140.2
40.6
– 16.9
163.9
62.3
88.1
4.1
3.0
6.2
9.0
4.0
– 56.0
– 10.0
110.7
49.0
102.2
The income from disposal recorded in other operating
income amounted to € 102.2 million, was allocated to the
Paid Models segment and adjusted as a non-recurring
effect.
In January 2016, our shares (90.3%) in the previously fully
consolidated Automotive Exchange Private Limited,
Mumbai, India (CarWale), were sold completely at a dis-
posal price totaling € 81.1 million. The purchase price
after deduction of taxes amounted to € 64.0 million. The
profit reported in other operating income totaled € 83.3
million, was allocated to the Classified Ad Models Seg-
ment and adjusted as a non-recurring effect. The carrying
amounts of the assets and liabilities disposed of were as
follows:
103
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
€ millions
Goodwill
Intangible assets
Property, plant, and equipment
Trade receivables
Other assets
Cash and cash equivalents
Trade payables
Financial liabilities
Provisions and liabilities
Deferred tax liabilities
Disposal net assets
Share of non-controlling interests in net assets
Cumulative translation differences
Selling price
Gain on disposal before taxes
Carrying
amount
€ millions
11.0
Goodwill
5.1
0.7
1.2
2.6
0.1
– 0.5
– 15.5
– 4.2
– 1.6
– 1.2
– 1.2
2.2
81.1
83.3
Intangible assets
Property, plant, and equipment
Trade receivables
Other assets
Deferred tax assets
Cash and cash equivalents
Trade payables
Financial liabilities
Provisions and liabilities
Deferred tax liabilities
Disposal net assets
Share of non-controlling interests in net assets
Selling price
Gain on disposal
Carrying
amount
9.9
13.8
1.1
12.5
1.6
0.6
9.6
– 1.5
– 0.2
– 20.1
– 4.4
23.1
0.4
40.2
17.5
Further divestments finalized in the reporting year
related to disposal of 91.0 % of the shares in Smart-
house Media GmbH, Karlsruhe, 100 % of the shares in
Axel Springer Vertriebsservice GmbH, Berlin, as well as
the contribution of 100 % of the shares in Poliris S.A.S.,
Paris, France, into AC3 SAS which was founded togeth-
er with Gercop. These divestments individually had no
material effects on the financial position, liquidity, and
financial performance of the Axel Springer Group. The
cumulative gain on disposal recorded in other operating
income or other operating expenses with respect to
these further divestments amounted to € 17.5 million
and was adjusted as a non-recurring effect. The carrying
amounts of the assets and liabilities disposed of were as
follows:
Additional transactions carried out in the reporting period,
as well as finalizations of purchase price allocations
arising from acquisitions of companies in the prior year,
had no material effects individually and collectively on the
financial position, liquidity, and financial performance of
the Axel Springer Group.
Acquisitions and divestitures in the prior year:
At the beginning of January 2015, we acquired 51 % of
the shares in @Leisure Holding B.V., Amsterdam,
Netherlands and thus of the @Leisure Group. @Leisure is
a leading European operator of online brokerage portals
for vacation home rentals. Through the majority invest-
ment in @Leisure, Axel Springer complements its existing
digital activities in the travel segment.
The acquisition costs paid in 2015 amounted to € 64.8
million and comprised the purchase price amounting to
€ 56.8 million as well as the payment of liabilities as-
sumed in the amount of € 8.0 million. The acquisition-
related expenses recorded in other operating expenses
of the reporting year 2015 amounted to € 0.3 million.
104
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
Based on the purchase price allocation, the acquisition
costs were allocated to the purchased assets and liabili-
ties on the acquisition date as follows:
€ millions
Intangible assets
Property, plant, and equipment
Non-current financial assets
Trade receivables
Other assets
Cash and cash equivalents
Trade payables
Provisions and other liabilities
Deferred tax liabilities
Net assets
Share of non-controlling interests in net assets
Acquisition cost
Goodwill (preliminary)
Carrying
amount after
acquisition
84.4
1.0
0.2
16.1
1.7
2.5
– 18.5
– 3.5
–25.0
59.0
25.2
64.8
31.0
Of the intangible assets acquired, intangible assets with
carrying amounts of € 49.8 million have indefinite useful
lives. The non-tax-deductible goodwill is above all at-
tributable to inseparable values such as employee exper-
tise, the strategic advantages resulting from the leading
market position of the acquired group and expected
synergy effects from the integration, and was allocated
to the Classified Ad Models segment.
The gross amount of the acquired trade account receiv-
ables was € 16.5 million. Corresponding valuation allow-
ances in the amount of € 0.4 million were recorded.
Since first inclusion as of the beginning of January 2015,
@Leisure Group contributed to 2015 consolidated reve-
nues in the amount of € 49.1 million and to 2015 consol-
idated net income in the amount of € 4.0 million.
At the end of June 2015, the combining of the Immo-
welt Group and the Immonet Group belonging to Axel
Springer Digital Classifieds was finalized. Both real estate
portals will be brought under the auspices of the new
Immowelt Holding AG based in Nuremberg. Axel Spring-
er Digital Classifieds has a shareholding of 55 % in the
combined group.
The acquisition costs for the majority shareholding in the
Immowelt Group amounted to € 194.5 million and com-
prised the purchase price paid in 2015 in the amount of
€ 131.0 million, an outstanding purchase price adjust-
ment of € 1.5 million, and the fair value of 45 % of the
shares in the Immonet Group given in exchange totaling
€ 62.0 million. As a result of giving the shares in the
Immonet Group in exchange, and taking into account
their fair value as well as the recognition of non-
controlling interests in the amount of € 16.4 million, a
resulting difference of € 45.6 million was directly offset
against equity, thereof € 6.8 million being attributed to
non-controlling interests. The acquisition-related expens-
es recorded in other operating expenses of the reporting
year 2015 amounted to € 1.1 million.
The non-controlling shareholders were granted fixed-
price put options exercisable at any time until the begin-
ning of 2018 (for 35 % of the shares), as well as one-time
in mid-2019 exercisable put options at performance-
based prices (for 10 % of the shares), which do not
concede any present ownership interest. Thus, the obli-
gation recorded within the balance sheet item other
liabilities representing the discounted redemption amount
with a value of € 194.6 million was directly offset against
equity, thereof € 29.2 million attributed to non-controlling
interests. The changes in equity stemming from the
transaction are shown within the consolidated statement
of changes in equity as part of the line change in consol-
idated companies.
Based on the purchase price allocation, the acquisition
costs were allocated to the purchased assets and liabili-
ties on the acquisition date as follows:
105
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
€ millions
Intangible assets
Property, plant, and equipment
Non-current financial assets
Trade receivables
Other assets
Cash and cash equivalents
Trade payables
Provisions and other liabilities
Deferred tax liabilities
Net assets
Share of non-controlling interests in net assets
Acquisition cost (preliminary)
Goodwill (preliminary)
Carrying
amount after
acquisition
159.2
0.4
0.1
2.0
1.5
9.7
– 0.8
– 5.1
– 50.0
117.1
52.7
194.5
130.1
Of the intangible assets acquired, intangible assets with
carrying amounts of € 51.7 million have indefinite useful
lives. The non-tax-deductible goodwill is above all at-
tributable to inseparable values such as employee exper-
tise, expected synergy effects from the integration and
the strategic advantages due to the combining of two
strongly-positioned companies on the real estate classi-
fieds market, and was allocated to the Classified Ad
Models segment.
The gross amount of the acquired trade account receiv-
ables was € 2.2 million. Corresponding valuation allow-
ances in the amount of € 0.2 million were recorded.
Since initial consolidation as of the end of June 2015,
Immowelt Group contributed to 2015 consolidated reve-
nues in the amount of € 25.0 million and to 2015 consol-
idated net income in the amount of € – 3.0 million. If
Immowelt Group had already been fully consolidated at
January 1, 2015, it would have contributed to 2015
consolidated revenues in the amount of € 48.1 million
and to 2015 consolidated net income in the amount of
€ – 5.4 million.
As part of the expansion of our digital journalistic portfo-
lio in the English-speaking world, we assumed control of
Business Insider Inc., New York, USA, in October
2015. We previously owned 8.7 % of the shares in Busi-
ness Insider and gained control over the company
through the purchase of another 87.8 % of the shares in
October. Axel Springer now holds 96.5 % of the shares.
Business Insider operates the leading digital offering for
business and financial news in the USA.
The preliminary acquisition costs amounted to € 356.0
million and included the purchase price of € 320.4 million
paid in October 2015, fair value of the shares held prior
to gaining control in the amount of € 28.1 million and
liabilities of € 7.4 million from commitments in connec-
tion with an existing employee stock option program.
The acquisition-related expenses recorded in other op-
erating expenses of the reporting year 2015 amounted to
€ 1.6 million. A profit of € 11.1 million from the fair valua-
tion of the previously-held shares was shown in income
from investments.
The preliminary acquisition costs were allocated to the
purchased assets and liabilities based on the preliminary
purchase price allocation as of December 31, 2015 as of
the acquisition date as follows:
€ millions
Intangible assets
Property, plant, and equipment
Trade receivables
Other assets
Cash and cash equivalents
Trade payables
Provisions and other liabilities
Deferred tax liabilities
Net assets
Share of non-controlling interests in net assets
Acquisition cost (preliminary)
Goodwill (preliminary)
Carrying
amount after
acquisition
164.6
1.3
8.6
2.2
27.8
– 0.6
– 5.5
– 65.8
132.6
4.6
356.0
228.0
106
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
The acquisition costs for the acquisitions – which are
partly preliminary – carried out on December 31, 2015,
amounted to € 141.2 million and contained besides the
purchase prices paid also contingent considerations
totaling € 21.4 million as well as the fair value of the
shares held prior to gaining control amounting to € 14.5
million. A profit of € 10.7 million from the fair value
measurement of the previously-held shares was shown
in income from investments. The acquisition-related
expenses recorded in other operating expenses of the
reporting year 2015 amounted to € 0.5 million.
The contingent considerations resulted from earn-out
agreements as well as from option rights to purchase the
remaining shares and were recorded at fair value at the
acquisition date. The fair value predominantly depends
on the estimated results of the acquired companies in
the years prior to possible payment or exercise dates.
Due to the closeness in time to the publication of the
consolidated financial statements 2015, audited financial
information regarding the acquired net assets as well as
the contributions to revenues and operating profit are not
yet available for some of the companies.
Of the intangible assets acquired, intangible assets with
carrying amounts of € 159.1 million have indefinite useful
lives. The non-tax-deductible goodwill is above all at-
tributable to inseparable values such as employee exper-
tise, expected synergy effects from the integration and
the strategic advantages resulting from the leading mar-
ket position of the company and its digital reach, and
was allocated to the Paid Models segment.
The gross amount of the acquired trade account receiv-
ables was € 8.8 million. Corresponding valuation allow-
ances in the amount of € 0.1 million were recorded.
Since first inclusion as of October 30, 2015, Business
Insider contributed to 2015 consolidated revenues in the
amount of € 9.4 million and to 2015 consolidated net
income in the amount of € – 1.1 million. If Business
Insider had already been fully consolidated at January 1,
2015, it would have contributed to 2015 consolidated
revenues in the amount of € 38.5 million and to 2015
consolidated net income in the amount of € – 10.8 mil-
lion.
Further business combinations that occurred in 2015
related to the acquisitions of 100 % of the shares in
ictjob SPRL, Waterloo, Belgium, Interactive Junction
Holding Pty. Ltd., Johannesburg, South Africa, Topic
Travel B.V., The Hague, Netherlands, Nasza Klasa sp. z
o.o., Wroclaw, Poland, Livingly Media, Inc., San Carlos,
USA, profession.hu Kft., Budapest, Hungary, Praxis
SARL, Chambéry, France, Aan Zee "Gezellige
Vakantiehuizen" B.V., Bergen, Netherlands, and Villa XL
B.V., Bergen, Netherlands. Furthermore, we purchased
70 % of the shares in Saknai Net Ltd., Tel Aviv, Israel, a
further 57.9 % of the shares in NARKS INFOSERVIS, a.s.,
Bratislava, Slovakia, as well as a further 32.4 % of the
shares in Sokoweb Technologies, S.L., Barcelona, Spain.
Additionally, we gained control (65 % of the shares) over
Bonial Enterprises GmbH & Co. KG, Berlin. These busi-
ness combinations were carried out in the context of our
strategy to become the leading digital publisher, and
individually had no material effects on the financial posi-
tion, liquidity, and financial performance of the Axel
Springer Group.
107
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
In April 2015, aufeminin Group finalized the sale of 100 %
of its shares in Smart AdServer, Paris, France, at a
disposal price totaling € 37.0 million. The gain on dis-
posal recorded in 2015 in other operating income
amounted to € 10.2 million. The following table shows
the carrying amounts of the assets and liabilities dis-
posed of:
€ millions
Goodwill
Intangible assets
Property, plant, and equipment
Non-current financial assets
Trade receivables
Other assets
Deferred tax assets
Cash and cash equivalents
Trade payables
Provisions and liabilities
Disposal net assets
Selling price
Gain on disposal
Carrying
amount
20.1
1.3
0.4
0.2
5.4
3.4
0.1
3.9
– 3.6
– 4.4
26.8
37.0
10.2
In August 2015, the sale of 50.1 % of our shares in
runtastic GmbH, Pasching, Austria, at a disposal price
totaling € 105.3 million was finalized. The gain on dis-
posal recorded in 2015 in other operating income
amounted to € 85.8 million. The following table shows
the carrying amounts of the assets and liabilities dis-
posed of:
Based on the purchase price allocations, which were
partly preliminary, the cumulative acquisition costs of the
business combinations finalized in 2015 were allocated
to the purchased assets and liabilities as of December
31, 2015:
€ millions
Intangible assets
Property, plant, and equipment
Trade receivables
Other assets
Deferred tax assets
Cash and cash equivalents
Trade payables
Financial liabilities
Provisions and other liabilities
Deferred tax liabilities
Net assets
Acquisition cost (preliminary)
Goodwill (preliminary)
Carrying
amount after
acquisition
63.8
1.1
13.1
1.1
0.5
13.0
– 10.0
– 0.2
– 12.2
– 16.2
54.0
141.2
87.2
Of the intangible assets acquired, intangible assets with
carrying amounts of € 22.6 million have indefinite useful
lives. The non-tax-deductible goodwills are above all
attributable to inseparable values such as employee
expertise and expected synergy effects from the integra-
tion, and were allocated to the Marketing Models (€ 43.0
million), Classified Ad Models (€ 34.9 million) and Paid
Models (€ 9.3 million) segments.
Since their respective initial consolidations, these com-
panies contributed to consolidated revenues 2015 in the
amount of € 41.9 million and to consolidated net income
2015 in the amount of € – 5.1 million. If these acquisi-
tions had already been finalized at January 1, 2015,
consolidated revenues 2015 would have changed by
€ 59.1 million and consolidated net income 2015 by
€ – 11.0 million.
108
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
€ millions
Goodwill
Intangible assets
Property, plant, and equipment
Trade receivables
Other assets
Cash and cash equivalents
Trade payables
Provisions and liabilities
Deferred tax liabilities
Disposal net assets
Share of non-controlling interests in net assets
Selling price
Gain on disposal
Carrying
amount
13.4
13.1
0.8
2.0
0.7
3.4
– 0.9
– 3.7
– 3.3
25.5
6.1
105.3
85.8
Further divestments finalized in the reporting year 2015
related to the disposal of 55 % of the shares in ims Inter-
nationaler Medien Service GmbH & Co. KG, Hamburg,
50.1 % of the shares in Talpa Germany GmbH & Co. KG,
Hamburg, 90 % of the shares in Shop Now GmbH,
Berlin, as well as 100 % of the shares in "Axel Springer
Russia" Geschlossene Aktiengesellschaft, Moscow,
Russia. These divestments individually had no material
effects on the financial position, liquidity, and financial
performance of the Axel Springer Group.
The cumulative gain on disposal recorded in 2015 in
other operating income or in other operating expenses
with respect to these further divestments amounted to
€ 12.4 million. The following table shows the carrying
amounts of the assets and liabilities disposed of:
€ millions
Goodwill
Intangible assets
Property, plant, and equipment
Non-current financial assets
Trade receivables
Other assets
Deferred tax assets
Cash and cash equivalents
Trade payables
Provisions and liabilities
Deferred tax liabilities
Disposal net assets
Share of non-controlling interests in net assets
Cumulative translation differences
Selling price
Gain on disposal
Carrying
amount
11.1
3.4
0.6
0.1
24.6
12.7
1.1
1.1
– 12.1
– 17.9
– 3.1
21.6
4.9
– 1.1
30.2
12.4
In December 2015, Axel Springer increased its share in
Axel Springer Digital Classifieds GmbH from 85 % to
100 %. 8,955,311 new Axel Springer shares were issued
as consideration for the acquisition of the minority share-
holding that was previously held by General Atlantic. The
value of the shareholding taken over totaled
€ 462.9 million; subscribed capital was increased by
€ 9.0 million, the resulting premium in the amount of
€ 453.9 million was assigned to additional paid-in capital.
The proportion of net assets attributable to non-
controlling interests of Axel Springer Digital Classifieds
was reduced by € 109.7 million. The accumulated re-
tained earnings attributable to shareholders of Axel
Springer SE fell by € 367.0 million, and the other accu-
mulated comprehensive income increased by
€ 13.9 million.
Additional transactions carried out in 2015, as well as
finalizations of purchase price allocations arising from
company acquisitions in the reporting year 2014, had no
material effects individually or collectively on the financial
position, liquidity, and financial performance of the Axel
Springer Group.
109
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(d) Discontinued Operations
In 2014, we sold our German regional newspapers, TV
program guides and women's magazines. In the reporting
year, the resulting subsequent income and expenses were
shown separately as discontinued operations in the same
way as in the previous year.
For a part of the purchase price, the FUNKE Medien-
gruppe was granted a multi-year subordinated vendor
loan from the Axel Springer SE. The loan was prematurely
and fully repaid in April 2016 (see note (7b)).
In order to fulfill a proviso imposed in connection with
merger control law, FUNKE Mediengruppe sold some of
the TV program guides acquired under the transaction, as
well as some of its own TV program guides, to the Klambt
Mediengruppe. To assist in the financing of this acquisition,
Axel Springer SE guaranteed a bank loan taken out by the
Klambt Mediengruppe, up to an amount of € 51.0 million.
The bank loan was prematurely and fully repaid in Decem-
ber 2016.
The results of the discontinued operations are as follows:
Mio. €
2016
2015
(e) 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. Good-
will and fair value adjustments of assets and liabilities
related to the acquisition of companies outside the Euro-
pean Monetary Union are assigned to the acquired com-
pany 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 exchange rate
for the year. Equity components have been translated at
the historical exchange rate at the date of origination.
Foreign exchange differences resulting from the transla-
tion 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 the Axel Springer Group underwent the
following changes in the past year:
1 € in foreign
currency
Average price
Exchange rate on
balance sheet date
Gain on disposal of discontinued
operations (before taxes)
Taxes on the gain on disposal
Gain on disposal of discontinued
operations (after taxes)
Income from discontinued operations
(after taxes)
2.8
– 0.9
1.9
1.9
4.1
– 1.3
2.8
2.8
Polish zloty
Swiss franc
US-Dollar
Hungarian
forint
2016
2015 12/31/2016 12/31/2015
4.36
1.09
1.11
4.18
1.07
1.11
4.42
1.08
1.06
4.27
1.08
1.09
311.44
309.90
309.82
315.46
British pound
0.82
0.72
0.86
0.73
As in the previous year, the cash inflows and cash out-
flows attributed to the discontinued operations were only
included in the cash flow from investing activities and
amounted to € – 3.2 million (PY: € – 8.1 million).
(3) Explanation of significant accounting and
valuation methods
(a) Basic Principals
The accounting and valuation principles applied uniformly
across the Axel Springer Group in fiscal year 2016 are
basically the same as those applied in the previous year.
For information on the accounting and valuation methods
resulting from new or revised IFRS Standards and IFRS
IC Interpretations, please refer to note (3q).
110
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(b) Recognition of income and expenses
The Axel Springer Group mainly generates advertising
and circulation 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 transac-
tions are recognized on a straight-line basis over the
contractual term.
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 transac-
tions cannot be measured reliably, the fair value is de-
termined 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.
(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 feasibil-
ity has been demonstrated until the time when the intan-
gible asset has been completed. The capitalized produc-
tion 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 directly serves the generation of revenues. Pur-
chased intangible assets are measured at cost.
Advertising revenues include sales from the online Clas-
sified Ad Models, Reach Based Marketing and Perfor-
mance marketing, as well as from advertising marketing
for our digital media and print media.
Circulation revenues encompass the sales of print media
to retailers, wholesalers, and subscribers. Revenue is not
recognized for that portion of products sold, which can
be expected, on the basis of historical experience, to be
returned. In addition, circulation revenues include the
sale of digital subscriptions.
Where significant risks and rewards of business activities
do not lie with the Axel Springer Group or the income is
collected in the interest of third parties, only the corre-
sponding commission income or proportion of revenue
accruing to the Axel Springer Group are recognized as
revenues.
Offers that contain multiple service components ("bun-
dled products") 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 de-
termined objectively. The total remuneration for these
offers is distributed in principle among the individual
service components in such a way that the service com-
ponents still to be provided are allocated remuneration in
the amount of their fair value, and then the service com-
ponents already provided are allocated the remaining
remuneration in proportion to their fair values.
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Consolidated Financial Statements
Notes to the Consolidated Financial Statements
For depreciation purposes, the following useful lives are
generally applied for property, plant, and equipment:
Buildings
Leasehold improvements
Printing machines
Editing systems
Other operational and business equipment
Useful life in
years
30 – 50
2 – 15
5 – 20
3 – 7
2 – 15
Capital investment subsidies and bonuses granted by
the government are recognized when it is reasonably
certain that the subsidies will be granted and the related
terms and conditions will be fulfilled. Bonuses and subsi-
dies granted for the acquisition or construction of prop-
erty, plant and equipment are recognized in a deferred
income item within other liabilities. In subsequent 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 depreciat-
ed over a useful life of 50 years using the straight-line
method. For leased assets whose economic benefits are
attributable to Axel Springer, see note (3d).
