MONTREAL, QUEBEC--(Marketwired - June 8, 2017) - Transcontinental Inc. (TSX:TCL.A)(TSX:TCL.B)
Highlights
- Revenues increased by $1.5 million, or 0.3%.
- Operating earnings increased by $51.5 million, from $16.3 million to $67.8 million. Adjusted operating earnings, which exclude restructuring and other costs (revenues) and impairment of assets, increased by $7.5 million, or 13.3%.
- Net earnings increased by $41.0 million, from $5.4 million to $46.4 million. Adjusted net earnings, which exclude restructuring and other costs (revenues) and impairment of assets, net of related taxes, increased by $8.3 million, or 24.3%.
- Sold the media assets in Atlantic Canada.
- Ongoing process to sell the local newspapers in Quebec and Ontario.
- Renewed the normal course issuer bid in the normal course of business of the Corporation.
- Ranked by Corporate Knights as one of the Best 50 Corporate Citizens in Canada.
Transcontinental Inc. (TSX:TCL.A)(TSX:TCL.B) announces its results for the second quarter of Fiscal 2017, which ended April 30, 2017.
"We had a very satisfying quarter that reflects once again the soundness of our strategy, and we diligently continue the transformation of the Corporation", said François Olivier, President and Chief Executive Officer of TC Transcontinental.
"In the printing division, the results of our retailer-related services were solid, and we began to provide the new services under the terms of the expanded agreement with Lowe's Canada. Within our packaging activities, we continued to generate organic growth and develop our North American sales force. In addition, we successfully completed the integration of Flexstar Packaging. As for the Media Sector, the announcement of a process to sell our local newspapers is a turning point in our transformation. This ongoing process generates considerable interest in all the markets where we are present."
"With our excellent financial position and our significant cash flows, we are continuing to focus on our transformation. We are well positioned to ensure our growth and remain very active in our acquisition-based approach to building our North American flexible packaging platform."
| Financial Highlights | ||||||||||||
| (in millions of dollars, except per share amounts) | Q2-2017 | Q2-2016 | Variation in % |
SIX MONTHS 2017 |
SIX MONTHS 2016 |
Variation in % |
||||||
| Revenues | $ | 498.7 | $ | 497.2 | 0.3 | % | $ | 1,002.3 | $ | 996.1 | 0.6 | % |
| Operating earnings before depreciation and amortization (EBITDA) | 94.2 | 43.2 | N.M. | 183.2 | 121.6 | 50.7 | ||||||
| Adjusted operating earnings before depreciation and amortization(Adjusted EBITDA)(1) | 90.1 | 83.1 | 8.4 | 178.0 | 167.0 | 6.6 | ||||||
| Operating earnings (EBIT) | 67.8 | 16.3 | N.M. | 130.2 | 67.9 | 91.8 | ||||||
| Adjusted operating earnings (Adjusted EBIT)(1) | 63.7 | 56.2 | 13.3 | 125.0 | 113.3 | 10.3 | ||||||
| Net earnings | 46.4 | 5.4 | N.M. | 89.1 | 42.7 | N.M. | ||||||
| Net earnings per share | 0.60 | 0.07 | N.M. | 1.15 | 0.55 | N.M. | ||||||
| Adjusted net earnings(1) | 42.5 | 34.2 | 24.3 | 83.8 | 75.6 | 10.8 | ||||||
| Adjusted net earnings per share(1) | 0.55 | 0.44 | 25.0 | 1.08 | 0.97 | 11.3 | ||||||
| (1) | Please refer to the table "Reconciliation of Non-IFRS financial measures" in this press release for adjusted data presented above. |
2017 Second Quarter Results
Revenues went from $497.2 million in the second quarter of 2016 to $498.7 million in the second quarter of 2017, an increase of 0.3%. The contribution from acquisitions, in particular in the packaging division, more than offset the loss of revenues related to disposals and closures in the Media Sector, as well as the organic decline in revenues. In the printing division, the organic decline in revenues was mitigated by an increase in demand from Canadian retailers for printed flyers, premedia services and in-store marketing printing services, as well as the stable volume for door-to-door distribution services. The additional volume associated with the new expanded agreement with Lowe's Canada was integrated into our platform only at the end of the second quarter of 2017. In addition, the agreement to print the Toronto Star mitigated the organic decline by partially offsetting the lower volume in several niches caused by the decline in advertising spending and the completion of the agreement to print Canada's Census forms in 2016. The packaging division, once again, recorded an organic increase in revenues. In the Media Sector, the decline in advertising revenues continued to contribute to the organic decline in revenues of the local newspaper publishing activities.
