telling stories
touching lives
expanding worlds
Annual & Sustainability Report 2019
Content
This is NENT Group
At a glance
2019 highlights
CEO’s statement
Who we are
Perfectly positioned
Our investment proposition
Sustainability
The NENT Group Share
Governance report
Governance and
responsibilities
Internal control report
Board of Directors
Group Executive management
Risks and risk management
Administration report
Administration report
Business segments
2
4
7
9
26
28
42
45
46
50
51
53
55
59
60
67
Financial statements
Notes to the accounts
Signatures
Audit report
Historical overview
Alternative performance
measures
69
78
118
119
123
124
Sustainability reporting
126
Other
Definitions & Glossary
Financial calendar
Addresses
152
152
153
About this report
The statutory Annual Report covers pages 59–118. The
Sustainability Report (including the statutory sustainability
report) covers pages 28–41, 49, 57, 126–150. NENT Group
reports its sustainability work according to GRI Standards
– Core option. The Annual & Sustainability Report is pub-
lished in Swedish and English. The Swedish version is the
original and shall apply in any instance where the two
versions differ.
At a glance
NENT Group is the Nordic region’s leading entertainment provider.
Our primary revenue stream is the sale of subscriptions, which
have grown significantly in recent years following our early and
significant investments in streaming. Today, we are the Nordic
region’s leading streaming company, with the broadest and most
relevant content offering spanning all Nordic contries, best-in-class
content discovery and a stable and scalable technology platform.
Our key brands
Geographical sales split 2019
Norway
21%
Denmark
30%
Sweden
39%
Finland
6%
Rest of the
world, 4%
NENT Group has two reporting segments: Broadcasting & Streaming and NENT Studios
Net sales by segment
Operating income by
segment, before IAC
Broadcasting
& Streaming, 87%
Studios, 13%
Broadcasting
& Streaming, 95%
Studios, 5%
Broadcasting & Streaming accounted for 87%
of Group sales in 2019. The segment primarily
provides TV and video streaming services in the
Nordic region, as well as radio networks and
music streaming services in Sweden and Norway.
Subscriptions and related services accounted for
71% of segment sales, with the remaining 29%
derived from advertising.
NENT Studios accounted for 13% of Group sales
in 2019. NENT Studios is the leading content crea-
tion, production and distribution business in the
Nordic region, and also operates internationally.
The studios comprise 32 companies in 17 countries,
and are focused on scripted and non-scripted
content, branded entertainment and events.
Net sales
(SEKbn)
15.7
Number of employees
at the end of 2019
1,976
Nationalities
in our team
40+
GRI 102-4
GRI 102-7
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share 2019
highlights
2019 was an historic year for NENT
Group. The highlights included
the listing of the company’s shares
on Nasdaq Stockholm, healthy
organic growth, higher profits
for all business segments, strong
Viaplay subscriber growth, the
implementation of a new operat-
ing model, and the announcement
of the proposed merger of Viasat
Consumer with Canal Digital.
This progress has been reflected
in a total shareholder return of 41%
since the listing of NENT Group on
28 March to 31 December 2019.
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OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Financial highlights
• Net sales increased by 6% on an organic basis
to SEK 15,671m. Subscriptions and related reve-
nues accounted for 61%, advertising for 26%
and Studios for 13% of Group sales.
• The combined operating income for both busi-
ness segments increased by 6% to SEK 1,813m.
Total operating income before items affecting
comparability (IAC) was stable at SEK 1,545m
due to the higher central operating costs of
becoming an independent and listed company.
• The Viaplay subscriber base grew by 310k,
or 25%, to 1,568k subscribers. Streaming cus-
tomers accounted for 62% of NENT Group’s
total subscriber base at the end of 2019.
Strategic highlights
• NENT Group completed its split from Modern
Sustainability highlights
• A new three-year sustainability strategy, including
Times Group MTG AB and successfully listed on
Nasdaq Stockholm on 28 March 2019. The com-
pany has a new purpose, brand, culture, values
and sustainability strategy.
• A new organisational and operating model was
implemented in the second half of 2019. The new
set-up is based on focused areas of responsibility
that operate across the Group, and enable NENT
Group to take decisions faster, ensure strategic
alignment, scale flexibly and efficiently, while also
generating significant savings.
• A 50/50 joint venture between Viasat Consumer
and Canal Digital was announced (subject to reg-
ulatory approval). This will yield substantial cost
synergies and shareholder value, enhance the
customer proposition and further enhance NENT
Group’s focus on Viaplay.
integrated goals, has been launched and is
focused on five focus areas: (1) developing Nordic
storytelling and the creative industry, (2) promot-
ing an equal, diverse and inclusive society, and
driving excellence in our (3) culture, (4) conduct
and (5) content.
• NENT Group is a signatory of the United Nations
(UN) Global Compact and UN Sustainable Devel-
opment Goals (SDG) Media Compact, and has
committed to the UN’s SDGs and Women
Empower ment Principles.
• NENT Group stepped up its engagement in
the fight against diabetes by establishing the
pan-Nordic BEAT Diabetes foundation and
con tinuing to raise awareness of the disease
and funding for diabetes research.
Organic
sales
growth
6%
EBIT
before IAC
(SEKm)
1,545
Stakeholders
engaged in setting our
sustainability strategy
3,000+
Viaplay
subscriber
growth
+25%
# of
premiered
Originals
21
Total
shareholder
return1)
+41%
1) 28 March–31 December 2019
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statement
CEO’s statement
NENT Group has led the way with our early and ambitious investments in
streaming, as well as innovative partnerships with content owners and
distributors. This clearly yielded results in 2019 with higher sales and profits,
and accelerating subscriber growth. The spread of the Coronavirus is bringing
significant challenges in 2020, and we are working hard to ensure the well-
being of our employees and the continued delivery of the best entertain-
ment experiences to our customers and partners. We are well positioned
to recover quickly when things start to normalise, and to take advantage
of the long-term opportunities that lie ahead of us.
An historic and successful year
2019 was an historic year for NENT Group. Our split from
MTG, listing on Nasdaq Stockholm and implementation
of a new operating model have created an even more
engaged, effective and aligned organisation. We have
created a culture and brand based on a new purpose
and set of values, which we are working hard to imple-
ment across the Group, in order to drive future success
and make NENT an even better place to be.
We have significantly stepped up our content invest-
ments, especially in key categories such as sports and
originals. Particularly significant are our new long-term
Nordic rights to the English Premier League football, the
FIS Alpine and cross-country skiing and the IIHF Ice Hockey
World Championship, and the 21 high-quality Viaplay
originals that we have premiered in 2019. We have also
added even more Hollywood content following deals
4
GRI 102-12
GRI 102-14
OverviewPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share CEO’s
statement
with MGM, NBCUniversal and Disney. Having the broadest
and most relevant content offering is vital in realising our
ambition to be the Nordic region’s leading streaming
company.
Our organic sales were up 6% and our Viaplay sub-
scriber base grew by 310k to 1.6 million. Operating profits
for both our segments were up. We are committed to
growing our sales, profits and, most importantly, our
Viaplay subscriber base even further. Scaling Viaplay is
simply the best way to drive long-term shareholder value.
A streaming leader
The entertainment business is changing rapidly and will
continue to do so. The growth of streaming has driven
the rise in total video viewing, even though linear video
consumption is declining. Establishing our position as the
Nordic region’s leading streaming company is essential,
as this is where consumers are spending more and more
of their time and money.
Viaplay’s paying subscriber base rose by over 25% in
2019 and now accounts for 62% of our total subscriber
base. We have gained market share in a very competitive
environment. This is the result of our strategic investments
in content delivered on a world-class technology plat-
form that is getting smarter and learning all the time,
enabling us to offer even more personalised content dis-
covery and a constantly evolving customer experience.
At the same time, we have invested significantly in
attracting and retaining the talents needed to win in
streaming, and we have changed our operating model
in order to accelerate the development of our streaming
business. We are now preparing to launch Viaplay in
We have delivered on our profitable growth commitment, while strengthening
our content leadership and growing our Viaplay base by over 25%. Scaling
Viaplay remains our top priority simply because it’s the best way to drive long
term value. We have also continued to transform including the implementation
of a new operating model, the announced joint venture with Canal Digital and
the restructuring of NENT Studios.
Iceland in the first half of 2020, which will complete
our footprint in all five Nordic countries and showcase
Viaplay’s ability to expand internationally in a fast and
cost-efficient way.
Strategic partnerships
Long term and innovative partnerships accelerate our
growth and drive value. In 2019, our partnerships included
a 50/50 joint venture that combines Viasat Consumer, our
satellite and broadband-TV business, with Telenor’s Canal
Digital. This deal is subject to regulatory approval, which
we expect to receive during Q2 2020. It will yield substan-
tial cost synergies and will also further accelerate our
growth by enabling us to focus even more on streaming
and offer Viaplay directly to Canal Digital subscribers.
We have also signed long-term and innovative distribu-
tion agreements with almost every major operator in the
Nordic region to make our services and channels even
more broadly available, and to create new wholesale
revenue opportunities for Viaplay.
In addition, we established a UK-based joint venture with
leading independent studio FilmNation Entertainment and
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statement
invested in new US studio Picturestart. These are important
steps towards realising our global storytelling ambitions
and will provide more original content for Viaplay.
Our sustainability commitment
Sustainability is central to all that we do and sits alongside
our business strategy, culture and values as the founda-
tions of NENT Group. Our sustainability activities make
us better both on and off the screen and contribute to
a better society. We launched our sustainability strategy
during the year, after we had asked over 3,000 of our
stakeholders about the priorities that we should have as
Group. In developing this strategy, we looked at some of
the biggest challenges that face our society and have
sought to be true to our company values of Bravery,
Equality, Appreciation and Trust.
Our strategy is to create value by developing Nordic
storytelling and the region’s creative industry, and by
promoting an equal, diverse and inclusive society. We are
committed to telling stories that challenge stereotypes
and reflect the diverse society in which we live. We want
to continue achieving gender balance in the creative
value chain, while investing in original productions that
explore urgent contemporary themes such as injustice
and inequality.
The key to our success is our people and culture. We
must attract, motivate and retain the best of the best in
order to continue to be at the forefront of technological
development and content creativity. This requires us to
make a continuous commitment to our conduct, nurture
our culture and produce quality content. To ensure we
live according to our values and sustainability priorities,
we continually train and encourage our managers and
employees. We have initiated cross-functional working
6
Diabetes Gala
groups focused on equality, diversity, inclusion, and envi-
ronmental awareness across the group. Our commitment
led us to sign the UN Global Compact and commit to the
Sustainable Development Goals Media Compact and the
Women’s Empowerment Principles.
As the Nordic region’s leading entertainment provider,
our people, platforms and storytelling contribute to raising
awareness of, and engaging, in societal issues. Diabetes is a
case in point – a disease that is affecting more and more
people, especially in the Nordics. We held our third annual
Diabetes Gala on World Diabetes Day on 14 November
and raised record funds for diabetes research. We have
also established the pan-Nordic BEAT Diabetes foundation,
which will bring together organisations, entrepreneurs
and passionate individuals to support those living with, or
affected, by diabetes.
Perfectly positioned
2019 was a busy and successful year. 2020 started well but
the spread of the Coronavirus is having an adverse impact
on the business. We have acted fast to implement a range
of measures to protect the business, and I am convinced
that NENT Group has the focus, agility and bravery to
deliver in challenging circumstances and to emerge even
stronger and fitter to capture the opportunities that lie
ahead. I truly appreciate the exceptional work of our
talented and dedicated team, and I would also like to
thank the millions of customers who trust us every day to
tell stories that touch lives and expand worlds.
Anders Jensen
President & CEO
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positioned
Who we are
Our vision is to be the leading Nordic streaming service provider and content producer with a global appeal. This means
providing best-in-class experiences, both for our customers and for our employees. We are clear about what NENT Group
stands for, and what we expect of each other. We have four values and a common purpose that were proposed and chosen
by our teams in hundreds of workshops.
Purpose
Vision
Values
Tellling stories, touching lives, expanding worlds
It’s fundamentally about who we are – what we
do – and why it matters. It is beyond making
money. It is our cause and belief. We exist with
the purpose of Telling stories; Touching lives;
Expanding worlds.
We are all storytellers, we tell stories. Stories
connect us and guide us in making sense of the
world. Stories matter and, if they’re inspiring and
exciting, they set our mood, change our mind, and
give us our attitude. A good story touches lives, it
moves us. And we’re not here to just tell any story.
We want to tell the story that touches your life.
The story that makes you think differently, makes
you reflect and expand your mind!
To be the leading Nordic streaming
service provider and content producer
with a global appeal.
Mission
To offer NENT Group’s customers the best
storytelling entertainment experiences
that are relevant, engaging, simple to
use, broadly available, and great value
for money.
We are a company that prioritises people
over everything else – from every single
employee to every single one of our millions
of customers. What unites us all at NENT
Group is our passion to create meaningful
and emotional moments with our content.
Bravery, Equality, Appreciation and Trust
are our NENT Group values – and together,
they form a powerful BEAT, the heartbeat of
entertainment!
For more information about our values, see
page 24.
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Sustainability approach
We are a values-driven company and we want to
make a sustainable impact. This is reflected in our
strategic priorities and approach. Our sustainability
strategy is based on input from our customers,
shareholders, employees and partners, and it is
fully aligned with our purpose, values and business
objectives.
Our content and platforms provide a unique
opportunity to inspire and engage. And, away
from the screen, the way we conduct our business
and nurture our culture makes a difference – for
our people, the creative industry and society.
H O W W E C REATE VALUE
Developing Nordic
storytelling and
the creative
industry
O u r values
Promoting an
equal, diverse
and inclusive
society
Our purpose
Telling stories
Touching lives
Expandin g worlds
B
r
a
v
e
r
y
t
s
u
cia tion | Tr
Nurturing
our culture
| E
quality | A p p r
e
Producing
quality content
Committing to
our conduct
HOW WE DO B E T T E R B U S I N E
S
S
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Perfectly
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Perfectly positioned
The entertainment industry is changing rapidly. Taking a long-term view and staying
on the right side of disruption is essential. NENT Group is the Nordic region’s leading
streaming company and our scale is a key success factor. It allows us to invest in our
people, technology and content – and as we grow, more users means more data,
which we protect carefully and enables us to deliver even better user experiences.
The world is changing
As technology evolves at an ever-faster pace, so does
behaviour. The number of connected devices (smart-
phones, games consoles, tablets and smart TVs) capable
of displaying high-quality streamed video continues to
increase. Combined with faster, more reliable, affordable
and accessible fixed and mobile broadband networks,
consumers can now access an unprecedented range of
streaming services on more devices than ever before.
The fierce competition for consumer time and money
makes it even more important for streaming service pro-
viders to offer great user experiences through a combi-
nation of a broad-based high-quality content offering
and best-in-class technology platforms. Consumers now
hold the power, the power of instant choice.
Video consumption rising
Video consumption is higher than ever before and con-
tinues to grow. However, the way content is viewed is
changing rapidly, with consumers increasingly choosing
to stream on-the-go and on-demand, instead of linear
viewing in-home.
Linear scheduled TV viewing that is not live is falling fast
and the rate of change is highest in the Scandinavian
markets.
We have proactively adopted
We launched our first video streaming service in 2007
– the same year in which Apple launched the iPhone, and
long before our competitors. This early mover advantage
has been important, but even more significant was our
decision in 2012 to disrupt our traditional linear TV busi-
ness by aggressively pushing streaming services and
accelerating our investments in Viaplay’s content and
technology.
This has been followed by fundamental changes in the
skillsets of our people and in the content we acquire and
produce. These decisions were often painful for our linear
TV business but have been key to the success of Viaplay.
Many traditional broadcasters have only recently woken
up to the new streaming reality, and trying to catch up
with established streaming services will now be both
difficult and expensive.
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NENT Group is unique
As a result of our early and significant investments in
streaming, NENT Group is very different from most of
our peers and competitors.
Firstly, our primary revenue stream is subscriptions,
which accounted for 61% of our sales in 2019. Our focus is
on creating recurring revenue streams that will grow over
time, which will also improve visibility and resilience and
reduce volatility.
Secondly, streaming customers make up over 60% of
our total subscriber base and this share is growing quickly.
Thirdly, we are set up in the right way to capture the
significant growth opportunities that we see in the stream-
ing market. Instead of a traditional country-based model,
we are organised according to focused areas of respon-
sibility, such as people, content, marketing and technology,
that work across markets and products. This enables us to
take decisions faster, work smarter, and ensure strategic
alignment across the business.
and has substantially increased its focus on original
content, which has proved popular both with viewers
in the Nordic region and international buyers.
Viaplay is a unique service
Viaplay is a pioneer in streaming with a successful track
record of innovation. Viaplay is today a premium Nordic
video streaming service that can be viewed anywhere,
anytime and on almost any device In addition, Viaplay
offers electronic sell-through (EST), transaction video
on-demand (TVOD) and TV Everywhere (TVE) function-
alities.
Viaplay’s content offering includes sports, acquired
local and international series and movies, kids content,
and original scripted and non-scripted content. Viaplay
has leading positions in Sports, Movies and Kids content,
Viaplay is growing fast
Viaplay’s paying subscriber base increased by 310k, or
25%, in 2019 to 1,568k. This represents an acceleration in
growth compared to the 2016 to 2019 annual growth rate
of 19%. These figures do not include subscribers who have
access to Viaplay as part of a Viasat pay-TV subscrip tion
or as a free trial.
Viaplay has an estimated market share of approximately
25–30% based on the number of stand alone paying
subscribers. Its revenue market share is materially higher
because Viaplay has a leading position in sports packages,
where the price of a subscription is much higher.
A subscription-based business model
Sales split 2019
Subscriber split 2019
Transaction
video on-demand
Viaplay subscriber base growing fast
Electronic
sell-through
TV
everywhere
1,568
CAGR
19%
939
Subscription
& Others 61%
Advertising 26%
NENT Studios 13%
Viaplay 62%
Viasat DTC 19%
Viasat 3rd party 19%
Subscription
video on-demand
Subscription
video on-demand,
sports
Thousands
2016
2019
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Prices aligned
We have strategically aligned our prices between distri-
bution platforms. For a user, the cost of subscribing is
therefore broadly the same via NENT Group’s satellite or
broadband TV services, third partly distribution partners
or directly from Viaplay. Over time, this should support
positive margin development, given that the acquistion
and running costs are significantly lower for streaming
services than traditional pay-TV platforms.
Significant growth potential
Viaplay has grown fast but there is plenty of room for
more. Today, approximately 50% of households in the
Nordic region subscribe to at least one streaming service.
We believe that this penetration level will move closer
to that of TV or the internet, both of which are now
approximately 95%.
In addition, each streaming household today has
an average of approximately 1.8 streamed video sub-
scriptions, and we expect this to rise to approximately
3 subscriptions in the future. In the US, a streaming house-
hold already subscribes to an average of 2.8 services.
Streaming is therefore clearly not a winner-takes-it-all
market. Our ambition is to position Viaplay as a core
streaming service to which most households subscribe
before topping up with other services that cater to indi-
vidual interests. There are 12.5 million households in the
Nordic region,
Nordic SVOD
penetration
No of subscriptions/
SVOD household
Prices have been aligned 1)
~95
~50
~3
~1.8
%
2019 Future
2019 Future
SEK
500
400
300
200
100
0
Viasat Viaplay Viasat Viaplay
TV, movies, sports
TV, movies
1) Monthly subscription prices
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Partnerships powering growth
Distribution partnerships represent an additional
key growth driver. As a result of technology improve-
ments, users can now access Viaplay through a set-
top box and enjoy the same high-quality experience
as a stand-alone subscription. This also enables us
to leverage operators’ existing customer relation ships.
During 2019, we have signed numerous strategic
long-term partnerships that ensure the broad availa-
bility of Viaplay, along with our free- and pay TV-
channels, across the Nordic region. Our partners
include Boxer, Stofa, Waoo and YouSee in Denmark;
Altibox, Get, NextGenTel, RiksTV and Telenor in Norway;
A3, Bahnhof, Connect TV, Kalejdo, Media teknik, Ownit,
Sappa, Serverado, Tele2, Telia and Universal Telecom
in Sweden; and DNA, Elisa and Telia in Finland.
These partnerships reflect our unique content offering
as well as our strategic focus on long-term distribution
deals that are beneficial for all parties.
Expanding to Iceland
We will launch Viaplay in Iceland during the first half
of 2020. Iceland is an ideal market for Viaplay given
the proven local appetite for Nordic language content
and the country’s position as one of the most highly
connected societies in the world.
We have ambitions to expand Viaplay into addi-
tional markets in the future, and the Icelandic launch
will be an opportunity to showcase the scalability of
the platform.
The partnerships reflect our unique
content offering as well as our strategic
focus on long-term distribution deals
that are beneficial for all parties.
A history of innovation
Launch of
first streaming
service
Transformation
of costs, content
acquisition & skill sets
Viaplay to
enter Iceland
2007
2011
2015
2019 2020
Launch of Viaplay
Scaled Viaplay Originals
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We are positioned to win
Viaplay is already one of the leading streaming services in the region and has gained
market shares during 2019. Viaplay has three differentiating factors that position the
service to continue growing faster than the overall streaming market:
Content
Tech
People
A content champion
Being a content champion is about quality as much
as quantity. Viewer tastes are highly individual and
change over time. Consumer insight is very important
but sometimes people don’t know what they want
until something is presented to them. Viaplay’s con-
tent strategy therefore spans three major content
categories; Original content, acquired content and
sports. Each one of these have a number of sub-
categories such as live sports, international movies
and series, kids shows, local language scripted drama
and non-scripted reality. Today, Viaplay has cate-
gory leadership in several of these areas through a
combination of investments in acquired and original
content. Read more about our content strategy on
pages 14–17.
Best in class tech Platform & content discovery
Streaming involves much more than making content
available online. Platforms must be stable and scalable
with great content discovery, which in turn requires
recom mendation engines that provide a personalised
experience based on individual preferences. The fact that
peoples tastes also change means that content can live
much longer than has been the case in the traditional
broadcasting industry, consumer insight is increasingly
becoming consumer science, and the Viaplay team is
able to capture and analyse huge amounts of data that
can improve the viewing experience and bring greater
innovation to the service. In 2019 we also showed over
50,000 live hours of sports with an incredible platform
up-time of 99,97%. Read more about our technology
strategy on pages 18–21.
A unique culture with the right skill sets
We are making significant investments in attracting,
inspiring and retaining the talents needed for success
in streaming. Today, we have over 300 developers
from around the world in our tech team alone. Our
people focus also extends externally, where we use
everything from A/B testing and big data analytics,
as well as direct customer contact, to understand our
customers better. We have recently also changed
from a country to a functional operating model,
which will speed up decision making and develop
skills hubs that can focus even more on understanding
customers’ current and future wants and needs. Our
consumer insights are also reflected in our sustainabil-
ity strategy, as over 1,500 Viaplay viewers had their
say in setting NENT Group’s sustainability priorities.
Read more about our People on pages 22–25.
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Spotlight on Content
Content is king but viewer tastes vary widely and change over time. Offering
a broad and relevant range of content portfolio, and anticipating customers’
needs, are vital for our success.
Scalability and flexibility
We are one of Europe’s leading content buyers, and the
biggest buyer in the Nordic region by some distance.
Buying for multiple platforms and territories increases our
scalability and flexibility. We now acquire most rights at
a fixed price and can use them across all of our different
services and territories or resell to third parties. We have
transformed the way we acquire content and, as a result,
we can constantly optimise our offering according to the
latest consumer insights and data analysis. This set-up is a
key success factor in the scaling of Viaplay.
Category leadership
We are a content champion in the Nordic region, based
on our leadership in the strategically important catego-
ries of sports, original programming, and acquired con-
tent from local and international studios. Having a broad
and relevant product portfolio is essential, and we are
also ambitious about developing our category leadership
even further. We have the following three major content
categories, each of which then have a number of sub-
categories.
14
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g
The content offering
can be divided into
three categories with
sub-categories in each one.
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Perfectly
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50,000 live hours of Sports
We have an unrivalled sports rights portfolio. We showed
over 50,000 live hours of sports in 2019, including football,
ice hockey, motorsport, handball and golf from around
the world. Our major sports rights include UEFA Champions
League, English Premier League, Danish Superliga, Bundes-
liga, NHL, Formula 1, UFC, PGA golf, NFL, IIHF Ice Hockey
World Championship, IHF World Handball Championship
and EHF European Handball Championship. These rights
are typically acquired across all media windows and on
an exclusive, multi-year and often multi-territory basis
from a variety of rights holders.
In 2019, we continued to invest in sports rights, in order
to drive future growth. We have signed new agreements
to become the exclusive Nordic home of FIS Alpine and
cross-country skiing from 2021 to 2026, the Ice Hockey
World Championship from 2024 to 2028, ISU speed and
figure skating until 2023, and IndyCar racing until 2021. We
have also extended key rights such as the Premier League
until 2028 (including the Norwegian rights for the first time
from 2022), the Open golf championship until 2024, and
the Danish Superliga football until 2024.
The addition of winter sports to our portfolio is a parti-
cularly important strategic step, since it establishes leader-
ship in an additional key category and one that is particu-
larly popular in Norway.
We have also increased our coverage of women’s
sports, including top-division women’s football in the UK,
Germany and France, selected international women’s
football matches, WTA tennis and W Series motorsport.
The interest in women’s sport is growing all the time and
our coverage will continue to lead the way.
Premier League
A large and wide ranging sports offering that is secured
for years to come is a key success factor. It creates econo-
mies of scale as more subscribers enable us to invest more
and further enhance our coverage. Sports broadcasting
requires a high degree of craftmanship, including insight-
ful local language commentary, attractive studio shows
and the use of social media to boost viewing and fan
engagement.
The scale and range of our offering means that we are
also not dependent on any single right, so less vulnerable
to sports rights inflation and maintain our discipline of
never buying rights where we cannot make a good return
on our investment. We do also enter into sublicensing
agreements from time to time, in order to maximise our
monetisation opportunities with rights that we have
acquired. Our focus on providing complete on-demand
streaming coverage of all events provides much more
variety and breadth of coverage than before – from
fast emerging sports such as padel tennis to 100% of the
upcoming FIS Alpine and cross-country skiing rights.
15
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Number of originals premiered
>30
21
12
10
5
2016
2017
2018
2019 2020E
Original content
Original content (drama shows, documentaries, kids series
and feature length movies) is a core part of our customer
proposition and a key competitive advantage. This con-
tent is typically commissioned by Viaplay, in order to be
able to deliver exclusive, high-quality and locally relevant
stories to Nordic streaming audiences. Our creative net
spans new scripted drama ideas generated internally by
NENT Studios, concepts pitched by third party production
companies, and new series of established local or inter-
national formats.
Since launching our first original series in 2016, we have
significantly ramped up our investment in this area and
we premiered a total of 21 originals in 2019, with many
more in production or development. The response from
viewers has been very positive, with originals representing
7 out of the 10 most viewed new series on Viaplay in 2019.
There is simply no substitute for local drama. This is a stra-
tegic investment area and we feel very comfortable with
the long-term returns, given the performance to date and
the fact that this content has a long usage life, often runs
to multiple series and can also be monetised on our TV
16
Face to face
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positioned
channels. The ability to package and sell international
rights to these shows around the world is an increasingly
important factor in the funding of the originals, with
around half of our originals already sold to international
partners (distributors, broadcasters and streamers).
Among the highest profile originals premiered during
2019 were ‘Love Me’; ‘Fixi in Playland’; ‘Honour’; ‘Face to
Face’; ‘Straight Forward’; ‘Saga’s Stories’; ‘Wisting’; ‘The
Inner Circle’; and ‘Those Who Kill’’. Our stories are diverse
and offer viewers content with which they can feel cultur-
ally and socially connected. They reflect our efforts to
increase equality, diversity and inclusion, both on and off
the screen, and are an important part of our work to
promote the Nordic creative industry and talents.
Our ambition is to premiere more than 30 originals in
2020 and to increase the number to 40 in future years. This
will also include an increasing number of exclusive English
language productions, some of which will be sourced from
the UK-based joint venture that we formed in 2019 with
leading independent studio FilmNation Entertainment, as
well as from Picturestart, the newly formed studio based
in Los Angeles that we acquired a minority shareholding
in during the year. In both cases, NENT Group has the first
option to the exclusive Nordic media rights for all new pro-
ductions. In today’s highly competitive market for premium
drama, this gives us a compelling advantage and comple-
ments our investments in local language original content.
We have also added a number of massively popular
local non-scripted series, including firm favourites such
as ‘Paradise Hotel’, ‘Robinson Ekspeditionen’, ‘Familien fra
Bryggen’, ‘Masterchef’ and ‘Efterlyst’. These shows are
sourced internally from NENT Studios or externally from
third party production companies.
Acquired
Acquired content is the majority of the content that
we show on our channels and services, and comprises
premium series and movies from studios all over the
world, most notably Disney and 20th Century Studios,
MGM, NBCUniversal, Sony Pictures and Viacom. Our
studio deals are typically signed on a multi-year and
multi- territory basis. First and second pay window deals
are usually exclusive and library agreements are usually
non-exclusive.
We signed new agreements in 2019 with MGM and NBC-
Universal, and have since signed a new long term agree-
ment with Disney. Our new agreements include the
co-production of new originals, which Viaplay has the
option to stream in the Nordics.
The hottest new movies and series from Hollywood help
to attract new subscribers, while the library of previous
shows includes a number of evergreen titles that continue to
drive viewing and are an important customer retention tool.
Tastes vary so the slate of new releases and the deep
library provide customers with an unrivalled choice. We
have category leadership in both acquired movies and
acquired kids content, and the recent agreements have
added further to this leadership position.
Local language originals and live sports are clear
differentiating factors for us. However, it is the combina-
tion of these categories with acquired content that
represents the foundation for our position as the Nordic
region’s leading entertainment provider.
Bohemian Rapsody
17
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Spotlight on Technology
Streaming involves much more than making content available online. In many
cases, viewers don’t know what they want until they see it. NENT Group has built
a platform that competes with the best in terms of performance, functionality
and content discovery.
A proud history of innovation
NENT Group is no stranger to ‘firsts.’ From launching the
Nordic region’s first commercial TV channel in 1987 to the
region’s first satellite TV platform in 1991, we were also the
first in Europe to digitalise a TV platform fully and to add
progressive download functionality to our set-top boxes.
We launched our first streaming service in 2007 and
added download-to-go in 2012. Two years later, NENT
Group became Europe’s first commercial broadcaster to
show the Olympics. In 2019, we launched ‘Fixi in Playland’,
a first-of-its kind animated kids series recorded using
3D gaming technologies and with hidden interactive
elements in every episode.
A winning approach
A platform agnostic approach that makes our content as
broadly available as possible has always been a corner-
stone of our strategy. This is an increasingly important
success factor as more and more homes become multi-
platform and viewers use our services across multiple
devices.
Unrivalled performance
We rely on the technical quality of our offering to help
differentiate us in a competitive streaming market, and
to drive customer value.
We have made significant investments in ensuring our
streaming platforms are both robust and resilient. We
are confident in our ability to meet the demands put on
the service every day. In 2019, our users streamed more
than 730 million hours of content, including coverage of
more than 50,000 live sports events, with an impressive
up-time of 99.97%.
Focus on content discovery
The volume of content offered on our streaming plat-
forms has increased exponentially in recent years.
This is great news for our customers, but it also makes
a personalised experience even more important.
Customers today often face the so-called ‘paradox
of choice,’ where seemingly endless entertainment
options make it harder to find something to watch.
18
Fixi in Playland, programmed to include hidden
inter active elements in every episode.
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By tailoring our content blocks and post-play recom-
mendations, we aim to strike a balance between showing
viewers content similar to previously viewed series and
movies, and offering titles they may have overlooked but
are likely to enjoy.
We have also invested in embedding dynamic and full-
length trailers across the ‘in-app’ experience. This show-
cases the depth of our content library while, at the same
time, helping consumers make informed decisions about
what to watch.
Our launch of Viaplay user profiles in May 2019 has
further enhanced the individual experience for customers.
A family can now manage up to six unique profiles as
part of the same subscription. In doing so, we have been
able to refine our personalisation algorithms and create
customised homepages that are aligned with viewing
preferences.
The platform is getting smarter
We are focused on our customers and on driving engage-
ment by enhancing our offering. As a result, we are shift-
ing away from traditional insight-gathering to more data-
driven decision making in our approach to customer
intelligence. For example, we use comparative A/B testing
in different segments before rolling out new features to
all markets. This gives us a better understanding of how
customers are likely to respond to changes in the platform.
As a consequence of the content discovery algorithms
we have developed, customer viewing levels are increas-
ing. The algorithms use machine learning and artificial
intelligence. They are based on individual viewing patterns
User profiles for enhanced individual experiences
The launch of user profiles in May 2019 has further enhanced the individual
experience for customers – enabling a family to manage up to six unique
profiles as part of the same subscription. In doing so, we have been able
refine our personalisation algorithms and build on this strong foundation to
customise each homepage according to different viewing preferences.
19
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positioned
VR animation technology in StudioV
20
and simultaneously feed information back into the plat-
form about viewer preferences, which creates a sustain-
able competitive advantage. We are therefore confident
that the user experience we offer will improve even
further.
Tech for impact
In today’s competitive entertainment landscape, nurturing
customer relationships is key to driving loyalty and lower-
ing churn. We use our in-house expertise to develop new
and exciting products that reinforce these relationships.
Our new kids’ series ‘Fixi in Playland’, which premiered
during 2019, is a clear example of this. The Fixi character is
an animated squirrel created using performance capture
and virtual reality (VR) animation technology in NENT
Group’s own VR studio, StudioV.
The idea for the series, which targets children aged
from 5 to 8 years, came from one of our annual Hack
Days. We kept the production in-house and this enabled
incredibly fast and agile development – it took just eight
months to go from the initial concept to the premiere of
the 20-episode first season.
We are excited to see how this production method can
change the game in terms of our digital animation pipe-
line, by returning quality entertainment in a short time-
frame. The public reaction to the series has been so posi-
tive that work is already underway on a second season
to premiere in 2020.
But Fixi has more than commercial value. In the series,
she encourages younger viewers to take an interest in
technology and to embrace their differences. She also
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positioned
promotes an active lifestyle by getting viewers off the
couch through regular dance breaks. As a character and
mascot for kids’ content on Viaplay, we believe Fixi has
the potential to make a really positive impact in Nordic
households.
People and products
Our talented Product, Data & Technology team is made
up of more than 300 developers from all over the world.
Every day, we develop cutting-edge technology that is
both stable and scalable. In this work, we focus on people
as well as products, particularly on personalising customer
experiences. In recent years, we have transformed our
skillset away from traditional broadcasting towards com-
puter science and advanced analytics. This helps ensure
we can continue to set the pace in the streaming industry.
Our Product, Data & Tech team
21
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Spotlight on People
Our people are our greatest strength. We work to attract and inspire talents who
want to grow, develop and contribute in a fun, trusting and appreciative company.
Taking care of our people and making sure everyone can be the best version of
themselves is essential to our success.
A culture based on our people
Our company has clear values with a high level of buy-in.
This is because we have built our purpose and values in
a unique way. Instead of a top-down decision, we used
a democratic and transparent crowdsourcing process.
Every employee was invited to workshops to discover
our values together and, through an iterative creative
process, everyone could give input on the outcome of
these discussions through multiple channels.
This work resulted in four values: Bravery, Equality,
We value everyone’s uniqueness – you can just be your-
Appreciation and Trust – BEAT!
Our focus on individual values and self-leadership is also
unique. We believe that creating motivation requires more
than organisational values. True motivation and engage-
ment come when people can be themselves at work, while
being aligned with our shared values and purpose.
The best version of ourselves
We prioritise our people. We want everyone at our com-
pany to grow, and our aim is to provide a safe, fair and
inclusive work environment where everyone can thrive and
feel empowered to be the best versions of themselves.
This is how we define success, and this is why we have
people-focused values. We also believe this is the best
way to achieve great results. When our people grow, so
does our business. Autonomy and self-leadership allow
us to act, fail and recover faster, and stay ahead of the
curve in our extremely fast moving industry.
self here. With the ‘Hearts of NENT’ initiative, we want to
highlight the uniqueness of each individual and bring each
person’s perspective to life, showing what our values
mean to our people.
Building a company for the long run
We dare to look beyond short-term goals and to build a
company for the future. Financial sustainability is impor-
tant, since it enables us to take care of our people, cus-
tomers and shareholders, but we want to do more than
simply maximise our short-term profits. Nurturing a culture
that helps us attract and develop the best people will
ensure we always have the best ideas and talents, which
is how we will ultimately meet our high ambitions.
More information about our people and culture can be
found on pages 35–36.
22
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positioned
Equality is the basis of
our respect for
each other
Meygol Tarahomi
CX Dialogue Manager, Viaplay
23
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Perfectly
positioned
Hit play on
first-class, world-class
entertainment!
We’re a vibrant, upbeat and passionate
company. We buzz with energy, creating
ground-breaking entertainment and pop
culture for people to follow. We have fun,
encouraging our people to step out of
the box with fresh ideas the enable us to
stay ahead of the rest – it’s part of our
challenger DNA!
We’re a place where creativity thrives,
creating original content that’s as exciting
to make as it is to watch. Our culture
and identity are best described in our
employer value proposition – hit play.
24
Feel the BEAT
When you join us and hit play, you will become
part of our culture and learn to live our values.
Our values are defined by the beat we all have
inside us. Defined by the passion we all share at
NENT and how we inspire everyone around us.
Bravery
• I step outside my comfort zone to learn and grow
• I challenge myself, others and the industry
• I keep trying in the face of setbacks
• I dare to ask for help and support
Equality
• I bring my whole self to work
• I ask questions and listen to understand
• I stand up for what I think is right
• I seek co-creation based on diverse perspectives
Appreciation
• I give positive feedback and credit to make people feel valuable
• I give, listen to and learn from constructive feedback
• I get inspiration from celebrating with my team, big and small
• I seek opportunities to pursue my passions, ambitions and
strengths
Trust
• I understand the value of learning from mistakes
• I do what I say, I am responsible and accountable
• I am open, honest and straightforward
• I respect and look out for you – I have your back and you
have mine
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positioned
Our people
are engaged
We operate in a fast moving industry and
we are moving even faster, 2019 was our
first year as an independent and separately
listed company, and we have moved from
a country based to a functional operating
model, launched our new values, and
announced the proposed merger of our
Viasat Consumer business and Telenor’s
Canal Digital.
We conducted a group wide engagement
survey in December 2019 and it is clear from
the results that we have a strong foundation
from which to build NENT Group moving
forward. Here are some highlights from the
people who completed the survey (81% of
all staff).
87%
are willing to make
an extra effort to
make NENT Group
successful
89%
feel they
cooperate well
in their teams
90%
feel they are
respected by
their manager
91%
feel they can
be themselves
at work
88%
feel that
all employees
have the same
opportunities
75%
challenge the way
we do things
in order to learn
and grow
The percentage equals the share of our people
answering 4 or 5 on a 5 point scale.
25
OverviewCEO’s statementInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Investment
proposition
Our investment proposition
NENT Group is, first and foremost, an investment in Viaplay which is the leading Nordic streaming service. Our market share
in streaming is significantly higher than in the traditional pay TV market meaning that we are benefitting from the change in
the way people consume content. Scaling Viaplay is simply the best way to drive significant and sustainable shareholder value.
A unique play on the Nordic streaming market
NENT Group is the Nordic region’s leading entertainment
provider and also the region’s leading streaming service.
NENT Group’s high-profile brands offer both subscription
and advertising funded streaming services. Viaplay is the
leader in the fast growing subscription funded streaming
market. The penetration of streaming services in the
Nordic region, and the number of services to which each
household subscribes, are both expected to grow signifi-
cantly over the coming years. The subscription model
creates recurring and growing revenues with high incre-
mental margins. In addition, it provides additional benefits
such as increased visibility, reduced volatility and more
resilient revenue streams.
All success factors already in place
NENT Group is today a content champion in the Nordic
region. We offer a unique combination of the broadest
and most relevant content, and hold category leadership
positions in sports, originals and films.
Listing ceremony on
28 March 2019
26
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proposition
Viaplay is a world-class streaming platform that offers
more functionality than any other service. The platform
has also proven to be extremely stable demonstrated
by its ability to deliver more than 50,000 hours of live
streamed sports every year with almost no down-time.
In addition, Viaplay is continually getting smarter by
analysing user data and competes with the best when it
comes to personalised and relevant content discovery.
Finally, we have a world-class team with a shared pur-
pose, values and behaviours. We have invested significantly
in attracting, motivating and retaining the talents needed
to win in streaming, and we have also changed our organ-
isation and operating model during 2019 to accelerate the
development of our streaming business further.
A proven track record
NENT Group has delivered healthy top and bottom line
growth, while investing substantially in content, technol-
ogy and our people, in order to take a leading position in
the Nordic streaming market. Our focus is on maximising
long term shareholder value by scaling Viaplay. We aim
to do so through continued investments in the customer
experience and through strategic partnerships such as
our recently announced joint venture between Viasat
Consumer and Canal Digital, our investment in Picturestart,
joint venture with FilmNation Entertainment, and our chan-
nel and service distribution deals with the leading regional
telecom and broadband partners. NENT Group has a
long-term commitment to profitable growth and ongoing
dividends.
