TVA Group Reports $6.3 Million Net Income Attributable to Shareholders in Quarter Ended September 30, 2013

TVA Group Reports $6.3 Million Net Income Attributable to Shareholders in 
Quarter Ended September 30, 2013 
MONTREAL, CANADA -- (Marketwired) -- 11/05/13 -- TVA Group Inc. (the
"Corporation") (TSX:TVA.B) announces that it recorded net income
attributable to shareholders in the amount of $6.3 million, or $0.27
per share, in the third quarter of 2013, compared with $1.5 million,
or $0.06 per share, in the same quarter of 2012. 
Third quarter operating highlights: 


 
--  Consolidated operating income(1)increased $8,060,000 (+77.9%) to
    $18,401,000. 
--  The Television segment generated $14,658,000 in operating income, a
    $6,607,000 (+82.1%) increase mainly due to: 
    --  recognition of $6,841,000 in retroactive royalties for distant
        signal retransmission for the years 2009 to 2012 and the first two
        quarters of 2013; 
    --  improved operating results at the specialty services, particularly
        "addikTV," "CASA" and "TVA Sports"; 
--  Partially offset by: 
    --  decrease in operating income from commercial production due to lower
        volume. 
--  The Publishing segment generated $3,743,000 in operating income, a
    $1,453,000 increase mainly due to: 
    --  positive impact of the inclusion of the operating results of La
        Semaine magazine since July 18, 2013; 
    --  cost reductions yielded by the cost-containment plan introduced in
        the second quarter of 2013; and 
    --  contribution from increased volume at TVA Studio during the quarter.

 
"In addition to the retroactive royalties on distant signal
retransmission, the results of the last quarter also showed an
improvement in operating income," commented Pierre Dion, President
and CEO of the Corporation. "This performance would not have been
possible without the operational savings yielded by, among other
things, the investments we have made in recent years in equipment and
technological infrastructure. In the Television segment, TVA
Network's advertising revenues decreased by 7.9% during the last
quarter while the specialty services continued their strong
performance with 6.6% growth in advertising revenues and 9.8% growth
in subscription revenues. 
"The Publishing segment registered remarkable operating income growth
from the same quarter of 2012. The i
nclusion of the operating results
of La Semaine magazine, acquired on July 18, 2013, contributed
significantly to this growth as did the cost reductions TVA
Publications has achieved since the second quarter of 2013. The
integration of our new acquisition's operations into TVA
Publications' existing business will continue during the fourth
quarter. Excluding the acquisition, newsstand revenues decreased by
3.6% and advertising revenues by 5.6% in the third quarter. The
decreases were less than those registered in the first two quarters
of 2013. These results reflect our efforts since the beginning of the
year to improve our products and marketing," said M. Pierre Dion. 


 
(1) See definition of operating income (loss) below.

 
Cash flows provided by operating activities totalled $13.0 million in
the third quarter of 2013, compared with $18.3 million in the same
quarter of 2012. The $5.3 million decrease was essentially due to an
unfavourable net change in non-cash items, including accounts
receivable, programs, broadcast and distribution rights, and
inventories, partially offset by an improvement in operating income. 
Definition 
Operating income (loss) 
In its analysis of operating results, the Corporation defines
operating income (loss) as net income (loss) before amortization of
property, plant and equipment and intangible assets, financial
expenses, operational restructuring costs, impairment of assets and
other costs, impairment of goodwill, gain on disposal of investments,
tax expense, share of loss (income) of associated corporations and
joint ventures, and net loss attributable to non-controlling
interest. Operating income (loss) as defined above is not a measure
of results that is consistent with International Financial Reporting
Standards ("IFRS"). Neither is it intended to be regarded as an
alternative to other financial performance measures or to the
statement of cash flows as a measure of liquidity. This measure is
not intended to represent funds available for debt service, dividend
payment, reinvestment or other discretionary uses, and should not be
considered in isolation or as a substitute for other performance
measures prepared in accordance with IFRS. Operating income (loss) is
used by the Corporation because management believes it is a
meaningful measure of performance. 
This measure is used by management and the Board of Directors to
evaluate the Corporation's consolidated results and the results of
its business sectors. Measurements such as operating income (loss)
are also commonly used by the investment community to analyze and
compare the performance of companies in the industries in which the
Corporation is active. The Corporation's definition of operating
income (loss) may not be identical to similarly titled measures
reported by other companies. 
Forward-looking Information Disclaimer 
The statements in this news release that are not historical facts may
be forward-looking statements and are subject to important known and
unknown risks, uncertainties and assumptions which could cause the
Corporation's actual results for future periods to differ materially
from those set forth in the forward-looking statements.
Forward-looking statements generally can be identified by the use of
the conditional, the use of forward-looking terminology such as
"propose," "will," "expect," "may," "anticipate," "intend,"
"estimate," "plan," "foresee," "believe" or the negative of these
terms or variations of them or similar terminology. Certain factors
that may cause actual results to differ from current expectations
include seasonality, operational risks (including pricing actions by
competitors), programming, content and production cost risks, credit
risk, government regulation risks, government assistance risks,
changes in economic conditions, fragmentation of the media landscape,
and labour relation risks. Investors and others are cautioned that
the foregoing list of factors that may affect future results is not
exhaustive and that undue reliance should not be placed on any
forward-looking statements. For more information on the risks,
uncertainties and assumptions that could cause the Corporation's
actual results to differ from current expectations please refer to
the Corporation's public filings available at www.sedar.com and
http://groupetva.ca including, in particular, the "Risks and
Uncertainties" section of the Corporation's annual Management's
Discussion and Analysis for the year ended December 31, 2012. 
The forward-looking statements in this news release reflect the
Corporation's expectations as of November 5, 2013, and are subject to
change after this date. The Corporation expressly disclaims any
obligation or intention to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise, unless required by the applicable securities laws. 
TVA Group 
TVA Group Inc., a subsidiary of Quebecor Media Inc., is an integrated
communications company involved in the creation, production,
broadcast and distribution of audiovisual products, and in magazine
publishing. TVA Group Inc. is the largest broadcaster of
French-language entertainment, information and public affairs
programming and publisher of French-la
nguage magazines in North
America, and one of the largest private-sector producers of
French-language content in North America. The Corporation's Class B
shares are listed on the Toronto Stock Exchange under the ticker
symbol TVA.B. 


