Quebecor Inc.
TSX : QBR.A
TSX : QBR.B

Quebecor Inc.

March 10, 2010 06:30 ET

Quebecor Inc. Reports Consolidated Results for Financial Year and Fourth Quarter 2009

MONTREAL, QUEBEC--(Marketwire - March 10, 2010) - Quebecor Inc. (TSX:QBR.A)(TSX:QBR.B) ("Quebecor") today reported its annual and fourth quarter consolidated financial results for 2009. Quebecor consolidates the financial results of its Quebecor Media Inc. ("Quebecor Media") subsidiary, in which it holds a 54.7% interest.



2009 highlights

- Quebecor records revenues of $3.78 billion, up $50.9 million (1.4%) from
2008.

- Operating income(1): up $155.6 million (13.9%) to $1.28 billion.

- Net income: $277.7 million ($4.32 per basic share) in 2009, up
$89.7 million (47.7% or $1.40 per basic share).

- Telecommunications segment: operating income up $175.0 million (21.9%)
due to customer growth.

- Restructuring and other cost-reduction initiatives in the News Media
segment generate total savings of approximately $66.0 million.

Fourth quarter 2009 highlights

- Operating income(1): up $77.5 million (25.0%) to $387.6 million, with a
$62.8 million (28.8%) increase in the Telecommunications segment.

- Net income: $73.8 million ($1.15 per basic share), compared with net loss
of $343.6 million (-$5.34 per basic share) in the same quarter of 2008.

- News Media segment: operating income up $14.5 million (26.5%).


"Quebecor logged a noteworthy operational performance in 2009," said Pierre Karl Peladeau, President and Chief Executive Officer of Quebecor. "The Telecommunications segment's excellent results, propelled by customer growth for all its services, which has now continued for 18 consecutive quarters, played a significant role in the Company's strong revenues, operating income and net income. Despite the economic crisis, which has hit the media industry hard, Quebecor's diversified business model proved to be a robust driver of growth. Our restructuring programs in the News Media segment also bore fruit. Despite the substantial drop in advertising revenues in 2009, the News Media segment's operating income jumped 26.5% in the fourth quarter. The improvement bears witness to our ability to adapt our modus operandi in order to deliver economically viable news services that harness the power of new technologies.

(1) See "Operating income" under "Definitions."

"Quebecor is pushing ahead with implementation of its strategic plan aimed at producing and distributing content of the highest quality on the greatest possible number of distribution platforms in Canada. We have been a customer-driven organization for years and we will remain true to that approach in 2010 as we gear up to provide state-of-the-art wireless telephone service. We are confident that this growth sector will become a mainstay of our business plan. It will enable Quebecor to distribute its exclusive original content on a new mobile platform, promising significant opportunities for multimedia synergies and long-term growth. In the wake of our reorganization and the implementation of a new business model in the media field, we have continued our ISO (Integration, Syndication, Optimization) program and the development of the QMI Agency, which was created to aggregate and circulate news texts, photos and videos published by Quebecor's various media properties, generate new revenue streams and supply information and content to our mobile, television and print platforms. On another front, to address our customers' needs for value-added advertising solutions, we have combined our national sales forces into a new one-stop shop, the QMI National Sales Office, which will offer customers complete media solutions.

"Strengthening our positioning as a fully integrated media group will give our customers access to a full range of advanced services of the highest calibre, at a highly competitive price," said Mr. Peladeau. "Being a digital leader, supporting consumers as they change their habits and seizing the related growth opportunities are the challenges we face - challenges we fully intend to meet."



Table 1
Quebecor financial highlights, 2005 to 2009.
(in millions of Canadian dollars, except per share data)
-----------------------------------------------------------------------
-----------------------------------------------------------------------
2009 2008 2007 2006 2005
-----------------------------------------------------------------------

Revenues $3,781.0 $3,730.1 $3,365.9 $2,998.6 $2,695.4
Operating income(1) 1,276.7 1,121.1 948.8 785.5 729.6
Net income (loss) 277.7 188.0 (968.5) (94.2) 69.3
Adjusted income from
continuing operating
activities (2), (3) 236.3 179.4 134.4 97.4 54.9
Per basic share:
Net income (loss) 4.32 2.92 (15.06) (1.47) 1.07
Adjusted income
from continuing
operating
activities(2),(3) 3.68 2.79 2.09 1.51 0.85
-----------------------------------------------------------------------
(1) See "Operating income" under "Definitions."
(2) See "Discontinued operations."
(3) See "Adjusted income from continuing operating activities" under
"Definitions."