Net sales
EBIT for combined business segments
12,897
CAGR
7%
15,671
1,813
CAGR
8%
1,427
SEKm
2016
2019
Subscription
and other
Advertising
Studios
SEKm
2016
2019
Broadcasting & streaming
Studios
Before central operations & IAC
27
OverviewCEO’s statementPerfectly positionedSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Sustainability
Content
How we create impact
29
Developing Nordic storytelling
and the creative industry
31
Promoting an equal, diverse
and inclusive society
Nurturing our culture
Committing to our conduct
Producing quality content
32
35
37
40
28
How we create impact
At NENT Group, sustainability is integrated with our business strategy, culture and
values. In 2019, we set our sustainability strategy, which will shape how we create
value and make a positive impact in the years to come.
Administration
report & Financial
statements
Our strategy
Sustainability is integrated with NENT Group’s business
strategy, culture and values. Our ambition is to make
a positive impact in society while doing better business.
Our priorities are presented in our sustainability strategy,
which consists of five focus areas: developing Nordic story-
telling and the creative industry, promoting an equal,
diverse and inclusive society, and driving excellence in
our culture, conduct and content.
Through these areas, we aim to create value for society
as a whole, as well as for our shareholders, customers
and employees and for the creative industry. The sustain-
ability strategy was set during 2019 and is based on a
thorough stakeholder dialogue that included over 3,000
survey respondents and 55 internal and external meet-
ings held during autumn 2018.
H O W W E C REATE VALUE
Developing Nordic
storytelling and
the creative
industry
O u r values
Promoting an
equal, diverse
and inclusive
society
Our purpose
Telling stories
Touching lives
Expandin g worlds
B
r
a
v
e
r
y
t
s
u
cia tion | Tr
Nurturing
our culture
| E
quality | A p p r
e
Producing
quality content
Committing to
our conduct
HOW WE DO B E T T E R B U S I N E
S
S
GRI 102-15
Sustainability strategy for NENT Group
29
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Our world and our opportunities
We operate in a fast-changing environment that creates
both challenges and opportunities for our business.
When setting our sustainability priorities, we considered
today’s megatrends and the biggest challenges faced
by the world and our Nordic society. These include
climate change, rapid technology shifts, and a society
with in creasing levels of inequality and segregation.
As the Nordic region’s leading streaming company,
we create value by investing in new and diverse talents
and promoting Nordic storytelling globally. We have
an opportunity to promote a more equal, diverse and
inclusive society through our stories and platforms.
At the same time, we are focusing on equality, diversity
and inclusion (EDI) throughout our entire production
value chain.
During productions, we are working to create a more
inclusive, safer and fairer environment, and by telling
unique stories and reflecting today’s diverse society on
screen, we are challenging stereotypical attitudes, norms
and prejudices. This also increases our relevance by
helping us reach a more diverse and broader audience.
In short, we can make a positive difference by developing
Nordic storytelling and the region’s creative community,
investing in new and diverse talents, and promoting
Nordic storytelling globally.
When it comes to technology shifts, we are at the very
forefront of change as a streaming leader. In addition to
offering entertainment on demand through a wide range
of platforms, we use the latest technologies to create
interactive kids content that both educates and entertains
while offering safe and trusted experiences.
30
On climate change, we encourage green conduct
amongst our employees, and in our operations to mini-
mise our environmental impact and in that way mitigate
climate changes.
NENT Group’s sustainability strategy is directly aligned
with 8 of the UN’s 17 Sustainable Development Goals
(SDGs). This highlights our commitment to helping find
sustainable solutions to global challenges. This commit-
ment is also reflected in being a signatory member of
the 10 principles of the UN Global Compact. We are
also committed to the SDG Media Compact and the
Women’s Empowerment Principles.
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Developing Nordic storytelling
and the creative industry
We are writing a new chapter for Nordic storytelling and the region's creative
industry by investing in original content and promoting local talents.
A new chapter for Nordic storytelling
We are Nordic in origin and global in terms of our themes,
partnerships and audiences. We offer a broad and diverse
product portfolio that includes some of the best inter-
national content available. At the same time, we work
closely with local talents to produce critically acclaimed
Nordic storytelling. Through the 32 production companies
that comprise NENT Studios, we produce series, films and
documentaries in every Nordic language. In this way, we
engage millions of people every day and provide a plat-
form to promote the Nordic creative industry, along with
the region’s languages, while contributing to local com-
munities and talents.
our kids original series ‘Saga’s Stories’, the factual pro-
grammes ‘Troll Hunters’ and ‘Tjafs’, and our coverage of
the IHF World Handball Championship. In addition, the
Danish series ‘Chemo Brain’, produced by the NENT Studios
company Splay One, was shortlisted at the Sundance Film
Festival – the first time a Danish series has been recog-
nised at this prestigious event.
We develop the creative community
Creativity contributes to an open, vibrant, and inclusive
society. For this reason, we think it is important to create
a Nordic hub for creative talents and to invest in and
develop the local creative community.
In 2019, NENT Group premiered 21 original productions
Every year, NENT Group hosts an award ceremony
in Denmark highlighting talents from our production
companies who create content for the Danish market.
The awards cover categories such as talent of the year,
Viaplay originals, Viafree originals, programme of the
year and innovation.
across the Nordic region (10 in 2018). Around half of our
originals have been sold internationally in regions such as
Europe, North and South America, Oceania and Asia to
broadcasting and streaming partners such as the BBC,
ARTE and Amazon. We aim to continue this success story
by premiering at least 30 original productions over the
coming year.
Our content is critically acclaimed. In 2019, we received
11 nominations at Sweden’s ‘Kristallen’ awards, including
GRI 103-1
GRI 103-2
GRI 103-3
GRI 203-1
M3
In brief
See pages 132–134 for details
Goal 2021
• I nvest in Nordic storytelling with a global
appeal. When doing so we create
job opportunities in the local creative
industry.
SDG and targets
Target 2019
• I ncrease the number of
premiered Viaplay originals
(from 10 in 2018 to 21 in 2019).
8.8
Status
Strategy dimension
Value
creation
Better
business
Target 2020
• I ncrease number of
premiered Viaplay originals
from 21 to at least 30.
• Launch a recognition concept
promoting new and diverse
talents in the creative industry.
For new talents, accessing the creative community can
be very challenging. We want to change that by devel-
oping a recognition concept that connects talents with
opportunities in media production, which we are planning
to launch in 2020. Giving opportunities to new talents is
good for NENT Group as well as the creative community,
since we are continuously searching for unique stories
and to reach a broader audience.
31
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Promoting an equal, diverse
and inclusive society
Our work with equality, diversity and inclusion (EDI) starts with our people, shapes
our stories and touches our societies. We use our platforms and our reach to
inspire, engage and form partnerships that can raise awareness and promote
positive change.
A holistic approach to EDI
At NENT Group, we take a holistic and integrated
approach in our work with EDI. We want our stories to
reflect a plurality of views and to appeal to diverse
audiences. In order to achieve this, our company needs
to reflect our society.
It is therefore important for us to give a voice to different
groups and to be a safe space where people from all
backgrounds can express themselves. In 2018, we created
EDI working groups focusing on EDI in our workplace, and
in our product portfolio and content value chain. The task
of these two groups is to continuously identify our EDI chal-
lenges and enablers, and to develop an improvement plan
and metrics. The goal for this work is to raise our aware-
ness about this topic in the organisation and make it show
in our work, both internally and in our content.
To reinforce this work, and to ensure we meet our
ambitions and goals, we have appointed a Head of
Diversity & Inclusion tasked with leading our efforts to
make NENT Group the most equal, diverse and inclusive
company in our industry.
Equality in front of and behind the camera
We work for greater diversity including gender balance
in the entertainment industry. At the same time, we under-
stand that successfully telling diverse stories requires us to
look at our whole value chain.
To get a better insight into just how equal we are
today, we mapped the gender balance in our creative
value chain for scripted and non-scripted content in our
Nordic markets for 2018 and 2019. The mapping covered
five key positions in each production: director, writer,
producer, cinematographer and lead actress/actor.
The results show that we have improved our gender bal-
ance for these groups from 46% women in 2018 to 61%
women in 2019. The main reason for this is an increased
percentage of mainly female producers and actresses in
our scripted content. An example is the comedy-drama
‘Love Me’, starring and written and directed by Josephine
Bornebusch.
However, we see room for further improvement,
especially when it comes to female directors, cinema-
tographers and writers. We will therefore focus our
In brief
See pages 132–134 for details
Goal 2021
• I ncrease diversity and inclusion off
and on screen.
• Improve gender balance in our content
value chain and organisation.
• Raise awareness of diabetes through
partnerships.
SDG and targets
3.4
5.1, 5.5
10.2, 10.3
17.16
Target 2019
Status
Strategy dimension
• Identify EDI challenges and
enablers (internally and in
content value chain) and
develop improvement plan.
• Map gender balance in
content value chain.
Value
creation
Better
business
Target 2020
• I nclude unconscious bias in values training.
• Increase percentage of women in key
positions in the creative value chain.
• Establish Diabetes
Foundation with at
least 4 partners.
32
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OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share
efforts on scripted productions while continuing to work
on attracting and investing in diverse talents. Our goal for
2021 and onwards is 50/50 gender balance in our scripted
productions (baseline: 44% women in 2019). A key activity
in this area will be to rollout a recognition concept that
aims to help new talents enter the creative industry. We
will also include unconscious bias in the roll out of our
values training.
In our productions, we are taking the lead in creating
a safer and fairer work environment free from any kind
of discrimination and sexual harassment. For example,
we screen people in key positions in each production to
make sure they share our values. We provide information
about our whistleblower service to all productions (both
at start-up meetings and during set visits) to ensure every-
one knows what to do and who to contact in the event
of any violations. Creating a safer work environment is
an industrywide challenge as many of our creative talents
work across the industry.
Our annual employee engagement survey includes
questions relating to discrimination, and we follow up the
results of the survey throughout the year and take appro-
priate measures where required. There have been no
reported discrimination incidents in 2019.
NENT Group has been involved in the #metoo discus-
sions and we helped initiate an ongoing industry-wide
working group with our peers to create a positive path
forward. In 2019, we hosted an industry discussion and
engaged in forums such as ‘Pulse Check’ and ‘Tystnad
tagning’ that aim to address issues relating to working
environment, diversity and gender in productions.
The Ambassador
We tell diverse and unique stories
We want our stories to be both unique and to reflect
society. This means we need to challenge stereotypical
ways of depicting people and societies, and to adapt
our scripts when needed (for example turning the action
man into an action woman). That also means we invest
in storytelling that raises societal issues. For example, our
original series ‘Honour’, which is created by and stars some
of Sweden’s leading female creative talents, explores
urgent contemporary themes such as injustice and in -
equality, created by and starring a stellar line-up of
top female talent. We also believe in the importance
of investment in women’s sports, including women’s hand-
ball, top-division football from England, Germany and
France, LGPA golf and WTA tennis. Diverse content creates
value for society and gives us an opportunity to engage
and reach a wider audience.
Positive change through partnerships
In addition to our platforms, we aim to raise awareness
and create positive change in society through partner-
ships. We are particularly focused on helping to create
a more equal, diverse and inclusive society. Examples of
our partnerships include:
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OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share BEAT Diabetes
In the Nordic region, diabetes currently impacts over 1.5
million people, according to the International Diabetes
Federation. The region is also home to the highest amount
of people with Type 1 diabetes in the world per capita. In
response, NENT Group has organised a Diabetes Gala on
World Diabetes Day every year since 2017, in collaboration
with the Swedish Diabetes Association. During this time, the
event has raised over SEK 20 million for research into type
I and II diabetes, and set a new record in 2019 by raising
over SEK 8 million. In 2020, we will step up our engagement
by initiating the pan-Nordic BEAT Diabetes Foundation, an
independent entity in which we will invest SEK 2.5 million
every year to raise awareness and drive positive change
within three areas: health tech, healthy lifestyles, and in -
clusion and wellbeing. We believe joining the fight against
diabetes also contributes to a more inclusive society.
Women in Tech
In Sweden, we are a founding partner of Women in Tech,
an annual event that aims to promote equality and to
inspire talented women to pursue careers in technology.
In 2019, the event took place for the sixth consecutive year
on International Women's Day, 8 March, and we hosted a
seminar in which some of our leading female tech talents
shared their experiences from product development. For
the second year in a row, we also streamed the event free
on Viafree in order that more people could take part.
Women in Tech
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Hello World
We believe in cultivating interest in technology amongst
both boys and girls at an early age. As a result, we part-
ner with Hello World to sponsor talented kids in learning
digital skills.
Locker Room Talk
The sports world is not always equal, diverse or inclusive.
This is why our studio programmes raised awareness of
homophobic issues in Danish Superliga football, and why
we sponsor and collaborate with Locker Room Talk, an
organisation that aims to educate boys in fairness and
equality. During the year, we have used our platforms
and programmes, such as our NHL ice hockey studio, to
discuss these issues.
Reach for Change and additional partnerships
In 2019, we teamed up with Reach for Change to help
social entrepreneurs develop solutions that help children
lead healthy lives. We have also been engaged with
Gener ation PEP, which aims to inspire children to be more
active. In Norway, we supported #SheGotThis in a quest
to achieve a more gender equal society. Splay One
Norway hosted an auction with the Red Cross to highlight
the problem of loneliness amongst youth, raising over
EUR 4,000 for the cause and reaching over 20,000 unique
viewers.
We have also donated airtime to organisations with an
important cause, giving them the possibility to reach a
larger audience with their important messages. In total in
2019, we have donated airtime in the value of over SEK 45
million to e.g. Red Cross, UNICEF, SOS Children's villages
UNHCR and Reach for Change.
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Nurturing our culture
We believe equal opportunities and inclusion for our people will fuel our success.
Our values build the foundation of our culture and help creating an open and
engaging workplace that aims to inspire employees, audiences, and creates
long-term business value.
The best version of ourselves
We want everybody at NENT Group to be the best ver-
sion of themselves. This is the only way we can continue
to attract the best talents and deliver the best results in
everything we do. Our culture is, in short, the key to our
sustainability and success.
We operate in a dynamic industry and in 2019 the pace
of change for our people was particularly high. During
the year, we completed our split from Modern Times
Group and moved from a country-based to a functional
operating model. As a result, our most recent annual
Engagement Survey, carried out in December 2019 with
a response rate of 81%, shows a slight decline in both the
Engagement Index (from 77% to 76%) and the Team
Efficiency Index (from 78% to 77%). Nevertheless, these
are still high numbers. Our new psychosocial Working
Environ ment Index (76%; global benchmark 73%) was also
positive. Overall, we have both room for improvement
and a solid foundation on which to build.
Integrating our values – creating our culture
We believe self-leadership is vital for professional and
personal growth. When we are empowered to act, col-
laborate and trust in each other's strengths, our teams
become even greater than the sum of their parts. In 2019,
our people came together to create four shared values
for NENT Group. We call it 'the BEAT': Bravery, Equality,
Appreciation and Trust. We also rolled out values training
across the company. The high scores in the BEAT Index in
this year’s Engagement Survey show we are on the right
track with high scores on questions like “do you feel you
can be yourself at work” and “do you give positive feed-
back in your team” (see more info on page 25).
In 2020, we will work even harder to build an inclusive
and positive culture. We will launch a new Employer Value
Proposition (EVP) while continuing to integrate our values
into our daily activities. For example, we will review our
talent acquisition and succession planning processes from
an equality perspective. We have also recently recruited
NENT Group’s first-ever Head of Diversity and Inclusion.
In brief
See pages 132–134 for details
Goal 2021
• Ensure all managers have tools and
knowledge to work for trust and
inclusiveness in their teams.
• Raise employee rating of health, safety
and wellbeing at the workplace from
76% in 2019 to 78% in 2021 in the Engage-
ment Survey.
SDG and targets
5.5
8.8
10.3
Target 2019
Status
Strategy dimension
• Develop culture and values
training for all employees.
• Raise awareness of travel and
workplace security.
Target 2020
• Provide values training for at
least 80% of all employees.
• Review talent acquisition and
succession planning processes
from an equality perspective.
Value
creation
Better
business
• Identify challenges and ena-
blers for a healthier and safer
workplace.
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Developing our people
Every year, we conduct training for direct and indirect
managers, and each function carries out additional
training for their people. We also operate the one-year
Challenger program to reward and acknowledge top
talents across the organisation. In 2019, 76% of our people
received a performance and career development review.
In 2020 we will keep focusing on the implementation of
our values building an inclusive and engaging culture.
In return we can continue delivering the best experience
for current and future audience.
Staying safe at work
The safety and security of NENT Group's employees and
assets is of high importance. For this reason we have a
Risk and Security function working closely with all other
functions in the organisation to identify potential risks, find
ways to mitigate them, train teams and implement pro-
cesses, systems or insurance policies that protect both the
employees and the business. In 2019 we had 5 reported
incidents with connection to safety and security and we
have taken relevant measures for all of them.
In 2020, offering healthy and safe workplaces will con-
tinue to be a top priority at NENT Group. We will focus on
identifying and acting upon challenges and enablers in
this area, and on raising awareness through communica-
tion and training.
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OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Committing to our conduct
We conduct business responsibly and with integrity, and we expect our suppliers
and partners to do the same. Keeping information and data relating to our business,
customers and stakeholders safe is a top priority. We work hard to minimise our
environmental footprint and we raise awareness of eco-friendly behaviour across
the organisation.
Our governing framework
In 2018, NENT Group established a Code of Conduct
(CoC) for our employees along with a Supplier CoC.
Together with our Group policies and directives, these
documents constitute a framework that defines how
we do (and do not do) business and helps ensure we
do not breach any regulations and live our values:
Bravery, Equality, Appreciation and Trust. The frame-
work is based on accepted standards and principles,
including those relating to human rights, and it is sub-
ject to regular reviews and follow-ups.
Implementing our framework
NENT Group operates in a fast-moving industry and
we have also carried out a major reorganisation in
2019. In this context, it is even more important to ensure
that our governing framework is implemented and
sustained in every part of the organisation. We have
evaluated the implementation of the CoC throughout
the year and have found that 100% of new employees
have signed the Code.
Every other year, our employees must complete
e-learnings covering our CoC (including human rights,
anti-bribery & corruption, asset/data protection, and
competition). These e-learnings were rolled out in 2018
and will be rolled out again in 2020. From 2018 to the end
of 2019, 88% of the employees had done the e-learning.
During 2019, we conducted compliance workshops, which
inter alia included competition and AB&C, for all leader-
ship teams. We are planning to launch risk and compli-
ance awareness workshops for our new management
teams in 2020 and relevant parts of our sales staff will
receive targeted ethical sales training.
It is important that our suppliers and business partners
conduct business responsibly. We have established routines
designed to track that our major suppliers support our
Supplier CoC. We are in the process of reviewing the
im plementation of our Supplier CoC and improving our
processes in this area. In 2020, we will identify our high-
risk suppliers and conduct a detailed follow-up that
aims to make sure their businesses are aligned with
our Supplier CoC.
In brief
See pages 132–134 for details
Goal 2021
• Raise awareness of our Code of Conduct
(CoC) and values (including data privacy).
• Address and engage with all identified
high-risk suppliers to ensure committment
to our ethical standards.
• Reduce total CO2 emissions from business
travel, facilities and energy use by 10%
(base year 2019).
SDG and targets
13.3
16.5
Target 2019
Status
Strategy dimension
• Evaluate CoC rollout
programme.
• I mprove data protection
management.
• Set launch plan for green
awareness week and
green initiatives.
Target 2020
• Increase employee
awareness of CoC.
• Raise supplier awareness
of Supplier CoC.
Value
creation
Better
business
• Reduce total CO2 emissions
from business travel, facilities
and energy use by 5%
(base year 2019).
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OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share
In 2019, NENT had zero incidents of corruption. One
whistle blower-related matter was reported where an
in-depth investigation was initiated. The matter related
to a potential conflict of interest and was resolved during
the year. We encourage our employees to report any
concerns and we aim to raise awareness of our whistle-
blower process in 2020.
Protecting our data and content
As part of NENT Group’s new organisational model,
we have reviewed and updated our Data Protection
Manage ment network in order to be better equipped to
assess and handle data privacy matters. NENT Group’s
Data Protection Officer is now supported by a network
of full-time dedicated Data Protection Managers across
the organisation. In 2019, we reviewed and improved
our Data Protection & Security Management system,
which inter alia contains information about the personal
data we process within the organisation.
Protecting our content from piracy activities is a priority
for us. Our work managing this risk is structured within our
Information Security department, but also closely tied to
our legal, technical and operational entities. We continu-
ously review this risk and take appropriate measures.
We also cooperate with specialised external organisa-
tions (such as APAA and NCP).
38
The Ten Principles of the
UN Global Compact
UN’s Guiding Principles for Business
and Human Rights
The ILO’s
Core Conventions
The OECD Guidelines for
Multi national Enterprises
The Universal Declaration
of Human Rights
Laws and
regulations
Code of
Conduct
Supplier Code
of Conduct
FOLLOW UP
POLICIES
• Anti Bribery
and Corruption
• Sustainability
• Data Protection
• People
• Risk & Security
• Communication
• Competition
• Others
DIRECTIVES – Complement to CoC and Policies
• Equality and
Diversity
• Global Tax
• RIsk manage-
• Whistleblower
• Others
• IT
ment
Internal Audit
Internal audit following up that the business is conducted
in a way that aligns with the governing framework.
Review of policies
Policies are adopted by the Board of Directors and
revised annually. Directives are adopted and revised
by CEO and CFO.
Whistleblowing
NENT Group encourages employees to raise concerns
at the earliest possible stage, and through the usual
reporting lines as appropriate. There is also a possibility
to report anonymously through our Speak up line
channels without the risk of retaliation.
NENT Group’s Governing Framework
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Small efforts make a difference
We want our facilities to be sustainable as well as fun
places to work. In Sweden, our main office is a green build-
ing, and both the coffee and cleaning products used are
green certified. In Denmark, we use CO2 neutral electricity
and purchase about 80% fruit and vegetables compared
with below 20% meat, all having our CO2 footprint in mind.
In Norway, we use two electric bicycles for travel to meet-
ings, while one of our Norwegian NENT Studios offices uses
renewable hydropower. The NENT Studios office in Stock-
holm also uses renewable energy. In Finland, the share of
biogas in our heating supply increased during 2019, while
in the UK, we use solar panels, and our electronic equip-
ment has a sleep mode, similar to our main Swedish office
where our lighting system has sleeping mode.
Our efforts also cover office waste recycling in Sweden,
Norway, Denmark and the UK, and we work on replacing
all paper cups and plastic cutlery with wooden, metal
and porcelain alternatives, which has already been done
in the UK, Denmark and one of our NENT Studios offices in
Norway.
off a Green Awareness Week in 2020 throughout all
markets, with the intention of informing, engaging and
inspiring our teams to contribute proactively to making
NENT Group a greener business. We also started an
Energy Consumption Network focused on reducing CO2
emissions generated by energy consumption in our facili-
ties. When it comes to business travel, we implemented
green travel tips on our intranet that aim to nudge people
into choosing eco-friendlier travel alternatives, such as
taking the train instead of flying to destinations in the
Nordic region. Our travel booking system also recom-
mends greener hotels.
We manage our environmental impact
We measure our carbon footprint from travel, energy
consumption and office materials by applying the
industry-standard Greenhouse Gas Protocol. In 2019, our
climate impact totalled 7,484 tonnes of CO2e equivalent.
About 74% of these emissions came from business travel,
with air travel representing 63% of our total emissions.
Almost all remaining emissions came from energy con-
sumption in our facilities (20%).
We monitor our carbon footprint for 100% of our oper-
ations. Our Group Sustain ability Policy covers environ-
mental issues and sets out our preventative approach to
managing our carbon footprint. Because business travel
is our biggest emission factor, in 2019 we updated our
draft Group Travel Directive to include more sustainable
travel practices, such as train travel for shorter distances,
increased use of video conferencing, and booking direct
flights for long-haul destinations.
Thinking and acting greener
Our environmental efforts are focused on two areas:
changing behaviours by raising awareness, and taking
action to reduce CO2 emissions from business travel
and energy consumption. We apply the precautionary
principle when assessing the environmental and health
impact of our operations.
During 2019, we initiated a Green Working Group with
representatives from across the organisation. The aim
is to raise environmental awareness and inspire our
employees to embrace greener behaviour. We are kicking
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OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Producing quality content
We follow responsible sourcing, production and advertising practices, and comply
with Ofcom's regulations protecting minors and minorities. We are working to
bring down barriers through subtitling and dubbing so our content is more easily
accessible.
A proactive approach to broadcast compliance
Most of NENT Group’s broadcast licenses are held in the
UK, where the regulator Ofcom sets out clear rules on
programme content, sponsorship, product placement,
fairness and privacy through its Broadcasting Code.
Viewers can file a complaint relating to our linear chan-
nels or streaming services (including advertising) at any
time, either to the regulator or via our websites. We
record details of every complaint received, and the scope
of complaints covers both original, acquired, and adver-
tising content.
In the event of a complaint, Ofcom will request a copy
of the content and will assess both the specific subject of
the complaint and the programme as a whole. For exam-
ple, if a viewer complains about violent content in a pro-
gramme, the regulator will also check sponsorships and
product placement in the same programme. This ensures
effective monitoring and means we assess all complaints
and treat them equally.
We also make our own assessment of the content to
ensure our pre-broadcast compliance procedures have
been followed and are fit for purpose.
We require all advertising shown on our channels and
services to follow Ofcom’s rules, and all commercial con-
tent is approved by our Content Compliance Team prior
to broadcast. If necessary, we adjust the content. Our
team regularly reviews Ofcom’s bulletins detailing ‘in
breach’ material on other services, along with the regula-
tor’s guidance on how broadcasting rules should be inter-
preted. We also work to ensure continued adherence to
regulations through annual training for all relevant inter-
nal and external staff. In 2019, we received 7 programme
content complaints, 5 of which were not upheld, and 2 still
pending at the year end.
Living our values
We incorporate the Ofcom Broadcasting Code in our
agreements related to content production, and NENT
Group’s Code of Conduct is always included in agree-
ments with production companies and forms part of the
agenda at every start-up meeting for a new project.
All our original productions are screened before
broadcast on our linear channels. Our Viaplay team
frequently consults our Content Compliance Team and
In brief
See pages 132–134 for details
Goal 2021
• I mprove the family experience on
Viaplay by offering safe & trusted
digital experiences.
SDG and targets
• Increase content accessibility beyond
regulatory requirements.
10.2
12.6
Target 2019
Status
Strategy dimension
• Create Editorial Guidelines.
• Broadcast content on our
channels with audio descrip-
tions (10%) and subtitles (70%).
Target 2020
• Establish kids and parents
focus groups for all our kids
original productions to ensure
our content is responsible,
educational and entertaining.
Value
creation
Better
business
• Introduce audio descriptions
and signed language content
to our streaming platforms.
40
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we are currently establishing a process to ensure all
Viaplay originals are reviewed by the Content Compliance
Team. Edits are all reviewed and approved multiple times
before a final sign off at each stage of the production.
We stand up for freedom of expression, privacy and
editorial independence, and in 2019 we created editorial
guidelines for all NENT Group’s content. In particular, we
promote diversity and plurality in our content: more infor-
mation can be found on page 32.
Safe and trusted entertainment for everyone
We help our viewers make informed decisions about what
to watch. We screen all sensitive content and apply appro-
priate scheduling restrictions to protect younger viewers.
We provide on-screen warnings if a series or film contains
potentially offensive, sexual or violent content. In addition,
we do not show adult content on any of our platforms.
In 2017, our research found that parents feel safer letting
their children use Viaplay than any other streaming service.
Parents can set the Viaplay kids’ section as a default, con-
trol access to other content via a pin code, and create
dedicated kids profiles that filter out unsuitable content.
As we want both the kids and their parents to feel safe
when consuming our content, we work with responsible
distributors and producers to make sure we do not publish
content that goes against our values. In addition, our Kids
principles provide us with moral guidelines, emotional
insights and guides our work.
Making our content accessible
Ofcom’s regulations require us to broadcast a certain
amount of content with audio descriptions (10%) and
subtitles (60%). In 2019, we exceeded these targets on all
our free-TV channels in Sweden and Denmark, with 18% of
content including audio descriptions and 95% including
subtitles. We have also introduced sign language caption-
ing to TV3 in Sweden. In 2019, 3% of content on the channel
included sign language captioning, and 29% included hard
of hearing subtitling.
To further improve content accessibility, in 2020 we will
introduce audio descriptions and signed language content
onto our on-demand platforms. Also, launching Viaplay in
Iceland in the first half of 2020 will allow our Viaplay sub-
scribers in Iceland to enjoy the benefits of the EU Portability
Regulation.
Educating, entertaining and responsible platforms
Kids are one of our main audiences, and we want to offer
content that both educates and entertains.
Examples in 2019 include our original kids’ series ‘Fixi in
Playland’, which mixes animation with virtual reality and
encourages kids to take an interest in technology and join
Fixi for a physical exercise. Fixi is an animated squirrel with
a robotic arm; so besides promoting an active lifestyle
and tech knowledge learning, she also visually encourages
viewers to embrace the way they are. Our third season of
‘The Great Escape’ which won Sweden’s Kristallen Awards
for Children’s Programme of 2017, aims to inspire kids to
learn more about maths and chemistry. Moving forward,
this series will also focus on climate change and saving the
oceans. Another of our kids’ originals, Peppy Pals, com-
bines engaging entertainment with focus on developing
emotional and social intelligence. In 2020, we will premiere
‘Mia’s Magic Playground’, an animated series based on the
Mia’s magic
playground
popular online concept ‘Little Baby Bum’, in which the lead
characters explore an imaginary land that contains lessons
about life for the real world.
To ensure we tell understandable and relevant stories,
we include kids in the creation of our content. In turn,
this process helps kids to analyse, evaluate and critically
consume our content. ‘Fixi in Playland’ was developed
together with a school class of 8 year-olds, and we have
a focus panel that includes 60 kids aged up to 12 years to
help us assess our kids’ content and product initiatives. We
also use research and surveys to make sure our content
resonates with different age groups.
In 2020, we will expand our annual survey that focuses
on the streaming service requirements of kids and their
parents. We will also establish additional focus groups for
our kids’ original content.
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M6
M7
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OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share The share
The NENT Group share
From listing on Nasdaq Stockholm on 28 March, 2019 to year end, our share
price increased by 38%, compared to 16% for the OMX Stockholm All Share
Index (OMXSPI) and 9% for STOXX Europe Media Index.
Share price development 28 March – 31 December 2019
SEK
350
300
250
200
150
42
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Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
NENT B
OMX Stockholm All Share Index
STOXX Europe Media Index
Share price performance and total return
NENT Group’s shares were listed on Nasdaq Stockholm’s
Large Cap list under the symbols ‘NENT A’ and ‘NENT B’ on
28 March 2019. The share price at the end of the first day
of trading was SEK 219.4 for the B share. The price of NENT
Group’s B share increased by 38% from the listing and
ended the year at SEK 302.8, corresponding to a market
capitalisation of SEK 20.4 billion. The parent company
paid an ordinary dividend of SEK 6.50 per share to share-
holders in 2019, resulting in a total shareholder return of
41% since listing. The corresponding performance for the
OMX Stockholm Return Index (OMXGI) was 20% for the
same period.
Dividend and dividend policy
The Board of Directors is not proposing the payment of a
cash dividend for 2019. This is due to the uncertainty
caused by the spread of the Coronavirus, and its impact
on the operating performance and financial position of
the Company.
NENT Group's dividend policy to distribute an annual
cash dividend of between 30% and 50% of adjusted net
profit remains unchanged for future years.
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Shares and share capital
The Group’s share capital amounted to SEK 135m at the
end of the year.
The total number of issued shares at the end of 2019
was 67,342,244, comprising 545,662 Class A shares
and 66,796,582 Class B shares. The quota value is SEK
2.00 per share.
Class A
shares
Class B
shares
Total
Issued shares as of
31 December 2019
545,662
66,796,582
67,342,244
Voting rights
Each Class A share is entitled to 10 voting rights. Each Class
B share is entitled to one voting right.
Ownership structure
The total number of shareholders according to the
share register held by Euroclear Sweden AB (Swedish
Securities Centre) was 60,270 at the end of 2019. The
shares held by the 10 largest shareholders corresponded
to approximately 47% of the share capital and 45% of
the voting rights. Swedish institutions and mutual funds
owned approximately 30% of the share capital, inter-
national investors owned approximately 50% and
Swedish private investors owned approximately 11%.
Other/ anonymous ownership was 9%.
The share
Share information
Marketplace
Ticker
ISIN code (A share)
ISIN code (B share)
Market cap as of 31 December 2019
Share price as of 31 December 2019
Share price development
28 March–31 December 2019
Highest closing price during the year
Lowest closing price during the year
Nasdaq Stockholm, Large Cap segment
NENT A, NENT B
SE0012324226
SE0012116390
20.4 SEK bn
303 SEK
38%
308 SEK
214 SEK
Analysts covering NENT Group
Company
Carnegie
Citi
DNB
Handelsbanken
Kepler Cheuvreux
Morgan Stanley
Nordea
SEB
Name
E-mail
Mikael Laséen
mikael.laseen@carnegie.se
Thomas Singlehurst
thomas.singlehurst@citi.com
Martin Arnell
Fredrik Olsson
Stefan Billing
Omar Sheikh
martin.arnell@dnb.se
frol16@handelsbanken.se
sbilling@keplercheuvreux.com
omar.sheikh@morganstanley.com
Erik Lindholm-Röjestål
erik.lindholm-rojestal@nordea.com
Johanna Ahlqvist
johanna.ahlqvist@seb.se
43
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share The share
Share buy-backs
The 2019 Annual General Meeting resolved to authorise
the Board to (i) issue at most 500,000 own Class C shares
and (ii) to resolve to repurchase own Class C shares. Class
C shares held by the company should be convertible to
B-shares, when so decided by the Board, in order to carry
out the resolutions regarding the delivery of shares to
participants in the LTIP 2019. The Board resolved to issue
and repurchase 500,000 class C shares after the report-
ing period. There were no Class C shares issued in 2019.
Share related long-term incentive plans
If all share awards granted to senior executives and key
employees as of 31 December 2019 were exercised and
all shares awarded, the outstanding shares of the Com-
pany would increase by 332,902 Class B shares and be
equivalent to a dilution of 0.49% of the capital and 0.46%
of the related voting rights as at the end of 2019. Further
details about the programmes can be found in note 7.
Outstanding share rights granted
LTIP 2019
332,902
Reclassifications
According to the Articles of Association, owners of Class A
shares are entitled to conversion to Class B shares. In 2019,
no Class A shares were converted to Class B shares. More
information can be found in the Articles of Association on
www.nentgroup.com.
Shareholders by geography
Name
Class A Shares
Class B Shares
Total
Capital
Shareholders as of 31 December 2019
Sweden, 42%
United States, 16%
United Kingdom, 15%
Norway, 11%
Others, 10%
Anonymous
ownership, 6%
Norges Bank
Swedbank Robur Funds
Nordea Funds
TimesSquare Capital Management
Marathon Asset Management
Handelsbanken Funds
Lannebo Funds
Vanguard
Skandia Life
Lansdowne Partners
Other
Total outstanding shares
6,284,117
5,168,112
4,511,659
3,286,302
2,671,473
2,190,000
1,888,285
1,873,955
1,621,036
1,676,085
35,625,558
66,796,582
6,284,117
5,168,112
4,511,659
3,286,302
2,671,473
2,190,000
1,888,285
1,873,955
1,780,351
1,676,085
36,011,905
67,342,244
9.3%
7.7%
6.7%
4.9%
4.0%
3.3%
2.8%
2.8%
2.6%
2.5%
53.5%
100%
159,315
386,347
545,662
Source: Euroclear and Modular Finance. The table may reflect aggregate shareholdings of each shareholder.
Votes
8.7%
7.2%
6.2%
4.5%
3.7%
3.0%
2.6%
2.6%
4.4%
2.3%
54.7%
100%
44
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Governance
report
Content
Governance and responsibility
Internal control report
Board of Directors
Group Executive management
Risks and risk management
Auditor’s report on the corporate
governance statement
46
50
51
53
55
58
45
Governance and responsibility
Corporate Governance
Corporate Governance in Nordic Entertainment Group
AB (“NENT Group”) is based on Swedish legislation,
the Rulebook for Issuer’s on Nasdaq Stockholm and the
Swedish Code of Corporate Governance (the “Code”),
see www.corporategovernanceboard.se. During 2019,
NENT Group has been compliant with the Code and
the Rule Book for Issuers on Nasdaq Stockholm and the
generally accepted principles in the securities market.
Shareholders
For information about the ownership structure, share
capital and the NENT Group share, please refer to the
Section “The NENT Group share” on pages 42–44.
Information regularly provided to shareholders includes
interim reports and full year reports, Annual Reports and
press releases on significant events occurring during the
year. All reports, press releases and other information
can be found at www.nentgroup.com.
Annual General Meeting
The Swedish Companies Act (2005:551) (the “Swedish
Companies Act”) and the Articles of Association deter-
mine how the notice to the Annual General Meeting and
extraordinary general meetings shall occur, and who
has the right to participate in and vote at the meeting.
There are no restrictions on the number of votes each
shareholder may cast at the general meeting.
Class A shares entitle to ten votes, whereas Class B
shares entitle to one vote. Distance participation and
voting at the general meeting is not possible.
For information on authorisations approved by the
Annual General Meeting for the Board to resolve on
share buy-backs, please refer to the Section “The NENT
Group share” on pages 42–44.
The Nomination Committee
The Nomination Committee consists of representatives of
some of NENT Group’s largest shareholders, and its
responsibilities include:
• To evaluate the Board of Directors’ work and composition
• To submit proposals to the Annual General Meeting
regarding the election of the Board of Directors and the
Chairman of the Board
• To prepare proposals regarding the election of Auditors
in cooperation with the Audit Committee (when appro-
priate)
• To prepare proposals regarding the fees to be paid to
the Board of Directors and to the Company’s Auditors
• To prepare proposals for the Chairman of the Annual
General Meeting
• To prepare proposals for the administration and order
of appointment of the Nomination Committee for the
Annual General Meeting
In accordance with the resolution of the 2019 Annual
General Meeting of NENT Group shareholders, the Chair-
man of the NENT Group Board of Directors has convened
a Nomination Committee to prepare proposals for the
2020 Annual General Meeting.
The Nomination Committee comprises David Chance,
Chairman of the NENT Group Board of Directors; Erik
Durhan, appointed by Nordea Funds;Joachim Spetz,
appointed by Swedbank Robur Funds; and Oskar Börjes-
son, appointed by Skandia Life. The three shareholders
who have appointed representatives to the Nomination
Committee hold approximately 18 percent of the total
voting rights in NENT Group. The members of the Nomina-
tion Committee appointed Erik Durhan as Committee
Chairman at their first meeting.
Information about how shareholders can submit propos-
als to the Nomination Committee has been published on
https://www.nentgroup.com/about/corporate-governance/
nomination-committee, where the Nomination Committee’s
motivated statement re gard ing its proposal to the Annual
General Meeting and a brief presentation of its work will
also be published well in advance of the Annual General
Meeting on 19 May 2020.
In its work, the Nomination Committee applies Section
III, 4.1 of the Swedish Corporate Governance Code as its
diversity policy. Accordingly, the Nomination Committee
gives particular consideration to the importance of an
increased diversity on the Board, including gender, age
and nationality, as well as depth of experiences, profes-
sional backgrounds and business disciplines. Further
information may be found in the Nomination Committee’s
motivated statement regarding the proposal for the
Board which was given in connection with the 2019
Annual General Meeting.
The Board of Directors
Board members are elected at the Annual General
Meeting for a period ending at the close of the next
Annual General Meeting. The Articles of Association
contains no restrictions pertaining to the eligibility of
Board members. According to the Articles of Association,
the number of Board members can be no less than three
and no more than nine members as elected at the
Annual General Meeting.
46
GRI 102-24
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share The Board of Directors of Nordic Entertainment Group
AB has during the year comprised six Non-Executive
Directors. The members of the Board of Directors were
David Chance, Simon Duffy, Natalie Tydeman, Kristina
Schauman, Anders Borg, and Henrik Clausen, who were
all elected at NENT Group’s first Annual General Meeting
in 2019. In 2019, the Board of NENT Group complied with
the Code’s provision that the majority of members shall
be independent in relation to the company and its
manage ment, and that at least two of them also shall
be independent in relation to the company’s major
shareholders (i.e. those with a holding exceeding 10%).
Biographical information on each Board member is
provided on pages 51–52.
Responsibilities and Duties of
the Board of Directors
NENT Group’s Board of Directors is responsible for the
overall strategy of the Group and for organising its admin-
istration in accordance with the Swedish Companies Act.
The Board’s work and delegation procedures, instruc-
tions for the Chief Executive Officer, and reporting instruc-
tions are updated and approved at least annually.
A Remuneration Committee and an Audit Committee
have been established within the Board. These committees
are preparatory bodies of the Board and do not reduce
the Board’s overall responsibility for the governance of
the Company and decisions taken.
The work of the Board
During the year, the Board of Directors held fourteen
Board meetings. Prior to each ordinary Board meeting,
the members receive a written agenda, based on the
Board’s established rules of procedure, and a complete
set of documents for information and decision-making.
