Glacier Ventures International Corp.
TSX : GVC

Glacier Ventures International Corp.

August 14, 2007 19:26 ET

Glacier Reports Second Quarter Earnings

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 14, 2007) - Glacier Ventures International Corp. ("Glacier") (TSX:GVC) reported revenue, cash flow and earnings for the period ending June 30, 2007.

Highlights

- Glacier's operations continued to generate strong revenue and EBITA growth on a "same-store" basis compared to last year, which contributed to an increase in cash flow from operations per share.

- Completed acquisitions totalling $9.8 million year to date, including community newspapers in Manitoba, Saskatchewan and British Columbia, the Farmers Independent Weekly, the Canadian Interiors and Building trade magazines and two trade shows called "Best of Canada" and "Outside the Box".

Operating Results

For the six months ended June 30, 2007, Glacier earned $20.3 million of consolidated cash flow from operations on revenue of $110.0 million, as compared to $13.2 million on revenue of $89.4 million for the six months ended June 30, 2006. Glacier's EBITA was $25.1 million and net income was $14.8 million for the six month period ended June 30, 2007, as compared to EBITA of $18.8 million and net income of $10.8 million for the same period last year.

For the three months ending June 30, 2007, Glacier earned $11.0 million of consolidated cash flow from operations on revenue of $56.3 million, as compared to $7.1 million on revenue of $48.6 million for the three months ended June 30, 2006. Glacier's EBITA was $13.3 million and net income was $10.4 million for the three months ended June 30, 2007, as compared to EBITA of $9.8 million and net income of $7.5 million for the same period last year.



--------------------------------------------------------------------------
--------------------------------------------------------------------------
$000's except share 3 Months 3 Months 6 Months 6 Months
and per share amounts June 30, June 30, June 30, June 30,
2007 2006 2007 2006
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Revenue $ 56,286 $ 48,570 $ 109,752 $ 89,413
--------------------------------------------------------------------------
EBITA $ 13,291 $ 9,752 $ 25,124 $ 18,784
--------------------------------------------------------------------------
Net income $ 10,440 $ 7,457 $ 14,805 $ 10,811
--------------------------------------------------------------------------
Cash flow from
operations $ 10,966 $ 7,137 $ 20,297 $ 13,227
--------------------------------------------------------------------------
Cash flow from
operations/share $ 0.12 $ 0.10 $ 0.22 $ 0.20
--------------------------------------------------------------------------
EBITA/share $ 0.14 $ 0.14 $ 0.27 $ 0.28
--------------------------------------------------------------------------
Net income/share $ 0.11 $ 0.11 $ 0.16 $ 0.16
--------------------------------------------------------------------------
Debt outstanding net
of cash reserves $ 103,605 $ 118,577 $ 103,605 $ 118,577
--------------------------------------------------------------------------
Shareholders' equity $ 253,626 $ 167,104 $ 253,626 $ 167,104
--------------------------------------------------------------------------
Average shares
outstanding, net 93,197,032 69,735,019 93,016,668 67,611,921
--------------------------------------------------------------------------
--------------------------------------------------------------------------


For the three months ended June 30, 2007, cash flow from operations per share was $0.12 compared to $0.10 for the same period last year, EBITA per share was $0.14, which was flat compared to the same period last year and net income per share was $0.11 compared to $0.11 for the same period last year (see following for EBITA and net income variance clarifications). For the six months ended June 30, 2007, cash flow from operations per share was $0.22 compared to $0.20 for the same period last year, EBITA per share was $0.27 compared to $0.28 for the same period last year and net income per share was $0.16, the same as last year (see following for EBITA and net income variance clarifications).

Glacier's operations have grown significantly in size over the last several years. Considerable efforts are being made to integrate the businesses acquired and improve performance with a focus on increasing cash flow per share and the quality and strength of our operations.

In this regard, Glacier's cash flow per share has grown significantly since the Hollinger Canada and related acquisitions completed at the end of 2005 and during 2006. Cash flow from operations per share was $0.37 for the twelve months ending December 31, 2006, which represented a 23.3% increase from the $0.30 earned in the year prior. Based on the $0.22 per share of cash flow from operations earned during the first six months of 2007, Glacier is on track to further increase cash flow from operations per share for this 2007 fiscal year. The 2006 and 2007 operational and per share performance demonstrate the impact on shareholder value of the acquisitions completed, the capital issued and financial structures employed and the improvement in operations achieved thus far.

