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黑料吃瓜总站 Reports Fourth Quarter Results

November 21, 2024 (TORONTO) 鈥 黑料吃瓜总站 Network Canada Corp. (鈥満诹铣怨献苷锯 or the 鈥淐ompany鈥) today released financial information for the three months and year ended August 31, 2024.

Management鈥檚 Discussion and Analysis

Consolidated Financial Statements

鈥淲hile we continue to operate in a challenging advertising marketplace dominated by large, foreign media platforms, 黑料吃瓜总站 achieved some important milestones during the quarter that give us optimism around the future of Canadian news media. It is clear from our digital audience that Canadians look to us to provide accurate and timely local, provincial, and national news,鈥 said Andrew MacLeod, President and CEO.

鈥淲e are appreciative of the Ontario government鈥檚 recent policy change to support local media in Ontario. We hope to see similar initiatives from governments and corporate Canada.

We are encouraged by the successful completion of the C-18 negotiations and look forward to the release of funding.

The improving environment gave us confidence to both step into a challenging situation in Atlantic Canada and save local news brands that have operated in those provinces for over 150 years and to invest millions of dollars in a new digital platform with improved capabilities.

While we are seeing successes, this work must be augmented and supported by a renewed commitment from Canadian governments to ensure trusted journalism is delivered for Canadians across the country.鈥

Fourth Quarter Operating Results

Revenue for the quarter was $93.2 million as compared to $101.3 million in the same period in the prior year, representing a decrease of $8.1 million (8.0%). The revenue decrease was primarily due to decreases in advertising revenue of $3.6 million (7.7%) circulation revenue of $2.3 million (6.7%) and other revenue of $2.8 million (32.8%), partially offset by increases in parcel revenue of $0.6 million (5.1%).

Total operating expenses excluding depreciation, amortization and restructuring decreased $18.5 million, or 18.6%, for the quarter ended August 31, 2024, relative to the same period in the prior year. The decrease relates to decreases in compensation, newsprint, production and other operating expenses, partially offset by an increase in distribution expense.

Operating income before depreciation, amortization and restructuring in the quarter was $12.2 million, an increase of $10.3 million relative to the same period in the prior year. The increase in operating income before depreciation, amortization and restructuring is due to a decrease in operating expenses excluding depreciation, amortization and restructuring, partially offset by a decrease in total revenue.

Net loss in the quarter ended August 31, 2024 was $3.1 million, as compared to a net loss of $11.0 million in the same period in the prior year. The decrease in net loss was primarily the result of an increase in operating income before depreciation, amortization and restructuring, an increase in foreign currency gains, and a decrease in restructuring expenses, partially offset by an increase in interest expense, loss on disposal of property, plant and equipment, right-of-use assets, and assets held-for-sale.

Fiscal 2024 Operating Results

Revenue for the year ended August 31, 2024 was $395.9 million as compared to $448.5 million in the same period in the prior year, a decrease of $52.6 million or 11.7%. The revenue decrease was primarily due to decreases in advertising revenue of $35.9 million (16.2%), circulation revenue of $16.9 million (11.5%) and other revenue of $7.6 million (20.4%), partially offset by increases in parcel revenue of $7.8 million (17.9%).

Total operating expenses excluding depreciation, amortization and restructuring decreased $56.7 million or 13.0% for the year ended August 31, 2024, relative to the same period in the prior year. The decrease relates to decreases in compensation, newsprint, production and other operating expenses, partially offset by an increase in distribution expense.

Operating income before depreciation, amortization and restructuring of $14.8 million in the year ended August 31, 2024 represents an increase of $4.2 million relative to the same period in the prior year. The increase is due to a decrease in operating expenses excluding depreciation, amortization and restructuring, partially offset by a decrease in total revenue.

Net loss in the year August 31, 2024 was $49.7 million, as compared to a net loss of $72.6 million in the same period in the prior year.  The decrease in net loss is primarily the result of an increase in operating income before depreciation, amortization and restructuring, an increase in gain on derivatives and financial assets and foreign currency gains, and a decrease in interest expense, partially offset by an increase in interest expense, an increase in loss on disposal of property and equipment, right-of-use assets, and assets held-for-sale.