Analysis of 2009 results

- Quebecor's consolidated revenues from continuing operations rose $50.9
million (1.4%) to $3.78 billion in 2009, driven by increases in the
following segments:

- Telecommunications (up $197.0 million or 10.9% of segment revenues)
mainly because of customer growth for all services;

- Leisure and Entertainment (up $5.9 million or 2.0%).

Partially offset by:

- News Media segment (down $151.9 million or -12.9%) as a result of lower
advertising revenues

- Quebecor's operating income from continuing operations grew $155.6
million (13.9%) to $1.28 billion, mainly because of:

- $175.0 million (21.9%) increase in operating income in
Telecommunications segment;

- $14.0 million (21.2%) increase in operating income in Broadcasting
segment.

Partially offset by:

- $27.6 million (-12.2%) decrease in operating income in News Media
segment.

- Quebecor's net income was $277.7 million ($4.32 per basic share) in
2009, compared with $188.0 million ($2.92 per basic share) in 2008. The
increase of $89.7 million (47.7% or $1.40 per basic share) was mainly
due to:

- $155.6 million increase in operating income;

- $41.9 million favourable variance in gain on valuation and translation
of financial instruments;

- $40.1 million decrease in financial expenses;

- $25.0 million decrease in charge for restructuring of operations,
impairment of assets and other special items.

Partially offset by:

- $26.5 million increase in amortization charge.

The 2008 results also reflect recognition of income from discontinued
operations in the amount of $383.3 million and a $361.1 million non-cash
charge for impairment of goodwill and intangible assets, net of income
tax and non-controlling interest.

- Adjusted income from continuing operating activities: $236.3 million
in 2009 ($3.68 per basic share), compared with $179.4 million ($2.79
per basic share) in 2008, an increase of $56.9 million ($0.89 per
basic share) or 31.7%.

Analysis of fourth quarter 2009 results

- Quebecor's consolidated revenues from continuing operations were $1.03
billion, an increase of $24.4 million (2.4%). Revenue growth was
strongest in Telecommunications (up $59.4 million or 12.5% of segment
revenues) mainly because of sustained customer growth for all services.
The News Media segment's revenues decreased by $28.2 million (-9.3%).

- Quebecor's operating income from continuing operations grew $77.5
million (25.0%) to $387.6 million due to an increase in the
Telecommunications segment ($62.8 million or 28.8% of segment operating
income) resulting primarily from customer growth, and an increase in the
News Media segment ($14.5 million or 26.5%) caused essentially by a
decrease in operating costs due to, among other things, sustained
productivity improvement efforts.

The increase in operating income includes a $43.8 million favourable
variance ($34.5 million in the Telecommunications segment and $9.3
million in the Broadcasting segment) due to reversal of the provisions
for Canadian Radio-television and Telecommunications Commission ("CRTC")
Part II licence fees.

- Net income: $73.8 million ($1.15 per basic share) in the fourth quarter
of 2009, compared with a net loss of $343.6 million ($5.34 per basic
share) in the same quarter of 2008. The $417.4 million ($6.49 per basic
share) increase was mainly due to:

- recognition in the fourth quarter of 2008 of a non-cash charge
totalling $671.2 million, including $631.0 million without any tax
consequences, for impairment of goodwill and intangible assets ($361.1
million net of income tax and non-controlling interest);

- $77.5 million increase in operating income;

- $28.8 million favourable variance in provision for restructuring of
operations and other items;

- $28.2 million favourable variance in gains on valuation and
translation of financial instruments;

Partially offset by:

- $3.7 million increase in amortization charge.

- Adjusted income from continuing operating activities: $84.0 million in
the fourth quarter of 2009 ($1.31 per basic share), compared with $60.8
million ($0.95 per basic share) in the same period of 2008, an increase
of $23.2 million ($0.36 per basic share) or 38.2%.


Dividends

On March 9, 2010, the Board of Directors of Quebecor declared a quarterly dividend of $0.05 per share on Class A Multiple Voting Shares and Class B Subordinate Voting Shares, payable on April 20, 2010 to shareholders of record at the close of business on March 26, 2010. This dividend is designated to be an eligible dividend, as provided under subsection 89(14) of the Canadian Income Tax Act and its provincial counterpart.

