Torstar Corporation Reports Second Quarter Results
TORONTO, ON - Torstar Corporation (
Highlights for the second quarter:
- Ended the second quarter of 2017 with $48.4 million of cash and cash equivalents and $9.1 million of restricted cash; Torstar has no bank indebtedness.
- Our net loss attributable to equity shareholders was $7.0 million ($0.09 per share) in the second quarter of 2017. This compares to a net loss of $23.9 million ($0.30 per share) in the second quarter of 2016.
- Adjusted loss per share was $0.03 in the second quarter of 2017, an improvement of $0.10 from adjusted loss per share of $0.13 in the second quarter of 2016. Adjusted loss per share in 2017 and 2016 included $0.24 and $0.50 per share effects of amortization and depreciation.
- Our segmented operating loss was $8.1 million in the second quarter of 2017 which included $19.2 million of non-cash amortization and depreciation expense as well as $6.2 million of restructuring and other charges.
- Our segmented adjusted EBITDA was $18.0 million in the second quarter of 2017, up $1.8 million from the prior year. Segmented adjusted EBITDA in the Digital Ventures segment was $6.9 million in the quarter which benefitted from 32% growth in adjusted EBITDA at VerticalScope (27% growth in USD). In the newspaper operations, the segmented adjusted EBITDA at the Star Media Group was $0.8 million, an improvement of $1.5 million, while segmented adjusted EBITDA at the Metroland Media Group was $12.7 million, down $1.2 million in the quarter.
- Segmented revenue was $180.8 million in the second quarter of 2017, down $15.7 million (8%) from $196.5 million in the second quarter of 2016 which included revenue growth of $2.0 million or 22% (17% growth in USD) from VerticalScope.
"Segmented adjusted EBITDA was up $1.8 million to $18.0 million in the second quarter and included $6.9 million from our Digital Ventures segment which continues to benefit from very strong year over year growth in revenue and adjusted EBITDA at VerticalScope. At Metroland and the Star Media Group, we benefitted from continuing efforts on costs which offset the impact of the continuing challenges in the print advertising environment with earnings up $0.3 million across the two operations," said John Boynton, President and CEO of Torstar Corporation. "Looking forward, we expect earnings in the balance of the year to continue to benefit from growth at VerticalScope, helping to offset continued pressures on print advertising revenues in the newspaper operations. In addition, efforts to reduce cash outflow, along with recent regulatory developments related to minimum funding requirements for registered defined benefit pension plans are expected to provide Torstar with additional flexibility in the balance of 2017 and in 2018 as we progress through our transformation."
The following chart provides a continuity of earnings per share from the second quarter and first six months of 2016 to the second quarter and first six months of 2017:
| Three months ended June 30 | Six months ended June 30 | |||||||
Earnings (Loss) Per Share |
Adjusted Earnings (Loss) Per Share** |
Earnings (Loss) Per Share |
Adjusted Earnings (Loss) Per Share** |
|||||
| Loss per share from continuing operations attributable to equity shareholders in 2016 | ($0.30 |
) | ($0.13 |
) | ($0.96 |
) | ($0.53 |
) |
| Changes | ||||||||
| • Adjusted EBITDA* | 0.02 | 0.02 | 0.06 | 0.06 | ||||
| • Amortization and depreciation* | 0.27 | 0.27 | 0.57 | 0.57 | ||||
| • Operating earnings (loss)* | (0.01 | ) | 0.16 | (0.33 | ) | 0.10 | ||
| • Restructuring and other charges* | 0.01 | 0.34 | ||||||