Acquisition of The Halifax Herald Limited and Saltwire Network Inc.

On August 25, 2024, PNI Maritimes LP completed the purchase (the 鈥淪altwire Asset Purchase Transaction鈥) of certain businesses and assets of Saltwire Network Inc. and The Halifax Herald Limited (collectively, 鈥淪altwire鈥), pursuant to an Asset Purchase Agreement dated July 25, 2024 (the 鈥淪altwire Purchase Agreement鈥). 黑料吃瓜总站 intends to continue operations of certain Saltwire publications, leveraging existing 黑料吃瓜总站 newsmedia back-office resources and operational infrastructure to ensure there continues to be reliable and high-quality local news provided to the affected communities. The acquisition included Saltwire鈥檚 daily and weekly papers, and parcel delivery business. The purchase price consisted of $1 million of cash consideration and $3.1 million of estimated contingent consideration.

Additional Information

Additional information, including financial statements and management鈥檚 discussion and analysis can be found on the Company鈥檚 website at or on SEDAR+ at a.

Note: All dollar amounts are expressed in Canadian dollars unless otherwise specified.

About 黑料吃瓜总站 Network Canada Corp.

黑料吃瓜总站 Network Canada Corp. (TSX:PNC.A, PNC.B) is the holding company that owns 黑料吃瓜总站 Network Inc., a Canadian newsmedia company representing more than 130 brands across multiple print and digital platforms. Award-winning journalists and innovative product development teams bring engaging content to millions of people every week whenever and wherever they want it. This exceptional content, reach and scope offers advertisers and marketers compelling solutions to effectively reach target audiences. Our expertise in home delivery and expanding distribution network powers 黑料吃瓜总站 Parcel Services. For more information, visit , and .

Forward-Looking Information

This news release may include information that is 鈥渇orward-looking information鈥 under applicable Canadian securities laws. The Company has tried, where possible, to identify such information and statements by using words such as 鈥渂elieve,鈥 鈥渆xpect,鈥 鈥渋ntend,鈥 鈥渆stimate,鈥 鈥渁nticipate,鈥 鈥渕ay,鈥 鈥渨ill,鈥 鈥渃ould,鈥 鈥渨ould,鈥 鈥渟hould鈥 and similar expressions and derivations thereof in connection with any discussion of future events, trends or prospects or future operating or financial performance. Forward-looking statements in this news release include statements with respect the implementation and results of the Company鈥檚 transformation initiatives, continued benefits of historical results into future periods, the realization of anticipated cost savings, the identification and undertaking of ongoing cost savings initiatives. By their nature, forward-looking information and statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. These risks and uncertainties include, among others: competition from digital and other forms of media; the effect of economic conditions on advertising revenue; the ability of the Company to build out its digital media and online businesses; the failure to maintain current print and online newspaper readership and circulation levels; the realization of anticipated cost savings; possible damage to the reputation of the Company鈥檚 brands or trademarks; possible labour disruptions; possible environmental liabilities, litigation and pension plan obligations; fluctuations in foreign exchange rates and the prices of newsprint and other commodities.

For a complete list of our risk factors please refer to the section entitled 鈥淩isk Factors鈥 contained in our annual management鈥檚 discussion and analysis for the years ended August 31, 2024 and 2023. Although the Company bases such information and statements on assumptions believed to be reasonable when made, they are not guarantees of future performance and actual results of operations, financial condition and liquidity, and developments in the industry in which the Company operates, may differ materially from any such information and statements in this press release. Given these risks and uncertainties, undue reliance should not be placed on any forward-looking information or forward-looking statements, which speak only as of the date of such information or statements. Other than as required by law, the Company does not undertake, and specifically declines, any obligation to update such information or statements or to publicly announce the results of any revisions to any such information or statements.

For more information:

Media Contact
Communications
inquiries@postmedia.com

Investor Contact
John Bode
Executive Vice President, Chief Financial Officer and Chief Transformation Officer
investors@postmedia.com

Consolidated Statements of Operations