Archives for February 27, 2020

Torstar reports Q4 profit as ad revenue drops

Torstar Corp. reported a profit in its fourth-quarter, boosted by one-time gains related to its pension plans and the sale of two real estate properties in Ontario, even as print revenue continued to decline.

The publisher of the Toronto Star and other newspapers said Wednesday that its profit attributable to shareholders amounted to $14.1 million or 17 cents per share for the quarter ended Dec. 31. That compared with a loss attributable to shareholders of nearly $3.1 million or four cents per share in the fourth quarter a year earlier.

Results in the quarter were boosted by one-time gains including $24.6 million related to the transfer of pension assets and liabilities to the Colleges of Applied Arts and Technology Pension Plan as well as a gain of $3.5 million related to the sale of two real estate properties in Ontario.

Adjusted earnings per share amounted to 11 cents in the fourth quarter of 2019 compared with an adjusted profit per share of 15 cents in the fourth quarter of 2018.

The company says it had an operating loss of $13.1 million in the quarter on operating revenue of $124 million, compared with an operating profit of $9.8 million on $144.9 million a year earlier.

Torstar says it’s making progress on its business transformation, including increased digital subscriptions. The company reports it now has 28,000 digital-only subscribers, up from 10,000 a year earlier, after introducing the paid digital subscriptions in the third quarter of 2018.

Overall, the company says subscription revenue has somewhat stabilized.

“We have now experienced stable subscriber revenue for the fifth consecutive quarter, underpinned by our investment in data and our ongoing commitment to journalism,” said Torstar Corp. CEO John Boynton on a conference call.

Advertising revenue, however, continues to be under pressure. Print advertising revenues were down 24 per cent from a year earlier and flyer distribution revenue down 16 per cent, which contributed to the company shutting down several free dailies, said Neil Oliver, president of daily news brands.

“As a result of these continued pressures on print advertising revenues, at the end of December, we ceased publication of the printed additions of the Star Metro free daily newspapers, in order to both reduce cost and transition to a digital-only new service outside of Ontario.”

For 2019 as a whole, print advertising was down 21 per cent to $155.1 million, digital advertising down eight per cent to $60.3 million, and flyer distribution down 11.5 per cent, while subscriber revenue inched up one per cent to $119.7 million.

In early February the company announced it would sell the land and building used by the Hamilton Spectator for $25.5 million.

Alberta government seeks stay on judge’s oilsands decision

Alberta government lawyers are to be in a Calgary court today to ask for a stay of an order requiring it to make a decision on a proposed oilsands project near Fort McMurray.

Last week, Court of Queen’s Bench Justice Barbara Romaine gave the province 10 days to make a decision on the Rigel project.

Prosper Petroleum Ltd. argued that waiting for the last 19 months for the province to decide on the project has been unreasonable.

It was initially proposed in 2013 and approved by the Alberta Energy Regulator in June of 2018.

The United Conservative government quickly appealed the ruling and is asking for it to be stayed until the appeal is heard.

The 10,000-barrel-a-day, steam-driven project would be built in the Moose Lake area, about 70 kilometres northwest of Fort McMurray.

The region is sacred to the Fort McKay First Nation. An agreement to protect the area was reached under former Alberta premier Jim Prentice but was never ratified.

The project was recently the subject of a meeting between Indigenous leaders and members of the provincial cabinet. The two sides agreed to meet again in April.

Romaine pointed out in her decision that, on average, it takes the Alberta cabinet seven months to make a decision on a project such as Rigel.

“There is a strong public interest in encouraging a timely cabinet decision. The balance of convenience supports an injunction,” the judge said.

Desjardins says theft of 4.2 million members’ data cost $108M

The Desjardins Group says last year’s theft of the personal data of its 4.2 million members ultimately cost the co-operative $108 million.

The Quebec-based financial institution initially estimated the cost of a malicious employee’s breach — which also affected 1.8 million credit card holders — at $70 million.

Chief executive Guy Cormier says the impact is less than one per cent of its $18 billion in revenues in 2019.

It may seem like a large amount, but he says Desjardins has “ample capacity” to absorb the expense.

The costs are mainly related to the package of measures offered to members, such as free credit monitoring service from Equifax for five years.

Cormier says there should be no further increase in costs related to the data theft, which has plunged the co-operative into turmoil since it was revealed last June.

Desjardins says its net surplus increased 11.7 per cent to $2.6 billion before $317 million in dividends are paid to members. The dividend is up 25 per cent from last year and is at its highest level since 2011.