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Business performance in the first semester 2018
Significant earnings growth in first-half 2018

Revenue CHF 238 million (+0.7%) - 8.5% increase in operating profit at EBIT level to CHF 16.2 million - Net result comes to CHF 5.0 million (+8.6%) - Strong revenue growth in the domestic Swiss market - Continued positive development in Germany - Turnaround confirmed in Marketing Services - The Swiss Federal Competition Commission COMCO has approved Tamedia's plan to take over the Goldbach Group.

Küsnacht, 28/08/2018. Goldbach is continuing its positive development following a record year in 2017. Goldbach increased revenue in the first semester 2018 by 0.7% over the previous year to CHF 238 million, in what was a difficult advertising environment for classical media. Operating profit posted a disproportionate increase at EBIT level of 8.5% to CHF 16.2 million due to a slightly improved gross profit margin and lower operating costs. The first semester 2018 net result amounts to CHF 5.0 million compared to CHF 4.6 million in the previous year.

Ad Sales Switzerland
The business segment Ad Sales Switzerland encompasses business activities in ad marketing in Switzerland and generated total revenue of CHF 213 million, which represents an increase of +1.0% over the prior year. EBITDA stands at CHF 19.3 million, an increase of 5.4% over the prior year.
2018 is a major year for sport with the Winter Olympics and Football World Cup. These large events have a big influence on the use and distribution of advertising expenditure throughout the year. In spite of these sporting events, which were mainly restricted to the public TV stations, Goldbach Media (Switzerland) AG maintained revenue in its core business of TV marketing at the prior-year level in the first semester of 2018. Moreover, Goldbach Media successfully expanded its offering in the digital-out-of-home area (external digital advertising). In the first half of 2018, Goldbach Media acquired the marketing mandates in the shopping centres of Tivoli Spreitenbach, Arena St. Gallen and Grüzepark Winterthur.

swiss radioworld AG, which operates in the national radio business, increased its revenue in the first semester 2018 by 9% compared to the prior year. The company therefore reacted to a slower 2017 and convinced a number of new and returning clients of the benefits offered by radio advertising. In particular, major clients from the automobile industry and retail switched or increased parts of their advertising budget to radio during the first semester.

Pressure from global players, such as Google or Facebook, on online ad marketing is still increasing. Goldbach succeeded in keeping revenue from its online business in Switzerland at the prior-year level in this challenging environment. By expanding its strong position in the marketing of online video advertising over the past few years, Goldbach increased its video advertising sales by +8% in the first semester 2018. This offsets the ongoing decline in revenue from display advertising.

Ad Sales Germany
Ad Sales Germany generated revenue of CHF 7.0 million in the first semester of 2018, which corresponds to a 32% increase over the previous year. The positive development in German business mainly results from the sustained expansion of advertising inventory. In the first semester, six extra TV niche broadcasters were added to the marketing portfolio, as a result Goldbach Germany now markets over 25 TV stations. Pleasing progress was also evident in digital-out-of-home, Smart TV and Mobile. In recent years, Goldbach has established itself in the German advertising market and it has a broad base by centring its business areas on moving images. The foundations are in place for further profitable growth. Ad Sales Germany achieved EBITDA of CHF -0.1 million in the first semester of 2018 (prior-year EBITDA: CHF -0.2 million).

Ad Sales Austria
Goldbach achieved a solid result in the first semester 2018 through its marketing activities in Austria. Revenue amounted to CHF 6 million, which was slightly below the previous year (-3%) while EBITDA increased slightly over the prior year to CHF 0.2 million due to reduced operating costs (first half-year 2017: CHF 0.1 million). As expected, market share in Austria was down in the first semester 2018 due to the major sporting events (Winter Olympics, Football World Cup), which was also reflected in TV revenue posted by Goldbach. Digital-out-of-home performed very well in Austria, while the online area suffered relative to the previous year through the implementation and high expense of the GDPR plus growing competitive pressure from global players.

Marketing Services
Goldbach confirmed last year's completion of its turnaround in agency business in the first semester of 2018. The digital agency for performance marketing, now known as "dreifive", is gaining new clients such as JOOP, Strellson and Repower and posted revenue of CHF 13.4 million and EBITDA of CHF 0.2 million in the first semester 2018. With a specially developed TV attribution platform for the performance business, dreifive was able to integrate TV as an additional performance channel into its offer and by doing so, gained new clients. dreifive is well placed to continue growing in the future with its approximately 60 specialists in searching, online advertising, social media, creation and technology plus a portfolio of prominent clients in the DACH region (Germany, Switzerland and Austria).

Extraordinary result, cash flow and balance sheet
The extraordinary result for the first semester 2018 incurred additional costs of CHF -0.2 million through the acquisition by Tamedia. Earnings from the liquidation of an inactive Romanian subsidiary to the value of CHF 0.1 million were also factored into the extraordinary result in the first half of 2018. Allowing for the special effects mentioned above, adjusted net profit rose by +11% from CHF 4.6 million to CHF 5.1 million in the first half-year.

Operating cash flow is subject to major seasonal fluctuations and is invariably much lower in the first half of the year than the second. Operating cash flow in the first semester of 2018 came to CHF 3.5 million and was slightly down from the previous year due to prior payments to media partners (previous year CHF 8.0 million). Equity amounts to CHF 52.9 million, which corresponds to an equity ratio of 33.8%.

Outlook
The growing dominance of the tech giants, for example Google and Facebook, is bringing marked changes to the advertising market. Traditional advertising channels are coming under pressure, media categories are converging, business is becoming more technological. Over the past few years, Goldbach has successfully established itself as an electronic media marketing specialist in advertising. As a result, Goldbach initiated a merger with Tamedia as a strategic partner to ensure its long-term position in an intense competitive environment. Goldbach is delighted at the positive decision taken by COMCO on 16 August 2018. This means that the last major obstacle has been overcome and the merger could go ahead. Goldbach will still continue to exist as an independent company with its headquarters in Küsnacht. Together with Tamedia, Goldbach will further consolidate its position in the advertising market and continue its growth strategy in the coming years.

Note to analysts, investors and media representatives
Goldbach Group AG will offer an orientation on the 2018 interim result by telephone conference today at 9:30 a.m. Registrations at short notice are possible until 8:30 a.m. Further information is available from: iris.blaettler@goldbachgroup.com. The presentation and the 2018 interim report of Goldbach Group AG are available via the following link: http://www.goldbachgroup.com/en-us/investor-relations/financial-reports

Contact:

Investor Relations
Goldbach Group AG
Lukas Leuenberger, CFO und Leitung Investor Relations
Seestrasse 39
8700 Küsnacht-Zürich
Phone +41 (44) 914 91 00
Fax +41 (44) 914 93 60
www.goldbachgroup.com

Corporate Communications
Jürg Bachmann
Leitung Kommunikation & Marketing/Public Affairs
Phone +41 79 600 32 62
juerg.bachmann@goldbachgroup.com
www.goldbachgroup.com