Operating earnings increased by $51.5 million, from $16.3 million in the second quarter of 2016 to $67.8 million in the second quarter of 2017. Adjusted operating earnings went from $56.2 million in the second quarter of 2016 to $63.7 million in the second quarter of 2017, an increase of 13.3%. This increase is attributable to the contribution from acquisitions, the favourable exchange rate effect and the organic growth in adjusted operating earnings. This organic growth is mostly attributable to the increase in demand from Canadian retailers for above-mentioned services and the agreement to print the Toronto Star, the organic growth in revenues from the packaging division, as well as the favourable impact of Corporation-wide cost reduction initiatives. However, the contribution from these items was partially offset by the above-mentioned decrease in revenues and investments made to develop the packaging division's platform and strengthen this division's sales force.
Net earnings increased by $41.0 million, from $5.4 million in the second quarter of 2016 to $46.4 million in the second quarter of 2017. This increase is mostly attributable to a decrease in the asset impairment charge and in restructuring and other costs (revenues) and, to a lesser extent, an increase in adjusted operating earnings, partially offset by the increase in income taxes. On a per share basis, net earnings increased from $0.07 to $0.60. Excluding restructuring and other costs (revenues) and impairment of assets, net of related income taxes, adjusted net earnings increased by $8.3 million, or 24.3%, from $34.2 million in the second quarter of 2016 to $42.5 million in the second quarter of 2017. On a per share basis, adjusted net earnings increased from $0.44 to $0.55.
2017 First Six Months Results
Revenues went from $996.1 million in the first six months of 2016 to $1,002.3 million in the first six months of 2017, an increase of 0.6%. The contribution from acquisitions, in particular in the packaging division, and the favourable exchange rate effect more than offset the loss of revenues related to disposals and closures in the Media Sector, as well as the organic decline in revenues. In the printing division, the organic decline in revenues was mitigated by an increase in demand from Canadian retailers for printed flyers, premedia services and in-store marketing printing services, as well as the stable volume for door-to-door distribution services. In addition, the agreement to print the Toronto Star mitigated the organic decline by partially offsetting the lower volume in several niches caused by the decline in advertising spending and the completion of the agreement to print Canada's Census forms in 2016. The packaging division recorded an organic increase in revenues. In the Media Sector, the decline in advertising revenues continued to contribute to the organic decline in revenues of the local newspaper publishing activities.
Operating earnings increased $62.3 million, from $67.9 million in the first six months of 2016 to $130.2 million in the corresponding period in 2017. Adjusted operating earnings went from $113.3 million in the first six months of 2016 to $125.0 million in the first six months of 2017, an increase of 10.3%. Excluding the $9.0 million unfavourable effect of the stock-based compensation expense as a result of the change in the share price in the first six months of 2017 compared to the same period in 2016, adjusted operating earnings increased 18.3%. The contribution from acquisitions, the favourable exchange rate effect and the organic growth in adjusted operating earnings sustained this increase. This organic growth is attributable to the increase in demand from Canadian retailers for above-mentioned services and the agreement to print the Toronto Star, the organic growth in revenues from the packaging division, as well as the favourable impact of Corporation-wide cost reduction initiatives. However, the contribution from these items was partially offset by the above-mentioned decrease in revenues and investments made to develop the packaging division's platform and strengthen this division's sales force.