Recurring items include the company’s financial results
and position, the market situation, investments and
adoption of the financial statements. Reports from the
Audit and Remuneration Committees, as well as reports
on internal control and financing activities are also regu-
larly addressed. The Chief Executive Officer presents mat-
ters for discussion at the meetings, and the Company’s
Chief Financial Officer and other members of manage-
ment also participate and present specific matters. The
Group General Counsel is the Board secretary.
The attendance of Board members at Board and com-
mittee meetings is presented in the table on page 52.
Important issues addressed during the year include stra-
tegic issues, with a particular focus on structural changes
(such as the completion of the distribution of shares and
the listing of Nordic Entertainment Group on Nasdaq Stock-
holm, the decision to create a joint venture between Viasat
Consumer and Canal Digital, and the implementation of
NENT Group’s new organisation and operating model).
Ensuring Quality in Financial Reporting
The reporting instructions approved annually by the
Board include detailed instructions on the type of financial
reports and similar information which are to be submitted
to the Board. In addition to the interim reports, the year-
end and the annual report, the Board reviews and evalu-
ates comprehensive financial information regarding the
Group as a whole and the entities within the Group.
The Board also reviews, primarily through the Audit
Committee, the most important accounting principles
applied by the Group in financial reporting, as well as major
changes in these principles. The tasks of the Audit Committee
also include reviewing reports regarding internal control
and financial reporting processes, as well as internal audit
reports submitted by the Group’s internal audit function. The
Group’s external auditors report to the Board as necessary.
The external auditor also attends the meetings of the Audit
Committee. Minutes are taken at all meetings and are
made available to all Board members and to the auditor.
Evaluation of the Board of Directors
and the Chief Executive Officer
The Board complies with an annual performance review
process to assess how well the Board, its committees and
processes are functioning and how they might be
improved.
The review focus on whether the Board is adding value
to the organisation and on enhancing its performance
through examination of Board structure and composition,
its operation and effectiveness, and its role in monitoring
the execution of agreed strategies. The survey also in-
cludes an individual performance review. Answer options
include both a quantitative ranking system as well as an
opportunity to provide any relevant comments, particu-
larly in relation to ideas for improvement. At the Q4 Board
Meeting the Chairman provides the full Board with a
report of the outcome of the Board evaluation process.
A summary is also presented by the Chairman and dis-
cussed with the Nomination Committee.
In addition, a more extensive Board evaluation will
be undertaken either by an independent Board member
or an external consultant at least every three years.
NENT Group is planning to carry out an extensive board
evaluation in the year 2020.
Remuneration Committee
During the year, the Remuneration Committee comprised
Natalie Tydeman as Chairman, David Chance, and Henrik
Clausen. The Remuneration Committee’s assignments
are stipulated in Section III, 9.1 of the Code, and comprise
issues concerning salaries, pension terms and conditions,
incentive programs and other conditions of employment
for the senior executives. The guidelines applied by the
Group in 2019 are presented in note 7 for the Group.
Minutes are kept at the Remuneration Committee’s meet-
ings and are reported to the Board at its next meeting.
GRI 102-22
GRI 102-25
47
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsThe shareSustainability reporting Audit Committee
During the year, the Audit Committee comprised Simon
Duffy as Chairman, Kristina Schauman and Anders Borg.
The Audit Committee’s assignments are stipulated in
Chapter 8, Section 49b of the Swedish Companies Act.
The Audit Committee’s tasks include monitoring NENT
Group financial reporting and the efficiency of NENT
Group internal controls and internal audits, as well as
main taining frequent contacts with the external and inter-
nal auditors. The Audit Committee’s work primarily focuses
on the quality and accuracy of the Group’s financial
accounting and the accompanying reporting, as well as
the internal financial controls within NENT Group. Further-
more, the Audit Committee evaluates the auditors’ work,
qualifications and independence. The Audit Committee
monitors the development of relevant accounting policies
and requirements, discusses other significant issues con-
nected with NENT Group financial reporting and reports
its observations to the Board. Minutes are kept at the Audit
Committee’s meetings and are reported to the Board at
its next meeting.
Remuneration of Board Members
The remuneration to the Board members for Board work,
and work in the committees of the Board, is proposed by
the Nomination Committee and approved by the Annual
General Meeting. The Nomination Committee proposal is
based on benchmarking of peer group company compen-
sation and company size. Information on the remuneration
to Board members is provided in note 7. Board members
do not participate in the Group’s incentive plans.
and was previously MTG’s external auditor since 1997.
Joakim Thilstedt, Authorised Public Accountant, has been
responsible for the audit on behalf of KPMG of NENT Group
since the listing and for MTG since December 2013. Audit
assignments have involved the examination of the Annual
Report and financial accounting, the administration by
the Board and the CEO, other tasks related to the duties
of a company auditor, and consultation or other services
that may result from observations noted during such
examination or the implementation of such other tasks.
All other tasks are defined as other assignments.
The auditor reports its findings to the shareholders by
means of the auditors’ report, which is presented to the
Annual General Meeting. In addition, the auditors’ report
detailed findings at each of the ordinary meetings of the
Audit Committee and to the full Board as necessary.
KPMG provided certain additional services in 2019. These
services comprised work in relation to the split of MTG and
Nordic Entertainment Group, tax compliance work, advice
on accounting issues, and advice on processes and internal
controls and other assignments of a similar kind and closely
related to the auditing process. For more detailed informa-
tion concerning the auditors’ fees, see note 27.
Pre-approval of Policies and Procedures for
Non-audit related Services
In order to ensure the auditor’s independence, the Audit
Committee has established pre-approval policies and
procedures for non-audit related services to be performed
by the external auditor. The policy was approved in
November 2019 by the Audit Committee.
External Auditors
KPMG was elected as NENT Group’s auditor for the finan-
cial year 2019 for a term-of-office ending at the end of
the 2020 Annual General Meeting. KPMG was chosen as
the Group’s external auditor in connection with the listing
Executive Management
At year-end of 2019, the members of the Executive
Management in NENT Group included Chief Executive
Officer Anders Jensen, Chief Financial Officer Gabriel
Catrina and six other members. Biographical information,
including shareholding as of 31 December 2019, on each
member of the Group Executive Management is provided
on pages 53–54.
Chief Executive Officer
The CEO is responsible for the ongoing management of
the Company in accordance with the instructions estab-
lished by the Board.
In consultation with the Chairman of the Board, the CEO
prepares the information and documentation required
as a basis for the work of the Board and in order to enable
Board members to make well-informed decisions. The CEO
is supported by the Executive Management team.
The Board evaluates the performance of the CEO on a
regular basis. The Board also holds a meeting to evaluate
the CEO’s performance, without the attendance of the
CEO or any other member of management. The CEO
and the Executive Management, supported by the various
employee functions, are responsible for the adherence
to the Group’s overall strategy, financial and business con-
trol, financing, capital structure, risk management and
acquisitions. Among other tasks, this includes preparation
of financial reports information to and communication
with the stock market. NENT Group has established a
Steering Document Framework consisting of Codes of
Conduct, Group policies, and directives, expressing our
values and commitment to conduct business in full compli-
ance with laws and regulations, international initiatives
and standards.
48
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Sustainability Governance
NENT Group’s sustainability work is a central part of the
company’s business and governance. It is based upon our
purpose, values, culture and business strategy and includes
our sustainability strategy, policy framework and initia-
tives. Reporting is conducted in accordance with the core
level of the GRI standards, and is reviewed and approved
by the Board of Directors. Responsibility for the overarch-
ing sustainability strategy, goals, actions and follow-up
rests with the Head of Sustainability and the Board of
Directors. The Board monitors the work through regular
updates from the Head of Sustainability (at least twice
a year), which also includes information on sustainability
trends, risks and developments. For integrated work,
the functions and individual entities in the group have
operational responsibility for implementing and meeting
relevant goals and targets. In addition, working groups
have been established for driving improvement across
the business and markets. Progress in the sustainability
work is reported as an integrated part of the Annual
and Sustainability Report 2019.
Executive remuneration
The existing guidelines for remuneration to senior execu-
tives approved at the 2019 Annual General Meeting, as
well as information regarding the application of, and the
deviations from, the existing guidelines and remuneration
for the senior executives paid out during 2019, can be
found in note 7 for the Group. Senior executives covered
by these guidelines include the members of Group Execu-
tive Management.
Proposal for 2020 executive
remuneration guidelines
The Board’s proposed guidelines for determining remuner-
ation to the CEO and other members of Group Executive
Management (the “GEM members”) can be found in the
Administration report on pages 64–66.
Governance structure
Nomination
Committee
Shareholders
Annual General
Meeting
Board of
Directors
Chief Executive
Officer
Executive
Management
External
Auditors
Remuneration
Committee
Audit
Committee
Internal
Auditors
GRI 102-18
GRI 102-20
GRI 102-26
GRI 102-27
GRI 102-31
GRI 102-32
GRI 102-35
GRI 102-36
49
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsThe shareSustainability reporting Internal control report
The processes for internal control, risk assessment, control activities, information and communication, and monitoring regarding
the financial reporting are designed to ensure reliable overall financial reporting and external financial statements in accordance
with International Financial Reporting Standards, applicable laws and regulations and other requirements for listed companies
on Nasdaq Stockholm. This process involves the Board, Executive Management and other personnel.
Control environment
The Board has specified a set of instructions and working
processes regarding the roles and responsibilities of the
Chief Executive Officer and the Board committees. The
Board also has a number of established basic guidelines,
which are important for its work on internal control activi-
ties. This includes monitoring performance against plans
and prior years. The Audit Committee assists the Board in
overseeing various issues such as monitoring internal audit
and establishing accounting policies applied by the
Group.
The responsibility for maintaining an effective control
environment and internal control over financial reporting
is delegated to the Chief Executive Officer. Other Execu-
tive Managers at various levels have respective responsi-
bilities. The Executive Management regularly reports to
the Board according to established routines and in addi-
tion to the Audit Committee’s reports. Defined responsi-
bilities, instructions, guidelines, manuals and policies
together with laws and regulations form the control
environ ment. All employees are accountable for com-
pliance with these guidelines.
Risk assessment and control activities
The Company has prepared a model for assessing risks
in all segments in which a number of items are identified
and analysed. These risks are reviewed regularly by the
Board of Directors and by the Audit Committee, and
include both the risk of losing assets as well as irregulari-
ties and fraud. The process involves all Group companies,
segments and business units. Overall coordination is con-
ducted centrally by the Group’s Risk Management func-
tion. In addition, a Risk Committee comprising Group top
management representatives is tasked with providing
a group-wide overview and a basis for decision-making
regarding risk management. Risk management is per-
formed through an appropriate balance between pre-
ventive and risk-reducing measures. The most important
aspects are regulation compliance, license requirements,
legal change, information and IT security, political and
economic risks. The respective managers are in charge
of risk management in the Group’s companies, segments
and business units. The responsibility encompasses the day-
to-day work focused on operational and other relevant
risks, and on leading risk management activities in their
own areas of responsibility. The managers are supported
by central Group functions.
Information and communication
Guidelines used in the Company’s financial reporting
are updated and communicated to the employees con-
cerned on an ongoing basis. There are formal as well as
informal information channels to the Executive Manage-
ment and to the Board of Directors for information from
the employees identified as significant. Guidelines for
external communication ensure that the Company
applies the highest standards for providing accurate
information to the capital markets.
Follow-up
The Board of Directors regularly evaluates the informa-
tion provided by the Executive Management and the
Audit Committee. The Board receives regular updates
of the Group’s development between the meetings. The
Group’s financial position, strategies and investments are
discussed at every Board meeting. The Audit Committee
reviews the quarterly reports prior to publication. The
Audit Committee is also responsible for following up on
internal control activities. This work includes ensuring that
measures are taken to deal with any inaccuracy and
following up suggestions for actions emerging from the
internal and external audits.
The Company has an independent internal audit func-
tion responsible for the evaluation of risk management
and internal control activities. This work includes scrutinis-
ing the application of established routines and guidelines.
The internal audit function plans its work in cooperation
with the Audit Committee and reports the result of its
reviews to the Audit Committee. The external auditors
report to the Audit Committee at each ordinary meeting
of the Committee.
50
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Board of Directors
David Chance
Chairman of the Board
American and British, born 1957. Elected September 2018
David was Deputy Managing Director of the BSkyB Group between
1993 and 1998, and has also served as a Non- Executive Director of ITV
plc and O2 plc. David is also Chairman of Modern Times Group MTG AB,
a Non-Executive Director of PCCW Limited (Hong Kong) and Chairman of
its NOW TV media group. David has a BA in Psychology, BSc in Industrial
Relations and an MBA from the University of North Carolina.
• Member of the Remuneration Committee.
• Independent of the Company and management and independent of major shareholders.
Direct or related person ownership: 3,565 Class B shares
Natalie Tydeman
Non-Executive Director
British, born 1971. Elected July 2018
Natalie is a private equity investor at v t partners. She was previously a
Senior Partner at GMT Communications Partners. Natalie helped launch
Excite in Europe, built Discovery Communications’ European internet
operations, was Managing Director of Fox Kids Europe’s Online & Inter-
active division and was Senior Vice President at Fremantle Media. Natalie
is also a Non-Executive Director of Modern Times Group MTG AB and
a Trustee of Nesta, where she chairs the Venture Investment Committee and Nesta Investment
Manage ment. Natalie is a graduate of the University of Oxford and Harvard Business School.
• Chairman of the Remuneration Committee.
• Independent of the Company and management and independent of the major shareholders.
Direct or related person ownership: 0 Class B shares
Anders Borg
Non-Executive Director
Swedish, born 1968. Elected September 2018
Anders was Sweden’s Minister of Finance from 2006 to 2014. Anders is
also Chairman of Sehlhall Fastigheter AB’s Board of Directors and a
member of the Board of Directors of Stena International, Rud-Pedersen
Group, as well as senior advisor to IPsoft, Amundi, Kinnevik, Nordic Capital
and East Capital. Anders has served on the Boards of a number of com-
panies in the telecommunication, fintech and public administration sec-
tors. Anders has previously worked for Citigroup, ABN AMRO, SEB, Alfred Berg, Tele2 and Millicom
and has been an active member of the World Economic Forum for many years. Anders’ educa-
tional background is in economics, economic history, political science and philosophy from the
universities of Stockholm and Uppsala.
Simon Duffy
Non-Executive Director
British, born 1949. Elected July 2018
Simon has been Executive Chairman of Tradus plc and Executive
Vice-Chairman of ntl:Telewest, having joined ntl in 2003 as CEO. Simon
has also served as CFO of Orange SA, CEO of End2End AS, and CEO
and Deputy Chairman of WorldOnline International BV, and has held
senior positions at EMI Group plc and Guinness plc. Simon has also been
Chairman of Bwinparty digital entertainment plc and Mblox Inc and
a Non- Executive Director of Millicom International Cellular and Avito AB. Simon is Non-Executive
Chairman of YouView TV Ltd and Telit Communications Plc,, as well as a Non-Executive Director of
Wizz Air Holdings Plc and Modern Times Group MTG AB. Simon holds a Masters from the University
of Oxford and an MBA from Harvard Business School.
• Member of the Audit Committee.
• Independent of the Company and management and independent of the major shareholders.
• Chairman of the Audit Committee.
• Independent of the Company and management and independent of the major shareholders.
Direct or related person ownership: 5,238 Class B shares
Direct or related person ownership: 1,750 Class B shares
GRI 102-23
51
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsThe shareSustainability reporting Kristina Schauman
Non-Executive Director
Swedish, born 1965. Elected September 2018
Kristina is a partner and owner of Calea AB and was a Board member
of Apoteket AB from 2009–2018, including a period as acting CEO
and CFO. Kristina previously served as CFO of Carnegie Investment Bank
AB and OMX AB, and held finance roles at Investor AB, ABB and Stora
Finance. Kristina is a Board member of Coor Service Management
Holding AB, BillerudKorsnäs AB, ÅF Pöyry AB, BEWiSynbra Group AB and
Diaverum AB. Kristina holds a degree in Business Administration and Economics from Stockholm
School of Economics.
Henrik Clausen
Non-Executive Director
Danish, born 1963. Elected September 2018, resigned February 2020
Henrik has been President & CEO of Bang Olufsen, EVP of Strategy
& Digital for Telenor Group, CEO of Malaysia listed Digi, CEO of
Tele nor Denmark and CEO of Cybercity. Henrik previously worked
at Aarsø Nielsen & Partners, A.T. Kearney and Accenture. He is also
a member of the Board of Directors of the Technical University of
Denmark. Henrik holds a Masters in Electrical Engineering from the
Technical University of Denmark, a degree in International Trade from Copenhagen Business
School and an MBA from INSEAD.
• Member of the Audit Committee.
• Independent of the Company and management and independent of the major shareholders.
• Member of the Remuneration Committee.until resignation.
• Independent of the Company and management and independent of the major shareholders.
Direct or related person ownership: 3,000 Class B shares
Direct or related person ownership: 1,330 Class B shares
Board of Directors and attendance at Board and Committee meetings 2019
Board of Directors
David Chance
Simon Duffy
Anders Borg
Henrik Clausen
Natalie Tydeman
Kristina Schauman
Board meeting
attendance1)
Audit Committee
attendance2)
Remuneration
Committee attendance3)
Independent of
major shareholders
Independent of company
and its management
14/14
14/14
14/14
12/14
12/14
13/14
–
6/6
5/6
–
–
6/6
5/5
–
–
4/5
5/5
–
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
1) The total number of meetings during 2019 were fourteen, of which seven were held prior to the Annual General Meeting held on 22 May 2019 and seven were held following the 2019 Annual General Meeting.
2) The total number of Audit Committee meetings during 2019 were six, of which two were held prior to the Annual General Meeting held on 22 May 2019 and four were held following the 2019 Annual General Meeting.
3) The total number of Remuneration Committee meetings during 2019 were five, of which two were held prior to the Annual General Meeting held on 22 May 2019 and three were held following the 2019 Annual General Meeting.
All shareholdings reported as per 31 December 2019.
52
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Group Executive management
Anders Jensen
President & CEO
Swedish, born 1969
Anders was appointed President and CEO on 23 March 2018. He was
previously EVP & CEO of Nordic Entertainment at MTG, having joined
the company in 2014. His earlier roles include Senior EVP and CEO of
the consumer division at TDC Group; CEO of Telenor Hungary; CEO
of Grameenphone in Bangladesh; and Chief Marketing Officer of
Vodafone/Telenor in Sweden. Anders is a board member of the
Los Angeles-based studio Picture start.
Direct or related person ownership: 31,507 Class B shares
Filippa Wallestam
EVP & Chief Content Officer
Swedish, born 1983
Filippa was appointed EVP and Chief Content Officer on 1 October 2019.
Prior to that, Filippa was EVP and CEO of NENT Group Sweden. Filippa
joined MTG in June 2014 as Head of Strategy for free-TV and radio in
Sweden, Norway and Denmark. She previously worked at Boston Con-
sulting Group in London and New York, and at Daily Mail General Trust.
Filippa holds an MSc in Economics and Business Administration from
Stockholm School of Economics.
Gabriel Catrina
EVP & Chief Financial Officer and Head of Strategy & M&A
Argentinian, born 1974
Gabriel was appointed CFO on 29 May 2018, a role he combines with
his position as EVP, Head of Strategy & M&A. He joined MTG in 2013 and
was previously Chief Strategy Officer. His earlier roles include Head of
Booz & Company’s Media, Communic ations and Technology Practice
in the Nordic region; CFO and COO of Educ.ar; and VP of Business
Development, Europe & Latin America, for TCS. Gabriel has an MBA
from Stockholm School of Economics and an MSc in Business Administra-
tion from UCC in Argentina.
Direct or related person ownership: 11,203 Class B shares
Kaj af Kleen
EVP & Chief Technology & Product Officer
Swedish, born 1982
Kaj was appointed EVP and Chief Technology & Product Officer on
1 October 2019. His previous positions include SVP and Group Chief
Techno logy & Product Officer and CTO of Viaplay. Kaj joined the
company as a Management Trainee in 2007 and he is a board
member of Soundation. Kaj holds a Masters in Industrial Engineering
from Luleå University of Technology and an MBA from the University
of Oxford.
Direct or related person ownership: 3,121 Class B shares
Direct or related person ownership: 4,009 Class B shares
53
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsThe shareSustainability reporting Kim Poder
EVP & Chief Commercial Officer
Danish, born 1968
Kim was appointed EVP and Chief Commercial Officer on 1 October 2019.
Prior to that, Kim was EVP and Group Chief Commercial Officer and CEO
of NENT Group Denmark. Kim joined MTG in 1999 and has held positions
including CEO of Viasat Denmark and Finland, CEO of TV3 -Denmark and
CEO of MTG Denmark. Kim was previously Media Director at Omnicom
Media Direction and a Media Analyst at Gallup. He holds a Masters in
Economics and Business Administration from Copenhagen Business School.
Matthew Hooper
EVP & Chief Corporate Affairs Officer
British, born 1970
Matthew was appointed EVP and Chief Corporate Affairs Officer on
1 October 2019. He was previously EVP and Group Head of Corporate
Affairs and CEO of NENT Group UK. Before that, he served as EVP and
Head of Corporate Communications at MTG. Prior to joining MTG in 2011,
Matthew was a co- founder and Managing Partner of Shared Value
Limited, and a Board Director of Shandwick Consultants Limited.
Matthew is a Masters graduate of the University of Oxford.
Direct or related person ownership: 12,126 Class B shares
Direct or related person ownership: 20,467 Class B shares
Mia Suazo Eriksson
EVP & Chief Marketing Officer
Swedish, born 1977
Mia was appointed EVP and Chief Marketing Officer on 1 October 2019.
She was previously VP of Marketing & Communications at NENT Group
Sweden. Before joining MTG in 2015, Mia spent 14 years in New York
where she held a range of marketing, production and creative roles
at VIACOM and studied International Marketing at Pace University.
Direct or related person ownership: 68 Class B shares
Sahar Kupersmidt
EVP & Chief People & Culture Officer
Swedish, born 1977
Sahar was appointed EVP and Chief People & Culture Officer on
1 October 2019. She joined MTG in 2007 and has held several leadership
roles including SVP and Head of Nordic DTH TV. She was a member of
Viasat Sweden’s leadership team from 2012–2018 and MTG Sweden’s
leadership team from 2015–2018. Sahar is the sponsor of NENT Group’s
Challengers talent program and in 2018 was named Female Role Model
of the Year at Sweden’s Telekomgala industry awards.
Direct or related person ownership: 1,078 Class B shares
All shareholdings reported as per 31 December 2019.
Other members of Group Executive Management during 2019 From 1 October, NENT Group moved to a new operating model and the new set-up is based on specialities that operate across the Group in areas such as people, sales,
content, marketing and technology. The Executive Management team was reduced from 15 to eight members. The following people were members of General Executive Management during 2019 but were not part of the Group
Executive Management at the year-end: Morten Mogensen, Jakob Mejlhede Andersen, Kim Mikkelsen, Jonas Gustafsson, Mathias Norrback, Alexander Bastin, Jennie Jacobs, Susan Gustafsson, and Vegard Klubbenes Drogseth.
54
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Risks and risk management
Competitive risks
Competition for viewers, subscribers, advertising and dis-
tribution is intense from broadcasters, cable and broad-
band networks, satellite and terrestrial platforms, online
and mobile operators, movie studios and independent
content producers and distributors, video gaming sites
and other media, as well as pirated content. The Compa-
ny’s ability to compete successfully is dependent on a
number of factors, including the ability to adapt to new
technologies and product innovations, to achieve wide-
spread distribution, and to develop quality content and
user communities in a sustainable manner. The Company
currently depends on a number of third-party network
operators for the distribution of programming, which
represents a significant proportion of its revenues.
NENT Group is also increasingly reliant on a wide vari-
ety of technological platforms and could therefore face
the risk of new market entrants, as well as new ways of
distributing content. This could mean significant changes
for the entertainment industry and could potentially
cause disruption to established contracts and negotiation
structures, as well as to business practices, technological
standards for distribution of content, and ways in which
advertising is traded and sold in the online environment.
The increasing shift towards online viewing and platforms
could also potentially make the Group a target for cyber-
attacks, intrusions, disruptions or denials of service.
Economic and political risks
Substantial foreign exchange rate movements can cause
impacts on the Group’s income statements, financial
position and cash flows. NENT Group hedges the main
part of its US dollar denominated contracted outflow
on a 16–36- month forward basis in order to reduce the
impact of short-term currency transaction effects on
the Group’s cost base. The Group’s equity is not hedged.
Tax related risks
NENT Group operates through subsidiaries resident in dif-
ferent jurisdictions. The business is conducted in accord-
ance with NENT Group’s understanding or interpretation
of applicable tax laws, tax treaties, other tax regulations
and requirements from the tax authorities concerned.
Amended laws, agreements and other regulations may
affect the tax position of the Group as well as if the tax
authorities disagree with the Group’s interpretation of
existing tax rules.
Regulatory risks
The Group’s businesses are regulated in many different
jurisdictions. The regimes that regulate the Group’s business
include both European Union and national laws and regu-
lations related to broadcasting, telecommunications, com-
petition (antitrust) and taxation. Changes in such laws and
regulations, particularly in relation to licensing requirements,
access requirements, programming transmission and spec-
trum specifications, consumer protection, taxation or other
aspects of the Group’s business, or those of any of its com-
petitors, could have a materially adverse effect on the
Group’s business, financial condition or operational results.
Current potential changes in EU law that may have
an adverse impact on the Group’s business include the
following:
• During the last European Commission’s (the “Commission”)
mandate from 2015–2019, several legislative initiatives
were passed as part of the Commission’s Digital Single
Market (the “DSM”) strategy. These include the revised
Copyright Directive 2018, the revised Audiovisual Media
Services Directive 2018, the Online Broadcasters’ Directive
2019 and the Geoblocking Regulation 2018. The impact
of these initiatives on the Group’s business activities is
discussed in further detail below.
• In May 2016, as part of the DSM Strategy, the Commission
published a proposal to amend certain provisions of the
Audiovisual Media Services Directive to reflect market,
consumer and technological changes in the 10 years
since the Directive was last updated. The Directive was
finalised in May 2018 and will come into force in October
2020. The new Directive is not likely to pose any significant
risk on the Group’s business activities.
• In September 2016, as part of the DSM Strategy, the
Commission published a proposal for a Regulation on
the exercise of copyright and related rights applicable
to certain online transmissions of broadcasting organi-
sations. The Proposal extends certain principles of the
1993 Satellite and Cable Directive to the online environ-
ment. The Proposal was renamed the “Online Content
Directive” and was finalised by the EU institutions in
February 2019. The Directive could pose a risk to the
Group’s business in its current form, especially provisions
relating to joint liability for “direct injection” transmission
which could result in higher levels of music royalties
being paid.
• On 14 September 2016, the Commission published its
proposal for a Directive on copyright in the Digital Single
Market. This Proposal aims at modernising the copyright
framework dating back to 2001 by allowing wider online
availability of content across the EU, adapting exceptions
and limitations to the digital world, and achieving a well-
55
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsThe shareSustainability reporting functioning DSM. Article 17 of the Directive proposes to
tackle the “investment or value gap” by making online
content sharing service providers liable for copyright
protected content uploaded illegally by its users. Once
implemented, this Article will be positive for the Group’s
business activities as it will strengthen the Group’s content
protection enforcement. The new Copyright Directive
also includes provisions that improve remuneration and
transparency for authors and performers. These pose
a small risk to the Group’s studio/production business.
• EU’s new General Data Protection Regulation entered
into force on 25 May 2018, replacing the EU Data Protec-
tion Directive 95/46/EC. The new regulation has resulted
in changes to how the Group deals with the personal
data of EU citizens. NENT has implemented changes to
its data protection policies, procedures and processes in
order to become compliant with the regulation.
• On 23 June 2016 the UK voted to leave the European
Union. The UK triggered Article 50 of the Treaty on
European Union in March 2017, with an initial deadline
to leave the EU by 31 March 2019. The EU agreed sub-
sequent extensions to the Brexit deadline, and the UK
left the European Union on 31 January 2020. A UK-EU
Withdrawal Agreement was approved and ratified by
both the UK and European Parliament prior to the UK’s
exit, thereby guaranteeing a transition period until
31 December 2020. During this transition period there
is legal status quo in terms of trade between the UK
and EU. Since the audiovisual sector will not be part of
a future trade deal between the UK and the EU, the
Group’s UK (Ofcom) broadcasting licences will no longer
be valid for broadcasting the Group’s TV channels and
VOD services into the EU after the end of the transition
period. In December 2018, the Group’s Board approved
the Group’s Brexit Contingency Plan, which will see the
Group applying for broadcasting licences in Sweden
whilst maintaining its UK operations as they currently
are today.
• On 3 December 2018, the Commission’s Geo-blocking
Regulation came into force and put an end to geo-
graphically based restrictions which would undermine
online shopping and cross-border sales in the Digital
Single Market. The audio-visual industry was excluded
from the scope of the Geo-blocking Regulation but is
specifically included in the “Review Clause” (Article 9).
The Review Clause will be triggered on March 3, 2020.
If the audio-visual industry is included within the Geo-
blocking Regulation, this will have a significant negative
impact on the Group’s streaming and content business.
Financial risk management and financial policy
NENT Group is reliant on access to financing and is there-
fore exposed to risks associated with disruptions in the
financial markets, which could make it more difficult and/
or more expensive to obtain financing in the future. Poten-
tial events affecting this may include the adoption of new
regulations, implementation of recently enacted laws or
new interpretations, or the enforcement of existing laws
and regulations applicable to financial institutions, the
financial markets or the financial services industry, which
could result in a reduction in the amount of available
credit or increases in the cost of credit. The Group’s exist-
ing credit facilities are currently considered sufficient.
The Group’s financial risk management is centralised to
the parent company to capitalise on economies of scale
and synergy effects, as well as to minimise operational
risks. The Group’s financial policy is subject to review and
approval by the Board of Directors and constitutes a
framework of guidelines and rules for financial risk man-
agement and financial activities in general. The Group’s
financial risks are continuously evaluated and monitored
to ensure compliance with the Group’s financial policy.
The exposures are described in note 22.
Foreign exchange risk
Foreign exchange risk is divided into transaction exposure
and translation exposure.
Transaction exposure
Transaction exposure is hedged mainly for unmatched
contracted programme acquisition outflows through
forward exchange agreements based on a maximum
of 36 months forward.
Translation exposure
Translation exposure arises from the conversion of the
Group’s subsidiaries and associated companies’ earnings
and balance sheets into the Swedish krona reporting
currency from other currencies. Since many of the sub-
sidiaries report in currencies other than Swedish krona,
the Group is exposed to exchange rate fluctuations.
Translation exposure is not hedged.
Interest rate risk
NENT Group’s sources of funding are primarily share-
holders’ equity, cash flows from operations and external
borrowing. Interest-bearing debt exposes the Group
to interest rate risk.
56
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Financing and refinancing risk
External borrowing is managed centrally in accordance
with the Group’s financial policies. Loans are primarily
taken up by the parent company and transferred to sub-
sidiaries as internal loans or capital injections. There are
also companies who have external loans and/or over-
draft facilities connected directly to these companies.
The refinancing risk is managed by seeking to diversify
funding sources and maturities, and by typically initiating
the refinancing of all loans 12 months prior to maturity.
Credit risk
The credit risk with respect to NENT Group’s trade receiv-
ables is diversified among a large number of customers,
both private individuals and companies. High credit rat-
ings are required for all material credit sales and solvency
information is obtained to reduce the risk of bad debt.
Insurable risks
The parent company ensures that the Group has sufficient
insurance cover, including business interruption, director
and officer liabilities, and asset losses. This cover comprises
corporate umbrella solutions to cover most territories.
Sustainability risk management
The Company’s sustainability-related risks de scribed in this
report are managed in accordance with NENT Group’s
risk management framework, which is integrated in the
Company’s operational processes. The short and long-
term sustainability goals are aligned with NENT Group’s
sustainability work, risks and mitigating actions. Identifica-
tion of sustainability risks is performed throughout the
year by the sustainability team in stakeholder dialogues,
audits and working processes. NENT Group’s sustainability
risks are followed up in regular updates to the Board of
Directors (at least twice a year) and monitored in the
Governance Risks Compliance (GRC) Committee.
Main sustainability risks include:
• B reach of applicable data privacy protection
regulations
• Illegal access, distribution and consumption of our
content through piracy activities
• Provision of safe and fair work environment
• Application of human rights and labour standards
in the value chain and in productions.
Read more how the Group mitigates these risks in the
sustainability section on pages 29–41.
People and social issues, data protection and human
rights are covered in the sustainability strategy, and
Group policies and directives. Read more on page 37–38
about how NENT Group address risks in these areas, and
implement and follow- up through the governance frame-
work, which also covers prevention of corruption.
NENT Group’s Supplier Code of Conduct outlines the
standards the Group expects from suppliers, and the
Group has a clear goal to address and engage with all
identified high-risk suppliers, to ensure commitment to
the Group’s ethical standards by 2021.
Protecting the Group’s content from piracy activities
is a priority, and managing this risk is structured within
the Information Security Department. NENT Group also
co operate with specialised external organisations such
as the Audio-visual Anti-piracy Alliance and the Nordic
Content Protection body.
Environmental issues are not a principal focus of the
sustainability strategy; however, the Group takes action to
minimise its negative environmental impact. Read more
on page 39.
Covid-19
The outbreak of the Covid-19 virus in China and its subse-
quent pandemic spread to the rest of the world after the
end of the reporting period does constitute a substantial
risk for NENT Group’s people, operations and financial
performance and position. Extensive measures have been
taken to safeguard employees and to ensure the conti-
nuity of the business. The primary risks are to the health
and wellbeing of the workforce and talents, reductions in
advertising spending, the inability to produce program-
ming, the cancellation of events or shows to be shown on
NENT Group’s channels or services that drive subscription
and advertising revenues, the reduction in the value of
NENT Group’s publicly traded securities, and the ability
to raise finance in the capital markets. The human and
economic effects of the very recent pandemic are not
yet known but NENT Group is taking all possible actions to
evaluate and mitigate the risks that are arising, and will
announce the impacts as and when they become clear,
as well as further actions to be taken.
GRI 102-15
GRI 102-30
GRI 102-31
GRI 102-33
57
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsThe shareSustainability reporting Auditor’s report on the
corporate governance statement
To the general meeting of the shareholders
in Nordic Entertainment Group AB,
corporate identity number 559124-6847
Engagement and responsibility
It is the board of directors who is responsible for the
corporate governance statement for the year 2019
on pages 45–57 and that it has been prepared in
accordance with the Annual Accounts Act.
The scope of the audit
Our examination has been conducted in accordance
with FAR’s auditing standard RevU 16 The auditor’s
examination of the corporate governance statement.
This means that our examination of the corporate
governance statement is different and substantially
less in scope than an audit conducted in accordance
with International Standards on Auditing and generally
accepted auditing standards in Sweden. We believe
that the examination has provided us with sufficient
basis for our opinions.
Opinions
A corporate governance statement has been prepared.
Disclosures in accordance with chapter 6 section 6 the
second paragraph points 2–6 the Annual Accounts Act
and chapter 7 section 31 the second paragraph the
same law are consistent with the annual accounts and
the consolidated accounts and are in accordance with
the Annual Accounts Act.
Stockholm 2 April 2020
KPMG AB
Joakim Thilstedt
Authorised Public Accountant and Auditor in Charge
Hök Olov Forsberg
Authorised Public Accountant
58
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Administration
report
Content
Administration report
Business segments
Financial statements
Notes
Signatures
Audit report
Historical overview
Alternative performance
measures
60
67
69
78
118
119
123
124
Administration report
The Board of Directors and President and CEO of Nordic Entertainment Group AB
(publ), with corporate registration number 559124-6847 and registered office in
Stockholm Sweden, hereby submit the annual report and consolidated accounts
for the 2019 financial year.
Operations and market
NENT Group is one of the leading entertainment provid-
ers in the Nordic region. The Group provides broadcast
TV and streaming services in Sweden, Denmark, Norway
and Finland, with satellite pay-TV platforms, TV channels
and video streaming services in each country; commer-
cial free-TV channels in all countries except Finland; com-
mercial radio networks and streaming services in Sweden
and Norway; and a bundled TV and broadband offering
in Sweden. The majority of NENT Group’s broadcasting
and streaming licences are held in the UK, from where it
acquires, and makes editorial decisions regarding, a sub-
stantial proportion of the content for its services.
NENT Group also creates, produces and distributes tele-
vision shows, commercials, feature films and branded con-
tent. The majority of the production business lies within the
NENT Studios, where the Group produces content for
broadcasters, streamers, distributors and advertisers. The
majority of NENT Studios activities are in the Nordic region
but it also operates production companies in other Euro-
pean countries and sells content to customers worldwide.
NENT Group primarily derive revenues from subscrip-
tion fees and the sale of advertising space. Subscription
revenues are derived by offering pay-TV packages and
streaming services direct to consumers for a subscription
fee, or by making these channels and services available in
third party networks in return for a carriage fee or reve-
nue share. Advertising revenues are generated by selling
advertising time and space on TV and radio channels as
well as streaming services.
NENT Group changed to a new organisation and oper-
ating model from 1 October. Instead of a country operat-
ing model the Group is now focused on specialities that
operate across the company in areas such as people,
sales, content, marketing and technology. This led to a
smaller and more focused Group Executive Management
team and also resulted in staff reductions. In 2019, the
Group’s average number of employees was 1,844 (1,724).
As the staff reduction occurred at the end of the year, this
did not affect the Group’s average number of employees.
An exciting year
2019 was an exciting year for NENT Group. The Group
delivered 6% organic sales growth, both business seg-
ments grow its operating profits and the Viaplay sub-
scriber growth, which is the single most important KPI,
accelerated to 25 percent. In the midst of this the Group
launched a new brand, set its new purpose and values,
published the listing prospectus and successfully listed its
shares on Nasdaq Stockholm on 28 March. The listing of
NENT Group followed the decision to split MTG (Modern
Times Group MTG AB (publ)) into two separate companies.
Significant events after the reporting period
Significant events after the reporting period are
described in note 30 on page 116.
60
GRI 102-1
GRI 102-3
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Significant events in 2019 by quarter
Q1
• The formation of a new UK-based
joint venture with FilmNation Enter-
tainment was announced, which will
develop, produce and finance pre-
mium scripted television content for
global audiences.
• New distribution partnerships were
signed with Boxer, YouSee and Stofa.
• Extended its exclusive content
partner ship with NBCUniversal and
also entered into a three-year deal
with Metro Goldwyn Mayer.
• A medium term note programme
was established, enabling NENT
Group to issue notes up to SEK 4bn
to the Swedish capital market.
• On 28 March 2019, NENT Group’s
shares started trading on Nasdaq
Stockholm. This followed the decision
to split MTG into two separate
companies.
Q2
• Acquired the exclusive media
rights to a comprehensive range
of the world’s leading winter
sports competitions. The land-
mark five-year deal secures the
hugely popular FIS Alpine Ski
World Cup and FIS Cross Country
World Cup and much more from
2021.
• Invested in a minority stake in
new US studio Picturestart, which
will create, co-finance and pro-
duce premium scripted content
for young adult viewers around
the world.
• SEK 1.5bn was raised by issuing
3 and 5 year senior unsecured
bonds.
• Extended Nordic rights to Danish
Superliga football to 2024.
• Extended Swedish distribution
agreements with Telia and Tele2.
Q3
• Acquired exclusive rights to the
ISU ice skating for the next four
seasons and women’s football
rights from England, Germany
and France.
• Announced the intention to
launch Viaplay in Iceland in the
first half of 2020.
• Announced a new organisation
and operating model. The new
set-up is based on specialties
that operate across the Group in
areas such as people, sales, con-
tent, marketing and technology.
Q4
• Acquired exclusive Nordic rights to
IIHF Ice Hockey World Championship
from 2024 to 2028.
• Entered into an agreement with Tel-
enor to form a 50/50 joint venture
between Viasat Consumer (satellite
pay-TV and broadband-TV opera-
tions) and Canal Digital (satellite
pay-TV). The combination is expected
to yield annual cost synergies of
approximately SEK 650m and is sub-
ject to regulatory approvals and
expected to be completed during
the first half of 2020.
• Extended Nordic distribution agree-
ments with Telenor.
• Announced the financial effects from
the new organisation and operating
model, including restructuring and
redundancy costs of SEK 190m with
expected saving of approximately
SEK 250m . The Group also announced
write-downs totaling SEK 541m of
content related assets.
• Extended exclusive rights to UFC, the
world’s premier MMA organisation.
GRI 102-10
61
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Financial performance 2019
Net sales
Net sales were up 7.6% to SEK 15,671m (14,568) following
6.4% organic growth and a 1.1% FX contribution.
Operating expenditure before items affecting
comparability
The Group’s operating costs excluding items affecting
comparability increased to SEK 14,126m (13,024). The
increase was driven primarily by the ongoing investment
in digital expansion and Viaplay. Depreciation and amor-
tisation charges increased to SEK –336m (–202), mainly
reflected by amortisation of Right of use assets, the
investments in radio licenses in Sweden and the Viaplay
and Viafree platforms. Impairment charges amounted to
SEK –7m (–7).