Internally generated and purchased intangible assets that
have a determinable useful life are amortized over their
expected useful lives using the straight-line method,
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 – 17
Intangible assets with an indefinite useful life, which in-
clude 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 re-
strictions.
(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 attributable
to Axel Springer are recognized 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 residual value into consideration.
When it is reasonably certain 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 payment obligations associated with the minimum
future lease payments is recognized as a liability.
112
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Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(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 prop-
erty when as a result of certain events or changed cir-
cumstances, the carrying amount of the assets is no
longer covered by the recoverable amount, i.e. the higher
of the fair value less cost of disposal (“net realizable
value”), and the value in use. If it is not possible to de-
termine the recoverable amount of an individual asset,
the determination of the recoverable amount is carried
out at the cash generating unit level, or in the group of
cash generating units (each one a “reporting unit”) to
which the asset belongs.
Goodwill and intangibles with indefinite useful lives which
are acquired in the context of business combinations,
are not subject to amortization, and shall be tested at
least once annually for impairment. In order to carry out
the impairment tests, these assets are assigned to those
reporting units that can be expected to profit from the
synergies of the business combinations. These reporting
units represent the lowest level at which these assets are
monitored for management purposes. They generally
correspond to individual titles and digital products of the
Axel Springer Group. In the case of integrated business
models, individual titles and digital products are summed
up in a single reporting unit.
If the carrying amount exceeds the recoverable amount,
this results in an impairment loss. For reporting units, the
goodwill is initially reduced, and an additional impairment
loss is allocated pro rata to the carrying amounts of the
other assets of the reporting unit.
As a basic principle, the recoverable amount is initially
determined based on the value in use. The net realizable
value is additionally determined when the value in use is
less than the carrying amount. The net realizable value
corresponds to the amount reduced by the selling costs,
which can be achieved on commercial terms through the
sale of an asset or reporting unit. As quoted prices are
not observable, as a general rule, the net realizable value
is determined as the present value of future cash flows,
which are derived from the medium-term planning and
from the point of view of an independent third party.
Thus, the valuation is based on unobservable input fac-
tors (Level 3, see note (3g)).
The determination of the value in use is taking into con-
sideration the further use within the Group and is based
on the estimated future cash flows, which are derived
from the medium-term planning. Expenses of the
group’s central operations are also taken into account.
Basically, the planning horizon for the medium-term
planning is five years. However, the values in use are
primarily determined 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 medi-
um-term planning, and on the discount rate. The cash
flows to be received after the five-year period are extrap-
olated on the assumption of a growth rate, which is
derived from the assumed average market or industry
growth rate of the reporting unit.
The discount rates for every business unit are deter-
mined with reference to the weighted average costs of
capital and costs of debt of comparable companies. In
this respect, country-specific risk premiums and tax
rates are taken into account.
Estimation uncertainties arise in the following assump-
tions applied in the calculations:
(cid:1) 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.
(cid:1) Discount rates: Based on the average weighted capi-
tal costs of the sector in question, the discount rates
of the reporting units also consider country-specific
risks, which reflect the current market estimates.
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Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(cid:1) 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 with regard to the determination of the
value in use, due consideration was given to the
compensatory 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 an asset or a
reporting unit, due to changes in the estimates upon
which the measurement is based. The reversal is limited
to the amount that would have resulted if previous im-
pairment 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, trade receivables, receivables from related
parties, loans, investments, securities, and financial de-
rivatives with positive market values. Financial liabilities
are mainly composed of trade payables, liabilities due to
related parties, liabilities due to banks, promissory notes,
contingent consideration, and financial derivatives with
negative market values.
The initial recognition and derecognition of financial in-
struments coincide with the settlement dates of custom-
ary market purchases and sales of financial assets.
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 transferred. A
financial liability is derecognized when the obligation
underlying the liability is settled or annulled, or has ex-
pired.
For financial assets and financial liabilities which need to
be measured at fair value, we apply the following valua-
tion hierarchy. Hereby, the input factors used in the
valuation models are categorized into three levels:
(cid:1) Level 1: Quoted (unadjusted) prices in active markets
for identical assets or liabilities (e.g., stock market
prices).
(cid:1) Level 2: Input factors other than prices quoted in
Level 1, which are observable for the asset or the lia-
bility, either directly or indirectly (e.g., interest yield
curves, forward rates).
(cid:1) Level 3: Input factors which are not observable on a
market for the asset or the liability (e.g. estimated fu-
ture results)
When determining the fair value, the application of rele-
vant and observable input factors is given high priority,
whereas the application of non-observable input factors
is given less priority. The classification of the valuation
models into the respective valuation hierarchy levels is
monitored at the end of each reporting period.
Investments and securities
Investments that have not been consolidated or ac-
counted for using the equity method in the consolidated
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 invest-
ment income. We assume that the fair value of invest-
ments and securities is not reliably measurable when
either material valuation differences appear in estimating
fair values based on projections and scenarios, or when
the likelihood of such projections and scenarios cannot
be reliably determined. Any unrealized 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 profit or loss
114
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Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
recognized in accumulated other comprehensive income
are recycled when the underlying transaction is recog-
nized on the balance sheet or income statement. The
changes in the fair value of derivatives that do not meet
the conditions for the application of hedge accounting,
despite their economic hedging effect, are measured at
fair value through profit and loss. Furthermore, financial
derivatives are used to cover the risk of impairments of
investments and securities. When the underlying financial
assets are recognized at amortized costs because their
fair values are not reliably measurable, the financial deriv-
ative is recognized at amortized costs as well.
Contingent consideration
Contingent consideration arising from options written
over non-controlling interests and earn-out agreements
in connection with business combinations and the acqui-
sition of non-controlling interests are recognized at fair
value. To the extent it can be reliably measured, this
value is derived from the estimated profit trends of the
acquired companies in the years prior to the possible
exercise dates of the options or the payment dates of
the earn-outs. In the subsequent periods, changes in the
fair value are recognized immediately in income. The
discount rates are determined on the basis of the
Group’s cost of debt. The earnings used as a basis for
measurement are generally EBITDA figures adjusted for
material non-recurring effects.
Other financial liabilities
Upon initial recognition, other non-derivative financial
liabilities are measured at fair value less transaction costs.
In subsequent periods, they are principally measured at
amortized cost using the effective interest method. Liabil-
ities arising from put options written over non-controlling
interests, which are not recognized as contingent con-
sideration, are measured at the present value of the
redemption amount through profit or loss.
until the corresponding non-current financial assets are
sold or an impairment loss is recognized.
The carrying amounts of investments and securities are
reviewed on every reporting date to determine whether
there are objective indications of an impairment. This is
ensured, for example, if the issuer has considerable
financial difficulties. If an impairment is found to exist, an
impairment loss is recognized in profit or loss.
Loans, receivables, and other financial assets
Upon initial recognition, loans, receivables, and other
financial assets are measured at fair value plus transac-
tion costs. In subsequent periods, they are measured 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 receiv-
able may not be fully collectible. Such an indication might
be the insolvency or other considerable financial prob-
lems of the debtor, for example. The amount of the
write-down is measured as the difference 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 receiv-
ables 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.
Financial derivatives
Financial derivatives are utilized to hedge against curren-
cy and interest rate risks that have an influence on future
cash flows. These are stated at their current market
value. The valuation is based on observable parameters,
using recognized valuation methods, and is particularly
influenced by the development of forward rates or yield
curves. If the conditions for the application of hedge
accounting are met, changes in the fair values, including
the tax effects, are recognized directly in equity as ac-
cumulated other comprehensive income. The amounts
115
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(j) Pension provisions
Pension obligations under defined benefit plans are
determined using the projected unit credit method under
which future changes in compensation and benefits are
taken into account. In order to calculate the pension
provisions, the present value of the obligations is netted
against the fair value of the plan assets.
The expected life spans of the participants are deter-
mined with reference to the country-specific recognized
actuarial tables. The present value of the defined benefit
commitments is determined by discounting the estimat-
ed future cash outflows. The discount rate applied for
this purpose is determined with reference to high-quality
AA-rated corporate bonds that match the underlying
pension obligations with respect to currency and maturi-
ty. If corporate bonds with matching terms do not exist,
then the yields of these bonds at the balance sheet date
are adjusted along the yield curve for fixed-interest gov-
ernment bonds using a constant spread over the term of
the underlying pension obligations.
The return underlying the measurement of the plan as-
sets is identical to the discount rate for defined benefit
commitments.
Actuarial gains and losses resulting from changes in
actuarial parameters are offset against accumulated
other comprehensive income without affecting net in-
come.
(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 overhead
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 fin-
ished goods and services less remaining costs of com-
pletion. Impairments are reversed whenever the reasons
justifying an earlier write-down no longer exist.
(i) Assets held for sale and discontinued operations
Assets are classified as held for sale when their disposal
has been initiated, the sale of such is highly probable and
the asset or disposal group is available for immediate
sale in its present condition. 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. Liabilities that are held
in connection with assets held for sale are disclosed
likewise separately in the balance sheet as a current item.
Discontinued operations represent a material geograph-
ical or operational line of business of the Group that is
available for sale.
The results from continued operations in the fiscal year
and the prior year are shown in the income statement.
The results from discontinued operations are shown
separately. Cash inflows and cash outflows from discon-
tinued operations are shown separately in the notes to
the consolidated financial statements. The information in
the notes relates to the continued operations of the
Group.
116
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Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(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 corresponds to
the expected settlement amount. In the case of long-
term provisions, the expected settlement amount is
discounted to the present value at the reporting date by
application of appropriate market rates of interest. Provi-
sions are recognized for restructuring expenses only
when the intended measures have been sufficiently con-
cretized 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 financial
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 prob-
able that the differences will reverse or the tax loss carry-
forwards can be utilized. Deferred tax assets are recog-
nized 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 de-
ferred taxes are based on the income taxes imposed by
the same tax authority and only when current taxes can
be netted as well.
(m) Treasury shares
Treasury shares are measured at cost and are charged
directly to 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 compensa-
tion components to be recognized as expenses over the
vesting period are measured as the fair value of the
options granted 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 recognized
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 liabilities or provi-
sions are recognized in personnel expenses; reversals
are accounted for in other operating income
(o) Transactions in foreign currencies
Purchases and sales in foreign currencies are translated
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) Estimates and assumptions
The preparation of financial statements requires esti-
mates and assumptions, as well as the exercise of dis-
cretionary powers, which can have an impact on the
amount and disclosure of assets and liabilities, income
and expenses and contingent liabilities. Estimates and
assumptions are regularly reviewed and adjusted if nec-
essary. Nevertheless, they may differ from the actual
values. Estimates and assumptions which are affected
by uncertainty are associated in particular with impair-
ment testing of goodwill and intangible assets with indef-
inite useful lives (cf. clause (3f)), for allocating purchase
prices (cf. clause 2c)) and assessing contingent purchase
price liabilities (cf. clause (3g)), setting actuarial parame-
ters in the context of the valuation of pension obligations
(cf. clause (3j)), determining the amount of deferred tax
117
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Consolidated Financial Statements
Notes to the Consolidated Financial Statements
assets to be capitalized (cf. clause (3l)), determining fair
values of financial assets (cf. clause (3g)), accounting for
other provisions (cf. clause (3k)), assessing share-based
compensation programs (cf. clause (3n)), and the deter-
mination of the useful lives of intangible assets (cf. clause
(3c)) and property, plant and equipment (cf. clause (3d)).
Information concerning the carrying amounts, which are
based on estimates and assumptions, can be found in
the comments on the specific line items.
(q) New accounting standards
In the fiscal year 2016, IFRS Standards or IFRIC Interpre-
tations to be applied for the first time caused no material
changes for Axel Springer.
The following IFRSs have already been published, but
have not yet been applied:
With the publication of the final version of IFRS 9 “Finan-
cial Instruments” in July 2014, the IASB completed its
project for replacing IAS 39 “Financial Instruments:
Recognition and Measurement”. IFRS 9 provides a
standardized approach for classification and measure-
ment of financial assets and liabilities which is primarily
based on the company's business model and the cash
flows of the financial instrument. Furthermore, IFRS 9
contains a new impairment model which also demands
the recording of expected losses in addition to incurred
losses. Finally, IFRS 9 also contains new guidelines for
the use of hedge accounting, targeted in particular at
better illustration of the risk management activities of a
company and the monitoring of non-financial risks.
IFRS 9 is to be applied to fiscal years starting on or after
January 1, 2018. Early application is permitted. We plan
to apply the standard as of January 1, 2018 for the first
time. Our preliminary analysis has shown that the classi-
fication and measurement of financial assets as well as
the accounting for financial liabilities will change only
insignificantly. Particularly due to the new impairment
model, in the case of non-current financial assets an
earlier recognition of possible losses can arise. As a
result of the new standard, accounting for transactions
involving hedging will principally increase. Nonetheless,
due to the small extent of relevant hedging instruments,
we do not expect any significant adjustments. A deeper
analysis, which takes into account in particular the quan-
titative effects, will take place in fiscal year 2017. Overall,
we do not expect any major changes in the presentation
and recognition of financial assets and liabilities through
the application of IFRS 9.
In May 2014, the IASB published the new standard for
revenue recognition, IFRS 15 “Revenue from Contracts
with Customers”, which will completely replace the exist-
ing regulations for the recognition of revenue, including
related interpretations, in accordance with IAS 18 “Reve-
nue” and IAS 11 “Construction Contracts”. Consequently,
revenues will be recognized in the future, when the cus-
tomer obtains control over the agreed goods and ser-
vices and can derive benefits from these. Revenues are
recognized in the amount of the consideration that the
company will presumably receive. The new standard
provides a five step process, in which the volume of
sales and the time or the period of implementation can
be determined. The model is as follows: Identification of
the customer contract, identification of the individual
performance obligations, determination of the transaction
price, allocation of the transaction price to the separate
contractual obligations, and the realization of revenue
when individual contractual obligations are fulfilled. Fur-
thermore, the new standard requires future qualitative
and quantitative disclosures which go far beyond the
current regulations. IFRS 15 is to be applied to fiscal
years starting on or after January 1, 2018. Early applica-
tion is permitted; however, we do not intend to apply the
standard early. In the reporting year, we have continued
to analyze the extent to which the application of the new
standard might affect our revenue recognition account-
ing. Bundle offers may in some cases lead to an earlier
recognition of revenues, since instead of using the resid-
ual value method (see note (3b)) a price reduction includ-
ed in the bundle offer shall also be allocated to the
goods and services still to be rendered in proportion to
their fair values. Furthermore, in the case of longer-
termed contracts, expenses to obtain those contracts
may be capitalized, thereby shifting the recording of
expenses to subsequent periods. At this point in time,
the effects of the new standards on our financial report-
ing cannot be quantified in a conclusive and complete
manner. Nonetheless, we assume that the application of
118
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
the new standard as a whole will not have any significant
effects on revenue recognition at company level as well
as at segment level.
In January 2016, IASB published IFRS 16, “Leasing”.
IFRS 16 replaces IAS 17 “Leasing relationships” and the
associated interpretations. According to the new regula-
tion, lessees are required to account for all leases in the
form of a right of use, and a corresponding leasing liabil-
ity. A leasing relationship exists if the fulfillment of the
contract depends on the use of an identifiable asset, and
the customer simultaneously acquires control of this
asset. The presentation in the profit and loss account is
essentially a financing transaction, so that the right of use
usually depreciates in a linear manner, and the leasing
liability is updated in accordance with the effective inter-
est method. Leases with a total term of a maximum of
twelve months, and leases of so-called low-value assets
(purchase price of up to USD 5,000) are excluded from
this principle. In such cases, the lessee has the option of
selecting an accounting method which is similar to that
of the previous operating lease. IFRS 16 is to be applied
to fiscal years starting on or after January 1, 2019. Early
application is permitted, as long as IFRS 15 has already
been applied. We plan an early application as of Janu-
ary 1, 2018. The adoption of IFRS 16 into European law
is still pending. The ongoing review of the impact of the
new standard on our accounting has already shown that
the new rules affect in particular the accounting and
measurement of rental and leasing items, which are
currently classified as operating leases. These mainly
comprise leased office spaces, leased vehicles and other
leased operational and business equipment, which will
lead to the recognition of respective rights of use and
corresponding leasing liabilities in the future, although we
will apply the maturity-specific and valuation-specific
simplification rules mentioned above. The future mini-
mum lease payments from operating leases are dis-
closed in note (40), but at the present time, we cannot
provide any conclusive and complete information on the
effects of the new rules on our financial reporting.
Furthermore, IASB and IFRS IC have published addition-
al pronouncements that have had, or will have, no mate-
rial influence on our consolidated financial statements.
119
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Consolidated Financial Statements
Notes to the Consolidated Financial Statements
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, 2015
Initial consolidation
Deconsolidation
Currency effects
Additions
Disposals
Transfers
Balance as of December 31, 2015
Initial consolidation
Deconsolidation
Currency effects
Additions
Disposals
Transfers
Balance as of December 31, 2016
Depreciation, amortization, and impairments
Balance as of January 1, 2015
Deconsolidation
Currency effects
Additions
Disposals
Transfers
Balance as of December 31, 2015
Deconsolidation
Currency effects
Additions
Disposals
Transfers
Balance as of December 31, 2016
Carrying amounts
Balance as of December 31, 2016
Balance as of December 31, 2015
Purchased
rights and
licenses
Internally
generated
rights
Goodwill
Total
1,674.7
446.0
– 19.9
36.6
44.9
– 10.4
– 159.8
2,012.1
210.6
– 23.7
– 12.4
35.2
– 9.8
– 20.9
2,191.1
435.0
– 4.2
7.9
104.8
– 9.4
– 64.8
469.2
– 12.1
– 5.9
127.7
– 9.5
– 4.1
565.3
159.9
27.0
– 13.0
3.2
39.4
– 0.7
– 7.1
208.7
9.9
– 4.5
– 8.7
64.9
– 2.3
20.9
1,927.4
476.9
– 67.2
37.5
0.0
– 0.3
– 96.4
2,277.9
168.8
– 8.9
– 13.2
0.0
0.0
0.0
3,762.0
949.9
– 100.1
77.3
84.3
– 11.4
– 263.3
4,498.7
389.2
– 37.2
– 34.3
100.1
– 12.0
0.0
288.9
2,424.6
4,904.5
84.8
– 11.1
1.7
36.9
– 0.7
– 8.3
103.4
– 1.9
– 5.3
48.7
– 2.1
4.1
73.2
– 22.4
1.7
0.0
0.0
– 23.3
29.1
0.0
1.0
0.0
0.0
0.0
146.8
30.1
593.0
– 37.8
11.3
141.6
– 10.0
– 96.4
601.7
– 14.0
– 10.2
176.4
– 11.6
0.0
742.2
1,625.8
1,542.9
142.0
105.4
2,394.4
2,248.8
4,162.3
3,897.0
120
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
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.
The reclassifications in the prior year consisted almost
exclusively of the classification as assets held for sale
(see note (11)).
In the following tables, we disclose the allocation of goodwills and the purchased rights and licenses within the intangi-
ble assets with indefinite useful lives for reporting units, as well as the discount rates and growth rates used for impair-
ment testing:
Total
595.2
402.9
398.6
377.0
221.6
214.6
198.1
194.8
148.9
Discount rate
(before tax)
Discount rate (after
tax)
Growth
rate
10.0 %
9.4 %
8.2 %
9.5 %
11.4 %
10.1 %
8.6 %
10.1 %
10.6 %
7.6 %
7.3 %
7.2 %
7.7 %
8.6 %
7.3 %
6.8 %
8.3 %
8.4 %
2.5 %
2.5 %
2.5 %
2.5 %
2.5 %
2.5 %
2.5 %
2.5 %
2.5 %
1.5 % –
2.5 %
765.4
6.4 % – 10.8 %
5.0 % – 8.6 %
3,517.2
1,868.5
1,107.1
540.9
2016
SeLoger
Business Insider
Ringier Axel Springer Media
StepStone
AuFeminin
eMarketer
Immowelt
Yad2
Zanox
Others
Total
Thereof Classifieds Ad
Models
Thereof Paid Models
Thereof Marketing Models
€ millions
Other intangible
assets with
indefinite useful life
Goodwill
463.4
237.1
192.4
235.8
166.2
131.7
142.1
138.2
148.9
538.6
2,394.4
1,278.8
647.9
467.2
131.8
165.8
206.2
141.1
55.5
82.9
56.1
56.6
0.0
226.8
1,122.8
589.8
459.2
73.8
121
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
2015
SeLoger
Ringier Axel Springer Media
StepStone
Business Insider
AuFeminin
Immowelt
Yad2
Zanox
Others
Total
Thereof Classifieds Ad
Models
Thereof Paid Models
Thereof Marketing Models
€ millions
Other intangible
assets with
indefinite useful life
Goodwill
471.5
198.3
242.3
230.4
166.4
142.1
132.0
157.0
509.0
2,249.0
1,258.2
516.9
473.3
131.8
210.8
150.1
161.0
54.7
55.8
54.0
27.2
173.4
1,018.7
543.0
375.6
100.1
Total
603.2
409.1
392.4
391.4
221.1
197.8
186.0
184.2
Discount rate
(before tax)
Discount rate
(after tax)
Growth rate
10.8 %
9.2 %
10.9 %
10.4 %
11.7 %
9.2 %
10.6 %
11.1 %
8.0 %
7.9 %
8.8 %
8.0 %
8.8 %
7.3 %
8.5 %
9.0 %
2.5 %
2.5 %
2.5 %
2.5 %
2.5 %
2.5 %
2.5 %
2.5 %
682.4
7.6 % – 11.1 %
5.8 % – 8.3 %
1.5 % – 2.5 %
3,267.7
1,801.2
892.5
573.4
The changes in goodwills of the major reporting units were as follows:
€ millions
12/31/2014
Initial
conso-
lidation
Deconsoli-
dation
Currency
effects
12/31/2015
Initial
conso-
lidation
Deconsoli-
dation
Currency
effects
12/31/2016
471.5
0.0
– 8.0
230.4
242.3
198.3
166.4
157.0
142.1
132.0
0.0
1,740.0
0.0
12.1
0.0
0.0
0.0
0.0
0.0
125.5
137.5
0.0
6.7
– 18.6
– 5.8
– 0.2
– 8.1
0.0
6.2
6.3
463.4
237.1
235.8
192.4
166.2
148.9
142.1
138.2
131.7
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
– 8.0
– 13.6
1,855.8
SeLoger
Business
Insider
465.6
5.9
0.0
227.8
StepStone
226.6
8.1
Ringier Axel
Springer
Media
AuFeminin
Zanox
187.2
162.7
153.4
10.3
22.8
0.0
Immowelt
11.9
130.1
Yad2
eMarketer
107.5
0.0
11.2
0.0
0.0
0.0
0.0
– 0.5
– 20.1
0.0
0.0
0.0
0.0
Total
1,314.9
416.2
– 20.6
0.0
2.6
7.6
1.3
1.0
3.6
0.0
13.3
0.0
29.4
122
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
In addition to the discount rates and growth rates stated
above, the impairment tests depend upon the medium-
term planning of the reporting units.