Net earnings increased by $46.4 million, from $42.7 million in the first six months of 2016 to $89.1 million in the corresponding period in 2017. This increase is mostly attributable to a decrease in the asset impairment charge and in restructuring and other costs (revenues) and, to a lesser extent, an increase in adjusted operating earnings, partially offset by the increase in income taxes. On a per share basis, net earnings increased from $0.55 to $1.15. Excluding restructuring and other costs (revenues) and impairment of assets, net of related income taxes, adjusted net earnings increased by $8.2 million, or 10.8%, from $75.6 million in the first six months of 2016 to $83.8 million in the corresponding period in 2017. On a per share basis, adjusted net earnings increased from $0.97 to $1.08.
For more detailed financial information, please see the Management's Discussion and Analysis for the second quarter ended April 30, 2017 as well as the financial statements in the "Investors" section of our website at www.tc.tc
Outlook for 2017
In the printing division, considering the additional contribution from the expanded agreement with Lowe's Canada, we expect a slight increase in revenues from our services to retailers, in particular flyer and in-store marketing printing, and door-to-door distribution and premedia services. We will also benefit, in part, from the contribution from the agreement to print the Toronto Star, which started in July 2016, and we are pursuing, as part of our long-term strategy, our initiatives to secure new newspaper printing outsourcing contracts. Our newspaper and magazine printing revenues will continue to be affected by a decrease in volume resulting from the decrease in circulation and number of printed pages for the publications of several publishers. Furthermore, our commercial printing activities will continue to be affected by the reduction in print advertising. To offset these decreases, we will benefit, in the short term, from the impact of the closure of the Saskatoon and Dartmouth printing plants, which occurred in May and July 2016 respectively, and we will continue our operational efficiency initiatives.
In our packaging division, we will benefit from the contribution from the acquisition of Robbie Manufacturing, which was completed at the end of June 2016, and from the acquisition of Flexstar Packaging, completed in mid-October of last year. Furthermore, once fully integrated, these acquisitions will also generate synergies. We also expect that the investments we made to develop our platform and strengthen our sales force will further contribute to organic growth. Lastly, we will maintain our disciplined acquisition approach in this promising market in order to invest in quality assets that meet our strategic criteria.
In the Media Sector, the sale of our media assets in Atlantic Canada and the continuation of the process to sell our local newspapers in Quebec and Ontario will result in the decrease of the share of our local newspaper publishing activities in our business portfolio. However, we believe that the negative impact of the transformation of the advertising market on our portfolio of publications unsold by the end of the fiscal year will continue, but will be partially offset by changes that would be made to the organizational structure. With respect to the Business and Education group, we will benefit from our acquisition of financial brands and we expect that the organic growth in revenues and adjusted operating earnings of this group will remain strong.
To conclude, we expect to generate significant cash flows and maintain our excellent financial position, which should enable us to continue investing to support our transformation into flexible packaging.
Reconciliation of Non-IFRS Financial Measures
The financial information has been prepared in accordance with IFRS. However, financial measures used, namely the adjusted operating earnings, the adjusted operating earnings before depreciation and amortization, the adjusted net earnings, the adjusted net earnings per share, the net indebtedness and the net indebtedness ratio, for which a complete definition is presented in the Management's Discussion and Analysis for the second quarter ended April 30, 2017, and for which a reconciliation is presented in the following table, do not have any standardized meaning under IFRS and could be calculated differently by other companies. We believe that many of our readers analyze the financial performance of the Corporation's activities based on these non-IFRS financial measures as such measures may allow for easier comparisons between periods. These measures should be considered as a complement to financial performance measures in accordance with IFRS. They do not substitute and are not superior to them.
We also believe that the adjusted operating earnings before depreciation and amortization, the adjusted operating earnings, that takes into account the impact of past investments in property, plant and equipment and intangible assets, and the adjusted net earnings are useful indicators of the performance of our operations. Furthermore, management also uses some of these non-IFRS financial measures to assess the performance of its activities and managers.
