Glacier Ventures International Corp.
TSX : GVC

Glacier Ventures International Corp.

May 15, 2006 15:00 ET

Glacier Reports Higher First Quarter Earnings

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - May 15, 2006) - Glacier Ventures International Corp. ("Glacier") (TSX:GVC) reported revenue, cash flow and earnings for the period ending March 31, 2006.

Highlights

- Completed acquisition of Hollinger Canada operations for $181 million. Acquisition significantly expands Glacier's newspaper, trade and business & professional information operations.

- Glacier's existing operations generated strong revenue and EBITA growth compared to last year.

- The newly acquired Hollinger operations generated strong revenue and EBITA growth compared to expectations.

Operating Results

For the three months ending March 31, 2006, Glacier earned $6.1 million of consolidated cash flow from operations on revenue of $40.8 million, as compared to $4.0 million on revenue of $15.1 million for the three months ended March 31, 2005. Glacier's EBITA was $9.0 million and net income was $3.4 million for the quarter, as compared to EBITA of $4.4 million and net income of $2.2 million for the same period last year.



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$000's, except share and 3 Months 3 Months
per share amounts March 31, 2006 March 31, 2005
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Revenue $ 40,842 $ 15,120
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EBITA $ 9,032 $ 4,417
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Net income $ 3,354 $ 2,198
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Cash flow from operations $ 6,090 $ 4,036
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EBITA/share $ 0.138 $ 0.172
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Cash flow from operations/share $ 0.093 $ 0.157
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Net income/share $ 0.051 $ 0.085
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Capital expenditures $ 400 $ 262
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Debt outstanding net of cash reserves $ 123,992 $ 30,408
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Shareholders' equity $ 159,647 $ 39,879
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Average shares outstanding, net 65,465,233 25,732,762
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For the three months ending March 31, 2006, consolidated cash flow from operations was $0.093 per share, EBITA was $0.138 per share and net income was $0.051 per share, as compared to $0.157 of consolidated cash flow from operations per share, $0.172 of EBITA per share and $0.085 of net income per share for the same period last year.

Per Share Performance and Outlook

Per share amounts for the quarter were reduced compared to last year due to the timing of the issuance of common shares, the borrowing of debt and the realization and seasonality of revenues and cash flows relating to the acquisition of the Hollinger Canada operations described following.

On an annualized basis, the acquisitions completed are expected to be accretive with respect to cash flow per share, EBITA per share and net income per share for the following reasons:

- In 2005, Glacier generated more than 30% of annual EBITA in the first quarter from our agricultural publications;

- By contrast, a significant amount of equity capital was raised at the beginning of 2006 to finance the Hollinger Canada operations, which historically generate more of their EBITA in the second and fourth quarters. As a result, Glacier's profit and cash flow per share amounts will be earned more evenly than was the case in prior years;

- The newly acquired Hollinger operations are outperforming initial expectations; and

- Glacier's existing operations are outperforming expectations.

To supplement the consolidated financial statements presented in accordance with Canadian generally accepted accounting principles (GAAP), the Company uses certain non-GAAP measures that may be different from the performance measures used by other companies. These non-GAAP measures include cash flow from operations (before changes in non-cash operating accounts), cash flow from operations (before changes in non-cash operating accounts) per share, earnings before interest, taxes and amortization (EBITA) and EBITA per share, which are not alternatives to GAAP financial measures. Cash flow from operations is calculated by taking net income and adding back non-cash items including amortization, future income taxes, non-controlling interest, losses on the disposal of assets and non-cash interest.

Strong Operating Performance

The overall growth in Glacier's revenue and cash flow is the result of significantly stronger operating performance from Glacier's existing operations, as well as the acquisition of the Hollinger Canada operations.

A number of sales effectiveness and cost efficiency efforts have been successfully implemented. General market growth has also resulted in stronger revenues. The newly acquired Hollinger operations were ahead of last year on both a revenue and EBITA basis.

Management is spending considerable time focusing on improving the operations that have been acquired.

Acquisition of Hollinger Canada Operations

Glacier took a significant step forward on the Canadian media landscape and the development of its business by completing a series of acquisitions with Hollinger International Inc. at year end and during the first quarter.

