Torstar Corporation
TSX : TS.B

Torstar Corporation

March 03, 2010 06:30 ET

Torstar Corporation Reports Increase in Fourth Quarter Earnings

TORONTO, ONTARIO--(Marketwire - March 3, 2010) - Torstar Corporation (TSX:TS.B) today reported financial results for the fourth quarter and full year ended December 31, 2009.

Highlights for the quarter:



-- Revenue was $394.8 million in the quarter, down $17.6 million or 4.3%
from the fourth quarter of 2008. Excluding the $6.6 million decline from
the strengthening Canadian dollar, revenue was down $11.0 million or
2.7%, comparing favourably with the 7.7% year to date decline (also
excluding the impact of foreign exchange) through the end of the third
quarter.

-- EBITDA (operating profit, as presented on the consolidated statements of
income which is before charges for interest and taxes, adjusted for
depreciation and amortization of intangible assets, and restructuring
and other charges - see "non-GAAP measures") was $69.6 million in the
quarter, up $8.3 million from $61.3 million in the fourth quarter of
2008.

-- Net income was $57.4 million or $0.73 per share compared with a loss of
$213.9 million or $2.71 per share in the same period last year.
Excluding the impact of impairment losses and investment write-downs
related to associated businesses of $2.3 million ($0.03 per share) in
the fourth quarter of 2009 and $236.2 million ($2.99 per share) in 2008,
net income was $59.7 million or $0.76 per share in 2009 and $22.3
million or $0.28 per share in 2008.

-- Net debt was $515.8 million at December 31, 2009, down $37.5 million
from $553.3 million at September 30, 2009.



Highlights for the year:



-- Revenue was $1,451.3 million in 2009, down $82.5 million from $1,533.8
million in 2008. This decline was net of a $16.5 million increase from a
weaker year over year Canadian dollar.

-- EBITDA was $191.8 million, down $21.4 million from $213.2 million in
2008.

-- Net income was $35.6 million or $0.45 per share in 2009 compared with a
loss of $181.5 million or $2.30 per share in 2008. Excluding the impact
of impairment losses and investment write-downs related to associated
businesses of $16.5 million ($0.21 per share) in 2009 and $236.2 million
($2.99 per share) in 2008, net income was $52.1 million or $0.66 per
share in 2009 and $54.7 million or $0.69 per share in 2008.

-- Net debt was $515.8 million at December 31, 2009, down $111.5 million
from $627.3 million at December 31, 2008.



"We were very pleased with our fourth quarter operating results and the year as a whole given the economic conditions," said David Holland, President and Chief Executive Officer of Torstar Corporation. "EBITDA was up versus prior year in the quarter as Harlequin continued to perform very strongly and the newspapers and digital division reported an increase in EBITDA for the first time this year. In the newspapers and digital division the challenging economic environment continued to have an impact on revenues but the fourth quarter did represent improvement relative to the year-to-date experience. We continue to be very disciplined on cost and the ongoing restructuring efforts are mitigating the impact of the revenue decline. Harlequin closed the year very well. Including favourable exchange impact, Harlequin achieved annual growth in EBITDA of $15.7 million or 22% versus prior year despite the difficult global economic environment. This represents Harlequin's third consecutive year of growth."

"We are particularly pleased with the significant progress we achieved in reducing our net borrowings by $111 million from $627 million at the end of 2008 to $516 million by the end of 2009. This progress reflects the strong cash flow characteristics of our franchises and management's discipline in approaching the employment of capital."

"Looking forward, we continue to be concerned about the impact of the economy on the newspapers and digital revenue base. While there are some signs of relative improvement in early 2010, we remain cautious as the economic recovery remains fragile. For Harlequin, after three years of growth we are expecting stable results in 2010."

The following chart provides a continuity of earnings per share from 2008 to 2009:



----------------------------------------------------------------------------
----------------------------------------------------------------------------
Fourth Quarter Year to Date
----------------------------------------------------------------------------
Net loss per share 2008 ($2.71) ($2.30)
Discontinued operations 0.03 0.29
------------------------------
Loss from continuing operations 2008 ($2.68) ($2.01)
Changes
- Operations 0.09 (0.12)
- Restructuring provisions (0.01) (0.03)
- Income (loss) from associated
businesses
o Impairments 1.75 1.57
o Other 0.31 (0.13)
Investment write-down and loss
o Associated businesses 1.21 1.21
o Other (0.01) 0.02
- Gain on sale of land (0.09)
- Impairment of intangible assets 0.02 0.02
- Non-cash foreign exchange (0.02) (0.03)
- Change in statutory tax rates 0.07 0.04
----------------------------------------------------------------------------
Net income per share 2009 $0.73 $0.45
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OPERATING RESULTS - THREE MONTHS ENDED DECEMBER 31, 2009

Overall Performance

Total revenue was $394.8 million in the fourth quarter of 2009, down $17.6 million or 4.3% from $412.4 million in the fourth quarter of 2008. Newspapers and Digital revenue was $272.6 million, down $13.5 million or 4.7% from $286.1 million in the same period last year. The fourth quarter was the strongest revenue performance in 2009 with some signs that the Ontario economy may be improving. Book Publishing revenues were $122.2 million in the fourth quarter of 2009, down $4.0 million from $126.2 million in the same period last year. This included a decrease of $6.6 million from the impact of the strengthening Canadian dollar partially offset by an increase in underlying revenues of $2.6 million. The North America Direct-To-Consumer and Overseas divisions had revenue growth in the fourth quarter while North America Retail was down slightly.

Operating profit before restructuring and other charges was $55.8 million in the fourth quarter of 2009, up $7.7 million from $48.1 million in the fourth quarter of 2008. Including the $13.0 million of restructuring and other charges, operating profit was $42.8 million in the fourth quarter of 2009, up $7.8 million from $35.0 million in the fourth quarter of 2008 (which included $13.1 million of restructuring and other charges). Newspapers and Digital Segment operating profit was $39.2 million in the fourth quarter of 2009, up $1.6 million from $37.6 million in the same period last year as net cost savings more than offset the impact of lower revenues. Book Publishing operating profits were $20.7 million in the fourth quarter, up $6.4 million from $14.3 million in the same period last year. The increase included $0.7 million from the impact of foreign exchange and $5.7 million from operating profit increases in all three Book Publishing divisions. Corporate costs were $4.1 million in the fourth quarter of 2009, up $0.3 million from $3.8 million in the fourth quarter of 2008 reflecting higher variable compensation costs.

EBITDA, excluding restructuring and other charges, was $69.6 million in the fourth quarter, up $8.3 million from $61.3 million in the same period last year.