Regarding the net indebtedness and net indebtedness ratio, we believe that these indicators are useful to measure the Corporation's financial leverage and ability to meet its financial obligations.
| Reconciliation of operating earnings - Second quarter and cumulative | ||||||||||
| Three months ended April 30 | Six months ended April 30 | |||||||||
| (in millions of dollars) | 2017 | 2016 | 2017 | 2016 | ||||||
| Operating earnings | $ | 67.8 | $ | 16.3 | $ | 130.2 | $ | 67.9 | ||
| Restructuring and other costs (revenues) | (4.1 | ) | 9.6 | (6.4 | ) | 15.1 | ||||
| Impairment of assets | - | 30.3 | 1.2 | 30.3 | ||||||
| Adjusted operating earnings | $ | 63.7 | $ | 56.2 | $ | 125.0 | $ | 113.3 | ||
| Depreciation and amortization | 26.4 | 26.9 | 53.0 | 53.7 | ||||||
| Adjusted operating earnings before depreciation and amortization | $ | 90.1 | $ | 83.1 | $ | 178.0 | $ | 167.0 | ||
| Reconciliation of net earnings - Second quarter | ||||||||||
| Three months ended April 30 | ||||||||||
(in millions of dollars, except per share amounts) |
2017 | 2016 | ||||||||
| Total | Per share | Total | Per share | |||||||
| Net earnings | $ | 46.4 | $ | 0.60 | $ | 5.4 | $ | 0.07 | ||
| Restructuring and other costs (revenues), net of related taxes | (3.9 | ) | (0.05 | ) | 6.9 | 0.09 | ||||
| Impairment of assets, net of related taxes | - | - | 21.9 | 0.28 | ||||||
| Adjusted net earnings | $ | 42.5 | $ | 0.55 | $ | 34.2 | $ | 0.44 | ||
| Reconciliation of net earnings - Cumulative | ||||||||||
| Six months ended April 30 | ||||||||||
(in millions of dollars, except per share amounts) |
2017 | 2016 | ||||||||
| Total | Per share | Total | Per share | |||||||
| Net earnings | $ | 89.1 | $ | 1.15 | $ | 42.7 | $ | 0.55 | ||
| Restructuring and other costs (revenues), net of related taxes | (6.2 | ) | (0.08 | ) | 11.0 | 0.14 | ||||
| Impairment of assets, net of related taxes | 0.9 | 0.01 | 21.9 | 0.28 | ||||||
| Adjusted net earnings | $ | 83.8 | $ | 1.08 | $ | 75.6 | $ | 0.97 | ||
| Reconciliation of net indebtedness | ||||||||
| (in millions of dollars, except ratios) | As at April 30, 2017 | As at October 31, 2016 | ||||||
| Long-term debt | $ | 348.0 | $ | 347.9 | ||||
| Current portion of long-term debt | - | 0.2 | ||||||
| Cash | (113.4 | ) | (16.7 | ) | ||||
| Net indebtedness | $ | 234.6 | $ | 331.4 | ||||
| Adjusted operating earnings before depreciation and amortization (last 12 months) | $ | 401.1 | $ | 390.1 | ||||
| Net indebtedness ratio | 0.6 | x | 0.8 | x | ||||
Dividend
The Corporation's Board of Directors declared a quarterly dividend of $0.20 per share on Class A Subordinate Voting Shares and Class B Shares. This dividend is payable on July 19, 2017 to shareholders of record at the close of business on July 3, 2017.
Conference Call
Upon releasing its second quarter 2017 results, the Corporation will hold a conference call for the financial community today at 4:15 p.m. The dial-in numbers are 1 647 788-4922 or 1 877 223-4471. Media may hear the call in listen-in only mode or tune in to the simultaneous audio broadcast on the Corporation's website, which will then be archived for 30 days. For media requests or interviews, please contact Nathalie St-Jean, Senior Advisor, Communications of TC Transcontinental, at 514 954-3581.