Operating income and items affecting
comparability
Operating income for the combined business segments
increased by 6% to SEK 1,813m (1,706). Operating income
before IAC amounted to SEK 1,545m (1,544). The central
operation costs included initial advisory costs of SEK 24m
related to the proposed Viasat Consumer / Canal Digital
combination. Items affecting comparability amounted to
SEK –787m (–40) and reflected SEK 190m of restructuring
and redundancy costs as well as an write downs of SEK
541m relating to free-TV content and other assets that
have limited remaining value. See note 8 on page 92 for
a comprehensive list of items affecting comparability.
62
Net interest and other financial items
Net interest and other financial items totalled SEK –46m
(–52). Net interest amounted to SEK –37m (–37), of which
SEK –18m (0) related to the interest on net lease liabilities.
Other financial items amounted to SEK –9m (–15) and
mainly comprised the impact of exchange rate differ-
ences on financial items.
Tax
Tax charges amounted to SEK –122m (–160), corresponding
to an effective tax rate of 17% (11).
Net income and earnings per share
Net income totalled SEK 590m (1,292), with basic earnings
per share of SEK 8.77 (19.24) and diluted earnings per share
of SEK 8.74 (19.09).
Financial overview
SEKm
Net sales
Organic growth
Change in reported net sales
Operating income – Business segments
Central operations
Operating income before IAC
Items affecting comparability (IAC)
Operating income
Operating margin before IAC
Operating margin
Net income
Basic earnings per share (SEK)
Net debt
2019
15,671
6.4%
7.6%
1,813
–268
1,545
–787
758
9.9%
4.8%
590
8.77
4,139
2018
14,568
3.8%
6.4%
1,706
–162
1,544
–40
1,504
10.6%
10.3%
1,292
19.24
3,944
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Cash flow
Cash flow from operations
Cash flow from operations before changes in working
capital amounted to SEK 1,393m (1,496). Depreciation,
amortisation and imparment charges totalled SEK –343m
(–208). The Group reported a SEK –791m (–380) change in
working capital, reflecting investments in Viaplay Originals
and higher payments in relation to new and prolonged
sports rights compared to last year. In addition, working
capital increased in NENT Studios resulting from the strong
sales growth in Q2 and Q3 with receipts typically follow-
ing production payments. Net cash flow from operations
totalled SEK 602m (1,116).
Investing activities
Investments in business operations amounted to SEK –15m
(–19). Capital expenditure on tangible and intangible
assets totalled SEK –176m (–550), where last year includ-
ing the impact of the investment in the new Swedish radio
licences. Other investing activities totalled SEK –99m (2).
Total cash flow related to investing activities therefore
amounted to SEK –290m (–567).
Financing activities
Cash flow from financing activities amounted to SEK
475m (–209). New long-term borrowings amounted to
SEK 2,300m (0) and related to a 7-year loan within the
framework of the Group’s MTN program that was used
to replace short-term borrowings. The change in short-
term borrowings of SEK 2,480m (0) reflected the repay-
ment of the financing from MTG.
The net change in cash and cash equivalents amounted
to SEK 787m (339), and the Group had cash and cash
equivalents of SEK 1,238m (428) at the end of the period.
Net debt
The Group’s total net debt position amounted to SEK
4,139m (3,944) at the end of the period, and comprised
financial net debt of SEK 3,542m (3,944) including cash
and cash equivalents of SEK 1,238m (428) net of lease lia-
bilities and sublease receivables of SEK 598m (0).
Parent company
Nordic Entertainment Group AB (publ.) is the Group’s par-
ent company and is responsible for Group-wide manage-
ment, administration and financing. The company was
established during June 2018.
Nordic Entertainment Group AB reported net sales of
SEK 43m (0) in 2019. Net interest and other financial items
totalled SEK 48m (6). Income before tax and appropria-
tions amounted to SEK –210m (–124). Income after tax and
appropriations amounted to SEK 312m (0).
The parent company had cash and cash equivalents of
SEK 974m (0) at the end of the period. At the end of the
reporting period SEK 4,190m (N/A) of the SEK 4,390m total
available credit facilities, including SEK 390m overdraft
facilities, was unutilized.
Share and share capital
At year end, NENT Group’s share capital totalled SEK 135
million (50 thousand). The total numbers of issued NENT
Group shares were 67,342,244 shares, whereof 545,662
class A shares and 66,796,582 class B shares. For more
information, see section “The share” on page 42–44 and
note 18 Shareholders’ equity.
Dividend and proposed appropriation of earnings
The following funds are available for disposal by the
Annual General Meeting:
SEK
Profit brought forward
Net income for the year 2019
Total
2019
1,447,712,000
311,548,568
1,759,260,568
The Board of Directors does not propose the previously
indicated cash dividend of SEK 7.00 per share for 2019 to
the upcoming 2020 Annual General Meeting of share-
holders. The Bord of Directors proposes that the un-ap-
propriated earnings be allocated as follows:
SEK
Carried forward
Total
2019
1,759,260,568
1,759,260,568
63
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Corporate governance report and
sustainability report
In accordance with the Swedish Annual Accounts Act
Ch. 6 § 8 and 11, NENT Group has chosen to prepare the
statutory corporate governance report and sustainability
report separately from the legal annual report. The cor-
porate governance report is provided on page 45–57,
and the sustainability report (including statutory sustaina-
bility report) is provided on page 28–41, 49, 57, 126–150.
Outlook
NENT Group’s mission is to offer its customers the best and
broadest storytelling entertainment experiences that are
relevant, engaging, simple to use, broadly available, and
great value for money.
NENT Group does not provide formal financial perfor-
mance targets or guidance. NENT Group’s objective is
to deliver sustainable profitable growth in the form of
organic sales growth and growth in operating income
before items affecting comparability. This is being
challenged in 2020 by the impact of the spread of the
Corona virus on NENT Group’s operations and market
positions.
NENT Group also intends to maintain its balance sheet
leverage ratio of no more than 2.5x net debt to trailing
twelve month adjusted EBITDA. NENT Group’s leverage
may exceed these levels temporarily from time to time.
NENT Group’s dividend policy is to distribute an annual
cash dividend of between 30% and 50% of adjusted
net income but, due to the effects of the spread of the
Corona virus, the Board will not propose the payment
of a dividend in 2020 for 2019.
Significant risks and uncertainties
How risks are managed is of great significance for the
NENT Group’s success. The risks that could have the great-
est impact on the Group are the various competitive risks
including the Company’s ability to adapt to new technol-
ogies and product innovations, to achieve widespread
distribution, and to develop quality content and user
communities in a sustainable manner.
Other risks with a medium-high potential impact are
economic and political risks, and regulatory risks. NENT
Group’s strategic and operational risks are described
in more detail in section “Risk and risk management” on
pages 55–57, together with the risk management process.
The risks related to the Covid-19 virus for the Group are
also described in this section. NENT Group’s financial risks
are described in note 22 Financial risk and financial risk
management.
Remuneration
Principles for remuneration, fees and other remuneration
paid to the Board of Directors, the President and CEO,
and other members of Group Executive Management as
well as other statistics and the guidelines regarding remu-
neration and benefits to Group Executive Management
as approved by the Annual General Meeting are speci-
fied in note 7.
NENT Remuneration Guidelines 2020
The Remuneration Guidelines (“the guidelines”) will apply
to the President & CEO and members of the Group Execu-
tive Management (“GEM”), currently comprising of seven
members. The guidelines are forward-looking, i.e. they are
applicable to remuneration agreed and amendments to
remuneration already agreed, after the adoption of the
guidelines by the 2020 Annual General Meeting. The
intention of the Board of Directors (“the Board”) and its
Remuneration Committee (“the Committee”) is that the
guidelines will remain in place for four years from the date
of approval. These guidelines do not apply to any remu-
neration decided or approved by the general meeting,
for example share-related long-term incentive plans.
Our approach to remuneration
NENT’s remuneration policy is designed to i) drive and
reward sustainable company and individual performance,
ii) be market competitive to attract and retain best-in-class
talent, and iii) to incentivise the creation of long-term share-
holder value in a rapidly changing industry. Specifically, our
strategic priorities and our vision are reflected in the design
of executive remuneration as set out below:
• Deliver profitable growth: A substantial proportion of
remuneration is variable and linked to our key drivers of
performance. Performance measures in our short- and
long-term incentive plans are carefully selected to pro-
mote growth through stretching and relevant incentive
targets.
• Create long-term shareholder value: Incentive plans are
designed to reward sustainable company performance
and value creation. Resulting outcomes are intended
to reflect shareholder experience and contribute to
increased alignment as executives are required to build
and maintain a significant shareholding in NENT.
• Be the leading Nordic streaming service provider and
content producer with a global appeal: A remuneration
structure and mix that provides agility to quickly adapt
to business needs in a fast-moving industry and highly
competitive talent market.
64
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Remuneration guidelines by element
Total remuneration shall be on market terms and may
include base salary, pension, benefits and perfor-
mance-linked elements in the form of short-term (‘STI’)
and long-term incentive (‘LTI’) plans. The long-term incen-
tive plans are approved by the general meeting and,
while not goverened by these guidelines, are included
in summary form for completeness. The table below
provides more detail on the individual elements, their
purpose and their link to the buisness strategy.
Elements
Purpose and link to strategy
Description and operation
Base salary
To recruit, reward and retain executives
Base salary shall be fair and competitive reflecting the individual executive’s responsibilities, skills and performance.
Pension
To provide local market competitive pension
Benefits and
allowances
To provide local market competitive benefits
and support recruitment and retention
Annual
short-term
incentive
(STI) plan
To incentivise and reward the achievement
of annual financial and, when appropriate,
non-financial performance measures clearly
linked to the strategic priorities and sustainable
development of the Group and the executives’
area of responsibility
Pension arrangements, including health insurance, shall be competitive and appropriate in context of the market practice in the
applicable country of executives’ employment or residence and total remuneration. The pension arrangements shall be provided in
the form of a defined contribution or as a cash allowance and shall amount to not more than 30 per cent of the fixed base salary.
Pension arrangements may evolve year-on-year. Variable cash remuneration shall not qualify for pension benefits.
Benefits shall be competitive and appropriate in context of the market practice in the applicable country of executives’ employ-
ment or residence and total remuneration. Benefits may include but are not limited to car allowance, travel allowance, tax support,
life insurance and medical insurance. Premiums and other costs of such benefits shall constitute a limited proportion of total remu-
neration. Additional benefits may be provided in specific individual situations including changes in individual circumstances such as
health status and changes in roles such as relocation, if considered appropriate. Any resolution on such remuneration shall be made
by the Board based on a proposal from the Committee.
The maximum payment under the STI shall not excced 150% of base salary. The satisfaction of criteria for awarding STI shall be
measured over a period of one year.
The Board approves the corporate performance measures, targets and relative weightings at the start of each year, on recom-
mendation by the Committee. The Board ensures that there is strong alignment with the business strategy and that the targets are
clear and sufficiently stretching. STI’s will also take into account the individual executives’ performance against pre-determined and
measurable objectives within their area of responsibility defined to promote the Group’s sustainable development in the short- and
long-term. Such objectives are agreed with the President & CEO (or, in the case of the President & CEO, the Chairman of the Board)
and may be functional, operational, strategic and non-financial and include, inter alia, objectives relating to environmental, social
and governance issues.
Payment under this plan is made after year-end following the Committee’s and Board’s determination of achievement against
the annual corporate targets and the achievement of annual individual objectives for the President & CEO. The President & CEO
determines the achievement of annual individual objectives for other executives.
The terms for the STI shall be structured so that the Board has the possibility to; (i) limit or refrain from paying variable remunera-
tion, if such payment is considered unreasonable and incompatible with the company’s responsibility in general to the shareholders,
employees and other stakeholders, (ii) to adjust payments before they are made (‘malus’) if special circumstances exist that warrant
this, such as financial misstatement (iii) to claw back payments that have already been made on incorrect grounds and (iv) to adjust
the targets retroactively for extraordinary circumstances.
65
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Elements
Purpose and link to strategy
Description and operation
Long-term
incentive (LTI)
The LTI shall be linked to certain pre-deter-
mined financial and/or share or share-price
related performance criteria and shall ensure
a long-term commitment to the development
of NENT and align the senior executives’
in centives with the interest of shareholders.
Extraordinary
arrangements
To aid recruitment or retention required to
ensure successful implementation of the
company’s strategy and safeguarding its
long-term interests.
The LTI is generally delivered in shares, resolved upon separately by
the general meeting and therefore excluded from these guidelines.
By way of exception, additional one-off arrangements can be made on a case by case basis, when deemed necessary, subject to
Board approval on recommendation from the Committee. Each such arrangement shall be capped at two (2) times the individual’s
annual base salary.
Share
Ownership
Requirement
To ensure that executives build and maintain
a significant shareholding in NENT Group and
are aligned with the interest of shareholders
The President & CEO and members of GEM are required to accumulate NENT shares toward target ownership levels that are
based on a percentage of net base salary. Target ownership levels: President & CEO: 150% and other members of GEM: 75%.
The Committee has the authority to adjust these requirements if considered appropriate in individual cases.
Service contracts and payments upon
termination of employment
In general, executive contracts have indefinite duration.
However, the contracts may be issued on a fixed-term
basis if warranted by certain circumstances, such as for
interim positions or for executives close to retirement
age. Upon termination of employment, the notice period
may not exceed twelve months. Fixed cash salary during
the notice period and any severance pay may combined
not exceed an amount equivalent to two years’ fixed
salary.
In addition, executives may be compensated for non-
compete restrictions invoked post termination. Such com-
pensation shall be based on the base salary at the time
of notice of termination of employment and be awarded
during the restriction period which cannot exceed twelve
months. Such payment cannot be combined with sever-
ance payments.
Remuneration governance and decision-making
The Board has established a Remuneration Committee.
The Committee’s tasks include preparing the Board ‘s
decision on guidelines for executive remuneration. The
Board shall prepare a proposal for new guidelines at
least every four years and submit these to the general
meeting. The guidelines shall be in force until new guide-
lines are adopted by the general meeting. The Com-
mittee shall prepare, for resolution of the Board, remun-
eration-related matters concerning the President & CEO
and any proposals on share-based or share-related
long-term incentive plans in the company. In addition,
the Committee shall monitor and evaluate programs for
variable remuneration for GEM, the application of the
guidelines for executive remuneration as well as the cur-
rent remuneration structures and compensation levels in
the company. In order to avoid any conflict of interest, the
Committee shall consist of non-executive members only.
Remuneration is managed through well-defined processes
ensuring that no individual is involved in the decision-
making process relating to their own remuneration.
Salary and employment terms for the broader
population/company’s employees
In preparing and applying these guidelines, the Committee
considers the pay and conditions elsewhere in the com-
pany, which in turn are informed by general market con-
ditions and internal factors such as the performance of
the Group or relevant business unit. The Committee regu-
larly consults with the President & CEO and HR to be mind-
ful of employee pay, conditions and engagement across
the broader employee population.
Deviation from the guidelines
The Board may temporarily resolve to deviate from the
guidelines, in full or in part, if in a specific case there is
special cause for the deviation and a deviation is neces-
sary to serve the company’s long-term interests, including
its sustainability, or to ensure the company’s financial
viability. As set out above, the Committee’s tasks include
preparing the Board’s resolutions in remuneration-related
matters. This includes any resolutions to deviate from the
guidelines.
66
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Business segments
NENT Group has two reporting segments:
Broadcasting & Streaming and NENT Studios.
Broadcasting & Streaming primarily provides
TV and radio services that are distributed on a
scheduled and on-demand basis, both on NENT
Group’s own and third-party networks and are
funded by advertising and subscription revenues.
The NENT Studios segment creates, produces and
distributes scripted, non-scripted and digital content
for in-house and third-party distribution platforms.
Broadcasting & Streaming
The Broadcasting & Streaming segment comprises pan-
Nordic commercial streaming and satellite TV platforms
and pay-TV channels, as well as free-TV channels in each
of the Scandinavian countries and national radio networks
in Norway and Sweden. Key brands include Viaplay, Viafree,
Viasat, TV3, TV6, RIX FM and P4 Norway. Sweden and
Denmark are the largest markets, and there are also sub-
stantial growth opportunities in Norway and Finland.
Broadcasting & Streaming sales were up 6% (5) on an
organic basis and driven primarily by the continued growth
of Viaplay. Operating expenses were also up and reflec-
ted the ongoing investments in content and technology as
well as the depreciation of the Swedish krona. Operating
income amounted to SEK 1,731m (1,661), with an operating
margin of 12.6% (13.0).
Advertising
Advertising sales, which accounted for 26% of Group
sales, were stable on a reported basis. TV advertising
sales were down slightly as higher prices and audience
shares were offset by lower linear TV viewing levels, as
well as softer advertising markets. NENT Group’s TV audi-
ence shares stable in Sweden and up in Denmark and
Norway but the TV advertising markets are each esti-
mated to have declined. Viafree sales were up and the
service now has 2.6 million registered users and approxi-
mately 4 million downloaded apps across the region.
Radio sales were up as continued growth in the Swedish
business more than offset lower sales for the Norwegian
business. NENT Group’s Swedish radio audience share
increased while the Norwegian share was down. The
Swedish and Norwegian radio advertising markets are
both estimated to have declined.
Subscription & other
Subscription & other sales, which accounted for 61% of
Group sales, were up 10% on a reported basis and driven
by the Viaplay subscriber intake, Swedish broadband-TV
sales and content sublicensing deals. The total subscriber
base was up compared to last year, driven by Viaplay
which added 310k customers to end the year at 1,568k
subscribers. Viaplay now represents 62% (57) of the total
subscriber base. The Viasat direct-to-consumer subscriber
base was down 4k to 489k as continued growth in the
broadband-TV base was offset by the decline in the
satellite base. The third-party subscriber base was up
3k to 469k.
Honour
SEKm
Net sales
of which advertising
of which subscription & other
2019
2018
13,697
4,005
9,691
12,800
4,017
8,783
Operating expenses
–11,966
–11,139
Operating income
Operating margin
Net sales growth
Organic growth
Acquisitions/divestments
Changes in FX rates
1,731
12.6%
1,661
13.0%
7.0%
6.0%
–
1.0%
7.0%
4.5%
–
2.5%
GRI 102-2
GRI 102-6
67
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share NENT Studios
The NENT Studios segment is a leading content creation
and production company in the Nordic region. It comprises
32 production companies in 17 territories and also includes
DRG, which is a leading independent distributor of content,
and Splay One, which is one of the Nordic region’s leading
multi-channel network and next generation digital media
houses. Sales were up 18% (–7) on an organic basis, primarily
driven by exceptional growth in scripted drama productions
for both Viaplay and third-party customers but also from
healthy growth in non-scripted sales as well as for digital
first productions. Operating income amounted to SEK 82m
(45), with an operating margin of 3.6% (2.4).
In January 2020, NENT Group announced the reorgani-
sation of NENT Studios including the intention to divest non-
scripted, branded entertainment and events businesses.
This process has been temporarily paused due to the
impact of the Coronavirus on market conditions.
SEKm
Net sales
Operating expenses
Operating income
Operating margin
Net sales growth
Organic growth
Acquisitions/divestments
Changes in FX rates
2019
2018
2,284
–2,202
1,911
–1,866
82
3.6%
19.5%
17.7%
–
1.8%
45
2.4%
–3.8%
–7.3%
0.1%
3.4%
68
‘Thicker than Water’
produced by NENT Studios’ Nice Drama
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Financial
statements
Content
Consolidated income statement
Consolidated balance sheet
Consolidated statement of changes in equity
Consolidated statement of cash flow
Parent company income statement
Parent company balance sheet
Parent company statement of changes in equity
Parent company cash flow statement
70
7 1
72
73
74
75
76
77
Consolidated income statement
(SEK million)
Net sales
Cost of goods and services
Gross income
Selling expenses
Administrative expenses
Other operating income
Other operating expenses
Share of earnings in associated companies and joint ventures
Items affecting comparability
Operating income
Interest income
Interest expenses
Net leasing interest
Other financial items
Income before tax
Tax expenses
Net income for the year
Items that are or may be reclassified to profit or loss net of tax
Currency translation differences
Cash flow hedge
Other comprehensve income for the year
Total comprehensive income for the year
Net income for the year attributable to:
Equity holders of the parent company
Non–controlling interest
Net income for the year
Total comprehensive income for the year attributable to:
Equity holders of the parent company
Non–controlling interest
Total comprehensive income for the year
Earnings per share
Basic earnings per share (SEK)
Diluted earnings per share (SEK)
Number of shares
Shares outstanding at the end of the period
Basic average number of shares outstanding
Diluted average number of shares outstanding
70
Note
3, 4
5
6
6
15
8
3, 4, 5, 6, 7, 8
9
9
10
11
11
2019
15,671
–10,616
5,055
–1,047
–2,598
162
–32
5
–787
758
11
–30
–18
–9
712
–122
590
52
13
65
655
589
1
590
654
1
655
8.77
8.74
2018
14,568
–9,805
4,763
–857
–2,387
44
–17
–3
–40
1,504
11
–48
–
–15
1,452
–160
1,292
46
68
114
1,406
1,286
6
1,292
1,400
6
1,406
19.24
19.09
67,342,244
67,279,875
67,484,565
66,980,902
66,854,133
67,362,405
GRI 201-1
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Consolidated balance sheet
(SEK million)
Note
31 Dec 2019
31 Dec 2018
(SEK million)
Note
31 Dec 2019
31 Dec 2018
Non-current assets
Goodwill
Other intangible assets
Machinery, equipment and installations
Right-of-use assets
Shares and participations
Sublease receivables
Deferred tax assets
Other long term receivables
Total non-current assets
Current assets
Inventories
Accounts receivables
Sublease receivables
Prepaid programming expenses
Prepaid expense and accrued income
Tax receivables
Other current receivables
Cash, cash equivalents and short term investments
Total current assets
Total assets
12
12
13
23
15
23
10
16
23
17
10
2,311
1,073
165
566
142
192
64
107
4,621
2,551
1,112
34
3,359
1,250
207
325
1,238
10,077
14,697
2,274
1,131
152
–
20
–
24
103
3,704
2,428
1,224
–
2,875
1,076
39
428
428
8,498
12,202
Equity
Equity
Non controlling interest
Total equity
Non-current liabilities
Long-term borrowings
Long-term lease liability
Provisions
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities
Current liabilities
Short-term borrowings
Short-term lease liability
Accounts payable
Accrued programming expenses
Accrued expenses and prepaid income
Provisions
Tax liabilities
Other current liabilitites
Liabilities related to MTG
Total current liabilities
Total liabilities
Total shareholders' equity and liabilties
18
22
23
20
10
22
23
22
21
20
1,434
7
1,442
1,800
691
275
303
13
3,082
2,980
132
2,199
2,015
2,080
139
235
394
–
10,174
13,256
14,697
581
16
597
–
–
171
311
13
495
–
–
1,750
2,364
1,793
138
201
492
4,372
11,110
11,605
12,202
GRI 102-7
GRI 201-1
71
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Consolidated statement of changes in equity
(SEK million)
Balance as of 1 January 2018
Net income for the year
Other comprehensive income
Total comprehensive income for the year 2018
Paid share capital
Effect of share-based programmes
Dividends to shareholders with non-controlling interests
Transactions with shareholders
Balance as of 31 December 2018
Balance as of 1 January 2019
Net income for the year
Other comprehensive income
Total comprehensive income for the year 2019
Bonus issue
Shareholder contribution
Effect of share-based programmes
Dividends to shareholders SEK 6.50 per share
Changes in non-controlling interests
Balance as of 31 December 2019
Share
capital
Translation
reserve
Hedging
reserve
Retained
earnings
–
–
–
–
1
–
–
–
1
1
–
–
–
134
–
–
–
–
135
–123
–31
–
46
46
–
–
–
–
–77
–77
–
52
52
–
–
–
–
–
–25
–
68
68
–
–
–
–
37
37
–
13
13
–
–
–
–
–
50
2,717
1,286
–
1,286
–
20
–
–3,401
621
621
589
–
589
–134
620
15
–438
1
653
Non-
controlling
interest
10
6
–
7
–
–
–1
–
16
16
1
–
1
–
–
–
–
–9
7
Total
2,562
1,286
114
1,400
1
20
–
–3,401
581
581
589
65
654
–
620
15
–438
1
1,434
Total
equity
2,573
1,292
114
1,406
1
20
–1
–3,401
597
597
590
65
655
–
620
15
–438
–7
1,442
72
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Consolidated statement of cash flow
(SEK million)
Cash flow from operations
Net income for the year
Depreciation, amortisations and write-downs
Other adjustments for non-cash items
Cash flow from operations
Changes in working capital
Net cash flow from/to operations
Investing activities
Acquisitions of operations
Capital expenditures in tangible and intagible assets
Other investing activities
Cash flow from/used in investing activities
Financing activities
New long-term borrowings
Change in short-term borrowings
Amortisation of lease receivables
Amortisation of lease liabilities
Change in financing to/from MTG
Shareholders' contribution
Dividends to shareholders
Other cash flow from/used in financing activities
Cash flow from/used in financing activities
Total cash flow
Cash and cash equivalents at beginning of year
Translation differences in cash and cash equivalents
Cash and cash equivalents at end of year
Note
26
26
2019
2018
590
875
–72
1,393
–791
602
–15
–176
–99
–290
2,300
2,480
33
–121
–4,474
620
–438
75
475
787
428
23
1,238
1,292
208
–5
1,496
–380
1,116
–19
–550
2
–567
–
–
–
–
3,171
–
–3,310
–70
–209
339
89
–
428
73
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Parent company income statement
(SEK million)
Net sales
Gross income
Administrative expenses
Other operating income
Other operating expenses
Items affecting comparability
Operating income
Interest income and other financial income
Interest expense and other financial costs
Income before tax and appropriations
Group contribution
Income before tax
Tax expenses
Net income for the year
Other comprehensive income
Total comprehensive income for the year
Note
8
7, 8
9
9
10
2019
43
43
–252
–
–2
–48
–258
103
–56
–210
597
387
–75
312
–
312
2018
–
–
–145
15
–
–
–130
26
–20
–124
124
–
–
–
–
–
74
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Parent company balance sheet
(SEK million)
Note
31 Dec 2019
31 Dec 2018
(SEK million)
Note
31 Dec 2019
31 Dec 2018
Non-current assets
Capitalised expenditure
Shares and participations in group companies
Other long-term receivables
Total non-current assets
Current assets
Receivables from group companies
Other receivables
Prepaid expense and accrued income
Cash and cash equivalents
Total current assets
Total assets
12
14
17
–
110
3
113
10,831
73
15
974
11,893
12,006
1
–
–
1
13,059
266
1
–
13,326
13,327
Equity
Share capital (67,342,244 shares)
Retained earnings
Net income for the year
Total equity
Non-current liabilities
Long-term borrowings
Total non-current liabilities
Current liabilities
Short-term borrowings
Provisions
Accounts payable
Liabilities to group companies
Corporate tax payables
Accrued expense and prepaid income
Other current liabilities
Total current liabilities
Total liabilities
Total equity and liabilities
18
21
135
1,447
312
1,894
1,800
1,800
2,980
5
20
5,083
77
62
85
8,312
8,312
12,006
1
2,007
–
2,008
–
–
73
–
2
11,201
–
40
2
11,319
11,319
13,327
For information about pledged assets and contingent liabilities, see note 25.
75
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Parent company statement of changes in equity
(SEK million)
Share capital
Retained earnings
Total
Restricted equity
Non–restricted equity
Balance as of 1 January 2018
Net income for the year
Other comprehensive income
Total comprehensive income for the year 2018
Paid share capital
Shareholder contribution
Effect of share-based programmes
Balance as of 31 December 2018
Balance as of 1 January 2019
Net income for the year
Other comprehensive income
Total comprehensive income for the year 2019
Bonus issue
Dividends to shareholders
Effect of share-based programmes
Balance as of 31 December 2019
For information about changes in equity for the Parent company, see note 18.
–
–
–
–
1
–
–
1
1
–
–
–
134
–
–
135
–
–
–
–
–
2,000
8
2,008
2,008
312
–
312
–134
–438
11
1,759
–
–
–
–
1
2,000
8
2,008
2,008
312
–
312
–
–438
11
1,894
76
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Parent company cash flow statement
(SEK million)
Cash flow from operations
Net income for the year
Adjustments for non-cash items
Cash flow from operations
Changes in working capital
Net cash flow from/to operations
Investing activities
Investment in non-current assets
Other investing activities
Cash flow from/used in investing activities
Financing activities
New long-term borrowings
Change in short-term borrowings
Receivables/liabilities to/from group companies
Change in financing to/from MTG
Shareholders’ contribution received from MTG
Group contribution received
Dividends to shareholders
Other cash flow from/used in financing activities
Cash flow from/ used in financing activities
Cash flow from the year
Cash and cash equivalent at beginning of year
Cash and cash equivalent at end of year
Note
26
26
2019
2018
312
17
328
–264
64
–
3
3
2,300
2,480
–6,405
855
2,000
124
–438
–9
907
974
–
974
–
–115
–116
223
–107
–1
–
–1
–
–
106
–
–
–
–
–
106
–
–
–
77
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Notes
Content
Content
Accounting and reporting fundamentals
Note 1 Accounting and valuation principles
Note 2 Accounting estimates and judgements
Income statement
Note 3 Business segements
Note 4 Revenues
Note 5 Nature of expenses
Note 6 Other operating income and expenses
Note 7
Salaries, other remuneration and
social security expenses
Items affecting comparability
Note 8
Note 9 Financial Items
Note 10 Taxes
Note 11 Earnings per share
79
81
82
83
87
87
88
92
92
93
95
Assets
95
Note 12 Intangible assets
98
Note 13 Tangible assets
Note 14 Long-term financial assets
99
Note 15 Associated companies and joint ventures 100
100
Note 16 Accounts receivables
101
Note 17 Prepaid expense and accrued income
78
Shareholder equity and Liabilitites
Note 18 Shareholders' equity
Note 19 Proposed treatment of
unappropriated earnings
Note 20 Provisions
Note 21 Accrued expense and prepaid
income
Note 22 Financial instruments and
financial risk management
Note 23 Leases
Note 24 Future payment commitments
Note 25 Pledge assets and contingent
liabilities
Additional information
Note 26 Supplementary information to the
statement of cash flows
Note 27 Average number of employees
Note 28 Audit fees
Note 29 Related party transactions
Note 30 Events after the reporting period
101
102
103
103
104
111
112
112
113
114
115
115
116
Notes
1
Accounting and valuation principles
Nordic Entertainment Group AB (NENT) is a company domi-
ciled in Sweden. The Company’s registered office is located
at Ringvägen 52, P.O. Box 2094, SE-103 13 Stockholm, Sweden.
On 7 February 2019 an extraordinary general meeting of
Modern Times Group MTG AB (publ) resolved to distribute
all shares in Nordic Entertainment Group AB (publ) through
a dividend to the shareholders of MTG, and to admit the
shares of Nordic Entertainment Group AB (publ) to trading
on Nasdaq Stockholm. The listing of NENT on Nasdaq Stock-
holm took place on 28 March 2019.
The consolidated financial statements of the Company for
the year ended 31 December 2019 comprise the Company
and its subsidiaries and their share of participation in joint
ventures and associated companies.
The annual report including the financial statements were
authorised for issue by the Board of Directors on 2 April 2020.
The consolidated income statement and statement of finan-
cial position, and the income statement and the balance
sheet of the parent company will be presented for adoption
by the Annual General Meeting on 19 May 2019.
Basis of preparation
The financial statements for 2018 and 2019 is presented as
combined financial statements. The formation of the Nordic
Entertainment Group (NENT Group) comprised transactions
between entities that are under common control. All entities
in these combined financial statements were under common
control via Modern Times Group MTG AB’s (MTG) ownership
prior to the listing. Since these transactions are not covered
by any IFRS standard, a suitable and established method
in accordance with IAS 8, is to use the previous carrying
amounts, which is the principle the NENT Group has used. The
assets and liabilities have been aggregated and recognized
based on the carrying amounts they represent in MTG AB’s
consolidated financial statements as from the date they
became part of the MTG Group.
The combined financial statements for the fiscal years 2018
and 2019 are prepared in accordance with the International
Financial Reporting Standards, as approved within the EU.
The Group’s combined financila statements have been
prepared according to the same accounting policies and
calculation methods as were applied in the preparation of
the prospectus “Admission to trading of shares in Nordic
Entertainment Group AB (pub) on Nasdaq Stockholm” (issued
on 8 March 2019) except for the new standard IFRS 16 Leases
that have been applied in 2019.
The following new standard was applied
for the financial year 2019:
IFRS 16 Leases
A new standard for lease accounting – IFRS 16 Leases – has
been introduced with effect from 1 January 2019. The main
changes are the following: For the lessee, the classification
according to IAS 17 of operating and finance leases is re -
placed by a single lease accounting model. All leases are
recognised on the balance sheet as a right-of-use asset
and lease liability. Leases of low value assets, as well as
leases of 12 months or less, are exempt from the require-
ments. A substantial part of the London offices are subleased
and a financial receivable is recognised in accordance with
the standard. The expense for operating leases is replaced
by depreciation on the right-of-use asset, and interest
expense on the lease liability and interest income on the
sublease. The depreciation of lease assets is separately rec-
ognised from the interest on lease liabilities in the income
statement. This has increased the operating income at the
expense of the financial net. The Group has identified the
following categories of leases: offices, cars and car parks.
Studio equipment is normally leased on a short-term basis,
and most types of leased office furniture and IT equipment
are of low value and are therefore out of scope. NENT Group
has applied the modified retrospective method, which implies
no restatements of previous periods.
Other new and changed Accounting standards and inter-
pretations are not judged to have any material effect on the
Group’s financial reports.
New and amended Accounting standards and
interpretations after 2019
The Group has not made any early adoptions of new or
changed Accounting standards and interpretations effective
after 31 December 2019.
Consolidated accounts
The consolidated accounts include the Parent company, all
subsidiaries and the share of participation in joint ventures
and associated companies.
Subsidiaries
Subsidiaries are companies in which the Group exercises con-
trol, meaning that the Group has power over the subsidiary
and has exposure or rights to its variable returns. The Group
must also have the ability to use the power to affect the return
from the subsidiary. For all companies in which the Group
holds more than 50% of the votes the criteria’s of control are
fulfilled and the companies are consolidated as subsidiaries.
All business combinations are accounted for in accordance
with the purchase method. At the date of acquisition, the
acquired assets and assumed liabilities (net identifiable
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cont.
assets) are measured at fair value. The difference between
the acquisition value of shares in a subsidiary and identifiable
assets and liabilities measured at fair values at the date of
acquisition is recognised as goodwill. Any deficiency of the
cost of acquisition below the fair values of identifiable net
assets acquired is recognised in the profit and loss in the
period of acquisition. Acquisition related costs are expensed
as incurred. Results for companies acquired during the year
are included in the consolidated statement of comprehen-
sive income from the date of acquisition.
Non-controlling interest
In subsidiaries not wholly owned, the share of equity owned
by external shareholders is recorded as non-controlling inter-
est. There are two alternatives for the recognition of non-
controlling interests. One alternative is to recognise the non-
controlling interest at its share of fair value of the acquired
company; another alternative is to recognise the non-con-
trolling interests at its share of the fair value of the acquired
net assets. The former method (the full goodwill methods)
leads to a higher value of non-controlling interest and good-
will than the later method (the partial goodwill method). The
choice of method is made of each acquisition separately.
Associated companies
Associated companies are reported based on the equity
method. An associated company is a company in which the
Group exercises significant influence. Normally, this means
companies in which the Group holds voting rights of at least
20% and no more than 50%. for each acquisition separately.
Joint ventures
Joint ventures are arrangements in which two or more
parties have joint control and have rights to the net assets
of the arrangement. Joint ventures are recognised accord-
ing to the equity method (see Associated companies)
Functional currency and reporting currency
The functional currency of the parent company is the
Swedish krona (SEK). This is also the reporting currency for
the Group and the parent company.
Financial statements of foreign operations
The balance sheets of the Group’s foreign subsidiaries are
translated into Swedish krona (SEK). The translation is based
on the exchange rates ruling at the balance sheet date,
while the income statements are translated using an aver-
age rate for the period. The resulting translation differences
are charged in other comprehensive income and accumu-
lated in the translation reserve in equity. The accumulated
translation differences are reclassified to the income state-
ment when the foreign operation is divested.
Inventories
A significant portion of the amount reported as inventory
by the Group refers to the TV channels’ catalogue of pro-
gramme rights. Programme rights are reported as inventory
when the license period has begun, the programme itself is
available for its first broadcast, the cost of the programme is
known, and the programme content has been approved by
the TV channel. Programme rights invoiced, but where the
license period has not started and the programme cannot
be reported as inventory, is reported as prepaid expenses.
Future payment commitments in respect of contractual pro-
gramme rights that have not yet been reported as inventory
or prepaid expenses are reported as other commitments,
see note 24. Programme rights are normally acquired for
a specific number of runs, which can be played out during
a determined license period in certain territories. The pro-
gramme rights are expensed per run according to how the
program is expected to be broadcasted during the license
period. The recognition of sports rights starts when the con-
tractual period starts or when an advance payment is made.
Sports rights are allocated over the seasonal year and
on a yearly basis. The programme inventory is valued at
amortised costs.
Other inventories are valued at the acquisition cost or net
realisable value, whichever is lower. Net realisable value is the
estimated selling price in the ordinary course of business, less
the estimated costs of completion and selling expenses. The
cost of inventories is based on the first-in-first-out principle
and includes expenditure incurred in acquiring the inventories
and bringing them to their existing location and condition.
Parent company
The Parent company has prepared the Annual Report
according to the Swedish Annual Accounts Act and the
Swedish Financial Reporting Board recommendation RFR 2
Accounting for Legal Entities. RFR 2 involves application of
all IFRSs and interpretations endorsed by the European
Commission, except where the possibility to apply IFRS is
restricted by the Swedish Company Act and due to tax rules.
Holdings in subsidiaries are recognised in the Parent Company
according to the purchase method which means that the
transaction costs are included in the recognised value of
shares in subsidiaries. The Group recognises these costs in
the income statement immediately when occurred.
Group contributions
Group contributions received and paid are recognised as
appropriations in the income statement.
Untaxed reserves
Untaxed reserves in the parent company comprise a tax
allocation reserve. The reserve makes it possible to defer tax,
and hence even out the tax cost between years.
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Accounting estimates and judgements
The preparation of financial statements in conformity with
IFRSs requires the Board of Directors and the management
to make judgements, estimates and assumptions that affect
the application of policies and reported amounts of assets
and liabilities, income and expenses. The estimates and asso-
ciated assumptions are based on historical experience and
various other factors that are believed to be reasonable
under the circumstances, the results of which form the basis
of making the judgements about carrying values of assets
and liabilities that are not readily apparent from other
sources. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed
on an on-going basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised if
the revision affects only that period or in the period of the
revision and future periods if the revision affects both current
and future periods. The development, selection and disclosure
of the Group’s critical accounting policies and estimates and
the application of these policies and estimates are reviewed
by the Audit Committee.
Goodwill and intangible assets with indefinite useful lives
are subject to impairment tests yearly or when triggered
by events. The impairment review requires management
to determine the fair value of the cash generating units on
the basis of cash flow projections and internal forecasts and
business plans. For further information, see note 12 Intangible
assets.
Valuation of liabilities at fair value
The calculation of fair values of options, to acquire non-
controlling interests of acquired subsidiaries, and contingent
considerations are based on terms defined in agreements
set up in connection with the acquisitions. The valuations
are usually based on projections and forecasts of future
revenues and operating margin. The outcome of revenues
and operating margin could deviate from projections and
forecast, and, as a result of this, affect the valuation and
the eventual consideration for non-controlling interests. This
deviation would impact the income for the period and the
financial position.
Key sources of estimation uncertainty
Note 12 contain information of the assumptions and the risk
factors relating to goodwill impairment. Litigations and
provisions made are reported in note 20.
Goodwill and other intangible assets
Intangible assets, except goodwill and intangible assets with
indefinite useful lives, are amortised and depreciated over
their useful lives. Useful lives are based on management’s
estimates of the period that the assets will generate revenue.
Depreciation and amortisation of beneficial rights
and programme rights inventory
Depreciation and amortisation of beneficial rights and pro-
gramme rights inventory are expensed in accordance with
the estimated broadcasting period. A higher proportion of
the costs are expensed in the beginning of the broadcasting
period than the following periods. The estimated broadcasting
period could change, and, as a result of this, affect net income
for the period and the financial position. For further informa-
tion, see note 4 Revenue and note 12 Intangible assets.
Provisions and contingent liabilities
A provision is recognised when a present obligation exists
as a result of a past event, it is probable that economic
resources will be transferred, and reliable estimates can
be made of the amount of the obligation. In such a case,
a provision is calculated and recognised in the balance
sheet. A contingent liability will be disclosed when a possible
obligation has arisen, but its existence has to be confirmed
by future events outside the Group’s control, or when it is
not possible to calculate the amount. Realisation of any con-
tingent liability which is not disclosed or for which no amount
is not currently recognised could have a material impact on
the Group’s financial position.
