Glacier Ventures International Corp.

Glacier Ventures International Corp.

March 31, 2006 21:22 ET

Glacier Reports 2005 Year-End Results

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - March 31, 2006) - Glacier Ventures International Corp. ("Glacier" or the "Company") (TSX:GVC) reported cash flow, earnings and revenue for the period ending December 31, 2005.


Glacier significantly expanded the size and scope of its operations in 2005 and early 2006 through a number of strategic acquisitions that expanded both our business & professional information group and our newspaper and trade publication group. Acquisition, operating and financial highlights included:

- Acquired 85% of CD-Pharma Interactive Medical Productions Limited Partnership ("CD-Pharma") in January 2005. CD-Pharma develops interactive continuing medical education (CME) programs for medical practitioners that are sponsored by large pharmaceutical companies;

- Acquired 100% of Pennand Inc. in February 2005, which publishes and prints the Battlefords News Optimist, Optimist/Ad Post, Northwest Neighbours, The Maidstone Mirror, Humboldt Journal and Regional Trader in Saskatchewan;

- Acquired 100% of the Madison Publishing Group in July 2005, which publishes a group of community newspapers in British Columbia as well as the Business In Vancouver Media Group;

- Acquired 50% of Fundata Inc. at year end from Hollinger International Inc. ("Hollinger"), which provides investment fund related electronic and print information and analytics to the Canadian and global investment community and a wide variety of Canadian newspapers and media;

- Acquired 50% of Great West Newspapers Limited Partnership subsequent to year end from Jamison Newspapers Ltd. ("Jamison") following Jamison's acquisition of the remaining interest from Hollinger, which publishes and prints a number of community and specialty newspapers in Alberta;

- Acquired 100% of Hollinger Canadian Newspapers, Limited Partnership ("HCNLP") subsequent to year end from Hollinger and the minority unitholders. HCNLP prints and publishes a number of community, daily and specialty newspapers and publications in British Columbia and Quebec. Glacier also acquired the Merrit News and related publication from Hollinger contemporaneously;

- Acquired 100% of Eco Log Environmental Risk Information Services Ltd. ("Eco Log") subsequent to year end from Hollinger. Eco Log is an electronic information and report service provider that accesses key federal, provincial and private sector databases to help identify potential environmental risks in Canada for real estate developers, banks, insurance companies and a variety of other customers;

- Through three private placements, Glacier raised $100.0 million of new equity capital by issuing 8,333,333 common shares in July 2005 at $2.40 per share, 17,684,210 common shares at $2.85 per share at year end and 10,385,965 common shares at $2.85 per share in January 2006. The proceeds of the private placements were used to finance the acquisition of Canadian newspaper and publishing assets directly or indirectly from Hollinger. The remainder of the acquisition costs relating to the Hollinger Canada acquisitions were financed through a new $135 million banking facility financed by three major Canadian chartered banks;

- Consolidated cash flow from operations (before changes in non-cash operating accounts) per share grew 16.9% to $0.297 per share from $0.254 per share last year. This per share growth was reduced by the fact that equity was raised during the year for acquisitions from which only partial year or no cash flow was received in 2005;

- Consolidated earnings before interest, taxes and amortization (EBITA) grew 56.2% to $11.4 million for the year ending December 31, 2004 from $7.3 million last year;

- Consolidated cash flow from operations (before changes in non-cash operating accounts) grew 55.1% to $10.0 million from $6.5 million last year; and

- As a result of the acquisitions completed, Glaciers' pro forma cash flow from operations (before changes in non-cash operating accounts) per share has increased significantly, based on trailing 12-month performance for the new businesses acquired.

Results from Operations
12 Months Ending 12 Months Ending
December 31, December 31,
2005 2004
($000s, except share amounts)
Revenue $ 62,568 $ 41,240
EBITA $ 11,404 $ 7,303
Net income $ 5,330 $ 2,210
Cash flow from operations $ 10,006 $ 6,453
EBITA/share $ 0.339 $ 0.288
Cash flow from operations/share $ 0.297 $ 0.254
Net income/share $ 0.158 $ 0.087
Debt outstanding net of cash
reserves $ 8,139 $ 16,026
Shareholders' equity $ 127,418 $ 37,660
Average shares outstanding, net 33,635,334 25,394,015

The significant expansion undertaken in 2005 was driven by the pursuit of Glacier's business strategy. Glacier is focused on growing through the provision of essential information and related services in two core business segments: 1) business and professional information markets and 2) the newspaper and trade publication markets. Our strategy is to build businesses that provide information that is essential to people's needs - whether they are farmers or ranchers in the Prairies, residents of Canadian communities or doctors, professionals and businesspeople across Canada and the United States.

Financial Measures: To supplement the consolidated financial statements presented in accordance with Canadian generally accepted accounting principles (GAAP), Glacier uses certain non-GAAP measures that may be different from the performance measures used by other companies. These non-GAAP measures include cash flow from operations (before changes in non-cash operating accounts) and earnings before interest, taxes and amortization (EBITA), which are not alternatives to GAAP financial measures. Management focuses on operating cash flow per share as the primary measure of operating profitability, free cash flow and value. Earnings before interest, taxes and amortization (EBITA) per share is also an important measure as the Company has low ongoing capital expenditures and amortization largely relates to acquisition goodwill (prior to 2002) and copyrights and does not represent a corresponding sustaining capital expense. Management believes that non-GAAP financial measures assist in identifying underlying operating trends.

