Skip to main content
The Globe and Mail
Support Quality Journalism
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); }
TSX Real-Time Last Sale CAD
Today's Change
Volume
Price Quote as of

More stories below advertisement

Corus Entertainment Announces Fiscal 2020 Third Quarter Results

PR Newswire - PRF - Fri Jun 26, 5:00AM CDT
  
  • Consolidated revenues declined 24% for the quarter and 9% year-to-date
  • Consolidated segment profit (1)(2) decreased 35% for the quarter and 13% year-to-date
  • Consolidated segment profit margin (1) of 32% for the quarter and 34% year-to-date
  • Net loss attributable to shareholders of $752.3 million ( $3.61 loss per share basic) for the quarter and $655.6 million ( $3.12 loss per share basic) year-to-date, which includes non-cash impairment charges related to broadcast licenses and goodwill of $786.8 million
  • Net debt to segment profit (1) of 3.22 times at May 31, 2020 up from 3.00 times at February 28, 2020
  • Free cash flow (1)(2) of $90.8 million for the quarter and $208.9 million year-to-date
TORONTOJune 26, 2020Corus Entertainment Inc.

"Corus remains focused on our essential role in delivering news, information and entertainment to communities across Canada in the face of the challenges brought on by COVID and its significant impact on our third quarter results," said Doug Murphy , President and Chief Executive Officer.  "I am extremely proud of our team and their extraordinary dedication, at a time when it is critical to keep Canadians connected and informed." 

"In Q3, we saw increased viewership and engagement across all of our platforms, as Canadians rediscovered the power of television and Corus. With the economy materially impacted by the COVID pandemic, these audiences were not optimally monetized as advertising demand is tightly correlated to sales and economic activity," continued Mr. Murphy.  "This week we held our virtual Upfront, revealing a very strong fall schedule which, when coupled with these recent viewing trends, gives us reasons for optimism in the coming year. Notably, our subscriber revenue remained resilient, benefitting from the accelerated uptake of STACKTV. In this unprecedented environment, Corus remains intensely focused and disciplined as we manage the business, advance our strategic priorities and maintain a solid financial position."

Financial Highlights

Three months ended

Nine months ended



May 31,


May 31,

(in thousands of Canadian dollars except per share amounts)

2020

2019

2020

2019

Revenues





Television

331,322

421,481

1,109,116

1,201,137

Radio

17,645

36,936

83,724

108,866


348,967

458,417

1,192,840

1,310,003

Segment profit (loss) (1) (2)





Television

115,838

166,650

409,928

464,912

Radio

(1,776)

9,768

14,828

27,735

Corporate

(2,749)

(5,895)

(13,419)

(17,338)


111,313

170,523

411,337

475,309

Net income (loss) attributable to shareholders

(752,280)

66,378

(655,640)

133,137

Adjusted net income attributable to shareholders (1)

18,996

66,077

124,876

153,077

Basic earnings (loss) per share

($3.61)

$0.31

($3.12)

$0.63

Adjusted basic earnings per share (1)

$0.09

$0.31

$0.59

$0.72

Diluted earnings (loss) per share

($3.61)

$0.31

($3.12)

$0.63

Free cash flow (1)(2)

90,773

90,101

208,894

216,416






(1)

Segment profit (loss), segment profit margin, adjusted net income attributable to shareholders, adjusted basic earnings per share, free cash flow and net debt to segment profit do not have standardized meanings prescribed by International Financial Reporting Standards ("IFRS"). The Company believes these non-IFRS measures are frequently used as key measures to evaluate performance. For definitions, explanations and reconciliations see discussion under the Key Performance Indicators section of the Third Quarter 2020 Report to Shareholders.



(2)

Segment profit (loss) for the three and nine months ended May 31, 2020 was impacted by the adoption of the new accounting standard, IFRS 16 - Leases, effective September 1, 2019. This has resulted in an increase in segment profit for the quarter and year-to-date of approximately $3.3 million and $10.1 million, respectively, and an increase in free cash flow of approximately $4.1 million and $12.1 million, respectively. Further discussion of this can be found in the Impact of New Accounting Policies section of the Third Quarter 2020 Report to Shareholders.

