Glacier Media Q2 profit falls as former Postmedia papers squeeze profit margins

Source:  thetyee.ca

VANCOUVER – Newspaper publisher Glacier Media Inc. (TSX:GVC) says its profit margins have been squeezed by community papers acquired last year from Postmedia.

The Vancouver-based company’s net income fell to $5.3 million or six cents per share in the third quarter, down from $7 million or eight cents per share a year earlier, before the deal with Postmedia.

Revenue increased, however, due largely to the addition of the Victoria Times-Colonist and other former Postmedia papers starting in November as well as growth at Glacier’s business and trade information operations.

Glacier Media’s total revenue was $91.4 million, up from $71.7 million in the second quarter of 2011. Comparing assets that Glacier has owned for at least a year, consolidated revenue was relatively flat.

Glacier’s consolidated EBITDA (earnings before interest, taxes, depreciation and amortization) was $17.1 million, up 12.1 per cent from $15.3 million a year earlier.

Glacier said its consolidated EBITDA margin decreased to 18.7 per cent for the quarter from 21.3 per cent for the same quarter last year as a result of the lower margins of the Postmedia assets acquired.

“Management will seek to improve the margins and profit performance of the assets acquired through improved print and digital sales effectiveness, cost efficiency and other initiatives,” the company said.

Meanwhile GVIC Communication Corp. (TSX:GCT), a related company, reported separately that it had $5.2 million or 1.7 cents per share of net income attributable to shareholders with $91.4 million of revenue.

A year earlier,GVIC had $71.7 million of revenue and $7.7 million or 2.6 cents per share of net income attributable to common shareholders.