As previously announced, Glacier acquired 100% of Hollinger Canadian Newspapers, Limited Partnership, 100% of Eco Log Environmental Risk Information Services Ltd., 100% of the outstanding shares of KCN Capital News Company; 50% of Great West Newspaper Group Ltd. operations and 50% of Fundata Inc. operations and certain real estate assets at year end and during the quarter for $181 million. The purchase price is subject to adjustment in certain circumstances.

HCNLP owns and operates 1) the Business Information Group in Ontario, which publishes a variety of trade magazines, directories, newsletters, electronic databases and specialty websites, and 2) daily, community and specialty newspapers and printing operations in British Columbia and Quebec. KCN publishes the Merritt News and Merritt News Extra in British Columbia. Eco Log is an electronic information and report service provider that accesses key federal, provincial and private sector databases to help identify potential environmental risks in Canada for real estate developers, banks, insurance companies and a variety of other customers.

Great West publishes and prints a group of Alberta based community newspapers and publications.

Fundata provides investment fund related electronic and print information and analytics to the Canadian and global investment community and a wide variety of Canadian newspapers and media.

The acquisition of the Hollinger Canada operations fits with Glacier's strategy of growing through two core segments: 1) the business and professional information sector and 2) the newspaper and trade publication sector.

Glacier's combined daily and community newspaper group now offers distribution of approximately 1,020,000 copies across B.C., Alberta, Saskatchewan and Manitoba. Glacier's trade publication group now consists of the largest agricultural publication group in Western Canada, the Business In Vancouver Media Group, and one of Canada's largest trade magazine operations published by the Business Information Group. Glacier's business & professional information group now includes Specialty Technical Publishers which publishes regulatory & compliance information, CD-Pharma Interactive Medical Productions which develops electronic interactive continuing medical education programs for doctors, and a variety of directories, specialty websites and electronic information published by the Business Information Group.

Financing Activities

On December 30, 2005, the Company issued 17,684,210 common shares through a private placement at $2.85 per share. In February, the Company issued 10,385,965 common shares through a private placement at $2.85 per share.

During the quarter, Glacier and its subsidiaries entered into a new five year senior term loan facility with three major Canadian chartered banks for $135 million, which replaced Glacier's existing banking facility. The facility also has a $20 million revolving operating line of credit. The proceeds from these financings were used to finance the Hollinger transactions.

While Glacier's debt levels increased to finance the acquisition of the Hollinger Canada operations, the financial leverage and debt service ratios are manageable, with $15.1 million of minimum principal repayments scheduled over the next 12 months. As Glacier has done in the past, term borrowings have been increased above normal operating levels to finance a strategic acquisition in a manner that we believe maximizes shareholder value while maintaining prudent risk levels.

Financial Position

As at March 31, 2006, Glacier had consolidated cash of $11.9 million, current and long-term debt of $135.9 million and working capital of $14.3 million excluding deferred revenue. Deferred revenue relates to funds received for quarterly updates, renewals and subscriptions that have not yet been delivered.

Glacier continues to pursue further acquisition opportunities to complement its existing operations.

Shares in Glacier can be traded on the Toronto Stock Exchange under the symbol GVC.

About the Company: Glacier Ventures International Corp. is an information communications company focused on expanding across North America through both internal growth and the strategic acquisition of information communications companies that provide essential information and related services through print, electronic and online media.

Forward-Looking Statements

Certain statements in this press release are not historical and may constitute forward-looking statements reflecting financial performance. Investors are cautioned that all forward-looking statements involve risks and uncertainties. Forward-looking statements are based on management's estimates, beliefs and opinions on the date the statements are made. Glacier assumes no obligation to update forward-looking statements if circumstances should change. Additional information on these and other potential factors that could affect Glacier's financial results are detailed in documents filed from time to time with the applicable Canadian securities regulatory authorities and, in particular, are detailed under the "Business Environment and Risks" section of Management's Discussion and Analysis for the year ended December 31, 2005 and under the "Risk Factors" section of the Annual Information Form dated March 31, 2006.

The Toronto Stock Exchange has neither approved nor disapproved the form or content of this release.

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