These non-GAAP financial measures, particularly EBITA, are also common measures used by investors, financial analysts and rating agencies. These groups may use EBITA and other non-GAAP financial measures to value a company.

Operating Performance

Glacier's revenue and cash flow grew significantly during 2005 as a result of the acquisitions completed as well as internal growth.

Improved sales and cost efficiency initiatives resulted in increased revenue and cash flow growth in the Saskatchewan and Manitoba newspaper operations. A number of printing consolidation and general operating cost efficiencies initiatives were implemented that have improved profitability. New sales initiatives resulted in increased run of press and classified revenues.

Revenues and cash flows at both the Western Producer and Farm Business Communications were stronger in 2005 due to specific advertising promotions run by major advertisers as well as strong special supplement advertising and cost control. The re-opening of the US border to Canadian beef has had a positive impact on the agricultural economy.

The Madison Publishing Group (which publishes community newspapers and related publications in British Columbia and the Business In Vancouver Media Group) has performed well since its acquisition in July 2005. Its revenues and cash flow are significantly ahead of last year. All of the key initiatives communicated at the time of acquisition as the basis for normalized EBITA in 2005 have been achieved.

Specialty Technical Publishers experienced growth in the Canadian market, as increased focus was placed on Canadian publications. Trial orders shipped in 2005 were slightly higher then 2004. Both the overall acceptance rate and renewal rates increased on a year over year basis. The continued strength in the Canadian dollar has had a negative impact on Specialty Technical Publishers' revenue, although a number of initiatives have been taken to counteract this impact, including price increases, emphasis on the Canadian market, significant focus on "network" sales to large corporations in electronic formats and greater efforts in online publishing and marketing alliances, amongst others.

CD-Pharma was successful in its focus on new sales efforts, increasing both its revenues and cash flows during the year. Renewal rates remained high from existing products and clients, and efforts are underway to launch a significant new lecture series initiative.

Hollinger Canada Acquisition

As described, Glacier acquired substantially all of Hollinger's Canadian operations through a series of transactions at year end and in February and March of 2006. Through this acquisition, Glacier has taken a significant step forward on the Canadian media landscape. The pro rata forecast fiscal 2005 revenue and EBITA for the interests acquired by Glacier in the Hollinger Canada operations is approximately $105 million and $18 million respectively on a normalized basis.

The businesses acquired provide Glacier with a greater balance of operations in our two core business segments. Glacier now has a strong strategic presence of newspaper operations across Western Canada, a well diversified portfolio of trade publications across Canada, and a significantly enhanced business and professional information group.

Management believes that there are meaningful opportunities to realize value from Glacier's expanded operations through increased cost efficiencies, improved sales effectiveness and improved publication quality, amongst other things.

Glacier was able to complete the Hollinger acquisition on an exclusive basis. A number of competitors and other buyers had expressed significant interest in acquiring the Hollinger Canada assets. Management believes the acquisition has increased the value of Glacier's equity based on the acquisition price paid and the expected market value of our combined operations.

Financial Position

As at December 31, 2005, Glacier had cash of $12.8 million, current and long-term debt of $21.0 million and working capital of $13.9 million excluding deferred revenue. Glacier's cash on hand included a significant amount raised from the Company's private placement in December 2005. These funds were used subsequent to year end for the Hollinger Canada acquisitions as described.

Glacier's consolidated debt increased subsequent to year end with the completion of the Hollinger Canada acquisitions. Glacier restructured the existing $50 million banking facility set up in January 2005 with a new $135 million banking facility financed by three major Canadian banks in 2006. Management will seek to reduce leverage levels through principal repayment and increased profitability in 2006.

The new facility provides Glacier with additional borrowing capacity for corporate purposes and further acquisitions.

2006 and Beyond

Glacier's size and scope increased considerably over the past year and has reached a new plateau that provides our company with the size of business, market penetration and depth of management and staff to achieve greater levels of operating and financial success. Significant focus will be placed on the integration of our new operations with growth in cash flow being the main priority.

Glacier will continue to review acquisitions and other strategic opportunities with which to expand our company and continue our strategy of pursuing both internal and acquisition growth in the information communications sectors. Glacier is focused on growing through two core business segments: 1) the business and professional market and 2) the newspaper and trade publication market.

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

About the Company: Glacier Ventures International Corp. is an information communications company focused on expanding across North America through both internal growth and the strategic acquisition of information communications companies that provide essential information and related services through print, electronic and online media. Glacier is currently pursuing this strategy through two core business segments: 1) the business and professional information markets and 2) the newspaper and trade publication markets.

Forward-Looking Statements

Certain statements in this press release are not historical and may constitute forward-looking statements reflecting financial performance. Investors are cautioned that all forward-looking statements involve risks and uncertainties. Forward-looking statements are based on management's estimates, beliefs and opinions on the date the statements are made. Glacier assumes no obligation to update forward-looking statements if circumstances should change. Additional information on these and other potential factors that could affect Glacier's financial results are detailed in documents filed from time to time with the applicable Canadian securities regulatory authorities.

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