 
TVA GROUP INC.                                                              
Consolidated Statements of Income (Loss)                                    
                                                                            
(unaudited)                                                                 
(in thousands of dollars, except per share amounts)                         
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                  Three-month periods    Nine-month periods 
                                   ended September 30    ended September 30 
----------------------------------------------------------------------------
                                    2013         2012      2013        2012 
                                           (restated,            (restated, 
                          Note                note 2)               note 2) 
----------------------------------------------------------------------------
                                                                            
Revenues                     3 $ 102,217 $     97,171 $ 324,794 $   326,143 
                                                                            
Purchases of goods and                                                      
 services                    4    52,051       52,188   183,966     191,505 
Employee costs                    31,765       34,642   100,592     112,781 
Amortization of property,                                                   
 plant and equipment and                                                    
 intangible assets                 5,494        4,913    15,956      15,372 
Financial expenses           5     1,588        1,673     4,789       5,555 
Operational restructuring                                                   
 costs, impairment of                                                       
 assets and other costs      6       875            -     3,874         117 
Impairment of goodwill       7         -            -         -      32,200 
Gain on disposal of                                                         
 investments                 8         -            -         -     (12,881)
----------------------------------------------------------------------------
Income (loss) before tax                                                    
 expense and share of                                                       
 income of associated                                                       
 corporations andjoint                                                      
 ventures                         10,444        3,755    15,617     (18,506)
----------------------------------------------------------------------------
Tax expense                        2,444          356     3,546       1,392 
Share of loss (income) of                                                   
 associated corporations                                                    
 and joint ventures                1,675        1,860     4,653        (182)
----------------------------------------------------------------------------
Net income (loss)              $   6,325 $      1,539 $   7,418 $   (19,716)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Net income (loss)                                                           
 attributable to:                                                           
  Shareholders                 $   6,325 $      1,539 $   7,418 $   (15,302)
  Non-controlling                                                           
   interest                            -            -         -      (4,414)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Basic and diluted                                                           
 earnings (loss) per                                                        
 share attributable to                                                      
 shareholders             10 c)$    0.27 $       0.06 $    0.31 $     (0.64)
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
See accompanying notes to condensed consolidated financial
statements. 


 
TVA GROUP INC.                                                              
Consolidated Statements of Comprehensive Income (Loss)                      
                                                                            
(unaudited) (in thousands of dollars)                                       
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                               Three-month periods       Nine-month periods 
                                ended September 30       ended September 30 
----------------------------------------------------------------------------
                                2013          2012       2013          2012 
                                        (restated,               (restated, 
                                           note 2)                  note 2) 
----------------------------------------------------------------------------
                                                                            
Net income (loss)         $    6,325  $      1,539 $    7,418  $    (19,716)
                                                                            
Other comprehensive items                                                   
 that will not be                                                           
 reclassified to income:                                                    
Defined benefit plans:                                                      
  Actuarial gain              24,000             -     24,000             - 
  Deferred income taxes       (6,500)            -     (6,500)            - 
----------------------------------------------------------------------------
                              17,500             -     17,500             - 
                                                                            
----------------------------------------------------------------------------
Comprehensive income                                                        
 (loss)                   $   23,825  $      1,539 $   24,918  $    (19,716)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Comprehensive income                                                        
 (loss) a
ttributable to:                                                    
  Shareholders            $   23,825  $      1,539 $   24,918  $    (15,302)
  Non-controlling                                                           
   interest                        -             -          -        (4,414)
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
See accompanying notes to condensed consolidated financial
statements. 