Discontinued operations

On January 21, 2008, World Color Press, Inc. ("WCP," formerly Quebecor World Inc.) and its U.S. subsidiaries placed themselves under the protection of the Companies' Creditors Arrangement Act in Canada. On the same date, WCP's U.S. subsidiaries placed themselves under the protection of Chapter 11 of the United States Bankruptcy Code. Since that date, in accordance with generally accepted accounting principles, Quebecor's investment in WCP has no longer been consolidated, the book value of Quebecor's investment in WCP has been marked to zero, and WCP's activities are considered discontinued operations for the purposes of Quebecor's consolidated financial statements.

Detailed financial information

For a detailed analysis of Quebecor's results for the 2009 financial year and the fourth quarter of 2009, please refer to the Management Discussion and Analysis and consolidated financial statements of Quebecor, available on the Company's website at:

www.quebecor.com/InvestorCenter/QIQuarterlyReports.aspx

or from the SEDAR filing service at www.sedar.com.

Conference call for investors and webcast

Quebecor will hold a conference call to discuss the 2009 fourth quarter and financial year results of Quebecor and Quebecor Media on March 10, 2010, at 11:00 a.m. ET. There will be a question period reserved for financial analysts. To access the conference call, please dial 1 877 293-8052, access code 47448#. A tape recording of the call will be available from March 10 to April 11, 2010 by dialling 1 877 293-8133, access code 272223#. The conference call will also be broadcast live on Quebecor's website at www.quebecor.com/InvestorCenter/QIConferenceCall.aspx. It is advisable to ensure the appropriate software is installed before accessing the call. Instructions and links to free player downloads are available at the Internet address shown above.

Forward-looking statements

The statements in this press release that are not historical facts are forward-looking statements and are subject to significant known and unknown risks, uncertainties and assumptions which could cause the Company's actual results for future periods to differ materially from those set forth in the forward-looking statements. Forward looking statements may be identified by the use of the conditional or by forward-looking terminology such as the terms "plans," "expects," "may," "anticipates," "intends," "estimates," "projects," "seeks," "believes" or similar terms, variations of such terms or the negative of such terms. Certain factors that may cause actual results to differ from current expectations include seasonality (including seasonal fluctuations in customer orders), operating risk (including fluctuations in demand for Quebecor's products and pricing actions by competitors), insurance risk, risks associated with capital investment (including risks related to technological development and equipment availability and breakdown), environmental risks, risks associated with labour agreements, risks associated with commodities and energy prices (including fluctuations in the cost and availability of raw materials), credit risk, financial risks, debt risks, risks related to interest rate fluctuations, foreign exchange risks, risks associated with government acts and regulations, risks related to changes in tax legislation, and changes in the general political and economic environment. Investors and others are cautioned that the foregoing list of factors that may affect future results is not exhaustive and that undue reliance should not be placed on any forward-looking statements. For more information on the risks, uncertainties and assumptions that could cause Quebecor's actual results to differ from current expectations, please refer to Quebecor's public filings available at www.sedar.com and www.quebecor.com including, in particular, the "Risks and Uncertainties" section in Quebecor's Management Discussion and Analysis for the year ended December 31, 2009.

The forward-looking statements in this press release reflect Quebecor's expectations as of March 10, 2010, and are subject to change after that date. Quebecor expressly disclaims any obligation or intention to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable securities laws.

The Company

Quebecor Inc. (TSX:QBR.A)(TSX:QBR.B) is a holding company with a 54.7% interest in Quebecor Media Inc., one of Canada's largest media groups. Quebecor Media owns operating companies in numerous media related businesses: Videotron Ltd., an integrated communications company engaged in cable television, interactive multimedia development, Internet access services, cable telephony and wireless telephone service; Sun Media Corporation, the largest publisher of newspapers in Canada; Canoe Inc., operator of a network of English- and French-language Internet properties in Canada; TVA Group Inc., operator of the largest French-language over-the-air television network in Quebec, a number of specialty channels, and the English-language over-the-air station Sun TV; Nurun Inc., a major interactive technologies and communications agency with offices in Canada, the United States, Europe and Asia; magazine publisher TVA Publishing Inc.; book publishers and distributors Sogides Group Inc. and CEC Publishing Inc.; Archambault Group Inc. and TVA Films, companies engaged in the production, distribution and retailing of cultural products; Le SuperClub Videotron ltee, a DVD and console game rental and retail chain; and Quebecor MediaPages, publisher of print and online directories.

