Mr. Pierre Peladeau reports

TVA GROUP REPORTS CONSOLIDATED RESULTS FOR Q1 2024

TVA Group Inc. has released its consolidated financial results for the first quarter of 2024.

Highlights

First quarter 2024:

• $129,161,000 in revenues, a $6,942,000 (negative 5.1 per cent) decrease compared with the first quarter of 2023;
• $17,903,000 (negative 41 cents per basic share) net loss attributable to shareholders, a $5.63-million (13 cents per basic share) favourable variance compared with the same quarter of 2023;
• $19,301,000 in consolidated negative adjusted EBITDA (earnings before interest, taxes, depreciation and amortization), a $4,676,000 favourable variance from the same quarter of 2023;
• $21,259,000 in negative adjusted EBITDA for the broadcasting segment, a $1,547,000 favourable variance mainly due to savings in content costs, a decrease in Canadian Radio-television and Telecommunications Commission Part 2 licence fees and savings stemming from the implementation of reorganization plans that slightly offset the decrease in revenues, particularly advertising revenues;
• $2,605,000 in adjusted EBITDA for the film production and audiovisual services segment (MELS), a $3.16-million favourable variance, mainly due to higher volume of sound stage, mobile and equipment rental activities and the positive impact of the discontinuation of visual effect activities, partially offset by a lower volume of postproduction activities;
• $319,000 in negative adjusted EBITDA for the magazines segment, a $48,000 favourable variance, mainly because cost savings were slightly higher than the decrease in revenues;
• $370,000 in negative adjusted EBITDA for the production and distribution segment, a $15,000 unfavourable variance, due mainly to lower adjusted EBITDA generated by TVA Films, as well as a decrease in gross margin for Incendo, partially offset by savings in administrative expenses.

Pierre Karl Peladeau, acting president and chief executive officer of TVA Group, commented: "While most segments showed improvement, our first quarter results were still significantly impacted by lower revenues.

"Results in the broadcasting segment continue to be adversely affected by the decline in our advertising revenues, which are the sole source of revenue for our over-the-air network, resulting in $21,259,000 in negative adjusted EBITDA for the first quarter of 2024.

"Two thousand twenty-four will be a transitional year in which we will continue to implement the major reorganization plan announced on Nov. 2, 2023, notably by refocusing on our mission as a broadcaster and optimizing our real estate holdings, in order to generate significant savings from these restructuring initiatives over the coming quarters. In this context, TVA Group is pleased to have reached agreements on the renewal of collective agreements for its employees in Montreal, as well in Quebec City and the regions.

"Despite the many challenges facing the industry, TVA Group continues to hold the highest market share in Quebec of nearly 41 per cent for the first quarter. This winter, TVA Network remained the most popular channel every day of the week, with seven of the top-10 shows in Quebec. This success is due to its many original productions, eight of which reached the one million viewer mark. The reality show Sortez-moi d'ici! ranked first with an average audience of more than 1.6 million viewers, La Voix stood out with over 1.5 million viewers and was the regular program most watched live, the daily program Indefendable had 1.4 million viewers, and the police drama Alertes attracted more than 1.1 million viewers. For its part, TVA Nouvelles remains the leader in all time slots, with 4.1 million viewers on a weekly basis.

"To better serve its customers, TVA Group has also revamped some of its specialty services, Yoopa and Moi&Cie, with the launch of QUB, the new TV channel for QUB radio, and Temoin, a channel dedicated to crime and scandal content.

"The television industry plays a key role in our culture and society, and let's not forget the importance of TV in keeping the public informed. That's why it's imperative that the governments of Quebec and Canada expand the tax credit to support print media so that it also applies to the television news sector. If we want to preserve the strong media coverage that is essential to our democracy, we must support the work of all journalists, regardless of the medium or distribution platform.

"In the film production and audiovisual services segment, our services were in high demand during the first quarter, particularly our sound stage and equipment rental activities. We are delighted to welcome two major foreign productions from Apple and Skydance to our studios.

"We also welcome the Quebec government's decision to increase the film production services tax credit for foreign film shoots, which will help Montreal and Quebec as a whole remain attractive locations in the marketplace compared with major U.S. and Canadian cities. In addition, the increase in the cap on labour expenditures eligible for the tax credit will offset part of the increase in content costs to the benefit of Quebec's television and film industry.

"In the magazines segment, results for all titles were affected by a decline in revenues, offset by cost savings. This segment has been operating in a declining market for several years. That's why we're all the more concerned about the significant reduction in government support from the Canada Periodical Fund. We will of course continue our efforts to convince Canadian Heritage to take action in this precarious situation.

"The production and distribution segment had a similar first quarter to last year. Although the segment continues to be affected by a slowdown in orders in the U.S. market, Incendo has begun production of a Christmas movie for the Roku platform.

"At a time when we are operating in an uncertain environment that is affecting the entire industry, we would like to highlight the dedication of all our employees, who are committed to contributing to TVA Group's success. We are actively pursuing the implementation of our reorganization plan, continuing to make the necessary efforts and decisions to meet the challenges of the new media reality and ensure the sustainability of our business.

"In closing, following Jean-Marc Leger's decision not to seek another term as a director, I would like to thank him, on behalf of the board of directors of TVA Group, for his dedication and important contribution as a director since 2007. Jean-Marc has been a key associate, and it is a privilege for TVA Group to be able to continue to benefit from his expertise as an on-air analyst, particularly during election campaigns."

About TVA Group Inc.

TVA Group, a subsidiary of Quebecor Media Inc., is a communications company engaged in the broadcasting, film production and audiovisual services, international production and distribution of television content, and magazine publishing industries. TVA Group is North America's largest broadcaster of French-language entertainment, information and public affairs programming and one of the largest private-sector producers of French-language content. It is also the largest publisher of French-language magazines and publishes some of the most popular English-language titles in Canada. The corporation's Class B shares are listed on the Toronto Stock Exchange under the ticker symbol TVA.B.

The condensed consolidated financial statements, with notes, and the interim management's discussion and analysis for the three-month period ended March 31, 2024, can be consulted on the corporation's website.

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