 
TVA GROUP INC.                                                              
Consolidated Statements of Equity                                           
                                                                            
(unaudited)                                                                 
(in thousands of dollars)                                                   
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                        Equity attributable to shareholders 
                       -----------------------------------------------------
                                                                  Accumula- 
                                                                  ted other 
                                                                 comprehen- 
                                                                       sive 
                                                                       loss 
                           Capital                                 -Defined 
                       stock (note  Contributed     Retained        benefit 
                               10)      surplus     earnings          plans 
----------------------------------------------------------------------------
                                                                            
Balance as at                                                               
 December 31, 2011,                                                         
 as previously                                                              
 reported             $     98,647 $          - $    176,993   $          - 
Changes in accounting                                                       
 policies (note 2)               -            -       17,408        (18,323)
----------------------------------------------------------------------------
Balance as at                                                               
 December 31, 2011,                                                         
 as restated                98,647            -      194,401        (18,323)
Net loss                         -            -      (15,302)             - 
Contributions related                                                       
 to non-controlling                                                         
 interest (note 12)              -            -            -              - 
Disposal of interest                                                        
 in SUN News (note                                                          
 12)                             -          581            -              - 
----------------------------------------------------------------------------
Balance as at                                                               
 September 30, 2012         98,647          581      179,099        (18,323)
Net income                       -            -        8,838              - 
Other comprehensive                                                         
 loss                            -            -            -         (2,297)
----------------------------------------------------------------------------
Balance as at                                                               
 December 31, 2012          98,647          581      187,937        (20,620)
Net income                       -            -        7,418              - 
Other comprehensive                                                         
 income                          -            -            -         17,500 
----------------------------------------------------------------------------
Balance as at                                                               
 September 30, 2013   $     98,647 $        581 $    195,355   $     (3,120)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
---------------------------------------------------
---------------------------------------------------
                                                   
                                                   
                             Equity                
                       attributable                
                            to non-                
                        controlling                
                           interest   Total equity 
---------------------------------------------------
                                                   
Balance as at                                      
 December 31, 2011,                                
 as previously                                     
 reported             $       5,389  $     281,029 
Changes in accounting                              
 policies (note 2)                -           (915)
---------------------------------------------------
Balance as at                                      
 December 31, 2011,                                
 as restated                  5,389        280,114 
Net loss                     (4,414)       (19,716)
Contributions related                              
 to non-controlling                                
 interest (note 12)           3,528          3,528 
Disposal of interest                               
 in SUN News (note                                 
 12)                         (4,503)        (3,922)
---------------------------------------------------
Balance as at                                      
 September 30, 2012               -        260,004 
Net income                        -          8,838 
Other comprehensive                                
 loss                             -         (2,297)
---------------------------------------------------
Balance as at                                      
 December 31, 2012                -        266,545 
Net income                        -          7,418 
Other comprehensive                                
 income                           -         17,500 
---------------------------------------------------
Balance as at                                      
 September 30, 2013   $           -  $     291,463 
---------------------------------------------------
---------------------------------------------------

 
See accompanying notes to condensed consolidated financial
statements. 


 
TVA GROUP 
INC.                                                              
Consolidated Balance Sheets                                                 
                                                                            
(unaudited)                                                                 
(in thousands of dollars)                                                   
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                              September 30,    December 31, 
                                                       2013            2012 
                                                                 (restated, 
                                        Note                        note 2) 
----------------------------------------------------------------------------
Assets                                                                      
Current assets                                                              
  Cash                                      $         7,163 $        10,619 
  Accounts receivable                               116,194         115,925 
  Income taxes                                        1,438           3,152 
  Programs, broadcast and distribution                                      
   rights and inventories                  6         73,418          67,579 
  Prepaid expenses                                    2,093           2,426 
----------------------------------------------------------------------------
                                                    200,306         199,701 
Non-current assets                                                          
  Broadcast and distribution rights        6         31,792          33,563 
  Investments                                        15,146          17,651 
  Property, plant and equipment                      99,192          98,494 
  Licences and other intangible assets              112,634         112,056 
  Goodwill                                 7         44,504          39,781 
  Deferred income taxes                               1,515             725 
----------------------------------------------------------------------------
                                                    304,783         302,270 
----------------------------------------------------------------------------
Total assets                                $       505,089 $       501,971 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Liabilities and equity                                                      
                                                                            
Current liabilities                                                         
  Accounts payable and accrued                                              
   liabilities                              $        82,578 $        89,092 
  Income taxes                                          767             816 
  Broadcast and distribution rights                                         
   payable                                           18,544          16,966 
  Provisions                                            626             862 
  Deferred revenues                                   8,816           6,136 
----------------------------------------------------------------------------
                                                    111,331         113,872 
Non-current liabilities                                                     
  Long-term debt                                     74,589          74,438 
  Other liabilities                                   9,752          38,499 
  Deferred income taxes                              17,954           8,617 
----------------------------------------------------------------------------
                                                    102,295         121,554 
Equity                                                                      
  Capital stock                           10         98,647          98,647 
  Contributed surplus                     12            581             581 
  Retained earnings                                 195,355         187,937 
  Accumulated other comprehensive loss               (3,120)        (20,620)
----------------------------------------------------------------------------
  Equity attributable to shareholders               291,463         266,545 
----------------------------------------------------------------------------
Total liabilities and equity                $       505,089 $       501,971 
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
See accompanying notes to condensed consolidated financial
statements. 
On November 5, 2013, the Board of Directors approved the condensed
consolidated financial statements for the three-month and nine-month
periods ended September 30, 2013 and 2012. 


