Canadian printing and publishing company Transcontinental says improving markets and operating cuts have paved the way for improved profitability for months to come.
“Market conditions which have been very challenging as of late seem to have now stabilized,” president and CEO Francois Olivier said in a Tuesday conference call after the company reported a solid second-quarter profit.
“While our overall print volumes aren’t back to historical levels the pace of decline has definitely slowed for the majority of our businesses and some are actually up.”
Olivier said there was a slight rebound in advertising spending planned for May, June and July that should contribute positively to the company’s results in the current fiscal third quarter.
Three of its printing groups have experienced growth, including newspapers.
“We took a lot of costs out so we don’t need a whole lot of incremental volume to make a big difference at the bottom line,” he added.
The magazine division has stabilized after national advertising dropped by 10% to 15% last year.
Among its many businesses, Transcontinental owns newspapers in Atlantic Canada, Quebec, Saskatchewan and elsewhere and publishes consumer magazines such as Canadian Living, Elle Canada and The Hockey News.
The Montreal company also has major printing, marketing and outdoor advertising operations and employs more than 15,000 people in Canada, the United States and Mexico.
Olivier said Apple’s new iPad could have a mild impact on its operations–less so in magazines than in books that account for just $60 million of its $1.5 billion annual printing revenues.
“It’s a great product, it remains to be seen the impact on the various markets we are involved in printing and there are certainly certain markets we don’t feel it will be an impact at all.”
The Montreal-based media company reversed last year’s loss to earn $68.7 million in its second quarter despite lower revenues.
Total revenue during the quarter ended April 30 was $510 million revenue, down from $531.1 million a year earlier when the company recorded a $144.3-million net loss, Transcontinental announced Tuesday.
