Quebecor Inc. Reports Fourth Quarter and Full Year 2013 Consolidated Results

Quebecor Inc. Reports Fourth Quarter and Full Year 2013 Consolidated Results 
MONTREAL, QUEBEC -- (Marketwired) -- 03/13/14 --   Quebecor Inc.
("Quebecor" or the "Corporation") (TSX: QBR.A)(TSX: QBR.B) today
reported its fourth quarter and full year 2013 consolidated financial
results. Quebecor consolidates the financial results of its Quebecor
Media Inc. ("Quebecor Media") subsidiary, in which it holds a 75.4%
interest.  
Highlights  
2013 financial year 


 
 
--  Revenues up $28.3 million (0.7%) from 2012 to $4.28 billion. 
 
--  Adjusted operating income(1) up $70.8 million (5.1%) to $1.45 billion. 
 
--  Net loss attributable to shareholders: $133.9 million ($1.08 per basic
    share) in 2013, compared with net income attributable to shareholders in
    the amount of $161.1 million ($1.27 per basic share) in 2012, an
    unfavourable variance of $295.0 million ($2.35 per basic share),
    including the total $299.4 million unfavourable non-cash impact of
    fluctuations in the value of goodwill, intangible assets and derivative
    financial instruments. 
 
--  Adjusted income from continuing operations(2): $214.1 million in 2013
    ($1.73 per basic share), compared with $182.3 million ($1.44 per basic
    share) in 2012, an increase of $31.8 million ($0.29 per basic share). 
 
--  The Telecommunications segment grew its revenues by $114.0 million
    (4.4%) and its adjusted operating income by $81.1 million (6.7%) in 2013
    despite strong competition. 
 
--  Videotron Ltd. ("Videotron") recorded revenue increases in 2013 for all
    its main services: mobile telephony ($49.1 million or 28.6%), Internet
    access ($45.9 million or 5.9%), cable telephony ($18.9 million or 4.2%),
    and cable television ($11.0 million or 1.0%). 
 
--  Videotron revenue-generating units(3) up 122,700 in 2013, compared with
    an increase of 221,800 in 2012. Videotron passed the five-million
    revenue-generating unit mark in 2013. At year's end, there were 503,300
    subscriber connections to the mobile telephone service launched in 2010.
 
--  On February 19, 2014, Videotron acquired seven 700 MHz spectrum licences
    in Canada's four most populous provinces for a cash consideration of
    $233.3 million in the Industry Canada spectrum auction. 
 
--  On December 19, 2013, Quebecor Media announced that it was abandoning
    door-to-door distribution of community newspapers and flyers in Quebec
    and discontinuing distribution of the Le Sac Plus doorknob bag as of
    January 2014. 
 
--  On December 5, 2013, Sun Media Corporation announced the sale of 74
    Quebec weeklies to Transcontinental Interactive Inc., ("Transcontinental
    Interactive"), a subsidiary of Transcontinental Inc.
    ("Transcontinental"), for a cash consideration of $75.0 million. 
 
--  In November 2013, Quebecor reached a twelve-year agreement with Rogers
    Communications Inc. and the National Hockey League ("NHL") whereby TVA
    Sports will become the NHL's official French-language broadcaster in
    Canada as of the 2014-15 season. 
 
--  In May 2013, Videotron and Rogers Communications Partnership ("Rogers")
    reached a 20-year agreement to build out and operate a shared LTE mobile
    network in the Province of Quebec and the Ottawa area. 
 
--  On May 8, 2013, Robert Depatie replaced Pierre Karl Peladeau as
    President and Chief Executive Officer of Quebecor and of Quebecor Media.
    Manon Brouillette was named President and Chief Operating Officer of
    Videotron. On the same date, Pierre Karl Peladeau became Chairman of the
    Board of Quebecor Media and of TVA Group, and Vice Chairman of the Board
    of Quebecor. 
 
--  Following his decision to enter politics and run as a candidate, Pierre
    Karl Peladeau resigned from all his positions with Quebecor and its
    subsidiaries on March 9, 2014. Subsequently, Sylvie Lalande was
    appointed Chairperson of the Board of TVA Group on March 10, 2014 and
    Francoise Bertrand was appointed Chairperson of the Board of Quebecor
    Media on March 12, 2014. Robert Depatie became a director of Quebecor,
    Quebecor Media and TVA Group on March 12, 2014. 
 
(1) See "Adjusted operating income" under "Definitions."                    
(2) See "Adjusted income from continuing operations" under "Definitions."   
(3) The sum of cable television, cable and mobile Internet access, and cable
    telephony service subscriptions and subscriber connections to the mobile
    telephony service.                                                      

Fourth quarter 2013 


 
 
--  Revenues up $5.7 million (0.5%) to $1.12 billion. 
 
--  Adjusted operating income up $25.2 million (6.9%) to $391.3 million.
    Adjusted operating income up $17.6 million (5.8%) in the
    Telecommunications segment. 
 
--  Net income attributable to shareholders: $43.4 million ($0.35 per basic
    share) in the fourth quarter of 2013 compared with $7.1 million ($0.06
    per basic share) in the same period of 2012, a favourable variance of
    $36.3 million ($0.29 per basic share). 
 
--  Adjusted income from continuing operations: $68.0 million in the fourth
    quarter of 2013 ($0.55 per basic share), compared with $52.3 million
    ($0.42 per basic share) in the same period of 2012, an increase of $15.7
    million ($0.13 per basic share). 
 
--  Videotron revenue-generating units increased 35,100 in the fourth
    quarter of 2013. 

