Toronto-based media company Torstar Corp. posted significantly higher third quarter earnings, which were boosted by the sale of romance and women’s fiction publisher Harlequin Enterprises to News Corp.
The income rise includes a $97.3 million non-cash impairment charge.
Third quarter net income attributable to shareholders was $125.3 million ($1.57 per share), compared to a $70.8 million loss (0.89 cents per share) in Q3 2013.
The total includes $455 million from the Harlequin sale, as well as charges to reduce the book value of Torstar equipment, goodwill, investments in joint ventures, and property.
EBITDA (earnings before interest, taxes, depreciation and amortization) in Q3 was $16 million, which was 22.7% less than Q3 2013’s $20.7 million.
Mr. Holland said there are signs of hope regarding revenue at Metroland Media.
Torstar President and CEO, David Holland, said:
“Revenue declines exceeded the effect of continuing efforts on costs. While revenues were affected by continued shifts in spending by advertisers, pressure on revenues eased somewhat in the quarter at Metroland Media, our community media operation. We were also encouraged by the revenue growth in our digital offerings in the quarter.”
“Looking forward, for the balance of the year we expected continued challenges in print advertising revenues combined with relative stability in multi-platform subscriber revenues and flyer distribution revenues.”
Tablet product for Toronto Star
The company announced that the Toronto Star is working on an innovative new tablet product which will be launched in the fall of 2015.
In a separate statement, Torstar said the Montreal-based daily La Presse and the Toronto Star have agreed on sharing a common tablet technology which offers joint marketing opportunities to advertisers.
The company says it plans to spend between $1 million and $2 million on the project in Q4, plus a further $10-$12 million in 2015.
The Toronto Star’s plan to eliminate the paywall next year may affect circulation revenue, Torstar warned.
Regarding what to do with the Harlequin sale windfall, Mr. Holland says the company is still assessing available options.