Seminar material from 6.9.2012 Feel the Pulse - Global insight into booming education market. Jyri Ahti, CSO Sanoma Learning. Future Learning Finland.

1. Sanoma Learning –
at the forefront of
transformation
Future Learning Finland
Jyri Ahti
CSO Sanoma Learning
Copyright © Sanoma Learning | Jyri Ahti 5 September 2012 1

2. Leading player in Europe
#1 or #2 in markets where present
• Total market for K-12 Market: Sweden Market: Finland
learning materials in our
Market Position: #2 Market Position: #1
Sales: approx. EUR 20 m Sales: approx. EUR 50 m
operating countries FTEs: approx. 60 FTEs: approx. 210
Size of market: approx. EUR 80 m Size of market: approx. EUR 90 m
approx. EUR 750 million
• Sanoma in the forefront
of digital transformation Market: Netherlands
Market Position: #2
Market: Poland
Market Position: #1
• Total learning sales of
Sales: approx. EUR 80 m Sales: approx. EUR 60 m
FTEs: approx. 240 FTEs: approx. 620
Sanoma learning ca 300 Size of market: approx. EUR 300 m Size of market:
approx. EUR 140 m
m€
• Total ca 1.700 FTEs Market: Global
Market Position: one of the
leading player in e-learning
Sales: approx. EUR 10 m
FTEs: approx. 290
Market: Belgium Market: Hungary
Market Position: #1 Market Position: #1
Sales: approx. EUR 30 m Sales: approx. EUR 20 m
FTEs: approx.110 FTEs: approx. 225
Size of market: Size of market: approx. EUR 50 m
approx. EUR 100 m
Copyright © Sanoma Learning | Jyri Ahti 5 September 2012 2

3. Transformation of learning industry still in
infancy – window of opportunity is open
Global textbook revenue by product type
30,000 USD million Sanoma learning
25,000 Pro forma net sales by type of sales
20,000
15,000
10,000 Services
5,000 4%
0,000
2009 2010 2011 2012 2013 2014
Print textbook content Digital textbook content Print
Whole course solutions 56 %
Global education textbook marketplace Hybrid
by format 24 %
2012
Pure
digital
2020
16 %
0% 20 % 40 % 60 % 80 % 100 %
Print textbook content Digital textbook content
Whole course solutions
Source: Outsell Analysis
Copyright © Sanoma Learning | Jyri Ahti 5 September 2012 3

4. Widening the revenue pool offers major
growth opportunities
Total educational budget for the
countries where we are present
This part of the educational budget will hardly
Learning materials grow because
1% or approx. EUR 0.75 billion • Commoditization of content
Addressable
• Demographic development
Variable expenses
(e.g. platforms, development, training, school … but there is potential organic growth by
management)
• being in the forefront of digital transformation
24% or approx. EUR 18 billion and well positioned to create value through new
learning solutions and services
Total spending on education, 2009
Non-addressable
EUR million Total Fixed % of Learning % of Variable % of
total materials total expenses total
Country
Fixed
(salaries) Belgium 13,000 11,200 86% 100 0.8% 1,700 13%
75% or approx. EUR 56 billion Hungary 4,700 3,700 78% 50 1.1% 1,000 21%
Netherlands 20,000 16,400 82% 300 1.5% 3,300 17%
Poland 19,000 12,800 67% 135 0.7% 6,200 32%
Finland 6,100 3,900 64% 85 1.4% 2,100 35%
Sweden 11,800 8,000 68% 80 0.7% 3,700 31%
Total 74,500 55,800 75% 750 1% 17,900 24%
Source: Eurostat and OECD.
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5. The change will come ...
Copyright © Sanoma Learning | Jyri Ahti 5 September 2012 5

6. Finnish edge: keep the customer need in
focus
Pupils Parents
• Reach their learning goals • Can be sure that their
and pass their exams children are not left behind
• Receive teaching that in their studies
matches their skills and • Can be sure that the
abilities individual learning needs
• Are engaged during the of their children are met
course and motivated to
continue their studies
Teachers Headmasters
• Achieve teaching results in • See their teachers reach
an efficient way their teaching targets
• Can focus their time on 1- • Can attract more pupils to
on-1 teaching their schools
• Are less stressed and • Manage the school in an
burdened by other tasks efficient way
than teaching
Copyright © Sanoma Learning | Jyri Ahti 5 September 2012 6

7. Expanded value proposition
More embedded in our customers’ processes
Teachers need support Test & Assess
in the teaching process
Theory
Prepare
Practice
Coach
Parents need tutoring Headmasters need tools
for their kids Evaluate for school management
Plan school
outcomes year
Learning Manage
Outcomes operations
Follow
Manage data
and reports
Evaluate
& choose
Manage human
resources
Identify
need
Manage
financials
Copyright © Sanoma Learning | Jyri Ahti 5 September 2012 7

8. Building blocks of a teaching solution
From… … towards
For Teacher’s Teacher in control dashboard Multi-platform
teachers manual Management, teacher planning, class admin, offering where
reports, analytics, communication with customer
pupils/parents chooses which
one to use,
including
Teacher training • Print
• Online
For pupils Textbooks & Personalised Homework Testing • Mobile
workbooks learning module module tablets
module • Interactive
White Board
Enabler: Learning platforms
Subscription: x €/pupil, depending on number of services
Copyright © Sanoma Learning | Jyri Ahti 5 September 2012 8

9. Enabling
better results!