The Group regularly reviews significant outstanding litiga-
tions in order to assess the need for provisions. Among the
factors considered, are the nature of the litigation, claims,
legal processes and potential level of damages, the opinions
and views of the legal counsellors, and the management’s
intentions to respond to the litigations or claims. To the extent
the estimates and judgments do not reflect the actual out-
come; this could materially affect the income for the period
and the financial position. For further information, see note
20 Provisions.
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Business segments
The performance is monitored at the business segment level
and the business segments are responsible for the manage-
ment of the operational assets. Financing is managed cen-
trally in the Group. Consequently, liquid funds, borrowings,
lease receivables/ liabilities and equity are not allocated to
the business segments.
The Group’s financial reporting structure is divided into the
following segments:
Broadcasting & Streaming
Broadcasting & Streaming includes both pay-TV, free-TV and
radio services for the Nordic region. Free-TV comprises TV
channels primarily financed by advertising in Sweden, Norway
and Denmark, as well as Viafree. Pay-TV markets and sells
Viasat’s premium pay-TV packages on the Viasat DTH satellite
platform, the Viaplay online platform and on third party IPTV
and cable networks. Viasat also distributes pay-TV channels
via third party pay-TV networks. The segment’s radio opera-
tions comprise the leading national commercial networks in
Sweden and Norway.
Studios
Studios comprise the Group’s content production and
distribution businesses in Scandinavia and Europe. The seg-
ment comprises a number of leading creators, producers
and distributors of television shows, commercials, events
and branded content.
Group (SEK million)
Broadcasting & Streaming
Studios
Central operations
Eliminations
Total before items affecting comparability
Items affecting comparability
Total
For a specification of Items affecting comparability, see note 8.
Group (SEK million)
Broadcasting & Streaming
Studios
Central operations
Total
Cash and cash equivalents
Borrowings
Lease receivables / liability
Equity incl. non-controlling interest
Eliminations
Total
1) Excluding investments in subsidiaries
82
External sales
Internal sales
Net sales
Operating income
2019
2018
2019
2018
2019
2018
13,639
2,030
2
12,785
1,769
13
15,671
14,568
58
254
77
389
15
142
71
228
13,697
2,284
79
–389
15,671
12,800
1,911
84
–228
14,568
15,671
14,568
389
228
15,671
14,568
2019
1,731
82
–268
1,545
–787
758
2018
1,661
45
–162
1,544
–40
1,504
Equity and
liabilities
Capital
employed
Capital
expenditure1)
Depreciation
and amortisation
2019
6,618
811
238
7,667
4,780
823
1,442
–14
14,697
2018
7,475
903
1,688
10,066
4,373
–
598
–2,834
12,202
2019
3,611
1,909
60
5,581
2018
2,270
1,722
550
4,541
2019
146
13
17
176
2018
490
35
25
550
2019
–179
–44
–7
–229
2018
–150
–45
–6
–201
5,581
4,541
176
550
–229
–201
Assets
2019
2018
10,230
2,721
298
13,248
1,238
225
9,744
2,625
2,239
14,608
428
–
–14
14,697
–2,834
12,202
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share 3
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4
Revenues
Geographical area
The Group’s business segments operate mainly in Europe.
Net sales and non-current assets are shown below by geo-
graphical area. Non-current assets constitute of intangible
and tangible assets. Sales are shown per country from which
the revenues are derived.
Revenue recognition
Revenue from external customers is mainly derived from sale
of advertising air time, subscription, content production as
well as licenses. To some extent, revenue is also derived from
the sale of goods. The accounting principles for the main
revenue streams are described in further detail below.
Net sales
Tangible and
intangible assets
Group (SEK million)
2019
2018
2019
2018
Sweden
Norway
Denmark
Finland
United Kingdom
Other
6,082
3,268
4,714
956
150
502
5,913
3,031
4,232
778
63
551
1,922
878
170
288
288
3
1,969
852
162
298
270
5
Total
15,671
14,568
3,550
3,556
Advertising revenue
A large component of the Group’s revenue derives from sale
of advertising air time as well as sponsoring. Revenue gener-
ated from advertising is generally recognised over time in
a pattern that best depict the service performed (e.g. as the
ad is played out). A smaller portion of the Group’s revenue
refers to ad sales, which is recognised at a point in time when
the Group delivers the goods or service and control is trans-
ferred to the customer
For yearly contracts, which typically contain several per-
formance obligations (such as different campaigns or spots),
the transaction price is allocated to each performance obli-
gation based on their stand-alone selling price.
Barter transactions
Barter entails the exchange of air time on TV or radio for
other goods or services. Revenue from barter transactions
is recognised at an amount equal to the fair value of the
goods or services received from the customer. If the fair
value of the good or service received cannot be reasonably
estimated, the Group recognises revenue equal to the stand-
alone selling price of the service promised to the customer.
Revenue is recognised over time in a way that depict the
transfer of control of the good or service as provided to the
customer.
Subscription revenue
The Group generates subscription revenue from subscription
fees for pay-TV and streaming services.
Subscriptions for pay-TV
A subscription usually consists of a main subscription fee,
hardware (a box) and card fee. Since the customer cannot
benefit from the subscription fee, hardware and card fee on
its own, these products and services are bundled into one
performance obligation. The contract period for subscription
of pay-TV varies between 6, 12 and 24 months and the cus-
tomer receives and consumes the benefits as the Group pro-
vides the service. Revenue is therefore recognised over time
over the binding period of the contract. The customer pays
for the subscription in advance on a monthly basis.
The subscription contracts could also contain additional
services/products other than the main subscription fee, hard-
ware and card fee as described above. These additional
services/products include, but are not limited to, extra hard-
ware and TV channel package. When a contract contains
additional services/products, an analysis is performed in order
to assess if these are separate performance obligations.
The additional services/products are normally regarded as
separate performance obligations.
Streaming services
For streaming services, the customer pays a fee to access
content which the customer has subscribed for. The customer
pays for the streaming service in advance on a monthly
basis. The streaming period usually consists of a trial period,
during which the customer is not committed to start a sub-
scription. The transaction price is not allocated to the trial
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cont.
period. The performance obligation is satisfied over time as
the Group provides access to the content over a period of
time (in practice per month).
In addition to the fee for the streaming service, the
customer can add other services to the contract such as
rental or purchase of films and series. The services added
are regarded as separate performance obligations as the
customer can benefit from these separately. Each service
added has a separate price and the revenue is recognised
at a point in time.
The subscription contracts are without a binding period
with a notice period of one month. Both the Group and the
customer have the right to terminate the contract and the
parties have no enforceable rights and obligations beyond
that month. The contracts for streaming services are there-
fore accounted for as a month-to-month contract.
Event revenue
Revenue from producing events on behalf of third party are
recognised at a point in time.
Licenses and royalty
A license arrangement establish the customer’s right related
to the Group’s intellectual property and the obligation of
the Group to provide those rights. The Group are granting
licenses to format and broadcasting rights. Licenses mainly
exist within the Studio business. All licenses are classified as
“right to use-licenses” and revenue are recognised when the
license period begins.
Other
Other revenue consists mainly of revenue from products,
such as hardware when sold separately from subscriptions.
Production revenue
Revenue in the Studio business is generated by production
of films and TV series. The contracts normally consist of one
performance obligation. Revenue for production of films
and TV series is recognised over time.
Significant judgement in revenue recognition
Agent or principal
The Group assesses whether it is acting as a principal or
agent in all transactions where another party is involved
in providing products or services to the customer. In transac-
tions where the Group is acting as an agent, revenue is
recognised net in the income statement. In transactions
where the Group is acting as a principal, revenue is recog-
nised gross in the income statement.
Revenue from performance obligations
satisfied in previous periods
Within free-TV third party distribution fees occurs related
to third party agreements for end customers usage of TV
channels. This fee is estimated based on historical data for
previous period. When the actual usage is received from the
customer an adjustement is made for revenue recognised
up to date.
Unsatisfied performance obligations
The Group does not disclose any information regarding
unsatisfied performance obligations as at December 31 since
the performance obligations refer to contracts where the
contract term is 12 months or less.
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Disaggregation of revenue
Revenue from external customers is mainly derived from sale of advertising air time,
subscription, content production as well as licenses.
Group (SEK million)
External revenue
Internal revenue
Total revenue for the segment
Revenue streams
Advertising
Subscription
Production
Licenses, royalities and other
Revenue from external customers
Timing of revenue recognition
At a point in time
Over time
Revenue from external customers
Broadcasting
& Streaming
13,639
58
13,697
4,005
8,771
22
841
13,639
841
12,798
13,639
Studios
2,030
254
2,284
78
–
1,585
368
2,030
368
1,662
2,030
2019
Central
operations
Elimination
Total
Broadcasting
& Streaming
2
77
79
–
–
–
2
2
2
–
2
–389
–389
–
–
15,671
–
15,671
4,083
8,771
1,607
1,210
15,671
1,210
14,460
15,671
12,785
15
12,800
4,017
8,272
61
438
12,785
436
12,350
12,785
2018
Central
operations
Elimination
Total
13
71
84
–
–
–
13
13
13
–
13
–228
–228
–
–
14,568
–
14,568
4,189
8,272
1,382
725
14,568
726
13,842
14,568
Studios
1,769
142
1,911
172
–
1,321
276
1,769
277
1,493
1,769
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Cost to obtain or fulfill a contract
Part of the sales acquisition costs within pay-TV has been defined as cost to obtain or fulfill a
contract. Cost to obtain a contract consist of external fees paid to third parties for the provi-
sion of new subscriptions and are incremental costs to obtaining contracts the Group would
not have incurred if the contracts had not been obtained. Cost to fulfill a contract are cost
related to installations, cost for hardware or freight. Cost to obtain or fulfill a contract are
recognised as an asset and amortised over the expected contract lifetime. Cost to obtain
or fulfill a contract are included in prepaid expenses.
Group (SEK million)
Opening balance 1 January
Increase of contract assets due to new contracts during the year
Amortisation expense of costs to obtain or fulfill a contract
Closing balance 31 December
2019
271
458
–378
351
2018
202
310
–242
271
Contract asset
Contract assets consists of accrued revenue, when the Group is entitled to compensation for
completed work, but the invoice has not been sent on the closing date. The change during the
year represents the net reclassification between accrued revenue and accounts receivable.
Group (SEK million)
Opening balance 1 January
A change in the timeframe for a right to consideration to become
unconditional
Closing balance 31 December
2019
575
134
709
2018
608
–33
575
Contract liability
Contract liabilities consist of the following prepaid income:
• Prepaid advertising revenues within free-TV and radio occurs when the customer has been
invoiced in advance of the service delivery
• Prepaid subscription revenues as customers within pay-TV pay one month in advance
• Prepaid revenue related to content production as the revenue is recognised over time
Group (SEK million)
Opening balance 1 January
Net change in contract liability during the year
Closing balance 31 December
2019
654
386
1,040
2018
678
–24
654
Contract liabilities reported at the beginning of 2019 and 2018 has been recognised
as revenue during each year.
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Nature of expenses
6
Other operating income and expenses
Nature of expenses
A function based income statement is presented as part of the financial statements of the
Group. The table below presents how the operational costs are classified based on the
nature of expense.
Accounting principle
Other operating income and expenses refers to income and expenses that does not derive
from the Group’s core operations such as government grants, gains or losses on divestment
of operations, gains or loss on sale of intangible and tangible assets, foreign exchange gains
or losses on operating receivables and payables.
Group (SEK million)
Net sales
Other operating income
Cost of programmes and goods
Distribution costs
Salaries, remuneration, and social security expenses
Depreciation and amortisation
Impairment charges
Other expenses
Share of earnings in associated companies and joint ventures
Items affecting comparability
Operating income
2019
15,671
162
–8,689
–2,436
–2,108
–330
–6
–724
5
–787
758
2018
14,568
44
–7,804
–2,435
–2,131
–201
–7
–487
–3
–40
1,504
Group (SEK million)
Other operating income
Gain from exchange rate differences
Government grants/ tax incentives
Other
Total
Other operating expenses
Loss from exchange rate differences
Depreciation and amortisation
Other
Total
2019
2018
41
58
63
162
–28
–
–5
–33
–
14
31
44
–6
–4
–7
–17
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Salaries, other remuneration and social security expenses
Group (SEK million)
Wages and salaries
Social security expenses
Pension costs
Share-based payments
Social security expenses on share-based payments
Total
Group (SEK million)
Board of Directors, CEO and other senior executives
of which variable salary
Other employees
Total
Parent company (SEK million)
Board of Directors, CEO and other senior executives
of which variable salary
Other employees
Total
2019
1,852
323
163
11
3
2,351
2019
128
63
2,223
2,351
2019
59
32
75
134
2018
1,609
392
118
20
–8
2,131
2018
104
10
2,027
2,131
2018
22
9
49
71
Remuneration to the Board of Directors and the Group Executive Management
Remuneration to the Board of Directors
The remuneration to the Board of Directors has been paid in accordance with the resolution
approved at the 2019 Annual General Meeting (AGM). The remuneration includes fees for
ordinary board work and fees for work within the committees of the Board. For 2018, and
the period leading up to the 2019 AGM, the board fees amounted to SEK 4.7m.
Remuneration to the Group Executive Management
The Remuneration Committee’s evaluation has resulted in the conclusion that there has been
compliance with the guidelines for remuneration to the senior executives resolved by the 2019
Annual General Meeting. Prior to the listing of NENT, the remuneration to those executives
who were a part of MTG’s executive management team were subject to MTG’s remuneration
guidelines. In the intermittent period between the listing of NENT and the 2019 Annual General
Meeting there were no guidelines for remuneration in place. The principles in the 2019 NENT
guidelines were complied with during this period with exception for the one-time cash perfor-
mance plan granted to legacy MTG employees as compensation for the cancelled 2018 MTG
share plan.
The Remuneration Guidelines for the Group Executive Management 2019
NENT’s remuneration policy is designed to drive and reward company and individual perfor-
mance, be market competitive to attract and retain key talent, and to incentivise the creation
of long-term shareholder value by requiring executives to build and maintain a significant
shareholding in NENT. Total remuneration may consist of fixed salary, variable components in
the form of short-term (‘STI’) and long-term incentive (‘LTI’) plans, pension and other benefits/
allowances.
• Fixed salary shall be fair and competitive based on the individual executive’s responsibilities
and performance.
• The STI shall be based on fulfilment of established targets for the Group and in the senior
executives’ area of responsibility. The result shall be linked to measurable targets (qualitative,
quantitative, general, individual). The targets within each area of responsibility are defined
to promote NENT’s development in the short and long-term. The maximum payment under
the STI shall generally not exceed 100 percent of the senior executives’ fixed salary.
• The LTI shall be linked to certain pre-determined financial and/or share or share-price
related performance criteria and shall ensure a long-term commitment to the development
of NENT and align the senior executives’ incentives with the interest of shareholders.
• By way of exception, additional one-off arrangements can be made on a case by case
basis when deemed necessary, subject to Board approval. Each such arrangement shall be
capped and never exceed two (2) times the individual’s annual base salary.
• All benefits/allowances including pensions follow the competitive market practice in the
applicable country of executives’ employment or residence.
• The maximum notice period in any senior executive’s contract is twelve months during which
time salary payment will continue.
The Board of Directors shall be entitled to deviate from these guidelines if special reasons for
doing so exist in any individual case.
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Remuneration and terms of employment for the
President & CEO in 2019
The remuneration to the President & CEO includes fixed
salary, variable components in the form of STI and LTI plans,
pension in the form of defined contribution and other bene-
fits/allowances. For 2019, the base salary was set at SEK 7.2m.
In December 2019 the Board made a minor adjustment to
the President & CEOs remuneration to simplify the arrange-
ments. Part of the benefits/allowances provided were
removed and converted to base salary taking into account
the impact on incentives and pension. In addition to partici-
pating in the 2019 NENT STI and LTI plans, the President & CEO
was eligible for two plans connected to the split from MTG:
1) the one-off listing bonus corresponding to six months’ base
salary; and 2) the one-time cash performance plan granted
to legacy MTG employees as compensation for the can-
celled 2018 MTG share plan. The maximum award for the
President & CEO was four months’ base salary. Payment
under the plan was conditional on fulfilment of the same
performance conditions as for the 2019 LTIP. A notice of
termination period of one year applies for the President &
CEO if such notice is given by the Company or the President
& CEO respectively. The agreement does not provide for
any severance pay.
Remuneration and terms of employment for other
members of the Group Executive Management in 2019
The remuneration to the Group Executive Management
members included fixed salary, variable components in the
form of STI and LTI plans, pension in the form of defined con-
tribution and other benefits/allowances. In addition to partici-
pating in the 2019 NENT STI and LTI plans, the majority of
members were eligible for two plans connected to the split
from MTG: 1) the one-off listing bonus corresponding to three
to six months’ base salary for the Group Excecutive Manage-
ment members included in the plan and 2) the one-time cash
performance plan granted to legacy MTG employees as
compensation for the cancelled 2018 MTG share plan. The
maximum award was three to four months’ base salary for
members of the Group Executive Management. Payment
under the plan was conditional on fulfilment of the same per-
formance conditions as the 2019 LTIP. A notice of termination
period of six to twelve months applies to the Group Executive
Management members if such notice is given by the Com-
pany or the Group Executive Management member respec-
tively. Any severance pay is limited to six months’ base salary.
Group Executive Management
The current Group Executive Management includes the
President & CEO, the EVP & CFO and Head of Strategy and
M&A and six other Executive Vice Presidents. The Group
Executive Management is described on pages 53–54. During
2019 there were substantial changes to the Group Executive
Manage ment team primarily due to the reorganisation of
the Company effective 1 October 2019.
Remuneration to the Board of Directors
(SEK thousand)
David Chance, Chairman of the Board
Anders Borg
Henrik Clausen 3)
Simon Duffy
Kristina Schauman
Natalie Tydeman
Total
Board fee
20191)
Board fee
20182)
1,503
630
553
735
630
620
4,670
1,503
630
553
735
630
605
4,655
1) Board fees consist of remuneration for ordinary Board work (SEK 3,950,000) and remuneration for work in the committees (SEK 720,000).
2) Board fees consist of remuneration for ordinary Board work (SEK 3,950,000) and remuneration for work in the committees (SEK 705,000).
3) Henrik Clausen stepped down from the Board of Directors on 4 February 2020.
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Remuneration and other benefits to the
Group Executive Management
(SEK thousand)
Anders Jensen, President & CEO
Group Executive Management (17 members)4)
Total
Variable
remunera-
tion paid in
2019 1)
Variable
remunera-
tion due in
2020 2)
LTIP cost 3)
Other
benefits
3,600
14,934
18,534
9,616
34,267
43,883
1,287
2,958
4,245
243
662
905
Base
salary
7,216
35,326
42,542
Pension
Total
427
3,455
3,882
22,388
91,602
113,991
1) Variable remuneration paid in 2019 refers to the one-off listing bonus connected to the split from MTG earned during 2018 and 2019.
2) Variable remuneration due in 2020 refers to the STI payments for 2019 and the one-time cash performance award connected to the split from MTG.
3) Non-cash share-based incentive programme costs for LTIP 2019 is calculated in accordance with IFRS 2.
4) The 2019 amounts disclosed for Group Executive Management relate to the full year for: Anders Jensen, Gabriel Catrina, Kim Poder, Matthew Hooper,
Jakob Mejlhede Andersen, Kaj af Kleen and Sahar Kupersmidt. Part-year for Susan Gustafsson (Jan–Jun), Jennie Jacobs (Jan–May), Cecilia Gave
(Mar–Sep), Mia Suazo Eriksson (Oct–Dec), Jonas Gustafsson, Vegard Klubbenes Drogseth, Mathias Norrback, Morten Mogensen, Alexander Bastin
and Kim Mikkelsen (Jan–Sep). Filippa Wallestam was on partial parental leave during the period Jan–Jul.
Out of the remuneration to other members of the Group Executive Management SEK 59 million was expensed in the parent company and 69 million was
expensed in the subsidiaries.
Decision process
The remuneration to the Chief Executive Officer was
decided by the Board of Directors on recommendation by
the Remuneration Committee. The remuneration policy for
the Group Executive Management is determined by the
Remuneration Committee and the Board.
Share-based compensation
The Group issues equity-settled share-based payments to
certain employees. Equity-settled share-based payments are
measured at fair value at the date of grant. The fair value
determined at the grant date, including social security costs,
is based on the Group’s estimate of shares that will eventually
vest and is expensed on a straight-line basis over the vesting
period. The fair value expense excluding social fees is re -
ported in the income statement as personnel costs with the
corresponding increase in equity. For the recurring calculation
of social security costs the fair value is revalued quarterly.
The current plan has a three-year vesting period and the
payment is depending on the fulfillment of certain stipulated
performance conditions.
Long-term incentive plan (LTIP) 2019
The Annual General Meeting 2019 approved a share-based
long-term incentive plan, LTIP 2019. The plan is performance-
based and directed to approximately 100 participants
across NENT including the Group Executive Management,
other senior executives and key employees. The plan is
designed to attract, motivate and retain key talent within
NENT and to align participants’ interests with shareholders.
The number of shares that vest in 2022 is dependent on
the achievement of two equally weighted NENT targets;
(i) organic sales growth (organic sales growth refers to
growth excluding the effects of acquisitions/divestments
and adjusted for currency effects), and (ii) operating income
(operating income before Items Affecting Comparability
(IAC) may be adjusted for extraordinary or non-budgeted
items or events not related to the ordinary course of business
including acquisitions/divestments) for the 2019 financial year.
Threshold and maximum target levels were established by
the Board at grant. If the minimum threshold level is achieved,
25% of the Performance Share Awards will vest. If the maxi-
mum level is achieved, 100% of the Performance Share
Awards will vest. For target achievement between the
threshold and maximum level, the vesting outcome will be
measured linearly.
To ensure that senior executives build and maintain a signif-
icant shareholding in NENT, vesting is conditional on a share
ownership requirement for the CEO and the full Group Exec-
utive Management population. The CEO and members of
the Group Executive Management are required to accumu-
late NENT shares toward target ownership levels that are
based on a percentage of net salary. For the CEO, the target
ownership level is 150% and, for the members of the Group
Executive Management, amounts to 75% and 50% depend-
ing on tier. For current Group Executive Management, 33%
of the requirement must be met each year over three years.
The participants’ maximum profit per Performance Share
Award in LTIP 2019 is limited to four times the volume- weighted
average of the market price of NENT’s Class B Shares on
Nasdaq Stockholm during the five trading days immediately
following the publication of the company’s interim report for
the first quarter 2019 (the “Share Price Cap”). If the value of
NENT’s Class B Share exceeds the Share Price Cap at vesting,
the number of Class B Shares that each right entitles the par-
ticipant to receive at vesting will be reduced correspondingly.
The performance outcome for LTIP 2019 was 99% and
100% of the maximum number of shares may vest and be
allocated to participants in 2022, as shown in the table
below. Vesting is conditional upon that the participant, with
certain customary exceptions, at the time of the publication
of NENT’s interim report for the first quarter of 2022, is still
employed by the NENT Group.
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Cost effects of the incentive programme
LTIP 2019 is equity-settled. The initial fair value at grant date of the share programme, is
expensed during the vesting period. The cost for the programme is recorded as an operating
expense. The cost is based on the fair value of the NENT Class B share at grant date and the
number of shares expected to vest. The cost recognised for the programme in 2019 amounts
to SEK 11 million excluding social charges. Social charges amounted to SEK 3 million and included
in accrued expenses in the balance sheet. There were no share rights exercisable at the end
of 2019.
Outcome of LTIP and one-time Cash Plan 2019 measured over one year
Performance targets
Allocation of LTIP shares 2022
and One-time Cash Plan in
2020
Performance conditions
Threshold Maximum
Actual Outcome
Weight Allocation
Operating income before IAC1)
Organic sales growth
Total allocation
1,386
5.0%
1,617
6.5%
1,621
6.4%
100%
97%
50%
50%
Total allocation decided by the Board of Directors 2)
50%
49%
99%
100%
1) Refers to normalised operating income (EBIT) before items affecting comparability. In accordance with the plan
rules, the Board of Directors has adjusted the calculation of actual level for non-budgeted items or events not
related to the ordinary course of business e.g. M&A iinvestments outside of budget.
2) The Board of Directors have decided to round up to 100% allocation, in accordance with the plan rules and man-
dates of the Board.
Dilution
If all the share rights awarded to senior executives and key employees as at 31 December
2019 were exercised, the outstanding shares of the Company would increase by 332,902 Class
B shares, and be equivalent to a dilution of 0.5% of the issued capital and 0.5% of the related
voting rights at the end of 2019.
Category
Maximum
number of
B shares1)
Maximum
value
(SEK Million)2)
President & CEO (Tier 1)
Other members of Group Executive Management (Tier 2 and 3)
Senior executives and key employees (Tier 4 and 5)
Total outstanding as per 31 December 2019
42,654
108,741
181,507
332,902
13
33
55
100
1) Representing 100% of the number of shares granted in May 2019.
2) Calculated based on a share price of SEK 301.28 on 27 December 2019.
No of share awards outstanding
Share awards outstanding of the beginning of the year
Share awards allotted during the year
Share awards forfeit during the year
Total outstanding as per 31 December
The weighted average remaining contractual life for the remaining share awards is 2.5 years.
LTIP 2019
–
406,460
–73,558
332,902
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Items affecting comparability
Accounting principle
Items affecting comparability (IAC) refers to material items and events related to changes
in the Group’s structure or line of business, which are relevant to understanding the Group’s
develeopment on a like-for-like basis.
Separate reporting of items affecting comparability provides a better understanding of the
Group’s operating activitites and offers more compareble figures between periods.
Group (SEK million)
Costs related to the separation and listing of NENT Group
Write down of free-TV content and other assets
Restructuring NENT Group
Revaluation of liabilities related to options to acquire shares
Impairment of goodwill related to closed company
Deconsolidation of the operations in Tanzania
Total
Items affecting comparability classified by function
Group (SEK million)
Cost of goods sold
Administrative expenses
Other operating income
Other operating expenses
Total
2019
–56
–540
–190
–
–
–
–787
2019
–416
–368
–
–3
–787
2018
–
–16
–53
14
–6
21
–40
2018
–
–53
35
–22
–40
9
Financial items
Group (SEK million)
Interest income
Interest income, MTG Group
Total interest revenue
Interest expense on borrowings
Interest expense, MTG Group
Interest expense, other
Total interest expenses
Leasing interest income
Leasing interest expense
Leasing net interest
Net exchange rate differences
Effect from discounting
Other
Other financial items
Net financial items
2019
2018
11
–
11
–29
–
–2
–30
8
–26
–18
1
2
–11
–9
–47
4
7
11
–
–46
–2
–48
–
–
–
–
2
–17
–15
–52
Parent company (SEK million)
2019
2018
Interest income from external parties
Interest income from Group companies
Net exchange rate differences
Total interest income and other financial income
Interest expense to external parties
Interest expense to Group companies
Borrowing costs
Total interest expense and other financial costs
Net financial items
10
97
–4
103
–29
–16
–12
–56
47
19
5
3
26
–19
–1
–
–20
7
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Taxes
Accounting principle
Corporate income tax
Tax expenses includes current and deferred tax Swedish
and foreign corporate income taxes. Other taxes such as
non-deductable VAT, withholding tax, property tax etc is
reported as operating expense based on the function of
the underlying transaction.
Deferred tax
Deferred tax refers to changes in temporary differences
between an assets or a liability’s carring amount and it’s tax
base. A deferred tax asset is reported corresponding to the
tax value of loss carry forwards if it is judged likely that the
loss carry forward will be used to taxable income in the fore-
seeable future.
Distribution of tax expense
Group (SEK million)
Current tax expense
Adjustment for prior years
Total current tax
Deferred tax
Total
Parent company (SEK million)
Current tax expense
Deferred tax
Total
2019
–183
4
–179
57
–122
2019
–77
1
–76
2018
–163
–21
–184
24
–160
2018
–
–
–
Distribution of tax expense
Group (SEK million)
2019
2018
Tax
base
Current
tax
Deferred
tax
Total
tax
Tax
base
Current
tax
Deferred
tax
Total
tax
Income before tax – Nominal tax rate, 21.4% / 22.0%
Non-taxable income
Non-deductable expenses
Temporary differences
Tax-losses, capitalised
Tax losses, not capitalised
Tax losses carry-forward, previously capitalised
Tax losses carry-forward, not previously capitalised
Group contribution from ultimate parent (MTG)
Revaluation of deferred tax
Effects from foregin tax rates
Under/over provided in prior years
Total
712
–71
105
162
146
30
–2
–113
–
–
–
–
–
–152
14
–21
–34
–31
–6
1
24
–
–
23
4
–179
–
–
–
34
31
–
–1
–
–
–8
–
–
57
–152
14
–21
–
–
–6
–
24
–
–8
23
4
–122
1,452
–189
354
161
–
31
–39
–126
–776
–
–
–
–
–319
40
–79
–34
–
–8
9
27
171
–
30
–21
–184
–
–
–
34
–
–
–9
–
–
–
–
–
24
–319
40
–79
–
–
–8
–
27
171
–
30
–21
–160
Parent company (SEK million)
2019
2018
Tax
base
Current
tax
Deferred
tax
Total
tax
Tax
base
Current
tax
Deferred
tax
Total
tax
Income before tax – Nominal tax rate, 21.4% / 22.0%
Non-taxable income
–210
–63
Non-deductible expenses
Temporary differences
Group contribution
Total
28
6
597
–
45
13
–6
–1
–128
–77
–
–
–
1
–
1
45
13
–124
–
–6
–
–128
–76
–
–
123
–
24
–
–
–
–24
–
–
–
–
–
–
–
24
–
–
–
–24
–
93
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share 10
cont.
Unrecognised tax losses carry-forward by expiry date
Group (SEK million)
2019
2020
2021
2022
2023 and thereafter
No expiry date
Total
There were no tax losses carry forward in 2018 and 2019 in the parent company.
2019
–
21
49
31
135
6
242
2018
17
22
47
30
130
95
341
Deferred tax attributable to:
Group (SEK million)
Tax losses carried forward
Goodwill
Intangible assets
Tangible assets
Right-of-use assets
Financial assets
Inventory
Current receivables
Provisions
Current liabilities
Untaxed reserves
Total
whereof Deferred tax assets
whereof Deferred tax liabilities
Parent company (SEK million)
Financial assets
Total
whereof Deferred tax assets
94
Opening
balance
1 Jan 2018
Deferred tax
recognised
in the P&L
Deferred tax
recognised
in OCI
Translation
differences /
reclass.
31 Dec 2018/
1 Jan 2019
Deferred tax
recognised
in the P&L
Deferred tax
recognised
in OCI
Translation
differences
Closing
balance
31 Dec 2019
–
–149
–152
11
–
–14
–
18
4
–
–
–280
21
–
9
1
–
–3
3
–11
5
–
–
24
–
–
–
–
–
–6
–
–
–
–
–
–6
–21
–
–
–
–
–
–
–6
1
–
–
–26
28
–
20
–5
1
7
–
1
4
2
-2
57
–
–
–
–
–
–2
–
–
–
–
–
–2
–
–147
–144
11
–
–22
3
1
10
–
–
–287
24
–311
–
–
–
–
–
–3
–
–
–
–
–
–3
29
–147
–125
7
1
–21
3
2
14
2
–2
–239
64
–303
Opening
balance
1 Jan 2018
Deferred tax
recognised
in the P&L
Deferred tax
recognised
in OCI
Translation
differences
31 Dec 2018/
1 Jan 2019
Deferred tax
recognised
in the P&L
Deferred tax
recognised
in OCI
Translation
differences
Closing
balance
31 Dec 2019
–
–
–
–
–
–
–
–
–
–
–
1
1
–
–
–
–
1
1
1
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share 11
Earnings per share
12
Intangible assets
Group (SEK million)
2019
2018
Earnings per share before dilution
Net income for the year attributable to equity holders of the
parent company
Shares outstanding on 1 January
Effect from share awards exercised
Weighted average number of shares, basic
Basic earnings per share, SEK
Diluted earnings per share
Diluted net income for the year attributable to the equity holders
of the parent company
Weighted average number of shares, basic
Effect from share awards
Weighted average number of shares, diluted
589
1,286
66,980,902
298,973
67,279,875
66,725,249
128,884
66,854,133
8.77
19.24
589
1,286
67,279,875
204,690
67,484,565
66,854,133
508,272
67,362,405
Accounting for intangible assets
Intangible assets are reported net after deductions for accumulated amortisation according
to plan and impairment losses. Amortisation according to plan are normally calculated on a
straight-line schedule based on the acquisition value of the asset and its estimated useful life.
The intangible assets are classified in the following categories:
Asset
Amortisation period
Capitalised development expenditure
3–10 years
Trademarks
Trademarks being part of a purchase price alloca-
tion are normally judged to have indefinite lives
with impairment tests annually or if triggered by
events
Customer relations
10–15 years
Beneficial rights/ broadcasting licenses
Estimated amortisation period based on the terms
of the license
Indefinite lives with impairment tests annually or if
triggered by events
Diluted earnings per share, SEK
8.74
19.09
Goodwill
Potentially dilutive instruments
Nordic Entertainment Group AB has one outstanding long-term incentive plan. The potential
dilution is calculated in order to determine the number of shares that can be excercised at
fair value based on the value of the share awards. Performance share awards are included
in the potentially dilutive shares from the start of the program, and in accordance with the
performance targets achieved. The Company has one outstanding programme from 2019
where the vesting has not occured, but that might have a diluting effect. As per 31 December
2019 the share awards amounted to 332,902.
Capitalised development expenditure
Expenditure on development activities, aiming at new or substantially improved products
and processes, are capitalised if the process is technically and commercially feasible and the
Group has sufficient resources to complete the development. The development expenditure
capitalised includes the direct costs and, when appropriate, cost of direct labour and an
appropriate proportion of overheads. Other development expenditures is expensed in the
income statement as incurred. Capitalised development expenditures are stated at cost less
accumulated amortisation and impairment losses. The capitalised expenditure relates mainly
to software and software platforms.
95
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share 12
cont.
Goodwill
Goodwill arising on consolidation represents the excess of the cost of acquisition over the
Group’s interest in the fair value of the identifiable assets and liabilities of an acquired business.
Goodwill is recognised as an asset and tested for impairment losses at least annually. Any
impairment is recognised immediately in the income statement and cannot be reversed.
Goodwill arising from acquisitions of associated companies is included in the reported value of
shares in associated companies. Impairment tests are made on the total cash generating unit.
Other intangible assets
Other intangible assets, such as acquired customer relations, beneficial rights, broadcasting
licenses and trademarks, are stated at cost less accumulated amortisation and impairment
losses.
2019
2018
Group
Parent,company
Capital,expenditures
Capitalised
expenditure
Trade-
marks
Other
Goodwill
Total
Capitalised
expenditure
Trade-
marks
Other
Goodwill
Total
2019
2018
475
96
–
–28
16
–
560
–311
27
–103
–6
–6
–
–398
164
161
531
–
–
–
–
14
545
–18
–
–
–
–
–
–18
514
527
681
–
–
–4
12
6
695
–227
4
–71
–
–11
–4
–310
454
385
4,187
–
–
–
–
37
4,224
–1,914
–
–
–
–
–
–1,913
2,274
2,311
5,874
96
–
–32
28
57
6,023
–2,470
31
–175
–6
–16
–4
–2,639
3,405
3,385
384
109
–
–2
–16
0
475
–225
1
–87
–1
1
–
–311
159
164
517
–
–
–
–
14
531
–18
–
–
–
–
–
–18
499
513
344
363
–
–35
1
8
681
–207
38
–54
–
–
–5
–227
137
454
5,024
–
10
–877
0
30
4,187
–2,784
877
–
–6
–
–
–1,914
2,240
2,274
6,270
471
10
–915
–15
53
5,874
–3,234
916
–141
–7
1
–5
–2,470
3,035
3,405
1
–
–
–1
–
–
–
–
–
–
–
–
–
–
–
–
–
1
–
–
–
–
1
–
–
–
–
–
–
–
–
1
(SEK,million)
Acquisition,values
Opening balance 1 January
Investments during the year
Acquisitions through business
combinations
Sales and disposals during the year
Change in Group structure,
reclassifications etc
Translation differences
Closing balance 31 December
Accumulated amortisation and
impairment losses
Opening balance 1 January
Sales and disposals during the year
Amortisation during the year
Impairment losses during the year
Change in Group structure,
reclassifications etc
Translation differences
Closing balance 31 December
As per 1 January
As per 31 December
96
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share 12
cont.
Amortisation by function
Group (SEK million)
Cost of goods and services
Administrative expenses
Other operating expenses
Total
2019
–166
–9
–
–175
2018
–137
–4
–
–141
Impairment losses by function
Group (SEK million)
2019
2018
Cost of goods and services
Other operating expenses
Items affecting comparability
Total
–2
–4
–
–6
Cash generating units with significant
carrying amounts of goodwill
Group (SEK million)
Broadcasting & Streaming
Studios
Total
2019
1,301
1,010
2,311
–1
–
–6
–7
2018
1,286
988
2,274
Impairment testing
Impairment testing, of goodwill and other intangible assets
with indefinite lives, are based on calculations of the recover-
able amount (value in use), using a discounted cash flow model.
The cash flows of each cash generating unit are discounted
at a pre-tax interest of 8.8% for Broadcasting & Streaming
and 9.8% for Studios considering the cost of capital, territory,
the economic environment and risk. The model involves key
assumptions such as sales, growth rates, sales prices and cost
growth together with working capital requirements. These
cash flow projections, calculated over a minimum of a five-
year period, are based on actual operating results, forecasts
and financial projections, using historical trends, general
market conditions, industry trends and other available infor-
mation. After the five-year period, a growth rate of 2.5%
(2.5) is normally applied.
Impairment
The impairment tests are carried out on a regular basis,
annually or when triggered by events. The tests did not
trigger an impairment for the Group during the period.
Cash generating units with trademarks with indefinite lives
Group (SEK million)
Broadcasting and Streaming
Studios
Total
2019
251
276
527
2018
244
270
513
Sensitivity
The Broadcasting & Streaming segment, which do not
indicate an impairment requirement, have such a margin
that reasonably possible adverse changes in individual
parameters would not cause the value in use to fall below
the book value. However, cash flow projections are to its
nature more uncertain and may also be influenced by factors
not in control by the company. Such factors could be political
risks and general market conditions, which might quickly dete-
riorate due to a financial crisis such as crisis due to instability in
the financial sector.
The test for the Studios segment indicates a low headroom
(i.e. the difference between the recoverable value and the
carrying value). The current calculation, using an individual
WACC of 8.8%, do not indicate impairment, but a change in
the recoverable amount, depending on changes in the market
conditions or other parameters, could result in an impairment.
A change in the growth rate would give the following results
for Studios.
Studios (SEK million)
Recoverable amount
Carrying amount
The recoverable amount in relation to the
carrying amount in case of a decrease in
growth rate
–0,5 percentage point
–1,0 percentage point
2019
2,274
2,075
2,150
2,050
97
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share
Depreciation by function
Group (SEK million)
Cost of goods and services
Selling expenses
Administrative expenses
Other operating expenses
Total
Write-downs by function
Group (SEK million)
Other operating expenses
Total
2019
–18
–
–36
–
–54
2019
–1
–1
2018
–33
–1
–23
–4
–61
2018
–
–
13
Tangible assets
Accounting for tangible assets
Tangible assets are reported at cost less accumulated depreciation and any write-downs.
Where parts of an item of machinery and equipment have different useful lives, they are
accounted for as separate items of machinery and equipment. Depreciation are normally
calculated using the straight-line method over the assets estimated useful life. Machinery
and equipment are depreciated over a period of 3 to 5 years.
Group (SEK million)
Cost
Opening balance 1 January
Investments during the year
Sales and scrapping during the year
Change in group structure, reclassifications etc
Translation differences
Closing balance 31 December
Accumulated depreciation and write-downs
Opening balance 1 January
Sales and scrapping during the year
Depreciation during the year
Write-downs
Change in group structure, reclassifications etc
Translation differences
Closing balance 31 December
Carrying amount
As per 1 January
As per 31 December
Equipment, tools
and installations
2019
2018
710
80
–115
–28
8
655
–559
115
–54
–1
16
–7
–489
152
165
666
79
–62
15
11
710
–547
60
–61
–
–1
–10
–559
120
152
98
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share 14
Long-term financial assets
Group companies
The following table lists the major companies included in the Group. A detailed specification of group companies has been submitted
to the Swedish Companies Registration Office and is available upon request from Nordic Entertainment Group Investor Relations.
Shares and participations in Group companies
Ownership in Group companies
Nordic Entertainment Group Radio AB
Nordic Entertainment Group Sweden AB
Viaplay AB
Splay One AB
Strix Television AB
Nordic Entertainment Group Denmark A/S
TV3 Sport1 A/S
Nordic Entertainment Group A/S
Nordic Entertainment Group Norway A/S
Nordic Entertainment Group AS
P4 Radio Hele Norge AS
NICE Entertainment Group Oy
Nordic Entertainment Group Finland OY
Nordic Entertainment Group Ltd
Digital Rights Group Limited
Co. Reg.no.
556365-3335
556304-7041
556513-5547
556909-3882
556345-5624
Registered
office
Share
capital (%)
Voting
rights (%)
Sweden
Sweden
Sweden
Sweden
Sweden
Denmark
Denmark
Denmark
Norway
Norway
Norway
Finland
Finland
United Kingdom
United Kingdom
100
100
100
100
100
100
100
100
100
100
100
100
100
100
95
100
100
100
100
100
100
100
100
100
100
100
100
100
100
95
Parent company (SEK million)
Co. Reg.no.
