Mr. Andrew MacLeod reports

POSTMEDIA REPORTS SECOND QUARTER RESULTS

Postmedia Network Canada Corp. has released financial information for the three and six months ended Feb. 29, 2024.

"Despite anticipated positive impacts from revisions to the Journalism Tax Credit and implementation of the Online News Act, the media industry in Canada continues to face major challenges as demonstrated by recent announcements of the creditor protection filings of each of Black Press and Saltwire," said Andrew MacLeod, President and CEO. "We remain focused on transforming our business and delivering a sustainable news media model for the future and appreciate the continued support of the provincial and federal governments, which are critical to ensuring a robust local media infrastructure."

Second Quarter Operating Results

Revenue for the quarter was $97.3 million as compared to $111.8 million in the same period in the prior year, representing a decrease of $14.5 million (13.0%). The revenue decrease was primarily due to decreases in advertising revenue of $11.3 million (20.8%) and circulation revenue of $4.1 million (11.1%), partially offset by increases in parcel revenue of $2.4 million (20.5%).

Total operating expenses excluding depreciation, amortization and restructuring decreased $10.2 million, or 9.1%, for the quarter ended February 29, 2024, relative to the same period in the prior year. The decrease relates to decreases in compensation, newsprint, production and other operating expenses, partially offset by an increase in distribution expense.

Operating loss before depreciation, amortization and restructuring in the quarter was $4.8 million, an increase of $4.3 million relative to the same period in the prior year. The increase in operating loss before depreciation, amortization and restructuring is due to the decrease in total revenue, partially offset by the decrease in operating expenses excluding depreciation, amortization and restructuring.

Net loss in the quarter ended February 29, 2024 was $20.1 million, as compared to a net loss of $20.8 million in the same period in the prior year. The decrease in net loss was primarily the result of decreases in depreciation and restructuring expenses, as well as a decrease in foreign exchange losses, partially offset by an increase in operating loss before depreciation, amortization and restructuring, and a decrease in gain on disposal of property, plant and equipment, assets held-for-sale and other assets.

Year-to-Date Operating Results

Revenue for the six months ended February 29, 2024 was $202.0 million as compared to $236.0 million in the same period in the prior year, a decrease of $34.0 million or 14.4%. The revenue decrease was primarily due to decreases in advertising revenue of $25.8 million (21.5%) and circulation revenue of $11.2 million (14.6%), partially offset by increases in parcel revenue of $6.0 million (28.6%).

Total operating expenses excluding depreciation, amortization and restructuring decreased $30.8 million or 13.3% for the six months ended February 29, 2024, relative to the same period in the prior year. The decrease relates to decreases in compensation, newsprint, production and other operating expenses, partially offset by an increase in distribution expense.

Operating income before depreciation, amortization and restructuring of $1.1 million in the six months ended February 29, 2024 represents a decrease of $3.2 million relative to the same period in the prior year. The decrease is due to the decrease in total revenue, partially offset by the decrease in operating expenses excluding depreciation, amortization and restructuring.

Net loss in the six months ended February 29, 2024 was $30.7 million, as compared to a net loss of $36.7 million in the same period in the prior year. The decrease in net loss was primarily the result of decreases in depreciation and restructuring expenses, as well as a decrease in foreign exchange losses, partially offset by a decrease in operating income before depreciation, amortization and restructuring, loss on debt refinancing, a decrease in gain on disposal of property, plant and equipment, assets held-for-sale and other assets and an increase in interest expense.

Additional Information

Additional information, including financial statements and management's discussion and analysis can be found on the Company's website at www.postmedia.com or on SEDAR+ at www.sedarplus.ca.

Note: All dollar amounts are expressed in Canadian dollars unless otherwise specified.

About Postmedia Network Canada Corp.

Postmedia Network Canada Corp. (TSX:PNC.A, PNC.B) is the holding company that owns Postmedia Network Inc., a Canadian newsmedia company representing more than 130 brands across multiple print, online, and mobile platforms. Award-winning journalists and innovative product development teams bring engaging content to millions of people every week whenever and wherever they want it. This exceptional content, reach and scope offers advertisers and marketers compelling solutions to effectively reach target audiences Our expertise in home delivery and expanding distribution network powers Postmedia Parcel Services. For more information, visit www.postmedia.com, www.postmediasolutions.com and www.postmediaparcelservices.com.

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