----------------------------------------------------------------------------
Fourth Quarter Fourth Quarter
2009 2008
----------------------------------------------------------------------------
Newspapers and Digital $51,985 $49,514
Book Publishing 21,701 15,581
Corporate (4,081) (3,754)
----------------------------------------------------------------------------
EBITDA, excluding restructuring and other
charges $69,605 $61,341
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Restructuring and other charges

Restructuring and other charges of $13.0 million were recorded in the fourth quarter of 2009 including restructuring provisions of $12.3 million in the Newspapers and Digital Segment and a $0.7 million impairment loss on certain community newspapers mastheads. In 2008, the restructuring and other charges of $13.1 million included $10.7 million of restructuring provisions and a $2.4 million impairment loss on certain community newspapers mastheads and customer relationship intangible assets.

Total annualized savings from the fourth quarter 2009 restructuring activities are expected to be approximately $7.2 million (with approximately $5.6 million to be realized in 2010 and $1.6 million to be realized in 2011) with a reduction of approximately 117 positions.

Interest

Interest expense was $5.1 million in the fourth quarter of 2009, down $1.5 million from $6.6 million in the fourth quarter of 2008. The lower expense reflects lower average levels of debt and lower effective interest rates during the fourth quarter of 2009. The average net debt (long-term debt and bank overdraft net of cash and cash equivalents) was $534.5 million in the fourth quarter of 2009, down $89.8 million from $624.3 million in 2008. Torstar's effective interest rate was 3.8% in the fourth quarter of 2009 and 4.2% in the fourth quarter of 2008.

Foreign exchange gain (loss)

Torstar reported a non-cash foreign exchange loss of $0.5 million in the fourth quarter of 2009. This loss arose from the translation of foreign-currency (primarily U.S. dollars) denominated assets and liabilities into Canadian dollars. The amount of the gain or loss in any year will vary depending on the movement in relative value of the Canadian dollar and on whether Torstar has a net asset or net liability position in the foreign currency. In 2008, a non-cash foreign exchange gain of $0.4 million was reported.

Income (loss) from associated businesses

Income (loss) from associated businesses was income of $30.4 million in the fourth quarter of 2009 compared with a loss of $137.7 million in the fourth quarter of 2008.

Torstar's share of CTVgm's net income was $30.3 million in the fourth quarter compared with a loss of $114.2 million in the same period last year. Excluding the impact of non-operating and non-recurring items, Torstar would have reported income of $10.5 million in the fourth quarter of 2009 and income of $9.7 million in 2008. The higher results in 2009 reflected improved revenue trends and operating cost reductions that were partially offset by higher amortization and interest expense.

CTVgm's non-operating and non-recurring items included impairment losses on intangible assets and goodwill, a gain on the change in the fair value of financial liabilities, a partial recovery of the valuation allowance against certain of CTVgm's future income tax assets, a gain on the sale of CTVgm's interest in Maple Leaf Sports and Entertainment Ltd., and a $4.2 million positive earnings impact as future income tax liabilities related to intangible assets were reduced to reflect the reduction in future provincial income tax rates.

The impairment losses related to intangible assets and goodwill were $2.3 million in the fourth quarter of 2009 and $124.2 million in the fourth quarter of 2008. The impairment losses were calculated based primarily on the income approach which used discounted cash flows to determine the fair value of an intangible asset or reporting unit. The 2009 impairment losses related to certain of CTVgm's television assets while the 2008 impairment losses also included an impairment loss on goodwill. The larger losses in 2008 reflected the impact the economy was having on the media industry in Canada and the outlook for CTVgm's businesses at that time.

During the fourth quarter, Torstar completed its annual impairment testing for the CTVgm intangible assets including broadcast licences, masthead and customer relationships, that were identified on the investment by Torstar. Torstar also completed an assessment of the value of its investment in CTVgm to determine if there has been an other than temporary decline in the value relative to its carrying value. An impairment loss of $2.3 million (as noted above) was recorded in the fourth quarter in relation to certain broadcast licences. Torstar determined that there was not an other than temporary decline in the value of its investment in CTVgm in 2009 and therefore no impairment loss was required to be recorded. In the fourth quarter of 2008, an impairment loss of $96.6 million was recorded in relation to certain broadcast licences and a masthead (included in the $124.2 million discussed above) and a $95.7 million write-down was recorded to reflect an other than temporary decline in the carrying value.

Torstar is not currently recording its share of Black Press's results. Torstar's carrying value in Black Press was reduced to nil in the fourth quarter of 2008 as a result of impairment losses related to Black Press's U.S. newspaper operations. While under Canadian accounting rules a negative carrying value is not recorded, the deficit must be recovered prior to the reporting of any further results. Torstar's share of Black Press's income would have been $0.9 million in the fourth quarter of 2009, compared with a loss of $1.4 million in 2008 (excluding the impact of the impairment loss of $21.8 million recorded in 2008). Operating results were higher in 2009 as cost reductions and net gains on the mark to market of financial derivatives more than offset lower revenues.

Investment write-down and loss

During the fourth quarter of 2009, Torstar recognized an investment write-down of $2.4 million reducing the carrying value of its portfolio investment in Vocel Inc. to nil. In the fourth quarter of 2008, Torstar recognized an investment write-down of $97.4 million. This included a $95.7 million write-down of its investment in CTVgm and a $1.7 million write-down of its investment in Vocel Inc. These write-downs in both years represented an other than temporary decline in the carrying value of these investments.

Income and other taxes

Torstar's effective tax rate was 12.0% in the fourth quarter of 2009. This included the positive impact of not tax affecting the $30.4 million income from associated businesses and a $5.1 million benefit from changes in statutory tax rates. During 2009, the Ontario provincial government enacted corporate tax decreases for future years. Under Canadian generally accepted accounting principles the impact of these changes on Torstar's future income tax assets and liabilities is to be recorded during the period the tax changes are substantially enacted. Excluding the impact of these two items, Torstar's effective tax rate would have been 37.1% in the fourth quarter. In 2008, Torstar reported a fourth quarter tax provision of $5.4 million on a loss before taxes of $206.3 million. Torstar's effective tax rate was 38.0% in the fourth quarter of 2008 (excluding the impact of the loss from associated businesses and investment write-down and loss, which were not fully tax affected). The effective tax rate was lower in the fourth quarter of 2009 primarily from the impact of permanent differences in calculating income taxes year over year.

Income (loss) from continuing operations

Torstar reported income from continuing operations of $57.4 million or $0.73 per share in the fourth quarter of 2009 compared with a loss from continuing operations of $211.7 million or $2.68 per share in the fourth quarter of 2008. Impairment losses and investment write-downs related to associated businesses were $2.3 million or $0.03 per share in the fourth quarter of 2009 and $236.2 million or $2.99 per share in the same period last year. Excluding these items, Torstar had income from continuing operations of $59.7 million or $0.76 per share in the fourth quarter of 2009 and $24.5 million or $0.31 per share in 2008.

Discontinued operations

Transit TV ceased operations in early 2009 and the two Transit TV subsidiaries filed a voluntary petition for relief under Chapter 7 of the United States Bankruptcy Code. Accordingly, the Transit TV results for 2008 have been restated to be shown as discontinued operations.