 
TVA GROUP INC.                                                              
Consolidated Statements of Cash Flows                                       
                                                                            
(unaudited)                                                                 
(in thousands of dollars)                                                   
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                               Three-month periods       Nine-month periods 
                                ended September 30       ended September 30 
----------------------------------------------------------------------------
                                 2013         2012        2013         2012 
                                        (restated,               (restated, 
                        Note               note 2)                  note 2) 
----------------------------------------------------------------------------
                                                                            
Cash flows related to                                                       
 operating activities                                                       
  Net income (loss)        $    6,325  $     1,539  $    7,418  $   (19,716)
  Non-cash items:                                                           
    Amortization                5,544        5,020      16,107       15,687 
    Impairment of                                                           
     assets                6      611            -       1,610            - 
    Impairment of                                                           
     goodwill              7        -            -           -       32,200 
    Gain on disposal                                                        
     of investments        8        -            -           -      (12,881)
    Share of loss                                                           
     (income) of                                                            
     associated                                                             
     corporations and                                                       
     joint ventures             1,675        1,860       4,653         (182)
    Deferred income                                                         
     taxes                        339            7       1,248          380 
----------------------------------------------------------------------------
                               14,494        8,426      31,036       15,488 
  Net change in non-                                                        
   cash items                  (1,497)       9,886      (9,852)       7,075 
----------------------------------------------------------------------------
Cash flows provided by                                                      
 operating activities          12,997       18,312      21,184       22,563 
----------------------------------------------------------------------------
                                                                            
Cash flows related to                                                       
 investing activities                                                       
  Additions to                                                              
   property, plant and                                                      
   equipment                   (4,642)      (5,566)    (14,190)     (17,668)
  Additions to                                                              
   intangible assets             (773)        (892)     (1,695)      (2,195)
  Business                                                   
               
   (acquisition)                                                            
   disposal             9,12   (6,607)         765      (6,607)         765 
  Net change in                                                             
   investments          8,12   (1,477)      (1,493)     (2,148)      19,470 
  Cash of SUN News at                                                       
   the date of                                                              
   deconsolidation        12        -            -           -         (430)
----------------------------------------------------------------------------
Cash flows used in                                                          
 investing activities         (13,499)      (7,186)    (24,640)         (58)
----------------------------------------------------------------------------
                                                                            
Cash flows related to                                                       
 financing activities                                                       
  Net change in bank                                                        
   overdraft                        -       (4,943)          -       (3,980)
  Net change in                                                             
   revolving credit                                                         
   facility                         -         (454)          -      (17,736)
  Financing costs                   -            -           -         (344)
  Non-controlling                                                           
   interest               12        -            -           -        3,528 
----------------------------------------------------------------------------
Cash flows used in                                                          
 financing activities               -       (5,397)          -      (18,532)
----------------------------------------------------------------------------
                                                                            
Net change in cash               (502)       5,729      (3,456)       3,973 
Cash at beginning of                                                        
 period                         7,665            -      10,619        1,756 
----------------------------------------------------------------------------
Cash at end of period      $    7,163  $     5,729  $    7,163  $     5,729 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Interest and taxes                                                          
 reflected as                                                               
 operating activities                                                       
  Interest paid            $      130  $        48  $    2,326  $     2,795 
  Income taxes                                                              
   (received) paid               (575)      (1,501)        814        1,971 
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
See accompanying notes to condensed consolidated financial
statements. 


 
TVA GROUP INC.                                                              
Notes to Condensed Consolidated Financial Statements                        
                                                                            
Three-month and nine-month periods ended September 30, 2013 and 2012        
(unaudited)                                                                 
(Tabular amounts are expressed in thousands of dollars, except per share and
per option amounts)                                                         
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
TVA Group Inc. ("TVA Group" or the "Corporation") is governed by the
Quebec Business Corporations Act. TVA Group is an integrated
communications company with two operating segments: Television and
Publishing (note 13). The Corporation is a subsidiary of Quebecor
Media Inc. ("Quebecor Media" or the "parent corporation") and the
ultimate parent corporation is Quebecor Inc. ("Quebecor"). The
Corporation's head office is located at 1600 de Maisonneuve Boulevard
East, Montreal, Quebec, Canada. 
The Corporation's businesses experience significant seasonality due,
among other factors, to seasonal advertising patterns and influences
on people's viewing, reading and listening habits. Because the
Corporation depends on the sale of advertising for a significant
portion of its revenue, operating results are also sensitive to
prevailing economic conditions, including changes in local, regional
and national economic conditions, particularly as they may affect
advertising expenditures. Accordingly, the results of operations for
interim periods should not necessarily be considered indicative of
full-year results. 
1. Basis of presentation 
These consolidated financial statements were prepared in accordance
with International Financial Reporting Standards ("IFRS") as issued
by the International Accounting Standards Board ("IASB"), except that
they do not include all disclosures required under IFRS for annual
consolidated financial statements. In particular, these consolidated
financial statements were prepared in accordance with IAS 34, Interim
Financial Reporting, and accordingly, they are condensed consolidated
financial statements. They are presented in Canadian dollars, which
is the currency of the primary economic environment in which the
Corporation and its subsidiaries operate ("functional currency").
These condensed consolidated financial statements should be read in
conjunction with the Corporation's 2012 annual consolidated financial
statements, which describe the accounting policies used to prepare
these financial statements. 
Comparative figures for the three-month and nine-month periods ended
September 30, 2012 have been restated to conform to the presentation
adopted for the three-month and nine-month periods ended September
30, 2013. 
2. Changes in accounting policies 
On January 1, 2013, the Corporation adopted retrospectively the
following standards. Unless otherwise indicated, the adoption of
these new standards did not have a material impact on prior period
comparative figures. 


