March 24, 2020 / 4:43 PM / 17 days ago

UPDATE 1-Finland's Sanoma scraps outlook with ad sales set to drop

* Sanoma says outbreak to hit ads sales

* Says ads sales dropped 17% after 2008 crisis

* Sees little impact on education materials unit

* Repeats long-term dividend, business targets (Adds details, quotes, smaller rivals)

March 24 (Reuters) - Finnish publisher Sanoma said on Tuesday it would scrap its 2020 outlook as the coronavirus outbreak will hit advertising sales at its media business but it was sticking to its long-term financial targets.

“The corona virus outbreak will have a material impact on the net sales and profitability of Media Finland’s B2B advertising business as well as events business but it is too early to make reliable and specific estimates of the size of the impact,” Sanoma said.

Sanoma, which publishes Finland’s leading daily Helsingin Sanomat among several other newspapers, said its advertising sales fell about 17% after the financial crisis in 2008.

The Finnish firm said it did not expect any major impact on its other main business unit which makes educational materials.

Sanoma said it would issue a 2020 outlook later in the year.

“In the current continuously and rapidly evolving situation it is too early to make reliable and specific estimates for an adjusted outlook,” Sanoma said, adding its sales and profitability in 2020 had developed according to expectations.

On Feb. 7, Sanoma said it expected 2020 sales to be stable with an adjusted operating profit margin of about 15%.

Sanoma said it was sticking to its policy of increasing its dividend yearly, and paying out 40% to 60% of annual free cashflow and reiterated its targets for its main Learning and Media Finland businesses.

Earlier on Tuesday, smaller local rival Punamusta Media started talks with its staff of 650 about layoffs due to a sharp decline in the media and printing market. On Monday, Ilkka scrapped the 2020 outlook it issued last month. (Reporting by Tarmo Virki in Tallinn; Editing by Alison Williams and David Clarke)

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