Registered office Number of shares Share capital (%)
Voting rights (%)
Nordic Entertainment Group Sweden Holding AB
Total
556057-9558
Stockholm
5,000
100%
100%
Book value
31 Dec 2019
Book value
31 Dec 2018
110
110
–
–
Share capital (%) and Voting rights (%) represent 31 Dec 2019
Shares and participations in Group companies
Parent company (SEK million)
Opening balance 1 January
Acquisition, internally
Closing balance 31 December
2019
–
110
110
2018
–
–
–
99
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share 15
Associated companies and joint venture
16
Accounts receivables
Accounting principle
Associated companies and joint ventures are reported based on the equity method. The share of earnings is equal to the
Group’s share of net income in each associated company or joint venture after conversion into Swedish krona. The following
table lists the associated companies and joint ventures included in the Group.
Ownership in Group companies
Airtime Sales AB
NSR Scandinavia AB
Filmen Hundraåringen AB
Angel Films Oy
Dagsljus Teknik AB
Nice Flx Pictures AB
Mediamätning i Skandinavien AB
GH Gigahertz HB
Radiobranschen RAB AB
Digitalradio Norge AS
FilmNation LLC
Co. Reg.no.
559040-3399
556821-4356
556828-8509
556218-3284
556846-4613
556353-3032
969616-7551
556623-1345
Registered
office
Share
capital (%)
Voting
rights (%)
Sweden
Sweden
Sweden
Finland
Sweden
Sweden
Sweden
Sweden
Sweden
Norway
United Kingdom
50
48
50
48
48
48
25
40
40
50
40
50
48
50
48
48
48
25
40
40
50
40
Summarised financial information
Group (SEK million)
Net sales
Net income
Other comprehensive income
Non-current assets
Current assets
Total assets
Non-current liabilities
Current liabilities
Total liabilities
2019
225
11
–
22
45
67
8
70
78
2018
195
–12
–
30
91
121
16
85
101
Share of earnings in assoicated companies
and joint ventures
Group (SEK million)
Share of earnings
Carrying amount
Group (SEK million)
Equity share in associated
companies and joint ventures
Shares in other companies
Total
2019
5
2018
–3
2019
2018
34
108
142
17
3
20
Group (SEK million)
31 Dec 2019
31 Dec 2018
Accounts receivables
Gross accounts receivables
Less allowances for doubtful
accounts
Total
Allowance for doubtful
accounts
Opening balance 1 January
Provision for potential losses
Actual losses
Reversed write-offs
Translation differences
Closing balance 31 December
Analysis of accounts
receivables
Not due
Overdue 30–90 days
Overdue > 90 days
Total
1,187
1,244
–75
1,112
–20
1,224
20
70
–10
–5
1
75
869
204
114
1,187
34
9
–6
–18
1
20
914
231
99
1,244
The credit risk is diversified among a large group of customers.
The credit risk is assessed based on historical data. The recog-
nised values are judge to be reasonable approximation of
the fair values.
100
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share 17
Prepaid expense and accrued income
18
Shareholders’ equity
Group (SEK million)
31 Dec 2019
31 Dec 2018
Prepaid expenses
Personel
Production
Capitalised subscriber
acqusition cost
Other
Total
Accrued income
Advertising
Subscription
Production
License and royalty
Other
Total
2
29
351
117
499
92
199
254
91
115
751
1
58
280
110
449
59
210
153
152
54
628
Total prepaid expense and
accrued income
1,250
1,076
Parent company (SEK million)
31 Dec 2019
31 Dec 2018
Other prepaid external
expenses
Other accrued revenue
Total
14
1
15
1
–
1
The holder of an NENT Class A share is entitled to 10 voting
rights, the holder of an NENT Class B and NENT Class C share
one voting right. Class C shareholders are not entitled to
dividend payments. The quota value is SEK 2 per share.
There were no C shares outstanding at the year end. Shares
in 2018 refers to MTG’s shares. There were no treasury shares
at year end.
Shares issued
Parent company
2019
2018 1)
Number of
shares paid
Quota value
(SEK million)
Number of
shares paid
Quota value
(SEK million)
NENT Class A
NENT Class B
NENT Class C
Total number of shares issued/total quota value as per 31 December
545,662
66,796,582
–
67,342,244
1
134
–
135
545,662
66,441,462
660,000
67,647,124
25
309
4
338
Non-controlling interest
In subsidiaries not wholly owned, the share of equity owned
by external shareholders is recorded as non- controlling
interest. In cases where option clauses exist, the companies
have been 100% consolidated.
1) Shares in 2018 refers to MTG’s shares.
Paid-in capital/Premium reserve
The paid-in capital arises when shares are issued at a
premium, i.e. shares were paid at a higher price than
the quota value.
Translation reserve in equity
Translation reserve comprises all foreign exchange differ-
ences arising from the translation of the financial statements
of foreign operations to Swedish krona in the consolidated
accounts.
Group (SEK million)
Opening balance 1 January
This year's translation
differences, net of tax
Closing balance 31 December
2019
–77
52
–25
2018
–123
46
–77
101
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share 18
cont.
19
Proposed treatment of unappropriated earnings
Hedging reserve
The hedging reserve comprises the effective portion of the cumulative net change in the fair
value of cash flow hedging instruments related to hedged transactions that have not yet
occurred. Hedging positions are taken to protect the Group against the effects of transaction
exposures in the contracted outflow for the main part of programme acquisitions in foreign
currency.
The Board of Directors does not propose the previously indicated cash dividend of SEK 7.00
per share for 2019 to the upcoming 2020 Annual General Meeting of shareholders. The
Bord of Directors proposes that the un-appropriated earnings be allocated as follows:
Read more about the Board’s statement on proposed treatment of unappropriated earnings
on page 117.
Group (SEK million)
Opening balance 1 January
Recognised in other comprehensive income
Closing balance 31 December
2019
37
13
50
2018
–31
68
37
Retained earnings
Retained earnings comprise of previously earned income.
The following sum in the parent company is avaliable for disposal
by the Annual General Meeting:
Profit brough forward
Net profit for the year
Total
SEK
SEK
SEK
1,447,712,000
311,548,568
1,759,260,568
The board of directors proposes that the unappriprirated earnings be allocated as follows:
Carried forward
Total
SEK
SEK
1,759,260,568
1,759,260,568
102
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share 20
Provisions
21
Accrued expense and prepaid income
Accounting principle
Provision
A provision is recognised in the balance sheet when the Group
has a present legal or constructive obligation as a result of
a past event, and it is probable that an outflow of economic
resources will be required to settle the obligation and the
amount can be reliably estimated. If the effect of when in
time the payment takes place is material, provisions are
determined by discounting the expected future cash flows
at a pre-tax rate that reflects current market assessments
of the time value of money and, where appropriate, the risks
specific to the anticipated liability.
Pension
There are mainly defined contribution pension plans within
the Group. The Group’s payments to defined contribution
plans are reported as costs in the period when the employee
performed the services to which the fee relates. A defined
contribution plan is a post-employment benefit plan under
which an entity pays fixed contributions into a separate
entity and will have no legal or constructive obligation to
pay further amounts.
Group (SEK million)
Opening balance 1 January 2018
Provisions during the year
Utilised during the year
Reversed during the year
Reclassifications
Translation differences
Closing balance 31 December 2018
Opening balance 1 January 2019
Provisions during the year
Utilised during the year
Reversed during the year
Translation differences
Closing balance 31 December 2019
Restructuring
provisions
Royalties and
other provisions
38
38
–43
–
–
–
33
33
170
–49
–3
–
151
401
106
–200
–14
–22
5
276
276
144
–129
–33
5
263
Total
438
144
–243
–14
–22
5
309
309
314
–178
–36
5
414
Group (SEK million)
Accrued expenses
Personnel
Production
Distribution
Royalty
Marketing
Other
Total
Prepaid income
Advertising
Subscription
Production
License and royalty
Other
Total
Total accrued expenses and
prepaid income
Parent company (SEK million)
Accrued personnel expenses
Other accrued expenses
Total accrued expenses and
prepaid income
31 Dec
2019
31 Dec
2018
326
124
73
18
51
399
991
132
592
108
208
49
1,089
308
114
79
24
96
376
997
83
492
78
1
141
796
2,080
1,793
31 Dec
2019
31 Dec
2018
39
23
62
40
–
40
The Group has defined benefit pension plans in Norway
and Sweden. The plans relate to a few employees and the
amount is immaterial. In Sweden there is a multi- employer
defined benefit plan. The Group reports these pension costs
in the same way as defined contribution plans.
103
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share 22
Financial instruments and financial risk management
Capital management
The primary objective of the Group’s capital management is
to ensure financial stability, manage financial risks and secure
the Group’s short-term and long-term need of capital. The
Group defines its capital as equity including non-controlling
interest as stated in the balance sheet.
The Group manages its capital structure and makes
adjustments when necessary due to economic conditions in
its environment. To maintain or adjust the capital structure,
the Group may change the dividend payment to share-
holders, buy-back shares or issue new shares.
The Group monitors capital efficiency using different
ratios, such as net debt, return on capital employed and
equity to assets ratio.
Financial risk management
In addition to business operational risks, the Group is exposed
to various financial risks in its operations. The most important
financial risks are refinancing-, currency-, credit-, and interest
rate risk. The risks during 2018–2019 were regulated by the
financial policy adopted by NENT’s Board of Directors in 2018.
The Group’s financial policy constitutes a framework of
guidelines and rules for financial risk management and finan-
cial activities in general. The policy is subject to a yearly
review. The Group’s financial risks are continuously compiled
and followed up at corporate level by the Group’s treasury
function to ensure compliance with the financial policy. The
parent company’s treasury function is responsible for manag-
ing the financial risks. The aim is to limit the Group’s financial
risks, and ensure that the Group has appropriate and secure
financing for its current needs.
Liquidity in the Group is concentrated with the Group’s
treasury function and in local cash pools. Surplus liquidity
may be invested during a period of maximum six months.
The financial policy includes a special counterparty regulation
by which a maximum credit exposure for various counter-
parties to minimise the risk is stipulated.
Financing and refinancing risk
Financing risk is the risk of not being able to meet the need
for future funding requirements. The Group’s sources of fund-
ing are primarily shareholders’ equity, cash flows from oper-
ations and borrowing. In order to reduce the refinancing risk
the Group strives to diversify the funding sources and matu-
rity tenors and normally initiate refinancing of all loans 12
months prior to maturity. The Group shall at all times strive
for relevant key ratios equal to investment grade rating.
External borrowing is managed centrally in accordance
with the Group’s financial policy. Loans are primarily taken
up by the parent company, and transferred to subsidiaries
as internal loans or capital injections. There are currently no
subsidiaries with external loans and/or overdraft facilities
connected directly to these companies.
a corporate bond for SEK 800 million maturing May 2022
and a corporate bond for SEK 500 million maturing October
2020, all with variable 3-month Stibor interest plus a margin.
The bonds have been issued under the Group’s medium term
note program (with a total frame of SEK 4,000 million). In the
short-term capital market, The Group has an uncommitted
commercial paper program with a frame of SEK 3,500 million
under which certificates for SEK 2,480 million was issued at
the balance sheet date.
The Group also has a five-year committed SEK 4,000 million
syndicated bank facility arranged in August 2018. The facility
was not utilised at the balance sheet date. The revolving
credit facility is unsecured with no required amortisations
and can be paid out in optional currencies. The interest varies
with IBOR (not lower than 0%) depending on the currency
utilised. Covenants for the facility are based on the ratios
total consolidated net debt in relation to consolidated EBITDA
and consolidated EBITDA to net financial expenses. There are
no regulatory external capital requirements to be met by
the parent company or any of the subsidiaries other than the
covenants. The covenants have been fulfilled.
Overdraft facilities within the Group’s cash-pool banks
consist of one overdraft facility of SEK 150 million, one of DKK
50 million, and one of NOK 55 million. In total SEK 278 million
of which nil was drawn at the balance sheet date.
The Group has a SEK 300 million corporate bond with fixed
interest rate maturing July 2026. Additionally the Group has
a corporate bond for SEK 700 million maturing May 2024,
As per 31 December 2019, total short- and long-term
borrow ings amounted to SEK 4,780 (4,372) million including
SEK 4,780 (0) million borrowed from the capital market.
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Net debt
Group (SEK million)
31 Dec 2019 31 Dec 2018
Short-term loans
Liabilities related to MTG
Short-term borrowings
Long-term borrowings
Total long-term borrowings
Total financial borrowings
Cash and cash equivalents
Financial net debt
Lease liability
Lease receivables
Lease liabilities net
2,980
–
2,980
1,800
1,800
4,780
1,238
3,542
823
225
598
–
4,373
4,373
–
–
4,373
428
3,944
–
–
–
Net debt
4,139
3,944
Cash-pool overdraft facilities
where of utilised
Revolving credit facilities
whereof utilised
278
–
4,000
–
375
–
–
–
Parent company (SEK million)
31 Dec 2019 31 Dec 2018
Amount due for settlement
within 12 months
Amount due for settlement
within 13 to 59 months
Amount due for settlement
after 60 months
Total
2,980
4,373
1,500
300
4,780
–
–
4,373
Terms and payback period, gross values
Group 2019 (SEK million)
Bond loan (floating rates)
Bond loan (fixed rate including
interest rate swaps)
Commercial papers
Accounts payable
Total
Group 2018 (SEK million)
Liabilities related to MTG
Accounts payable
Total
Interest
rate
Fixed
interest
rate
Effective
interest
rate
1.29%
3 months
1.33%
1.48%
3–7 years
0.32% 2–9 months
–
–
1.45%
0.35%
–
Interest
rate
Fixed
interest
rate
Effective
interest
rate
1.1%
–
3 months
–
1.1%
–
2019
Total
1,700
600
2,480
2,199
6,979
2018
Total
4,384
1,750
6,134
Maturity
2020
Maturity
2021
500
–
2,480
2,199
5,179
–
–
–
–
–
Maturity
2019
Maturity
2020
4,384
1,750
6,134
–
–
–
Maturity
2022 or
later
1,200
600
–
–
1,800
Maturity
2021 or
later
–
–
–
The interest have been calculated using the current interest rates on 31 December.
The liabilities have been included in the period when repayment may be required at the earliest.
Market risks
Interest rate risk
Interest rate risk is the risk that changes in the market interest
rates will adversely affect cash flow, financial assets and
liabilities. The Group is exposed to interest rate risk through
loans, derivatives, other financial assets and utilised interest -
bearing credit facilities. The Group’s financial policy aim to
gain financial flexibility through a balanced mix between
variable and fixed interest rates and spreading maturities
to match funding needs. During 2018–2019, the weighted
average interest rate period was less than 1 year.
The Group has one interest rate swap with a nominal
amount of SEK 300 million fixing part of the interest of the
corporate bond maturing 2022. Interest paid and received
in the swap is accounted for as interest in the profit and loss,
valuations of future cash flows are accounted for in equity.
Short-term investments and cash and cash equivalents
amounted to SEK 1,238 (428) million as per 31 December and
the average interest rate period on these assets was approx-
imately 0 month. An increase of 1% would increase the inter-
est cost by approximately SEK 37 million. A 1% de crease would
reduce the interest expense by approximately SEK 19 million.
The difference is due to the terms of the loans and assuming
it would be more difficult to benefit fully from a decrease
using committed facilities and potential new commercial
papers.
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Credit risk
Credit risk is defined as the risk that the counterparty in a
transaction will not fulfil its contractual obligations and any
collateral will not cover the claim of the Group. The credit
risk in the Group consists of financial credit risk and customer
credit risk.
Financial credit risk is the risk arising for the Group in its
relations with financial counterparties. The management of
the financial credit risk is regulated in the Group’s financial
policy.
Financial counterparties must have a rating of the equiva-
lent of S&P’s single A rating or higher for larger deposits of
cash or surplus funds. Standardised ISDA agreements are
signed with all counterparties involved in foreign exchange
transactions and interest rate swaps. Transactions are made
within fixed limits and exposures are continuously monitored.
The credit risk with respect to the Group’s accounts receiv-
ables is diversified among a large number of customers, both
private individuals and companies. The Group’s assessment
based on historical data is that there are no write-down
requirements for accounts receivables not due. The majority
of the current outstanding accounts receivables comprise
previously known customers, who are judged to have good
credit worthiness. See also note 16 Accounts receivables.
The Group’s exposure to credit risk amounts to SEK 2,641
(2,659) million as per 31 December. The exposure is based
on the carrying amount for the financial assets, the major
part comprising cash and cash equivalents and accounts
receivables.
Currency risk
Foreign exchange risk is the risk that fluctuations in exchange
rates will adversely affect the income statement, financial
position and/or cash flows. The risk can be divided into trans-
action exposure and translation exposure.
Derivative instruments
The Group uses forward contracts to hedge its exposure to
foreign exchange arising from operational activities and
currency swaps to match the timing of foreign exchange
flows. The major part of contracted programme acquisition
outflows in US dollars is hedged. Derivatives that do not
qualify for hedge accounting due to the rules in IFRS 9 are
accounted for as financial instruments valued at fair value
through profit and loss.
Derivative financial instruments are recognised initially at
cost and remeasured to fair value thereafter. The effective
part of the gain or loss in the cash flow hedge is recognised
in other comprehensive income with the aggregated changes
in value in the hedge reserve in equity. When the forecasted
transaction results in the recognition of programme inventory,
the cumulative gain or loss is removed from equity and in-
cluded in the initial cost of inventory. When a hedging instru-
ment expires, the cumulative gain or loss is recognised in the
income statement.
Currency stated in SEK (SEK million)
Insurable risks
The parent company ensures that the Group has sufficient
insurance coverage, including business interruption, director
and officer liabilities and asset losses. This is done via corpo-
rate umbrella solutions to cover most territories.
Transaction flows
Hedges due in 12 months
Net transaction flows
Effect if SEK falls 5%
Transaction exposure
Transaction exposure arise when inflow and outflow in foreign
currencies are not matched. According to the Group’s finan-
cial policy, the Group shall hedge the major contractual
future currency flows on the basis of maximum 36 months
forward. The corporate treasury department strives to
match inflows and outflows in the same currency and also to
take advantage of natural hedges. Hedging is performed to
protect the Group against the effects of transaction expo-
sures in the contracted outflow for the main part of pro-
gramme acquisitions in US dollars. Approximately 85–100% of
the contracted currency flows related to programme acqui-
sitions for the next 12 months are hedged. The hedging
reserve at year-end amounted
to a total of SEK 57 (58) million. Hedges with a maturity later
than 12 months have a market value of SEK 9 (–1) million at
year-end.
The transaction exposures in the Group occurs when
the subsidiaries have external and internal transactions in
curren cies other than the subsidiary’s functional currency.
Below is the net of hedges and forecasted transaction
exposures for the next 12 months:
USD
EUR
–3,152
2,332
–820
–2,552
–
–2,552
DKK
2,599
–
2,599
NOK
1,378
–
1,378
–41
–128
130
69
GBP
–366
187
–179
–9
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The nominal value of the major hedge contracts amounted to:
Currency stated in SEK (SEK million)
EUR
USD
2019
–
314
2018
–5
361
Accounting for financial instruments
Financial assets and liabilities include cash and cash equiva-
lents, securities, derivative instruments, other financial receiv-
ables, accounts receivables, accounts payable, contingent
considerations and loan liabilities.
The effect of a change in the rate by 5% on all of the out-
standing positions as per 31 December would have been
approximately SEK 126 (164) million, the impact on equity
would be after deduction of tax. Currency swaps amounted
to EUR –67 million and USD 60 million per 31 December.
Translation exposure
Translation exposure is the risk that arises when translating
equity in a foreign subsidiary, associated company or joint
venture. There are no hedging positions for translation
exposure.
Foreign net assets including goodwill and other intangible
assets arising from acquisitions are distributed as follows:
Currency
NOK
EUR
DKK
Other currencies
Total equivalent
SEK value
2019
SEK
million
554
147
242
26
%
57%
15%
25%
3%
2018
SEK
million
475
78
125
140
%
58%
10%
15%
17%
969
100%
817
100%
A 5% change in NOK/SEK would affect equity by approxi-
mately SEK 28 (24) million, in EUR/SEK the effect would be
approximately SEK 7 (4) million and in DKK/SEK approximately
SEK 12 (6) million.
Financial assets at fair value through profit and loss
Shares
The Group’s shareholdings in other companies is non listed.
Changes in the fair values of these shares will impact the
Income statement.
Derivatives
Derivates are recognised as a financial asset at fair value
and realised changes in the value are recognised in profit
and loss and unrealised value changes are recognised in
equity as a result of hedge accounting.
Financial assets at amortised costs
Loans and receivables
Non-derivative financial assets with fixed or determinable
payments that are not quoted in an active market are classi-
fied as current assets, with exception for receivables with
maturities later than 12 months after the balance-sheet date.
These receivables are classified as non-current assets. These
assets comprise accounts receivables and other receivables
and cash and cash equivalents. Receivables are stated at
amortised cost less impairment losses. The receivables are re -
viewed monthly to determine whether there is an indication
of impairment. Such indications include receivables due for
a longer period than 90 days. Doubtful accounts receivables
are reported with the amount at which, they are deemed
likely to be paid.
Financial liabilities at fair value through profit or loss
Derivatives
Derivatives at fair value are recognised as financial liabilities
and the realised changes in the value are recognised in
profit and loss and unrealised value changes are recognised
in equity as a result of hedge accounting.
Contingent considerations and options to acquire
remaining shares in subsidiaries
When a subsidiary is acquired and previous owners remain
as non-controlling interest, the agreement often includes
an option for the minority owners to sell their share of the
acquired company to the Group at a later stage. In such
cases no non-controlling interest is reported but instead a
financial liability is recognised. The liability is reported at the
discounted present value of the redemption amount of the
shares.
Financial assets and liabilities
The financial liabilities at amortised costs are recognised
as liabilities to suppliers, short-term interest-bearing liabil-
ities and long-term interest-bearing liabilities.
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The table below shows the carrying amounts and fair values
of financial assets and financial liabilities, including the levels
in the fair value hierarchy.
The carrying amount of cash and cash equivalents, other
receivables, accounts receivables and receivables from
associated companies and interest- bearing liabilities,
accounts payables and other liabilities represent a reasonable
approximation of fair value.
Group 2019 (SEK million)
Financial assets measured at fair value
Shares and participations in other companies
Forward exchange contracts used for hedging
Interest rate swaps
Total
Financial assets measured at amortised cost
Accounts recievables and other receivables
Cash and cash eqvivalents
Total
Financial liabilities measured at fair value
Foreign exchange swaps
Contingent consideration and options to purchase additional shares
Total
Financial liabilities measured at amortised cost
Long-term borrowings
Short-term borrowings
Accounts payable and other payables
Total
Fair value
hedging
instruments
Fair value
through
profit and
loss
Financial
assets/
liabilitites at
amortised cost
Total
31 Dec 2019
Level 1
Level 2
Level 3
Total
–
77
2
79
–
–
–
3
–
3
–
–
–
–
108
–
–
108
–
–
–
6
17
23
–
–
–
–
–
–
–
–
1,437
1,238
2,675
–
–
–
1,800
2,980
2,593
7,373
108
77
2
188
1,437
1,238
2,675
9
17
26
1,800
2,980
2,593
7,373
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
77
2
79
–
–
–
9
–
9
–
–
–
–
108
–
–
108
–
–
–
–
17
17
–
–
–
–
108
77
2
188
–
–
–
9
17
26
–
–
–
–
Book value equals fair value except for other financial liabilities where the fair value is SEK 16 million higher than the book value.
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Group 2018 (SEK million)
Financial assets measured at fair value
Shares and participations in other companies
Total
Financial assets measured at amortised cost
Accounts recieavables and other receivables
Cash and cash eqvivalents
Total
Financial liabilities measured at fair value
Forward exchange contratcs used for heding
Contingent consideration and options to purchase addtional shares
Total
Financial liabilities measured at amortised cost
Liabilitites related to MTG
Accounts payable and other payables
Total
Fair value
hedging
instruments
Fair value
through
profit and
loss
Financial
assets/
liabilities at
amortised cost
Total
31 Dec 2018
Level 1
Level 2
Level 3
Total
–
–
–
–
–
74
–
74
–
–
–
3
3
–
–
–
–
20
20
–
–
–
–
–
1,327
428
1,755
–
–
–
3
3
1,327
428
1,755
74
20
94
4,372
7,999
12,371
4,372
7,999
12,371
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
74
–
74
–
–
–
3
3
–
–
–
–
20
20
–
–
–
3
3
–
–
–
74
20
94
–
–
–
Book value equals fair value except for other financial liabilities where the fair value is SEK 6 million higher than the book value.
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Parent company (SEK million)
Financial assets measured at fair value
Forward exchange contracts used for hedging
Interest rate swaps used for hedging
Total
Financial assets measured at amortised cost
Receivables from group companies
Accounts receivables and other receivables
Cash and cash eqvivalents
Total
Financial liabilities measured at fair value
Forward exchange contracts used for hedging
Total
Financial liabilities measured at amortised cost
Long-term borrowings
Short-term borrowings
Liabilities to group companies
Accounts payable and other liabilities
Total
Fair value
hedging
instruments
Fair value
through
profit and
loss
Financial
assets/
liabilitites at
amortised cost
Total
31 Dec 2019
Fair value
hedging
instruments
Fair value
through
profit and
loss
Financial
assets/
liabilitites at
amortised cost
Total
31 Dec 2018
77
2
79
–
–
–
–
77
77
–
–
–
–
–
–
–
–
–
–
–
–
6
6
–
–
–
–
–
–
–
–
10,831
73
974
11,878
–
–
1,800
2,980
5,083
105
9,968
77
2
79
10,831
73
974
11,878
83
83
1,800
2,980
5,083
105
9,968
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
13,056
266
–
–
–
–
–
73
11,201
4
11,278
–
–
–
13,056
266
–
–
–
–
–
73
11,201
4
11,278
Book value equals fair value except for other financial liabilities where the fair value is SEK 16 million higher than the book value.
Valuation techniques level 1, 2 and 3
Shares and participations in other companies
Quoted prices in active markets for identical assets or
liabilities are used to determine the fair value.
Contingent consideration
Discounted cash flows at the present value of expected
future payments. The discount rate is risk-adjusted. The
most critical parameters are estimated future revenue
growth and future operating margin.
Forward exchange contracts and interest rate swaps
The fair value is determined using quoted forward
exchange rates at the reporting date and present value
calculations based on high credit quality yielded curves in
the respective currencies.
Financial assets, level 3
Group (SEK million)
Opening balance 1 January
New acquisitions
Closing balance 31 December
2019
3
105
108
2018
3
–
3
110
Financial liabilities, level 3
Group (SEK million)
2019
2018
Opening balance 1 January
New acquisitions
Exercise
Changes in fair value
Closing balance 31 December
20
–
–
–3
17
47
6
–14
–18
20
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Leases
Accounting principle
IFRS 16 Leases, introduces a single accounting model for all leases (i.e. no classification between
finance and operating leases). All leases are recognised on the balance sheet as a right-of-use
asset, representing the right to use the underlying asset, and lease liability. The lease liability is
initially measured at the present value of the future lease payments discounted by the implicit
interest on the lease. When the interest rate cannot be easily determined, funding base rates
with a risk premium are to be used. The expense for operating leases is replaced by depreciation
on the right-of-use asset, and interest expense on the lease liability.
Lease commitments
The Group has identified the following categories of leases; offices, cars and car parks. The
recognition exemption for short-term leases and leases for low value items has been applied.
An interest rate of 0,8%–4,28% (local IBOR rate including riskpremium) has been applied.
The Group has applied the modified retrospective approach, which implies no restatement
of previous periods. For 2018 IAS 17 Leases has been applied, and the expenses for operating
leases recognised on a straight-line basis over the period the asset is used.
Commitmets for future payments on non-cancellable operational leases
Right of use assets
Group (SEK million)
Acquisition values
Change in accounting principle
New leasing contracts
End of leasing contracts
Translation differences
Closing balance 31 December 2019
Accumulated depreciation
Depreciation during the year
End of leasing contracts
Translation differences
Closing balance 31 December 2019
Carrying amount
As per 31 December 2019
Real estate Other leases
Total
606
53
–14
10
655
–98
2
1
–96
559
1
9
–
–
10
–3
–
–
–3
7
Group (SEK million)
2019
2020
2021
2022
2023 and thereafter
Total lease commitments 31 December 2018
Paid minimum lease fee 2018
2018
Change in lease liability
164
150
132
131
425
1,003
149
Group (SEK million)
Real estate Other leases
Change in accounting principle
New leasing contract
End of leasing contract
Interest on lease liability
Payment lease
Translation difference
Closing balance 31 December 2019
855
55
–13
26
–144
35
816
4
6
–
–
–3
–
7
Reconciliation lease commitments (IAS 17) and lease liability (IFRS 16)
Group (SEK million)
1 Jan 2019
whereof long-term
whereof short-term
Operating leasing commitments as at December 31 2018 in accordance with IAS 17
Less short-term leases and leases for low value items
Discounted with funding base rates including risk premium
Lease liability as at 1 January 2019 in accordance with IFRS 16
1 003
–36
–109
859
607
61
–14
10
665
–101
2
1
–99
566
Total
859
61
–13
26
–146
35
823
691
132
111
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Short term leases and leases of low value items
The Group has applied the recognition exemption for short-
term leases and leases for low value items. Lease fees for these
leases are reported as a cost on a straight-line basis over the
lease term. Studio equipment is normally leased on a short-
term basis, and most IT- and office equipment are of low value.
Group (SEK million)
Short term leases
Studio equipment
Leases for low value items
IT and office equipment
Total expense for leases for which the
recognition exemption is applied
2019
21
22
43
23
cont.
Age analysis lease liability
Group (SEK million)
Within 1 year
1–2 years
2–5 years
Over 5 years
Total
Cash flows during period
Group (SEK million)
Amortisation of lease receivables
Amortisation of lease liabilities
Total
Contractual cash flows
Group (SEK million)
Within 1 year
1–2 years
2–5 years
Over 5 years
Total
2019
122
115
314
271
823
2019
33
–121
–88
2019
140
131
355
297
922
Subleases
A substantial part of the London offices are subleased, as at
31 December 2019 the sublease receivable amounted to SEK
225m and sublease income during 2019 amounted to SEK 33m.
24
Future payment commitments
The table below shows future payments for non-cancable
program rights commitments and transponder agreements
at 31 December.
Group (SEK million)
2019
2018
2019
2018
Program rights
Transponders
2019
2020
2021
2022
2023
2024 and later
Total
–
4,192
5,292
3,052
1,863
4,216
18,616
5,143
4,178
3,023
1,325
1,679
–
15,348
–
174
–
–
–
–
174
168
55
–
–
–
–
223
25
Pledged assets and contingent liabilities
Pledged assets
There are no pledged assets in the Group in 2019 and 2018.
Parent company (SEK million)
Guarantees subsidiaries
31 Dec
2019
358
31 Dec
2018
–
The parent company issues guarantees to the benefit of the
subsidiaries. These include mainly rental agreements and
capital coverage.
Contingent liabilities
Various companies within the group are involved in disputes,
with collecting societies, over payment of royalties for the past
use of copyrights and similar rights. Further, NENT companies
are parties in litigations. The Company does not believe that
the outcome of these litigations are likely to have a material
adverse effect on the financial position of the Group.
112
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26
Supplementary information to the statement of cash flows
Adjustments to reconcile net income/loss to net cash provided by operations
Cash paid for interest and corporate tax
Group (SEK million)
2019
2018
Group (SEK million)
Depreciation and amortisation
Write-downs and impariment losses
Writedown of free-TV content and other assets
Total
Provisions
Revaluation of liabilities related to options to acquire shares
Other items
Total
Reconciliation of debts arising from financing activities
327
7
541
875
101
–
–173
–72
201
7
–
208
–135
–3
133
–5
Interest paid
Interest received
Total
Corporate income tax
Parent company (SEK million)
Interest paid
Interest received
Total
Corporate income tax
Group 2019 (SEK million)
Short-term borrowings
Long-term borrowings
Financing to/from MTG
Total
Group 2018 (SEK million)
Financing to/from MTG
Total
Opening
balance 2019
Cash flows
Reclassi-
fication
Other
changes
Closing
balance 2019
–
–
4,372
4,372
2,480
2,300
–4,474
306
500
–500
–
–
–
–
102
102
2,980
1,800
–
4,780
Opening
balance 2018
Cash flows
Reclassi-
fication
Other
changes
Closing
balance 2018
1,110
1,110
3,267
3,267
–
–
–
–
4,372
4,372
2019
–24
5
–19
2018
–67
7
60
–310
–104
2019
2018
–24
5
–20
–2
–
–
–
–
Parent company
All external borrowings are attributable to the parent com-
pany. In addition the parent company has interest-bearing
receivables from and liabilities to other group companies.
At year end interest-bearing receivables from group compa-
nies amounted to SEK 10,831 (13,059) million. Interest-bearing
liabilities to group companies at year-end amounted to
SEK 9,863 (11,201) million. The changes during the year are
explained by a negative cash flow of SEK –890 million.
113
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Average number of employees
2019
Men
Women
666
55
178
48
61
10
1,018
470
57
132
65
78
24
826
Total
1,136
112
310
113
139
34
1,844
2018
Women
376
151
88
40
86
20
761
Men
548
173
132
29
74
7
963
Total
924
324
220
69
160
27
1,724
2019
20181)
23
35
58
22
24
46
2019
2018
Men
67%
100%
57%
62%
Women
33%
–
43%
38%
Men
67%
100%
73%
71%
2019
20181)
Men
67%
100%
40%
58%
Women
33%
–
60%
42%
Men
67%
100%
67%
70%
Women
33%
–
27%
29%
Women
33%
–
33%
33%
Group
Sweden
Norway
Denmark
Finland
United Kingdom
Other
Total
Parent company
Men
Women
Total
Gender distribution senior executives
Group
Board of Directors
CEO
Other senior executives
Total
Parent company
Board of Directors
CEO
Other senior executives
Total
1) Reflects the period 2018-07-01–2018-12-31
114
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Audit fees
(SEK million)
KPMG, audit fees
KPMG, audit related fees
KPMG, tax related fees
KPMG, other services
Total
Group
Parent
2019
2018
2019
2018
12
–
–
3
15
11
–
1
7
19
2
–
–
3
5
2
–
–
5
7
29
Related party transactions
The Group has related party relationships with its subsidiaries,
associated companies and joint ventures (see notes 14 and 15).
All related party transactions are based on market terms
and negotiated on an arm’s length basis.
Until the listing of Nordic Entertainment Group AB (publ) on
Nasdaq Stockholm on March 28, 2019, related party relation-
ship exsisted with the companies within the MTG Group and
the parent company Modern Times Group MTG AB (MTG).
In 2019, companies within the NENT Group paid management
fees to MTG. This was reported in the income statement as
administrative expenses.
Up until the listing, NENT was financed with group internal
loans from MTG. At year-end 2018, these loans totaled SEK
4,373m. In connection with the stock exchange listing, these
loans were redeemed and refinanced externally.
Renumeraton of senior executives
No other transactions than reported in note 7 have been made.
Group (SEK million)
2019
2018
Group (SEK million)
2019
2018
Net sales
Associated companies and joint ventures
MTG
Total
Other income
MTG
Total
Costs
Associated companies and joint ventures
MTG
Total
78
–
78
–
–
–42
–
–42
107
44
151
12
12
–37
–30
–67
Accounts receivables and other receivables
Associated companies and joint ventures
MTG
Total
Accounts payable and other liabilitites
Associated companies and joint ventures
MTG
Total
Financial liabilities
MTG
Total
17
–
17
2
–
2
–
–
25
145
169
–
198
198
4,373
4,373
Other transactions
Shareholders' contribution, MTG
Other transactions with shareholders, MTG
Total
620
2,000
– –5,400
620 –3,401
115
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30
Significant events after the reporting period
29 January – NENT Group reorganising
NENT Studios to futher focus on scripted drama
and international ambitions
NENT Group is reorganising NENT Studios – its content produc-
tion and distribution business that comprises 32 companies in
17 countries – into a new organisation focused on scripted
drama production, bot series and movies, and distribution.
As part of the reorganisation the non-scripted production,
branded entertainment and events businesses will be
divested. NENT Group also intends to bring a minority equity
partner into its scripted drama production business, in order
to contribute to the further development of the output and
operations.
4 February – Henrik Clausen steps down as
NENT Group Non-executive Board Director
Henrik Clausen steps down as Non-executive Board Director
following his appointment as CEO of TDC Group.
13 & 17 March – NENT Group to temporarily reduce
Viaplay sports package prices due to changes in
sports event timings
NENT Group announced that it is temporarily reducing the
prices of its Sports packages on its Viaplay streaming service
in all markets following the postponement of various Nordic
and international sports events due to the global spread of
the Coronavirus. The spread of the virus is having an adverse
impact on the Group’s performance, which will put at risk
NENT Group’s previously stated ambition to deliver profitable
growth for the full year 2020. NENT Group will not report
media rights costs for postponed sports events in its income
statement until such time as the events take place. According
to the terms of its contracts with sports rights owners, NENT
Group expects to receive compensation for any events that
are cancelled due to the spread of the Coronavirus around
the world. NENT Group is not making any new payments for
postponed events.
6 February – NENT Group acquires exclusive rights
to Premier League in Sweden, Norway, Denmark and
Finland from 2022 to 2028
NENT Group. the Noric leading streaming company, has
secured the exclusive Swedish, Norwegian, Danish and Finnish
media rights to the English Premier League, the world’s lead-
ing national football league, in a ground-breaking six year
deal that runs from 2022 to 2028. NENT Group currently holds
the Premier League rights in Sweden, Denmark and Finland
until 2022.
20 March – NENT Group takes further actions to
offset impact of Coronavirus
NENT Group announced that it is implementing a range of
measures to reduce its ongoing costs (excluding sports rights
costs) by approximately SEK 700 million, which will fully impact
on the Group’s reported results in 2020. In addition, NENT
Group’s Board of Directors will not propose the previously
indicated cash dividend of SEK 7 per share for 2019, nor any
executive long-term incentive plan for 2020, to the upcoming
2020 Annual General Meeting of shareholders.
116
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Proposed appropriations of earnings
The following funds are at the disposal of the share holders as at 31 December 2019 (SEK):
Parent company (SEK)
The Board of Directors proposes that income for the period and retained earnings be distributed as follows:
To be carried forward
Total
1,759,260,568
1,759,260,568
The Board of Directors does not propose the previously
indicated cash dividend of SEK 7.00 per share for 2019
to the upcoming Annual General Meeting of share-
holders.
The Board of Directors declare that the consolidated
financial statements have been prepared in accordance
with IFRS as adopted by the EU and give a true and fair
view of the Group’s financial position and results of oper-
ations. The financial statements of the Parent Company
have been prepared in accordance with generally
accepted accounting principles in Sweden and give a true
and fair view of the Parent Company’s financial position
and results of operations.
The statutory Administration Report of the Group
and the Parent Company provides a fair review of the
development of the Group’s and the Parent Company’s
operations, financial position and results of operations
and describes material risks and uncertainties facing
the Parent Company and the companies included in
the Group.
117
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Signatures
The Board of Directors and the Chief Executive Officer
confirm that the annual accounts have been prepared
in accordance with accepted accounting standards in
Sweden, and that the consolidated accounts have been
prepared in accordance with the international account-
ing standards in Regulation (EC) No. 1606/2002 of the
European Parliament and of the Council of July 19, 2002
on the application of international accounting standards.
The annual accounts and the consolidated accounts give
a true and fair view of the Group’s and Parent Company’s
financial position and results of operations.
The Board of Directors’ Report for the Group and the
Parent Company gives a true and fair view of the Group’s
and the Parent Company’s operations, position and results,
and describes significant risks and uncertainty factors that
the Parent Company and Group companies face.
The annual accounts and the consolidated statements
were approved by the Board of Directors and the Chief
Executive Officer on 2 April 2020. The consolidated
income statement and balance sheet, and the income
statement and balance sheet of the Parent Company,
will be presented for adoption by the Annual General
Meeting on 19 May 2020.
David Chance
Chairman of the Board
Anders Borg
Non-Executive Director
Natalie Tydeman
Non-Executive Director
Anders Jensen
President and CEO
Stockholm 2 April 2020
Simon Duffy
Non-Executive Director
Kristina Schauman
Non-Executive Director
Our Audit report was submitted 2 April 2020
KPMG AB
Joakim Thilstedt
Authorised Public Accountant and Auditor in Charge
Hök-Olov Forsberg
Authorised Public Accountant
118
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Audit report
To the general meeting of the shareholders
of Nordic Entertainment Group AB,
corporate id 559124-6847
of the additional report that has been submitted to the
parent company’s audit committee in accordance with
the Audit Regulation (537/2014) Article 11.
Report on the annual accounts
and consolidated accounts
Opinions
We have audited the annual accounts and consolidated
accounts of Nordic Entertainment Group AB for the year
2019. The annual accounts and consolidated accounts
of the company are included on pages 59–118 in this
document.