The medium-term planning of SeLoger is based on the
assumption of a moderate growth of the online real es-
tate advertising market in France, strengthening brand
awareness and differentiation characteristics in a com-
petitive market environment, focusing marketing activities
on the goal of improving market penetration particularly
in regions outside Paris, a rise in the average revenue per
customer, and accelerating growth in vertical niche por-
tals by increasing market share.
The medium-term planning of Business Insider is
based on the assumption that sales will grow significantly.
This growth shall predominantly be triggered by the
further development of the Business Insider brand port-
folio (such as INSIDER, Markets Insider), the fee-based
market research offering ("BI Intelligence") and the ex-
pansion into new international markets. The main reve-
nue streams are those from advertising. In order to rea-
sonably consider in the cash flow projections the period
of developing the company acquired in the reporting
period to stable conditions, we have used a detailed
planning period of nine years, thereby exceeding the
period normally applied. We imply in our planning as-
sumptions that Business Insider is well-positioned with
its competencies in Video and Mobile and in native and
programmatic advertising formats and will benefit from
the growth in the US advertising market.
In the medium-term planning of Ringier Axel Springer
Media, we assume that our digital content offerings will
increasingly and sustainably participate in the structural
shift from print to digital channels and that our digital
business models will gain in importance in the areas of
paid-content models and classified ad models in the
long-term. However, the revenue streams in sales and in
the print advertising market will come under increasing
pressure in the coming years. It will be possible to at
least partly compensate for the declining circulation
figures by price increases. With a strict cost manage-
ment in the print business it shall be possible to largely
maintain profitability.
In the medium-term planning of the StepStone Group,
we assume that the anticipated development of the
economy will still have a positive impact on the labor
market. The assumptions made include increasing reve-
nues in our European and South African core markets as
well as in our Latin American markets. The respective
market positions are to be expanded and strengthened
particularly through the further development of the prod-
uct portfolio and the expansion of the system landscape,
but also by intensified marketing measures (online as well
as offline) to further strengthen the Candidate Delivery.
We expect the returns to remain at a high level.
The focus of the strategy of the aufeminin Group is the
further development of various growth pillars to strength-
en the market position in Europe as well as in the USA.
The user groups of aufeminin's video, mobile and social
media offers are monetized by programmatic advertising,
e-commerce (e.g. subscription boxes) in Europe, native
advertising and brand publishing.
The medium-term planning of eMarketer is based on
the assumption that revenue per corporate customer can
be significantly increased, in particular by a higher user
volume. Additional growth potential lies in the interna-
tionalization as well as in thematic extensions of the
offerings in order to gain further customers from indus-
tries affected by digitization. In the area of advertising
revenues, growth shall be achieved through the expan-
sion of the advertising inventory.
The medium-term planning of the Immowelt Group is
based on the assumption of an ongoing successful
combining of Immowelt’s and Immonet’s customers
within the process of merging these two companies in
the year 2015. For this, a stable status on the German
real estate market and ongoing competition is assumed.
In order to strengthen brand awareness, further invest-
ments in marketing measures are planned for the coming
years.
Yad2's medium-term planning is based on the assump-
tion of a generally stable political environment in Israel
with moderate overall growth rates. Yad2 is profiting
from a high brand awareness and a resulting good mar-
123
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
ket position. It is expected that in particular a growing
real estate market as well as an increase in customers,
particularly in the auto segment, will contribute to rising
revenues. Further growth is expected from the Drushim
job portal, which also benefits from synergies with Yad2.
The medium-term planning of the zanox Group is
based on the assumption that the market position in the
core markets of Germany and Western Europe but also
in the USA will be expanded among other things through
a continuous further development of the offered product
portfolio for the advertisers, inter alia through the already
advanced integration of Zanox and Digital Window plat-
forms, as well as binding measures for the connected
publishers.
The recoverable amount was determined as the value in
use for all reporting units; in the previous year, for the
reporting units Ringier Axel Springer Media and Zanox
the fair value less costs to sell was calculated additionally.
In the course of a sensitivity analysis, we have as-
sumed separately for each of our large reporting units
a 10 % decrease of future cash flows in the last plan-
ning year, a 10 % increase of the weighted average
costs of capital or a decrease of the terminal growth
rate by half a percentage point. On this basis, no re-
porting unit (PY: solely the reporting unit Zanox)
showed that its carrying amount of the assets exceed-
ed its recoverable amount. As of December 31, 2015,
the surplus between the recoverable amount and the
carrying amount of the reporting unit Zanox totaling
€ 22.0 million would have reduced to zero if the material
measurement parameters would have changed as fol-
lows:
Increase of
discount
rate
(before
taxes) to
Increase of
discount
rate (after
taxes) to
Reduction
of growth
rate to
Reduction
of cash
flow in the
fifth year of
medium-
term
planning
by
11.9 %
9.6 %
1.8 %
– 9.9 %
2015
Zanox
Goodwill allocated to the other reporting units of the
Group and intangible assets with indefinite useful lives of
€ 765.4 million (PY: 682.4 million) amounted to less than
5% (PY: 5%) of the total value. In the course of a sensi-
tivity analysis, we have assumed separately for each of
our other reporting units a 10 % decrease of future
cash flows in the last planning year, a 10 % increase of
the weighted average costs of capital or a decrease of
the terminal growth rate. As in the previous year, no
impairment was indicated for any of the other reporting
units.
124
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(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, 2015
Initial consolidation
Deconsolidation
Currency effects
Additions
Disposals
Transfers
Balance as of December 31, 2015
Initial consolidation
Deconsolidation
Currency effects
Additions
Disposals
Transfers
Technical
equipment
and
machinery
Other
equipment,
operational
and office
equipment
Construction
in progress
Land and buildings
435.8
0.2
0.0
0.1
1.9
– 23.6
1.8
416.2
3.9
0.0
– 0.5
1.1
– 0.1
3.2
531.3
0.0
– 1.2
0.1
4.1
– 5.5
6.4
211.6
3.8
– 6.0
1.3
22.6
– 4.1
– 7.0
535.2
222.3
0.0
0.0
2.3
4.2
0.0
1.1
6.3
– 4.6
– 3.2
22.5
– 1.2
1.4
Total
1,191.8
3.9
– 7.2
1.6
52.5
– 33.0
– 13.2
1,196.4
10.3
– 4.6
– 1.4
59.1
– 1.3
3.1
1,261.5
13.1
– 0.1
0.0
0.0
24.0
0.1
– 14.4
22.7
0.0
0.0
0.0
31.2
0.0
– 2.5
51.3
Balance as of December 31, 2016
423.8
542.9
243.5
Depreciation, amortization, and impairments
Balance as of January 1, 2015
144.3
377.4
146.6
– 0.1
668.2
Initial consolidation
Deconsolidation
Currency effects
Additions
Disposals
Transfers
Balance as of December 31, 2015
Deconsolidation
Currency effects
Additions
Transfers
0.0
0.0
– 0.1
8.8
– 13.0
0.2
140.3
0.0
0.2
8.8
0.5
0.0
– 0.4
0.1
21.9
– 5.3
– 0.6
393.1
0.0
2.8
21.6
0.0
0.1
– 4.8
2.1
26.5
– 3.1
– 11.8
155.6
– 3.5
– 2.2
25.0
0.0
Balance as of December 31, 2016
149.8
417.5
174.9
0.0
0.0
0.0
0.0
0.1
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.1
– 5.2
2.1
57.3
– 21.3
– 12.2
689.0
– 3.5
0.7
55.4
0.5
742.1
Carrying amounts
Balance as of December 31, 2016
Balance as of December 31, 2015
274.0
275.9
125.4
142.1
68.6
66.7
51.3
22.7
519.2
507.5
As of December 31, 2016, property, plant and equip-
ment with acquisition or production cost of
€ 298.5 million (PY: € 276.3 million) were in use, that
had already been fully depreciated.
125
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
At the balance sheet date, property, plant, and equip-
ment amounting to € 35.7 million (PY: € 35.3 million) had
been pledged as security for own liabilities.
Due to increased own use of office space in the reporting
year, reclassifications with carrying amounts totaling
€ 2.6 million (PY: € 2.1 million) from investment property
to property, plant and equipment took place.
As of December 31, 2016, the carrying amount of prop-
erty, plant, and equipment as part of finance leases was
€ 0.8 million (PY: € 1.4 million).
The additions in the reporting year with respect to the
construction in progress amounting to € 26.3 million (PY:
€ 10.5 million) relate to the new Axel Springer head-
quarter building (see note (40)).
(6) Investment property
The development of the office and retail spaces in Berlin
leased to third parties was as follows:
€ millions
Acquisition or production cost
Balance as of January 1, 2015
Transfers
Balance as of December 31, 2015
Transfers
Balance as of December 31, 2016
Depreciation, amortization, and impairments
Balance as of January 1, 2015
Additions
Transfers
Write-ups
Balance as of December 31, 2015
Additions
Transfers
Balance as of December 31, 2016
Carrying amounts
As of December 31, 2016
As of December 31, 2015
Investment
property
42.9
– 3.5
39.4
– 3.1
36.3
11.6
0.9
– 1.4
– 4.9
6.2
0.8
– 0.5
6.5
29.8
33.2
The fair value of investment property as of Decem-
ber 31, 2016 totaled € 40.2 million (PY: € 36.1 million).
The valuation carried out by ourselves took place on the
basis of forecasted net cash flows using the DCF meth-
od. The calculation was based on a discount rate of 5.4 %
(PY: 6.1 %) and a terminal growth rate of 4.4 % (PY:
5.1 %). In the previous year, write-ups totaling € 4.9
million were reported under other operating income in
the Services/Holding segment.
In the reporting year, rental income of € 2.4 million (PY:
€ 3.0 million) was generated, with corresponding directly
attributable operating expenses of € 0.4 million (PY:
€ 0.7 million). As in the prior year, directly attributable
expenses for non-rented space of less than € 0.1 million
were incurred.
The future minimum lease payments from investment
property broke down as follows:
€ millions
Due in up to one year
Due in one to five years
Due in more than five years
Total
2016
2015
1.8
4.7
1.0
7.5
1.8
5.7
1.2
8.7
(7) Non-current financial assets
(a) Investments recognized using the equity
method
At the beginning of January 2016, we have finalized –
together with Ringier – the establishment of the company
Ringier Axel Springer Schweiz AG, Zurich, Switzerland
(see note (2c)), in which we have a legal share of 50 %.
The company combines all Swiss-German and West
Swiss magazine titles (including their associated online
portals) as well as the West Swiss broadsheet Le Temps
from Ringier and the entire Swiss business from Axel
126
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
Springer. We account for our investment in this associat-
ed company using the equity method. Due to special
contractual arrangements with regard to profit participa-
tion, the share of the total comprehensive income at-
tributable to us diverges from the legal share. The same
applies in the event of the disposal of the investment, for
which our share is 35 %.
Summarized financial information (pursuant to IFRS)
regarding the investment (including PPA effects and the
goodwill (on a 100% basis)) are shown below:
Summarized financial information regarding all compa-
nies which are accounted for using the equity method
and are not individually material are shown below:
€ millions
Carrying amount
Share attributable to Axel Springer SE:
Income from continued operations
Other income/loss
Comprehensive income
2016
77.2
– 7.9
0.0
– 7.9
2015
91.6
– 6.5
0.0
– 6.5
€ millions
Revenues
Income after taxes
Other income/loss
Comprehensive income
€ millions
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Net assets
2016
255.2
8.1
– 2.5
5.6
12/31/2016
86.1
525.8
– 106.9
– 98.5
406.6
At the date of its establishment, the fair value of our
investment amounted to € 140.2 million (see note (2c)).
Of the total comprehensive income, an amount of
€ 3.5 million is attributable to our share. As of December
31, 2016, thus we disclose a carrying amount of
€ 143.7 million for our investment.
The decrease in the carrying amounts stems primarily
from the disposal of Thrillist Media Group Inc. (see note
(7b)).
Proportionate net income to be recognized in income
from investments were not recorded in the amount of
€ -0.5 million (PY: € 0.0 million), since the respective net
investment had been impaired in the reporting year.
(b) Other non-current financial assets
The other non-current financial assets particularly includ-
ed an amount of € 146.3 million (PY: € 203.8 million)
relating to options secured by bank guarantees for the
sale of our shares in Do⁄an TV ("put options"). In the
reporting year, we sold around 2.3 % of our shares
through exercising our respective options at a price of
€ 55.3 million. No effect on income was recognized. The
valuation of the put options at the balance sheet date is
based on the discounted payment claim deriving from
the agreed option rights, minus all costs to be incurred.
The discount rates were determined according to the
duration of the put options and the default risk, taking
into account the granted bank guarantees.
Also included are the shares of approximately 13 % in
Group Nine Media Inc. (€ 72.3 million) added in the
reporting year which we received in connection with the
disposal of our shares in Thrillist Media Group Inc. and
NowThis Media Inc.
127
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
In addition, other non-current financial assets mainly
included other investments and other loans.
The changes in the allowances for doubtful trade receiv-
ables are presented below:
In the reporting year, we received the premature repay-
ment of the subordinated vendor loan, including capital-
ized interest, from the FUNKE Mediengruppe totaling
€ 247.9 million, which was granted in 2014 in connec-
tion with the sale of our domestic regional newspapers,
as well as program and women's magazines.
(8) Inventories
The inventories broke down as follows:
€ millions
12/31/2016 12/31/2015
Raw materials and supplies
15.4
13.9
Semi-finished goods
Finished goods and merchandise
Inventories
1.0
5.2
0.6
5.6
21.6
20.1
Inventories of € 10.1 million (PY: € 9.7 million) were
valued at their net realizable value. The write-downs for
these assets as of December 31, 2016 totaled
€ 3.0 million (PY: € 2.6 million), of which € –1.6 million
(PY: € –0.4 million) were recognized in income in the
reporting year.
(9) Trade receivables
€ millions
Balance as of January 1
Additions
Reversals
Utilization
Disposal due to deconsolidation
Other changes
Balance as of December 31
2016
26.8
4.8
– 2.5
– 2.0
– 1.6
– 0.1
25.4
2015
26.4
6.0
– 1.7
– 2.2
– 2.2
0.5
26.8
As of December 31, 2016, receivables in the amount of
€ 424.1 million (PY: € 413.3 million) were neither past
due nor subject to valuation allowances. With regard to
these receivables, there were no indications at the re-
porting 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
12/31/2016 12/31/2015
46.3
23.1
6.5
3.6
5.0
48.0
21.8
5.3
5.3
2.5
The trade receivables broke down as follows:
361 days and longer
€ millions
12/31/2016 12/31/2015
Trade receivables, nominal
Allowances for doubtful trade receivables
Trade receivables
640.0
– 25.4
614.6
597.7
– 26.8
570.9
128
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(10) Other assets
The other assets broke down as follows:
€ millions
12/31/2016 12/31/2015
Reimbursement claim for pension
obligations
Derivatives
Other
Other financial assets
Thereof current
Thereof non-current
Advance payments
Receivables from other taxes
Other
Other non-financial assets
Thereof current
Thereof non-current
Other assets
Thereof current
Thereof non-current
26.6
0.6
63.5
90.7
58.1
32.6
33.9
23.7
12.6
70.2
63.2
6.9
160.9
121.3
39.5
27.4
5.1
43.7
76.2
47.6
28.6
24.5
16.8
10.8
52.1
48.6
3.5
128.3
96.2
32.1
Regarding the reimbursement right concerning the pen-
sion obligations, see note (14).
The miscellaneous financial assets particularly included a
purchase price claim for the final instalment regarding the
sale of the office building in Hamburg, debit balances in
accounts payable, security deposits, and receivables
from the insolvency proceedings against the Kirch Group.
(11) Assets held for sale
The assets held for sale and the related liabilities dis-
closed in the previous year as shown in the following
table have been completely disposed of in the reporting
year:
€ millions
Axel Springer Switzerland
CarWale
Office building Hamburg
(part I)
Office building Hamburg
(part II)
Held for sale
12/31/2015
Assets
Liabilities
178.8
20.8
105.2
6.3
311.1
72.4
20.7
67.7
0.0
160.8
In September 2015, Ringier and Axel Springer jointly
decided to set up a company in Switzerland (Ringier Axel
Springer Schweiz AG), which was, like the sale of our
shares in Automotive Exchange Private Limited, Mumbai,
India (CarWale), completed in January 2016. For the
assets and liabilities disposed of, see note (2c).
The sale of the office building complex in Hamburg took
place at the beginning of January (building part I) and at
the beginning of August 2016 (building part II). The pur-
chase price for building part I amounted to € 130.6
million, of which a partial amount of € 115.6 million was
already collected in the previous year and recorded as an
other obligation from down payment (see notes (17) and
(30)). The remaining amount (€ 15.0 million) was not due
as of December 31, 2016. A portion of the purchase
price of € 67.5 million was attributable to the plan assets
formed for our pension obligations and was transferred
accordingly in January 2016. The remaining carrying
amount of building part I (€ 105.2 million) as well as the
associated liability from finance lease (€ 67.7 million)
were derecognized. At the disposal date a provision
(€ 25.9 million) was recognized for the remaining recon-
struction measures; no gain or loss was recorded upon
disposal. The sale of building part II was finalized at a
purchase price of € 80.5 million, resulting in an income
from disposal of € 71.3 million, which was recognized
under other operating income (see note (20)).
129
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(12) Equity
The components and changes in consolidated equity are
summarized in the consolidated statement of changes in
equity.
(a) Subscribed capital
The fully paid-in subscribed capital in the amount of
€ 107.9 million (PY: € 107.9 million) is divided into
107,895,311 (PY: 107,895,311) registered shares with a
calculated ratio of € 1.00 per share. The shares can only
be transferred with the company’s consent. For infor-
mation on the capital increase carried out in the previous
year, see note (12b).
(b) Authorized capital
The annual shareholders’ meeting of April 14, 2015
allowed the Executive Board, with the approval of the
Supervisory Board, to increase the share capital until
April 13, 2020 by up to € 11,000,000 through the issue
of newly registered shares in return for cash and/or con-
tributions in kind (authorized capital). With the approval of
the Supervisory Board, the Executive Board can waive
the subscription right of the shareholders in case of a
capital increase against contributions in kind.
By resolution of the Executive Board of Axel Springer SE
of December 3, 2015, and the approval of the Supervi-
sory Board of the same date, the subscribed capital was
increased by € 8,955,311 to € 107,895,311 through the
issue of 8,955,311 registered shares with profit participa-
tion from January 1, 2015 onwards. The capital increase
was carried out against contributions in kind excluding
subscription rights. The according commercial register
entry was carried out on December 9, 2015. The new
shares were issued in consideration for the acquisition of
company shares (see note (2c)). The value of the contri-
butions in kind totaled € 462.9 million; the resulting pre-
mium in the amount of € 453.9 million was assigned to
paid-in capital.
As of December 31, 2016, the remaining authorized
capital remained unchanged as compared to the previ-
ous year totaling € 2,044,689.
(c) Additional paid-in capital
The additional paid-in capital (€ 500.1 million, PY:
€ 499.8 million) mainly consists of the share premium
achieved from the capital increase against contributions
in kind from the previous year and the amount of imput-
ed compensation for the share-based payment pro-
grams (see note (13)).
(d) Accumulated retained earnings
The accumulated retained earnings comprised the in-
come of the companies included in the consolidated
financial statements, to the extent that they have not
been distributed to shareholders. In the reporting year,
Axel Springer SE distributed an amount of
€ 194.2 million (PY: € 178.1 million) or € 1.80 (PY:
€ 1.80) per qualifying share for the previous reporting
year. For the reporting year 2016, the Executive Board
and the Supervisory Board propose to distribute a divi-
dend of € 1.90 per share entitled to the dividend, in total
representing approximately € 205 million in expected
payments. Payment of the proposed dividend is contin-
gent upon approval at annual shareholders’ meeting on
April 26, 2017.
Moreover, transactions with shareholders are recognized
within the accumulated retained earnings. In the report-
ing year, the acquisition of non-controlling interests in
Land & Leisure AS (see note (2c)) and the concluded
option agreement to acquire the remaining shares in the
zanox Group (see note (2c)) led to a decrease of the
accumulated retained earnings.
(e) Treasury shares
As of December 31, 2016, as in the prior year, we did
not hold any treasury shares.
Within a stock option program in the previous year,
127 thousand treasury shares were issued at their fair
value on the date of issue in the amount of € 51.31 by
conversion of variable compensation tied to performance
of the employees of the Group. In the previous year,
personnel expenses of € 2.7 million were incurred by
granting increases in the conversion amounts, which
were in each case covered by provisions. To service the
program, treasury shares with a fair value of € 6.5 million
130
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
were acquired; shares that were not required were sub-
sequently sold on the market at a fair value of less than
€ 0.1 million. Acquisition, issuing and the sale of treasury
shares had no effect on the level of equity.
(f) Accumulated other comprehensive income
At the balance sheet date, accumulated other compre-
hensive income mainly comprised actuarial gains and
losses from employer pension plans of € –120.4 million
(PY: € –95.2 million). This includes actuarial losses (after
taxes) of € 5.1 million, which were reclassified into ac-
cumulated retained earnings as a result of the deconsoli-
dation of the entire Swiss business from Axel Springer
(see note (2c)).
Primarily due to the sale of investments and furthermore
due to capital repayments from net investments in for-
eign companies, the unrealized gains and losses from
foreign exchange conversions previously recognized
under other comprehensive income in the total amount
of € 40.2 million (PY: € 7.8 million) were reclassified into
the income statement.
