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Reduced operating expenses and strong revenue growth in its parcel delivery business helped Postmedia Network Canada Corp. record a narrower loss in the three months ended Nov. 30, 2023, results that came despite continued declines in advertising and circulation revenue.
Postmedia, which owns media properties across Canada including the National Post and Financial Post, reported a first-quarter net loss of $10.6 million compared to a $15.9 million net loss in the corresponding period of the prior year.
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A decrease in foreign exchange losses and an increase in operating income before depreciation, amortization and restructuring contributed to the narrowed net loss.
Revenue for the quarter was $104.6 million compared to $124.2 million in the same period in the prior year, representing a 15.8 per cent decline. Advertising and circulation revenue declines were partially offset by an increase in parcel revenue of $3.6 million, or 39.1 per cent, in the first quarter.
At the same time, the company’s total operating expenses excluding depreciation, amortization and restructuring fell by $20.6 million, or 17.3 per cent compared to a year earlier.
Partly as a result of the decreases across all expense categories, operating income before depreciation, amortization, impairment and restructuring was $5.9 million, up $1 million from the same period in the prior year.
Andrew MacLeod, Postmedia’s chief executive, said the fiscal first quarter included “an important milestone” with the repayment over the past seven years of first-lien notes totalling $200 million.
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He said the repayment and subsequent refinancing of the company’s debt, alongside a recently announced new credit facility, will provide Postmedia with needed flexibility to accelerate its transformation from a traditional print media company.
The company’s new parcel distribution business was one of the highlights of the company’s operating results in the first quarter, MacLeod said, and the company’s results also benefitted from a restructuring in fiscal 2023.
In addition, he said Postmedia welcomed the federal government’s revisions to the Journalism Tax Credit and a positive settlement with Google on the Online News Act, both of which “represent material stabilizers” to Canada’s domestic media industry.
“We look forward to working with federal and provincial levels of government to implement structural reform in the Canadian media sector so the domestic industry, critical to Canadians, can regain its footing and secure our digital futures,” MacLeod said in a Jan. 10 statement issued with the first quarter financial report.
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