Montréal, Québec ‑ Quebecor Inc. (“Quebecor” or “the Corporation”) today reported its consolidated financial results for the second quarter of 2024.

Second quarter 2024 highlights

• In the second quarter of 2024, Quebecor recorded revenues of $1.39 billion, down $11.6 million (‑0.8%), adjusted EBITDA of $624.9 million, up $19.7 million (3.3%) and adjusted cash flows from operations of $449.7 million, down $5.6 million (‑1.2%) compared with the same period of 2023.

• The Telecommunications segment reported a $14.3 million (‑1.2%) decrease in revenues, stable adjusted EBITDA, and a $15.7 million (‑3.4%) decrease in adjusted cash flow from operations, which reflects sustained investment in the Canada‑wide expansion plan.

• There was a net increase of 66,200 revenue‑generating units (“RGUs”) (0.9%) in the second quarter of 2024, including 93,500 connections (2.4%) to the mobile telephony service.

• TVA Group Inc. (“TVA Group”) recorded a $5.2 million (3.7%) increase in revenues and a $17.0 million favourable variance in adjusted EBITDA compared with the second quarter of 2023, due in part to an agreement on carriage fees for the LCN specialty channel, which gave rise to a $10.2 million favourable retroactive adjustment.

• The Sports and Entertainment segment’s revenues decreased by $3.4 million (‑7.0%) and its adjusted EBITDA by $2.0 million in the second quarter of 2024.

• Quebecor’s consolidated net income attributable to shareholders: $207.6 million ($0.90 per basic share), up $33.5 million ($0.15 per basic share) or 19.2%.

• Adjusted income from operating activities: $205.1 million ($0.89 per basic share), up $22.8 million ($0.10 per basic share) or 12.5%.

• In the second quarter of 2024, Fizz and Freedom announced the expansion of their service areas in several regions of Canada, including Manitoba, through agreements reached under the Canadian Radio-television and Telecommunications Commission (“CRTC”)'s Mobile Virtual Network Operator (“MVNO”) regime. This expansion continued on July 23, 2024, when Freedom announced the addition of some 50 cities and communities in Alberta and British Columbia to its service area.

• On May 7, 2024, Freedom Mobile Inc. (“Freedom”) announced the phased roll‑out of its affordable new wireline Internet and TV services, Freedom Home Internet and Freedom TV, becoming a true multi‑service player and positioning itself to address a new customer segment seeking bundled offers.

• On April 10, 2024, Videotron announced that it would help improve wireless coverage in outlying regions of Québec by installing at least 37 new cell towers in Abitibi‑Témiscamingue and the Laurentians in partnership with the Québec government.

• Both Videotron and Freedom performed very well in the mid‑year report released by the Commission for Complaints for Telecom‑television Services (CCTS) on April 25, 2024. Videotron’s and Freedom’s outstanding customer service and their determination to resolve issues promptly are reflected in this report. While the volume of complaints logged by CCTS about the telecom industry as a whole rose sharply by 43.1%, Videotron stood out from the other major players with a significant drop of 11.4%, while Freedom saw its percentage of complaints decrease from 6.5% to 4.7% compared to the industry total volume of complaints.

• On June 26, 2024, Event Management Gestev Inc. (“Gestev”) acquired Evenma, a company that manages popular and corporate events including the renowned Festivent and Festibières festivals. This acquisition is an important step in Gestev’s expansion, strengthening its leadership position in the events market.

• On May 6, 2024, S&P Global Ratings upgraded Videotron’s unsecured debt from BB+ to BBB‑ with stable outlook. On May 30, 2024, Moody’s Ratings upgraded Videotron’s unsecured debt from Ba2 to Baa3 with stable outlook. On June 13, 2024, following these new ratings, all liens on Videotron’s assets granted to bank lenders were terminated and the related debt instruments (including derivative financial instruments) are now unsecured.

• On June 21, 2024, Videotron issued $600.0 million aggregate principal amount of Senior Notes bearing interest at 4.650% and maturing on July 15, 2029, and $400.0 million aggregate principal amount of Senior Notes bearing interest at 5.000% and maturing on July 15, 2034, for total net proceeds of $992.6 million.

• On June 17, 2024, Videotron redeemed at maturity its Senior Notes in aggregate principal amount of US$600.0 million, bearing interest at 5.375%, and unwound the related hedging contracts for a total cash consideration of $662.3 million.

