Yellow Media Limited Reports Third Quarter 2014 Financial Results
(firmenpresse) - MONTREAL, QUEBEC -- (Marketwired) -- 11/12/14 -- Yellow Media Limited (TSX: Y)
Yellow Media Limited (TSX: Y) (the "Company" or "Yellow Media") released its operational and financial results today for the third quarter ended September 30, 2014. The Company remains active in strengthening its financial profile, gaining traction on the implementation of the Return to Growth Plan (the "Plan") while materially deleveraging its balance sheet.
"The Company continues to make progress on the delivery and execution of the Return to Growth Plan," said Julien Billot, President and Chief Executive Officer of Yellow Media. "We have hit key milestones during the third quarter of 2014, as digital revenues now represent over 50% of consolidated revenues. In addition, we have achieved our 2014 target for customer acquisition, continue to experience steady growth in traffic across our core digital properties, and remain active in optimizing our balance sheet through material debt repayment."
Third Quarter 2014 Financial Results
Revenues for the third quarter of 2014 decreased to $218.4 million, representing an 8% year-over-year decline. Consolidated revenues continue to be negatively impacted by print revenues, which fell 22.8% year-over-year to reach $104.8 million during the three-month period ended September 30, 2014.
Albeit declining, print revenues remain in line with expectations and decline rates have shown signs of stabilization. Over the course of 2014, the Company has launched the Print Product Simplification ("PPS") initiative to support print revenues. By increasing print advertisement sizes at no incremental cost to the customer, PPS protects customer renewal while ultimately preserving content and usage of the print directory. PPS also simplifies the selling process for our Media Account Consultants by reducing the number of print offers available to current and prospective customers.
Total digital revenues reached $113.6 million during the third quarter of 2014, growing 11.9% from the same period last year. For the quarter ended September 30, 2014, digital revenues across the Company''s core YP operations, which exclude the impact of Mediative, 411 Local Search Corp., and Wall2Wall, increased by 8.7% year-over-year.
For the three-month period ended September 30, 2014, digital revenues represented 52% of total revenues, up from 42.8% for the same period last year. Facilitated by a comprehensive product suite, digital revenue growth continues to be driven by the migration of print customers towards digital solutions. Digital revenue growth is also supported by customer acquisition, as the majority of new customers principally purchase digital offerings.
The customer penetration of the YP™ 360 degrees Solution, defined as the percentage of YP customers who purchase three product categories or more, grew from 24% last year to 35% as at September 30, 2014. The Company''s high-margin owned and operated digital media solutions remained widely adopted, with customer penetration having reached 63% as at September 30, 2014, up from 61% at the same time last year.
EBITDA decreased to $75.3 million during the third quarter of 2014, as compared to $102.1 million the year prior. EBITDA remains adversely impacted by print revenue pressure and a lower EBITDA margin. The EBITDA margin decreased to 34.5% for the three-month period ended September 30, 2014, relative to 43% for the same period last year. Lower revenues and investments related to the digital transformation were the main contributors to the decrease in the EBITDA margin.
For the third quarter ended September 30, 2014, the Company recorded net earnings of $26.5 million and basic earnings per share of $0.98. This compares to net earnings of $41.8 million and basic earnings per share of $1.51 for the same period last year. The decrease is mainly attributed to lower EBITDA.
Free cash flow during the third quarter of 2014 totaled $37.6 million, as compared to $64.3 million during the same period last year. This decline results mainly from lower EBITDA and higher income taxes paid in 2014, as the Company was not required to pay income tax installments in 2013, partially offset by favourable timing in the payment of certain accounts payable.
Net debt totaled $478.4 million as at September 30, 2014, down from $533.1 million as at December 31, 2013. The Company anticipates making a $66 million principal mandatory redemption payment on the 9.25% Senior Secured Notes on December 1, 2014. Following this payment, 2014 mandatory redemption payments will total $139.6 million, which surpasses the minimum requirement of $125 million for 2014 and 2015 combined.