"Quebecor continued its growth in 2013 with a $70.8 million increase in
adjusted operating income and a $31.8 million increase in adjusted
income from continuing operations," noted Robert Depatie, President
and Chief Executive Officer of Quebecor. "The Corporation also made a
number of major strategic transactions and agreements, including the
acquisition of seven 700 MHz spectrum licences across Canada, a
20-year agreement with Rogers to build and operate a shared LTE
wireless network, and the acquisition of French-language broadcast
rights to NHL games in Canada for the next 12 years. These
transactions open immense opportunities for future development and
growth for the Corporation.  
"The 700 MHz operating licences acquired by Videotron on February 19,
2014 in the Industry Canada spectrum auction for $233.3 million cover
the entirety of the provinces of Quebec, Ontario (except Northern
Ontario), Alberta and British Columbia. They make it possible to
reach approximately 80% of Canada's population, more than 28 million
people. Quebecor Media could not let pass this opportunity to invest
in the acquisition of such intrinsically valuable licences in the
rest of Canada. While no decision has yet been made on how to use the
spectrum, various options for maximizing the value of our investment
are now available to us."  
"Videotron registered another stand-out performance in 2013,"
commented Manon Brouillette, President and Chief Operating Officer of
Videotron. "Revenues and revenue-generating units were up for the
eleventh consecutive year, despite very competitive market
conditions. Videotron's revenues grew 4.4% to $2.71 billion and its
adjusted operating income rose 6.7% to a record $1.28 billion.
Average monthly revenue per user ("ARPU") increased $6.46 (5.8%) to
$118.03 in 2013. The results demonstrate Videotron's ability to adapt
effectively to the business environment, to approach product
development and marketing with constantly renewed creativity, to
stringently control its operating costs and to place the quality of
the customer experience above all else at all times.  
"During 2013
, Videotron launched Club illico, a subscription video on
demand service which carries the largest selection of unlimited
on-demand French-language titles in Canada. By the end of 2013, the
service had nearly 60,000 subscribers and had logged more than 11.0
million orders since its inception. Videotron also reached a 20-year
agreement with mobile carrier Rogers to build out and operate a
shared LTE wireless network in Quebec and the Ottawa area, which will
be mutually beneficial to the two companies and their customers."  
"The refocusing of our news media operations continued in 2013,"
commented Julie Tremblay, President and Chief Executive Officer of
Sun Media Corporation. "The News Media segment's adjusted operating
income fell 7.0% to $97.7 million over the year 2013 but rose by
19.3% in the fourth quarter, reflecting among other things the impact
of the many cost-containment and repositioning measures implemented
in recent years. The series of restructuring initiatives announced by
Sun Media Corporation in 2013 are expected to yield an estimated
$67.0 million in total annual savings, of which a significant portion
remains to be realized in 2014. These savings will be used to finance
expansion of value-added content offerings on print and digital
platforms. As part of its repositioning, Sun Media Corporation also
announced in December 2013 the sale of 74 Quebec community weeklies
to Transcontinental Interactive for a $75.0 million cash
consideration and its decision to discontinue its door-to-door
distribution network as of January 2014."  
In the Broadcasting segment, adjusted operating income increased by
$12.0 million (35.9%) in 2013 to $45.4 million, reflecting among
other things the favourable impact of a retroactive adjustment to
royalties for distant signal retransmission for the years 2009 to
2013, the decrease in the adjusted operating loss of SUN News General
Partnership, as well as the positive impact of restructuring
initiatives introduced by TVA Group in 2013 with a view to
maintaining its leading position in Quebec and safeguarding the
quality of its content. With respect to business development, the TVA
Sports specialty channel secured a strong position in 2013 by
becoming the NHL's official French-language broadcaster in Canada for
the next 12 years under an agreement of historic importance for the
Broadcasting sector.  
Quebecor Media pursued its diversification strategy by acquiring
Event Management Gestev inc., a Quebec City sporting and cultural
event manager, in 2013, while TVA Group announced the acquisition of
Les Publications Charron & Cie inc., publisher of La Semaine
magazine, and of Charron Editeur inc. Quebecor Media also sold the
specialized websites Jobboom and Reseau Contact for a selling price
of $65.0 million.  
"On the financial front, Quebecor continued its efforts to reduce its
refinancing risk in 2013 by seizing opportunities that will also
significantly lower its interest expense, realizing annual savings of
more than $20.0 million," said Jean-Francois Pruneau, Senior Vice
President and Chief Financial Officer of Quebecor. "As well,
Videotron issued Senior Notes in the aggregate principal amount of
$400.0 million at an advantageous 5.625% interest rate, the first
issue of high-yield 12-year Notes on the Canadian market. It should
also be noted that the financial operations carried out since the
beginning of 2012, including the purchase in October 2012 of part of
the interest in Quebecor Media held by CDP Capital d'Amerique
Investissement inc., a subsidiary of the Caisse de depot et placement
du Quebec, contributed to the 17.4% increase in adjusted income from
continuing operations in 2013."  
"During 2013, Quebecor posted solid consolidated financial results
and continued growth in the Telecommunications segment," said Robert
Depatie. "As well, by carrying out major strategic transactions and
disposing of certain activities that no longer fit its development
objectives, Quebecor is positioning itself favourably to pursue its
business development goals, grow its profits and maximize shareholder
value going forward."  


 
 
Table 1                                                                     
Quebecor financial highlights, 2009 to 2013                                 
(in millions of Canadian dollars, except per share data)                    
 

 
 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                            2013(1)    2012(1)   2011(1)   2010(1)   2009(2)
----------------------------------------------------------------------------
 
Revenues                  $ 4,277.2  $ 4,248.9 $ 4,094.7 $ 3,910.6 $ 3,716.3
Adjusted operating income   1,451.8    1,381.0   1,318.8   1,314.1   1,256.1
(Loss) income from                                                          
 continuing operations                                                      
 attributable to                                                            
 shareholders                (148.4)     162.8     188.3     216.3     269.3
Net (loss) income                                                           
 attributable to                                                            
 shareholders                (133.9)     161.1     196.4     223.4     277.7
Adjusted income from                                                        
 continuing operations        214.1      182.3     178.4     211.6     228.8
Per basic share:(3)                                                         
  (Loss) income from                                                        
   continuing operations                                                    
   attributable to                                                          
   shareholders               (1.20)      1.29      1.47      1.68      2.09
  Net (loss) income                                                         
   attributable to                                                          
   shareholders               (1.08)      1.27      1.53      1.74      2.16
  Adjusted income from                                                      
   continuing operations       1.73       1.44      1.39      1.65      1.78
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
(1) Financial figures for 2010 to 2013 are presented in accordance with     
    International Financial Report Standards ("IFRS").                      
(2) Financial figures for 2009 are presented in accordance with Canadian    
    Generally Accepted Accounting Principles.                               
(3) Per share data has been retroactively adjusted to reflect the two-for-  
    one split of the Corporation's shares on August 14, 2013.               

Discontinued operations  
On December 5, 2013, Quebecor Media announced the sale of 74 Quebec
weeklies to Transcontinental Interactive, a subsidiary of
Transcontinental, for a cash consideration of $75.0 million. The
transaction is subject to approval by regulatory authorities.
Quebecor Media sold its specialized websites Jobboom and Reseau
Contact on June 1, 2013 for a total cash consideration of $59.2
million, net of disposed-of cash in the amount of $5.8 million. The
operating results and cash flows related to those businesses, as well
as the $37.6 million gain on the sale of the two websites, were
reclassified as discontinued operations in the consolidated
statements of income and cash flows. 
2013/2012 financial year comparison  
Revenues: $4.28 billion, a $28.3 million (0.7%) increase.  


 
 
--  Revenues increased in Telecommunications ($114.0 million or 4.4% of
    segment revenues) and Broadcasting ($1.3 million or 0.3%). 
 
--  Revenues decreased in News Media ($91.3 million or -10.4%), Leisure and
    Entertainment ($12.7 million or -4.1%) and Interactive Technologies and
    Communications ($6.3 million or -4.3%). 

Adjusted operating income: $1.45 billion, a $70.8 million (5.1%)
increase. 


 
 
--  Adjusted operating income increased in Telecommunications ($81.1 million
    or 6.7% of segment adjusted operating income), Broadcasting ($12.0
    million or 35.9%) and Interactive Technologies and Communications ($4.6
    million o
r 46.9%). 
 
--  Adjusted operating income decreased in Leisure and Entertainment ($8.5
    million or -33.9%), News Media ($7.4 million or -7.0%), and at Head
    Office ($11.0 million). The decrease at Head Office was due primarily to
    the unfavourable variance in the fair value of stock options. 
 
--  The change in the fair value of Quebecor Media stock options resulted in
    a $0.4 million unfavourable variance in the consolidated stock-based
    compensation charge in 2013 compared with 2012. The change in the fair
    value of Quebecor stock options resulted in an 11.9 million unfavourable
    variance in the Corporation's stock-based compensation charge in 2013. 

Net loss attributable to shareholders: $133.9 million ($1.08 per basic
share) in 2013, compared with net income attributable to shareholders
in the amount of $161.1 million ($1.27 per basic share) in 2012, an
unfavourable variance of $295.0 million ($2.35 per basic share).  
- The unfavourable variance was due primarily to:  


 
 
--  $374.9 million unfavourable variance in losses and gains on valuation
    and translation of financial instruments; 
 
--  $95.3 million unfavourable variance related to the charge for impairment
    of goodwill and intangible assets; 
 
--  $67.3 million increase in amortization charge; 
 
--  $30.4 million increase in financial expenses; 
 
--  $12.6 million unfavourable variance in losses on debt refinancing. 

Partially offset by:  


 
 
--  $70.8 million increase in adjusted operating income; 
 
--  $23.0 million favourable variance in income from discontinued
    operations, resulting mainly from the gains on disposal of Jobboom and
    Reseau Contact. 