Profile
Canada's largest printer with operations in print, flexible packaging, publishing and digital media, TC Transcontinental's mission is to create products and services that allow businesses to attract, reach and retain their target customers.
Respect, teamwork, performance and innovation are strong values held by the Corporation and its employees. The Corporation's commitment to its stakeholders is to pursue its business and philanthropic activities in a responsible manner.
Transcontinental Inc. (TSX:TCL.A)(TSX:TCL.B), known as TC Transcontinental, has more than 7,000 employees in Canada and the United States, and revenues of C$2.0 billion in 2016. Website www.tc.tc
Forward-looking Statements
Our public communications often contain oral or written forward-looking statements which are based on the expectations of management and inherently subject to a certain number of risks and uncertainties, known and unknown. By their very nature, forward-looking statements are derived from both general and specific assumptions. The Corporation cautions against undue reliance on such statements since actual results or events may differ materially from the expectations expressed or implied in them. Forward-looking statements may include observations concerning the Corporation's objectives, strategy, anticipated financial results and business outlook. The Corporation's future performance may also be affected by a number of factors, many of which are beyond the Corporation's will or control. These factors include, but are not limited to, the economic situation in the world and particularly in Canada and the United States, structural changes in the industries in which the Corporation operates, the exchange rate, availability of capital, energy costs, competition, the Corporation's capacity to engage in strategic transactions and integrate acquisitions into its activities, the regulatory environment, the safety of its packaging products used in the food industry, innovation of its offering and concentration of its sales in certain segments. The main risks, uncertainties and factors that could influence actual results are described in Management's Discussion and Analysis (MD&A) for the fiscal year ended October 31, 2016, in the latest Annual Information Form and have been updated in the MD&A for the second quarter ended April 30, 2017.
Unless otherwise indicated by the Corporation, forward-looking statements do not take into account the potential impact of nonrecurring or other unusual items, nor of divestitures, business combinations, mergers or acquisitions which may be announced after the date of June 8, 2017.
The forward-looking statements in this press release are made pursuant to the "safe harbour" provisions of applicable Canadian securities legislation.
The forward-looking statements in this release are based on current expectations and information available as at June 8, 2017. Such forward-looking information may also be found in other documents filed with Canadian securities regulators or in other communications. The Corporation's management disclaims any intention or obligation to update or revise these statements unless otherwise required by the securities authorities.
| CONSOLIDATED STATEMENTS OF EARNINGS | |||||||||
| Unaudited | |||||||||