Net income (loss)

Torstar reported net income of $57.4 million or $0.73 per share in the fourth quarter of 2009 compared with a net loss of $213.9 million or $2.71 per share in the fourth quarter of 2008. The average number of Class A and Class B non-voting shares outstanding was 79.0 million in the fourth quarter of 2009 up slightly from 78.9 million in the fourth quarter of 2008.

Segment Results - Newspapers and Digital

The following tables set out, in $000's, the results for the reporting units within the Newspapers and Digital Segment for the three months ended December 31, 2009 and 2008.



----------------------------------------------------------------------------
2009 2008
----------------------------------------------------------------------------
Metroland Star Metroland Star
Media Media Total Media Media Total
----------------------------------------------------------------------------

Operating
revenue $143,594 $128,966 $272,560 $151,626 $134,519 $286,145

EBITDA $28,993 $22,992 $51,985 $32,952 $16,562 $49,514
Depreciation &
amortization 4,194 8,589 12,783 4,102 7,817 11,919
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Operating
profit $24,799 $14,403 $39,202 $28,850 $8,745 $37,595
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EBITDA margin 20.2% 17.8% 19.1% 21.7% 12.3% 17.3%
Operating
profit
margin 17.3% 11.2% 14.4% 19.0% 6.5% 13.1%
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Newspapers and Digital revenues were down $13.5 million or 4.7% in the fourth quarter of 2009. This was an improvement over the first three quarters of 2009 (when revenues were down 11.5% year to date) as the Ontario economy started to show some signs of improvement which was reflected in improved advertising revenue trends. Over 75% of the decline in advertising revenue in the fourth quarter related to employment and real estate advertising categories. Digital revenues grew 12.7% in the fourth quarter as the growth in several new sites more than offset lower revenues related to online employment advertising. Digital revenues were 7.6% of the total Newspapers and Digital revenue in the fourth quarter of 2009, up from 6.4% in the fourth quarter of 2008.

EBITDA was up $2.5 million in the fourth quarter as savings in labour costs of $8.2 from restructuring initiatives and lower newsprint costs more than offset lower revenues, $5.5 million of higher pension costs and investment in the digital operations. Newsprint consumption was down in the quarter from a combination of reduced copies and paging. Newsprint prices were 19.0% lower compared with the fourth quarter of 2008. Operating profit was up $1.6 million in the quarter.

Metroland Media Group

Metroland Media Group revenues were $143.6 million in the fourth quarter of 2009 down $8.0 million or 5.3% from $151.6 million in the fourth quarter of 2008. This was an improvement from the third quarter when revenues were down 12.1% year to date. The decline was the result of lower print advertising revenues partially offset by higher distribution and digital revenues. The community newspapers continued to see weakness in the classified (particularly employment), real estate and local retail categories during the fourth quarter but the declines were less significant than in the previous three quarters. The daily newspapers had a similar experience during the fourth quarter but had improved results for national advertisers including automotive and government.

Metroland Media Group's expenses were lower in the fourth quarter with lower newsprint costs (volume and pricing) and labour cost savings of $5.2 realized from restructuring efforts more than offsetting $1.3 million of higher pension costs and the ongoing investment in Metroland's digital properties.

Metroland Media Group's EBITDA was $29.0 million in the fourth quarter of 2009 down $4.0 million from $33.0 million in the fourth quarter of 2008 as the net cost savings were not quite sufficient to offset the revenue declines. The 12.1% decline in EBITDA from the fourth quarter of last year was the strongest quarterly performance in 2009. Metroland Media Group's operating profit was $24.8 million in the fourth quarter of 2009 down $4.1 million from $28.9 million in 2008.

Star Media Group

Star Media Group revenues were $129.0 million in the fourth quarter of 2009, down $5.5 million from $134.5 million in the fourth quarter of 2008 as advertising revenue declines moderated with some signs that the Ontario economy was improving. This 4.1% decline was an improvement over the 10.8% year to date decline realized through the first three quarters.

Toronto Star print advertising revenues were down 6.5% in the fourth quarter which was the best performance of 2009. Print advertising revenues were down 17.0% year to date through the third quarter. National advertising was up year over year in the fourth quarter while the retail and classified categories continued to be weak. Categories such as classified continued to be affected by structural pressures. Revenues at Star Media Group's digital properties were flat in the fourth quarter as the lower declines in online employment advertising were offset by growth in Olive Media and other digital properties. This was an improvement from the first three quarters of 2009 when the larger declines in employment advertising more than offset the growth in the other properties.

Revenues for the jointly-owned Metro newspapers were up significantly in the quarter with strong growth in all markets. Sing Tao revenues were flat in the quarter reflecting an improvement in advertising revenue compared with the first three quarters of 2009.

Star Media Group expenses were down in the fourth quarter of 2009 as lower newsprint costs, labour savings of $3.0 million from restructuring efforts and general cost-containment efforts more than offset $4.2 million of higher pension costs and the continued investment in the digital businesses.

Star Media Group EBITDA was $23.0 million in the fourth quarter of 2009, up $6.4 million from $16.6 million in the fourth quarter of 2008 as the net cost savings more than offset the revenue declines. Star Media Group operating profit was $14.4 million in the fourth quarter of 2009 up $5.7 million from $8.7 million in the fourth quarter of 2008.

Segment Results - Book Publishing

The following tables set out, in $000's, a summary of operating results for the Book Publishing Segment and a continuity of revenue and operating profit, including the impact of foreign currency movements, for the three months ended December 31, 2009 and 2008.



----------------------------------------------------------------------------
2009 2008
----------------------------------------------------------------------------
Revenue $122,225 $126,206

EBITDA $21,701 $15,581
Depreciation & amortization 1,048 1,264
-----------------------------------
Operating profit $20,653 $14,317
-----------------------------------

EBITDA margin 17.8% 12.3%
Operating profit margin 16.9% 11.3%
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----------------------------------------------------------------------------
Fourth Quarter
----------------------------------------------------------------------------
Reported revenue, prior year $126,206
Impact of currency movements and foreign exchange
contracts (6,604)
Change in underlying revenue 2,623
----------------------------------------------------------------------------
Reported revenue, current year $122,225
----------------------------------------------------------------------------

Reported operating profit, prior year $14,317
Impact of currency movements and foreign exchange
contracts 658
Change in underlying operating profit 5,678
----------------------------------------------------------------------------
Reported operating profit, current year $20,653
----------------------------------------------------------------------------


Book Publishing revenues were up $2.6 million in the fourth quarter of 2009 excluding the impact of foreign exchange. North America Retail was down $0.9 million, North America Direct-To-Consumer was up $1.6 million and Overseas was up $1.9 million.

Book Publishing operating profits were up $5.7 million in the fourth quarter of 2009 excluding the impact of foreign exchange. North America Retail was up $2.5 million, North America Direct-To-Consumer was up $1.5 million and Overseas was up $1.7 million.