 
i)   IFRS 10 Consolidated Financial Statements replaces SIC 12             
     Consolidation - Special Purpose Entities and parts of IAS 27          
     Consolidated and Separate Financial Statements and provides additional
     guidance regarding the concept of control as the determining factor in
     whether an entity should be included in the consolidated financial    
     statements of the parent corporation.                                 
                                                                           
ii)  IFRS 11 Joint Arrangements replaces IAS 31 Interests in Joint Ventures
     with guidance that focuses on the rights and obligations of the       
     arrangement, rather than its legal form. It also withdraws the option 
     to proportionately consolidate an entity's interest in joint ventures.
     The new standard requires that such interests be recognized using the 
     equity method.                                                        
                                                                           
     The adoption of the standard had the following impacts on comparative 
     figures for the nine-month period ended September 30, 2012 (no impact 
     for the three-month period ended September 30, 2012 (note 8)):        
                                                                           
Consolidated Statement of Income                       
                     
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Increase (decrease)                                                         
----------------------------------------------------------------------------
Revenues                                                   $         (4,219)
Purchases of goods and services                                      (2,512)
Financial expenses                                                        7 
----------------------------------------------------------------------------
Loss before tax expense and share ofincome of associated                    
 corporations andjoint ventures                                             
                                                                      1,714 
Share of loss (income) of associatedcorporations and joint                  
 ventures                                                            (1,714)
----------------------------------------------------------------------------
Net income                                                 $              - 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
iii) IFRS 12 Disclosure of Interests in Other Entities is a new and        
     comprehensive standard on disclosure requirements for all forms of    
     interests in other entities, including joint arrangements, associates,
     special purpose entities and other off-balance sheet vehicles.        
                                                                           
iv)  IFRS 13 Fair Value Measurement is a new and comprehensive standard    
     that sets out a framework for measuring at fair value and that        
     provides guidance on required disclosures about fair value            
     measurements.                                                         
                                                                           
v)   IAS 1 Presentation of Financial Statements was amended and the        
     principal change resulting from amendments to this standard is the    
     requirement to present separately other comprehensive items that may  
     be reclassified to income and other comprehensive items that will not 
     be reclassified to income.                                            
                                                                           
vi)  IAS 19 Employee Benefits (Amended) involves, among other changes, the 
     immediate recognition of the re- measurement component in other       
     comprehensive income, thereby removing the accounting option          
     previously available in IAS 19 to recognize or to defer recognition of
     changes in defined benefit obligations and in the fair value of plan  
     assets directly in the consolidated statement of income. IAS 19 also  
     introduces a net interest approach that replaces the expected return  
     on assets and interest costs on the defined benefit obligation with a 
     single net interest component determined by multiplying the net       
     defined benefit liability or asset by the discount rate used to       
     determine the defined benefit obligation. In addition, all past       
     service costs are required to be recognized in profit or loss when the
     employee benefit plan is amended and no longer spread over any future 
     service period. IAS 19 also allows amounts recorded in other          
     comprehensive income to be recognized either immediately in retained  
     earnings or as a separate category within equity. The Corporation has 
     elected to immediately recognize in accumulated other comprehensive   
     income the amounts recorded in other comprehensive income.            
                                                                           
     The adoption of the amended standard had the following impacts on     
     prior period comparative figures:                                     
                                                                           
                                                                           
Consolidated Statements of Income                                           
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                     Three-month period   Nine-month period 
                                                  ended               ended 
Increase (decrease)                  September 30, 2012  September 30, 2012 
----------------------------------------------------------------------------
Employee costs                       $              343  $            1,027 
Financial expenses                                  462               1,387 
Deferred income tax expense                        (217)               (650)
----------------------------------------------------------------------------
Net income                           $             (588) $           (1,764)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Consolidated balance sheets                                                 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Increase (decrease)                   December 31, 2012   December 31, 2011 
----------------------------------------------------------------------------
Other liabilities                    $                -  $            1,251 
Deferred income tax liability                         -                (336)
Retained earnings                                20,620              17,408 
Accumulated other comprehensive                                             
 income                                         (20,620)            (18,323)
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
3. Revenues 
The breakdown of revenues between services rendered and product sales
is as follows: 


