Quebecor Media Reports Net Income Of $7.6 Million For First Quarter Of 2003.Business Editors MONTREAL--(BUSINESS WIRE)--May 8, 2003 Quebecor Quebecor Inc. TSX: QBR (written without an accent on the first e, even in French) is a large Quebec-based communications company. It was founded by Pierre Péladeau, and remains run by his family. Quebecor Inc. has two operating subsidiaries:
TSX Transfer from Stack Pointer to Index TSX True Space Extension :QBR QBR Quarterly Business Review QBR Quality Billing Report QBR Quarterly Billing Report .A) (TSX:QBR.F): Highlights -- 10.1% growth in operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. -- Net income of $7.6 million in Q1 2003 versus net loss of $22.1 million in Q1 2002 -- $429.0 million term loan paid down on April 22, 2003 -- Star Academie demonstrates the power of convergence Quebecor Media Inc. today reported total revenues of $550.2 million for the first quarter of 2003, compared with $549.5 million for the same quarter of 2002. Operating income rose $13.1 million or 10.1% to $142.7 million due to stronger profits in the Cable Television segment and a notable improvement in operating results in the Web Integration/Technology and Internet/Portals segments. The operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of those two segments were virtually eliminated. These improvements more than offset the decrease in operating income in the Business Telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. segment. Net income was $7.6 million in the first quarter of 2003, compared with a net loss of $22.1 million in the same quarter of 2002. It was the Company's best earnings performance in more than two years. Financial expenses decreased by $11.1 million from $80.2 million in the first quarter of 2002 to $69.1 million in the same quarter of 2003, due primarily to the favourable impact of the conversion of the unhedged portion of the long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. and to a net gain on settlement of debt, which was realized on the refinancing Refinancing An extension and/or increase in amount of existing debt. of Sun Media Corporation's debt and on the voluntary repayment of a portion of Videotron's debt. Unusual items (reserve for restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). , write-down Write-Down Reducing the book value of an asset because it is overvalued compared to the market value. Notes: This is usually reflected in the company's income statement as an expense, thereby reducing net income. of temporary investments, non-monetary compensation charge, write-down of goodwill and gains (losses) on sales of businesses and other assets other assets Assets of relatively small value. For financial reporting purposes, firms frequently combine small assets into a single category rather than listing each item separately. ) amounted to $0.9 million in 2003, compared with $17.9 million in 2002. Star Academie: the power of convergence One of the highlights of the quarter was the television program Star Academie, broadcast on the TVA TVA: see Tennessee Valley Authority. network between February February: see month. 16 and April 20, 2003. The program's resounding re·sound v. re·sound·ed, re·sound·ing, re·sounds v.intr. 1. To be filled with sound; reverberate: The schoolyard resounded with the laughter of children. 2. success demonstrated the originality o·rig·i·nal·i·ty n. pl. o·rig·i·nal·i·ties 1. The quality of being original. 2. The capacity to act or think independently. 3. Something original. Noun 1. and scope of Quebecor Media's convergence strategy. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. BBM's People Meter The People Meter is a device and system used by Nielsen Media Research in the USA to allow a relatively passive measurement of the viewing habits of TV and cable audiences. The people meter was invented by a British company called Audits of Great Britain, or AGB for short. ratings, the 90-minute Star Academie special on Sunday Sunday: see Sabbath; week. , April 13, 2003 was seen by over 3 million viewers, an all-time all-time adj. Exceeding all others up to the present time: an all-time speed skating record. all-time Adjective Informal record for a program broadcast on the TVA network. The following week, the final episode captured 83% of the viewing audience during its time slot Continuously repeating interval of time or a time period in which two devices are able to interconnect. . At its height, Star Academie was seen by nearly half (47.4%) of Quebec's French-speaking adj. 1. able to communicate in French. Adj. 1. French-speaking - able to communicate in French communicatory, communicative - able or tending to communicate; "was a communicative person and quickly told all she knew"- W.M.Thackeray population (aged 2 and over). TVA Publishing's celebrity weeklies covered the event and reaped significantly increased newsstand sales. For example, sales of 7 Jours magazine were up more than 44% from the same period of 2002. The program also received daily coverage in Le Journal de Montreal Montreal (mŏn'trēôl`), Fr. Montréal (môNrāäl`), city (1991 pop. 1,017,666), S Que., Canada, on Montreal island, surrounded by St. Lawrence River and Rivière des Prairies. and Le Journal de Quebec Quebec, city, Canada Quebec, Fr. Québec, city (1991 pop. 167,517), provincial capital, S Que., Canada, at the confluence of the St. Lawrence and St. Charles rivers. . Subscribers to Videotron's high-speed Internet See broadband. service had exclusive access to webcams providing live backstage feeds. The unique advantage brought Videotron a significant number of new customers. For its part, Netgraphe developed tools to support voting, video feeds, interactivity and chat sessions with the contestants. During the program's run, Netgraphe logged more than 304,000 registrations on the Star Academie site, 5.9 million unique visitors A count of how many different people access a Web site. For example, if a user leaves and comes back to the site five times during the measurement period, that person is counted as one unique visitor, but would count as five "user sessions. and over 135 million page views. The project generated revenues of more than $400,000 for Netgraphe. Meanwhile, the Videotron Telecom subsidiary created a new Video Streaming See streaming video and video stream. service to meet the short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. needs of major projects such as Star Academie. Select, Archambault Group's music distribution arm, distributed the Star Academie CD, which was certified See certification. platinum (100,000 copies sold) out of the box and quintuple quin·tu·ple adj. 1. Consisting of five parts or members. 