Astral Media shows continued growth in the second quarter of fiscal 2010
- 24% increase in net earnings and 25% increase in basic EPS(1)
- 4% increase in revenue and 6% increase in EBITDA(1),(2)
</pre>
<p/>
<p><span class="xn-location">MONTREAL</span>, <span class="xn-chron">April 8</span> /CNW Telbec/ - Astral Media Inc. (TSX: ACM.A/ACM.B) today reported its financial results for the second quarter ended <span class="xn-chron">February 28, 2010</span>, which saw continued growth in net earnings, EPS, revenues, EBITDA(2) and cash flow from operations(5).</p>
<p>Consolidated net earnings for the second quarter grew 24% to <span class="xn-money">$33.6 million</span> from <span class="xn-money">$27.1 million</span>(1) for the same period last year, while basic earnings per share grew 25% to <span class="xn-money">$0.60</span> from <span class="xn-money">$0.48</span> per share(1) last year. Consolidated revenues for the second quarter totalled <span class="xn-money">$218.3 million</span>, a 4% increase over the <span class="xn-money">$209.3 million</span> reported last year for the same period. For the second quarter, EBITDA(2) rose to <span class="xn-money">$62.6 million</span> from <span class="xn-money">$59.2 million</span>(1) for the same period last year, a 6% increase.</p>
<p>Consolidated net earnings for the first six months of Fiscal 2010 increased by 35% over last year, rising to <span class="xn-money">$89.9 million</span>(3),(4) (<span class="xn-money">$1.59</span> per share) from <span class="xn-money">$66.7 million</span>(1) (<span class="xn-money">$1.19</span> per share) last year. Consolidated revenues totalled <span class="xn-money">$469.0 million</span> for the first half of the year, an increase of 3% over the <span class="xn-money">$453.8 million</span> recorded last year for the same period. EBITDA(2) for the first six months grew by 18% to <span class="xn-money">$159.4 million</span>(4) from <span class="xn-money">$134.6 million</span>(1) for the same period last year.</p>
<p>"I am pleased by the strength of our second quarter results and delighted that all our business units continue to perform well in a challenging environment, allowing us to record a 54th consecutive quarter of profitable growth for Astral," said <span class="xn-person">Ian Greenberg</span>, President and Chief Executive Officer. "Throughout the economic downturn, we have continued to invest strategically in sales, programming and branding initiatives across all our platforms, making important headway in further strengthening our position in key Canadian markets."</p>
<p/>
<p>FINANCIAL AND OPERATIONAL HIGHLIGHTS</p>
<p/>
<p>Television</p>
<p/>
<pre>
- Revenue growth of 6% for the quarter (6% growth for the six-month
period);
- 11% advertising revenue growth for the quarter derived from air time
(4% growth for the six-month period) and 7% growth in subscriber-
related revenues for the quarter (7% growth for the six-month
period);
- EBITDA(2) growth of 14% for the quarter(1) (22% growth for the six-
month period(1),(4)).
</pre>
<p/>
<p>Radio</p>
<p/>
<pre>
- Revenue decline of 2% for the quarter (1% decline for the six-month
period);
- EBITDA(2) decline of 14% for the quarter(1) (10% growth for the six-
month period(1),(4));
- In December, rebranding of the EZ Rock 97.3 FM station in Toronto to
boom 97.3 with a new format and a revised personality lineup;
- In January, "Les Grandes Gueules" made a return on air across the
10-station NRJ network with their highly popular radio show.
</pre>
<p/>
<p>Outdoor Advertising</p>
<p/>
<pre>
- Revenue growth of 23% for the quarter (6% growth for the six-month
period);
- EBITDA(2) growth of 107% for the quarter (17% growth for the six-
month period).
</pre>
<p/>
<p>The unaudited interim consolidated financial statements with related notes and the Management's Discussion and Analysis are available on the Company's website: <a href="http://www.astralmedia.com">www.astralmedia.com</a>.</p>
<p/>
<p>There will be a conference call with analysts and media at <span class="xn-chron">10:30 a.m.</span> on <span class="xn-chron">Thursday, April 8, 2010</span>. To access the conference call dial 1-877-974-0445. The conference call will also be broadcast live and archived for a three-month period on the Astral Media website at <a href="http://www.astralmedia.com">www.astralmedia.com</a>.</p>
<p/>
<p>Astral Media is a leading Canadian media company, active in specialty and pay television, radio, outdoor advertising and interactive media. Astral Media's solid and dynamic presence in the country's major markets rests on its commitment to offer a unique combination of high-quality, targeted media for all its audiences.</p>
<p/>
<p>This press release contains certain forward-looking statements concerning the future performance of the Company. These forward-looking statements are based on current expectations. We caution that all forward-looking information is inherently uncertain and actual results may differ materially from the assumptions, estimates or expectations reflected or contained in the forward-looking information, and that actual future performance will be affected by a number of factors, including technological change, economic conditions, regulatory change, competitive factors and changes in accounting rules or standards, many of which are beyond the Company's control. Except as required under applicable securities regulations, we disclaim any intention or obligation to update or revise any forward-looking statements.</p>
<p/>
<pre>
1. After the restatement of Fiscal 2009 figures following the adoption
of Section 3064 of the CICA Handbook. See details in the Management's
Discussion and Analysis.
