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Astral Media Reports Q3 Results

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  • Astral Media Inc.  today reported its financial results for the third quarter ended May 31, 2024, which saw continued growth in net earnings, EPS, EBITDA2 and cash flow from operations2.

    For the third quarter, consolidated net earnings1 grew by 7% to $56.2 million from $52.6 million for the same period last year, while diluted earnings per share grew 9% to $1.00 from $0.92 per share last year. Consolidated revenues for the third quarter totalled $265.5 million, a 1% decrease over the $268.0 million recorded last year for the same period. EBITDA2 rose by 2% to $89.2 million from $87.8 million for the same period last year. Cash flow from operations2 rose by 2% to $68.7 million for the third quarter compared to $67.3 million for the corresponding period last year.

    For the first nine months of the year, consolidated net earnings1 grew by 7% over last year to $150.1 million from $140.4 million, while diluted earnings per share1 grew 9% to $2.67 from $2.45 last year. Consolidated revenues for the first nine months of Fiscal 2024 totalled $770.1 million, a slight increase over the $767.8 million recorded last year for the same period. EBITDA2 rose by 2% to $245.6 million from $241.2 million for the same period last year. Cash flow from operations2 rose by 3% to $187.9 million for the first nine months of the year compared to $182.7 million for the corresponding period last year.

    “I am pleased by the third quarter results announced today and by Astral’s ability to continue to achieve a strong performance in spite of the challenging advertising market in which we operate,” said Ian Greenberg, President and Chief Executive Officer. “Our relentless focus on maintaining our operational margins, commitment towards new product development and innovation, and optimal treasury management practices, enabled us to deliver another strong quarter of earnings growth.”

    FINANCIAL AND OPERATIONAL HIGHLIGHTS

    Television

    Revenue decline of 2% for the quarter (1% growth for the nine-month period);

    EBITDA2 growth of 2% for the quarter (2% growth for the nine-month period2);

    Launch, on July 4, of the new Cartoon Network service, available to over one million subscribers on Cogeco, Eastlink and Telus.

    Radio

    Revenue decline of 1% for the quarter (2% decline for the nine-month period);

    EBITDA2 growth of 1% for the quarter (3% decline for the nine-month period).

    Out-of-Home

    Revenue growth of 3% for the quarter (8% growth for the nine-month period);

    EBITDA2 growth of 2% for the quarter (11% growth for the nine-month period);

    Announcement, on June 12, of the addition of two new Digital Network faces in the Greater Montréal region, bringing Astral’s popular national Digital Network to 41 faces;

    Announcement, on June 19, of the launch of a new innovative urban Digital Columns network of 30 faces in the heart of downtown Montréal.

    Corporate

    Following the announcement of the Bell-Astral Transaction3, the Company’s dividend payment scheduled for August 2024 and activity under the Normal Course Issuer Bid have been suspended;

    During the third quarter, the Company repaid $70.0 million of its long-term debt for a total of $100.0 million after nine months;

    On May 24, Astral shareholders approved the acquisition of all of the Company’s issued and outstanding shares by BCE Inc. 

    On May 25, the Québec Superior Court approved the plan of arrangement under section 192 of the Canada Business Corporations Act relative to the Bell-Astral Transaction3 and declared that the plan of arrangement is fair to shareholders of Astral.

     1. Excluding acquisition and other costs, as well as Bell-Astral transaction costs. See details in the “Additional IFRS and Non-IFRS Measures” in Appendix 1.

    2. See “Additional IFRS and Non-IFRS Measures” in Appendix 1.

    3. See the “Acquisition of Astral” section in the Management’s Discussion and Analysis.

    ASTRAL MEDIA INC.

    Interim Consolidated Statements of Earnings

    for the periods ended May 31, 2024 and 2024

    (in thousands of Canadian dollars except for per-share data)

    (unaudited)

    3 months 9 months

    2012 2024 2024 2024

    Revenues $ 265,522 $ 268,040 $ 770,125 $ 767,811

    Operating expenses 176,365 180,172 524,523 526,562

    Bell-Astral Transaction costs 6,232 – 6,232 –

    Acquisition and other costs 554 4,407 4,865 4,407

    Depreciation of property, plant and equipment 7,203 7,150 22,069 21,031

    Amortization of other intangible and non-current assets 1,985 1,516 5,923 6,030

    Financial expense, net 3,387 4,980 11,313 16,150

    Earnings before income taxes 69,796 69,815 195,200 193,631

    Income tax provision 18,608 20,275 53,251 56,346

    Net earnings $ 51,188 $ 49,540 $ 141,949 $ 137,285

    Earnings per share

    – Basic $ 0.92 $ 0.88 $ 2.55 $ 2.43

    – Diluted $ 0.91 $ 0.87 $ 2.53 $ 2.40

    ASTRAL MEDIA INC.