"As evidenced by the repayment of $140 million in debt in 2014, the Company continues to actively optimize its balance sheet," said Ginette Maille, Chief Financial Officer of Yellow Media. "The Return to Growth Plan remains a fully funded plan, and we will continue to generate the cash flow required to invest in our digital transformation and repay our Senior Secured Notes."
Operational Update
"Growing the customer base is fundamental to returning Yellow Media to revenue and EBITDA growth," said Billot. "We have accelerated customer acquisition throughout 2014, and are investing to maintain this momentum in 2015 by reinforcing our digital perception in the marketplace, growing traffic and leads across our digital media properties, and delivering small and medium enterprises an improved sales and customer service experience."
Extending our Brand Promise
Strengthening our Media Assets
Enhancing our Go-to-Market Strategy
a) Promoting Customer Acquisition
b) Promoting Customer Retention
Improving Business Efficiencies
Board of Directors
On October 15, 2014, Susan Kudzman was appointed to the board of Yellow Media, increasing the number of board members to eleven directors, three of whom are women.
Ms. Kudzman brings forth extensive expertise in human resources and risk management within the financial, media, and communications industries. Ms. Kudzman is currently Senior Vice President, Human Resources at Laurentian Bank. Prior to that, Ms. Kudzman was a partner at Mercer Canada and held executive positions at Caisse de depot et placement du Quebec and BCE Emergis Inc.
Investor Conference Call
Yellow Media Limited will hold an analyst and media call at 1:00 p.m. (Eastern Time) on November 12, 2014 to discuss third quarter 2014 results. The call may be accessed by dialing (416) 340-2218 within the Toronto area, or 1 866 225-2055 outside of Toronto.
The call will be simultaneously webcast on the Company''s website at
The conference call will be archived in the Investors section of the site at .
A playback of the call can also be accessed from November 12 to November 19, 2014 by dialing (905) 694-9451 within the Toronto area, or 1 800 408-3053 outside Toronto.
The conference passcode is 6198865.
About Yellow Media Limited
Yellow Media Limited (TSX: Y) is a Canadian digital and print media company, offering businesses comprehensive media solutions to meet their key marketing objectives and providing consumers with platforms to access reliable local business information. By helping local businesses foster stronger relationships with their consumers through its various media, the Company encourages the growth of thriving neighbourhood economies. Yellow Media holds some of Canada''s leading local online search properties including , and , the , , RedFlagDeals and Canada411 mobile applications and Yellow Pages™ print directories. Yellow Media is also a leader in national digital advertising through , a division of Yellow Pages Group devoted to digital marketing and performance media services for national-scale agencies and customers. For more information, visit .
Caution Concerning Forward-Looking Statements
This press release contains forward-looking statements about the objectives, strategies, financial conditions, results of operations and businesses of the Company. These statements are forward-looking as they are based on our current expectations, as at November 12, 2014, about our business and the markets we operate in, and on various estimates and assumptions. Our actual results could materially differ from our expectations if known or unknown risks affect our business, or if our estimates or assumptions turn out to be inaccurate. As a result, there is no assurance that any forward-looking statements will materialize. Risks that could cause our results to differ materially from our current expectations are discussed in section 6 of our November 12, 2014 Management''s Discussion and Analysis. We disclaim any intention or obligation to update any forward-looking statements, except as required by law, even if new information becomes available, as a result of future events or for any other reason.
Non-IFRS Measures(1)
In order to provide a better understanding of the results, the Company uses the term EBITDA, defined as income from operations before depreciation and amortization and restructuring and special charges. Management believes this measure is reflective of ongoing operations. This term is not a performance measure defined under IFRS. EBITDA does not have any standardized meaning and is therefore not likely to be comparable to similar measures used by other publicly traded companies. Management believes EBITDA to be an important measure.
Contacts:
Investor Relations
Amanda Di Gironimo
Senior Manager, Corporate Planning and Investor Relations
(514) 934-2680
Media
Fiona Story
Senior Manager, Public Relations
(514) 934-2672
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Datum: 12.11.2014 - 06:00 Uhr
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