• On June 25, 2024, Quebecor redeemed all of its outstanding 4.0% convertible debentures in the aggregate principal amount of $150.0 million. Pursuant to the terms of the debentures, the Corporation elected to settle the redemption in shares and consequently issued and delivered 5,161,237 Class B Subordinate Voting Shares (“Class B Shares”) to the holders.
   

Comments by Pierre Karl Péladeau, President and Chief Executive Officer of Quebecor
 

Barely one year after Videotron acquired Freedom in April 2023, Quebecor proudly announced that it has fulfilled all of the nine undertakings it made to Innovation, Science and Economic Development Canada (ISED) and to Canadians. In the space of a year, we have succeeded in promoting genuine competition in Canada’s telecommunications industry and driving down wireless prices for the benefit of all Canadians. We have also delivered on our promise to extend Freedom and Fizz services to Manitoba and several other Canadian regions through MVNO agreements. Together, Videotron, Fizz and Freedom now reach more than 32 million Canadians, or approximately 80% of Canada’s population.

Driven by our determination to continue disrupting the Canadian wireless market and enhancing the customer experience, we recently announced that all Freedom monthly plans will now include access to the 5G network and roaming services in the U.S. and Mexico. Freedom continued playing in the multi‑service space by rolling out its new wireline Internet and television services, Freedom Home Internet and Freedom TV, to address a customer segment seeking affordable bundled services.

With the expansion of its service area and the diversification of its range of competitively priced products, our Telecommunications segment has grown its mobility customer base by 308,500 lines (8.5%) over the past 12 months.

To continue building out our 5G network across Canada, we need an MVNO regulatory regime that allows us to fully play our role as the fourth national carrier and to compete on a level playing field with the Big 3, which are currently engaging in what we believe to be anti‑competitive practices. Since we began our Canada‑wide expansion, we have amply demonstrated the benefits of healthy competition for consumers across the country. If Canadians are to enjoy access to innovative wireless services at better prices, regulators must act promptly to introduce appropriate policies and rates that reflect current market conditions.

In an environment that remains highly competitive, Quebecor posted a slight 0.8% decline in consolidated revenues, a 3.3% increase in adjusted EBITDA, reflecting continuing operational rigour, and a 12.5% increase in adjusted income from operating activities in the second quarter of 2024. With more than $2.1 billion in available liquidity, Quebecor enjoys optimal financial flexibility and remains very strongly positioned to execute on its cross‑Canada growth plan.

Videotron’s excellent reputation on financial markets was reinforced by investment‑grade ratings from S&P Global Ratings and Moody’s Ratings. Our successful inaugural issuance of investment‑grade Senior Notes in the aggregate amount of $1.0 billion was an important step in reducing our borrowing costs.

In the second quarter of 2024, TVA Group recorded a favorable variance of $17.0 million in its adjusted EBITDA, mainly due to a $10.2 million retroactive adjustment to LCN carriage fees and the return of major foreign productions to MELS’ studios.

The television business continued to suffer from declining advertising revenues and the major challenges facing the entire media industry. Excluding the one‑time retroactive adjustment to carriage fees, adjusted EBITDA from television activities was negative. We continue our sustained efforts to obtain fair market value for all our specialty channels. We are also counting on the upcoming CRTC arbitration decision on carriage fees for TVA Sports to ensure that we receive fair value from Bell TV, which we have been demanding for years.

Despite these challenges, savings from the reorganization initiatives announced last year are beginning to materialize. At the same time, TVA Group held its place at the top of the Québec ratings thanks to its strong programming lineup. It maintained its audience domination in the second quarter of 2024, increasing its market share to 42.5%. The TVA Sports channel posted an exceptional 1.0‑point increase in market share, due in part to its broadcasts of the National Hockey League (NHL) playoffs and Euro 2024.

Finally, we remain firmly committed to continuing our expansion and disciplined execution of our strategies in order to deliver an unrivalled customer experience, a wider range of products and ever more affordable options to growing numbers of Canadians. We will maintain our solid track record and superior operating performance while exercising rigorous financial discipline to create value for all our stakeholders.




 

For more details and to consult definitions of "adjusted EBITDA", "adjusted income from operations", "adjusted cash flows from operations" and "revenue-generating unit", please refer to the attached PDF file for the complete version of the press release.

Information :

Hugues Simard
Chief Financial Officer
Quebecor Inc. and Quebecor Media Inc.
hugues.simard@quebecor.com
514 380-7414
 

Communications department
Quebecor Inc. and Quebecor Media Inc.
medias@quebecor.com
514 380-4572