Consolidated Results from Operations

Consolidated revenues for the three months ended May 31, 2020 were $349.0 million , down 24% from $458.4 million last year, and consolidated segment profit was $111.3 million , a decrease of 35% from $170.5 million last year. Net loss attributable to shareholders for the quarter ended May 31, 2020 was $752.3 million ( $3.61 loss per share basic), as compared to net income attributable to shareholders of $66.4 million ( $0.31 per share basic) last year. Net loss attributable to shareholders for the third quarter of fiscal 2020 includes broadcast license and goodwill impairment charges of $786.8 million ( $3.69 per share, net of income taxes) and integration, restructuring and other costs of $2.6 million ( $0.01 per share, net of income taxes). Adjusting for the impact of these items results in an adjusted net income attributable to shareholders of $19.0 million ( $0.09 per share basic) for the quarter. Net income attributable to shareholders for the prior year quarter includes integration, restructuring and other costs of $2.3 million ( $0.01 per share, net of income taxes), a gain on debt modification of $3.9 million ( $0.01 per share, net of income taxes) and a loss on disposal of the Telelatino Network of $0.3 million ($nil per share, net of income taxes). Adjusting for the impact of these items results in an adjusted net income attributable to shareholders of $66.1 million ( $0.31 per share basic) for the prior year quarter.

Consolidated revenues for the nine months ended May 31, 2020 were $1,192.8 million , a decline of 9% from $1,310.0 million last year, and consolidated segment profit was $411.3 million , a decrease of 13% from $475.3 million last year. Net loss attributable to shareholders for the nine months ended May 31, 2020 was $655.6 million ( $3.12 loss per share basic), as compared to a net income attributable to shareholders of $133.1 million ( $0.63 per share basic) last year. Net loss attributable to shareholders for the nine months ended May 31, 2020 includes broadcast license and goodwill impairment charges of $786.8 million ( $3.66 per share, net of income taxes) and integration, restructuring and other costs of $15.2 million ( $0.05 per share, net of income taxes). Adjusting for the impact of these items results in an adjusted net income attributable to shareholders of $124.9 million ( $0.59 per share basic) for the current fiscal year. Net income attributable to shareholders for the nine months ended May 31, 2019 includes integration, restructuring and other costs of $19.5 million ( $0.07 per share, net of income taxes), an impairment of an investment in associates of $8.7 million ( $0.03 per share, net of income taxes), a gain on debt modification of $3.9 million ( $0.01 per share, net of income taxes) and a loss on disposal of the Telelatino Network of $0.3 million ($nil per share, net of income taxes). Adjusting for the impact of these items results in an adjusted net income attributable to shareholders of $153.1 million ( $0.72 per share basic) for the prior fiscal year.

Operational Results - Highlights for Q3 2020

 Television

  • Segment revenues decreased 21% in Q3 2020 and 8% year-to-date
  • Advertising revenues decreased 31% in Q3 2020 and 12% year-to-date
  • Subscriber revenues were flat in Q3 2020 and decreased 1% year-to-date
  • Merchandising, distribution and other revenues decreased $2.6 million (12%) in Q3 2020 and increased $8.3 million (15%) year-to-date
  • Segment profit (1) was down 30% in Q3 2020 and down 12% year-to-date
  • Segment profit margin (1) of 35% in Q3 2020 and 37% year-to-date, compared to segment profit margin of 40% and 39%, respectively, in the prior year
  • Non-cash goodwill impairment charge in Q3 2020 of $673.0 million

Radio

  • Segment revenues decreased $19.3 million (52%) in Q3 2020 and $25.1 million (23%) year-to-date
  • Segment profit (loss) (1) decreased $11.5 million (118%) in Q3 2020 and $12.9 million (47%) year-to-date
  • Segment loss margin (1) of 10% in Q3 2020 and segment profit margin of 18% year-to-date, compared to segment profit margin of 26% and 25%, respectively, in the prior year
  • Non-cash impairment charges in Q3 2020 on broadcast licenses of $67.8 million and goodwill of $46.0 million

(1)

Segment profit (loss), segment profit (loss) margin, free cash flow and net debt to segment profit do not have standardized meanings prescribed by IFRS. The Company reports on these because they are key measures used to evaluate performance. For definitions and explanations, see the discussion under the Key Performance Indicators section of the Third Quarter 2020 Report to Shareholders.