In the third quarter of 2013, Quebecor Media recorded a total $281.3
million non-cash charge in its News Media and Leisure and
Entertainment segments for impairment of goodwill and intangible
assets ($186.0 million in 2012), in accordance with IFRS accounting
valuation principles. The charge reflects weak market conditions and
the impact of the transition to digital in the newspaper, music and
book industries. 
Adjusted income from continuing operations: $214.1 million in 2013
($1.73 per basic share) compared with $182.3 million ($1.44 per basic
share) in 2012, an increase of $31.8 million ($0.29 per basic share). 
2013/2012 fourth quarter comparison  
Revenues: $1.12 billion, a $5.7 million (0.5%) increase.  


 
 
--  Revenues increased in Telecommunications ($24.6 million or 3.7% of
    segment revenues). 
 
--  Revenues decreased in News Media ($18.2 million or -8.2%), Broadcasting
    ($5.9 million or -4.6%), Interactive Technologies and Communications
    ($1.5 million or -4.2%), and Leisure and Entertainment ($0.8 million or
    -0.8%). 

Adjusted operating income: $391.3 million, a $25.2 million (6.9%)
increase. 


 
 
--  Adjusted operating income increased in Telecommunications ($17.6 million
    or 5.8% of segment adjusted operating income), News Media ($7.2 million
    
or 19.3%), Broadcasting ($1.6 million or 10.6%), and Interactive
    Technologies and Communications ($1.4 million or 41.2%). 
 
--  Adjusted operating income decreased in Leisure and Entertainment ($1.1
    million or -12.8%). 
 
--  The change in the fair value of Quebecor Media stock options resulted in
    a $0.8 million unfavourable variance in the stock-based compensation
    charge in the fourth quarter of 2013 compared with the same period of
    2012. The change in the fair value of Quebecor stock options resulted in
    a $0.3 million unfavourable variance in the Corporation's stock-based
    compensation charge in the fourth quarter of 2013. 

Net income attributable to shareholders: $43.4 million ($0.35 per basic
share) in the fourth quarter of 2013 compared with $7.1 million
($0.06 per basic share) in the same period of 2012, a favourable
variance of $36.3 million ($0.29 per basic share). 
- The favourable variance was due primarily to:  


 
 
--  $66.5 million favourable variance in losses and gains on valuation and
    translation of financial instruments; 
 
--  $25.2 million increase in adjusted operating income; 
 
--  $8.7 million favourable variance in losses on debt refinancing; 
 
--  $8.0 million decrease in financial expenses. 

Partially offset by:  


 
 
--  $15.3 million unfavourable variance in charge for restructuring of
    operations, impairment of assets and other special items; 
 
--  $3.2 million increase in amortization charge. 

Adjusted income from continuing operations: $68.0 million in the fourth
quarter of 2013 ($0.55 per basic share), compared with $52.3 million
($0.42 per basic share) in the same period of 2012, an increase of
$15.7 million ($0.13 per basic share). 
Financing activities  
The following financial operations were carried out in 2013. 


 
 
--  On June 17, 2013, Videotron announced the closing of the offering and
    sale of 5.625% Senior Notes, maturing on June 15, 2025, in the aggregate
    principal amount of $400.0 million, for net proceeds of $394.8 million.
    Strong demand enabled Videotron to increase the size of the placement on
    favourable terms. 
 
--  On July 2, 2013, Videotron used the proceeds from its placement of
    5.625% Senior Notes maturing on June 15, 2025 to finance the early
    redemption and withdrawal of US$380.0 million aggregate principal amount
    of its outstanding 9.125% Senior Notes, issued on April 15, 2008 and
    maturing in April 2018, and to settle the related hedges. 
 
--  On August 14, 2013, the Corporation carried out a two-for-one split of
    its outstanding Class A Multiple Voting Shares ("Class A Shares") and
    Class B Subordinate Voting Shares ("Class B Shares"). Accordingly,
    shareholders received one additional share for each share owned on the
    record date. Trading on the shares on a split basis commenced at the
    opening of business on August 16, 2013. 
 
--  On August 29, 2013, Quebecor Media issued a US$350 million senior
    secured term loan "B" at a price of 99.50% for net proceeds of $358.4
    million. This term loan bears interest at the U.S. London Interbank
    Offered Rate ("LIBOR"), subject to a LIBOR floor of 0.75%, plus a
    premium of 2.50%. It provides for quarterly amortization payments
    totalling 1.00% per annum of the original principal amount, with the
    balance payable on August 17, 2020. 
 
--  On August 30, 2013, Quebecor Media redeemed US$265.0 million in
    aggregate principal amount of its outstanding 7.75% Senior Notes issued
    on January 17, 2006 and due in March 2016, and settled the related
    hedging contracts. 
 
--  In October 2013, the Corporation amended its $150.0 million revolving
    credit facility to extend the maturity date to November 2016 and amend
    certain terms and conditions. 

