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      CORUS ENTERTAINMENT ANNOUNCES FISCAL 2022 THIRD QUARTER RESULTS


      News provided by

      Corus Entertainment Inc.

      Jun 29, 2022, 06:27 ET

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      • Consolidated revenue increased 8% for the quarter and 6% year-to-date
      • Consolidated segment profit(1) decreased 5% for the quarter and 8% year-to-date
      • Consolidated segment profit margin(1) of 29% for the quarter and 31% year-to-date
      • Net income attributable to shareholders of $29.6 million ($0.14 per share basic) for the quarter and $122.0 million ($0.59 per share basic) year-to-date
      • Net debt to segment profit(1) of 2.76 times at May 31, 2022, consistent with 2.76 times at August 31, 2021
      • Free cash flow(1) of $27.5 million for the quarter and $194.9 million year-to-date

      TORONTO, June 29, 2022 /PRNewswire/ - Corus Entertainment Inc. (TSX: CJR.B) announced its third quarter financial results today.

      "Our portfolio of businesses is producing growth on all fronts, delivering strong consolidated revenue gains for the fifth consecutive quarter," said Doug Murphy, President and Chief Executive Officer. "The diversity and resiliency of our business is evident with these results, as we benefit from multiple revenue initiatives including organic investments to further expand our digital business, grow our streaming product offering and build out our original content slate in pursuit of international content licensing opportunities. We have unveiled yet another strong fall schedule that once again secures our foothold as Canada's home of leading entertainment and lifestyle programming."

      Financial Highlights




















      Three months ended




      Nine months ended









      May 31,

      %



      May 31,

      %

      (in thousands of Canadian dollars
      except per share amounts)


      2022

      2021

      Change


      2022

      2021

      Change

      Revenue













      Television





      404,130

      379,822

      6 %


      1,178,538

      1,110,443

      6 %


      Radio





      29,328

      23,177

      27 %


      80,454

      71,785

      12 %







      433,458

      402,999

      8 %


      1,258,992

      1,182,228

      6 %














      Segment profit (loss) (1)












      Television (2)(3)




      127,518

      140,012

      (9 %)


      399,127

      439,133

      (9 %)


      Radio (2)(3)





      5,667

      1,285

      341 %


      11,538

      9,835

      17 %


      Corporate (2)




      (9,457)

      (10,626)

      (11 %)


      (23,211)

      (27,050)

      (14 %)







      123,728

      130,671

      (5 %)


      387,454

      421,918

      (8 %)














      Segment profit margin (1)












      Television





      32 %

      37 %



      34 %

      40 %



      Radio





      19 %

      6 %



      14 %

      14 %



      Consolidated




      29 %

      32 %



      31 %

      36 %















      Net income attributable to shareholders



      29,621

      40,666

      (27 %)


      122,007

      152,630

      (20 %)

      Basic earnings per share




      $0.14

      $0.20



      $0.59

      $0.73


      Diluted earnings per share




      $0.14

      $0.19



      $0.59

      $0.73















      Free cash flow (1)




      27,468

      64,702

      (58 %)


      194,872

      216,766

      (10 %)

      (1)

      In addition to disclosing results in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"), the Company also provides supplementary non-IFRS measures as a method of evaluating the Company's performance and to provide a better understanding of how management views the Company's performance. These non-IFRS or non-GAAP measures include: segment profit (loss), segment profit margin, free cash flow, net debt to segment profit, optimized advertising revenue and new platform revenue. These are not measurements in accordance with IFRS and should not be considered as an alternative to any other measure of performance under IFRS. Please see additional discussion and reconciliations under the Key Performance Indicators and Non-GAAP Financial Measures section of the Company's Third Quarter 2022 Report to Shareholders.

      (2)

      No claims for the Canada Emergency Wage Subsidy ("CEWS") have been made in fiscal 2022. In the prior year, segment profit for the quarter included $4.5 million (Television: $3.9 million; Radio: $0.6 million) and $12.6 million year-to-date (Television: $10.0 million; Radio: $1.7 million; Corporate: $0.9 million) of CEWS.

