Corus Entertainment Inc. (TSX: CJR.B) announced today that, as part of its plan to strategically invest in and further optimize its core national media brands for future growth, it intends to discontinue its Pay TV business in Western Canada, which includes Movie Central, Encore Avenue and HBO Canada.
“After an extensive strategic review of our business, we made the decision to strengthen our focus on one of our biggest growth opportunities, our powerful national media brands targeted to kids, women and families,” said Doug Murphy, President and Chief Executive Officer, Corus Entertainment. “Therefore, we have decided to exit our regional Pay TV business concurrent with Bell Media’s plans to expand their premium offering nationally. We have always believed that the best way to serve Pay TV subscribers is through a national operator and brand.”
To ensure continuity for subscribers, Corus will continue to operate Movie Central, Encore Avenue
and HBO Canada until Bell Media’s national Pay TV service is available in Western Canada.
Added Doug Murphy, “We value our long and successful partnership with Bell and wish them every success as they extend their Pay TV offering to serve all Canadians.”
Corus will receive cash consideration of $211 million Cdn from Bell Media to assist in their national expansion, valued at an adjusted F2015 EBITDA* multiple for Pay TV of 6.7x. The cash will be
used to invest in the advancement of Corus’ strategic priorities and retire debt.
*Segment profit (EBITDA) does not have a standardized meaning prescribed by IFRS. The Company reports on segment profit because it is a key measure used to evaluate performance. For definitions and explanations, see discussion under the Key Performance Indicators section of the 2015 Report to Shareholders. Corus Entertainment Inc. reports in Canadian dollars.
This press release contains forward‐looking information and should be read subject to the following cautionary language:
To the extent any statements made in this report contain information that is not historical, these statements are forward‐looking statements and may be forward‐looking information within the meaning of applicable securities laws (collectively, “forward‐looking statements”). These forward‐ looking statements related to, among other things, our objectives, goals, strategies, intentions, plans, estimates and outlook, including advertising, distribution, merchandise and subscription revenues, operating costs and tariffs, taxes and fees, and can generally be identified by the use of the words such as “believe”, “anticipate”, “expect”, “intend”, “plan”, “will”, “may” and other similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward‐looking statements. Although Corus believes that the expectations reflected in such forward‐looking statements are reasonable, such statements involve risks and uncertainties and undue reliance should not be placed on such statements. Certain material factors or assumptions are applied in making forward‐looking statements, including without limitation factors and assumptions regarding advertising, distribution, merchandise and subscription revenues, operating costs and tariffs, taxes and fees and actual results may differ materially from those expressed or implied in such statements. Important factors that could cause actual results to differ materially from these expectations include, among other things: our ability to attract and retain advertising revenues; audience acceptance of our television programs and cable networks; our ability to recoup production costs, the availability of tax credits and the existence of co‐production treaties; our ability to compete in any of the industries in which we do business; the opportunities (or lack thereof) that may be presented to and pursued by us; conditions in the entertainment, information and communications industries and technological developments therein; changes in laws or regulations or the interpretation or application of those laws and regulations; our ability to integrate and realize anticipated benefits from our acquisitions and to effectively manage our growth; our ability to successfully defend ourselves against litigation matters arising out of the ordinary course of business; and changes in accounting standards. Additional information about these factors and about the material assumptions underlying such forward‐looking statements may be found in our Annual Information Form. Corus cautions that the foregoing list of important factors that may affect future results is not exhaustive.
When relying on our forward‐looking statements to make decisions with respect to Corus, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Unless otherwise required by applicable securities laws, we disclaim any intention or obligation to publicly update or revise any forward looking statements whether as a result of new information, events or circumstances that arise after the date thereof or otherwise.