(g) Non-controlling interests
The non-controlling interests mainly related to the follow-
ing companies:
As of December 31, 2016 the non-controlling interests in
Ringier Axel Springer Media amounted to 50.0% (PY:
50.0%), whilst their share in the Group net income
amounted to € 13.2 million (PY: € 15.4 million). As in the
previous year, there were no distributions in the reporting
year.
Summarized financial information for the Ringier Axel
Springer Media sub-group are shown in the following
table:
€ millions
Revenues
Net income
Comprehensive income
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Cash flow from operating activities
Cash flow from investing activities
Cash flow from financing activities
2016
267.4
24.8
13.6
133.0
503.2
109.4
36.0
44.0
– 39.7
– 2.9
2015
275.0
31.4
35.2
112.7
518.5
111.2
40.1
43.1
– 45.6
– 61.2
€ millions
12/31/2016
12/31/2015
Regarding the option agreement to acquire the remain-
ing 47.5% shares in the zanox Group see note (2c).
Ringier Axel Springer Media
Group
Immowelt Group
zanox Group
Other companies
Non-controlling interests
243.7
70.9
0.0
106.5
421.2
234.0
71.9
46.6
96.3
448.8
131
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(13) Share-based payment
In the reporting year, the expenses recorded for share-
based payment programs amounted to € – 7.9 million (PY:
€ – 13.3 million). These effects were attributable to equi-
ty-settled programs with an amount of € – 0.2 million (PY:
€ – 0.5 million) and to cash-settled programs with an
amount of € – 7.7 million (PY: € – 12.8 million). The liabil-
ity recorded for share-based payments concerns espe-
cially the following stock option plans and totaled
€ 15.1 million (PY: € 29.6 million).
Members of the Executive Board and selected executives (beneficiaries) were granted various virtual stock option
plans, the fundamental parameters of which are described below:
Grant date
Term in years
Qualifying period in years
Option rights granted
Underlying (€)
Maximum payment (€)
Value at grant date (€)
Total value at grant date (€ million)
Virtual stock option plans
Executive Board Program
Senior Executive Program
2012
2014 I
2014 II
2011 II
2014
01/01/2012
01/01/2014
09/01/2014
10/01/2011
03/01/2014
6
4
6
4
6
4
6
4
5
3
450,000
205,313
675,000
472,500
60,000
30.53
61.06
5.26
2.4
44.06
88.12
6.69
1.4
44.56
89.12
6.26
4.2
35.00
70.00
2.31
1.1
46.80
93.60
8.14
0.5
Provided that the beneficiary is employed by the compa-
ny at least until the expiration of the vesting period, all
virtual stock options granted to the relevant senior exec-
utive may become vested. If the authorized senior execu-
tive's employment with the company ends before the
end of the vesting period, but is at least one year after
the grant date, the stock options are vested on a pro-
rated basis in relation to the vesting period (Executive
Board program), up to one half (senior executive pro-
gram 2014), or to one quarter per elapsed year of the
vesting period (senior executive program 2011 II).
A further condition for vesting to take place is that
either the volume-weighted average price of the Axel
Springer share is at least 30 % over the base value or
that the percentage increase of this average price ex-
ceeds that of the base value of the development of the
DAX over a period of 90 calendar days (Executive
Board program) or three calendar months (senior exec-
utive programs) within a time period of a year before
the end of the waiting period.
Exercising stock options is only possible if the volume-
weighted average price of the Axel Springer share 90
calendar days (Executive Board program) or three calen-
dar months (executive programs) before exercising such
options is at least 30 % over the base value and that the
percentage increase exceeds that of the DAX index.
Each option grants a payment claim in the amount of the
growth in value of the Axel Springer share, restricted to a
maximum of 200 % of the base value, which corre-
sponds to the difference between the volume-weighted
average price during the last 90 calendar days or three
months prior to exercise and the base value.
Beneficiaries are obligated to hold one Axel Springer
share for every ten stock options as their own investment.
Disposing of these shares prior to exercising the stock
132
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
options would result in the stock options being forfeited
at the same rate.
the grant date. The options will be remeasured at each
reporting date and recognized proportionally in accord-
ance with the projected vesting.
The value of the options was determined by application
of a Black-Scholes model in a Monte Carlo simulation at
The development of the stock options is shown below:
01/01/2015
Exercise
Lapse
12/31/2015
Exercise
Lapse
12/31/2016
Virtual stock option plans
Executive Board Program
Senior Executive Program
2012
2014 I
2014 II
2011 II
393,750
205,313
675,000
472,500
0
0
0
0
0
0
0
0
2014
60,000
0
0
393,750
205,313
675,000
472,500
60,000
– 393,750
0
0
0
0
0
0
– 471,650
– 850
0
0
205,313
675,000
0
60,000
The expenses and income in the fiscal year, as well as the portfolio of liabilities and provisions at the reporting date are
shown below:
€ millions
€ millions
€ millions
€ millions
Expenses/Income 2016
Expenses/Income 2015
Carrying amount as of 12/31/2016
Carrying amount as of 12/31/2015
Virtual stock option plans
Executive Board Program
Senior Executive Program
2012
1.7
– 2.9
0.0
8.6
2014 I
2014 II
2011 II
0.5
– 0.3
0.7
1.2
0.9
– 2.2
2.3
3.2
0.5
– 3.8
0.0
8.4
2014
0.2
– 0.1
0.1
0.3
In addition to the virtual stock option plans, as of May 1,
2016, current members of the Executive Board were
granted a new long-term variable remuneration in the
form of a long-term incentive plan (“LTIP“) with a
duration – including lock-up periods – until 2023. The
LTIP stipulates a participation in the increase in the com-
pany value, measured on the basis of market capitaliza-
tion. It will be distributed in the form of a cash bonus and
contains a subsequent obligation to purchase Axel
Springer shares in the corresponding amount.
The compensation entitlement requires market capitali-
zation of Axel Springer SE to increase by at least 40%
within three, four, and maximally five years (respective
“performance periods”). No claim for compensation can
be made below this threshold. In the event of targets
being achieved, the whole Executive Board is entitled to
payment amounting to a total of 4% of the increase in
market capitalization. The compensation entitlement will
increase only up to a growth in market capitalization by
maximally 60%.
133
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
For the stock options program for employees of the
Group see note (12e).
Various free share and stock option programs existed at
our subsidiary SeLoger on the acquisition date. They
provided for granting or exercise by the right holders
from the years 2009 to 2013 onwards, linked with a
subsequent holding period of two years. The stock op-
tions with a weighted average purchase price of € 20.93
expire in 2017 until 2019. The right holders were offered
call and put options as part of the acquisition of SeLoger
for transferring all shares from these programs (up to a
maximum of 525 thousand) to Axel Springer in return for
a cash payment. The call and put options are not linked
to any market-related or company-related or any other
conditions and vest immediately after the issuance of the
shares to the employees. The purchase price upon exer-
cise 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 (€ 36.15 when tak-
ing the share split of 2011 into account).
Following the principle of substance over form, the pro-
grams 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 at the grant date is based on the Black-
Scholes model or the current share price, considering
future dividends. The weighted average fair value at the
date of exercise of the options was €28.83 per virtual
stock option or €15.1 million in total. The virtual options
will be remeasured on each reporting date and recog-
nized proportionally in accordance with the vesting that
has now completely occurred. In the reporting year, all
options were exercised, settled by payment and the
programs closed.
The increase in market capitalization will be calculated on
a basis of share price developments of the Axel Springer
share within the last 90 calendar days before May 1,
2016, or before the end of the respective performance
period, multiplied by the number of outstanding Axel
Springer shares (less treasury shares) adding dividend
payments during the performance period.
In the event of targets being achieved, an amount in the
value of 50% of the total amount (“payout amount I“) will
be paid out. On meeting the targets after four or five
years respectively, a lock-up period of two or one year
respectively follows, before the remaining 50% of the
total amount ("payout amount II") will be paid out. Should
targets be met prematurely after three years, each Exec-
utive Board member will have the option to request
payout amount I. Payout amount II will then only be
remunerated after targets are once again met after four
or five years, and after a lock-up period of two, or one
year respectively.
The net amount of all payouts (after the Executive Board
members’ taxes and duties are paid) in each case has to
be fully invested in Axel Springer shares by the Executive
Board member. Regarding the shares acquired with
payout amount I, or II respectively, the Executive Board
member has to retain the shares for a minimum of two
years, or one year respectively. The LTIP contains the
usual provisions for early resignation. Thus, all non-
contractual claims paid under the LTIP lapse if the mem-
ber of the Executive Board leaves the Executive Board at
his own request before expiry of the waiting period.
The LTIP is valued as a share-based compensation
program with cash settlement at its fair value as of the
balance sheet date and is recorded according to the
expected vesting date.
The value of the LTIP at the grant date was calculated on
the basis of a stochastic model for the valuation of share
option rights at € 32.1million. The computational remu-
neration component for the financial year 2016 recorded
in personnel expenses amounted to € 3.5 million for all
members of the Executive Board. A liability was recog-
nized in the corresponding amount.
134
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
The development of the virtual options is shown below:
in thousands
Option rights as of January 1
Exercise
Option rights as of December 31
€ millions
Personnel expenses
Other operating income (+) / expenses (-)
Liabilities as of December 31
2016
4
–4
0
2016
0.0
0.0
0.0
2015
192
– 188
4
2015
– 0.9
0.0
0.1
Our subsidiary AUFEMININ SA has granted its senior
executives option rights to be settled with shares in
AUFEMININ SA as well as free shares.
In August 2016, senior executives were given the right to
receive a total of 63 thousand free shares in AUFEMININ
SA. The fair value of a free share at the grant date was
€ 26.56 and was based on the current share price on
the stock market taking into account expected dividends.
The free shares will become fully vested two years after
the grant date, provided that the relevant earnings tar-
gets (EBITDA 2016 and EBITDA 2017) have been
reached. As of the balance sheet date, the weighted
average remaining term of the free shares was two years.
In November 2013 and November 2010, 300 thousand
stock options were offered for acquisition of one share of
AUFEMININ SA, each with an exercise price of € 26.19
and € 17.15 respectively were issued to senior execu-
tives. 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 individ-
ual tranche (EBITDA for the fiscal year prior to the year of
vesting) was achieved. Once they have vested, the op-
tions 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 AUFEMININ SA (exercise price: € 20.46), have
become vested in equal annual instalments 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 number of options and the weighted average exer-
cise price developed as follows:
2016
2015
Options in
thousands
Exercise
price1) in €
Options in
thousands
Exercise
price1) in €
Balance as of
January 1
Lapse
Exercise
Balance as of
December 31
Thereof
exercisable
441
– 67
– 124
23.32
24.00
17.16
557
–6
21.62
8.94
– 110
15.50
250
26.19
441
23.32
250
26.19
441
23.32
1) Weighted average exercise price.
The weighted average stock price at the date of exercise
of the stock options during the financial year was
€ 28.94 (PY: € 25.57). The exercise price for options
outstanding at the balance sheet date was € 26.19 (PY:
between € 17.15 and € 26.19). As in the previous year,
the weighted average remaining term of the options was
three years.
The compensation expense for option rights and free
shares recognized in personnel expenses amounted to
€ 0.2 million in the reporting year (PY: € 0.5 million); the
additional paid-in capital was increased accordingly.
Upon closing date of the acquisition with respect to the
majority shareholding in Business Insider at the end of
the previous year (see note (2c)), both management
board members of Business Insider were granted a total
of 21,952 new stock options to acquire shares in Busi-
ness Insider Inc. as a replacement for an existing stock
option program. The new stock options are vested over
a period of ten years. 30 % of these granted stock op-
tions become vested after three years and subsequently,
a further 10 % of the granted stock options become
vested each year over the remaining vesting period. The
option rights become exercisable once they are vested
until the end of the total period of 10 years after grant
135
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
date. The exercise of the options is not dependent upon
any other earnings or market conditions. Should the
employment relationship with the two management
board members be terminated after the first three years,
there is – depending on the reason for the termination –
a purchase obligation on the side of Axel Springer or
rather a right to acquire the shares arising from the op-
tions which have vested. Within a three-month period
after the total period of ten years, the management
board members are entitled to tender all shares that
have been obtained through the options to Axel Springer
at fair value on exercise date, which leads to an irrevo-
cable obligation to be settled in cash. Thus, it is a cash-
settled share-based payment.
At grant date, the fair value of these stock options was
€ 12.9 million. A partial amount of € 7.4 million of the fair
value of the options was treated as consideration trans-
ferred in the course of the initial consolidation for the
acquisition (see note (2c)). The remaining fair value of
€ 5.5 million was classified as remuneration for the con-
tinuing employment of the board members of Business
Insider. The fair value was determined on the basis of an
option pricing model using a Monte Carlo simulation,
taking into account the strike price of the options, the
risk-free interest rate and the expected dividends; the
volatility was derived using a peer group comparison. At
each reporting date, the option rights will be remeasured;
likewise, the personnel expenses to be recorded over the
vesting period will be calculated.
As of December 31, 2016, one management board
member had resigned from the company, so that a total
of 6,098 options have expired. As a result, 15,854 op-
tions exist at the end of the year, none of which are
exercisable. The exercise price to be paid for the option
per share is kUSD 3.6 (k€ 3.4). The weighted average
remaining term of these options was 8.8 years (PY: 9.8
years).
In the reporting year, an amount of € 1.1 million (PY: 0.0
million) in other operating income and an amount of
€ 1.7 million (PY: € 0.2 million) in personnel expenses
was recorded.
The value of the liability as of December 31, 2016 arising
from the option program amounted to € 8.5 million (PY:
€ 7.8 million).
Other share-based payment programs were individually
and in total insignificant for the financial position, liquidity,
and financial performance of the Group.
(14) Pension obligations
The pension obligations in the reporting year relate al-
most exclusively to Group companies domiciled in Ger-
many. The pension obligations outside Germany includ-
ed in the previous year primarily pertained to defined
benefit pension plans in Switzerland, which were reclas-
sified into the disposal group at the end of 2015 (see
note (11)).
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 amounted to € 48.6 million (PY:
€ 51.3 million, of which € 7.8 million to foreign pension
insurance carriers) and were shown as social security
contributions in personnel expenses.
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 reserves for performance-based pension
plans correspond to the cash value of the obligations on
the reporting date less the time value of the plan assets.
Along with general actuarial risks such as risks from
salary and pension increases, longevity risk, and interest
rate risk, these are inflation risk and capital market and
investment risk.
Essentially, three different pension plans exist in the
German Group companies that are subject to the Ger-
man Company Pension Act, and thus to the statutory
regulations relating in particular to vesting, compensation
for inflation in the benefit phase, and insolvency protec-
136
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
tion by the Pensions Guarantee Corporation. The pen-
sion plans are partially financed by premium reserve
funds that are managed by Axel Springer Pensionstreu-
hand e.V. as trustee. The two defined-benefit pension
plans provide for an annual pension for entitled persons
based on fixed amounts that depend for the first pension
plan only on the length of service in the company, and
for the second pension plan additionally on the position
in the company, and are static in the vesting period and
dynamic in the benefit payment period in accordance
with the requirements of the Company Pension Act. The
promises to the Executive Board correspond in their
design to the second pension plan and are additionally
dynamic in the vesting period depending on inflation. The
third pension plan is a defined-contribution benefit in
which a benefit is calculated using fixed factor tables
dependent on converted compensation components.
Ongoing benefits are adjusted from the beginning of
pension payments at 1% p.a.
In the previous year, pension obligations in other coun-
tries relate above all to Switzerland. The employees were
insured against the risks of old age, death, and disability
in various defined-benefit plans in a legally separate
employee benefit fund at an independent third party. The
plan assets outside of Germany were mainly attributable
to the individual redemption values of the reinsurer.
The measurement was based on the following parame-
ters:
Information in %
2016
2015
Discount rate
Salary trend
Pension trend
Germany
Other
countries
1.7
1.5
1.5
2.4
1.75
1.75
0.9
1.0
0
1) The information relates primarily to pension obligations recognized as held for sale
as of December 31, 2015.
137
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
The amount of the provision is almost completely attributable to Germany and was calculated as follows:
€ millions
12/31/2016
12/31/2015
Other
countries
Germany
Present value of defined benefit obligations financed by fund
384.8
394.7
2.9
Total
397.6
Fair value of plan assets
– 162.9
– 161.1
– 2.2
– 163.3
Present value of defined benefit obligations not financed by fund
Provision
Thereof current
Thereof non-current
Reimbursement right
Net obligation
149.6
371.5
21.1
350.4
– 26.6
345.0
101.7
335.3
22.9
312.4
– 27.4
307.9
3.2
3.9
0.0
3.9
0.0
3.9
104.9
339.2
22.9
316.3
– 27.4
311.8
The changes in the present value of the pension obligations are almost completely attributable to Germany and are
presented in the table below:
€ millions
Present value of obligations as of January 1
Change in consolidated companies
Current service cost
Interest expense
Actuarial gains/losses arising from changes in demographic assumptions
Actuarial gains/losses arising from changes in financial assumptions
Payments by employees
Transfer of pension obligation
Exchange rate change
Payments to retirees
Plan curtailments
Reclassification into or from liabilities in connection with assets held for sale (see note (11))
2016
2015
Other
countries
Germany
502.5
533.5
112.9
Total
646.4
– 0.9
9.3
11.3
– 2.7
– 32.2
5.2
0.1
12.2
– 27.9
0.0
0.0
2.1
1.3
– 0.2
0.5
2.2
0.0
12.2
– 6.4
0.0
– 118.5
– 118.5
– 0.3
6.5
11.7
– 2.9
36.2
3.0
0.0
0.0
– 0.9
7.2
10.1
– 2.5
– 32.6
3.0
0.1
0.0
– 22.3
– 21.5
– 0.1
0.0
0.0
0.0
Present value of obligations as of December 31
534.4
496.4
6.1
502.5
138
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
In fiscal year 2017, contributions to fund-financed de-
fined benefit plans are expected to total € 30.4 million
(PY: € 25.3 million, of which € 0.3 million were employer
contributions from Swiss companies).
The fair value of the plan assets is almost completely attributable to Germany and showed the following changes:
€ millions
Plan assets as of January 1
Change in consolidated companies
Income from plan assets
Employee contribution
Employer contribution
Benefits paid
Actuarial gains/losses arising from changes in demographic assumptions
Actuarial gains/losses arising from changes in financial assumptions
Exchange rate changes
Reclassification into liabilities in connection with assets held for sale (see note (11))
2016
2015
Other
countries
Germany
163.3
155.7
91.0
0.0
3.9
0.2
0.3
– 0.6
– 4.2
0.0
0.0
0.0
0.5
3.0
0.0
0.0
0.0
2.0
0.0
0.0
0.0
Total
246.7
0.5
4.0
2.2
1.5
0.0
1.0
2.2
1.4
– 6.3
– 6.3
0.0
1.1
10.1
– 98.3
2.2
2.0
1.1
10.1
– 98.3
163.3
Plan assets as of December 31
162.9
161.1
The investment portfolio for the plan assets is almost completely attributable to Germany and broke down as follows:
€ millions
Shares
Bonds
Money market instruments
Cash and cash equivalents
Others
Plan assets with market price quotations
Real Estate
Others
Plan assets without market price quotations
12/31/2016
12/31/2015
Other
countries
Germany
36.2
43.0
0.6
75.1
7.3
162.1
0.5
0.2
0.7
18.6
53.3
12.3
9.4
0.0
93.6
67.5
0.0
67.5
Total
19.3
53.8
12.3
9.6
0.0
95.0
68.1
0.2
68.3
163.3
0.7
0.5
0.0
0.2
0.0
1.4
0.6
0.2
0.8
2.2
Total
162.9
161.1
139
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
In the previous year, the fair value of the plan assets
included real estate used by the company itself in the
amount of € 55.4 million.
Plan assets recognized as held for sale as of Decem-
ber 31, 2015 totaling € 98.3 million contained plan
assets with an amount of € 77.0 million (thereof
€ 73.8 million Bonds and € 3.1 million Shares) which
have market price quotations and plan assets with an
amount of € 21.3 million (thereof € 15.9 million Real
Estate and € 5.4 million Others) which do not have
market price quotations.
Axel Springer SE is entitled to reimbursement of pension
obligations or pension expenses arising in connection
with them in the context of the outsourcing of rotogra-
vure printing operations in 2005. The reimbursement
right was presented as an other financial asset, whereas
in the income statement, the income from the reim-
bursement was netted with the corresponding pension
expenses. Based on the existing contractual regulations,
we do not assume a short-term settlement of the reim-
bursement claim and the corresponding pension obliga-
tions any more, and therefore in the reporting period, we
classified the asset as well as the related pension liability
in an amount of € 24.4 million (PY: € 25.1 million) as
non-current. The remaining amount of € 2.2 million (PY:
€ 2.3 million) was classified as current.
The value of the reimbursement right developed as fol-
lows:
€ millions
Reimbursement right as of January 1
Income from reimbursement rights
Paid-out benefits
Actuarial gains/losses arising from
changes in demographic assumptions
Actuarial gains/losses arising from
changes in financial assumptions
Reimbursement right
as of December 31
2016
27.4
0.6
– 2.2
2015
30.6
0.6
– 2.3
– 0.2
0.0
1.0
– 1.6
26.6
27.4
The expenses for defined benefit pension plans are almost completely attributable to Germany and broke down as
follows:
€ millions
Current service cost
Interest expense
Income from plan assets
Income from reimbursement rights
Plan curtailments
Pension expenses
2016
6.5
11.7
– 3.9
– 0.6
– 0.1
13.5
2015
Other
countries
Germany
7.2
10.1
– 3.0
– 0.6
0.0
13.7
2.1
1.3
– 1.0
0.0
– 1.9
0.5
Total
9.3
11.3
– 4.0
– 0.6
– 1.9
14.3
140
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
Service cost is presented within the personnel expenses.
The interest portions contained in the pension expenses
and the income from the plan assets and interest reim-
bursements are presented as components of interest
expenses.