2. Five times as much in size, strength, number, or amount. n. A fivefold amount or number. tr. & intr.v. platinum (500,000 copies sold) by April 20, 2003, the date of the grand finale For the music notation program, see . A finale (italian word) is a closing part, act or movement of a dramatic or musical composition, or more generally any event or procedure with a dramatically concluding effect. , making it the fastest selling quintuple platinum album ever 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 . The CD was prominently displayed at all Archambault locations and at more than a hundred Le SuperClub
Cable Television The Cable Television segment's first quarter 2003 revenues amounted to $180.4 million, compared with $179.9 million in the same quarter of 2002. Revenue increases of $11.8 million from the high-speed high-speed adj. 1. Operated or designed for operation at high speed: a high-speed food processor. 2. Taking place at high speed: a high-speed chase. 3. cable Internet Internet access via the cable companies. There are two kinds of service. One uses a cable modem to connect to a computer, and the other uses an enhanced cable box that provides Internet access directly at the TV. access service and $6.7 million from the illico Illico is a free bimonthly French LGBT magazine, founded in March of 1988. Overview It has a circulation of around 40,000 and is composed primarily of articles and opinion polls about current events, as well as information relating to gay culture, activism, and digital television service more than compensated for lower revenues from analog cable television, dial-up Internet access See dial-up. , installation and other services. At quarter end, there were 182,000 subscribers to the illico service, an increase of 50% from the same date of the previous year. Subscriptions to the high-speed Internet service grew 33% from 251,000 to 334,000 over the same period. Videotron signed up 11,000 new subscribers to illico during the quarter and lost 18,000 customers to its analog cable television service, for a net loss of 7,000 customers, compared with a net loss of 26,000 customers during the same period of 2002. Videotron also gained 23,000 new customers for its Internet access See how to access the Internet. services during the quarter. Operating income amounted to $70.8 million, compared with $67.3 million in the first quarter of 2002, an increase of $3.5 million or 5.2%. The rise in operating income resulted primarily from the growth in the customer base for the high-speed Internet access service and higher operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: for that service, generated by increased rates and lower bandwidth bandwidth Measurement of the capacity of a communications signal. For digital signals, the bandwidth is the data speed or rate, measured in bits per second (bps). For analog signals, it is the difference between the highest and lowest frequency components, measured in hertz costs. Reduced operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. and improved productivity were also factors in the increase in operating income. Videotron's average operating margin for all operations increased from 37.4% in the first quarter of 2002 to 39.2% in the same quarter of 2003. On March 20, 2003, Videotron and its employees in the Montreal and Quebec City areas reached an agreement in principle on renewal of their collective agreements, ending the labour dispute that began on May 8, 2002. The new labour contracts signed on April 29, 2003 will enable Videotron to reduce costs, enhance productivity, and exercise greater flexibility in the management of its operations. Newspapers Sun Media Corporation reported first-quarter revenues of $201.3 million, an increase of $1.3 million from the same period of 2002. A 2.7% increase in advertising revenues was partially offset by lower circulation, distribution and printing revenues. First-quarter operating income increased $0.6 million, or 1.3%, from $44.6 million to $45.2 million, mainly as a result of lower newsprint newsprint low grade paper used for newspapers. Old newspapers are fed to cattle as an alternative roughage and may occasionally be ingested by dogs. Significant amounts of lead are accumulated in tissues; no cases of poisoning have been recorded in cattle, though it has been prices. Sun Media Corporation undertook the refinancing of its debt at the beginning of the quarter. The subsidiary subsequently announced an increase in the amount of the refinancing in view of the positive response from investors. On February 7, 2003, it closed a private placement of Senior Notes in the net amount of US$201.5 million and contracted new bank credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities totalling $425.0 million. These funds were used to pay down Sun Media Corporation's loans in full and to pay a $260 million dividend to Quebecor Media, of which $150.0 million was used to reduce Videotron ltee's long-term debt. Broadcasting TVA Group's revenues totalled $84.3 million in the first quarter