Canwest Reports 41 Percent Profit Increase In First Nine Months - Record-setting Trend Continues (PART 1 of 2).

WINNIPEG, MANITOBA--(BUSINESS WIRE)--July 11, 1997--(TSE CGS.S. CGS.A., NYSE CWG.) CanWest Global Communications Corp., Canada's leading multinational television broadcaster, today reported record-breaking financial results for the nine months ended May 31, 1997: Combined revenue from broadcasting operations in Canada, Australia and New Zealand increased 29.7 percent, to $632.0 million; Combined broadcast operating profit was up $57.4 million, or 32.0 percent over the first nine months of fiscal 1996 to $237.0 million; Earnings from continuing operations in the first nine months of fiscal 1997 increased $34.8 million or 42.2 percent over the comparable period last year; Net earnings increased $33.9 million or 40.6 percent to $117.3 million; Earnings per share from continuing operations were $0.79 per share for the first nine months, an increase of 31.7 percent over the first three quarters of fiscal 1996; Combined cash flow from continuing operations rose $41.3 million or 38.7 percent to $148.2 million; Cash flow per share from continuing operations was $1.00 per share for the first nine months, up 29.9 percent.

"The results announced today are in line with our expectations and they clearly support our predictions that 1997 will shatter all previous marks established by the Company," said I.H. Asper, O.C., Q.C., Chairman and CEO. "We are particularly pleased that earnings per share continue to be strong - a 32 percent increase over the first nine months last year - despite the fact that this year we have more shares outstanding as a result of last year's treasury issue."

"All stations in Canada continued their strong revenue growth in the quarter just ended, and all signs suggest a continuation of this trend over the summer months," said Gerry Noble, CanWest's Vice-President, Operations. "The same can be said for Australia where revenue was strong in April and May with a projection for the demand to continue into the balance of their winter and early spring."

On July 2, 1997, the Company acquired an additional 554,700 Class B Non-Voting Shares of WIC Western International Communications Ltd., bringing its total holdings to approximately 19.4 percent of WIC's outstanding Class B Non-Voting Shares.

On June 30, the Company reached a conditional agreement to acquire More FM, New Zealand's top rated commercial radio network. More FM owns and operates two FM stations in Auckland, three FM stations in Wellington, one FM station in Christchurch, and one FM station in Dunedin. Its Dunedin station and one of its two Auckland stations are recent start-ups. More FM also has additional unused radio frequencies in Christchurch and Invercargill. The new launches and other development opportunities should significantly increase More FM's operating profit and cash flows in fiscal 1998 and beyond. The outlook for the balance of the fiscal year continues to be very positive, especially in Canada and Australia, where the fourth quarter is performing well, pacing well ahead of the comparable period a year ago.

"Looking ahead to fiscal 1998, the Company is well-positioned for another strong year in each of its operations," said John Maguire, CanWest's Vice-President, Finance and CFO. "Renewal of all our hit programs combined with new program acquisitions position us for another successful year in 1997-98. Global Quebec, which will launch in September, will make a positive contribution to the Company's EBITDA in its first year of operation. That contribution should grow significantly in subsequent years as the new station matures in the Quebec marketplace. As well, completion of a multi-year program supply agreement with WIC provides increased profit contribution from Alberta."

"Results from New Zealand will be enhanced with the contribution from More FM," he added. "As well, we are encouraged with the early results of TV4 which launched successfully in early July, achieving audience share results which exceeded expectations."

Continued market growth in Australia will contribute positively to results of Network TEN. As well, the Company continues to explore alternatives for resolution to issues concerning our increased economic stake in Network TEN in a way which is acceptable to both the Australian government and the Company.