Glacier's 2007 per share performance was affected by capital raised in the latter part of 2006, some of which has not yet been invested. Specifically, the 2007 quarterly EBITA, cash flow from operations and net income per share amounts were reduced by a) the issuance of an additional $20 million of equity capital (6.7 million common shares) in the fall of 2006 that was intended primarily to finance further acquisitions, of which $9.8 million has been invested to date in 2007 (see following) and b) the issuance of 5.2 million common shares in November 2006 to acquire a 25% interest in Continental Newspapers Ltd., the operating results of which are not consolidated in Glacier's financial statements. As the remainder of the $20 million is invested, and cash flow is earned from the $9.8 million of acquisitions completed to date this year, it is expected that cash flow from operations per share will increase accordingly.

Glacier is also reaching a stage where it is generating sufficient free cash flow to bring debt to leverage levels that allow additional accretive acquisitions to be funded from internal cash flow.

The year over year increase in EBITA for the six months ending June 30, 2007 was less than the increase in cash flow from operations as a result of approximately $0.7 million of non-cash operating expenses, primarily related to pension and benefits amounts and a decrease in cash taxes in 2007, offset by an increase in cash interest paid in 2007. The year over year increase in net income was less than would have been proportionate to the increase in cash flow from operations as a result of a one-time $2.8 million non-cash future income tax recovery in the second quarter of 2006 that was caused by a change in the federal enacted tax rate. Partially offsetting this was a one-time $1.1 million dilution gain realized during the quarter from the sale of treasury shares of GVIC Communications Corp. by way of private placement (see following).

Operational Performance

Glacier's operations continue to perform ahead of target and last year on a "same-store" basis in both revenue and cash flow. Both the recently acquired Hollinger Canada operations and Glacier's existing operations are performing ahead of expectations.

The growth in revenue during the second quarter compared to last year was a result of a) improved sales effectiveness, strong Western Canadian local economies, strong industry niches such as mining and energy, new product offerings and national and regional advertising efforts that allow advertisers to benefit from Glacier's larger group of publications and expertise and b) the acquisition of a 50% interest in the Alta Newspaper Group Limited Partnership in September 2006 as well as several smaller acquisitions completed in 2007 (see following).

Continued progress in cost efficiency improvement as well as the increase in revenues resulted in significant growth in "same store" cash flow for Glacier's operations.

Management believes there are meaningful opportunities to continue to realize greater value from Glacier's expanded operations through increased cost efficiencies, improved sales effectiveness and improved publication quality, amongst other things. A number of such opportunities were identified at the time of the Hollinger Canada acquisitions, as well for Glacier's other operations, that were expected to take several years to achieve.

While progress continues to be made in realizing these improvements, many of the opportunities are still to be realized.

Improved Financial Position

Glacier's leverage levels were further reduced during the quarter through the repayment of $4.3 million of long-term debt and increased profitability. Glacier's consolidated debt net of cash on hand was $103.6 million as at June 30, 2007 (excluding deferred financing charges). An additional $16 million of principal was repaid subsequent to quarter end. This was done to reduce interest expense until the capital is required for acquisitions, which is expected in the near term.

New Acquisitions & Recent Developments

Glacier acquired a community newspaper in British Columbia during the quarter and a number of community newspapers in Saskatchewan and Manitoba subsequent to the quarter end.

As previously stated, during the first quarter of 2007, Glacier completed acquisitions totalling $6.9 million in aggregate purchase price. The assets acquired included 1) community newspapers in Manitoba, Saskatchewan and British Columbia, 2) the Farmers Independent Weekly and 3) the Canadian Interiors and Building trade magazines and two trade shows called "Best of Canada" and "Outside the Box" and several other publications.

The consideration for the above acquisitions totalled $9.8 million. These acquisitions fit with Glacier's strategy of growing through two core segments: 1) the business and professional information sector and 2) the newspaper and trade publication sector.

On April 30, 2007 Glacier completed the transfer of substantially all of its operating businesses to its affiliate GVIC Communications Corp. ("GVIC") for $325 million in consideration, comprised of a $15 million promissory note and $310 million of GVIC Class C common shares.

At quarter end Glacier subscribed for $2.8 million of an $11.8 million GVIC private placement of new equity capital of voting and non-voting common shares. Glacier now owns 97% of the total equity of GVIC. GVIC was publicly listed on the Toronto Stock Exchange subsequent to quarter end.

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

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

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

Forward Looking Statements

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

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

Contact Information

  • Glacier Ventures International Corp.
    Mr. Orest Smysnuik
    (604) 872-8565