| Three months ended | Six months ended | ||||||||
| April 30 | April 30 | ||||||||
| (in millions of Canadian dollars, except per share data) | 2017 | 2016 | 2017 | 2016 | |||||
| Revenues | $ | 498.7 | $ | 497.2 | $ | 1,002.3 | $ | 996.1 | |
| Operating expenses | 408.6 | 414.1 | 824.3 | 829.1 | |||||
| Restructuring and other costs (revenues) | (4.1 | ) | 9.6 | (6.4) | 15.1 | ||||
| Impairment of assets | - | 30.3 | 1.2 | 30.3 | |||||
| Operating earnings before depreciation and amortization | 94.2 | 43.2 | 183.2 | 121.6 | |||||
| Depreciation and amortization | 26.4 | 26.9 | 53.0 | 53.7 | |||||
| Operating earnings | 67.8 | 16.3 | 130.2 | 67.9 | |||||
| Net financial expenses | 4.4 | 6.4 | 9.5 | 9.5 | |||||
| Earnings before share of net earnings in interests in joint ventures and income taxes | 63.4 | 9.9 | 120.7 | 58.4 | |||||
| Share of net earnings in interests in joint ventures, net of related taxes | 0.1 | 0.3 | - | 0.3 | |||||
| Income taxes | 17.1 | 4.8 | 31.6 | 16.0 | |||||
| Net earnings | $ | 46.4 | $ | 5.4 | $ | 89.1 | $ | 42.7 | |
| Net earnings per share - basic | $ | 0.60 | $ | 0.07 | $ | 1.15 | $ | 0.55 | |
| Net earnings per share - diluted | $ | 0.60 | $ | 0.07 | $ | 1.15 | $ | 0.55 | |
| Weighted average number of shares outstanding - basic (in millions) | 77.4 | 77.6 | 77.3 | 77.8 | |||||
| Weighted average number of shares - diluted (in millions) | 77.6 | 77.9 | 77.5 | 78.1 | |||||
| CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||||||||||||
| Unaudited | ||||||||||||||
| | | Three months ended April 30 | | | Six months ended April 30 | | ||||||||
| (in millions of Canadian dollars) | 2017 | 2016 | 2017 | 2016 | ||||||||||
| Net earnings | $ | 46.4 | $ | 5.4 | $ | 89.1 | $ | 42.7 | ||||||
| Other comprehensive income (loss) | ||||||||||||||
| Items that will be reclassified to net earnings | ||||||||||||||
| Net change related to cash flow hedges | ||||||||||||||
| Net change in the fair value of derivatives designated as cash flow hedges | (2.3 | ) | 12.8 | (0.9 | ) | 6.3 | ||||||||
| | | Reclassification of the net change in the fair value of derivatives designated as cash flow hedges in prior periods, recognized in net earnings during the period | | 0.4 | | | 4.1 | | | 0.8 | | | 6.1 | |
| Related income taxes | (0.5 | ) | 4.6 | - | 3.3 | |||||||||
| (1.4 | ) | 12.3 | (0.1 | ) | 9.1 | |||||||||
| Cumulative translation differences | ||||||||||||||
| | | Net unrealized exchange gains (losses) on the translation of the financial statements of foreign operations | | 19.7 | | | (34.8 | ) | | 10.3 | | | (15.2 | ) |
| | | Net change in the fair value of derivatives designated as hedges of net investments in foreign operations | | (2.2 | ) | | 3.7 | | | (1.0 | ) | | 3.0 | |
| Related income taxes | (0.6 | ) | 1.0 | (0.3 | ) | 0.8 | ||||||||
| 18.1 | (32.1 | ) | 9.6 | (13.0 | ) | |||||||||
| Items that will not be reclassified to net earnings | ||||||||||||||
| Changes in actuarial gains and losses in respect of defined benefit plans | ||||||||||||||
| Actuarial gains (losses) in respect of defined benefit plans | (1.2 | ) | (5.4 | ) | 18.6 | (23.3 | ) | |||||||
| Related income taxes | (0.4 | ) | (1.4 | ) | 5.0 | (6.2 | ) | |||||||
| (0.8 | ) | (4.0 | ) | 13.6 | (17.1 | ) | ||||||||