Corporate

  • Free cash flow (1) of $90.8 million in Q3 2020 and $208.9 million year-to-date, compared to $90.1 million and $216.4 million , respectively, in the prior year. The current year benefited from payment deferrals of Canadian income tax installments and sales tax remittances
  • Net debt to segment profit (1) was 3.22 times at May 31, 2020 , up from 2.82 times at August 31, 2019 , due to reduction in segment profit and the implementation of IFRS 16 - Leases that added $151.4 million to the net debt calculation as at May 31, 2020 , offset by bank loan repayments of $43.7 million in the quarter
  • In Q3 an additional 1.15 million shares have been repurchased under the Normal Course Issuer Bid. As at May 31, 2020 , 3.63 million shares have been repurchased since the implementation of the Normal Course Issuer Bid on November 13, 2019
  • Consolidated segment profit margin (1) of 32% in Q3 2020 and 34% year-to-date, compared to 37% and 36%, respectively, in the prior year

(1)

Segment profit (loss), segment profit (loss) margin, free cash flow and net debt to segment profit do not have standardized meanings prescribed by IFRS. The Company reports on these because they are key measures used to evaluate performance. For definitions and explanations, see the discussion under the Key Performance Indicators section of the Third Quarter 2020 Report to Shareholders.

COVID-19 Update

The Company continues to closely monitor the evolution of the novel coronavirus ("COVID-19") situation. As the COVID-19 pandemic continues to significantly impact the wellbeing of individuals and the Canadian and global economies, the Company has implemented a specific response plan, informed by measures recommended by public health agencies, to continue providing its essential services and support to customers while safeguarding the health and safety of employees. Appropriate business continuity measures have been taken to ensure uninterrupted service of the Company's television, digital and radio operations.

Restrictions have gradually begun to lift in many provinces allowing the reopening of various sectors and businesses; however, the Company will not rush to return people to their work sites, as it has continued to operate with more than 70% of its workforce working remotely. The Company has adopted an "ease back" approach to ensure that the health of its people and the communities they work in are protected. Development of company-wide principles and guidelines, informed by public health authorities' recommendations, and site-specific plans are being made to set out the appropriate pace and timing for each region and workplace to return-to-work gradually and safely over the next few months. Site-specific plans may include reduced occupancy at some sites, or modification of workspaces to provide the right level of protection to the Company's employees.

It is too soon to gauge the medium to long-term impacts of the current outbreak, given the many unknowns related to COVID-19. These include the duration, severity and possible resurgence of the outbreak as emergency measures are eased. COVID-19 is altering business and consumer activity in many ways. The global response to the COVID-19 pandemic has resulted in, among other things, border closures, severe travel restrictions, the temporary shut-down of non-essential services and extreme fluctuations in financial and commodity markets. Restrictive measures may be re-implemented by one or more governments in jurisdictions where the Company operates. Labour shortages due to illness, Company or government imposed isolation programs, or restrictions on the movement of personnel or possible supply chain disruptions could result in a reduction or cessation of all or a portion of the Company's operations. The extent to which COVID-19 and any other pandemic or public health crisis impacts the Company's business, affairs, operations, financial condition, liquidity, availability of credit and results of operations will depend on future developments that are highly uncertain and cannot be predicted with any meaningful precision, including new information which may emerge concerning the severity of the COVID-19 virus and the actions required to continue to contain the COVID-19 virus or remedy its impact, among others.

The Company's financial priorities remain unchanged. Importantly the Company remains committed to increasing its financial flexibility over the longer term. In this environment, however, the Company believes it is prudent to conserve cash out of an abundance of caution. The Company is constantly evaluating the situation and monitoring any impacts or potential impacts to its business.

Corus Entertainment Inc. reports its financial results in Canadian dollars.

The unaudited interim condensed consolidated financial statements and accompanying notes for the three and nine months ended May 31, 2020 and Management's Discussion and Analysis are available on the Company's website at www.corusent.com in the Investor Relations section.

A conference call with Corus senior management is scheduled for June 26, 2020 at 8:00 a.m. ET . While this call is directed at analysts and investors, members of the media are welcome to listen in. The dial-in number for the conference call for local and international callers is 1.647.427.7450 and for North America is 1.888.231.8191. More information can be found on the Corus Entertainment website at www.corusent.com in the Investor Relations section.

