Astral shows continued growth in the second quarter of Fiscal 2012

• 10% increase in net earnings¹
• 15% increase in diluted EPS¹

MONTREAL, April 11, 2012 /PRNewswire/ - Astral Media Inc. (TSX: ACM.A ACM.B) today reported its financial results for the second quarter ended February 29, 2012, which saw continued growth in revenues, EBITDA², net earnings, EPS, and cash flow from operations².

For the second quarter, consolidated revenues totalled $233.5 million, a slight increase over the $232.7 million recorded last year for the same period. For the second quarter, EBITDA² rose by 3% to $66.0 million from $64.3 million for the same period last year. Consolidated net earnings for the second quarter grew by 10% to $38.2 million¹ from $34.7 million for the same period last year, while diluted earnings per share grew 15% to $0.69¹ from $0.60 per share last year. Cash flow from operations² rose by 3% to $50.2 million for the second quarter compared to $48.7 million for the corresponding period last year.

For the first half of the year, consolidated revenues totalled $504.6 million, an increase of 1% over the $499.8 million recorded last year for the same period. For the first six months of Fiscal 2012, EBITDA² rose by 2% to $156.4 million from $153.4 million for the same period last year. Consolidated net earnings for the first six months of Fiscal 2012 grew by 7% over last year to $94.0 million¹ from $87.7 million, while diluted earnings per share grew 10% to $1.68¹ from $1.53 last year. Cash flow from operations² rose by 3% to $119.2 million for the first six months of the year compared to $115.4 million for the corresponding period last year.

"I am very pleased by the Company's growth in the second quarter and by our properties' continued ability to compete aggressively in a market environment that remains challenging," said Ian Greenberg, President and Chief Executive Officer. "Once again, consumers' and advertisers' appetite for our media brands, the soundness of our development strategy and the strength of our treasury management practices have enabled us to record Astral's 62^nd consecutive quarter of profitable growth."

FINANCIAL AND OPERATIONAL HIGHLIGHTS

Television

• 4% advertising revenue growth for the quarter (2% growth for the six-month period) and 1% growth in subscriber-related revenues for the quarter (2% growth for the six-month period);
• Sequential increase in the number of pay-TV subscribers for The Movie Network and Super Écran to 1.869 million from 1.868 million for the three-month period, up 1,000 subscribers (increase of 10,000 subscribers for the six-month period to 1.869 million from 1.859 million);
• EBITDA² growth of 3% for the quarter (2% growth for the six-month period²);
• Announcement, on December 22, 2011, of the launch of the Disney XD and Disney Junior (French) services on the Cogeco Cable distribution network.

Radio

• Revenue decline of 3% for the quarter (3% decline for the six-month period);
• EBITDA² decline of 3% for the quarter (5% decline for the six-month period);
• On January 4, 2012, the Company completed the acquisition of all outstanding shares of Shore Media Group Inc., a radio broadcaster in Vancouver, British Columbia, for a cash consideration of $13.4 million;
• On February 1, 2012, launch of an all-new digital music service across all of the Company's Top-40 format radio stations.

Out-of-Home

• Revenue growth of 8% for the quarter (11% growth for the six-month period);
• EBITDA² growth of 19% for the quarter (16% growth for the six-month period);
• On February 28, 2012, announcement of the introduction of the Near Field Communication technology to Astral Out-of-Home's street furniture structures in Toronto and Montréal.

Corporate

• Company announcement, on March 16, 2012, subsequent to the end of the second quarter, that it has entered into a definitive agreement with BCE Inc. for the sale of its business through the acquisition of all of its issued and outstanding shares³ (the "Bell-Astral Transaction");
• Following the announcement of the Bell-Astral Transaction, the Company's dividend payment scheduled for August 2012 and activity under the Normal Course Issuer Bid ("NCIB") have been suspended;
• The repurchase of 191,900 Class A Shares for a consideration of $6.4 million in the second quarter under the Company's NCIB;
• The appointment of Robert Fortier as the Company's Vice-President, Finance, and Chief Financial Officer.

The unaudited interim condensed consolidated financial statements with related notes and Management's Discussion and Analysis are available on the Company's website: www.astral.com.

There will be a conference call with analysts and media at 10:30 a.m. on Wednesday, April 11, 2012. To access the conference call dial 1-800-731-5319. The conference call will also be broadcast live and archived for a three-month period on the Astral website at www.astral.com.

Founded in 1961, Astral is one of Canada's largest media companies. It operates several of the country's most popular pay and specialty television, radio, out-of-home advertising and digital media properties. Astral plays a central role in community life across the country by offering diverse, rich and vibrant programming that meets the tastes and needs of consumers and advertisers. To learn more about Astral, visit www.astral.com.

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.

