Glacier Media Inc. (TSX: GVC) (“Glacier” or the “Company”) reported
revenue and earnings for the period ended September 30, 2023.
SUMMARY RESULTS
(thousands of dollars) |
Three months ended September 30, |
|
Nine months ended September 30, |
except share and per share amounts |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
42,686 |
|
|
$ |
47,920 |
|
|
$ |
119,226 |
|
|
$ |
133,287 |
|
EBITDA |
|
$ |
1,284 |
|
|
$ |
1,837 |
|
|
$ |
(4,194 |
) |
|
$ |
4,713 |
|
EBITDA margin |
|
|
3.0 |
% |
|
|
3.8 |
% |
|
|
(3.5 |
%) |
|
|
3.5 |
% |
EBITDA per share |
|
$ |
0.01 |
|
|
$ |
0.01 |
|
|
$ |
(0.03 |
) |
|
$ |
0.04 |
|
Capital expenditures |
|
$ |
976 |
|
|
$ |
1,486 |
|
|
$ |
3,195 |
|
|
$ |
3,618 |
|
Net loss attributable to common shareholder |
|
$ |
(4,205 |
) |
|
$ |
(748 |
) |
|
$ |
(17,608 |
) |
|
$ |
(3,800 |
) |
Net loss attributable to common shareholder per share |
|
$ |
(0.03 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.13 |
) |
|
$ |
(0.03 |
) |
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding, net |
|
|
131,143,598 |
|
|
|
132,503,804 |
|
|
|
131,221,073 |
|
|
|
132,612,573 |
|
|
|
|
|
|
|
|
|
|
(1) EBITDA is considered a non-GAAP measure. Refer to
“EBITDA Reconciliation” below for a reconciliation of the Company’s
net (loss) income attributable to common shareholders as reported
under IFRS to EBITDA.
2023 OPERATING PERFORMANCE AND OUTLOOK
Operating Performance
Consolidated revenue for the three months ended
September 30, 2023, was $42.7 million, down $5.2 million or 10.9%
from the same period in the prior year. Consolidated EBITDA for the
quarter was $1.3 million, down $0.1 million as compared to the same
quarter in the prior year. During Q1 2023, the Company completed
two separate transactions that resulted in three operations being
accounted for as joint ventures, compared to previously included in
the consolidated results. The Company completed the sale of its
printing assets into two new joint venture operations. Certain
print community media operations were treated as joint ventures
from January 1, 2023, as the result of changes made in the
structure of the underlying shareholders agreements with the
previous minority shareholders, and it was determined that Company
no longer has the ability to exercise control and therefore can no
longer treat these entities as subsidiaries. These transactions had
the effect of reducing reported revenue and EBITDA as compared to
the same period in the prior year and increasing equity earnings in
the current period as compared to the same period in the prior
year. During the third quarter, the Company implemented the closure
of certain print community media publications. Additional print
publication closures have subsequently been announced and were
implemented in the fourth quarter.
Organic revenue declines in print media were
driven by lower demand for print media products. The environmental
and property information operations had small revenue growth
despite being reliant on the commercial and residential real estate
industry, which is being affected by higher interest rates
temporarily decreasing demand for real estate related products. The
agricultural information operations noted increased revenue in
digital products and events as both outdoor agricultural exhibition
shows are held in the third quarter, this was partially offset by
declines in print related revenue, resulting from the industry
consolidation of advertisers and the declining demand for print
products overall. The mining information operations continue to
operate in a challenged industry, especially with respect to junior
miners, which is resulting in lower advertising revenue.
EBITDA for the period decreased as the result of
lower revenues in the operations as discussed above. Additionally,
rising costs related to inflation, (e.g. increased employee costs,
newsprint, and printing costs) compounded the effects of reduced
revenue and increased legal costs. This was partially offset by the
effects of cost reduction measures that were put in place earlier
in 2023, including lower investment spending, and targeted print
publication closures having a positive effect on results
overall.
