CINAR Provides Shareholders with Unaudited Consolidated Financial Information.Business Editors MONTREAL--(BUSINESS WIRE)--June 27, 2001 CINAR Corporation today released unaudited consolidated financial information to shareholders. The unaudited financial information includes results for the fiscal quarter ended February February: see month. 28, 2001 and February 29, 2000. The Company has been unable to issue audited financial statements for the years ended November November: see month. 30, 2000, and November 30, 1999, and audited restatements for the years ended November 30, 1998, and 1997. In order to be audited, the financial statements of the Company must be the subject of representations from management as to certain matters, including whether any illegal acts or related party transactions exist and, if so, have been adequately reflected. New management of the Company has determined that it cannot currently provide the required assurances with respect to financial periods prior to its appointment. However, new management may possibly be in a position to do so after completion of the 2001 financial year. The auditors AUDITORS, practice. Persons lawfully appointed to examine and digest accounts referred to them, take down the evidence in writing, which may be lawfully offered in relation to such accounts, and prepare materials on which a decree or judgment may be made; and to report the whole, together of the Company have resigned, as previously disclosed. Readers are cautioned that the financial information, including the restated information provided by the Company including that summarized below, may not fairly and accurately present the financial position of the Company or the results of its operations and cash flows for the three-month period ended February 28, 2001 and February 29, 2000 in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with Generally Accepted Accounting Principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ). The Company believes that the financial information provided herein has been prepared on the basis of the best information presently available to the Company. However, neither the Company nor any of its directors, officers, employees, agents or advisors makes any representations regarding the accuracy or completeness of such financial information. HIGHLIGHTS OF THE FINANCIAL INFORMATION Consolidated revenues for the three-month period ended February 28, 2001, were $24.7 million, a decrease of 10% over the $27.5 million of revenues earned by the Company for the three-month period ended February 29, 2000. Entertainment revenues decreased from $14.6 million in 2000, to $10 million in 2001, largely due to a drop in library sales. Education revenues increased from $12.9 million to $14.7 million respectively, a 14.7% increase reflecting the continued growth of the Education Division. Gross margin increased from $6.9 million to $10.2 million for the first quarter of 2001. This increase is largely due to write-offs of distribution costs distribution costs distribute npl → Vertriebskosten pl in the first quarter of the year 2000. Gross margin in our Education Division continues to be strong at 55% of Education revenue. Selling, general and administrative expenses increased from $9.5 million to $14.5 million in the first quarter of 2001, largely due to foreign taxes paid in prior periods which the Company will not likely be able to recuperate re·cu·per·ate v. To return to health or strength; recover. and the effect of the acquisition of Twin Sisters acquired in February of 2000. Unusual items in the amount of $1.1 million are made up of professional fees in the amount of $2.3 million less $1.2 million of funds recovered from Globe-X which had been provided for in prior periods. For the quarter ended February 28, 2001, the Company realized a loss before interest, taxes, depreciation and amortization of $5.4 million compared to a loss of $48.3 million for the corresponding quarter of 2000. The Company's share of earnings in TeleTOON Teletoon, a portmanteau of "television" and "cartoon", is a name used for three cable and satellite animation channels: Teletoon Channels from Canada
The Company used $7.9 million of cash in operations for the quarter ended February 28, 2001 compared to $29.4 million for the corresponding quarter of the year 2000. The Company repaid $21.5 million of its term debt during the first quarter and the debt repayment and loss from operations were financed by a reduction in marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has . The unaudited financial information, which is the subject of this news release, is available on the Company's web site. CINAR Corporation announces that production is well under way on new episodes of three of its most popular series, CAILLOU(R), ARTHUR(R), and MONA THE VAMPIRE Mona the Vampire is an animated children's television based on the series Mona le Vampire, directed by Louise Piche and Jean Caillon, originally based on the short stories by Sonia Halleyman and Hiawyn Oram. . More adventures on the 4-year-old CAILLOU! TeleTOON, Canada's Animation Station, has ordered 16 new half-hour episodes of the acclaimed ac·claim v. ac·claimed, ac·claim·ing, ac·claims v.tr. 1. To praise enthusiastically and often publicly; applaud. See Synonyms at praise. 