Dividends  
On March 12, 2014, the Board of Directors of Quebecor declared a
quarterly dividend of $0.025 per share on its Class A Shares and
Class B Shares, payable on April 22, 2014 to shareholders of record
at the close of business on March 28, 2014. This dividend is
designated to be an eligible dividend, as provided under subsection
89(14) of the Canadian Income Tax Act and its provincial counterpart. 
Normal course issuer bid  
On August 8, 2013, the Corporation filed a normal course issuer bid
for a maximum of 1,956,068 Class A shares, representing approximately
5% of issued and outstanding Class A shares, and for a maximum of
8,429,248 Class B shares, representing approximately 10% of the
public float of Class B shares as of July 31, 2013. The purchases can
be made from August 13, 2013 to August 12, 2014 at prevailing market
prices on the open market through the facilities of the Toronto Stock
Exchange. All shares purchased under the bid will be cancelled.  
In 2013, the Corporation purchased and cancelled 1,603,700 Class B
shares for a total cash consideration of $36.4 million (2,117,600
Class B shares for a total cash consideration of $38.3 million in
2012). The excess of $30.2 million of the purchase price over the
carrying value of Class B shares repurchased was recorded in
reduction of retained earnings in 2013 ($30.3 million in 2012). 
Detailed financial information  
For a detailed analysis of Quebecor's fourth quarter and full year
2013 results, please refer to the Management Discussion and Analysis
and consolidated financial statements of Quebecor, available on the
Corporation's website at
www.quebecor.com/en/quarterly_doc_quebecor_inc or from the SEDAR
filing service at www.sedar.com.  
Conference call for investors and Webcast  
Quebecor will hold a conference call to discuss its fourth quarter
2013 results on March 13, 2014, at 11:00 a.m. EDT. There will be a
question period reserved for financial analysts. To access the
conference call, please dial 1 877 293-8052, access code for
participants 16546#. A tape recording of the call will be available
from March 13 to June 13, 2014 by dialling 1 877 293-8133, conference
number 1151195, access code for participants 16546#. The conference
call will also be webcast live on Quebecor's web site at
www.quebecor.com/en/content/conference-call. It is advisable to
ensure the appropriate software is installed before accessing the
call. Instructions and links to free player downloads are available
at the Internet address shown above.  
Cautionary statement regarding forward-looking statements  
The statements in this press release that are not historical facts
are forward-looking statements and are subject to significant known
and unknown risks, uncertainties and assumptions that 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 may be identified by the use of the
conditional or by forward-looking terminology such as the terms
"plans," "expects," "may," "anticipates," "intends," "estimates,"
"projects," "seeks," "believes," or similar terms, variations of such
ter
ms or the negative of such terms. Certain factors that may cause
actual results to differ from current expectations include
seasonality (including seasonal fluctuations in customer orders),
operating risk (including fluctuations in demand for Quebecor's
products and pricing actions by competitors), insurance risk, risks
associated with capital investment (including risks related to
technological development and equipment availability and breakdown),
environmental risks, risks associated with labour agreements, risks
associated with commodities and energy prices (including fluctuations
in the cost and availability of raw materials), credit risk,
financial risks, debt risks, risks related to interest rate
fluctuations, foreign exchange risks, risks associated with
government acts and regulations, risks related to changes in tax
legislation, and changes in the general political and economic
environment. 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 Quebecor's actual results to differ from
current expectations, please refer to Quebecor's public filings
available at www.sedar.com and www.quebecor.com, including in
particular the "Risks and Uncertainties" section of Quebecor's
Management Discussion and Analysis for the year ended December 31,
2013.  
The forward-looking statements in this press release reflect
Quebecor's expectations as of March 13, 2014 and are subject to
change after that date. Quebecor 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,
except as required by applicable securities laws.  
The Corporation  
Quebecor, a Canadian telecommunications, entertainment and news media
leader, is one of the best-performing integrated communications
companies in the industry. Driven by their determination to deliver
the best possible customer experience, all of Quebecor's subsidiaries
and brands are differentiated by their high-quality, multiplatform,
convergent products and services.  
Quebecor (TSX: QBR.A)(TSX: QBR.B) is firmly based in Quebec. It holds
a 75.36% interest in Quebecor Media, which employs nearly 16,000
people in Canada.  
A family business founded in 1950, Quebecor is strongly committed to
the community. Every year, it actively supports people working with
more than 400 organizations in the vital fields of culture, health,
education, the environment, and entrepreneurship.  
Visit our Web site: www.quebecor.com  
Follow us on Twitter: twitter.com/QuebecorMedia  
DEFINITIONS  
Adjusted Operating Income  
In its analysis of operating results, the Corporation defines
adjusted operating income, as reconciled to net (loss) income under
IFRS, as net (loss) income before amortization, financial expenses,
(loss) gain on valuation and translation of financial instruments,
charge for restructuring of operations, impairment of assets and
other special items, charge for impairment of goodwill and intangible
assets, loss on debt refinancing, income taxes, and income (loss)
from discontinued operations. Adjusted operating income as defined
above is not a measure of results that is consistent with IFRS. It is
not intended to be regarded as an alternative to other financial
operating performance measures or to the statement of cash flows as a
measure of liquidity. It should not be considered in isolation or as
a substitute for measures of performance prepared in accordance with
IFRS. The Corporation uses adjusted operating income in order to
assess the performance of its investment in Quebecor Media. The
Corporation's management and Board of Directors use this measure in
evaluating its consolidated results as well as the results of the
Corporation's operating segments. This measure eliminates the
significant level of impairment and amortization of tangible and
intangible assets and is unaffected by the capital structure or
investment activities of the Corporation and its segments.  
Adjusted operating income is also relevant because it is a
significant component of the Corporation's annual incentive
compensation programs. A limitation of this measure, however, is that
it does not reflect the periodic costs of tangible and intangible
assets used in generating revenues in the Corporation's segments. The
Corporation also uses other measures that do reflect such costs, such
as cash flows from segment operations and free cash flows from
continuing operating activities of the Quebecor Media subsidiary. In
addition, measures like adjusted operating income are commonly used
by the investment community to analyze and compare the performance of
companies in the industries in which the Corporation is engaged. The
Corporation's definition of adjusted operating income may not be the
same as similarly titled measures reported by other companies.  
Table 2 below provides a reconciliation of adjusted operating income
to net (loss) income as disclosed in Quebecor's consolidated
financial statements. The consolidated financial information for the
three-month periods ended December 31, 2013 and 2012 presented in
Table 2 below is drawn from the unaudited consolidated statements of
income. 


 
 
Table 2                                                                     
Reconciliation of the adjusted operating income measure used in this press  
release to the net (loss) income measure used in the consolidated financial 
statements                                                                  
(in millions of Canadian dollars)                                           
 
                                                              Three months  
                               Year ended December 31     ended December 31 
------------------------------------------------------------------------
----
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                           2013       2012       2011       2013       2012 
----------------------------------------------------------------------------
 
Adjusted operating                                                          
 (loss) income:                                                             
  Telecommunications $  1,284.8 $  1,203.7 $  1,073.6 $    322.4 $    304.8 
  News Media               97.7      105.1      142.5       44.6       37.4 
  Broadcasting             45.4       33.4       47.3       16.7       15.1 
  Leisure and                                                               
   Entertainment           16.6       25.1       38.3        7.5        8.6 
  Interactive                                                               
   Technologies and                                                         
   Communications          14.4        9.8        7.9        4.8        3.4 
  Head Office              (7.1)       3.9        9.2       (4.7)      (3.2)
----------------------------------------------------------------------------
                        1,451.8    1,381.0    1,318.8      391.3      366.1 
Amortization             (664.8)    (597.5)    (510.4)    (169.9)    (166.7)
Financial expenses       (376.7)    (346.3)    (331.7)     (90.9)     (98.9)
(Loss) gain on                                                              
 valuation and                                                              
 translation of                                                             
 financial                                                                  
 instruments             (238.8)     136.1       52.0      (29.2)     (95.7)
Restructuring of                                                            
 operations,                                                                
 impairment of assets                                                       
 and other special                                                          
 items                    (29.9)     (28.5)     (29.3)     (16.0)      (0.7)
Impairment of                                                               
 goodwill and                                                               
 intangible assets       (281.3)    (186.0)         -          -          - 
Loss on debt                                                                
 refinancing              (18.9)      (6.3)      (4.0)         -       (8.7)
Income taxes              (26.7)     (93.5)    (136.4)     (25.2)       8.4 
Income (loss) from                                                          
 discontinued                                                               
 operations                19.3       (3.7)      14.8        2.4        2.4 
----------------------------------------------------------------------------
Net (loss) income    $   (166.0)$    255.3 $    373.8 $     62.5 $      6.2 
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Adjusted income from continuing operations  
The Corporation defines adjusted income from continuing operations,
as reconciled to net (loss) income attributable to shareholders under
IFRS, as net (loss) income attributable to shareholders before (loss)
gain on valuation and translation of financial instruments, charge
for restructuring of operations, impairment of assets and other
special items, charge for impairment of goodwill and intangible
assets, loss on debt refinancing, net of income tax related to
adjustments, net (loss) income attributable to non-controlling
interests related to adjustments, and (loss) income from discontinued
operations attributable to shareholders. Adjusted income from
continuing operations, as defined above, is not a measure of results
that is consistent with IFRS. It should not be considered in
isolation or as a substitute for measures of performance prepared in
accordance with IFRS. The Corporation uses adjusted income from
continuing operations to analyze trends in the performance of its
businesses. The above-listed items are excluded from the calculation
of this measure because they impair the comparability of the
financial results. Adjusted income from continuing operations is more
representative for the purpose of forecasting income. In addition,
this measure is commonly used by the investment community to analyze
and compare corporate performance. The Corporation's definition of
adjusted income from continuing operations may not be identical to
similarly titled measures reported by other companies.  
Table 3 provides a reconciliation of adjusted income from continuing
operations to net (loss) income attributable to shareholders used in
Quebecor's consolidated financial statements.  