| • Impairment of assets* | (0.04 | ) | ||||||
| • Operating profit (loss)* | 0.00 | 0.16 | (0.03 | ) | 0.10 | |||
| • Non-cash foreign exchange | 0.01 | (0.02 | ) | |||||
| • Income from associated businesses (excluding VerticalScope) | (0.01 | ) | (0.01 | ) | (0.02 | ) | (0.02 | ) |
| • Other income | (0.02 | ) | ||||||
| • Change in current and future taxes (including associated businesses) | (0.10 | ) | (0.18 | ) | (0.31 | ) | (0.32 | ) |
| Loss per share from continuing operations attributable to equity shareholders in 2017 | ($0.10 |
) | ($0.03 |
) | ($0.40 |
) | ($0.24 |
) |
| Earnings per share from discontinued operations attributable to equity shareholders in 2017 | $0.01 |
$0.01 |
||||||
| Loss per share attributable to equity shareholders in 2017 | ($0.09 | ) | ($0.03 | ) | ($0.39 | ) | ($0.24 | ) |
| * Includes proportionately consolidated share of joint venture and VerticalScope's operations. These include Non-IFRS or additional IFRS measures. |
| ** Refer to discussion of "Non-IFRS measures" including definition of adjusted earnings (loss) per share. |
| OPERATING RESULTS SECOND QUARTER 2017 | |||||||||||||||||||||
| The following tables sets out, in $000's the segmented results for the three months ended June 30, 2017 and 2016 | |||||||||||||||||||||
| Three months ended June 30, 2017 | |||||||||||||||||||||
|
(in $000's) |
MMG |
SMG |
Digital Ventures |
Corporate |
Total Segmented* |
Adjustments & Eliminations1 |
Total Per Consolidated Statement of Loss |
||||||||||||||
| Operating revenue | $100,793 | $61,621 | $18,358 | $180,772 | ($19,015 | ) | $161,757 | ||||||||||||||
| Salaries and benefits | (43,821 | ) | (21,352 | ) | (5,649 | ) | ($1,562 | ) | (72,384 | ) | 5,928 | (66,456 | ) | ||||||||
| Other operating costs | (44,227 | ) | (39,480 | ) | (5,763 | ) | (919 | ) | (90,389 | ) | 5,562 | (84,827 | ) | ||||||||
| Adjusted EBITDA** | 12,745 | 789 | 6,946 | (2,481 | ) | 17,999 | (7,525 | ) | 10,474 | ||||||||||||
| Amortization & depreciation | (3,793 | ) | (8,086 | ) | (7,317 | ) | (19,196 | ) | 6,779 | (12,417 | ) | ||||||||||
| Share based compensation | (206 | ) | (22 | ) | (491 | ) | 75 | (644 | ) | 644 | - | ||||||||||
| Operating earnings (loss)** | 8,746 | (7,319 | ) | (862 | ) | (2,406 | ) | (1,841 | ) | (102 | ) | (1,943 | ) | ||||||||
| Restructuring and other charges | (3,265 | ) | (2,604 | ) | (142 | ) | (200 | ) | (6,211 | ) | 141 | (6,070 | ) | ||||||||
| Operating profit (loss)** | $5,481 | ($9,923 | ) | ($1,004 | ) | ($2,606 | ) | ($8,052 | ) | $39 | ($8,013 | ) | |||||||||
| Loss from continuing operations | ($7,499 | ) | |||||||||||||||||||
| Income from discontinued operations | $500 | ||||||||||||||||||||
| Net loss | ($6,999 | ) | |||||||||||||||||||
| Three months ended June 30, 2016 | |||||||||||||||||||||
|
(in $000's) |
MMG |
SMG |
Digital Ventures |
Corporate |
Total Segmented* |
Adjustments & Eliminations1 |
Total Per Consolidated Statement of Loss |
||||||||||||||
| Operating revenue | $108,175 | $71,155 | $17,209 | $196,539 | ($18,627 | ) | $177,912 | ||||||||||||||
| Salaries and benefits | (47,995 | ) | (29,412 | ) | (5,706 | ) | ($1,770 | ) | (84,883 | ) | 6,104 | (78,779 | ) | ||||||||
| Other operating costs | (46,223 | ) | (42,445 | ) | (6,126 | ) | (651 | ) | (95,445 | ) | 6,226 | (89,219 | ) | ||||||||
| Adjusted EBITDA** | 13,957 | (702 | ) | 5,377 | (2,421 | ) | 16,211 | (6,297 | ) | 9,914 | |||||||||||
| Amortization & depreciation | (3,293 | ) | (9,500 | ) | (27,887 | ) | (6 | ) | (40,686 | ) | 27,499 | (13,187 | ) | ||||||||
| Share based compensation | |||||||||||||||||||||