Use of Non-IFRS Financial Measures

This press release includes the non-IFRS financial measures of adjusted net income attributable to shareholders, adjusted basic earnings per share, free cash flow and net debt to segment profit that are not in accordance with, nor an alternate to, generally accepted accounting principles ("IFRS") and may be different from non-IFRS measures used by other companies. In addition, these non-IFRS measures are not based on any comprehensive set of accounting rules or principles.

Non-IFRS financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with IFRS. They are limited in value because they exclude charges that have a material effect on the Company's reported results and, therefore, should not be relied upon as the sole financial measures to evaluate the Company's financial results. The non-IFRS financial measures are meant to supplement, and to be viewed in conjunction with, IFRS financial results. A reconciliation of the Company's non-IFRS measures is included in the Company's most recent Report to Shareholders which is available on Corus' website at www.corusent.com as well as on SEDAR at www.sedar.com .

Caution Concerning Forward-Looking Information

This press release contains forward-looking information and should be read subject to the following cautionary language:

To the extent any statements made in this report contain information that is not historical, these statements are forward-looking statements and may be forward-looking information within the meaning of applicable securities laws (collectively, "forward-looking information"). These forward-looking statements relate to, among other things, our objectives, goals, strategies, intentions, plans, estimates and outlook, including advertising, distribution, merchandise and subscription revenues, operating costs and tariffs, taxes and fees, and can generally be identified by the use of words such as "believe", "anticipate", "expect", "intend", "plan", "will", "may" and other similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances may be considered forward-looking information. Although Corus believes that the expectations reflected in such forward-looking information are reasonable, such information involves assumptions and risks and uncertainties and undue reliance should not be placed on such statements. Certain material factors or assumptions are applied with respect to the forward-looking information, including without limitation, factors and assumptions regarding the general market conditions and general outlook for the industry, interest rates, stability of the advertising, distribution, merchandise and subscription markets, operating and capital costs and tariffs, taxes and fees, our ability to source desirable content and our capital and operating results being consistent with our expectations. Actual results may differ materially from those expressed or implied in such information. Important factors that could cause actual results to differ materially from these expectations include, among other things: our ability to attract and retain advertising revenues; audience acceptance of our television programs and cable networks; our ability to recoup production costs, the availability of tax credits and the existence of co-production treaties; our ability to compete in any of the industries in which we do business; the opportunities (or lack thereof) that may be presented to and pursued by us; conditions in the entertainment, information and communications industries and technological developments therein; changes in laws or regulations or the interpretation or application of those laws and regulations; our ability to integrate and realize anticipated benefits from our acquisitions and to effectively manage our growth; our ability to successfully defend ourselves against litigation matters arising out of the ordinary course of business; failure to meet covenants under our senior credit facility; epidemics, pandemics or other public health crises, including the current outbreak of novel coronavirus ("COVID-19") and changes in accounting standards. Additional information about these factors and about the material assumptions underlying any forward-looking information may be found under the heading "Risks and Uncertainties" in the Management's Discussion and Analysis for the year ended August 31, 2019 and the third quarter ended May 31, 2020 and under the heading "Risk Factors" in our Annual Information Form. Corus cautions that the foregoing list of important assumptions and factors that may affect future results is not exhaustive. When relying on our forward-looking information to make decisions with respect to Corus, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Unless otherwise specified, all forward-looking information in this document speaks as of the date of this document. Unless otherwise required by applicable securities laws, Corus disclaims any intention or obligation to publicly update or revise any forward-looking information whether as a result of new information, events or circumstances that arise after the date thereof or otherwise.

About Corus Entertainment Inc.

Corus Entertainment Inc. (TSX:CJR-B.TO) is a leading media and content company that develops and delivers high quality brands and content across platforms for audiences around the world. Engaging audiences since 1999, the company's portfolio of multimedia offerings encompass 34 specialty television services, 39 radio stations, 15 conventional television stations, a suite of digital assets, animation software, technology and media services. Corus is an established creator of globally distributed content through Nelvana animation studio, Corus Studios, and children's book publishing house Kids Can Press. The company also owns innovative full-service social digital agency so.da, and lifestyle entertainment company Kin Canada. Corus' roster of premium brands includes Global Television, W Network, HGTV Canada, Food Network Canada, HISTORY®, Showcase, Adult Swim, National Geographic, Disney Channel Canada, YTV, Global News, Globalnews.ca, Q107, Country 105, and CFOX. Visit Corus at www.corusent.com .