of 2003, up 9.1% from $77.3 million in the same quarter of 2002. The increase was due to growth in broadcasting revenues and the inclusion of Publicor's results since its acquisition by TVA Publishing in the second quarter of 2002. These two factors outweighed the decrease in revenues from production and international distribution operations resulting from TVA's repositioning repositioning Laparoscopic surgery The changing of a Pt's position during a procedure to improve access or visualization of the operative field, which may be linked to complications, as it changes anatomic planes of operation. Cf Laparoscopic surgery. in this area. Operating income rose 9.0% from $13.3 million to $14.5 million, due mainly to the improved profitability of TVA's publishing operations as a result of synergies yielded by the integration of Publicor in May 2002. Leisure and Entertainment The Leisure and Entertainment segment reported quarterly revenues of $51.6 million, compared with $57.4 million in the same quarter of 2002, a 10.1% decrease. The lower figures were due to the transfer of the Publicor magazines from the Leisure and Entertainment segment to the Broadcasting segment in the second quarter of 2002, and lower revenues in the Books segment as a result of the sale of Editions Wilson Wilson, city (1990 pop. 36,930), seat of Wilson co., E N.C., in a rich agricultural region; inc. 1849. It is a commercial and industrial center with a large tobacco market. Manufactures include textile goods (especially clothing), metal products, and processed foods. & Lafleur in the fourth quarter of 2002. Archambault Group and Le SuperClub Videotron reported revenue increases of 7.3% and 7.1% respectively. The segment's operating income amounted to $5.5 million, compared with $5.7 million in the same period of 2002. The growth in operating income at Archambault Group and Le SuperClub Videotron, as well as a smaller operating loss in the Books segment, almost entirely offset the impact of the removal of magazines from the segment. The highlights of the first quarter included the retail success of the Star Academie CD, the excellent performance of Archambault Group's retail network, increased sales of Videotron products at Le SuperClub Videotron locations, and lower administrative expenses following the reorganization of the general literature publishing houses under Editions Quebecor Media. Business Telecommunications Videotron Telecom Ltd. (VTL See virtual tape library. ) recorded first quarter 2003 revenues of $21.8 million, compared with $22.2 million in the same period of the previous year. The positive impact of the acquisition of the assets of Stream Intelligent Networks in Ontario Ontario, city, United States Ontario, city (1990 pop. 133,179), San Bernardino co., S Calif., near Los Angeles, in a region of vineyards; inc. 1891. did not entirely compensate for the sharp decrease in Internet-related revenues as a result of the renegotiation of the service agreement with Videotron and other factors. The segment's operating income amounted to $5.8 million, compared with $7.5 million in the same quarter of 2002. The $1.7 million decrease was caused mainly by the lower Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the revenues and increased operating expenses resulting from the acquisition of Stream Intelligent Networks. Web Integration/Technology The Web Integration/Technology segment reported quarterly revenues of $17.1 million versus $20.8 million in the same quarter of 2002, a 17.8% decrease. The lower revenues reflect soft demand in the IT and Internet advertising Delivering ads to Internet users via Web sites, e-mail, ad-supported software and Internet-enabled cellphones. Also called an "ad network," Internet advertising organizations act as a middleman between the advertiser and the Web sites and software publishers that display the ads. markets, the sale of the Nurun Nurun Inc. (TSX: NUR), a subsidiary of Quebecor Media Inc., is a global company which strategizes, executes, and measures interactive programs that use new technologies.[1] Nurun is known as nurun ant|farm interactive in the United States. Technologies office in Paris, and the closing of the Mindready Solutions office in Paignton Paignton: see Torbay. , Great Britain Great Britain, officially United Kingdom of Great Britain and Northern Ireland, constitutional monarchy (2005 est. pop. 60,441,000), 94,226 sq mi (244,044 sq km), on the British Isles, off W Europe. The country is often referred to simply as Britain. . The segment's operating loss was only $88,000, compared with a loss of $8.0 million in the first quarter of 2002. The improvement resulted primarily from the recording under operating expenses in the first quarter of 2002 of special charges related to the restructuring of Mindready's operations. Cost reductions and improved productivity at all Mindready and Nurun offices (except Milan) were also factors. Nurun signed several major contracts during the quarter, including a three-year exclusive agreement with Bombardier Recreational Products to develop and maintain its Web sites, confirmation of a contract extension with Evian Evian is a French brand of mineral water from several sources near Évian-les-Bains, on the south shore of Lake Geneva. Today, Evian is owned by Danone Group, a French multinational company. Evian first entered the U.S. in the US following the joint venture agreement between Evian and Coca-Cola Coca-Cola soft drink found throughout the world. [Trademarks:Crowley Trade, 115] See : Ubiquity , and a contract with a major customer of Quebecor World in partnership with its Q-Net MediaTM subsidiary. Internet/Portals The Internet/Portals segment's first-quarter revenues totalled $7.0 million, compared with $7.4 million in the same quarter of 2002. The special-interest portals MatchContact.com, Autonet.ca and Jobboom.com continued posting