Hamburg, March 27, 2006
Gruner + Jahr, Europe´s biggest magazine publisher and the strongest-selling German publisher, lastingly enhanced its leading market position in fiscal 2005. For the first time in four years, G+J increased its revenues and achieved significant growth in profits, managing to pull off a turnaround in a difficult market environment.

In 2005, Gruner + Jahr grew its revenue by roughly 8 percent to €2.62 billion (2004: €2.44 billion). There was an especially pleasing return to growth in the core business. Adjusted for portfolio effects, G+J´s revenue growth amounted to 1.2 percent. G+J still has the highest international revenues of any major German publisher (57% of total revenue).

Profitability was lastingly improved and grew above the rate of revenue growth. Operating EBIT increased by 17 percent to €250.3 million (2004: €213.3 million). The return on sales (ROS) improved to 9.5 percent (2004: 8.7 percent). This already includes publishing investments totaling €41 million.

As a result of changes to the portfolio and the launch offensive, the number of employees increased greatly to 13,981 employees worldwide (2004: 11,567 employees). Adjusted for portfolio effects, Gruner + Jahr grew its headcount by two percent.

At today´s Annual Press Conference in Hamburg, G+J Chairman & CEO Dr. Bernd Kundrun declared: "Gruner + Jahr´s gratifying business performance in 2005 further underscored its market-leading position and turned the tide toward further growth. We now have a broad and diverse portfolio of magazines in Germany and beyond that keeps us independent of regional market developments while also giving us a foundation for steady growth."

Gruner + Jahr will remain true to its strategy in 2006 as well, said Dr. Kundrun: "We will continue to develop our core business and focus on exploiting the potential of our strong, established media brands. We will also continue our innovation campaign with new titles and stay our international expansionist course. This year, too, we will tap new countries and markets wherever investment opportunities open up that make strategic sense."

Chief Financial Officer Achim Twardy confirmed that the funds to do so are available: "Gruner + Jahr made good money in 2005. Despite a number of investments in the new expansionist course, the leeway for investments has grown again. Thanks to a good operating performance and systematic portfolio management, the net cash from operating activities increased by 13% to €259 million in 2005. This year, we will again invest about two percent of our revenue in new titles and projects. Additional resources for acquisitions are on hand."

In 2005, G+J launched sixteen new titles worldwide. This brings the total of new magazines launched since the start of the innovation campaign in 2003 to forty-seven (47). G+J also reinforced its position as the most innovative journalistic company in Germany. The publisher emerged as the big winner of this year´s "Lead Awards," one of the most prestigious awards for print and online media in Germany, having scored a total of 25 medals and awards. NEON was honored as "Lead Magazine of the Year 2005," while PARK AVENUE was named "Newcomer Magazine of the Year 2005". VIEW won the OMG Award sponsored by the Media Agencies Organization, part of the GWA (Gesamtverband Werbeagenturen).

Bernd Kundrun declared: "We have succeeded in establishing a one-of-a-kind culture of innovation at Gruner + Jahr. Far from being limited to special development teams, it is upheld by all employees. This makes me especially confident. Creativity and a readiness to innovate form the crucial basis for a publishing company´s future."

The portfolio saw further strategic enhancements in 2005. G+J entered new countries and segments by acquiring the majority of shares (54.9%) in Motor Presse Stuttgart (MPS), with its more than 140 magazines. G+J has consolidated MPS´ revenues and results since July 1, 2005.

G+J also expanded to two other growth markets in 2005: On July 1, 2005, the publishing house bought up 50% of the shares in the Greek magazine publisher Daphne Communications. Also with effect from July 1, 2005, G+J entered into a joint venture in Croatia with Styria Media. In a next step, the publisher plans to buy up Hubert Burda Media´s magazine operations in Croatia, Serbia and Montenegro, and Slovenia and contribute all of these titles to a joint venture with the Finnish-Dutch publisher Sanoma Magazines International. The project is pending clearance by the antitrust authorities.

The formation of the PRINOVIS joint venture with arvato and Axel Springer secured the future of the gravure business and laid the foundation for further growth in this field. 50 percent of the revenue and result generated by PRINOVIS have been consolidated at G+J since July 1, 2005.

Meanwhile, G+J sold its U.S. magazine business in May 2005. Since there was no prospect of attaining a market-leading position in the U.S. magazine market in the foreseeable future, the U.S. publishing operations were sold to the Meredith Corporation and the U.S. investor Joseph Mansueto at mid-year. The Brown Printing operations were not affected by this transaction.

Overall, the portfolio adjustments were largely made without tying up additional financial resources.