      (3)

      In the prior year, segment profit included relief on regulatory fees. As a result, CRTC part I and II fees have increased by $1.0 million (Television: $0.9 million; Radio: $0.1 million) in the quarter and by $9.4 million year-to-date (Television: $8.6 million; Radio: $0.8 million) compared to the same prior year periods.

      Segment Revenue







      Three months ended




      Nine months ended









      May 31,

      %



      May 31,

      %

      (in thousands of Canadian dollars)



      2022

      2021

      Change


      2022

      2021

      Change

      Revenue












      Television




      404,130

      379,822

      6 %


      1,178,538

      1,110,443

      6 %



      Advertising




      237,993

      233,181

      2 %


      707,725

      665,260

      6 %



      Subscriber




      130,410

      124,402

      5 %


      390,768

      372,314

      5 %



      Merchandising, distribution and other

      35,727

      22,239

      61 %


      80,045

      72,869

      10 %


      Radio




      29,328

      23,177

      27 %


      80,454

      71,785

      12 %

      Total Revenue




      433,458

      402,999

      8 %


      1,258,992

      1,182,228

      6 %














      Optimized advertising revenue (1)


      47 %

      38 %

      29 %


      42 %

      30 %

      45 %

      New platform revenue (1)



      11 %

      8 %

      40 %


      10 %

      8 %

      40 %

      (1)

      Optimized advertising revenue and new platform revenue do not have standardized meanings prescribed by IFRS. For definitions and explanations, see the discussion under the Key Performance Indicators and Non-GAAP Financial Measures section of the Third Quarter 2022 Report to Shareholders.

      Operational Highlights 

      The Company advanced its Strategic Priorities on multiple fronts. Corus expanded its digital and traditional video advertising offerings; unveiled its extensive 2022/2023 programming lineup for Global TV and Corus' portfolio of Specialty Networks, announced its 2022/2023 original content production slate and international sales were secured through Corus' content business. The Company advanced its capital allocation priorities through investments in the business to support future growth opportunities, maintaining dividends, bank debt repayments, and share repurchases.

      • The Company's Corus Studios announced its largest U.S. output deal ever with streaming platform Hulu. This new multi-year agreement consists of over 400 episodes of lifestyle, renovation, unscripted and crime content from Corus Studios, building on the previously announced sale to Hulu of 200+ episodes last year.
      • The Company and Paramount Global announced that Pluto TV, the world's leading FAST (free ad-supported streaming television) service, will launch in Canada this fall. Pluto TV will encompass more than 100 unique, curated channels and over 20,000 hours of content, offering a full spectrum of free programming including drama, comedy, lifestyle, kids, movies, around-the-clock news, and more. Corus will act as advertising sales representative in Canada and provide multiple Canadian channels to the service.
      • The Company announced more than 200 additional hours of Canadian original content across its portfolio of networks. The lineup of premium original content for 2022/2023 includes 45 greenlights and renewals, and more than 600 episodes. Departure and Family Law will return to the Global TV schedule while the Corus Studios slate for 2022/2023 includes 24 titles, with returning hits Island of Bryan and Scott's Vacation House Rules plus new series Pamela's Garden of Eden and Renovation Resort.
      • The Company's Global TV unveiled its extensive 2022/2023 programming lineup, featuring returning top hits Survivor, 9-1-1 and CSI: Vegas, and new series Fire Country, Monarch and So Help Me Todd.
      Financial Highlights
      • Free cash flow(1) of $27.5 million in Q3 and $194.9 million year-to-date compared to $64.7 million and $216.8 million year-to-date, respectively, in the same comparable prior year periods. The decrease in free cash flow in the third quarter is attributable to a decrease in cash provided by operating activities of $37.5 million. The decrease in free cash flow for the nine months ended May 31, 2022 is mainly attributable to a decrease in cash provided by operating activities of $63.4 million, offset by a $43.5 million venture fund distribution.
      • Net debt to segment profit(1) was 2.76 times at May 31, 2022, up from 2.70 at February 28, 2022, but consistent with August 31, 2021. Although net debt decreased from the repayment of bank loans, partially offset by the issuance of Senior Unsecured Notes due 2030 and production financing for an acquired subsidiary, the main driver to the increase in this ratio is the decrease of segment profit(1) for the most recent four quarters.
      • In the third quarter, the Company purchased 4,018,000 of its Class B Non-Voting Participating Shares under a normal course issuer bid at an average acquisition price of $4.29.
      • As of May 31, 2022, the Company had $51.7 million of cash and cash equivalents and the committed $300.0 million Revolving Facility that remains undrawn.