CORUS ENTERTAINMENT INC.

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(unaudited - in thousands of Canadian dollars)

As at May 31,

As at August 31,

2020

2019

ASSETS



Current



Cash and cash equivalents

79,632

82,568

Accounts receivable

403,213

372,828

Income taxes recoverable

13,772

Prepaid expenses and other assets

23,525

19,557

Total current assets

506,370

488,725

Tax credits receivable

39,890

25,035

Investments and other assets

70,745

51,707

Property, plant and equipment

341,061

225,927

Program rights

669,403

507,913

Film investments

54,546

53,336

Intangibles

1,815,577

1,876,235

Goodwill

664,958

1,383,958

Deferred income tax assets

63,217

59,463


4,225,767

4,672,299

 

LIABILITIES AND EQUITY



Current



Accounts payable and accrued liabilities

535,836

429,483

Current portion of bank debt

76,339

76,339

Provisions

7,760

10,331

Income taxes payable

3,738

Total current liabilities

623,673

516,153

Bank debt

1,527,811

1,655,406

Other long-term liabilities

571,207

278,117

Provisions

9,168

7,686

Deferred income tax liabilities

447,548

472,700

Total liabilities

3,179,407

2,930,062

 

EQUITY



Share capital

816,189

830,477

Contributed surplus

1,511,065

1,512,818

Accumulated deficit

(1,425,549)

(758,757)

Accumulated other comprehensive income (deficit)

(5,743)

12,187

Total equity attributable to shareholders

895,962

1,596,725

Equity attributable to non-controlling interest

150,398

145,512

Total equity

1,046,360

1,742,237


4,225,767

4,672,299

 

CORUS ENTERTAINMENT INC.

CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)


Three months ended

Nine months ended


May 31,

May 31,

(unaudited - in thousands of Canadian dollars except per share amounts)

2020

2019

2020

2019

Revenues

348,967

458,417

1,192,840

1,310,003

Direct cost of sales, general and administrative expenses

237,654

287,894

781,503

834,694

Depreciation and amortization

39,485

35,899

119,751

145,028

Interest expense

29,378

28,220

87,984

91,405

Broadcast licenses and goodwill impairment

786,790

786,790

Gain on debt modification

(3,889)

(3,889)

Integration, restructuring and other costs

2,636

2,309

15,194

19,537

Other expense, net

10,251

4,171

13,636

11,929

Income (loss) before income taxes

(757,227)

103,813

(612,018)

211,299

Income tax expense (recovery)

(8,947)

30,168

29,479

59,158

Net income (loss) for the period

(748,280)

73,645

(641,497)

152,141






Other comprehensive income (loss), net of income taxes:





Items that may be reclassified subsequently to income (loss):





Unrealized change in fair value of cash flow hedges

(13,663)

(12,905)

(17,871)

(27,651)

Unrealized foreign currency translation adjustment

656

395

834

515


(13,007)

(12,510)

(17,037)

(27,136)

Items that will not be reclassified to income (loss):





Unrealized change in fair value of financial assets

(7,458)

(1,735)

(893)

(1,639)

Actuarial gain (loss) on post-retirement benefit plans

21,750

(9,766)

14,035

(10,942)


14,292

(11,501)

13,142

(12,581)

Other comprehensive income (loss), net of income taxes

1,285

(24,011)

(3,895)

(39,717)

Comprehensive income (loss) for the period

(746,995)

49,634

(645,392)

112,424

Net income (loss) attributable to:





Shareholders

(752,280)

66,378

(655,640)

133,137

Non-controlling interest

4,000

7,267

14,143

19,004


(748,280)

73,645

(641,497)

152,141

Comprehensive income (loss) attributable to:





Shareholders

(750,995)

42,367

(659,535)

93,420

Non-controlling interest

4,000

7,267

14,143

19,004


(746,995)

49,634

(645,392)