2. EBITDA is defined as earnings before interest, taxes, depreciation
and amortization. See Appendix 1.
3. Excluding the impact of an $8.4 million ($0.15 per share) non-cash
future income tax recovery resulting from future income tax rate
changes enacted by the Ontario Government. See Appendix 1.
4. Including the $11.6 million in Part II licence fees accrual reversal
($8.0 million net of income taxes or $0.14 per share) in the first
quarter of Fiscal 2010 ($3.2 million in Television and $8.4 million
in Radio). See details in the Management's Discussion and Analysis.
5. See Appendix 1.
ASTRAL MEDIA INC.
Interim Consolidated Statements of Earnings
for the three months ended February 28, 2010 and 2009
(in thousands of Canadian dollars except for per-share data)
(unaudited)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
3 months 6 months
------------------------ -------------------------
2010 2009 2010 2009
----------------------------------------------------
(Restated)(1) (Restated)(1)
Revenues $ 218,281 $ 209,278 $ 468,966 $ 453,761
Operating expenses 155,694 150,092 309,566 319,120
----------------------------------------------------
EBITDA(2) 62,587 59,186 159,400 134,641
Depreciation 6,287 5,324 12,427 10,618
Amortization of
intangible assets 1,147 1,202 2,591 2,304
Interest expense,
net 6,614 9,546 13,803 20,064
Restructuring
charges - 2,691 - 2,691
----------------------------------------------------
Earnings before
income taxes 48,539 40,423 130,579 98,964
----------------------------------------------------
Income tax provision
before undernoted 14,896 13,320 40,692 32,256
Future income tax
recovery resulting
from income tax
rate changes - - (8,397) -
----------------------------------------------------
14,896 13,320 32,295 32,256
----------------------------------------------------
Net earnings $ 33,643 $ 27,103 $ 98,284 $ 66,708
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Earnings per share
- Basic $ 0.60 $ 0.48 $ 1.74 $ 1.19
----------------------------------------------------
- Diluted $ 0.59 $ 0.48 $ 1.72 $ 1.18
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----------------
(1) Following the adoption of Canadian Institute of Chartered
Accountants' ("CICA") Handbook Section 3064, the Company has restated
results of operations for the three- and six-month periods ended
February 28, 2009 (see Note 1.b) of the unaudited interim
consolidated financial statements).
(2) See Appendix 1.
ASTRAL MEDIA INC.
Interim Consolidated Statements of Cash Flows
for the periods ended February 28, 2010 and 2009
(in thousands of Canadian dollars)
(unaudited)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
3 months 6 months
------------------------ -------------------------
2010 2009 2010 2009
----------------------------------------------------
Cash and cash (Restated)(1) (Restated)(1)
equivalents
provided by
(used for):
OPERATING ACTIVITIES
Net earnings $ 33,643 $ 27,103 $ 98,284 $ 66,708
Non-cash charges
(credits):
Part II licence
fees accrual
reversal - - (11,552) -
Stock-based
compensation
costs 1,328 1,555 3,471 3,266
Depreciation and
amortization 7,434 6,526 15,018 12,922
Imputed interest
on other
non-current
liabilities 524 660 1,083 1,319
Amortization of
deferred
financing costs 171 171 342 343
Future income tax
expense before
undernoted 2,590 2,059 7,048 4,238
Future income tax
recovery
resulting from
income tax rate
changes - - (8,397) -
----------------------------------------------------
Cash flow from
operations(2) 45,690 38,074 105,297 88,796
Net change in non-
cash operating
items 10,133 20,760 (22,397) 4,530
----------------------------------------------------
Cash flow from
operating activities 55,823 58,834 82,900 93,326
----------------------------------------------------
INVESTING ACTIVITIES
Short-term
investments -
cashed - - - 9,962
Additions to
property, plant
and equipment (11,039) (9,821) (20,083) (20,027)
Additions to other
intangible and
non-current assets (4,042) (591) (5,573) (1,295)
Business
acquisition, net
of cash acquired - - - (2,787)
----------------------------------------------------
Cash flow used
for investing
activities (15,081) (10,412) (25,656) (14,147)
----------------------------------------------------
FINANCING ACTIVITIES
Repayment of long-
term debt (30,000) (10,000) (40,000) (20,000)
Stock options
exercised 7,274 85 8,114 165
Shares repurchased (858) - (858) -
Dividends (14,141) (14,030) (14,145) (14,034)
----------------------------------------------------
Cash flow used for
financing activities (37,725) (23,945) (46,889) (33,869)
----------------------------------------------------
Net change in cash
and cash equivalents 3,017 24,477 10,355 45,310
Cash and cash
equivalents
(bank overdraft) -
beginning of period 30,438 17,189 23,100 (3,644)
----------------------------------------------------
Cash and cash
equivalents - end
of period $ 33,455 $ 41,666 $ 33,455 $ 41,666
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-------------------------------------------------------------------------
(1) Following the adoption of CICA Handbook Section 3064, the Company has
restated results of operations for the three- and six-month periods
ended February 28, 2009 (see Note 1.b) of the unaudited interim
consolidated financial statements).