 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
                               Three-month periods        Nine-month periods
                                ended September 30        ended September 30
----------------------------------------------------------------------------
                                 2013         2012         2013         2012
                                        (restated,                (restated,
                                           note 2)                   note 2)
----------------------------------------------------------------------------
Services rendered(1)     $     77,711 $     72,458 $    250,555 $    249,345
Product sales                  24,506       24,713       74,239       76,798
----------------------------------------------------------------------------
                         $    102,217 $     97,171 $    324,794 $    326,143
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) The Corporation collects royalties on the retransmission of its       
    television signal in markets located outside the local service areas  
    of its over-the-air stations. During the third quarter of 2013, the   
    Copyright Board of Canada (the "Board") completed its consultations on
    the issues surrounding an agreement on a new division of roy
alties    
    between copyright collective societies for the 2009-2013 period,      
    whereby the Corporation's share of the royalties is significantly     
    increased. The agreement was endorsed by the Board. Accordingly, based
    on the confirmed new information, the Corporation recorded in the     
    third quarter of 2013 an amount to reflect the increase in its share  
    of the royalties, of which $6,111,000 applied to the years 2009 to    
    2012 and $730,000 to the first two quarters of 2013.                  

 
4. Purchases of goods and services 
The main components of purchases of goods and services are as
follows: 


 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                       Three-month periods ended    Nine-month periods ended
                                    September 30                September 30
----------------------------------------------------------------------------
                              2013         2012           2013         2012 
                                     (restated,                  (restated, 
                                         note 2)                     note 2)
----------------------------------------------------------------------------
Royalties, rights                                                           
 and production                                                             
 costs               $      30,771 $      30,359 $     112,481 $     113,075
Printing and                                                                
 distribution                5,024         4,856        14,342        17,298
Marketing,                                                                  
 advertising and                                                            
 promotion                   3,896         2,098        12,271        11,470
Buildings costs              2,134         2,270         6,526         7,355
Services rendered by                                                        
 parent corporation          4,570         3,602        16,542        12,817
Other                        5,656         9,003        21,804        29,490
----------------------------------------------------------------------------
                     $      52,051 $      52,188 $     183,966 $     191,505
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
5. Financial expenses                          


 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                           Three-month periods            Nine-month periods
                            ended September 30            ended September 30
----------------------------------------------------------------------------
                           2013           2012           2013           2012
                                    (restated,                    (restated,
                                       note 2)                       note 2)
----------------------------------------------------------------------------
Interest on long-                                                           
 term debt        $       1,139  $       1,148  $       3,387  $       3,846
Amortization of                                                             
 financing costs             50            107            151            315
Interest on net                                                             
 defined benefit                                                            
 liability                  420            462          1,260          1,387
Other                       (21)           (44)            (9)             7
----------------------------------------------------------------------------
                  $       1,588  $       1,673  $       4,789  $       5,555
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
6. Operational restructuring costs, impairment of assets and other
costs 
During the three-month period ended September 30, 2013, the
Corporation recorded an additional $611,000 inventory impairment
charge in connection with the discontinuation of its TVA Boutiques
division's home shopping and online shopping operations. For the
nine-month period ended September 30, 2013, the impairment charge
related to the discontinuation of operations totalled $1,223,000 in
addition to a $303,000 provision for operational restructuring costs. 
In the three-month period ended September 30, 2013, the Corporation
recorded $138,000 in operational restructuring costs in connection
with staff reductions, mainly in the Publishing segment ($1,784,000
for the nine- month period ended September 30, 2013, including
$879,000 in the Television segment and $905,000 in the Publishing
segment). In the nine-month period ended September 30, 2012, the
Corporation recorded $117,000 in operational restructuring costs in
connection with staff reductions in the Publishing segment. 
During the nine-month period ended September 30, 2013, the
Corporation also recorded a $387,000 impairment charge related to its
long-term distribution rights inventory following its decision in the
first quarter of 2013 to discontinue theatrical distribution of new
Quebec films. 
7. Impairment of goodwill 
During the first quarter of 2012, following the adoption of new rates
for business contributions towards the cost of waste recovery and
recycling services provided by Quebec municipalities, the Corporation
had to review its business plan for the related activities and
perform an impairment test on the Publishing cash-generating unit
("CGU"). The Corporation concluded that the recoverable amount based
on value in use was less than the carrying amount of the Publishing
CGU and a goodwill impairment charge of $32,200,000 was recorded. 
8. Gain on disposal of investments 
On May 31, 2012, following Canadian Radio-television and
Telecommunications Commission approval, the Corporation completed the
sale of its 51% interest in "The Cave" and its 50% interest in
"Mystery TV" to its partner in the joint ventures, Shaw Media Global
Inc., for a total cash consideration of $20,963,000. A $12,881,000
gain on disposal of investments, before income taxes, was recorded.
The transaction did not give rise to any income tax charge because
the Corporation used unrecorded capital losses to eliminate the
capital gains tax on disposal of investments. 
9. Business acquisition 
On July 18, 2013, the Corporation acquired all of the issued and
outstanding shares of Les Publications Charron & Cie inc., publisher
of La Semaine magazine, for a total consideration of $7,638,000, of
which $438,000 remains unpaid in respect of acquired working capital
items. As part of this transaction, the Corporation also acquired all
of the issued and outstanding shares of Charron Editeur inc., a
publishing house, and simultaneously transferred its operations to
Sogides Group, a corporation under common control, for the equivalent
of the price paid, namely an agreed price of $212,000, net of
transferred working capital items. The results of the new subsidiary,
Les Publications Charron & Cie inc., have been included in the
Corporation's consolidated results since July 18, 2013. As the
purchase price allocation process was not completed as of September
30, 2013, the amounts allocated to assets and liabilities may be
changed subsequently. 
The preliminary allocation of the acquisition price of Les
Publications Charron & Cie inc. is as follows: 