      (1)

      Free cash flow, net debt to segment profit and segment profit do not have standardized meanings prescribed by IFRS. The Company reports on these because they are key measures used to evaluate performance. For definitions and explanations, see the discussion under the Key Performance Indicators and Non-GAAP Measures section of the Third Quarter 2022 Report to Shareholders and/or Management's Discussion and Analysis in the Company's Annual Report for the year ended August 31, 2021.

      Corus Entertainment Inc. reports its financial results in Canadian dollars.

      The unaudited interim condensed consolidated financial statements and accompanying notes for the three and nine months ended May 31, 2022 and Management's Discussion and Analysis are available on the Company's website at www.corusent.com in the Investor Relations section and under the Company's SEDAR profile at www.sedar.com.

      A conference call with Corus senior management is scheduled for June 29, 2022 at 8:00 a.m. ET. While this call is directed at analysts and investors, members of the media are welcome to listen in. The dial-in number for the conference call for local and international callers is 1.647.484.0477 and for North America is 1.800.289.0571. More information can be found on the Corus Entertainment website at www.corusent.com in the Investor Relations section.

      COVID-19 Update

      Many provinces and territories have lifted many of the health restrictions related to COVID-19, which has led to a phased return to on-site work across various sectors. However, disruptions caused by prior imposition or removal of public health restrictions, public sentiment about the pandemic and continuing COVID-19 infection rates, including labour shortages, employee absenteeism at the Company or its clients and suppliers, changes in consumer demand, and supply chain shortages or disruptions, particularly in the retail, tourism and entertainment sectors, can negatively impact the Company's operations and financial performance, including advertising demand and revenue. There can be no certainty that current vaccination and public health measures can mitigate negative impacts caused by the COVID-19 pandemic on the Company's business in the short to medium term.

      Other Economic and Market Conditions

      As discussed further in the 2021 MD&A under the heading "Economic Conditions", the Company's operating performance is affected by general Canadian and worldwide economic conditions. Changes or volatility in domestic or international economic conditions, economic uncertainty or geopolitical conflict and tensions, may affect discretionary consumer and business spending, resulting in increased or decreased demand for Corus' product offerings. In addition, elevated consumer price index inflation driven by sharp increases in energy and food prices as well as supply disruptions and strong demand for goods can also affect the Company's business operations and financial performance. All of the foregoing factors may adversely affect the Company through disruption to supply chains, increased costs of labour or disruption to availability of labour, related reduced advertising demand or spending, or lower demand for the Company's products and services, all of which may lead to decreased revenue or profitability. Finally, in all cases, the Company's business and financial condition are subject to audience and consumer acceptance of Corus' brands, programming and talent.

      Use of Non-GAAP Financial Measures

      This press release includes the non-GAAP or non-IFRS financial measures of segment profit, segment profit margin, free cash flow, adjusted net income, adjusted basic earnings per share, net debt to segment profit, optimized advertising revenue, and new platform revenue that are not in accordance with, nor an alternate to, generally accepted accounting principles ("GAAP") and may be different from non-GAAP or non-IFRS measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles.

      Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with IFRS. They are limited in value because they exclude charges that have a material effect on the Company's reported results and, therefore, should not be relied upon as the sole financial measures to evaluate the Company's financial results. The non-GAAP financial measures are meant to supplement, and to be viewed in conjunction with, IFRS financial results. A reconciliation of the Company's non-GAAP measures is included in the Company's most recent Report to Shareholders for the three and nine months ended May 31, 2022, which is available on Corus' website at www.corusent.com as well as on SEDAR at www.sedar.com.

