• E-mail
• Print
• Comment
• Font Size
• Digg
• del.icio.us
• Discuss article

Cossette - 2009 Second Quarter Results - Gross income at $55.1 million, earnings from operations at $0.1 million

Posted on: Wednesday, 6 May 2009, 16:23 CDT

KOS (TSX)

QUEBEC CITY, May 6 /PRNewswire-FirstCall/ - Cossette Inc. ("Cossette" or the "Company") recorded gross income of $55.1 million for the second quarter of fiscal 2009, ended March 31, 2009, compared to $60.1 million in the corresponding quarter of the previous fiscal year. Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)(1) amounted to $2.4 million for the second quarter of fiscal year 2009, ended March 31, 2009, compared to $4.3 million in the corresponding quarter of fiscal year 2008. For the quarter, Earnings from operations were $0.1 million, compared with $2.3 million in 2008. Net loss amounted to $0.5 million ($0.03 per share), compared to net earnings of $0.9 million ($0.05 per share) for the second quarter of 2008. For the quarter, cash flows from operating activities before changes in non-cash working capital items reached $2.0 million, compared with $4.0 million in 2008.

"During this quarter our results were visibly impacted by the negative economic environment, as were most of the businesses in our sector. In this context, we have managed with care and are taking measures to reduce our cost base while continuing to invest in our future," said Claude Lessard, Chairman of the Board, Chief Executive Officer and President. "Though in some regions performance is better than in others, we are seeking to develop new business opportunities provided by the economic context in all our markets, and to invest in the quality of our spectacular product by hiring top senior resources. With an effective and exceptional team, we expect to be well-positioned when the economic environment picks up the pace" he concluded.

The Company reports that this quarter it obtained an insurance policy minimizing its exposure to the credit risk of certain clients. This measure is part of a series of steps taken by the Company in order to reduce its financial risk and protect its current and future cash flows.

First Half Review - For the six-month period ended March 31, 2009, gross income amounted to $113.0 million, compared to $119.3 million reported in the first half of fiscal 2008. EBITDA amounted to $8.1 million for the six-month period ended March 31, 2009, compared to $11.8 million in the corresponding period of fiscal 2008. Earnings from operations for the first half of fiscal 2009 were $3.6 million as compared to $7.8 million for the same period in 2008. Net earnings in the first half of fiscal 2009 were $1.0 million ($0.06 per share) down from $4.2 million ($0.25 per share) for the same period in fiscal 2008.

Cash flows from operating activities before changes in non-cash working capital items in the first six months of fiscal 2009 were $6.7 million as compared to $9.6 million for the same period of fiscal year 2008.

Management's Discussion and Analysis, containing a full analysis of financial results, is available on SEDAR (www.sedar.com).

Cossette Inc. offers a full range of leading-edge communication services to clients of all sizes, including some of the most prestigious brands in the world. A customer-driven organization built around highly specialized business units, Cossette also offers Convergent Communications(TM), a unique working method that brings added value to the client by integrating various services offered by the Group, including strategic planning and research, advertising, media buying and channel planning, sales promotion, direct response, database and direct marketing, customer relationship management, interactive marketing and technology solutions, public relations, organizational communication and change management, sponsorship and alliance marketing, branding and design, ethnic marketing, business-to-business communications (B2B practices) and print and video production. Cossette has approximately 1,630 employees and offices in Quebec City, Montreal, Toronto, Vancouver, Halifax, New York, Irvine, Los Angeles, London and Shanghai.

Forward-looking statements - This press release may contain statements that are forward-looking in nature. These forward-looking statements may involve, but are not limited to, comments with respect to the Company's business or financial objectives, its strategies or future actions, its targets, expectations for financial condition or outlook for operations and future earn-out and additional equity interest obligations. Forward-looking statements are not guarantees of future performance and actual results may differ materially from those in the forwardlooking statements as a result of various factors, including downturns in general economic conditions and resulting changes in client business and marketing strategies, consolidation and globalization of client brand strategies, the highly competitive nature of the communications industry, the greater resources available to much larger global agencies, low entry barriers for new competitors, dependence upon a limited number of clients contributing a significant percentage of income, inability to acquire new clients or new assignments from existing clients due to client policies prohibiting performance of similar services for competing products or companies, the Company's ability to successfully integrate acquired and to-beacquired businesses and the retention of key management, creative and technical personnel. Assumptions relating to the foregoing involve judgments and risks, all of which are difficult or impossible to predict accurately and many of which are beyond the control of the Company. Although management believes that the expectations reflected in the forward-looking statements are reasonable based on information currently available, it cannot assure that the expectations will prove to have been correct. Accordingly, undue reliance should not be placed on forward-looking statements.

Financial analysts are invited to participate in a conference call with management tomorrow May 7, 2009, at 10:00 a.m. The media and any stakeholders may attend the call in listening mode only. Please dial (514) 392-9193 or 866-696-5911 (Canada & US) or 00-800-9559-6849 (Global Toll Free). A replay will be available at (514) 861-2272 or 800-408-3053, passcode 7355620# until May 23, 2009 and on the investor relations section of our website at www.cossette.com.

Appendix: Selected Financial Information

Cossette Inc. - Selected Financial Information (in thousands of Canadian dollars, except the number of shares and per share data) Results for the 3-month period ended March 31, 2009 (unaudited) 2009 2008 Gross income 55,085 60,050 Salary, general and administrative expenses 52,689 55,743 EBITDA(1) 2,396 4,307 Earnings from operations 111 2,290 Earnings before income taxes and non-controlling interest 233 2,439 Earnings after income taxes 65 1,544 Non-controlling interest (613) (672) Net earnings (loss) (548) 872 Cash flows from operations (before changes in non-cash working capital items) 2,002 3,999 Net earnings (loss) per share Basic (0.03) 0.05 Diluted (0.03) 0.05 Weighted average number of shares outstanding ('000) Basic 15,797 16,578 Diluted 15,797 16,621 Results for the 6-month period ended March 31, 2009 (unaudited) 2009 2008 Gross income 113,029 119,342 Salary, general and administrative expenses 104,970 107,543 EBITDA(1) 8,059 11,799 Earnings from operations 3,568 7,778 Earnings before income taxes and non-controlling interest 3,871 8,110 Earnings after income taxes 2,258 5,358 Non-controlling interest (1,239) (1,135) Net earnings 1,019 4,223 Cash flows from operations (before changes in non-cash working capital items) 6,670 9,638 Net earnings per share Basic 0.06 0.25 Diluted 0.06 0.25 Weighted average number of shares outstanding ('000) Basic 15,813 16,600 Diluted 16,205 16,665 Cossette Inc. - Selected Financial Information (in thousands of Canadian dollars) Balance sheet As at As at March 31, Sept. 30, 2009 2008 (unaudited) (audited) Cash and cash equivalents 24,230 13,685 Current assets 218,932 225,201 Intangible assets 5,803 5,505 Goodwill 102,298 93,122 Total assets 351,554 348,356 Short-term borrowings, including bank overdraft - 37,649 Current portion of long-term debt 12 99 Balances of purchase price of subsidiaries (current portion) 6,668 14,566 Long-term debt 25,402 219 Balances of purchase price of subsidiaries - 106 Shareholders' equity 137,260 134,212 (1) EBITDA is not a performance measure consistent with Canadian generally accepted accounting principles ("GAAP"). The information regarding measures not consistent with Canadian GAAP is contained in the Management's Discussion and Analysis filed on SEDAR.

SOURCE COSSETTE INC.

Source: PR Newswire

More News in this Category