 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                       
                                                2013 
----------------------------------------------------------------------------
Assets acquired                                                             
  Cash                                                         $        593 
  Current assets                                                      1,138 
  Property, plant and equipment                                          94 
  Intangible assets                                                   3,030 
  Goodwill                                                            4,723 
  Deferred income taxes                                                  28 
----------------------------------------------------------------------------
                                                                      9,606 
Liabilities assumed                                                         
  Current liabilities                                                (1,293)
  Deferred income taxes                                                (675)
----------------------------------------------------------------------------
                                                                     (1,968)
----------------------------------------------------------------------------
Net assets acquired at fair value                              $      7,638 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Consideration                                                               
Cash                                                                  7,200 
Liability related to the preliminary adjustment in working                  
 capital                                                                438 
----------------------------------------------------------------------------
                                                               $      7,638 
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
The Corporation's consolidated revenues and its consolidated pro
forma net income would not have been materially different from the
actual numbers if the business acquisition had occurred at the
beginning of the nine- month period ended September 30, 2013. 
No goodwill is deductible for income tax purposes. 
10. Capital stock  
a) Authorized capital stock 
An unlimited number of Class A common shares, participating, voting,
without par value. 
An unlimited number of Class B shares, participating, non-voting,
without par value. 
An unlimited number of preferred shares, non-participating,
non-voting, with a par value of $10 each, issuable in series.  
b) Issued and outstanding capital stock  


 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                      September 30, 2013   December 31, 2012
----------------------------------------------------------------------------
4,320,000 Class A Common Shares       $               72  $               72
19,450,906 Class B shares                         98,575              98,575
----------------------------------------------------------------------------
                                      $           98,647  $           98,647
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
c) Earnings (loss) per share attributable to shareholders 
The following table sets forth the computation of basic and diluted
earnings (loss) per share attributable to shareholders: 


 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                              Three-month periods       Nine-month periods  
                                ended September 30       ended September 30 
----------------------------------------------------------------------------
                                 2013         2012         2013        2012 
                                        (restated,               (restated, 
                                           note 2)                  note 2) 
----------------------------------------------------------------------------
Net income (loss)                                                           
 attributable to                                                            
 shareholders            $      6,325 $      1,539 $      7,418 $   (15,302)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Weighted average number                                                     
 of basic and diluted                                                       
 shares outstanding        23,770,906   23,770,906   23,770,906  23,770,906 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Basic and diluted                                                           
 earnings (loss) per                                                        
 share attributable to                                                      
 shareholders (in                                                           
 dollars)                $       0.27 $       0.06 $       0.31 $     (0.64)
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
The diluted earnings (loss) per share calculation does not take into
consideration the potential dilutive effect of stock options of the
Corporation since their impact is anti-dilutive. 
11. Stock-based compensation and other stock-based payments 


 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                  Nine-month period ended September 30, 2013
----------------------------------------------------------------------------
                              Corporation's Class B     Quebecor Media stock
                                      stock options                  options
----------------------------------------------------------------------------
                                           Weighted                 Weighted
                                            average                  average
                                           exercise                 exercise
                               Number         price     Number         price
----------------------------------------------------------------------------
Balance as at December 31,                                                  
 2012                         819,421  $      16.34    213,416  $      46.55
Granted                             -             -    207,000         57.64
Exercised                           -             -    (41,884)        46.70
Cancelled                    (128,345)        15.29    (32,500)        47.68
Options related to                                                          
 executives transferred to                                                  
 Quebecor Media                     -             -    (14,625)        46.48
----------------------------------------------------------------------------
Balance as at September                                                     
 30, 2013                     691,076  $      16.54    331,407  $      53.35
----------------------------------------------------------------------------
------------------------------------------------------------------
----------