In our opinion, the annual accounts have been prepared
in accordance with the Annual Accounts Act, and present
fairly, in all material respects, the financial position of the
parent company as of 31 December 2019 and its financial
performance and cash flow for the year then ended in
accordance with the Annual Accounts Act. The consoli-
dated accounts have been prepared in accordance
with the Annual Accounts Act and present fairly, in all
material respects, the financial position of the group as
of 31 December 2019 and their financial performance
and cash flow for the year then ended in accordance
with International Financial Reporting Standards (IFRS),
as adopted by the EU, and the Annual Accounts Act. The
statutory administration report is consistent with the other
parts of the annual accounts and consolidated accounts.
We therefore recommend that the general meeting of
shareholders adopts the income statement and balance
sheet for the parent company and the group.
Our opinions in this report on the the annual accounts
and consolidated accounts are consistent with the content
Basis for Opinions
We conducted our audit in accordance with International
Standards on Auditing (ISA) and generally accepted
auditing standards in Sweden. Our responsibilities under
those standards are further described in the Auditor’s
Responsibilities section. We are independent of the parent
company and the group in accordance with professional
ethics for accountants in Sweden and have otherwise
fulfilled our ethical responsibilities in accordance with
these requirements.This includes that, based on the best
of our knowledge and belief, no prohibited services
referred to in the Audit Regulation (537/2014) Article 5.1
have been provided to the audited company or, where
applicable, its parent company or its controlled companies
within the EU.
We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our
opinions.
Key Audit Matters
Key audit matters of the audit are those matters that,
in our professional judgment, were of most significance
in our audit of the annual accounts and consolidated
accounts of the current period. These matters were
addressed in the context of our audit of, and in forming
our opinion thereon, the annual accounts and consolidated
accounts as a whole, but we do not provide a separate
opinion on these matters.
Recoverability of goodwill and intangible assets
See disclosures 2 and 12 in the annual account and consol-
idated accounts for detailed information and description
of the matter.
Description of key audit matter
The carrying value of goodwill and other intangible assets
such as trademarks and capitalized expenditure as at
31 December 2019 amount to SEK 3.4 billion.
Goodwill and intangible assets with indefinite lives are
required to be tested annually for impairment. Other
intangible assets are tested where there is an impairment
trigger.
The impairment tests are complex and include signifi-
cant judgements. The recoverable value of these assets
is based on forecasting and discounting future cash flows
using assumptions, such as discount rates, revenue fore-
casts and long-term growth, which are inherently judg-
mental, and which could be influenced by management
bias.
Response in the audit
We obtained and considered the groups impairment tests
to assure compliance with the methodology prescribed
by IFRS. We have further evaluated the future cash flow
forecasts and their underlying assumptions including
long-time growth rates as well as the discount rates used.
We have had reviews with management among others
including specific focus on the assumptions used in the
impairment test for Studios, where a reasonable change
in assumptions could result in an impairment.
119
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share We considered management’s sensitivity analysis show-
ing the impact of a reasonable change in assumptions to
determine whether impairment charged was required.
We have further evaluated the disclosures on goodwill
and other intangible assets that have been included in the
annual accounts and the consolidated accounts.
Program rights amortisation
See disclosures 2 and 5 in the annual account and consoli-
dated accounts for detailed information and description
of the matter.
Description of key audit matter
Payments for program rights are reported either as
inventory or as prepaid expenses mainly depending on
the start of the license period. Program rights inventory,
where the license period has started, amount to SEK 2.5
billion as per 31 December 2019. Determining the timing
and amount of program right expense recognized in the
period requires judgement in selection the appropriate
recognition profile and ensuring that this profile achieves
the objective of recognizing inventory expense in line with
the way that it is consumed by the group.
There is a risk that the recognition profile selected by
management does not correctly recognize the expense
in line with consumption.
Response in the audit
We examined the method for expensing program rights
inventory, taking into account the differing genres of pro-
grams, any significant changes in viewing patterns during
the year and other assessments made by the group.
In addition, sample testing on contract were performed to
evaluate acqusition cost and amortization periods.
We assessed whether the carrying value of the bal-
ances are considered recoverable by analyzing the
assets on a portfolio basis and comparing the carrying
value at 31 December 2019 against current year revenue
and forecasts to determine if any indicators of impair-
ment exist.
Other Information than the annual accounts
and consolidated accounts
This document also contains other information than the
annual accounts and consolidated accounts and is found
on pages 1–44 and 123–153. The Board of Directors and
the Managing Director are responsible for this other
information.
Our opinion on the annual accounts and consolidated
accounts does not cover this other information and we
do not express any form of assurance conclusion regard-
ing this other information.
In connection with our audit of the annual accounts and
consolidated accounts, our responsibility is to read the
information identified above and consider whether the
information is materially inconsistent with the annual
accounts and consolidated accounts. In this procedure we
also take into account our knowledge otherwise obtained
in the audit and assess whether the information otherwise
appears to be materially misstated.
If we, based on the work performed concerning this
information, conclude that there is a material misstate-
ment of this other information, we are required to report
that fact. We have nothing to report in this regard.
Responsibilities of the Board of Directors
and the Managing Director
The Board of Directors and the Managing Director are
responsible for the preparation of the annual accounts
and consolidated accounts and that they give a fair
present ation in accordance with the Annual Accounts Act
and, concerning the consolidated accounts, in accordance
with IFRS as adopted by the EU. The Board of Directors
and the Managing Director are also responsible for such
internal control as they determine is necessary to enable
the preparation of annual accounts and consolidated
accounts that are free from material misstatement,
whether due to fraud or error.
In preparing the annual accounts and consolidated
accounts The Board of Directors and the Managing Direc-
tor are responsible for the assessment of the company’s
and the group’s ability to continue as a going concern.
They disclose, as applicable, matters related to going con-
cern and using the going concern basis of accounting. The
going concern basis of accounting is however not applied
if the Board of Directors and the Managing Director intend
to liquidate the company, to cease operations, or has no
realistic alternative but to do so.
The Audit Committee shall, without prejudice to the
Board of Director’s responsibilities and tasks in general,
among other things oversee the company’s financial
reporting process.
120
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Our objectives are to obtain reasonable assurance about
whether the annual accounts and consolidated accounts
as a whole are free from material misstatement, whether
due to fraud or error, and to issue an auditor’s report that
includes our opinions. Reasonable assurance is a high level
of assurance, but is not a guarantee that an audit con-
ducted in accordance with ISAs and generally accepted
auditing standards in Sweden will always detect a mate-
rial misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, indi-
vidually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users
taken on the basis of these annual accounts and consoli-
dated accounts.
As part of an audit in accordance with ISAs, we exercise
professional judgment and maintain professional scepti-
cism throughout the audit. We also:
• Identify and assess the risks of material misstatement of
the annual accounts and consolidated accounts, whether
due to fraud or error, design and perform audit proce-
dures responsive to those risks, and obtain audit evidence
that is sufficient and appropriate to provide a basis for
our opinions. The risk of not detecting a material mis-
statement resulting from fraud is higher than for one
resulting from error, as fraud may involve collusion, for-
gery, intentional omissions, misrepresentations, or the
override of internal control.
• Obtain an understanding of the company’s internal
control relevant to our audit in order to design audit
procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on
the effectiveness of the company’s internal control.
• Evaluate the appropriateness of accounting policies
We must inform the Board of Directors of, among
used and the reasonableness of accounting estimates
and related disclosures made by the Board of Directors
and the Managing Director.
• Conclude on the appropriateness of the Board of
Directors’ and the Managing Director’s, use of the going
concern basis of accounting in preparing the annual
accounts and consolidated accounts. We also draw a
conclusion, based on the audit evidence obtained, as
to whether any material uncertainty exists related to
events or conditions that may cast significant doubt on
the company’s and the group’s ability to continue as
a going concern. If we conclude that a material uncer-
tainty exists, we are required to draw attention in our
auditor’s report to the related disclosures in the annual
accounts and consolidated accounts or, if such disclosures
are inadequate, to modify our opinion about the annual
accounts and consolidated accounts. Our conclusions are
based on the audit evidence obtained up to the date of
our auditor’s report. However, future events or conditions
may cause a company and a group to cease to continue
as a going concern.
• Evaluate the overall presentation, structure and content of
the annual accounts and consolidated accounts, including
the disclosures, and whether the annual accounts and con-
solidated accounts represent the underlying transactions
and events in a manner that achieves fair presentation.
other matters, the planned scope and timing of the audit.
We must also inform of significant audit findings during
our audit, including any significant deficiencies in internal
control that we identified.
We must also provide the Board of Directors with a state-
ment that we have complied with relevant ethical require-
ments regarding independence, and to communicate with
them all relationships and other matters that may reason-
ably be thought to bear on our independence, and where
applicable, related safeguards.
From the matters communicated with the Board of
Directors, we determine those matters that were of most
significance in the audit of the annual accounts and con-
solidated accounts, including the most important assessed
risks for material misstatement, and are therefore the key
audit matters. We describe these matters in the auditor’s
report unless law or regulation precludes disclosure about
the matter.
Report on other legal and regulatory requirements
Opinions
In addition to our audit of the annual accounts and consol-
idated accounts, we have also audited the administration
of the Board of Directors and the Managing Director of
Nordic Entertainment Group AB for the year 2019 and the
proposed appropriations of the company’s profit or loss.
• Obtain sufficient and appropriate audit evidence
We recommend to the general meeting of shareholders
regarding the financial information of the entities or
business activities within the group to express an opinion
on the consolidated accounts. We are responsible for
the direction, supervision and performance of the group
audit. We remain solely responsible for our opinions.
that the profit be appropriated in accordance with the
proposal in the statutory administration report and that
the members of the Board of Directors and the Manag-
ing Director be discharged from liability for the financial
year.
121
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Basis for Opinions
We conducted the audit in accordance with generally
accepted auditing standards in Sweden. Our responsibilities
under those standards are further described in the Auditor’s
Responsibilities section. We are independent of the parent
company and the group in accordance with professional
ethics for accountants in Sweden and have otherwise ful-
filled our ethical responsibilities in accordance with these
requirements.
We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our
opinions.
Responsibilities of the Board of Directors
and the Managing Director
The Board of Directors is responsible for the proposal
for appropriations of the company’s profit or loss. At
the proposal of a dividend, this includes an assessment
of whether the dividend is justifiable considering the
requirements which the company’s and the group’s type
of operations, size and risks place on the size of the
parent company’s and the group’s equity, consolidation
requirements, liquidity and position in general.
The Board of Directors is responsible for the company’s
organization and the administration of the company’s
affairs. This includes among other things continuous
assessment of the company’s and the group’s financial
situation and ensuring that the company’s organization
is designed so that the accounting, management of
assets and the company’s financial affairs otherwise
are controlled in a reassuring manner.
guidelines and instructions and among other matters
take measures that are necessary to fulfill the company’s
accounting in accordance with law and handle the
manage ment of assets in a reassuring manner.
Auditor’s responsibility
Our objective concerning the audit of the administration,
and thereby our opinion about discharge from liability,
is to obtain audit evidence to assess with a reasonable
degree of assurance whether any member of the Board
of Directors or the Managing Director in any material
respect:
• has undertaken any action or been guilty of any omission
which can give rise to liability to the company, or
• in any other way has acted in contravention of the
Companies Act, the Annual Accounts Act or the Articles
of Association.
Our objective concerning the audit of the proposed
appropriations of the company’s profit or loss, and thereby
our opinion about this, is to assess with reasonable degree
of assurance whether the proposal is in accordance with
the Companies Act.
Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance
with generally accepted auditing standards in Sweden will
always detect actions or omissions that can give rise to
liability to the company, or that the proposed appropria-
tions of the company’s profit or loss are not in accordance
with the Companies Act.
As part of an audit in accordance with generally
throughout the audit. The examination of the administra-
tion and the proposed appropriations of the company’s
profit or loss is based primarily on the audit of the accounts.
Additional audit procedures performed are based on
our professional judgment with starting point in risk and
materiality. This means that we focus the examination on
such actions, areas and relationships that are material
for the operations and where deviations and violations
would have particular importance for the company’s
situation. We examine and test decisions undertaken,
support for decisions, actions taken and other circum-
stances that are relevant to our opinion concerning
discharge from liability. As a basis for our opinion on
the Board of Directors’ proposed appropriations of the
company’s profit or loss we examined whether the pro-
posal is in accordance with the Companies Act.
KPMG AB, Box 382, 101 27, Stockholm, was appointed
auditor of Nordic Entertainment Group AB by the general
meeting of the shareholders on the 22 May 2019. KPMG
AB or auditors operating at KPMG AB have been the
company’s auditor since 2019.
Stockholm 2 April 2020
KPMG AB
Joakim Thilstedt
Authorised Public Accountant and Auditor in Charge
The Managing Director shall manage the ongoing
administration according to the Board of Directors’
accepted auditing standards in Sweden, we exercise pro-
fessional judgment and maintain professional scepticism
Hök Olov Forsberg
Authorised Public Accountant
122
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Historical overview
(SEK million if not otherwise stated)
Income statement
Net sales
Sales growth, %
- of which organic growth, %
- of which acquisitions/divestments, %
- of which changes in FX rates, %
Operating income before IAC
Operating margin before IAC, %
Items affecting comparability
Operating income
Operating margin, %
Net income for the year
Cash flow
Cash flow from operations
Change in working capital
Net cash flow from operations
Capital expenditures in tangible and intangible assets
Acquisitions and divestments of operations
Net debt
Total financial borrowings
Cash and cash equivalents
Financial net debt
Net debt
Key ratios
ROCE, %
Net debt to EBITDA ratio
Per share data
Shares outstanding at the end of the period
Basic average number of shares outstanding
Weighted average number of shares after dilution
Basic Earnings Per Share (SEK)
Proposed ordinary dividend/Cash dividend per share (SEK)
Market price of Class B shares at close of last trading day (SEK)
2019
2018
2017
2016
15,671
7.6
6.4
–
1.1
1,545
9.9
–787
758
4.8
590
1,393
–791
602
–176
–15
4,780
1,238
3,542
4,139
27.1
2.2
14,568
6.5
3.8
–
2.7
1,544
10.6
–40
1,504
10.3
1,292
1,496
–380
1,116
–550
–19
4,373
428
3,944
3,944
36.5
2.3
13,688
6.1
5.4
–
0.7
1,495
10.9
75
1,570
11.5
1,294
1,417
–695
722
–154
–62
1,110
89
1,021
1,021
47.5
0.6
12,897
5.0
4.8
0.6
–0.4
1,363
10.6
–65
1,298
10.1
931
953
–369
584
–180
–2
892
33
860
860
60.7
0.6
67,342,244 66,980,902 66,725,249 66,663,816
67,279,875 66,854,133 66,706,398 66,655,996
67,484,565 67,362,405 67,142,319 66,826,825
13.93
–
–
8.77
–
302.80
19.24
6.50
–
19.29
–
–
123
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Alternative Performance Measures
The purpose of Alternative Performance Measures (APMs) is to facilitate the analysis of
business performance and industry trends that cannot be directly derived from financial
statements. NENT Group is using the following Alternative Performance Measures:
• Change in net sales from organic growth, acquisitions/divestments and changes in FX rates
• Operating income and margin before items affecting comparability (IAC)
• Net debt and net debt/EBITDA
• Capital employed and return on capital employed (ROCE)
Reconciliation of sales growth
Since the Group generates the majority of its sales in currencies other than in the report-
ing currency (i.e. SEK, Swedish Krona) and currency rates have proven to be rather volatile,
and due to the fact that the Group has historically made several acquisitions and divest-
ments, the Group’s sales trends and performance are analysed as changes in organic
sales growth. This presents the increase or decrease in the overall SEK net sales on a com-
parable basis, allowing separate discussions of the impact of acquisitions/divestments and
exchange rates.
Group (SEK million)
Broadcasting & Streaming
Organic growth
Acquisitions/divestments
Changes in FX rates
Reported change
Studios
Organic growth
Acquisitions/divestments
Changes in FX rates
Reported change
Group
Organic growth
Acquisitions/divestments
Changes in FX rates
Reported change
124
2019
%
2018
765
–
132
897
338
–
35
373
938
–
165
1,103
6.0
–
1.0
7.0
17.7
1.8
19.5
6.4
–
1.1
7.6
543
–
295
839
–145
3
68
–75
518
3
359
880
%
4.5
–
2.5
7.0
–7.3
0.1
3.4
–3.8
3.8
–
2.6
6.4
Reconciliation of operating income before IAC
Operating income before items affecting comparability refers to operating income
after the reversal of material items and events related to changes in the Group’s struc-
ture or lines of business, which are relevant for understanding the Group’s development
on a like-for-like basis. This measure is used by management to follow and analyse the
underlying profits and to offer more comparable figures between periods.
Operating income before and after IAC
Group (SEK million)
Operating income
Items affecting comparability
Operating income before items affecting comparability
Items affecting comparability
Group (SEK million)
Costs related to the separation and listing of NENT Group
Write down of free-TV content and other assets
Restructuring NENT Group
Revaluation of liabilities related to options to acquire shares
Impariment of goodwill related to closed company
Deconsolidaton of the operations in Tanzania
Total
Items affecting comparability classified by function
Group (SEK million)
Cost of goods sold
Administrative expenses
Other operating income
Other operating expense
Total
2019
758
–787
1,545
2019
–56
–540
–190
–
–
–
–787
2018
1,504
40
1,544
2018
–
–16
–53
14
–6
21
–40
2019
2018
–416
–368
–
–3
–787
–
–53
35
–22
–40
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Reconciliation of net debt/EBITDA before IAC ratio
Net debt refers to the net of interest-bearing liabilities less total cash and interest- bearing
assets. As from 1 January 2019 the net debt also includes lease liabilities net of sublease
recevables and dividend payable. Net debt is used by Group management to track the
debt evolvement of the Group and to analyse the leverage and refinancing needs of the
Group. The net debt to EBITDA ratio provides a KPI for net debt in relation to cash profits
generated by the business, i.e. an indication of a business’ ability to pay off all its debts.
This measure is commonly used by financial institutions to rate credit worthiness.
Reconciliation of Return on Capital Employed (ROCE)
Return on capital employed is a performance measure whereby operating income
before items affecting comparability is put in relation to the capital employed within the
operations. Operating income before items affecting comparability is the main profit
level for which operations are responsible and comprise results before interest and tax.
Capital employed is the sum of current and non-current assets less current and non-
current liabilities, provisions and liabilities at fair value. All items are non-interest-bearing.
Capital employed thus equals the sum of equity and net debt.
Net debt
Group (SEK million)
Short-term borrowings
Liabilities related to MTG
Short-term borrowings
Long-term borrowings
Total financial borrowings
Cash and cash equivalents
Financial net debt
Lease liabilities
Sublease receivables
Lease liabilities net
Net debt
Net debt/EBITDA before IAC, ratio
Group (SEK million)
Operating income before IAC
Depreciation and amortisation
EBITDA 12 months trailing
Net debt
Total net debt/EBITDA ratio
2019
2,980
–
2,980
1,800
4,780
1,238
3,542
823
225
598
2018
–
4,373
4,373
–
4,373
428
3,945
–
–
–
4,139
3,944
2019
1,545
336
1,881
4,139
2.2
2018
1,544
201
1,745
3,944
2.3
Group (SEK million)
2019
2018
Inventory
Accounts receivables
Prepaid expense and accrued income
Other current assets
Other current liabilities
Total working capital
Intangible assets
Machinery, equipment and installations
Right-of-use assets
Shares and participations
Other long-term receivables
Provisions
Other non-current liabilities
Other items included in the capital employed
Capital employed
Average Capital Employed (5 quarters)
Operating income before IAC 12 months trailing
ROCE %
2,551
1,112
4,609
532
–6,923
1,882
3,384
165
566
142
171
–414
–316
3,699
2,428
1,224
3,951
468
–6,598
1,471
3,404
152
–
20
127
–309
–324
3,071
5,581
4,541
5,700
1,545
27.1%
4,229
1,544
36.5%
1) Average capital employed (5 quarters) and Operating income before IAC 12 months trailing has been adjusted for
the estimated effect for IFRS 16 for increased comparability. 2018 periods included in Average capital employed
has been adjusted for Right-to-use assets with SEK 631m, adjusting the average capital employed with SEK 126m
from SEK 5,574m to SEK 5,700m.
125
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Sustainability
reporting
Content
Stakeholder engagement and
materiality determination
Value chain
Membership of associations
Our contribution to the SDGs
Goals and achievements
Data tables
GRI Index
Report scope & boundaries
Independent assurance statement
127
130
131
132
133
135
144
150
1 51
126
Stakeholder engagement and
materiality determination
In order to provide a strong foundation for our sustaina-
bility strategy, we conducted an extensive materiality
assessment in 2018 to help us set our priorities and focus
our efforts. Following a wide stakeholder dialogue, we
considered our social, economic and environmental
impacts in society, and reflected on associated topics
that are important to our stakeholders and substantively
influence their decisions and views.
Our materiality assessment process
To ensure we focus on the most important and impactful
topics, we regularly review our sustainability priorities with
our stakeholders. In 2018, we conducted the first material-
ity assessment for NENT Group. To identify relevant topics
for our business, we conducted a review of relevant docu-
ments and databases; looked at media industry trends,
risks and opportunities for our business and sustainability
related requirements; and also benchmarked against
industry peers. This helped us create a long list of relevant
sustainability topics, which we then filtered through discus-
sions, followed by more than 50 interviews with internal
and external stakeholders on 28 relevant topics. In the
interview process, we examined what governs our stake-
holders’ decisions, and jointly assessed possible economic,
social and environmental impacts of working with a cer-
tain topic. After gathering and assessing our stakeholders’
input from the interviews, we populated a final shortlist of
18 material topics.
Materiality assessment
High
l
s
r
e
d
o
h
e
k
a
t
s
o
t
e
c
n
a
t
r
o
p
m
I
Respond and report
• Safe, fair & inclusive work environment
• Talent attraction, development & retention
• Respecting human rights & freedom of
Key focus, engage and report
• Diversity & equality off & on-screen*
• Promoting local content & creative industry
• Raising awareness & engaging in societal issues
expression
Monitor and address
• Anti-bribery & corruption
• Open dialogue & transparent decision making
• Responsible sourcing and content production
• Providing channels for raising concerns
• Content accessibility
Assess and communicate
• Data protection & privacy
• Responsible advertising
• Protecting minors & vulnerable groups
• Healthy digital viewing habits
• Reducing waste, energy use & carbon emissions
• Empowering media understanding & critical
thinking
Low
Significant impact
High
* Diversity & equality off & on-screen merges two material topics: on-screen representation of diversity, pluralism & equality, and diversity & equality
in the workplace.
GRI 102-46
GRI 102-47
GRI 103-1
GRI 103-2
GRI 103-3
127
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share
After categorising these material topics into topics mostly
relevant for our 1) people and culture, 2) business, and
3) society, we launched a sustainability survey targeting
all our stakeholder groups internally and externally. We
engaged 3,225 people in total, and successfully prioritised
the material topics by importance to our stakeholders, as
well as by the impact that they believe NENT Group can
have in those areas. We then assessed the results from
both the interviews and the sustainability survey together
with management at a vali dation workshop, after which
we finalised our materiality assessment. The materiality
assessment findings formed the foundation of our sustain-
ability strategy and are used to define the key focus areas
as illustrated by the materiality matrix. Our materiality
matrix is composed of four elements:
Monitor and address – Issues we continuously observe,
address and adjust if necessary, in order to ensure
compliance and that we meet stakeholders’ reasonable
expectations. We engage when appropriate, and report
accordingly.
Assess and communicate – Issues about which we
adequately inform relevant stakeholders, engage in a
wider dialogue when needed, and report accordingly.
Respond and report – Issues of higher interest about
which we actively engage to make sure that we meet
stakeholders’ reasonable expectations, interests and
needs. Followed by continuous dialogue and reporting.
Key focus, engage and report – Most significant issues
that are actively addressed and create substantial value
or risk for our business, our stakeholders and society at
large. In focus for our sustainability efforts and followed
by continuous engagement and reporting.
Our stakeholder engagement
We take a proactive approach to stakeholder engage-
ment. Engaging with our stakeholders is a cornerstone of
how we do business. It enables us to keep track of their
expectations and insights on an ongoing basis. The input
we receive guides our work and shapes our everyday
activities, goal setting and reporting. We engaged exten-
sively with our internal & external stakeholders as part of
our materiality assessment in 2018, and the outcome of
this engagement both informed our sustainability strat-
egy and is consistent with the material topics presented
in the report. We have continued to engage with a wide
range of stakeholders in 2019.
Identifying and engaging with our stakeholders
In the initial phase of our materiality assessment, we
conduc ted stakeholder mapping. We identified our stake-
holders as entities or individuals that can reasonably be
expected to be affected by us and our activities, products,
or services; and/or entities or individuals whose actions
can reasonably be expected to affect us. We decided on
a scheme mapping our stakeholders into three categories:
primary internal, primary external, and secondary external
stakeholders. We then mapped our stakeholder groups
based on their impact and interest, ranging from low
to high, and produced a stakeholder group matrix. This
allowed us to target all stakeholder groups in our materi-
ality assessment and guided our assessment of the most
material sustainability topics for NENT Group.
A list of our stakeholder groups, together with the
engagement methods and key topics raised by each
stakeholder group during the materiality assessment in
2018 can be found on the next page.
128
GRI 102-42
GRI 102-43
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Stakeholder group
Communication channels
Key topics
Customers
B2C: video streaming and linear TV
viewers, users of our digital video
networks, radio listeners.
B2B: media agencies and corporations.
Direct dialogue, focus groups and ad-hoc content surveys, social media,
viewing figures, audience appreciation index, customer support channels,
dialogue programs, newsletters, brochures, campaigns, viewing panels,
messag ing activities, listener hotlines, competitions, website, audience
measure ment, interviews, auditory tests, events and concerts.
Data protection and privacy; respecting human rights and freedom of
expression; safe, fair and inclusive work environment; protecting children,
minors and vulnerable groups; responsible sourcing and content production;
diversity and equality in the workplace; responsible advertising.
Shareholders
Annual General Meeting, Annual Report, quarterly reports, press releases,
general and Environmental Social Governance roadshows and conferences
and Capital Markets Day.
Responsible sourcing and content production; respecting human rights
and freedom of expression; diversity and equality in the workplace; data
protection and privacy; open dialogue and transparent decision making.
NENT Group’s Board of Directors
Board of Directors meetings and interviews.
Employees
Industry peers
Annual Employee Survey, intranet, newsletters, policies and guidelines,
meetings, daily dialogues in person and through dialogue tools.
Continuous dialogue with colleagues and other professionals and quarterly
peer meetings through the Responsible Media Forum.
Regulators
OfCom and other authorities that
set the rules for what we do.
Continuous dialogue via mail, telephone and working groups.
Also information through bulletins.
Talent attraction, development and retention; providing channels for raising
concerns; open dialogue and transparent decision making; data protection
and privacy; anti-corruption.
Safe, fair and inclusive work environment; respecting human rights and free-
dom of expression; protecting children, minors and vulnerable groups; open
dialogue and transparent decision making; anti-corruption.
Respecting human rights and freedom of expression; protecting children,
minors and vulnerable groups; anti-corruption; open dialogue and
transparent decision making; safe, fair and inclusive work environment.
Open dialogue and transparent decision making; respecting human rights
and freedom of expression; data protection and privacy; safe, fair and inclu-
sive work environment; protecting children, minors and vulnerable groups.
NGOs and trade associations
Associations we are members of,
and non-governmental organisations
with which we work.
Continuous dialogue, face-to-face meetings, Task Force calls, association
events with key stakeholders including political institutions and regulators,
conferences, webinars, monthly board meetings, weekly email discussions,
long-term projects, joining advocacy efforts through conducting interviews.
Respecting human rights and freedom of expression; protecting children,
minors and vulnerable groups; empowering media understanding, critical
thinking and self-expression; raising awareness about societal issues;
on-screen representation of plurality, diversity, pluralism and equality.
Business partners
Companies whose products and
services we buy and organisations
we partner with.
Daily or weekly phone calls and face-to-face meetings, Supplier Code of
Conduct, site visits, communication regarding set-up routines on GDPR
and Supplier Code of Conduct compliance as well as consumer regulatory
standards.
Respecting human rights and freedom of expression; anti-corruption;
responsible sourcing and content production; diversity and equality in the
workplace; on-screen representation of plurality, diversity, pluralism and
equality.
GRI 102-40 GRI 102-44
129
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Buying and creating content – Creating our own content
is a major part of our strategy (promoting Nordic story-
telling and the creative industry). When buying content,
our core suppliers include major Hollywood studios and
sports rights providers (media rights acquisitions and con-
tent licensing), as well as local studios and channel owners.
NENT Studios are producing content for internal and
external use.
Packaging – To optimise the interests of our stakeholders,
we decide on where to put, air, schedule or include differ-
ent content, and at what price to make it available.
Content distribution – We make our content available
to customers and consumers via multiple linear and on-
demand TV channels and streaming services, as well as
radio stations.
Consumer experience – Our audience is as diverse as
society as a whole. We aim to create experiences that
engage, entertain and inform all of our audiences. This
demands creativity from us but also carries a responsibility
to make sure that the content is aligned with the core
values of the company.
Customer insight & dialogue – We have an ongoing
dialogue with all of our stakeholders, in order to improve
our products and services. This dialogue includes focus
groups, surveys and interviews, and ensures that we
deliver our audiences the best possible quality, while
also offering our business customers the opportunity to
further build their brands.
Value chain
As the Nordic region’s leading entertainment provider,
we offer a wide range of products and services in the
Nordic and international markets. Our broadcasting and
streaming segment primarily provides TV and streaming
services in the Nordic region, as well as radio networks
and streaming services in Sweden and Norway. NENT
Studios creates, produces and sells scripted, non-scripted
and digital content for in-house and third-party media
companies and content distributors. The main revenue
streams are from advertisi ng, subscriptions, wholesale
distribution, and the sales of productions or format
licenses.
Buying &
creating
content
Packaging
Content
distribution
Consumer
experience
Consumer
insight &
dialogue
130
GRI 102-9
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Membership of associations
We are a member of global partnerships, various media industry associations, national
and international organisations, advocacy groups and additional bodies. These
member ships are focused on advancing the 2030 Agenda for Sustainable Development;
engaging with EU institutions to achieve a balanced and appropriate framework that
encourages investments in the media sector; advancing the use of digital and new
technol ogies that enable transformation; promoting ethical standards and professional
integrity; strengthening freedom of speech; responsible advertising; collaboration on
sustaina bility issues in the media sector; and promoting effective anti-piracy legislation.
Organisation
RMF
AAPA
NCP
Responsible Media Forum
The Audio-visual
Anti-Piracy Alliance
Nordic Content Protection
Description
Partnership between leading global media companies, collaborating on
both social and environmental challenges facing the sector.
European organisation addressing
media piracy issues.
Cross-industry Nordic body addressing piracy through intelligence
sharing with enforcement agencies.
Organisation
ACT
COBA
EGTA
EDRA
WorldDAB
The Asociation of Commercial
Television in Europe
The Commercial
Broadcasters Association
The European Group of
Television Advertising
The European Digital
Radio Alliance
Description
Represents the interests of leading
commercial broadcasters in Europe.
Engages with EU institutions to achieve
appropriate regulatory framework
that encourages investment and
growth in the media sector.
Industry body for UK based
multichannel broadcasters in
the digital, cable and satellite
television sector and their on-
demand services.
Aims to support television and
radio sales houses in monetising
audio and audiovisual content
through advertising solutions,
regardless of device or platform.
Supported by the European Broad-
casting Union and has the goal of
making digital radio the standard
and preferred choice of listeners
across Europe.
Global industry forum aiming to
facilitate the adoption and imple-
mentation of digital radio based
on DAB/ DAB+ standards.
Organisation
Norsk Presseforbund
FWCE
Reklam-ombudsmannen
MMS
IAB
The FreeWheel Council for
Premium Video Europe
Mediamätning i Skandinavien
Interactive Advertising
Bureau
Description
Joint body for Norwegian mass
media that aims to promote ethical
standards and professional integrity
and to strengthen and protect
freedom of speech, media and
information.
Serves the collective interest
of those in the premium video
industry through leadership posi-
tions, research, and advocacy
promoting the premium video
economy.
A self-regulatory organisation,
handling complaints about adver-
tising and provides information,
guidance and training in the field
of ethical marketing.
Owner together with other media
houses. MMS measures, but also
develops methods for measuring,
consumption of moving images in
Sweden.
Aiming to optimise online
marketing in Sweden. Works
through specialised task forces
that define various standards
and guidelines.
GRI 102-13
131
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Our contribution to the SDGs
To address global challenges and create value for all our stakeholders, NENT Group is
committed to eight of the UN Sustainable Development Goals that are in line with our sus-
tainability strategy. We are also members of the UN Global Compact and UN Sustainable
Development Goals Media Compact Initiative. Below we illustrate some examples of how
we have made a positive impact in society, and contributed towards the 2030 Agenda for
Sustainable Development, and the achievement of the SDGs in 2019.
Goal and target
Impact and progress
Goal and target
Impact and progress
3. Good health
and wellbeing
Reduce mortality from
non-communicable
diseases and promote
mental health (3.4).
We have organised a Diabetes Gala in Sweden every year
since 2017. In 2019, we raised over SEK 8 million to support
research and raise awareness about the disease.
We have initiated the pan-Nordic BEAT Diabetes Foun-
dation, an independent entity in which we will invest SEK
2.5 million every year for the next five years. The aim is to
raise awareness and drive positive change in health tech,
healthy lifestyles, and inclusion and wellbeing.
12. Responsible
consumption
and production
Adopt sustainable
practices and inte-
grate sustainability
practices in reporting
(12.6) and promote
universal understand-
ing of sustainable
lifestyles (12.8).
We continuously report on our sustainability work, both on
our website and in our integrated Annual & Sustainability
Report. We promote sustainable lifestyles, both in our
content and our business.
By being transparent with our sustainability work and
promoting it both internally and externally, we are certain
that it will attract and retain both investors, employees
and new audiences.
5. Gender
equality
8. Decent work
and economic
growth
10. Reduced
inequalities
End discrimination
against women and
girls (5.1). Ensure
participation in lead-
ership and decision
making (5.5).
Promoting policies to
support job creation
(8.3). Economic growth
and protecting labour
rights and promoting
safe working environ-
ments (8.8).
Promote universal,
economic and political
inclusion (10.2). Ensure
equal opportunity and
end discrimination (10.3).
In 2019, we hosted industry-wide dialogues to highlight the
importance of gender equality. We mapped the gender
equality challenges and enablers in our organisation and
our content. We also created editorial guidelines.
In 2020, we will launch a recognition concept to pro-
mote new and diverse talents in our industry and help
ensure our content better reflects the diversity of our
audiences.
Our focus on Nordic storytelling leads to job creation oppor-
tunities in the region, especially in creative areas.
Offering a safe and healthy working environment is one
of the key ideas behind our new values. In 2019, we mapped
our challenges and enablers in this area. In 2020, we will
focus on reinforcing our whistleblowing process and on
raising awareness about health and safety in the workplace.
This work will increase employee satisfaction, enabling us
to create better content and attract new talents.
We have focus groups for Equality, Diversity and Inclusion
who evaluate our work both on and off the screen. In 2019,
we identified and defined a gender balanced and diverse
top talent pool and succession planning process. We also
recruited our first-ever Head of Diversity and Inclusion.
We also engaged with our suppliers to ensure the require-
ments of our Supplier CoC, including non-discriminatory
actions, are met.
When we promote equal opportunities we nurture
a culture that is inclusive both inside and outside of
NENT Group.
13. Climate action
Build knowledge and
capacity to meet
climate change (13.3).
We constantly raise awareness internally about climate
issues and take actions to reduce our climate footprint.
In 2019, we initiated a Green Working Group with repre-
sentatives from all our markets to promote greener
behaviour. In 2020, we will launch a Green Awareness
Week in all markets to raise employee awareness further.
16. Peace, justice
and strong
institutions
Substantially reduce
bribary and corrup-
tion in all its forms
(16.5).
We promote a fair and transparent market where every-
body can compete on equal terms. We conduct business
responsibly and have established routines to ensure our
major suppliers support our ethical standards.
We are reviewing the implementation of the Supplier
CoC and reinforcing our responsible sourcing processes.
17. Partnerships
for the goals
Enhance the global
partnership for sustain-
able development
(17.16).
We seek partnerships to enhance our sustainability work.
In 2019, we worked with several partners, e.g. Reach for
Change and Generation PEP to promote a better world
for children.
We also have a number of industry anti-piracy partner-
ships. In 2020, we will step up our fight against diabetes by
starting the pan-Nordic BEAT Diabetes Foundation with
partners.
132
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Goals & achievements
Setting and following up on realistic and measurable goals that are aligned with our
strategy is a key success in making sure that we focus on the right things and review our
goal setting, especially in the context of a fast moving and changing industry. Below we
present long term goals for 2021, together with the targets and progress so far.
Goals 2019–2021
Targets and progress 2019
Targets 2020
SDGs
DEVELOPING NORDIC STORYTELLING & THE CREATIVE INDUSTRY
Invest in Nordic storytelling promoted globally
Promote Nordic storytelling by using our platforms and reach
Target: Increase numbers of Viaplay original
premieres from 10 in 2018.
Progress: Reached 21 in 2019.
Target: Develop recognition concept to promote
talents in the creative value chain.
Progress: Due to the reorganisation this was only
initiated but then postponed to 2020.
PROMOTING AN EQUAL, DIVERSE & INCLUSIVE SOCIETY
Increase number of Viaplay original
premieres from 21 to 30.
8.3 Promote policies to support job creation
and growing enterprises
Launch recognition concept to promote
talents in the creative industry.
For our Nordic scripted productions, strive to reach and
maintain 50/50 gender balance in the creative value
chain by 2021 (baseline 44% women in 2019)
Target: Map gender balance in our content value
chain.
Progress: Mapping done.
For our Nordic scripted productions,
strive to reach at least 47% women
in the creative value chain.
Improve our EDI work and increase amount of employees
answering “works well” or “works excellently” from 88% in 2019
to 90% in 2021 in the engagement survey on the question: ‘‘Do
you feel that all employees have the same opportunities and
duties regardless of gender, gender identity or expression,
ethnicity, religion or other belief, disability, sexual orientation,
or age?’’
Raise awareness and form partnerships for increased
equality, diversity & inclusion
Target: Identify EDI challenges, enablers and develop
improvement plan including metrics.
Progress: Recruitment of Head of Diversity and Inclusion.
Establish two-way mentorship pilot
programme to empower talents,
diversity & enhance knowledge sharing.
Target: Create storytelling & engage for diabetes
and healthy lifestyles.
Progress: 3rd consecutive Diabetes gala and
a Diabetes documentary.
Include unconscious bias in the value
training. Engage all managers and
80% of all employees in the training.
Establish Diabetes foundation as
independent entity together with
at least four partners.
3.4 Reduce mortality from non-communicable
diseases and promote mental health
5.1 End discrimination against women and girls
5.5 Ensure full participation in leadership and
decision-making
10.2 Promote universal, social, economic and
political inclusion
10.3 Ensure equal opportunities and end
discrimination
17.16 Enhance the global partnership for
sustainable development
133
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share
Goals 2019–2021
Targets and progress 2019
Targets 2020
SDGs
NURTURING OUR CULTURE
Improve value awareness and increase rating on questions
regarding values in engagement survey (BEAT index) from
80% in 2019 to 82% in 2021
Target: Develop Culture & Values training for all
managers and initiate further rollout to all employees.
Progress: The training was developed and initiated.
Continue values training with a minimum
of 80% of employees.
5.5 Ensure full participation in leadership and
decision- making
8.8 Protect labour rights and promote safe working
environments
10.3 Ensure equal opportunities and end discrimination
Develop career opportunities and increase rating on the
question “Are you satisfied with the career opportunities within
NENT” from 48% in 2019 to 60% in 2021 in engagement survey
Target: Identify a gender balanced & diverse top
talent pool and succession planning.
Progress: All done.
Review the process for talent acquisition
and succession planning from an EDI
perspec tive. Initiate activities.
Increase the perception of wellbeing among employees
and increase rating on questions regarding wellbeing in the
engagement survey (PAI index) from 76% in 2019 to 78% in 2021
Target: Review and revise policies & benefits for all
employees, at all stages of life. Also raising awareness
on travel and workplace security.
Progress: E.g. reviewed parental policy and on going
information on travel security. Must be continued in 2020.
Review and identify challenges and
enablers for healthier and more safe
workplaces, including safe travelling.
COMMITTING TO OUR CONDUCT
Ensure that awareness of our Code of Conduct, principles
& values (including data privacy) are embedded in daily
activities and business for all employees
Address and engage with all identified high-risk suppliers,
to ensure committment to our ethical standards by 2021
Reduce total CO2 emissions from business travel, facilities
and energy use by 10% by 2021 (base year 2019)
WE PRODUCING QUALITY CONTENT
Target: Evaluate implemented CoC rollout programme
and improve as needed. Launch upgraded network of
Data Protection Managers.
Progress: Evaluation done and upgraded network
initiated.
Target: Map existing supply chain to identify suppliers
with critical sustainability risks, and initiate a process
for engaging with all such high-risks entities.
Progress: Initiated in Q4 2019.
Target: Set launch plan for green awareness week
and green initiatives in all markets. Initiate collabora-
tion with landlords and smart green travel tips when
booking tickets.
