- 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 62nd
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.
- 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.
- See "Additional IFRS and Non-IFRS Measures" in Appendix 1.
- 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 |
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.