 
 
Table 3                                                                     
Reconciliation of the adjusted income from continuing operations measure    
used in this report to the net (loss) income attributable to shareholders   
measure used in the consolidated financial statements                       
(in millions of Canadian dollars)                                           
 
                                                              Three months  
                               Year ended December 31     ended December 31 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                         2013       2012       2011       2013         2012 
----------------------------------------------------------------------------
 
Adjusted income                                                             
 from continuing                                                            
 operations        $    214.1 $    182.3 $    178.4 $     68.0   $     52.3 
(Loss) gain on                                                              
 valuation and                                                              
 translation of                                                             
 financial                                                                  
 instruments           (238.8)     136.1       52.0      (29.2)       (95.7)
Restructuring of                                                            
 operations.                                                                
 impairment of                                                              
 assets and other                                                           
 special items          (29.9)     (28.5)     (29.3)     (16.0)        (0.7)
Impairment of                                                               
 goodwill and                                                               
 intangible                                                                 
 assets                (281.3)    (186.0)         -          -            - 
Loss on debt                                                                
 refinancing            (18.9)      (6.3)      (4.0)         -         (8.7)
Income taxes                                                                
 related to                                                                 
 adjustments(1)          84.9       24.1       (4.0)       9.5         31.2 
Net income (loss)                                                           
 attributable to                                                            
 non-controlling                                                            
 interest related                                                           
 to adjustments         121.5       41.1       (4.8)       9.6         27.1 
Discontinued                                                                
 operations              14.5       (1.7)       8.1        1.5          1.6 
----------------------------------------------------------------------------
Net (loss) income                                                           
 attributable to                                                            
 shareholders      $   (133.9)$    161.1 $    196.4 $     43.4   $      7.1 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
  (1)Includes impact of fluctuations in income tax applicable to adjusted   
     items, either for statutory reasons or in connection with tax          
     transactions.                                                          

Average Monthly Revenue per User  
ARPU is an industry metric that the Corporation uses to measure its
monthly cable television, Internet access, cable and mobile telephony
revenues per average basic cable customer. ARPU is not a measurement
that is consistent with IFRS and the Corporation's definition and
calculation of ARPU may not be the same as identically titled
measureme
nts reported by other companies. The Corporation calculates
ARPU by dividing its combined cable television, Internet access, and
cable and mobile telephony revenues by the average number of basic
customers during the applicable period, and then dividing the
resulting amount by the number of months in the applicable
period. 


 
 
QUEBECOR INC. AND ITS SUBSIDIARIES                                          
CONSOLIDATED STATEMENTS OF INCOME                                           
 
(in millions of Canadian                                                    
 dollars, except for                                                        
 earnings per share data)       Three months ended      Twelve months ended 
(unaudited)                            December 31              December 31 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                 2013         2012       2013          2012 
----------------------------------------------------------------------------
                                        (restated)               (restated) 
 
Revenues                    $ 1,123.4 $    1,117.7  $ 4,277.2  $    4,248.9 
Employee costs                  242.5        259.1    1,004.8       1,025.9 
Purchase of goods and                                                       
 services                       489.6        492.5    1,820.6       1,842.0 
Amortization                    169.9        166.7      664.8         597.5 
Financial expenses               90.9         98.9      376.7         346.3 
Loss (gain) on valuation                                                    
 and translation of                                                         
 financial instruments           29.2         95.7      238.8        (136.1)
Restructuring of                                                            
 operations, impairment of                                                  
 assets and other special                                                   
 items                           16.0          0.7       29.9          28.5 
Impairment of goodwill and                                                  
 intangible assets                  -            -      281.3         186.0 
Loss on debt refinancing            -          8.7       18.9           6.3 
                           -------------------------------------------------
Income (loss) before income                                                 
 taxes                           85.3         (4.6)    (158.6)        352.5 
Income taxes (recovery):                                                    
  Current                        10.1         20.8       95.4          57.0 
  Deferred                       15.1        (29.2)     (68.7)         36.5 
                           -------------------------------------------------
                                 25.2         (8.4)      26.7          93.5 
                           -------------------------------------------------
 
Income (loss) from                                                          
 continuing operations           60.1          3.8     (185.3)        259.0 
Income (loss) from                                                          
 discontinued operations          2.4          2.4       19.3          (3.7)
                           -------------------------------------------------
Net income (loss)           $    62.5 $        6.2  $  (166.0) $      255.3 
                           -------------------------------------------------
                           -------------------------------------------------
Income (loss) from                                                          
 continuing operations                                                      
 attributable to                                                            
  Shareholders              $    41.9 $        5.5  $  (148.4) $      162.8 
  Non-c
ontrolling interests      18.2         (1.7)     (36.9)         96.2 
                           -------------------------------------------------
                           -------------------------------------------------
Net income (loss)                                                           
 attributable to                                                            
  Shareholders              $    43.4 $        7.1  $  (133.9) $      161.1 
  Non-controlling interests      19.1         (0.9)     (32.1)         94.2 
                           -------------------------------------------------
                           -------------------------------------------------
Earnings per share                                                          
 attributable to                                                            
 shareholders                                                               
  Basic                                                                     
    From continuing                                                         
     operations             $    0.34 $       0.04  $   (1.20) $       1.29 
    From discontinued                                                       
     operations                  0.01         0.02       0.12         (0.02)
    Net income (loss)            0.35         0.06      (1.08)         1.27 
  Diluted                                                                   
    From continuing                                                         
     operations                  0.28         0.03      (1.20)         1.24 
    From discontinued                                                       
     operations                  0.01         0.02       0.12         (0.02)
    Net income (loss)            0.29         0.05      (1.08)         1.22 
                           -------------------------------------------------
                           -------------------------------------------------
Weighted average number of                                                  
 shares outstanding (in                                                     
 millions)                      123.5        125.4      124.0         126.4 
Weighted average number of                                                  
 diluted shares (in                                                         
 millions)                      144.7        148.6      124.0         132.2 
                           -------------------------------------------------
                           -------------------------------------------------
 
QUEBECOR INC. AND ITS SUBSIDIARIES                                          
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME                             
 
(in millions of Canadian                                                    
 dollars)                        Three months ended     Twelve months ended 
(unaudited)                             December 31             December 31 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                  2013         2012       2013         2012 
----------------------------------------------------------------------------
                                         (restated)              (restated) 
 
Net income (loss)            $    62.5  $       6.2  $  (166.0) $     255.3 
Other comprehensive income                                                  
 (loss):                                                                    
  Items that may be                                                         
   reclassified to income:                                                  
    Gain (loss) on                                                          
     translation of net                                                     
     investments in foreign                                                 
     operations                    2.1   
       2.3        4.4         (1.4)
    Cash flow hedges:                                                       
      (Loss) gain on                                                        
       valuation of                                                         
       derivative financial                                                 
       instruments                (5.8)         1.9      (45.1)        33.1 
      Deferred income taxes       (2.5)         1.5       (1.2)         2.9 
  Items that will not be                                                    
   reclassified to income:                                                  
    Defined benefit plans:                                                  
      Re-measurement gain                                                   
       (loss)                     22.4        (18.5)     141.4        (18.5)
      Deferred income taxes       (5.5)         4.9      (37.5)         4.9 
  Reclassification to                                                       
   income:                                                                  
    Gain related to cash                                                    
     flow hedges                     -        (12.0)     (14.5)       (15.3)
    Deferred income taxes            -          1.7        1.1          0.5 
                            ------------------------------------------------
                                  10.7        (18.2)      48.6          6.2 
                            ------------------------------------------------
Comprehensive income (loss)  $    73.2  $     (12.0) $  (117.4) $     261.5 
                            ------------------------------------------------
                            ------------------------------------------------
Comprehensive income (loss)                                                 
 attributable to                                                            
  Shareholders               $    48.5  $      (5.2) $  (106.7) $     162.2 
  Non-controlling interests       24.7         (6.8)     (10.7)        99.3 
                            ------------------------------------------------
                            ------------------------------------------------
 
QUEBECOR INC. AND ITS SUBSIDIARIES                                          
SEGMENTED INFORMATION                                                       
 
(in millions of Canadian dollars)                                           
(unaudited)                                                                 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
                                        Three months ended December 31, 2013
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
                                                                     Leisure
                                                                         and
                              Telecommu-        News      Broad-      Enter-
                               nications       Media     casting    tainment
----------------------------------------------------------------------------
 