An increase or decrease in the material actuarial as-
sumptions would have the following effects on the pre-
sent value of the total pension obligations as of the bal-
ance sheet date:
Information
in %
2016
Discount rate
Salary trend
Pension trend
Increase by
25 basis points
Decrease by
25 basis points
– 3.4
0.1
2.4
3.7
– 0.1
– 2.3
The sensitivity calculations are based on the average
term of the pension obligations calculated as of the bal-
ance sheet date. The calculations were carried out in
isolation for the actuarial parameters classified as materi-
al. As the sensitivity analysis is based on the average
term of the expected pension obligations and as a con-
sequence, the expected payment dates are not taken
into account, they only lead to approximate information
or to describe tendencies. In case of changes to the
mortality rates or life expectancies which act as a basis,
it is assumed that if life expectancy of the beneficiary
increases by one year as of December 31, 2016, pen-
sion obligations in Germany would have risen by 3.1%
(PY: 3.0% in Germany and 1.7% in the remaining coun-
tries).
As of December 31, 2016, the weighted average dura-
tion of the defined benefit obligation was 15 years (PY:
14 years in Germany and 17 years in other countries).
Information
in %
2015
Increase by
25 basis points
Decrease by
25 basis points
Germany
Other
countries
Germany
Other
countries
Discount rate
– 3.3
– 1.7
Salary trend
Pension trend
0.0
2.4
0.4
1.1
3.5
0.0
– 2.3
1.8
– 0.4
0.0
1) The information relates primarily to pension obligations recognized as held for sale
as of December 31, 2015.
141
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(15) Other provisions
The other provisions broke down as follows:
€ millions
01/01/2016 Utilization Reversals Additions
Other obligations towards employees
113.2
– 84.3
– 3.7
72.3
Balance
as of
Partial early retirement program
(Altersteilzeit)
Structural measures
Discounts and rebates
Returns
Other taxes
Dismantling obligations
Litigation expenses
Other
Other provisions
42.1
44.8
14.9
21.3
7.6
7.7
5.6
– 10.9
– 33.9
– 13.0
– 20.4
– 0.4
– 0.2
– 0.8
0.0
– 1.5
– 0.7
– 0.7
0.3
– 0.4
– 0.7
11.4
19.1
13.2
10.9
2.0
0.5
1.4
42.3
– 23.7
299.6
– 187.6
– 15.9
– 23.4
31.0
161.8
Other
changes
Balance
as of
12/31/2016
Thereof
current
Thereof
non-
current
1.4
0.2
0.2
0.0
0.8
0.0
0.2
– 0.1
0.0
2.7
98.9
76.3
22.6
42.7
28.8
14.4
11.9
9.4
7.8
5.5
10.1
24.1
14.4
11.9
9.4
1.3
4.7
33.7
31.1
32.6
4.7
0.0
0.0
0.0
6.5
0.8
2.7
253.0
183.2
69.8
Other obligations towards employees primarily included
variable compensation tied to performance. Structural
measures were mainly allocated to the newspaper and
magazine as well as distribution and sales divisions, and
printing plants. Provisions for returns comprised the
expected sales returns of publishing products. Other
provisions mainly involved restructuring measures still to
be implemented in connection with the sale of the office
building complex in Hamburg and guarantee obligations
in the context of the takeover of the domestic regional
newspapers, TV program guides, and women's maga-
zines by FUNKE Mediengruppe.
The other changes resulted from the initial consolidation
of acquired companies, currency translation differences,
and also from compounding.
(16) Financial liabilities
The financial liabilities comprised liabilities from a promis-
sory note in the amount of € 577.5 million (PY:
€ 632.9 million), other liabilities due to banks amounting
to € 681.2 million (PY: € 618.6 million), as well as from
finance leases of € 0.6 million (PY: € 1.4 million). The
maturity of the financial liabilities included current liabili-
ties of € 1.0 million (PY: € 57.6 million) and non-current
liabilities of € 1,258.3 million (PY: € 1,195.3 million).
142
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
The promissory note was characterized by the following
utilizations, interest rates, and maturities at the reporting
date.
(17) Other liabilities
The other liabilities broke down as follows:
2016 €
million
2015 €
million
Interest rate in %
Maturity
€ millions
12/31/2016 12/31/2015
177.0
162.0
112.0
71.5
58.0
0.0
177.0
162.0
112.0
1.47 10/12/2020
1.034 10/11/2018
3.06 04/11/2018
71.5 6-month EURIBOR + 0.9 10/12/2020
58.0 6-month EURIBOR + 0.7 10/11/2018
Contingent consideration and other put
options for purchase of non-controlling
interests
Debit balances in accounts receivable
Liabilities from derivatives
Payments received from disposal of real
estate
56.5
2.38 04/11/2016
Other
The other liabilities due to banks were characterized by
utilization, 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.
2016 €
million
190.0
300.0
130.0
60.0
2.9
2015 €
million
68.0
0.0
Interest rate in %
Maturity
Accrued liabilities
250.0
1-month EURIBOR + 0.50 07/03/2020
Capital investment subsidies
300.0
3-month EURIBOR + 0.80 07/22/2020
Liabilities due to social insurance carriers
Eonia + 0,425 07/03/2020
Liabilities for duties and contributions
Eonia + 0,475 07/03/2020
3.4
3-month EURIBOR + 0.30 10/15/2022
Other financial liabilities
Thereof current
Thereof non-current
Advance payments from customers
Liabilities from other taxes
Liabilities due to employees1)
Advance payments
Payments received from disposal of real
estate
Other2)
Other non-financial liabilities
Thereof current
Thereof non-current
Other liabilities
Thereof current
Thereof non-current
The interest rates were mainly equivalent to the effective
rates of interest. In the case of fixed-interest loan tranch-
es, the interest rates were fixed until the maturity date.
Furthermore, on the reporting date additional unused
short-term and long-term credit facilities amounted to
€ 840.0 million (PY: € 902.0 million).
On the reporting date liabilities from finance leases in the
prior year in the amount of € 62.9 million, which are
linked with the sale of the office building complex in
Hamburg, were disclosed as liabilities related to assets
held for sale, see note (11).
1) Disclosed in prior year under financial liabilities.
2) Proportionate reclassification of prior-year figures into advance payments from
customers.
The advance payments received from the disposal of real
estate were linked to the office building complex in
Hamburg that was sold at the beginning of 2016. A
portion of the received purchase price in the amount of
€ 67.5 million was attributable to the plan assets set up
143
511.5
513.1
13.4
12.9
0.0
33.7
571.6
379.6
192.0
173.5
68.0
41.8
27.8
19.9
10.0
9.5
4.9
0.0
29.7
385.1
365.5
19.5
15.2
55.4
67.5
47.4
698.6
319.5
379.1
132.5
55.0
36.8
15.2
19.8
10.9
11.0
5.5
48.1
16.6
351.3
337.4
13.9
956.7
1,049.8
745.1
211.6
656.8
393.0
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
for our pension commitments. This part was paid out to
the plan assets in January 2016.
The advance payments from customers and the advance
payments primarily increased due to the initial consolida-
tion of acquired companies in the reporting year. Liabili-
ties due to employees related to outstanding wage and
salary payments, management bonuses, and severance
award claims. Accrued liabilities contained liabilities re-
sulting from overtime and unused vacation.
(18) Maturity analysis of financial liabilities
The contractually agreed (undiscounted) payments related to financial liabilities are presented in the following table:
€ millions
Financial liabilities
Contingent consideration and other put options for purchase of non-controlling
interests
Other non-derivative financial liabilities
Derivative financial liabilities
€ millions
Financial liabilities
Contingent consideration and other put options for purchase of non-controlling
interests
Other non-derivative financial liabilities1)
Derivative financial liabilities
1) Prior-year figures were adjusted, see note (17)
Undiscounted cash outflows
Carrying
amount
as of
12/31/2016
2017
2018– 2021
2022 ff.
1,259.3
14.2
1,286.5
511.5
450.0
12.9
333.1
437.2
12.5
177.2
10.5
0.4
0.5
7.0
2.2
0.0
Carrying
amount
as of
12/31/2015
Undiscounted cash outflows
2016
2017– 2020
2021 ff.
1,252.9
71.4
1,245.8
513.1
483.9
55.4
208.5
475.4
0.3
305.5
6.4
55.0
1.0
7.0
2.0
0.0
144
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
in connection with the establishment of Ringier Axel
Springer Schweiz AG, jointly founded by Axel Springer
and Ringier (see note (2c)). Income from the disposal of
property, plant and equipment resulted in € 71.3 million
from the sale of the Hamburg office building complex
(see note (11)). The miscellaneous operating income
contained a large number of non-material items.
Change in inventories and internal costs capital-
ized increased to € 82.6 million (PY: € 47.3 million) in
the reporting year and mainly related to extensive IT
development projects to develop and expand our digital
business models.
(21) Purchased goods and services
The purchased goods and services broke down as fol-
lows:
€ millions
2016
2015
Raw materials and supplies and
purchased merchandise
Purchased services
146.5
825.0
158.9
854.6
Purchased goods and services
971.5
1,013.5
Raw materials and supplies and purchased merchandise
comprised paper costs amounting to € 52.9 million (PY:
€ 63.4 million).
The cost of purchased services was predominantly
composed of purchased third-party printing services and
professional fees, as well as publisher services in the
context of performance-based marketing. The pur-
chased third-party printing services also included paper
costs.
Notes to the consolidated statement
of comprehensive income
(19) Revenues
The revenues broke down as follows:
€ millions
Advertising revenues
Circulation revenues
Printing revenues
Other revenues
Revenues
2016
2015
2,223.1
2,107.6
646.9
721.7
54.6
59.3
365.7
406.3
3,290.2
3,294.9
During the fiscal year, revenues from barter transactions
amounted to € 56.4 million (PY: € 54.2 million). These
revenues were generated mainly from the bartering of
advertising services.
(20) Other operating income and change in
inventories and internal costs capitalized
The other operating income broke down as follows:
€ millions
Gain on disposal of subsidiaries
Income from disposal of intangible assets
and property, plant and equipment
Income from reversal of provisions
Foreign exchange gains
Subsequent valuation of contingent
purchase price liabilities and other put
options for purchase of non-controlling
interests
Write-ups
Miscellaneous operating income
2016
207.2
71.8
20.2
3.8
1.6
0.0
35.2
2015
112.9
20.4
12.4
7.1
27.1
5.0
87.0
Other operating income
339.9
271.8
Gains on disposal of subsidiaries were largely attributable
to the sale of the Automotive Exchange Private Limited
(CarWale) and the disposal of the entire Swiss business
145
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(22) Personnel expenses
(23) Depreciation, amortization, and impairments
The personnel expenses broke down as follows:
The depreciation, amortization, and impairments broke
down as follows:
€ millions
Wages and salaries
Social security
Pension expenses
Expenses for share-based payments
Other benefit expenses
2016
940.9
138.0
8.7
7.9
4.6
2015
932.8
138.2
11.8
13.3
4.2
Personnel expenses
1,100.1
1,100.3
The average number of employees in the Group is
shown below:
€ millions
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
Depreciation, amortization, and
impairments
2016
173.8
2015
139.7
2.6
1.9
54.3
56.9
1.1
0.8
0.3
0.9
232.6
199.8
Salaried employees
Editors
Wage-earning employees
Total employees
2016
2015
11,797
11,572
2,888
2,730
638
721
15,323
15,023
The increase in the amortization of other intangible as-
sets primarily resulted from increased ongoing invest-
ments as well as increased effects of purchase price
allocations.
Impairment losses in financial assets recognized in the
fiscal year are included in the income from investments.
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.
146
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(24) Other operating expenses
The other operating expenses broke down as follows:
€ millions
Advertising expenses
Expenses for non-company personnel
Mailing and postage expenses
Rental and leasing expenses
Consulting, audit and legal fees
Commissions and gratuities
Maintenance and repairs
Subsequent valuation of contingent
purchase price liabilities and other put
options for purchase of non-controlling
interests
Travel expenses
Training of employees
Services provided by related parties
Allowances for doubtful receivables
Other taxes
Foreign exchange losses
2016
243.1
161.0
77.7
61.0
51.9
36.6
31.1
30.4
30.3
12.5
11.8
10.2
8.2
5.1
2015
234.1
143.0
94.2
52.5
64.5
41.6
38.9
18.8
31.4
14.0
8.3
15.3
6.1
7.6
Miscellaneous operating expenses
80.1
91.8
Other operating expenses
851.2
862.2
The miscellaneous operating expenses included addi-
tions to provisions relating to legal and other risks, as
well as other operating expenses.
The following professional fees for the services rendered
by the auditor Ernst & Young GmbH were recognized:
€ millions
2016
20151)
Audits of the annual financial statements
Other certification or appraisal services
Tax advisory services
Other services
Total professional fees
1.2
0.0
0.4
0.4
2.1
1.1
0.1
0.3
0.6
2.1
1) Prior-year figures adjusted due to a change in legal requirements regarding the
disclosure of fees.
The professional fees for the audit of financial statements
included the audit of the separate financial statements of
Axel Springer SE and other German subsidiaries, the
consolidated financial statements and the auditor’s re-
view of the half-year financial report. The tax advisory
fees were a result of support services regarding specific
tax questions. Other services consisted of due diligence
services as part of acquisitions within the fiscal year.
(25) Income from investments
The income of companies accounted for using the equity
method amounted to € 23.4 million (PY: € 1.7 million). It
consisted of our share in the investee’s net income (see
note (7a)), impairment losses of € 2.5 million (PY:
€ 3.6 million) as well as the income from the disposal of
Thrillist Media Group Inc. of € 29.2 million (see note (7)).
In the previous year, the income of companies account-
ed for using the equity method included gains from re-
valuations carried out as part of step acquisitions in the
amount of € 9.6 million.
The other investment income of € 16.8 million (PY:
€ 23.0 million) included dividends received from other
investments and income from the disposal of NowThis
Media Inc. in the amount of € 5.6 million (see note (7b)).
In the previous year, the other operating income included
gains from revaluations carried out as part of step acqui-
sitions in the amount of € 12.1 million.
147
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(26) Financial result
(27) Income taxes
The income taxes paid or owed and the deferred taxes are
recognized under income taxes. The income taxes consist
of trade tax, corporate income tax, and solidarity sur-
charge, and the corresponding foreign income taxes. The
income tax expenses are broken down below:
€ millions
Current taxes
Deferred taxes
– 14.9
– 16.7
Income taxes from discontinued
operations
2016
149.0
– 22.9
2015
134.9
1.3
126.1
136.2
The net financial result broke down as follows:
€ millions
Interest income from bank accounts
Interest income from loans and securities
Interest income from taxes
Other interest income
Interest income
Interest expenses on liabilities due to
banks and on promissory note
Interest expenses on pension provisions,
less reimbursements
Interest expenses from compounding
Miscellaneous interest expenses
Interest and similar expenses
Other financial result
Financial result
2016
1.2
8.0
1.7
1.8
2015
1.6
14.6
1.6
5.6
12.7
23.3
– 7.2
– 3.6
– 3.1
– 28.7
– 5.4
– 6.8
– 4.8
– 10.7
– 39.0
– 6.5
– 21.4
– 22.2
A total of € 10.7 million (PY: € 20.8 million) of the interest
income and € – 16.9 million (PY: € – 27.1 million) of the
interest expense was allocated to financial assets and
liabilities that were not measured at fair value through profit
or loss.
Income taxes from continued operations
0.9
1.3
Income taxes
126.9
137.5
The expected income tax expense – applying the tax
rate of Axel Springer SE – is reconciled to the income tax
expense recognized in the income statement as follows:
€ millions
Income before income taxes
2016
576.1
2015
440.8
Tax rate of Axel Springer SE
31.00 %
31.00 %
Expected tax expenses
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
178.6
– 13.8
– 19.3
0.4
10.8
4.2
1.6
9.5
136.6
– 5.2
– 1.6
– 6.0
25.5
5.2
– 1.8
18.0
– 43.3
– 30.6
1.6
– 4.1
1.9
– 5.7
126.1
136.2
148
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
Companies with the legal form of a corporation domiciled
in Germany are subject to corporate income tax at the
rate of 15% and solidarity surcharge of 5.5% of the cor-
porate income tax owed. In addition, the profits of these
companies are subject to trade tax, for which the
amount is municipality-specific. Companies with the legal
form of a partnership are subject to trade tax exclusively.
The net income is assigned to the shareholder for pur-
poses of corporate income tax. The group tax rate re-
mains unchanged at 31.0%.
The effects of different tax rates for partnerships and for
foreign income taxes from the tax rate applicable to Axel
Springer SE are explained in the reconciliation in the item
differing tax rates. The permanent differences result
mainly from impairment losses in goodwill and deconsol-
idation effects that are not taken into account for tax
purposes. The adjustments made to the carrying
amounts of deferred taxes included € 17.3 million (PY:
€ 13.0 million) for the non-recognition of deferred taxes
on tax loss carry-forwards. In addition, effects from the
first-time recognition of deferred tax assets are included.
Deferred tax assets and liabilities were recognized to
account for temporary differences and tax loss carry-
forwards, as follows:
€ millions
12/31/2016
12/31/2015
Deferred
tax assets
Deferred
tax
liabilities
Deferred
tax assets
Deferred
tax
liabilities
13.3
463.1
25.8
449.3
1.8
0.8
0.6
79.2
0.3
0.0
2.1
0.8
0.6
93.2
0.7
0.0
52.5
10.2
31.9
10.0
21.4
0.5
11.4
15.0
11.1
5.4
41.0
14.9
35.5
0.7
5.1
6.4
116.5
599.7
123.0
565.5
7.7
0.0
8.1
0.0
124.2
599.7
131.1
565.5
Intangible
assets
Property, plant,
and equipment
and investment
property
Non-current
financial assets
Inventories
Receivables
and other
assets
Pension
provisions
Other
provisions
Liabilities
Temporary
differences
Tax loss
carry-
forwards
Total
Offsetting
– 69.3
– 69.3
– 84.3
– 84.3
Amounts as
per balance
sheet
55.0
530.5
46.8
481.2
The increase in deferred tax liabilities related to intangible
assets mainly resulted from initial consolidations that
took place during the fiscal year. The development of the
deferred taxes regarding property, plant, and equipment
and investment property as well as liabilities concerns
particularly the disposal of the office building complex in
Hamburg (see note (11)). The increase in deferred tax
assets for pension provisions results from lower interest
rates for IFRS purposes.
149
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
an amount of € 4.4 million (PY: € 2.8 million) can be
carried forward for up to five years and an amount of
€ 1.9 million (PY: € 3.3 million) can be carried forward for
six to ten years. The utilization of tax loss carry-forwards
or interest carry-forwards that had not previously been
recognized as deferred tax assets caused a reduction in
income tax expenses of € 2.3 million (PY: € 0.9 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 € 0.3 million (PY:
€ – 2.3 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 consolidat-
ed balance sheet and the corresponding investment
balance recognized in the financial statements for tax
purposes, e.g. by retaining profits. Deferred tax liabilities
were not recognized on differences of € 8.2 million (PY:
€ 9.0 million) because a realization is not planned at the
present time. In the case of sale or profit distribution, 5%
of the gain on disposal or the dividend, respectively,
would be subject to taxation in Germany; in addition,
foreign withholding taxes might be incurred.
The net balance of deferred tax items from January 1 to
December 31, 2016 was derived as follows:
€ millions
Deferred tax assets as of January 1
2016
46.8
2015
54.4
Deferred tax liabilities as of January 1
– 481.2
– 327.9
Net tax position as of January 1
– 434.4
– 273.5
Deferred tax of current year
22.9
– 1.3
Changes in deferred taxes recognized in
other comprehensive income
11.0
– 11.7
Changes in consolidation group
– 75.0
– 151.3
Reclassification into assets and liabilities
held for sale
0.0
3.4
Net tax position as of December 31
– 475.5
– 434.4
Deferred tax assets as of December 31
55.0
46.8
Deferred tax liabilities as of December 31
– 530.5
– 481.2
Of the deferred tax assets, an amount of € 49.2 million
(PY: € 39.2 million), and of the deferred tax liabilities, an
amount of € 1.0 million (PY: € 9.0 million) can be realized
in the short term.
The amount of deferred tax assets to be disclosed in
accordance with IAS 12.82 was € 4.5 million (PY:
€ 4.4 million). It is expected that this amount can be
realized by utilization against the available operating
income.
Deferred taxes in the total amount of € 50.6 million (PY:
€ 40.9 million) were recognized directly in equity, as they
relate to matters that were likewise recognized directly in
equity.
In the fiscal year, no deferred tax assets were recognized
with respect to corporate income tax loss carry-forwards
amounting to € 209.6 million (PY: € 147.0 million), and
with respect to trade tax loss carry-forwards amounting
to € 45.4 million (PY: € 39.0 million) because it did not
appear probable that sufficient taxable income could be
generated for these amounts in the near future. In addi-
tion, there are interest carry-forwards amounting to
€ 1.9 million (PY: € 1.9 million) for which no deferred tax
assets were recognized. Of these tax loss carry-forwards,
150
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(28) Earnings per share
The earnings per share were determined as follows:
Result of continued
operations attributable to
shareholders of Axel
Springer SE
Result of discontinued
operations attributable to
shareholders of Axel
Springer SE
Net income attributable to
shareholders of Axel
Springer SE
Weighted average shares
outstanding
Earnings per share from
continuing operations
(basic/diluted)
Earnings per share from
discontinued operations
(basic/diluted)
Net income attributable to
shareholders of Axel
Springer SE per share
(basic/diluted)
2016
2015
€ millions
425.4
249.6
€ millions
1.9
2.8
€ millions
427.3
252.4
000s
107,895
99,682
€
€
3.94
2.50
0.02
0.03
€
3.96
2.53
(29) Other income/loss
The other income/loss broke down as follows:
2016
2015
€ millions
Before tax Tax effect
Net Before tax Tax effect
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
– 36.4
– 47.0
13.6
0.2
– 1.9
– 71.5
11.0
0.0
0.0
0.0
0.0
11.0
– 25.3
– 47.0
13.6
0.1
36.1
60.2
12.1
0.2
– 11.6
0.0
0.0
– 0.1
– 1.9
– 2.6
0.0
– 60.5
105.9
– 11.7
Net
24.5
60.2
12.1
0.2
– 2.6
94.3
151
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
Notes to the consolidated statement of
cash flows
(30) Other disclosures
The following table provides details of sales proceeds,
paid up amounts, and disposed assets and liabilities
arising from transactions with loss of control (see note
(2c) for the major transactions):
The cash and cash equivalents were composed of short-
term available cash in banks, securities, cash on hand,
and checks.
Additions in both intangible assets and property, plant,
and equipment of € 5.3 million (PY: € 7.9 million) were
not yet reflected in cash.