112,424

Earnings (loss) per share attributable to shareholders:





Basic

($3.61)

$0.31

($3.12)

$0.63

Diluted

($3.61)

$0.31

($3.12)

$0.63

 

CORUS ENTERTAINMENT INC.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY


(unaudited - in thousands of Canadian dollars)

Share capital

Contributed

surplus

Accumulated

deficit

Accumulated other
comprehensive income (loss)

Total equity
 attributable
to shareholders

Non-
controlling
interest

Total equity

As at August 31, 2019

830,477

1,512,818

(758,757)

12,187

1,596,725

145,512

1,742,237

Comprehensive income (loss)

(655,640)

(3,895)

(659,535)

14,143

(645,392)

Dividends declared

(25,187)

(25,187)

(14,668)

(39,855)

Share repurchase under normal course issuer bid ("NCIB")

 

(14,288)

 

(2,605)

 

 

 

(16,893)

 

 

(16,893)

Actuarial gain on post- retirement benefit plans

 

 

 

14,035

 

(14,035)

 

 

 

Share-based compensation expense

 

 

852

 

 

 

852

 

 

852

Equity funding

5,411

5,411

As at May 31, 2020

816,189

1,511,065

(1,425,549)

(5,743)

895,962

150,398

1,046,360









(unaudited - in thousands of Canadian dollars)

 

Share capital

 

Contributed

surplus

 

Accumulated

deficit

Accumulated other
comprehensive

income

Total equity
 attributable
to
shareholders

Non-
controlling interest

Total equity

As at August 31, 2018, as previously presented

 

2,330,477

 

12,119

 

(856,668)

 

36,460

 

1,522,388

 

154,415

 

1,676,803

IFRS 9 transitional adjustment

9,396

9,396

9,396

IFRS 15 transitional adjustment

1,985

1,985

1,985

Adjusted balance as at September 1, 2018

 

2,330,477

 

12,119

 

(854,683)

 

45,856

 

1,533,769

 

154,415

 

1,688,184

Comprehensive income (loss)

133,137

(39,717)

93,420

19,004

112,424

Dividends declared

(38,147)

(38,147)

(21,409)

(59,556)

Reduction of stated capital

(1,500,000)

1,500,000

Actuarial loss on post-retirement benefit plans

 

 

 

(10,942)

 

10,942

 

 

 

Share-based compensation expense

 

 

485

 

 

 

485

 

 

485

Divestiture of subsidiary with a non-controlling equity interest

 

 

 

 

 

 

(5,120)

 

(5,120)

As at May 31, 2019

830,477

1,512,604

(770,635)

17,081

1,589,527

146,890

1,736,417

 

CORUS ENTERTAINMENT INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS


Three months ended

Nine months ended


May 31,

May 31,

(unaudited - in thousands of Canadian dollars)

2020

2019

2020

2019

OPERATING ACTIVITIES





Net income (loss) for the period

(748,280)

73,645

(641,497)

152,141

Adjustments to reconcile net income (loss) to cash flow from operations:





Amortization of program rights

130,661

137,002

386,224

394,130

Amortization of film investments

3,333

6,059

14,414

12,444

Depreciation and amortization

39,485

35,899

119,751

145,028

Broadcast licenses and goodwill impairment

786,790

786,790

Deferred income tax expense (recovery)

(21,529)

821

(27,607)

(19,126)

Impairment of investment in associate

8,720

Share-based compensation expense

291

238

852

485

Imputed interest

13,564

10,325

39,802

31,990

Gain on debt modification

(3,889)

(3,889)

Payment of program rights

(138,195)

(157,264)

(405,196)

(394,068)

Net spend on film investments

(12,527)

(14,847)

(46,007)

(43,232)

CRTC benefit payments

(312)

(312)

(1,045)

(1,223)

Other

(2,553)

(2,893)

(5,761)

(6,701)

Cash flow from operations

50,728

84,784

220,720

276,699

Net change in non-cash working capital balances related to operations

45,131

12,039

(1,646)

(48,185)

Cash provided by operating activities

95,859

96,823

219,074

228,514

INVESTING ACTIVITIES





Additions to property, plant and equipment

(3,801)

(5,418)

(10,091)

(11,578)