(2) See Appendix 1.
ASTRAL MEDIA INC.
Interim Consolidated Balance Sheets as at
(in thousands of Canadian dollars)
(unaudited)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
February 28, August 31,
2010 2009
----------------------------
(Restated)(1)
ASSETS
Current
Cash and cash equivalents $ 33,455 $ 23,100
Accounts receivable 146,437 143,803
Program and film rights 102,547 92,545
Prepaid expenses and other current assets 29,725 27,904
----------------------------
312,164 287,352
Program and film rights 62,692 61,219
Property, plant and equipment 157,934 151,637
Broadcast licences 1,408,037 1,408,037
Goodwill 356,945 356,945
Other intangible and non-current assets 53,399 50,894
Future income tax assets 66,473 79,522
----------------------------
$ 2,417,644 $ 2,395,606
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-------------------------------------------------------------------------
LIABILITIES
Current
Accounts payable and accrued liabilities $ 105,283 $ 138,771
Income taxes payable 17,847 12,191
Program and film rights payable 65,539 58,220
Future income tax liabilities 3,658 4,481
----------------------------
192,327 213,663
Long-term debt 653,103 692,761
Future income tax liabilities 231,585 243,353
Other non-current liabilities 67,008 65,267
Derivative financial instruments 16,265 22,377
----------------------------
1,160,288 1,237,421
----------------------------
SHAREHOLDERS' EQUITY
Capital stock 765,594 753,028
----------------------------
Contributed surplus 15,703 17,068
----------------------------
Retained earnings 487,863 404,198
Accumulated other comprehensive loss (11,804) (16,109)
----------------------------
476,059 388,089
----------------------------
1,257,356 1,158,185
----------------------------
$ 2,417,644 $ 2,395,606
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(1) Following the adoption of CICA Handbook Section 3064, the Company has
restated its consolidated balance sheet as at August 31, 2009 (see
Note 1.b) of the unaudited interim consolidated financial
statements).
ASTRAL MEDIA INC.
Business Segments
for the periods ended February 28, 2010 and 2009
(in thousands)
(unaudited)
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-------------------------------------------------------------------------
3 months 6 months
------------------------ -------------------------
2010 2009 2010 2009
------------------------ -------------------------
(Restated)(1) (Restated)(1)
REVENUES
Television $ 129,448 $ 121,778 $ 270,675 $ 255,217
Radio 73,906 75,334 163,071 165,192
Outdoor Advertising 14,927 12,166 35,220 33,352
----------------------------------------------------
$ 218,281 $ 209,278 $ 468,966 $ 453,761
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EBITDA(2)
Television $ 46,198 $ 40,649 $ 102,806 $ 84,557
Radio 19,975 23,235 59,511 53,891
Outdoor Advertising 3,091 1,495 10,870 9,311
Corporate Costs (6,677) (6,193) (13,787) (13,118)
----------------------------------------------------
$ 62,587 $ 59,186 $ 159,400 $ 134,641
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----------------
(1) Following the adoption of CICA Handbook Section 3064, the Company has
restated results of operations for the three- andsix-month periods
ended February 28, 2009 (see Note 1.b) of the unaudited interim
consolidated financial statements).
(2) See Appendix 1.
ASTRAL MEDIA INC.