Revenues                     $     693.2   $   204.5   $   123.7   $    93.7
Employee costs                      94.5        57.1        32.7        15.1
Purchase of goods and                                                       
 services                          276.3       102.8        74.3        71.1
----------------------------------------------------------------------------
Adjusted operating                                                          
 income(1)                         322.4        44.6        16.7         7.5
 
Amortization                                                                
Financial expenses                                                          
Loss on valuation and                                                       
 translation of financial                                                   
 instruments                                                                
Restructuring of                                                            
 operations, impairment of                                                  
 assets and other special                                                   
 items                                                                      
----------------------------------------------------------------------------
Income before income taxes                                                  
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
Additions to property,                                                      
 plant and equipment         $     134.4   $     1.5   $     4.6   $     1.0
Additions to intangible                                                     
 assets                             14.9         1.5         1.3         0.6
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
QUEBECOR INC. AND ITS SUBSIDIARIES                                          
SEGMENTED INFORMATION                                                       
 
(in millions of Canadian dollars)                                           
(unaudited)                                                                 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
                                        Three months ended December 31, 2013
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                               Interactive                                  
                                   Techno-            Head                  
                                logies and          office                  
                                  Communi-      and Inter-                  
                                   cations        segments             Total
----------------------------------------------------------------------------
 
Revenues                     $        34.3   $       (26.0)   $      1,123.4
Employee costs                        20.8            22.3             242.5
Purchase of goods and                                                       
 services                              8.7           (43.6)            489.6
----------------------------------------------------------------------------
Adjusted operating                                                          
 income(1)                             4.8            (4.7)            391.3
 
Amortization                                                           169.9
Financial expenses                                                      90.9
Loss on valuation and                                                       
 translation of financial                                                   
 instruments                                                            29.2
Restructuring of                                                            
 operations, impairment of                                                  
 assets and other special                                                   
 items                                                                  16.0
----------------------------------------------------------------------------
Income before income taxes                                    $         85.3
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
Additions to property,                                                      
 plant and equipment         $         0.4   $         1.2    $        143.1
Additions to intangible                                                     
 assets                                0.1            (0.2)             18.2
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
                                        Three months ended December 31, 2012
                                                                  (restated)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
                                                                     Leisure
                                                                         and
                              Telecommu-        News      Broad-      Enter-
                               nications       Media     casting    tainment
----------------------------------------------------------------------------
 
Revenues                     $     668.6   $   222.7   $   129.6   $    94.5
Employee costs                      95.5        70.8        38.5        15.1
Purchase of goods and                                                       
 services                          268.3       114.5        76.0        70.8
----------------------------------------------------------------------------
Adjusted operating                                                          
 income(1)                         304.8        37.4        15.1         8.6
 
Amortization                                                                
Financial expenses                                                          
Loss on valuation and                                                       
 translation of financial                                                   
 instruments                                                                
Restructuring of                                                            
 operations, impairment of                                                  
 assets and other special                                                   
 items                                                                      
Loss on debt refinancing                                                    
----------------------------------------------------------------------------
Loss before income taxes                                                    
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
Additions to property,                                                      
 plant and equipment         $     150.1   $     0.7   $     4.3   $     2.7
Additions to intangible                                                     
 assets                             3
2.0         2.4         1.4         0.8
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
                                       Three months ended December 31, 2012 
                                                                 (restated) 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                               Interactive                                  
                                   Techno-           Head                   
                                logies and         office                   
                                  Communi-     and Inter-                   
                                   cations       segments             Total 
----------------------------------------------------------------------------
 
Revenues                     $        35.8   $      (33.5)   $      1,117.7 
Employee costs                        20.5           18.7             259.1 
Purchase of goods and                                                       
 services                             11.9          (49.0)            492.5 
----------------------------------------------------------------------------
Adjusted operating                                                          
 income(1)                             3.4           (3.2)            366.1 
 
Amortization                                                          166.7 
Financial expenses                                                     98.9 
Loss on valuation and                                                       
 translation of financial                                                   
 instruments                                                           95.7 
Restructuring of                                                            
 operations, impairment of                                                  
 assets and other special                                                   
 items                                                                  0.7 
Loss on debt refinancing                                                8.7 
----------------------------------------------------------------------------
Loss before income taxes                                     $         (4.6)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
Additions to property,                                                      
 plant and equipment         $         1.2   $       (0.2)   $        158.8 
Additions to intangible                                                     
 assets                                  -           (0.8)             35.8 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 (1) The Chief Executive Officer uses adjusted operating income as the      
measure of profit to assess the performance of each segment. Adjusted       
operating income is referred as a non-IFRS measure and is defined as net    
income (loss) before amortization, financial expenses, loss (gain) on       
valuation and translation of financial instruments, restructuring of        
operations, impairment of assets and other special items, impairment of     
goodwill and intangible assets, loss on debt refinancing, income taxes and  
income (loss) from discontinued operations.                                 
 
QUEBECOR INC. AND ITS SUBSIDIARIES                                          
SEGMENTED INFORMATION (continued)                                           
(in millions of Canadian dollars)                                           
(unaudited)                                                                 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
                                       Twelve months ended December 31, 2013
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
                                                                     Leisure
                                                                         and
                                Telecommu-        News    Broad-      Enter-
                                 nications       Media   casting    tainment
----------------------------------------------------------------------------
 
Revenues                     $     2,711.8   $   784.2 $   458.9   $   298.9
Employee costs                       370.5       266.0     141.6        58.9
Purchase of goods and                                                       
 services                          1,056.5       420.5     271.9       223.4
----------------------------------------------------------------------------
Adjusted operating                                                          
 income(1)                         1,284.8        97.7      45.4        16.6
 
Amortization                                                                
Financial expenses                                                          
Loss on valuation and                                                       
 translation of financial                                                   
 instruments                                                                
Restructuring of                                                            
 operations, impairment of                                                  
 assets and other special                                                   
 items                                                                      
Impairment of goodwill and                                                  
 
intangible assets                                                          
Loss on debt refinancing                                                    
----------------------------------------------------------------------------
Loss before income taxes                                                    
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
Additions to property,                                                      
 plant and equipment         $       546.8   $    10.0 $    21.7   $     3.0
Additions to intangible                                                     
 assets                               51.6         7.4       3.1         4.4
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
QUEBECOR INC. AND ITS SUBSIDIARIES                                          
SEGMENTED INFORMATION (continued)                                           
(in millions of Canadian dollars)                                           
(unaudited)                                                                 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
                                      Twelve months ended December 31, 2013 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                               Interactive                                  
                                   Techno-            Head                  
                                logies and          office                  
                                  Communi-      and Inter-                  
                                   cations        segments            Total 
----------------------------------------------------------------------------
 
Revenues                     $       139.2   $      (115.8)   $     4,277.2 
Employee costs                        91.2            76.6          1,004.8 
Purchase of goods and                                                       
 services                             33.6          (185.3)         1,820.6 
----------------------------------------------------------------------------
Adjusted operating                                                          
 income(1)                            14.4            (7.1)         1,451.8 
 
Amortization                                                          664.8 
Financial expenses                                                    376.7 
Loss on valuation and                                                       
 translation of financial                                                   
 instruments                                                          238.8 
Restructuring of                                                            
 operations, impairment of                                                  
 assets and other special                                                   
 items                                                                 29.9 
Impairment of goodwill and                                                  
 intangible assets                                                    281.3 
Loss on debt refinancing                                               18.9 
----------------------------------------------------------------------------
Loss before income taxes                                      $      (158.6)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
Additions to property,                                                      
 plant and equipment         $         1.7   $         2.7    $       585.9 
Additions to intangible                                                     
 assets                                0.2            (0.6)            66.1 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 