1. Excluding the impact, for the second quarter of Fiscal 2012, of acquisition and other costs, totalling $4.3 million or $3.2 million net of income taxes ($0.06 per share, diluted) mainly related to the Shore FM acquisition. See details in the "Additional IFRS and Non-IFRS Measures" in Appendix 1.
2. See "Additional IFRS and Non-IFRS Measures" in Appendix 1.
3. See the "Acquisition of Astral" section in the Management's Discussion and Analysis.

ASTRAL MEDIA INC. Interim Consolidated Statements of Earnings for the periods ended February 29, 2012 and February 28, 2011 (in thousands of Canadian dollars except for per-share data) (unaudited)
			3 months						6 months
				2012			2011		2012				2011
Revenues			$	233,503		$	232,678		$	504,603		$	499,771
Operating expenses				167,459			168,403			348,158			346,390
Acquisition and other costs				4,311			-			4,311			-
Depreciation of property, plant and equipment				7,360			7,041			14,866			13,881
Amortization of other intangible and non-current assets				1,976			2,301			3,938			4,514
Financial expense, net				3,973			5,475			7,926			11,170
Earnings before income taxes				48,424			49,458			125,404			123,816
Income tax provision				13,419			14,768			34,643			36,071
Net earnings			$	35,005		$	34,690		$	90,761		$	87,745
Earnings per share
	- Basic		$	0.63		$	0.61		$	1.64		$	1.55
	- Diluted		$	0.63		$	0.60		$	1.62		$	1.53

ASTRAL MEDIA INC.  Interim Consolidated Statements of Comprehensive Income for the periods ended February 29, 2012 and February 28, 2011 (in thousands of Canadian dollars) (unaudited)
		3 months						6 months
			2012			2011			2012			2011
Net earnings		$	35,005		$	34,690		$	90,761		$	87,745
Other comprehensive income
Actuarial gain (loss) on employee future benefit plans, net of income tax expense (recovery) of ($1.3 million) and $0.7 million respectively for the three months, and ($3.7 million) and $1.5 million respectively for the six months			(3,591)			1,969			(10,363)			4,231
Change in fair value of derivatives designated as cash flow hedges, net of income tax expense of $0.5 million and $0.5 million respectively for the three months, and $0.6 million and $1.4 million respectively for the six months			1,523			1,396			1,633			3,704
Comprehensive income		$	32,937		$	38,055		$	82,031		$	95,680

ASTRAL MEDIA INC.  Interim Consolidated Statements of Cash Flows for the periods ended February 29, 2012 and February 28, 2011 (in thousands of Canadian dollars) (unaudited)
				3 months						6 months
					2012			2011			2012			2011
OPERATING ACTIVITIES
	Net earnings			$	35,005		$	34,690		$	90,761		$	87,745
	Non-cash items:
		Stock-based compensation costs			1,872			1,723			4,024			4,216
		Depreciation and amortization			9,336			9,342			18,804			18,395
		Imputed interest, net			426			449			685			758
		Amortization of deferred financing costs			272			172			477			343
		Deferred tax expense			3,288			2,327			4,410			3,977
	Cash flow from operations				50,199			48,703			119,161			115,434
	Net change in non-cash operating items				6,260			10,481			(38,847)			(20,056)
Cash provided by operating activities					56,459			59,184			80,314			95,378
INVESTING ACTIVITIES
	Additions to property, plant and equipment				(6,808)			(7,693)			(12,382)			(17,687)
	Additions to other intangible and non-current assets				(1,344)			(5,061)			(2,296)			(7,849)
	Business acquisition, net of cash acquired				(11,520)			-			(11,520)			-
Cash used for investing activities					(19,672)			(12,754)			(26,198)			(25,536)
FINANCING ACTIVITIES
	Repayment of long-term debt				(20,000)			-			(30,000)			(10,000)
	Deferred financing costs				(6)			-			(2,017)			-
	Stock options exercised				14,166			7,787			17,276			12,603
	Shares repurchased				(6,369)			(31,440)			(14,126)			(31,440)
	Dividends				(27,919)			(21,371)			(27,923)			(21,375)
Cash used for financing activities					(40,128)			(45,024)			(56,790)			(50,212)
Net change in cash					(3,341)			1,406			(2,674)			19,630
Cash - beginning of period					23,320			29,769			22,653			11,545
Cash - end of period				$	19,979		$	31,175		$	19,979		$	31,175

 