2. preschool series, which consistently rates among its top-rated children's shows. The new episodes will begin airing in early 2002. CAILLOU is also enjoying phenomenal success in the U.S. where it is one of the most watched shows among children ages 2 to 5. The series is produced by CINAR, in association with PBS PBS in full Public Broadcasting Service Private, nonprofit U.S. corporation of public television stations. PBS provides its member stations, which are supported by public funds and private contributions rather than by commercials, with educational, cultural, . It's it's 1. Contraction of it is. 2. Contraction of it has. See Usage Note at its. it's it is or it has it's be ~have an encore for ARTHUR, the aardvark. CINAR and WGBH This article has multiple issues: * It may contain original research or unverifiable claims. * It needs additional references or sources for verification. Boston Boston, town, England Boston, town (1991 pop. 26,495), E central England, on the Witham River. Boston's fame as a port dates from the 13th cent., when it was a Hanseatic port trading wool and wine. Having recovered from a decline in the 18th and 19th cent. are producing 10 new episodes of the four-time Emmy Award Emmy award Annual presentation for outstanding achievement in U.S. television. Its name is taken from the nickname “immy” for the image orthicon, a television camera tube. winning ARTHUR, bringing the total number of episodes to 95. The new episodes will launch ARTHUR's 6th season on PBS KIDS PBS Kids (often styled all-caps as "PBS KIDS") is the umbrella brand for children's programming aired by the Public Broadcasting Service in the United States. As with all PBS programming, PBS Kids programming is non-commercial. and one of the episodes will even feature Olympic O·lym·pic adj. Of or relating to the Olympic Games. Olympic Adjective of the Olympic Games Adj. 1. Olympic - of or relating to the Olympic Games; "Olympic winners" 2. Medal-winning skater Michelle Kwan Michelle Wing Kwan (關穎珊) (born 7 July 1980) is an American figure skater and media celebrity who has won nine U.S. championships, five world championships, and two Olympic medals. . ARTHUR is Arthur I, 1187–1203?, duke of Brittany (1196–1203?), son of Geoffrey, fourth son of Henry II of England and Constance, heiress of Brittany. Arthur, a posthumous child, was proclaimed duke in 1196, and an invasion by his uncle King Richard I of England was still a favorite among 2-11 year-olds in the U.S. and ranks among the top ten shows on the CBC (1) (Cell Broadcast Center) See cell broadcast. (2) (Cipher Block Chaining) In cryptography, a mode of operation that combines the ciphertext of one block with the plaintext of the next block. in Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of , where it also airs on the SRC (SouRCe) Contrast with DST, which is an abbreviation of "destination." and TVOntario TVOntario, officially the Ontario Educational Communications Authority, is an educational public television broadcaster in the Canadian province of Ontario. It is owned directly by the provincial government of Ontario. . The series, produced for PBS by CINAR and WGBH Boston, is based on the award-winning Adj. 1. award-winning - having received awards; "this award-winning bridge spans a distance of five miles" book series by Marc Brown. Mona Mona, island, Great Britain Mona, Roman name for the island of Anglesey, Wales. It was also sometimes used to designate the Isle of Man. Mona, island, Puerto Rico Mona, island, Puerto Rico: see under Mona Passage. gets into all kinds of hair-raising hair-rais·ing adj. Causing excitement, terror, or thrills. hair-raising Adjective very frightening or exciting Adj. 1. trouble in the 13 new half-hour episodes of the popular animated program MONA THE VAMPIRE. The series, which has been sold to major broadcasters in 93 countries, including Nickelodeon UK
in full British Broadcasting Corp. Publicly financed broadcasting system in Britain. A private company at its founding in 1922, it was replaced by a public corporation under royal charter in 1927. in the UK, and ZDF ZDF Zweites Deutsches Fernsehen ZDF Z-Firm Document Folder ZDF Zone Definition File in Germany Germany (jûr`mənē), Ger. Deutschland, officially Federal Republic of Germany, republic (2005 est. pop. 82,431,000), 137,699 sq mi (356,733 sq km). , will now comprise a total of 52 episodes. In Canada, MONA THE VAMPIRE is one of the leading shows on YTV YTV Pääkaupunkiseudun Yhteistyövaltuuskunta (Finnish: Helsinki Metropolitan Area Council) YTV Yorkshire Television YTV Youth Television , the #1 kids' English-language network in the country. The series is co-produced with Alphanim of France, in association with Canada's YTV, and France's France 3 and Canal J. CINAR will issue its semi-monthly status report by way of news releases, as it has since April 20, 2000. CINAR Corporation is an integrated entertainment and education company involved in the development, production, post-production and worldwide distribution of non-violent, quality programming and educational products for children and families. CINAR's web site is www.cinar.com. This release may include information that could constitute forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provision of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 (U.S.). Forward-looking statements are identified by words such as "believe", "anticipate", "expect", "intend", "plan", "will", "may" and other similar expressions. Actual results or conditions may differ from those anticipated by these and other forward-looking statements. Such forward-looking statements are subject to a number of known or unknown risks and uncertainties.