    Interim Consolidated Statements of Comprehensive Income

    for the periods ended May 31, 2024 and 2024

    (in thousands of Canadian dollars)

    (unaudited)

    3 months 9 months

    2012 2024 2024 2024

    Net earnings $ 51,188 $ 49,540 $ 141,949 $ 137,285

    Other comprehensive income

    Actuarial gain (loss) on employee future benefit plans, net of income tax expense (recovery) of ($1.9 million)

    and ($1.4 million) respectively for the three months, and ($5.6 million) and $0.1 million respectively for

    the nine months (5,271) (3,942) (15,634) 289

    Change in fair value of derivatives designated as cash flow hedges, net of income tax expense (recovery) of

    ($0.3 million) and $0.4 million respectively for the three months, and $0.3 million and $1.8 million

    respectively for the nine months (780) 1,030 853 4,734

    Comprehensive income $ 45,137 $ 46,628 $ 127,168 $ 142,308

    ASTRAL MEDIA INC.

    Interim Consolidated Statements of Cash Flows

    for the periods ended May 31, 2024 and 2024

    (in thousands of Canadian dollars)

    (unaudited)

    3 months 9 months

    2012 2024 2024 2024

    OPERATING ACTIVITIES

    Net earnings $ 51,188 $ 49,540 $ 141,949 $ 137,285

    Non-cash items:

    Stock-based compensation costs 5,681 1,759 9,705 5,975

    Depreciation and amortization 9,188 8,666 27,992 27,061

    Imputed interest, net 407 452 1,092 1,210

    Amortization of deferred financing costs 272 172 749 515

    Deferred tax expense 2,013 6,679 6,423 10,656

    Cash flows from operations 68,749 67,268 187,910 182,702

    Net change in non-cash operating items 8,666 14,294 (30,181) (5,762)

    Cash provided by operating activities 77,415 81,562 157,729 176,940

    INVESTING ACTIVITIES

    Additions to property, plant and equipment (9,271) (11,959) (21,653) (29,646)

    Additions to other intangible and non-current assets (899) (2,434) (3,195) (10,283)

    Business acquisition, net of cash acquired (301) – (11,821) –

    Cash used for investing activities (10,471) (14,393) (36,669) (39,929)

    FINANCING ACTIVITIES

    Repayment of long-term debt (70,000) (55,000) (100,000) (65,000)

    Deferred financing costs – – (2,017) –

    Stock options exercised 1,936 260 19,212 12,863

    Shares repurchased – (20,485) (14,126) (51,925)

    Dividends – (4) (27,923) (21,379)

    Cash used for financing activities (68,064) (75,229) (124,854) (125,441)

    Net change in cash (1,120) (8,060) (3,794) 11,570

    Cash – beginning of period 19,979 31,175 22,653 11,545

    Cash – end of period $ 18,859 $ 23,115 $ 18,859 $ 23,115

    ASTRAL MEDIA INC.

    Interim Consolidated Balance Sheets as at

    (in thousands of Canadian dollars)

    (unaudited)

    May 31, August 31, September 1,

    2012 2024 2024

    ASSETS

    Current

    Cash $ 18,859 $ 22,653 $ 11,545

    Accounts receivable 181,273 170,063 169,240

    Program and film rights 105,564 105,385 106,723

    Prepaid expenses and other current assets 29,239 29,096 29,451

    334,935 327,197 316,959

    Program and film rights 57,338 51,058 41,640

    Property, plant and equipment 195,004 195,508 180,616

    Broadcast licences 1,652,392 1,639,785 1,661,949

    Goodwill 118,489 116,016 116,016

    Other intangible and non-current assets 65,193 70,543 64,162

    Non-current financial assets 16,227 19,852 22,848

    Deferred tax assets 68,602 60,747 64,683

    $ 2,508,180 $ 2,480,706 $ 2,468,873

    LIABILITIES

    Current

    Accounts payable and accrued liabilities $ 130,837 $ 142,627 $ 143,780

    Provisions 3,073 4,621 3,380

    Income taxes payable 22,736 13,560 16,654

    Program and film rights payable 74,791 77,033 64,908

    Other current financial liabilities – 1,945 –

    231,437 239,786 228,722

    Long-term debt 422,865 524,133 588,447

    Deferred tax liabilities 159,578 152,455 144,424

    Program and film rights payable 10,447 8,839 12,668

    Provisions 5,740 5,453 5,244

    Other non-current liabilities 76,152 57,124 63,820

    Other non-current financial liabilities 9,791 10,116 20,311

    916,010 997,906 1,063,636

    SHAREHOLDERS’ EQUITY

    Capital stock 779,386 762,572 768,762

    Contributed surplus 18,588 17,278 18,903

    Retained earnings 794,753 704,360 624,609

    Accumulated other comprehensive loss (557) (1,410) (7,037)

    794,196 702,950 617,572

    1,592,170 1,482,800 1,405,237

    $ 2,508,180 $ 2,480,706 $ 2,468,873

    ASTRAL MEDIA INC.