ASTRAL MEDIA INC.   Interim Consolidated Balance Sheets as at (in thousands of Canadian dollars) (unaudited)
		February 29, 2012			August 31, 2011			September 1, 2010
ASSETS
Current
	Cash	$	19,979		$	22,653		$	11,545
	Accounts receivable		163,086			170,063			169,240
	Program and film rights		116,735			105,385			106,723
	Prepaid expenses and other current assets		33,817			29,096			29,451
			333,617			327,197			316,959
Program and film rights			53,074			51,058			41,640
Property, plant and equipment			192,893			195,508			180,616
Broadcast licences			1,650,410			1,639,785			1,661,949
Goodwill			121,067			116,016			116,016
Other intangible and non-current assets			66,484			70,543			64,162
Non-current financial assets			16,101			19,852			22,848
Deferred tax assets			62,234			60,747			64,683
		$	2,495,880		$	2,480,706		$	2,468,873
LIABILITIES
Current
	Accounts payable and accrued liabilities	$	118,924		$	142,627		$	143,780
	Provisions		2,867			4,621			3,380
	Income taxes payable		10,643			13,560			16,654
	Program and film rights payable		77,915			77,033			64,908
	Other current financial liabilities		241			1,945			-
			210,590			239,786			228,722
Long-term debt			492,593			524,133			588,447
Deferred tax liabilities			153,314			152,455			144,424
Program and film rights payable			10,639			8,839			12,668
Provisions			5,876			5,453			5,244
Other non-current liabilities			70,435			57,124			63,820
Other non-current financial liabilities			8,741			10,116			20,311
			952,188			997,906			1,063,636
SHAREHOLDERS' EQUITY
Capital stock			777,074			762,572			768,762
Contributed surplus			17,559			17,278			18,903
Retained earnings			748,836			704,360			624,609
Accumulated other comprehensive income (loss)			223			(1,410)			(7,037)
			749,059			702,950			617,572
			1,543,692			1,482,800			1,405,237
		$	2,495,880		$	2,480,706		$	2,468,873

ASTRAL MEDIA INC. Business Segments for the periods ended February 29, 2012 and February 28, 2011 (in thousands of Canadian dollars) (unaudited)
	3 months						6 months
		2012			2011			2012			2011
REVENUES
Television	$	140,561		$	138,879		$	294,113		$	288,563
Radio		74,197			76,396			162,488			168,027
Out-of-Home		18,745			17,403			48,002			43,181
	$	233,503		$	232,678		$	504,603		$	499,771
EBITDA(1)
Television	$	49,665		$	48,426		$	108,273		$	105,897
Radio		18,396			18,970			45,987			48,483
Out-of-Home		4,310			3,634			16,145			13,866
Corporate		(6,327)			(6,755)			(13,960)			(14,865)
	$	66,044		$	64,275		$	156,445		$	153,381

(1) See Appendix 1.

ASTRAL MEDIA INC.

Appendix 1

Additional IFRS and Non-IFRS Measures

for the periods ended February 29, 2012 and February 28, 2011

(unaudited)

---

In addition to discussing earnings measures in accordance with International Financial Reporting Standards ("IFRS"), this Press Release provides the following additional IFRS and non-IFRS measures which are also factors used by the Company's management and Board of Directors in monitoring and evaluating the performance of the Company and its business segments:

ADDITIONAL IFRS MEASURE

Cash flow from operations is defined as cash provided by 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.

NON-IFRS MEASURE

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 acquisition and other costs are also 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.

The following table reconciles IFRS measures disclosed in the consolidated statements of earnings for the periods ended February 29, 2012 and February 28, 2011 to EBITDA:

	3 months				6 months
(in thousands of $)	2012		2011		2012		2011
Earnings before income taxes	48,424		49,458		125,404		123,816
Depreciation and amortization	9,336		9,342		18,804		18,395
Financial expense, net	3,973		5,475		7,926		11,170
Acquisition and other costs	4,311		-		4,311		-
EBITDA	66,044		64,275		156,445		153,381

Net earnings and diluted earnings per share before acquisition and other costs. These measures provide an indication of the Company's ability to generate earnings from its ongoing operations, by excluding some items such as acquisition and other costs as they are not considered to be in the ordinary course of business.

The following tables reconcile IFRS measures disclosed in the consolidated statements of earnings for the periods ended February 29, 2012 and February 28, 2011 to net earnings and diluted earnings per share before acquisition and other costs:

	3 months				6 months
(in thousands of $)	2012		2011		2012		2011
Net earnings	35,005		34,690		90,761		87,745
Acquisition and other costs, net of income taxes	3,198		-		3,198		-
Net earnings before acquisition and other costs	38,203		34,690		93,959		87,745
	3 months				6 months
(in dollars)	2012		2011		2012		2011
Diluted earnings per share	0.63		0.60		1.62		1.53
Acquisition and other costs, net of income taxes	0.06		-		0.06		-
Diluted earnings per share before acquisition and other costs	0.69		0.60		1.68		1.53

The above additional IFRS and non-IFRS measures do not have a standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies. 

 

 

 

SOURCE ASTRAL MEDIA INC.