CanWest Global Communications Corp. (NYSE: CWG; TSE: CGS.S and CGS.A) is a leading international television broadcaster. In Canada, the Company owns and operates the CanWest Global System, Canada's most profitable private sector broadcaster. Internationally, the Company owns substantial economic interests in Australia's Network TEN and New Zealand's TV3 and TV4 television networks. Through these broadcasting operations, CanWest reaches approximately 35.8 million English-speaking people in markets that are estimated to have generated approximately C$4.4 billion in advertising expenditures. -0-

COMBINED FINANCIAL RESULTS (1)
(in thousands of Canadian dollars)

                 Nine Months Ended        Three Months Ended
              May 31  May 31  percent   May 31  May 31  percent
               1997    1996    Change    1997    1996   Change

Revenue
 Canada      294,027  262,681    11.9  103,623  91,185   13.6
 Australia   268,650  192,634    39.5   97,471  68,836   41.6
 New Zealand  69,292   31,936   117.0   23,593   9,183  156.9
             631,969  487,251    29.7  224,687 169,204   32.8

Broadcast
 operating
 profit before
 amortization
  Canada     122,549  100,113    22.4   44,444  33,565   32.4
  Australia   92,931   68,675    35.3   32,972  24,327   35.5
  New Zealand 21,517   10,795    99.3    5,058   1,289  292.4
             236,997  179,583    32.0   82,474  59,181   39.4

Corporate &
 development
 expenses     11,397    8,645    31.8    3,827   2,724   40.5

EBITDA       225,600  170,938    32.0   78,647  56,457   39.3

Earnings from
 continuing
 operations  117,319   82,490    42.2   36,481  25,500   43.1

Net earnings 117,319   83,447    40.6   36,481  25,500   43.1

Cash flow
 from continuing
 operations  148,175  106,835    38.7   48,660  33,149   46.8

Earnings per
 share from
 continuing
 operations (2)
   Basic       $0.79    $0.60    31.7    $0.25   $0.18   38.9
   Fully
    diluted    $0.78    $0.60    30.0    $0.24   $0.18   33.3

Cash flow per
 share (2)
   Basic       $1.00    $0.77    29.9    $0.33   $0.24   37.5
   Fully
    diluted    $0.99    $0.76    30.3    $0.32   $0.24   33.3


    NOTE: (1) Includes the Company's proportionate direct and
indirect interests in Network TEN.  (2) Per share results are
affected by the three million (nine million after stock split) share
issue in June 1996.

BACKGROUND INFORMATION TO CANWEST GLOBAL'S NINE MONTH REPORT, 1997 RESULTS OF OPERATIONS

The following discussion focuses upon financial results that have been prepared on a combined basis and are reported in Canadian dollars.

"Under Canadian GAAP, we are required to equity account our economic interest in Network TEN," said John Maguire, Vice-President, Finance and CFO. "We believe that by providing our shareholders with full financial disclosure, on a supplementary basis, of Network TEN's results proportionately consolidated into our financial statements, we more clearly reflect the true magnitude of our Company's broadcast operations."

It is important to note that earnings and earnings per share on a combined basis are the same as earnings and earnings per share reported on a Canadian GAAP basis.

The results being reported today reflect strong revenue growth at each of the Canadian operations and Network TEN in Australia, along with the increased economic interests in both Network TEN and TV3.

CanWest entered into an agreement to acquire Westpac Banking Corporation's interest in TV3, effective April 1, 1997. Because payment of the purchase price, due September 1, 1997, has been established at a fixed amount and has been secured by a letter of credit, generally accepted accounting rules in Canada require consolidation of TV3 results from the date of the agreement, notwithstanding that the transaction was completed on April l, 1997. Consolidation of the TV3 results has provided the opportunity for the Company to correct an historical two-month lag in the recording of the results of TV3. Historically, CanWest had recorded its share of TV3 results based upon TV3's reporting of its quarterly results. Accordingly, the nine month results include the Company's share of TV3's results for an additional two months in fiscal 1997.

During the first quarter of fiscal 1997, CanWest financed the acquisition by an unrelated Australian company, of approximately 17 percent of the issued and outstanding shares of Network TEN (representing an approximate 8.5 percent economic interest in TEN). This transaction effectively increased CanWest's economic interest in Network TEN to approximately 66 percent. Further expansion, during the second quarter, of our financing activities in Australia, increased the Company's interest in Network TEN to approximately 76 percent.