North America Retail operating profit was up $2.5 million in the fourth quarter of 2009 on $0.9 million of lower revenues. The revenue decline is primarily related to the year over year impact of adjustments to prior period returns provisions in the quarter. Offsetting the revenue declines were cost savings including lower promotional spending, freight and overheads.

North America Direct-To-Consumer operating profits were up $1.5 million in the fourth quarter of 2009 on $1.6 million of higher revenues. The revenue growth was evenly split between direct mail and digital revenues and was partially offset by a decline related to a product line that was discontinued at the end of 2008. Operating profit growth was also evenly split between the direct mail and digital businesses.

Overseas operating profit was up $1.7 million in the fourth quarter of 2009 on $1.9 million of revenue growth. The revenue growth in the fourth quarter continued the full year trend of higher digital revenues in Japan from the agreement with SoftBank Creative Corp., and higher revenues in the Nordic and Holland operations offset by lower revenues in Japan's print book business and the U.K.'s direct mail and retail series businesses. Operating profits in the fourth quarter also continued to benefit from the contribution from the digital sales in Japan as well as from lower advertising and promotional costs and reduced overheads across most of the markets.

OPERATING RESULTS - YEAR ENDED DECEMBER 31, 2009

Overall Performance

Total revenue was $1,451.3 million in 2009, down $82.5 million or 5.4% from $1,533.8 million in 2008. Newspapers and Digital revenue was $958.0 million in 2009, down $102.8 million or 9.7% from $1,060.8 million in 2008 as the weak Ontario economy caused significant declines in advertising revenue. Book Publishing revenue was $493.3 million in 2009, up $20.4 million from $472.9 million in 2008 including a $16.5 million increase from the weaker year over year Canadian dollar. Overseas revenues were up in the year, more than offsetting declines in North America Retail. North America Direct-To-Consumer revenues were flat in the year.

Operating profit before restructuring and other charges was $139.0 million in 2009, down $20.9 million from $159.9 million in 2008. Including the $43.7 million of restructuring and other charges, operating profit was $95.3 million in 2009, down $22.9 million from $118.2 million in 2008 (which included $41.7 million of restructuring and other charges). Newspapers and Digital Segment operating profit was $70.2 million in 2009, down $39.1 million from $109.3 million in 2008 as labour and newsprint cost savings offset only a portion of the revenue decline and higher pension costs. Book Publishing operating profit was $83.8 million in 2009, up $16.3 million from $67.5 million in 2008 including a $5.8 million increase from the impact of foreign exchange. Operating profits were up in all three Book Publishing divisions in the year. Corporate costs were $15.0 million in 2009, down $1.9 million from $16.9 million in 2008 primarily reflecting lower compensation costs.

EBITDA, excluding restructuring and other charges, was $191.8 million in 2009, down $21.4 million from $213.2 million in 2008.



----------------------------------------------------------------------------
2009 2008
----------------------------------------------------------------------------
Newspapers and Digital $118,527 $157,554
Book Publishing 88,187 72,472
Corporate (14,913) (16,840)
----------------------------------------------------------------------------
EBITDA, excluding restructuring and other charges $191,801 $213,186
----------------------------------------------------------------------------


Restructuring and other charges

Restructuring and other charges of $43.7 million were recorded in 2009 including restructuring provisions of $43.0 million and a $0.7 million impairment loss on certain community newspapers mastheads. The restructuring provisions in 2009 included $12.8 million related to the transition in leadership at Torstar Corporate, $28.8 million for restructuring provisions in the Newspapers and Digital Segment and $1.4 million related to the closure of a distribution centre in Harlequin's U.K. operation. In 2008, the restructuring and other charges of $41.7 million included restructuring provisions in the Newspaper and Digital Segment of $39.3 million and a $2.4 million impairment loss on certain community newspapers mastheads and customer relationship intangible assets.

Both Star Media Group and Metroland Media Group have undertaken several restructuring initiatives in 2008 and 2009 in order to reduce ongoing operating costs. Total annualized savings from the 2009 restructuring activities are expected to be approximately $27.6 million (with approximately $12.7 million realized during 2009, $13.3 million to be realized in 2010 and $1.6 million to be realized in 2011) and a reduction of approximately 452 positions. Total annualized savings from the 2008 restructuring activities were approximately $30.0 million ($8.3 million realized in 2008 and $21.7 million realized in 2009) and a reduction of approximately 506 positions.

Late in the first quarter of 2009, Harlequin announced the decision to close its direct-to-consumer distribution centre in the U.K. and to outsource that function. This will result in annual savings of $0.6 million (with $0.2 million realized during 2009) and a reduction of approximately 16 positions.

Interest

Interest expense was $21.0 million in 2009, down $7.2 million from $28.2 million in 2008. The lower expense reflects lower average levels of debt and lower effective interest rates. The average net debt (long-term debt and bank overdraft net of cash and cash equivalents) was $587.8 million in 2009, down $41.1 million from $628.9 million in 2008. Torstar's effective interest rate was 3.6% in 2009 and 4.5% in 2008.

Net debt was $515.8 million at December 31, 2009, down $111.5 million from $627.3 million at December 31, 2008.

Foreign exchange gain (loss)

Torstar reported a non-cash foreign exchange loss of $0.5 million in 2009. This loss arose from the translation of foreign-currency (primarily U.S. dollars) denominated assets and liabilities into Canadian dollars. The amount of the gain or loss in any year will vary depending on the movement in relative value of the Canadian dollar and on whether Torstar has a net asset or net liability position in the foreign currency. In 2008, a non-cash foreign exchange gain of $0.4 million was reported.

Income (loss) from associated businesses

Income (loss) from associated businesses was a loss of $18.0 million in 2009 down from a loss of $136.9 million in 2008.

Torstar's share of CTVgm's net loss was $17.8 million in 2009 compared with a loss of $110.6 million in 2008. Excluding the impact of non-operating and non-recurring items, Torstar would have reported a loss of $4.3 million in 2009 and income of $9.8 million in 2008. The lower results in 2009 reflected the impact the soft Canadian economy had on the media industry, and in particular, on advertising revenue. CTVgm was able to offset a portion of the revenue decline through cost reductions. Higher amortization and interest expenses also reduced net earnings in 2009.

CTVgm's non-operating and non-recurring items included impairment losses on intangible assets and goodwill, a recovery in 2009 (provision in 2008) related to Canadian Radio-television and Telecommunications Commission ("CRTC") Part II licence fees, a gain on the change in the fair value of financial liabilities, a $4.2 million positive earnings impact as future income tax liabilities related to intangible assets were reduced to reflect the reduction in future provincial income tax rates and a $26.3 million valuation allowance (negative earnings impact) that was provided against certain of CTVgm's future income tax assets.