Appendix 1
Supplementary Measures
for the periods ended February 28, 2010 and 2009
(unaudited)
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</pre>
<p/>
<p>In addition to discussing earnings measures in accordance with Canadian generally accepted accounting principles ("GAAP"), this Press Release provides the following supplementary measures which are also factors used by management in monitoring and evaluating the performance of the Company and its business segments:</p>
<p>EBITDA (earnings before interest, taxes, depreciation and amortization) is provided to assist investors in determining the ability of the Company to generate cash flow from operating activities and to cover financial charges. Other items such as restructuring charges are excluded from earnings in the determination of EBITDA as they are not considered to be in the ordinary course of business. EBITDA is also an indicator widely used for business valuation purposes. EBITDA margin is defined as the ratio obtained by dividing EBITDA by revenues.</p>
<p>The following table reconciles GAAP measures disclosed in the unaudited interim consolidated statements of earnings for the periods ended <span class="xn-chron">February 28, 2010</span> and 2009 to EBITDA:</p>
<p/>
<pre>
3 months 6 months
----------------------------------------------------
(in thousands of $) 2010 2009 2010 2009
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(Restated)(1) (Restated)(1)
Earnings before
income taxes 48,539 40,423 130,579 98,964
Depreciation and
amortization 7,434 6,526 15,018 12,922
Interest expense, net 6,614 9,546 13,803 20,064
Restructuring charges - 2,691 - 2,691
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EBITDA 62,587 59,186 159,400 134,641
-------------------------------------------------------------------------
-------------------------------------------------------------------------
</pre>
<p/>
<p>Net earnings and basic earnings per share before the impact of future income tax rate changes. These measures provide an indication of the Company's ability to generate earnings and cash flows from its ongoing operations, by excluding the non-cash future income tax recovery or expense resulting from income tax rate changes over which the Company has no control.</p>
<p>The following tables reconcile GAAP measures disclosed in the unaudited interim consolidated statements of earnings for the periods ended <span class="xn-chron">February 28, 2010</span> and 2009 to net earnings and basic earnings per share, before the impact of future income tax rate changes.</p>
<p/>
<pre>
3 months 6 months
----------------------------------------------------
(in thousands of $) 2010 2009 2010 2009
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-------------------------------------------------------------------------
(Restated)(1) (Restated)(1)
Net earnings 33,643 27,103 98,284 66,708
Future income tax
recovery resulting
from income tax rate
changes - - (8,397) -
-------------------------------------------------------------------------
Net earnings before
the impact of future
income tax rate
changes 33,643 27,103 89,887 66,708
-------------------------------------------------------------------------
-------------------------------------------------------------------------
3 months 6 months
----------------------------------------------------
(in dollars) 2010 2009 2010 2009
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(Restated)(1) (Restated)(1)
Basic earnings per
share 0.60 0.48 1.74 1.19
Impact of future
income tax rate
changes - - (0.15) -
-------------------------------------------------------------------------
Basic earnings per
share, before the
impact of future
income tax rate
changes 0.60 0.48 1.59 1.19
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-------------------------------------------------------------------------
(1) Following the adoption of CICA Handbook Section 3064, the Company has
restated results of operations for the three- and six-month periods
ended February 28, 2009 (see Note 1.b) of the unaudited interim
consolidated financial statements).
</pre>
<p/>
<p>Cash flow from operations is defined as cash flow from operating activities before the net change in non-cash operating items. This measure provides an indication of the Company's ability to generate cash flows without considering certain timing and other factors causing variations in non-cash operating items.</p>
<p>The following table reconciles GAAP measures disclosed in the unaudited interim consolidated statements of cash flows for the periods ended <span class="xn-chron">February 28, 2010</span> and 2009 to cash flow from operations:</p>
<p/>
<pre>
3 months 6 months
----------------------------------------------------
(in thousands of $) 2010 2009 2010 2009
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(Restated)(1) (Restated)(1)
Cash flow from
operating activities 55,823 58,834 82,900 93,326
Net change in non-
cash operating items (10,133) (20,760) 22,397 (4,530)
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Cash flow from
operations 45,690 38,074 105,297 88,796
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</pre>
<p/>
<p>The above supplementary measures do not have a standardized meaning prescribed by GAAP and may not be comparable to similar measures presented by other companies.</p>
<p/>
<pre>
(1) Following the adoption of CICA Handbook Section 3064, the Company has
restated results of operations for the three- and six-month periods
ended February 28, 2009 (see Note 1.b) of the unaudited interim
consolidated financial statements).
For further information: Media: Pierre Boisseau, Assistant Vice-President, Communications, Astral Media Inc., (514) 939-5000; Financial Analysts: Claude Gagnon, Senior Vice-President and Chief Financial Officer, Astral Media Inc., (514) 939-5000
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