 
 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                       Twelve months ended December 31, 2012
                                                                  (restated)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
                                                                     Leisure
                                                                         and
                              Telecommu-        News      Broad-      Enter-
                               nications       Media     casting    tainment
----------------------------------------------------------------------------
 
Revenues                  $      2,597.8   $   875.5   $   457.6   $   311.6
Employee costs                     359.3       312.7       153.8        58.2
Purchase of goods and                                                       
 services                        1,034.8       457.7       270.4       228.3
----------------------------------------------------------------------------
Adjusted operating                                                          
 income(1)                       1,203.7       105.1        33.4        25.1
 
Amortization                                                                
Financial expenses                                                          
Gain on valuation and                                                       
 translation of financial                                                   
 instruments                                                                
Restructuring of                                                            
 operations, impairment of                                                  
 assets and other special                                                   
 items                                                                      
Impairment of goodwill and                                                  
 intangible assets                                                          
Loss on debt refinancing                                                    
----------------------------------------------------------------------------
Income before income taxes                                                  
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
Additions to property,                                                      
 plant and equipment      $        669.5   $     5.7   $    22.2   $     6.4
Additions to intangible                                                     
 assets                             75.9        11.6         3.6         5.0
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                      Twelve months ended December 31, 2012 
                                                                 (restated) 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                               Interactive                                  
                                   Techno-             Head                 
                                logies and           office                 
                                  Communi-       and Inter-                 
                                   cations         segments           Total 
----------------------------------------------------------------------------
 
Revenues                     $       145.5   $       (139.1)   $    4,248.9 
Employee costs                        89.3             52.6         1,025.9 
Purchase of goods and                                                       
 services                             46.4           (195.6)        1,842.0 
----------------------------------------------------------------------------
Adjusted operating                                                          
 income(1)                             9.8              3.9         1,381.0 
 
Amortization                                                          597.5 
Financial expenses                                                    346.3 
Gain on valuation and                              
                         
 translation of financial                                                   
 instruments                                                         (136.1)
Restructuring of                                                            
 operations, impairment of                                                  
 assets and other special                                              28.5 
 items                                                                      
Impairment of goodwill and                                                  
 intangible assets                                                    186.0 
Loss on debt refinancing                                                6.3 
----------------------------------------------------------------------------
Income before income taxes                                     $      352.5 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
Additions to property,                                                      
 plant and equipment         $         4.2   $          1.9    $      709.9 
Additions to intangible                                                     
 assets                                  -             (2.2)           93.9 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) The Chief Executive Officer uses adjusted operating income as the       
measure of profit to assess the performance of each segment. Adjusted       
operating income is referred as a non-IFRS measure and is defined as net    
income (loss) before amortization, financial expenses, loss (gain) on       
valuation and translation of financial instruments, restructuring of        
operations, impairment of assets and other special items, impairment of     
goodwill and intangible assets, loss on debt refinancing, income taxes and  
income (loss) from discontinued operations.                                 
 

 
 
QUEBECOR INC. AND ITS SUBSIDIARIES                                          
CONSOLIDATED STATEMENTS OF EQUITY                                           
 
(in millions of Canadian dollars)                                           
(unaudited)                                                                 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
                                        Equity attributable to shareholders 
                ------------------------------------------------------------
 
                                             Equity             Accumulated 
                                          component              other com- 
                 Capital Contributed of convertible  Retained    prehensive 
                   stock     surplus     debentures  earnings income (loss) 
----------------------------------------------------------------------------
 
Balance as of                                                               
 December 31,                                                               
 2011,as                                                                    
 previously                                                                 
 reported         $339.5   $     0.9   $          -  $1,077.2   $       8.6 
Changes in                                                                  
 accounting                                                                 
 policies              -           -              -      48.4         (49.6)
----------------------------------------------------------------------------
Balance as of                                                               
 December 31,                                                               
 2011, as                                                                   
 restated          339.5         0.9              -   1,125.6         (41.0)
Net income             -           -              -     161.1             - 
Other                                                                       
 comprehensive                                                              
 income                -           -              -         -           1.1 
Issuance of                                                                 
 shares of a                                                                
 subsidiary          3.6         1.5              -         -             - 
Repurchase of                                                               
 Class B Shares     (8.0)          -              -     (30.3)            - 
Acquisition of                                                              
 non-controlling                                                            
 interests             -        (0.1)             -    (619.2)        (10.4)
Issuance of                                                                 
 convertible                                                                
 debentures            -           -          398.3         -             - 
Dividends              -           -              -     (12.6)            - 
----------------------------------------------------------------------------
Balance as of                                                               
 December 31,                                                               
 2012              335.1         2.3          398.3     624.6         (50.3)
Net loss               -           -              -    (133.9)            - 
Other                                                                       
 comprehensive                                                              
 income                -           -              -         -          27.2 
Repurchase of                                                               
 Class B Shares     (6.2)          -              -     (30.2)            - 
Dividends              -           -              -     (12.4)            - 
Business                                                                    
 acquisition           -           -              -         -             - 
----------------------------------------------------------------------------
Balance as of                                                               
 December 31,                                                               
 2013             $328.9   $     2.3   $      398.3  $  448.1   $     (23.1)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
QUEBECOR INC. AND ITS SUBSIDIARIES                   
CONSOLIDATED STATEMENTS OF EQUITY                    
 
(in millions of Canadian dollars)                    
(unaudited)                                          
-----------------------------------------------------
-----------------------------------------------------
 
                               Equity                
                         attributable                
                              to non-                
                          controlling          Total 
                            interests         equity 
-----------------------------------------------------
 
Balance as of                                        
 December 31,                                        
 2011,as                                             
 previously                                          
 reported            $        1,444.4    $   2,870.6 
Changes in                                           
 accounting                                          
 policies                        (1.5)          (2.7)
-----------------------------------------------------
Balance as of                                        
 December 31,                                        
 2011, as                                            
 restated                     1,442.9        2,867.9 
Net income                       94.2          255.3 
Other                                                
 comprehensive                                       
 income                           5.1            6.2 
Issuance of                                          
 shares of a                                         
 subsidiary                         -            5.1 
Repurchase of                                        
 Class B Shares                     -          (38.3)
Acquisition of                                       
 non-controlling                                     
 interests                     (870.3)      (1,500.0)
Issuance of                                          
 convertible                                         
 debentures                         -          398.3 
Dividends                       (40.6)         (53.2)
-----------------------------------------------------
Balance as of                                        
 December 31,                                        
 2012                           631.3        1,941.3 
Net loss                        (32.1)        (166.0)
Other                                                
 comprehensive                                       
 income                          21.4           48.6 
Repurchase of                                        
 Class B Shares                     -          (36.4)
Dividends                       (25.0)         (37.4)
Business                                             
 acquisition                      0.3            0.3 
-----------------------------------------------------
Balance as of                                        
 December 31,                                        
 2013                $          595.9    $   1,750.4 
-----------------------------------------------------
-----------------------------------------------------
 