FINANCING ACTIVITIES

In 2009 and the beginning of 2010, Quebecor Media strengthened its financial position, optimized its liquidity position and extended the average maturity of its debt. The following financing activities were carried out:

- On March 5, 2009, Videotron Ltd. ("Videotron") issued US$260.0 million aggregate principal amount of Senior Notes for net proceeds of $332.4 million (including accrued interest and net of financing fees). The Notes bear 9 1/8% interest (effective rate of 9.35%) and mature on April 15, 2018. Videotron used the proceeds to repay all drawings under its revolving credit facility and the remainder for general purposes.

- On November 13, 2009, Videotron closed a term export credit agreement for a total of US$100.0 million, including $75.0 million maturing in 2018 and another credit agreement maturing in 2016 for US$100 million less the drawings, in U.S. dollars, on the $75.0 million credit facility. The credit facilities may be used to pay or reimburse foreign purchases of equipment and services.

- On November 20, 2009, Quebecor amended its annual revolving short-term credit facility. Commitments under the facility were reduced from $191.3 million to $150.0 million and the maturity date was extended to November 2010. If the facility is not renewed in 2010, the drawings will be converted to one-year term credit.

- On January 13, 2010, Videotron completed a placement of $300 million aggregate principal amount of its 7 1/8% Senior Notes maturing in 2020, for net proceeds of $293.9 million (net of financing fees). This transaction marks Videotron's inaugural offering on the Canadian high yield market, adding to its established presence in the US high yield market.

- On January 14, 2010, Quebecor Media made a US$170.0 million early payment on drawings on its term loan "B" maturing in 2013 and settled a corresponding portion of its hedge agreements for $30.9 million, for a total cash disbursement of $206.7 million. On January 14, 2010, Quebecor Media also extended the maturity date of its $100 million revolving credit facility from January 2011 to January 2013 and obtained certain other advantageous amendments to the covenants attached to its credit facilities.

DEFINITIONS

Operating income

In its analysis of operating results, the Company defines operating income, as reconciled to net income (loss) under Canadian generally accepted accounting principles ("Canadian GAAP"), as net income (loss) before amortization, financial expenses, gain on valuation and translation of financial instruments, charge for restructuring of operations, impairment of assets and other special items, loss on debt refinancing, impairment of goodwill and intangible assets, income tax, non-controlling interest and the results of discontinued operations. Operating income as defined above is not a measure of results that is consistent with Canadian GAAP. It is not intended to be regarded as an alternative to other financial operating performance measures or to the statement of cash flows as a measure of liquidity. It should not be considered in isolation or as a substitute for measures of performance prepared in accordance with Canadian GAAP. Management believes that operating income is a meaningful measure of performance. The Company uses operating income in order to assess the performance of its investment in Quebecor Media. The Company's management and Board of Directors use this measure in evaluating its consolidated results as well as the results of the Company's operating segments. This measure eliminates the significant level of depreciation and amortization of tangible and intangible assets and is unaffected by the capital structure or investment activities of the Company and its segments. Operating income is also relevant because it is a significant component of the Company's annual incentive compensation programs. A limitation of this measure, however, is that it does not reflect the periodic costs of tangible and intangible assets used in generating revenues in the Company's segments. The Company also uses other measures that do reflect such costs, such as cash flows from segment operations and free cash flows from operations. In addition, measures like operating income are commonly used by the investment community to analyze and compare the performance of companies in the industries in which the Company is engaged. The Company's definition of operating income may not be the same as similarly titled measures reported by other companies. Table 2 below reconciles Quebecor's operating income with the closest Canadian GAAP measure.



Table 2
Reconciliation of the operating income measure used in this press release
to the net income (loss) measure used in the consolidated financial
statements
(in millions of Canadian dollars)

Years Three months
ended ended
December 31 December 31
2009 2008 2007 2009 2008
-------------------------------------------------------------------------