      Caution Concerning Forward-Looking Information

      This press release contains forward-looking information and should be read subject to the following cautionary language:

      To the extent any statements made in this press release contain information that is not historical, these statements are forward-looking statements and may be forward-looking information within the meaning of applicable securities laws (collectively, "forward-looking information"). This forward-looking information relates to, among other things, the Company's objectives, goals, strategies, targets, intentions, plans, estimates and outlook, including the adoption and anticipated impact of the Company's strategic plan, advertising and expectations of advertising trends for fiscal 2022, distribution, merchandise and subscription revenue, the Company's dividend policy and the payment of future dividends; the Company's leverage target; the Company's proposed share purchases, including the number of Class B non-voting shares to be repurchased under its normal course issuer bid, if any, and timing thereof; the Company's ability to manage retention and reputation risks related to its on-air talent; expectations regarding financial performance including capital allocation strategy and capital structure management, operating costs and tariffs, taxes and fees, and can generally be identified by the use of words such as "believe", "anticipate", "expect", "intend", "plan", "will", "may" or the negative of these terms and other similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances may be considered forward-looking information. Although Corus believes that the expectations reflected in such forward-looking information are reasonable, such information involves assumptions, risks and uncertainties and undue reliance should not be placed on such statements. Certain material factors or assumptions are applied with respect to the forward-looking information, including without limitation, factors and assumptions regarding the general market conditions and general outlook for the industry including the potential impact of new competition and industry mergers and acquisitions, interest rates, stability of the advertising, distribution, merchandise and subscription markets, operating and capital costs and tariffs, taxes and fees, the Company's ability to source desirable content and the Company's capital and operating results being consistent with the Company's expectations. Actual results may differ materially from those expressed or implied in such information. Important factors that could cause actual results to differ materially from these expectations include, among other things: the Company's ability to attract and retain advertising revenue; audience acceptance of the Company's television programs and cable networks; the Company's ability to recoup production costs; the availability of tax credits and the existence of co-production treaties; the Company's ability to compete in any of the industries in which it does business; the opportunities (or lack thereof) that may be presented to and pursued by the Company; conditions in the entertainment, information and communications industries and technological developments therein; changes in laws or regulations or the interpretation or application of those laws and regulations; the Company's ability to integrate and realize anticipated benefits from its acquisitions and to effectively manage it's growth; the Company's ability to successfully defend itself against litigation matters and complaints; failure to meet covenants under the Company's senior credit facility, senior unsecured notes or other instruments or facilities; epidemics, pandemics or other public health crises, including the current outbreak of COVID-19 and changes in accounting standards. Additional information about these factors and about the material assumptions underlying any forward-looking information may be found under the heading "Risks and Uncertainties" in the Company's Management's Discussion and Analysis for the year ended August 31, 2021 and under the heading "Risk Factors" in the Company's Annual Information Form for the year ended August 31, 2021. Corus cautions that the foregoing list of important assumptions and factors that may affect future results is not exhaustive. When relying on the Company's forward-looking information to make decisions with respect to Corus, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Unless otherwise specified, all forward-looking information in this document speaks as of the date of this document. Unless otherwise required by applicable securities laws, Corus disclaims any intention or obligation to publicly update or revise any forward-looking information whether as a result of new information, events or circumstances that arise after the date thereof or otherwise.

      About Corus Entertainment Inc.

      Corus Entertainment Inc. (TSX: CJR.B) is a leading media and content company that develops and delivers high quality brands and content across platforms for audiences around the world. Engaging audiences since 1999, the Company's portfolio of multimedia offerings encompass 33 specialty television services, 39 radio stations, 15 conventional television stations, a suite of digital and streaming assets, animation software, technology and media services. Corus is an internationally-renowned content creator and distributor through Nelvana, a world class animation studio expert in all formats and Corus Studios, a globally recognized producer of hit scripted and unscripted content. The Company also owns innovative full-service social digital agency so.da, lifestyle entertainment company Kin Canada, leading 2D animation software supplier Toon Boom and children's book publishing house, Kids Can Press. Corus' roster of premium brands includes Global Television, W Network, HGTV Canada, Food Network Canada, Magnolia Network Canada, The HISTORY® Channel, Showcase, Adult Swim, National Geographic, Disney Channel Canada, YTV, Global  News, Globalnews.ca, Q107, Country 105, and CFOX, along with broadly distributed Canadian streaming platforms STACKTV, Nick+, the Global TV App and Curiouscast. For more information visit www.corusent.com.

      CORUS ENTERTAINMENT INC.