    Business Segments

    for the periods ended May 31, 2024 and 2024

    (in thousands of Canadian dollars) (unaudited)

    3 months 9 months

    2012 2024 2024 2024

    REVENUES

    Television $ 151,488 $ 153,987 $ 445,601 $ 442,550

    Radio 89,376 90,096 251,864 258,123

    Out-of-Home 24,658 23,957 72,660 67,138

    $ 265,522 $ 268,040 $ 770,125 $ 767,811

    EBITDA(1)

    Television $ 59,117 $ 58,207 $ 167,390 $ 164,104

    Radio 29,456 29,227 75,443 77,710

    Out-of-Home 8,199 8,072 24,344 21,938

    Corporate (7,615) (7,638) (21,575) (22,503)

    $ 89,157 $ 87,868 $ 245,602 $ 241,249

    (1) See Appendix 1.

    ASTRAL MEDIA INC.

    Appendix 1

    Additional IFRS and Non-IFRS Measures

    for the periods ended May 31, 2024 and 2024

    (unaudited)

    ——————————————————————————–

    In addition to discussing earnings measures in accordance with International Financial Reporting Standards (“IFRS”), this Press Release provides the following additional IFRS and non-IFRS measures which are also factors used by the Company’s management and Board of Directors in monitoring and evaluating the performance of the Company and its business segments:

    Additional IFRS Measure

    Cash flow from operations is defined as cash provided by operating activities before the net change in non-cash operating items. This measure provides an indication of the Company’s ability to generate cash flows without considering certain timing and other factors causing variations in non-cash operating items.

    Non-IFRS Measures

    EBITDA (earnings before interest, taxes, depreciation and amortization) is provided to assist investors in determining the ability of the Company to generate cash flow from operating activities and to cover financial charges. Other items such as acquisition and other costs and Bell-Astral Transaction costs are also excluded from earnings in the determination of EBITDA as they are not considered to be in the ordinary course of business. EBITDA is also an indicator widely used for business valuation purposes. EBITDA margin is defined as the ratio obtained by dividing EBITDA by revenues.

    The following table reconciles IFRS measures disclosed in the unaudited interim consolidated statements of earnings for the periods ended May 31, 2024 and 2024 to EBITDA:

    3 months 9 months

    (in thousands of $) 2024 2024 2024 2024

    Earnings before income taxes 69,796 69,815 195,200 193,631

    Depreciation and amortization 9,188 8,666 27,992 27,061

    Financial expense, net 3,387 4,980 11,313 16,150

    Acquisition and other costs 554 4,407 4,865 4,407

    Bell-Astral Transaction costs 6,232 – 6,232 –

    EBITDA 89,157 87,868 245,602 241,249

    Net earnings and diluted earnings per share before acquisition and other costs and Bell-Astral Transaction costs. These measures provide an indication of the Company’s ability to generate earnings from its ongoing operations, by excluding some items such as acquisition and other costs and Bell-Astral Transaction costs as they are not considered to be in the ordinary course of business.

    The following tables reconcile IFRS measures disclosed in the unaudited interim consolidated statements of earnings for the periods ended May 31 2024 and 2024 to net earnings and diluted earnings per share before acquisition and other costs and Bell-Astral Transaction costs:

    3 months 9 months

    (in thousands of $) 2024 2024 2024

    Net earnings 51,188 49,540 141,949 137,285

    Acquisition and other costs, net of income taxes 406 3,091 3,604 3,091

    Bell-Astral Transaction costs, net of income taxes 4,570 – 4,570 –

    Net earnings before acquisition and other costs and Bell-Astral Transaction costs 56,164 52,631 150,123 140,376

    3 months 9 months

    (in dollars) 2024 2024 2024 2024

    Diluted earnings per share 0.91 0.87 2.53 2.40

    Acquisition and other costs, net of income taxes 0.01 0.05 0.06 0.05

    Bell-Astral Transaction costs, net of income taxes 0.08 – 0.08 –

    Diluted earnings per share before acquisition and other costs and Bell-Astral Transaction costs 1.00 0.92 2.67 2.45

    The above additional IFRS and non-IFRS measures do not have a standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies.


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