* RCS plans capex of 300 mln euros to help growth strategy
* Core margins seen more than doubling to 10 percent in 2015
* Credit Suisse appointed advisor on capital needs
(Adds details, advisor appointment, analysts comment)
By Danilo Masoni
MILAN, Dec 19 RCS MediaGroup, the
publisher of Italy's most influential newspaper, Corriere della
Sera, acknowledged on Wednesday it will need a large injection
of capital to accelerate its digital transition and reverse
losses over the next three years.
Sources close to the matter said last month RCS was mulling
a cash call of at least 400 million euros, about half its net
debt, but last week the company delayed a decision on the likely
capital increase until February or March.
But unveiling the outline business plan for the next three
years under new Chief Executive Pietro Scott Jovane, the company
said on Wednesday it would need "new significant capital
resources" to help it achieve its targets, as cost cuts and
disposals will not be enough.
It also said Credit Suisse has been appointed to
advise Jovane on the "preparation of the financial structure
that will support the implementation of the plan, including
It did not give a figure for the needed capital boost but
said it will require investments of 300 million euros ($396
million) and will focus on digital innovation and support for
its key brands, while cutting costs and selling non-core assets
to improve efficiency.
The indebted group has been hit hard by the economic
downturn that has rattled Europe and is set to close 2012 in
loss for a second straight year, with margins squeezed by a
rapid fall in advertising and circulation sales.
RCS said it expects revenue to steady at 1.6 billion euros
in 2015, with digital revenues accounting for around 25 percent
of total turnover, while its core profit margin is expected to
rise to 10 percent of sales from 4 percent in 2012.
Earnings before interest, tax, depreciation and amortization
(EBITDA) are expected to be around 160 million euros in 2015,
excluding one-off charges, it said.
Analysts said the amount of planned investments was higher
than expected, while the profit target was broadly in line. They
had anticipated a lack of detail on disposals and capital needs.
The shares were up 5 percent immediately after the plan was
unveiled but turned lower to end the session down 1.1 percent at
(Additional reporting by Antonella Ciancio; Editing by Greg