      CONSOLIDATED STATEMENTS OF FINANCIAL POSITION



       

       

      (unaudited - in thousands of Canadian dollars)

      As at May 31,

      As at August 31,

      2022

      2021

      ASSETS



      Current



      Cash and cash equivalents

      51,693

      43,685

      Accounts receivable

      412,801

      325,587

      Income taxes recoverable

      —

      5,597

      Prepaid expenses and other assets

      22,105

      24,106

      Total current assets

      486,599

      398,975

      Tax credits receivable

      37,345

      24,501

      Investments and other assets

      68,593

      98,667

      Property, plant and equipment

      294,605

      316,226

      Program rights

      699,451

      576,076

      Film investments

      55,665

      39,732

      Intangibles

      1,647,820

      1,687,432

      Goodwill

      666,308

      664,958

      Deferred income tax assets

      50,471

      50,050


      4,006,857

      3,856,617

       

      LIABILITIES AND EQUITY



      Current



      Accounts payable and accrued liabilities

      612,460

      509,817

      Current portion of long-term debt

      10,811

      35,328

      Provisions

      7,368

      7,202

      Income taxes payable

      101

      —

      Total current liabilities

      630,740

      552,347

      Long-term debt

      1,257,184

      1,313,965

      Other long-term liabilities

      393,922

      331,482

      Provisions

      8,969

      9,497

      Deferred income tax liabilities

      419,192

      428,963

      Total liabilities

      2,710,007

      2,636,254

       

      EQUITY



      Share capital

      790,831

      816,189

      Contributed surplus

      1,510,198

      1,512,431

      Accumulated deficit

      (1,192,931)

      (1,282,897)

      Accumulated other comprehensive income

      31,877

      21,811

      Total equity attributable to shareholders

      1,139,975

      1,067,534

      Equity attributable to non-controlling interest

      156,875

      152,829

      Total equity

      1,296,850

      1,220,363


      4,006,857

      3,856,617

      CORUS ENTERTAINMENT INC.

      CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME


      Three months ended 

      Nine months ended 


      May 31,  

      May 31, 

      (unaudited - in thousands of Canadian dollars except per share amounts)

      2022

      2021

      2022

      2021

      Revenue

      433,458

      402,999

      1,258,992

      1,182,228

      Direct cost of sales, general and administrative expenses

      309,730

      272,328

      871,538

      760,310

      Depreciation and amortization

      39,952

      38,117

      117,080

      114,405

      Interest expense

      28,514

      26,807

      79,795

      75,890

      Debt refinancing

      (3,830)

      3,408

      (3,428)

      3,408

      Restructuring and other costs

      4,169

      1,561

      6,223

      8,885

      Other expense (income), net

      10,795

      (4,755)

      7,592

      (11,612)

      Income before income taxes

      44,128

      65,533

      180,192

      230,942

      Income tax expense

      11,136

      17,258

      46,323

      60,222

      Net income for the period

      32,992

      48,275

      133,869

      170,720

       

      Other comprehensive income, net of income taxes:





      Items that may be reclassified subsequently to income:





      Unrealized change in fair value of cash flow hedges

      1,506

      4,611

      5,007

      9,640

      Unrealized foreign currency translation adjustment

      8

      (1,295)

      40

      (1,707)


      1,514

      3,316

      5,047

      7,933

      Items that will not be reclassified to income:





      Unrealized change in fair value of financial assets

      (5,649)

      18,055

      5,019

      16,468

      Actuarial gain on post-retirement benefit plans

      4,467

      4,171

      6,927

      13,900


      (1,182)

      22,226

      11,946

      30,368

      Other comprehensive income, net of income taxes

      332

      25,542

      16,993

      38,301

      Comprehensive income for the period

      33,324

      73,817

      150,862

      209,021






      Net income attributable to:





      Shareholders

      29,621

      40,666

      122,007

      152,630

      Non-controlling interest

      3,371

      7,609

      11,862

      18,090


      32,992

      48,275

      133,869

      170,720






      Comprehensive income attributable to:





      Shareholders

      29,953

      66,208

      139,000

      190,931

      Non-controlling interest

      3,371

      7,609

      11,862

      18,090


      33,324

      73,817

      150,862

      209,021






      Earnings per share attributable to shareholders:





      Basic

      $0.14

      $0.20

      $0.59

      $0.73

      Diluted

      $0.14

      $0.19

      $0.59

      $0.73

      CORUS ENTERTAINMENT INC.








      CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

       

       

       

      (unaudited - in thousands of Canadian dollars)

       

       

      Share capital

       

       

      Contributed

      surplus

       

       

      Accumulated

      deficit

      Accumulated
      other
      comprehensive

      income

       

      Total equity
      attributable to
      shareholders

       

      Non-
      controlling
      interest

       

       

       

      Total equity

      As at August 31, 2021

      816,189

      1,512,431

      (1,282,897)

      21,811

      1,067,534

      152,829

      1,220,363

      Comprehensive income

      —

      —

      122,007

      16,993

      139,000

      11,862

      150,862

      Dividends declared

      —

      —

      (37,411)

      —

      (37,411)

      (14,145)

      (51,556)

      Business acquisition

      —

      —

      —

      —

      —

      864

      864

      Change in fair value of put option
           liability arising from business
            acquisition

      —

      —

      (1,557)

      —

      (1,557)

      (254)

      (1,811)

      Shares repurchased under 
           normal course issuer bid
           ("NCIB")

      (21,127)

      (2,852)

      —

      —

      (23,979)

      —

      (23,979)

      Share repurchase commitment
           under NCIB

      (4,231)

      (316)

      —

      —

      (4,547)

      —

      (4,547)

      Actuarial gain on post-retirement
           benefit plans

      —

      —

      6,927

      (6,927)

      —

      —

      —

      Share-based compensation expense

      —

      935

      —

      —

      935

      —

      935

      Equity funding by a non-
      controlling interest

      —

      —

      —

      —

      —

      5,719

      5,719

      As at May 31, 2022

      790,831

      1,510,198

      (1,192,931)

      31,877

      1,139,975

      156,875

      1,296,850

       

       

       

      (unaudited - in thousands of Canadian dollars)

       

       

       

      Share capital

       

       

       

      Contributed

      surplus

       

       

       

      Accumulated

      deficit

       

      Accumulated

      other
      comprehensive
      income (deficit)

       

       

      Total equity
      attributable to
      shareholders

       

       

      Non-
      controlling
      interest

       

       

       

      Total equity

      As at August 31, 2020

      816,189

      1,511,325

      (1,425,432)

      (2,258)

      899,824

      148,595

      1,048,419

      Comprehensive income

      —

      —

      152,630

      38,301

      190,931

      18,090

      209,021

      Dividends declared

      —

      —

      (37,493)

      —

      (37,493)

      (11,543)

      (49,036)

      Actuarial gain on post-retirement
           benefit plans

      —

      —

      13,900

      (13,900)

      —

      —

      —

      Share-based compensation expense

      —

      830

      —

      —

      830

      —

      830

      Return of capital to non-controlling 
           interest

      —

      —

      —

      —

      —

      (1,622)

      (1,622)

      Equity funding by a 
           non-controlling interest

      —

      —

      —

      —

      —

      2,126

      2,126

      Reallocation of equity interest

      —

      —

      617

      —

      617

      (617)

      —

      As at May 31, 2021

      816,189

      1,512,155

      (1,295,778)

      22,143

      1,054,709

      155,029

      1,209,738

      CORUS ENTERTAINMENT INC.





      CONSOLIDATED STATEMENTS OF CASH FLOWS






      Three months ended

      Nine months ended



      May 31,


      May 31,

      (unaudited - in thousands of Canadian dollars)

      2022

      2021

      2022

      2021

      OPERATING ACTIVITIES





      Net income for the period

      32,992

      48,275

      133,869

      170,720

      Adjustments to reconcile net income to cash flow from operations:





      Amortization of program rights

      150,093

      139,301

      426,213

      375,161

      Amortization of film investments

      12,051

      2,980

      19,135

      9,900

      Depreciation and amortization

      39,952

      38,117

      117,080

      114,405

      Deferred income tax recovery

      (4,861)

      (6,419)

      (7,342)

      (22,656)

      Share-based compensation expense

      324

      269

      935

      830

      Imputed interest

      11,827

      10,710

      34,967

      32,753

      Debt refinancing

      (3,830)

      3,408

      (3,428)