Outlook
Despite the challenging environment, the Company
continues to focus on a combination of generating long-term revenue
gains in its growth businesses and cost management in its legacy
businesses. Operational investments in key strategic development
areas continue to be scaled back until the economic outlook becomes
more certain. The Company is monitoring economic conditions and
will respond accordingly.
The Company is taking action to reduce print
operations where print products are no longer economically
feasible. This transition has already been completed in a number of
markets resulting in the closure of the related print publications.
The targeted closure of print operations will continue to occur and
allow the Company to focus on the transformation to digital
products.
Higher interest rates continue to impact
results. Softness in the residential and commercial real estate
markets continued to negatively affect operations during the third
quarter, though Q3 saw a marked improvement over the first half of
2023. It is expected that industry specific softness will continue
through to the end of 2023 with overall economic uncertainty,
inflation, and the impact of higher interest rates. Although
uncertain, it is anticipated that the pressures from increased
interest rates will begin to stabilize in 2024.
Long-term, the digital media, data, and
information businesses offer growth potential for the future. The
underlying fundamentals of these products have demonstrated their
value in the face of the challenging market conditions.
Even with the challenging economic environment,
some of the Company’s operations continue to perform well. The
Company is optimistic that many of its operations can and will
continue to perform well in the long-term and will continue to
generate strong cash flows and enhance shareholder value. The
respective brands, market positions and value to customers have
remained strong. The Company continues to focus on the long-term
growth of its data and information and digital media operations.
The targeted closure of print publications which are no longer
economically feasible will help the transition to digital and
support the long-term growth therein. Strategic investment spending
in the core areas of focus has resulted in lower operating profits
in the short term, with the goal of improved and more robust
product offerings over time. This investment spending has become
more targeted to strictly necessary spending and will continue to
be scaled back until economic recovery is more certain. The Company
has implemented and will continue to proactively implement cost
cutting measures that will take effect throughout to the end of
2023 and into 2024.
The Company is working to reach the point where
increases in the revenue, profit and cash flow from its data,
analytics and intelligence products and digital media products
exceeds the decline of its print advertising related profit and
cash flow.
Financial Position. As at
September 30, 2023, the Company had a cash balance of $12.7 million
and $7.2 million of non-recourse mortgages and loans (the majority
of which relates to farm show land in Saskatchewan and
Ontario).
The Company has net $5.4 million of deferred
purchase price obligations to be paid over the next two years. This
amount is net of contributions from minority partners.
For further information please contact Mr. Orest
Smysnuik, Chief Financial Officer, at 604-708-3264.
ABOUT THE COMPANY
Glacier Media Inc. is an information &
marketing solutions company pursuing growth in sectors where the
provision of essential information and related services provides
high customer utility and value. The Company’s products and
services are focused in two areas: 1) data, analytics and
intelligence; and 2) content & marketing solutions.
FORWARD LOOKING STATEMENTS
This news release contains forward-looking
statements that relate to, among other things, the Company’s
objectives, goals, strategies, intentions, plans, beliefs,
expectations, and estimates. These forward-looking statements
include, among other things, statements relating to our
expectations as to investment spending and in targeted key
strategic areas and the scaling back of such spending; the expected
effects of cost cutting measures and targeted closure of print
publications; the expected industry specific softness in 2023; our
expectations as to timing of easing of interest rate increases; and
pressures from increased interest rates will begin to stabilize in
2024.. These forward-looking statements are based on certain
assumptions, including continued economic growth and recovery and
the realization of cost savings in a timely manner and in the
expected amounts, which are subject to risks, uncertainties and
other factors which may cause results, performance or achievements
of the Company to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking statements, and undue reliance should not be placed
on such statements.