The impairment losses related to intangible assets and goodwill were $16.5 million in 2009 and $124.2 million in 2008. The impairment losses were calculated based primarily on the income approach which used discounted cash flows to determine the fair value of an intangible asset or reporting unit. The 2009 impairment losses related to certain of CTVgm's television and radio intangible assets while the 2008 impairment losses also included an impairment loss on goodwill. The larger losses in 2008 reflected the impact the economy was having on the media industry in Canada and the outlook for CTVgm's businesses at that time.

The issue of the legality of the Part II fees has been on-going for several years. In April 2008, the Federal Court of Appeal reversed a prior decision of the Federal Court and found that the fees were a valid regulatory charge. In the second quarter of 2008, CTVgm provided for the Part II licence fees for fiscal 2007 and year to date fiscal 2008. In December 2008, the Supreme Court of Canada granted the Canadian Association of Broadcasters ("CAB") leave to appeal the Part II licence fee case and in January 2009 the CAB's notice of appeal was filed. During this period CTVgm continued to accrue Part II fees and the CRTC had issued a notice indicating that they would not collect any Part II fees until the matter was resolved. During the summer of 2009, preliminary discussions were held between the CAB and the Federal Government regarding a negotiated settlement to the case. In early October 2009, the Canadian Federal Government announced that they had reached an agreement with the CAB regarding the Part II licence fees. Under the settlement, past amounts owing by the broadcasters for fiscal 2007, 2008 and 2009 will be forgiven, a new, forward-looking fee regime will be developed and the CAB agreed to discontinue its court action. As a result of the settlement, CTVgm reversed all its accruals related to Part II fees.

During the fourth quarter, Torstar completed its annual impairment testing for the CTVgm intangible assets including broadcast licences, masthead and customer relationships, that were identified on the investment by Torstar. Torstar also completed an assessment of the value of its investment in CTVgm to determine if there has been an other than temporary decline in the value relative to its carrying value. An impairment loss of $2.3 million was recorded in the fourth quarter of 2009 in relation to certain broadcast licences (included in the $16.5 million discussed above). Torstar determined that there was not an other than temporary decline in the value of its investment in CTVgm in 2009 and therefore no impairment loss was required to be recorded. In 2008, an impairment loss of $96.6 million was recorded in relation to certain broadcast licences and masthead (included in the $124.2 million discussed above) and a $95.7 million write-down was recorded to reflect an other than temporary decline in the carrying value.

Torstar is not currently recording its share of Black Press's results. Torstar's carrying value in Black Press was reduced to nil in the fourth quarter of 2008 as a result of impairment losses related to Black Press's U.S. newspaper operations. While under Canadian GAAP a negative carrying value is not recorded, any deficit must be recovered prior to the reporting of any further results. Excluding the impact of the impairment losses, Torstar's share of Black Press's income would have been $2.5 million in 2009, compared with a loss of $4.5 million in 2008. The improvement in Black Press's net income was related to lower interest expense, net gains on the mark to market of financial derivatives and lower tax expense. Operating results were lower in 2009 as the weak North American economy reduced advertising revenues that were not fully offset by cost reductions.

Gain on sale of land

Torstar recognized a gain of $0.2 million in 2009 related to the sale of a small property in Cambridge. In 2008, Torstar recognized a gain of $9.2 million on the disposition of excess land in Vaughan. The proceeds from the 2008 sale included a $6.2 million mortgage which was originally scheduled to mature in December 2009 but has been extended to September 2010.

Investment write-down and loss

During 2009, Torstar recognized an investment write-down of $2.4 million reducing the carrying value of its portfolio investment in Vocel Inc. to nil. In 2008, Torstar recognized an investment write-down and loss of $99.8 million. This included a $95.7 million write- down of its investment in CTVgm and a $1.7 million write-down of its investment in Vocel Inc. These write-downs in both years represented an other than temporary decline in the carrying value of these investments. Also during 2008, Torstar realized a loss of $2.4 million on the sale of its portfolio investment in U.S. based LiveDeal, Inc.

Income and other taxes

Torstar's effective tax rate was 33.6% in 2009. This included the negative impact of not tax affecting the $18.0 million loss from associated businesses offset by a $5.1 million benefit from changes in statutory tax rates. During 2009, the Ontario provincial government enacted corporate tax decreases for future years. Under Canadian generally accepted accounting principles the impact of these changes on Torstar's future income tax assets and liabilities is to be recorded during the period the tax changes are substantially enacted. Excluding the impact of these two items, Torstar's effective tax rate would have been 32.2%. In 2008, Torstar reported a 2008 tax provision of $21.5 million on a loss before taxes of $137.2 million. Torstar's effective tax rate was 28.8% in 2008 (excluding the impact of the loss from associated businesses and investment write-down and loss, which were not fully tax affected and a one-time positive adjustment of $1.3 million for a recovery of prior period taxes). The effective tax rate was higher in 2009 primarily from the impact of permanent differences in calculating income taxes year over year.

Income (loss) from continuing operations

Torstar reported income from continuing operations of $35.6 million or $0.45 per share in 2009 compared with a loss from continuing operations of $158.7 million or $2.01 per share in 2008. Impairment losses and investment write-downs related to associated businesses were $16.5 million or $0.21 per share in 2009 and $236.2 million or $2.99 per share in 2008. Excluding these items, Torstar had income from continuing operations of $52.1 million or $0.66 per share in 2009 and $77.5 million or $0.98 per share in 2008.

Discontinued operations

Transit TV ceased operations in early 2009 and the two Transit TV subsidiaries filed a voluntary petition for relief under Chapter 7 of the United States Bankruptcy Code. Accordingly, the Transit TV results for 2008 have been restated to be shown as discontinued operations.

Net income (loss)

Torstar reported net income of $35.6 million or $0.45 per share in 2009 compared with a net loss of $181.5 million or $2.30 per share in 2008. The average number of Class A and Class B non-voting shares outstanding was 79.0 million in 2009 up slightly from 78.8 million in 2008.

Segment Operating Results - Newspapers and Digital

The following tables set out, in $000's, the results for the reporting units within the Newspapers and Digital Segment for the years ended December 31, 2009 and 2008.



----------------------------------------------------------------------------
2009 2008
----------------------------------------------------------------------------

Metroland Star Metroland Star
Media Media Total Media Media Total
----------------------------------------------------------------------------

Operating
revenue $513,298 $444,658 $957,956 $572,433 $488,403 $1,060,836

EBITDA $86,917 $31,610 $118,527 $114,219 $43,335 $157,554
Depreciation &
amortization 16,501 31,872 48,373 15,926 32,323 48,249
--------------------------------------------------------------
Operating
profit $70,416 ($262) $70,154 $98,293 $11,012 $109,305
--------------------------------------------------------------

EBITDA margin 16.9% 7.1% 12.4% 20.0% 8.9% 14.9%
Operating
profit
margin 13.7% n/a 7.3% 17.2% 2.3% 10.3%
----------------------------------------------------------------------------


Total revenue of the Newspapers and Digital Segment was $958.0 million in 2009, down $102.8 million or 9.7% from $1,060.8 million in 2008. Over 52% of the decline in advertising revenue in the year related to two categories that are especially vulnerable to the economic cycle, employment and real estate advertising. The Ontario economy was weak throughout most of 2009 with some signs of improvement in the fourth quarter. Digital revenues grew only 1.6% in 2009, as online employment advertising revenues were negatively impacted by the economy offsetting other digital revenue growth. Digital revenues were 6.9% of the total Newspapers and Digital revenue in 2009, up from 6.2% in 2008.

