Highlights
- Revenues increased by $249.9 million, or 49.8%, from $501.7 million to $751.6 million, essentially as a result of the transformational acquisition of Coveris Americas, which contributed $306.0 million to revenues. This increase was partially mitigated by the accelerated recognition of deferred revenues of $39.8 million recorded in the first quarter of 2018 and the $19.5 million unfavourable effect of the sale of our California newspaper printing operations resulting from the agreement signed with Hearst. Adjusted revenues, which exclude the accelerated recognition of deferred revenues, increased by $289.7 million, or 62.7%, from $461.9 million to $751.6 million. Organic growth remained stable in the first quarter of 2019 compared to the corresponding period in 2018.
- Operating earnings decreased by $70.0 million, or 56.6%, from $123.6 million to $53.6 million, mainly as a result of the $39.8 million positive effect of the accelerated recognition of deferred revenue recorded in the first quarter of 2018 and the favourable impact of gains on the sale of certain activities amounting to $33.0 million in the first quarter of 2018. Adjusted operating earnings, which exclude the accelerated recognition of deferred revenues, accelerated depreciation, restructuring and other costs (gains), impairment of assets and amortization of intangible assets arising from business combinations, increased by $6.3 million, or 8.9%, from $70.4 million to $76.7 million.
- Net earnings decreased by $30.1 million, or 51.7%, from $58.2 million to $28.1 million. Adjusted net earnings, which exclude the accelerated recognition of deferred revenues, accelerated depreciation, restructuring and other costs (gains), impairment of assets and amortization of intangible assets arising from business combinations, net of related income taxes, as well as the impact of the U.S. tax reform on deferred taxes, decreased by $6.3 million, or 12.2%, from $51.8 million to $45.5 million.
- A sign of confidence in the Corporation's transformation, the Board of Directors approved a 4.8% increase in the annual dividend, bringing it to $0.88 per share.
Montréal, February 28, 2019 - Transcontinental Inc. (TSX: TCL.A TCL.B) announces its results for the first quarter of fiscal 2019, which ended January 27, 2019.
"I am satisfied with the revenue growth we experienced in the Packaging Sector in the first quarter of 2019, said François Olivier, President and Chief Executive Officer of TC Transcontinental. We remain committed to gradually improving our profit margins during the year, in particular by realizing the expected synergies related to the transformational acquisition of Coveris Americas.
"Our Printing Sector had a more moderate start, mainly as a result of the sale of our newspaper printing operations in California. Furthermore, while we saw a slight decrease in our revenues from our retailer-related service offering, it remains healthy and resilient.
"In summary, our consolidated results demonstrated solid growth in terms of revenues reflecting the dynamic implementation of our transformation. Though our profitability was somewhat softer than expected, we continue to rigorously execute our business plan.
"To conclude, we will continue generating significant cash flows from our operating activities, which will first be allocated to reducing our indebtedness."
Source: Transcontinental