Important factors that could cause actual
results to differ materially from these expectations include
failure to implement or achieve the intended results from our
strategic initiatives, the failure to reduce debt and the other
risk factors listed in our Annual Information Form under the
heading “Risk Factors” and in our MD&A under the heading
“Business Environment and Risks”, many of which are out of our
control. These other risk factors include, but are not limited to
that future cash flow from operations and the availability under
existing banking arrangements are believed to be adequate to
support financial liabilities and that the Company expects to be
successful in its objection with CRA, the ability of the Company to
sell advertising and subscriptions related to its publications,
foreign exchange rate fluctuations, the seasonal and cyclical
nature of the agricultural and energy sectors, discontinuation of
government grants, general market conditions in both Canada and the
United States, changes in the prices of purchased supplies
including newsprint, the effects of competition in the Company’s
markets, dependence on key personnel, integration of newly acquired
businesses, technological changes, tax risk, financing risk, debt
service risk and cybersecurity risk.
The forward-looking statements made in this news
release relate only to events or information as of the date on
which the statements are made. Except as required by law, the
Company undertakes no obligation to update or revise publicly any
forward-looking statements, whether as a result of new information,
future events or otherwise, after the date on which the statements
are made or to reflect the occurrence of unanticipated events.
NON-IFRS FINANCIAL MEASURES
Earnings before interest, taxes, depreciation
and amortization (“EBITDA”), EBITDA margin and EBITDA per share,
are not generally accepted measures of financial performance under
IFRS. Management utilizes EBITDA as a financial performance measure
to assess profitability and return on equity in its decision
making. In addition, the Company, its lenders and its investors use
EBITDA to measure performance and value for various purposes.
Investors are cautioned; however, that EBITDA should not be
construed as an alternative to net income (loss) attributable to
common shareholders determined in accordance with IFRS as an
indicator of the Company’s performance.
The Company’s method of calculating these
financial performance measures may differ from other companies and,
accordingly, they may not be comparable to measures used by other
companies. A quantitative reconciliation of these non-IFRS measures
is included in the section entitled EBITDA Reconciliation.
EBITDA RECONCILIATION
(thousands of dollars) |
|
Three months ended September 30, |
|
Nine months ended September 30, |
except share and per share amounts |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
Net loss attributable to common shareholders |
|
$ |
(4,205 |
) |
|
$ |
(748 |
) |
|
$ |
(17,608 |
) |
|
$ |
(3,800 |
) |
Add (deduct): |
|
|
|
|
|
|
|
|
Non-controlling interests |
|
$ |
624 |
|
|
$ |
476 |
|
|
$ |
(2,650 |
) |
|
$ |
2,232 |
|
Net interest expense, debt and lease liability |
|
$ |
408 |
|
|
$ |
389 |
|
|
$ |
1,083 |
|
|
$ |
1,212 |
|
Depreciation and amortization |
|
$ |
3,053 |
|
|
$ |
3,160 |
|
|
$ |
8,882 |
|
|
$ |
9,380 |
|
Loss on disposal |
|
$ |
- |
|
|
$ |
- |
|
|
$ |
6,169 |
|
|
$ |
- |
|
Restructuring and other expenses (income) (net) |
|
$ |
2,776 |
|
|
$ |
(640 |
) |
|
$ |
5,536 |
|
|
$ |
(980 |
) |
Share of losses (earnings) |
|
|
|
|
|
|
|
|
from joint ventures and associates |
|
$ |
(141 |
) |
|
$ |
(238 |
) |
|
$ |
392 |
|
|
$ |
(1,063 |
) |
Income tax recovery |
|
$ |
(1,231 |
) |
|
$ |
(562 |
) |
|
$ |
(5,998 |
) |
|
$ |
(2,268 |
) |
EBITDA (1) |
|
$ |
1,284 |
|
|
$ |
1,837 |
|
|
$ |
(4,194 |
) |
|
$ |
4,713 |
|
Notes: |
|
|
|
|
|
|
|
|
(1) Refer to "Non-IFRS Measures" section of MD&A for discussion
of non-IFRS measures used in this table. |
|
|
|
|
|
|
|
|
|
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