CINAR CORPORATION
Consolidated Balance Sheet Information
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(Unaudited) February 28 February 29
(In thousands of CDN dollars) 2001 2000
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ASSETS
Cash 9,249 27,123
Marketable securities 97,585 174,758
Accounts receivable 65,010 67,448
Related party receivable 29,072 29,243
Income taxes recoverable 21,087 -
Tax credits refundable 22,478 33,313
Inventories 17,683 15,358
Film costs 74,616 69,044
Fixed assets 8,137 8,686
Acquired film libraries 20,133 25,066
Goodwill 106,105 103,786
Deferred income - 4,105
Other assets 5,469 5,886
Other asset allowance (91,368) (94,440)
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$385,256 $469,376
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LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Bank indebtedness 249 26,698
Accounts payable and accrued liabilities 32,861 50,387
Income taxes payable 0 2,665
Deferred revenue 12,952 15,253
Deferred income taxes 747 0
Term debt 18,433 46,387
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Total liabilities 65,242 141,390
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Shareholders' equity
Capital Stock 501,182 501,182
Issued and outstanding
5,233,402 Variable Multiple Voting
(Class A) and 35,750,568 Limited Voting
(Class B) shares (2000-5,233,402
Variable Multiple Voting (Class A) and
35,750,568 Limited Voting (Class B) shares)
Cumulative translation adjustment 2,752 (172)
Deficit (183,920) (173,024)
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Total shareholders' equity 320,014 327,986
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$385,256 $469,376
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CINAR CORPORATION
Consolidated Loss and Deficit Information
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(Unaudited) 3 months ended February 28 and 29
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(In thousands of CDN dollars,
except earnings per share) 2001 2000
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Revenues
Entertainment 9,959 14,627
Educational Products 14,741 12,856
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Total Revenues 24,700 27,483
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Cost of sales
Entertainment 7,966 14,787
Educational Products 6,521 5,776
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Total Cost of Sales 14,487 20,563
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Gross Margin 10,213 6,920
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Selling, general and administrative 14,532 9,477
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Unusual Items 1,113 45,708
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Loss before interest, taxes, depreciation
and amortization (EBITDA) (5,432) (48,265)
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Depreciation and Amortization 1,988 1,869
Interest 731 2,147
Interest Income (296) (2,619)
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(7,854) (49,662)
Share of earnings of equity investment 809 431
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Loss before income taxes (7,045) (49,231)
Provision for (recovery of) income taxes (686) 2,029
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Net loss ($6,359) ($51,260)
Deficit - beginning of period (177,561) (121,764)
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Deficit - end of period ($183,920) ($173,024)
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Loss per Variable Multiple Voting Shares ($0.16) ($1.32)
(Class A) and Limited Voting (Class B)
shares outstanding
Weighted average number of Variable
Multiple Voting (Class A) and Limited 40,984 38,751
Voting (Class B) shares outstanding
(in thousands)
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CINAR CORPORATION
Consolidated Information as to Cash Flows
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(Unaudited) 3 months
(In thousands of CDN dollars) ended February 28 and 29,
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2001 2000
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OPERATING ACTIVITIES
Net loss (6,359) (51,260)
Items not affecting cash:
Depreciation and amortization 1,988 1,869
Deferred income taxes 5,065 (25)
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694 (49,416)
Net change in non-cash working capital
balances related to operations (8,583) 19,987
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Cash used in operating activities (7,889) (29,429)
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FINANCING ACTIVITIES
Repayment of term debt (21,503) (3,746)
Issue of capital stock - 308
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Cash used in financing activities (21,503) (3,438)
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INVESTING ACTIVITIES
Business acquisitions - (13,064)
Decrease in marketable securities 31,921 32,152
Acquisition of film libraries - (144)
Additions to fixed assets (290) (694)
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Cash provided by investing activities 31,631 18,250
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TRANSLATION ADJUSTMENT (393) 488
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Increase (decrease) in cash position 1,846 (14,129)
Cash position - beginning of period 7,154 14,554
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Cash position - end of period 9,000 425
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Cash position is comprised of:
Cash 9,249 27,123
Bank indebtedness (249) (26,698)
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9,000 425
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