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Category Investors Date 1/11/2006 |
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CanWest MediaWorks Income Fund Reports Solid Q1 Revenue Gains
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TORONTO /CNW/ - CanWest MediaWorks Income Fund (the "Fund") announces financial results for the three months ended November 30, 2005, the first quarter of its 2006 fiscal year for the Publications Group formerly owned by CanWest MediaWorks Inc. The Publications Group was acquired by CanWest MediaWorks Limited Partnership (the "Limited Partnership"), in which, effective October 13, 2005, the Fund acquired an approximate 26% interest.
The financial statements released today include the presentation of combined consolidated financial performance of the Publications Group for the period from September 1, 2005 to October 12, 2005, the time pre-dating the formation of the Limited Partnership, and the consolidated financial results of the Limited Partnership for the period from October 13, 2005 to November 30, 2005. The comparative period presented covers the combined consolidated financial results of the Publications Group for the three months ended November 30, 2004, the first quarter of the 2005 fiscal year.
Revenue for the three months ended November 30, 2005 was $313.6 million, a $14.6 million or 5% increase over the same period last year. Newspaper advertising revenue increased 4% with growth spread evenly across all categories. Significant growth in online classifieds more than offset a slight decline in print classifieds. Circulation revenue increased slightly with price increases more than offsetting a slight decline in number of copies sold. Dose and Metro also contributed to growth in newspaper revenue. Interactive revenue increased $1.7 million or 29% compared to prior year due to continued growth in online advertising.
EBITDA(1) for the first quarter was $82.3 million compared to $87.4 million for the same period last year. The EBITDA decline is attributable mainly to losses associated with Dose and Metro, which are in a development stage, higher payroll and distribution costs and strategic investments made in launching new online properties. The aggregate net earnings were $30.7 million in the first quarter compared to $20.9 million in the same quarter last year. The increase in earnings primarily reflects lower taxes due to the change in corporate structure to a Limited Partnership and lower financing costs.
Commenting on the results, Peter Viner, President and Chief Executive Officer of the Limited Partnership said, "We are pleased with the revenue growth achieved in the quarter thanks to the strong performance of the retail, national, online and insert advertising categories. These results were due in part to the success of initiatives geared towards increasing the product offering to our existing advertiser base. The free publications, Dose and Metro, continue to build their readership to levels anticipated prior to launch. Our priority in the coming period is to improve the year-over-year EBITDA through a combination of cost containment initiatives and expected revenue growth."
For the period from October 13, 2005, the date of the initial public offering of the Fund, to November 30, 2005, total revenue for the Limited Partnership was $174.9 million and total EBITDA was $51.3 million. Distributable cash for this period was $47.0 million or $0.2205 per unit. Cash distributions for the period totaled $0.1234 per unit. The excess of distributable cash over distributions for this period is the result of a lower level of capital expenditures and due to the seasonal nature of newspaper advertising revenue, which is highest during the first quarter of the fiscal year. Based on the first quarter results and current outlook, the Fund expects to maintain regular distributions of $0.925 per unit on an annualized basis and achieve a ratio of distributions to distributable cash of no greater than 95% for fiscal 2006. The Fund's declaration of trust requires that it distribute all taxable income earned up to December 31, 2005. Accordingly, in addition to the regular cash distribution in the period of $0.1234 per unit, a special year-end distribution of $0.02 per unit will be paid on January 16, 2006 to unitholders of record on December 31, 2005.
Commenting on the quarter, Doug Lamb, Executive Vice President and Chief Financial Officer of the Limited Partnership said, "This was a very busy quarter for us, in addition to completing our initial public offering, we were able to complete fixed rate interest swaps covering 100% of our term credit facility, and negotiate very attractive newsprint pricing arrangements covering the full 2006 calendar year. These initiatives along with our solid revenue growth and focus on cost containment position the fund for future growth of distributable cash."
This news release contains certain comments or forward-looking statements that are based largely upon the Company's current expectations and are subject to certain risks, trends and uncertainties. These factors could cause actual future performance to vary materially from current expectations.
CanWest MediaWorks Income Fund (TSX: CWM.UN; www.cwmincomefund.com) is an unincorporated, open-ended trust that holds an approximate 26% equity interest in CanWest MediaWorks Limited Partnership, which is the largest publisher of newspapers in Canada, as measured by paid circulation, readership and revenue.
The assets within the Limited Partnership comprise ten major metropolitan daily newspapers serving nine Canadian cities; Vancouver Sun, The Province (Vancouver), Ottawa Citizen, The Gazette (Montreal), The Edmonton Journal, Calgary Herald, The Windsor Star, Times-Colonist (Victoria), Leader Post (Regina), Star Phoenix (Saskatoon), Dose, a wholly owned free commuter daily, and a one-third interest in Metro Ottawa and Metro Vancouver, free commuter dailies, together with 23 smaller community daily, weekly and bi-weekly publications. The assets also include online properties canada.com, working.com and driving.ca and related websites.
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For further information: Doug Lamb, Executive Vice President and CFO, CanWest MediaWorks Limited Partnership, Tel: , Email:
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 Original Press Release Displaying Revenue Gains (179k) |
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