| Other comprehensive income (loss) | 15.9 | (23.8 | ) | 23.1 | (21.0 | ) | ||||||||
| Comprehensive income (loss) | $ | 62.3 | $ | (18.4 | ) | $ | 112.2 | $ | 21.7 | |||||
| CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | ||||||||||||||||
| Unaudited | ||||||||||||||||
| (in millions of Canadian dollars) | ||||||||||||||||
| Share capital | Contributed surplus | Retained earnings | Accumulated other comprehensive income (loss) | | Total equity | |||||||||||
| Balance as at October 31, 2016 | $ | 361.9 | $ | 3.2 | $ | 700.9 | $ | 2.7 | $ | 1,068.7 | ||||||
| Net earnings | - | - | 89.1 | - | 89.1 | |||||||||||
| Other comprehensive income | - | - | - | 23.1 | 23.1 | |||||||||||
| Shareholders' contributions and distributions to shareholders | ||||||||||||||||
| Exercise of stock options | 6.7 | (1.3 | ) | - | - | 5.4 | ||||||||||
| Dividends | - | - | (29.8 | ) | - | (29.8 | ) | |||||||||
| Balance as at April 30, 2017 | $ | 368.6 | $ | 1.9 | $ | 760.2 | $ | 25.8 | $ | 1,156.5 | ||||||
| Balance as at October 31, 2015 | $ | 368.2 | $ | 3.2 | $ | 625.5 | $ | 19.4 | $ | 1,016.3 | ||||||
| Net earnings | - | - | 42.7 | - | 42.7 | |||||||||||
| Other comprehensive loss | - | - | - | (21.0 | ) | (21.0 | ) | |||||||||
| Shareholders' contributions and distributions to shareholders | ||||||||||||||||
| Share redemptions | (3.0 | ) | - | (6.4 | ) | - | (9.4 | ) | ||||||||
| Exercise of stock options | 0.5 | (0.1 | ) | - | - | 0.4 | ||||||||||
| Dividends | - | - | (27.6 | ) | - | (27.6 | ) | |||||||||
| Balance as at April 30, 2016 | $ | 365.7 | $ | 3.1 | $ | 634.2 | $ | (1.6 | ) | $ | 1,001.4 | |||||
| CONSOLIDATED STATEMENTS OF FINANCIAL POSITION | |||||
| Unaudited | |||||
| (in millions of Canadian dollars) | | As at April 30, 2017 | | As at October 31, 2016 | |
| Current assets | |||||
| Cash | $ | 113.4 | $ | 16.7 | |
| Accounts receivable | 345.5 | 401.9 | |||
| Income taxes receivable | 12.3 | 5.8 | |||
| Inventories | 116.3 | 119.6 | |||
| Prepaid expenses and other current assets | 17.3 | 15.9 | |||
| 604.8 | 559.9 | ||||
| Property, plant and equipment | 535.7 | 566.0 | |||
| Intangible assets | 192.2 | 217.0 | |||
| Goodwill | 514.8 | 509.7 | |||
| Investments in joint ventures | 2.9 | 2.9 | |||
| Deferred taxes | 158.7 | 171.3 | |||
| Other assets | 37.0 | 35.4 | |||
| $ | 2,046.1 | $ | 2,062.2 | ||
| Current liabilities | |||||
| Accounts payable and accrued liabilities | $ | 272.1 | $ | 326.4 | |
| Provisions | 5.2 | 9.8 | |||
| Income taxes payable | 1.3 | 3.5 | |||
| Deferred revenues and deposits | 53.1 | 55.4 | |||
| Current portion of long-term debt | - | 0.2 | |||
| 331.7 | 395.3 | ||||
| Long-term debt | 348.0 | 347.9 | |||
| Deferred taxes | 41.6 | 43.4 | |||
| Provisions | 1.9 | 2.9 | |||
| Other liabilities | 166.4 | 204.0 | |||
| 889.6 | 993.5 | ||||
| Equity | |||||
| Share capital | 368.6 | 361.9 | |||
| Contributed surplus | 1.9 | 3.2 | |||
| Retained earnings | 760.2 | 700.9 | |||
| Accumulated other comprehensive income | 25.8 | 2.7 | |||
| 1,156.5 | 1,068.7 | ||||
| $ | 2,046.1 | $ | 2,062.2 | ||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
| Unaudited | ||||||||||||||
| Three months ended April 30 | Six months ended April 30 | |||||||||||||
| (in millions of Canadian dollars) | 2017 | 2016 (2) | 2017 | 2016 (2) | ||||||||||