NINE MONTHS ENDED MAY 31, 1997

Combined revenue for the nine months ended May 31, 1997 was $631,969,000 compared to $487,251,000 for the nine months ended May 31, 1996. This represented a 29.7 percent gain, reflecting strong performances in all sectors of the Company's broadcast operations.

In Canada, CanWest Global System's revenue for the first nine months of fiscal 1997 rose to $294,027,000, an 11.9 percent increase over the $262,681,000 reported last year. This revenue growth was attributable to the continued strength of CanWest's program schedule throughout the country and general improvement in advertising demand.

In Australia, Network TEN reported strong gains in revenue for the first nine months of fiscal 1997. TEN's contribution to the Company's revenue for the first three quarters of the year was up 39.5 percent to $268,650,000 from $192,634,000 reported during the first nine months of fiscal 1996. This increase reflected the contributions from the Perth and Adelaide stations which Network TEN acquired in late 1995. The results also include foreign exchange gains as Network TEN results have been converted at an average rate of $1.073 this year, compared to $1.035 last year. On a same station basis, Network TEN's airtime revenue before conversion to Canadian dollars was up approximately 8.3 percent over last year.

In New Zealand, TV3's contribution to CanWest's revenue was up 117 percent during the nine months ended May 31, 1997, rising to $69,292,000 compared to $31,936,000 reported during the same period a year ago. This increase reflected full consolidation of TV3's results effective November 1, 1996, as well as the inclusion of the Company's share of TV3's results for an additional two months in the first quarter. On a comparable basis, TV3's revenues were up 4.0 percent over the previous year, reflecting continued gains in audience share and an increased share of revenue in a soft advertising market. TV3's results have been converted at an average rate of $0.9524 compared to $0.9014 last year.

Combined operating profit before amortization and corporate and development costs (broadcast operating profit) for the nine months ended May 31, 1997 rose 32.0 percent to $236,997,000 from the $179,583,000 reported in prior year. Broadcast operating profit growth across the Company's three operations reflected the revenue increases noted above, coupled with controlled increases in operating cost expenses.

In Canada, broadcast operating profit totaled $122,549,000 for the first nine months of fiscal 1997, a 22.4 percent increase over last year's total of $100,113,000. This increase was stemmed directly from revenue growth combined with tight control on operating costs.

In Australia, Network TEN's contribution to CanWest's broadcast operating profit was up 35.3 percent to $92,931,000 for the nine months ended May 31, 1997. This compared with $68,675,000 for the same period a year ago. The increase was due primarily to CanWest's increased economic interest in Network Ten, a full year's contributions from the Perth and Adelaide stations and increased audience share. TEN's reported broadcast operating profit was up 9.5 percent over the prior year.

In New Zealand, TV3's broadcast operating profit contribution increased by 99.3 percent to $21,517,000 versus $10,795,000 last year. This increase reflected the full consolidation of TV3 results as well as inclusion of results for an additional two months in the current year. On a same period basis, TV3's broadcast operating profit for the nine months was comparable with the previous year.

Combined operating profit before amortization, but after corporate development expenses (EBITDA) rose 32.0 percent to $225,600,000 for the first nine months of fiscal 1997, up from $170,938,000 in fiscal 1996.

Earnings from continuing operations rose 42.2 percent to $117,319,000 in the first three quarters of fiscal 1997 from $82,490,000 during the same period a year ago.

Cash flow from continuing operations rose 38.7 percent to $148,175,000 from $106,835,000 in the first nine months last year. Growth in cash flow reflects the increased profitability of the Company.

Earnings per share were $0.79 for the first nine months of fiscal 1997 compared to $0.60 per share last year. Cash flow per share was $1.00 in 1997 versus $0.77 per share last year. Per share results were affected by the dilution created by the issuance of 9 million non-voting shares in June 1996.

CONTACT: CanWest Global Communications Corp.

John E. Maguire, 204/956-2025

204/947-9841 (FAX)