strong growth, with an 18.5% increase in revenues. The robust performance did not entirely make up for the decrease in revenues from the general-interest portals, particularly in English-language markets, and the closing or sale of CANOE's European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. portals. The segment has broken even in terms of operating income for the past three quarters. In the first quarter of 2003, it generated operating income of $0.4 million, compared with an operating loss of $1.8 million in the same period of 2002. The strong performance was mainly the result of the decisive restructuring measures introduced since the second quarter of 2001 and the improved profitability of the special-interest portals, particularly Jobboom.com. Financial position At March 31, 2003, the Company and its subsidiaries had cash, cash equivalents and liquid investments with remaining maturities Remaining maturity The length of time remaining until a bond comes due greater than three months totalling $175.3 million, consisting mainly of short-term investments. The Company and its wholly owned subsidiaries Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. also had unused lines of credit of $240.0 million available, for total available liquid assets Cash, or property immediately convertible to cash, such as Securities, notes, life insurance policies with cash surrender values, U.S. savings bonds, or an account receivable. of $415.3 million. At the same date, the consolidated debt, including the short-term portion of the long-term debt but excluding redeemable Redeemable Eligible for redemption under the terms of an indenture. preferred shares Preferred shares Preferred shares give investors a fixed dividend from the company's earnings and entitle them to be paid before common shareholders. See: Preferred stock. , totalled $3.15 billion, including Sun Media Corporation's $623.4 million debt, Videotron ltee's $951.3 million debt, TVA Group's $49.4 million debt, and Quebecor Media's own debt, which includes Senior Notes in an aggregate amount of $1.31 billion and a term loan of $212.8 million. At the beginning of 2003, Quebecor Media issued redeemable preferred shares in the amount of $216.1 million. On April 22, 2003, these shares were converted to common shares. On the same date, Quebecor Media issued common shares totalling $214.3 million. The proceeds from these stock offerings were used to pay down in full the $429.0 million term loan coming due on April 23, 2003. Operating income The Company defines operating income (or loss) as earnings (or loss) before amortization charges, financial expenses, reserves for restructuring of operations and special charges, write-downs of goodwill, gains (losses) on the sale of businesses and other assets, income taxes, and non-controlling interest. Special charges include write-downs of temporary investments and non-monetary compensation charges. Operating income (or loss) as defined above is not a measure of results that is consistent 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 . It is not intended to be regarded as an alternative to other financial operating performance measures or to the statement of cash flows as a measure of liquidity. It is not intended to represent funds available for debt service, dividends, reinvestment Reinvestment Using dividends, interest and capital gains earned in an investment or mutual fund to purchase additional shares or units, rather than receiving the distributions in cash. 1. In terms of stocks, it is the reinvestment of dividends to purchase additional shares. or other discretionary uses, and should not be considered in isolation or as a substitute for measures of performance prepared 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. Operating income (or loss) is used by the Company because management believes it is a meaningful measure of performance. Operating income (or loss) is commonly used by the investment community to analyze and compare the performance of companies in the industries in which the Company is engaged. It facilitates year-over-year comparison of results since operating income (or loss) excludes, among other things, unusual items that are not readily comparable from year to year. The Company's definition of operating income may not be identical to similarly titled measures reported by other companies. 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. Except for historical information contained herein, the statements in this document are forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. and made pursuant to the safe harbour provisions 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. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Company's actual results in future periods to differ materially from the forecasted results. Those risks include changes in customer demand for the Company's products, changes in raw material and equipment costs and availability, seasonal fluctuations in customer orders, pricing actions by competitors and general changes in the economic environment. The Company Quebecor Media Inc., a subsidiary of Quebecor Inc. (TSX: QBR.A, QBR.B), operates in Canada, the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , France, Italy Italy (ĭt`əlē), Ital. Italia, officially Italian Republic, republic (2005 est. pop. 58,103,000), 116,303 sq mi (301,225 sq km), S Europe. and the UK. It is engaged in newspaper publishing (Sun Media Corporation), cable television (Videotron ltee), broadcasting (TVA Group Inc.), Web technology and integration (Nurun Inc. and Mindready Solutions Inc.), Internet portals (Netgraphe Inc.), magazines (TVA Publishing Inc.), books (a dozen associated publishing houses), distribution and retailing of cultural products (Archambault Group Inc. and Le SuperClub Videotron ltee) and business telecommunications (Videotron Telecom Ltd.).