The acquisition costs, cash payments, and purchased
assets and liabilities for business acquisitions are pre-
sented in the following table (see note (2c) for the major
acquisitions):
€ millions
Intangible assets
Property, plant, and equipment
Non-current financial assets
Trade receivables
Other assets
Cash and cash equivalents
2016
220.6
10.2
1.1
14.2
29.1
22.4
2015
472.0
3.9
0.3
39.9
7.1
53.0
Provisions and other liabilities
– 53.8
– 56.4
Deferred tax liabilities
– 80.3
– 157.0
Net assets
Acquisition cost (preliminary)
Thereof paid
163.6
307.2
293.7
362.7
756.4
644.5
The amounts from the purchases of shares in consoli-
dated subsidiaries and business units less cash and
cash equivalents acquired reported in the cash flow
statement, in addition to the cash payments and ac-
quired funds listed in the table, also include payments for
acquisitions of the previous years (in particular payments
from contingent considerations totaling € 93.4 million
(PY: € 39.2 million); see note (34)).
€ millions
Goodwill
Other intangible assets
Property, plant, and equipment and non-
current financial assets
Trade receivables
Other assets
Cash and cash equivalents
Provisions and other liabilities
Deferred tax liabilities
Disposal net assets
Net realizable value
Thereof paid-up
2016
83.3
107.1
5.8
16.7
20.0
13.7
– 97.9
– 16.0
132.6
268.1
90.9
2015
44.5
17.7
2.1
32.0
18.1
8.4
– 42.6
– 6.4
73.9
172.5
172.5
Besides the received purchase prices (after taxes), the
proceeds from disposals (after taxes) comprised in par-
ticular the addition of the net assets of € 163.9 million in
connection with the establishment of the company
Ringier Axel Springer Schweiz AG, see note (2c). The
disclosure of cash inflows from divestitures in the cash
flow statement is made under proceeds from disposals
of consolidated subsidiaries and business units less cash
and cash equivalents given up.
The payments from the disposal of financial assets,
including repayment of the vendor loan, amounting to
€ 247.9 million relate to the early repayment of the sub-
ordinated vendor loan including capitalized interest from
the FUNKE Mediengruppe, see note (7b).
152
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
magazines of the BILD brand family, B.Z. and the music
magazines.
International Paid Models include Axel Springer's digital
and printed media services in Europe and the USA. In
Europe our main areas of representation are in Poland,
Slovakia, Serbia, Hungary, Switzerland, Belgium and
Spain. Onet.pl and azet.sk, the leading internet portals in
Poland and Slovakia, also belong to this sub-segment. In
the USA, we are represented with businessinsider.com
since October 2015 and additionally with eMarketer
since July 2016.
The Marketing Models segment compromises all domes-
tic and foreign business models whose revenues are
primarily generated by advertising customers in market-
ing based on performance or reach. These include, in
particular, the performance-based activities of the zanox
Group (including Digital Window) as well as the reach-
based marketing offers of Idealo, auFeminin, finanzen.net
and Bonial.
The Services/Holding segment comprises group services
including IT, printing plants, real estate management,
gastronomy, and financial and personnel services, as
well as holding functions such as accounting, controlling,
finance, law, tax, HR, internal audit, mergers & acquisi-
tions, and communication. Group services are pur-
chased by customers within the Group and are priced at
arm’s length.
(b) Geographical information
The activities of the Axel Springer Group are conducted
mainly in Germany, other European countries, and the
USA.
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.
The other financing activities within the cash flow from
financing activities include the transfer to the plan assets
of € 67.5 million, which was part of previous year's pur-
chase price for the sale of the Hamburg office building
complex, see note (11) and note (17).
Regarding cash inflows and outflows with respect to
discontinued operations, see note (2d).
Notes to the consolidated segment report
(31) Basic principles of segment reporting
The segment reporting reflects the internal management
and reporting structures. The reporting format is broken
down into the three operating segments, those being
Paid Models, Marketing Models, and Classifieds Ad
Models. In addition, there is the Services/Holding seg-
ment.
Segmentation of assets, liabilities, and investments
based on the operating segments does not occur as
these measures do not serve as a basis for decision
making at segment level.
(a) Operating segments
All business models which predominantly generate reve-
nues in online classified advertising are summarized in
the Classified Ad Models segment. Our portfolio com-
prises leading domestic and foreign online classified
portals focusing on real estate, jobs and cars, as well as
general classifieds. Our online classifieds portals include
the real estate portals SeLoger, Immoweb, Immo-
welt/Immonet, the job portals of the StepStone Group
(including the portals Totaljobs and Jobsite), the regional
portal meinestadt.de, the portals of @Leisure for holiday
properties (incl. the portals Traum-Ferienwohnungen and
DanCenter acquired in 2016), as well as the car and
generalist classified ad portals LaCentrale and Yad2.
The Paid Models segment comprises all business mod-
els that are primarily used by paying readers. National
Paid Models include the digital and print media of the
BILD and WELT Group, the computer, car and sport
153
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(32) Segment information
The segment information was compiled on the basis of
the recognition and measurement methods applied in
the consolidated financial statements.
The external revenues comprise circulation revenues
from the sale of publishing products, advertising reve-
nues, 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, which illustrates
earnings before interest, taxes, depreciation and amorti-
zation, as well as EBIT, which is defined as earnings
before interest and taxes, to measure segment results. In
calculating this performance figure, non-recurring effects
and effects of purchase price allocations are eliminated.
Non-recurring effects include effects from the acquisition
and disposal (including contribution) of subsidiaries,
business divisions, and investments (including effects
from the subsequent valuation of contingent considera-
tions and other option liabilities for the acquisition of non-
controlling interests), as well as impairment and write-
ups of investments, effects from the sale of real estate,
impairments, and write-ups of real estate used for own
operational purposes, plus, since this reporting period,
expenses related to the long-term incentive plan for the
current Executive Board members granted at the begin-
ning of May 2016. Purchase price allocation effects
include the expenses of amortization, depreciation, and
impairments of intangible assets, and property, plant,
and equipment from the acquisition of companies and
business divisions.
The breakdown of the eliminated non-recurring effects from the EBITDA and EBIT into the segments is shown below:
€ millions
Effects from acquisitions of
subsidiaries and investments
Subsequent valuation of contingent
consideration and other option
liabilities for the acquisition of non-
controlling interests
Effects from initiated and finalized
disposals of subsidiaries, investments
and real estate
Impairment on investments
Executive Board Program 2016 (LTIP)
Non-recurring effects
2016
2015
Classified
Ad Models
Paid
Models
Marketing
Models
Services/
Holding
Classified
Ad Models
Paid
Models
Marketing
Models
Services/
Holding
– 2.6
– 17.0
– 0.4
0.0
– 5.0
10.4
9.0
0.0
– 20.2
– 3.0
– 6.6
0.0
– 2.3
12.1
– 0.7
0.0
77.4
– 0.5
0.0
54.1
94.0
0.0
0.0
74.0
50.3
– 2.5
0.0
40.9
69.1
0.0
– 3.5
65.6
– 7.5
– 3.6
0.0
64.4
27.3
– 5.1
0.0
0.0
0.0
0.0
0.0
0.0
– 18.5
86.9
35.6
– 5.1
The effects from business acquisitions are mainly at-
tributable to the Paid Models segment, mainly resulting
from the effects of purchase price allocations in connec-
tion with the acquisition of eMarketer and the establish-
ment of Ringier Axel Springer Schweiz AG (PY: mainly
income from the revaluation of step acquisitions of Busi-
ness Insider (Paid Models) and Bonial Enterprises (Mar-
keting Models)).
The effects of the subsequent valuation of contingent
consideration and other option liabilities for the acquisi-
tion of non-controlling interests relate primarily to Im-
mowelt and Immoweb in the reporting year (both Classi-
fied Ad Models) (PY: ONET (Paid Models), as well as
154
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
Other disclosures
(33) Capital management
Beyond the provisions of German law applicable to stock
corporations, Axel Springer SE 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 manage-
ment are subordinate to the earnings-driven financial key
figures.
We can utilize the funds derived from the promissory
notes (€ 580.5 million) and also avail ourselves of our
long-term credit lines (€ 1,500.0 million), both for general
business purposes as well as to finance acquisitions.
In the reporting period, a tranche of the promissory note
was due. The financing volume of our credit lines and
their maturity remained unchanged. In addition to the
promissory notes with a maturity of up to April 2018
(nominal value of € 112.0 million), to October 2018
(nominal value of € 220.0 million) and to October 2020
(nominal value of € 248.5 million), there are credit lines
amounting to € 1,500.0 million, the utilization of which is
due for repayment in July 2020. The utilization of the
credit lines is tied to compliance with covenants. 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 10.0% of the subscribed capital as of
the date of the resolution at the annual shareholders’
meeting on the authorization to acquire treasury shares
on April 16, 2014. Treasury shares can be used for ac-
quisition financing or they can be retired. At the reporting
date and the prior year's reporting date, we held no
treasury shares.
nearly corresponding income (Immowelt) and expenses
(Car & Boat Media) in the Classified Ad Models segment)).
The effects from the sale and disposal of real estate and
companies conducted and initiated are mainly attributa-
ble to the disposal of CarWale (Classified Ad Models), as
well as the income from the disposal of the entire Swiss
business in connection with the jointly-established Ringi-
er Axel Springer Schweiz AG (Paid Models) and the
income from the disposal of Smarthouse Media and the
disposal of the investment in Thrillist (both Marketing
Models). Furthermore, the gain on the sale of the office
building complex in Hamburg is included in the Ser-
vices/Holding segment. In the previous year, the effects
were mainly attributable to the sale of Runtastic (Paid
Models) and Talpa Germany (Marketing Models).
The reconciliation of the income from investments dis-
closed in the income statement as well as the impair-
ments are shown below:
€ millions
2016
2015
Income from investments included in
EBITDA
18.7
3.8
Non-recurring effects included in result
from investments accounted for using the
equity method
Non-recurring effects included in other
investment income
Income from investments
16.8
8.2
4.7
40.2
12.7
24.7
Depreciation, amortization, impairments,
and write-ups (except from purchase price
allocations)
Thereof write-ups
Amortization and impairments from
purchase price allocations
Depreciation, amortization, and
impairments
– 124.3
– 110.0
0.0
– 5.0
– 108.3
– 84.9
– 232.6
– 199.8
The non-current segment assets include goodwill, intan-
gible assets, property, plant, and equipment as well as
investment properties. The non-current segment assets
of the other countries are attributable to the USA in the
amount of € 733.6 million (PY: € 430.6 million).
155
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(34) 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 12/31/2016
Other non-current investments and securities
Loans and advances
Derivatives
Other non-current financial assets
Trade receivables
Receivables due from related parties
Derivatives
Other
Other assets
Cash and cash equivalents
Liabilities 12/31/2016
Financial liabilities
Trade payables
Liabilities due to related parties
Derivatives designated as a hedging instrument
Derivatives not designated as a hedging instrument
Contingent consideration
Other
Other liabilities
Assets 12/31/2015
Other non-current investments and securities
Loans and advances
Derivatives
Other non-current financial assets
Trade receivables
Receivables due from related parties
Derivatives
Other
Other assets
Cash and cash equivalents
Liabilities 12/31/2015
Financial liabilities
Trade payables
Liabilities due to related parties
Derivatives designated as a hedging instrument
Derivatives not designated as a hedging instrument
Contingent consideration
Other1)
Other liabilities
1) Prior-year figures were adjusted, see note (17).
Carrying
amount
Loans and
receiv-
ables
Financial
liabilities
Available-
for-sale
financial
assets
Financial
assets and
liabilities
held for
trading
No category
according to
IAS 39 and
non financial
assets and
liabilities
41.6
41.6
614.6
40.0
63.5
63.5
224.1
300.5
300.5
570.9
7.2
43.7
43.7
253.8
1,258.7
379.8
23.1
249.3
249.3
1,251.5
343.1
10.7
335.4
335.4
154.5
154.5
66.7
66.7
146.3
146.3
0.6
0.6
0.6
12.4
12.4
203.8
203.8
5.1
5.1
0.7
54.6
54.6
96.8
96.8
0.6
6.5
309.3
385.1
695.0
79.4
79.4
1.4
13.1
307.8
351.3
659.8
154.5
41.6
146.3
342.3
614.6
40.0
0.6
160.3
160.9
224.1
1,259.3
379.8
29.6
0.6
12.4
309.3
634.4
956.7
66.7
300.5
203.8
571.0
570.9
7.2
5.1
123.1
128.3
253.8
1,252.9
343.1
23.7
0.7
54.6
307.8
686.7
1,049.8
156
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
With the exception of the following financial assets and liabilities, the valuation is at amortized cost.
12/31/2016
12/31/2015
Fair value
based on
market price
(level 1)
Fair value
based on
observable
market data
(level 2)
Fair value not
based on
observable
input factors
(level 3)
Fair value
based on
market price
(level 1)
Fair value
based on
observable
market data
(level 2)
Fair value not
based on
observable
input factors
(level 3)
106.0
14.2
0.6
146.3
5.1
203.8
0.6
12.4
0.7
54.6
309.3
307.8
€ millions
Other non-current investments and
securities
Derivatives not designated as a
hedging instrument (positive fair
value) (see note (36b))
Derivatives designated as a hedging
instrument (negative fair value) (see
note (36a))
Derivatives not designated as a
hedging instrument (negative fair
value) (see note (36b))
Contingent consideration
Besides additions of € 77.9 million (PY: 2.1 million) other
non-current investments and securities related to positive
fair value changes of € 13.9 million (PY: € 12.1 million)
recognized directly in equity. The additions were particu-
larly attributable to the shares in Group Nine Media
which were recognized at fair value amounting to € 72.3
million at the date of acquisition, see note (7b).
In the reporting year, the fair values of liabilities for contingent considerations from business combinations developed as
follows:
€ millions
January 1
Acquisitions or granting of option rights
Payment
Subsequent valuation affecting net income
Thereof other operating income
Thereof other operating expenses
Compound
Other
December 31
2016
307.8
75.2
– 93.4
17.2
– 3.1
20.3
2.2
0.3
61.2
5.5
5.5
0.7
Thereof
Thereof
Thereof
Thereof
Immoweb Thereof Zanox
Immoweb
Thereof Zanox
Immoweb
Immoweb
Thereof Zanox
Thereof Zanox
Thereof Bonial
Thereof Bonial
Thereof Bonial
Thereof Bonial
Holding
Holding
Holding
Holding
Thereof Onet
Thereof Onet
Thereof Onet
Thereof Onet
Thereof
Thereof
Thereof
Thereof
Car&Boat
Car&Boat
Car&Boat
Car&Boat
MediaMediaMediaMedia
0.0
63.1
52.8
42.9
89.8
0.0
1.8
1.8
– 0.4
– 1.9
0.9
– 1.5
2.4
– 89.7
– 0.6
– 0.6
0.5
0.0
309.3
67.4
63.1
54.2
41.9
157
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
€ millions
January 1
Acquisitions or granting of option rights
Divestment
Payment
Subsequent valuation affecting net income
Thereof other operating income
Thereof other operating expenses
Compound
Other
December 31
Thereof
Car&Boat
Media
Thereof
Immoweb
Thereof Bonial
Holding
82.2
57.5
0.0
52.8
Thereof Onet
55.6
– 3.43
9.8
9.8
1.3
2.8
2.8
0.8
– 2.3
– 11.0
– 11.0
0.6
2015
266.4
74.2
– 0.6
– 39.2
3.1
– 16.3
19.4
3.9
0.3
307.8
89.8
61.2
52.8
42.9
The fair value measurement of the contingent purchase
price liabilities essentially depends on the estimated
results of the acquired companies in the years before the
possible exercise periods of the option rights or the
payment dates of the earn-outs. The earnings used as a
basis for measurement are generally EBITDA figures
adjusted for material non-recurring effects. In case of an
increase of the relevant estimated earnings measures by
10%, the value of the contingent consideration would
increase by approximately 11%. A decrease of the rele-
vant earnings measures by 10% would result in a reduc-
tion of approximately 5%.
With the exception of the financial liabilities presented
below, the carrying amounts of the financial assets and
liabilities were identical to their fair values.
€ millions
12/31/2016
12/31/2015
Carrying
amount Fair value
Carrying
amount Fair value
Financial liabilities
448.0
456.1
503.4
511.5
Thereof
promissory note
448.0
456.1
503.4
511.5
The fair value disclosed is determined on the basis of the
advantage between the contractually agreed fixed inter-
est rate and the market interest rate taking into account
our credit risk (level 2 of the measurement hierarchy, see
note (3g)).
The net gains and losses of financial instruments (exclud-
ing interest and income from investments) 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
2016
– 27.3
5.5
2015
3.8
14.7
15.0
– 22.1
The net gains and losses in the categories of “loans and
receivables” and “financial liabilities” consisted mainly of
the result from the currency conversion and valuation
allowances.
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 and impairments.
The net gains or losses in the category of “financial as-
sets and liabilities held for trading” mostly resulted from
changes in fair value of foreign currency derivatives and
expenses from other financial derivatives.
In the fiscal year, positive fair value changes of
€ 14.1 million (PY: € 12.4 million) before taxes were
recognized directly in equity.
158
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(35) 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.
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,
reporting requirements and business partner limit, and
prescribe the strict separation of trading and back-office
functions.
To hedge the interest rate risk, we employ in particular
interest rate derivatives such as interest rate swaps, in
addition to increased use of fixed interest agreements.
The degree of hedging specified in the Axel Springer
finance regulations ranges between 30% and 100% of
the underlying transaction volume. The use of fixed inter-
est agreements and interest rate derivatives resulted in
an annual average hedging ratio regarding the gross
indebtedness (promissory note loan and liabilities for
banks) of 39.1% (PY: 46.6%).
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 decrease by
€ 1.8 million (PY: € 3.0 million). Assuming a parallel shift
of the interest curve by - 50 basis points, the financial
result would remain unchanged (PY: improvement of less
than € 0.1 million). The financial result reacts less sensi-
tively to interest rate reductions due to variable interest
rate financial instruments with an agreed minimum inter-
est rate.
Currency risks from operations are mainly avoided
through the occurrence of operating costs 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 20% (PY: 23%).
Currency risks from foreign currency claims and liabilities
(without liabilities from contingent consideration) as well
as claims and liabilities in euros in non-euro countries
with net exposures starting at € 5 million per foreign
currency are hedged by means of maturity-congruent
forward exchange transactions.
Local-currency cash flows generated in non-euro zone
countries are either reinvested to expand local business
operations, or invested with Axel Springer SE and
hedged by means of forward exchange deals or distrib-
uted in the form of dividends. 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.
159
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(36) Financial derivatives
(a) Financial derivatives designated as hedging
instruments
In the reporting period, designated hedging instruments
were used in particular to hedge against the interest rate
risks of long-term liabilities. The cash flows were hedged
through an interest rate swap. Regarding maturity and
nominal amount the interest rate swap was chosen to
match the corresponding tranches of the variable-
interest loans (hedged items). The interest rate swap was
measured at fair value. The changes in the fair value
were recognized in accumulated other comprehensive
income until the hedged item was realized.
The fair value measurement of the interest rate swap on
the reporting date yielded negative fair values of
€ –0.6 million (PY: € –0.7 million). During the reporting
period a profit of € 0.1 million was recorded in other
comprehensive income (PY: € 0.2 million).
In addition, designated hedging instruments were used
to hedge against currency risks from purchase price
payments for company acquisitions in foreign currency.
Unrealized gains of € 4.1 million (PY: € 7.9 million) from
foreign exchange transactions and currency options
realized during the year were initially recorded in other
equity to hedge purchase price payments and were
included in acquisition costs of the acquired non-financial
assets. On the reporting date as well as in the previous
year, there were no further derivatives designated as
hedging instruments.
(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. Liquidity and
financial flexibility of the Axel Springer Group is ensured
by fixed credit lines in the amount of € 1,500.0 million
(until 2020) as well as by the promissory note
(€ 580.5 million). Note (18) contains a maturity analysis of
our financial liabilities. The payment obligations for finan-
cial obligations that have been contractually agreed but
not yet recorded are presented in note (40).
(c) Credit risk
Financial assets may be impaired if business partners do
not adhere to payment obligations. The maximum expo-
sure to risk from financial assets, which are fundamental-
ly subject to credit risk, correspond to their carrying
amounts.
Significant risk items are contained in non-current finan-
cial assets (loans) as well as in trade receivables, receiv-
ables due from related parties, and other assets.
The majority of our business models are based on a
widely distributed and heterogeneous customer base.
We therefore estimate the risk of significant defaults to
be low. To the extent that credit risks are discernible, we
reduce them using active management of receivables,
credit limits, and credit checks of our business partners.
Appropriate allowances are formed to account for dis-
cernible default risks.
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/or are classified by leading rating agencies as
being at least of Investment Grade Status BBB- (S&P) or
Baa3 (Moody’s)).
160
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(b) Financial derivatives not designated as
hedging instruments
As of December 31, 2016 forward exchange transac-
tions with a negative fair value of €–12.4 million and a
positive fair value of € 0.6 million (PY: negative fair value
of € –54.6 million, positive fair value of € 5.1 million) were
recorded; these were entered in order to secure against
currency risks in loans from foreign subsidiaries or a
contingent purchase price liability. The nominal value of
the hedged transactions on the balance sheet date
amounted to € 138.3 million (PY: € 379.6 million). The
profits and losses from the fair value measurement of
these forward exchange transactions, as well as the
opposite profits and losses from the foreign currency
measurement of the hedged loan claims and obligations
were recognized.
In order to secure our investment in Do⁄an TV, we con-
cluded several put options for a successive sale of all
shares with the seller. With regard to the accounting of
this hedging agreement as well as changes in the report-
ing year, see note (7b). From the valuation of these put
options we recognized losses of € 4.9 million (PY: gains
of € 4.4 million) in the financial result. Besides the agreed
fixed price secured by bank guarantees, the valuation of
the derivatives depends in particular on the discounting
of the future payment entitlements. A supposed variation
of the interest rate by 25 basis points would alter the
valuation within profit and loss by € 1.4 million (PY:
€ 1.9 million).
