Quebecor Reports Record First Quarter 2001 Results, Double Digit Growth in EPS
Press release from the issuing company
Montreal, Quebec - 4/30/01- Quebecor World Inc. is pleased to announce for the quarter ending March 31, 2001 earnings per share of $0.27 an increase of 13% over the same period last year. Net income also increased 13% to $42.5 million and the operating margin increased to 8.7%. All are records for the quarter.
"Every quarter since the merger with World Color we have delivered record earnings and margins," said Charles G. Cavell, President and CEO of Quebecor World. "These latest results were achieved despite a significant slowdown in the U.S. economy and soaring energy costs. It shows that our diversified product strategy and global footprint place Quebecor World in a unique position to successfully deal with challenging market conditions."
Synergies from the World Color merger and additional cost containment initiatives allowed the North American platform to increase operating income by 5% in the first quarter even though revenue was down by 5%. These decisions have also put Quebecor World in a strong position to take full advantage when the U.S. economy rebounds. The Company continues to harvest the efficiencies available to it as the world's largest commercial print media provider.
In Europe, management continues to focus on strengthening the French platform while expanding pan European sales and marketing activities to take advantage of the company's unique continental reach. Revenues and operating income improved compared to the same quarter last year, excluding the unfavourable effect of currency translation.
Latin American revenues increased 34% and operating income was up 12% over the previous year's first quarter. The company's strategy of growing internationally with strong customers in expanding markets moved ahead in the first quarter with the initial printing of Veja Magazine for Editora Abril in the new Recife facility. Veja, the world's fourth largest news magazine can now be distributed in timely fashion throughout North East Brazil thus saving the publisher significant time and distribution costs. Production of telephone directories for Listel Listas Telefonicas S.A. will begin in the second quarter.
In March, Quebecor World issued $250 million of Senior Notes to a group of private U.S. investors to completely repay the bank debt incurred for the World Color acquisition. Quebecor World is now positioned to resume its role as the industry's leading consolidator.
"We are looking at opportunities in all our geographies," said Mr. Cavell. "There are a number of options we are studying but the goal is to grow and strengthen our business. Substantial growth in Europe, South America and North America will be realized in the coming years."
The Company recently made two niche acquisitions. In Brazil, Quebecor World purchased 75% of Graphica Melhoramentos. The Sao Paulo based company has annual sales of $16 million printing trade and textbooks, magazines, directories and catalogs.
In Spain, Quebecor World purchased a controlling interest in Espacio y Punto. This is a leading pre-media company located in Madrid. This acquisition will strengthen the relationships that many of Spain's largest magazine and catalogue publishers have with our Altair printing facility. It gives Quebecor World a European pre-media platform to develop along the lines of those employed in North America under Que-Net MediaTM.
"While there is slowdown in the U.S. economy from which we are not immune, we will continue focusing management resources to diminish the impact on our business", said Mr. Cavell. "We are moving ahead with the completion of the World Color integration and we will continue to look for ways to make our business stronger".
In April, Quebecor World reported it had repurchased 4,940,000 Subordinate Voting Shares at an average cost per share of CDN$35.26 under its Normal Course Issuer Bid instituted April 6, 2000. At the same time the Company renewed its Normal Course Issuer Bid for a maximum of 8,800,000 Subordinate Voting Shares representing approximately 10% of the public float as of March 26, 2001. Purchases will be made between April 6, 2001 and April 5, 2002. Shares repurchased under the bid will be cancelled.
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