QUEBECOR MEDIA INC. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions of canadian dollars)
(Unaudited)
Three months ended March 31
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2003 2002
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REVENUES
Cable Television $ 180.4 $ 179.9
Newspapers 201.3 200.0
Broadcasting 84.3 77.3
Leisure and Entertainment 51.6 57.4
Business Telecommunications 21.8 22.2
Web Integration/Technology 17.1 20.8
Internet/Portals 7.0 7.4
Head Office 0.1 0.9
Intersegment (13.4) (16.4)
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550.2 549.5
COSTS OF SALES AND SELLING AND
ADMINISTRATIVE EXPENSES (407.5) (419.9)
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OPERATING INCOME BEFORE UNDER-NOTED ITEMS 142.7 129.6
Amortization (61.0) (60.1)
Financial expenses (69.1) (80.2)
Reserve for restructuring of operations (0.1) (3.1)
Write-down of temporary investments (0.4) (5.4)
Non-monetary compensation charges - (1.2)
Write-down of goodwill - (8.9)
(Losses) gains on sale of businesses and other assets (0.4) 0.7
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INCOME (LOSS) BEFORE INCOME TAXES 11.7 (28.6)
Income taxes:
Current 2.6 (4.2)
Future (3.8) 5.9
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(1.2) 1.7
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12.9 (30.3)
Non-controlling interest (5.3) 8.2
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NET INCOME (LOSS) $ 7.6 $ (22.1)
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QUEBECOR MEDIA INC. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (continued)
(in millions of canadian dollars)
(Unaudited)
Three months ended March 31
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2003 2002
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SEGMENTED INFORMATION
Operating income before amortization, financial
expenses, reserve for restructuring of operations,
write-down of temporary investments, non-monetary
compensation charges, write-down of goodwill and
(losses) gains on sale of businesses and other assets
Cable Television $ 70.8 $ 67.3
Newspapers 45.2 44.6
Broadcasting 14.5 13.3
Leisure and Entertainment 5.5 5.7
Business Telecommunications 5.8 7.5
Web Integration/Technology (0.1) (8.0)
Internet/Portals 0.4 (1.8)
General corporate income 0.6 1.0
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$ 142.7 $ 129.6
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Amortization
Cable Television $ 37.7 $ 35.8
Newspapers 6.7 6.3
Broadcasting 3.1 2.9
Leisure and Entertainment 2.6 3.0
Business Telecommunications 9.1 8.8
Web Integration/Technology 1.0 1.2
Internet/Portals 0.4 1.3
Head Office 0.4 0.8
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$ 61.0 $ 60.1
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CONSOLIDATED STATEMENT OF DEFICIT
(in millions of canadian dollars)
(Unaudited)
Three months ended March 31
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2003 2002
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Deficit at beginning of period
As previously reported $ 2,780.0 $ 411.5
Restatement due to a change in accounting policy
regarding foreign currency translation - 10.2
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As restated 2,780.0 421.7
Reduction due to a change in accounting policy
regarding goodwill - 2,144.3
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2,780.0 2,566.0
Net (income) loss (7.6) 22.1
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Deficit at end of period $ 2,772.4 $ 2,588.1
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QUEBECOR MEDIA INC. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions of canadian dollars)
(Unaudited)
Three months ended March 31
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2003 2002
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Cash flow related to operations:
Net income (loss) $ 7.6 $ (22.1)
Adjustments for:
Amortization of property, plant and equipment 54.8 54.3
Write-down of goodwill and amortization of
deferred charges 6.2 14.7
Amortization of deferred financing costs and
long-term debt discount 14.4 12.7
Non-monetary compensation charges - 1.2
Write-down of temporary investments 0.4 5.4
Interest on redeemable preferred shares 9.8 5.2
(Gains) losses on foreign currency translation
on long-term debt (8.7) 0.6
Losses (gains) on sale of businesses