Operating income:
Telecommunications $972.9 $797.9 $642.3 $280.9 $218.1
News Media 199.5 227.1 232.8 69.3 54.8
Broadcasting 80.0 66.0 59.4 32.2 22.5
Leisure and Entertainment 25.9 20.2 26.9 8.4 11.0
Interactive Technologies and
Communications 4.1 5.1 2.8 1.4 3.0
Head Office (5.7) 4.8 (15.4) (4.6) 0.7
-------------------------------------------------------------------------
1,276.7 1,121.1 948.8 387.6 310.1
Amortization (344.7) (318.2) (288.3) (87.5) (83.8)
Financial expenses (259.0) (299.1) (253.3) (70.2) (72.1)
Gain (loss) on valuation
and translation of
financial instruments 59.7 17.8 137.0 2.4 (25.8)
Restructuring of
operations, impairment
of assets and other
special items (29.6) (54.6) (12.2) (21.5) (50.3)
Impairment of goodwill
and intangible assets (13.6) (671.2) (5.4) - (671.2)
Income tax (153.2) (140.4) (92.4) (59.1) (30.9)
Non-controlling interest (260.2) 149.3 (160.9) (77.9) 280.4
Income (loss) from
discontinued operations 1.6 383.3 (1,241.8) - -
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Net income (loss) $277.7 $188.0 $(968.5) $73.8 $(343.6)
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-------------------------------------------------------------------------


Adjusted income from continuing operating activities

Quebecor defines adjusted income from continuing operating activities, as reconciled to net income under Canadian GAAP, as net income before gain on valuation and translation of financial instruments, charge for restructuring of operations and other special items, impairment of goodwill and intangible assets, and the results of discontinued operations, net of income tax and non controlling interest. Adjusted income from continuing operating activities as defined above is not a measure of results that is consistent with Canadian GAAP. It should not be considered in isolation or as a substitute for measures of performance prepared in accordance with Canadian GAAP. Management believes that adjusted income from continuing operating activities is a meaningful measure that provides an indication of the long term profitability of Quebecor's operating activities by eliminating the impact of unusual or one time items. Quebecor's definition of adjusted income from continuing operating activities may not be identical to similarly titled measures reported by other companies.

Table 3 provides a reconciliation of adjusted income from continuing operating activities to the net income (loss) measure used in Quebecor's consolidated financial statements.



Table 3
Reconciliation of the adjusted income from continuing operating activities
measure used in this press release with the net income (loss) measure
reported in the consolidated financial statements
(in millions of Canadian dollars)

Years Three months
ended ended
December 31 December 31
2009 2008 2007 2009 2008
-------------------------------------------------------------------------

Adjusted income from
continuing operating
activities $236.3 $179.4 $134.4 $84.0 $60.8
Gain (loss) on valuation
and translation of
financial instruments 59.7 17.8 137.0 2.5 (25.8)
Charge for restructuring of
operations, impairment of
assets and other special
items (29.6) (54.6) (12.2) (21.5) (50.3)
Impairment of goodwill and
intangible assets (13.6) (671.2) (5.4) - (671.2)
Income tax related to
adjustments1 38.9 3.8 14.2 3.6 7.3
Non-controlling interest
related to adjustments (15.6) 329.5 5.3 5.2 335.6
Income (loss) from
discontinued operations 1.6 383.3 (1,241.8) - -
-------------------------------------------------------------------------
Net income (loss) $277.7 $188.0 $(968.5) $73.8 $(343.6)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(1) Includes the impact of fluctuations in tax rates applicable to
adjusted items, either for statutory reasons or in connection with tax
planning arrangements.


Average monthly revenue per user

ARPU is an industry metric that the Company uses to measure its average cable, Internet, cable telephone and wireless telephone revenues per month per customer. ARPU is not a measurement that is consistent with Canadian GAAP and the Company's definition and calculation of ARPU may not be the same as identically titled measurements reported by other companies. The Company calculates ARPU by dividing its combined cable television, Internet access, cable telephone and wireless telephone revenues by the average number of customers during the applicable period, and then dividing the resulting amount by the number of months in the applicable period.



QUEBECOR INC. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in millions of Canadian dollars,
except for earnings per share Years
data) Three months ended ended
(unaudited) December 31 December 31
--------------------------------------------------------------------------
--------------------------------------------------------------------------
2009 2008 2009 2008
--------------------------------------------------------------------------
(restated) (restated)

Revenues

Telecommunications $532.9 $473.5 $2,001.2 $1,804.2
News Media 273.8 302.0 1,029.5 1,181.4
Broadcasting 128.5 126.9 439.0 436.7
Leisure and Entertainment 95.5 100.4 307.8 301.9
Interactive Technologies and
Communications 23.5 24.0 91.0 89.6
Inter-segment (27.2) (24.2) (87.5) (83.7)
--------------------------------------------------------------------------
1,027.0 1,002.6 3,781.0 3,730.1

