World Color Press Reports Revenue and Earnings Decline in Second Quarter
Year to Date For the first half of 2009, World Color reported a net loss from continuing operations of $185.4 million, compared to a net loss from continuing operations of $226.3 million for the same period in 2008. The results for the first half of 2009 incorporate IAROC, net of income taxes, of $12.9 million compared to $42.7 million in 2008, as well as reorganization items of $49.1 million which, net of income taxes, compared to $38.3 million in the first half of 2008. Consolidated operating revenues for the first half of 2009 were $1.46 billion compared to $1.99 billion in the same period of 2008. The lower operating revenues are due to decreased volume and price pressures.
Fresh Start Reporting The Company will be required, under Canadian GAAP, to adopt “fresh start” financial reporting. Under fresh start financial reporting, the Company will undertake a comprehensive re-evaluation of its assets and liabilities as of July 31, 2009, the effective fresh start date, based on the enterprise value of $1.5 billion as established and confirmed in the Plan. The Company has prepared a Pro Forma Fresh Start Consolidated Balance Sheet as of June 30, 2009, which is included in the MD&A. The “fresh start” process will result in our becoming a new entity for financial reporting purposes and will mean that the financial statements of the new entity will not be comparable to any of our previously issued financial statements.
Use of Non-GAAP Measures In the discussion of our 2009 results, we use certain financial measures that are not calculated in accordance with Canadian generally accepted accounting principles (GAAP) or United States GAAP to assess our financial performance, including EBITDA (earnings before interest, tax, depreciation and amortization), Adjusted EBITDA, Adjusted EBIT, and free cash flow.. We use such non-GAAP financial measures because we believe that they are meaningful measures of our performance. Our method of calculating these non-GAAP financial measures may differ from the methods used by other companies and, as a result, the non-GAAP financial measures presented in this press release may not be comparable to other similarly titled measures disclosed by other companies. We provide a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures in Figure 4, “Reconciliation of non-GAAP Measures” of our second quarter 2009 management’s discussion and analysis filed with the Canadian securities regulatory authorities at www.sedar.com and with the United States Securities and Exchange Commission at www.sec.gov. A copy of our second quarter 2009 management’s discussion and analysis is also available on the Company’s website at www.quebecorworld.com.