 
Of the options outstanding as at September 30, 2013, 691,076
Corporation Class B stock options at an average exercise price of
$16.54 and 46,407 Quebecor Media stock options at an average price of
$45.76 could be exercised. 
During the three-month period ended September 30, 2013, no Quebecor
Media stock options were exercised. During the nine-month period
ended September 30, 2013, 41,884 Quebecor Media stock options were
exercised for a cash consideration of $471,000 (113,728 stock options
were exercised for a cash consideration of $629,000 during the
three-month and nine-month periods ended September 30, 2012). 
During the three-month and nine-month periods ended September 30,
2013, the Corporation recorded compensation expense reversals of
$99,000 and $130,000 respectively (compensation expense reversals of
$19,000 and $264,000 respectively in the same periods of 2012) in
relation to the Corporation's Class B stock options, and it recorded
compensation expenses of $387,000 and $317,000 respectively
(compensation expense reversal of $64,000 and compensation expense of
$482,000 respectively in the same periods of 2012) in relation to
Quebecor Media stock options. 
12. Related party transactions 
Capital contributions to SUN News 
During the three-month period ended September 30, 2013, the partners
in SUN News made a capital contribution of $4,500,000 ($3,600,000 in
2012), including $2,205,000 from the Corporation ($1,764,000 in 2012)
and $2,295,000 from Sun Media Corporation, a company under common
control ($1,836,000 in 2012). 
During the nine-month period ended September 30, 2013, the partners
in SUN News made a capital contribution of $7,500,000 ($10,800,000 in
2012), including $3,675,000 from the Corporation ($5,436,000 in 2012)
and $3,825,000 from Sun Media Corporation ($5,364,000 in 2012). 
Disposal of interest in SUN News 
On June 30, 2012, the Corporation sold a 2% interest in SUN News to
Sun Media Corporation for a cash consideration of $765,000.The
Corporation now holds a 49% interest in SUN News and Sun Media
Corporation owns 51%. The difference between the amount paid and the
book value of the interest yielded a $581,000 gain, which was
accounted for in contributed surplus. Following the loss of control,
SUN News' results are no longer consolidated as of July 1, 2012, and
the investment in SUN News is now accounted for using the equity
method. 
The following table shows details of the net assets of SUN News,
which were reclassified as an investment using the equity method at
the date of deconsolidation. 


 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Current assets                                                              
  Cash                                                         $        430 
  Accounts receivable and other current assets                        2,792 
----------------------------------------------------------------------------
                                                                      3,222 
Non-current assets                                                          
  Property, plant and equipment                                       8,873 
  Intangible assets                                                     650 
----------------------------------------------------------------------------
                                                                     12,745 
Current liabilities                                                         
  Accounts payable and accrued liabilities                            3,555 
----------------------------------------------------------------------------
Net assets                                                            9,190 
Sun Media Corporation interest                                       (4,687)
----------------------------------------------------------------------------
Investment using equity method                                 $      4,503 
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
13. Segmented information 
The Corporation's business segments are: 


 
--  The Television segment, which includes the operations of TVA Network
    (including the subsidiaries and divisions TVA Productions Inc., TVA
    Sales and Marketing Inc., TVA Acces, TVA Nouvelles, TVA Interactif),
    specialty services, the marketing of digital products associated with
    the different televisual brands, the home and online shopping services
    of the TVA Boutiques division up to the second quarter of 2013, and the
    distribution of audiovisual products by the TVA Films division. 
--  The Publishing segment, which includes the operations of TVA
    Publications Inc. and Les Publications Charron & Cie inc. - which
    publish French-language magazines in various fields such as the arts,
    entertainment, television, fashion and decoration, and market digital
    products associated with the different magazine brands - and the
    operations of the TVA Studio division, which specializes in custom
    publishing, commercial print production and premedia services. 
 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                            Three-month periods          Nine-month periods 
                             ended September 30          ended September 30 
----------------------------------------------------------------------------
                             2013          2012          2013          2012 
                                     (restated,                  (restated, 
                                        note 2)                     note 2) 
----------------------------------------------------------------------------
Revenues                                                                    
  Television         $     83,734  $     81,646  $    277,268  $    279,379 
  Publishing               19,211        16,854        49,986        49,973 
  Intersegment items         (728)       (1,329)       (2,460)       (3,209)
----------------------------------------------------------------------------
                     $    102,217  $     97,171  $    324,794  $    326,143 
Operating income(1)                                                         
  Television               14,658         8,051        34,253        19,011 
  Publishing                3,743         2,290         5,983         2,846 
----------------------------------------------------------------------------
                           18,401        10,341        40,236        21,857 
Amortization of                                                             
 property, plant and                                                        
 equipment and                                                              
 intangible assets          5,494         4,913        15,956        15,372 
Financial expenses          1,588         1,673         4,789         5,555 
Operational                                                                 
 restructuring                                                              
 costs, impairment                                                          
 of assets and other                                                        
 costs                        875             -         3,874           117 
Impairment of                                                               
 goodwill                       -             -             -        32,200 
Gain on disposal of                                                         
 investments                    -             -             -       (12,881)
----------------------------------------------------------------------------
Income (loss) before                                                        
 
 tax expense                                                                
 andshare of income                                                         
 of associated                                                              
 corporations and                                                           
 joint ventures      $     10,444  $      3,755  $     15,617  $    (18,506)
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
The above-noted intersegment items represent the elimination of
normal course business transactions between the Corporation's
business segments regarding revenues. 


 
(1) The Chief Executive Officer uses operating income as a measure of     
    financial performance for assessing the performance of each of the    
    Corporation's segments. Operating income is defined as net income     
    (loss) before amortization of property, plant and equipment and       
    intangible assets, financial expenses, operational restructuring      
    costs, impairment of assets and other costs, impairment of goodwill,  
    gain on disposal of investments, tax expense, share of loss (income)  
    of associated corporations and joint ventures, and net loss           
    attributable to non-controlling interest. Operating income as defined 
    above is not a measure of results that is consistent with IFRS.       

Contacts:
Denis Rozon, CPA, CA
Vice President and Chief Financial Officer
(514) 598-2808
 
 
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