Operating expenses 639.4 692.5 2,504.3 2,609.0
Amortization 87.5 83.8 344.7 318.2
Financial expenses 70.2 72.1 259.0 299.1
(Gain) loss on valuation and
translation of financial (2.4) 25.8 (59.7) (17.8)
instruments
Restructuring of operations,
impairment of assets and other 21.5 50.3 29.6 54.6
special items
Impairment of goodwill and
intangible assets - 671.2 13.6 671.2
--------------------------------------------------------------------------
Income (loss) before income taxes
and non-controlling interest 210.8 (593.1) 689.5 (204.2)
Income taxes:
Current 15.5 11.5 29.7 12.7
Future 43.6 19.4 123.5 127.7
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59.1 30.9 153.2 140.4
--------------------------------------------------------------------------
151.7 (624.0) 536.3 (344.6)
Non-controlling interest (77.9) 280.4 (260.2) 149.3
--------------------------------------------------------------------------
Income (loss) from continuing
operations 73.8 (343.6) 276.1 (195.3)
Income from discontinued
operations - - 1.6 383.3
--------------------------------------------------------------------------
Net income (loss) $73.8 $(343.6) $277.7 $188.0
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Earnings per share
Basic
From continuing operations $1.15 $(5.34) $4.30 $(3.04)
From discontinued operations - - 0.02 5.96
Net income (loss) 1.15 (5.34) 4.32 2.92
Diluted
From continuing operations $1.12 $(5.34) $4.26 $(3.04)
From discontinued operations - - 0.02 5.96
Net income (loss) 1.12 (5.34) 4.28 2.92
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Weighted average number of shares
outstanding (in millions) 64.3 64.3 64.3 64.3
Weighted average number of diluted
shares (in millions) 64.7 64.4 64.7 64.4
--------------------------------------------------------------------------
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QUEBECOR INC. AND ITS SUBSIDIARIES
SEGMENTED INFORMATION
Three months
(in millions of Canadian dollars) ended Years ended
(unaudited) December 31 December 31
-------------------------------------------------------------------------
-------------------------------------------------------------------------
2009 2008 2009 2008
-------------------------------------------------------------------------
(restated) (restated)
Income from continuing operations
before amortization, financial
expenses, (gain) loss on
valuation and translation of
financial instruments,
restructuring of operations and
other special items, impairment
of goodwill and intangible
assets, income taxes and
non-controlling interest
Telecommunications $280.9 $218.1 $972.9 $797.9
News Media 69.3 54.8 199.5 227.1
Broadcasting 32.2 22.5 80.0 66.0
Leisure and Entertainment 8.4 11.0 25.9 20.2
Interactive Technologies and
Communications 1.4 3.0 4.1 5.1
Head Office (4.6) 0.7 (5.7) 4.8
-------------------------------------------------------------------------
$387.6 $310.1 $1,276.7 $1,121.1
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Amortization
Telecommunications $67.2 $56.9 $254.4 $226.4
News Media 11.6 16.9 57.3 62.1
Broadcasting 4.1 3.7 14.8 13.9
Leisure and Entertainment 2.9 3.7 9.9 9.5
Interactive Technologies and
Communications 0.9 1.4 4.0 4.3
Head Office 0.8 1.2 4.3 2.0
-------------------------------------------------------------------------
$87.5 $83.8 $344.7 $318.2
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Additions to property, plant and
equipment
Telecommunications $116.1 $91.4 $434.1 $356.7
News Media 13.2 13.3 33.4 77.1
Broadcasting 3.7 4.9 16.5 17.8
Leisure and Entertainment 2.1 3.3 3.6 8.9
Interactive Technologies and
Communications 0.5 1.0 3.1 3.6
Head Office 1.4 5.4 4.0 15.5
-------------------------------------------------------------------------
$137.0 $119.3 $494.7 $479.6
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Additions to intangible assets
Telecommunications $21.1 $27.6 $89.9 $614.7
News Media 0.8 2.2 10.3 11.4
Broadcasting 2.9 1.6 7.0 4.1
Leisure and Entertainment 0.6 2.1 4.0 7.4
Interactive Technologies and
Communications 0.1 - 0.3 -
-------------------------------------------------------------------------
$25.5 $33.5 $111.5 $637.6
-------------------------------------------------------------------------
Externally acquired intangible
assets $17.3 $21.9 $69.5 $593.8
Internally generated
intangible assets 8.2 11.6 42.0 43.8
-------------------------------------------------------------------------
$25.5 $33.5 $111.5 $637.6
-------------------------------------------------------------------------
-------------------------------------------------------------------------