(37) Relationships with related parties
Related parties are defined as those persons and com-
panies that control the Axel Springer Group, or that are
controlled, jointly managed, or subject to significant
influence by the Axel Springer Group. Accordingly, the
members of the Springer family, the companies con-
trolled, jointly managed, or subject to significant influence
by this family, as well as companies in whose manage-
ment they hold a key position have been defined as
related parties for the Axel Springer Group. Control of the
Group is exercised by Axel Springer Gesellschaft für
Publizistik GmbH & Co. or its parent company, Friede
Springer GmbH & Co. KG, a majority of which is attribut-
able to Dr. h.c. Friede Springer. In addition, the subsidi-
aries, joint ventures, and associated companies of the
Axel Springer Group have been defined as related com-
panies. In addition to the active members of the Execu-
tive Board and Supervisory Board of Axel Springer SE
(including their family members) and their controlled or
jointly managed holdings, the institutions managing the
plan assets of the Axel Springer Group must also be
considered related parties.
161
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
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
Allowances included
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
12/31/2016
12/31/2015
2.7
40.0
6.8
18.3
15.2
29.4
2.4
2016
24.6
40.3
1.0
1.5
37.6
5.6
3.1
0.0
15.5
0.8
17.7
2.2
0.9
1.3
2.3
1.1
15.2
15.2
13.9
1.7
6.8
38.0
0.1
6.4
7.2
6.3
26.5
11.4
23.7
4.7
2015
19.6
45.3
1.0
5.3
2.7
2.6
7.7
0.0
3.3
2.7
15.4
16.3
0.9
1.0
4.5
3.7
18.9
11.4
20.5
2.0
4.3
29.0
0.1
The changes in the allowances for receivables due to
related parties are presented in the table below:
relate to outstanding receivables and liabilities in connec-
tion with the formation of the company (see note (2c)).
€ millions
Balance as of January 1
Additions
Utilization
Other changes
Balance as of December 31
2016
26.5
1.1
– 9.3
– 0.1
18.3
2015
24.1
6.0
– 3.5
0.0
26.5
The provisions referred to pension obligations owed to
members of the Executive Board. The liabilities include
obligations from the share-based compensation pro-
grams granted to the Management Board of Axel
Springer SE in the amount of € 6.5 million (PY:
€ 13.0 million).
As of December 31, 2016, receivables in the amount of
€ 2.6 million (PY: € 1.7 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 and liabilities mainly relate to the associ-
ated company Ringier Axel Springer Schweiz AG and
Goods and services provided to related parties were
mostly related to the distribution of newspapers and
magazines. The services received from related parties
mainly regarded Executive Board or Supervisory Board
services, purchased publishing products and other ser-
vices.
In mid-December 2015 we sold our shares in PRINOVIS
Ltd. & Co KG, Hamburg. In the previous year, PRINOVIS
rendered services in the amount of € 10.0 million based
on a master agreement for the printing of magazines for
companies of the Axel Springer Group.
162
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
In 2016, the fixed compensation of the members of the
Executive Board of Axel Springer SE amounted to
€ 9.1 million (PY: € 8.7 million). The variable compensa-
tion amounted to € 10.1 million (PY: € 10.2 million). The
measurement of the share-based compensation granted
to the Executive Board of Axel Springer SE resulted in
personnel expenses of € 3.5 million (PY: € 5.6 million)
and other operating income of € 3.1million (PY:
€ 0.0 million). Guaranteed pension payments to mem-
bers of the Executive Board resulted in a personnel ex-
pense of € 2.3 million (PY: € 0.8 million).
The compensation of the members of the Supervisory
Board amounted to € 3.0 million (PY: € 3.0 million). A
Supervisory Board member received compensation of
€ 0.1 million for services as an author (PY: € 0.1 million).
The compensation of the members of the Executive and
Supervisory Board is described in detail in the compen-
sation report, which is part of the notes to the consoli-
dated financial statements. The compensation report is
included in the section “Corporate Governance Report”.
An amount of € 2.7 million (PY: € 2.7 million) was paid to
former Executive Board members and former managing
directors and their survivors. A total amount of
€ 33.6 million (PY: € 34.2 million) was deferred for pen-
sion obligations.
For transactions with the institutions managing the plan
assets of the Axel Springer Group, please find the expla-
nations in note (14).
(38) Contingent liabilities
As of December 31, 2016, contingent liabilities from
guarantees existed in the amount of € 4.9 million
(PY: € 40.3 million). The guarantee granted in connection
with the sale of our print activities to FUNKE Me-
diengruppe has become obsolete due to full repayment
in the reporting period, see note (2d).
(39) Contingent assets
Contingent assets were due from KirchMedia GmbH &
Co KGaA i. L. in the amount of € 221.0 million
(PY: € 221.0 million). Insofar as advance payments are
announced in the context of the insolvency proceedings
against KirchMedia GmbH & Co. KGaA i.L., we recog-
nize them as receivables. The receivables accepted in
the table of claims by the insolvency administrator origi-
nally totaled € 325.0 million. A total of € 3.3 million (PY:
€ 29.3 million) was paid out in the reporting year.
(40) Other financial commitments
The other financial commitments broke down as follows:
€ millions
12/31/2016 12/31/2015
Purchase commitments for
- intangible assets
- property, plant, and equipment
- inventories
0.8
228.7
22.9
1.2
25.4
24.9
Future payments under operating leases
198.5
202.1
Future payments under finance leases
Long-term purchase obligations
0.7
59.9
1.5
53.9
Other financial obligations
511.5
309.0
163
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
In 2016, the construction of the new Axel Springer
headquarter building was started in direct vicinity of the
old headquarter building in Berlin. From 2020 on up to
3,500 employees will be working on about 52,000 m2.
Total construction budget will be approximately € 300
million. As of the balance sheet date, investments
amounted to € 42 million (see note (5)). The purchase
commitments for property, plant, and equipment largely
result from this new construction project.
Long-term purchase obligations resulted primarily from
contracts for TV productions.
The future minimum lease payments from operating
leases on December 31, 2016 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
2016
58.5
118.9
21.1
198.5
2015
55.0
117.9
29.2
202.1
(41) Events after the reporting date
At the beginning of January 2017, the acquisition of 100%
of the shares in ShareASale.com Inc., Chicago, USA,
was completed (for further information, see note (2c)).
There are no further significant events after the reporting
date to be reported.
(42) Declaration of Conformity with the German
Corporate Governance Code
Axel Springer SE published the Declaration of Conformity
with the German Corporate Governance Code issued by
the Management Board and Supervisory Board in ac-
cordance with Section 161 of the German Stock Corpo-
rations Act (AktG) on the company’s website
www.axelspringer.de (cid:279) Investor Relations (cid:279) 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.
164
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
(43) Companies included in the consolidated financial statements and share property
No. Company
1
Axel Springer SE, Berlin
12/31/2016
12/31/2015
Share-
holding
in %
Share-
holding
in %
via No.
via No.
-
-
-
-
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
Fully consolidated subsidiaries
Germany
AS Osteuropa GmbH, Berlin
AS TV-Produktions- und Vertriebsges. mbH, Hamburg
Axel Springer All Media GmbH & Co. KG, Berlin
Axel Springer Asia GmbH, Hamburg
Axel Springer Auto-Verlag GmbH, Hamburg
Axel Springer Auto-Verlag GmbH (previously Axel Springer Auto & Motorsport Verlag GmbH), Hamburg
Axel Springer Digital Classifieds GmbH, Berlin
Axel Springer Digital Classifieds Holding GmbH, Berlin
Axel Springer Digital GmbH, Berlin
Axel Springer Digital Ventures GmbH, Berlin
Axel Springer Digital Ventures US GmbH (previously Zweiundneunzigste "Media"
Vermögensverwaltungsges. mbH), Berlin
Axel Springer Druckhaus Spandau GmbH & Co. KG, Berlin
Axel Springer Financial Media GmbH, Munich
Axel Springer ideAS Engineering GmbH, Berlin
Axel Springer ideAS Ventures GmbH, Berlin
Axel Springer International GmbH, Berlin
Axel Springer International Holding GmbH, Berlin
Axel Springer Kundenservice GmbH, Hamburg
Axel Springer Media Logistik GmbH, Berlin
Axel Springer Mediahouse Berlin GmbH, Berlin
Axel Springer Medien Accounting Service GmbH, Berlin
Axel Springer Offsetdruckerei Ahrensburg GmbH & Co. KG, Ahrensburg
Axel Springer Offsetdruckerei Kettwig GmbH & Co. KG, Essen
Axel Springer Personalservice GmbH, Berlin
Axel Springer Services & Immobilien GmbH, Berlin
Axel Springer Sport Dienstleistungs-GmbH (previously Dreiundachtzigste "Media"
Vermögensverwaltungsges. mbH), Hamburg
Axel Springer Sport Verlag GmbH, Hamburg
Axel Springer Syndication GmbH, Berlin
Axel Springer TV Productions GmbH, Hamburg
"Axel Springer Verlag" Beteiligungsgesellschaft mbH, Berlin
Axel Springer Vertriebsservice GmbH, Hamburg
B.Z. Ullstein GmbH, Berlin
Bilanz Deutschland Wirtschaftsmagazin GmbH, Hamburg
BILD GmbH & Co. KG, Berlin
Bonial Enterprises GmbH & Co. KG, Berlin
Bonial Holding GmbH, Berlin
Bonial International GmbH, Berlin
Bonial Management GmbH, Berlin
Buch- und Presse-Großvertrieb Hamburg GmbH & Co. KG, Hamburg
Buzz Technologies GmbH (previously Vierundsiebzigste "Media" Vermögensverwaltungsges. mbH), Berlin
Casamundo GmbH, Hamburg
165
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
100.0
100.0
100.0
100.0
100.0
100.0
100.0
-
100.0
100.0
100.0
-
72.5
100.0
100.0
77.1
51.0
100.0
18
1
1
18
-
1
10
8
1
10
11
1
-
31
31
1
17
1
-
1
1
1
1
1
1
28
1
31
1
1
-
31
31
1
-
10
37
37
1
1
90
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
100.0
-
100.0
-
-
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
72.5
100.0
100.0
78.1
-
100.0
6)
5)
5)
5)
5)
5)
6)
5)
5)
5)
5)
5)
5)
5)
6)
6)
5)
5)
5)
5)
5)
5)
5)
5)
6)
9)
6)
18
1
1
18
1
-
10
8
1
10
-
1
1
31
31
1
17
1
1
1
1
1
1
-
1
-
-
31
1
1
1
31
31
1
37
10
37
37
1
-
90
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
No. Company
12/31/2016
12/31/2015
Share-
holding
in %
Share-
holding
in %
via No.
via No.
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
Commerz-Film GmbH, Berlin
comparado GmbH, Lüneburg
COMPUTER BILD Digital GmbH, Hamburg
COMPUTER BILD Digital GmbH (previously Axel Springer Computer Verlag GmbH), Hamburg
Content Factory TV-Produktion GmbH, Berlin
DanCenter GmbH, Hamburg
eprofessional GmbH, Hamburg
finanzen.net GmbH, Karlsruhe
Gofeminin.de GmbH, Cologne
hamburg.de GmbH & Co. KG, Hamburg
Idealo International GmbH, Berlin
Idealo Internet GmbH, Berlin
Immonet GmbH, Hamburg
ImmoSolve GmbH, Bad Bramstedt
Immowelt AG, Nuremberg
Immowelt Holding AG, Nuremberg
infoRoad GmbH, Heroldsberg
Maz&More TV-Produktion GmbH, Berlin
Media Impact GmbH & Co. KG, Berlin
meinestadt.de GmbH, Cologne
meinestadt.de Holding GmbH, Berlin
meinestadt.de Vertriebs-GmbH, Cologne
MeinProspekt GmbH, Munich
Newspaper Impact GmbH (previously Neunundsiebzigste "Media" Vermögensverwaltungsges. mbH),
Hamburg
PACE Paparazzi Catering & Event GmbH, Berlin
Panther Holding GmbH, Berlin
Room 49 GmbH, Berlin
Sales Impact GmbH & Co. KG, Hamburg
Smarthouse Media GmbH, Karlsruhe
StepStone Continental Europe GmbH (previously Vierundachtzigste "Media" Vermögensverwaltungsges.
mbH), Berlin
StepStone Deutschland GmbH, Düsseldorf
StepStone GmbH, Berlin
Transfermarkt GmbH & Co. KG, Hamburg
Traum-Ferienwohnungen GmbH, Bremen
Ullstein Ges. mit beschränkter Haftung, Berlin
Umzugsauktion GmbH & Co. KG, Schallstadt
upday GmbH & Co. KG, Berlin
upday Holding GmbH, Berlin
Vertical Media GmbH, Berlin
Visoon Video Impact GmbH & Co. KG (previously thads.media vermarktungs GmbH & Co. KG), Berlin
Visual Meta GmbH, Berlin
WeltN24 GmbH, Berlin
YOURCAREERGROUP GmbH, Düsseldorf
ZANOX AG, Berlin
Zuio GmbH, Berlin
Other countries
100.0
100.0
-
100.0
100.0
100.0
100.0
75.0
100.0
61.9
100.0
74.9
100.0
51.0
100.0
55.0
60.4
100.0
74.9
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
-
100.0
100.0
100.0
51.0
50.01
100.0
100.0
100.0
100.0
88.0
51.0
75.6
100.0
100.0
52.5
-
18
54
-
1
84
122
86
11
96
10
54
10
58
55
58
9
7
84
4
63
9
62
38
1
1
54
16
1
-
74
74
9
35
88
31
55
1
79
84
4
54
1
74
10
-
100.0
100.0
100.0
-
100.0
-
100.0
75.0
100.0
61.9
100.0
74.9
100.0
51.0
100.0
55.0
-
100.0
74.9
100.0
100.0
100.0
100.0
-
100.0
100.0
100.0
100.0
91.0
-
100.0
100.0
51.0
-
100.0
100.0
100.0
100.0
88.0
100.0
75.6
100.0
100.0
52.5
100.0
88
@Leisure BR B.V., Eindhoven, Netherlands
100.0
89
100.0
166
5)
5)
10)
6)
9)
9)
5)
6)
5)
5)
5)
6)
5)
5)
5)
6)
5)
6)
6)
9)
6)
5)
5)
9)
18
54
1
-
84
-
86
11
96
10
54
10
58
55
58
9
-
84
1
63
9
62
38
-
1
54
16
1
11
-
74
9
35
-
31
55
1
79
84
4
54
1
74
10
31
89
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
No. Company
89
90
91
92
93
@Leisure Holding B.V., Rotterdam, Netherlands
@Leisure NH B.V., Amsterdam, Netherlands
AanZee VillaXL B.V. (previously Villa XL B.V.), Bergen, Netherlands
Administrationsselskabet af 1.10.2015 ApS, Copenhagen, Denmark
alFemminile s.r.l., Milan, Italy
94
APM Print d.o.o., Belgrade, Serbia
95
96
97
98
99
AS-NYOMDA Kft, Kecskemét, Hungary
AUFEMININ SA, Paris, France
auFeminin.com Productions SARL, Paris, France
Automotive Exchange Private Limited, Mumbai, India
Axel Springer Beteiligungen Switzerland AG, Zurich, Switzerland
100
Axel Springer Digital Classifieds France SAS, Paris, France
101
Axel Springer España S.A., Madrid, Spain
102
Axel Springer France S.A.S., Paris, France
103
Axel Springer IdeAS Polska Sp. z o. o., Breslau, Poland
104
Axel Springer International AG, Zurich, Switzerland
105
Axel Springer International Limited, London, Great Britain
106
Axel Springer Norway AS, Oslo, Norway
107
Axel Springer Switzerland AG, Zurich, Switzerland
108
Azet.sk a.s., Zilina, Slovakia
109
Belles Demeures S.A.S., Paris, France
110
Belvilla Ferienwohnungen GmbH, Kitzbühel, Austria
111
Blikk Kft., Budapest, Hungary
112
Bonial Enterprises North America Inc., New York, USA
113
Bonial SAS, Paris, France
114
Business Insider Europe Limited, London, Great Britain
115
Business Insider Inc., New York City, USA
116
Candidate Manager (US) Inc, Boston, USA
117
Candidate Manager Ltd, Dublin, Ireland
118 Car&Boat Media SAS, Paris, France
119
CaribbeanJobs Ltd, George Town, Cayman Islands
120
Coral-Tell Ltd., Tel Aviv, Israel
121
Cybersearch S.A., Guatemala City, Guatemala
122
DanCenter A/S, Copenhagen, Denmark
123
DanCenter EDB Service ApS, Copenhagen, Denmark
124
Digital Window Inc., Wilmington, USA
125
Digital Window Limited, London, Great Britain
126
DreamLab Sp. z.o.o. (previously DreamLab Onet.pl sp. z o.o.), Krakow, Poland
127
eMarketer Europe Ltd., London, Great Britain
128
eMarketer Inc., New York, USA
129
ENFEMENINO AUFEMININ S.A. (previously enFemenino SARL), Madrid, Spain
130
Estascontratadocom S.A., Panama City, Panama
131
Etoilecasting.com SAS, Paris, France
132
Gambettes Box SAS, Paris, France
133
Garantie System SAS, Paris, France
167
12/31/2016
12/31/2015
Share-
holding
in %
51.0
-
100.0
100.0
100.0
100.0
100.0
78.4
100.0
-
100.0
100.0
100.0
100.0
-
100.0
100.0
100.0
100.0
-
100.0
50.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
61.0
39.0
100.0
100.0
100.0
0.0
100.0
100.0
100.0
100.0
100.0
100.0
93.4
100.0
100.0
100.0
100.0
100.0
Share-
holding
in %
via No.
via No.
9
-
89
142
96
172
174
18
96
-
107
9
1
1
-
105
18
105
1
-
169
88
176
36
38
115
11
117
180
9
100
180
9
194
180
142
122
125
86
163
128
11
96
194
96
152
118
51.0
100.0
100.0
-
100.0
74.9
25.1
100.0
79.5
100.0
90.3
-
100.0
100.0
100.0
99.0
1.0
100.0
100.0
100.0
100.0
80.0
100.0
50.0
100.0
100.0
100.0
100.0
96.5
100.0
100.0
51.0
-
100.0
100.0
-
-
-
-
100.0
100.0
100.0
-
-
100.0
-
100.0
100.0
100.0
10
89
89
-
96
199
172
174
18
96
5
-
9
1
1
15
1
105
18
105
1
178
169
88
11)
176
36
38
115
11
117
180
9)
9
-
180
7)
9)
9
-
-
-
-
125
86
163
-
-
96
-
96
152
118
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
No. Company
134
GoBrands Sp. z o.o., Krakow, Poland
135
Good & Co Labs, Inc., San Francisco, USA
136
ictjob SPRL, Waterloo, Belgium
137
Immoweb SA, Brussels, Belgium
138
Interactive Junction Holdings Proprietary Limited, Rosebank/Johannesburg, South Africa
139
Jobs LU Ltd, Dublin, Ireland
140
Jobs.ie Ltd, Dublin, Ireland
141
Jobsite UK (Worldwide) Limited, London, Great Britain
142
Land & Leisure A/S, Kopenhagen, Denmark
143
Les Rencontres aufeminin.com SAS, Paris, France
144
Livingly Media, Inc., San Carlos, USA
145 Marmiton SAS, Paris, France
146 Maritimo 101 SL, Malaga, Spain
147 Media Impact Polska Sp. z o.o., Warsaw, Poland
148 Merci Alfred S.A.S., Paris, France
149 Milkround Online Ltd., London, Great Britain
150 My Little Box KK, Tokyo, Japan
151 My Little Campus SAS, Paris, France
152 My Little Paris S.A.S., Paris, France
153 My Web Ltd, Ebene, Mauritius
154 MyJob Group Ltd, Sheffield, Great Britain
155
NARKS INFOSERVIS, a.s., Bratislava, Slovakia
156
Netmums Limited, London, Great Britain
157
New Digital d.o.o. Belgradee, Belgrade, Serbia
158
NIJobs.com Ltd, Belfast, Ireland
159
NIN d.o.o., Belgrade, Serbia
160
ofeminin.pl Sp. z o.o., Warsaw, Poland
161
OFERTIAMX RETAIL SERVICES, S. de R.L. de C.V., Mexico City, Mexico
162
ONET Holding Sp. z o.o., Warsaw, Poland
163
Onet S.A. (previously Grupa Onet.pl SA), Krakow, Poland
164
OnetMarketing Sp. z o.o., Krakow, Poland
165
Opineo Sp. z o.o., Wroclaw, Poland
166
Pnet (Pty) Ltd, Johannesburg, South Africa
167
Poliris S.A.S., Paris, France
168
Praxis SARL, Chambery, France
169
PressImmo On Line S.A.S., Paris, France
170
profession.hu Kft, Budapest, Hungary
171
Residence de Monbrison A/S, Kopenhagen, Denmark
172
Ringier Axel Springer d.o.o., Belgrade, Serbia
173
Ringier Axel Springer Inwestycje Sp. z o.o., Warsaw, Poland
174
Ringier Axel Springer Magyarország Kft, Budapest, Hungary
175
Ringier Axel Springer Management AG, Zurich, Switzerland
176
Ringier Axel Springer Media AG, Zurich, Switzerland
177
Ringier Axel Springer Polska Sp. z o.o., Warsaw, Poland
178
Ringier Axel Springer Slovakia a.s., Bratislava, Slovakia
168
12/31/2016
12/31/2015
Share-
holding
in %
via No.
100.0
100.0
99.0
1.0
80.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
50.0
50.0
100.0
100.0
100.0
100.0
70.0
100.0
100.0
100.0
100.0
100.0
100.0
99.7
51.0
49.0
100.0
75.0
100.0
100.0
100.0
100.0
-
100.0
100.0
100.0
73.2
100.0
99.0
100.0
-
50.0
100.0
89.0
163
74
74
189
100
180
180
180
192
89
96
96
96
142
163
177
96
198
152
152
96
166
141
201
96
172
180
172
96
177
186
176
162
163
162
180
-
169
183
176
142
176
177
176
-
105
176
176
Share-
holding
in %
100.0
-
99.0
1.0
80.0
100.0
100.0
100.0
100.0
-
-
100.0
100.0
-
50.0
50.0
100.0
-
100.0
100.0
70.0
100.0
100.0
100.0
100.0
100.0
100.0
99.7
51.0
49.0
-
75.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
-
100.0
99.0
98.2
100.0
50.0
100.0
100.0
via No.