EBITDA was down $39.1 million in the year as lower revenues, $21.8 million of higher pension costs and investment in the digital operations more than offset savings in labour costs of $34.4 million from restructuring initiatives and lower newsprint costs. Newsprint consumption was down in the year from a combination of reduced copies and paging. Newsprint prices were 5.0% lower year over year. Operating profit was down $39.1 million in the year.

Metroland Media Group

Metroland Media Group revenues were $513.3 million in 2009 down $59.1 million from $572.4 million in 2008. Revenues were lower at both the community and daily newspapers in 2009 as the weak Ontario economy had a negative impact on advertising revenues. Lower employment and real estate advertising accounted for approximately 58% of the decline in advertising revenue during the year. Advertising revenue declines improved in the fourth quarter as the economy showed some signs of improvement. Distribution revenues were up slightly in the year as higher rates more than offset slightly lower volumes. Metroland Media Group distributed just under 3.5 billion pieces during 2009. Metroland's digital revenues were up $5.8 million in the year as existing sites' revenues continued to grow and several new sites were launched and acquired.

Metroland Media Group expenses were down in 2009 as labour cost savings of $20.8 million realized from restructuring efforts and lower newsprint costs (both volume and pricing) more than offset $4.7 million of higher pension costs and the continued investment in the digital properties.

Metroland Media Group's EBITDA was $86.9 million in 2009 down $27.3 million from $114.2 million in 2008 as net cost savings of $31.8 million were not sufficient to offset the $59.1 million revenue decline. Metroland Media Group's operating profit was $70.4 million in 2009 down $27.9 million from $98.3 million in 2008.

Star Media Group

Star Media Group revenues were $444.7 million in 2009, down $43.7 million or 8.9% from $488.4 million in 2008 as the weak Ontario economy had a negative impact on advertising revenue. This was particularly true for employment and real estate advertising which accounted for 49% of the decline in total advertising revenues for the year. The declines were lower in the fourth quarter across the Star Media Group businesses.

Toronto Star print advertising revenues were down 14.1% in 2009. This is an improvement from the third quarter year to date decline of 17.0% as the rate of decline decreased in the fourth quarter to 6.5%. The annual declines were realized across most categories with the most significant declines in the retail and classified categories. Categories such as classified continued to be affected by structural pressures. Toronto Star circulation revenues were up in the year. Revenues at Star Media Group's digital properties were down in the year as declines in employment advertising (primarily Workopolis) more than offset growth in Olive Media and eyeReturn Marketing.

Revenues for the jointly-owned Metro newspapers were up in the year with growth in advertising revenue in all markets. Sing Tao revenues were down in the year as it faced similar advertising revenue challenges that the Star faced including weak employment and real estate advertising.

Star Media Group expenses were down in 2009 as lower newsprint costs, labour savings of $13.6 million from restructuring efforts and general cost-containment efforts more than offset $17.1 million of higher pension costs and the continued investment in the digital businesses.

Star Media Group EBITDA was $31.6 million in 2009, down $11.7 million from $43.3 million in 2008 as net cost savings of $32.0 million offset a significant portion of the $43.7 million revenue decline. Star Media Group reported an operating loss of $0.3 million in 2009, compared with an operating profit of $11.0 million in 2008.

Segment Operating Results - Book Publishing

The following tables set out, in $000's, a summary of operating results for the Book Publishing Segment and a continuity of revenue and operating profit, including the impact of foreign currency movements, for the years ended December 31, 2009 and 2008.



----------------------------------------------------------------------------
2009 2008
----------------------------------------------------------------------------
Revenue $493,303 $472,917

EBITDA $88,187 $72,472
Depreciation & amortization 4,390 4,961
-----------------------------------
Operating profit $83,797 $67,511
-----------------------------------


EBITDA margin 17.9% 15.3%

Operating profit margin 17.0% 14.3%
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Reported revenue, prior year $472,917
Impact of currency movements and foreign exchange contracts 16,539
Change in underlying revenue 3,847
----------------------------------------------------------------------------
Reported revenue, current year $493,303
----------------------------------------------------------------------------

Reported operating profit, prior year $67,511
Impact of currency movements and foreign exchange contracts 5,777
Change in underlying operating profit 10,509
----------------------------------------------------------------------------

Reported operating profit, current year $83,797
----------------------------------------------------------------------------


Book Publishing revenues were up $3.8 million in 2009 excluding the impact of foreign exchange. North America Retail was down $3.6 million, North America Direct-To-Consumer was flat and Overseas was up $7.4 million.

Book Publishing operating profits were up $10.5 million in 2009 excluding the impact of foreign exchange. North America Retail was up $1.0 million, North America Direct-To-Consumer was up $5.9 million and Overseas was up $3.6 million.

North America Retail operating profits were up $1.0 million in 2009 despite a $3.6 million decline in revenue. The year over year revenue decline included a lower positive adjustment to prior year returns provisions in 2009 compared with 2008 and a reduction in the number of books sold (partially related to market disruptions from the bankruptcy of a distributor and U.S. retail store closings). Offsetting the revenue declines were cost savings including lower advertising and promotional spending, freight and overheads.

North America Direct-To-Consumer operating profits were up $5.9 million in 2009 on flat revenues. Digital revenues were up $4.0 million in the year while direct mail revenues were flat with volume declines offset by higher prices. Offsetting the digital revenue growth was a decline related to a product line that was discontinued at the end of 2008. Operating profits benefited from lower customer acquisition costs in the direct mail business and the higher digital revenues.

Overseas operating profit was up $3.6 million in 2009 on $7.4 million of revenue growth. The revenue growth included higher digital revenues in Japan from the agreement with SoftBank Creative Corp., (a division of Softbank Corp., one of the largest providers of cell phone services in Japan) to distribute digital manga (comic) content on cell phones and Internet distribution sites and higher revenues in the Nordic and Holland operations. These revenue increases were partially offset by lower revenues in Japan's print book business and challenges in the U.K.'s direct mail and retail series businesses. Operating profits benefited from the higher contribution from the digital sales in Japan as well as from lower advertising and promotional costs and reduced overheads across most of the markets.

OUTLOOK

Torstar's outlook for 2010 is cautious given the continued uncertainty in the economy.

