MONTREAL – TVA Group’s net income fell 19.8% to $14.1 million in the second quarter of 2005, ended June 30th, compared to the same quarter last year.
The publishing and broadcasting company blamed the decrease on “a more difficult advertising market, combined with higher programming costs for TVA Network, with the latter essentially the result of investments in new shows. The losses incurred by our new television stations (such as Toronto 1) and new magazines are also partially responsible for the reduced net income.
EBITDA for the second quarter was $24.7 million, compared with $29.7 million for the same quarter last year.
"TVA’s strategy of investing in its content and new channels, in addition to the challenging advertising market during the quarter, directly impacted our profitability," said Pierre Dion, president and CEO of TVA, in the press release. "Despite market fragmentation and strong competition in the television industry, the TVA Network remains the strong leader – even increasing its viewing hours. In fact, the TVA Network broadcast nine of the 10 most-watched programs in Quebec during the quarter. We are very pleased with our progress in recent months, particularly concerning Toronto 1’s positioning and future programming, but also with the improved performance of TVA Films."
Cash flow from operations were $5.2 million for the quarter, against $14.6 million generated during Q2 ’04. This change in cash flows provided by operations is mainly the result of the lower net income for the quarter and of changes in non-cash working capital items, which required an investment in cash flows of $9.1 million for the second quarter of 2004, compared with an investment of $12 million for this quarter, said the company.