| Operating activities | ||||||||||||||
| Net earnings | $ | 46.4 | $ | 5.4 | $ | 89.1 | $ | 42.7 | ||||||
| | Adjustments to reconcile net earnings and cash flows from operating activities: | | | | | | | | | | | | | |
| Impairment of assets | - | 30.3 | 1.2 | 30.3 | ||||||||||
| Depreciation and amortization | 32.5 | 34.2 | 65.5 | 67.8 | ||||||||||
| Financial expenses on long-term debt | 4.3 | 4.4 | 8.7 | 9.0 | ||||||||||
| Net losses (gains) on disposal of assets | 0.2 | 0.3 | (2.8 | ) | 0.7 | |||||||||
| Income taxes | 17.1 | 4.8 | 31.6 | 16.0 | ||||||||||
| Net foreign exchange differences and other | (7.6 | ) | 15.7 | (7.3 | ) | 1.3 | ||||||||
| | Cash flows generated by operating activities before changes in non-cash operating items and income taxes paid | | 92.9 | | | 95.1 | | | 186.0 | | | 167.8 | | |
| Changes in non-cash operating items (1) | (14.0 | ) | 14.5 | (14.5 | ) | 3.4 | ||||||||
| Income taxes paid | (20.2 | ) | (17.3 | ) | (31.8 | ) | (44.6 | ) | ||||||
| Cash flows from operating activities | 58.7 | 92.3 | 139.7 | 126.6 | ||||||||||
| Investing activities | ||||||||||||||
| Business combinations | (7.8 | ) | (9.9 | ) | (16.0 | ) | (9.9 | ) | ||||||
| Business disposals | 25.1 | - | 25.2 | 0.5 | ||||||||||
| Acquisitions of property, plant and equipment | (6.3 | ) | (13.7 | ) | (16.8 | ) | (27.8 | ) | ||||||
| Disposals of property, plant and equipment | 0.3 | 0.2 | 7.0 | 0.2 | ||||||||||
| Increase in intangible assets | (6.1 | ) | (6.3 | ) | (10.2 | ) | (10.9 | ) | ||||||
| Cash flows from investing activities | 5.2 | (29.7 | ) | (10.8 | ) | (47.9 | ) | |||||||
| Financing activities | ||||||||||||||
| Reimbursement of long-term debt | (0.1 | ) | (13.5 | ) | (0.2 | ) | (13.6 | ) | ||||||
| Net decrease in credit facility | - | (14.0 | ) | - | (22.0 | ) | ||||||||
| Financial expenses on long-term debt | (2.7 | ) | (2.8 | ) | (8.2 | ) | (8.2 | ) | ||||||
| Interest received related to previous tax reassessments | - | 2.5 | - | 7.9 | ||||||||||
| Exercise of stock options | 0.2 | 0.4 | 5.4 | 0.4 | ||||||||||
| Dividends | (15.5 | ) | (14.4 | ) | (29.8 | ) | (27.6 | ) | ||||||
| Share redemptions | - | - | - | (9.4 | ) | |||||||||
| Cash flows from financing activities | (18.1 | ) | (41.8 | ) | (32.8 | ) | (72.5 | ) | ||||||
| Effect of exchange rate changes on cash denominated in foreign currencies | 0.6 | (3.5 | ) | 0.6 | (1.9 | ) | ||||||||
| Net change in cash | 46.4 | 17.3 | 96.7 | 4.3 | ||||||||||
| Cash at beginning of period | 67.0 | 25.6 | 16.7 | 38.6 | ||||||||||
| Cash at end of period | $ | 113.4 | $ | 42.9 | $ | 113.4 | $ | 42.9 | ||||||
| Non-cash investing activities | ||||||||||||||
| Net change in capital asset acquisitions financed by accounts payable | $ | (1.4 | ) | $ | 4.0 | $ | (1.4 | ) | $ | 3.2 | ||||
| (1) | During the three-month period ended January 31, 2016, an amount of $31.0 million was received and recognized as deferred revenues. |
| (2) | Certain comparative figures have been reclassified to conform to the presentation adopted in the current period. |
Contact Information:
Nathalie St-Jean, Senior Advisor, Communications
TC Transcontinental
514-954-3581
nathalie.st-jean@tc.tc
www.tc.tc
Financial Community
Shirley Chenny, Advisor, Investor Relations
TC Transcontinental
514-954-4166
shirley.chenny@tc.tc
www.tc.tc