Revenue growth in the Newspapers and Digital Segment will be largely dependent on continued economic improvement. Should that occur, the businesses will benefit from the lower cost base achieved from restructuring efforts over the past two years. Revenue declines moderated during the fourth quarter of 2009, and early 2010 revenues are relatively flat compared to the weak start last year. This may signal a return to a more stable revenue performance in 2010. On the cost side, the Segment will benefit from $13.3 million of labour cost savings from restructuring activities undertaken in 2009, $9.7 million of lower pension expense and slightly lower newsprint pricing. Torstar has arrangements in place with its suppliers that will fix the price for the majority of Torstar's newsprint requirements in 2010.

After realizing significant growth in 2009, Harlequin's 2010 results are expected to be stable. Harlequin benefited from the Softbank digital agreement and cost reductions in all areas of the business in 2009. The Softbank contribution is expected to decline in 2010 but growth in other markets, both print and digital, is anticipated to offset this decline. Changes in the value of the U.S. dollar relative to the Canadian dollar will have an impact on Harlequin's 2010 earnings. In 2009, including the impact of the U.S. dollar contracts, Harlequin's U.S. dollar earnings were translated at a rate of approximately $1.13. For 2010, Torstar has U.S. dollar contracts for $45.6 million U.S. dollars at an average exchange rate of $1.17. The balance of Harlequin's U.S. earnings in 2010 will be translated at the average exchange rates realized during the year.

Torstar's effective interest rate will increase in 2010 due to the higher interest rate spread that will be applicable to borrowings under its long-term credit facility.

OTHER

On March 2, 2010, Torstar declared a quarterly dividend of 9.25 cents per share on its Class A shares and Class B non-voting shares, payable on March 31, 2010, to shareholders of record at the close of business on March 12, 2010. Torstar advises that, for the purposes of the Income Tax Act, Canada and for any relevant provincial tax legislation, this dividend is designated as an eligible dividend.

ADDITIONAL INFORMATION

For additional information, please refer to Torstar's audited consolidated financial statements for the year ended December 31, 2009 and the 2009 Management's Discussion and Analysis. Both documents were filed today with SEDAR and are available on Torstar's corporate website www.torstar.com.

CONFERENCE CALL

Torstar has scheduled a conference call for March 3, 2010 at 8:15 a.m. to discuss its fourth quarter results. The dial-in number is (416) 340-8018 or 1-866-223-7781. A live broadcast of the conference call will be available over the Internet on the Investor Relations (Conference Calls) page on Torstar's website www.torstar.com. A recording of the conference call will be available for 9 days by calling 416-695-5800 or 1-800-408-3053 and entering reservation number 4338024. An online archive of the broadcast will be available shortly after the completion of the call and will be accessible by visiting the Investor Relations (Conference Calls) page on Torstar's website www.torstar.com.

About Torstar Corporation

Torstar Corporation is a broadly based media company listed on the Toronto Stock Exchange (TS.B). Its businesses include the Star Media Group led by the Toronto Star, Canada's largest daily newspaper and digital properties including thestar.com, toronto.com, Workopolis, Olive Media, and eyeReturn; Metroland Media Group, publishers of community and daily newspapers in Ontario; and Harlequin Enterprises, a leading global publisher of books for women.

Non-GAAP Measures

Management uses both operating profit, as presented in the consolidated statements of income, and EBITDA as measures to assess the performance of the reporting units and business segments. EBITDA is a measure that is also used by many of Torstar's shareholders, creditors, other stakeholders and analysts as a proxy for the amount of cash generated by Torstar's operations or by a reporting unit or segment. EBITDA is not the actual cash provided by operating activities and is not a recognized measure of financial performance under GAAP. Torstar calculates EBITDA as the consolidated, segment or reporting unit operating profit as presented on the consolidated statements of income which is before charges for interest and taxes, adjusted for depreciation and amortization of intangible assets. Torstar also excludes restructuring and other charges from its calculation of EBITDA. Torstar's method of calculating EBITDA may differ from other companies and accordingly may not be comparable to measures used by other companies.

2008 Comparatives

2008 comparatives have been restated to reflect Transit TV as a discontinued operation and the retrospective adoption of CICA Handbook Section 3064. In the Newspapers and Digital Segment, 2008 results have also been restated for the transfer of TMGTV from Star Media Group to Metroland Media Group.

Forward-looking statements

Certain statements in this press release and in the Company's oral and written public communications may constitute forward-looking statements that reflect management's expectations regarding the Company's future growth, results of operations, performance and business prospects and opportunities as of the date of this report. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "anticipate", "believe", "plan", "forecast", "expect", "intend", "would", "could", "if", "may" and similar expressions. All such statements are made pursuant to the "safe harbour" provisions of applicable Canadian securities legislation. These statements reflect current expectations of management regarding future events and operating performance, and speak only as of the date of this report. The Company does not intend, and disclaims any obligation to, update any forward-looking statements, whether written or oral, or whether as a result of new information or otherwise, except as may be required by law.

By their very nature, forward-looking statements require management to make assumptions and are subject to inherent risks and uncertainties. There is a significant risk that predictions, forecasts, conclusions or projections will not prove to be accurate, that management's assumptions may not be accurate and that actual results, performance or achievements may differ significantly from such predictions, forecasts, conclusions or projections expressed or implied by such forward-looking statements. We caution readers to not place undue reliance on the forward-looking statements in this press release as a number of factors could cause actual future results, conditions, actions or events to differ materially from the targets, outlooks, expectations, goals, estimates or intentions expressed in the forward-looking statements. In addition, forward-looking statements are provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that reliance on such information may not be appropriate for other purposes.

These factors include, but are not limited to: general economic conditions in the principal markets in which the Company operates, the Company's ability to operate in highly competitive industries, the Company's ability to compete with other forms of media, the Company's ability to attract advertisers, cyclical and seasonal variations in the Company's revenues, labour disruptions, newsprint costs, foreign exchange fluctuations, investments, restrictions imposed by existing credit facilities and availability of capital, pension fund obligations, reliance on its printing operations, reliance on technology and information systems, interest rates, availability of insurance, litigation, environmental regulations, dependence on key personnel, control of Torstar by the voting trust, loss of reputation, intellectual property rights and uncertainties associated with critical accounting estimates.

We caution that the foregoing list is not exhaustive of all possible factors, as other factors could adversely affect our results. For more information, please see the discussion of risks affecting Torstar and its businesses in Torstar's 2009 Management's Discussion & Analysis which is available at www.sedar.com and on Torstar's corporate website www.torstar.com.

In addition, a number of assumptions, including those assumptions specifically identified throughout this press release, were applied in making the forward-looking statements set forth in this press release. Some of the key assumptions include, without limitation, assumptions regarding the performance of the North American economy; tax laws in the countries in which we operate; continued availability of printing operations; continued availability of financing on appropriate terms; exchange rates; market competition; and successful development of new products. There is a risk that some or all of these assumptions may prove to be incorrect.

Torstar's new releases are available on the Internet at www.torstar.com.