      3,408

      Payment of program rights

      (173,366)

      (169,787)

      (403,574)

      (372,044)

      Net spend on film investments

      (11,803)

      (4,013)

      (39,397)

      (21,319)

      CRTC benefit payments

      —

      —

      —

      (635)

      Other

      10,882

      (599)

      5,826

      680

      Cash flow from operations

      64,261

      62,242

      284,284

      291,203

      Net change in non-cash working capital balances related to operations

      (34,463)

      5,071

      (123,284)

      (66,801)

      Cash provided by operating activities

      29,798

      67,313

      161,000

      224,402

      INVESTING ACTIVITIES





      Additions to property, plant and equipment

      (2,819)

      (2,002)

      (8,866)

      (6,184)

      Proceeds from sale of property

      —

      172

      125

      319

      Business combination, net of cash acquired

      —

      —

      3,606

      —

      Venture fund distribution

      —

      —

      43,478

      —

      Net cash flows for intangibles, investments and other assets

      489

      (732)

      (1,729)

      (2,512)

      Cash provided by (used in) investing activities

      (2,330)

      (2,562)

      36,614

      (8,377)

      FINANCING ACTIVITIES





      Decrease in bank loans

      (27,872)

      (507,527)

      (347,630)

      (602,163)

      Financing fees

      (1,492)

      (12,119)

      (5,892)

      (12,119)

      Issuance of senior unsecured notes

      —

      500,000

      250,000

      500,000

      Share repurchase under NCIB

      (17,231)

      —

      (23,081)

      —

      Return of capital to non-controlling interest

      —

      —

      —

      (1,622)

      Equity funding by a non-controlling interest

      —

      —

      3,742

      2,126

      Payment of lease liabilities

      (4,441)

      (4,170)

      (12,609)

      (12,136)

      Dividends paid

      (12,415)

      (12,497)

      (37,411)

      (37,493)

      Dividends paid to non-controlling interest

      (7,520)

      (3,136)

      (14,145)

      (11,543)

      Other

      (254)

      (406)

      (2,580)

      (2,857)

      Cash used in financing activities

      (71,225)

      (39,855)

      (189,606)

      (177,807)

      Net change in cash and cash equivalents during the period

      (43,757)

      24,896

      8,008

      38,218

      Cash and cash equivalents, beginning of the period

      95,450

      59,222

      43,685

      45,900

      Cash and cash equivalents, end of the period

      51,693

      84,118

      51,693

      84,118

      CORUS ENTERTAINMENT INC.





      BUSINESS SEGMENT INFORMATION





       

      (unaudited - in thousands of Canadian dollars)





      Three months ended May 31, 2022






      Television

      Radio

      Corporate

      Consolidated

      Revenue

      404,130

      29,328

      —

      433,458

      Direct cost of sales, general and administrative expenses

      276,612

      23,661

      9,457

      309,730

      Segment profit (loss)(1)

      127,518

      5,667

      (9,457)

      123,728

      Depreciation and amortization




      39,952

      Interest expense




      28,514

      Debt refinancing




      (3,830)

      Restructuring and other costs




      4,169

      Other expense, net




      10,795

      Income before income taxes




      44,128

       

      Three months ended May 31, 2021






      Television

      Radio

      Corporate

      Consolidated

      Revenue

      379,822

      23,177

      —

      402,999

      Direct cost of sales, general and administrative expenses

      239,810

      21,892

      10,626

      272,328

      Segment profit (loss)(1)

      140,012

      1,285

      (10,626)

      130,671

      Depreciation and amortization




      38,117

      Interest expense




      26,807

      Debt refinancing




      3,408

      Restructuring and other costs




      1,561

      Other income, net




      (4,755)

      Income before income taxes




      65,533

      Nine months ended May 31, 2022






      Television

      Radio

      Corporate

      Consolidated

      Revenue

      1,178,538

      80,454

      —

      1,258,992

      Direct cost of sales, general and administrative expenses

      779,411

      68,916

      23,211

      871,538

      Segment profit (loss)(1)

      399,127

      11,538

      (23,211)

      387,454

      Depreciation and amortization




      117,080

      Interest expense




      79,795

      Debt refinancing




      (3,428)