and other assets 0.7 (0.7)
Future income taxes (3.8) 5.9
Non-controlling interest 5.3 (8.2)
Other 1.1 (0.4)
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87.8 68.6
Net change in non-cash balances related to operations
(net of the effect of business
acquisitions and disposals) (124.5) (62.8)
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Cash flow (used by) provided by operations (36.7) 5.8
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Cash flows related to financing activities:
Net decrease in bank indebtedness (6.1) (1.6)
Issuance of long-term debt 701.8 0.1
Repayment of long-term debt (917.1) (40.2)
Increase in deferred financing costs (11.1) -
Proceed from issuance of redeemable
preferred shares 216.1 -
Dividends paid to non-controlling shareholders (1.3) (1.4)
(Increase) decrease in advance receivable
from parent company (3.9) 3.7
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Cash flow used for financing activities (21.6) (39.4)
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Cash flows related to investing activities:
Businesses acquisitions, net of cash and cash
equivalents acquired (9.0) (0.3)
Proceeds from disposal of businesses, net of cash
and cash equivalents disposed (0.2) 1.1
Acquisitions of property, plant and equipment (26.7) (38.3)
Additions to others assets (7.9) (14.0)
Decrease (increase) of temporary investments 87.1 (0.3)
Proceeds from disposal of assets 2.3 9.3
Others 0.3 (1.0)
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Cash flows provided by (used in) investing activities 45.9 (43.5)
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Net decrease in cash and cash equivalents (12.4) (77.1)
Effect of exchange rate changes on cash and
cash equivalents denominated in foreign currencies (0.9) (1.0)
Cash and cash equivalents at beginning of period 188.3 207.8
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Cash and cash equivalents at end of period $ 175.0 $ 129.7
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SEGMENTED INFORMATION
Additions to property, plant and equipment:
Cable Television $ 16.9 $ 23.9
Newspapers 1.4 0.7
Broadcasting 2.0 2.0
Leisure and Entertainment 1.5 1.5
Business Telecommunications 4.7 9.7
Web Integration/Technology 0.2 0.5
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$ 26.7 $ 38.3
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QUEBECOR MEDIA INC. AND ITS SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in millions of Canadian dollars)
March 31 December 31
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2003 2002
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(unaudited) (audited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 175.0 $ 188.3
Temporary investments (market value of $0.3
million ($87.9 million in 2002)) 0.3 87.8
Accounts receivable 310.2 329.8
Income taxes receivable 21.7 28.8
Inventories and investments in televisual
products and movies 146.6 156.9
Prepaid expenses 23.8 18.6
Future income taxes 31.9 31.9
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709.5 842.1
PORTFOLIO INVESTMENTS (market value of $16.0
million ($15.9 million in 2002)) 16.0 15.9
ADVANCES RECEIVABLE FROM PARENT COMPANY 30.0 26.1
PROPERTY, PLANT AND EQUIPMENT 1,649.5 1,680.3
GOODWILL 3,885.9 3,883.4
FUTURE INCOME TAXES 97.9 97.9
OTHER ASSETS 187.7 239.0
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$ 6,576.5 $ 6,784.7
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LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Bank indebtedness $ 7.0 $ 13.1
Accounts payable and accrued charges 557.3 699.2
Income and other taxes 9.3 9.3
Advances payable to parent company and companies
under common control 8.1 22.6
Future income taxes 0.9 0.9
Current portion of long-term debt 90.6 575.6
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673.2 1,320.7
LONG-TERM DEBT 3,061.6 2,931.0
REDEEMABLE PREFERRED SHARES 480.1 254.2
OTHER LIABILITIES 133.7 51.4
FUTURE INCOME TAXES 255.5 258.5
NON-CONTROLLING INTEREST 192.2 195.3
SHAREHOLDERS' EQUITY:
Capital stock 1,341.8 1,341.8
Contributed surplus 3,214.6 3,214.6
Deficit (2,772.4) (2,780.0)
Translation adjustment (3.8) (2.8)
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1,780.2 1,773.6
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$ 6,576.5 $ 6,784.7
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