QUEBECOR INC. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in millions of Canadian dollars) Three months ended Years ended
(unaudited) December 31 December 31
--------------------------------------------------------------------------
--------------------------------------------------------------------------
2009 2008 2009 2008
--------------------------------------------------------------------------
(restated) (restated)
Net income (loss) $73.8 $(343.6) $277.7 $188.0

Other comprehensive (loss)
income:
Unrealized (loss) gain on
translation of net
investments in foreign (1.3) 4.3 (3.3) 5.0
operations
Loss on valuation of
derivative financial (35.6) (15.5) (8.2) (16.7)
instruments
Income taxes related to
derivative financial
instruments 18.9 (36.7) 41.6 (47.9)
Non-controlling interest 8.2 21.9 (13.6) 27.4
Reclassification to income
of other comprehensive loss
related to discontinued
operations, net of income
taxes of $14.8 million - - - 326.5
--------------------------------------------------------------------------
(9.8) (26.3) 16.5 294.3
--------------------------------------------------------------------------
Comprehensive income (loss) $64.0 $(369.9) $294.2 $482.3
--------------------------------------------------------------------------
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QUEBECOR INC. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

(in millions of Canadian dollars)
(unaudited)
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Accumulated
other Total
Capital Contributed Retained comprehensive shareholders'
stock surplus earnings (loss) income equity
--------------------------------------------------------------------------
Balance as of
December 31,
2007, as
previously
reported $346.6 $- $391.5 $(321.8) $416.3
Cumulative
effect of
changes in
accounting
policies - - (1.3) - (1.3)
--------------------------------------------------------------------------
Balance as of
December 31,
2007, as 346.6 - 390.2 (321.8) 415.0
restated
Net income - - 188.0 - 188.0
Dividends - - (12.9) - (12.9)
Other
comprehensive
income - - - 294.3 294.3
--------------------------------------------------------------------------
Balance as of
December 31,
2008, as
restated 346.6 - 565.3 (27.5) 884.4
Net income - - 277.7 - 277.7
Dividends - - (12.9) - (12.9)
Related party
transactions - 4.7 - - 4.7
Other
comprehensive
income - - - 16.5 16.5
--------------------------------------------------------------------------
Balance as of
December 31,
2009 $346.6 $4.7 $830.1 $(11.0) $1,170.4
--------------------------------------------------------------------------
--------------------------------------------------------------------------



QUEBECOR INC. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions of
Canadian dollars) Three months ended Years ended
(unaudited) December 31 December 31
--------------------------------------------------------------------------
--------------------------------------------------------------------------
2009 2008 2009 2008
--------------------------------------------------------------------------
(restated) (restated)
Cash flows related to operating
activities
Income (loss) from continuing
operations $73.8 $(343.6) $276.1 $(195.3)
Adjustments for:
Amortization of property, plant
and equipment 75.5 73.4 295.8 278.7
Amortization of intangible
assets and other assets 12.0 10.4 48.9 39.5
Impairment of goodwill and
intangible assets - 671.2 13.6 671.2
Impairment of property, plant
and equipment - 19.1 0.4 19.1
(Gain) loss on valuation and
translation of financial
instruments (2.4) 25.8 (59.7) (17.8)
Amortization of financing costs
and long-term debt discount 2.7 2.6 10.2 9.3
Future income taxes 43.6 19.4 123.5 127.7
Non-controlling interest 77.9 (280.4) 260.2 (149.3)
Other 4.2 (0.2) 4.6 (0.3)
--------------------------------------------------------------------------
287.3 197.7 973.6 782.8
Net change in non-cash
balances related to
operating activities 25.8 91.3 (48.3) (27.5)
--------------------------------------------------------------------------
Cash flows provided by
continuing operating
activities 313.1 289.0 925.3 755.3
Cash flows provided by
discontinued operating
activities - - - 20.5
--------------------------------------------------------------------------
Cash flows provided by
operating activities 313.1 289.0 925.3 775.8
--------------------------------------------------------------------------
Cash flows related to investing
activities
Business acquisitions, net
of cash and cash
equivalents - - (4.6) (146.7)
Business disposals, net of
cash and cash equivalents 1.9 4.8 14.6 6.4
Additions to property,
plant and equipment (137.0) (119.3) (494.7) (479.6)
Additions to intangible
assets (25.5) (33.5) (111.5) (637.6)
Net change in temporary
investments (29.8) - (29.8) -
Other 1.9 3.5 3.8 4.3
--------------------------------------------------------------------------
Cash flows used in
continuing investing
activities (188.5) (144.5) (622.2) (1,253.2)
Cash flows used in
discontinued investing
activities and cash and
cash equivalents of WCP
at the date of
deconsolidation - - - (117.7)
--------------------------------------------------------------------------
Cash flows used in investing
activities (188.5) (144.5) (622.2) (1,370.9)
--------------------------------------------------------------------------
Cash flows related to financing
activities
Net change in bank
indebtedness (25.1) (28.4) (10.5) (4.6)
Issuance of long-term debt,
net of financing fees 73.6 3.1 399.1 466.7
Net change under revolving
and bridge bank facilities (80.1) (84.7) (294.1) 106.2
Repayments of long-term
debt (18.0) (4.4) (54.9) (25.7)
Dividends (3.3) (3.3) (12.9) (12.9)
Dividends paid to non-
controlling shareholders (9.1) (18.7) (36.5) (32.4)
Other (2.8) (0.1) (2.7) 2.6
--------------------------------------------------------------------------
Cash flows (used in)
provided by continuing
financing activities (64.8) (136.5) (12.5) 499.9
Cash flows provided by
discontinued financing
activities - - - 37.3
--------------------------------------------------------------------------
Cash flows (used in) provided
by financing activities (64.8) (136.5) (12.5) 537.2
--------------------------------------------------------------------------
Net change in cash and cash
equivalents 59.8 8.0 290.6 (57.9)