163
-
74
189
100
9)
180
180
180
192
-
-
96
96
-
163
177
96
-
152
152
96
9)
166
141
201
96
172
180
172
96
177
-
176
9)
162
163
162
180
183
169
183
176
-
176
177
176
176
105
3)
176
176
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
12/31/2016
12/31/2015
Share-
holding
in %
Share-
holding
in %
via No.
70.0
100.0
100.0
100.0
97.7
2.3
100.0
100.0
63.6
66.7
100.0
100.0
0.0
100.0
100.0
100.0
100.0
0.0
100.0
99.6
0.4
95.0
3.0
2.0
100.0
100.0
-
100.0
60.0
100.0
100.0
100.0
-
65.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
0.0
100.0
120
192
169
183
100
9
162
96
38
178
74
74
190
73
74
74
194
180
180
194
180
194
193
121
89
192
-
89
108
80
80
80
-
183
74
86
86
86
86
86
86
86
49
86
70.0
100.0
-
100.0
97.7
1.9
100.0
100.0
63.6
-
100.0
100.0
0.0
100.0
100.0
100.0
-
-
-
-
-
-
-
-
100.0
100.0
100.0
100.0
60.0
-
100.0
-
100.0
65.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
0.0
100.0
via No.
120
9)
192
12)
-
183
100
9
162
96
38
-
74
74
9)
190
7)
73
74
74
-
-
-
-
-
-
-
-
89
192
172
89
108
-
80
-
177
183
74
86
86
86
86
86
86
86
49
86
7)
7)
No. Company
179
Saknai Net Ltd., Tel Aviv, Israel
180
Saongroup Limited, Dublin, Ireland
181
SeLoger Finances S.A.S., Paris, France
182
Seloger Solutions SAS, Paris, France
183
SeLoger.com SAS, Paris, France
184
Skapiec Sp. z o.o., Wroclaw, Poland
185
soFeminine.co.uk Limited, London, Great Britain
186
SOKOWEB TECHNOLOGIES, S.L., Barcelona, Spain
187
SPORT.SK s.r.o., Zilina, Slovakia
188
StepStone France SAS, Paris, France
189
StepStone NV, Brussels, Belgium
190
StepStone Austria GmbH, Vienna, Austria
191
StepStone Services Sp. z o.o., Warsaw, Poland
192
StepStone UK Holding Limited, London, Great Britain
193
Tecoloco El Salvador S.A. de C.V., San Salvador, El Salvador
194
Tecoloco International Inc, Panama City, Panama
195
Tecoloco S.A. de C.V. Honduras, Tegucigalpa, Honduras
196
Tecoloco.com S.A. de C.V. Nicaragua, Managua, Nicaragua
197
Topic Travel B.V., The Hague, Netherlands
198
Totaljobs Group Limited, London, Great Britain
199
Trans Press d.o.o., Belgrade, Serbia
200
Traveezee Insurance N. V., Eindhoven, Netherlands
201
United Classifieds s.r.o., Bratislava, Slovakia
202
upday France SARL, Paris, France
203
upday Polska Sp. z o.o. Sp.k., Warsaw, Poland
204
upday UK Ltd., London, Great Britain
205
Viviana Investments Sp. z o.o., Warsaw, Poland
206 WEBIMM SAS, Paris, France
207
YOURCAREERGROUP Switzerland GmbH, Kloten, Switzerland
208
zanox B.V., Amsterdam, Netherlands
209
ZANOX Hispania SL, Madrid, Spain
210
zanox SAS, Paris, France
211
zanox Switzerland AG, Zurich, Switzerland
212
zanox Sp. z o.o., Warsaw, Poland
213
zanox SRL, Milan, Italy
214
ZANOX VEICULAÇÃO DE PUBLICIDADE NA INTERNET LTDA., São Paulo, Brazil
215
zanox we create partners AB, Stockholm, Sweden
169
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
12/31/2016
Share
hol-
ding
in %
via
No.
No. Company
12/31/2016
Share
hol-
ding
in %
via
No.
No. Company
Other subsidiaries1)
Germany
216 @Leisure Deutschland GmbH i.L., Hamburg
100.0
88
217
Achtundachtzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
100.0
1
218
Achtundneunzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
100.0
31
251
Sechsundsiebzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
100.0
31
252 Shop Now GmbH i.L., Berlin
90.0
16
253
Siebenundachtzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
100.0
1
254
Siebenundneunzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
100.0
31
100.0
1
100.0
31
100.0
100.0
1
1
100.0
15
100.0
100.0
1
1
100.0
11
100.0
1
100.0
81
255 Tarif24 GmbH, Berlin
256 TOPS Online Publications GbR, Lüneburg
257 TraderFox GmbH, Reutlingen
258 Transfermarkt Verwaltungs GmbH, Hamburg
259 TunedIn Media GmbH i.L., Berlin
260 Umzugsauktion Verwaltungs GmbH, Schallstadt
261 upday Management GmbH, Berlin
262
Vierundneunzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
263
Visoon Video Impact Management GmbH (vormals Neunzigste
"Media" Vermögensverwaltungsgesellschaft mbH), Berlin
52.9
4
264 Zuio GmbH, Berlin
100.0
57
100.0
1
265
Zweiundachtzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
266
Zweiundsechzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
Other countries
267 African Jobs Online Ltd, Port Louis, Mauritius
268 Alpha Real spol. s.r.o., Zilina, Slovakia
269 AUTOVIA, s.r.o., Bratislava, Slovakia
270 Axel Springer Hírszolgálat Kft, Tatabánya, Hungary
219
Achtundsiebzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
220 AS Buchversand GmbH, Munich
221 Axel Springer All Media Verwaltungs-GmbH, Berlin
222 Axel Springer Financial Media GmbH, Munich
223 Axel Springer Liveware IT GmbH, Berlin
224 Axel Springer Print Management GmbH, Berlin
225 Axel Springer Security GmbH, Berlin
226 Axel Springer Transformator Holding GmbH, Berlin
227 BILD Multimedia Verwaltungs GmbH, Berlin
228 CEO Event GmbH, Berlin
229 Contact Impact GmbH, Hamburg
230 Dreamlabs GmbH i.L., Berlin
231
Dreiundneunzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
232 Dreizehnte "Media" Vermögensverwaltungsges. mbH, Hamburg
100.0
1
233
Einundneunzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
100.0
1
234 Finanzen Corporate Publishing GmbH, Berlin
100.0
1
235
Fünfundachtzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
236
Fünfundneunzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
100.0
100.0
1
1
237
Fünfundsiebzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
100.0
31
238 hamburg.de Beteiligungs GmbH, Hamburg
100.0
52
239
Hammerich & Lesser Zeitschriften- und Buchverlag GmbH,
Hamburg
100.0
1
240 Hauptstadtsee 809. VV GmbH, Berlin
241
Informationsmedien Handels GmbH, Hamburg
242 kinkaa GbR, Berlin
243 Media Impact Management GmbH, Berlin
100.0
100.0
50.0
50.0
74.9
1
1
54
68
4
271 Axel Springer International Group Limited, London, Great Britain
100.0
272 Axel Springer Media France S.A.R.L., Neuilly-sur-Seine, France
100.0
273 Axel Springer Media Italia s.r.l., Milan, Italy
100.0
1
61
61
274
Axel Springer Publishing International Limited, London, Great
Britain
100.0
271
275
Axel Springer Services Inc. (previously Axel Springer Digital
Ventures Inc.), Wilmington, USA
100.0
11
276 Axel Springer TV International Limited, London, Great Britain
100.0
271
277 Azet.sk – katalóg s.r.o., Zilina, Slovakia
278 BEMFEMININO.COM.BR, Sao Paulo, Brazil
244 meinestadt.de Vermögensverwaltungsgesellschaft mbH,
100.0
62
279 BILD Inc., City of Wilmington, USA
Cologne
245 myPass GmbH, Berlin
100.0
1
246
Neunundachtzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
100.0
1
280 Car Price List Yad2 Ltd., Tel Aviv, Israel
281 City-Nav Sp. z o.o., Poznań, Poland
282 CompuTel Telefonservice AG, Chur, Switzerland
247 Sales Impact Management GmbH, Hamburg
248 Scubia GbR, Berlin
100.0
50.0
50.0
1
68
54
283 Cpress Media s.r.o., Zilina, Slovakia
284 Digitalni klik d.o.o., Zagreb, Croatia
285 ETSBA Ltd., Tel Aviv, Israel
249
Sechsundachtzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
100.0
1
250
Sechsundneunzigste "Media" Vermögensverwaltungsges. mbH,
Berlin
100.0
31
286 Euro Blic Press d.o.o., Banja Luka, Bosnia-Herzegovina
100.0
172
287 eurobridge Inc., New York, USA
100.0
1
288
Gemini Moon Trading 343 Proprietary Limited, Cap Town, South
Africa
100.0
139
289
Immostreet ES, Barcelona, Spain
100.0
169
170
100.0
90.0
10.0
50.1
51.0
86.4
54
44
54
50
35
1
100.0
55
100.0
1
100.0
51.0
1
4
100.0
31
100.0
100.0
1
1
100.0
180
100.0
178
100.0
201
100.0
174
100.0
178
99.9
0.1
100.0
96
97
35
100.0
120
69.3
163
100.0
107
100.0
178
60.0
57
100.0
120
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
No. Company
12/31/2016
Share
hol-
ding
in %
via
No.
No. Company
12/31/2016
Share
hol-
ding
in %
via
No.
290 Jean Frey AG, Zurich, Switzerland
100.0
107
315 Berliner Pool TV Produktion Gesellschaft mbH, Berlin
50.0
84
291 Jobcity Ltd., Tel Aviv, Israel
292
Media Impact Inc. (previously Axel Springer Group Inc.) , New
York, USA
100.0
120
100.0
61
316
Blitz-Tip Radio Hessen Beteiligungsges. mbH & Co. KG, Bad
Soden am Taunus
33.3
1
317 Dropspot GmbH i.L., Berlin
293 Realty Media House s.r.o., Bratislava, Slovakia
100.0
156
318 Filmgarten GmbH, Berlin
319
Ges. für integr. Kommunikationsforschung mbH & Co. KG,
München
320
Ges. für integr. Kommunikationsforschung Verwaltungs GmbH,
Munich
321 hy! GmbH, Berlin
322
Intermedia Standard Presse-Code GmbH, Hamburg
323
InterRed GmbH, Haiger
324
ISPC Intermedia Standard Presse-Code GmbH & Co.KG,
Hamburg
325 LAUT AG, Konstanz
326 Marina Wendtorf Invest II GmbH & Co. KG, Kiel
327 Mont Ventoux Media GmbH, Berlin
328 Project A Management GmbH, Berlin
329 Project A Services GmbH & Co. KG, Berlin
330 Qivive GmbH i. L., Bad Homburg
331 Radio Hamburg GmbH & Co. KG, Hamburg
332 Sparheld International GmbH, Berlin
40.0
42.0
20.0
20.0
49.0
32.0
24.0
1
54
1
1
1
1
1
32.0
1
25.0
1
49.0
143
50.0
26.3
37.5
33.3
35.0
30.0
30
10
10
1
1
54
333
V.V. Vertriebs-Vereinigung Berliner Zeitungs- und Zeitschriften-
Grossisten GmbH & Co. KG, Berlin
48.5
1
334 Zeitungs- und Zeitschriften Vertrieb Berlin GmbH, Berlin
35.5
1
Other countries
335 Asocijacija Privatnih Media, Belgrade, Serbia
336 BULGARPRESS OOD, Veliko Tarnovo, Bulgaria
337 EMAS Digital SAS, Montrouge Cedex, France
20.0
172
25.5
1
50.0
102
338 HUNGAROPRESS Sajtóterjesztö Kft, Budapest, Hungary
24.0
1
339 SereniPay SAS, Paris, France
340 VINA WOMAN UK LTD., London, Great Britain
19.4
118
30.0
96
294 Saongroup Caribbean (Jamaica) Ltd, Kingston, Jamaica
100.0
119
295
Saongroup Caribbean (Trinidad) Ltd, Port of Spain, Trinidad and
Tobago
100.0
119
296 Saongroup.com India Pvt Ltd, Pune, India
297 Tecoloco Holding S.A. de C.V., San Salvador, El Salvador
100.0
180
100.0
194
0.0
180 7)
298 Tecoloco.com S.A. de C.V. Panama, Panama City, Panama
100.0
194
299 upday Polska Sp. z o.o., Warsaw, Poland
300 wewomen.com Inc., Wilmington, USA
301 Yad2Pay Internet Ads Ltd., Haifa, Israel
302 Yad2Pay Ltd., Tel Aviv, Israel
Investments accounted for using the equity method
Germany
303 AS TYFP Media GmbH & Co. KG, Berlin
304 Axel Springer Plug and Play Accelerator GmbH, Berlin
305 Bonial Ventures GmbH, Berlin
306 mytic myticket AG, Frankfurt am Main
307 Project A Ventures GmbH & Co. KG, Berlin
Other countries
308 AC3 SAS, Guipavas, France
309 Blendle B.V., Utrecht, Netherlands
310
Editions Mondadori Axel Springer (EMAS) S.E.N.C., Montrouge
Cedex, France
311
INFOR BIZNES Sp. z o.o., Warsaw, Poland
312 Ozy Media, Inc., Mountain View CA, USA
313 Ringier Axel Springer Switzerland AG, Zurich, Switzerland
Other associated companies and joint ventures2)
Germany
100.0
100.0
80
96
100.0
120
100.0
120
50.0
50.0
74.9
20.0
26.3
1
11
1 4)
1
10
40.0
21.0
183
11
50.0
102
49.0
16.8
50.0
173
11 8)
99
314 Agenda Media GmbH i.L., Berlin
49.0
84
171
Annual Report 2016
Axel Springer SE
Consolidated Financial Statements
Notes to the Consolidated Financial Statements
No. Company
Other significant investments
Germany
341 ANTENNE BAYERN GmbH & Co. KG, Ismaning
342 RADIO/TELE FFH GmbH & Co. Betriebs-KG, Bad Vilbel
Other countries
343 Airbnb, Inc., San Francisco, USA
344 Doğan TV Holding A.S., Istanbul, Turkey
345 Group Nine Media, Inc., New York, USA
346 Lakestar II LP, Guernsey, Guernsey
347 QWANT SAS, Paris, France
12/31/2016
Shareholding
in %
via
No.
Equity
Mio. € 13)
Net income
Mio. € 13)
16.0
15.0
0.1
7.0
13.0
6.6
19.0
1
1
1
43
11
11
11
-
-
-
413.5
-
69.3
3.4
- 15)
- 15)
- 15)
– 46.3
- 14)
– 4.3
– 4.1
1) No full consolidation due to immaterial impact (relation of net income and balance sheet total
for the company to net income and balance sheet total of the Group).
8) Significant influence on the basis of contractual agreements.
9) Due to option rights in the reporting year and/or in the prior year a share
2) No at-equity consolidation due to immaterial impact (relation of net income of th company to
of 100 % consolidated.
net income of the Group).
3) Control due to existing option rights exercisable at any time.
4) In the reporting year and/or the previous year, no control due to the lack of contractual
agreements, which exclude the power of control and the possiblility to influence the variable
outflaws.
5) The company has exercised the exemption rights of Section 264 (3) of the German Commer-
cial Code (Handelsgesetzbuch - HGB).
6) The company has exercised the exemption rights of Section 264b of the German Commercial
Code (Handelsgesetzbuch – HGB).
7) Shares less than 0.1%.
10) Due to option rights in the reporting year and in the prior year a share
of 89.99 % consolidated.
11) Control due to contractual agreements and rights to obtain power.
12) Applying rules of Section 357(1) of the Companies Act 2014.
13) Unless otherwise stated, equity and profit for the year according to local annual financial
statements for the financial year 2015. Values translated into foreign currency using the
closing rate as at December 31, 2016.
14) The company was founded in the year under review. There is no financial statement yet.
15) No statement of equity and profit for the year as the annual financial statements are not
published.
172
Boards
Supervisory Board
The Supervisory Board is composed of the following persons:
Name, occupation
Seats on other mandatory
supervisory boards
Seats on comparable boards
in Germany and abroad
Dr. Giuseppe Vita
Chairman of the Supervisory Board of
Axel Springer SE
Dr. h. c. Friede Springer
Vice Chairwoman of the Supervisory Board
of Axel Springer SE
ALBA Finance plc & Co. KGaA
(until December 2016)
ALBA plc & Co. KGaA
(until December 2016)
UniCredit S.p.A., Italy (Chairman of the Board of Directors)
ALBA Group plc & Co. KG (Advisory Board until December 2016)
William E. Ford (since August 29, 2016)
CEO General Atlantic
Oliver Heine
Attorney at law and partner in the
law firm Heine & Partner
Rudolf Knepper
Entrepreneur
Lothar Lanz
Member of various Supervisory Boards
IHS Markit Ltd., United Kingdom (Board of Directors)
Oak Hill Advisors, L.P., USA (Partnership Committee)
TBG AG, Switzerland (Board of Directors)
Tory Burch LLC, USA (Board of Directors)
YooApplications AG, Switzerland (Board of Directors)
Bauwert AG (Chairman)
Home24 AG (Chairmen)
TAG Immobilien AG (Vice Chairman)
Zalando SE (Chairman since May 2016,
before member of the Supervisory Board)
Do⁄an TV Holding A.S., Turkey (Supervisory Board)
Kinnevik AB, Sweden (Board of Directors, since May 2016)
Dr. Nicola Leibinger-Kammüller
President and Chairwoman of the Managing
Board of TRUMPF GmbH + Co. KG
Lufthansa AG (until April 2016)
Siemens AG
Voith GmbH
Prof. Dr.-Ing. Wolfgang Reitzle
Entrepreneur
Continental AG (Chairman)
Hawesko Holding AG (Vice Chairman)
Linde AG (Chairman, since May 2016)
Medical Park AG (Chairman)
Ivoclar Vivadent AG, Liechtenstein (Board of Directors)
LafargeHolcim Ltd., Switzerland
(Chairman of the Board of Directors, until May 2016)
Martin Varsavsky
CEO Prelude Fertility Inc.
Prof. Dr. Wolf Lepenies
(until July 31, 2016)
University Professor (emer.) FU Berlin;
Permanent Fellow (emer.) at
Wissenschaftskolleg zu Berlin
Fon Wireless Limited, United Kingdom (Chairman of the Board of Directors)
173
Annual Report 2016
Axel Springer SE
Executive Board
Boards
The Executive Board is composed of the following persons:
Executive Board member
Seats on mandatory
supervisory boards
Seats on comparable boards
in Germany and abroad
Dr. Mathias Döpfner
Chairman and Chief Executive Officer
Journalist
Jan Bayer
President Paid Models
Media scholar
Dr. Julian Deutz
Chief Financial Officer
Master’s Degree in Business Administration
Immowelt AG (Supervisory Board from
June 2016 until December 2016)
Immowelt Holding AG (Supervisory Board,
from June 2016 until December 2016)
Dr. Andreas Wiele
President Marketing and Classified Ad
Models
Immowelt AG (Chairman)
Immowelt Holding AG (Chairman)
ZANOX AG (Chairman)
Lawyer
Axel Springer Schweiz AG, Switzerland (Chairman of the Board of Directors)
Business Insider Inc., USA (Chairman of the Board of Directors)
eMarketer Inc., USA (Board of Directors since July 2016)
Ringier Axel Springer Schweiz AG, Switzerland (Board of Directors)
Time Warner Inc., USA (Board of Directors)
Vodafone Group Plc., Great Britain (Board of Directors)
Warner Music Group Corp., USA (Board of Directors)
Business Insider Inc., USA (Board of Directors)
eMarketer Inc., USA (Board of Directors since July 2016)
Media Impact GmbH & Co. KG (Advisory Board)
Ringier Axel Springer Media AG, Switzerland
(Board of Directors since June 2016)
Axel Springer Digital Classifieds GmbH (Supervisory Board until February 2016)
Axel Springer International AG, Switzerland (Board of Directors)
Axel Springer Schweiz AG, Switzerland (Board of Directors)
ITAS Media Private Limited, India (Board of Directors until October 2016)
Ringier Axel Springer Management AG, Switzerland
(Board of Directors until June 2016)
Ringier Axel Springer Media AG, Switzerland
(Board of Directors until June 2016)
Ringier Axel Springer Schweiz AG, Switzerland (Board of Directors)
SeLoger.com SAS, France (Supervisory Board)
StepStone GmbH (Supervisory Board)
@Leisure Holding B.V., Netherlands (Chairman of the Board of Directors)
AUFEMININ SA, France (Board of Directors)
Axel Springer Digital Classifieds France SAS, France
(Chairman of the Supervisory Board)
Axel Springer Digital Classifieds GmbH
(Chairman of the Supervisory Board until February 2016)
Business Insider Inc., USA (Board of Directors)
Car & Boat Media SAS, France (Chairman of the Supervisory Board)
Coral-Tell Ltd., Israel (Chairman of the Board of Directors )
Immoweb SA, Belgium (Chairman of the Board of Directors)
Media Impact GmbH & Co. KG (Advisory Board)
meinestadt.de GmbH (Chairman of the Supervisory Board)
SeLoger.com SAS, France (Chairman of the Supervisory Board)
StepStone GmbH (Chairman of the Supervisory Board)
174
Financial Calendar
March 9, 2017
Annual Results press conference in Berlin,
Telephone conference for investors and analysts
April 26, 2017
Annual General Meeting
May 10, 2017
Quarterly Statement as of March 31, 2017
August 2, 2017
Interim Financial Report as of June 30, 2017
November 8, 2017
Quarterly Statement as of September 30, 2017
Imprint
Address
Axel Springer SE
Axel-Springer-Strasse 65
10888 Berlin
Phone: +49 30 2591-0
Investor Relations
ir@axelspringer.de
Phone: +49 30 2591-77421/-77425
Fax: +49 30 2591-77422
Corporate Communications
information@axelspringer.de
Phone: +49 30 2591-77660
Fax: +49 30 2591-77603
Design
Axel Springer SE
Corporate Communications
Photos
Andreas H. Bitesnich
Matti Hillig
Sergio Rinaldi
The Annual Report and up-to-date information about
Axel Springer are available on the Internet at
www.axelspringer.com
The English translation of the Annual Report
is provided for convenience only. The German
original is legally binding.