Printer and media company Transcontinental Inc. had a first quarter loss of $6.4 million, reversing $34.1 million in profits last year, as it lost business due to a drop in advertising.
The Montreal-based company said yesterday the loss for the period ended Jan. 31 was eight cents a share, compared to earnings of 41 cents in 2008.
The decrease of $40.5 million stems mainly from negative organic growth, along with impairment of assets and restructuring costs.
Excluding unusual items, net income decreased to $15.1 million from $28.4 million.
Revenues increased slightly to $604.1 million from $596 million in the year-ago period.
Transcontinental said its U.S. direct mail activities, magazine publishing and commercial printing were particularly affected by the cancellation, decrease or postponement of promotional and advertising campaigns, mainly by financial institutions and car manufacturers.
It responded last month by announcing plans to eliminate 1,500 jobs and managers will work two weeks without pay. The cost-cutting initiatives are expected to save about $75 million annually, including $50 million in 2009.
Despite the cuts, Transcontinental’s board decided to maintain its quarterly dividend at eight cents per share.
Transcontinental Inc. also announced Christian Trudeau, former president and chief operating officer of Centria Commerce, has been hired as president of its marketing communications sector.
The division, with more than 3,000 employees and annual revenues of $400 M, offers services including database analytics, e-mail marketing, one-to-one marketing, and custom communications. It includes recent Transcontinental acquisitions Thindata, Rastar and Redwood Custom Communications.
“I am happy that Christian will be leading our Marketing Communications Sector, which was created to partner with our clients to deliver an unparalleled suite of strategic marketing capabilities,” said Franç;ois Olivier, president and chief executive officer, Transcontinental Inc.
Before joining Centria, Trudeau was president and COO of BCE Emergis Inc. —Canadian Press with files from Marketing staff
