Mr. Andrew MacLeod reports

POSTMEDIA REPORTS SECOND QUARTER RESULTS

Postmedia Network Canada Corp. today released financial information for the three and six months ended Feb. 28, 2026.

"While we continue to navigate ongoing pressures in advertising and the broader media environment, growth in parcel and content revenue helped offset some of these declines in the quarter," said Andrew MacLeod, president and chief executive officer of Postmedia. "At the same time, optimized cost management initiatives continue to improve our operating profile year over year."

"Looking ahead, we are encouraged by the opportunities created through the recent acquisition of accelerate360 Canada and by our continued investment in digital transformation, highlighted most recently by the launch of the new Montreal Gazette website. Together, these efforts strengthen our connection with audiences and customers, support our diversified revenue strategy, and position the company for growth and sustainable long-term performance."

Second quarter operating results

Revenue for the quarter was $110.0-million, as compared with $110.8-million in the same period in the prior year, representing a decrease of $800,000 (0.8 per cent). The revenue decrease was primarily due to decreases in advertising revenue of $4.8-million (9.6 per cent) and circulation revenue of $2.5-million (7.2 per cent), partially offset by increases in parcel revenue of $3.5-million (25.4 per cent) other revenue of $3.0-million (24.9 per cent).

Total operating expenses excluding depreciation, amortization, impairment and restructuring, and other decreased $1.8-million, or 1.8 per cent, for the quarter ended Feb. 28, 2026, relative to the same period in the prior year. The decrease relates to decreases in compensation, newsprint and production expense, partially offset by an increase in distribution expense.

Operating income before depreciation, amortization and restructuring, and other in the quarter ended Feb. 28, 2026, was $10.7-million, an increase of $900,000 relative to the same period in the prior year. The increase is due to a decrease in operating expenses, excluding depreciation, amortization, impairment and restructuring, and other, partially offset by a decrease in total revenue.

Net income in the quarter ended Feb. 28, 2026, was $3.5-million, as compared with a net loss of $16.0-million in the same period in the prior year. The increase in net income was primarily the result of an increase in operating income before depreciation, amortization, impairment, and restructuring and other, an increase in foreign currency exchange gains and a decrease in losses on derivative financial instruments, partially offset by an increase in interest expense and a decrease in gain on disposal of right of use assets and assets held for sale.

Year-to-date operating results

Revenue for the six months ended Feb. 28, 2026, was $221.8-million, as compared with $221.1-million in the same period in the prior year, representing a increase of $700,000 (0.3 per cent). The revenue increase was primarily due to increases in parcel revenue of $7.0-million (26.2 per cent) and other revenue of $3.3-million (19.7 per cent), partially offset by decreases in advertising revenue of $4.9-million (4.6 per cent) and circulation revenue of $4.7-million (6.7 per cent).

Total operating expenses excluding depreciation, amortization, impairment and restructuring, and other increased $200,000, or 0.1 per cent, for the six months ended Feb. 28, 2026, relative to the same period in the prior year. The increase relates to increases in distribution and production expenses, partially offset by a decrease in compensation, newsprint and other operating expenses.

Operating income before depreciation, amortization, impairment and restructuring, and other for the six months ended Feb. 28, 2026, was $15.8-million, an increase of $500,000 relative to the same period in the prior year. The increase in operating income before depreciation, amortization, impairment and restructuring, and other is due to an increase in total revenue, partially offset by an increase in operating expenses excluding depreciation, amortization, impairment and restructuring, and other.

Net loss in the six months ended Feb. 28, 2026, was $16.9-million, as compared with a net loss of $40.5-million in the same period in the prior year. The decrease in net loss was primarily the result of an increase in operating income before depreciation, amortization, impairment and restructuring, and other, an increase in foreign currency exchange gains and a decrease in restructuring and other expenses, partially offset by an increase in losses on disposal of right-of-use assets and assets held for sale, an increase in interest expense, and an increase in losses on derivative financial instruments.

Additional information

Additional information, including financial statements and management's discussion and analysis, can be found on the company's website or on SEDAR+.

About Postmedia Network Canada Corp.

Postmedia Network Canada is the holding company that owns Postmedia Network Inc., a Canadian newsmedia company representing more than 130 brands across multiple print and digital 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. The company's expertise in home delivery and expanding distribution network powers Postmedia Parcel Services.

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