QUEBECOR INC. AND ITS SUBSIDIARIES                                          
CONSOLIDATED STATEMENTS OF CASH FLOWS                                       
 
(in millions of Canadian                                                    
 dollars)                        Three months ended     Twelve months ended 
(unaudited)                             December 31             December 31 
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                                  2013         2012       2013         2012 
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                                         (restated)              (restated) 
Cash flows related to                                                       
 operating activities                                                       
  Income (loss) from                                                        
   continuing operations     $    60.1  $       3.8  $  (185.3) $     259.0 
  Adjustments for:                                                          
    Amortization of                                                         
     property, plant and                                                    
     equipment                   136.3        128.3      523.4        458.9 
    Amortization of                                                         
     intangible assets            33.6         38.4      141.4        138.6 
    Loss (gain) on                                                          
     valuation and                                                          
     translation of                                                         
     financial instruments        29.2         95.7      238.8       (136.1)
    Gain on disposal of                                                     
     assets                          -            -          -        (12.9)
    Impairment of assets           0.9            -        3.2          7.5 
    Impairment of goodwill                                                  
     and intangible assets           -            -      281.3        186.0 
    Loss on debt                                                            
     refinancing                     -          8.7       18.9          6.3 
    Amortization of                                                         
     financing costs and                                                    
     long-term debt                                                         
     discount                      2.9          3.6       12.0         14.5 
    Deferred income taxes         15.1        (29.2)     (68.7)        36.5 
    Other                         (0.5)         4.5       (0.4)         3.9 
                          --------------------------------------------------
                                 277.6        253.8      964.6        962.2 
  Net change in non-cash                                                    
   balances related to                                                      
   operating activities           35.7         20.7      (50.4)       141.2 
                          --------------------------------------------------
Cash flows provided by                                                      
 continuing operating                                                       
 activities                      313.3        274.5      914.2      1,103.4 
                          --------------------------------------------------
Cash flows related to                                                       
 investing activities                                                       
  Non-controlling                                                           
   interests acquisition             -     (1,000.0)         -     (1,000.0)
  Business acquisitions           (6.5)        (1.2)     (15.0)        (2.0)
  Business disposals               7.1            -       59.2          0.8 
  Additions to property,                                                    
   plant and equipment          (143.1)      (158.8)    (585.9)      (709.9)
  Additions to intangible                                                   
   assets                        (18.2)       (35.8)     (66.1)       (93.9)
  Proceeds from disposals                                                   
   of assets                       5.1          2.3       19.5         29.4 
  Other                            1.1         (0.9)       1.7         (1.5)
                          --------------------------------------------------
Cash flows used in                                                          
 continuing investing                                                       
 activities                     (154.5)    (1,194.4)    (586.6)    (1,777.1)
                          --------------------------------------------------
Cash flows related to                                                       
 financing activities                                                       
  Net change in bank                                                        
   indebtedness                   (0.7)        (0.2)      (0.8)        (2.9)
  Net change under                                                          
   revolving facilities           (6.9)       (11.2)         -        (23.6)
  Issuance of long-term                                                     
   debt, net of financing                                                   
   fees                           (0.6)     1,314.2      752.6      2,136.7 
  Repayments of long-term                                                   
   debt                           (6.4)      (487.5)    (723.6)    (1,236.8)
  Repayment of liability                                                    
   component of                                                             
   convertible debentures         (6.8)           -      (13.5)           - 
  Settlement of hedging                                                     
   contracts                      (2.0)        (3.1)     (29.7)       (43.6)
  Issuance of Class B                                                       
   Shares                            -            -          -          3.6 
  Repurchase of Class B                                                     
   Shares                         (4.9)       (12.5)     (36.4)       (38.3)
  Dividends                       (3.1)        (3.1)     (12.4)       (12.6)
  Dividends paid to non-                                                    
   controlling                                                              
   shareholders                   (6.4)        (6.5)     (25.0)       (40.6)
  Other                              -         (0.3)         -         (0.3)
                          --------------------------------------------------
Cash flows (used in)                                                        
 provided by continuing                                                     
 financing activities            (37.8)       789.8      (88.8)       741.6 
                          --------------------------------------------------
Net change in cash and                                                      
 cash equivalents from                                                      
 continuing operations           121.0       (130.1)     238.8         67.9 
Cash flows provided by                                                      
 discontinued operations           1.3          3.7        7.9         17.3 
Effect of exchange rate                                                     
 changes on cash and cash                                                   
 equivalents denominated                                                    
 in foreign currencies             0.7          0.5        1.2            - 
Cash and cash equivalents                                                   
 at beginning of period          353.6        354.6      228.7        143.5 
                          --------------------------------------------------
Cash and cash equivalents                                                   
 at end of period            $   476.6  $     228.7  $   476.6  $     228.7 
                          --------------------------------------------------
                          --------------------------------------------------
 
Cash and cash equivalents                                                   
 consist of                                                                 
  Cash                       $   207.3  $      76.0  $   207.3  $      76.0 
  Cash equivalents               269.3        152.7      269.3        152.7 
                          --------------------------------------------------
                             $   476.6  $     228.7  $   476.6  $     228.7 
                          --------------------------------------------------
                          --------------------------------------------------
 
Interest and taxes                                                          
 reflected as operating                                                     
 activities                                                                 
  Cash interest payments     $   136.9  $     137.3  $   348.4  $     305.6 
  Cash income tax payments                                                  
   (net of refunds)                2.7          0.6       49.6          6.6 
                          --------------------------------------------------
                          --------------------------------------------------
 

 
 
QUEBECOR INC. AND ITS SUBSIDIARIES                                          
CONSOLIDATED BALANCE SHEETS                                                 
 
(in millions of Canadian dollars)                                           
(unaudited)                                     December 31     December 31 
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                                                       2013            2012 
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                                                                 (restated) 
 
Assets                                                                      
 
Current assets                                                              
  Cash and cash equivalents                     $     476.6     $     228.7 
  Accounts receivable                                 566.3           578.7 
  Income taxes                                         18.0            10.6 
  Inventories                                         239.4           255.5 
  Prepaid expenses                                     48.2            38.0 
  Assets held for sale                                 76.9               - 
                                            --------------------------------
                                                    1,425.4         1,111.5 
Non-current assets                                                          
  Property, plant and equipment                     3,448.4         3,405.8 
  Intangible assets                                   808.8           956.7 
  Goodwill                                          3,061.5         3,371.6 
  Derivative financial instruments                    142.1            35.7 
  Deferred income taxes                                28.1            23.9 
  Other assets                                        102.1           102.6 
                                            --------------------------------
                                                    7,591.0         7,896.3 
                                            --------------------------------
Total assets                                    $   9,016.4     $   9,007.8 
                                            --------------------------------
                                            --------------------------------
Liabilities and equity                                                      
 
Current liabilities                                                         
  Bank indebtedness                             $       0.5     $       1.3 
  Accounts payable and accrued charges                717.7           804.5 
  Provisions                                           39.4            45.9 
  Deferred revenue                                    288.8           289.0 
  Income taxes                                         89.2            33.9 
  Derivative financial instruments                    116.2            28.5 
  Current portion of long-term debt                   101.2            22.2 
  Liabilities held for sale                             9.0               - 
                                            --------------------------------
                                                    1,362.0         1,225.3 
Non-current liabilities                                                     
  Long-term debt                                    4,975.3         4,507.8 
  Derivative financial instruments                     77.3           270.1 
  Other liabilities                                   278.7           469.2 
  Deferred income taxes                               572.7           594.1 
                                            --------------------------------
                                                    5,904.0         5,841.2 
Equity                                                                      
  Capital stock                                       328.9           335.1 
  Contributed surplus                                   2.3             2.3 
  Equity component of convertible debentures          398.3           398.3 
  Retained earnings                                   448.1           624.6 
  Accumulated other comprehensive loss                (23.1)          (50.3)
                                            --------------------------------
  Equity attributable to shareholders               1,154.5         1,310.0 
  Non-controlling interests                           595.9           631.3 
                                            --------------------------------
                                                    1,750.4         1,941.3 
                                            --------------------------------
Total liabilities and equity                    $   9,016.4     $   9,007.8 
                                            --------------------------------
                                            --------------------------------

  
Contacts:
Jean-Francois Pruneau
Senior Vice President and Chief Financial Officer
Quebecor Inc. and Quebecor Media Inc.
jean-francois.pruneau@quebecor.com
514 380-4144 
Martin Tremblay
Vice President, Public Affairs
Quebecor Media Inc.
martin.tremblay@quebecor.com
514 380-1985
 
 
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