      Restructuring and other costs




      6,223

      Other expense, net




      7,592

      Income before income taxes




      180,192

      Nine months ended May 31, 2021






      Television

      Radio

      Corporate

      Consolidated

      Revenue

      1,110,443

      71,785

      —

      1,182,228

      Direct cost of sales, general and administrative expenses

      671,310

      61,950

      27,050

      760,310

      Segment profit (loss)(1)

      439,133

      9,835

      (27,050)

      421,918

      Depreciation and amortization




      114,405

      Interest expense




      75,890

      Debt refinancing




      3,408

      Restructuring and other costs




      8,885

      Other income, net




      (11,612)

      Income before income taxes




      230,942

      (1)

      Segment profit (loss) does not have a standardized meaning prescribed by IFRS. For definitions and explanations, see discussion under the Key Performance Indicators section of the Third Quarter 2022 Report to Shareholders.

       

      REVENUE BY TYPE






                Three months ended

      Nine months ended



      May 31,


      May 31,

      (unaudited - in thousands of Canadian dollars)

      2022

      2021

      2022

      2021

      Advertising

      265,915

      255,082

      784,228

      733,160

      Subscriber

      130,410

      124,402

      390,768

      372,314

      Merchandising, distribution and other

      37,133

      23,515

      83,996

      76,754


      433,458

      402,999

      1,258,992

      1,182,228

      NON-GAAP FINANCIAL MEASURES 



      Three months ended 


      Nine months ended 


      (unaudited - in thousands of Canadian dollars, except percentages) 

      May 31, 

      %

      May 31, 

      %

      Optimized advertising revenue

      2022

      2021

      Change

      2022

      2021

      Change

      Optimized advertising revenue (numerator)

      112,677

      87,496

      29 %

      294,880

      202,739

      45 %

      Television advertising revenue (denominator)

      237,993

      233,181

      2 %

      707,725

      665,260

      6 %

      Optimized advertising revenue percentage

      47 %

      38 %

      42 %

      30 %


      Three months ended


      Nine months ended


      (unaudited - in thousands of Canadian dollars, except percentages)

      May 31,

      %

      May 31,

      %

      New platform revenue

      2022

      2021

      Change

      2022

      2021

      Change

      New platform revenue (numerator)

      40,992

      29,199

      40 %

      109,223

      77,842

      40 %

      Television advertising revenue

      237,993

      233,181

      2 %

      707,725

      665,260

      6 %

      Television subscriber revenue

      130,410

      124,402

      5 %

      390,768

      372,314

      5 %

      Total Television advertising and subscriber revenue (denominator)

      368,403

      357,583

      3 %

      1,098,493

      1,037,574

      6 %

      New platform revenue percentage

      11 %

      8 %


      10 %

      8 %



      Three months ended 

      Nine months ended 

      (unaudited - in thousands of Canadian dollars) 

      May 31, 

      May 31, 

      Free Cash Flow

      2022

      2021

      2022

      2021

      Cash provided by (used in):





      Operating activities

      29,798

      67,313

      161,000

      224,402

      Investing activities

      (2,330)

      (2,562)

      36,614

      (8,377)

       

      Add: cash used in (provided by) business acquisitions and strategic investments (1)

      27,468

      64,751

      197,614

      216,025

      —

      (49)

      (2,742)

      741

      Free cash flow

      27,468

      64,702

      194,872

      216,766

      (1)

      Strategic investments are comprised of investments in venture funds and associated companies.


      Nine months ended 

      (unaudited - in thousands of Canadian dollars)  

      May 31, 

      August 31,

      Net Debt and Net Debt to Segment Profit

      2022

      2021

      Total debt, net of unamortized financing fees and prepayment options

      1,267,995

      1,349,293

      Lease liabilities

      136,722

      143,546

      Cash and cash equivalents

      (51,693)

      (43,685)

      Net debt (numerator)

      1,353,024

      1,449,154

      Segment profit (denominator) (1)

      490,154

      524,618

      Net debt to segment profit

      2.76

      2.76

      (1)

      Reflects aggregate amounts for the most recent four quarters, as detailed in the table in the "Quarterly Consolidated Financial Information" section of the Third Quarter 2022 Report to Shareholders.

      SOURCE Corus Entertainment Inc.

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