Effect of exchange rate changes
on cash and cash equivalents
denominated in foreign
currencies - (0.1) (0.6) 1.4
Cash and cash equivalents at
beginning of period 240.2 2.1 10.0 66.5
--------------------------------------------------------------------------
Cash and cash equivalents at
end of period $300.0 $10.0 $300.0 $10.0
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Cash and cash equivalents
consist of
Cash $26.0 $10.0 $26.0 $10.0
Cash equivalents 274.0 - 274.0 -
--------------------------------------------------------------------------
$300.0 $10.0 $300.0 $10.0
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Continuing operations
Cash interest payments $103.9 $99.0 $293.8 $299.1
Cash income tax payments
(net of refunds) 3.9 4.5 17.0 24.4
--------------------------------------------------------------------------
--------------------------------------------------------------------------



QUEBECOR INC. AND ITS SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

(in millions of Canadian dollars)
(unaudited)
------------------------------------------------------------------------
------------------------------------------------------------------------
December 31 December 31
2009 2008
------------------------------------------------------------------------
(restated)
Assets

Current assets
Cash and cash equivalents $300.0 $10.0
Cash and cash equivalents in trust 5.3 5.3
Temporary investments 30.0 0.2
Accounts receivable 519.8 484.4
Income taxes 1.3 9.4
Inventories 176.1 193.5
Prepaid expenses 29.1 31.5
Future income taxes 49.8 115.2
------------------------------------------------------------------------
1,111.4 849.5

Property, plant and equipment 2,498.6 2,272.9
Intangible assets 1,052.7 985.9
Derivative financial instruments 49.0 317.9
Other assets 122.5 101.7
Future income taxes 12.5 12.3
Goodwill 3,506.1 3,516.7
------------------------------------------------------------------------
$8,352.8 $8,056.9
------------------------------------------------------------------------
------------------------------------------------------------------------
Liabilities and shareholders' equity
Current liabilities

Bank indebtedness $1.8 $12.3
Accounts payable and accrued charges 794.6 788.6
Deferred revenue 234.7 224.0
Income taxes 16.3 9.8
Current portion of long-term debt 68.6 42.3
------------------------------------------------------------------------
1,116.0 1,077.0

Long-term debt 3,811.9 4,407.1
Derivative financial instruments 422.4 117.3
Other liabilities 129.4 117.0
Future income taxes 485.9 469.1
Non-controlling interest 1,216.8 985.0

Shareholders' equity
Capital stock 346.6 346.6
Contributed surplus 4.7 -
Retained earnings 830.1 565.3
Accumulated other comprehensive loss (11.0) (27.5)
------------------------------------------------------------------------
1,170.4 884.4
Subsequent event
------------------------------------------------------------------------
$8,352.8 $8,056.9
------------------------------------------------------------------------
------------------------------------------------------------------------

Contact Information

  • Quebecor Inc.
    Jean-Francois Pruneau
    Vice President, Finance
    514-380-4144
    or
    Quebecor Inc.
    Isabelle Dessureault
    Vice President, Public Affairs
    514-380-7501