Torstar Corporation
Consolidated Balance Sheets
(Dollars in Thousands)
(Audited)
December 31 December 31
2009 2008
----------------------------------------------------------------------------

Assets
Current:
Cash and cash equivalents $39,238 $45,787
Receivables 253,306 273,658
Inventories 33,953 41,075
Prepaid expenses and other current assets 51,501 59,814
Prepaid and recoverable income taxes 2,997 13,719
Future income tax assets 19,540 25,716
----------------------------------------------------------------------------
Total current assets 400,535 459,769
----------------------------------------------------------------------------
Property, plant and equipment (net) 251,817 280,996
----------------------------------------------------------------------------
Investment in associated businesses 178,828 201,571
----------------------------------------------------------------------------
Intangible assets 51,619 52,146
----------------------------------------------------------------------------
Goodwill 581,842 577,116
----------------------------------------------------------------------------
Other assets 140,108 156,543
----------------------------------------------------------------------------
Future income tax assets 33,693 50,592
----------------------------------------------------------------------------
Total assets $1,638,442 $1,778,733
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Liabilities and Shareholders' Equity
Current:
Bank overdraft $2,052 $4,425
Accounts payable and accrued liabilities 218,971 238,600
Income taxes payable 19,158 10,057
----------------------------------------------------------------------------
Total current liabilities 240,181 253,082
----------------------------------------------------------------------------
Long-term debt 552,976 668,700
----------------------------------------------------------------------------
Other liabilities 103,408 119,827
----------------------------------------------------------------------------
Future income tax liabilities 62,897 72,090
----------------------------------------------------------------------------
Shareholders' equity:
Share capital 391,626 390,978
Contributed surplus 11,901 11,018
Retained earnings 292,306 288,934
Accumulated other comprehensive loss (16,853) (25,896)
----------------------------------------------------------------------------
Total shareholders' equity 678,980 665,034
----------------------------------------------------------------------------

-------------------------------------------------------------- ------------
Total liabilities and shareholders' equity $1,638,442 $1,778,733
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Torstar Corporation

Consolidated Statements of Income
(Dollars in Thousands)
(Unaudited) (Audited)
Three months ended Twelve months ended
December 31 December 31
2009 2008 2009 2008
----------------------------------------------------------------------------
Operating revenue
Newspapers and digital $272,560 $286,145 $957,956 $1,060,836
Book publishing 122,225 126,206 493,303 472,917
----------------------------------------------------------------------------
$394,785 $412,351 $1,451,259 $1,533,753
Operating profit
Newspapers and digital $39,202 $37,595 $70,154 $109,305
Book publishing 20,653 14,317 83,797 67,511
Corporate (4,089) (3,768) (14,969) (16,903)
Restructuring and other
charges (12,968) (13,123) (43,729) (41,723)
----------------------------------------------------------------------------
42,798 35,021 95,253 118,190
Interest (5,100) (6,572) (21,036) (28,225)
Foreign exchange (493) 433 (458) 395
Income (loss) of
associated businesses 30,350 (137,744) (17,953) (136,948)
Gain on sale of land 239 9,170
Investment write-down and
loss (2,400) (97,399) (2,400) (99,797)
----------------------------------------------------------------------------
Income (loss) before
taxes 65,155 (206,261) 53,645 (137,215)
Income and other taxes (7,800) (5,400) (18,000) (21,500)
----------------------------------------------------------------------------
Income (loss) from
continuing operations 57,355 (211,661) 35,645 (158,715)
Discontinued operations (2,256) (22,789)
----------------------------------------------------------------------------
Net income (loss) $57,355 ($213,917) $35,645 ($181,504)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Earnings (loss) per Class
A and Class B share:
Net income (loss) from
continuing operations -
Basic and Diluted $0.73 ($2.68) $0.45 ($2.01)
Net income (loss) - Basic
and Diluted $0.73 ($2.71) $0.45 ($2.30)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Torstar Corporation
Consolidated Statements of Cash Flows
(Dollars in Thousands)
(Unaudited) (Audited)
Three months ended Twelve months ended
December 31 December 31
2009 2008 2009 2008
----------------------------------------------------------------------------

Cash was provided by (used
in)
Operating activities $51,028 $37,036 $153,364 $122,217
Investing activities (9,455) (11,165) (29,151) (46,086)
Financing activities (36,793) (18,889) (126,078) (68,671)
----------------------------------------------------------------------------
Increase (decrease) in cash 4,780 6,982 (1,865) 7,460
Effect of exchange rate
changes (173) 2,245 (2,311) 3,422
Cash, beginning of period 32,579 32,135 41,362 30,480
----------------------------------------------------------------------------
Cash, end of period $37,186 $41,362 $37,186 $41,362
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Operating activities:
Income (loss) from
continuing operations $57,355 ($211,661) $35,645 ($158,715)
Depreciation and
amortization 13,839 13,196 52,819 53,273
Future income taxes (2,412) (1,151) (3,206) 1,552
Loss (income) of associated
businesses (30,350) 137,744 17,953 136,948
Dividend received from
associated business 1,161
Investment write-down and
loss 2,400 97,399 2,400 99,797
Other 2,800 (1,404) 14,248 (14,145)
----------------------------------------------------------------------------
43,632 34,123 119,859 119,871
Decrease in non-cash working
capital 7,396 3,992 33,505 5,936
Discontinued operations (1,079) (3,590)
----------------------------------------------------------------------------
Cash provided by operating
activities $51,028 $37,036 $153,364 $122,217
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Investing activities:
Additions to property, plant
and equipment and
intangible assets ($6,765) ($10,279) ($20,706) ($26,081)
Acquisitions and investments (2,288) (1,032) (9,464) (24,651)
Proceeds on sale of land 239 3,095
Other (402) 187 780 1,599
Discontinued operations (41) (48)
----------------------------------------------------------------------------
Cash used in investing
activities ($9,455) ($11,165) ($29,151) ($46,086)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Financing activities:
Issuance of bankers'
acceptance $14,370 $14,479
Repayment of bankers'
acceptance ($29,882) ($4,762) (86,230) (26,291)
Repayment of medium term
notes (25,000)
Dividends paid (7,272) (14,516) (29,076) (57,871)
Other 361 389 (142) 1,012
----------------------------------------------------------------------------
Cash used in financing
activities ($36,793) ($18,889) ($126,078) ($68,671)
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Cash represented by:
Cash $29,004 $22,256 $29,004 $22,256
Cash equivalents 10,234 23,531 10,234 23,531
----------------------------------------------------------------------------
Cash and cash equivalents 39,238 45,787 39,238 45,787
Bank overdraft (2,052) (4,425) (2,052) (4,425)
----------------------------------------------------------------------------
$37,186 $41,362 $37,186 $41,362
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Contact Information

  • Torstar Corporation
    L. DeMarchi
    Executive Vice-President and Chief Financial Officer
    (416) 869-4776
    www.torstar.com