Progress: All done.
Launch CoC training and reach 85% in
awareness about our CoC amongst the
employees and perform targeted training
for employees in high risk areas. Finalise
recruitment of network.
Continue mapping existing supply chain
to identify suppliers with critical sustaina-
bility risks and data processors with GDPR
risks, and initiate a process for engaging
with all such high-risks entities.
Continue activities from 2019 and reduce
total CO2 emissions from business travel,
facilities and energy use by 5% in 2020
(base year 2019).
13.3 Build knowledge and capacity to meet
climate change
16.5 Substainally reduce corruption and bribery
Improve the family experience of our Viaplay platform
for safe & trusted digital experience
Target: Develop and implement content Editorial
Guidelines. Launch digital experience with multiple
user-profiles for child-friendlier viewing & interaction.
Progress: All done.
Establish kids & parents focus groups for
all our kids original productions to ensure
that our content & platform is responsible,
educative and entertaining.
Improve accessibility across all our platforms by exceeding
regulations and increasing on accessible content (subtitling,
audio description and sign language)
Target: Broadcast content on our channels with audio
descriptions (10%) and subtitles (70%).
Progress: All done.
Introduce audio descriptions and signed
language content onto our on demand
platforms.
10.2 Promote universal, social, economic and
political inclusion
12.6 Encourage companies to adopt sustainable
practices and sustainability reporting
12.8. Promote universal understanding of sustainable
lifestyles
134
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share
Data tables
WORKFORCE DATA
GRI 102-8
Information on employees & other workers
Headcount
Permanent
Nordics
CEE, UK & US
Temporary
Nordics
CEE, UK & US
Total
Full-time
Part-time
Total
Men
944
873
71
121
119
2
1,065
938
6
944
2019
Women
798
698
100
113
109
4
911
774
24
798
Total
1,742
1,571
171
234
228
6
1,976
1,712
30
1,742
Men
963
882
81
88
85
3
1,051
959
4
963
2018
Women
761
658
103
79
73
6
840
744
17
761
Total
1,724
1,540
184
167
158
9
1,891
1,703
21
1,724
Employees and workers
All workforce data in the sustainability reporting relates to
employees only (an exception is the injury rate, which covers
both employees and workers). Employees are defined as
people with a permanent or temporary contract at NENT
Group. Workers are people wo work for NENT Group without
being employees, such as consultants, contractors, freelancers
and self-employed people.
Headcount
The number of employees in all tables is expressed as head-
count as of 31 December 2019 and include both permanent
and temporary employees. There are two exceptions:
i) One company reported an average FTE 2019 number
instead of a full headcount number as of 31 December
2019, due to data availability limitations.
ii) Data relating to full-time and part-time employees is
based on permanent employees only.
Data collection
The majority of data was extracted from internal HR systems,
payroll systems, and manually populated files. The remaining
data was derived from employee surveys, accounting pro-
grams, and employment contracts. Strix Bene lux, which is
based in the Netherlands, was excluded from the 2019 data
due to an ongoing reorganisation process.
Regions
‘Nordics’ includes Sweden, Denmark, Norway and Finland.
‘CEE, US & UK’ includes Bulgaria, Czech Republic, Hungary,
Latvia, Lithuania, Netherlands, Romania, Slovakia, Slovenia,
the United Kingdom and the United States.
Workers’ contribution
In 2019, a significant part of NENT Group’s work in all regions
was performed by workers who are not employees. This
work included production and post-production, casting and
talent services, photography, voice-overs, logistical assistance,
office coordination, production management and coordina-
tion, showrunning, project management, telemarketing, pay-
roll support, sales, scriptwriting, editing, legal consultancy,
technical assistance, market research, graphic design, finance,
business administration, sales and business development
services. In this context, a ‘significant part’ means that:
i) workers performed activities that are core for NENT
Group’s business
ii) or: the work performed was sufficiently crucial to the
business and NENT Group could not operate without it
iii) or: more than 50% of the total workforce contained
workers who are not employees.
In 2019, the first two criteria were met at NENT Group. It can
therefore be concluded that a significant part of the work at
NENT Group in 2019 was carried out by workers who are not
employees.
GRI 102-4
135
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share GRI 401-1
New employee hires & employee turnover
2019
2018
Nordics
CEE, UK & US
Total
Nordics
CEE, UK & US
Total
Number
% Number
% Number
% Number
% Number
% Number
%
352
20%
24
14%
376
19%
340
20%
39
20%
379
20%
175
177
50%
50%
132
211
9
37%
60%
3%
5
19
8
16
–
21%
79%
33%
67%
–
180
196
48%
52%
201
139
59%
41%
17
22
44%
56%
218
161
58%
42%
140
227
9
37%
60%
3%
154
180
6
45%
53%
2%
19
20
–
49%
51%
–
173
200
6
46%
53%
2%
299
17%
30
17%
329
17%
313
18%
42
22%
355
19%
163
136
16%
17%
61
217
21
14%
18%
12%
9
21
6
20
4
12%
20%
20%
15%
36%
172
157
16%
17%
201
112
20%
15%
67
237
25
15%
17%
15%
120
176
17
33%
15%
13%
18
24
16
25
1
21%
22%
44%
17%
8%
219
136
21%
16%
136
201
18
34%
15%
13%
Total new hires
Split by gender
Men
Women
Split by age group
<30
30–50
>50
Total turnover
Split by gender
Men
Women
Split by age group
<30
30–50
>50
New hires is defined as all employees joining the company
for the first time. This excludes transfers of existing employ-
ees within NENT Group, as well as job promotions which are
reported separately as internal recruitment.
The total new hires rate is calculated against the total
number of employees at NENT Group. The total new hires
rates per region are calculated against the total number of
employees for each region. The splits by gender and age
group are calculated against the total new hires number.
Total turnover covers all employees who left their employ-
ment at NENT Group for any reason, including resignation,
redundancy, leaving during probation period, end of tempo-
rary employment or retirement.
The total turnover rate is calculated against the total
number of employees at NENT Group. The total turnover
rates per region are calculated against the total number of
employees for each region. The splits by gender and age
group are calculated against the total number of employees
in each category.
Internal recruitment
Men
2019
Women
Total
Men
2018
Women
Total
Number
% Number
% Number
%
Number
% Number
% Number
%
Internally recruited
48
4.5%
51
5.6%
99
5.0%
50
4.8%
39
4.6%
89
4.7%
The internal recruitment rates refer to the number of
employees recruited to their current position from another
position within NENT Group and are shown in relation to the
total number of employees in each category. The figures
include job promotions, and internal transfers into a new
role, regardless of whether the position has been externally
advertised.
136
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share GRI 102-41
Employees covered by collective bargaining agreements
2019
2018
Number
% Number
%
The total number of employees was used as a basis for
calculating the percentage of employees covered by
collective bargaining agreements.
Proportion of
employees covered
90
5%
74
4%
GRI 402-1
Minimum notice periods regarding operational changes
Average minimum number of weeks
GRI 401-3
Parental leave (PL)
Number of employees entitled to PL
Number of employees who took PL
Proportion of employees who took PL
2019
6
The average minimum number of weeks was calculated by
taking an average of all minimum notice periods reported
by all NENT Group companies. Data was not available for
2018 since this GRI indicator was introduced in 2019.
In some companies with collective bargaining agreements,
the minimum notice period and terms for consultation and
negotiation are specified in an agreement regarding opera-
tional changes.
2019
2018
Men Women
Total
Men Women
Total
993
64
6.5%
838
77
9.1%
1,831
141
7.7%
994
51
5.1%
786
68
8.7%
1,780
119
6.7%
Employees entitled to PL
At NENT Group, employees’ entitlement to PL is recognised
and followed as prescribed by law. In some companies, all
employees (both permanent and temporary) are entitled
to PL. In other companies, only permanent employees are
entitled.
Employees who took PL
This covers employees who have taken PL during the year
reported. The proportion of employees who took PL is
calculated against the number of employees who are
entitled to PL.
GRI 103-1
GRI 103-2
GRI 103-3
137
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share GRI 403-2 Work-related injuries, diseases, fatalities, lost days and absence
Work-related fatalities (number)
Work-related injuries (number)
Occupational diseases (number)
Lost days from work (number)
Days absent from work (number)
Work-related injury rate*
Nordics
CEE, UK & US
Occupational disease rate*
Nordics
CEE, UK & US
Lost days rate*
Nordics
CEE, UK & US
Absent days rate**
Nordics
CEE, UK & US
* per 1 million working hours
** per 100 working days
2019
2018
Men Women
Total
Men Women
Total
–
1
4
181
605
0.9
–
13.5
1.9
2.0
–
84.0
90.2
–
N/A
1.9
N/A
–
5
2
273
868
2.7
2.4
4.8
1.1
1.2
–
148.1
167.1
–
N/A
3.9
N/A
–
6
6
454
1,473
1.8
1.1
8.3
1.5
1.7
–
113.5
124.7
–
N/A
2.7
N/A
–
2
1
60
145
0.9
1.0
–
0.5
0.5
–
28.2
30.7
–
N/A
N/A
N/A
–
3
1
45
307
1.8
2.0
–
0.6
0.7
–
26.5
30.4
–
N/A
N/A
N/A
–
5
2
105
452
1.3
1.5
–
0.5
0.6
–
27.4
30.6
–
N/A
N/A
N/A
Work-related injury rate
This covers both employees and workers and is defined as
a non-fatal injury arising from, or in the course of work duties.
It includes minor (first-aid) injuries. In 2018, there were five
injuries at NENT Group in Sweden that are excluded from
the 2018 year’s figures since it was not possible to report the
gender of the injured employees. Due to the low number
of injuries, this report does not give a regional breakdown
of the types of injuries.
An injury can be reported by an employee, internal safety
representative, manager or other. Reporting and recording
of injuries is carried out in various ways, such as through
138
internal HR, payroll or service desk systems; directly to an
office, HR department, executive or event manager via
email or word of mouth; externally by insurance funds and
companies; or manually in excel files, online documents or
physical files.
Occupational disease rate
This relates to employees only and covers diseases arising
from a work situation or activity, or from a work-related
injury.
Lost days rate
This relates to employees only and is defined as working days
where an employee is unable to perform their usual duties
because of an occupational disease or accident Lost days
are reported as scheduled working days, beginning to count
the day after the accident.
Absent days rate
This relates to employees only and is defined as days of
absenteeism in each category in relation to the total number
of employees in that category and 253 working days per
year. N/A means that due to changes in data collection
methods in 2019 compared to 2018, data was available only
for NENT Group in Denmark, Norway and Sweden in 2019,
however excluding all NENT Studios companies, and Viasat
Sales AB in Sweden. All data from 2018 is excluded for the
same reason.
All rates are calculated by dividing the number in each
category by the total amount of working hours or days in the
same category. For all rates, the yearly working hours for one
employee are assumed to be eight hours per day for 253 days.
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share GRI 404-1
Average yearly employee training
Hours
CEO, EVPs, CxOs, Sub.CEOs, SVPs
VPs, Heads of
Managers
Non-managers
Total
2019
2018
Men Women
Total
Men Women
Total
1.8
6.9
3.6
2.4
2.9
3.1
3.0
4.9
2.5
2.9
2.4
5.0
4.3
2.4
2.9
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Figures are calculated against the total number of employees
for each category. Training hours at NENT Group in Sweden
are excluded as it is not possible to report gender or employee
category. At NENT Group in Sweden, there were on average
5.6 training hours in 2019.
N/A means that data was not available due to changes
in employee categories and method of collecting data.
Managers are defined as employees with personnel respon-
sibility. This employee category also includes team leaders.
Non-managers are defined as employees without personnel
responsibility.
GRI 404-3
Performance and Development Appraisals (PDA)
Proportion of employees who received PDA
Men Women
Total
Men Women
Total
2019
2018
CEO, EVPs, CxOs, Sub. CEOs, SVPs
VPs, Heads of
Managers
Non-managers
Total
62%
62%
93%
73%
74%
72%
81%
100%
72%
77%
67%
71%
97%
73%
76%
N/A
N/A
73%
53%
59%
N/A
N/A
67%
64%
66%
N/A
N/A
70%
58%
62%
The PDA rate is defined as the percentage of employees in
each category who participated in a PDA. Gender and
employee category data was not available in 2018 or 2019 for
NENT Group in Sweden, or in 2019 for NENT Group in Finland.
• At NENT Group in Sweden, 76% of employees participated
in a PDA in 2019 and 84% in 2018.
• At NENT Group in Finland, 74% of employees participated
in a PDA in 2019.
N/A means that data was not available due to changes in
employee categories. Managers are defined as employees
with personnel responsibility. This employee category also
includes team leaders. Non-managers are defined as
employees without personnel responsibility.
139
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share GRI 405-1
Diversity of governance bodies and employees
Part of total workforce
CEO, EVPs, CxOs, Sub. CEOs, SVPs
VPs, Heads of
Managers
Non-managers
By gender
Board of directors
Women
Men
CEO, EVPs, CxOs, Sub. CEOs, SVPs
Women
Men
VPs, Heads of
Women
Men
Managers
Women
Men
Non-managers
Women
Men
Total
Women
Men
140
2019
3%
10%
10%
77%
2019
33%
67%
45%
55%
43%
57%
47%
53%
46%
54%
46%
54%
2018
N/A
N/A
10%
77%
2018
33%
67%
N/A
N/A
N/A
N/A
48%
52%
44%
56%
44%
56%
By age
Board of directors
<30
30–50
>50
CEO, EVPs, CxOs, Sub. CEOs, SVPs
<30
30–50
>50
VPs, Heads of
<30
30–50
>50
Managers
<30
30–50
>50
Non-managers
<30
30–50
>50
Total
<30
30–50
>50
2019
2018
–
17%
83%
–
76%
24%
6%
85%
9%
4%
86%
10%
28%
64%
8%
23%
69%
8%
–
50%
50%
N/A
N/A
N/A
N/A
N/A
N/A
4%
88%
8%
26%
67%
7%
21%
71%
8%
N/A means that data was not available due to changes in employee categories. Managers
are defined as employees with personnel responsibility. This employee category also includes
team leaders. Non-managers are defined as employees without personnel responsibility.
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share ENVIRONMENTAL DATA
Carbon footprint, tonnes CO2e
Scope 1 – direct emissions
Scope 2 – indirect emissions
Total Scope 1 & 2
Scope 3 – other indirect emissions
Total Scope 1, 2 & 3
Emissions per employee
2019
205
1,293
1,498
5,986
7,484
3.77
2018
Energy consumption, GJ
263
1,206
1,469
6,416
7,885
4.42
Direct energy consumption
Indirect energy consumption
Cooling
Electricity
Heating
Total
Energy consumption per employee
2019
–
20,767
5
15,298
5,464
20,767
10.47
2018
–
19,616
–
12,098
7,518
19,616
10.99
The data covers the main emission sources in NENT Group’s operations:
i) Facilities – energy use in NENT Group’s offices and other facilities, including broadcasting
and TV production when performed directly by the company.
ii) Materials – consumption of office supplies, fruit and coffee.
iii) Travel – business travel (including air, rail and road travel) and hotel stays.
In 2019, NENT Group switched from a location-based to a market-based method of calculating
CO2e from energy use. This allows the purchase of renewable energy to be accounted for in
the total carbon footprint. The market-based method was applied retroactively, meaning that
the 2018 and 2019 figures are comparable.
At NENT Group, no fuel is burnt that falls under the direct energy use category. The calculation
methodologies used are based on the GHG Protocol and are supplemented where necessary
by additional data and assumptions. At NENT Group, the following emissions fall within the
three scopes outlined in the GHG Protocol:
Scope 1 direct emissions – Leased and owned cars, fuel.
Scope 2 indirect emissions – Cooling, electricity and heating.
Scope 3 other indirect emissions – Heating, use of materials and travel such as private and
rental cars, hotel nights, taxi and air travel.
Emission figures are calculated via quarterly data gathering processes across the company’s
facilities, as well as from external travel suppliers. The figures are based on all three GHG
Proto col scopes and the base year is 2018.
In 2019, for the first time all NENT Group’s companies reported available carbon data. This
data improvement may have led to increases for some indicators, such as electricity. For further
information on NENT Group’s green actions, please refer to page 39 of this report.
GRI 302-1
GRI 302-3
GRI 305-1
GRI 305-2
GRI 305-3
GRI 305-4
141
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share CORPORATE GIVING DATA
KSEK
Donated media time
Products & services
Cash donations
Total donations
Funds raised for charity
Total corporate giving
Hours
Volunteering hours
2019
45,301
–
39
45,340
8,080
53,420
2019
58
2018
30,958
1,525
209
32,692
8,239
40,931
2018
422
The value of donated media time is based on the estimated market value of the commercial
media time that NENT Group has donated to charity organisations. Funds raised for charity
include NENT Group’s own fundraising campaigns and funds raised together with NGOs.
Products & services refers to any products or services that have been donated to charity free
of charge, such as subscriptions. In 2018, the majority of volunteering hours related to NENT
Group’s Diabetes Gala.
142
GRI 203-1
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share COMPLIANCE DATA
Content compliance breakdown – TV & Streaming
Content compliance breakdown – Radio
Number of complaints
Advertising
Not in breach
Out of which relating to minors
Sponsorship
Not in breach
Out of which relating to minors
Programmes, promos & other
Not in breach
Out of which relating to minors
Total
Still pending at the end of 2019
Fines/penalties
2019
2018
Number of complaints
2019
2018
–
–
–
–
–
–
7
7
–
7
2
–
4
4
1
1
1
–
15
15
1
20
–
–
Advertising
Not in breach
Sponsorship
Not in breach
Programmes, promos & other
Not in breach
Total
Still pending at the end of 2019
Fines/penalties
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
All of NENT Group’s radio stations hold local licenses and are therefore locally regulated. No
broadcast complaints relating to NENT Group’s radio channels were received in 2018 or 2019.
The figures refer to the number of broadcast complaints, and are divided into various cate-
gories (advertising, sponsorship and programmes and promos). All NENT Group’s Ofcom
licensed TV channels and streaming services are included in these figures. ‘Not in breach’
means that the complaint was dismissed by Ofcom and that the content in question was
determined to be in compliance with rules and regulations. ‘Still pending’ means that the
complaint has yet to be ruled upon.
Content compliance training
Number of people trained
Internally
Externally
Total
Anti corruption
Number of cases
Confimed incidents of corruption
Whisteblower incidents
2019
74
14
88
2018
131
–
131
2019
2018
–
1
–
–
NENT Group’s central Content Compliance Team provides continuous training for employees
whose daily work involves NENT Group’s content compliance procedures, such as those work-
ing in acquisitions, programming, scheduling, sales, on-air planning and creative services.
When necessary, the Content Compliance Team also trains external production teams who
produce content for NENT Group’s services or channels. For more information on NENT
Group’s whistleblowing process see page 38.
GRI 205-3
GRI 417-2
GRI 417-3
143
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share
GRI Index
GRI 101
Foundation 2016 – General Disclosures
102-1
102-2
102-3
102-4
102-5
102-6
102-7
102-8
102-9
102-10
102-11
102-12
102-13
102-14
102-15
Organisational Profile
Name of the organization
Activities, brands, products, and services
Location of headquarters
Location of operations
Ownership and legal form
Markets served
Scale of the organization
Reference
Administration report (Page 60)
Business segment (Pages 67–68)
Administration report (Page 60)
At a glance (Inside cover page-page 1)
Data tables (Page 135)
The NENT Group Share (Page 42)
Business segments (Pages 67–68)
At a glance (Inside cover page-page 1)
Consolidated balance sheet (Page 71)
Assurance
Comment
NENT Group portfolio covers five products
and services (Viaplay, Viafree, Viasat, TV and
Radio)
Information on employees and other workers
Supply chain
Data tables (Page 135)
Value Chain (Page 130)
Significant changes to the organization and its supply chain
Significant events in 2019 by quarter (Page 61)
Precautionary Principle or approach
Committing to our conduct (Page 39)
External initiatives
Membership of associations
Strategy
Statement from senior decision-maker
Key impacts, risks, and opportunities
CEO’s Statement (Page 6)
Membership of associations (Page 131)
Reference
CEO’s Statement (Pages 4–6)
How we create impact (Pages 29–30)
Risk and risk management (Page 57)
Assurance
Comment
Ethics and Intergrity
Reference
Assurance
Comment
102-16
Values, principles, standards, and norms of behavior
Committing to our conduct (Pages 37–39)
102-17
Mechanisms for advice and concerns about ethics
Committing to our conduct (Page 38)
144
GRI 102-55
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Governance
102-18
Governance structure
102-20
Executive-level responsibility for economic, environmental,
and social topics
Reference
Assurance
Comment
Governance and responsibility (Page 49)
Governance and responsibility (Page 49)
102-22
Composition of the highest governance body and its committees
Governance and responsibility (Page 47)
102-23
102-24
102-25
102-26
102-27
Chair of the highest governance body
Board of Directors (Page 51)
Nominating and selecting the highest governance body
Governance and responsibility (Page 46)
Conflicts of interest
Governance and responsibility (Page 47)
Administration report (Page 66)
Role of highest governance body in setting purpose, values and strategy
Governance and responsibility (Page 49)
Collective knowledge of highest governance body
Governance and responsibility (Page 49)
102-30
Effectiveness of risk management processes
Risk and risk management (Page 57)
102-31
Review of economic, environmental, and social topics
Governance and responsibility (Page 49)
Risk and risk management (Page 57)
Highest governance body's role in sustainability reporting
Governance and responsibility (Page 49)
102-32
102-33
Communicating critical concerns
102-35
Remuneration policies
102-36
Process for determining remuneration
Stakeholder Engagement
102-40
List of stakeholder groups
Risk and risk management (Page 57)
Committing to our conduct (Page 38)
Governance and responsibility (Page 49)
Administration report (Page 66)
Governance and responsibility (Page 49)
Administration report (Page 66)
Reference
Assurance
Comment
Stakeholder engagement and materiality
determination (Page 129)
102-41
Collective bargaining agreements
Data tables (Page 137)
102-42
Identifying and selecting stakeholders
102-43
Approach to stakeholder engagement
102-44
Key topics and concerns raised
Stakeholder engagement and materiality
determination (Page 128)
Stakeholder engagement and materiality
determination (Page 128)
Stakeholder engagement and materiality
determination (Page 129)
145
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share 102-45
Reporting Practice
Entities included in the consolidated financial statements
102-46
Defining report content and topic Boundaries
102-47
List of material topics
Restatements of information
Changes in reporting
Reporting period
Date of most recent report
Reporting cycle
Contact point for questions regarding the report
102-48
102-49
102-50
102-51
102-52
102-53
102-54
102-55
102-56
Assurance
Comment
Reference
Financial statements (Pages 69–77)
Report scope and boundaries (Page 150)
Stakeholder engagement and materiality
determination (Pages 127–128)
Report scope and boundaries (Page 150)
Stakeholder engagement and materiality
determination (Page 127)
Report scope and boundaries (Page 150)
Report scope and boundaries (Page 150)
Report scope and boundaries (Page 150)
Report scope and boundaries (Page 150)
Report scope and boundaries (Page 150)
Report scope and boundaries (Page 150)
Claims of reporting in accordance with the GRI Standards
Report boundaries and scope (Page 150)
GRI content index
External assurance
GRI Index (Pages 144–149)
Independent assurance statement (Page 151)
GRI 200
Economic Standard Series – Material Topics
GRI 201
103-1 to 103-3 Management approach
Economic Performance 2016
201-1
Direct economic value generated and distributed
GRI 203
103-1 to 103-3 Management approach
Indirect Economic Impacts 2016
203-1
Infrastructure investments and services supported
203-2
Significant indirect economic impacts
GRI 205
103-1 to 103-3 Management approach
Anti-corruption 2016
205-2
205-3
Communication and training about anti-corruption
policies and procedures
Confirmed incidents of corruption and actions taken
146
Reference
Administration report (Pages 59–68)
Materiality determination (Pages 127–128)
Consolidated income statement (Page 70)
Consolidated balance sheet (Page 71)
Reference
Developing Nordic Storytelling and the crea-
tive industry (Page 31). Promoting an equal,
diverse and inclusive society (Pages 32–34).
Materiality determination (Pages 127–128)
Developing Nordic Storytelling and the creative
industry (Page 31). Promoting an equal, diverse and
inclusive society (Page 34). Data tables (Page 142)
Promoting an equal, diverse and inclusive
society (Pages 33–34)
Reference
Committing to our conduct (Pages 37–38)
Materiality determination (Pages 127–128)
Committing to our conduct (Page 37)
Committing to our conduct (Pages 37–38)
Data tables (Page 143)
Assurance
Comment
Partially reported. Excludes payments to
government, community investments; and
direct economic value on separate levels
since it is not considered material.
Comment
Assurance
Assurance
Comment
Partially reported. We only disclose the total % of
employees at NENT Group that were trained.
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share GRI 300
Environmental Standards Series – Material Topics
GRI 302
Energy 2016
103-1 to 103-3 Management approach
302-1
302-3
Energy consumption within the organization
Energy intensity
GRI 305
Emissions 2016
103-1 to 103-3 Management approach
305-1
Direct (Scope 1) GHG emissions
305-2
Energy indirect (Scope 2) GHG emissions
305-3
305-4
Other indirect (Scope 3) GHG emissions
GHG emissions intensity
GRI 400
Social Standards Series – Material Topics
GRI 401
Employment 2016
103-1 to 103-3 Management approach
401-1
401-3
New employee hires and employee turnover
Parental leave
GRI 402
Labour/Management Relations 2016
103-1 to 103-3 Management approach
Reference
Assurance
Comment
Committing to our conduct (Pages 37–39)
Materiality determination (Pages 127–128)
Data tables (Page 141)
Data tables (Page 141)
Reference
Committing to our conduct (Pages 37–39)
Materiality determination (Pages 127–128)
Data tables (Page 141)
Data tables (Page 141)
Data tables (Page 141)
Data tables (Page 141)
Assurance
Comment
Reference
Assurance
Comment
Nurturing our culture (Pages 35–36)
Committing to our conduct (Page 38)
Materiality determination (Pages 127–128)
Data tables (Page 136)
Data tables (Page 137)
Partially reported. Method for data collection
regarding return to work and retention will be
reviewed and reported on next year.
Reference
Assurance
Comment
Committing to our conduct (Page 38)
Materiality determination (Pages 127–128)
Data tables (Page 137)
402-1
Minimum notice periods regarding operational changes
Data tables (Page 137)
GRI 403
Health and Safety 2016
103-1 to 103-3 Management approach
403-2
Types of injury and rates of injury, occupational diseases, lost days,
and absenteeism, and number of work-related fatalities
Reference
Assurance
Comment
Nurturing our culture (Pages 35–36)
Committing to our conduct (Page 38)
Materiality determination (Pages 127–128)
Data tables (Page 138)
Due to the small number of injuries, we do not
provide a regional breakdown of the types of
injuries to protect the privacy of our employees.
147
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share
GRI 404
Training and Education 2016
103-1 to 103-3 Management approach
Reference
Assurance
Comment
Nurturing our culture (Pages 35–36)
Committing to our conduct (Page 38)
Materiality determination (Pages 127–128)
404-1
Average hours of training per year per employee
Data tables (Page 139)
404-3
Percentage of employees receiving regular performance and
career development reviews
GRI 405
Diversity and Equal Opportunity 2016
103-1 to 103-3 Management approach
Nurturing our culture (Page 36)
Data tables (Page 139)
Reference
Promoting an equal, diverse and inclusive
society (Pages 32–34). Nurturing our culture
(Pages 35–36). Committing to our conduct
(Page 38). Materiality determination (Pages
127–128)
Assurance
Comment
405-1
Diversity of governance bodies and employees
Data tables (Page 140)
GRI 406
Non-discrimination 2016
103-1 to 103-3 Management approach
406-1
Incidents of discrimination and corrective actions taken
GRI 412
Human Rights Assessment 2016
103-1 to 103-3 Management approach
Reference
Assurance
Comment
Promoting an equal, diverse and inclusive
society (Pages 32–34). Nurturing our culture
(Pages 35–36). Committing to our conduct
(Page 38). Materiality determination (Pages
127–128)
Promoting an equal, diverse and inclusive
society (Page 33)
Reference
Assurance
Comment
Committing to our conduct (Pages 37–38)
Materiality determination (Pages 127–128)
412-2
Employee training on human rights policies or procedures
Committing to our conduct (Page 37)
Partially reported. Data for total training
hours is not available.
GRI 417
Marketing and Labelling 2016
103-1 to 103-3 Management approach
417-2
Incidents of non-compliance concerning product
and service information and labeling
417-3
Incidents of non-compliance concerning marketing communications
Reference
Assurance
Comment
Committing to our conduct (Page 38)
Producing quality content (Pages 40–41)
Materiality determination (Pages 127–128)
Producing quality content (Page 40)
Data tables (Page 143)
Producing quality content (Page 40)
Data tables (Page 143)
148
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share G4
Media Sector Disclosures
Content creation
103-1 to 103-3 Management approach
M2
M3
Methodology for assesing and monitoring
adherence to content creation values
Actions taken to improve adherence to content
creation values, and results obtained
Content dissemination
103-1 to 103-3 Management approach
M4
M5
Actions taken to improve performance in relation to content dissemination
issues (accesibility and protection of vulnerableaudiences and informed
decision making) and results obtained
Number and nature of responses (feedback/complaints) related to content
dissemination, including protection of vulnerable groups
Audience interaction
103-1 to 103-3 Management approach
M6
Methods to interact with audiences and results
Reference
Assurance
Comment
Developing Nordic Storytelling and creative
industry (Page 31). Promoting an equal,
diverse and inclusive society (Pages 32–34).
Committing to our conduct (Page 38).
Producing quality content (Pages 40–41).
Materiality determi nation (Pages 127–128)
Promoting an equal, diverse and inclusive
society (Pages 32–33). Producing quality
content (Pages 40–41)
Developing Nordic Storytelling and creative
industry (Page 31). Promoting an equal,
diverse and inclusive society (Pages 32–33)
Committing to our conduct (Page 38)
Producing quality content (Pages 40–41)
Reference
Assurance
Comment
Committing to our conduct (Page 38)
Producing quality content (Pages 40–41)
Materiality determination (Pages 127–128)
Producing quality content (Page 41)
Producing quality content (Page 40)
Reference
Assurance
Comment
Committing to our conduct (Page 38)
Producing quality content (Pages 40–41)
Materiality determination (Pages 127–128)
Producing quality content (Page 41)
Partially reported. We do not disclose number
of people engaged, broken down by
engagement method due to such group
aggregated data inavailability.
Media Literacy
103-1 to 103-3 Management approach
M7
Actions taken to empower audiences through media
literacy skills development and results obtained
Reference
Assurance
Comment
Producing quality content (Pages 40–41)
Materiality determination (Pages 127–128)
Producing quality content (Page 41)
149
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Report scope and boundaries
This is NENT Group’s first Annual report with an integrated
Sustainability report since separating from previous
parent company Modern Times Group (MTG) and listing
independently on Nasdaq Stockholm in 2019. The report
was prepared in accordance with the GRI Standards
(Core Level), and it fulfills the requirements for sustainabil-
ity reporting as stipulated by the Annual Accounts Act
(ÅRL). We have also applied the GRI G4 Media Sector
Supplement for indicators where possible.
The report’s content has been defined by the topics
which were deemed material in our materiality assess-
ment conducted in 2018, and served as a basis for our first
NENT Group’s sustainability strategy. The report covers
NENT Group’s performance in a wider sense of sustaina-
bility, assessing our impacts in the society through the
sustain able development goals, and the areas where we
believe we can add wider societal value.
The report boundary has been defined by using the
completeness principle to reflect NENT Group’s significant
economic, environmental and social impacts. The report-
ing scope includes operations over which we have full
control (i.e. subsidiaries where NENT Group AB owns 51%
or more). The data covers NENT Group’s companies which
were active in 2019.
There were significant data improvements in 2019
allowing for better data monitoring & reporting, such as
the integration of all NENT Group’s companies into our
Group HR system, and almost all Nordic NENT Studios
companies into our Group Travel system, which was not
the case before for our NENT Studios segment. For specifi-
cation on methods of workforce data collection please
refer to page 135.
Strix Benelux based in the Netherlands was excluded
from the workforce data due to an ongoing reorganisa-
tion process. One small NENT Studios office in Romania
was not included in the carbon data for energy use.
Because of the reorganisation at NENT Group in 2019,
information about average minimum time of notice
period about reorganisation has been included.
We continue to work towards further integration, and
take steps to improve data accuracy. In 2019 we switched
from a location-based to a market-based method of
calculating CO2e from energy use, which allows for the
purchase of renewable energy to be accounted for in
the total carbon footprint.
Reporting period
1 January 2019–31 December 2019
Reporting framework:
GRI Standards (Level: Core) & G4 Media
Supple ment
Changes in reporting:
First year reporting, hence no changes
Date of most recent report:
First year reporting
Restatements of information:
First year reporting, hence no restatements
Contact details
For questions regarding NENT Group’s opera-
tional sustainability work, please contact the
Sustainability department (sustainability@
nentgroup.com).
Questions regarding NENT Group’s Annual
Report and Sustainability Report should be
directed to the Investor Relations department
(investors@nentgroup.com). Both departments
are located at NENT Group’s head office at
Ringvägen 52 in Stockholm, Sweden.
150
GRI 102-45
GRI 102-46 GRI 102-48 GRI 102-49
GRI 102-50
GRI 102-51
GRI 102-52
GRI 102-53
GRI 102-54
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Independent assurance statement
Introduction
We have been engaged by the Board of Directors and
the Chief Executive Officer of Nordic Entertainment
Group AB to undertake a limited assurance engagement
of Nordic Entertainment Group AB Sustainability Report
for the financial year 2019. Nordic Entertainment Group
AB has defined the scope of the Sustainability Report that
also is the Statutory Sustainability Report on pages 28–41,
49, 57 and 126–150.
Responsibilities of the Board of Directors and the
Chief Executive Officer
The Board of Directors and the Chief Executive Officer
are responsible for the preparation of the Sustainability
Report including the Statutory Sustainability Report in
accordance with applicable criteria and the Annual
Accounts Act respectively. The criteria are defined on
page 150 in the Sustainability Report and are part of
the Sustainability Reporting Standards published by GRI
(The Global Reporting Initiative), that are applicable to the
Sustainability Report, as well as the accounting and calcu-
lation principles that the Company has developed. This
responsibility also includes the internal control relevant to
the preparation of a Sustainability Report that is free from
material misstatements, whether due to fraud or error.
Auditor’s responsibility
Our responsibility is to express a conclusion on the Sustain-
ability Report based on the limited assurance procedures
we have performed and to express an opinion regarding
the Statutory Sustainability Report. Our assignment is
limited to the historical information that is presented and
does not cover future-oriented information.
We conducted our limited assurance engagement in
accordance with ISAE 3000 Assurance engagements
other than audits or reviews of historical financial infor-
mation. A limited assurance engagement consists of
making inquiries, primarily of persons responsible for the
preparation of the Sustainability Report, and applying
analytical and other limited assurance procedures.
Our examination regarding the Statutory Sustainability
Report has been conducted in accordance with FAR’s
accounting standard RevR12 The auditor’s opinion regard-
ing the Statutory Sustainability Report. A limited assurance
engagement and an examination according to RevR 12
is different and substantially less in scope than an audit
conducted in accordance with International Standards on
Auditing and generally accepted auditing standards in
Sweden.
The firm applies ISQC 1 (International Standard on
Quality Control) and accordingly maintains a compre-
hensive system of quality control including documented
policies and procedures regarding compliance with ethical
require ments, professional standards and applicable legal
and regulatory requirements. We are independent of
Nordic Entertainment Group AB in accordance with pro-
fessional ethics for accountants in Sweden and have other-
wise fulfilled our ethical responsibilities in accordance with
these requirements.
The limited assurance procedures performed and the
examination according to RevR 12 do not enable us to
obtain assurance that we would become aware of all
significant matters that might be identified in an audit.
The conclusion based on a limited assurance engagement
and an examination according to RevR 12 does not provide
the same level of assurance as a conclusion based on an
audit.
Our procedures are based on the criteria defined
by the Board of Directors and Managing Director as
de scribed above. We consider these criteria suitable for
the preparation of the Sustainability Report.
We believe that the evidence obtained is sufficient and
appropriate to provide a basis for our conclusions below.
Conclusions
Based on the limited assurance procedures performed,
nothing has come to our attention that causes us to believe
that the Sustainability Report is not prepared, in all material
respects, in accordance with the criteria defined by the
Board of Directors and Executive Management. A Statutory
Sustainability Report has been prepared.
Stockholm 2 April 2020
KPMG AB
Joakim Thilstedt
Authorised Public Accountant
Torbjörn Westman
Expert Member of FAR
GRI 102-56
151
Overview CEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability reportingThe share Definitions & Glossary
Financial key ratio definitions
Capital employed
Capital employed is the sum of current and
non-current assets less current and non-current
liabilities, provisions and liabilities at fair value.
All items are non- interest-bearing.
Cash flow from operations
Cash flow from operations comprises operat-
ing cash flow before financial items and tax
payments, taking into account other financial
cash flow.
Earnings per share
Earnings per share is expressed as net income
attributable to equity holders of the parent
divided by the average number of shares.
EBITDA
EBITDA is read Earnings Before Interest, Tax,
Depreciation and Amortisation.
Equity/assets ratio
The equity/assets ratio corresponds to share-
holders’ equity including non- controlling inter-
est, expressed as a percentage of total assets.
Interest coverage ratio
Interest coverage ratio is calculated as operat-
ing income less financial costs divided by finan-
cial costs.
Items affecting comparability (IAC)
Items affecting comparability refers to mate-
rial items and events related to changes in the
Group’s structure or lines of business, which are
relevant for understanding the Group’s devel-
opment on a like-for-like basis.
Net debt
Net debt is the sum of short- and long-term
interest-bearing liabilities less total cash and
interest-bearing assets. As from 1 January 2019
net debt also includes lease liabilities net of
sublease receivables and dividend payable.
Operating income
Operating income comprise results before inter-
est and tax. A synonym for operating income is
EBIT (Earnings Before Interest and Tax).
Operating margin %
Operating profit as a percentage of net sales.
Organic growth
Change in net sales compared to the same
period of the previous year excluding
acquisitions and divestments and adjusted
for currency effects.
Return on capital employed (ROCE) %
Return on capital employed is calculated as
operating income as a percentage of average
capital employed.
Return on equity (ROE) %
Return on equity is expressed as net income as
a percentage of average shareholders’ equity.
Working Capital
Current assets, excluding cash and equivalents
and current tax assets, reduced by interest-
free current liabilities, excluding current tax
liabilities.
Financial calendar
Q1 Results Announcement
Thursday, 23 April 2020
Silent period 2–23 April
Annual General Meeting 2020
Tuesday, 19 May 2020
Stockholm
Documentation and further
details of when and how to give
notice to attend will be published
in advance on
www.nentgroup.com
Q2 Results Announcement
Wednesday, 22 July 2020
Silent period 1–22 July
Q3 Results Announcement
Thursday, 22 October 2020
Silent period 1–22 October
152
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability informationThe share Operational key ratio definitions and glossary
AVOD, Advertising video
on-demand
A video on demand service that is free for
users and funded through advertising.
EST, Electronic sell-through
A sub-category of TVOD whereby customers
pay a one-time fee to download content for
permanent access.
Third-party customer
A customer who has access to NENT Group’s
content through a third-party company.
Branded content
Editorial content (i.e. not advertising spots) that
is funded by and produced for an advertiser.
Non-scripted content
Content such as reality entertainment shows or
documentaries that do not follow a set script.
Carriage fee
A fee paid by a TV distributor to NENT Group in
order to show NENT Group’s TV channels.
CSOL, Commercial share of listening
A company’s share of commercial radio listen-
ing in the age group 12+ years ( Norway) or
12–79 years (Sweden).
CSOV, Commercial share of viewing
A company’s share of commercial TV viewing
in the age group 15–49 years.
Direct-to-consumer
The distribution of products and services by a
company directly to the customer.
Original
Content created and owned by a media com-
pany (as opposed to content acquired from
another company) for direct distribution to its
own or partners’ customers.
Scripted content
Content such as drama series or films that follow
a set script.
Sublicensing
The licensing of content by one company from
another company currently holding this license.
SVOD, Subscription video on-demand
A video on demand service where a customer
pays a regular subscription fee to access the
service.
TV Everywhere
A common feature of pay-TV services that
enables customers to access pay-TV content
over the internet.
TVOD, Transaction video
on-demand
A video on demand service where customers
can purchase content on a pay-per-view basis.
VOD, Video on-demand
A general term for services that enable
customers to stream or download video
content whenever they want and on a range
of devices.
Addresses
Nordic Entertainment Group AB
Telephone
+46 (0)8 562 025 00
www.nentgroup.com
Postal address
P.O. Box 2094
SE-103 13 Stockholm
Sweden
Visitors’ address
Ringvägen 52
SE-118 67 Stockholm
Sweden
Investors
investors@nentgroup.com
Sustainability
sustainability@nentgroup.com
Media
press@nentgroup.com
Whistleblowing
sustainability@nentgroup.com
OverviewCEO’s statementPerfectly positionedInvestment propositionSustainabilityGovernance reportAdministration report & Financial statementsSustainability informationThe share we are the beat of entertainment