Quebecor Reports 2000 Results, Creates $747 Million Free Cash Flow
Press release from the issuing company
Montreal, Canada – 2/7/01 Quebecor World Inc. is pleased to announce its fourth quarter and year-end results. The Company’s successful integration of the World Color acquisition along with its focus on improving economies of scale and operating efficiencies, have resulted in record results for both the fourth quarter of 2000 and the fiscal year. The operating performance also generated free cash flow of $747 million, an all-time high.
For the fourth quarter ended December 31, 2000 net income before special charges improved 28% to reach $104.4 million, or $0.70 per share, compared with $81.4 million, or $0.58 per share, for the fourth quarter of 1999. The quarter to quarter results are fully comparable for the first time, because the fourth quarter of 1999 includes three months of World Color results.
“We exceeded all our commitments,” said Charles G. Cavell, President and Chief Executive Officer of Quebecor World. “These results demonstrate the strength of this industry and the true power of our company within it. What we’ve been able to accomplish this year, married with the still significant opportunities for greater internal efficiencies and the increasing demand for printed products in all our businesses makes me even more optimistic about our future growth.”
At year-end, Quebecor World had achieved a debt-to-capitalization ratio of 47:53, compared to a peak of over 62:38 at the time of the World Color acquisition. During the year, the Company focused the majority of its free cash flow from operations, approximately $600 million, on paying down the acquisition debt.
“This fiscal year was our first following the World Color acquisition. We have successfully integrated two industry leaders. Our strategy of creating larger more specialized facilities geographically located to optimize distribution has paid off. The resulting platform is so efficient we have increased our synergies and cost savings target to almost $110 million to be fully realized next year,” said Mr. Cavell. “This new level of achievement allows us to focus on the exploration of new opportunities for growth across our entire platform. With our strong balance sheet and the exceptional free cash flow performance of the corporation we are actively accessing accretive acquisitions in all three continents in which we operate.”
Quebecor World achieved these results even though energy prices increased dramatically and foreign currency translation impacted both revenues and operating income.
These factors were particularly true for our European operations where a weak Euro and the costs related to equipment movement have overshadowed an improving performance in challenging market conditions.
Several refinancing initiatives were taken throughout the year, the total proceeds of which were also used to repay acquisition debt.
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