The Magazine Division Germany was a key contributor to G+J´s positive overall performance in 2005. Thanks to enhanced efficiency and processes, it significantly improved its performance, despite the persistently difficult situation in the advertising markets.

Numerous launches served to strengthen the G+J brand portfolio in 2005, especially in growing segments. A new title in the luxury segment was launched – PARK AVENUE – and HEALTHY LIVING made its debut in the health segment. By launching VIEW, G+J further enhanced the strength of the STERN brand family. Diversification businesses such as BRIGITTE´s audiobook edition "Strong Voices" (roughly 1.5 million CDs sold) and the BRIGITTE Edition library (approx. 1.5 million books sold) contributed to an improved market position and profitability at BRIGITTE.

STERN, BRIGITTE, and GEO continue to be reliable mainstays of revenues and profits in G+J´s core business. An item that deserves special mention is the positive performance of ESSEN&TRINKEN FÜR JEDEN TAG, which increased its total circulation by more than 25 percent year on year, to over 400,000 copies, and the gratifying revenue development at GALA. NEON, a magazine concept unique to the German market, is winning over more and more readers, and with 160,000 sold copies made breakeven barely 18 months after its launch.

G+J´s German websites (stern.de, brigitte.de etc.) showed a positive development in online advertising sales. In 2005, their cumulated ad sales put them among the Top 10 G+J ad media for the first time.

The Magazine Division France made a significant growth contribution with Prisma Presse. France´s biweekly TV titles TÉLÉ 2 SEMAINES and TV GRANDES CHAÎNES continued their growth trend in the distribution and ad sales market and played a key part in the improved result generated by the French magazine business. FEMME ACTUELLE and TÉLÉ LOISIRS maintained their status as the biggest revenue drivers. Thanks to systematic brand management and a successful overhaul, FEMME ACTUELLE saw a considerable increase in revenues and, along with TÉLÉ LOISIRS, remains Prisma Presse´s flagship.

The people magazine GALA again posted a very gratifying rise in circulation and ad sales, and a record result for 2005. VOICI stood its ground in a keenly-fought competitive environment. CAPITAL bucked the trend among French business magazines, growing its circulation and increasing its result to levels well above the previous year. PRIMA MAISON made its debut, a companion for all matters relating to the home.

The International Magazine Division also significantly improved its results from core business, especially in Austria and Poland. The titles launched in 2004 have become established in their respective markets and are showing excellent development.

The innovation campaign continued with the simultaneous debut of GEO in seven countries (Hungary, Czech Republic, Slovakia, Romania, Croatia, Turkey and Italy). The first-ever international edition of a G+J magazine was developed under the auspices of the central editorial office in Hamburg. Each issue is then translated enriched with local content by a team of editors in the respective countries. MPS´ international publishing offices played a crucial part in realizing the project by handling the production, marketing and distribution with its publishing structures in Eastern Europe.

In Poland, G+J further reinforced its market leadership in women´s magazines by launching FENIKS, a psychologically inspired women´s magazine, and YOUNG MISS, a trend magazine for young women. It also introduced FOCUS HISTORIA, a monothematic series on specific eras in history. In the Netherlands, an issue of GLAMOUR was very successfully launched under license, marking G+J´s entry into the upscale women´s magazines segment.

In Spain, GALA continued to add circulation, transcending a difficult market environment. GALA BIOGRAFIA in Russia and QUEST in the Netherlands have already well exceeded their target circulation.

In the Newspaper unit, the FINANCIAL TIMES DEUTSCHLAND pushed its sold circulation past 100,000 in the year of its fifth anniversary, and continues to grow. It outperformed the market in terms of ad sales growth, and introduced a new supplement, ENABLE, to extraordinarily positive response from advertisers and readers.

The SÄCHSISCHE ZEITUNG and MORGENPOST SACHSEN newspapers remained very profitable despite a sluggish market performance. Dresdner Druck- und Verlagshaus further strengthened its market position in ad sales and postal delivery by acquiring the WVD media group.

The printing division strengthened its market position despite price and cost pressure from the market. Investments in the future were made at PRINOVIS, as well as in the U.S. printing operations at Brown Printing. PRINOVIS has laid a cornerstone for future growth with its new plant in Liverpool, which will take up production in mid-2006. In the U.S., Brown Printing realized an extensive reinvestment program at its Waseca plant. Brown Printing´s two biggest customers, Time Inc. and Meredith Corporation, extended their contracts by eight and five years respectively, securing a positive future for G+J´s U.S. printing business.

For further information:

Dr. Andreas Knaut
Head of Corporate Communications + Public Affairs
Phone: +49-40-3703-3113
E-Mail: knaut.andreas@guj.de