Proceeds from sale of property

249

288

Business divestiture, net of divested cash

12,529

12,529

Business acquisition

(6,011)

(6,011)

Net cash flows for intangibles, investments and other assets

(2,237)

(1,156)

(2,207)

(3,670)

Cash used in investing activities

(5,789)

(56)

(12,010)

(8,730)

FINANCING ACTIVITIES





Decrease in bank loans

(43,691)

(72,425)

(130,660)

(189,973)

Deferred financing costs

(3,342)

(3,342)

Shares repurchased under NCIB

(3,930)

(16,893)

Payments of lease liabilities

(4,058)

(12,105)

Equity funding by a non-controlling interest

5,411

Dividends paid

(12,535)

(12,715)

(37,901)

(25,432)

Dividends paid to non-controlling interest

(4,007)

(6,245)

(14,668)

(23,408)

Other

(675)

(469)

(3,184)

(3,209)

Cash used in financing activities

(68,896)

(95,196)

(210,000)

(245,364)

Net change in cash and cash equivalents during the period

21,174

1,571

(2,936)

(25,580)

Cash and cash equivalents, beginning of the period

58,458

67,650

82,568

94,801

Cash and cash equivalents, end of the period

79,632

69,221

79,632

69,221

 

CORUS ENTERTAINMENT INC.

BUSINESS SEGMENT INFORMATION

(unaudited - in thousands of Canadian dollars)

Three months ended May 31, 2020


Television

Radio

Corporate

Consolidated

Revenues

331,322

17,645

348,967

Direct cost of sales, general and administrative expenses

215,484

19,421

2,749

237,654

Segment profit (loss) (1)(2)

115,838

(1,776)

(2,749)

111,313

Depreciation and amortization




39,485

Interest expense




29,378

Broadcast licenses and goodwill impairment




786,790

Integration, restructuring and other costs




2,636

Other expense, net




10,251

Loss before income taxes




(757,227)

 

Three months ended May 31, 2019






Television

Radio

Corporate

Consolidated

Revenues

421,481

36,936

458,417

Direct cost of sales, general and administrative expenses

254,831

27,168

5,895

287,894

Segment profit (loss) (1)

166,650

9,768

(5,895)

170,523

Depreciation and amortization




35,899

Interest expense




28,220

Gain on debt modification




(3,889)

Integration, restructuring and other costs




2,309

Other expense, net




4,171

Income before income taxes




103,813

 

Nine months ended May 31, 2020






Television

Radio

Corporate

Consolidated

Revenues

1,109,116

83,724

1,192,840

Direct cost of sales, general and administrative expenses

699,188

68,896

13,419

781,503

Segment profit (loss) (1)(2)

409,928

14,828

(13,419)

411,337

Depreciation and amortization




119,751

Interest expense




87,984

Broadcast licenses and goodwill impairment




786,790

Integration, restructuring and other costs




15,194

Other expense, net




13,636

Loss before income taxes




(612,018)

(1)

Segment profit (loss) does not have a standardized meaning prescribed by IFRS.  For definitions and explanations, see discussion under   the Key Performance Indicators section of the Third Quarter 2020 Report to Shareholders.

(2)

Segment profit (loss) for the three and nine months ended May 31, 2020 was impacted by the adoption of the new accounting standard,  IFRS 16 – Leases, effective September 1, 2019.  This has resulted in an increase in segment profit for the quarter and year-to-date of approximately $3.3 million and $10.1 million, respectively.  Further discussion of this can be found in the Impact of New Accounting Policies section of the Third Quarter 2020 Report to Shareholders.

 

(unaudited - in thousands of Canadian dollars)





Nine months ended May 31, 2019






Television

Radio

Corporate

Consolidated

Revenues

1,201,137

108,866

1,310,003

Direct cost of sales, general and administrative expenses

736,225

81,131

17,338

834,694

Segment profit (loss) (1)

464,912

27,735

(17,338)

475,309

Depreciation and amortization




145,028

Interest expense




91,405

Gain on debt modification




(3,889)

Integration, restructuring and other costs




19,537

Other expense, net




11,929

Income before income taxes




211,299

(1)

Segment profit (loss) does not have a standardized meaning prescribed by IFRS.  For definitions and explanations, see discussion under the Key Performance Indicators section of the Third Quarter 2020 Report to Shareholders.

 

REVENUES BY TYPE


Three months ended 

Nine months ended


May 31,

May 31,

(unaudited - in thousands of Canadian dollars)

2020

2019

2020

2019

Advertising

207,862

314,162

756,131

875,781

Subscriber fees

121,500

121,096

368,919

373,419

Merchandising, distribution and other

19,605

23,159

67,790

60,803


348,967

458,417

1,192,840

1,310,003

 

NON-IFRS FINANCIAL MEASURES


(unaudited - in thousands of Canadian dollars, except per share amounts)  

Three months ended

Nine months ended


May 31,

May 31,

Adjusted Net Income Attributable to Shareholders

2020

2019

2020

2019

Net income (loss) attributable to shareholders

(752,280)

66,378

(655,640)

133,137

Adjustments, net of income tax:





Impairment of investment in associates

7,565

Broadcast licences and goodwill impairment

769,338

769,338

Gain on debt modification

(2,856)

(2,856)

Loss from disposition of the Telelatino Network

814

814

Integration, restructuring and other costs

1,938

1,741

11,178

14,417

Adjusted net income attributable to shareholders

18,996

66,077

124,876

153,077

Basic earnings (loss) per share

($3.61)

$0.31

($3.12)

$0.63

Adjustments, net of income tax:





Impairment of investment in associates

$0.03

Broadcast licences and goodwill impairment

$3.69

$3.66

Gain on debt modification

($0.01)

($0.01)

Loss from disposition of the Telelatino Network

Integration, restructuring and other costs

$0.01

$0.01

$0.05

$0.07

Adjusted basic earnings per share

$0.09

$0.31

$0.59

$0.72

                                                                                                                                


Three months ended

Nine months ended

(unaudited - in thousands of Canadian dollars)  

May 31,  

May 31,

Free Cash Flow

2020

2019

2020

2019

Cash provided by (used in):





Operating activities (1)

95,859

96,823

219,074

228,514

Investing activities

(5,789)

(56)

(12,010)

(8,730)

 

Add: cash used in business acquisitions, strategic investments and non-controlling interest (2)

90,070

96,767

207,064

219,784

703

5,863

1,830

9,161

Deduct: cash provided by business divestiture, net of divested cash (2)

(12,529)

(12,529)

Free cash flow

90,773

90,101

208,894

216,416

(1)  

Free cash flow for the three and nine months ended May 31, 2020 was impacted by the adoption of IFRS 16, effective September 1, 2019. This has resulted in an increase in free cash flow of approximately $4.1 million for the quarter and $12.1 million for the year-to-date. Further discussion of this can be found in the Impact of New Accounting Policies section of the Third Quarter 2020 Report to Shareholders.

(2)

Strategic investments are comprised of investments in venture funds and associated companies.

                                                                                                                             


Nine months ended

(unaudited - in thousands of Canadian dollars) 

May 31, 

August 31,

Net Debt and Net Debt to Segment Profit

2020

2019

Total bank loans, net of unamortized financing fees

1,604,150

1,731,745

Lease liabilities

151,399

Cash and cash equivalents

(79,632)

(82,568)

Net debt

1,675,917

1,649,177

Segment profit (denominator) (1)

521,113

585,085

Net debt to segment profit

3.22

2.82

(1)  

Reflects aggregate amounts for the most recent four quarters, as detailed in the table in the "Quarterly Consolidated Financial Information" section of the Third Quarter 2020 Report to Shareholders. Effective September 1, 2019, the Company adopted IFRS 16. There has been no restatement of segment profit for those quarters prior to fiscal 2020. Refer to Impact of New Accounting Policies section of the Third Quarter 2020 Report to Shareholders for more information.

 

Cision View original content: http://www.prnewswire.com/news-releases/corus-entertainment-announces-fiscal-2020-third-quarter-results-301084272.html

SOURCE Corus Entertainment Inc.

comtex tracking

More stories below advertisement

All market data (will open in new tab) is provided by Barchart Solutions. Copyright © 2020.

Information is provided 'as is' and solely for informational purposes, not for trading purposes or advice. For exchange delays and terms of use, please read disclaimer (will open in new tab).

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies