Don't Change the Channel: TV the Brightest Spot in the Canadian Media Sector

M E D I A S E C T O R

Don't Change the Channel: TV the Brightest Spot in the Canadian Media Sector

CORUS ENTERTAINMENT INC. CJR.B TSX : C$14.81RECOMMENDATION: HOLD TARGET PRICE: $15.25

CYBERPLEX INC. CX TSX : C$1.57 RECOMMENDATION: BUY TARGET PRICE: $4.25

QUEBECOR INC. QBR.B TSX : C$18.10 RECOMMENDATION: BUY TARGET PRICE: $26.00

David Shore416.860.6784

[email protected]

Arun Thomas, Associate416.860.7666

[email protected]

1 0 J U N E 2 0 0 9

TECHNOLOGY SOFT WARE

This report has been created by Analysts that are employed by Research Capital Corporation, a Canadian Investment Dealer. For further disclosures, please see the last pages of this report

R E S E A R C H C A P I T A L

Research Capital is an employee-owned, full service, integrated investment dealer. Approximately

300 people work at Research Capital, and operate out of offices in Toronto, Montreal, Calgary, and

Vancouver.

F U L L S E R V I C E

Research Capital provides its clients with top quality research, sales, and trading coverage, a highly efficient

distribution system for equity financing through its institutional and private client operations, and strong

investment banking capabilities.

I N N O V A T I O N A N D E X E C U T I O N

We can trace our roots back to 1921, and have eighty years of experience in all types of market environments.

Our focus is the development of long-term, mutually rewarding relationships with clients. Our greatest

strengths are innovative investment ideas that make money for our clients coupled with powerful execution

capability.

G R O W T H C O M P A N I E S

Research Capital is one of the leading specialists in growth investing, ranging from technology and aerospace

to natural resource companies. We provide distribution breadth and superior knowledge of the growth

company market to institutional investors, private clients, and corporations.

Research Capital is also a growth company, and understands entrepreneurs and their importance in

economic innovation and wealth creation. We are proud to have sponsored and managed financings for

many of North America's leading edge, growth companies. Our capital raising activities range across all

stages of a company's evolution, from private placements to IPOs to follow-on financings.

Research Capital stands for innovation and execution.

The information contained in this report has been drawn from sources believed to be reliable but its accuracy or completeness is not guaranteed, nor in providing it does Research

Capital Corporation assume any responsibility or liability. Research Capital Corporation, its directors, officers and other employees may, from time to time, have positions in the

securities mentioned herein. Contents of this report cannot be reproduced in whole or in part without the express permission of Research Capital Corporation. (U.S. Institutional

Clients - Research Capital USA Inc., a wholly owned subsidiary of Research Capital Corporation, accepts responsibility for the contents of this report subject to the terms & limitations

set out above. U.S. Firms or institutions receiving this report should effect transactions in securities discussed in the report through Research Capital USA Inc., a Broker-Dealer

Registered with the United States Securities and Exchange Commission).


All prices as of June 4, 2009.

Note: Bold/Italics in tables denote max and min values.

In this report, we examine the potential impact on the traditional media sector in Canada of how users have changed their

consumption habits through the use of social media, while at the same time advertising expenditures are moving rapidly away

from traditional media to the Internet and mobile. We review the major market players, rank the market participants based on their

financial performance, and discuss how some companies are positioned to embrace the new social media order.

T H E C A N A D I A N M A R K E T

The Canadian market is highly concentrated, with each market segment (TV, Radio, and Newspaper) dominated by a few large

vendors. Canada is the most connected nation among the G7, with a high and increasing broadband penetration rate. Note

though that Canada lags behind in mobile usage. After significant industry consolidation, industry debt levels have reached record

highs, while stock price performance is largely negative.

M E D I A R E V E N U E M O D E L U N D E R P R E S S U R E

The traditional media revenue model is under tremendous pressure, caused by two fundamental changes. First, there has been

a structural shift in consumer behaviour as consumers change how they access content, while becoming content creators

themselves. Second, offline advertising revenues have been decimated, as advertising expenditure moves from newspapers and

radio to the Internet, and eventually mobile. Additionally, overall advertising revenues have been under pressure due to the

current economic environment, with the traditional largest advertisers (auto, financials, etc.) being hardest hit by the downturn

in the economy.

EXECUTIVE SUMMARY

T E C H N O L O G Y S O F T W A R E

MEDIA SECTOR

1

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


2

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

T E L E V I S I O N

The television segment remains the most robust among traditional media sectors, with growing consumption levels, especially as

TV interactivity grows. Note though that revenue within the TV sector is shifting, with subscription – primarily for specialty TV –

growing faster than advertising.

R A D I O

The radio segment faces challenges, with consumption levels dropping. This is exacerbated by the lack of interaction possible

for consumers. In addition, the radio segment is almost entirely dependant on advertising revenue (except for the new satellite

services).

N E W S P A P E R S

The newspaper segment faces the most difficult challenges, with consumption dropping at an accelerating pace. Moreover, with

high dependence on advertising and classified revenues, newspaper companies have seen significant revenue declines, and with

high fixed costs, profitability falling even faster.

I N I T I A T I N G C O V E R A G E

We are initiating coverage on three companies in the media sector. Cyberplex (TSX:CX; BUY, $4.25 FTM target price) is a leading

provider of online marketing solutions that is leveraged to the fastest growing segment of Internet advertising. Corus (TSX:CJR.B;

HOLD, $15.25 FTM target price) is an integrated media company with strength in the television and radio segments. Quebecor

(TSX:QBR.B; BUY, $26.00 FTM target price) is a media company with interests in cable, broadcasting, and publishing.


MEDIA UNDERGOING MASSIVE SHIFT IN SUPPLY & DEMAND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5

AN OVERVIEW OF THE CANADIAN MEDIA MARKET. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5

THE MEDIA REVENUE MODEL IS UNDER PRESSURE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

CONSUMERS CHANGING THEIR BEHAVIOUR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

ADVERTISING EXPENDITURES ARE CHANGING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

TELEVISION STILL KING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

TV CONSUMPTION STILL GROWING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

BUT THE REVENUE GENERATED FROM TV HAS CHANGED . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

WHY IS SPECIALTY GROWING FASTER? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

RADIO CHALLENGING TIMES AHEAD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

RADIO CONSUMPTION IN DECLINE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

NEWSPAPER OVER THE EDGE OF THE CLIFF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

NEWSPAPER REVENUE IN PRECIPITOUS DECLINE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

A CASE STUDY: THE NY TIMES – IF IT CAN’T MAKE IT… . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

WHY ARE NEWSPAPERS IN SUCH BAD SHAPE? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

MEDIA SECTOR FINANCIAL RANKING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

REVENUE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

REVENUE GROWTH. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

EBITDA MARGIN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

NET CASH . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

OPERATING CASH FLOW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

OVERALL SCORE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

HISTORICAL RANKINGS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

INITIATING COVERAGE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

CORUS ENTERTAINMENT INC. TSX:CJR.B. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

AN INTEGRATED MEDIA LEADER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

FINANCIAL REVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

ESTIMATE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

CATALYSTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

RISKS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

VALUATION & RECOMMENDATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

T A B L E O F

CONTENTS

3

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


CYBERPLEX INC. TSX:CX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

FROM CPM TO CPA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

COMPETITIVE ADVANTAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

TWO-PRONGED GROWTH STRATEGY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

IMPRESSIVE FINANCIAL STRENGTH . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47


CATALYSTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

RISKS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50


CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53

QUEBECOR INC. TSX:QBR.B . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

A DIVERSIFIED MEDIA & TELECOM LEADER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

FINANCIAL REVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58


CATALYSTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62

RISKS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63


CONCLUSION – STRENGTH IN CABLE OUTWEIGHS NEWSPAPER DRAG. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69

NONCOVERAGE PROFILES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71

BROADCASTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72

PUBLISHING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78

TELECOMMUNICATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89

MOVIES & ENTERTAINMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99

ADVERTISING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112

APPENDIXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118

COMP TABLES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118

PRICE CHARTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126

LIST OF FIGURES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128

4

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


M E D I A U N D E R G O I N G M A S S I V E S H I F T I N S U P P L Y & D E M A N D

The premise for our report is simple: the media sector (which includes companies involved in broadcasting, telecommunications,

advertising and publishing) is undergoing a cataclysmic shift due to the growth and penetration of the Internet and mobile usage.

This shift is driven by changes in consumer media consumption, the current economic challenges, and a structural change in the

creation and distribution of media.

Media companies have traditionally made money in two ways – from selling advertising and through subscriptions from

consumers. Unfortunately for the media companies, both sources of revenue are potentially at risk due to significant changes in (1)

consumption (or demand) and (2) the economic environment (supply).

Due to the rapid ongoing changes in consumption patterns, media companies have to be more nimble than ever before in order

to adapt to the changing market conditions. The Canadian market is characterized by high market player concentration within the

various media segments (TV, Radio, Publishing), while at the same time the consumer has a wider-than-ever range of methods to

access media – often without having to pay for it.

In our report, we review the three primary traditional media segments (TV, Radio, and Newspaper) and speculate as to the potential

impact the introduction of high-speed Internet and 3G wireless could have on the media sector.

A N O V E R V I E W O F T H E C A N A D I A N M E D I A M A R K E T

The Canadian media market has undergone significant structural change over the past few years, with the blurring of the lines

between traditional telecommunication and media companies. Canada is also a highly connected nation, with high levels of

broadband penetration and increased Internet usage. However, the market is now also highly concentrated, with each of the three

primary media segments (TV, Radio, and Newspaper) dominated by a few large players. The concentration has increased as a result

of industry consolidation which has led to dramatically higher debt levels in the sector. With the recent economic downturn

impacting advertisers and significant changes in consumer behaviour, almost all of the companies in our media universe have seen

their stock prices decimated and have started laying off employees in order to cut costs.

MAIN REPORT

5

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


6

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

A H I G H L Y C O N C E N T R A T E D M A R K E T

The Canadian media market is dominated by a few large players within each of the primary sub-segments (TV, Radio, and

Publishing). Figure 1 shows the estimated 2007 market share (based on estimated revenue) for the major players in the TV, radio,

and newspaper segments.

2007 Market Share

21%

8%0%

17%

6%

0%

16%

7%

0%

10%

32%

10%

0.06

0

0

2%

2%

0%

0%

18%

30%

0%5%

24%

0%

9%

0%

0%

0%

24%

28%

13% 13%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Radio TV Newspaper

Astral Corus Rogers CTVglobemedia Newcap Cogeco

Canwest Quebecor CBC Torstar Others

Figure 1. Media Market Share, 2007

Source. CRTC Communications Monitoring Report; 2008

The largest media company in Canada is CTVglobemedia, with estimated 2007 revenue of $2.2 billion (Figure 2). The largest public

company, based on 2007 revenue, was Canwest with $2.0 billion, followed by Quebecor with $1.1 billion.

Revenue by Segment - Top Media Companies (2007)

0.70.6 0.6

2.2

0.1 0.1

2.0

1.1

0.5

0.8

1.5

0.0

0.5

1.0

1.5

2.0

2.5

Ast

ral

Co

rus

Ro

ge

rs

CT

Vg

lob

em

ed

ia

Ne

wc

ap

Co

ge

co

Ca

nw

est

Qu

eb

ec

or

CB

C

To

rsta

r

Oth

ers

($ b

)

Radio TV Newspaper

Figure 2. Revenue by Segment, 2007



7

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

A C O N N E C T E D N A T I O N

Canada enjoys the highest broadband Internet penetration rate among the G7, although it also has the lowest wireless penetration

in the G7. The entire country potentially has access to high-speed Internet services with which to access media in new ways.

Canadians enjoy broad access to high-speed services – 93% of households can access broadband using landline (cable or

telephony) facilities. This increases to almost 100% including satellite. Sixty-four percent of Canadians subscribe to high-speed

Internet access, with 59% at speeds greater than 5Mbps (allowing the access of video-streaming, for example). Ninety-eight

percent of the country can access wireless services, with 78% able to subscribe to 3G or equivalent speeds. The change in consumer

access was brought about by the change in the access network from a landline twisted-pair based communications network to an

interconnected multiplatform network that provides Canadians with voice and data communications when and where they want

it. This also created a blurring of the lines between the traditional broadcasting and telecommunications companies. Cable

companies now offer telecom services, while telecom companies offer TV services.

Canadian Internet subscribers reached 9.3 million in 2007, up 16.6% CAGR from 7.0 million in 2003 (Figure 3). In addition, the vast

majority (89.9%) now access the Internet through a high-speed connection.

Canadian Internet Subscribers

2,500 2,025 1,568 1,239 934

4,513 5,416 6,429 7,461 8,356

7,0137,441

7,9978,700

9,290

0

2000

4000

6000

8000

10000

2003 2004 2005 2006 2007

(00

0)

Dial-up High-speed

Figure 3. Canadian Internet Subscribers


The increased penetration rates have also been accompanied by significant growth in the time consumers spend online. As Figure

4 shows, average weekly hours spent online in the Anglophone market has more than tripled since 1997.

Average Weekly Hours Spent Online

4.85.6

9.3

11.7

13.4

4.1

6.37.7

9.19.8

0

2

4

6

8

10

12

14

16

1997 1999 2002 2005 2007

(ho

urs

)

Anglophones Francophones

Figure 4. Average Weekly Hours Spent Online



8

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

B U T H I G H D E B T L E V E L S I N C R E A S E F I N A N C I A L P R E S S U R E S

Due to significant consolidation over the past few years, many of the companies in the media sector are burdened with high debt

levels (Figure 5). The median Debt/Equity for the 46 companies in our Canadian Media universe has increased from 9.5% in 1999

to 72.4% as at 2008. The median Debt/Capital level has increased from 10.4% to 44.0%. Median Debt/EBITDA has increased from

0.4x to 2.5x.

Increasing Debt Levels

9.5

36.6 36.2 37.0 37.631.0

48.3

61.1 64.072.4

10.4

27.5 27.3 26.9 27.2 29.035.7 37.4 38.9

44.0

0

20

40

60

80

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

(%)

0.0

0.5

1.0

1.5

2.0

2.5

3.0

(X)

Median Debt / Equity (%) Median Debt / Capital (%) Median Debt / EBITDA

Figure 5. High Debt Levels

Source. Capital IQ

W E A K S T O C K P R I C E P E R F O R M A N C E R E F L E C T S T O U G H E C O N O M I C E N V I R O N M E N T

These high debt levels, coupled with the toughest economic environment in decades, have placed significant pressure on the

Canadian media sector. Only four companies (out of 50) in our Canadian Media universe have had positive price performance over the

past year: Pareto Corporation (TSX:PTO) +96%, Newfoundland Capital Corporation Ltd. (TSX:NCC.A) +8%, Peace Arch Entertainment

Group Inc. (AMEX:PAE) +1% and IMAX Corporation (NasdaqGM:IMAX) +1%. The median price performance is -43% (Figure 6).

One-Year Price Performance

Median, -43%

-125%

-75%

-25%

25%

75%

125%

TS

X:C

GS

NY

SE

:LG

FT

SX

:CG

OO

TC

BB

:UO

MO

TS

X:R

NK

TS

XV

:XD

MO

TC

PK

:ES

ITT

SX

V:F

RV

TS

X:G

VC

TS

X:T

CL

.AT

SX

V:M

NC

.AT

SX

:QB

R.B

TS

XV

:SA

TT

SX

:EC

GT

SX

V:B

TV

TS

X:F

P.U

NT

SX

:KO

ST

SX

:CX

TS

XV

:LM

TS

X:B

CE

TS

X:Y

LO

.UN

Na

sda

qG

S:M

DC

TS

X:F

MN

TS

X:S

OM

.UN

TS

X:T

RI

TS

X:M

HR

TS

X:S

CR

TS

X:T

VA

.BT

SX

:MB

TT

SX

:CG

X.U

NT

SX

:CC

AT

SX

:CR

WT

SX

:JT

VT

SX

:CJR

.BT

SX

:TT

SX

:SJR

.BT

SX

V:M

PZ

TS

X:A

CM

.AT

SX

:RC

I.BT

SX

:TS

.BA

IM:E

TO

TS

XV

:BD

PT

SX

:XS

RT

SX

:DH

XT

SX

V:E

MA

ME

X:P

AE

Na

sda

qG

M:IM

AX

TS

X:N

CC

.AT

SX

:PT

O

Figure 6. One-year Price Performance

Source. Capital IQ


9

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

I N E V I T A B L E L A Y O F F S H A V E B E G U N

As Figure 7 shows, there have been over 6,400 layoffs announced in the Canadian media sector over the past year, as media

companies attempt to cut costs.

Date Company #

17-Apr-08 Torstar 160

30-May-08 Cossette Communications 40

19-Aug-08 Astral Media 28

10-Nov-08 Lionsgate 41

12-Nov-08 CanWest 560

27-Nov-08 CTVglobemedia 105

2-Dec-08 Rogers Media 100

5-Dec-08 Telus 100

12-Dec-08 Manitoba Telecom Services 170

16-Dec-08 Quebecor 600

20-Jan-09 Astral Media 23

21-Jan-09 Bell Canada 1,600

4-Feb-09 Corus 12

5-Feb-09 MDC Partners 60

18-Feb-09 Transcontinental 1500

4-Mar-09 Cinram 200

4-Mar-09 CTVglobemedia 118

8-Mar-09 Cossette Communications 55

11-Mar-09 FP Can. Newspapers 20

26-Mar-09 CBC 800

28-Mar-09 Lionsgate 27

17-Apr-09 Bell Canada 100

Total 6,419

Layoffs Announced

Figure 7. Layoffs

Source. Company reports


10

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

T H E M E D I A R E V E N U E M O D E L I S U N D E R P R E S S U R E

There are two basic ways media companies make money – through subscriptions and advertising. Consumers traditionally paid for

media through subscriptions and accessed the content through a specific channel. Advertisers paid the media companies because

of their access to these large groups of consumers. However, both sources of revenue are undergoing significant change. The most

targeted consumers, i.e. the younger age categories, now expect to access media on their terms – at the time, place, and through

the channel they want. They also expect to be able to interact with the content. This has resulted in changes in media consumption

patterns, which we discuss in more detail below.

On the supply side, advertisers have been under tremendous pressure due to the economic environment. This has caused

significant shifts in media buying patterns and budgets. For example, auto companies have traditionally been among the largest

advertisers. With car sales down 30% or more, advertising budgets have tightened considerably.

C O N S U M E R S C H A N G I N G T H E I R B E H A V I O U R

Historically, consumers paid some kind of subscription fee for different types of media. For TV, consumers typically signed up for

some package of channels (often with little specific choice as to which channels they could access). Newspapers charge a monthly

fee for consumers that want home delivery, or a one-time fee for consumers to make “spot” purchases of the newspaper. Radio is

free to consumers – once they’ve purchased the access device (i.e. the radio excluding newer satellite radio services which charge

a subscription fee).

I N T E R N E T / M O B I L E C A U S I N G S T R U C T U R A L C H A N G E I N A C C E S S I N G C O N T E N T

The way in which consumers access and interact with media has changed significantly over the past few years. Traditionally,

consumers accessed media through three mediums – television, radio, and publishing (newspapers and magazines). With the

introduction of widespread Internet access and the roll-out of high-speed 3G mobile networks throughout Canada, consumers

now have new ways to access, and more importantly interact with, media. Before, the Internet/mobile access delivery of media was

essentially a one-way street – from broadcasters to consumers. Now, consumers, particularly highly-coveted younger consumers,

expect to interact with media in many ways – by sharing it with friends on social networks, "tweeting" about something they saw,

and providing commentary and recommendations on everything from the latest hit viral video to pictures of a recent event from

around the world. Consumers can create customized Internet radio stations with the specific channels or music types they want.

In addition, whereas content was previously created by the broadcasters (or licensed by them to present to consumers), consumers

are now the creators of content as well (Figure 8).


11

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

U S E R S N O W C O N T E N T C R E A T O R S

A good example of how content creation has changed is Youtube. The incredible rise of Youtube, bought by Google for $1.65 billion

in 2006, shows just how much content users are creating. According to web analytics site Alexa, Youtube is the third largest site on

the Internet (ranked by traffic), reaching approximately 18% of global Internet users. According to Cisco, video traffic now comprises

almost one-third of Internet traffic globally – and it is mostly user-generated content (UGC) that is being sent around the world.

eMarketer estimates that over 40% of Internet users in the U.S. created and uploaded content in 2008 (Figure 9).

Figure 8. Media Access/Creation Changing

Source. Research Capital

U.S. UGC Creators

0

20

40

60

80

100

120

2008 2009 2010 2011 2012 2013

(mm

)

0%

10%

20%

30%

40%

50%

60%

(%)

Creators % of Internet Users

Figure 9. U.S. User-generated Content Creators

Source. eMarketer; December 2008


12

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

C O N S U M E R S A R E M U L T I - T A S K I N G – B U T O N L Y W I T H C E R T A I N F O R M S O F M E D I A

While Internet usage has grown significantly, recent studies show that Internet users often interact with other forms of media while

using the Internet. Figure 10 shows that TV leads (among traditional media) with 54% of Internet users also watching TV while

online. In contrast, print media (magazine and newspaper) is FAR below with only 8% of users also participating in those media

while online. Again, we believe this is a reflection of the changing nature of media interaction. TV itself has become more interactive,

with shows such as “American Idol” or “Who Wants to be a Millionaire” driving significant audience participation (more people vote

for the American Idol than do for the American President). The online social interaction for users is often around events they are

watching on TV – e.g. the Olympics, American Idol, the Oscars, etc. This is evident in the “trending topics” area on Twitter, where

major events of the moment often drive increased usage of social media. While the increased usage of PVR technology (30% of U.S.

households have PVR’s, according to Nielsen) and time-shifting (time spent watching up 33% Y/Y) mean that viewers don’t HAVE

to watch at the same time, a significant majority of watching is still done at the scheduled broadcast time. On the other hand,

reading a newspaper is a 1-1 experience between just the reader and the paper – people read the paper at all times of the day, not

just when their friends are reading.

Activities participated while online

59% 59%

54%

48%45%

32% 32%28%

21% 20% 19%17%

8% 8% 7% 7%4%

0%

10%

20%

30%

40%

50%

60%

70%

Lis

ten

to

mu

sic

Ta

lk o

n t

he

ph

on

e

Wa

tch

TV

Ha

ve

a s

na

ck

Ea

t a

me

al

Lis

ten

to

th

e r

ad

io

Inte

rac

tin

g w

ith

oth

er

pe

op

le

Ho

me

cle

ric

al w

ork

(pa

y b

ills

etc

)

Offi

ce

wo

rk

Pla

y v

ide

ga

me

s

Do

ho

use

wo

rk/c

ho

res

Co

ok

ing

Re

ad

a m

ag

azi

ne

Re

ad

a n

ew

s p

ap

er

Re

ad

a b

oo

k

Ex

erc

ise

Pla

y b

oa

rd g

am

es

Figure 10. Activities Participated While Online

Source. GfK Roper; November 2008

A D V E R T I S I N G E X P E N D I T U R E S A R E C H A N G I N G

Advertising: “… using sponsored commercial messages to build a brand and paying to locate these messages where they will be

observed by potential customers performing other activities; these messages describe a product or service, its price or fundamental

attributes, where it can be found, its explicit advantages, or the implicit benefits from its use…”

Eric Clemons, Professor of Operations and Information Management at the Wharton School at the University of Pennsylvania

Media companies historically generated revenue from advertisers willing to pay for access to the broad markets of consumers the

media companies could deliver. The reason they paid was that the media companies could deliver both mass (large markets) and

segmented audiences (e.g. those that listen to country music within a specific city).


13

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

A D V E R T I S E R S S H I F T I N G E X P E N D I T U R E S F R O M N E W S P A P E R S / R A D I O T O O N L I N E

In addition to the change in consumer behaviour (demand), advertising expenditures are expected to shift significantly over the

next few years (Figure 11). On a global basis, ZenithOptimedia estimates that TV will remain the largest medium for advertising

expenditures globally, and will increase its share slightly (+5.0%) from 37.4% in 2007 to 39.2% in 2011. Newspaper expenditures are

expected to drop from 27.0% of the total to 21.6% by 2001 – a fall of 19.8%. Magazine and radio expenditures are also expected to

fall significantly – from 12.1% to 10.1% (-16.5%) and from 8.0% to 7.2% (-10.7%), respectively. Cinema and Outdoor are both

expected to grow, albeit off much smaller bases. Internet advertising is the big winner though – expected to grow from 8.7% of

global expenditures to 14.6% by 2011, or up by almost 70%.

Global Advertising Expenditure by Medium

37% 38% 39% 39% 39%

27% 25% 24% 23% 22%

9% 10% 12% 13% 15%

12% 11% 11% 10% 10%

8% 8% 7% 7% 7%

6% 7% 7% 7% 7%0% 1% 1% 1% 1%

0%

20%

40%

60%

80%

100%

2007 2008 2009 2010 2011

Television Newspapers Internet Magazines Radio Outdoor Cinema

Figure 11. Global Advertising Expenditure, by Medium

Source. ZenithOptimedia; April 2009

In the Canadian market, as Figure 12 shows, advertising revenue rose for all mediums except newspapers in 2007. The highest

growth rate was for mobile advertising which grew by 145% in 2007, albeit from a small base of just $1.1 million. Television was the

largest segment at $3.3 billion, up 1.8%. Newspaper advertising revenue fell by 2.4% to $2.6 billion. Internet advertising revenue

was up a robust 38% to $1.2 billion, not far behind radio which increased 5.8% to $1.5 billion.

Advertising Revenue by Medium

3,241

2,635

1,388

900682

370

1

3,299

2,572

1,4681,241

718422

3

0

500

1000

1500

2000

2500

3000

3500

Television Daily Newspaper Radio Internet Magazines Out-of-home Mobile

($ m

m)

2006 2007

Figure 12. Canadian Advertising Revenue, by Medium

Source. IAB Canada


14

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

Internet advertising revenue may have passed radio in 2008 as the IAB (Internet Advertising Bureau) estimated Internet ad revenue

increased by a further 21% in 2008 to $1.5 billion (Figure 13).

Canadian Online Advertising Revenue

5098 86

176237

364

562

900

1241

1500

0

200

400

600

800

1000

1200

1400

1600

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

($ m

m)

Figure 13. Canadian Online Advertising Revenue

Source. IAB Canada

W H O A D V E R T I S E S O N L I N E I N C A N A D A ?

Figure 14 shows the distribution of online advertising revenue in Canada in 2007 by segment. The largest segment is Automotive

at 16%, followed by Financial at 11%. In light of the economic situation facing the automotive sector, Automotive will likely fall

significantly in 2009 and perhaps beyond.

2007 Online Advertising Revenue By Segment

10%

7%

11%

7%

6%

9%

16%

27%

7%

Automotive - 16%

Financial - 11%

Technology - 10%

Telecommunications - 7%

Leisure - 7%

Media, Entertainment - 7%

Packaged Goods - 6%

Retail - 9%

Other - 27%

Figure 14. Online Advertising Revenue, by Segment (2007)

Source. IAB Canada

O N L I N E A D V E R T I S I N G – F A C I N G I T S O W N C H A L L E N G E S

All media companies have, to one degree or another, made some move into the online world. We have even seen several U.S.

newspapers move to an online-only model in a desperate attempt to avoid complete closure. The question investors need to ask

is: can moving online replace the revenue streams lost in the offline world? We believe it will be extremely challenging for media

companies to fully replace their lost offline revenue with online revenue IF their only revenue model is advertising. There are several

reasons for this.


15

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

C P M S D R O P S I G N I F I C A N T L Y

As Figure 15 shows, CPMs (the price publishers charge per 1,000 impressions) have continued to drop significantly online, DESPITE the

continued strong growth of the Internet. Overall, CPMs have fallen by 50% from Q4/07 to Q4/08 – from US$0.50 to US$0.26. The decreased

CPMs are likely a result of massive increases in available ad inventory, as overall advertising dollars have continued to grow.

Web CPMs

0.260.270.340.37

0.50

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

Q4/07 Q1/08 Q2/08 Q3/08 Q4/08

($)

Small Websites(1) Medium Websites (2) Large Websites (3) Total Websites (4)

Figure 15. Web CPMs Drop

Source. PubMatic; January 14, 2009

SNS Advertising Spending

1.4

2.0

2.42.6

2.9

3.2

3.546%

18%

10%11%

10%11%

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

2007 2008 2009 2010 2011 2012 2013

(US

$ b

)

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Spend Growth

Figure 16. Social Network Advertising Spending

Source. eMarketer; March 2009

E V E N A D V E R T I S I N G G R O W T H O N S O C I A L N E T W O R K S I S S L O W I N G

Figure 16 shows that even advertising on social networks is only expected to grow by 17.5% in 2009, after growth of 46.4% in 2008.

Growth is expected to slow even further in 2010 and beyond to roughly 10% per year.


16

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

This is still above overall advertising revenue growth rates, but far below the growth in the social networks themselves (from a

number of users perspective). Figure 17 shows that Member Communities (aka Social Networks) recently passed e-mail as the

highest usage (by minutes) of any online type of property.

Figure 17. Internet Properties Usage

Source. Neilsen-Online

So what can the media companies do? The following sections review the TV, radio, and newspaper segments, the changes within

each of those segments, and the primary market participants.


17

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

T E L E V I S I O N S T I L L K I N G

2007 Commercial TV Revenue

9%

8%11%

2%

7%

18%

6%5%

2%

32%

CTVglobemedia - 32%

Canwest/Alliance Atlantis - 18%

CBC - 9%

Astral - 8%

Rogers/CHUM - 7%

Corus - 6%

Quebecor Media - 5%

BCE/Telus/MTS/SaskTel/Shaw - 2%

Cogeco - 2%

Others - 11%

Figure 18. Commercial TV Revenue Market Share, 2007


The TV segment is controlled by seven companies which generated 85% of revenue in 2007 (Figure 18). The largest is CTVglobemedia

(32%), followed by CanWest (18%) and the CBC (9%). Household penetration of TV is very high, with the cable BDU footprint

covering 12.4 million households. Of those, 90% subscribe for TV services.

T V C O N S U M P T I O N S T I L L G R O W I N G

Overall, TV viewing has not been in decline. In fact, as Figure 19 shows, for the total audience, weekly hours viewed has risen slightly

to 26.8 hours. In the age 18+ category, viewing has increased from 28.1 hours in 2004-2005 to 29.2 hours in 2006-2007.

National Average Weekly Viewing Hours

(Monday to Sunday, 6 am to 6 am)

26.1

18 18.7

28.1

21.223.5

2626.9

18.2 18.8

29.0

21.2

24.2

27.026.8

18.1 18.5

29.2

21.2

2426.5

0

5

10

15

20

25

30

35

All ages (2+) Children (2-11) Teens (12-17) 18+ 18-34 18-49 25-54

(ho

urs

)

2004-05 2005-06 2006-07

Figure 19. National TV Consumption, by Age



18

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

Recent U.S. statistics show the same pattern, with TV viewing increasing in Q4/08 by 3.6% compared to the prior year (Figure 20).

This despite concern that increased Internet usage would result in a decline in TV usage.

4Q08 3Q08 4Q07

Watching TV in the home 151:03 140:48 145:49 3.6% 5:13

Watching Timeshifted TV 7:11 6:27 5:24 33.0% 1:47

Using the Internet 27:04 27:18 26:08 3.6% 0:56

Watching Video on Internet 2:53 2:31

Using a Mobile Phone 3:42 3:37

Monthly Time Spent in Hours: Minutes Per User 2+

%Diff. Yr to Yr.

Figure 20. Time Spent Watching Video

Source. The Nielsen Company

B U T T H E R E V E N U E G E N E R A T E D F R O M T V H A S C H A N G E D

TV broadcasting companies generate revenue primarily through advertising and subscriptions. Conventional over-the-air (OTA) TV

is free to consumers and the TV broadcaster sells advertising on the TV station. The CRTC governs how much advertising is allowed

and how much Canadian content is required for conventional OTA TV. In addition, TV broadcasters generate revenue from non-

conventional channels, i.e. from Pay, Pay-per-View (PPV), Video-on-Demand (VOD), and Specialty channels through subscription fees

from consumers.

Although TV viewing in aggregate has increased, the revenue generated by the broadcasters has changed in composition. As

Figures 21 and 22 show, revenue from subscription sources, i.e. from the Pay, PPV, VOD, and Specialty segments, has increased from

$4.1 billion in 2003 to $5.0 billion in 2007, a CAGR of 5.4%. Advertising revenue increased at a slower rate from $2.8 billion to $3.3

billion (3.9% CAGR). Even the advertising revenue growth has been largely driven by increases in non-conventional TV. Conventional

TV revenue grew just 1.4% from $2.22 billion to $2.35 billion over that period. In total, Pay, PPV, VOD, and Specialty now represent

more than half (53.3%) of total revenue generated.

Television Revenue Growth

6% 7%

11%

10%

17%

9%

15%

8%

1%

4%

0%1%

5%

3%

9%

4%5%

2%

8%

2%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

2004 2005 2006 2007

Pay, PPV, VOD, Specialty - subscription

Pay, PPV, VOD, Specialty

Private conventional OTATotal

Advertising revenue

Figure 22. Television Revenue Growth, by Type


Television Revenue

1929 1940 2012 2020 2040

291 316 233 339 310607 708 769

882 949

12501331 1419

1580 1732

50314821

443342954077

23502359224522562220

0

1,000

2,000

3,000

4,000

5,000

6,000

2003 2004 2005 2006 2007

($ m

m)

Pay, PPV, VOD, Specialty - subscription

Pay, PPV, VOD, Specialty

CBC conventional OTA

Private conventional OTA

Conventional

Figure 21. Television Revenue, by Type



19

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

W H Y I S S P E C I A L T Y G R O W I N G F A S T E R ?

We believe that the primary reason for the significant difference in TV consumption of conventional TV versus Specialty (including

Pay, PPV, and VOD) TV is simple: content. Specialty TV offers consumers differentiated content. Conventional TV offers the same

content that consumers can get from multiple sources – often for free. There are numerous websites that carry conventional TV

shows, under an ad-supported model such as Hulu or Joost. Consumers can also access the types of content directly. For example,

consumers interested in sports have access to enhanced content through MLB.com, NBA.com, etc. It isn’t necessary for a sports fan

to access their sports content through the TV anymore. However, that generally applies, for example, to the major sports leagues

– for more specialized content, TV is often still the best way to access it. And again, TV itself has become more interactive, whereby

consumers can interact with each other and the media creators for example by voting on which are the “plays of the day.” TV

broadcasters are also starting to embrace other forms of media, in conjunction with the TV itself, whereby consumers can, for

example, view a sports game on TV, then see highlights on their mobile device and comment on a blog.

T V T a k e a w a y : i n c r e a s e d v i e w i n g , g r o w i n g r e v e n u e , m o r e i n t e r a c t i o n , f o c u s o n c o n t e n t


20

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

R A D I O C H A L L E N G I N G T I M E S A H E A D

The radio segment is dominated by six companies which generated 72% of revenue in 2007 (Figure 23). Astral is the largest

company in the radio segment post its acquisition of Standard with a market share of 21%. Corus is next with 17%, followed closely

by Rogers with 16%.

2007 Commercial Radio Revenue Market Share

16%

10%

6%

17%

2%

28%

21%

Astral (incl Standard) -21%

Corus -17%

Rogers -16%

CTVglobemedia -10%

Newcap -6%

Cogeco -2%

Others -28%

Figure 23. Commercial Radio Revenue Market Share, 2007


R A D I O C O N S U M P T I O N I N D E C L I N E

As Figure 24 shows, radio consumption has declined across ALL age segments over the past few years. In aggregate, weekly hours

tuned has fallen from 19.5 hours to 18.3 hours, an annual decline of 1.6% over the past five years. Adults age 18-24 have seen weekly

hours tuned fall from 16.3 to 13.3 (-5.0% CAGR), while 25-34 year olds have seen a -2.6% CAGR from 19.3 to 17.4 hours.

Average Weekly Hours Tuned per Capita (Radio)

0

5

10

15

20

25

All 12+ Teens (12-17) 18-24 25-34 35-49 50-54 55-64 65+

(ho

urs

)

2003 2004 2005 2006 2007

Figure 24. Weekly Hours of Radio, by Age



21

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

While this must be of concern to the radio companies, consumers don’t (directly) pay for radio content because radio companies

generate their revenue almost entirely through advertising. As Figure 25 shows, while revenue in the radio segment has not

declined overall so far, with the significant drop in hours tuned, advertisers will not be willing to pay as much for a declining market

audience. Moreover, consumers now have the ability to tune into literally thousands of radio channels on the Internet or on their

mobile devices – for free. In addition, advertising budgets have been under significant pressure due to the current economic

conditions. As the media companies don’t have the steady revenue generation from subscriptions that the TV companies can

enjoy, we believe that companies in the radio segment could be at significant risk of substantial declines in revenue.

Radio Revenue

884 9241031 1093

1173

306303

306322

329

0

200

400

600

800

1000

1200

1400

1600

2003 2004 2005 2006 2007

($ m

m)

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

FM AM AM growth FM growth

Figure 25. Radio Revenue, by Segment


R a d i o T a k e a w a y : d e c r e a s e d l i s t e n i n g , s l o w i n g r e v e n u e g r o w t h , l i t t l e i n t e r a c t i o n


22

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

N E W S P A P E R O V E R T H E E D G E O F T H E C L I F F

The most obvious media segment at risk is the newspaper segment. The news (ironically) is full of stories of layoffs and the shutting

down (or moving to an online-only model) of newspapers. The newspaper segment in Canada is also dominated by a few large

players. Quebecor and CanWest are the largest (based on circulation) with an estimated 27% share each. Torstar is the next biggest

with 14%, followed by Power Corp. with 10% and CTVglobemedia with 7% (Figure 26).

Canadian Newspaper Market Share (by Circulation)

27%14%

10%

15%

7%

27% CanWest - 27%

Quebecor/Sun Media/Osprey - 27%

Torstar - 14%

Power Corp. - 10%

CTVglobemedia - 7%

Other - 15%

Figure 26. Newspaper Market Share, by Circulation, 2007


N E W S P A P E R R E V E N U E I N P R E C I P I T O U S D E C L I N E

Newspapers generate revenue from circulation (23.5% of total) and advertising (76.5%). As Figure 27 shows, circulation revenue has

declined at an accelerating rate. Advertising revenue has also fallen.

Canadian Daily Newspaper Revenue

616

699

604

740

621

682

599

732

626658

591

696

188 198 200 203 203 203 205 208 204 203 201 201

0

100

200

300

400

500

600

700

800

Q1/05 Q2/05 Q3/05 Q4/05 Q1/06 Q2/06 Q3/06 Q4/06 Q1/07 Q2/07 Q3/07 Q4/07

($ m

m)

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

Advertising Circulation Circulation (Y/Y) Advertising (Y/Y)

Figure 27. Canadian Daily Newspaper Revenue, by Type



23

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

However, online advertising revenue for newspapers grew by almost 30% in 2007 (Figure 28) versus a 2.1% decline in traditional

newspaper revenue. Note though that at $196 million of annual revenue, online advertising is still less than 1/10 the size of

traditional newspaper advertising.

Newspaper Online Advertising Revenue

152

196

0

50

100

150

200

250

2006 2007

($ m

m)

Figure 28. Online Newspaper Advertising Revenue

Source. Canadian Newspaper Association

U.S. Newspaper Advertising Revenue

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

Ma

r-0

3

Se

p-0

3

Ma

r-0

4

Se

p-0

4

Ma

r-0

5

Se

p-0

5

Ma

r-0

6

Se

p-0

6

Ma

r-0

7

Se

p-0

7

Ma

r-0

8

Se

p-0

8

Ma

r-0

9

(US

$ m

m)

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

Online

Classified

Advertising

Online (Y/Y %)

Classified (Y/Y %)

Advertising (Y/Y %)

Figure 29. U.S. Newspaper Advertising Revenue, by Type

Source. Newspaper Association of America

While 2008 figures for the Canadian newspaper industry have not been released, the data from the United States paints a

frightening picture (Figure 29). Advertising revenue fell by over 24% in Q1/09 while classified revenue fell by an outstanding 42%.

Even online revenue fell, down 13.4% in Q1/09.


24

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

A C A S E S T U D Y : T H E N Y T I M E S – I F I T C A N ’ T M A K E I T …

A quick study of The New York Times paints an ominous picture for any company in the newspaper business. According to Alexa,

The Times is the sixth largest news site on the Internet. Web analytics firm Compete calculates the nytimes.com’s Unique Visitors

(UV) at 16.7 million as at the end of March 2009, up from 13.7 million as at March 2008. The company itself noted that the total UV

for The New York Times Company, including about.com, boston.com, and nytimes.com was 52.3 million, up 4% from 50.4 million

as at March 2008. However, despite this, Internet revenue declined 5.6% Y/Y to US$78.2 million in Q1/09 (ended March), with

advertising revenue dropping 6.1% to US$67.6 million. Internet revenue accounted for just 12.8% of total company revenue, albeit

up from 11.1% the prior year. Simple math suggests that the revenue generated per UV for the quarter was approximately $0.50

(78.2 /[52.3*3]). According to Nielsen-Online (Figure 30), online UV for the newspaper industry in the U.S. reached record levels in

January 2009 at 74.8 million. Page views per unique visitor have ranged from 45-50 per month for several years. Therefore, assuming

47.5 page views per UV per month, The Times would have generated roughly 7.5 billion page views in Q1/09. This implies a CPM

of $10.55 – far higher than the overall average website CPM of $0.26 in Q4/08 estimated by PubMatic (January 2009).

U.S. Newspaper Online Unique Visitors

0

10,000,000

20,000,000

30,000,000

40,000,000

50,000,000

60,000,000

70,000,000

80,000,000

Jan

-04

Ma

r-0

4

Ma

y-0

4

Jul-

04

Se

p-0

4

No

v-0

4

Jan

-05

Ma

r-0

5

Ma

y-0

5

Jul-

05

Se

p-0

5

No

v-0

5

Jan

-06

Ma

r-0

6

Ma

y-0

6

Jul-

06

Se

p-0

6

No

v-0

6

Jan

-07

Ma

r-0

7

Ma

y-0

7

Jul-

07

Se

p-0

7

No

v-0

7

Jan

-08

Ma

r-0

8

Ma

y-0

8

Jul-

08

Se

p-0

8

No

v-0

8

Jan

-09

0

10

20

30

40

50

60

Unique Audience Pages Per Person

Figure 30. U.S. Newspaper Unique Visitors/Page Views

Source. Nielsen Online, MegaPanel Data

We believe that the higher CPM demonstrates that advertisers still value The Times as a site worth advertising on. The issue is that

the audience itself just isn’t large enough in absolute terms to make up for the losses offline. Why hasn’t the newspaper industry

generated the online traffic that would seem to be within their reach?


25

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

W H Y A R E N E W S P A P E R S I N S U C H B A D S H A P E ?

While growth rates have slowed in the TV and radio segment, they generally have not gone negative to the extent we have seen

in the newspaper segment. Why? We believe it is a function of (a) the change in consumer consumption habits, as we discussed

previously, and (b) the significant decline in advertising revenue due to declining audiences and the current economic environment.

Consumers are demanding access to content when, where, and how they want. Newspapers by their very nature are unable to

deliver this. Television has evolved, with the VCR, and now PVR, VOD or time-shifting that gives consumers much greater choice in

when they access the content. In addition, many TV shows are now available online, especially in the U.S. market. Consumers can

even access TV shows on their mobile devices (although they do so in very limited numbers in Canada so far). Radio content is

accessible through satellite – wherever the consumer is. And the satellite companies generate their revenue through subscriptions.

Satellite radio also offers consumers much greater selection and specialization of choice. Newspapers can be read in two ways – by

buying (or subscribing) to a newspaper or online.

D E V A S T A T I O N O F C L A S S I F I E D A D S

One area in which the newspaper industry has stumbled badly is classified advertising. The industry materially underestimated the

impact online classified sites such as Craigslist would have. As Figure 31 shows, Craigslist significantly outranks The New York Times

when it comes to daily traffic and daily page views.

Figure 31. Craigslist Outranks NY Times

Source. www.alexa.com

In total, Craigslist itself generates in excess of 20 billion page views per month – five times that of the entire U.S. newspaper industry!

As classified advertising was such a significant portion of the newspaper industry’s profitability, the loss of this traffic has been a

major reason for the decline in the industry’s financial performance.


26

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

M I C R O - B L O G G I N G G R O W I N G M A S S I V E L Y , B U T W I L L I T R E P L A C E N E W S P A P E R J O U R N A L I S M ?

We believe one of the primary reasons for the phenomenal growth of Twitter (the leading micro-blogging service) is the relevance

of now in search. Twitter users are communicating in real-time regarding events around the world. For example, Twitter users were

posting hundreds of updates PER SECOND when the terror attacks in Mumbai were occurring. Even the largest news organizations

in the world were unable to provide live updates to the extent “citizen journalists” were. And when someone wanted to find out

what was happening in Mumbai, by searching on Twitter, they could get live, continuously updated items as to what was

happening. The largest, most successful search company in the world, Google, couldn’t (currently) provide that relevancy. The

problem newspapers face is the same the railroad companies faced with the advent of the airline industry. And as the late Harvard

Professor Theodore Levitt described it, “they thought they were in the railroad business, not the transportation business.”

Newspapers should be in the journalism business – not the newspaper business. The challenge they face is how to generate the

revenue needed to pay for the journalists if they can’t generate it from advertising revenue. It should also be noted that a primary

function of newspapers is to serve as the “voice of the people.” Historically, it was newspapers that challenged local politicians to

remain straight because the newspapers would expose the wrongdoings of the politicians. It is unlikely this role will be filled by

bloggers – will they be willing to sit through a seven-hour local council meeting in order to serve as a check and balance? The

answer is, very unlikely.

N E W B U S I N E S S M O D E L S ?

The challenge newspapers face is in converting their legacy content business to one that is relevant in an online world. The

problem is – is an advertising-based Web model a viable one for newspapers? Despite record audiences for online newspapers

(Figure 30 above), as we showed, online newspaper advertising growth went negative in Q2/08 and the decline is accelerating. At

the end of the day, the core problem that the newspaper industry fixed through their economies of scale, that of solving the

incredible cost and complexity of making information available to the public, is no longer a problem thanks to the Internet.

Newspapers will have to embrace new business models to generate revenue if advertising isn’t going to work. One example of a

potential model is online subscriptions. However, even the largest newspapers in the world, such as The New York Times, have not

demonstrated the ability to monetize their customer base in such a way to replace their lost offline business. Others have suggested

using other, proven, online business models such as virtual goods or e-commerce in the newspaper industry. We believe that the

most important resource the newspaper industry still has is context. With their long history, newspapers can provide levels of

context around current events that is well beyond the capabilities of almost any blogger.

C A N T H E K I N D L E S A V E T H E N E W S P A P E R I N D U S T R Y ?

One possible way for newspapers to generate increased subscription revenue would be through the use of electronic book (or

e-book) readers such as Amazon’s Kindle. These devices, with WiFi access, could be subsidized by the newspapers, in the same way

cell phones are subsidized by the mobile carriers, in order to lock in consumers to a subscription. By offering an e-book reader for

a much lower upfront price point, but coupled with a two or three-year subscription, newspapers could guarantee themselves a

locked-in audience that could perhaps be monetized in other ways as well. Amazon has recently announced the Kindle DX, which

some newspapers (The New York Times, The Washington Post, etc.) will be subsidizing if the consumer commits to a subscription

– in areas where home delivery of that paper is not available.

N e w s p a p e r T a k e a w a y : s i g n i f i c a n t d r o p i n r e a d e r s h i p , f a l l i n g r e v e n u e , l i t t l e i n t e r a c t i o n


27

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

M E D I A S E C T O R F I N A N C I A L R A N K I N G

We have created a financial metric ranking system in order to compare the companies in the Canadian Media sector. Our five key

financial metrics are revenue (last 12 months – LTM), revenue growth, EBITDA margin, net cash, and operating cash flow (cash flow

from operations excluding changes in non-cash working capital). We weight each metric equally and then rank each of the

companies based on their score.

R E V E N U E

The revenue ranking (Figure 32) is dominated by the traditional telecom companies, which took three of the top five spots: BCE

with $17.7 billion of LTM revenue (#1), Rogers $11.3 billion (#3), and Telus $9.7 billion (#4). Thomson Reuters ranks second with $14.4

billion, while Quebecor ranked fifth with $3.7 billion. The top five collectively generated $56.8 billion of revenue or 68.5% of the

total. Fifteen companies (30%) generated over $1 billion in revenue, while 25 companies (50%) generated under $100 million.

# Company Ticker

Revenue

($ mm) # Company Ticker

Revenue

($ mm)

1 BCE, Inc. TSX:BCE 17,698.0 26 Newfoundland Capital Corp. Ltd. TSX:NCC.A 97.3

2 Thomson Reuters Corporation TSX:TRI 14,368.0 27 Xentel DM Inc. TSXV:XDM 96.2

3 Rogers Communications Inc. TSX:RCI.B 11,335.0 28 McGraw-Hill Ryerson Ltd. TSX:MHR 94.6

4 TELUS Corporation TSX:T 9,653.0 29 Somerset Entertainment Income Fund TSX:SOM.UN 85.6

5 Quebecor Inc. TSX:QBR.B 3,730.1 30 Pareto Corp. TSX:PTO 77.2

6 Shaw Communications, Inc. TSX:SJR.B 3,178.5 31 Peace Arch Entertainment Group Inc. AMEX:PAE 72.9

7 CanWest Global Communications Corp. TSX:CGS 3,164.9 32 DHX Media Ltd. TSX:DHX 70.9

8 Transcontinental Inc. TSX:TCL.A 2,429.3 33 Cyberplex Inc. TSX:CX 57.3

9 Cinram International Income Fund TSX:CRW 2,332.0 34 Canadian Satellite Radio Holdings Inc TSX:XSR 43.8

10 Manitoba Telecom Services, Inc. TSX:MBT 1,921.5 35 Rainmaker Entertainment Inc. TSX:RNK 37.7

11 Lions Gate Entertainment Corp. NYSE:LGF 1,859.1 36 Score Media Inc. TSX:SCR 37.6

12 Yellow Pages Income Fund TSX:YLO.UN 1,696.7 37 JumpTV Inc. TSX:JTV 16.5

13 Torstar Corporation TSX:TS.B 1,536.0 38 Multimedia Nova Corp. TSXV:MNC.A 15.4

14 Cogeco Inc. TSX:CGO 1,157.0 39 Asian Television Network International Ltd. TSXV:SAT 14.6

15 Cogeco Cable Inc. TSX:CCA 1,124.4 40 Empirical Inc. TSXV:EM 10.5

16 Astral Media Inc. TSX:ACM.A 912.1 41 Envoy Capital Group, Inc. TSX:ECG 10.3

17 Cineplex Entertainment Limited Partnership TSX:CGX.UN 849.7 42 MPL Communications Inc. TSXV:MPZ 5.8

18 Corus Entertainment Inc. TSX:CJR.B 789.1 43 Fluid Music Canada, Inc. TSX:FMN 5.7

19 MDC Partners Inc. NasdaqGS:MDCA 717.5 44 FRV Media, Inc. TSXV:FRV 4.6

20 TVA GROUP Inc. TSX:TVA.B 436.7 45 Knightscove Media Corp. TSXV:KC.A 3.9

21 Entertainment One Ltd. AIM:ETO 430.7 46 Broadview Press Inc. TSXV:BDP 3.2

22 Cossette Communication Group Inc. TSX:KOS 252.0 47 BlueRush Media Group Corp. TSXV:BTV 2.9

23 Glacier Media, Inc. TSX:GVC 249.1 48 Lingo Media Corporation TSXV:LM 1.0

24 IMAX Corporation NasdaqGM:IMAX 124.0 49 UOMO Media, Inc OTCBB:UOMO 0.6

25 FP Canadian Newspapers Limited Partnership TSX:FP.UN 121.1 50 E-SOL International Corp. OTCPK:ESIT 0.0

Revenue Run Rate Ranking

Figure 32. Revenue Ranking, Q4/08

Source. Capital IQ


28

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

R E V E N U E G R O W T H

E-Sol International had the highest revenue growth (Figure 34), up 575%, followed by Lingo Media (+254%) and UOMO Media up

75.6%, albeit both off very small bases. Cyberplex had the next highest growth, up 69%. Ten (20%) of the companies experienced

negative revenue growth in Q4.

# Company Ticker

Growth rate

(Y/Y %) # Company Ticker

Growth rate

(Y/Y %)

1 E-SOL International Corp. OTCPK:ESIT 575.2 26 TELUS Corporation TSX:T 1.3

2 Lingo Media Corporation TSXV:LM 254.0 27 Pareto Corp. TSX:PTO 1.0

3 UOMO Media, Inc OTCBB:UOMO 75.6 28 Quebecor Inc. TSX:QBR.B 1.0

4 Cyberplex Inc. TSX:CX 69.2 29 Yellow Pages Income Fund TSX:YLO.UN 0.8

5 Fluid Music Canada, Inc. TSX:FMN 28.5 30 Torstar Corporation TSX:TS.B 0.7

6 JumpTV Inc. TSX:JTV 24.8 31 TVA GROUP Inc. TSX:TVA.B 0.7

7 DHX Media Ltd. TSX:DHX 20.6 32 CanWest Global Communications Corp. TSX:CGS 0.6

8 Lions Gate Entertainment Corp. NYSE:LGF 17.8 33 Corus Entertainment Inc. TSX:CJR.B 0.2

9 MDC Partners Inc. NasdaqGS:MDCA 15.8 34 Empirical Inc. TSXV:EM 0.0

10 Cinram International Income Fund TSX:CRW 14.6 35 Entertainment One Ltd. AIM:ETO 0.0

11 BlueRush Media Group Corp. TSXV:BTV 13.5 36 FRV Media, Inc. TSXV:FRV 0.0

12 IMAX Corporation NasdaqGM:IMAX 12.8 37 Peace Arch Entertainment Group Inc. AMEX:PAE 0.0

13 Canadian Satellite Radio Holdings Inc TSX:XSR 10.9 38 Somerset Entertainment Income Fund TSX:SOM.UN 0.0

14 Astral Media Inc. TSX:ACM.A 5.4 39 BCE, Inc. TSX:BCE -0.2

15 Cogeco Cable Inc. TSX:CCA 4.4 40 Cossette Communication Group Inc. TSX:KOS -0.5

16 Cogeco Inc. TSX:CGO 4.3 41 Manitoba Telecom Services, Inc. TSX:MBT -0.7

17 Cineplex Entertainment Limited Partnership TSX:CGX.UN 3.5 42 FP Canadian Newspapers Limited Partnership TSX:FP.UN -4.4

18 Score Media Inc. TSX:SCR 3.3 43 Multimedia Nova Corp. TSXV:MNC.A -4.8

19 McGraw-Hill Ryerson Ltd. TSX:MHR 3.0 44 Rainmaker Entertainment Inc. TSX:RNK -5.0

20 Asian Television Network International Ltd. TSXV:SAT 2.6 45 Newfoundland Capital Corp. Ltd. TSX:NCC.A -5.3

21 Shaw Communications, Inc. TSX:SJR.B 2.4 46 MPL Communications Inc. TSXV:MPZ -5.5

22 Rogers Communications Inc. TSX:RCI.B 2.3 47 Knightscove Media Corp. TSXV:KC.A -7.3

23 Glacier Media, Inc. TSX:GVC 1.8 48 Broadview Press Inc. TSXV:BDP -8.0

24 Xentel DM Inc. TSXV:XDM 1.7 49 Envoy Capital Group, Inc. TSX:ECG -8.5

25 Transcontinental Inc. TSX:TCL.A 1.5 50 Thomson Reuters Corporation TSX:TRI -12.4

Year-over-Year Growth Rate Ranking

Figure 34. Revenue Growth Ranking, Q4/08

Source. Capital IQ

Media Revenue

0

20

40

60

80

100Q

2/0

3

Q3

/03

Q4

/03

Q1

/04

Q2

/04

Q3

/04

Q4

/04

Q1

/05

Q2

/05

Q3

/05

Q4

/05

Q1

/06

Q2

/06

Q3

/06

Q4

/06

Q1

/07

Q2

/07

Q3

/07

Q4

/07

Q1

/08

Q2

/08

Q3

/08

Q4

/08

($ b

)

-20%

0%

20%

40%

60%

Revenue (LHS) Q/Q growth (RHS) Y/Y growth (weighted avg) (RHS)

Figure 33. Media Revenue, by Quarter

Source. Capital IQ

The total for the Media universe (Figure 33) was $82.9 billion in Q4/08, down 0.7% sequentially from $83.5 billion in Q3/08. Overall,

revenue in Q4/08 was still 17.3% higher than Q4/07 ($70.7 billion).


29

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

E B I T D A M A R G I N

Yellow Pages had the highest EBITDA margin in the Media universe (Figure 35), a robust 55.4%. In second place was Shaw with

42.6%, followed by Telus at 39.8%. The top five averaged 43.3%. Eleven companies (23%) had negative EBITDA margins, with UOMO

Media’s -91.6% being the lowest.

# Company Ticker

EBITDA

margin (%) # Company Ticker

EBITDA

margin (%)

1 Yellow Pages Income Fund TSX:YLO.UN 55.4 25 Cinram International Income Fund TSX:CRW 13.3

2 Shaw Communications, Inc. TSX:SJR.B 42.6 26 DHX Media Ltd. TSX:DHX 10.7

3 TELUS Corporation TSX:T 39.8 27 BlueRush Media Group Corp. TSXV:BTV 9.8

4 Cogeco Cable Inc. TSX:CCA 39.6 28 MDC Partners Inc. NasdaqGS:MDCA 9.4

5 Cogeco Inc. TSX:CGO 38.9 29 Newfoundland Capital Corp. Ltd. TSX:NCC.A 9.3

6 BCE, Inc. TSX:BCE 37.3 30 Rainmaker Entertainment Inc. TSX:RNK 9.2

7 Rogers Communications Inc. TSX:RCI.B 36.8 31 Pareto Corp. TSX:PTO 8.9

8 Astral Media Inc. TSX:ACM.A 33.3 32 Cyberplex Inc. TSX:CX 8.3

9 Manitoba Telecom Services, Inc. TSX:MBT 33.0 33 Entertainment One Ltd. AIM:ETO 7.5

10 Corus Entertainment Inc. TSX:CJR.B 31.7 34 Multimedia Nova Corp. TSXV:MNC.A 5.5

11 Quebecor Inc. TSX:QBR.B 30.1 35 Xentel DM Inc. TSXV:XDM 5.5

12 Thomson Reuters Corporation TSX:TRI 22.7 36 MPL Communications Inc. TSXV:MPZ 4.9

13 Glacier Media, Inc. TSX:GVC 20.6 37 Peace Arch Entertainment Group Inc. AMEX:PAE -4.1

14 FP Canadian Newspapers Limited Partnership TSX:FP.UN 19.3 38 Knightscove Media Corp. TSXV:KC.A -5.1

15 McGraw-Hill Ryerson Ltd. TSX:MHR 18.6 39 Lions Gate Entertainment Corp. NYSE:LGF -5.1

16 CanWest Global Communications Corp. TSX:CGS 17.8 40 Broadview Press Inc. TSXV:BDP -8.7

17 Cineplex Entertainment Limited Partnership TSX:CGX.UN 17.1 41 IMAX Corporation NasdaqGM:IMAX -12.9

18 Somerset Entertainment Income Fund TSX:SOM.UN 16.5 42 Empirical Inc. TSXV:EM -21.8

19 Asian Television Network International Ltd. TSXV:SAT 16.5 43 FRV Media, Inc. TSXV:FRV -53.9

20 Score Media Inc. TSX:SCR 15.4 44 JumpTV Inc. TSX:JTV -62.6

21 TVA GROUP Inc. TSX:TVA.B 15.1 45 Canadian Satellite Radio Holdings Inc TSX:XSR -65.2

22 Transcontinental Inc. TSX:TCL.A 14.9 46 Envoy Capital Group, Inc. TSX:ECG -68.7

23 Cossette Communication Group Inc. TSX:KOS 13.8 47 UOMO Media, Inc OTCBB:UOMO -91.6

24 Torstar Corporation TSX:TS.B 13.7

EBITDA Margin Ranking

Figure 35. EBITDA Margin Ranking, Q4/08

Source. Capital IQ


30

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

N E T C A S H

Fully 80% (40 companies) in the universe had negative net cash balances (Figure 36). Ten companies had net debt greater than $1

billion, led by BCE with net debt of $9.2 billion. The highest net cash balance belonged to E-SOL, with $105.0 million.

# Company Ticker

Net cash


Net cash

($ mm)

1 E-SOL International Corp. OTCPK:ESIT 105.0 26 TVA GROUP Inc. TSX:TVA.B -88.6

2 McGraw-Hill Ryerson Ltd. TSX:MHR 43.9 27 Entertainment One Ltd. AIM:ETO -96.5

3 JumpTV Inc. TSX:JTV 33.5 28 FP Canadian Newspapers Limited Partnership TSX:FP.UN -108.4

4 Envoy Capital Group, Inc. TSX:ECG 20.3 29 Glacier Media, Inc. TSX:GVC -111.4

5 Cossette Communication Group Inc. TSX:KOS 18.4 30 Canadian Satellite Radio Holdings Inc TSX:XSR -126.6

6 Fluid Music Canada, Inc. TSX:FMN 18.4 31 MDC Partners Inc. NasdaqGS:MDCA -172.0

7 Lingo Media Corporation TSXV:LM 2.3 32 IMAX Corporation NasdaqGM:IMAX -187.8

8 Cyberplex Inc. TSX:CX 1.8 33 Lions Gate Entertainment Corp. NYSE:LGF -232.0

9 Asian Television Network International Ltd. TSXV:SAT 0.9 34 Cineplex Entertainment Limited Partnership TSX:CGX.UN -324.5

10 BlueRush Media Group Corp. TSXV:BTV 0.5 35 Torstar Corporation TSX:TS.B -627.3

11 MPL Communications Inc. TSXV:MPZ -0.2 36 Corus Entertainment Inc. TSX:CJR.B -700.6

12 UOMO Media, Inc OTCBB:UOMO -0.3 37 Transcontinental Inc. TSX:TCL.A -705.7

13 Broadview Press Inc. TSXV:BDP -0.4 38 Cinram International Income Fund TSX:CRW -707.8

14 Knightscove Media Corp. TSXV:KC.A -1.3 39 Manitoba Telecom Services, Inc. TSX:MBT -757.5

15 Pareto Corp. TSX:PTO -1.4 40 Astral Media Inc. TSX:ACM.A -785.1

16 Xentel DM Inc. TSXV:XDM -2.0 41 Cogeco Cable Inc. TSX:CCA -1,195.3

17 Score Media Inc. TSX:SCR -4.7 42 Cogeco Inc. TSX:CGO -1,210.6

18 Somerset Entertainment Income Fund TSX:SOM.UN -5.3 43 Yellow Pages Income Fund TSX:YLO.UN -2,684.3

19 Rainmaker Entertainment Inc. TSX:RNK -7.3 44 Shaw Communications, Inc. TSX:SJR.B -3,043.3

20 FRV Media, Inc. TSXV:FRV -9.2 45 CanWest Global Communications Corp. TSX:CGS -3,893.0

21 Multimedia Nova Corp. TSXV:MNC.A -9.9 46 Quebecor Inc. TSX:QBR.B -4,453.8

22 Empirical Inc. TSXV:EM -11.8 47 TELUS Corporation TSX:T -6,348.0

23 DHX Media Ltd. TSX:DHX -56.5 48 Thomson Reuters Corporation TSX:TRI -8,195.9

24 Peace Arch Entertainment Group Inc. AMEX:PAE -58.5 49 Rogers Communications Inc. TSX:RCI.B -8,526.0

25 Newfoundland Capital Corp. Ltd. TSX:NCC.A -71.7 50 BCE, Inc. TSX:BCE -9,241.0

Net Cash Ranking

Figure 36. Net Cash Ranking, Q4/08

Source. Capital IQ


31

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

Overall, the group has a negative net cash position of $54.5 billion, down a further $4.0 billion from Q3/08, and down $19.1 billion

from Q4/07 (Figure 38). This is despite $22.0 billion in operating cash flow during the quarter – a record for cash flow generated.

Canadian Media Cash and Cash Flow

-60

-50

-40

-30

-20

-10

0

Q2

/03

Q3

/03

Q4

/03

Q1

/04

Q2

/04

Q3

/04

Q4

/04

Q1

/05

Q2

/05

Q3

/05

Q4

/05

Q1

/06

Q2

/06

Q3

/06

Q4

/06

Q1

/07

Q2

/07

Q3

/07

Q4

/07

Q1

/08

Q2

/08

Q3

/08

Q4

/08

($ b

)

0

5

10

15

20

25

($ b

)

Total cash (LHS) Operating cash flow (RHS)

Figure 38. Media Universe Cash and Operating Cash Flow, by Quarter

Source. Capital IQ

# Company Ticker

Op cash flow


Op cash

flow ($ mm)

1 BCE, Inc. TSX:BCE 6,190.0 26 Newfoundland Capital Corp. Ltd. TSX:NCC.A 10.9

2 Thomson Reuters Corporation TSX:TRI 4,138.5 27 FP Canadian Newspapers Limited Partnership TSX:FP.UN 10.6

3 Rogers Communications Inc. TSX:RCI.B 3,275.0 28 Pareto Corp. TSX:PTO 9.7

4 TELUS Corporation TSX:T 2,911.0 29 Score Media Inc. TSX:SCR 9.3

5 Shaw Communications, Inc. TSX:SJR.B 1,350.8 30 Envoy Capital Group, Inc. TSX:ECG 3.1

6 Quebecor Inc. TSX:QBR.B 803.2 31 Asian Television Network International Ltd. TSXV:SAT 2.3

7 Yellow Pages Income Fund TSX:YLO.UN 675.1 32 JumpTV Inc. TSX:JTV 1.7

8 Manitoba Telecom Services, Inc. TSX:MBT 590.4 33 Xentel DM Inc. TSXV:XDM 1.1

9 Cogeco Inc. TSX:CGO 314.2 34 Broadview Press Inc. TSXV:BDP 0.6

10 Transcontinental Inc. TSX:TCL.A 314.0 35 MPL Communications Inc. TSXV:MPZ 0.5

11 Cogeco Cable Inc. TSX:CCA 301.9 36 UOMO Media, Inc OTCBB:UOMO 0.3

12 Cineplex Entertainment Limited Partnership TSX:CGX.UN 142.9 37 Knightscove Media Corp. TSXV:KC.A 0.2

13 Corus Entertainment Inc. TSX:CJR.B 129.6 38 E-SOL International Corp. OTCPK:ESIT 0.0

14 Astral Media Inc. TSX:ACM.A 125.6 39 BlueRush Media Group Corp. TSXV:BTV -0.1

15 Cinram International Income Fund TSX:CRW 114.9 40 Multimedia Nova Corp. TSXV:MNC.A -0.1

16 Torstar Corporation TSX:TS.B 103.2 41 Lingo Media Corporation TSXV:LM -0.9

17 CanWest Global Communications Corp. TSX:CGS 101.4 42 Cyberplex Inc. TSX:CX -1.4

18 Lions Gate Entertainment Corp. NYSE:LGF 93.5 43 Empirical Inc. TSXV:EM -3.6

19 MDC Partners Inc. NasdaqGS:MDCA 79.5 44 FRV Media, Inc. TSXV:FRV -6.2

20 Cossette Communication Group Inc. TSX:KOS 69.7 45 Rainmaker Entertainment Inc. TSX:RNK -7.4

21 TVA GROUP Inc. TSX:TVA.B 51.9 46 Canadian Satellite Radio Holdings Inc TSX:XSR -14.2

22 Glacier Media, Inc. TSX:GVC 48.5 47 Fluid Music Canada, Inc. TSX:FMN -14.4

23 Entertainment One Ltd. AIM:ETO 37.3 48 Peace Arch Entertainment Group Inc. AMEX:PAE -26.6

24 McGraw-Hill Ryerson Ltd. TSX:MHR 33.1 49 DHX Media Ltd. TSX:DHX -27.4

25 Somerset Entertainment Income Fund TSX:SOM.UN 20.0 50 IMAX Corporation NasdaqGM:IMAX -33.2

Operating Cash Flow Ranking

Figure 37. Operating Cash Flow Ranking, Q4/08

Source. Capital IQ

O P E R A T I N G C A S H F L O W

BCE had the highest operating cash flow (Figure 37) of $6.2 billion, followed by Thomson Reuters ($4.1 billion), Rogers ($3.3 billion), Telus

($2.9 billion), and Shaw ($1.4 billion). The group as a whole generated $22 billion in operating cash flow. The top five generated $17.9 billion

or 85% of the total. Twelve companies (24%) had negative operating cash flow, with IMAX the lowest at -$33.2 million.


32

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

Overall

Rank Company Ticker

Rev

($ mm) Rank

Rev

growth

(%) Rank

EBITDA

(%) Rank

Net cash

($ mm) Rank

Op cash

flow

($ mm) Rank

Net

score

1 Shaw Communications, Inc. TSX:SJR.B 3,178.5 6 2.4 18 42.6 2 -3,043.3 41 1,350.8 5 174

2 Rogers Communications Inc. TSX:RCI.B 11,335.0 3 2.3 19 36.8 7 -8,526.0 46 3,275.0 3 168

3 TELUS Corporation TSX:T 9,653.0 4 1.3 23 39.8 3 -6,348.0 44 2,911.0 4 168

4 Cogeco Cable Inc. TSX:CCA 1,124.4 15 4.4 12 39.6 4 -1,195.3 38 301.9 11 166

5 Cogeco Inc. TSX:CGO 1,157.0 14 4.3 13 38.9 5 -1,210.6 39 314.2 9 166

6 McGraw-Hill Ryerson Ltd. TSX:MHR 94.6 28 3.0 16 18.6 15 43.9 1 33.1 24 164

7 Astral Media Inc. TSX:ACM.A 912.1 16 5.4 11 33.3 8 -785.1 37 125.6 14 160

8 Yellow Pages Income Fund TSX:YLO.UN 1,696.7 12 0.8 26 55.4 1 -2,684.3 40 675.1 7 160

9 Quebecor Inc. TSX:QBR.B 3,730.1 5 1.0 25 30.1 11 -4,453.8 43 803.2 6 156

10 BCE, Inc. TSX:BCE 17,698.0 1 -0.2 36 37.3 6 -9,241.0 47 6,190.0 1 155

11 Cineplex Entertainment Limited Partnership TSX:CGX.UN 849.7 17 3.5 14 17.1 17 -324.5 31 142.9 12 155

12 Cinram International Income Fund TSX:CRW 2,332.0 9 14.6 7 13.3 25 -707.8 35 114.9 15 155

13 Transcontinental Inc. TSX:TCL.A 2,429.3 8 1.5 22 14.9 22 -705.7 34 314.0 10 150

14 MDC Partners Inc. NasdaqGS:MDCA 717.5 19 15.8 6 9.4 28 -172.0 28 79.5 19 146

15 Manitoba Telecom Services, Inc. TSX:MBT 1,921.5 10 -0.7 38 33.0 9 -757.5 36 590.4 8 145

16 Lions Gate Entertainment Corp. NYSE:LGF 1,859.1 11 17.8 5 -5.1 39 -232.0 30 93.5 18 143

17 Corus Entertainment Inc. TSX:CJR.B 789.1 18 0.2 30 31.7 10 -700.6 33 129.6 13 142

18 Cossette Communication Group Inc. TSX:KOS 252.0 22 -0.5 37 13.8 23 18.4 4 69.7 20 142

19 Glacier Media, Inc. TSX:GVC 249.1 23 1.8 20 20.6 13 -111.4 26 48.5 22 142

20 Thomson Reuters Corporation TSX:TRI 14,368.0 2 -12.4 47 22.7 12 -8,195.9 45 4,138.5 2 138

21 CanWest Global Communications Corp. TSX:CGS 3,164.9 7 0.6 29 17.8 16 -3,893.0 42 101.4 17 135

22 Asian Television Network International Ltd. TSXV:SAT 14.6 39 2.6 17 16.5 19 0.9 6 2.3 31 134

23 Torstar Corporation TSX:TS.B 1,536.0 13 0.7 27 13.7 24 -627.3 32 103.2 16 134

24 Cyberplex Inc. TSX:CX 57.3 33 69.2 2 8.3 32 1.8 5 -1.4 40 133

25 TVA GROUP Inc. TSX:TVA.B 436.7 20 0.7 28 15.1 21 -88.6 23 51.9 21 133

26 Score Media Inc. TSX:SCR 37.6 36 3.3 15 15.4 20 -4.7 14 9.3 29 132

27 JumpTV Inc. TSX:JTV 16.5 37 24.8 3 -62.6 44 33.5 2 1.7 32 130

28 Somerset Entertainment Income Fund TSX:SOM.UN 85.6 29 0.0 35 16.5 18 -5.3 15 20.0 25 124

29 Pareto Corp. TSX:PTO 77.2 30 1.0 24 8.9 31 -1.4 12 9.7 28 121

30 BlueRush Media Group Corp. TSXV:BTV 2.9 46 13.5 8 9.8 27 0.5 7 -0.1 38 118

31 Xentel DM Inc. TSXV:XDM 96.2 27 1.7 21 5.5 35 -2.0 13 1.1 33 117

32 FP Canadian Newspapers Limited Partnership TSX:FP.UN 121.1 25 -4.4 39 19.3 14 -108.4 25 10.6 27 116

33 DHX Media Ltd. TSX:DHX 70.9 32 20.6 4 10.7 26 -56.5 20 -27.4 46 115

34 Entertainment One Ltd. AIM:ETO 430.7 21 0.0 31 7.5 33 -96.5 24 37.3 23 111

35 UOMO Media, Inc OTCBB:UOMO 0.6 47 75.6 1 -91.6 47 -0.3 9 0.3 36 105

36 Newfoundland Capital Corp. Ltd. TSX:NCC.A 97.3 26 -5.3 42 9.3 29 -71.7 22 10.9 26 101

37 IMAX Corporation NasdaqGM:IMAX 124.0 24 12.8 9 -12.9 41 -187.8 29 -33.2 47 93

38 Canadian Satellite Radio Holdings Inc TSX:XSR 43.8 34 10.9 10 -65.2 45 -126.6 27 -14.2 44 84

39 Envoy Capital Group, Inc. TSX:ECG 10.3 41 -8.5 46 -68.7 46 20.3 3 3.1 30 82

40 MPL Communications Inc. TSXV:MPZ 5.8 42 -5.5 43 4.9 36 -0.2 8 0.5 35 82

41 Rainmaker Entertainment Inc. TSX:RNK 37.7 35 -5.0 41 9.2 30 -7.3 16 -7.4 43 79

42 Multimedia Nova Corp. TSXV:MNC.A 15.4 38 -4.8 40 5.5 34 -9.9 18 -0.1 39 76

43 Peace Arch Entertainment Group Inc. AMEX:PAE 72.9 31 0.0 31 -4.1 37 -58.5 21 -26.6 45 75

44 Broadview Press Inc. TSXV:BDP 3.2 45 -8.0 45 -8.7 40 -0.4 10 0.6 34 71

45 Knightscove Media Corp. TSXV:KC.A 3.9 44 -7.3 44 -5.1 38 -1.3 11 0.2 37 71

46 Empirical Inc. TSXV:EM 10.5 40 0.0 31 -21.8 42 -11.8 19 -3.6 41 68

47 FRV Media, Inc. TSXV:FRV 4.6 43 0.0 31 -53.9 43 -9.2 17 -6.2 42 64

Total 82,925.0 -54,643.9 21,945.3

Average 5.4 7.3

Overall Financial Metric Rankings

Figure 39. Media Universe Financial Metric Ranking, Q4/08

Source. Capital IQ

O V E R A L L S C O R E

Based on an equal weighting of all five financial metrics (Figure 39), Shaw is the highest ranked company overall with a score of 174.

Shaw ranked sixth in revenue, eighteenth in revenue growth, second in EBITDA margin, forty-first in net cash, and fifth in operating

cash flow. Tied for second place are Rogers and Telus with 168 points. Cogeco Cable and Cogeco tied for fourth with 166 points.


33

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

Company Subsector

Market

Cap. (C$)

Ent. Value

(C$) Close

Net Cash

per Share as % Recommendation

12 Month

Target

Implied

Return

Open Text KMS OTEX 2,002.5 1,892.4 US$34.72 -US$1.25 -3.6% Buy US$42.00 21.0%

Corus Media CJR.B 1,185.3 1,851.3 $14.81 -$8.32 -56.2% Hold $15.25 6.9%

Quebecor Media QBR.B 1,164.0 5,598.1 $18.10 -$68.95 -380.9% Buy $26.00 44.8%

Cyberplex Media CX 84.2 79.2 $1.57 $0.09 5.9% Buy $4.25 170.7%

Points Industry PTSE.F 81.9 78.4 US$0.50 -US$0.02 -4.9% Buy US$0.75 50.3%

Mediagrif eMarketplace MDF 54.4 26.1 $3.80 $1.97 51.9% Buy $6.00 57.9%

Tucows Internet Infra TCX 33.0 31.5 US$0.45 -US$0.02 -4.6% Buy US$0.85 88.9%

Medipattern HealthTech MKI 9.6 8.6 $0.22 $0.02 10.6% Speculative Buy $0.70 218.2%

Big Stick Sports Info BSM 8.4 9.9 $0.35 -$0.06 -17.3% Speculative Buy $2.25 542.9%

Coverage company summary

Figure 41. Coverage Universe

Source. Company reports, Research Capital estimates

I N I T I A T I N G C O V E R A G E

We are initiating coverage on three companies in the Media sector (Figure 41): Corus Entertainment Inc. (TSX:CJR.B; HOLD, $15.25

TP), Cyberplex (TSX:CX; BUY, $4.25 TP), and Quebecor Inc. (TSX:QBR.B; BUY, $26.00 TP).

H I S T O R I C A L R A N K I N G S

This is the first top ranking for Shaw (Figure 40). Shaw has ranked in the top three eight times in the last 12 quarters. Telus has been

in the top three four times, and Rogers five times.

Rank Mar-06 Jun-06 Sep-06 Dec-06 Mar-07 Jun-07 Sep-07 Dec-07 Mar-08 Jun-08 Sep-08 Dec-08

1 TSX:ACM.A TSX:ACM.A TSX:ACM.A TSX:ACM.A TSX:ACM.A TSX:ACM.A TSX:TRI TSX:TRI TSX:TRI TSX:TRI TSX:TRI TSX:SJR.B

2 TSX:YLO.UN TSX:YLO.UN TSX:YLO.UN TSX:TRI TSX:YLO.UN TSX:SJR.B TSX:ACM.A TSX:RCI.B TSX:SJR.B TSX:SJR.B TSX:RCI.B TSX:RCI.B

3 TSX:T TSX:SJR.B TSX:T TSX:YLO.UN TSX:T TSX:YLO.UN TSX:SJR.B TSX:SJR.B TSX:RCI.B TSX:RCI.B TSX:SJR.B TSX:T

4 TSX:RCI.B TSX:T TSX:SJR.B TSX:T TSX:CCA TSX:T TSX:RCI.B TSX:T TSX:T TSX:T TSX:T TSX:CCA

5 TSX:SJR.B TSX:BCE TSX:RCI.B TSX:SJR.B TSX:RCI.B TSX:RCI.B TSX:T TSX:YLO.UN NYSE:LGF TSX:QBR.B TSX:CCA TSX:CGO

6 TSX:RNK TSX:RCI.B TSX:BCE TSX:CCA TSX:SJR.B TSX:CCA TSX:YLO.UN TSX:CCA TSX:QBR.B TSX:CRW TSX:ACM.A TSX:MHR

7 TSX:KOS TSX:CCA TSX:CCA TSX:RCI.B TSX:CGO TSX:CGO TSX:CCA TSX:CGO TSX:CCA TSX:CCA TSX:CGO TSX:ACM.A

8 TSX:BCE TSX:SOM.UN TSX:CGO TSX:CGO TSX:BCE TSX:BCE TSX:CGO TSX:BCE TSX:CGO TSX:ACM.A TSX:YLO.UN TSX:YLO.UN

9 TSX:MHR TSX:MBT TSX:KOS TSX:BCE TSX:TRI TSX:ECG TSX:BCE TSX:MBT TSX:YLO.UN TSX:CGO TSX:QBR.B TSX:QBR.B

10 TSX:TCL.A TSX:CGX.UN TSX:GVC TSX:CRW TSX:KOS TSXV:SAT TSX:CGX.UN TSX:ACM.A TSX:ACM.A TSX:YLO.UN TSX:CRW TSX:BCE

11 TSX:CGX.UN TSX:CGO TSX:CGX.UN TSX:GVC TSX:CGS TSX:CJR.B TSX:KOS TSX:KOS TSX:BCE TSX:BCE TSX:MBT TSX:CGX.UN

12 TSX:CCA TSX:KOS TSX:MBT TSXV:SAT TSXV:SAT TSX:GVC TSX:MHR TSX:CGS TSX:MBT TSX:CGS TSX:BCE TSX:CRW

13 TSX:CGO TSX:GVC TSX:CJR.B TSX:KOS TSX:GVC TSX:SCR TSX:ECG TSX:CRW TSX:CGS TSX:MBT TSX:MHR TSX:TCL.A

14 TSX:GVC TSX:NCC.A TSXV:SAT NYSE:LGF TSX:MBT TSX:CGS TSX:MBT TSX:MHR AIM:ETO TSX:MHR NYSE:LGF NasdaqGS:MDCA

15 TSX:MBT TSX:TRI TSX:TRI TSX:SCR TSX:CGX.UN TSX:CGX.UN TSX:CGS TSX:CJR.B TSX:TVA.B TSX:NCC.A TSX:TCL.A TSX:MBT

16 TSXV:SAT TSX:TCL.A TSX:SCR TSX:CJR.B TSX:CJR.B TSX:TCL.A TSXV:SAT TSX:TCL.A TSX:TCL.A TSX:GVC TSX:GVC NYSE:LGF

17 NYSE:LGF TSXV:SAT TSX:TCL.A TSX:MBT TSX:TCL.A TSX:MBT TSX:TCL.A TSX:TVA.B TSX:MHR TSX:CJR.B TSX:CGS TSX:CJR.B

18 TSX:TRI TSX:CJR.B TSX:SOM.UN TSX:TCL.A TSX:SCR TSX:RNK TSX:GVC TSX:FP.UN TSX:NCC.A TSX:CGX.UN NasdaqGS:MDCA TSX:KOS

19 TSX:CRW TSX:SCR TSX:QBR.B TSX:NCC.A TSX:CRW TSX:TRI TSX:RNK TSX:GVC TSX:CGX.UN TSX:TCL.A TSXV:SAT TSX:GVC

20 TSX:CJR.B TSX:CRW TSX:CRW NasdaqGS:MDCA TSX:TS.B TSX:MHR TSX:CJR.B TSX:QBR.B TSX:GVC TSX:TVA.B TSX:PTO TSX:TRI

21 NasdaqGS:MDCA TSX:MHR TSX:FP.UN TSX:MHR TSX:FP.UN TSX:FP.UN TSX:TVA.B TSX:SCR TSX:CJR.B TSX:CX TSX:FP.UN TSX:CGS

22 TSX:SCR TSX:QBR.B NYSE:LGF TSX:QBR.B TSX:ECG TSX:KOS TSX:SOM.UN TSX:JTV TSX:CRW TSX:TS.B TSX:CJR.B TSXV:SAT

23 TSX:NCC.A AIM:ETO TSX:MHR TSX:CGX.UN TSX:QBR.B TSX:PTO TSX:SCR TSX:CGX.UN TSX:SCR TSX:JTV TSX:SCR TSX:TS.B

24 TSX:CGS NasdaqGS:MDCA TSX:TS.B TSX:FP.UN NYSE:LGF TSX:TS.B TSX:FP.UN TSX:RNK TSX:FP.UN TSX:SCR TSXV:BTV TSX:CX

25 AIM:ETO TSX:TS.B TSX:NCC.A TSX:TS.B NasdaqGM:IMAX TSX:CRW TSX:QBR.B TSX:TS.B TSX:JTV TSX:FP.UN TSX:TS.B TSX:TVA.B

26 TSX:TS.B TSX:CGS TSX:CGS TSX:ECG TSX:PTO TSX:QBR.B TSX:TS.B TSX:CX TSX:CX NasdaqGS:MDCA TSX:TVA.B TSX:SCR

27 TSX:FP.UN TSX:FP.UN NasdaqGS:MDCA TSXV:MNC.A TSX:CX TSX:SOM.UN TSX:NCC.A TSX:PTO TSX:PTO TSX:KOS TSX:CX TSX:JTV

28 TSX:QBR.B TSX:RNK TSX:RNK TSX:TVA.B TSX:MHR TSX:TVA.B TSX:CRW TSX:SOM.UN TSX:TS.B TSX:SOM.UN TSX:CGX.UN TSX:SOM.UN

29 TSX:SOM.UN TSX:TVA.B TSX:TVA.B TSX:SOM.UN TSX:NCC.A TSX:CX TSX:CX TSXV:SAT TSX:RNK TSX:RNK TSX:SOM.UN TSX:PTO

30 TSXV:FRV OTCBB:UOMO TSXV:MPZ TSX:PTO TSX:SOM.UN NasdaqGS:MDCA TSX:DHX TSX:DHX TSX:SOM.UN AIM:ETO TSXV:KC.A TSXV:BTV

31 TSX:PTO NYSE:LGF AIM:ETO AMEX:PAE NasdaqGS:MDCA TSX:NCC.A TSXV:MNC.A NasdaqGS:MDCA TSX:DHX NYSE:LGF TSX:JTV TSXV:XDM

32 TSX:TVA.B TSXV:MPZ TSX:PTO TSX:CX TSX:TVA.B AMEX:PAE TSX:PTO TSXV:BDP NasdaqGS:MDCA TSXV:SAT AIM:ETO TSX:FP.UN

33 NasdaqGM:IMAX TSXV:BDP TSXV:BDP TSXV:XDM AMEX:PAE TSXV:FRV AMEX:PAE TSX:ECG TSXV:MNC.A TSX:DHX NasdaqGM:IMAX TSX:DHX

34 TSXV:EM AMEX:PAE TSX:DHX TSX:DHX TSXV:XDM NYSE:LGF TSXV:XDM TSX:NCC.A TSXV:SAT TSXV:XDM TSX:DHX AIM:ETO

35 TSXV:MPZ TSXV:MNC.A AMEX:PAE TSX:RNK TSX:DHX TSX:DHX NYSE:LGF TSXV:MNC.A TSX:KOS TSXV:MNC.A TSX:NCC.A OTCBB:UOMO

36 AMEX:PAE TSXV:FRV TSXV:FRV NasdaqGM:IMAX TSXV:BDP TSXV:XDM NasdaqGS:MDCA AMEX:PAE TSX:ECG AMEX:PAE TSX:KOS TSX:NCC.A

37 TSXV:XDM TSX:PTO TSXV:XDM TSX:CGS TSXV:MPZ TSXV:MNC.A TSXV:EM NYSE:LGF NasdaqGM:IMAX TSX:PTO TSXV:XDM NasdaqGM:IMAX

38 TSX:ECG TSXV:XDM TSXV:MNC.A TSXV:FRV TSXV:FRV AIM:ETO NasdaqGM:IMAX TSXV:XDM TSXV:XDM TSXV:MPZ TSX:RNK TSX:XSR

39 TSXV:MNC.A TSXV:EM TSX:CX TSXV:MPZ TSXV:MNC.A TSXV:MPZ TSXV:MPZ TSXV:BTV TSXV:BDP TSXV:BTV TSXV:EM TSX:ECG

40 TSX:DHX TSX:CX TSXV:EM AIM:ETO AIM:ETO NasdaqGM:IMAX OTCPK:ESIT AIM:ETO TSXV:BTV TSXV:EM TSX:XSR TSXV:MPZ

41 TSX:CX NasdaqGM:IMAX NasdaqGM:IMAX TSXV:EM TSX:RNK OTCPK:ESIT TSXV:FRV TSXV:MPZ TSXV:MPZ TSXV:BDP TSXV:MPZ TSX:RNK

42 OTCBB:UOMO TSX:DHX OTCBB:UOMO TSXV:BDP OTCBB:UOMO TSXV:LM AIM:ETO NasdaqGM:IMAX OTCPK:ESIT TSX:ECG TSXV:MNC.A TSXV:MNC.A

43 TSXV:BDP #N/A #N/A TSXV:LM OTCPK:ESIT TSXV:BDP TSXV:LM TSXV:LM AMEX:PAE NasdaqGM:IMAX TSX:ECG AMEX:PAE

44 #N/A #N/A #N/A OTCBB:UOMO TSXV:EM TSXV:EM TSXV:BDP TSXV:EM TSXV:FRV TSXV:FRV TSXV:BDP TSXV:BDP

45 #N/A #N/A #N/A #N/A TSXV:LM #N/A #N/A TSXV:FRV TSXV:EM #N/A AMEX:PAE TSXV:KC.A

46 #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A TSXV:FRV TSXV:EM

47 #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A TSXV:FRV

Historical Rankings - Canadian Media

Figure 40. Media Universe Financial Metric Ranking, Historical

Source. Capital IQ

C O R U S E N T E R T A I N M E N T I N C .

34

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

CORUS ENTERTAINMENT INC.( T S X : C J R . B )

We are initiating coverage on Corus Entertainment Inc. (Corus) with a HOLD recommendation and $15.25 target price.

A N I N T E G R A T E D M E D I A L E A D E R

Corus is a leading Canadian media company with interests in radio and television broadcasting. The company is also a producer

and distributor of children’s media.

C A N A D A ’ S S E C O N D L A R G E S T R A D I O O P E R A T O R

Corus is the second largest radio operator in Canada, with 52 stations having an audience reach of 27.5%. The company operates

radio stations in nine of the 10 largest population centres in Canada. Twenty-three of Corus’ radio stations ranked either first or

second (market share) as at October 2008. Corus competes with Astral Media, Rogers Media, and CTVglobemedia, as well as U.S.

radio stations in markets near the U.S. border.

The company focuses on its primary markets for growth, aiming to provide attractive programming, coupled with clustered

stations (AM and FM) in order to provide maximum operating leverage from the company’s audience. The majority of Corus’ radio

revenue is generated through advertising. Almost three-quarters of advertising revenue is from local advertisers.

S P E C I A L T Y A N D P R E M I U M T V F O C U S E D O N K I D S , T E E N S , A N D W O M E N

Corus’ TV group encompasses specialty television networks, premium pay television services, three local TV stations, and the

(formerly separated) Content group which produces and distributes TV programs and related merchandising products and rights.

Corus’ TV group generates revenue from advertising (specialty TV) and subscriber fees (specialty and premium). Corus has interests

in a number of leading networks focused on the kids, teen, and women markets. The company’s specialty networks include YTV,

Treehouse TV, W Network, and Country Music Television. Corus’ premium networks include Movie Central and Encore Avenue in

Western Canada. With revenue generated entirely from subscriber fees, the key to growth at the premium networks is increasing

the subscriber base. Movie Central has an over 40% penetration rate, which still provides plenty of room for expansion. With

increasing conversion to digital services, Corus is focused on delivering leading content in order to reduce churn and provide

incremental revenue sources. Corus also produces and distributes globally kid-focused media through Nelvana. Nelvana’s

merchandising includes the highly popular Franklin, Babar, Backyardigans, and the new hit Bakugan.

The TV market is a highly competitive one, with major competitors including CTVglobemedia, Canwest Global, Allarco, and Astral Media

for specialty and premium services. In the conventional broadcast segment, Corus competes with CTV, Global, Rogers, and others.

Corus’ TV groups are divided into two primary segments – Kids and Lifestyle, Drama and Movies. Through the integration of the

Content segment into the Kids unit, Corus intends to leverage its strong merchandising brands across its media platforms. The

Lifestyle, Drama and Movies unit targets a leadership position in the women aged 25-54 category by focusing on providing a strong

programming schedule in the targeted categories. The company is also working on new platforms for all of its content, including

mobile, interactive games, VOD, the Internet, etc. Corus’ radio web sites attract almost two million unique visitors monthly and YTV.

com alone gets more than two million visitors per month. Corus is also making its content more interactive, for example by

allowing viewers to submit videos to its iCarly show where they can interact with the show’s host.


35

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

F I N A N C I A L R E V I E W

R A D I O R E V E N U E D E C L I N E W O R S E N S , B U T T V R E M A I N S S T R O N G

Corus recently reported its Q2 (ended February 2009) results. Radio revenue (primarily advertising) decreased 6% Y/Y to $57.9

million (Figure 42), with local airtime revenue down 8% Y/Y and national airtime revenue down 5% Y/Y. TV revenue (advertising and

subscription) grew by 5% Y/Y to $123.4 million, driven by a 12% increase in subscriber revenue. This was offset by a 9% decrease in

advertising revenue. Corus currently generates approximately 65% of revenue from television and 35% from radio. With continued

pressure expected on advertising revenue, especially in the radio segment, we expect radio revenue to fall by 5.9% in F2009 to

$269.4 million. Television is expected to grow modestly by 3.3% to $518.3 million, with subscriber growth outpacing declines in

advertising. Overall revenue is expected to remain flat with F2008 levels at $787.7 million (Figure 42). We expect radio to experience

a further decline in F2010 – dropping by 2.2% to $263.5 million. We estimate 3.0% revenue growth for TV, to $533.9 million, with

overall revenue increasing 1.2% to $797.4 million.

Segmented Revenue, by Quarter

0

50

100

150

200

250

No

v-0

6

Fe

b-0

7

Ma

y-0

7

Au

g-0

7

No

v-0

7

Fe

b-0

8

Ma

y-0

8

Au

g-0

8

No

v-0

8

Fe

b-0

9

Ma

y-0

9

Au

g-0

9

No

v-0

9

Fe

b-1

0

Ma

y-1

0

Au

g-1

0

No

v-1

0

Fe

b-1

1

Ma

y-1

1

Au

g-1

1

($m

m)

-8%

-6%

-4%

-2%

0%

2%

4%

6%

8%(%

)

Radio (LHS)

Television (LHS)

Segmented Revenue, Annual

0

100

200

300

400

500

600

700

800

900

Au

g-0

7

Au

g-0

8

Au

g-0

9

Au

g-1

0

Au

g-1

1

($ m

m)

-8%

-6%

-4%

-2%

0%

2%

4%

6%

(%)

Television - yoy growth (RHS)

Radio - yoy growth (RHS)

Figure 42. Corus Segmented Revenue, by Quarter/Annual



36

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT EBITDA Margin, by Quarter & Segment

0

10

20

30

40

50

60

70

80

90

100

No

v-0

6

Fe

b-0

7

Ma

y-0

7

Au

g-0

7

No

v-0

7

Fe

b-0

8

Ma

y-0

8

Au

g-0

8

No

v-0

8

Fe

b-0

9

Ma

y-0

9

Au

g-0

9

No

v-0

9

Fe

b-1

0

Ma

y-1

0

Au

g-1

0

No

v-1

0

Fe

b-1

1

Ma

y-1

1

Au

g-1

1

($ m

m)

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

(%)

Radio (LHS) Television (LHS)

Radio (RHS) Television (RHS)

Annual Net Income and EPS

1.26

1.511.56

1.44

1.47

1.56

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

Au

g-0

7

F2

00

7A

Au

g-0

8

F2

00

8A

Au

g-0

9

F2

00

9E

Au

g-1

0

F2

01

0E

Au

g-1

1

F2

01

1E

($ m

m)

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

1.80

($)

Net earnings

Adjusted EPS (Diluted)

Consensus

Figure 43. Corus EBITDA, Net Income, and EPS, by Quarter/Annual


F I X E D C O S T I N R A D I O I M P A C T S M A R G I N S …

Segmented EBITDA for Q2/F09 highlighted the challenge facing Corus. Although radio revenue declined 5.8% Y/Y, operating profit

for radio fell by 30.9% compared to the prior year to $7.1 million or 12.3% of revenue. The issue facing Corus is the high level of fixed

costs inherent in the radio segment (Figure 43). The TV segment had the opposite experience, with operating profit rising by 7.9%

Y/Y, faster than revenue increased. The operating margin in the TV segment was 38.5%, up from 37.4% in the prior year. Based on

our expected further declines in radio revenue, we expect operating profit to decline 16.0% to $63.4 million or 23.5% of revenue

from $75.5 million (26.4%) the prior year. Operating profit for TV is estimated to remain flat Y/Y at $199.7 million. Overall, operating

profit is expected to decline 3.1% to $244.3 million or 31.0% of revenue compared to $252.1 million (32.0%) the prior year. Note that

the company has provided guidance of $255-$265 million of operating profit (reduced from $270-$280 million). We expect a

modest 1.9% increase in operating profit in F2010, to $248.9 million (31.2%). We are estimating a 15.7% drop in net income to $127.9

million in F2009 (Figure 43), or $1.51 EPS (adjusted). With further spending on programming increasing depreciation/amortization

in F2010, net income is forecast to drop to $118.9 million or $1.47 per share.


37

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

D E B T L E V E L S N O T A C O N C E R N

Corus had $666.0 million of net debt (Figure 45) as at the end of Q2/F09, reducing its net debt level by almost $35 million in the

quarter. Net debt/segment profit, a key company performance measure, stood at 2.65x, below the company’s 3.0x target level. Net

debt/Equity fell to 66.6% from 71.5% in Q1/F09. We expect the company’s debt/profit to remain well below 3.0x due to cash flow

generation and increasing operating profit.

… A N D C A S H F L O W

With decreasing operating margins, operating cash flow (cash flow from operations excluding changes in non-cash working capital)

fell to $23.1 million compared to $31.2 million in the prior year (Figure 44). We expect $105.2 million of operating cash flow in F2009,

down from $163.5 million in F2008. Our F2010 operating cash flow estimate is a modest increase to $106.7 million. Note that the

company is guiding to $70-$90 million in free cash flow for F2009 – we are estimating $81.0 million.

Cash and Cash Flow, Annual

(577)

(673)(665)

(660)

(638)

-700

-680

-660

-640

-620

-600

-580

-560

-540

-520

Au

g-0

7

Au

g-0

8

Au

g-0

9

Au

g-1

0

Au

g-1

1

($ m

m)

0

20

40

60

80

100

120

140

160

180

($ m

m)

Cash and Cash Flow, by Quarter

-800

-700

-600

-500

-400

-300

-200

-100

0

No

v-0

6

Fe

b-0

7

Ma

y-0

7

Au

g-0

7

No

v-0

7

Fe

b-0

8

Ma

y-0

8

Au

g-0

8

No

v-0

8

Fe

b-0

9

Ma

y-0

9

Au

g-0

9

No

v-0

9

Fe

b-1

0

Ma

y-1

0

Au

g-1

0

No

v-1

0

Fe

b-1

1

Ma

y-1

1

Au

g-1

1

($ m

m)

0

10

20

30

40

50

60

($ m

m)

Net Cash (LHS) Operating cash flow

Figure 44. Corus Cash and Cash Flow, by Quarter/Annual


Net Debt and Debt Ratios, by Quarter

-720

-700

-680

-660

-640

-620

-600

-580

-560

-540

No

v-0

7

Fe

b-0

8

Ma

y-0

8

Au

g-0

8

No

v-0

8

Fe

b-0

9

Ma

y-0

9

Au

g-0

9

No

v-0

9

Fe

b-1

0

Ma

y-1

0

Au

g-1

0

No

v-1

0

Fe

b-1

1

Ma

y-1

1

Au

g-1

1

($ m

m)

0%

50%

100%

150%

200%

250%

300%

Net debt Net Debt/Equity Net debt / Segment Profit (LTM)

Figure 45. Corus Net Debt and Debt Ratios, by Quarter/Annual



38

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

E S T I M A T E S U M M A R Y

We are estimating revenue (Figure 47) for F2009 of $787.7 million, flat with F2008. For F2010, we expect little overall growth, with

estimated revenue of $797.4 million. Consensus estimates are revenue of $794.0 million and $817.3 million, respectively. Our

estimates are tempered by expected continued weakness in the radio segment offsetting growth in TV. Due to the higher fixed-

cost component in the radio segment, we are estimating a drop in EBITDA to $244.3 million in F2009 (31.0% of revenue), improving

slightly to $248.9 million in F2010 (31.2% of revenue). Again we are below consensus of $253.3 million and $264.9 million,

respectively. We expect EPS of $1.51 in F2009, slightly above consensus of $1.49. Our cash flow per share estimates are $1.31 for

F2009, down from $1.78 in F2008, with a modest increase to $1.34 in F2010.

F2008A F2009E F2010E

(Year-End Aug 31, CAD$ millions) Actual Current Consensus Current Consensus

Radio 286.4 269.4 263.5

Television 501.8 518.3 533.9

Total Revenue (CAD$ mm) 787.2 787.7 794.0 797.4 817.3

Growth (%) 2.4 0.1 0.9 1.2 2.9

EBITDA (CAD $mm) 252.1 244.3 253.3 248.9 264.9

as % 32.0 31.0 31.9 31.2 32.4

EPS (CAD$) 1.44 1.51 1.49 1.47 1.56

Growth (%) 5.3 3.9 -2.9 4.5

Cash Flow 152.5 106.2 119.2 108.1 124.8

CFPS 1.78 1.31 1.49 1.34 1.56

RCC & Consensus Estimates

Figure 47. Corus Estimate Summary

Source. Company reports, Research Capital estimates, Capital IQ

C O R U S R A N K S 1 7 T H O V E R A L L B A S E D O N K E Y F I N A N C I A L M E T R I C S

Corus is the 18th largest public Media & Telecom company in Canada by revenue, based on the most recent quarterly results (Q4/

CY08). Its Y/Y growth rate of 0.2% ranked 30th overall. The company’s EBITDA margin of 31.7% ranked 10th. Corus has a negative net

cash position of $700.6 million, ranked 33rd overall. The company’s $129.6 million of operating cash flow ranks 13th. Overall, Corus

ranks 17th with a total score of 142 (Figure 46).

Overall

Rank Company Ticker Rev ($ mm) Rank

Rev

growth (%) Rank

EBITDA

(%) Rank

Net cash

($ mm) Rank

Op cash

flow ($ mm) Rank

Net

score






17 Corus Entertainment Inc. TSX:CJR.B 789.1 18 0.2 30 31.7 10 -700.6 33 129.6 13 142

Total 82,925.0 -54,643.9 21,945.3

Average 5.4 7.3


Figure 46. Financial Metric Ranking



39

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

C A T A L Y S T S

I M P R O V I N G A D V E R T I S I N G M A R K E T

An improvement in the general economic environment which spurred renewed spending in advertising would have a positive

effect on Corus’ financial results.

C H I L D R E N ’ S C O N T E N T

With the integration of the Content Group into Corus’ TV segment, Corus will continue to focus on developing or licensing new

content, especially for the children’s market. The strong recent success of Bakugan demonstrates the cross-platform impact to be

realized from new content.

N E W I N I T I A T I V E S

As a producer of content, and not just a distributor, management has recognized the need for Corus to explore new platforms for

its content. The company is investigating new initiatives including mobile and Internet. For example, Corus has already announced

the signing of an agreement to stream its radio stations through an iPhone application.

R I S K S

C O N T R O L B Y S H A W F A M I L Y

Corus is controlled by the Shaw family through their ownership of the majority of Corus’ Class A voting shares. The Class B shares

do not have voting rights. As such, the Shaw family may act in a way that is detrimental to the Class B shareholders.

R E G U L A T O R Y

Corus is regulated by the Canadian Radio-Television and Telecommunications Commission under the Broadcasting Act. The Act

controls and regulates broadcasting activity in Canada. As such, Corus’ licenses and ability to operate may be subject to change

based on regulatory changes in the Act. For example, the ongoing dispute regarding Part II fees means that the company has been

accruing expenses in its financial statements for the past few quarters.


40

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

V A L U A T I O N & R E C O M M E N D A T I O N

Corus has traded in a tight valuation range over the past five years (Figure 48), with EV/trailing revenue ranging between 2.35x to

3.25x. The overall average is 2.8x. Currently, Corus is trading at 2.5x.

Historical EV/Revenue2.5x

2.8x

0.0

0.51.0

1.5

2.0

2.53.0

3.5

4.0

7/3

0/2

00

4

11

/2/2

00

4

2/2

/20

05

5/2

/20

05

8/2

/20

05

11

/2/2

00

5

2/2

/20

06

5/2

/20

06

8/2

/20

06

11

/2/2

00

6

2/2

/20

07

5/2

/20

07

8/2

/20

07

11

/2/2

00

7

2/1

/20

08

5/2

/20

08

8/1

/20

08

10

/31

/20

08

2/2

/20

09

5/1

/20

09

(x)

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

(C$

)

EV/Revenue Average EV/Revenue Monthly Closing Price

Current

Average

Figure 48. Corus EV/Revenue (trailing)

Source. Capital IQ

Historical EV/EBITDA

7.9x

8.5x

0

2

4

6

8

10

12

14

7/3

0/2

00

4

10

/1/2

00

4

12

/2/2

00

4

2/2

/20

05

4/1

/20

05

6/2

/20

05

8/2

/20

05

9/3

0/2

00

5

12

/2/2

00

5

2/2

/20

06

3/3

1/2

00

6

6/2

/20

06

8/2

/20

06

10

/2/2

00

6

12

/1/2

00

6

2/2

/20

07

4/2

/20

07

6/1

/20

07

8/2

/20

07

10

/2/2

00

7

11

/30

/20

07

2/1

/20

08

4/2

/20

08

6/2

/20

08

8/1

/20

08

10

/2/2

00

8

12

/2/2

00

8

2/2

/20

09

4/2

/20

09

6/2

/20

09

(x)

0.00

5.00

10.00

15.00

20.00

25.00

30.00

(C$

)

EV/EBITDA Average EV/EBITDA Monthly Closing Price

Current

Average

Figure 49. Corus EV/EBITDA (trailing)

Source. Capital IQ

On an EV/EBITDA basis (Figure 49), Corus has traded at an average of 8.5x TTM EBITDA with a high of 11.9x and a recent low of 6.8x.

Currently, Corus is trading at 7.9x, in the lower end of its historical range.


41

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

When compared to the Broadcasting comp group (Figure 50), Corus has traded inline with the group median EV/EBITDA multiple

since the beginning of 2007.

Historical EV/EBITDA (TTM)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

7/2

/20

04

9/3

/20

04

11

/4/2

00

4

1/4

/20

05

3/4

/20

05

5/4

/20

05

7/4

/20

05

9/2

/20

05

11

/4/2

00

5

1/4

/20

06

3/3

/20

06

5/4

/20

06

7/4

/20

06

9/1

/20

06

11

/3/2

00

6

1/4

/20

07

3/2

/20

07

5/4

/20

07

7/4

/20

07

9/4

/20

07

11

/2/2

00

7

1/4

/20

08

3/4

/20

08

5/2

/20

08

7/4

/20

08

9/4

/20

08

11

/4/2

00

8

1/2

/20

09

3/4

/20

09

5/4

/20

09

BROADCASTING MEDIAN TSX:CJR.B BROADCASTING MEDIAN Avg TSX:CJR.B Avg

Figure 50. Relative EV/EBITDA Valuation

Source. Capital IQ

N A V D R I V E S $ 1 5 . 2 5 T A R G E T P R I C E

Our 12-month target price for Corus is based on a net asset value (Figure 51). We value the TV assets at 9.0x EBITDA (slightly below

the average historical EV/EBITDA multiple for broadcasting companies), the radio assets at 5.0x (a lower multiple due to the

challenges in the radio market), and the corporate assets at 6.0x. The FTM combined value of the assets is $26.24. Netting off $8.28

per share in debt and applying a 15% public company discount implies an FTM target price of $15.27.

Current Value FTM EBITDA ($mm) Multiple Value ($mm) Per Share

TV 201.8 9.0x 1,815.8 $22.69

Radio 61.2 5.0x 306.2 $3.83

Corporate -20.3 6.0x -121.8 -$1.52

Total 242.7 8.2x 2,000.2 $24.99

Net Debt -666.0 -$8.32

Enterprise Value 1,334.2 $16.67

Public Company Discount -15%

Shares O/S 80.0

Current Implied Value $14.17

FTM Value FTM+1 EBITDA ($mm) Multiple Value ($mm) Per Share

TV 210.4 9.0x 1,893.8 $23.66

Radio 65.5 5.0x 327.6 $4.09

Corporate -20.2 6.0x -121.1 -$1.51

Total 255.8 8.2x 2,100.3 $26.24

Net Debt -662.3 -$8.28


Public Company Ddiscount -15%

Shares O/S 80.0

FTM Implied Value $15.27

Net Asset Valuation

Figure 51. Corus Net Asset Valuation

Source. Capital IQ


42

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

Therefore, we are establishing a $15.25 FTM target price for TSX:CJR.B. Our target price implies 7.4x EV/EBITDA, and 10.1x P/E based

on our FTM+1 (Feb/2011) estimates. Corus’ U.S. comp group (Figure 52) trades at median multiples of 9.4x EV/EBITDA (CY) and 16.1x

P/E (CY), while the Canadian group (Figure 53) trades at 8.1x EV/EBITDA (CY) and 10.4x P/E (CY).

Trading Multiples

Company Name

USD

Market

Cap

($ mm)

USD

Enterprise

Value

($ mm)

Dividend

Yield

CFFO

Yield

CFFO

Yield

(EV) P/ CFFO

EV/

CFFO

FCF

Yield P/ FCF

TEV /LTM

EBITDA

TEV/ NTM

EBITDA

TEV/

EBITDA CY

TEV/

EBITDA

CY+1

P/ LTM

EPS

P/ NTM

EPS

P/E

CY

P/E

CY+1

Belo Corp. (NYSE:BLC) 191.7 1,265.1 NM 77.0% 11.7% 1.3x 8.6x 43.8% 2.3x 5.6x NM 7.9x 6.7x NM NM 5.8x 3.7x

CBS Corporation (NYSE:CBS) 6,061.0 12,952.6 2.2% 18.1% 8.5% 5.5x 11.8x 9.1% 11.0x 5.7x 6.9x 7.2x 6.7x NM 14.1x 17.2x 11.6x

Central European Media Enterprises Ltd.

(NasdaqGS:CETV) 1,334.1 2,246.9 NM 5.2% 3.1% 19.2x 32.3x 24.3% 4.1x 8.8x 11.8x 12.2x 10.9x NM 17.8x 18.7x 15.4x

Crown Media Holdings Inc. (NasdaqGM:CRWN) 209.6 1,307.9 NM 22.6% 3.6% 4.4x 27.6x 61.3% 1.6x 6.3x NM NM NM NM NM NM NM

Cumulus Media Inc. (NasdaqGS:CMLS) 52.1 689.5 NM 139.2% 10.5% 0.7x 9.5x 80.0% 1.3x 8.7x NM 10.0x NM NM NM 8.3x NM

Discovery Communications, Inc. (NasdaqGS:DISC.A) 6,266.5 9,873.5 NM 10.2% 6.5% 9.8x 15.4x 5.4% 18.4x 7.1x 7.4x 7.6x 6.9x 22.2x 17.0x 17.8x 14.9x

Emmis Communications Corp. (NasdaqGS:EMMS) 12.9 579.1 NM 360.0% 8.0% 0.3x 12.4x 138.0% 0.7x 9.8x 14.5x 13.0x 14.5x NM NM 0.6x NM

Entercom Communications Corp. (NYSE:ETM) 67.0 874.6 NM 191.7% 14.7% 0.5x 6.8x 138.9% 0.7x 7.1x 9.1x 9.3x 8.3x NM 2.4x 2.5x 2.1x

Gray Television Inc. (NYSE:GTN) 34.0 910.0 NM 193.1% 7.2% 0.5x 13.8x 147.3% 0.7x 8.4x 12.0x 13.7x 7.1x NM NM NM NM

Grupo Televisa SA (NYSE:TV) 9,581.2 11,876.3 NM 15.5% 12.5% 6.4x 8.0x 2.9% 34.8x 8.4x 7.8x 8.1x 7.2x 17.5x 14.9x 17.1x 14.2x

Hearst-Argyle Television Inc. (NYSE:HTV) 424.1 1,219.9 NM 34.8% 12.1% 2.9x 8.3x 38.3% 2.6x 6.8x 9.1x 9.4x 6.6x NM 35.4x NM 8.5x

LIN TV Corp. (NYSE:TVL) 103.3 777.5 NM 62.8% 8.3% 1.6x 12.0x 75.4% 1.3x 7.1x NM 11.1x NM NM NM 16.1x 4.1x

Nexstar Broadcasting Group Inc. (NasdaqGM:NXST) 25.0 665.0 NM 186.8% 7.0% 0.5x 14.2x 82.5% 1.2x 7.8x NM 7.9x 7.0x NM NM 2.9x 1.9x

Radio One Inc. (NasdaqGM:ROIA.K) 21.8 681.6 NM 102.6% 3.3% 1.0x 30.4x 109.7% 0.9x 8.3x NM NM NM NM NM NM NM

Sinclair Broadcast Group Inc. (NasdaqGS:SBGI) 166.3 1,498.1 NM 112.4% 12.5% 0.9x 8.0x 115.6% 0.9x 7.1x 9.1x 9.4x 8.1x NM 12.8x 24.0x 14.4x

BROADCASTING MEDIAN 166.3 1,219.9 2.2% 77.0% 8.3% 1.3x 12.0x 75.4% 1.3x 7.1x 9.1x 9.4x 7.1x 19.8x 14.9x 16.1x 10.1x

PUBLISHING MEDIAN 985.5 2,048.4 2.9% 15.8% 9.7% 6.3x 10.3x 13.1% 7.6x 7.1x 7.2x 7.5x 6.7x 16.5x 13.9x 14.1x 13.1x

TELECOM MEDIAN 3,800.0 8,970.8 1.9% 27.9% 12.6% 3.6x 7.8x 11.7% 8.5x 6.4x 5.6x 5.9x 5.3x 15.4x 17.8x 16.5x 12.1x

MOVIES & ENTERTAINMENT MEDIAN 1,587.3 2,454.4 4.5% 12.6% 10.1% 8.0x 9.9x 14.5% 6.9x 7.3x 7.1x 7.4x 6.7x 14.2x 14.5x 15.3x 13.0x

ADVERTISING MEDIAN 998.4 934.8 2.6% 20.7% 13.2% 4.8x 7.6x 11.7% 8.6x 6.8x 6.8x 6.8x 6.4x 14.6x 16.7x 16.7x 16.7x

High 46,678.7 72,113.4 10.7% 451.9% 25.2% 27.2x 35.7x 540.3% 39.0x 62.9x 52.1x 52.1x 37.3x 94.8x 68.2x 81.2x 51.6x

Low 12.9 128.0 1.0% 3.7% 1.3% 0.2x 4.0x 1.9% 0.2x 3.1x 3.9x 3.7x 3.8x 2.1x 2.4x 0.6x 1.9x

Median 1,114.4 2,048.4 2.4% 22.6% 10.5% 4.4x 9.5x 14.5% 6.9x 7.1x 7.1x 7.5x 6.7x 15.9x 14.9x 15.2x 12.9x

EBITDA EPS

U.S. Media > Comparable Company Analysis

Figure 52. U.S. Comparables Valuation

Source. Capital IQ

Trading Multiples

Company Name

CAD

Market

Cap

($m)

CAD

Enterprise

Value ($m)

Dividend

Yield

CFFO

Yield

CFFO

Yield

(EV)

P/

CFFO

EV/

CFFO

FCF

Yield P/FCF

TEV/

LTM

EBITDA

TEV/

NTM

EBITDA

TEV/

EBITDA

CY

TEV/

EBITDA

CY+1

P/LTM

EPS

P/NTM

EPS

P/E

CY

P/E

CY+1

Asian Television Network International Ltd. (TSXV:SAT) 10.2 9.6 NM 14.3% 15.2% 7.0x 6.6x 10.5% 9.5x 4.2x NM NM NM 17.0x NM NM NM

Astral Media Inc. (TSX:ACM.A) 1,668.8 2,419.5 1.7% 12.0% 8.3% 8.3x 12.0x 7.9% 12.6x 7.9x NM 8.3x 7.7x 10.9x 10.4x 10.7x 9.8x

CanWest Global Communications Corp. (TSX:CGS) 40.9 4,139.7 NM 138.6% 1.4% 0.7x NM 465.5% 0.2x 7.7x 7.9x 8.1x 7.5x NM NM NM NM

Corus Entertainment Inc. (TSX:CJR.B) 1,185.3 1,869.1 4.1% 11.4% 7.2% 8.8x 13.9x 28.1% 3.6x 7.4x 7.5x 7.5x 7.0x 9.8x 9.7x 10.0x 9.3x

Newfoundland Capital Corp. Ltd. (TSX:NCC.A) 219.8 288.0 1.5% 8.8% 6.7% 11.4x 14.9x 0.1% NM 31.2x 13.8x 13.8x 13.2x NM 30.3x 30.3x 26.4x

Score Media Inc. (TSX:SCR) 41.4 46.8 NM 15.5% 13.7% 6.5x 7.3x NM NM 9.5x NM NM NM 47.5x NM NM NM

TVA GROUP Inc. (TSX:TVA.B) 215.7 327.7 2.2% 20.2% 13.3% 5.0x 7.5x 9.3% 10.8x 4.9x 5.3x 4.7x 4.7x 4.8x 5.9x 5.7x 5.6x

BROADCASTING MEDIAN 215.7 327.7 2.0% 14.3% 8.3% 7.0x 9.8x 9.9% 9.5x 7.7x 7.7x 8.1x 7.5x 10.9x 10.0x 10.4x 9.6x

PUBLISHING MEDIAN 121.9 219.6 3.9% 30.7% 12.4% 3.3x 8.1x 27.4% 3.6x 6.2x 6.3x 6.4x 6.4x 7.2x 6.3x 6.3x 5.7x


MOVIES & ENTERTAINMENT MEDIAN 35.9 48.1 12.3% 56.5% 21.3% 1.7x 4.1x 58.5% 1.7x 6.1x 8.2x 8.1x 5.1x NM 12.1x 5.9x 14.5x



Low 0.3 -44.2 1.1% 0.7% 0.8% 0.7x 1.0x 0.1% 0.2x 1.5x 2.2x 2.3x 2.5x 3.7x 2.1x 2.1x 1.7x

Median 79.0 149.6 4.3% 26.9% 13.6% 3.7x 7.0x 23.0% 4.3x 5.8x 6.2x 6.4x 5.3x 10.3x 10.0x 9.6x 9.7x

EBITDA EPS

Canadian Media > Comparable Company Analysis

Figure 53. Canadian Comparables Valuation

Source. Capital IQ


43

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

S T R O N G R E L A T I V E P R I C E P E R F O R M A N C E

On a relative price performance basis, CJR.B has outperformed both the U.S. and the Canadian Broadcasting groups (Figure 54).

Broadcasting

0

20

40

60

80

100

120

4-J

un

-08

17

-Ju

n-0

8

30

-Ju

n-0

8

11

-Ju

l-0

8

24

-Ju

l-0

8

6-A

ug

-08

19

-Au

g-0

8

1-S

ep

-08

12

-Se

p-0

8

25

-Se

p-0

8

8-O

ct-

08

21

-Oc

t-0

8

3-N

ov

-08

14

-No

v-0

8

27

-No

v-0

8

10

-De

c-0

8

23

-De

c-0

8

7-J

an

-09

20

-Ja

n-0

9

2-F

eb

-09

13

-Fe

b-0

9

26

-Fe

b-0

9

11

-Ma

r-0

9

24

-Ma

r-0

9

6-A

pr-

09

20

-Ap

r-0

9

1-M

ay

-09

14

-Ma

y-0

9

27

-Ma

y-0

9

Index: US Broadcasting (Market Cap Weights)

Index: Cdn Broadcasting (Market Cap Weights)

TSX:CJR.B

Figure 54. CJR.B Relative Price Performance

Source. Capital IQ

C O N C L U S I O N R A D I O D R A G S D O W N V A L U E

With continued challenges in the company’s radio segment offsetting gains in TV, we expect Corus’ shares to remain under pressure

in the near term. With the stock trading very close to our $15.25 target price, we are initiating coverage of Corus with a HOLD

recommendation. Note that the current dividend yield of 3.7% will provide some support to the stock at these levels.


44

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

C O R P O R A T E P R O F I L E & F I N A N C I A L S U M M A R Y

CORUS ENTERTAINMENT INC. (TSX:CJR.B)

COMPANY INFORMATION

Corus Entertainment, Inc., a media and entertainment company, engages in radio and television broadcasting business in Canada. The company operates 53 radio stations, various specialty television

networks focused on children and adult genres, and 3 broadcast television stations. It also produces and distributes children’s programming and merchandise products; offers cable advertising and

digital audio services; and publishes children’s books in English. The company was founded in 1998 and is based in Toronto, Canada.

Stock Exchange TSX Latest Fiscal Year 8/31/2008 Primary Industry Broadcasting

Website http://www.corusent.com Latest Fiscal Quarter 2/28/2009

Employees 1,972 LTM as of 2/28/2009

VALUATION PRICE/VOLUME GRAPH

(in millions, except per share data)

Valuation Market Data

Current Price (6/04/09) 14.81 Dividend Yield 3.9%

52 Week High (9/19/08) 20.30 Beta 0.69

52 Week Low (12/15/08) 10.69 Float % 89.5%

Total Basic Common Shares 80.0 Shares Sold Short NA

Market Capitalization 1,185.3 Days Cover Short NA

Plus: Total Debt 705.4

Plus: Preferred Stock 0.0 Average Trading Volume

Plus: Minority Interest 17.8 Last Week 0.2

Less: Cash and ST Investments (39.4) Last 3 Months 0.2

Enterprise Value 1,869.1 Last 6 Months 0.2

Relative Performance Last Year 0.2

TSX:CJR.B YTD 6.0%

S&P 500 YTD 4.3%998 999 1000 2000

CAPITAL STRUCTURE FINANCIAL SUMMARY

Capital Structure Fiscal Year Ending, LTM Fiscal Year Ending,

Commercial Paper 0.0 Unamortized Premium 0.0 8/31/2006 8/31/2007 8/31/2008 2/28/2009 2009E 2010E

Revolving Credit 200.0 Unamortized Discount 0.0

Term Loans 500.0 Adjustments (7.3)

Snr Bonds and Notes 0.0 Total Debt 692.8 Revenue 726.3 768.7 787.2 791.7 787.7 797.4

Sub Bonds and Notes 0.0 EBITDA 214.1 240.9 252.1 251.4 244.3 248.9

Trust Preferred 0.0 Undrawn Revolver 100.0 Margin (%) 29.5% 31.3% 32.0% 31.7% 31.0% 31.2%

Capital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT 189.9 217.8 230.1 230.4 NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) 26.2% 28.3% 29.2% 29.1% NA NA

Total Principal Due 700.0 Other Available Credit 0.0 Net Income 35.5 107.0 129.8 124.7 121.1 117.6

Total Undrawn Credit 100.0 Margin (%) 4.9% 13.9% 16.5% 15.8% 15.4% 14.8%

998 999 1000 2000 Diluted EPS 0.41 1.23 1.54 1.52 1.51 1.47

VALUATION MULTIPLES

Fiscal Year Ending, LTM Fiscal Year Ending,

8/31/2006 8/31/2007 8/31/2008 2/28/2009 2009E 2010E Cash from Operations 111.0 103.1 130.6 134.5

TEV / Revenue 3.1x 3.5x 2.8x 2.4x 2.4x 2.3x Cash from Investing (17.2) (70.8) (101.5) (90.5)

TEV / EBITDA 6.7x 11.4x 8.9x 7.6x 7.7x 7.5x Cash from Finaning (188.2) (42.6) (42.8) (37.0)

TEV / EBIT 11.8x 12.6x 9.8x 8.3x NA NA Change in Cash (94.5) (10.3) (13.7) 7.0

P / E NM 16.1x 12.5x 10.0x 9.8x 10.1x

P / BV 1.8x 2.1x 1.6x 1.2x 1.2x 1.1x Balance Sheet Latest

1 Year Growth Total Assets 1,842.2 1,937.0 2,033.7 2,091.4

Total Revenue (%) 6.3% 5.8% 2.4% 1.7% 0.1% 1.2% Total Liabilities 924.7 961.1 1,056.6 1,091.9

EBITDA 9.6% 12.5% 4.7% 1.8% (3.1%) 1.9% Total Equity 917.5 975.9 977.0 999.5

Net Income (50.1%) 201.7% 21.3% (0.7%) (6.7%) (2.9%)

EPS (50.3%) 201.1% 24.4% 4.3% (1.5%) (2.9%)

VALUATION MULTIPLES CHART FINANCIAL SUMMARY CHART

KEY EXECUTIVES & BOARD MEMBERS OWNERSHIP

Key Execs Title Top 10 Institutional Holders MM Shares % Held

Shaw, Heather Jarislowsky, Fraser Limited 7.3 9.09%

Pyramis Global Advisors, Llc 6.3 7.83%

Cassaday, John Burgundy Asset Management Ltd. 5.9 7.34%

Phillips, Hager & North Investment Management Ltd. 3.0 3.72%

Peddie, Thomas Connor, Clark & Lunn Investment Management Ltd. 2.8 3.50%

Mackenzie Financial Corporation 2.8 3.45%

Robertson, Paul Natcan Investment Management Inc. 2.0 2.49%

Gwl Investment Management Ltd. 1.5 1.93%

Selected Board Members Title Goodman & Company, Investment Counsel Ltd. 1.4 1.75%

Shaw, Heather Td Asset Management, Inc. 1.4 1.69%

Cassaday, John Shaw, J. 2.9 3.63%

Erker, Dennis Total Shares Outstanding 80.0 100.00%

Royer, Terrance

Rogers, Ronald

Leaney, Wendy

Income Statement

Cash Flow Statement

Executive Chairman, Chairman of Executive Committee, Ex-Officio Member of

Audit Committee, Ex-Officio Member of Corporate Governance Committee and

Ex-Officio Member of Human Resources Committee

Chief Executive Officer, President, Director, Member of Executive Committee, Ex-

Officio Member of Audit Committee, Ex-Officio Member of Corporate

Governance Committee and Ex-Officio Member of Human Resources

Committee

Chief Financial Officer and Senior Vice President

President of Corus Television

Executive Chairman, Chairman of Executive Committee, Ex-Officio Member of

Audit Committee, Ex-Officio Member of Corporate Governance Committee and

Ex-Officio Member of Human Resources Committee

Chief Executive Officer, President, Director, Member of Executive Committee, Ex-

Officio Member of Audit Committee, Ex-Officio Member of Corporate

Governance Committee and Ex-Officio Member of Human Resources

Committee

Director, Chairman of Corporate Governance Committee, Member of Executive

Committee and Member of Human Resources Committee

Lead Director, Chairman of Human Resources Committee and Member of

Executive Committee

Independent Director, Chairman of Audit Committee and Member of Executive

Committee

Independent Director and Member of Audit Committee

Valuation

$0

$50

$100

$150

$200

$250

$300

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

(in

$ m

illio

ns)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

EBITDA TEV / EBITDA

YOY Growth

10%

13%

5%

0%

5%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

EBITDA

Corus Entertainment Inc. (TSX:CJR.B) Price & Vol Chart

0.00

5.00

10.00

15.00

20.00

25.00

30.00

9/8

/20

06

10

/20

/20

06

12

/5/2

00

6

1/1

8/2

00

7

3/2

/20

07

4/1

6/2

00

7

5/3

0/2

00

7

7/1

3/2

00

7

8/2

4/2

00

7

10

/9/2

00

7

11

/22

/20

07

1/4

/20

08

2/1

5/2

00

8

4/2

/20

08

5/1

6/2

00

8

6/2

7/2

00

8

8/1

2/2

00

8

9/2

5/2

00

8

11

/7/2

00

8

12

/22

/20

08

2/4

/20

09

3/2

0/2

00

9

5/1

/20

09

($)

-

200

400

600

800

1,000

1,200

1,400

(00

0)

Daily Volume (000) Day Close Price

C Y B E R P L E X I N C .

45

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

CYBERPLEX INC. ( T S X : C X )

We are initiating coverage on Cyberplex Inc. with a BUY recommendation and $4.25 FTM target price.

F R O M C P M T O C P A

Cyberplex provides investors an opportunity to directly invest in the growth of the next evolution of marketing on the Internet – CPA

or cost per action. Initially, marketing on the Internet was based on CPM or the cost per thousand impressions, i.e. a $10.00 CPM meant

advertisers would pay the website $10.00 for every thousand times the ad was displayed on the website or just $0.01 per single

impression. This drove websites to try to increase their traffic as much as possible – in order to deliver the most page views or

impressions, thus optimizing revenue. In order to properly calculate the ROI of a CPM-based ad campaign, the advertiser must also

consider the click-through rate (CTR). If the CTR rate was 2% or 20 clicks per thousand, a campaign sold at a $10.00 CPM would

effectively cost $0.50 per click ($10 CPM/20 clicks). This allows the advertiser to better calculate the ROI of their campaign. However,

despite significant growth in website traffic, CTRs have fallen to well below 1% for banner display ads. Note that CTRs for search ads

tend to be higher and the resulting CPMs are higher – this is where Google dominates and makes the vast majority of its money.

The newest model to evolve is CPA or cost per action. Under this model, advertisers only pay for a specific pre-defined action.

Common examples include the customer registering their personal information by filling out a form or buying an item.

G R O W T H O F I N T E R N E T A D V E R T I S I N G

Internet advertising is expected to enjoy the strongest growth of any medium over the next few years, according to a new report

from ZenithOptimedia (Figure 55). Advertising on the Internet was estimated to rise by 20.9% in 2009 to US$50.0 billion from

US$41.3 billion in 2007, accounting for 10.4% of total advertising expenditures. This was a sharp increase from 8.7% of total

expenditures in 2007. For 2009, only Internet advertising is expected to rise from 2008 levels, by 8.6%. Internet advertising is forecast

to be almost 15% of total advertising expenditures by 2011, with a CAGR of 13.9% from 2007.

Global Advertising

Expenditure by Medium

$476,894 $481,220$448,740 $455,374

$475,797

0

100000

200000

300000

400000

500000

600000

2007 2008 2009 2010 2011

(US

$ m

m)

Television Newspapers Internet Magazines

Radio Outdoor Cinema

Global Advertising

Expenditure by Medium, Annual Growth

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011

Newspapers Magazines Television RadioCinema Outdoor Internet

Figure 55. Global Advertising Expenditure, By Medium & Global Advertising Expenditure, Annual Growth

Source. ZenithOptimedia, April 2009


46

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

A L E A D I N G P R O V I D E R O F C P A S O L U T I O N S

Cyberplex is a leading provider of performance-based Internet advertising solutions under the CPA model to its clients. The company

has developed a very large affiliate network of websites that seek to monetize their traffic. Cyberplex’s Digital Media platform gives

advertisers the ability to create, develop, and monitor web-based advertising campaigns in an easy-to-use manner.

The revenue model is simple – Cyberplex charges the advertiser a CPA rate for a campaign which it then shares with the affiliate

(e.g. the website) through which the campaign is distributed. The revenue split generally ranges from 65%-70% to the affiliate.

Note that Cyberplex also continues to provide a range of technology services under its Technology Services division.

C O M P E T I T I V E A D V A N T A G E

Cyberplex’s primary competitors are ValueClick Inc. (NasdaqGS:VCLK) through its Commision Junction division, Hydra Media

(private), AzoogleAds Inc. (private), and Copeac, a division of InterMark Media (private). ValueClick acquired Commision Junction in

December 2003 for $96 million.

D A T A I N T E L L I G E N C E

Cyberplex analyzes, on an ongoing basis, the effectiveness of the advertising campaigns across its affiliate network. The company

examines customer conversion behaviour and this, combined with data from both the affiliate network and the advertisers, gives

Cyberplex the ability to create the most efficient distribution for its advertisers' campaigns.

N E T W O R K O F A F F I L I A T E S

Cyberplex has developed a very large, proprietary network of affiliate websites through which it distributes the advertising

campaigns. With its growing network, Cyberplex can offer extremely targeted, i.e. high value, campaigns to advertisers.

P R O P R I E T A R Y T E C H N O L O G Y P L A T F O R M

Cyberplex’s technology platform has been developed to provide a system for advertisers to create campaigns and distribute them

to a targeted audience across specific distribution channels. The platform also allows the advertisers to track, report, and analyze

the performance of a specific campaign in real-time. This gives the advertiser the ability to change a campaign on the fly, versus an

offline traditional campaign that wouldn’t show results for weeks or even months and couldn’t be easily changed during the

campaign.

I N T E R N A L D I S T R I B U T I O N

Cyberplex also acts as its own distribution system, thereby reducing the revenue it must share with affiliates. This also provides the

company with better intelligence as to what types of campaigns work in the most effective manner in order to provide the best

information to both the advertisers and affiliates.


47

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

T W O P R O N G E D G R O W T H S T R A T E G Y

The growth strategy for Cyberplex has two primary aspects – increasing the number of affiliates in Cyberplex’s network and

increasing the number of campaigns it drives out to its affiliate network. Cyberplex brings together advertisers who want to launch

online marketing campaigns with affiliates who want to monetize their web properties (and other forms of distribution). The

unique value proposition to the advertiser is that the advertiser is only charged when an Internet user completes a specific action

(as defined by the advertiser). With a large and growing affiliate network in place, the value to the advertiser increases with the scale

of the affiliate network. This in turn helps bring on additional affiliates who want to participate in the advertising campaigns.

I M P R E S S I V E F I N A N C I A L S T R E N G T H

S T R O N G G R O W T H I N W E B A D V E R T I S I N G S E G M E N T R E V E N U E …

After Cyberplex reported a blow-out Q4, with revenue increasing 430% Y/Y to $28.9 million, which was more than the revenue

generated in total in the first three quarters of 2008 (Figure 56), the company recently reported an even stronger Q1/09. Revenue

in Q1 rose 307% to $32.1 million. The strong growth was all generated in the company’s Web Advertising segment. While we don’t

expect the same level of growth on a percentage basis going forward, we do expect Cyberplex to grow at faster-than-market rates.

The overall Internet advertising market is expected to grow at roughly 10% over the next 3-5 years. CPA growth should exceed that

significantly as advertisers move to CPA from CPM campaigns. Based on Cyberplex’s leading position in the market, we are

comfortable modeling roughly 15% long-term annual revenue growth overall for Cyberplex. Our model estimates revenue of

$106.7 million in 2009 (growth of 86.3% based on low comp levels for the first three quarters of 2008), $127.5 million in 2010, and

$146.3 million in 2011 (Figure 56).


0

5

10

15

20

25

30

35

40

45

Ma

r-0

7

Jun

-07

Se

p-0

7

De

c-0

7

Ma

r-0

8

Jun

-08

Se

p-0

8

De

c-0

8

Ma

r-0

9

Jun

-09

Se

p-0

9

De

c-0

9

Ma

r-1

0

Jun

-10

Se

p-1

0

De

c-1

0

($m

m)

0%

50%

100%

150%

200%

250%

300%

350%

400%

450%

500%

(%)


0

20

40

60

80

100

120

140

160

De

c-0

7

F2

00

7A

De

c-0

8

F2

00

8A

De

c-0

9

F2

00

9E

De

c-1

0

F2

01

0E

De

c-1

1

F2

01

1E

($m

m)

0%

50%

100%

150%

200%

250%

(%)

Web Advertising (LHS) Technology Services (LHS) Total revenues - yoy growth (RHS)

Figure 56. Cyberplex Segmented Revenue, by Quarter/Annual



48

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

… D R I V E S I N C R E A S E D P R O F I T A B I L I T Y …

With the jump in revenue, Cyberplex’s operating margins also increased significantly. EBITDA margin increased to 12.1% in Q1 from

2.4% in the prior year (Figure 57). Cyberplex’s financial model is relatively simple and highly leverageable. Gross margins will be

between 29% and 34% based on its revenue share agreements for its Web Advertising segment. General & Admin expenses will

decrease as a percentage of revenue and increase slowly in absolute terms. Sales & Marketing expenses will also decrease as a

percentage of revenue, but at a slower rate. Overall, we expect EBITDA margins of 11.5% overall for 2009, 13.3% in 2010, and 14.3%

in 2011. With $5.9 million of tax loss carry-forwards and limited depreciation and amortization expenses, most of the EBITDA drops

to the bottom line. Cyberplex reported $5.8 million of net income in 2008 or $0.10 per share. We are estimating $9.9 million of net

income in 2009 ($0.16 per share), increasing to $11.9 million in 2010 ($0.18 per share) (Figure 57). Note that we are assuming

Cyberplex accrues taxes starting in Q2/08.


(0.03)

0.10

0.160.18

0.23

0.160.18

(2.0)

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

De

c-0

7

F2

00

7A

De

c-0

8

F2

00

8A

De

c-0

9

F2

00

9E

De

c-1

0

F2

01

0E

De

c-1

1

F2

01

1E

($ m

m)

(0.05)

0.00

0.05

0.10

0.15

0.20

0.25

($)

Net income for the period Reported EPS (Diluted)

Consensus

EBITDA Margin, by Quarter

0

5

10

15

20

25

30

35

40

45

Ma

r-0

7

Jun

-07

Se

p-0

7

De

c-0

7

Ma

r-0

8

Jun

-08

Se

p-0

8

De

c-0

8

Ma

r-0

9

Jun

-09

Se

p-0

9

De

c-0

9

Ma

r-1

0

Jun

-10

Se

p-1

0

De

c-1

0

($ m

m)

-10%

-5%

0%

5%

10%

15%

20%

(%)

Technology Services revenue (LHS)Web Advertising revenue (LHS)EBITDA margin (RHS)

Figure 57. Cyberplex EBITDA, Net Income, and EPS, by Quarter/Annual


… A N D S I G N I F I C A N T C A S H F L O W

As Figure 58 shows, with the increased profitability, Cyberplex has begun generating significant operating cash flow. Operating cash

flow was $4.2 million in Q4/08 and $4.2 million in Q1/09, by far the highest levels in the last two years. We expect Cyberplex to

generate $10.0 million of operating cash flow in 2009 and $12.3 million in 2010. Note that the company strengthened its balance

sheet recently with a $15 million bought deal financing whereby the company issued 9.4 million shares at $1.60 per share.


0.7 0.6 0.8 0.4 0.9 0.8 1.1

5.0 5.5

20.021.4

19.822.4

29.531.5

29.3

0

5

10

15

20

25

30

35

Ma

r-0

7

Jun

-07

Se

p-0

7

De

c-0

7

Ma

r-0

8

Jun

-08

Se

p-0

8

De

c-0

8

Ma

r-0

9

Jun

-09

Se

p-0

9

De

c-0

9

Ma

r-1

0

Jun

-10

Se

p-1

0

De

c-1

0

($ m

m)

-1

0

1

2

3

4

5

6

($ m

m)


Cash and Cash Flow, Annual

(0.4)

5.6

10.2

12.3

15.3

0

5

10

15

20

25

30

35

40

45

De

c-0

7

F2

00

7A

De

c-0

8

F2

00

8A

De

c-0

9

F2

00

9E

De

c-1

0

F2

01

0E

De

c-1

1

F2

01

1E

($ m

m)

-2

02

46

8

1012

1416

18

($ m

m)


Figure 58. Cyberplex Cash and Cash Flow, by Quarter/Annual



49

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

C Y B E R P L E X R A N K S 2 4 T H O V E R A L L B A S E D O N K E Y F I N A N C I A L M E T R I C S

Cyberplex is the 33rd largest public Media & Telecom company in Canada by revenue, based on the most recent quarterly results

(Q4/CY08). Its Y/Y growth rate of 69.2% ranked second overall. The company’s EBITDA margin of 8.3% ranked 32nd. Cyberplex has

a net cash position of $1.8 million, ranked fifth overall. The company’s -$1.4 million of operating cash flow ranks 40th. Overall,

Cyberplex ranks 24th with a total score of 133 (Figure 59).

Overall

Rank Company Ticker

Rev

($ mm) Rank

Rev growth

(%) Rank

EBITDA

(%) Rank

Net cash

($ mm) Rank

Op cash

flow ($ mm) Rank

Net

score






24 Cyberplex Inc. TSX:CX 57.3 33 69.2 2 8.3 32 1.8 5 -1.4 40 133

Total 82,925.0 -54,643.9 21,945.3

Average 5.4 7.3





Our estimates are inline with the consensus view for F2009 as we expect strong revenue growth leading to higher operating

margins (Figure 60).

F2008A F2009E F2010E

(Year-End Dec 31, CAD$ millions) Actual Current Consensus Current Consensus

Technology Services 5.0 5.6 6.2

Web Advertising 52.2 101.1 121.3

Total Revenue 57.3 106.7 105.5 127.5 129.3

Growth (%) 224.5 86.3 84.1 19.5 22.6

EBITDA 4.9 12.2 11.9 16.9 15.2

as % 8.6 11.5 11.3 13.3 11.7

EPS 0.10 0.16 0.16 0.18 0.18

Growth (%) -481.6 56.5 58.5 12.6 10.4


Figure 60. Cyberplex Estimate Summary


C A T A L Y S T S

We see several potential valuation catalysts for Cyberplex’s stock. First, the stock reacted quite positively to the company’s excellent

Q4 financial performance. As we expect the company to continue to report strong financial results, the stock should continue to

react favourably as analysts revise their estimates higher. Second, winning of large Internet advertising campaigns would be a

positive development for Cyberplex. Finally, Cyberplex represents a potential takeover candidate as the Internet advertising sector

continues to consolidate.


50

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

R I S K S

U . S . D O L L A R E X P O S U R E

Cyberplex generates the majority of its revenue (95%) in U.S. dollars, while it reports in Canadian dollars. In addition, 70% of its

expenses are in Canadian dollars. Rapid moves in the Canadian dollar relative to the U.S. dollar could have a material impact on the

company’s reported financial results. Note that the company has hedging strategies in place to mitigate this risk.

C U S T O M E R C O N C E N T R A T I O N

Cyberplex generates a significant portion of its revenue from a relatively small group of customers. The largest five customers

accounted for 67% of revenue for the quarter ended March 31, 2009, with the top 10 accounting for 77% of revenue. Cancellation

by one of the company’s larger clients could have an adverse impact on Cyberplex’s results. Note that the company’s customer

retention rate of 75% (quarter/quarter) mitigates this risk.

R E D U C T I O N O F C P A R A T E S

Over 90% of Cyberplex’s revenue is generated from the Web Advertising division. As discussed previously, CPM rates (the price

charged per 1,000 impressions) have continued to drop significantly online (Figure 61), DESPITE the continued strong growth of

the Internet. Overall, CPMs have fallen by 50% from Q4/07 to Q4/08. A similar reduction in CPA rates would adversely impact the

company’s financial results.

Web CPMs

$0.50

$0.37$0.34

$0.27 $0.26

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

Q4/07 Q1/08 Q2/08 Q3/08 Q4/08

($)

Small Websites(1) Medium Websites (2) Large Websites (3) Total Websites (4)

Figure 61. Web CPMs

Source. PubMatic; January 14, 2009


51

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


Cyberplex has traded in a wide valuation range over the past five years, with EV/trailing revenue as high as 4.1x and as low as 0.4x.

Despite the recent very strong price performance of the stock (up ~250% from its low last year), Cyberplex is still trading at only

1.0x trailing revenue versus its average of 1.7x (Figure 62). Note that the company’s long-term historical EV/EBITDA and P/E

multiples are not meaningful due to prior periods of losses.

Historical EV/Revenue

1.0x

1.7x

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

8/4

/20

04

11

/4/2

00

4

2/4

/20

05

5/4

/20

05

8/4

/20

05

11

/4/2

00

5

2/3

/20

06

5/4

/20

06

8/4

/20

06

11

/3/2

00

6

2/2

/20

07

5/4

/20

07

8/1

/20

07

10

/31

/20

0

2/4

/20

08

5/2

/20

08

8/1

/20

08

11

/4/2

00

8

2/3

/20

09

5/4

/20

09

(x)

$0.00

$0.20

$0.40

$0.60

$0.80

$1.00

$1.20

$1.40

$1.60

$1.80

$2.00

($)


Average

Current

Figure 62. Cyberplex EV/Revenue (trailing)

Source. Capital IQ

Historical EV/Revenue (TTM)

0.0x

0.5x

1.0x

1.5x

2.0x

2.5x

3.0x

3.5x

4.0x

4.5x

6/3

/20

04

9/3

/20

04

12

/3/2

00

4

3/3

/20

05

6/3

/20

05

9/2

/20

05

12

/2/2

00

5

3/3

/20

06

6/2

/20

06

9/1

/20

06

12

/1/2

00

6

3/2

/20

07

6/1

/20

07

8/3

1/2

00

7

12

/3/2

00

7

3/3

/20

08

6/3

/20

08

9/3

/20

08

12

/3/2

00

8

3/3

/20

09

ADVERTISING MEDIAN TSX:CX ADVERTISING MEDIAN Avg TSX:CX Avg

Figure 63. Cyberplex EV/Revenue (trailing)

Source. Capital IQ

We also compared Cyberplex’s historical EV/Revenue multiple relative to the Advertising sub-group within our Media universe

(Figure 63). Cyberplex’s average EV/Revenue multiple of 1.7x over the past five years is higher than the group median of 1.1x over

that time. Cyberplex’s multiple has also been much more volatile, trading as high as 4.1x and as low as 0.4x, with a standard

deviation of 0.9x. The Advertising group traded between 0.3x and 1.2x, with a smaller standard deviation of 0.2x. With the recent

strong performance in Cyberplex’s stock, the multiple has again risen above the group median, but is still below Cyberplex’s

historical average.


52

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

D C F A N D E P S G R O W T H D R I V E $ 4 . 2 5 T A R G E T P R I C E

Our 12-month target price for Cyberplex is based on a discounted cash flow model and a long-term earnings growth model. Our

3-5 year growth assumptions are 15%-20% revenue growth and EBITDA margins of ~17%. Based on a range of discount rates (10%-

18%) and terminal multiples (8.0x-10.0x), our DCF model implies an FTM target price of $4.42. Using the same growth and

profitability parameters, long-term EPS growth is expected to be 22%-26%. Using a conservative PEG ratio of 0.8x, implies a P/E of

19.1x. Based on our FTM+1 (Mar/2011) EPS of $0.20, plus FTM cash per share of $0.38, implies a target price of $4.11. Therefore, we

are establishing a $4.25 FTM target price for TSX:CX. Our target price implies 1.8x TEV/Revenue, 13.4x EV/EBITDA, and 21.6x P/E

based on our FTM+1 (Mar/2011) estimates. Cyberplex’s U.S. comp group (Figure 64) trades at median multiples of 6.8x EV/EBITDA

(CY) and 16.7x P/E (CY), while the Canadian group (Figure 65) trades at 4.3x EV/EBITDA (CY) and 8.7x P/E (CY).

Trading Multiples

Company Name

USD

Market

Cap

($ mm)

USD

Enterprise

Value

($ mm)

Dividend

Yield

CFFO

Yield

CFFO

Yield

(EV)

P/

CFFO

EV/

CFFO

FCF

Yield P/FCF

TEV/

LTM

EBITDA

TEV/

NTM

EBITDA

TEV/

EBITDA

CY

TEV/

EBITDA

CY+1

P/LTM

EPS

P/NT

M EPS

P/E

CY

P/E

CY+1





AirMedia Group Inc. (NasdaqGM:AMCN) 425.5 279.7 NM NM NM NM NM NM NM 12.2x 38.7x NM 6.4x 20.4x NM NM 16.9x

Arbitron Inc. (NYSE:ARB) 545.5 619.2 1.9% 7.9% 6.9% 12.7x 14.4x NM NM 8.7x 6.8x 7.3x 6.0x 16.6x 12.6x 14.0x 10.8x

Clear Channel Outdoor Holdings Inc. (NYSE:CCO) 1,828.2 4,539.4 NM 32.7% 13.2% 3.1x 7.6x 25.6% 3.9x 6.8x 9.3x 9.3x 7.9x NM NM NM NM

Focus Media Holding Ltd. (NasdaqGS:FMCN) 1,111.1 970.8 NM NM NM NM NM NM NM 13.5x 5.6x 5.6x 7.6x NM 39.7x 39.7x 33.5x

Harte-Hanks Inc. (NYSE:HHS) 584.2 798.0 3.3% 19.3% 14.1% 5.2x 7.1x 14.6% 6.8x 5.6x 7.1x 7.1x 6.9x 10.4x 13.5x 13.8x 12.9x

Interpublic Group of Companies Inc. (NYSE:IPG) 2,583.3 3,868.5 NM 23.1% 15.4% 4.3x 6.5x 11.8% 8.5x 4.8x 5.6x 5.6x 5.4x 10.5x 15.2x 14.8x 12.1x

Lamar Advertising Co. (NasdaqGS:LAMR) 1,665.9 4,457.3 NM 20.8% 7.8% 4.8x 12.9x 10.0% 10.0x 9.2x 10.7x 10.8x 10.3x NM NM NM NM

MDC Partners Inc. (NasdaqGS:MDCA) 160.2 361.5 NM 42.7% 18.9% 2.3x 5.3x 31.5% 3.2x 6.8x 5.4x 5.6x 5.0x 14.6x 32.4x 43.9x 29.6x

National CineMedia, Inc. (NasdaqGS:NCMI) 582.1 934.8 4.6% 20.7% 12.9% 4.8x 7.8x 11.6% 8.7x 4.9x 4.9x 5.0x 4.5x 33.2x 21.2x 22.2x 18.7x

Omnicom Group Inc. (NYSE:OMC) 9,950.1 12,681.8 1.9% 16.8% 13.2% 5.9x 7.6x 10.2% 9.8x 6.7x 7.8x 7.8x 7.5x 10.5x 12.5x 12.4x 11.9x

ValueClick Inc. (NasdaqGS:VCLK) 998.4 893.9 NM 12.2% 13.6% 8.2x 7.3x 8.8% 11.3x 8.5x 6.5x 6.5x 6.1x NM 18.2x 18.6x 16.7x



Low 12.9 128.0 1.0% 3.7% 1.3% 0.2x 4.0x 1.9% 0.2x 3.1x 3.9x 3.7x 3.8x 2.1x 2.4x 0.6x 1.9x


EBITDA EPS



Source. Capital IQ

Trading Multiples

Company Name

CAD

Market

Cap ($m)

CAD

Enterprise

Value

($m)

Dividend

Yield

CFFO

Yield

CFFO

Yield

(EV)

P/

CFFO

EV/

CFFO

FCF

Yield P/FCF

TEV/

LTM

EBITDA

TEV/

NTM

EBITDA

TEV/

EBITDA

CY

TEV/

EBITDA

CY+1

P/LTM

EPS

P/NTM

EPS P/E CY

P/E

CY+1





BlueRush Media Group Corp. (TSXV:BTV) 1.6 1.1 NM 8.9% 13.6% 11.3x 7.4x NM NM 4.5x NM NM NM 15.2x NM NM NM

Cossette Communication Group Inc. (TSX:KOS) 45.0 51.2 NM 119.4% 105.0% 0.8x 1.0x 117.0% 0.9x 1.5x 2.2x 2.3x NM 8.1x 7.6x 7.8x NM

Cyberplex Inc. (TSX:CX) 84.2 79.5 NM 5.4% 5.7% 18.5x 17.4x 2.6% 38.0x 9.5x 6.3x 6.7x 5.2x 8.8x 9.4x 9.6x 8.7x

Empirical Inc. (TSXV:EM) 0.3 12.1 NM NM NM NM NM NM NM NM NM NM NM NM NM NM NM

Envoy Capital Group, Inc. (TSX:ECG) 13.7 -7.0 NM NM NM NM NM NM NM NM NM NM NM NM NM NM NM


Pareto Corp. (TSX:PTO) 28.3 31.0 9.1% 26.4% 24.1% 3.8x 4.1x 22.6% 4.4x 4.3x NM 3.6x 3.2x 7.9x NM 6.6x 5.5x



Low 0.3 -44.2 1.1% 0.7% 0.8% 0.7x 1.0x 0.1% 0.2x 1.5x 2.2x 2.3x 2.5x 3.7x 2.1x 2.1x 1.7x


EBITDA EPS



Source. Capital IQ


53

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

I M P R E S S I V E S T O C K P R I C E O U T P E R F O R M A N C E

Cyberplex’s stock has recovered very strongly (Figure 66), driven by the much better-than-expected Q4 financial results.

Advertising

0

50

100

150

200

250

4-J

un

-08

17

-Ju

n-0

8

30

-Ju

n-0

8

11

-Ju

l-0

8

24

-Ju

l-0

8

6-A

ug

-08

19

-Au

g-0

8

1-S

ep

-08

12

-Se

p-0

8

25

-Se

p-0

8

8-O

ct-

08

21

-Oc

t-0

8

3-N

ov

-08

14

-No

v-0

8

27

-No

v-0

8

10

-De

c-0

8

23

-De

c-0

8

7-J

an

-09

20

-Ja

n-0

9

2-F

eb

-09

13

-Fe

b-0

9

26

-Fe

b-0

9

11

-Ma

r-0

9

24

-Ma

r-0

9

6-A

pr-

09

20

-Ap

r-0

9

1-M

ay

-09

14

-Ma

y-0

9

27

-Ma

y-0

9

Index: US Advertising (Market Cap Weights) Index: Cdn Advertising (Market Cap Weights) TSX:CX

Figure 66. CX Relative Price Performance

Source. Capital IQ

C O N C L U S I O N

Despite the recent strong share price performance, we believe that the market is not yet fully pricing in the strong revenue and

profitability growth we expect for Cyberplex. Therefore, with significant upside to our $4.25 target price, we are initiating coverage

on Cyberplex Inc. with a BUY recommendation.


54

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


CYBERPLEX INC. (TSX:CX)

COMPANY INFORMATION

Cyberplex Inc. provides Web advertising solutions and on-line customer acquisition strategies for Fortune 1000 companies and small to mid-sized businesses in Canada and the United States. Its Web

Advertising division provides performance-based Internet advertising solutions to acquire leads, drive sign-ups, downloads, inquiries, or acquire paying customers. The company’s Technology

Services division comprises management and technology consultants to assist clients in the areas of applications lifecycle; and re-engineering and optimization of technologies, developing and

delivering applications using the productions and technologies, and monitoring and supporting applications to ensure performance and reliability. Cyberplex also provides technology solutions, such as

system integration, enterprise content management, data management and reporting, Web content management, business process management, enterprise search, and special engagement offerings; and Web

design solutions, which include pre-designed, custom designed, and ecommerce solutions. It serves advertisers, publishers, and agencies. The company was formerly known as NewPath Capital

Corporation and changed its name to Cyberplex Inc. in 1997. Cyberplex Inc. was founded in 1994 and is headquartered in Toronto, Canada with additional offices in San Diego, California; and Halifax, Canada.

Stock Exchange TSX Latest Fiscal Year 12/31/2008 Primary Industry Internet Software and Services

Website http://www.cyberplex.com Latest Fiscal Quarter 3/31/2009

Employees 40 LTM as of 3/31/2009




Current Price (6/04/09) 1.57 Dividend Yield NA

52 Week High (5/08/09) 1.99 Beta 1.63

52 Week Low (11/20/08) 0.27 Float % 67.4%


Market Capitalization 84.2 Days Cover Short NA





Enterprise Value 79.5 Last 6 Months 0.4


TSX:CX YTD 361.8%

S&P 500 YTD 4.3%998 999 1000 2000





Term Loans 0.0 Adjustments 0.0


Sub Bonds and Notes 0.0 EBITDA (0.5) (0.3) 4.8 8.4 12.2 16.9

Trust Preferred 0.0 Undrawn Revolver 2.1 Margin (%) (9.5%) (2.0%) 8.3% 10.3% 11.5% 13.3%

Capital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT (0.9) (1.0) 4.3 8.0 NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) (16.6%) (5.9%) 7.5% 9.8% NA NA

Total Principal Due 3.5 Other Available Credit 0.0 Net Income (1.3) (1.1) 5.8 9.9 8.6 9.7

Total Undrawn Credit 2.1 Margin (%) (24.2%) (6.5%) 10.1% 12.1% 8.1% 7.6%

998 999 1000 2000 Diluted EPS (0.03) (0.03) 0.11 0.18 0.16 0.18

VALUATION MULTIPLES


12/31/2006 12/31/2007 12/31/2008 3/31/2009 2009E 2010E Cash from Operations (1.0) (1.9) 0.5 4.6

TEV / Revenue 1.8x 2.0x 0.5x 1.0x 0.7x 0.6x Cash from Investing (2.0) 0.9 (4.2) (1.8)

TEV / EBITDA NM NM 24.8x 9.6x 6.5x 4.7x Cash from Finaning 3.1 0.9 7.5 1.0

TEV / EBIT NM NM 282.8x 10.1x NA NA Change in Cash 0.2 (0.2) 4.6 4.6

P / E NM NM 43.6x 8.9x 9.8x 8.7x


1 Year Growth Total Assets 10.5 12.2 35.0 37.0

Total Revenue (%) (26.4%) 231.0% 224.5% 262.2% 86.3% 19.5% Total Liabilities 2.3 4.3 15.4 13.1

EBITDA NM NM NM NM 155.9% 38.5% Total Equity 8.1 8.0 19.6 23.9

Net Income NM NM NM NM 49.6% 12.6%

EPS NM NM NM NM 47.4% 12.6%




Rotstein, Geoffrey Mosaic Venture Partners 4.7 8.68%

Osiel, Isaac

Alter, Rafael

Selected Board Members Title

Lobo, Vernon

Rotstein, Geoffrey Mcewen, Robert 10.5 19.58%

Executive Team 4.8 9.00%

Alter, Rafael Total Shares Outstanding 53.6 100.00%

Harris, Henry

Lavine, Marc

Tjan, Anthony

Income Statement

Cash Flow Statement

Chief Executive Officer, President and Director

Chief Financial Officer

Director and Chief Operating Officer of CX Digital Media

Chairman, Chairman of Compensation Committee and Member of Audit

Committee


Director and Chief Operating Officer of CX Digital Media

Director and Chairman of Corporate Governance Committee

Director, Chairman of Audit Committee and Member of Compensation

Committee

Director, Member of Audit Committee and Member of Corporate Governance

Committee

Cyberplex Inc. (TSX:CX) Price & Vol Chart

0.000.200.400.600.801.001.201.401.601.802.00

9/8

/20

06

10

/20

/20

06

12

/5/2

00

6

1/1

8/2

00

7

3/1

/20

07

4/1

6/2

00

7

5/2

8/2

00

7

7/1

3/2

00

7

8/2

3/2

00

7

10

/9/2

00

7

11

/22

/20

07

1/4

/20

08

2/1

5/2

00

8

4/1

/20

08

5/1

6/2

00

8

6/2

7/2

00

8

8/1

2/2

00

8

9/2

5/2

00

8

11

/7/2

00

8

12

/18

/20

08

2/3

/20

09

3/2

0/2

00

9

5/1

/20

09

($)

-5001,0001,5002,0002,5003,0003,5004,0004,500

(00

0)


Valuation

($5)

$0

$5

$10

$15

$20

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illio

ns)

0.0x

5.0x

10.0x

15.0x

20.0x

25.0x

30.0x

EBITDA TEV / EBITDA

YOY Growth

0% 0% 0%

156%

39%

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

120.0%

140.0%

160.0%

180.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Q U E B E C O R I N C .

55

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

QUEBECOR INC. ( T S X : Q B R . B )

We are initiating coverage on Quebecor Inc. with a BUY recommendation and $26.00 target price.

A D I V E R S I F I E D M E D I A & T E L E C O M L E A D E R

Quebecor Inc. is a holding company with an approximately 55% interest in Quebecor Media Inc. or QMI (Figure 67). QMI holds 100%

interest in a number of assets including Videotron, Sun Media, Osprey Media, Canoe (93.2%), nurun, Groupe Archambault, and a

51% interest in TVA (TSX:TVA.B).

Figure 67. Quebecor Corporate Structure



56

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

L E V E R A G I N G A B U N D L E D C A B L E O F F E R I N G

Videotron is a leading cable operator, which offers a “quadruple play” of services, including cable TV, Internet access, telephony, and

wireless. The company has over 1.7 million basic cable subscribers, of which almost 1.0 million are digital subscribers. Over 60% (1.1

million) of Videotron’s cable TV subscribers are also Internet subscribers, while almost 900,000 (51.5%) are telephony subscribers.

The company has had limited penetration in wireless with only 68,000 subscribers. Videotron’s cable TV subscriber base grew by

almost 5% in 2008, driven by a 20.7% increase in digital cable TV subscribers offsetting a 9.4% decrease in analog subscribers as

they shift to digital. Internet subscribers grew by 14.0% in 2008, while telephony grew by 33.9%. Videotron’s strong growth is

evidence of the strength of its quadruple play offering, with ARPU (average monthly revenue per user) growing from $67.37 in

Q1/07 to $85.08 in Q1/09. Growth in ARPU has accelerated post the introduction of the company’s telephony services.

Videotron competes with Bell for TV (through Express VU), Internet and wireline phone services and with Rogers, Bell, and Telus for

wireless services. Videotron is the largest cable operator in Quebec (based on subscribers) and the third largest in Canada. The

company competes several ways: (1) through the technical strength of its offering as Videotron offers the highest speed

(30MBS/50MBS) service, (2) through offering a complete bundle of services (the “quad play” of TV, telephony, wireless and Internet),

and (3) by providing strong customer service.

Videotron will continue to drive growth in several ways. First through converting analog subscribers to digital subscribers – this

allows the company to increase ARPU as it can deliver a broader (and higher-priced) suite of services to its digital customers.

Second, by continuing to focus on strong customer service. Third, by offering highly competitive bundled packages of services,

thereby increasing switching costs for customers.

In the wireless area, Videotron has not pushed its offering due to it currently operating under a MVNO model (using Rogers’

network) which has essentially made it unprofitable to acquire new customers. With its recent success in the wireless spectrum

auction (buying the entire spectrum available in Quebec), the company plans to aggressively rollout its own high-speed wireless

network. The company plans to spend $800 million to $1 billion on the startup of the network, including the $555 million spent

on the spectrum and initial expected operating losses.


57

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

N E W S P A P E R S E G M E N T U N D E R S I G N I F I C A N T P R E S S U R E

Quebecor’s Newspaper segment, which includes Sun Media, Osprey Media, and Canoe, is the largest (by circulation) newspaper

chain in Canada. The company publishes almost 40 paid-circulation dailies, over 200 community newspapers, magazines, etc.,

including six free dailies. Canoe is the company’s Internet portal which operates or owns a group of sites including e-commerce

sites focused on employment (jobboom.com), real estate (micasa.ca), automobiles (autonet.ca), dating (reseaucontact.com), social

networking (space.canoe.ca), and classifieds (classifieds.canoe.ca). QMI acquired Osprey in 2007, which drove revenue growth in

2008 when compared to 2007. However, excluding the impact of the acquisition, revenue declined in 2008, reflecting the dramatic

changes impacting the newspaper segment (as we outlined in the industry section to our report). Revenue at the company’s

portals did increase in 2008. With a high fixed operating cost base, operating income fell significantly in 2008. The newspaper

segment has also been subject to labour unrest, with lockouts and strikes impacting operations as well.

QMI employs a clustering strategy in the newspaper segment, hoping to achieve economies of scale on an operational basis while

also providing the opportunity for bundled advertising revenue. The company has also employed the use of free dailies in order to

drive advertising revenue. However, due to the industry issues we have outlined, the newspaper segment continues to face

significant pressure. Therefore, management is focused on cost control, such as through consolidating printing plants, in order to

limit the operating profit decreases in the newspaper segment.

B R O A D C A S T I N G ( T V A )

QMI owns 51% of TVA Group (TSX:TVA.B) on an economic basis (99% voting). TVA is the dominant French-language TV broadcaster,

with a 29% market share. TVA owns a number of television stations and both analog and digital channels. TVA also provides

teleshopping services and is the largest publisher of French-language magazines in Quebec. Subsidiary TVA Films distributes film

and television products in both the English and French-language markets. TVA’s primary competition in Quebec is Radio-Canada

(the CBC). As with many other broadcasters, TVA is enjoying growth in its specialty/digital television services, while experiencing a

drop in revenue from advertising in its publishing division.

O T H E R ( L E I S U R E & E N T E R T A I N M E N T , I N T E R A C T I V E T E C H N O L O G I E S )

QMI’s other segments include Leisure & Entertainment (retail sales of CDs, books, DVDs, etc., and book publishing) and Interactive

Technologies and Communications (nurun – develops web and intranet sites and provides other technology services).


58

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

F I N A N C I A L R E V I E W

C A B L E P R I M A R Y R E V E N U E G R O W T H D R I V E R W H I L E N E W S P A P E R L A G S

Quebecor recently reported Q1/09 (March 2009) results. Revenue grew by 2.2% Y/Y overall to $896.2 million (Figure 68). On a segmented

basis, cable revenue grew by 10.9% to $477.5 million. Newspaper revenue fell by 11.7% to $245.5 million. Broadcasting revenue grew by 3.1%

to $109.8 million. Leisure & Entertainment revenue grew by 2.4% to $64.1 million, while Interactive revenue grew by 10.2% to $22.7 million.


-200

0

200

400

600

800

1,000

1,200

1,400

Ma

r-0

7

Jun

-07

Se

p-0

7

De

c-0

7

Ma

r-0

8

Jun

-08

Se

p-0

8

De

c-0

8

Ma

r-0

9

Jun

-09

Se

p-0

9

De

c-0

9

Ma

r-1

0

Jun

-10

Se

p-1

0

De

c-1

0

Ma

r-1

1

Jun

-11

Se

p-1

1

De

c-1

1

($ m

m)

0%

2%

4%6%

8%

10%

12%14%

16%

18%

(%)

Cable revenue (LHS) Newspapers revenue (LHS)

Broadcasting revenue (LHS) Leisure and Entertainment revenue (LHS)

Interactive Technologies and Communications revenue (LHS) Internet/Portals revenue (LHS)

Head office and inter-segment revenue (LHS) Total revenues - yoy growth (RHS)

Figure 68. Quebecor Segmented Revenue, by Quarter



-500

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

De

c-0

7

De

c-0

8

De

c-0

9

De

c-1

0

De

c-1

1

($ m

m)

0%

2%

4%

6%

8%

10%

12%

(%)

Cable revenue (LHS) Newspapers revenue (LHS)Broadcasting revenue (LHS) Leisure and Entertainment revenue (LHS)

Interactive Technologies and Communications revenue (LHS) Internet/Portals revenue (LHS)Head office and inter-segment revenue (LHS) Total revenues - yoy growth (RHS)

Figure 69. Quebecor Segmented Revenue, Annual


On a consolidated basis, we are estimating revenue for F2009 of $3,851.6 million, up 3.3% from F2008 (Figure 69). For F2010, we expect

growth of 5.3%, with estimated revenue of $4,056.7 million. Consensus estimates are revenue of $3,817.1 million and $4,000.9 million,

respectively. The F2009 growth will largely be driven by, in our estimation, growth in the cable and broadcasting segments, up an

estimated 10.2% and 3.8%, respectively. We are forecasting a 7.4% decline in newspaper revenue and a 0.5% decline in the Leisure &

Entertainment segment for F2009. We expect the Interactive division to grow by 10.0%, although it is a small relative contributor to

revenue. We expect F2010 growth of 8.0% in cable, 5.0% in broadcasting, 10.0% in Interactive, and 2.0% in Leisure & Entertainment. We

are forecasting a modest recovery in F2010 for the newspaper segment, with estimated growth of 1.1%.


59

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

C A B L E P R O F I T A B I L I T Y I M P R O V E S W H I L E N E W S P A P E R L O S E S M O R E G R O U N D

The cable segment continues to generate the majority of profit, especially as the newspaper segment declines (Figure 70). In Q1/09,

cable generated $223.6 million of operating profit (46.8% of revenue) or 82.2% of total operating profit of $272.1 million. Cable margins

continued to improve, increasing from 45.7% in the prior year and 45.9% in Q4/08. Newspaper operating profit fell to $29.7 million

(12.1% of revenue) or 10.9% of total operating profit. That compares to operating profit of $46.0 million in Q1/08 and $56.4 million in

Q4/08. Broadcasting operating profit increased to $12.3 million (11.2% of revenue) compared to $11.0 million (10.3%) the prior year.

Consolidated segment operating profit increased to $272.1 million (30.4% of revenue) from $256.7 million (29.3%) the prior year.

EBITDA & EBITDA Margin, by Quarter

-50

0

50

100

150

200

250

300

350

400

Ma

r-0

7

Jun

-07

Se

p-0

7

De

c-0

7

Ma

r-0

8

Jun

-08

Se

p-0

8

De

c-0

8

Ma

r-0

9

Jun

-09

Se

p-0

9

De

c-0

9

Ma

r-1

0

Jun

-10

Se

p-1

0

De

c-1

0

Ma

r-1

1

Jun

-11

Se

p-1

1

De

c-1

1

($ m

m)

0%

5%

10%

15%

20%

25%

30%

35%

(%)

Cable (LHS) Newspapers (LHS)

Broadcasting (LHS) Leisure and Entertainment (LHS)

Interactive Technologies and communications (LHS) Internet/Portals (LHS)

Head office (LHS) EBITDA margin (RHS)

Figure 70. Quebecor EBITDA, by Quarter



-6,000

-5,000

-4,000

-3,000

-2,000

-1,000

0

Ma

r-0

7

Jun

-07

Se

p-0

7

De

c-0

7

Ma

r-0

8

Jun

-08

Se

p-0

8

De

c-0

8

Ma

r-0

9

Jun

-09

Se

p-0

9

De

c-0

9

Ma

r-1

0

Jun

-10

Se

p-1

0

De

c-1

0

Ma

r-1

1

Jun

-11

Se

p-1

1

De

c-1

1

($ m

m)

-200

-100

0

100

200

300

400

($ m

m)

Net Cash (LHS) Operating cash flow Acquisition of capital assets

Figure 71. Quebecor Cash and Cash Flow, by Quarter


S T R O N G O P E R A T I N G C A S H F L O W S U P P O R T S H I G H C A P E X …

Quebecor generated $213.7 million in operating cash flow (cash flow from operations excluding changes in non-cash working

capital) in Q1/09 (Figure 71). Despite the strong cash flow, net debt (excluding the impact of exchangeable debentures and

hedging) rose to $4,534 million from $4,434 million in Q4/08 due to additional debt financing in Q1. Although we expect continued

high capex levels due to the AWS (Advanced Wireless Services) rollout, Quebecor’s strong operating cash flow will easily cover

expected capital expenditures.


60

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

… A N D R E C E N T D E B T R E F I N A N C I N G P R O V I D E S L O N G - T E R M S T A B I L I T Y

One concern that has impacted the media sector significantly has been the tight credit markets. With many companies issuing

significant amounts of debt to pay for acquisitions, the recent downturn has left a number of companies in very dire financial

conditions due to their reduced cash flows. However, despite having a fairly significant level of debt overall with a debt/EBITDA

ratio of 4.0x as at March 2009, Quebecor does not have significant amounts of debt maturing in the next few years (Figure 72). This

should allow the company plenty of time to refinance any debt as necessary.

Consolidated Debt Maturity, Annual

37 68168

270

702838

217

1,308

802

00

200

400

600

800

1,000

1,200

1,400

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

($ m

m)

Note: Does not include debt from TVA

Figure 72. Quebecor Debt Maturity, Annual



1.87

2.943.27

3.65

4.11

2.75 2.86

0

50

100

150

200

250

300

Dec-07

F2007A

Dec-08

F2008A

Dec-09

F2009E

Dec-10

F2010E

Dec-11

F2011E

($ m

m)

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50

($)

Adjusted Net Income Adjusted EPS (Diluted) Consensus

Figure 73. Quebecor Net Income and EPS, Annual


N E T I N C O M E

We are estimating adjusted EPS growth of 11%-12% in the next three years, ahead of consensus estimates (Figure 73).


61

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

Q U E B E C O R R A N K S 9 T H O V E R A L L B A S E D O N K E Y F I N A N C I A L M E T R I C S

Quebecor is the fifth largest public Media company in Canada by revenue, based on the most recent quarterly results (Q4/CY08).

Its Y/Y growth rate of 1.0% ranked 25th overall. The company’s EBITDA margin of 30.1% ranked 11th. Quebecor has a negative net

cash position of $4,453.8 million, ranked 43rd overall. The company’s $803.2 million of operating cash flow ranks sixth. Overall,

Quebecor ranks ninth with a total score of 156 (Figure 74).

Overall

Rank Company Ticker

Rev

($ mm) Rank

Rev growth

(%) Rank

EBITDA

(%) Rank

Net cash

($ mm) Rank

Op cash

flow ($ mm) Rank

Net

score






9 Quebecor Inc. TSX:QBR.B 3,730.1 5 1.0 25 30.1 11 -4,453.8 43 803.2 6 156

Total 82,925.0 -54,643.9 21,945.3

Average 5.4 7.3





On a consolidated basis, we are estimating revenue for F2009 of $3,851.6 million, up 3.3% from F2008 (Figure 75). For F2010, we expect

growth of 5.3%, with estimated revenue of $4,056.7 million. Consensus estimates are revenue of $3,817.1 million and $4,000.9 million,

respectively. The F2009 growth will largely be driven by, in our estimation, growth in the cable and broadcasting segments, up an

estimated 10.2% and 3.8%, respectively. We are forecasting a 7.4% decline in newspaper revenue and a 0.5% decline in the Leisure &

Entertainment segment for F2009. We expect the Interactive division to grow by 10.0%, although it is a small relative contributor to

revenue. We expect F2010 growth of 8.0% in cable, 5.0% in broadcasting, 10.0% in Interactive, and 2.0% in Leisure & Entertainment. We

are forecasting a modest recovery in F2010 for the newspaper segment with estimated growth of 1.1%.

With the higher profitability and revenue growth of the cable segment, we estimate a 4.2% increase in EBITDA in F2009 to $1,168.2 million

or 30.3% of revenue compared to 30.1% of revenue in F2008. We are estimating a further 7.5% increase in F2010 to $1,255.8 million or

31.0% of revenue, driven by further increases in cable profitability offsetting reduced operating profit in the newspaper segment.


62

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

We expect adjusted EPS of $3.27 in F2009, well above consensus of $2.75. Our F2010 estimate is $3.65, also above consensus of $2.86.

F2008A F2009E F2010E

(Year-End Dec 31, CAD$ millions) Actual Current Consensus Current Consensus

Cable 1,804.2 1,988.5 2,147.5

Newspapers 1,181.4 1,094.4 1,106.5

Broadcasting 436.7 453.2 475.9

Leisure and Entertainment 301.9 300.4 306.4

Interactive Technologies and Communic 89.6 98.6 108.5

Head office and inter-segment -83.7 -83.4 -88.0

Total Revenue (CAD$ mm) 3,730.1 3,851.6 3,817.1 4,056.7 4,000.9

growth (%) 10.8 3.3 2.3 5.3 4.8

Cable 797.2 941.4 1,038.2

Newspapers 227.1 117.4 99.6

Broadcasting 66.3 70.7 77.8

Leisure and Entertainment 20.5 29.2 32.8

Interactive Technologies and communic 5.1 4.2 7.3

Total EBITDA (CAD $mm) 1,121.0 1,168.2 1,149.5 1,255.8 1,186.6

as % 30.1 30.3 30.1 31.0 29.7

Adjusted EPS (CAD$) 2.94 3.27 2.75 3.65 2.86

growth (%) 57.2 11.2 -6.3 11.7 3.9


Figure 75. Quebecor Estimate Summary


C A T A L Y S T S

W I R E L E S S R O L L O U T

Quebecor has committed significant amounts of capital to its wireless network rollout plans. Accelerated or delayed progress in

rolling out the network relative to Street expectations could impact Quebecor’s financial and stock performance.

P O T E N T I A L C A N W E S T A S S E T P U R C H A S E

With CanWest undergoing significant difficulties, it is possible that the company will be forced to sell assets in order to help pay

down its high debt levels. Quebecor could acquire certain assets from CanWest that could boost Quebecor’s financial performance

and presence in the broadcasting market.


63

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

R I S K S

W I R E L E S S D E L A Y S

Quebecor has committed significant financial assets to its wireless play as part of its “quad-play” bundling strategy. Any delay in

rolling out the company’s next-generation high-speed wireless network could impact financial performance through reduced

subscriber levels. While the company has taken on additional financial leverage in order to pay for the wireless network – delayed

cash flow from the wireless segment would not restrict the company’s financial flexibility in other segments due to its strong core

cash flows.

R E G U L A T O R Y

Quebecor’s TVA subsidiary is regulated by the Canadian Radio-Television and Telecommunications Commission under the

Broadcasting Act. The Act controls and regulates broadcasting activity in Canada. As such, Quebecor’s subsidiary’s licenses and

ability to operate may be subject to change based on regulatory changes in the Act. For example, the ongoing dispute regarding

Part II fees means that the company has been accruing expenses in its financial statements for the past few quarters.

D E B T L E V E L S

Quebecor carries, on a consolidated basis, a significant level of debt. If the company’s operating cash flow were under pressure, for

example due to continued declines in the newspaper segment, this could cause debt-related covenants to occur which would

impact the company’s overall flexibility to act in its various segments. Note though that the company does have access to

significant (almost $1 billion worth) of liquidity and no near-term debt maturities.

L A B O U R D I S P U T E S

Quebecor has been subject to several labour disputes over the past years, especially in its newspaper segment. Further disputes

could have an impact on Quebecor’s financial results. Note that the company recently renewed its collective agreements with all

unionized employees, with terms ranging from December 2013 to August 2015. The company has also undertaken various

initiatives to improve the operating cost structure in the newspaper segment.


64

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


T I G H T H I S T O R I C A L V A L U A T I O N R A N G E

Quebecor has traded in a very tight valuation range over the past five years, with EV/trailing revenue ranging between 0.8x to 1.2x

(Figure 76). The overall average is 1.0x. Currently, Quebecor is trading above its historical average at 1.8x.

Historical EV/Revenue1.8x

1.0x

0.00.2

0.40.6

0.81.01.2

1.41.6

1.82.0

7/3

0/2

00

4

10

/1/2

00

4

12

/1/2

00

4

2/1

/20

05

4/1

/20

05

6/1

/20

05

7/2

9/2

00

5

9/3

0/2

00

5

12

/1/2

00

5

2/1

/20

06

3/3

1/2

00

6

6/1

/20

06

8/1

/20

06

9/2

9/2

00

6

12

/1/2

00

6

2/1

/20

07

3/3

0/2

00

7

6/1

/20

07

8/1

/20

07

10

/1/2

00

7

11

/30

/20

07

2/1

/20

08

4/1

/20

08

5/3

0/2

00

8

8/1

/20

08

10

/1/2

00

8

12

/1/2

00

8

1/3

0/2

00

9

4/1

/20

09

5/2

9/2

00

9

(x)

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

$40.00

$45.00

($)


Current

Average

Figure 76. Quebecor EV/Revenue (trailing)

Source. Capital IQ

On an EV/EBITDA basis (Figure 77), Quebecor has traded at an average of 6.5x TTM EBITDA with a high of 7.9x and a low of 4.0x.

Currently, Quebecor is trading at 6.1x, in the lower end of its historical range.

Historical EV/EBITDA

6.1x

6.5x

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

8/4

/20

05

10

/4/2

00

5

12

/2/2

00

5

2/3

/20

06

4/4

/20

06

6/2

/20

06

8/4

/20

06

10

/4/2

00

6

12

/4/2

00

6

2/2

/20

07

4/4

/20

07

6/4

/20

07

8/3

/20

07

10

/4/2

00

7

12

/4/2

00

7

2/4

/20

08

4/4

/20

08

6/4

/20

08

8/1

/20

08

10

/3/2

00

8

12

/4/2

00

8

2/4

/20

09

4/3

/20

09

6/4

/20

09

(x)

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

45.00

($)

EV/EBITDA Average EV/EBITDA Monthly Closing Price

CurrentAverage

Figure 77. Quebecor EV/EBITDA (trailing)

Source. Capital IQ


65

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

A D I S C O U N T T O C O M P S

We compared QBR’s historical EV/EBITDA valuation to its comps in the Telecom (Figure 78), Broadcasting (Figure 79), and Publishing

(Figure 80) sectors. QBR has generally traded at a discount to the group median. The Publishing comps have traded at an average

of 8.9x trailing EBITDA versus 6.5x for QBR.


0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

7/2

/20

04

9/3

/20

04

11

/4/2

00

4

1/4

/20

05

3/4

/20

05

5/4

/20

05

7/4

/20

05

9/2

/20

05

11

/4/2

00

5

1/4

/20

06

3/3

/20

06

5/4

/20

06

7/4

/20

06

9/1

/20

06

11

/3/2

00

6

1/4

/20

07

3/2

/20

07

5/4

/20

07

7/4

/20

07

9/4

/20

07

11

/2/2

00

7

1/4

/20

08

3/4

/20

08

5/2

/20

08

7/4

/20

08

9/4

/20

08

11

/4/2

00

8

1/2

/20

09

3/4

/20

09

5/4

/20

09

PUBLISHING MEDIAN TSX:QBR.B PUBLISHING MEDIAN Avg TSX:QBR.B Avg

Figure 78. Relative EV/EBITDA Valuation – Telecom Group

Source. Capital IQ


0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

7/2

/20

04

9/3

/20

04

11

/4/2

00

4

1/4

/20

05

3/4

/20

05

5/4

/20

05

7/4

/20

05

9/2

/20

05

11

/4/2

00

5

1/4

/20

06

3/3

/20

06

5/4

/20

06

7/4

/20

06

9/1

/20

06

11

/3/2

00

6

1/4

/20

07

3/2

/20

07

5/4

/20

07

7/4

/20

07

9/4

/20

07

11

/2/2

00

7

1/4

/20

08

3/4

/20

08

5/2

/20

08

7/4

/20

08

9/4

/20

08

11

/4/2

00

8

1/2

/20

09

3/4

/20

09

5/4

/20

09

BROADCASTING MEDIAN TSX:QBR.B BROADCASTING MEDIAN Avg TSX:QBR.B Avg

Figure 79. Relative EV/EBITDA Valuation – Broadcasting Group

Source. Capital IQ

The Broadcasting comps have traded at an average of 10.0x trailing EBITDA versus 6.5x for QBR.


66

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

The Telecom comps have traded at an average of 8.7x trailing EBITDA versus 6.5x for QBR.


0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x7

/2/2

00

4

9/3

/20

04

11

/4/2

00

4

1/4

/20

05

3/4

/20

05

5/4

/20

05

7/4

/20

05

9/2

/20

05

11

/4/2

00

5

1/4

/20

06

3/3

/20

06

5/4

/20

06

7/4

/20

06

9/1

/20

06

11

/3/2

00

6

1/4

/20

07

3/2

/20

07

5/4

/20

07

7/4

/20

07

9/4

/20

07

11

/2/2

00

7

1/4

/20

08

3/4

/20

08

5/2

/20

08

7/4

/20

08

9/4

/20

08

11

/4/2

00

8

1/2

/20

09

3/4

/20

09

5/4

/20

09

TELECOM MEDIAN TSX:QBR.B TELECOM MEDIAN Avg TSX:QBR.B Avg

Figure 80. Relative EV/EBITDA Valuation – Publishing Group

Source. Capital IQ

N A V D R I V E S $ 2 6 . 0 0 T A R G E T P R I C E

Our 12-month target price for Quebecor is based on a net asset value (Figure 81). We value the cable assets at 7.0x EBITDA

(compared to a 9.0x historical EV/EBITDA multiple for cable companies), the newspaper assets at 5.0x (a lower multiple due to the

challenges in the newspaper market), and the corporate assets at 6.0x. The company’s stake in TVA is valued at the current market

value. The FTM combined value of the assets is $127.29 per share. Netting off $71.81 per share in debt and applying a 15% public

company discount implies an FTM target price of $25.80.

Current Value FTM EBITDA ($mm) Multiple Value ($mm) Per Share

Cable 967.2 7.0x 6,770.2 $105.27

Newspapers 72.2 5.0x 360.9 $5.61

Corporate/Other 40.8 6.0x 245.0 $3.81

Total 1,080.2 6.8x 7,376.1 $114.70

TVA.B 109.8 $1.71

Subtotal $116.40

Net Debt -4,534.2 -$70.51


Quebecor Media Ownership 54.7%

Public Company discount -15%

Shares O/S 64.3

Current Implied Value $21.34

FTM Value FTM+1 EBITDA ($mm) Multiple Value ($mm) Per Share

Cable 1,061.2 7.0x 7,428.5 $115.51

Newspapers 79.4 5.0x 397.0 $6.17

Corporate/Other 41.8 6.0x 250.7 $3.90

Total 1,182.4 6.8x 8,076.2 $125.58

TVA.B 109.8 $1.71

Subtotal $127.29

Net Debt -4,618.1 -$71.81


Quebecor Media Ownership 54.7%

Public Company discount -15%

Shares O/S 64.3

FTM Implied Value $25.80

Net Asset Valuation

Figure 81. Quebecor Net Asset Valuation

Source. Capital IQ


67

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

Therefore, we are establishing a $26.00 FTM target price for TSX:QBR.B. Our target price implies 4.9x EV/EBITDA, and 7.0x P/E based

on our FTM+1 (Mar/2011) estimates. The U.S. Broadcasting group (Figure 82) trades at 9.4x EV/EBITDA (CY) and 16.1x P/E (CY), the

Publishing group trades at 7.5x EV/EBITDA and 14.1x P/E (CY) while the Telecom group trades at 5.9x EV/EBITDA and 16.5x P/E (CY).

The Canadian Broadcasting group trades (Figure 88) at 8.1x EV/EBITDA and 10.4x P/E, the Publishing group at 6.4x EV/EBITDA (CY)

and 6.3x P/E (CY), while the Telecom group trades at 4.7x EV/EBITDA and 12.0x P/E (CY).


Trading Multiples

Company Name

USD Market

Cap ($ mm)

USD

Enterprise

Value

($ mm)

Dividend

Yield

CFFO

Yield

CFFO

Yield

(EV)

P/

CFFO

EV/

CFFO

FCF

Yield P/FCF

TEV/

LTM

EBITDA

TEV/

NTM

EBITDA

TEV/

EBITDA

CY

TEV/

EBITDA

CY+1

P/LTM

EPS

P/NTM

EPS

P/E

CY

P/E

CY+1



Central European Media Enterprises Ltd. (NasdaqGS:CETV) 1,334.1 2,246.9 NM 5.2% 3.1% 19.2x 32.3x 24.3% 4.1x 8.8x 11.8x 12.2x 10.9x NM 17.8x 18.7x 15.4x














Gannett Co., Inc. (NYSE:GCI) 985.5 4,820.8 3.8% 86.9% 17.8% 1.2x 5.6x 88.3% 1.1x 3.4x 5.2x 5.2x 5.1x NM 3.5x 3.2x 3.3x

Interactive Data Corporation (NYSE:IDC) 2,292.0 2,048.4 3.3% 8.3% 9.3% 12.0x 10.7x 5.3% 18.8x 7.8x 7.5x 7.6x 6.9x 16.5x 17.0x 17.4x 15.7x

John Wiley & Sons Inc. (NYSE:JW.A) 1,872.2 2,687.8 1.6% 13.6% 9.4% 7.4x 10.6x NM NM 8.5x 8.7x 8.7x NM 14.4x 13.3x 13.4x NM

Lee Enterprises Inc. (NYSE:LEE) 42.7 1,236.9 NM 237.1% 8.2% 0.4x 12.2x 135.8% 0.7x 6.9x NM NM NM NM NM NM NM

Media General, Inc. (NYSE:MEG) 63.7 785.3 NM 92.1% 7.5% 1.1x 13.4x 218.7% 0.5x 7.4x NM 7.5x 6.8x NM NM NM NM

Meredith Corp. (NYSE:MDP) 1,323.4 1,704.0 3.1% 14.2% 11.0% 7.0x 9.1x 10.3% 9.7x 7.7x 8.3x 8.3x NM 16.5x 14.5x 14.6x 12.9x

Morningstar Inc. (NasdaqGS:MORN) 2,020.5 1,734.8 NM 7.1% 8.2% 14.2x 12.2x 2.6% 39.0x 10.4x NM NM NM 22.1x 23.5x 23.7x 21.7x

Scholastic Corporation (NasdaqGS:SCHL) 765.0 1,101.8 1.4% 5.1% 3.5% 19.6x 28.3x 4.6% 21.7x 7.6x 5.6x 5.8x NM NM 13.2x 14.1x NM

The McClatchy Company (NYSE:MNI) 70.3 2,087.6 NM 451.9% 15.2% 0.2x 6.6x 540.3% 0.2x 5.9x 8.9x 8.5x 10.4x NM NM NM NM

The McGraw-Hill Companies, Inc. (NYSE:MHP) 9,670.9 10,602.4 2.9% 13.9% 12.7% 7.2x 7.9x 13.1% 7.6x 6.7x 6.8x 7.0x 6.3x 12.4x NM 13.6x 11.9x

The New York Times Company (NYSE:NYT) 928.6 2,179.1 NM 24.8% 10.6% 4.0x 9.5x NM NM 6.8x 10.2x 10.3x 9.9x NM NM NM 51.6x

Valassis Communications Inc. (NYSE:VCI) 332.3 1,363.7 NM 39.9% 9.7% 2.5x 10.3x 29.9% 3.3x 7.1x 6.6x 6.7x 6.5x NM 9.9x 10.2x 9.1x

Washington Post Co. (NYSE:WPO) 3,329.0 3,089.5 2.4% 15.8% 17.0% 6.3x 5.9x 6.3% 15.9x 5.8x 5.2x 5.5x 4.3x NM 18.6x 21.5x 13.4x


Cablevision Systems Corporation (NYSE:CVC) 5,591.1 17,449.3 2.2% 25.9% 8.3% 3.9x 12.0x 13.8% 7.3x 7.5x 7.3x 7.1x 6.8x NM 19.7x 19.2x 14.3x

Comcast Corporation (NasdaqGS:CMCS.A) 41,722.4 72,113.4 1.9% 25.1% 14.5% 4.0x 6.9x 8.5% 11.8x 5.4x 5.2x 5.3x 5.1x 16.3x 14.4x 13.4x 12.0x

DIRECTV Group, Inc. (NasdaqGS:DTV) 22,336.6 26,372.6 NM 17.0% 14.4% 5.9x 6.9x 6.9% 14.4x 5.3x 4.7x 4.9x 4.3x 17.8x NM 15.0x 10.5x

Dish Network Corp. (NasdaqGS:DISH) 7,138.5 11,103.0 NM 30.6% 19.7% 3.3x 5.1x NM NM 4.9x 3.9x 3.7x 3.8x 7.6x 7.4x 7.2x 7.3x

Knology, Inc. (NasdaqGM:KNOL) 288.4 833.6 NM 29.8% 10.3% 3.4x 9.7x 11.7% 8.5x 6.4x 5.8x 5.9x 5.6x NM 29.2x 45.5x 20.8x

Liberty Entertainment Group (NasdaqGS:LMDI.A) 12,128.5 13,280.5 NM NM NM NM NM NM NM 62.9x 37.7x 37.7x 37.3x 2.1x 21.1x 21.1x 18.7x

Liberty Global Inc. (NasdaqGS:LBTY.A) 3,800.0 24,910.7 NM 84.1% 12.8% 1.2x 7.8x 27.0% 3.7x 5.6x 5.3x 5.4x 5.2x NM 32.4x 81.2x 11.6x

Mediacom Communications Corp. (NasdaqGS:MCCC) 434.4 3,782.0 NM 69.4% 8.0% 1.4x 12.5x 3.0% 33.5x 7.3x 7.0x 7.1x 6.9x NM 10.8x 11.2x 9.8x

Outdoor Channel Holdings, Inc. (NasdaqGM:OUTD) 179.6 128.0 NM 5.2% 7.3% 19.3x 13.8x 1.9% NM 17.4x NM 11.1x NM 94.8x 68.2x 77.7x 49.9x

RCN Corp. (NasdaqGS:RCNI) 227.2 896.9 NM 62.7% 15.9% 1.6x 6.3x 11.7% 8.5x 4.7x 4.2x 4.3x 4.1x NM NM NM NM

RRSat Global Communications Network Ltd. (NasdaqGS:RRST) 200.1 160.8 5.3% 9.6% 11.9% 10.4x 8.4x 4.7% 21.2x 7.6x 6.0x 6.3x 5.4x 14.5x 13.6x 14.1x 12.1x

Scripps Networks Interactive, Inc. (NYSE:SNI) 4,721.0 4,832.2 1.0% 13.1% 12.8% 7.6x 7.8x 15.4% 6.5x 7.2x 7.8x 8.0x 7.2x NM 17.8x 18.0x 16.0x

SIRIUS XM Radio Inc. (NasdaqGS:SIRI) 1,350.0 4,061.0 NM 4.0% 1.3% 25.3x NM 52.1% 1.9x 31.4x 11.2x 12.8x 8.3x NM NM NM NM

Time Warner Cable Inc. (NYSE:TWC) 11,387.5 34,453.5 NM 46.1% 15.3% 2.2x 6.6x 9.4% 10.7x 5.5x 5.4x 5.5x 5.2x NM 10.1x 10.9x 9.3x

Virgin Media, Inc. (NasdaqGS:VMED) 2,930.4 8,970.8 1.3% 37.8% 12.4% 2.6x 8.1x 19.0% 5.3x 4.8x 4.2x 4.2x 4.0x NM NM NM NM





Low 12.9 128.0 1.0% 3.7% 1.3% 0.2x 4.0x 1.9% 0.2x 3.1x 3.9x 3.7x 3.8x 2.1x 2.4x 0.6x 1.9x


EBITDA EPS


Source. Capital IQ


68

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

M I X E D P R I C E P E R F O R M A N C E R E L A T I V E T O C O M P S

On a relative price performance basis, QBR.B has performed below both the U.S. and the Canadian Telecom groups (Figure 84).

Cable & Satellite

0

20

40

60

80

100

120

6/4

/20

08

6/1

7/2

00

8

6/3

0/2

00

8

7/1

1/2

00

8

7/2

4/2

00

8

8/6

/20

08

8/1

9/2

00

8

9/1

/20

08

9/1

2/2

00

8

9/2

5/2

00

8

10

/8/2

00

8

10

/21

/20

08

11

/3/2

00

8

11

/14

/20

08

11

/27

/20

08

12

/10

/20

08

12

/23

/20

08

1/7

/20

09

1/2

0/2

00

9

2/2

/20

09

2/1

3/2

00

9

2/2

6/2

00

9

3/1

1/2

00

9

3/2

4/2

00

9

4/6

/20

09

4/2

0/2

00

9

5/1

/20

09

5/1

4/2

00

9

5/2

7/2

00

9

Index: US Cable & Sat (Market Cap Weights) Index: Cdn Cable & Sat (Market Cap Weights) TSX:QBR.B

Figure 84. CJR.B Relative Price Performance – Telecom Group

Source. Capital IQ


Trading Multiples

Company Name

CAD

Market

Cap

($m)

CAD

Enterprise

Value ($m)

Dividend

Yield

CFFO

Yield

CFFO

Yield

(EV)

P/

CFFO

EV/

CFFO

FCF

Yield P/FCF

TEV/

LTM

EBITDA

TEV/

NTM

EBITDA

TEV/

EBITDA

CY

TEV/

EBITDA

CY+1

P/LTM

EPS

P/NTM

EPS P/E CY

P/E

CY+1









Broadview Press Inc. (TSXV:BDP) 0.4 0.6 NM NM NM NM NM 46.7% 2.1x NM NM NM NM 3.7x NM NM NM

FP Canadian Newspapers Limited Partnership (TSX:FP.UN) 29.0 138.3 27.1% 33.4% 7.0% 3.0x 14.3x 23.7% 4.2x 6.5x NM 7.6x 7.3x NM NM NM NM

Glacier Media, Inc. (TSX:GVC) 170.0 300.9 NM 20.1% 11.4% 5.0x 8.8x 6.5% 15.3x 6.7x 7.3x 7.4x 6.6x 7.5x 7.3x 7.1x 6.2x

Lingo Media Corporation (TSXV:LM) 13.5 12.2 NM NM NM NM NM NM NM NM NM NM NM NM NM NM NM

McGraw-Hill Ryerson Ltd. (TSX:MHR) 73.9 50.4 2.8% 28.0% 41.1% 3.6x 2.4x 27.4% 3.6x 2.9x NM NM NM 7.2x NM NM NM

MPL Communications Inc. (TSXV:MPZ) 0.4 0.6 NM NM NM NM NM 231.4% 0.4x 2.1x NM NM NM NM NM NM NM

Multimedia Nova Corp. (TSXV:MNC.A) 0.9 10.8 NM NM NM NM NM NM NM 12.8x NM NM NM NM NM NM NM

Quebecor Inc. (TSX:QBR.B) 1,164.1 6,876.3 1.1% 72.3% 12.2% 1.4x 8.2x NM NM 6.1x 6.0x 6.0x 5.8x NM 6.5x 6.6x 6.3x

Thomson Reuters Corporation (TSX:TRI) 28,314.1 35,180.1 3.3% 12.1% 9.7% 8.3x 10.3x NM NM 9.2x 10.1x 9.8x 8.8x 15.6x 17.3x 18.2x 15.2x

Torstar Corporation (TSX:TS.B) 380.7 999.7 7.7% 35.3% 13.5% 2.8x 7.4x 29.5% 3.4x 5.1x 6.1x 5.6x 5.3x NM 6.2x 6.1x 4.9x

Transcontinental Inc. (TSX:TCL.A) 666.4 1,492.5 3.9% 39.5% 17.7% 2.5x 5.7x NM NM 4.4x 4.5x 4.5x 4.2x NM 5.8x 5.8x 5.2x

Yellow Pages Income Fund (TSX:YLO.UN) 2,750.3 5,961.7 14.8% 27.1% 12.5% 3.7x 8.0x 20.1% 5.0x 6.4x 6.5x 6.4x 6.4x 6.2x 5.1x 4.9x 5.0x


BCE, Inc. (TSX:BCE) 19,073.0 32,881.0 6.2% 31.0% 18.0% 3.2x 5.6x 14.1% 7.1x 4.8x 4.7x 4.7x 4.7x 19.4x 10.3x 10.4x 10.4x

Canadian Satellite Radio Holdings Inc (TSX:XSR) 27.2 161.0 NM NM NM NM NM 15.3% 6.5x NM NM NM NM NM NM NM NM

Cogeco Cable Inc. (TSX:CCA) 1,397.0 2,562.9 1.7% 28.9% 15.7% 3.5x 6.4x 3.3% 30.2x 5.5x 5.1x 5.1x 4.8x NM 13.4x 13.2x 11.2x

Cogeco Inc. (TSX:CGO) 376.7 2,211.5 1.4% 108.6% 18.5% 0.9x 5.4x 13.1% 7.7x 4.7x 4.2x 4.2x 3.9x NM 8.6x 9.0x 7.2x

JumpTV Inc. (TSX:JTV) 88.8 61.4 NM NM NM NM NM 3.8% 26.5x NM NM NM NM NM NM NM NM

Manitoba Telecom Services, Inc. (TSX:MBT) 2,215.9 3,026.5 7.6% 21.5% 15.8% 4.6x 6.3x 9.5% 10.5x 4.8x 4.7x 4.7x 4.6x 17.5x 11.8x 12.0x 11.8x

Rogers Communications Inc. (TSX:RCI.B) 20,534.2 29,276.2 3.6% 16.1% 11.3% 6.2x 8.9x NM NM 7.1x 6.8x 6.8x 6.4x 21.4x 15.8x 16.1x 14.2x

Shaw Communications, Inc. (TSX:SJR.B) 8,048.0 11,033.5 4.5% 16.9% 12.3% 5.9x 8.1x 3.8% 26.5x 8.0x 6.8x 7.0x 6.5x 15.0x 14.2x 14.6x 13.1x

TELUS Corporation (TSX:T) 10,409.7 16,880.7 5.8% 26.9% 16.6% 3.7x 6.0x NM NM 4.4x 4.6x 4.6x 4.5x 9.1x 10.6x 10.0x 10.1x





Low 0.3 -44.2 1.1% 0.7% 0.8% 0.7x 1.0x 0.1% 0.2x 1.5x 2.2x 2.3x 2.5x 3.7x 2.1x 2.1x 1.7x


EBITDA EPS


Source. Capital IQ


69

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

On a relative price performance basis, QBR.B has performed inline with the U.S. and the Canadian Publishing groups (Figure 86).

Broadcasting

0

20

40

60

80

100

120

6/4

/20

08

6/1

6/2

00

8

6/2

6/2

00

8

7/8

/20

08

7/1

8/2

00

8

7/3

0/2

00

8

8/1

1/2

00

8

8/2

1/2

00

8

9/2

/20

08

9/1

2/2

00

8

9/2

4/2

00

8

10

/6/2

00

8

10

/16

/20

08

10

/28

/20

08

11

/7/2

00

8

11

/19

/20

08

12

/1/2

00

8

12

/11

/20

08

12

/23

/20

08

1/6

/20

09

1/1

6/2

00

9

1/2

8/2

00

9

2/9

/20

09

2/1

9/2

00

9

3/3

/20

09

3/1

3/2

00

9

3/2

5/2

00

9

4/6

/20

09

4/1

7/2

00

9

4/2

9/2

00

9

5/1

1/2

00

9

5/2

1/2

00

9

6/2

/20

09

Index: US Broadcasting (Market Cap Weights) Index: Cdn Broadcasting (Market Cap Weights) TSX:QBR.B

Figure 85. CJR.B Relative Price Performance – Broadcasting Group

Source. Capital IQ

On a relative price performance basis, QBR.B has outperformed both the U.S. and the Canadian Broadcasting groups (Figure 85),

although it has recently lagged the Canadian group.

Publishing

0 20 40 60 80

100 120

6/4

/20

08

6/1

6/2

00

8

6/2

6/2

00

8

7/8

/20

08

7/1

8/2

00

8

7/3

0/2

00

8

8/1

1/2

00

8

8/2

1/2

00

8

9/2

/20

08

9/1

2/2

00

8

9/2

4/2

00

8

10

/6/2

00

8

10

/16

/20

08

10

/28

/20

08

11

/7/2

00

8

11

/19

/20

08

12

/1/2

00

8

12

/11

/20

08

12

/23

/20

08

1/6

/20

09

1/1

6/2

00

9

1/2

8/2

00

9

2/9

/20

09

2/1

9/2

00

9

3/3

/20

09

3/1

3/2

00

9

3/2

5/2

00

9

4/6

/20

09

4/1

7/2

00

9

4/2

9/2

00

9

5/1

1/2

00

9

5/2

1/2

00

9

6/2

/20

09

Index: US Publishing (Market Cap Weights) Index: Cdn Publishing (Market Cap Weights) TSX:QBR.B

Figure 86. CJR.B Relative Price Performance – Publishing Group

Source. Capital IQ

C O N C L U S I O N S T R E N G T H I N C A B L E O U T W E I G H S N E W S P A P E R D R A G

The acquisition of Videotron continues to pay off for Quebecor, with the company’s cable segment generating 50% of consolidated

revenue, but over 80% of consolidated EBITDA. While the company continues to face challenges in the newspaper segment, the

strength in the cable segment, augmented by significant long-term potential upside with the rollout of the company’s next-

generation wireless network, bodes well for Quebecor’s financial operating performance. With over 40% upside to our $26.00 target,

we are initiating coverage of Quebecor Inc. with a BUY recommendation.


70

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


QUEBECOR INC. (TSX:QBR.B)

COMPANY INFORMATION

Quebecor Inc., through its subsidiaries, operates as a communications company primarily in Canada, the United States, Europe, and Latin America. It operates in five segments: Cable,

Newspapers, Broadcasting, Leisure and Entertainment, and Interactive Technologies and Communications. The Cable segment offers television distribution, Internet, business solutions, and telephony and

wireless services, as well as involves in the rental of digital video discs and games. The Newspapers segment includes the printing, publishing, and distribution of daily newspapers, weekly

newspapers, and directories, as well as operates Internet sites, including French and English language portals, and specialized sites. The Broadcasting segment operates French and English language

general-interest television networks, specialized television networks, magazine publishing, and movie distribution businesses. The Leisure and Entertainment segment includes book publishing and

distribution; retail sales of CDs, books, videos, musical instruments, and magazines; and online sales of downloadable music; and music production and distribution. The Interactive Technologies and

Communications segment offers e-commerce solutions, technology integration, and IP solutions and creativity on the Internet. The company was founded in 1965 and is based in Montreal, Canada.

Stock Exchange TSX Latest Fiscal Year 12/31/2008 Primary Industry Publishing

Website http://www.quebecor.com Latest Fiscal Quarter 3/31/2009






52 Week High (6/05/08) 32.44 Beta 0.96

52 Week Low (12/05/08) 13.80 Float % 72.2%



Plus: Total Debt 4,800.9


Plus: Minority Interest 1,025.6 Last Week 0.1




TSX:QBR.B YTD (7.8%)

S&P 500 YTD 4.3%998 999 1000 2000






Snr Bonds and Notes 3,240.6 Total Debt 4,463.8 Revenue 9,809.9 3,365.9 3,730.1 3,749.2 3,851.6 4,056.7

Sub Bonds and Notes 0.0 EBITDA 1,438.3 949.3 1,121.0 1,136.5 1,168.2 1,255.8

Trust Preferred 0.0 Undrawn Revolver 764.3 Margin (%) 14.7% 28.2% 30.1% 30.3% 30.3% 31.0%

Capital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT 802.6 658.3 801.0 808.9 NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) 8.2% 19.6% 21.5% 21.6% NA NA

Total Principal Due 4,428.6 Other Available Credit 0.0 Net Income (93.9) (969.2) 187.3 (183.4) 210.2 234.8

Total Undrawn Credit 764.3 Margin (%) (1.0%) (28.8%) 5.0% (4.9%) 5.5% 5.8%

998 999 1000 2000 Diluted EPS (1.46) 4.19 (3.05) (2.85) 3.27 3.65

VALUATION MULTIPLES



TEV / Revenue 1.1x 1.1x 0.7x 1.8x 1.8x 1.7x Cash from Investing (648.0) (1,143.5) (1,370.8) (1,160.4)

TEV / EBITDA 7.6x 7.2x 4.2x 6.1x 5.9x 5.5x Cash from Finaning 70.0 437.8 537.2 431.4

TEV / EBIT 13.0x 12.6x 7.3x 8.5x NA NA Change in Cash (61.8) 31.8 (56.5) 114.0

P / E NM NM NM NM 5.5x 5.0x



Total Revenue (%) (3.9%) (65.7%) 10.8% 7.4% 3.3% 5.3% Total Liabilities 12,303.8 11,337.0 7,173.7 7,276.4

EBITDA (6.3%) (34.0%) 18.1% 10.9% 4.2% 7.5% Total Equity 1,308.7 436.9 885.0 937.5


EPS NM NM NM NM NM 11.7%




Péladeau, Pierre Beutel Goodman & Company Ltd. 6.5 10.07%


Péladeau, Érik Cibc Asset Management Inc. 0.7 1.02%

Dimensional Fund Advisors Lp 0.2 0.35%

Dion, Pierre Ig Investment Management, Ltd. 0.2 0.31%

Jarislowsky, Fraser Limited 0.1 0.23%

Dépatie, Robert Global Pension Fund (Norway) 0.1 0.22%

Natcan Investment Management Inc. 0.1 0.21%

Selected Board Members Title Td Asset Management, Inc. 0.1 0.21%

Neveu, Jean Ia Clarington Investments Inc. 0.1 0.11%

Péladeau, Pierre Neveu, Jean 0.1 0.10%

Péladeau, Érik Total Shares Outstanding 64.3 100.00%

Mulroney, Brian

Gouin, Serge

Laurin, Pierre

Income Statement

Cash Flow Statement

Chief Executive Officer, President, Interim Chief Financial Officer, Director, Chief

Executive Officer of Quebecor Media Inc, Chief Executive Officer of Sun Media

Corporation, President of Quebecor Media Inc, President of Sun Media

Corporation and Director of Quebecor Media Inc

Vice Chairman of the Board, Executive Vice President, Vice Chairman of

Quebecor World Inc and Vice Chairman of Quebecor Media Inc

Chief Executive Officer of TVA Group Inc and President of TVA Group Inc

Chief Executive Officer of Vidéotron Ltd and President of Vidéotron Ltd

Chairman of the Board and Chairman of TVA Group Inc

Chief Executive Officer, President, Interim Chief Financial Officer, Director, Chief

Executive Officer of Quebecor Media Inc, Chief Executive Officer of Sun Media

Corporation, President of Quebecor Media Inc, President of Sun Media

Corporation and Director of Quebecor Media Inc

Vice Chairman of the Board, Executive Vice President, Vice Chairman of

Quebecor World Inc and Vice Chairman of Quebecor Media Inc

Director and Chairman of Quebecor World Inc

Chairman of Quebecor Media Inc

Director, Chairman of Corporate Governance & Nominating Committee and

Member of Audit Committee

YOY Growth

-6%

-34%

18%

3% 3%

(40.0%)

(30.0%)

(20.0%)

(10.0%)

0.0%

10.0%

20.0%

30.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illio

ns)

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

7.0x

8.0x

EBITDA TEV / EBITDA

Quebecor Inc. (TSX:QBR.B) Price & Vol Chart

0.005.00

10.0015.0020.0025.0030.0035.0040.0045.00

9/6

/20

06

10

/20

/20

06

12

/5/2

00

6

1/1

9/2

00

7

3/5

/20

07

4/1

9/2

00

7

6/1

/20

07

7/1

8/2

00

7

8/3

1/2

00

7

10

/16

/20

07

11

/30

/20

07

1/1

4/2

00

8

2/2

8/2

00

8

4/1

1/2

00

8

5/2

8/2

00

8

7/1

1/2

00

8

8/2

6/2

00

8

10

/10

/20

08

11

/24

/20

08

1/8

/20

09

2/2

0/2

00

9

4/8

/20

09

5/2

2/2

00

9

($)

-

200

400

600

800

1,000

1,200

(00

0)



N O N C O V E R A G E P R O F I L E S

The following pages contain one-page profiles of the other companies in our Media universe, including Broadcasting (6 companies),

Publishing (11), Telecom (9), Advertising (6), and Movies & Entertainment (14).

71

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


ASIAN TELEVISION NETWORK INTERNATIONAL LTD. (TSXV:SAT)

COMPANY INFORMATIONAsian Television Network International Limited engages in broadcasting specialty television channels for the south Asian community in Canada. It operates various television channels, including

English language sports channel with primary focus on Commonwealth sports; an English Language News channel from New Delhi, India; various regional language channels; Hindi movie channels; a global

music channel; and general interest entertainment channels. The company has programming alliances with various broadcasters, including STAR PLUS, ZEE TV, B4U Movies, SONY ENTERTAINMENT

TELEVISION, ZEE CINEMA, ALPHA PUNJABI, ARY DIGITAL, B4U Music, JAYA TV, ZEE GUJARATI, AASTHA, ATN BANGLA, NDTV 24x7, and Cricket Plus. It also operates a radio channel on XM159 across North America with

news, sports, and entertainment. The company is based in Newmarket, Canada.

Stock Exchange TSXV Latest Fiscal Year 12/31/2008 Primary Industry Broadcasting

Website http://www.asiantelevision.com Latest Fiscal Quarter 3/31/2009



(in millions, except per share data)Valuation Market Data


52 Week High (9/30/08) 1.25 Beta 1.22

52 Week Low (12/16/08) 0.24 Float % 31.2%









TSXV:SAT YTD 12.0%

S&P 500 YTD 4.3%998 999 1000 2000






Snr Bonds and Notes 0.0 Total Debt 0.8 Revenue 11.1 14.9 14.6 14.7 NA NA

Sub Bonds and Notes 0.0 EBITDA 3.4 3.1 2.4 2.3 NA NA

Trust Preferred 0.0 Undrawn Revolver 0.0 Margin (%) 30.4% 20.7% 16.5% 15.5% NA NACapital Leases 0.1 Undrawn Commercial Paper 0.0 EBIT 2.8 1.8 1.2 1.0 NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) 25.2% 11.8% 7.9% 6.8% NA NATotal Principal Due 0.8 Other Available Credit 0.0 Net Income 1.7 1.0 0.7 0.6 NA NA

Total Undrawn Credit 0.0 Margin (%) 15.5% 6.5% 4.5% 4.1% NA NA

998 999 1000 2000 Diluted EPS 0.07 0.04 0.03 0.02 NA NA

VALUATION MULTIPLES



TEV / Revenue 3.0x 3.1x 0.6x 0.7x NA NA Cash from Investing (1.1) (2.3) (1.0) (0.0)

TEV / EBITDA 10.1x 14.0x 3.2x 4.2x NA NA Cash from Finaning (0.9) (0.9) (1.2) (1.0)

TEV / EBIT 11.6x 18.1x 6.8x 9.6x NA NA Change in Cash 0.7 (0.6) 0.0 0.4

P / E 6.7x 28.6x 11.7x 17.0x NA NA

P / BV 20.2x 14.7x 2.4x 2.7x NA NA Balance Sheet Latest


Total Revenue (%) 52.2% 35.1% (1.9%) 2.8% NA NA Total Liabilities 4.3 3.6 3.3 3.0

EBITDA 74.1% (8.0%) (21.7%) (11.1%) NA NA Total Equity 1.9 2.9 3.6 3.8

Net Income (58.4%) (43.7%) (31.2%) (14.0%) NA NA

EPS (58.7%) (43.6%) (31.3%) (14.0%) NA NA




Chandrasekar, Shan

Naidoo, Prakash

Chandrasekar, Jaya

Fulton, B.


Chandrasekar, Shan

Naidoo, Prakash Chandrasekar, Shan 15.7 64.15%

Chandrasekar, Jaya Total Shares Outstanding 24.4 100.00%

Buckley, Bruce

Boyle, J.

Income Statement

Cash Flow Statement


Vice President, General Manager and Director

Vice President of Programming, Director and Member of Audit Committee



Vice President, General Manager and Director

Vice President of Programming, Director and Member of Audit Committee

Director, Chairman of Audit Committee and Member of Compensation Committee

Director, Member of Audit Committee and Member of Compensation Committee

YOY Growth74%

-8%

-22%

0% 0%

(40.0%)

(20.0%)

0.0%

20.0%

40.0%

60.0%

80.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$1

$1

$2

$2

$3

$3

$4

$4

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

EBITDA TEV / EBITDA

Asian Television Network International Ltd. (TSXV:SAT) Price & Vol Chart

0.000.501.001.502.002.503.003.50

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/23/2007

12/4/2007

1/11/2008

2/22/2008

3/31/2008

5/15/2008

6/26/2008

8/1/2008

9/15/2008

10/24/2008

12/5/2008

1/15/2009

2/27/2009

4/3/2009

5/20/2009

($)

-

100

200

300

400

500

600

(000)


Valuation

$0

$1

$1

$2

$2

$3

$3

$4

$4

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

EBITDA TEV / EBITDA

Asian Television Network International Ltd. (TSXV:SAT) Price & Vol Chart

0.000.501.001.502.002.503.003.50

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/23/2007

12/4/2007

1/11/2008

2/22/2008

3/31/2008

5/15/2008

6/26/2008

8/1/2008

9/15/2008

10/24/2008

12/5/2008

1/15/2009

2/27/2009

4/3/2009

5/20/2009

($)

-

100

200

300

400

500

600

(000)


A S I A N T E L E V I S I O N N E T W O R K I N T E R N A T I O N A L L T D . T S X V : S A T

BROADCASTING

72

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


ASTRAL MEDIA INC. (TSX:ACM.A)

COMPANY INFORMATIONAstral Media, Inc. engages in the business of specialty, pay, and pay-per-view television broadcasting, radio broadcasting, and outdoor advertising in Canada. It operates in three business

segments: Television, Radio, and Outdoor Advertising. The Television segment offers specialty, pay, and pay-per-view television services in English and French languages through its 20 channels. The

Radio segment owns 83 licensed radio stations in 8 provinces including Energie, RockDetente, Virgin Radio, EZ Rock, The Mix, and The Bear. The Outdoor Advertising segment includes activities related

to posting advertising on the company’s inventory of panels and street furniture equipment. It primarily involves in outdoor advertising with approximately 7,500 advertising billboards located

in Quebec and Ontario, as well as operates approximately 100 Web sites. The company was founded in 1946 and is headquartered in Montreal, Canada.


Website http://www.astral.com Latest Fiscal Quarter 2/28/2009





52 Week High (6/17/08) 34.93 Beta 0.57

52 Week Low (12/15/08) 19.41 Float % 92.9%









TSX:ACM.A YTD 21.9%

S&P 500 YTD 4.3%998 999 1000 2000








Trust Preferred 0.0 Undrawn Revolver 160.2 Margin (%) 32.3% 32.3% 33.5% 33.3% 32.8% 33.0%Capital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT 176.3 190.7 266.8 279.2 NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) 29.6% 29.8% 30.8% 30.5% NA NATotal Principal Due 818.6 Other Available Credit 0.0 Net Income 123.5 131.2 177.0 153.5 156.9 166.8


998 999 1000 2000 Diluted EPS 2.26 2.42 3.12 2.73 2.80 2.97

VALUATION MULTIPLES



TEV / Revenue 3.3x 3.4x 3.3x 2.6x 2.7x 2.6x Cash from Investing 17.6 (134.7) (904.7) (61.2)

TEV / EBITDA 10.3x 10.4x 10.2x 7.9x 8.2x 7.8x Cash from Finaning (91.7) (42.7) 731.4 (95.1)

TEV / EBIT 11.2x 11.3x 11.0x 8.7x NA NA Change in Cash 50.8 (47.7) (24.9) 44.5

P / E 21.1x 15.7x 10.6x 10.9x 10.9x 10.3x




EBITDA 12.4% 7.3% 40.1% 27.5% 4.3% 4.0% Total Equity 959.5 1,054.7 1,346.5 1,398.3

Net Income 14.8% 6.2% 34.9% (9.0%) (11.4%) 6.3%

EPS 23.0% 7.1% 28.9% (10.2%) (10.5%) 6.3%




Greenberg, Ian Mackenzie Financial Corporation 2.0 3.58%

Agf International Advisors Company Limited 1.6 2.79%

Gagnon, Claude Phillips, Hager & North Investment Management Ltd. 1.5 2.66%

Empire Life Insurance Co., Asset Management Arm 1.2 2.21%

Parisien, Jacques Qv Investors Inc 1.1 1.99%

Ig Investment Management, Ltd. 1.0 1.70%

Roy, Pierre Burgundy Asset Management Ltd. 0.8 1.45%

Cibc Asset Management Inc. 0.8 1.43%

Selected Board Members Title Invesco Trimark Ltd 0.6 1.12%

Bureau, André Mfc Global Investment Management 0.4 0.75%

Greenberg, Ian Greenberg, Sidney 0.3 0.54%

Greenberg, Sidney Total Shares Outstanding 56.1 100.00%

Price, Timothy

Beutel, Austin

Cohon, George

Income Statement

Cash Flow Statement



Group President of Astral Media Radio and Astral Media Outdoor

President of Les Chaînes Télé Astral and President of MusiquePlus Inc

Chairman of the Board


Vice President and Non Independent Director

Lead Independent Director, Chairman of Corporate Governance & Nominating

Committee, Member of Audit Committee and Member of Compensation & Human

Independent Director and Chairman of Audit Committee

Independent Director, Chairman of Compensation & Human Resources Committee

and Member of Corporate Governance & Nominating Committee

YOY Growth

12%7%

40%

4% 4%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

EBITDA

Valuation

$0

$50

$100

$150

$200

$250

$300

$350

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

EBITDA TEV / EBITDA

Astral Media Inc. (TSX:ACM.A) Price & Vol Chart

0.00

10.00

20.00

30.00

40.00

50.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

500

1,000

1,500

2,000

2,500

(000)


A S T R A L M E D I A I N C . T S X : A C M . A

73

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


CANWEST GLOBAL COMMUNICATIONS CORP. (TSX:CGS)

COMPANY INFORMATIONCanwest Global Communications Corp. operates as a media company primarily in Canada, New Zealand, Australia, Turkey, Indonesia, Singapore, the United Kingdom, and the United States. It has

interests in conventional television, specialty television channels, out-of-home advertising, publishing, and Web sites. The company owns and operates Global Television Network, E! Network, TVtropolis,

and 5 Canadian specialty television channels, as well as other 18 Canadian specialty television channels. It also involves in the publication of various newspapers and magazines, including

metropolitan daily newspapers, the National Post, and The New Republic, as well as operation of canada.com Web portal and other Web-based operations. In addition, the company operates four radio

stations comprising Super FM, Metro FM, Joy FM, and Joy Turk FM. Further, its operations include out-of-home advertising. Additionally, the company owns and operates Ten Television Network. Canwest

Global Communications was founded in 1974 and is headquartered in Winnipeg, Canada.


Website http://www.canwestglobal.com Latest Fiscal Quarter 2/28/2009





52 Week High (6/11/08) 3.84 Beta 1.57

52 Week Low (6/01/09) 0.19 Float % 80.8%









TSX:CGS YTD (70.5%)

S&P 500 YTD 4.3%998 999 1000 2000





Term Loans 1,203.7 Adjustments 0.0

Snr Bonds and Notes 598.4 Total Debt 3,485.9 Revenue 2,685.8 2,864.2 3,146.0 3,101.0 3,022.5 3,063.1

Sub Bonds and Notes 1,244.5 EBITDA 459.4 492.0 578.4 538.5 500.5 548.7

Trust Preferred 0.0 Undrawn Revolver 1,030.7 Margin (%) 17.1% 17.2% 18.4% 17.4% 16.6% 17.9%Capital Leases 10.9 Undrawn Commercial Paper 0.0 EBIT 354.3 390.9 454.7 414.3 NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) 13.2% 13.6% 14.5% 13.4% NA NATotal Principal Due 3,485.9 Other Available Credit 0.0 Net Income 178.7 279.3 (1,040.1) (2,515.9) (68.9) (40.9)

Total Undrawn Credit 1,030.7 Margin (%) 6.7% 9.8% (33.1%) (81.1%) (2.3%) (1.3%)

998 999 1000 2000 Diluted EPS (0.05) 0.12 (5.77) (14.09) (0.39) (0.23)

VALUATION MULTIPLES



TEV / Revenue 1.6x 1.5x 1.3x 1.3x 1.4x 1.4x Cash from Investing 525.6 (1,724.6) (122.3) (118.4)

TEV / EBITDA 9.0x 8.3x 6.2x 7.7x 8.3x 7.5x Cash from Finaning (386.3) 1,303.3 (20.2) 59.1

TEV / EBIT 11.4x 10.3x 7.6x 10.0x NA NA Change in Cash 251.2 (152.2) (49.2) (5.8)

P / E NM 19.7x NM NM NA NA

P / BV 1.3x 1.0x 0.3x NM NA NA Balance Sheet Latest


Total Revenue (%) (11.4%) 6.6% 9.8% 4.0% (3.9%) 1.3% Total Liabilities 4,271.7 5,431.1 5,947.6 6,176.8

EBITDA (35.9%) 7.1% 17.6% 0.0% (13.5%) 9.6% Total Equity 1,371.1 1,663.9 567.2 (935.5)

Net Income 1650.8% 56.3% NM NM NM NM

EPS NM NM NM NM NM NM




Asper, Leonard Mfc Global Investment Management 1.1 0.59%

Norges Bank Investment Management 0.3 0.14%

Asper, David Global Pension Fund (Norway) 0.3 0.14%

Goldman Sachs Asset Management International Ltd 0.1 0.06%

Maguire, John Dimensional Fund Advisors Lp 0.1 0.06%

Gabelli Funds, Llc 0.1 0.05%

Godfrey, Paul Lincluden Management Ltd 0.1 0.04%

Aegon Capital Management, Inc. 0.0 0.02%

Selected Board Members Title Teachers Insurance And Annuity Association College Retirement Equities Fu 0.0 0.01%

Burney, Derek

Asper, Leonard Asper, David 27.4 15.43%

Asper, David Total Shares Outstanding 177.6 100.00%

Godfrey, Paul

Drybrough, David

Daniels, Ronald

Income Statement

Cash Flow Statement

Chief Executive Officer, President and Non-Independent Director

Executive Vice President, Non-independent Director, Member of Pension Committee

and Chairman of National Post


Director, Chairman of Governance & Nominating Committee, Member of Human

Resources Committee, Chief Executive Officer of National Post and President of

l

Chairman of the Board, Member of Governance & Nominating Committee and

Member of Human Resources Committee

Chief Executive Officer, President and Non-Independent Director

Executive Vice President, Non-independent Director, Member of Pension Committee

and Chairman of National Post

Director, Chairman of Governance & Nominating Committee, Member of Human

Resources Committee, Chief Executive Officer of National Post and President of

Director, Chairman of Audit Committee and Member of Governance & Nominating

Committee

Director, Chairman of Human Resources Committee and Member of Pension

Committee

YOY Growth

-36%

7%

18%

-13%

10%

(40.0%)

(30.0%)

(20.0%)

(10.0%)

0.0%

10.0%

20.0%

30.0%

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

EBITDA

Valuation

$0

$100

$200

$300

$400

$500

$600

$700

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

EBITDA TEV / EBITDA

CanWest Global Communications Corp. (TSX:CGS) Price & Vol Chart

0.002.004.006.008.0010.0012.0014.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-1,0002,0003,0004,0005,0006,0007,000

(000)


C A N W E S T G L O B A L C O M M U N I C A T I O N S C O R P. T S X : C G S

74

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


NEWFOUNDLAND CAPITAL CORP. LTD. (TSX:NCC.A)

COMPANY INFORMATIONNewfoundland Capital Corporation Limited operates as a radio broadcaster with 81 licenses in Canada. It primarily focuses on radio programming, advertising airtime sales, and networking

activities. The company reaches listeners through various formats, including television and newspapers. As of December 31, 2008, its portfolio of radio assets consisted of 55 FM and 26 AM broadcast

licenses. The company also had 4 audio streams on the Web and various cable sites in Canada. Newfoundland Capital Corporation owns and operates radio stations in Newfoundland and Labrador, New

Brunswick, Nova Scotia, Prince Edward Island, Ontario, Manitoba, and Alberta. In addition, it involves in the operation of a hotel in Corner Brook, Newfoundland and Labrador. The company was founded in

1949 and is headquartered in Dartmouth, Canada.


Website http://www.ncc.ca Latest Fiscal Quarter 3/31/2009





52 Week High (8/05/08) 20.25 Beta 0.13

52 Week Low (1/27/09) 14.00 Float % 38.1%









TSX:NCC.A YTD 17.6%

S&P 500 YTD 4.3%998 999 1000 2000









Other 0.0 Undrawn Term Loans 0.0 Margin (%) 18.6% 13.7% 5.6% 5.6% NA NATotal Principal Due 75.8 Other Available Credit 0.0 Net Income 12.0 20.3 (4.4) (4.4) 7.3 8.3

Total Undrawn Credit 6.2 Margin (%) 11.6% 20.5% (4.5%) (4.4%) 6.8% 7.7%

998 999 1000 2000 Diluted EPS 1.04 1.77 (0.40) (0.40) 0.66 0.76

VALUATION MULTIPLES




TEV / EBITDA 19.0x 42.3x 15.9x 31.2x 13.3x 12.7x Cash from Finaning (6.2) 0.0 6.9 1.5

TEV / EBIT 25.3x 91.7x 20.6x 51.8x NA NA Change in Cash 0.0 0.0 0.0 0.0

P / E 17.7x 12.9x 36.5x NM 28.8x 25.1x



Total Revenue (%) 28.6% (4.5%) (1.7%) (4.7%) 9.6% 1.7% Total Liabilities 126.8 126.3 148.0 142.7

EBITDA 49.1% (24.8%) (46.6%) (53.4%) 129.9% 4.6% Total Equity 90.9 105.0 90.7 89.7

Net Income 98.4% 69.7% NM NM NM 14.7%

EPS 101.2% 71.2% NM NM NM 14.7%




Steele, Robert Mcelvaine Investment Management Ltd. 0.6 5.33%

Seamark Asset Management Ltd. 0.1 0.91%

Weatherby, Scott Dimensional Fund Advisors Lp 0.0 0.02%

Murray, David

Murphy, John


Steele, Harry

Steele, Robert Steele, Harry 6.4 58.24%

Matheson, David Total Shares Outstanding 11.0 100.00%

Warr, Donald

MacDonald, Michael

Hébert, J.

Director and Chairman of Audit & Governance Committee

Director and Member of Audit & Governance Committee

Director and Member of Audit & Governance Committee

Honorary Director

Chief Operating Officer

President of VOCM Cares Foundation - Newfoundland and Labrador

Chairman


Income Statement

Cash Flow Statement


Chief Financial Officer and Corporate Secretary

YOY Growth

49%

-25%-47%

130%

5%

(100.0%)

(50.0%)

0.0%

50.0%

100.0%

150.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$5

$10

$15

$20

$25

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

10.0x

20.0x

30.0x

40.0x

50.0x

EBITDA TEV / EBITDA

Newfoundland Capital Corp. Ltd. (TSX:NCC.A) Price & Vol Chart

0.00

5.00

10.00

15.00

20.00

25.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/16/2007

3/29/2007

5/11/2007

6/20/2007

7/26/2007

9/13/2007

10/22/2007

11/30/2007

1/9/2008

2/19/2008

4/2/2008

5/16/2008

6/25/2008

8/5/2008

9/16/2008

10/27/2008

11/21/2008

1/16/2009

2/27/2009

4/8/2009

5/20/2009

($)

-

500

1,000

1,500

2,000

(000)


N E W F O U N D L A N D C A P I T A L C O R P. L T D . T S X : N C C . A

75

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


SCORE MEDIA INC. (TSX:SCR)

COMPANY INFORMATIONScore Media, Inc. operates as a media company in Canada. It offers The Score Television Network, a national specialty television service that provides sports news, information, highlights, and

live event programming. The company also operates Hardcore Sports Radio, a satellite radio network available in North America on SIRIUS Satellite Radio. In addition, it operates theScore.com, Score

Mobile, and Score Poker. As of August 31, 2008, Score Media provided its television services to approximately 6.4 million homes in Canada. The company was founded in 1997 and is based in

Toronto, Canada.


Website http://www.scoremedia.ca Latest Fiscal Quarter 2/28/2009





52 Week High (6/18/08) 0.95 Beta 1.10

52 Week Low (11/27/08) 0.25 Float % 8.8%









TSX:SCR YTD 27.5%

S&P 500 YTD 4.3%998 999 1000 2000











998 999 1000 2000 Diluted EPS 0.14 0.03 0.02 0.01 NA NA

VALUATION MULTIPLES




TEV / EBITDA 18.8x 30.7x 15.3x 9.5x NA NA Cash from Finaning 9.7 0.5 (5.2) 4.2

TEV / EBIT 22.0x 40.6x 32.5x 40.1x NA NA Change in Cash 11.1 0.5 (11.3) (2.1)

P / E 23.0x 15.9x 38.7x 47.5x NA NA



Total Revenue (%) 16.0% 15.3% 8.5% 10.7% NA NA Total Liabilities 13.5 12.4 10.2 12.3

EBITDA 30.1% 6.0% 4.9% 10.8% NA NA Total Equity 18.6 23.3 26.1 25.4

Net Income 373.5% (78.6%) (27.3%) (42.4%) NA NA

EPS 352.1% (80.1%) (27.5%) (41.9%) NA NA




Levy, John Cibc Asset Management Inc. 4.4 5.40%

Connor, Clark & Lunn Investment Management Ltd. 1.5 1.82%

Errington, David

Moen, Don

Cicione, Anthony


Levy, John

Levy, Benjamin Levy, John 37.1 45.77%

Scholes, Mark Total Shares Outstanding 81.2 100.00%

Read, Kenneth

Thomson, William

Zega, Mark

Director, Chairman of Human Resources & Compensation Committee, Member of

Audit Committee and Member of Nominating & Corporate Governance Committee

Director, Chairman of Nominating & Corporate Governance Committee, Member of

Human Resources & Compensation Committee and Member of Audit Committee

Director, Chairman of Audit Committee, Member of Human Resources &

Compensation Committee and Member of Nominating & Corporate Governance

Director

Vice President of Sales - The Score

Vice President of Programming and Production - The Score

Chairman and Chief Executive Officer

Senior Vice President of Score Media Ventures and Director

Income Statement

Cash Flow Statement


Senior Vice President of The Score Television Network Ltd and General Manager of The

Score Television Network Ltd

YOY Growth

30%

6% 5%

0% 0%0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

EBITDA

Valuation

$0

$1

$2

$3

$4

$5

$6

$7

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

5.0x

10.0x

15.0x

20.0x

25.0x

30.0x

35.0x

EBITDA TEV / EBITDA

Score Media Inc. (TSX:SCR) Price & Vol Chart

0.00

0.50

1.00

1.50

2.00

2.50

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/5/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/8/2009

5/20/2009

($)

-1,0002,0003,0004,0005,0006,0007,0008,000

(000)


S C O R E M E D I A T S X : S C R

76

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


TVA GROUP INC. (TSX:TVA.B)

COMPANY INFORMATIONTVA Group Inc., together with its subsidiaries, operates as a communications company primarily in North America. It operates in three segments: Television, Publishing, and Distribution. The

Television segment creates, produces, and broadcasts entertainment, information, and public affairs programming. It also provides analog and digital specialty, and commercial production and home

shopping services. This segment operates private French-language television network; seven specialty channels; an English-language general-interest television station; and a pay-per-view service. It

also holds interests in an Internet portal and specialty channel. The Publishing segment engages in publishing various French-language magazines specializing in arts, entertainment, television,

fashion, and decoration. It also offers customized publishing services for promoting trademarks through the print media. As of December 31, 2008, this segment published approximately 50 magazines.

The Distribution segment involves in televisual product and film distribution operations. It owns a catalogue of distribution rights on various media platforms, including cinema, video, pay, and

pay-per-view television, as well as specialty and conventional television. TVA Group Inc. was formerly known as Tele-Metropole Inc. and changed its name to TVA Group Inc. in February 1998. The

company was founded in 1960 and is based in Montreal, Canada. TVA Group Inc. is a subsidiary of Quebecor Media Inc.


Website http://www.tva.ca Latest Fiscal Quarter 3/31/2009





52 Week High (6/12/08) 16.24 Beta 0.90

52 Week Low (12/29/08) 4.81 Float % 48.9%









TSX:TVA.B YTD 72.1%

S&P 500 YTD 4.3%998 999 1000 2000








Trust Preferred 0.0 Undrawn Revolver 65.7 Margin (%) 2.5% 14.2% 15.1% 15.3% 16.0% 15.8%Capital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT (3.7) 46.4 52.3 53.4 NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) (0.9%) 11.2% 12.0% 12.1% NA NATotal Principal Due 94.0 Other Available Credit 0.0 Net Income (3.1) 38.4 44.8 45.8 37.8 38.3

Total Undrawn Credit 65.7 Margin (%) (0.8%) 9.2% 10.3% 10.4% 8.6% 8.7%

998 999 1000 2000 Diluted EPS (0.12) 1.42 1.77 1.87 1.58 1.60

VALUATION MULTIPLES





TEV / EBIT 20.4x 45.7x 4.1x 6.0x NA NA Change in Cash 1.2 0.3 2.0 (0.3)

P / E 21.7x 40.1x 3.0x 4.8x 5.7x 5.6x




EBITDA (80.9%) 492.8% 11.7% (0.0%) 6.2% 0.0% Total Equity 181.5 214.5 202.8 207.4

Net Income NM NM 16.7% 6.6% (15.6%) 1.3%

EPS NM NM 24.8% 17.5% (11.0%) 1.3%




Dion, Pierre Ig Investment Management, Ltd. 0.1 0.44%


Rozon, Denis

Poirier, Jocelyn

Dion, Yves


Neveu, Jean

Péladeau, Pierre Courtois, Marc 0.0 0.01%

Gouin, Serge Total Shares Outstanding 24.0 100.00%

Courtois, Marc

Dorion, Jacques

Lalande, Sylvie

Independent Director and Chairman of Compensation Committee

Independent Corporate Director and Chairman of Audit Committee

Independent Director and Member of Compensation Committee

Independent Corporate Director and Member of Compensation Committee

President of TVA Publications Inc and President of Shopping TVA

Président of TVA Films

Chairman and Chairman of Quebecor Inc

Director, Chief Executive Officer of Quebecor Inc, Chief Executive Officer of Quebecor

Media Inc and President of Quebecor Inc

Income Statement

Cash Flow Statement

Chief Executive Officer and President

Chief Financial Officer and Vice President

YOY Growth

-81%

493%

12% 6% 0%

(200.0%)

(100.0%)

0.0%

100.0%

200.0%

300.0%

400.0%

500.0%

600.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$10

$20

$30

$40

$50

$60

$70

$80

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

5.0x

10.0x

15.0x

20.0x

25.0x

EBITDA TEV / EBITDA

TVA GROUP Inc. (TSX:TVA.B) Price & Vol Chart

0.00

5.00

10.00

15.00

20.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/21/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/19/2009

($)

-

100

200

300

400

500

600

(000)


T V A G R O U P I N C . T S X : T V A . B

77

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


BROADVIEW PRESS INC. (TSXV:BDP)

COMPANY INFORMATIONBroadview Press Inc. operates as an independent academic publishing company. Its publications cover various subject areas, including English studies, philosophy, anthropology, history and

medieval studies, political science, sociology, and UTP scholarly. The company has approximately 600 titles in print. It sells its publications in the United States, Canada, and internationally.

Broadview Press Inc. was founded in 1985 and is based in Peterborough, Canada with additional offices in Guelph, Ontario, Halifax, Nova Scotia, and Calgary.

Stock Exchange TSXV Latest Fiscal Year 12/31/2008 Primary Industry Publishing

Website http://www.broadviewpress.com Latest Fiscal Quarter 3/31/2009





52 Week High (7/21/08) 0.09 Beta 0.51

52 Week Low (12/16/08) 0.02 Float % 61.2%









TSXV:BDP YTD (30.0%)

S&P 500 YTD 4.3%998 999 1000 2000







Sub Bonds and Notes 0.0 EBITDA (0.4) 0.2 (0.3) (0.1) NA NA

Trust Preferred 0.0 Undrawn Revolver 0.0 Margin (%) (9.4%) 4.7% (8.7%) (2.7%) NA NACapital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT (0.4) 0.2 (0.3) (0.1) NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) (10.9%) 3.5% (9.8%) (3.7%) NA NATotal Principal Due 0.0 Other Available Credit 0.0 Net Income (0.0) (0.1) 0.0 0.1 NA NA

Total Undrawn Credit 0.0 Margin (%) (1.1%) (1.3%) 0.0% 3.6% NA NA

998 999 1000 2000 Diluted EPS (0.00) (0.00) 0.00 0.01 NA NA

VALUATION MULTIPLES


12/31/2006 12/31/2007 12/31/2008 3/31/2009 2009E 2010E Cash from Operations (0.5) (0.1) (0.1) (0.3)


TEV / EBITDA NM NM NM NM NA NA Cash from Finaning 0.5 0.2 0.1 0.6

TEV / EBIT NM NM NM NM NA NA Change in Cash (0.0) 0.1 (0.0) 0.2

P / E 92.1x NM NM NM NA NA



Total Revenue (%) 6.7% 6.1% (26.2%) (26.3%) NA NA Total Liabilities 2.4 2.4 1.6 1.5

EBITDA NM NM NM NM NA NA Total Equity 1.6 1.8 1.8 1.6

Net Income NM NM NM NM NA NA

EPS NM NM NM NM NA NA




LePan, Donald

Richardson, Carol

Seely, Fraser

Dykstra, LeeAnna


LePan, Donald

Rhind, Ian Lepan, Donald 3.2 26.63%

Sisson, Janet Total Shares Outstanding 12.1 100.00%

Symons, Thomas

MacLaren, Roy

Bennett, Susan

Director and Member of Audit Committee

Director

Director

Director


Senior Accounts Officer

Founder, Chairman, Chief Executive Officer, President, Director of Special Projects,

Director Member of Audit Committee


Income Statement

Cash Flow Statement

Founder, Chairman, Chief Executive Officer, President, Director of Special Projects,

Director Member of Audit Committee

Chief Financial Officer and Comptroller

YOY Growth

0% 0% 0% 0% 0%0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

($1)

($0)

($0)

($0)

($0)

$0

$0

$0

$0

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

0.2x

0.4x

0.6x

0.8x

1.0x

EBITDA TEV / EBITDA

Broadview Press Inc. (TSXV:BDP) Price & Vol Chart

0.00

0.05

0.10

0.15

0.20

0.25

0.30

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/9/2007

3/26/2007

5/10/2007

6/15/2007

7/26/2007

9/5/2007

10/4/2007

11/27/2007

1/14/2008

2/7/2008

3/27/2008

5/15/2008

6/25/2008

7/24/2008

9/11/2008

10/23/2008

11/28/2008

1/14/2009

2/27/2009

3/30/2009

5/19/2009

($)

-20406080100120140

(000)


B R O A D V I E W P R E S S I N C . T S X V : B D P

PUBLISHING

78

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


FP CANADIAN NEWSPAPERS LIMITED PARTNERSHIP (TSX:FP.UN)

COMPANY INFORMATIONFP Canadian Newspapers Limited Partnership, through its subsidiaries, publishes, prints, and distributes daily and weekly newspapers and specialty publications in Canada. It also delivers

advertising materials in the Manitoba and Northwestern Ontario markets, as well as markets and provides commercial printing services. The company owns and publishes the Winnipeg Free Press and the

Brandon Sun newspapers; and operates community-based weekly newspapers, including The Lance, The Metro, The Herald, The Times, and The Headliner serving the City of Winnipeg and the municipality of

Headingly and area. It also publishes Uptown Magazine, a weekly online source for arts, entertainment, and news; and Prime Times, a twice-monthly newspaper for readers. The company’s advertising

distribution businesses deliver flyers, promotional material, and advertising samples to 290,000 households in Winnipeg and Brandon, Manitoba, and Thunder Bay. In addition, it operates

winnipegfreepress.com, a site for vehicle sales. FPCN General Partner Inc. operates as a managing general partner of FP Canadian Newspapers Limited Partnership. The company was founded in 1872 and is based

in Vancouver, Canada.


Website http://www.fpnewspapers.com Latest Fiscal Quarter 3/31/2009





52 Week High (6/09/08) 12.49 Beta 0.52

52 Week Low (3/18/09) 2.75 Float % NA









TSX:FP.UN YTD (23.6%)

S&P 500 YTD 4.3%998 999 1000 2000











998 999 1000 2000 Diluted EPS 1.30 1.94 1.15 0.00 NA NA

VALUATION MULTIPLES





TEV / EBIT 9.1x 8.4x 6.1x 8.4x NA NA Change in Cash 2.1 6.2 (2.1) (3.4)

P / E 8.0x 0.0x 0.0x 0.0x NA NA



Total Revenue (%) 4.5% 3.0% (3.8%) (6.4%) (4.8%) 1.0% Total Liabilities 133.8 130.1 131.1 129.8

EBITDA 5.8% 12.0% (18.0%) (26.6%) (22.3%) 4.4% Total Equity 20.7 23.6 19.5 16.5

Net Income 0.4% 49.0% (40.7%) (62.6%) NA NA

EPS 0.4% 49.0% (40.7%) 0.0% NA NA




Koshowski, Daniel Goodman & Company, Investment Counsel Ltd. 1.2 16.83%

Sentry Select Capital Corp. 0.7 9.99%

Cox, Robert

Finley, Laurie

Brolhorst, David


Stern, Ronald

Dembroski, G. Stern, Ronald 7.7 111.28%

Silver, Robert Total Shares Outstanding 6.9 100.00%

Redekop, H.

Secter, Harvey

Lewis, Susan

Director of FPCN General Partner Inc and Member of Audit Committee

Director of FPCN General Partner Inc

Director of FPCN General Partner Inc, Member of Audit Committee and Member of

Compensation & Corporate Governance Committee

Director of FPCN General Partner Inc

Vice President of Marketing and Advertising Sales -Winnipeg Free Press

Vice President of Production and Operations

Chairman of FPCN General Partner Inc and Member of Compensation & Corporate

Governance Committee

Director of FPCN General Partner Inc and Chairman of Audit Committee

Income Statement

Cash Flow Statement

Vice President of Finance and Administration

Publisher of Winnipeg Free Press

YOY Growth

6%

12%

-18%-22%

4%

(25.0%)

(20.0%)

(15.0%)

(10.0%)

(5.0%)

0.0%

5.0%

10.0%

15.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$5

$10

$15

$20

$25

$30

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

EBITDA TEV / EBITDA

FP Canadian Newspapers Limited Partnership (TSX:FP.UN) Price & Vol Chart

0.002.004.006.008.0010.0012.0014.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

20

40

60

80

100

(000)


F P C A N A D I A N N E W S P A P E R S L I M I T E D P A R T N E R S H I P T S X : F P. U N

79

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


GLACIER MEDIA, INC. (TSX:GVC)

COMPANY INFORMATIONGlacier Media Inc., an information communications company, provides information and related services through print, electronic, and online media in North America. The company operates through two

segments, Business and Professional Information Markets, and Newspaper and Trade Information Markets. The Business and Professional Information Markets segment publishes technical manuals that

provide legal, audit, and compliance information in the areas of environmental law, occupational health and safety, transportation, training, and business law; and develops interactive continuing

medical education programs, interactive videos, and print media packages for the health care community. It also provides investment fund related electronic and print information and analytics to

the investment community, newspapers, and media; and electronic information and report services that help real estate developers, banks, and insurance companies to identify environmental risks.

The Newspaper and Trade Information Markets segment publishes various trade magazines, online magazines, directories, and mailing lists, as well as operates a business-to-business database

marketing firm specializing in gathering and disseminating information to clients. It also publishes paid circulation farm publication, and various supplements and guides that provide information in the

areas of farm, canola and pulse crops production, buyers, and seed, as well as serves as a publisher for various industry suppliers. This segment also publishes farm business magazines,

periodicals, and regional newspapers; and prints community and daily newspapers, and related publications. The company, formerly known as Glacier Ventures International Corp., was founded in 1988 and is

headquartered in Vancouver, Canada.


Website http://www.glacierventures.com Latest Fiscal Quarter 3/31/2009





52 Week High (6/05/08) 4.25 Beta 0.95

52 Week Low (2/24/09) 1.49 Float % 66.5%









TSX:GVC YTD (14.9%)

S&P 500 YTD 4.3%998 999 1000 2000











998 999 1000 2000 Diluted EPS 0.18 0.33 0.30 0.24 0.26 0.30

VALUATION MULTIPLES




TEV / EBITDA 15.1x 11.6x 6.0x 6.5x 7.5x 6.6x Cash from Finaning 186.4 (23.8) (5.5) (14.2)


P / E 14.7x 21.2x 5.4x 7.5x 7.2x 6.3x



Total Revenue (%) 197.5% 16.2% 15.1% 10.5% (7.4%) 1.9% Total Liabilities 238.9 200.1 221.4 215.4

EBITDA 215.1% 31.7% 8.6% (7.4%) (21.0%) 12.1% Total Equity 237.8 269.8 297.5 300.0

Net Income 143.5% 135.7% (7.6%) (33.6%) (15.2%) 14.7%

EPS 10.8% 86.5% (7.3%) (33.2%) (14.9%) 14.7%




Kennedy, Jonathon Montrusco Bolton Investments Inc. 9.5 10.24%

Qv Investors Inc 4.9 5.32%

Smysnuik, Orest Chou Associates Management Inc. 1.2 1.30%


Heming, S. Pembroke Management Ltd. 0.2 0.24%

Industrial Alliance Investment Management Inc. 0.2 0.23%

Aunger, Bruce Cinnamon Investments Limited 0.2 0.19%



Grippo, Sam

Kennedy, Jonathon Kennedy, Jonathon 0.4 0.43%

Heming, S. Total Shares Outstanding 92.9 100.00%

Aunger, Bruce

Scott, Geoffrey

Hayward, Brian

Income Statement

Cash Flow Statement

Chief Executive Officer, President, Director, Member of Governance Committee and

Member of Nominating Committee


Director and President of the Specialty Technical Publishers

Secretary, Independent Director, Member of Audit Committee, Member of

Governance Committee and Member of Nominating Committee

Chairman, Chairman of Pension Committee and Chairman of Executive Compensation

& Human Resources Committee

Chief Executive Officer, President, Director, Member of Governance Committee and


Director and President of the Specialty Technical Publishers

Secretary, Independent Director, Member of Audit Committee, Member of

Governance Committee and Member of Nominating Committee

Independent Director, Member of Audit Committee, Member of Executive

Compensation & Human Resources Committee, Member of Nominating Committee

Independent Director and Member of Governance Committee

YOY Growth215%

32%9%

-21%

12%

(50.0%)

0.0%

50.0%

100.0%

150.0%

200.0%

250.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$10

$20

$30

$40

$50

$60

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

7.0x

8.0x

EBITDA TEV / EBITDA

Glacier Media, Inc. (TSX:GVC) Price & Vol Chart

0.00

1.00

2.00

3.00

4.00

5.00

6.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/10/2007

6/22/2007

8/3/2007

9/13/2007

10/23/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-2004006008001,0001,2001,4001,600

(000)


G L A C I E R M E D I A , I N C . T S X : G V C

80

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


81

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

LINGO MEDIA CORPORATION (TSXV:LM)

COMPANY INFORMATIONLingo Media Corporation operates as a diversified education products and services corporation. The company, through its wholly owned subsidiary, Speak2Me, Inc., a new media company, focuses on

interactive advertising via its Internet-based English language learning portal in China. Speak2Me offers a proprietary online service designed to address the need for conversational English

learning worldwide. It provides approximately 250-targeted language lesson modules involving interactive conversations with a virtual teacher. Lingo Media, through its other subsidiary, Lingo Learning,

Inc., publishes English language learning programs in China. As of November 4, 2008, it has published 244 million units from its library of approximately 300 program titles in China. In

addition, the company focuses on early childhood cognitive development, through its subsidiary A+ Child Development, Ltd., which distributes educational materials along with its curriculum in Canada. It

plans to introduce A+’s learning system and products to parents of pre-school children in China. Lingo Media is headquartered in Toronto, Canada.


Website http://www.lingomedia.com Latest Fiscal Quarter 3/31/2009





52 Week High (6/17/08) 1.97 Beta NA

52 Week Low (12/30/08) 0.55 Float % 77.8%









TSXV:LM YTD (11.8%)

S&P 500 YTD 4.3%998 999 1000 2000







Sub Bonds and Notes 0.0 EBITDA (0.4) (0.4) (1.7) (1.8) NA NA

Trust Preferred 0.0 Undrawn Revolver 0.0 Margin (%) (48.6%) (49.5%) (173.5%) (173.1%) NA NACapital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT (0.5) (0.4) (1.7) (1.8) NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) (55.8%) (51.1%) (175.7%) (174.6%) NA NATotal Principal Due 0.0 Other Available Credit 0.0 Net Income (0.7) (0.9) (3.9) (3.5) NA NA

Total Undrawn Credit 0.0 Margin (%) (83.8%) (105.2%) (400.7%) (344.9%) NA NA

998 999 1000 2000 Diluted EPS (0.17) (0.11) (0.22) (0.21) NA NA

VALUATION MULTIPLES



TEV / Revenue 0.0x 0.0x 4.0x 12.0x NA NA Cash from Investing (0.2) 1.1 (0.9) (0.8)

TEV / EBITDA 0.0x 0.0x NM NM NA NA Cash from Finaning 0.3 0.3 4.0 4.0

TEV / EBIT 0.0x 0.0x NM NM NA NA Change in Cash (0.0) 0.3 1.9 1.1

P / E 0.0x 0.0x NM NM NA NA



Total Revenue (%) (1.4%) (1.6%) 10.2% 383.0% NA NA Total Liabilities 1.5 2.3 1.9 1.3







Kraft, Michael U.S. Global Investors, Inc. 0.0 0.18%

Qureshi, Khurram


Kraft, Michael

Joshi, Sanjay

Flannery, Nereida Total Shares Outstanding 12.9 100.00%

Remborg, Scott

Lacavera, Anthony

Halim, Ashraf

Director


Director and Member of Compensation Committee

Director

Chief Executive Officer, President, Director, Member of Audit Committee, Member of

Compensation Committee and Member of Corporate Governance Committee

Director, Chairman of Audit Committee and Chairman of Corporate Governance

Committee

Income Statement

Cash Flow Statement

Chief Executive Officer, President, Director, Member of Audit Committee, Member of

Compensation Committee and Member of Corporate Governance Committee

Chief Financial Officer, Secretary and Treasurer

YOY Growth

0% 0% 0% 0% 0%0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

($2)

($2)

($1)

($1)

$0

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

0.2x

0.4x

0.6x

0.8x

1.0x

EBITDA TEV / EBITDA

Lingo Media Corporation (TSXV:LM) Price & Vol Chart

0.00

0.50

1.00

1.50

2.00

2.50

0 0 0 0 0 0 0 0 0 0

10/24/2007

12/4/2007

1/11/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/4/2008

1/15/2009

2/27/2009

4/8/2009

5/19/2009

($)

-102030405060708090

(000)


L I N G O M E D I A C O R P O R A T I O N T S X V : L M


82

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

MCGRAW-HILL RYERSON LTD. (TSX:MHR)

COMPANY INFORMATIONMcGraw-Hill Ryerson Limited publishes and distributes educational and professional products in print and non-print media in Canada. Its product offerings include text and professional reference

books; multimedia tools; and teaching, assessment, support, and monitoring solutions. The company operates in three divisions: Higher Education, School, and Professional. The Higher Education

division offers various programs in the fields of business and economics, science, humanities and social sciences, computer and information technologies, and e-services. It serves post-secondary

education institutions, such as universities, community colleges, and career colleges. The School division provides various programs in the areas, including mathematics, science and health, social

studies, literacy, English, social sciences, and technology education. It serves secondary and elementary schools. The Professional division offers various programs in the areas of business,

medical, technical, general interest, language, and education. It serves retailers, wholesalers, libraries, and professionals. The company was founded in 1944 and is headquartered in Whitby, Canada.

McGraw-Hill Ryerson Limited is a subsidiary of The McGraw-Hill Companies, Inc.


Website http://www.mcgrawhill.ca Latest Fiscal Quarter 3/31/2009





52 Week High (6/09/08) 45.00 Beta (0.01)

52 Week Low (4/06/09) 33.25 Float % 29.7%









TSX:MHR YTD (5.1%)

S&P 500 YTD 4.3%998 999 1000 2000











998 999 1000 2000 Diluted EPS 2.97 4.99 5.26 5.16 NA NA

VALUATION MULTIPLES





TEV / EBIT 6.5x 4.7x 3.2x 3.1x NA NA Change in Cash 6.3 2.1 8.2 (3.9)

P / E 13.9x 9.4x 8.2x 7.2x NA NA



Total Revenue (%) 5.5% (0.0%) 2.2% 2.7% NA NA Total Liabilities 23.3 19.2 32.8 12.6

EBITDA 7.0% 61.3% (2.9%) (8.1%) NA NA Total Equity 73.2 75.4 70.1 66.9

Net Income 15.6% 68.1% 5.4% (1.6%) NA NA

EPS 15.6% 68.1% 5.4% (1.6%) NA NA




Swail, David Mawer Investment Management Ltd. 0.0 1.69%

Howson Tattersall Investment Counsel 0.0 0.93%

Dyer, Gordon Cinnamon Investments Limited 0.0 0.33%

Hsbc Global Asset Management (Canada) Limited 0.0 0.23%

Gerrish, Nancy

Ferrier, Patrick


Macdonald, H.

Swail, David Swail, David 0.0 0.17%

Kranenburg, Hendrik Total Shares Outstanding 2.0 100.00%

Kane, Kevin

Bahash, Robert

DesLauriers, J.

Director, Chairman of Compensation Committee, Member of Human Resources

Committee, Member of Executive Committee and President of McGraw-Hill's Higher

Director, Member of Corporate Governance and Nominating Committee and

President of Business & Economics Higher Education Group of The McGraw Hill

Director, Member of Finance Committee, Chief Financial Officer of The McGraw-Hill

Companies Inc and Executive Vice President of The McGraw-Hill Companies Inc

Independent Director, Chairman of Human Resources Committee, Member of

Compensation Committee and Member of Executive Committee

President of School Division

President of Higher Education Division

Chairman of the Board, Chairman of the Finance Committee, Member of Audit

Committee, Member of Compensation Committee, Member of the Corporate

fChief Executive Officer, President, Director, Member of Executive Committee and

Member of Finance Committee

Income Statement

Cash Flow Statement

Chief Executive Officer, President, Director, Member of Executive Committee and

Member of Finance Committee

Chief Financial Officer, Executive Vice President, Secretary and Treasurer

YOY Growth

7%

61%

-3%

0% 0%

(10.0%)

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$5

$10

$15

$20

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

7.0x

EBITDA TEV / EBITDA

McGraw-Hill Ryerson Ltd. (TSX:MHR) Price & Vol Chart

0.0010.0020.0030.0040.0050.0060.0070.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/1/2007

3/16/2007

5/10/2007

6/20/2007

8/3/2007

9/13/2007

10/24/2007

11/27/2007

1/9/2008

2/22/2008

4/4/2008

5/16/2008

6/23/2008

7/23/2008

9/12/2008

10/15/2008

12/3/2008

1/9/2009

2/10/2009

4/8/2009

5/20/2009

($)

-1020304050607080

(000)


M C G R A W H I L L R Y E R S O N L T D . T S X : M H R


MPL COMMUNICATIONS INC. (TSXV:MPZ)

COMPANY INFORMATIONMPL Communications Inc. engages in the publication of printed periodicals and electronic information services primarily in Canada. It publishes nine investment advisory newsletters; an investment

newspaper published twice monthly; an investment advisory Web site; and an online equity research service. The company also publishes two non-financial newsletters for health and dental

professionals. Its publications include The Investment Reporter, Investor’s Digest of Canada, The MoneyLetter, the Canadian Mutual Fund Adviser, the Money Reporter, The FundLetter, The TaxLetter, and

Blue Book of Stock Reports. The company was founded in 1941 and is based in Toronto, Canada.


Website http://www.adviceforinvestors.comLatest Fiscal Quarter 12/31/2008





52 Week High (3/07/08) 0.10 Beta (0.13)

52 Week Low (11/14/08) 0.02 Float % 42.1%






Less: Cash and ST Investments 0.0 Last 3 Months 0.0



TSXV:MPZ YTD 0.0%

S&P 500 YTD 4.3%998 999 1000 2000







Sub Bonds and Notes 0.0 EBITDA (0.0) 0.3 0.3 0.3 NA NA

Trust Preferred 0.0 Undrawn Revolver 0.0 Margin (%) (0.7%) 4.3% 4.9% 4.9% NA NACapital Leases 0.1 Undrawn Commercial Paper 0.0 EBIT (0.1) 0.2 0.2 0.2 NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) (1.8%) 3.0% 3.7% 3.7% NA NATotal Principal Due 0.2 Other Available Credit 0.0 Net Income (0.1) 0.3 (1.1) (1.1) NA NA

Total Undrawn Credit 0.0 Margin (%) (1.7%) 4.7% (19.7%) (19.7%) NA NA

998 999 1000 2000 Diluted EPS (0.01) 0.02 (0.06) (0.06) NA NA

VALUATION MULTIPLES



TEV / Revenue 0.2x 0.2x 0.1x 0.1x NA NA Cash from Investing 0.0 (0.0) (0.0) (0.0)

TEV / EBITDA 2.7x 2.2x 2.0x 2.1x NA NA Cash from Finaning (0.0) 0.2 0.2 0.2

TEV / EBIT 3.3x 2.6x 3.2x 2.8x NA NA Change in Cash (0.2) (0.1) (0.0) (0.0)

P / E 10.4x 26.7x 5.1x NM NA NA



Total Revenue (%) 2.7% (2.1%) (12.7%) (12.7%) NA NA Total Liabilities 7.8 7.3 7.2 7.2

EBITDA NM NM (0.2%) (0.2%) NA NA Total Equity 0.2 0.5 (0.6) (0.6)






Martland, Barrie


Pepper, Stephen

Martland, Barrie Martland, Barrie 2.5 13.42%

Goth, Lynn Total Shares Outstanding 18.9 100.00%

Ash, Allie

Scott, William

Carlson, David


Independent Director, Member of Special Independent Committee and Member of

Audit Committee

Director, Member of Special Independent Committee and Member of Compensation

Committee

Director Nominee

Chairman and Member of Audit Committee

President, Director and Member of Compensation Committee

Income Statement

Cash Flow Statement

President, Director and Member of Compensation Committee

YOY Growth0% 0%

0%

0% 0%

(0.2%)

(0.2%)

(0.1%)

(0.1%)

0.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

($0)($0)$0$0$0$0$0$0$0$0

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

0.5x

1.0x

1.5x

2.0x

2.5x

3.0x

EBITDA TEV / EBITDA

MPL Communications Inc. (TSXV:MPZ) Price & Vol Chart

0.00

0.02

0.04

0.06

0.08

0.10

0.12

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/6/2007

3/27/2007

5/10/2007

6/22/2007

7/18/2007

9/6/2007

10/5/2007

11/30/2007

1/9/2008

2/20/2008

3/24/2008

5/5/2008

6/17/2008

6/17/2008

8/29/2008

10/15/2008

11/26/2008

12/19/2008

2/23/2009

2/23/2009

5/8/2009

($)

-20406080100120140

(000)


M P L C O M M U N I C A T I O N S I N C . T S X V : M P Z

83

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


MULTIMEDIA NOVA CORP. (TSXV:MNC.A)

COMPANY INFORMATIONMultimedia Nova Corporation, a communications company, together with its subsidiaries, engages in publishing, multicultural marketing, printing, and distribution operations in Canada and

internationally. It publishes various newspapers in Italian, English, Portuguese, and Spanish. The company provides editorial, production, contract printing, distribution, promotional, and administrative

services to its customers. It owns the masthead of Corriere Canadese, an Italian daily newspaper; and Tandem, the cosmopolitan newsweekly, as well as prints and distributes the Canadian edition

of La Repubblica, a daily newspaper in Rome. Multimedia Nova Corporation also publishes daily newspapers, such as Town Crier, Vaughan Today, Nove Ilhas, and Insieme. In addition, the company

offers newspaper printing and distribution services to third parties. Further, it offers online versions of its print products, guides, business directories, and interactive features through

Corriere.com, CorriereTandem.com, TownCrierOnline.ca, and ElCorreo.ca. Multimedia Nova Corporation is based in Toronto, Canada.


Website http://www.multimedianova.com Latest Fiscal Quarter 12/31/2008





52 Week High (7/08/08) 0.50 Beta 0.94

52 Week Low (4/08/09) 0.03 Float % 47.4%









TSXV:MNC.A YTD (76.0%)

S&P 500 YTD 4.3%998 999 1000 2000








Trust Preferred 0.0 Undrawn Revolver 0.0 Margin (%) 8.9% 7.5% 1.2% 5.5% NA NACapital Leases 0.5 Undrawn Commercial Paper 0.0 EBIT 0.7 0.5 (0.3) 0.3 NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) 5.2% 3.8% (2.1%) 2.1% NA NATotal Principal Due 8.2 Other Available Credit 0.0 Net Income 0.1 (1.1) (0.9) (1.8) NA NA

Total Undrawn Credit 0.0 Margin (%) 0.4% (8.4%) (5.8%) (11.6%) NA NA

998 999 1000 2000 Diluted EPS 0.01 (0.19) (0.15) (0.24) NA NA

VALUATION MULTIPLES


3/31/2006 3/31/2007 3/31/2008 12/31/2008 2009E 2010E Cash from Operations (0.9) 0.8 (0.4) (0.2)


TEV / EBITDA 6.8x 4.9x NM 12.8x NA NA Cash from Finaning 1.2 0.0 1.3 1.1

TEV / EBIT 12.5x 7.0x NM 33.9x NA NA Change in Cash 0.1 0.1 0.1 0.0





EBITDA 5.1% (15.6%) (81.1%) NM NA NA Total Equity 2.7 1.8 1.0 0.2






Abittan, Lori

Mastrogiacomo, Joseph

Iannuzzi, Doreen


Abittan, Lori

Iannuzzi, Doreen Iannuzzi, Doreen 0.6 7.41%

Jarvis, Guy Total Shares Outstanding 7.8 100.00%

Gossage, C.

Bruce, John



Director

Vice-President of New Media Sales and Director

Chief Executive Officer, President, Publisher, Director and Member of Audit Committee

Vice-President of New Media Sales and Director

Income Statement

Cash Flow Statement

Chief Executive Officer, President, Publisher, Director and Member of Audit Committee

Chief Financial Officer and Secretary

YOY Growth5%

-16%

-81%

0% 0%

(100.0%)

(80.0%)

(60.0%)

(40.0%)

(20.0%)

0.0%

20.0%

3/31/2006 3/31/2007 3/31/2008 2009E 2010E

EBITDA

Valuation

$0

$0

$0

$1

$1

$1

$1

$1

3/31/2006 3/31/2007 3/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

7.0x

8.0x

EBITDA TEV / EBITDA

Multimedia Nova Corp. (TSXV:MNC.A) Price & Vol Chart

0.000.100.200.300.400.500.600.70

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/13/2007

2/13/2007

5/10/2007

6/14/2007

7/19/2007

8/16/2007

10/4/2007

10/4/2007

10/4/2007 0

3/26/2008

5/9/2008

6/23/2008

7/8/2008

7/8/2008

7/8/2008

11/10/2008

11/10/2008

2/5/2009

4/8/2009

4/21/2009

($)

-

10

20

30

40

50

60

(000)


M U L T I M E D I A N O V A C O R P. T S X V : M N C . A

84

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


THOMSON REUTERS CORPORATION (TSX:TRI)

COMPANY INFORMATIONThomson Reuters Corporation provides intelligent information for businesses and professionals in the financial, legal, tax and accounting, healthcare, science, and media markets worldwide. It

operates in two divisions, Markets and Professional. The Markets division offers sales and trading services comprising information, trading, and post-trade connectivity requirements of buy-side and

sell-side clients in foreign exchange, fixed income, equities, exchange-traded instruments, and commodities and energy markets; and enterprise information products, including instrument prices,

price histories, tick-by-tick trading data, evaluated pricing, terms and conditions, corporate actions, and analytics for financial institutions. This division also provides investment and

advisory services, such as analytics, content, and workflow tools, including fundamentals, estimates, economics, broker research, fixed income, and deal and mutual fund data for financial

decision-making, performance, and efficiency; and media services, which comprise news and information services for media and business professionals. The Professional division provides critical information, and

decision support tools and services to legal, intellectual property, compliance, and business and government professionals; and technology and information solutions, and integrated tax

compliance software and services to accounting, tax, and corporate finance professionals. This segment also offers content and technologies to assist in various stages of the research and development

cycle for academic, government, corporate, and pharmaceutical research and development professionals; and decision support solutions for organizations in the healthcare industry. The company was

formerly known as The Thomson Corporation and changed its name to Thomson Reuters Corporation as a result of the acquisition of Reuters in April 2008. Thomson Reuters Corporation was founded in 1977

and is headquartered in New York, New York.


Website http://www.thomsonreuters.com Latest Fiscal Quarter 3/31/2009





52 Week High (8/11/08) 37.91 Beta 0.37

52 Week Low (11/21/08) 24.83 Float % 99.8%






Less: Cash and ST Investments (1,251.0) Last 3 Months 1.2



TSX:TRI YTD (4.0%)

S&P 500 YTD 4.3%998 999 1000 2000







Sub Bonds and Notes 0.0 EBITDA 1,686.0 1,763.0 2,655.0 3,029.0 3,261.5 3,655.7

Trust Preferred 0.0 Undrawn Revolver 2,500.0 Margin (%) 25.6% 24.2% 22.7% 23.3% 25.1% 28.1%Capital Leases 35.0 Undrawn Commercial Paper 0.0 EBIT 1,248.0 1,297.0 1,834.0 2,019.0 NA NA

Other 88.0 Undrawn Term Loans 0.0 Margin (%) 18.9% 17.8% 15.7% 15.5% NA NATotal Principal Due 7,554.0 Other Available Credit 0.0 Net Income 1,120.0 4,004.0 1,405.0 1,439.0 1,419.4 1,694.6

Total Undrawn Credit 2,500.0 Margin (%) 17.0% 54.9% 12.0% 11.1% 10.9% 13.0%

998 999 1000 2000 Diluted EPS 1.41 1.69 1.81 1.74 1.71 2.05

VALUATION MULTIPLES


12/31/2006 12/31/2007 12/31/2008 3/31/2009 2009E 2010E Cash from Operations 2,125.0 1,816.0 2,761.0 2,728.0

TEV / Revenue 3.5x 3.1x 2.3x 2.3x 2.6x 2.6x Cash from Investing (1,290.0) 5,883.0 (9,262.0) (9,310.0)

TEV / EBITDA 13.0x 10.6x 13.7x 9.7x 10.4x 9.3x Cash from Finaning (912.0) (464.0) (114.0) (1,256.0)

TEV / EBIT 19.9x 16.2x 20.2x 14.6x NA NA Change in Cash (73.0) 7,163.0 (6,656.0) (7,971.0)

P / E 28.3x 23.9x 29.9x 15.6x 18.4x 15.4x



Total Revenue (%) 7.3% 10.7% 60.5% 74.2% 11.1% 0.1% Total Liabilities 9,661.0 9,260.0 15,894.0 16,139.0

EBITDA (7.1%) 4.6% 50.6% 72.1% 22.8% 12.1% Total Equity 10,481.0 13,571.0 20,126.0 19,604.0

Net Income 19.9% 257.5% (64.9%) (63.8%) 1.0% 19.4%

EPS 41.6% 19.8% 6.8% 4.5% (5.2%) 19.4%




Beattie, W. The Woodbridge Company Limited 438.4 52.91%


Daleo, Robert Rbc Asset Management Inc. 20.4 2.46%

Mackenzie Financial Corporation 16.2 1.96%

Tory, John Mclean Budden Limited 13.2 1.60%

Valueact Capital, Llc 10.9 1.32%

Opperman, Vance Jones Heward Investment Counsel Inc. 8.7 1.06%

Ig Investment Management, Ltd. 8.3 1.00%

Selected Board Members Title Bmo Harris Investment Management Inc 8.0 0.96%

Rose, Frederic Gwl Investment Management Ltd. 7.0 0.85%

Beattie, W. Glocer, Thomas 0.8 0.10%

FitzGerald, Niall Total Shares Outstanding 828.6 100.00%

Sautter, Rémy

Thomson, David

Harrington, Richard

Deputy Chairman, Chairman of Corporate Governance Committee and Member of

Human Resources Committee

Vice Chairman and Chairman of Remuneration Committee

Director and Chairman of Woodbridge Company Limited

Chairman of Thomson Reuters Foundation

Director, Member of Human Resources Committee, President of Thomson

Investments and Director of Woodbridge Company Limited

Director, Member of Audit Committee, Chief Executive Officer of Key Investment Inc

and President of Key Investment Inc


Deputy Chairman, Member of Corporate Governance Committee, Member of Human

Resources Committee and President of Woodbridge Company Limited

Income Statement

Cash Flow Statement

Deputy Chairman, Member of Corporate Governance Committee, Member of Human

Resources Committee and President of Woodbridge Company Limited

Chief Financial Officer and Executive Vice President

YOY Growth

-7%

5%

51%

23%

12%

(10.0%)

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

EBITDA TEV / EBITDA

Thomson Reuters Corporation (TSX:TRI) Price & Vol Chart

0.00

10.00

20.00

30.00

40.00

50.00

60.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

2,000

4,000

6,000

8,000

10,000

12,000

(000)


T H O M S O N R E U T E R S C O R P O R A T I O N T S X : T R I

85

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


TORSTAR CORPORATION (TSX:TS.B)

COMPANY INFORMATIONTorstar Corporation operates as a media company primarily in Canada, the United States, the United Kingdom, Japan, Germany, Australia, Sweden, and France. The company publishes the Toronto Star,

its flagship newspaper; thestar.com, an online newspaper; Metro, a free daily newspaper; Sing Tao Daily, a Chinese language newspaper; Eye Weekly, a weekly informative entertainment resource;

Real Estate News, a real estate book; Sway Magazine; The Canadian Immigrant, a magazine; and Desi-Life, a glossy magazine. Its media business also includes Torstar Syndication Services, which

provides services to publishers, companies, governments, and consumers by collecting, packaging, marketing, licensing, and distributing content; InsuranceHotline.com, an online quoting service that

directs consumers to insurance companies, which offer auto, home, and life insurance rates; Workopolis that provides Internet recruitment and job search solutions; and Olive Canada Network, an

advertising network. In addition, Torstar Corporation offers toronto.com, a local search site; Wheels.ca, a database for vehicles; Shopalot.ca, an e-commerce site; and OurFaves, a local services site

on the subject of what’s great in the city. Further, the company publishes three daily newspapers, including The Hamilton Spectator, The Record, and The Guelph Mercury; approximately 100

community newspapers; books for women comprising Harlequin, Silhouette, MIRA Books, Red Dress Ink, LUNA Books, HQN Books, Steeple Hill Books, Steeple Hill Cafe, Kimani Press, Spice, and Harlequin Ginger

Blossom; Gold Book Directories; and specialty publications. Additionally, it operates consumer shows; engages in commercial printing; and operates Transit TV, which develops, installs, services,

and manages digital out-of-home advertising networks. Torstar Corporation was founded in 1892 and is based in Toronto, Canada.


Website http://www.torstar.com Latest Fiscal Quarter 3/31/2009





52 Week High (8/19/08) 15.73 Beta 0.62

52 Week Low (3/04/09) 3.93 Float % 86.8%









TSX:TS.B YTD (42.4%)

S&P 500 YTD 4.3%998 999 1000 2000






Snr Bonds and Notes 100.0 Total Debt 673.1 Revenue 1,528.3 1,546.5 1,536.0 1,523.8 1,490.9 1,491.5



Other 0.0 Undrawn Term Loans 0.0 Margin (%) 9.5% 11.0% 10.1% 9.3% NA NATotal Principal Due 669.8 Other Available Credit 0.0 Net Income 79.1 101.4 (180.5) (198.8) 62.3 78.2

Total Undrawn Credit 115.3 Margin (%) 5.2% 6.6% (11.7%) (13.0%) 4.2% 5.2%

998 999 1000 2000 Diluted EPS 1.01 1.29 (2.29) (2.54) 0.79 0.99

VALUATION MULTIPLES





TEV / EBIT 13.9x 11.5x 7.1x NM NA NA Change in Cash 2.8 (13.4) 10.9 (5.6)

P / E 19.0x 16.4x 8.5x NM 6.4x 5.1x



Total Revenue (%) (1.8%) 1.2% (0.7%) 0.2% (2.9%) 0.0% Total Liabilities 1,128.7 1,043.1 1,115.0 1,071.9

EBITDA (20.3%) 11.5% (6.8%) (8.7%) (15.1%) 5.1% Total Equity 872.7 917.8 672.6 635.1

Net Income (33.4%) 28.1% NM NM NM 25.5%

EPS (33.2%) 27.6% NM NM NM 25.5%




Holland, David The Campbell Group, Llc 1.5 1.85%

Thall Investments Inc. 1.5 1.85%

Hayes, Donna Burgundy Asset Management Ltd. 1.1 1.38%


Strolight, Tomer Global Pension Fund (Norway) 0.2 0.27%

Td Asset Management, Inc. 0.2 0.20%

Pike, Jagoda Dimensional Fund Advisors Lp 0.1 0.14%

Grantham, Mayo, Van Otterloo & Co. Llc 0.1 0.10%

Selected Board Members Title Teachers Insurance And Annuity Association College Retirement Equities Fu 0.0 0.05%

Honderich, John Cibc Asset Management Inc. 0.0 0.04%

Holland, David Harvey, Campbell 4.5 5.68%

Samji, Alnasir Total Shares Outstanding 79.0 100.00%

Harvey, Campbell

Thall, Martin

Babick, Don

Director, Chairman of Pension Committee and Member of Audit Committee

Director, Member of Audit Committee, Member of Toronto Star Advisory Committee

and Member of Nominating & Corporate Governance Committee

Corporate Director, Member of Audit Committee and Member of Salary &

Organization Committee

Director, Member of Salary & Organization Committee and Member of Toronto Star

Advisory Committee

President of Torstar Digital

President of Star Media Group and Publisher of The Toronto Star

Chairamn, Chairman of Toronto Star Advisory Committee, Member of Pension

Committee, Member of Salary & Organization Committee, Member of Nominating &

fChief Executive Officer, Interim President, Chief Financial Officer and Executive Vice

President

Income Statement

Cash Flow Statement

Chief Executive Officer, Interim President, Chief Financial Officer and Executive Vice

President

Chief Executive Officer of Harlequin Enterprises Limited, President of Harlequin

Enterprises Limited and Publisher of Harlequin Enterprises Limited

YOY Growth

-20%

12%

-7%

-15%

5%

(25.0%)

(20.0%)

(15.0%)

(10.0%)

(5.0%)

0.0%

5.0%

10.0%

15.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$50

$100

$150

$200

$250

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

EBITDA TEV / EBITDA

Torstar Corporation (TSX:TS.B) Price & Vol Chart

0.00

5.00

10.00

15.00

20.00

25.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-1,0002,0003,0004,0005,0006,0007,0008,000

(000)


T O R S T A R C O R P O R A T I O N T S X : T S . B

86

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


TRANSCONTINENTAL INC. (TSX:TCL.A)

COMPANY INFORMATIONTranscontinental, Inc. engages in the provision of printing, publishing, and marketing services in North America. The company primarily involves in the printing of news papers, flyers and

inserts, magazines and catalogues, textbooks, road maps and atlases, posters, brochures, programs, annual reports, and booklets; and publishes community newspapers, consumer magazines, business

publications, and trade publications, as well as entertainment, sports, and leisure publications. It also offers direct marketing services ranging from design and data analysis to fulfillment, Web site

applications, and loyalty programs; produces direct marketing items; and distributes door-to-door advertising material, as well as provides various Web services, such as digital photos, remote

proofing, remote color management, and image storage. The company, formerly known as G.T.C. Transcontinental Group, Ltd., was founded in 1978 and is based in Montreal, Canada.

Stock Exchange TSX Latest Fiscal Year 10/31/2008 Primary Industry Commercial Printing

Website http://www.transcontinental-gtc.cLatest Fiscal Quarter 1/31/2009





52 Week High (6/06/08) 18.19 Beta 0.76

52 Week Low (3/09/09) 5.42 Float % 83.0%









TSX:TCL.A YTD (17.1%)

S&P 500 YTD 4.3%998 999 1000 2000









Other 0.0 Undrawn Term Loans 0.0 Margin (%) 9.9% 9.8% 9.7% 8.6% NA NATotal Principal Due 799.0 Other Available Credit 0.0 Net Income 135.8 120.6 7.9 (32.6) 113.4 118.9

Total Undrawn Credit 153.5 Margin (%) 6.0% 5.2% 0.3% (1.3%) 4.6% 4.7%

998 999 1000 2000 Diluted EPS 1.55 1.42 0.10 (0.40) 1.40 1.47

VALUATION MULTIPLES





TEV / EBIT 9.2x 9.6x 7.2x 7.1x NA NA Change in Cash (132.7) (40.8) 42.2 (8.0)

P / E 13.0x 13.3x 7.2x NM 5.7x 5.4x




EBITDA (8.0%) 2.5% 4.2% (5.9%) (8.0%) 6.3% Total Equity 1,137.6 1,177.6 1,106.6 1,083.3

Net Income (2.2%) (11.2%) (93.4%) NM 1335.6% 4.8%

EPS 0.1% (8.7%) (93.2%) NM 1353.7% 4.8%




Marcoux, Rémi Mackenzie Financial Corporation 19.0 23.58%

Qv Investors Inc 2.6 3.19%

Olivier, François Mfc Global Investment Management 1.9 2.35%


Huard, Benoit Howson Tattersall Investment Counsel 1.2 1.48%


Lariviere, Natalie Td Asset Management, Inc. 0.9 1.11%


Selected Board Members Title Burgundy Asset Management Ltd. 0.6 0.69%

Marcoux, Rémi Cibc Asset Management Inc. 0.5 0.60%

Olivier, François Marcoux, Rémi 13.2 16.35%

Marcoux, Isabelle Total Shares Outstanding 80.8 100.00%

Marcoux, Pierre

Fortin, Richard

Bouchard, Lucien

Vice Chair of the Board and Vice President of Corporate Development

Vice President of Business Publications and Director


Independent Director and Chairman of Corporate Governance Committee


President of Media Sector

Founder and Executive Chairman

Chief Executive Officer, President and Non-independent Director

Income Statement

Cash Flow Statement

Founder and Executive Chairman

Chief Executive Officer, President and Non-independent Director

YOY Growth

-8%

3%4%

-8%

6%

(10.0%)(8.0%)(6.0%)(4.0%)(2.0%)0.0%2.0%4.0%6.0%8.0%

10/31/2006 10/31/2007 10/31/2008 2009E 2010E

EBITDA

Valuation

$310

$320

$330

$340

$350

$360

$370

10/31/2006 10/31/2007 10/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

7.0x

EBITDA TEV / EBITDA

Transcontinental Inc. (TSX:TCL.A) Price & Vol Chart

0.00

5.00

10.00

15.00

20.00

25.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

500

1,000

1,500

2,000

2,500

3,000

(000)


T R A N S C O N T I N E N T A L I N C . T S X : T C L . A

87

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


YELLOW PAGES INCOME FUND (TSX:YLO.UN)

COMPANY INFORMATIONYellow Pages Income Fund operates as an open-ended, limited purpose trust in Canada. The fund, through its wholly owned trust, YPG Trust, invests in partnership units of YPG LP; and shares of YPG

General Partner, Inc. YPG LP, through subsidiaries, offers print and online directories, specialized publications, classified advertising, and vertical print publications, as well as operates

Websites by topic or area of interest. Yellow Pages Income Fund was founded in 2000 and is based in Verdun, Canada.


Website http://www.ypg.com Latest Fiscal Quarter 3/31/2009





52 Week High (8/11/08) 10.34 Beta 0.50

52 Week Low (2/05/09) 4.68 Float % 99.8%









TSX:YLO.UN YTD (19.3%)

S&P 500 YTD 4.3%998 999 1000 2000





Term Loans 2,050.0 Adjustments 1.4

Snr Bonds and Notes 285.5 Total Debt 2,709.3 Revenue 1,385.0 1,624.4 1,696.7 1,690.5 1,697.4 1,700.6


Trust Preferred 0.0 Undrawn Revolver 1,382.6 Margin (%) 54.0% 53.9% 55.4% 55.4% 54.5% 54.6%Capital Leases 13.8 Undrawn Commercial Paper 500.0 EBIT 575.4 649.5 753.5 767.8 NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) 41.5% 40.0% 44.4% 45.4% NA NATotal Principal Due 2,708.0 Other Available Credit 0.0 Net Income 431.9 527.7 509.2 513.9 565.3 552.1


998 999 1000 2000 Diluted EPS 0.84 0.95 0.89 0.88 1.11 1.08

VALUATION MULTIPLES



TEV / Revenue 6.9x 6.3x 3.9x 3.5x 3.5x 3.5x Cash from Investing (1,237.4) (414.0) (255.4) (283.4)



P / E 18.1x 16.5x 6.7x 6.2x 4.9x 5.0x




EBITDA 38.3% 17.0% 7.4% 4.1% (1.5%) 0.3% Total Equity 5,831.5 5,786.2 5,561.5 5,540.5

Net Income 78.6% 22.2% (3.5%) (3.7%) 11.0% (2.3%)

EPS 56.0% 13.7% (6.7%) (8.0%) 24.8% (2.3%)




Tellier, Marc Cibc Asset Management Inc. 20.9 4.10%

Ci Investments Inc. 17.6 3.45%

Paupe, Christian Mackenzie Financial Corporation 10.5 2.06%


Ramsay, François Mfc Global Investment Management 9.4 1.84%

Rbc Asset Management Inc. 9.1 1.79%

Lion, Jean-Pascal Cypress Capital Management Ltd. 7.7 1.51%


Selected Board Members Title Guardian Capital Lp 5.9 1.16%

Reisch, Marc Pyramis Global Advisors, Llc 5.6 1.10%

Tellier, Marc Tellier, Marc 0.6 0.13%

Boychuk, Michael Total Shares Outstanding 509.3 100.00%

Lambert, Michael

Gaulding, John

Smith, Stuart

Independent Trustee and Chairman of Audit Committee

Independent Trustee, Chairman of Human Resources & Compensation Committee

and Member of Audit Committee

Independent Trustee and Chairman of Corporate Governance & Nominating

Committee

Independent Trustee and Member of Audit Committee

Senior Vice President, Secretary and General Counsel

Vice President of Marketing

Chairman, Member of Human Resources & Compensation Committee, Chairman of

YPG Trust and Chairman of YPG General Partner Inc

Chief Executive Officer, President and Non-independent Trustee

Income Statement

Cash Flow Statement

Chief Executive Officer, President and Non-independent Trustee

Chief Financial Officer and Executive Vice President of Corporate Services

YOY Growth

38%

17%

7%

-1%

0%

(10.0%)

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$200

$400

$600

$800

$1,000

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

EBITDA TEV / EBITDA

Yellow Pages Income Fund (TSX:YLO.UN) Price & Vol Chart

0.002.004.006.008.0010.0012.0014.0016.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

5,000

10,000

15,000

20,000

25,000

(000)


Y E L L O W P A G E S I N C O M E F U N D T S X : Y L O . U N

88

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


BCE, INC. (TSX:BCE)

COMPANY INFORMATIONBCE Inc. provides a suite of communication services to residential and business customers in Canada. Its services include Bell Home Phone local and long distance services, Bell Mobility and Solo

Mobile wireless, high-speed Bell Internet, Bell TV direct-to-home satellite and VDSL television, IP-broadband services, and information and communications technology (ICT) services. The company

provides its services under the Bell and Bell Aliant brands. Its solutions for small and medium-sized business customers include Internet access; Web hosting; business applications that automate

business processes, enhance online presence, secure networks, and support employees; wireless voice and data solutions; various WAN/LAN and cabling solutions; and local and long-distance telephone

services and systems. BCE Inc. delivers security, call centre, storage, and vertical industry solutions through CPE and infrastructure solutions, IT consulting and professional services, and

outsourcing and managed services to enterprise customers. The company was founded in 1880 and is headquartered in Montreal, Canada.

Stock Exchange TSX Latest Fiscal Year 12/31/2008 Primary Industry Integrated Telecommunication Services

Website http://www.bce.ca Latest Fiscal Quarter 3/31/2009





52 Week High (9/02/08) 40.29 Beta 0.36

52 Week Low (12/12/08) 20.94 Float % 99.6%




Plus: Preferred Stock 2,770.0 Average Trading Volume

Plus: Minority Interest 1,072.0 Last Week 2.6

Less: Cash and ST Investments (2,363.0) Last 3 Months 4.3



TSX:BCE YTD (1.2%)

S&P 500 YTD 4.3%998 999 1000 2000








Trust Preferred 0.0 Undrawn Revolver 3,059.0 Margin (%) 37.6% 38.5% 37.3% 38.7% 39.1% 38.7%Capital Leases 2,129.0 Undrawn Commercial Paper 1,484.0 EBIT 3,478.0 3,646.0 3,348.0 3,592.0 NA NA

Other 311.0 Undrawn Term Loans 0.0 Margin (%) 19.8% 20.5% 18.9% 20.3% NA NATotal Principal Due 12,276.0 Other Available Credit 0.0 Net Income 2,007.0 4,057.0 943.0 1,060.0 1,829.0 1,833.6


998 999 1000 2000 Diluted EPS 2.12 4.74 1.12 1.28 2.38 2.39

VALUATION MULTIPLES



TEV / Revenue 2.2x 2.7x 1.8x 1.9x 1.9x 1.8x Cash from Investing (2,228.0) 284.0 (3,921.0) (3,950.0)

TEV / EBITDA 5.8x 6.9x 5.0x 4.8x 4.8x 4.7x Cash from Finaning (3,012.0) (3,914.0) (1,561.0) (2,080.0)

TEV / EBIT 10.3x 12.7x 9.5x 9.2x NA NA Change in Cash 136.0 2,077.0 405.0 (117.0)

P / E 17.4x 14.9x 6.3x 19.4x 10.4x 10.4x



Total Revenue (%) 0.0% 1.1% (0.3%) (0.3%) 0.1% 1.1% Total Liabilities 23,804.0 20,998.0 22,352.0 21,991.0

EBITDA (3.6%) 3.5% (3.4%) 3.8% 5.0% 0.2% Total Equity 13,367.0 17,232.0 17,311.0 16,885.0

Net Income 2.3% 102.1% (76.8%) (72.2%) 94.0% 0.3%

EPS 2.4% 124.2% (76.3%) (71.2%) 112.0% 0.3%




Cope, George Ontario Teachers' Pension Plan 39.8 5.18%


Vanaselja, Siim Ig Investment Management, Ltd. 21.6 2.81%


Crull, Kevin Bmo Harris Investment Management Inc 19.8 2.58%

Barclays Global Investors Canada Limited 18.3 2.39%

Oosterman, Wade Mackenzie Financial Corporation 15.5 2.02%



O'Neill, Thomas Td Securities (Usa) Llc, Asset Management Arm 11.0 1.44%

Cope, George Cope, George 0.2 0.02%

Tellier, Paul Total Shares Outstanding 767.8 100.00%

Levitt, Brian

Brown, Robert

Weiss, Paul

Corporate Director, Chairman of Pension Fund Committee and Director of Bell Canada

Holdings Inc

Director and Chairman of Management Resources & Compensation Committee

Director, Chairman of Corporate Governance Committee and Member of Pension

Fund Committee

Director, Chairman of Audit Committee and Member of Pension Fund Committee

President of Residential Services - Bell Canada

President of Bell Mobility & Channels and Chief Brand Officer - Bell Canada

Chairman

Chief Executive Officer, President, Director, Chief executive Officer of Bell Canada,

President of Bell Canada Holdings Inc and Director of Bell Canada

Income Statement

Cash Flow Statement

Chief Executive Officer, President, Director, Chief executive Officer of Bell Canada,

President of Bell Canada Holdings Inc and Director of Bell Canada

Chief Financial Officer, Executive Vice President, Chief Financial Officer of Bell Canada

and Executive Vice President of Bell Canada

YOY Growth

-4%

3%

-3%

5%

0%

(4.0%)

(2.0%)

0.0%

2.0%

4.0%

6.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$6,400

$6,500

$6,600

$6,700

$6,800

$6,900

$7,000

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

7.0x

8.0x

EBITDA TEV / EBITDA

BCE, Inc. (TSX:BCE) Price & Vol Chart

0.005.0010.0015.0020.0025.0030.0035.0040.0045.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

10,000

20,000

30,000

40,000

50,000

(000)


B C E , I N C . T S X : B C E

89

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

TELECOMMUNICATIONS


CANADIAN SATELLITE RADIO HOLDINGS INC (TSX:XSR)

COMPANY INFORMATIONCanadian Satellite Radio Holdings, Inc., through its subsidiary, Canadian Satellite Radio, Inc., provides XM satellite digital audio radio services in Canada. It has an exclusive license from XM

Satellite Radio Holdings, Inc. to provide satellite digital audio radio services in Canada. The company, through XM, offers approximately 130 channels, which include commercial-free music, news,

talk, sports, and children’s programming. It also distributes digital audio entertainment. The company was incorporated in 2002 and is based in Toronto, Canada.

Stock Exchange TSX Latest Fiscal Year 8/31/2008 Primary Industry Cable and Satellite

Website http://www.xmradio.ca Latest Fiscal Quarter 2/28/2009





52 Week High (6/06/08) 4.20 Beta 2.12

52 Week Low (2/25/09) 0.15 Float % 22.2%









TSX:XSR YTD (15.4%)

S&P 500 YTD 4.3%998 999 1000 2000







Sub Bonds and Notes 15.3 EBITDA (83.1) (51.9) (34.4) (25.3) (18.4) (12.6)

Trust Preferred 0.0 Undrawn Revolver 37.4 Margin (%) (1195.9%) (244.4%) (87.1%) (53.5%) (34.4%) (18.9%)Capital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT (99.0) (74.3) (56.6) (47.6) NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) (1425.0%) (349.9%) (143.5%) (100.5%) NA NATotal Principal Due 124.9 Other Available Credit 0.0 Net Income (102.7) (84.6) (74.3) (92.7) (73.0) (53.4)

Total Undrawn Credit 37.4 Margin (%) (1477.9%) (398.4%) (188.4%) (195.9%) (136.2%) (80.0%)

998 999 1000 2000 Diluted EPS (2.99) (1.78) (1.55) (1.93) (1.47) (1.08)

VALUATION MULTIPLES



TEV / Revenue 114.9x 18.5x 7.9x 3.4x 3.0x 2.4x Cash from Investing (66.2) 7.2 3.1 15.2

TEV / EBITDA NM NM NM NM NA NA Cash from Finaning 174.9 0.0 19.4 (1.5)

TEV / EBIT NM NM NM NM NA NA Change in Cash 45.2 (35.7) (3.2) 0.7

P / E NM NM NM NM NA NA



Total Revenue (%) 0.0% 205.7% 85.7% 58.4% 35.8% 24.6% Total Liabilities 128.5 142.3 172.3 204.1

EBITDA NM NM NM NM NM NM Total Equity 227.4 146.9 84.0 34.1

Net Income NM NM NM NM NM NM





Bitove, John Mfc Global Investment Management (U.S.), Llc 0.7 1.42%

Goodwood Inc. 0.1 0.12%

Moskowitz, Michael

Washinushi, Michael

Lyons, Stewart


Bitove, John

Boivin, Pierre Wilcox, Mariette 0.2 0.31%

Storey, Robert Total Shares Outstanding 49.5 100.00%

McCutcheon, James

Wilcox, Mariette

Evershed, Philip

Director, Chairman of Compensation Committee, Member of Audit Committee and

Member of Corporate Governance Committee

Director, Chairman of Corporate Governance Committee, Member of Audit

Committee and Member of Compensation Committee

Director

Director

Chief Financial Officer, Secretary and Treasurer

Executive Vice President

Executive Chairman

Director, Chairman of Audit Committee, Member of Compensation Committee and


Income Statement

Cash Flow Statement

Executive Chairman


YOY Growth

0% 0% 0% 0% 0%0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

EBITDA

Valuation

($100)

($80)

($60)

($40)

($20)

$0

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

0.2x

0.4x

0.6x

0.8x

1.0x

EBITDA TEV / EBITDA

Canadian Satellite Radio Holdings Inc (TSX:XSR) Price & Vol Chart

0.001.002.003.004.005.006.007.008.009.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

3/30/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/22/2007

12/4/2007

1/11/2008

2/22/2008

4/2/2008

5/12/2008

6/26/2008

8/5/2008

9/16/2008

10/27/2008

12/1/2008

1/12/2009

2/27/2009

4/6/2009

5/13/2009

($)

-100200300400500600700800900

(000)


C A N A D I A N S A T E L L I T E R A D I O H O L D I N G S I N C . T S X : X S R

90

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


COGECO CABLE INC. (TSX:CCA)

COMPANY INFORMATIONCogeco Cable, Inc. offers analogue and digital television, high speed Internet (HIS), telephony, and other telecommunications services to residential and commercial customers in Canada and

Portugal. It also provides a range of discretionary services, including specialty television service tiers, pay television services, pay-per-view services, video on demand, subscription video on

demand, digital music channels, and high definition programming services. In addition, the company offers telecommunication services consisting of unlimited calling in Canada and continental U.S., and

voice mail, call display, call waiting, visual call waiting, call forwarding services, and assistance services; and operates a broadband network, which enables to provide organizations in

South-western Ontario with the broadband capacity required for data networking, HIS access, e-business applications, video conferencing, and other advanced communications. Further, Cogeco Cable provides

data communications and other telecommunications services, including Ethernet, private line, voice over Internet protocol, HSI access, dark fiber, data storage, data security, and co-location;

and owns and operates RYTHME FM, which has four radio stations in the province of Quebec, Montreal, Quebec City, and the Mauricie and Eastern Townships regions, as well as radio-station 933 in

Quebec City. As of August 31, 2008, it provided basic cable service to 857,094 customers; digital television services to 441,746 customers; HSI services to 473,467 customers; and telephony service

to 219,601 customers in Canada. The company was founded in 1992 and is headquartered in Montreal, Canada. Cogeco Cable, Inc. is a subsidiary of COGECO, Inc.


Website http://www.cogeco.com Latest Fiscal Quarter 2/28/2009





52 Week High (8/18/08) 44.59 Beta 0.80

52 Week Low (11/20/08) 26.08 Float % 85.8%









TSX:CCA YTD (16.6%)

S&P 500 YTD 4.3%998 999 1000 2000






Snr Bonds and Notes 583.2 Total Debt 1,065.3 Revenue 620.0 938.9 1,076.8 1,164.2 1,214.1 1,280.2



Other 0.0 Undrawn Term Loans 0.0 Margin (%) 21.3% 19.3% 20.2% 20.1% NA NATotal Principal Due 1,065.1 Other Available Credit 0.0 Net Income 65.6 84.7 133.3 (272.0) 105.0 116.3


998 999 1000 2000 Diluted EPS 1.63 1.94 2.73 (5.61) 2.16 2.40

VALUATION MULTIPLES






P / E 23.8x 23.4x 15.4x NM 12.5x 11.3x




EBITDA 13.4% 50.7% 20.9% 20.0% 18.3% 5.4% Total Equity 745.2 1,165.7 1,305.1 967.3

Net Income 128.3% 29.2% 57.4% NM (21.2%) 10.7%

EPS 128.0% 19.0% 40.7% NM (20.9%) 10.7%




Audet, Louis Jarislowsky, Fraser Limited 3.3 6.77%

Jones Heward Investment Counsel Inc. 1.0 1.96%

Gagné, Pierre Rbc Asset Management Inc. 0.5 1.09%

Mfc Global Investment Management 0.4 0.85%

Bélanger, Denis Natcan Investment Management Inc. 0.4 0.79%


Perrotta, Ron Ig Investment Management, Ltd. 0.3 0.65%

Connor, Clark & Lunn Investment Management Ltd. 0.2 0.47%


Peeters, Jan Sceptre Investment Counsel Ltd. 0.2 0.41%

Audet, Louis Audet, Louis 0.0 0.05%

Audet, Henri Total Shares Outstanding 48.6 100.00%

McAusland, David

Garcia, Claude

Gadbois, L.

Chairman Emeritus

Director, Chairman of Corporate Governance Committee and Member of Strategic

Opportunities Committee

Director, Chairman of Human Resources Committee and Member of Strategic


Director and Chairman of Audit Committee

Vice President of Technology Development

Vice President of Marketing and Strategic Planning

Chairman, Chairman of Strategic Opportunities Committee, Member of Audit

Committee, Member of Corporate Governance Committee and Member of Human

Chief Executive Officer, President, Director and Member of Strategic Opportunities

Committee

Income Statement

Cash Flow Statement


Committee

Chief Financial Officer and Vice-President of Finance

YOY Growth

13%

51%

21% 18%

5%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

EBITDA

Valuation

$0

$100

$200

$300

$400

$500

$600

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

EBITDA TEV / EBITDA

Cogeco Cable Inc. (TSX:CCA) Price & Vol Chart

0.00

10.00

20.00

30.00

40.00

50.00

60.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-2004006008001,0001,2001,4001,6001,800

(000)


C O G E C O C A B L E I N C . T S X : C C A

91

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


COGECO INC. (TSX:CGO)

COMPANY INFORMATIONCOGECO, Inc. operates as a diversified communications company. The company, through its subsidiary, Cogeco Cable, Inc., offers cable television, high speed internet, telephony services, and other

telecommunications services to residential and commercial customers in Canada and Portugal. It also provides a range of discretionary services, including specialty television service tiers, pay

television services, pay-per-view services, video-on-demand, subscription video-on-demand, digital music channels, digital cable service, and high definition programming services, as well as

telecommunication services to businesses and institutional customers. The company, through its other subsidiary, Cogeco Radio-Television, Inc., offers radio broadcasting services, as well as owns and

operates the RYTHME FM network, which has 4 radio stations throughout the Province of Quebec, in Montreal, Quebec City, and in the Mauricie and Eastern Townships regions, as well as radio

station 933 in Quebec City. COGECO is headquartered in Montreal, Canada.


Website http://www.cogeco.ca Latest Fiscal Quarter 2/28/2009





52 Week High (8/29/08) 34.86 Beta 0.84

52 Week Low (12/05/08) 17.50 Float % 62.8%









TSX:CGO YTD (9.6%)

S&P 500 YTD 4.3%998 999 1000 2000






Snr Bonds and Notes 583.2 Total Debt 1,084.2 Revenue 746.9 969.3 1,108.9 1,197.0 1,251.0 1,330.4



Other 0.0 Undrawn Term Loans 0.0 Margin (%) 16.9% 18.6% 19.8% 20.0% NA NATotal Principal Due 1,084.0 Other Available Credit 0.0 Net Income 23.1 74.7 25.1 (85.0) 40.0 47.6


998 999 1000 2000 Diluted EPS 1.39 5.13 2.58 (5.09) 2.38 2.84

VALUATION MULTIPLES






P / E 28.1x 11.7x 9.6x NM 9.3x 7.8x




EBITDA 9.7% 51.2% 22.0% 21.9% 20.5% 7.1% Total Equity 319.3 392.5 421.0 316.5

Net Income NM 223.5% (66.4%) NM 59.3% 19.0%

EPS NM 269.0% (49.7%) NM (7.6%) 19.0%




Audet, Louis Pembroke Management Ltd. 0.3 1.79%

Howson Tattersall Investment Counsel 0.2 0.97%

Gagné, Pierre Gabelli Funds, Llc 0.1 0.77%


Guimond, Rene Morgan Meighen & Associates Limited 0.1 0.36%

Montrusco Bolton Investments Inc. 0.0 0.21%

Mayrand, Yves Gamco Investors, Inc. 0.0 0.10%


Selected Board Members Title Fiera Capital Inc. 0.0 0.02%

Peeters, Jan Gamco Asset Management, Inc. 0.0 0.01%

Audet, Louis Audet, Louis 0.1 0.34%

McAusland, David Total Shares Outstanding 16.8 100.00%

Garcia, Claude

Comtois, Pierre

Boutet, Jacqueline

Director, Chairman of Corporate Governance Committee and Member of Strategic


Director, Chairman of Human Resources Committee and Member of Strategic


Director, Chairman of Audit Committee and Member of Corporate Governance

Committee

Director, Member of Human Resources Committee, Member of Audit Committee and


Chief Executive Officer of Cogeco Radio -Télévision Inc, President of Cogeco Radio-

Télévision Inc and Vice President of Development New Media - Cogeco Cable Inc

Vice President of Corporate Affairs

Chairman, Chairman of Strategic Opportunities Committee, Member of Audit

Committee, Member of Corporate Governance Committee, Member of Human

f fChief Executive Officer, President, Director and Member of Strategic Opportunities

Committee

Income Statement

Cash Flow Statement


Committee

Chief Financial Officer and Vice-President of Finance

YOY Growth

10%

51%

22% 20%

7%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

EBITDA

Valuation

$0

$100

$200

$300

$400

$500

$600

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

EBITDA TEV / EBITDA

Cogeco Inc. (TSX:CGO) Price & Vol Chart

0.00

10.00

20.00

30.00

40.00

50.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-100200300400500600700

(000)


C O G E C O I N C . T S X : C G O

92

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


JUMPTV INC. (TSX:JTV)

COMPANY INFORMATIONJumpTV Inc. provides end-to-end solutions for delivering premium sports, and international and religious programming through the Internet to consumers’ televisions or computers worldwide. The

company, through customer/partner relationships with sports and international television content partners, offers customer/partner content to be viewed by way of Internet on personal computers, as

well as on the television, through its proprietary Internet protocol television (IPTV) set top boxes. It also offers various services and technologies over its IPTV platform that builds and

manages private broadcasting networks, and delivers streaming video and broadcast television programs to the television, Web, mobile, and other devices. In addition, the company engages in streaming

live sporting events through its consumer Web sites consisting of JumpTV.com, Cycling.TV, and SportsYa.com, as well as through its collegiate and sports partner Web sites. Further, it offers

business and administrative support services required to support IPTV implementation and operations, including content management, subscriber management, digital rights management, and billing and

delivery services. The company is based in Toronto, Canada.


Website http://www.jumptv.com Latest Fiscal Quarter 12/31/2008





52 Week High (7/23/08) 1.28 Beta 0.95

52 Week Low (11/21/08) 0.22 Float % 55.8%









TSX:JTV YTD 85.7%

S&P 500 YTD 4.3%998 999 1000 2000











998 999 1000 2000 Diluted EPS (0.64) (0.11) (0.21) (0.21) NA NA

VALUATION MULTIPLES



TEV / Revenue 0.0x 0.0x 4.0x 3.3x NA NA Cash from Investing (1.1) (1.6) 20.3 20.3


TEV / EBIT 0.0x 0.0x NM NM NA NA Change in Cash 1.5 (1.0) 26.7 26.7




Total Revenue (%) (21.3%) 420.4% 72.1% 72.1% NA NA Total Liabilities 0.5 4.0 16.7 16.7







Li, Nancy Artemis Investment Management Ltd. 1.1 0.97%


McCarthy, Arthur Fil Fund Management Limited 0.0 0.00%

Fil Investments International 0.0 0.00%

Nunn, Ronald Fil (Luxembourg) S.A. 0.0 0.00%

Fil Investment Advisors (Uk) Limited 0.0 0.00%

Her, Horngwei Fidelity Investments (Singapore) Limited 0.0 0.00%

Fidelity Investments Management (Hong Kong) Limited 0.0 0.00%


Wang, Charles

Li, Nancy Li, Nancy 39.2 34.42%

Paterson, G. Total Shares Outstanding 113.8 100.00%

Reichbach, Roy

Kronfeld, David

Anderson, John

Vice Chairman

Corporate Secretary, General Counsel, Director and Member of Corporate Governance

Committee

Director, Chairman of Compensation Committee and Member of Audit Committee

Lead Independent Director, Chairman of Audit Committee and Chairman of Corporate


Executive Vice President of Business Operations

Executive Vice President of Research & Development

Chairman

Chief Executive Officer, Director and Chief Executive Officer of NeuLion Inc

Income Statement

Cash Flow Statement

Chief Executive Officer, Director and Chief Executive Officer of NeuLion Inc


YOY Growth

0% 0% 0% 0% 0%0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

($10)

($8)

($6)

($4)

($2)

$0

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

0.2x

0.4x

0.6x

0.8x

1.0x

EBITDA TEV / EBITDA

JumpTV Inc. (TSX:JTV) Price & Vol Chart

0.00

2.00

4.00

6.00

8.00

10.00

12.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

500

1,000

1,500

2,000

2,500

(000)


J U M P T V I N C . T S X : J T V

93

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


MANITOBA TELECOM SERVICES, INC. (TSX:MBT)

COMPANY INFORMATIONManitoba Telecom Services Inc. provides wireless, data, local, and long distance communications services in Canada. The company operates in two segments, Enterprise Solutions and Consumer

Markets. The Enterprise Solutions segment offers Internet protocol connectivity, unified communications, IT consulting and security solutions, and voice and data connectivity services. It also provides

international connections through strategic alliances and interconnection agreements with other international service providers. This segment operates under the Allstream brand in Canada and

under the MTS Allstream brand in Manitoba. The Consumer Markets segment offers consumers next generation wireless, high-speed Internet and data, digital television, and wireline voice services, as

well as security and alarm monitoring services, through its subsidiary, AAA Alarm Systems, Ltd. It operates under the MTS brand in Manitoba. This segment also provides a range of business Internet,

data, and voice services to customers in the Canadian markets under the Allstream brand. The company was founded in 1933 and is headquartered in Winnipeg, Canada.


Website http://www.mts.ca Latest Fiscal Quarter 3/31/2009





52 Week High (11/18/08) 43.87 Beta 0.16

52 Week Low (10/10/08) 30.01 Float % 99.3%









TSX:MBT YTD (4.8%)

S&P 500 YTD 4.3%998 999 1000 2000











998 999 1000 2000 Diluted EPS 1.42 2.60 2.23 1.96 2.86 2.91

VALUATION MULTIPLES






P / E 32.9x 16.7x 16.1x 17.5x 11.9x 11.7x



Total Revenue (%) (2.7%) (1.1%) 0.8% 0.4% 0.1% 0.6% Total Liabilities 1,415.4 1,335.3 1,271.0 1,271.5

EBITDA 1.4% 0.3% (5.1%) (5.1%) 1.6% 1.3% Total Equity 1,505.9 1,404.0 1,382.0 1,377.7

Net Income 40.1% (43.3%) (15.1%) (25.8%) 28.6% 1.7%

EPS (51.3%) 82.8% (14.4%) (25.4%) 28.4% 1.7%




Blouin, Pierre Cibc Asset Management Inc. 2.8 4.33%

Ci Investments Inc. 2.4 3.71%

Demkey, Wayne Mfc Global Investment Management 0.6 0.90%


Shepherd, Kelvin Leon Frazer & Associates Inc. 0.3 0.46%

Greystone Managed Investments Inc. 0.3 0.44%

Prevost, Dean Qv Investors Inc 0.2 0.35%

Merrill Lynch Asset Management U.K. Limited 0.2 0.34%

Selected Board Members Title Ig Investment Management, Ltd. 0.2 0.30%

Stefanson, Thomas Td Asset Management, Inc. 0.2 0.29%

Blouin, Pierre Blouin, Pierre 0.1 0.11%

Penny, Donald Total Shares Outstanding 64.7 100.00%

Filmon, Gary

Kapoor, Kishore

Everett, N.


Director, Chairman of Human Resources & Compensation Committee, Member of

Strategic Planning Committee and Member of Governance & Nominating Committee

Independent Director, Chairman of Strategic Planning Committee and Member of

Audit Committee

Independent Director, Member of Strategic Planning Committee, Member of

Governance & Nominating Committee and Member of Human Resources &

President of Consumer Markets

President of Enterprise Solutions Division

Chairman, Chairman of Governance & Nominating Committee, Member of Human

Resources & Compensation Committee, Member of Strategic Planning Committee,

f fChief Executive Officer, Non Independent Director and Chief Executive Officer of MTS

Allstream Inc

Income Statement

Cash Flow Statement

Chief Executive Officer, Non Independent Director and Chief Executive Officer of MTS

Allstream Inc

Chief Financial Officer and Corporate Controller

YOY Growth1%

0%

-5%

2% 1%

(6.0%)

(5.0%)

(4.0%)

(3.0%)

(2.0%)

(1.0%)

0.0%

1.0%

2.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$610

$620

$630

$640

$650

$660

$670

$680

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

7.0x

EBITDA TEV / EBITDA

Manitoba Telecom Services, Inc. (TSX:MBT) Price & Vol Chart

0.00

10.00

20.00

30.00

40.00

50.00

60.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-5001,0001,5002,0002,5003,0003,5004,000

(000)


M A N I T O B A T E L E C O M S E R V I C E S , I N C . T S X : M B T

94

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


ROGERS COMMUNICATIONS INC. (TSX:RCI.B)

COMPANY INFORMATIONRogers Communications, Inc. operates as a communications and media company in Canada. It operates in three segments: Wireless, Cable, and Media. The Wireless segment offers wireless voice, data,

and messaging services. It operates a global system for mobile communications/general packet radio service network, as well as provides wireless data services, including mobile access to the

Internet, wireless e-mail, digital picture and video transmission, mobile video, music downloading, video calling, and two-way short messaging services. This segment markets its products and services

under Rogers Wireless and Fido brand names. The Cable segment provides cable television, cable telephony, and high-speed Internet access. As of December 31, 2008, it provided digital cable

services to approximately 1.6 million households; Internet service to approximately 1.6 million residential subscribers; and local telephone and long-distance services through 1.1 million subscriber

lines. It also offers local and long-distance telephone, enhanced voice and data services, and IP access to Canadian businesses and governments. In addition, this segment operates a retail

distribution chain consisting of 456 stores that offer home entertainment and wireless products and services. In addition, it offers digital video disc and video game sales and rentals. The Media

segment engages in radio and television broadcasting businesses, and consumer and trade publishing businesses, as well as offers televised home shopping services. As of December 31, 2008, it operated

52 radio stations in Canada; multicultural OMNI television stations; five station Citytv television network; specialty sports television services, including regional sports service Rogers

Sportsnet and Setanta Sports Canada; specialty services, which include OLN, The Biography Channel Canada, and G4TechTV Canada; and televised shopping service, The Shopping Channel. The company was

founded in 1920 and is based in Toronto, Canada.

Stock Exchange TSX Latest Fiscal Year 12/31/2008 Primary Industry Wireless Telecommunication Services

Website http://www.rogers.com Latest Fiscal Quarter 3/31/2009





52 Week High (6/18/08) 42.89 Beta 0.74

52 Week Low (3/09/09) 25.40 Float % 76.9%









TSX:RCI.B YTD (11.2%)

S&P 500 YTD 4.3%998 999 1000 2000








Trust Preferred 0.0 Undrawn Revolver 1,815.0 Margin (%) 32.5% 35.3% 36.8% 36.2% 36.1% 36.6%Capital Leases 1.0 Undrawn Commercial Paper 0.0 EBIT 1,309.0 1,968.0 2,406.0 2,388.0 NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) 14.8% 19.4% 21.2% 20.8% NA NATotal Principal Due 8,514.0 Other Available Credit 0.0 Net Income 622.0 637.0 1,002.0 967.0 1,276.7 1,449.2


998 999 1000 2000 Diluted EPS 0.97 0.99 1.57 1.52 2.02 2.29

VALUATION MULTIPLES



TEV / Revenue 3.3x 3.5x 2.8x 2.6x 2.5x 2.4x Cash from Investing (1,633.0) (2,438.0) (3,337.0) (3,417.0)

TEV / EBITDA 10.8x 10.1x 7.5x 7.1x 6.9x 6.5x Cash from Finaning (731.0) (429.0) 72.0 88.0

TEV / EBIT 26.6x 18.7x 12.6x 12.3x NA NA Change in Cash 85.0 (42.0) 42.0 (28.0)

P / E 57.4x 51.8x 16.8x 21.4x 16.1x 14.2x




EBITDA 31.9% 24.5% 16.7% 7.2% 2.6% 6.3% Total Equity 4,200.0 4,624.0 4,727.0 4,855.0

Net Income NM 2.4% 57.3% 19.2% 27.4% 13.5%

EPS NM 2.4% 58.3% 19.7% 28.6% 13.5%




Horn, Alan Rbc Asset Management Inc. 28.9 4.57%


Mohamed, Nadir Thornburg Investment Management, Inc. 17.6 2.78%


Linton, William Bns Investments Inc. 11.5 1.83%


Viner, Tony Marathon Asset Management, Llp 11.2 1.76%

Caisse De Depot Et Placement Du Quebec 10.1 1.60%

Selected Board Members Title Mclean Budden Limited 9.2 1.45%

Horn, Alan Td Securities (Usa) Llc, Asset Management Arm 9.1 1.43%

Mohamed, Nadir Rogers, Edward (Deceased) 141.5 22.39%

Lind, Philip Total Shares Outstanding 632.0 100.00%

Wansbrough, John

Viner, Tony

Rogers, Loretta

Vice-Chairman and Member of Advisory Committee

Independent Director, Chairman of Pension Committee, Member of Audit Committee,

Member of Executive Committee, Member of Finance Committee, Chairman of Rogers

Chief Executive Officer of Rogers Media Inc, Chief Executive Officer of Rogers

Broadcasting Limited, President of Rogers Media Inc and Director of Rogers Media Inc

Director, Member of Advisory Committee, Director of Rogers Cable Inc, Director of

Rogers Media Inc, Director of Rogers TeleCommunivation Inc and Director of Rogers

Chief Financial Officer and Senior Vice President of Finance

Chief Executive Officer of Rogers Media Inc, Chief Executive Officer of Rogers

Broadcasting Limited, President of Rogers Media Inc and Director of Rogers Media Inc

Chairman of the Board, Chairman of Executive Committee, Member of Pension

Committee, Member of Advisory Committee, Chief Executive Officer of Rogers

f ffi f fChief Executive Officer, President, Director of Communications Division and Director

Income Statement

Cash Flow Statement

Chairman of the Board, Chairman of Executive Committee, Member of Pension

Committee, Member of Advisory Committee, Chief Executive Officer of Rogers

l d h f ffi f l d fChief Executive Officer, President, Director of Communications Division and Director

YOY Growth32%

25%

17%

3%6%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$1,000

$2,000

$3,000

$4,000

$5,000

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

EBITDA TEV / EBITDA

Rogers Communications Inc. (TSX:RCI.B) Price & Vol Chart

0.00

10.00

20.00

30.00

40.00

50.00

60.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-2,0004,0006,0008,00010,00012,00014,000

(000)


R O G E R S C O M M U N I C A T I O N S I N C . T S X : R C I . B

95

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


SHAW COMMUNICATIONS, INC. (TSX:SJR.B)

COMPANY INFORMATIONShaw Communications, Inc., a diversified communications company, provides broadband cable television services, Internet, digital phone, telecommunications services, Direct-to-home (DTH) satellite

services, and satellite distribution services primarily in Canada and the United States. The company’s cable television services include cable and extended tiers, digital cable, pay television

and pay-per-view, video-on-demand, bundling of services, and new video services. It also provides high speed Internet access services to residential and business subscribers. The company’s digital

phone services include local residential line and long distance calling, as well as calling features, including voicemail, call display, call forwarding, three-way calling, call return, and call

waiting. In addition, it operates a fiber network that serves as a platform for voice services, IP-based services, business-to-business services, and video. Further, the company distributes

digital video and audio programming services through DTH satellite to residences and businesses; uplinks and redistributes television and radio signals through satellite to cable operators and other

distributors, and related network services; and provides satellite tracking and messaging services to the trucking industry, as well as integrates and manages satellite data networks with

land-based telecommunications. Additionally, it owns and leases, directly and indirectly, satellite transponders that receive and amplify digital signals and transmit them to receiving dishes located

within the footprint covered by the satellite. As of August 31, 2008, the company had 906,320 digital cable customers, and 611,931 digital phone lines; and 892,528 DTH subscribers. Shaw

Communications, Inc., formerly known as Capital Cable Television Co., Ltd., was founded in 1966 and is headquartered in Calgary, Canada.


Website http://www.shaw.ca Latest Fiscal Quarter 2/28/2009





52 Week High (9/02/08) 24.20 Beta 0.37

52 Week Low (3/09/09) 17.37 Float % 80.2%









TSX:SJR.B YTD (13.4%)

S&P 500 YTD 4.3%998 999 1000 2000







Sub Bonds and Notes 0.0 EBITDA 965.2 1,148.4 1,317.8 1,379.2 1,545.2 1,673.0


Other 6.5 Undrawn Term Loans 0.0 Margin (%) 23.6% 27.6% 29.1% 29.0% NA NATotal Principal Due 2,761.4 Other Available Credit 0.0 Net Income 458.3 388.5 671.6 539.8 540.8 595.9


998 999 1000 2000 Diluted EPS 1.05 0.89 1.55 1.25 1.26 1.39

VALUATION MULTIPLES


8/31/2006 8/31/2007 8/31/2008 2/28/2009 2009E 2010E Cash from Operations 846.9 1,000.0 1,242.2 1,357.9

TEV / Revenue 4.3x 5.0x 4.2x 3.4x 3.2x 3.0x Cash from Investing (489.1) (719.8) (734.1) (1,023.4)



P / E 23.3x 23.2x 14.8x 15.0x 14.9x 13.5x




EBITDA 13.6% 19.0% 14.8% 12.2% 17.3% 8.3% Total Equity 1,809.7 1,994.0 2,255.2 2,416.7

Net Income 199.1% (15.2%) 72.9% (15.5%) (19.5%) 10.2%

EPS 213.6% (15.3%) 73.6% (14.5%) (18.7%) 10.2%




Shaw, J. Rbc Asset Management Inc. 35.2 8.18%


Shaw, Jim Td Securities (Usa) Llc, Asset Management Arm 17.1 3.98%

T. Rowe Price Associates, Inc. 16.1 3.74%

Bissonnette, Peter Capital World Investors 13.5 3.14%

Barclays Global Investors Canada Limited 10.4 2.43%

Wilson, Steve Jones Heward Investment Counsel Inc. 9.5 2.20%

Bns Investments Inc. 7.9 1.85%

Selected Board Members Title Gwl Investment Management Ltd. 7.0 1.62%

Shaw, J. Td Asset Management, Inc. 6.4 1.49%

Shaw, Jim Shaw, J. 36.4 8.46%

Bissonnette, Peter Total Shares Outstanding 429.9 100.00%

Shaw, Bradley

Yuill, Willard

O'Brien, Michael

President and Director

Senior Vice President of Operations and Director

Director and Chairman of Human Resources & Compensation Committee

Lead Director and Chairman of Audit Committee

President and Director


Founder, Executive Chairman and Chairman of Executive Committee

Vice Chairman and Chief Executive Officer

Income Statement

Cash Flow Statement

Founder, Executive Chairman and Chairman of Executive Committee

Vice Chairman and Chief Executive Officer

YOY Growth

14%

19%

15%

17%

8%

0.0%

5.0%

10.0%

15.0%

20.0%

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

EBITDA

Valuation

$0

$500

$1,000

$1,500

$2,000

8/31/2006 8/31/2007 8/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

EBITDA TEV / EBITDA

Shaw Communications, Inc. (TSX:SJR.B) Price & Vol Chart

0.00

5.00

10.00

15.00

20.00

25.00

30.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-1,0002,0003,0004,0005,0006,0007,0008,0009,000

(000)


S H A W C O M M U N I C A T I O N S , I N C . T S X : S J R . B

96

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


TELUS CORPORATION (TSX:T)

COMPANY INFORMATIONTELUS Corporation provides telecommunications products and services in Canada. It operates in two segments, Wireline and Wireless. The Wireline segment provides voice solutions, which include

local, long distance, and call management services, such as voice mail, call display, and call waiting, as well as the sale, rental, and maintenance of telephone equipment; Internet solutions that

consist of high-speed or dial-up with security and entertainment services; TELUS TV with video on demand and pay per view services; data solutions, such as Internet protocol (IP) networks, private

line, switched services, network wholesale, network management, and hosting; and converged voice and data solutions comprising integrated and hosted IP telephony solutions. It also offers

hosting and infrastructure products comprising managed information technology and infrastructure solutions delivered through TELUS IP networks connected to TELUS’ Internet data centers; security

solutions, such as security consulting services and managed and non-managed solutions to protect business networks, messaging, and data; and customized solutions, such as multi-language contact centre

solutions, including CallCentreAnywhere, remote agent solutions, interactive voice response and speech recognition services, conferencing and collaboration services, performance optimization,

human resource, and health and safety outsourcing solutions. The Wireless segment provides various solutions, including digital voice services, such as PCS postpaid, PCS Pay & Talk prepaid, Mike

all-in-one, Push To Talk capability on both Mike, and PCS; Internet and data solutions, including TELUS Mobile TV, TELUS Mobile Radio, TELUS Mobile Music, Web browsing, Windows Live Messenger,

social networking, text and picture messaging, and downloadable games, videos, ringtones, and images; and data devices, including smartphones and wireless connect cards. The company was founded in

1993 and is based in Vancouver, Canada.


Website http://www.telus.com Latest Fiscal Quarter 3/31/2009





52 Week High (6/05/08) 47.16 Beta 0.45

52 Week Low (4/30/09) 29.12 Float % 99.3%









TSX:T YTD (11.9%)

S&P 500 YTD 4.3%998 999 1000 2000








Trust Preferred 0.0 Undrawn Revolver 451.0 Margin (%) 42.6% 40.5% 39.8% 39.4% 37.6% 37.5%Capital Leases 5.0 Undrawn Commercial Paper 0.0 EBIT 2,124.2 2,061.0 2,125.0 2,098.0 NA NA

Other 2.0 Undrawn Term Loans 0.0 Margin (%) 24.5% 22.7% 22.0% 21.7% NA NATotal Principal Due 6,352.0 Other Available Credit 0.0 Net Income 1,145.0 1,258.0 1,128.0 1,158.0 1,043.5 1,033.3


998 999 1000 2000 Diluted EPS 3.30 3.77 3.50 3.62 3.28 3.25

VALUATION MULTIPLES



TEV / Revenue 2.7x 2.3x 1.9x 1.7x 1.7x 1.7x Cash from Investing (1,675.2) (1,772.0) (3,433.0) (2,902.0)

TEV / EBITDA 6.5x 5.8x 4.7x 4.4x 4.6x 4.5x Cash from Finaning (1,148.6) (1,369.0) 598.0 119.0


P / E 19.5x 15.3x 9.7x 9.1x 9.9x 10.0x




EBITDA 10.5% (0.6%) 4.4% (1.2%) (4.1%) 2.0% Total Equity 7,048.0 6,926.0 7,182.0 7,290.0

Net Income 63.5% 9.9% (10.3%) (14.5%) (7.5%) (1.0%)

EPS 69.9% 14.3% (7.0%) (11.9%) (6.3%) (1.0%)




Entwistle, Darren Ig Investment Management, Ltd. 21.8 6.86%


McFarlane, Robert Td Asset Management, Inc. 7.4 2.33%

Letko, Brosseau & Associates Inc. 6.2 1.95%

Natale, Joe Lazard Asset Management Llc 5.3 1.67%

Pictet Asset Management Limited 4.9 1.53%

Salvadori, Kevin Td Securities (Usa) Llc, Asset Management Arm 4.5 1.41%


Selected Board Members Title Bns Investments Inc. 4.2 1.33%

Canfield, Brian Ci Investments Inc. 3.3 1.05%

Entwistle, Darren Entwistle, Darren 0.2 0.07%

Hillier, Rick Total Shares Outstanding 317.9 100.00%

Woodley, Donald

MacNeill, Brian

Auchinleck, R.

Chairman of Atlantic Canada Community Board

Director, Chairman of Pension Committee and Member of Corporate Governance

Committee


Corporate Director, Chairman of Corporate Governance Committee and Member of

Pension Committee

Executive Vice President and President of Business Solutions

Executive Vice President of Business Transformation and Technology Operations

Chairman and Member of Pension Committee

Chief Executive Officer, President, Director, Interim Chief Executive Officer of Telus

Mobility and Interim President of Telus Mobility

Income Statement

Cash Flow Statement

Chief Executive Officer, President, Director, Interim Chief Executive Officer of Telus

Mobility and Interim President of Telus Mobility


YOY Growth

10%

-1%

4%

-4%

2%

(5.0%)

0.0%

5.0%

10.0%

15.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$3,550

$3,600

$3,650

$3,700

$3,750

$3,800

$3,850

$3,900

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

7.0x

EBITDA TEV / EBITDA

TELUS Corporation (TSX:T) Price & Vol Chart

0.0010.0020.0030.0040.0050.0060.0070.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

2,000

4,000

6,000

8,000

10,000

12,000

(000)


T E L U S C O R P O R A T I O N T S X : T

97

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


CINEPLEX ENTERTAINMENT LIMITED PARTNERSHIP (TSX:CGX.UN)

COMPANY INFORMATIONCineplex Entertainment Limited Partnership operates as a motion picture exhibitor in Canada. The company exhibits digital, 3D, and IMAX projection technologies. It operates theaters under the

Alliance, Cinema City, Cineplex Odeon Cinemas, Coliseum, Colossus, Famous Players, Galaxy, SilverCity, and Scotiabank brands primarily in Toronto, Montreal, Vancouver, Calgary, Edmonton, Ottawa, and

Quebec City. As of December 31, 2008, the company owned, leased, and had joint-venture interest in 1,331 screens in 130 theatres. Cineplex Entertainment Corporation serves as the general partner

of the company. The company was founded in 1920 and is headquartered in Toronto, Canada. Cineplex Entertainment Limited Partnership is a subsidiary of Cineplex Galaxy Income Fund.

Stock Exchange TSX Latest Fiscal Year 12/31/2008 Primary Industry Movies and Entertainment

Website http://www.cineplex.com Latest Fiscal Quarter 3/31/2009





52 Week High (6/11/08) 16.53 Beta 0.38

52 Week Low (10/06/08) 11.10 Float % 73.8%









TSX:CGX.UN YTD 12.9%

S&P 500 YTD 4.3%998 999 1000 2000











998 999 1000 2000 Diluted EPS 0.18 0.46 0.60 0.00 0.85 0.97

VALUATION MULTIPLES






P / E 81.8x 28.4x 31.8x 0.0x 18.2x 15.9x

P / BV 19.9x 40.5x NM 0.0x NA NA Balance Sheet Latest



EBITDA 50.9% 19.0% 3.6% 5.9% 5.4% 4.7% Total Equity 34.3 5.8 (38.1) (49.7)

Net Income (39.6%) 237.8% 30.6% 37.6% 39.7% 14.8%

EPS NM 162.8% 30.6% 0.0% 39.7% 14.8%




Jacob, Ellis Onex Corporation 14.6 25.60%


Nelson, Gord Cypress Capital Management Ltd. 4.6 7.97%

Mfc Global Investment Management 3.1 5.39%

Nonis, Paul Td Asset Management, Inc. 2.5 4.32%

Invesco Trimark Ltd 1.7 2.99%

Fitzgerald, Anne Guardian Capital Lp 1.3 2.35%


Selected Board Members Title Bissett Investment Management 1.2 2.15%

Munk, Anthony Mawer Investment Management Ltd. 0.8 1.33%

Jacob, Ellis Jacob, Ellis 0.2 0.38%

Beck, Howard Total Shares Outstanding 57.2 100.00%

Steacy, Robert

Duncanson, Timothy

Dea, Joan

Director, Chairman of Compensation, Nominating & Corporate Governance

Committee, Member of Audit Committee and Chairman of the Board of Trustees of

Director, Chairman of Audit Committee and Member of Compensation, Nominating &

Corporate Governance Committee

Director

Director


Senior Vice President and General Counsel

Chairman and Member of Compensation, Nominating & Corporate Governance

Committee


Income Statement

Cash Flow Statement



YOY Growth

51%

19%

4% 5% 5%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$50

$100

$150

$200

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

EBITDA TEV / EBITDA

Cineplex Entertainment Limited Partnership (TSX:CGX.UN) Price & Vol Chart

0.00

5.00

10.00

15.00

20.00

25.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-1,0002,0003,0004,0005,0006,0007,0008,000

(000)


C I N E P L E X E N T E R T A I N M E N T L I M I T E D P A R T N E R S H I P T S X : C G X . U N

98

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


CINRAM INTERNATIONAL INCOME FUND (TSX:CRW)

COMPANY INFORMATIONCinram International Income Fund, through its subsidiary, Cinram International, Inc., provides pre-recorded multimedia products and related logistics services in North America and Europe. The

company’s Home Video segment involves in the replication, packaging, and distribution of DVDs and Blu-ray discs, including new releases and catalog titles, for the home entertainment divisions of

motion picture studios. Cinram International Income Fund’s CD segment engages in the replication, packaging, and distribution of audio CDs and CD-ROMs for record labels, publishers, and software

companies. The company’s Video Game segment primarily distributes video games. In addition, Cinram International Income Fund provides logistics services. The company was founded in 1969 and is

headquartered in Toronto, Canada.


Website http://www.cinram.com Latest Fiscal Quarter 3/31/2009





52 Week High (6/10/08) 6.49 Beta 2.32

52 Week Low (3/03/09) 0.61 Float % NA









TSX:CRW YTD 13.2%

S&P 500 YTD 4.3%998 999 1000 2000









Other 0.0 Undrawn Term Loans 0.0 Margin (%) 7.2% 6.6% 5.3% 5.0% NA NATotal Principal Due 650.1 Other Available Credit 0.0 Net Income 51.8 (301.1) (31.5) (50.4) (9.2) (10.2)

Total Undrawn Credit 150.0 Margin (%) 2.7% (16.0%) (1.7%) (2.8%) (0.6%) (0.8%)

998 999 1000 2000 Diluted EPS 0.89 (5.12) (0.60) (1.05) (0.17) (0.19)

VALUATION MULTIPLES





TEV / EBIT 13.9x 10.6x 6.5x 6.3x NA NA Change in Cash 62.8 (84.3) 4.9 (26.6)




Total Revenue (%) (7.5%) (3.3%) 1.2% 1.3% (23.5%) (6.6%) Total Liabilities 1,262.5 1,373.6 1,188.7 1,028.7

EBITDA (10.3%) (10.8%) (20.5%) (18.4%) (35.6%) (12.5%) Total Equity 568.1 70.1 16.8 (8.3)

Net Income (37.2%) NM NM NM NM NM

EPS (37.4%) NM NM NM NM NM




Anderson, William

Bell, John

Ovadia, Jaime

Kern, Arthur


Anderson, William

Bell, John

Poile, Robert Total Shares Outstanding 55.3 100.00%

Normandeau, Robert

MacDonald, James

Bloomberg, Lawrence

Trustee, Chairman of Compensation Committee and Member of Audit Committee

Trustee, Chairman of Corporate Governance & Nominations Committee and Member

of Audit Committee

Trustee and Chairman of Audit Committee

Director

President of Cinram Americas - Cinram International Inc

President of Ivy Hill Corporation

Executive Chairman

Chief Financial Officer, Executive Vice President of Finance & Administration, Secretary

and Director of Cinram International Inc

Income Statement

Cash Flow Statement

Executive Chairman

Chief Financial Officer, Executive Vice President of Finance & Administration, Secretary

and Director of Cinram International Inc

YOY Growth

-10% -11%

-20%

-36%

-13%

(40.0%)

(35.0%)

(30.0%)

(25.0%)

(20.0%)

(15.0%)

(10.0%)

(5.0%)

0.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$50

$100

$150

$200

$250

$300

$350

$400

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

EBITDA TEV / EBITDA

Cinram International Income Fund (TSX:CRW) Price & Vol Chart

0.00

5.00

10.00

15.00

20.00

25.00

30.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

2,000

4,000

6,000

8,000

10,000

(000)


MOVIES & ENTERTAINMENT

C I N R A M I N T E R N A T I O N A L I N C O M E F U N D T S X : C R W

99

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


DHX MEDIA LTD. (TSX:DHX)

COMPANY INFORMATIONDHX Media, Ltd., through its subsidiaries, develops, produces, and distributes films and television programs in Canada and internationally. It focuses primarily on children’s, youth, and family

productions. The company has 15 children's series in first window broadcast on various cable and broadcast networks in North America and internationally, including The Mighty Jungle, Bo on the

Go!, Franny’s Feet, Chop Socky Chooks, Urban Vermin, and Naturally Sadie. DHX Media also maintains a library of approximately 2,190 half-hours of programming and 50 individual titles, as well as a

prime-time production known as comedy series This Hour Has 22 Minutes. The company was incorporated in 2004 and is headquartered in Halifax, Canada.


Website http://www.dhxmedia.com Latest Fiscal Quarter 3/31/2009





52 Week High (6/10/08) 1.65 Beta 0.87

52 Week Low (12/12/08) 0.35 Float % 64.4%









TSX:DHX YTD 51.6%

S&P 500 YTD 4.3%998 999 1000 2000









Other 0.0 Undrawn Term Loans 0.0 Margin (%) 0.4% 2.7% 4.1% 5.9% NA NATotal Principal Due 53.7 Other Available Credit 0.0 Net Income (0.9) 1.2 (1.0) (1.8) 6.0 4.5

Total Undrawn Credit 28.0 Margin (%) (5.8%) 4.6% (2.0%) (2.8%) 7.0% 5.5%

998 999 1000 2000 Diluted EPS (0.06) 0.03 (0.03) (0.02) 0.14 0.10

VALUATION MULTIPLES




TEV / EBITDA NM 112.7x 14.9x 13.9x 15.0x 5.0x Cash from Finaning 10.0 17.1 19.7 14.6

TEV / EBIT NM NM 24.0x 23.6x NA NA Change in Cash (0.5) (2.7) 5.4 (2.6)

P / E NM 69.1x 26.8x NM 5.2x 6.9x



Total Revenue (%) (24.6%) 64.9% 101.9% 29.5% 63.5% (5.4%) Total Liabilities 38.2 61.5 85.7 96.8

EBITDA NM 1143.2% 112.1% (6.5%) 18.7% 197.3% Total Equity 39.6 41.5 58.2 60.5

Net Income NM NM NM NM NM (25.2%)

EPS NM NM NM NM NM (25.2%)




Donavan, Michael Pyramis Global Advisors, Llc 1.5 3.59%


DeNure, Steven Seamark Asset Management Ltd. 0.5 1.09%

Agf Management Ltd. 0.3 0.73%

Landry, Dana Foyston, Gordon & Payne Inc. 0.1 0.12%

Bishop, Charles


Donavan, Michael

DeNure, Steven Donovan, Michael 7.0 16.31%

Bishop, Charles Total Shares Outstanding 42.9 100.00%

Wright, Donald

Day, Judson

Medjuck, Joseph

President of Production and Development, Director, Member of Production Financing

Committee and President of Halifax Film Division


Member of Nominating & Governance Committee

Lead Director, Chairman of Nominating & Governance Committee, Member of

Production Financing Committee, Member of Audit Committee and Member of

Director, Member of Audit Committee, Member of Compensation Committee and



President of Production and Development, Director, Member of Production Financing

Committee and President of Halifax Film Division

Chairman, Chief Executive Officer and Member of Production Financing Committee

President, Chief Operating Officer, Director and President of Decode Entertainment Inc

Income Statement

Cash Flow Statement

Chairman, Chief Executive Officer and Member of Production Financing Committee

President, Chief Operating Officer, Director and President of Decode Entertainment Inc

YOY Growth

0%

1143%

112%19%

197%

0.0%

200.0%

400.0%

600.0%

800.0%

1000.0%

1200.0%

1400.0%

6/30/2006 6/30/2007 6/30/2008 2009E 2010E

EBITDA

Valuation

$0

$5

$10

$15

$20

6/30/2006 6/30/2007 6/30/2008 2009E 2010E

(in

$ m

illions)

0.0x

20.0x

40.0x

60.0x

80.0x

100.0x

120.0x

EBITDA TEV / EBITDA

DHX Media Ltd. (TSX:DHX) Price & Vol Chart

0.00

0.50

1.00

1.50

2.00

2.50

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/19/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/12/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/25/2008

8/6/2008

9/16/2008

10/27/2008

12/1/2008

1/13/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

200

400

600

800

1,000

1,200

(000)


D H X M E D I A L T D . T S X : D H X

100

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


ENTERTAINMENT ONE LTD. (AIM:ETO)

COMPANY INFORMATIONEntertainment One, Ltd. owns and distributes film and entertainment content in Canada, the United Kingdom, Europe, and the United States. The company engages in wholesaling and specialty

retailing home entertainment products with a library of 30,000 DVD titles and a CD catalogue of 12,000 items. It has an Internet fulfillment wholesale business of home entertainment products, and an

Internet retail sales division called cdplus.com. The company also operates approximately 82 specialty retail stores that offer CDs, DVDs, video games, and accessories in Canadian secondary markets.

In addition, Entertainment One acquires, owns, and distributes film, music, and TV rights. The company was founded in 1973 and is based in Brampton, Canada.

Stock Exchange AIM Latest Fiscal Year 3/31/2008 Primary Industry Movies and Entertainment

Website http://www.entertainmentone.ca Latest Fiscal Quarter 9/30/2008





52 Week High (6/06/08) 0.90 Beta 1.45

52 Week Low (3/06/09) 0.13 Float % 57.0%









AIM:ETO YTD 13.2%

S&P 500 YTD 4.3%998 999 1000 2000








Trust Preferred 0.0 Undrawn Revolver 14.3 Margin (%) 4.5% 4.8% 7.5% 7.5% 7.2% 7.3%Capital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT 5.9 6.3 (1.2) (1.2) NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) 1.1% 1.2% (0.6%) (0.6%) NA NATotal Principal Due 63.9 Other Available Credit 0.0 Net Income (68.6) (41.9) (6.8) (6.8) 11.7 15.1

Total Undrawn Credit 14.3 Margin (%) (13.2%) (7.9%) (3.2%) (3.2%) 3.5% 3.7%

998 999 1000 2000 Diluted EPS (2.87) (1.48) (0.08) (0.08) 0.08 0.10

VALUATION MULTIPLES




TEV / EBITDA 0.0x 0.0x 12.4x 8.2x 5.3x 4.4x Cash from Finaning 50.8 (2.3) 133.2 133.2

TEV / EBIT 0.0x 0.0x 149.1x NM NA NA Change in Cash (8.0) 1.4 13.2 13.2

P / E 0.0x 0.0x NM NM 3.8x 2.9x




EBITDA (20.0%) 8.8% 0.0% 0.0% 53.3% 22.7% Total Equity 147.4 97.6 123.6 123.6

Net Income NM NM 0.0% 0.0% NM 28.9%

EPS NM NM 0.0% 0.0% NM 28.9%




Throop, Darren Marwyn Investment Management Llp 57.8 39.33%

F&C Asset Managers Limited 1.5 1.05%

Willets, Giles Gam Fund Management Limited 1.5 0.99%

Ncl Securities Ltd. 0.2 0.10%

Theroux, Patrice

Koch, Michael


Williams, David

Throop, Darren Throop, Darren 4.2 2.86%

Willets, Giles Total Shares Outstanding 146.9 100.00%

McQueen, Catherine

Kovnats, Martin

Theroux, Patrice

Chief Financial Officer, Director and Member of Acquisitions Committee

Trustee, Chairman of Compensation & Corporate Governance Committee, Member of

Special Committee, Corporate Director of ROW GP and Trustee of ROW CT

Trustee of ROW Commercial Trust

Executive Director , Member of Acquisitions Committee and President of Filmed

Entertainment

Executive Director , Member of Acquisitions Committee and President of Filmed

Entertainment

Chief Executive Officer of Koch LP

Non-Executive Chairman, Chairman of Remuneration Committee and Member of

Audit Committee

Chief Executive Officer, President, Director, Chairman of Acquisitions Committee,

Member of Disclosure Committee, Chief Executive Officer of ROW GP, Chief Executive

ffi f d h d f d f d

Income Statement

Cash Flow Statement

Chief Executive Officer, President, Director, Chairman of Acquisitions Committee,

Member of Disclosure Committee, Chief Executive Officer of ROW GP, Chief Executive

ffi f d h d f d f dChief Financial Officer, Director and Member of Acquisitions Committee

YOY Growth

-20%

9%0%

53%

23%

(40.0%)

(20.0%)

0.0%

20.0%

40.0%

60.0%

12/31/2005 12/31/2006 3/31/2008 2009E 2010E

EBITDA

Valuation

$0

$5

$10

$15

$20

$25

$30

$35

12/31/2005 12/31/2006 3/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

EBITDA TEV / EBITDA

Entertainment One Ltd. (AIM:ETO) Price & Vol Chart

0.000.200.400.600.801.001.201.40

0 0 0 0 0

3/30/2007

5/11/2007

6/20/2007

8/3/2007

9/11/2007

10/8/2007

11/23/2007

1/14/2008

2/8/2008

4/1/2008

5/16/2008

6/20/2008

7/22/2008

8/29/2008

10/24/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

200

400

600

800

1,000

1,200

(000)


E N T E R T A I N M E N T O N E L T D . A I M : E T O

101

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


E-SOL INTERNATIONAL CORP. (OTCPK:ESIT)

COMPANY INFORMATIONE-SOL International Corporation engages in the production and marketing of movies, documentaries, and television programs in Canada. The company is based in Toronto, Canada.

Stock Exchange OTCPK Latest Fiscal Year 12/31/2008 Primary Industry Movies and Entertainment

Website http://www.torontopictures.com Latest Fiscal Quarter 3/31/2009





52 Week High (12/11/08) 5.40 Beta 0.26

52 Week Low (7/16/08) 1.11 Float % NA







Enterprise Value (44.2) Last 6 Months 0.0


OTCPK:ESIT YTD 11.0%

S&P 500 YTD 4.3%998 999 1000 2000







Sub Bonds and Notes 0.0 EBITDA 0.0 (0.4) (1.7) (2.4) NA NA

Trust Preferred 0.0 Undrawn Revolver 0.0 Margin (%) 0.0% (4229.4%) (5214.0%) (6448.3%) NA NACapital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT (0.4) (0.4) (1.7) (2.4) NA NA



998 999 1000 2000 Diluted EPS (0.01) (0.01) (0.03) (0.05) NA NA

VALUATION MULTIPLES



TEV / Revenue 0.0x NM NM NM NA NA Cash from Investing 0.0 0.0 0.0 0.0


TEV / EBIT 0.0x NM NM NM NA NA Change in Cash 0.0 0.0 0.0 0.0




Total Revenue (%) 0.0% (97.7%) 288.2% 829.8% NA NA Total Liabilities 3.7 3.5 5.9 6.3

EBITDA 0.0% 0.0% NM 0.0% NA NA Total Equity 86.8 87.0 85.6 84.9

Net Income 0.0% NM NM NM NA NA

EPS 0.0% NM NM NM NA NA




Remington, Robert

Pischiutta, Bruno

Westlake, Eric

Braslau, Sam


Remington, Robert

Trifu, Daria

Total Shares Outstanding 10.0 100.00%


Legal Counsel

Chief Executive Officer and Director

Vice President and Director

Income Statement

Cash Flow Statement


President

YOY Growth

0% 0% 0% 0% 0%0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

($2)

($2)

($1)

($1)

$0

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

0.2x

0.4x

0.6x

0.8x

1.0x

EBITDA TEV / EBITDA

E-SOL International Corp. (OTCPK:ESIT) Price & Vol Chart

0.001.002.003.004.005.006.007.008.009.00

9/6/2006

10/18/2006

11/30/2006

1/10/2007

2/16/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

8/17/2007

10/19/2007

11/16/2007

1/11/2008

2/22/2008

3/13/2008

5/15/2008

6/26/2008

7/22/2008

9/9/2008

10/16/2008

12/3/2008

12/22/2008

2/27/2009

3/17/2009

4/27/2009

($)

-

20

40

60

80

100

120

(000)


E S O L I N T E R N A T I O N A L C O R P. O T C P K : E S I T

102

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


FLUID MUSIC CANADA, INC. (TSX:FMN)

COMPANY INFORMATIONFluid Music, Inc., a private label music aggregation and distribution company, together with it subsidiaries, provides music products and services to business and individual consumers. It

provides digital music programming and broadcasting services on a subscription basis, including programming music on standard or customized bases, targeted music, messaging, and telephone music on hold

to retailers, restaurants, department stores, hotels, and business offices. The company has a music library of approximately five million digital rights management-free songs compiled from a

network of producers, including major record labels, independent, and emerging artists. Fluid Music also engages in the sale of digital music to online and offline customers. In addition, it provides

advertising and promotional programs, including MuzAd, a music driven advertising methodology that integrates music tracks with a customized advertisement and enables the advertiser the power of

music to engage a captive targeted audience. Fluid Music offers digital background music to its clients through direct sales force, value-added reseller arrangements, and its Web site. The

company, formerly known as Fluid Media Networks, Inc., was founded in 2004 and is headquartered in Culver City, California.


Website http://www.fluidmedianetworks.coLatest Fiscal Quarter 3/31/2009






52 Week Low (12/10/08) 0.17 Float % NA









TSX:FMN YTD 110.8%

S&P 500 YTD 4.3%998 999 1000 2000







Sub Bonds and Notes 0.0 EBITDA (5.4) (5.2) (9.3) (6.9) (7.2) (7.3)

Trust Preferred 0.0 Undrawn Revolver 0.0 Margin (%) (232.1%) (485.9%) (199.7%) (138.1%) (144.0%) (115.9%)Capital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT (5.8) (6.5) (11.7) (9.3) NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) (251.8%) (611.4%) (251.4%) (187.3%) NA NATotal Principal Due 0.2 Other Available Credit 0.0 Net Income (6.2) (10.0) (19.4) (17.2) (13.7) (9.5)

Total Undrawn Credit 0.0 Margin (%) (267.0%) (929.9%) (418.0%) (343.8%) (273.1%) (150.1%)

998 999 1000 2000 Diluted EPS (1.50) (0.62) (0.43) (0.36) (0.26) (0.18)

VALUATION MULTIPLES



TEV / Revenue 0.0x 0.0x 0.0x 3.8x 4.8x 3.8x Cash from Investing (2.0) (5.1) (0.1) 0.3


TEV / EBIT 0.0x 0.0x NM NM NA NA Change in Cash (0.0) 0.5 14.6 13.5




Total Revenue (%) 5050.3% (53.6%) 333.6% 158.3% 7.7% 26.0% Total Liabilities 1.7 9.1 5.8 5.2

EBITDA NM NM NM NM NM NM Total Equity 0.3 1.3 15.2 13.7






Beckett, Justin Pyramis Global Advisors, Llc 3.0 5.62%


Abony, Lorne Agf Management Ltd. 0.6 1.11%

Selective Asset Management Inc 0.2 0.35%

Lanthier, James Foyston, Gordon & Payne Inc. 0.1 0.15%

Front Street Investment Management Inc. 0.0 0.02%

O'neill, Daniel


Abony, Lorne

Beckett, Justin

Lanthier, James Total Shares Outstanding 52.5 100.00%

Rheaume, Alain

Arseneau, Marc

Brosseau, André


Nominee Director

Nominee Director

Nominee Director


Chief Technology Officer


Co-Founder, President, Chief Operating Officer and Director

Income Statement

Cash Flow Statement

Co-Founder, President, Chief Operating Officer and Director


YOY Growth

0% 0% 0% 0% 0%0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

($10)

($8)

($6)

($4)

($2)

$0

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

0.2x

0.4x

0.6x

0.8x

1.0x

EBITDA TEV / EBITDA

Fluid Music Canada, Inc. (TSX:FMN) Price & Vol Chart

0.00

0.50

1.00

1.50

2.00

2.50

0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

6/26/2008

8/6/2008

9/16/2008

10/23/2008

12/5/2008

1/16/2009

2/27/2009

4/8/2009

5/20/2009

($)

-2004006008001,0001,2001,400

(000)


F L U I D M U S I C C A N A D A , I N C . T S X : F M N

103

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


FRV MEDIA, INC. (TSXV:FRV)

COMPANY INFORMATIONFRV Media, Inc., along with its subsidiaries, engages in the development, production, marketing, and distribution of audiovisual content across television, cinema, and multimedia platforms. The

company creates television series, made-for-television movies, feature films, sitcoms, youth programs, children’s programs, documentaries, and magazine-style series. It also distributes youth and

family films, as well as licensed products, such as DVDs in Canada and the United States. In addition, FRV distributes a library of audiovisual productions in Latin America, Europe, the Middle

East, Africa, and Asia. The company is based in Montreal, Canada.

Stock Exchange TSXV Latest Fiscal Year 10/31/2007 Primary Industry Movies and Entertainment

Website http://www.frvmedia.com Latest Fiscal Quarter 7/31/2008





52 Week High (4/30/08) 0.00 Beta (0.25)

52 Week Low (2/02/09) 0.00 Float % 78.1%









TSXV:FRV YTD (50.0%)

S&P 500 YTD 4.3%998 999 1000 2000











998 999 1000 2000 Diluted EPS (0.04) (0.08) (0.08) (0.08) NA NA

VALUATION MULTIPLES


3/31/2006 3/31/2007 10/31/2007 10/31/2007 2008E 2009E Cash from Operations 0.4 (2.5) (6.1) (6.1)

TEV / Revenue 1.2x 1.1x 0.0x 0.7x NA NA Cash from Investing 1.9 0.5 (0.7) (0.7)

TEV / EBITDA NM NM 0.0x NM NA NA Cash from Finaning (2.8) 2.7 6.6 6.6

TEV / EBIT NM NM 0.0x NM NA NA Change in Cash (0.5) 0.6 (0.3) (0.3)

P / E NM NM 0.0x NM NA NA




EBITDA NM NM 0.0% 0.0% NA NA Total Equity 4.4 2.0 0.3 0.3

Net Income NM NM 0.0% 0.0% NA NA

EPS NM NM 0.0% 0.0% NA NA




Laferrière, Richard Fonds De Solidarité Ftq 5.0 8.08%

Natcan Investment Management Inc. 1.6 2.53%

Richard, Lorraine

Dufour, Alain

Lassonde, Carolyne


Laferrière, Richard

Richard, Lorraine Laferrière, Richard 5.1 8.29%

Guiry, Gordon Total Shares Outstanding 61.8 100.00%

Dolbec, Jean

Laurencelle, Suzanne

Gagnon, Regent

Director, Chairman of Compensation & Human Resources Committee and Member of

Corporate Governance & Nominating Committee

Director, Chairman of Audit Committee and Member of Compensation & Human

Resources Committee


Director


Secretary and Legal Counsel


Interim President, Director, Member of Audit Committee and President of Cite-

Amerique

Income Statement

Cash Flow Statement


Interim President, Director, Member of Audit Committee and President of Cite-

Amerique

YOY Growth

0% 0% 0% 0% 0%0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

3/31/2006 3/31/2007 10/31/2007 2008E 2009E

EBITDA

Valuation

($3)

($3)

($2)

($2)

($1)

($1)

$0

3/31/2006 3/31/2007 10/31/2007 2008E 2009E

(in

$ m

illions)

0.0x

0.2x

0.4x

0.6x

0.8x

1.0x

EBITDA TEV / EBITDA

FRV Media, Inc. (TSXV:FRV) Price & Vol Chart

0.00

0.05

0.10

0.15

0.20

0.25

0.30

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/9/2007

3/29/2007

5/4/2007

6/15/2007

6/15/2007 0 0 0 0 0 0

5/15/2008

6/23/2008

7/31/2008

9/16/2008

10/10/2008

11/26/2008

12/22/2008

2/26/2009

2/26/2009

2/26/2009

($)

-50100150200250300350400

(000)


F R V M E D I A , I N C . T S X V : F R V

104

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


IMAX CORPORATION (NASDAQGM:IMAX)

COMPANY INFORMATIONIMAX Corporation, together with its subsidiaries, operates as an entertainment technology company worldwide. The company specializes in motion picture technologies and large-format film

presentations. It engages in the design, manufacture, sale, and lease of large-format digital and film-based theater systems; and the conversion of two-dimensional (2D) and three-dimensional (3D)

Hollywood feature films for exhibition on such systems. The company’s theater systems are based on proprietary and patented technology for large-format digital projectors and large-format 15-perforation

film frame, and 70mm format projectors. It serves theater exhibitors that operate commercial theaters, such as multiplexes; and museums, science centers, and destination entertainment sites. The

company also engages in the production and distribution of original large-format films; provision of post-production services for large-format films; operation of a small number of IMAX theaters;

and provision of services in support of IMAX theaters and the IMAX theater network, as well as rents 2D and 3D large-format analog cameras. As of December 31, 2008, it operated 351 theater

systems comprising 231 commercial and 120 institutional operating in 42 countries. The company was founded in 1967 and is headquartered in Mississauga, Canada.

Stock Exchange NasdaqGM Latest Fiscal Year 12/31/2008 Primary Industry Movies and Entertainment

Website http://www.imax.com Latest Fiscal Quarter 3/31/2009





52 Week High (7/18/08) 8.28 Beta 1.68

52 Week Low (11/21/08) 2.41 Float % 76.8%

Total Basic Common Shares 53.5 Shares Sold Short 2.2

Market Capitalization 398.8 Days Cover Short 7.6







NASDAQGM:IMAX YTD 67.0%

S&P 500 YTD 4.3%998 999 1000 2000







Sub Bonds and Notes 0.0 EBITDA 4.7 (12.9) (13.0) (4.6) 42.0 69.0

Trust Preferred 0.0 Undrawn Revolver 20.3 Margin (%) 3.9% (11.8%) (12.9%) (4.2%) 29.1% 41.3%Capital Leases 0.3 Undrawn Commercial Paper 0.0 EBIT (0.7) (18.8) (21.3) (13.6) NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) (0.6%) (17.2%) (21.1%) (12.2%) NA NATotal Principal Due 180.3 Other Available Credit 0.0 Net Income (16.8) (26.9) (33.6) (26.0) (0.5) 16.8

Total Undrawn Credit 20.3 Margin (%) (13.8%) (24.8%) (33.3%) (23.3%) (0.4%) 10.0%

998 999 1000 2000 Diluted EPS (0.45) (0.72) (0.79) (0.60) (0.01) 0.31

VALUATION MULTIPLES




TEV / EBITDA 14.0x NM NM NM 11.5x 7.0x Cash from Finaning 0.3 (1.3) 39.0 39.6

TEV / EBIT 23.9x NM NM NM NA NA Change in Cash 0.8 (8.2) 10.1 0.7

P / E NM NM NM NM NA 23.5x

P / BV NM NM NM NM NA NA Balance Sheet Latest


Total Revenue (%) 6.6% (11.0%) (7.1%) 5.5% 42.7% 16.0% Total Liabilities 285.5 293.4 325.4 325.5

EBITDA (59.3%) NM NM NM NM 64.4% Total Equity (58.2) (85.4) (96.8) (98.5)






Gelfond, Richard First Wilshire Securities Management, Inc. 2.9 5.39%

Pequot Capital Management Inc. 2.5 4.67%

Foster, Greg Mfc Global Investment Management (U.S.), Llc 1.6 3.02%

Hedgehog Capital Llc 1.6 2.93%

Sparacio, Joseph M&I Investment Management Corp. 1.5 2.75%

William Blair Investment Management 1.0 1.95%

Lister, Robert Stephens Capital Management 0.8 1.47%

Driehaus Capital Management Llc 0.5 0.85%

Selected Board Members Title Falcon Investment Management, Llc 0.4 0.75%

Wechsler, Bradley Perritt Capital Management, Inc. 0.4 0.66%

Gelfond, Richard Douglas, Kevin 8.6 16.11%

Foster, Greg Total Shares Outstanding 53.5 100.00%

Copland, Kenneth

Girvan, Garth

Leebron, David

Chairman of Filmed Entertainment and President of Filmed Entertainment



Director, Chairman of Compensation Committee, Member of Option Committee and


Director, Chairman of Nominating Committee, Chairman of Corporate Governance

Committee, Member of Audit Committee and Member of Compensation Committee


Senior Executive Vice President and General Counsel

Chairman


Income Statement

Cash Flow Statement


Chairman of Filmed Entertainment and President of Filmed Entertainment

YOY Growth

-59%

0% 0% 0%

64%

(80.0%)

(60.0%)

(40.0%)

(20.0%)

0.0%

20.0%

40.0%

60.0%

80.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

($20)

$0

$20

$40

$60

$80

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

EBITDA TEV / EBITDA

IMAX Corporation (NASDAQGM:IMAX) Price & Vol Chart

0.001.002.003.004.005.006.007.008.009.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

2,000

4,000

6,000

8,000

10,000

(000)


I M A X C O R P O R A T I O N N A S D A Q G M : I M A X

105

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


KNIGHTSCOVE MEDIA CORP. (TSXV:KC.A)

COMPANY INFORMATIONKnightscove Media Corp., together with its subsidiaries, engages in the distribution, acquisition, creation, and financing of live action feature films and television productions under

‘Knightscove Family Films’ name. It also acquires, develops, and distributes family friendly film and television product for theatrical, home video/DVD, pay, specialty television, video-on-demand, and

broadband broadcast markets in North America and internationally. In addition, the company provides programming, such as family, drama, fitness, and documentary. Its library consists of approximately

1,400 DVD titles. Knightscove Media Corp. is based in Toronto, Canada.

Stock Exchange TSXV Latest Fiscal Year 8/31/2008 Primary Industry Movies and Entertainment

Website http://www.knightscove.com Latest Fiscal Quarter 2/28/2009






52 Week Low (12/08/08) 0.01 Float % 58.0%









TSXV:KC.A YTD 33.3%

S&P 500 YTD 4.3%998 999 1000 2000











998 999 1000 2000 Diluted EPS (0.06) (0.10) (0.02) (0.02) NA NA

VALUATION MULTIPLES


12/31/2006 8/31/2007 8/31/2008 2/28/2009 2009E 2010E Cash from Operations (0.2) (0.4) 0.3 0.4



TEV / EBIT 0.0x 0.0x NM NM NA NA Change in Cash (0.1) (0.1) (0.0) 0.0





EBITDA NM 0.0% NM 0.0% NA NA Total Equity 0.1 0.6 0.5 0.5

Net Income NM 0.0% NM 0.0% NA NA

EPS NM 0.0% NM 0.0% NA NA




Bristow, Leif Potomac Capital Management Inc. 2.0 8.83%

Mavrix Fund Management Inc. 0.3 1.33%

Grot, Annette

Moring, Ronald

Taylor, Melissa


Bristow, Leif

Moring, Ronald Bristow, Leif 3.1 13.71%

Levine, Michael Total Shares Outstanding 22.7 100.00%

Ferreira, Rick

Ewart, Jason

Lane, John





Director, Member of Compensation Committee and Member of Nominating &


President of Morningstar Entertainment and Director

Vice President of Business & Legal Affairs and Secretary


President of Morningstar Entertainment and Director

Income Statement

Cash Flow Statement


Chief Financial Officer and Vice President of Finance

YOY Growth

0% 0% 0% 0% 0%0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

12/31/2006 8/31/2007 8/31/2008 2009E 2010E

EBITDA

Valuation

($2)

($1)

($1)

($1)

($1)

($1)

($0)

($0)

$0

12/31/2006 8/31/2007 8/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

0.2x

0.4x

0.6x

0.8x

1.0x

EBITDA TEV / EBITDA

Knightscove Media Corp. (TSXV:KC.A) Price & Vol Chart

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0 0 0 0 0 0 0 0 0 0 0 0 0 0

3/31/2008

5/13/2008

6/18/2008

8/6/2008

9/11/2008

10/16/2008

12/2/2008

1/15/2009

2/5/2009

3/31/2009

5/13/2009

($)

-

100

200

300

400

500

(000)


K N I G H T S C O V E M E D I A C O R P. T S X V : K C . A

106

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


LIONS GATE ENTERTAINMENT CORP. (NYSE:LGF)

COMPANY INFORMATIONLions Gate Entertainment Corp. operates as a filmed entertainment studio. It offers motion pictures, television programming, home entertainment, family entertainment, and video-on-demand and

digitally developed content. The company operates through three segments: Motion Pictures, Television Production, and Media Networks. The Motion Pictures segment engages in the development and

production of feature films; acquisition of North American and worldwide distribution rights; North American theatrical, home entertainment, and television distribution of feature films produced and

acquired; and worldwide licensing of distribution rights to feature films produced and acquired. The Television Production segment involves in the development, production, and worldwide

distribution of television productions, including television series, television movies and mini-series, and non-fiction programming. The Media Networks segment consists of TV Guide Network, a general

entertainment cable network in the United States, including TV Guide Network On Demand; and TV Guide Online, an online navigational tool, as well as provider of television listings, and video and other

entertainment content. This segment also provides programming distribution rights to multi-system cable operators and digital broadcast satellite providers; and sells advertising on its

television channel and related online media platforms. As of June 1, 2009, it distributed a library of 12,000 motion picture and television titles directly to retailers, video rental stores, and pay and

free television channels in the United States, Canada, the United Kingdom, and Ireland; and through various digital media platforms, and indirectly to other international markets through

subsidiaries and various third parties. Lions Gate Entertainment Corp. was founded in 1986 and is headquartered in Vancouver, Canada.

Stock Exchange NYSE Latest Fiscal Year 3/31/2008 Primary Industry Movies and Entertainment

Website http://www.lionsgatefilms.com Latest Fiscal Quarter 12/31/2008





52 Week High (8/11/08) 10.97 Beta 0.93

52 Week Low (2/10/09) 3.65 Float % 76.9%









NYSE:LGF YTD (0.5%)

S&P 500 YTD 4.3%998 999 1000 2000






Snr Bonds and Notes 0.0 Total Debt 328.7 Revenue 945.4 976.7 1,361.0 1,514.7 1,455.2 1,552.6

Sub Bonds and Notes 325.0 EBITDA 19.2 45.6 (54.6) (77.9) (121.7) 60.4

Trust Preferred 0.0 Undrawn Revolver 192.3 Margin (%) 2.0% 4.7% (4.0%) (5.1%) (8.4%) 3.9%Capital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT 15.3 41.9 (60.1) (84.2) NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) 1.6% 4.3% (4.4%) (5.6%) NA NATotal Principal Due 328.7 Other Available Credit 0.0 Net Income 6.1 27.5 (74.0) (104.6) (146.2) 17.4

Total Undrawn Credit 192.3 Margin (%) 0.6% 2.8% (5.4%) (6.9%) (10.0%) 1.1%

998 999 1000 2000 Diluted EPS 0.02 0.25 (0.62) (0.89) (1.25) 0.15

VALUATION MULTIPLES



TEV / Revenue 1.6x 1.7x 1.1x 0.5x 0.6x 0.5x Cash from Investing (165.3) (107.6) 201.3 (51.9)

TEV / EBITDA 81.2x 30.9x NM NM NA 13.6x Cash from Finaning 44.7 52.4 28.4 (80.5)

TEV / EBIT 116.2x 33.5x NM NM NA NA Change in Cash (65.9) 4.5 320.1 (52.8)

P / E NM 29.7x NM NM NA 36.4x




EBITDA (63.8%) 138.0% NM NM NM NM Total Equity 149.3 247.9 188.2 11.5

Net Income (69.9%) 350.8% NM NM NM NM

EPS (92.1%) 1519.0% NM NM NM NM




Feltheimer, Jon Mhr Fund Management Llc 23.2 19.79%

Steinberg Asset Management, Llc 17.8 15.21%

Beeks, Steve Icahn Associates Corp. 16.8 14.35%

Capital Research Global Investors 11.0 9.40%

Keegan, James Rs Investments 7.4 6.29%

Great Plains Trust Company 5.7 4.91%

Levin, Wayne Janus Capital Management Llc 3.3 2.85%

The Vanguard Group, Inc. 3.3 2.78%

Selected Board Members Title Kornitzer Capital Management, Inc. 2.4 2.01%

Feltheimer, Jon Clearbridge Advisors, Llc 2.2 1.90%

Ludwig, Harald Amin, Mark 1.7 1.41%

Burns, Michael Total Shares Outstanding 117.0 100.00%

Amin, Mark

Burns, Michael

Koffman, Morley

Vice Chairman

Vice Chairman and Member of Strategic Advisory Committee

Vice Chairman

Independent Director, Chairman of Nominating & Corporate Governance Committee

and Member of Audit Committee

Chief Administrative Officer, Chief Financial Officer and Chief Accounting Officer

Executive Vice President of Corporate Operations, General Counsel and President of

FilmCo

Co-Chairman and Chief Executive Officer

Co-Chairman and Chairman of Strategic Advisory Committee

Income Statement

Cash Flow Statement

Co-Chairman and Chief Executive Officer

President, Co-Chief Operating Officer and President of Lions Gate Entertainment Inc

YOY Growth

-64%

138%

0% 0% 0%

(100.0%)

(50.0%)

0.0%

50.0%

100.0%

150.0%

3/31/2006 3/31/2007 3/31/2008 2009E 2010E

EBITDA

Valuation

($150)

($100)

($50)

$0

$50

$100

3/31/2006 3/31/2007 3/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

20.0x

40.0x

60.0x

80.0x

100.0x

EBITDA TEV / EBITDA

Lions Gate Entertainment Corp. (NYSE:LGF) Price & Vol Chart

0.002.004.006.008.0010.0012.0014.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

2,000

4,000

6,000

8,000

10,000

(000)


L I O N S G A T E E N T E R T A I N M E N T C O R P. N Y S E : L G F

107

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


PEACE ARCH ENTERTAINMENT GROUP INC. (AMEX:PAE)

COMPANY INFORMATIONPeace Arch Entertainment Group, Inc., an integrated media company, produces, acquires, and distributes feature films, television, and home entertainment content worldwide. It operates in three

segments: Motion Picture, Television, and Home Entertainment. The Motion Picture segment produces feature films, which are intended for DVD or television premieres, as well as for worldwide

theatrical release; licenses distribution rights of productions to sub-distributors; and distributes a catalogue of approximately 1,000 titles. The Television segment licenses television films, series

of episodes, documentaries, and other programming to broadcasters, cable and satellite television providers, and home entertainment distributors. This segment also provides made-for-television

movies and mini-series. The Home Entertainment segment distributes DVDs and ancillary merchandise to retailers in Canada and the United States. This segment also distributes sell-through and rental

films of various genres, such as children’s and family, special interest, and live action feature films. The company was founded in 1986. It was formerly known as Vidatron Enterprises, Ltd. and

changed its name to Peace Arch Entertainment Group, Inc. in 1999. Peace Arch Entertainment Group is headquartered in Toronto, Canada.

Stock Exchange AMEX Latest Fiscal Year 8/31/2007 Primary Industry Movies and Entertainment

Website http://www.peacearch.com Latest Fiscal Quarter 5/31/2008





52 Week High (6/24/08) 0.69 Beta 2.59

52 Week Low (3/06/09) 0.01 Float % 81.4%


Market Capitalization 4.0 Days Cover Short NM







AMEX:PAE YTD 46.8%

S&P 500 YTD 4.3%998 999 1000 2000







Sub Bonds and Notes 0.0 EBITDA (1.6) (2.3) 4.4 (3.0) NA NA

Trust Preferred 0.0 Undrawn Revolver 0.0 Margin (%) (15.2%) (11.0%) 7.0% (4.1%) NA NACapital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT (1.7) (2.7) 3.5 (4.3) NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) (15.9%) (12.6%) 5.7% (6.0%) NA NATotal Principal Due 42.2 Other Available Credit 0.0 Net Income 1.4 (4.6) (5.7) (16.4) NA NA

Total Undrawn Credit 0.0 Margin (%) 13.5% (21.7%) (9.2%) (22.4%) NA NA

998 999 1000 2000 Diluted EPS 0.08 (0.21) (0.17) (0.35) NA NA

VALUATION MULTIPLES




TEV / EBITDA NM NM 25.5x NM NA NA Cash from Finaning 5.4 25.1 42.2 31.7

TEV / EBIT NM NM 28.8x NM NA NA Change in Cash (0.1) (0.2) 3.9 0.6

P / E NM NM 41.2x NM NA NA



Total Revenue (%) (49.4%) 97.8% 190.7% 25.3% NA NA Total Liabilities 41.8 66.1 103.1 127.1







Flock, John Ing Investment Management, Inc. 1.0 1.92%

Mavrix Fund Management Inc. 0.8 1.68%

Di Pasquale, Mara Ing Furman Selz Capital Management, Llc 0.3 0.60%


Meyerowitz, Berry Renaissance Technologies Corp. 0.0 0.06%

Weston Capital Management Inc. 0.0 0.02%

Webb, Lewin


Essery, Robert

Flock, John Watson, Richard 1.3 2.51%

Watson, Richard Total Shares Outstanding 49.8 100.00%

Jones, Juliet

Fodie, Ian

Craig, J.

Secretary, Legal Counsel, Director, Chairman of Executive & Corporate Governance

Committee and Member of Greenlight Committee


Member of Executive & Corporate Governance Committee

Independent Director, Member of Audit Committee and Member of Compensation

Committee

Director and Member of Compensation Committee

President of Peace Arch Home Entertainment Inc

President of Peace Arch Motion Pictures Inc and Head of Production - Peace Arch

Motion Pictures Inc

Chairman, Member of Executive & Corporate Governance Committee and Member of

Audit Committee

President, Chief Operating Officer, Director, Member of Greenlight Committee and

President of Peace Arch LA Inc

Income Statement

Cash Flow Statement

President, Chief Operating Officer, Director, Member of Greenlight Committee and

President of Peace Arch LA Inc


YOY Growth

0% 0% 0% 0% 0%0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

8/31/2005 8/31/2006 8/31/2007 2008E 2009E

EBITDA

Valuation

($3)

($2)

($1)

$0

$1

$2

$3

$4

$5

8/31/2005 8/31/2006 8/31/2007 2008E 2009E

(in

$ m

illions)

0.0x

5.0x

10.0x

15.0x

20.0x

25.0x

30.0x

EBITDA TEV / EBITDA

Peace Arch Entertainment Group Inc. (AMEX:PAE) Price & Vol Chart

0.000.501.001.502.002.503.003.50

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

200

400

600

800

1,000

1,200

(000)


P E A C E A R C H E N T E R T A I N M E N T G R O U P I N C . A M E X : P A E

108

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


RAINMAKER ENTERTAINMENT INC. (TSX:RNK)

COMPANY INFORMATIONRainmaker Entertainment Inc. and its subsidiaries produce and distribute animated films and television programs in Canada. It also provides payroll services for the film and television industry;

and involves in the administration and financing of film and television production tax credits. The company produces computer generated animated feature films. In addition, it offers feature

length DVDs, game cinematics, and television shows based on international brands, including Casper, Popeye, Tony Hawk, Stuart Little, Hot Wheels, Spider-Man, and Inspector Gadget. The company,

formerly known as Rainmaker Income Fund, was founded in 1993 and is headquartered in Vancouver, Canada.


Website http://www.rainmaker.com Latest Fiscal Quarter 3/31/2009





52 Week High (9/10/08) 2.67 Beta 1.15

52 Week Low (2/24/09) 0.42 Float % NA









TSX:RNK YTD 66.7%

S&P 500 YTD 4.3%998 999 1000 2000








Trust Preferred 0.0 Undrawn Revolver 9.3 Margin (%) 11.2% 8.2% 9.2% 5.6% NA NACapital Leases 7.2 Undrawn Commercial Paper 0.0 EBIT (2.5) (3.8) (1.7) (2.8) NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) (12.5%) (11.4%) (4.5%) (8.7%) NA NATotal Principal Due 14.2 Other Available Credit 0.0 Net Income (2.8) (14.6) 7.5 (2.5) NA NA

Total Undrawn Credit 9.3 Margin (%) (14.3%) (43.7%) 19.9% (7.5%) NA NA

998 999 1000 2000 Diluted EPS (0.26) (0.61) (0.00) (0.14) NA NA

VALUATION MULTIPLES


12/31/2006 12/31/2007 12/31/2008 3/31/2009 2009E 2010E Cash from Operations 14.3 6.7 (2.8) 10.1

TEV / Revenue 1.5x 1.0x 0.8x 0.6x NA NA Cash from Investing (2.0) (1.3) 22.0 9.0


TEV / EBIT 23.3x NM NM NM NA NA Change in Cash (4.5) (9.6) 6.2 25.5




Total Revenue (%) (30.8%) 71.1% 12.6% (8.3%) NA NA Total Liabilities 43.0 58.7 24.8 23.1

EBITDA (67.5%) 25.4% 26.6% (63.1%) NA NA Total Equity 20.4 3.0 10.5 7.8






Franklin, Warren Mcelvaine Investment Management Ltd. 5.5 31.47%

Pike, Bryant

Winder, Catherine

Wilder, Kim


McElvaine, Tim

Franklin, Warren

Stacey, Jeffrey Total Shares Outstanding 17.5 100.00%

Selman, Donald

Arnold, Stephen

Radley, Gordon

Director, Chairman of Corporate Governance & Nominating Committee, Member of

Audit Committee and Member of Compensation Committee


Director and Member of Corporate Governance & Nominating Committee


President

Senior Vice President of Production and Operations

Chairman of the Board, Chairman of Compensation Committee and Member of

Corporate Governance & Nominating Committee


Income Statement

Cash Flow Statement


Chief Financial Officer and Secretary

YOY Growth

-67%

25% 27%

0% 0%

(80.0%)

(60.0%)

(40.0%)

(20.0%)

0.0%

20.0%

40.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$1

$1

$2

$2

$3

$3

$4

$4

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

EBITDA TEV / EBITDA

Rainmaker Entertainment Inc. (TSX:RNK) Price & Vol Chart

0.000.501.001.502.002.503.003.504.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/21/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/4/2008

1/13/2009

2/27/2009

4/3/2009

5/19/2009

($)

-

200

400

600

800

1,000

(000)


R A I N M A K E R E N T E R T A I N M E N T I N C . T S X : R N K

109

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


SOMERSET ENTERTAINMENT INCOME FUND (TSX:SOM.UN)

COMPANY INFORMATIONSomerset Entertainment Income Fund operates as an open-ended, limited purpose trust. The company engages in the production and distribution of specialty music and video products primarily in

Canada and the United States. Its product lines represent various music genres, including world, jazz, classical, children’s, and hit compilations, as well as instrumental, vocal and original artist

recordings, and relaxation and nature music. The company sells its products through non-traditional retailers using interactive displays. Its distribution network includes mass merchants,

specialty chains, and independent gift stores. The company was founded in 1994 and is headquartered in Toronto, Canada.


Website http://www.somersetent.com Latest Fiscal Quarter 3/31/2009





52 Week High (7/15/08) 3.80 Beta 0.87

52 Week Low (2/25/09) 0.91 Float % 45.9%









TSX:SOM.UN YTD (9.0%)

S&P 500 YTD 4.3%998 999 1000 2000









Other 0.0 Undrawn Term Loans 0.0 Margin (%) 6.3% 11.7% 8.7% 10.0% NA NATotal Principal Due 11.2 Other Available Credit 0.0 Net Income (94.4) 11.9 (13.4) (15.6) NA NA

Total Undrawn Credit 7.0 Margin (%) (95.7%) 12.4% (15.7%) (18.3%) NA NA

998 999 1000 2000 Diluted EPS (5.30) 0.67 (0.75) (0.87) NA NA

VALUATION MULTIPLES






P / E 0.0x 0.0x 2.2x NM NA NA



Total Revenue (%) 16.6% (2.4%) (11.2%) (8.2%) NA NA Total Liabilities 44.6 38.8 40.6 34.7

EBITDA (15.1%) 9.7% (21.3%) (15.1%) NA NA Total Equity 48.0 47.5 22.0 21.1


EPS 0.0% NM NM NM NA NA




Burgess, Andy Clarke Inc. 4.1 22.91%


Gibson, Gordon Howson Tattersall Investment Counsel 0.6 3.62%

Fiera Capital Inc. 0.3 1.54%

Meier, Robert Cibc Asset Management Inc. 0.1 0.48%

White, Kevin


Ardell, William

Burgess, Andy Burgess, Andy 1.7 9.79%

Gibson, Gordon Total Shares Outstanding 17.8 100.00%

Martin, W.

Casgrain, Timothy

Harrison, Keith

Co-Founder, Chief Creative Officer and Trustee

Trustee, Chairman of Compensation, Nominating & Corporate Governance

Committee, Member of Special Committee and Member of Audit Committee

Trustee, Chairman of Audit Committee, Member of Special Committee and Member

of Compensation, Nominating & Corporate Governance Committee

Trustee


President of Somerset U S

Chairman, Chairman of Special Committee, Member of Compensation, Nominating &

Corporate Governance Committee and Member of Audit Committee

Co-founder, Chief Executive Officer, President and Trustee

Income Statement

Cash Flow Statement

Co-founder, Chief Executive Officer, President and Trustee

Co-Founder, Chief Creative Officer and Trustee

YOY Growth

-15%

10%

-21%

0% 0%

(25.0%)

(20.0%)

(15.0%)

(10.0%)

(5.0%)

0.0%

5.0%

10.0%

15.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$5

$10

$15

$20

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

EBITDA TEV / EBITDA

Somerset Entertainment Income Fund (TSX:SOM.UN) Price & Vol Chart

0.000.501.001.502.002.503.003.504.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

500

1,000

1,500

2,000

2,500

(000)


S O M E R S E T E N T E R T A I N M E N T I N C O M E F U N D T S X : S O M . U N

110

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


UOMO MEDIA, INC (OTCBB:UOMO)

COMPANY INFORMATIONUOMO Media, Inc., through its subsidiaries, provides music publishing, digital music and video, recorded music and production, and talent management services. The company operates through four

divisions: Music Publishing, Recorded Music, Digital Distribution, and Talent Management. The Music Publishing division provides services, such as fund advances, which include providing advances to

individual composers; administration services, which includes registration, tracking, and collection of royalties of copyrights; creative services, which include creating copyrights by writing

songs; and licensing services, which include finding opportunities to monetize copyrights by placing songs on recording artists, film, television, video games, and commercials. The Recorded Music

division provides services, such as catalogue acquisition, talent acquisition for production activities, and distribution arrangements for projects. The Digital Distribution division engages in

the development of digital music and video Web 2.0 software. The Talent Management division offers talent management services. UOMO Media, Inc., formerly known as First Source Data, Inc., was

founded in 2004 and is based in Toronto, Canada.

Stock Exchange OTCBB Latest Fiscal Year 4/30/2008 Primary Industry Movies and Entertainment

Website http://www.uomolife.com Latest Fiscal Quarter 1/31/2009





52 Week High (5/19/09) 1.06 Beta 2.80

52 Week Low (12/30/08) 0.05 Float % 28.6%









OTCBB:UOMO YTD 266.7%

S&P 500 YTD 4.3%998 999 1000 2000








Trust Preferred 0.0 Undrawn Revolver 0.0 Margin (%) (2.5%) NA NA (78.2%) NA NACapital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT (0.0) (0.0) (0.2) (0.5) NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) (4.0%) NA NA (78.7%) NA NATotal Principal Due 0.2 Other Available Credit 0.0 Net Income (0.0) (0.1) (0.3) (0.5) NA NA

Total Undrawn Credit 0.0 Margin (%) (0.8%) NA NA (78.7%) NA NA

998 999 1000 2000 Diluted EPS (0.00) (0.00) (0.00) (0.01) NA NA

VALUATION MULTIPLES


4/30/2006 4/30/2007 4/30/2008 1/31/2009 2009E 2010E Cash from Operations 0.1 (0.1) (0.2) 0.1

TEV / Revenue 0.0x 140.9x NM 30.2x NA NA Cash from Investing (0.0) (0.0) 0.0 (0.4)

TEV / EBITDA 0.0x NM NM NM NA NA Cash from Finaning 0.0 0.1 0.1 0.3

TEV / EBIT 0.0x NM NM NM NA NA Change in Cash 0.1 (0.0) (0.1) 0.0


P / BV 0.0x NM NM NM NA NA Balance Sheet Latest



EBITDA NM NM NM NM NA NA Total Equity 0.1 (0.0) (0.3) (0.6)






Alford, Camara

Thiessen, Jueane

Coquillard, Peter


Alford, Camara

Thiessen, Jueane Mcclelland, Douglas 61.0 71.11%

Diaz, J. Total Shares Outstanding 85.7 100.00%Director

Managing Director of Publishing Division

Chairman, Chief Executive Officer and President

Chief Financial Officer, Principal Accounting Officer, Corporate Compliance Officer,

Secretary and Director

Income Statement

Cash Flow Statement


Chief Financial Officer, Principal Accounting Officer, Corporate Compliance Officer,

Secretary and Director

YOY Growth

0% 0% 0% 0% 0%0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

4/30/2006 4/30/2007 4/30/2008 2009E 2010E

EBITDA

Valuation

($0)

($0)

($0)

($0)

($0)

$0

4/30/2006 4/30/2007 4/30/2008 2009E 2010E

(in

$ m

illions)

0.0x

0.2x

0.4x

0.6x

0.8x

1.0x

EBITDA TEV / EBITDA

UOMO Media, Inc (OTCBB:UOMO) Price & Vol Chart

0.00

0.20

0.40

0.60

0.80

1.00

0 0 0 0 0

3/26/2007

5/11/2007

6/22/2007

8/2/2007

9/5/2007

10/12/2007

12/4/2007

1/14/2008

2/22/2008

4/3/2008

5/9/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/15/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

5,000

10,000

15,000

20,000

25,000

(000)


U O M O M E D I A , I N C . O T C B B : U O M O

111

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


BLUERUSH MEDIA GROUP CORP. (TSXV:BTV)

COMPANY INFORMATION

BlueRush Media Group Corp., through its subsidiary, BlueRush Digital Media Corp., a digital marketing company, engages in programming, producing, and marketing digital video solutions. It creates

digital video solutions for distribution across various media channels, including Internet, Web television, iPods, mobile phones, digital signs, and instore kiosks. The company was incorporated

in 2006 and is headquartered in Toronto, Canada.

Stock Exchange TSXV Latest Fiscal Year 7/31/2008 Primary Industry Advertising

Website http://www.bluerush.ca Latest Fiscal Quarter 1/31/2009







52 Week Low (12/24/08) 0.02 Float % 67.5%









TSXV:BTV YTD 150.0%

S&P 500 YTD 4.3%998 999 1000 2000







Sub Bonds and Notes 0.0 EBITDA 0.0 (0.0) 0.3 0.2 NA NA

Trust Preferred 0.0 Undrawn Revolver 0.0 Margin (%) NA (1.6%) 12.7% 7.4% NA NA

Capital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT 0.0 (0.0) 0.3 0.2 NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) NA (2.5%) 12.1% 6.7% NA NA

Total Principal Due 0.0 Other Available Credit 0.0 Net Income 0.0 (0.0) 0.2 0.1 NA NA

Total Undrawn Credit 0.0 Margin (%) NA (2.5%) 8.4% 3.4% NA NA

998 999 1000 2000 Diluted EPS 0.00 (0.00) 0.01 0.00 NA NA

VALUATION MULTIPLES


1/0/00 7/31/2007 7/31/2008 1/31/2009 2009E 2010E Cash from Operations 0.0 (0.0) (0.0) 0.1

TEV / Revenue 0.0x 0.0x 5.6x 0.3x NA NA Cash from Investing 0.0 (0.0) (0.1) (0.1)

TEV / EBITDA 0.0x 0.0x NM 4.5x NA NA Cash from Finaning 0.0 0.8 (0.0) 0.0

TEV / EBIT 0.0x 0.0x NM 5.0x NA NA Change in Cash 0.0 0.7 (0.1) 0.1

P / E 0.0x 0.0x NM 15.3x NA NA




EBITDA 0.0% 0.0% NM 0.0% NA NA Total Equity 0.0 0.7 1.0 1.0

Net Income 0.0% 0.0% NM 0.0% NA NA

EPS 0.0% 0.0% NM 0.0% NA NA




Lubin, Laurence

Ezer, Daniel

Smofsky, Len

Bunga, Mike


Lubin, Laurence

Ezer, Daniel Smofsky, Len 8.5 26.33%

Smofsky, Len Total Shares Outstanding 32.3 100.00%

Ezer, Haron

Moriarty, Jim

Income Statement

Cash Flow Statement

Founder, Chief Executive Officer, President, Director and Member of Audit Committee

Chief Financial Officer and Director


Consultant

Founder, Chief Executive Officer, President, Director and Member of Audit Committee

Chief Financial Officer and Director




YOY Growth

0% 0% 0% 0%0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

7/31/2007 7/31/2008 2009E 2010E

EBITDA

Valuation

($0)

$0

$0

$0

$0

$0

$0

$0

$0

7/31/2007 7/31/2008 2009E 2010E

(in

$ m

illio

ns)

0.0x

0.2x

0.4x

0.6x

0.8x

1.0x

EBITDA TEV / EBITDA

BlueRush Media Group Corp. (TSXV:BTV) Price & Vol Chart

0.00

0.05

0.10

0.15

0.20

0.25

0 0 0 0 0 0 0 0 0 0 0 0

1/1

4/2

00

8

2/2

2/2

00

8

4/4

/20

08

5/1

6/2

00

8

6/2

6/2

00

8

8/1

/20

08

9/1

1/2

00

8

10

/23

/20

08

11

/24

/20

08

1/1

4/2

00

9

2/4

/20

09

4/3

/20

09

5/1

1/2

00

9

($)

-20406080100120140

(00

0)


B L U E R U S H M E D I A G R O U P C O R P. T S X V : B T V

112

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

ADVERTISING


COSSETTE COMMUNICATION GROUP INC. (TSX:KOS)

COMPANY INFORMATIONCossette Communication Group, Inc., together with its subsidiaries, offers a range of communications services in Canada, the United States, and the United Kingdom. Its services include strategic

planning and research, advertising, media buying and channel planning, sales promotion, direct response, database and direct marketing, customer relationship management, interactive marketing and

technology solutions, public relations, alliance marketing, event marketing, mission marketing, social marketing, branding and design, ethnic marketing, business-to-business communications, and

print and video production. The company was founded in 1972 and is based in Quebec City, Canada with additional offices in Montreal, Toronto, Vancouver, Halifax, New York, Irvine, Los Angeles,

London, Moscow, and Shanghai.

Stock Exchange TSX Latest Fiscal Year 9/30/2008 Primary Industry Advertising

Website http://www.cossette.com Latest Fiscal Quarter 3/31/2009





52 Week High (6/26/08) 6.80 Beta 0.55

52 Week Low (5/20/09) 2.78 Float % 58.2%









TSX:KOS YTD (28.9%)

S&P 500 YTD 4.3%998 999 1000 2000











998 999 1000 2000 Diluted EPS 0.72 0.93 0.54 0.35 0.36 0.39

VALUATION MULTIPLES






P / E 11.6x 13.9x 9.1x 8.1x 7.8x 7.2x




EBITDA 15.4% 20.2% 4.0% 2.4% (40.6%) 13.4% Total Equity 126.5 132.1 134.2 137.3

Net Income 3.5% 26.9% (43.5%) (56.2%) (36.2%) 8.3%

EPS 6.8% 29.4% (42.2%) (54.9%) (33.2%) 8.3%




Lessard, Claude Qv Investors Inc 1.0 6.12%

Beutel Goodman & Company Ltd. 0.5 3.00%

Faucher, Martin Ig Investment Management, Ltd. 0.4 2.37%

Montrusco Bolton Investments Inc. 0.0 0.25%

Delagrave, Pierre Cinnamon Investments Limited 0.0 0.16%

Schleining, Colin


Lessard, Claude

Paine, David Lessard, Claude 2.3 14.54%

Band, Nick Total Shares Outstanding 15.8 100.00%

Miles, Jeremy

Delagrave, Pierre

Houde, Monic

Chairman of Band & Brown Group

Chairman of Miles Calcraft Briginshaw Duffy

Director, President of Cossette Media and President of Fjord Marketing Interactive &

Technology

Director and Chairman of Human Resources & Corporate Governance Committee

Director, President of Cossette Media and President of Fjord Marketing Interactive &

Technology

Chief Operating Officer of Cossette U.S and Executive Vice President of Cossette West


Chairman of PainePR

Income Statement

Cash Flow Statement



YOY Growth

15%20%

4%

-41%

13%

(50.0%)

(40.0%)

(30.0%)

(20.0%)

(10.0%)

0.0%

10.0%

20.0%

30.0%

9/30/2006 9/30/2007 9/30/2008 2009E 2010E

EBITDA

Valuation

$0

$5

$10

$15

$20

$25

$30

$35

$40

9/30/2006 9/30/2007 9/30/2008 2009E 2010E

(in

$ m

illions)

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

7.0x

EBITDA TEV / EBITDA

Cossette Communication Group Inc. (TSX:KOS) Price & Vol Chart

0.002.004.006.008.0010.0012.0014.0016.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-100200300400500600700

(000)


C O S S E T T E C O M M U N I C A T I O N G R O U P I N C . T S X : K O S

113

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


EMPIRICAL INC. (TSXV:EM)

COMPANY INFORMATION

Empirical, Inc. operates as an outsourced marketing services company in Canada and the United States. It provides sales, marketing, and advertising agency services to various industries. The

company offers various marketing services, such as strategic consulting and creative development, branding and design, advertising, sales promotions, and sales conference planning, as well as event,

direct, and social marketing. Empirical also provides sales and marketing channel support services comprising online e-learning/training solutions; online transactional loyalty and online retail

loyalty programs, such as design, development, and integration; online database middleware integration; desktop communication tool, online campaign, and sales/lead management; fulfillment and

distribution of promotional materials and point-of-sales collateral to national dealer and distributor organizations on behalf of OEMs and retailers; business outsourcing, including fulfillment of

daily shipments and returns of consumer orders; warehousing and inventory management of client materials; and customer care services. In addition, it offers various promotional solutions,

including online contest sweepstakes; SMS sweepstakes and random draw contest development and administration; online instant win contests, as well as pin-based, and scratch and win contests; online and

offline survey, development, and administration; offline contests, and incentive programs development and administration; and email/fax/SMS development, deployment, and administration. The

company, formerly known as True North Corporation, is headquartered in Toronto, Canada.

Stock Exchange TSXV Latest Fiscal Year 12/31/2007 Primary Industry Advertising

Website http://www.empirical.com Latest Fiscal Quarter 9/30/2008






52 Week High (5/13/08) 0.00 Beta 1.09

52 Week Low (9/25/08) 0.00 Float % NA









TSXV:EM YTD (100.0%)

S&P 500 YTD 4.3%998 999 1000 2000








Trust Preferred 0.0 Undrawn Revolver 1.0 Margin (%) (1.2%) (19.0%) (17.4%) (21.8%) NA NA

Capital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT (0.4) (2.5) (3.8) (4.6) NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) (2.8%) (23.4%) (37.7%) (43.6%) NA NA

Total Principal Due 7.7 Other Available Credit 0.0 Net Income (1.0) (5.9) (5.9) (5.8) NA NA


998 999 1000 2000 Diluted EPS (0.05) (0.23) (0.12) (0.10) NA NA

VALUATION MULTIPLES


12/31/2005 12/31/2006 12/31/2007 9/30/2008 2008E 2009E Cash from Operations 0.5 (0.9) (2.7) (3.4)

TEV / Revenue 0.5x 0.6x 0.8x 0.0x NA NA Cash from Investing (0.6) 0.3 0.3 0.0

TEV / EBITDA 11.0x NM NM 0.0x NA NA Cash from Finaning (0.1) 0.5 2.7 3.5

TEV / EBIT 18.5x NM NM 0.0x NA NA Change in Cash (0.2) (0.0) 0.4 0.2

P / E NM NM NM 0.0x NA NA

P / BV NM NM NM 0.0x NA NA Balance Sheet Latest


Total Revenue (%) 23.7% (26.6%) (6.1%) 3.0% NA NA Total Liabilities 7.4 9.7 11.2 16.5

EBITDA NM NM NM NM NA NA Total Equity (0.8) (2.2) (6.9) (9.0)






Anthony, Mark

Garland, David

McKinnon, Ian

Iantorno, Salvatore


Cochrane, Don

Total Shares Outstanding 74.4 100.00%

Income Statement

Cash Flow Statement

President

Chief Financial Officer and Office of the President

Chief Executive Officer

Secretary and Treasurer

Vice President of Marketing

YOY Growth

0% 0% 0% 0% 0%0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

12/31/2005 12/31/2006 12/31/2007 2008E 2009E

EBITDA

Valuation

($3)

($2)

($2)

($1)

($1)

$0

12/31/2005 12/31/2006 12/31/2007 2008E 2009E

(in

$ m

illio

ns)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

EBITDA TEV / EBITDA

Empirical Inc. (TSXV:EM) Price & Vol Chart

0.00

0.05

0.10

0.15

0.20

0.25

9/8

/20

06

10

/20

/20

06

11

/30

/20

06

1/1

0/2

00

7

2/2

0/2

00

7

3/3

0/2

00

7

5/1

1/2

00

7

6/2

1/2

00

7

8/2

/20

07

9/1

1/2

00

7

10

/24

/20

07

11

/29

/20

07

1/1

4/2

00

8

2/2

2/2

00

8

4/4

/20

08

5/1

6/2

00

8

6/2

6/2

00

8

8/6

/20

08

9/1

5/2

00

8

10

/27

/20

08

12

/3/2

00

8

1/1

5/2

00

9

1/1

5/2

00

9

1/1

5/2

00

9 0

($)

-

1,000

2,000

3,000

4,000

5,000

6,000

(00

0)


E M P I R I C A L I N C . T S X V : E M

114

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


ENVOY CAPITAL GROUP, INC. (TSX:ECG)

COMPANY INFORMATIONEnvoy Capital Group, Inc, through its subsidiary, Watt International, Inc., operates as a consumer and retail branding company. It offers consulting, branding, packaging, and retail design

services to clients in Canada, the United States, Mexico, the United Arab Emirates, China, and South America, as well as project work for clients in other countries. The company also provides merchant

banking and financial services, as well as equity and debt capital to small and mid-cap companies. It provides loans and equity investments to publicly listed and private companies in various

industries, including media and marketing services, manufacturing, and real estate. The company, formerly known as Potential Mines, Ltd., was founded in 1973 and is based in Toronto, Canada.


Website http://www.envoy.to Latest Fiscal Quarter 3/31/2009





52 Week High (6/16/08) 2.97 Beta 0.34

52 Week Low (10/24/08) 1.10 Float % 72.6%







Enterprise Value (7.0) Last 6 Months 0.0


TSX:ECG YTD (3.6%)

S&P 500 YTD 4.3%998 999 1000 2000







Sub Bonds and Notes 0.0 EBITDA (5.1) 3.1 (5.7) (7.4) NA NA

Trust Preferred 0.0 Undrawn Revolver 2.0 Margin (%) (52.3%) 17.4% (50.6%) (74.0%) NA NACapital Leases 0.0 Undrawn Commercial Paper 0.0 EBIT (5.9) 2.3 (6.4) (8.1) NA NA

Other 0.0 Undrawn Term Loans 0.0 Margin (%) (60.6%) 13.1% (57.2%) (81.3%) NA NATotal Principal Due 0.1 Other Available Credit 0.0 Net Income 2.1 3.0 (10.2) (11.8) NA NA

Total Undrawn Credit 2.0 Margin (%) 22.1% 17.2% (90.2%) (118.8%) NA NA

998 999 1000 2000 Diluted EPS (0.26) 0.20 (1.11) (1.36) NA NA

VALUATION MULTIPLES


9/30/2006 9/30/2007 9/30/2008 3/31/2009 2009E 2010E Cash from Operations 7.5 1.6 2.0 (2.9)

TEV / Revenue 1.2x 0.1x NM NM NA NA Cash from Investing (3.0) 29.4 3.3 3.5

TEV / EBITDA 93.3x 0.9x NM NM NA NA Cash from Finaning (7.5) (31.1) (5.0) (2.6)

TEV / EBIT NM 1.4x NM NM NA NA Change in Cash (1.6) 0.0 0.5 (1.7)




Total Revenue (%) (50.6%) 81.5% (35.8%) (40.5%) NA NA Total Liabilities 6.2 5.6 4.3 5.7


Net Income (64.0%) 41.2% NM NM NA NA





Leeder, James Renaissance Technologies Corp. 0.4 4.10%

Perritt Capital Management, Inc. 0.2 2.19%

Rodmell, Patrick Riversource Investments, Llc 0.0 0.00%

Beaton, Colin

Patient, Andrew


Hull, David

Parkes, David Genovese, Geoffrey 1.3 15.67%

Genovese, Geoffrey Total Shares Outstanding 8.6 100.00%

Bailey, John

Aird, Hugh

Director

Director

Lead Director, Member of Audit Committee, Member of Compensation Committee

and Member of Nominating & Corporate Governance Committee

Managing Director of Retail Design Business - Watt International


Chairman of the Board, Chairman of Nominating & Corporate Governance Committee,

Chairman of Compensation Committee and Member of Audit Committee

Independent Director, Chairman of Audit Committee, Member of Compensation

Committee and Member of Nominating & Corporate Governance Committee

Income Statement

Cash Flow Statement


Managing Director of Watt International Inc

YOY Growth

0% 0% 0% 0% 0%0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

9/30/2006 9/30/2007 9/30/2008 2009E 2010E

EBITDA

Valuation

($8)

($6)

($4)

($2)

$0

$2

$4

9/30/2006 9/30/2007 9/30/2008 2009E 2010E

(in

$ m

illions)

0.0x

20.0x

40.0x

60.0x

80.0x

100.0x

EBITDA TEV / EBITDA

Envoy Capital Group, Inc. (TSX:ECG) Price & Vol Chart

0.00

1.00

2.00

3.00

4.00

5.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/10/2007

6/22/2007

8/1/2007

9/13/2007

10/24/2007

11/28/2007

1/14/2008

2/22/2008

4/3/2008

5/16/2008

6/26/2008

8/6/2008

9/10/2008

10/27/2008

12/5/2008

1/16/2009

2/26/2009

4/8/2009

5/15/2009

($)

-

50

100

150

200

250

(000)


E N V O Y C A P I T A L G R O U P, I N C . T S X : E C G

115

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


MDC PARTNERS INC. (NASDAQGS:MDCA)

COMPANY INFORMATIONMDC Partners, Inc., through its subsidiaries, provides marketing communications services primarily in the United States, Canada, Europe, Jamaica, and Philippines. It operates through three

segments: Strategic Marketing Services, Customer Relationship Management, and Specialized Communication Services. The Strategic Marketing Services segment offers a suite of integrated marketing

communication and consulting services, including advertising and media, interactive marketing, direct marketing, public relations, corporate communications, market research, corporate identity and

branding, and sales promotion services. The Customer Relationship Management segment provides marketing services that interface directly with the consumer of a client’s product or service. These

services include the design, development, and implementation of customer service and direct marketing initiative intended to acquire, retain, and develop each client’s customer base. The Specialized

Communication Services segment offers advertising, interactive marketing, sales promotion, direct marketing, media relations, design and branding, research, and corporate communications services.

MDC Partners also offers advertising, retail and event marketing, and consumer promotion services. The company was formerly known as MDC Corporation, Inc. and changed its name to MDC Partners,

Inc. in January 2004. MDC Partners, Inc. was founded in 1980 and is headquartered in Toronto, Canada.

Stock Exchange NasdaqGS Latest Fiscal Year 12/31/2008 Primary Industry Advertising

Website http://www.mdccorp.com Latest Fiscal Quarter 3/31/2009





52 Week High (6/09/08) 8.79 Beta 1.23

52 Week Low (11/21/08) 2.19 Float % 84.1%









NASDAQGS:MDCA YTD 87.8%

S&P 500 YTD 4.3%998 999 1000 2000









Other 0.0 Undrawn Term Loans 0.0 Margin (%) 5.8% 4.4% 3.5% 3.7% NA NATotal Principal Due 181.5 Other Available Credit 0.0 Net Income (33.5) (26.4) 0.1 3.6 3.6 5.4

Total Undrawn Credit 40.6 Margin (%) (8.3%) (4.9%) 0.0% 0.6% 0.6% 0.9%

998 999 1000 2000 Diluted EPS (0.35) (0.73) 0.37 0.39 0.13 0.19

VALUATION MULTIPLES





TEV / EBIT 19.4x 23.4x 10.0x 16.7x NA NA Change in Cash (6.3) 3.8 30.9 40.5

P / E NM NM NM 14.6x 43.9x 29.6x




EBITDA 5.6% 10.3% 4.6% (3.4%) 18.2% 12.2% Total Equity 124.4 127.9 127.2 89.6


EPS NM NM NM NM (64.9%) 48.5%




Nadal, Miles Robeco Boston Partners 3.1 11.14%

Goldman Capital Management, Inc. 2.1 7.51%

Doft, David Cardinal Capital Management, L.L.C. 2.0 7.03%

Porter Orlin, Llc 1.7 6.20%

Dickson, Robert William Blair Investment Management 1.6 5.59%

The Clark Estates, Inc. 1.4 4.84%

Rosenberg, Graham Gruber & Mcbaine Capital Management, Llc 1.2 4.21%

Wall Street Associates 1.1 3.77%

Selected Board Members Title Harbert Management Corporation 0.8 2.88%

Nadal, Miles Royce & Associates, Llc 0.7 2.41%

Pustil, Stephen Nadal, Miles 3.1 11.08%

Kamerschen, Robert Total Shares Outstanding 28.1 100.00%

Kirby, Michael

Copeland, Clare

Davidson, Thomas

Presiding Director, Chairman of Nominating & Corporate Governance Committee and

Member of Human Resources & Compensation Committee

Director, Chairman of Oversight Committee, Chairman of Human Resources &

Compensation Committee, Member of Nominating & Corporate Governance

Director, Chairman of Audit Committee and Member of Human Resources &

Compensation Committee

Director, Member of Audit Committee and Member of Nominating & Corporate


Managing Director

Managing Director

Founder, Executive Chairman, Chief Executive Officer and President

Vice Chairman

Income Statement

Cash Flow Statement

Founder, Executive Chairman, Chief Executive Officer and President


YOY Growth

6%

10%

5%

18%

12%

0.0%

5.0%

10.0%

15.0%

20.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$10

$20

$30

$40

$50

$60

$70

$80

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

EBITDA TEV / EBITDA

MDC Partners Inc. (NASDAQGS:MDCA) Price & Vol Chart

0.00

2.00

4.00

6.00

8.00

10.00

12.00

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/22/2007

8/3/2007

9/13/2007

10/24/2007

12/4/2007

1/14/2008

2/22/2008

4/4/2008

5/16/2008

6/26/2008

8/6/2008

9/16/2008

10/27/2008

12/5/2008

1/16/2009

2/27/2009

4/9/2009

5/20/2009

($)

-

200

400

600

800

1,000

1,200

(000)


M D C P A R T N E R S I N C . N A S D A Q G S : M D C A

116

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


PARETO CORP. (TSX:PTO)

COMPANY INFORMATIONPareto Corporation operates as a marketing services and execution company in Canada. The company engages in the design, production, and fulfillment of in-store marketing materials; and provision

of field merchandising, direct marketing, incentive programs, event management, incentives and loyalty management, and merchandising and retail services. It also provides outsourced marketing

program management and field merchandising services. The company is based in Toronto, Canada.


Website http://www.pareto.ca Latest Fiscal Quarter 3/31/2009





52 Week High (6/23/08) 1.00 Beta 0.94

52 Week Low (12/09/08) 0.40 Float % 76.5%









TSX:PTO YTD 46.7%

S&P 500 YTD 4.3%998 999 1000 2000











998 999 1000 2000 Diluted EPS 0.04 0.07 0.08 0.08 0.10 0.12

VALUATION MULTIPLES


12/31/2006 12/31/2007 12/31/2008 3/31/2009 2009E 2010E Cash from Operations (1.1) 0.6 7.2 7.5



TEV / EBIT 11.7x 17.9x 4.2x 5.0x NA NA Change in Cash (0.1) (5.4) (0.3) 2.5

P / E 18.4x 23.9x 6.0x 7.9x 6.6x 5.5x




EBITDA (57.9%) 172.0% 11.4% 10.9% 26.2% 12.6% Total Equity 23.7 25.7 27.4 27.5

Net Income (47.9%) 102.0% 13.7% 16.0% 20.6% 20.0%

EPS (54.1%) 94.1% 16.7% 18.9% 25.8% 20.0%




Shapansky, Kerry

Trudell, Karen

Warner, Brian

Naylor, Kim


Ward, J.R.

Shapansky, Kerry Shapansky, Kerry 5.4 12.53%

Stevens, John Total Shares Outstanding 42.9 100.00%

Atkins, David

Cochrane, Gregory

Director, Chairman of Corporate Development Committee, Chairman of Corporate

Governance Committee and Member of Audit Committee



Director, Member of Compensation Committee and Member of Corporate



Executive Vice President of Client Strategy

Chairman, Chairman of Compensation Committee and Member of Audit Committee

Chief Executive Officer, President, Director and Member of Corporate Development

Committee

Income Statement

Cash Flow Statement

Chief Executive Officer, President, Director and Member of Corporate Development

Committee


YOY Growth

-58%

172%

11%26% 13%

(100.0%)

(50.0%)

0.0%

50.0%

100.0%

150.0%

200.0%

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

EBITDA

Valuation

$0

$2

$4

$6

$8

$10

$12

12/31/2006 12/31/2007 12/31/2008 2009E 2010E

(in

$ m

illions)

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

EBITDA TEV / EBITDA

Pareto Corp. (TSX:PTO) Price & Vol Chart

0.000.200.400.600.801.001.201.401.60

9/8/2006

10/20/2006

11/30/2006

1/10/2007

2/20/2007

4/2/2007

5/11/2007

6/21/2007

8/3/2007

9/13/2007

10/23/2007

12/4/2007

1/14/2008

2/22/2008

4/2/2008

5/16/2008

6/26/2008

8/6/2008

9/11/2008

10/27/2008

12/4/2008

1/8/2009

2/26/2009

3/31/2009

5/20/2009

($)

-100200300400500600700800900

(000)


P A R E T O C O R P. T S X : P T O

117

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

Trading Multiples

Company Name

CAD

Market

Cap

($m)

CAD

Enterprise

Value ($m)

Dividend

Yield

CFFO

Yield

CFFO

Yield

(EV)

P/

CFFO

EV/

CFFO

FCF

Yield P/FCF

TEV/

LTM

EBITDA

TEV/

NTM

EBITDA

TEV/

EBITDA

CY

TEV/

EBITDA

CY+1

P/ LTM

EPS

P/ NTM

EPS P/E CY

P/E

CY+1









Broadview Press Inc. (TSXV:BDP) 0.4 0.6 NM NM NM NM NM 46.7% 2.1x NM NM NM NM 3.7x NM NM NM

FP Canadian Newspapers Limited Partnership

(TSX:FP.UN) 29.0 138.3 27.1% 33.4% 7.0% 3.0x 14.3x 23.7% 4.2x 6.5x NM 7.6x 7.3x NM NM NM NM

Glacier Media, Inc. (TSX:GVC) 170.0 300.9 NM 20.1% 11.4% 5.0x 8.8x 6.5% 15.3x 6.7x 7.3x 7.4x 6.6x 7.5x 7.3x 7.1x 6.2x

Lingo Media Corporation (TSXV:LM) 13.5 12.2 NM NM NM NM NM NM NM NM NM NM NM NM NM NM NM

McGraw-Hill Ryerson Ltd. (TSX:MHR) 73.9 50.4 2.8% 28.0% 41.1% 3.6x 2.4x 27.4% 3.6x 2.9x NM NM NM 7.2x NM NM NM

MPL Communications Inc. (TSXV:MPZ) 0.4 0.6 NM NM NM NM NM 231.4% 0.4x 2.1x NM NM NM NM NM NM NM

Multimedia Nova Corp. (TSXV:MNC.A) 0.9 10.8 NM NM NM NM NM NM NM 12.8x NM NM NM NM NM NM NM

Quebecor Inc. (TSX:QBR.B) 1,164.1 6,876.3 1.1% 72.3% 12.2% 1.4x 8.2x NM NM 6.1x 6.0x 6.0x 5.8x NM 6.5x 6.6x 6.3x

Thomson Reuters Corporation (TSX:TRI) 28,314.1 35,180.1 3.3% 12.1% 9.7% 8.3x 10.3x NM NM 9.2x 10.1x 9.8x 8.8x 15.6x 17.3x 18.2x 15.2x

Torstar Corporation (TSX:TS.B) 380.7 999.7 7.7% 35.3% 13.5% 2.8x 7.4x 29.5% 3.4x 5.1x 6.1x 5.6x 5.3x NM 6.2x 6.1x 4.9x

Transcontinental Inc. (TSX:TCL.A) 666.4 1,492.5 3.9% 39.5% 17.7% 2.5x 5.7x NM NM 4.4x 4.5x 4.5x 4.2x NM 5.8x 5.8x 5.2x

Yellow Pages Income Fund (TSX:YLO.UN) 2,750.3 5,961.7 14.8% 27.1% 12.5% 3.7x 8.0x 20.1% 5.0x 6.4x 6.5x 6.4x 6.4x 6.2x 5.1x 4.9x 5.0x


BCE, Inc. (TSX:BCE) 19,073.0 32,881.0 6.2% 31.0% 18.0% 3.2x 5.6x 14.1% 7.1x 4.8x 4.7x 4.7x 4.7x 19.4x 10.3x 10.4x 10.4x

Canadian Satellite Radio Holdings Inc (TSX:XSR) 27.2 161.0 NM NM NM NM NM 15.3% 6.5x NM NM NM NM NM NM NM NM

Cogeco Cable Inc. (TSX:CCA) 1,397.0 2,562.9 1.7% 28.9% 15.7% 3.5x 6.4x 3.3% 30.2x 5.5x 5.1x 5.1x 4.8x NM 13.4x 13.2x 11.2x

Cogeco Inc. (TSX:CGO) 376.7 2,211.5 1.4% 108.6% 18.5% 0.9x 5.4x 13.1% 7.7x 4.7x 4.2x 4.2x 3.9x NM 8.6x 9.0x 7.2x

JumpTV Inc. (TSX:JTV) 88.8 61.4 NM NM NM NM NM 3.8% 26.5x NM NM NM NM NM NM NM NM

Manitoba Telecom Services, Inc. (TSX:MBT) 2,215.9 3,026.5 7.6% 21.5% 15.8% 4.6x 6.3x 9.5% 10.5x 4.8x 4.7x 4.7x 4.6x 17.5x 11.8x 12.0x 11.8x

Rogers Communications Inc. (TSX:RCI.B) 20,534.2 29,276.2 3.6% 16.1% 11.3% 6.2x 8.9x NM NM 7.1x 6.8x 6.8x 6.4x 21.4x 15.8x 16.1x 14.2x

Shaw Communications, Inc. (TSX:SJR.B) 8,048.0 11,033.5 4.5% 16.9% 12.3% 5.9x 8.1x 3.8% 26.5x 8.0x 6.8x 7.0x 6.5x 15.0x 14.2x 14.6x 13.1x

TELUS Corporation (TSX:T) 10,409.7 16,880.7 5.8% 26.9% 16.6% 3.7x 6.0x NM NM 4.4x 4.6x 4.6x 4.5x 9.1x 10.6x 10.0x 10.1x


Cineplex Entertainment Limited Partnership

(TSX:CGX.UN) 887.5 1,233.7 8.1% 15.3% 11.0% 6.5x 9.1x 4.8% 20.7x 8.2x 8.2x 8.1x 7.7x NM 17.7x 18.4x 16.0x

Cinram International Income Fund (TSX:CRW) 95.0 603.1 NM 115.2% 18.2% 0.9x 5.5x 58.5% 1.7x 2.0x 3.5x 3.4x 3.9x NM NM NM NM

DHX Media Ltd. (TSX:DHX) 30.9 90.4 NM NM NM NM NM 98.5% 1.0x 13.9x 6.1x 7.6x 3.7x NM 6.4x 5.9x 4.8x

Entertainment One Ltd. (AIM:ETO) 71.6 129.6 NM 65.4% 36.1% 1.5x 2.8x NM NM 4.0x 3.0x 3.2x 2.5x NM 2.1x 2.1x 1.7x

E-SOL International Corp. (OTCPK:ESIT) 44.4 -44.2 NM NM NM NM NM NM NM NM NM NM NM NM NM NM NM

Fluid Music Canada, Inc. (TSX:FMN) 41.0 27.3 NM NM NM NM NM NM NM NM NM NM NM NM NM NM NM

FRV Media, Inc. (TSXV:FRV) 0.3 3.2 NM NM NM NM NM NM NM NM NM NM NM NM NM NM NM

IMAX Corporation (NasdaqGM:IMAX) 357.1 487.1 NM NM NM NM NM NM NM NM 9.2x 10.6x 6.4x NM NM NM 21.7x

Knightscove Media Corp. (TSXV:KC.A) 0.5 1.8 NM 97.8% 24.5% 1.0x 4.1x NM NM NM NM NM NM NM NM NM NM

Lions Gate Entertainment Corp. (NYSE:LGF) 701.7 829.2 NM 14.8% 12.5% 6.8x 8.0x 71.8% 1.4x NM 47.5x 47.5x 9.8x NM NM NM 14.5x

Peace Arch Entertainment Group Inc. (AMEX:PAE) 4.4 67.3 NM NM NM NM NM 192.8% 0.5x NM 8.3x 12.5x NM NM NM NM NM

Rainmaker Entertainment Inc. (TSX:RNK) 17.5 19.3 NM 57.8% 52.2% 1.7x 1.9x 23.5% 4.3x 10.5x NM NM NM NM NM NM NM

Somerset Entertainment Income Fund (TSX:SOM.UN) 21.7 28.9 16.4% 55.3% 41.5% 1.8x 2.4x 52.5% 1.9x 1.9x NM NM NM NM NM NM NM

UOMO Media, Inc (OTCBB:UOMO) 20.7 19.2 NM 0.7% 0.8% NM NM NM NM NM NM NM NM NM NM NM NM


BlueRush Media Group Corp. (TSXV:BTV) 1.6 1.1 NM 8.9% 13.6% 11.3x 7.4x NM NM 4.5x NM NM NM 15.2x NM NM NM

Cossette Communication Group Inc. (TSX:KOS) 45.0 51.2 NM 119.4% 105.0% 0.8x 1.0x 117.0% 0.9x 1.5x 2.2x 2.3x NM 8.1x 7.6x 7.8x NM

Cyberplex Inc. (TSX:CX) 84.2 79.5 NM 5.4% 5.7% 18.5x 17.4x 2.6% 38.0x 9.5x 6.3x 6.7x 5.2x 8.8x 9.4x 9.6x 8.7x

Empirical Inc. (TSXV:EM) 0.3 12.1 NM NM NM NM NM NM NM NM NM NM NM NM NM NM NM

Envoy Capital Group, Inc. (TSX:ECG) 13.7 -7.0 NM NM NM NM NM NM NM NM NM NM NM NM NM NM NM


Pareto Corp. (TSX:PTO) 28.3 31.0 9.1% 26.4% 24.1% 3.8x 4.1x 22.6% 4.4x 4.3x NM 3.6x 3.2x 7.9x NM 6.6x 5.5x



Low 0.3 -44.2 1.1% 0.7% 0.8% 0.7x 1.0x 0.1% 0.2x 1.5x 2.2x 2.3x 2.5x 3.7x 2.1x 2.1x 1.7x


EBITDA EPS


Figure 87. Valuation Comparison

Source. Capital IQ

.

APPENDIX 1

C O M P T A B L E S C A N A D I A N


118

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


119

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

(In millions of the reported currency except share and per share data)

Company Name LTM as of

LTM Total

Rev

1 Yr.

Revenue

Growth

LTM

EBITDA

As % of

Revenue CFFO

As % of

Revenue

LTM Diluted

EPS

Before Extra

NTM

Total

Rev Est.

NTM

EBITDA

Est.

As % of

Revenue

NTM

Diluted

EPS Est.

Asian Television Network International Ltd. (TSXV:SAT) 3/31/2009 14.7 2.8% 2.3 15.5% 1.5 10.0% 0.02 - - NM -

Astral Media Inc. (TSX:ACM.A) 2/28/2009 915.6 25.6% 304.4 33.3% 200.8 21.9% 2.73 919.5 - 0.0% 2.86

CanWest Global Communications Corp. (TSX:CGS) 2/28/2009 3,101.0 4.0% 538.5 17.4% 56.6 1.8% (14.09) 3,042.8 524.6 17.2% (0.15)

Corus Entertainment Inc. (TSX:CJR.B) 2/28/2009 791.7 1.7% 251.4 31.7% 134.5 17.0% 1.52 801.7 250.1 31.2% 1.53

Newfoundland Capital Corp. Ltd. (TSX:NCC.A) 3/31/2009 98.7 -4.7% 9.2 9.4% 19.4 19.6% (0.40) 106.6 20.9 19.6% 0.66

Score Media Inc. (TSX:SCR) 2/28/2009 37.9 10.7% 4.9 13.0% 6.4 16.9% 0.01 - - NM -

TVA GROUP Inc. (TSX:TVA.B) 3/31/2009 440.1 2.7% 67.1 15.3% 43.5 9.9% 1.87 429.3 61.6 14.3% 1.54

BROADCASTING MEDIAN 440.1 2.8% 67.1 15.5% 43.5 16.9% 0.02 429.3 20.9 17.2% 0.66

Broadview Press Inc. (TSXV:BDP) 3/31/2009 3.2 -26.3% (0.1) -2.7% (0.3) -11.0% 0.01 - - NM -

FP Canadian Newspapers Limited Partnership (TSX:FP.UN) 3/31/2009 118.0 -6.4% 21.1 17.9% 9.7 8.2% - - - NM -

Glacier Media, Inc. (TSX:GVC) 3/31/2009 245.1 10.5% 45.0 18.4% 34.2 13.9% 0.24 233.2 41.4 17.8% 0.25

Lingo Media Corporation (TSXV:LM) 3/31/2009 1.0 383.0% (1.8) -173.1% (2.2) NM (0.21) - - NM -

McGraw-Hill Ryerson Ltd. (TSX:MHR) 3/31/2009 93.9 2.7% 17.4 18.6% 20.7 22.0% 5.16 - - NM -

MPL Communications Inc. (TSXV:MPZ) 12/31/2008 5.8 -12.7% 0.3 4.9% (0.2) -3.7% (0.06) - - NM -

Multimedia Nova Corp. (TSXV:MNC.A) 12/31/2008 15.4 0.7% 0.8 5.5% (0.2) -1.0% (0.24) - - NM -

Quebecor Inc. (TSX:QBR.B) 3/31/2009 3,749.2 7.4% 1,136.5 30.3% 842.1 22.5% (2.85) 3,863.1 1,149.9 29.8% 2.78

Thomson Reuters Corporation (TSX:TRI) 3/31/2009 16,320.3 74.2% 3,803.5 23.3% 3,425.5 21.0% 2.18 14,082.5 3,473.5 24.7% 1.98

Torstar Corporation (TSX:TS.B) 3/31/2009 1,523.8 0.2% 196.6 12.9% 134.6 8.8% (2.54) 1,473.0 163.7 11.1% 0.78

Transcontinental Inc. (TSX:TCL.A) 1/31/2009 2,437.4 3.7% 336.3 13.8% 263.5 10.8% (0.40) 2,500.1 332.6 13.3% 1.42

Yellow Pages Income Fund (TSX:YLO.UN) 3/31/2009 1,690.5 2.2% 936.0 55.4% 744.4 44.0% 0.88 1,691.3 912.4 53.9% 1.05

PUBLISHING MEDIAN 181.5 2.5% 33.1 15.9% 27.4 10.8% (0.03) 116.6 20.7 21.2% 0.13

BCE, Inc. (TSX:BCE) 3/31/2009 17,680.0 -0.3% 6,838.0 38.7% 5,913.0 33.4% 1.28 17,605.4 7,011.8 39.8% 2.42

Canadian Satellite Radio Holdings Inc (TSX:XSR) 2/28/2009 47.4 58.4% (25.3) -53.5% (13.1) -27.6% (1.93) 57.2 (17.1) -29.9% (1.15)

Cogeco Cable Inc. (TSX:CCA) 2/28/2009 1,164.2 16.2% 462.0 39.7% 403.5 34.7% (5.61) 1,230.3 502.0 40.8% 2.15

Cogeco Inc. (TSX:CGO) 2/28/2009 1,197.0 15.9% 467.5 39.1% 409.2 34.2% (5.09) 1,290.7 531.8 41.2% 2.61

JumpTV Inc. (TSX:JTV) 12/31/2008 16.5 72.1% (10.3) -62.6% (6.9) -41.8% (0.26) - - NM -

Manitoba Telecom Services, Inc. (TSX:MBT) 3/31/2009 1,925.6 0.4% 629.2 32.7% 477.5 24.8% 1.96 1,925.7 644.3 33.5% 2.90

Rogers Communications Inc. (TSX:RCI.B) 3/31/2009 11,473.0 10.0% 4,152.0 36.2% 3,301.0 28.8% 1.52 11,941.2 4,317.4 36.2% 2.05

Shaw Communications, Inc. (TSX:SJR.B) 2/28/2009 3,254.5 11.3% 1,379.2 42.4% 1,357.9 41.7% 1.25 3,546.7 1,618.2 45.6% 1.32

TELUS Corporation (TSX:T) 3/31/2009 9,678.0 5.0% 3,816.0 39.4% 2,799.0 28.9% 3.62 9,742.2 3,674.0 37.7% 3.10

TELECOM MEDIAN 1,925.6 11.3% 629.2 38.7% 477.5 28.9% 1.25 1,925.7 644.3 38.8% 2.15

Cineplex Entertainment Limited Partnership (TSX:CGX.UN) 3/31/2009 870.9 6.7% 149.9 17.2% 136.2 15.6% - 889.5 149.9 16.9% 0.88

Cinram International Income Fund (TSX:CRW) 3/31/2009 2,297.3 1.3% 302.8 13.2% 109.5 4.8% (1.32) 1,567.8 172.8 11.0% -

DHX Media Ltd. (TSX:DHX) 3/31/2009 64.1 29.5% 6.5 10.1% (14.7) -23.0% (0.02) 82.3 14.9 18.2% 0.11

Entertainment One Ltd. (AIM:ETO) 3/31/2008 430.7 0.0% 32.2 7.5% 46.8 10.9% (0.15) 606.2 43.6 7.2% 0.14

E-SOL International Corp. (OTCPK:ESIT) 3/31/2009 0.0 829.8% (3.0) NM - 0.0% (0.06) - - NM -

Fluid Music Canada, Inc. (TSX:FMN) 3/31/2009 6.3 158.3% (8.6) -138.1% (10.9) -174.7% (0.46) 6.0 (7.3) -121.8% (0.20)

FRV Media, Inc. (TSXV:FRV) 10/31/2007 4.6 0.0% (2.5) -53.9% (6.1) -131.6% (0.08) - - NM -

IMAX Corporation (NasdaqGM:IMAX) 3/31/2009 139.8 5.5% (5.8) -4.2% (14.6) -10.4% (0.76) 157.4 53.1 33.7% 0.03

Knightscove Media Corp. (TSXV:KC.A) 2/28/2009 3.6 0.0% (0.5) -13.9% 0.4 12.3% (0.02) - - NM -

Lions Gate Entertainment Corp. (NYSE:LGF) 12/31/2008 1,859.1 28.3% (95.6) -5.1% 103.7 5.6% (1.09) 1,696.8 17.5 1.0% (0.21)

Peace Arch Entertainment Group Inc. (AMEX:PAE) 5/31/2008 72.9 25.3% (3.0) -4.1% (18.8) -25.7% (0.35) - 8.1 NM -

Rainmaker Entertainment Inc. (TSX:RNK) 3/31/2009 32.8 -8.3% 1.8 5.6% 10.1 30.8% (0.14) - - NM -

Somerset Entertainment Income Fund (TSX:SOM.UN) 3/31/2009 85.2 -8.2% 15.1 17.7% 12.0 14.1% (0.87) - - NM -

UOMO Media, Inc (OTCBB:UOMO) 1/31/2009 0.8 0.0% (0.6) -78.2% 0.1 18.5% (0.01) - - NM -

MOVIES & ENTERTAINMENT MEDIAN 32.8 0.0% (2.5) -5.1% 0.1 5.6% (0.35) - - 1.0% -

BlueRush Media Group Corp. (TSXV:BTV) 1/31/2009 3.1 0.0% 0.2 7.4% 0.1 4.6% 0.00 - - NM -

Cossette Communication Group Inc. (TSX:KOS) 3/31/2009 247.0 1.6% 33.8 13.7% 53.7 21.7% 0.35 238.1 23.2 9.7% 0.38

Cyberplex Inc. (TSX:CX) 3/31/2009 81.5 262.2% 8.4 10.3% 4.6 5.6% 0.18 111.4 12.7 11.4% 0.17

Empirical Inc. (TSXV:EM) 9/30/2008 10.5 3.0% (2.3) -21.8% (3.4) -31.8% (0.10) - - NM -

Envoy Capital Group, Inc. (TSX:ECG) 3/31/2009 9.9 -40.5% (7.4) -74.0% (2.9) -29.1% (1.36) - - NM -

MDC Partners Inc. (NasdaqGS:MDCA) 3/31/2009 570.5 2.5% 67.2 11.8% 86.0 15.1% 0.49 637.2 73.2 11.5% 0.19

Pareto Corp. (TSX:PTO) 3/31/2009 76.9 1.1% 7.1 9.3% 7.5 9.7% 0.08 - - NM -

Xentel DM Inc. (TSXV:XDM) 12/31/2008 96.2 -3.9% 5.3 5.5% 4.6 4.8% 0.06 - - NM -

ADVERTISING MEDIAN 79.2 1.3% 6.2 8.4% 4.6 5.2% 0.07 - - 11.4% -

Median 118.0 2.7% 13.0% 19.4 10.8% 111.4 17.5%

High 17,680.0 829.8% 55.4% 5,913.0 44.0% 17,605.4 53.9%

Low 0.0 -40.5% -173.1% (18.8) -174.7% - -121.8%


Figure 88. Financial Comparison

Source. Capital IQ


120

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

Price Performance

Company Name

Current

Price Currency

CAD

Market

Cap 1 Wk 1 Mth 3 Mth 6 Mth 1 Yr

52 Week

High

Asian Television Network International Ltd. (TSXV:SAT) 0.42 CAD 10.2 -10.6% 5.0% 20.0% -16.0% -63.5% -66.4%

Astral Media Inc. (TSX:ACM.A) 29.74 CAD 1,668.8 -5.9% -6.9% 24.7% 34.5% -10.3% -14.9%

CanWest Global Communications Corp. (TSX:CGS) 0.23 CAD 40.9 -11.5% -23.3% -16.4% -57.4% -93.6% -94.0%

Corus Entertainment Inc. (TSX:CJR.B) 14.81 CAD 1,185.3 -7.7% -12.4% 20.7% 17.5% -24.2% -27.0%

Newfoundland Capital Corp. Ltd. (TSX:NCC.A) 20.00 CAD 219.8 11.1% 11.1% 17.6% 15.9% 7.8% 0.0%

Score Media Inc. (TSX:SCR) 0.51 CAD 41.4 2.0% -7.3% 20.0% 70.0% -40.0% -46.3%

TVA GROUP Inc. (TSX:TVA.B) 9.00 CAD 215.7 -3.7% -2.8% 37.2% 16.1% -38.2% -44.6%

BROADCASTING MEDIAN 215.7 -5.9% -6.9% 20.0% 16.1% -38.2% -44.6%

Broadview Press Inc. (TSXV:BDP) 0.04 CAD 0.4 0.0% 16.7% 40.0% -36.4% -61.1% -61.1%

FP Canadian Newspapers Limited Partnership (TSX:FP.UN) 4.20 CAD 29.0 -3.2% -1.9% 2.4% -24.3% -66.3% -66.4%

Glacier Media, Inc. (TSX:GVC) 1.83 CAD 170.0 -1.1% -12.9% 4.6% -7.6% -54.8% -56.9%

Lingo Media Corporation (TSXV:LM) 1.05 CAD 13.5 5.0% 16.7% 20.7% 5.0% -41.7% -46.7%

McGraw-Hill Ryerson Ltd. (TSX:MHR) 37.00 CAD 73.9 1.4% 7.2% 2.8% 3.5% -17.8% -17.8%

MPL Communications Inc. (TSXV:MPZ) 0.02 CAD 0.4 0.0% 0.0% 0.0% 0.0% -63.6% -80.0%

Multimedia Nova Corp. (TSXV:MNC.A) 0.12 CAD 0.9 0.0% 0.0% 140.0% -76.0% -63.6% -76.0%

Quebecor Inc. (TSX:QBR.B) 18.10 CAD 1,164.1 -5.9% 7.1% -0.7% 26.8% -42.6% -44.2%

Thomson Reuters Corporation (TSX:TRI) 34.17 CAD 28,314.1 1.2% -5.5% 17.0% 5.1% -3.9% -9.9%

Torstar Corporation (TSX:TS.B) 4.82 CAD 380.7 -5.3% -24.8% 8.3% -38.6% -65.1% -69.4%

Transcontinental Inc. (TSX:TCL.A) 8.25 CAD 666.4 6.2% -1.8% 37.3% -21.4% -53.4% -54.6%

Yellow Pages Income Fund (TSX:YLO.UN) 5.40 CAD 2,750.3 -4.9% -5.3% 6.5% -17.4% -44.0% -47.8%

PUBLISHING MEDIAN 121.9 0.0% -0.9% 7.4% -12.5% -54.1% -55.8%

BCE, Inc. (TSX:BCE) 24.84 CAD 19,073.0 -0.2% -4.2% 3.2% 8.7% -27.9% -38.3%

Canadian Satellite Radio Holdings Inc (TSX:XSR) 0.55 CAD 27.2 10.0% 37.5% 120.0% -31.3% -86.3% -86.9%

Cogeco Cable Inc. (TSX:CCA) 28.77 CAD 1,397.0 7.4% -0.5% -9.3% 1.7% -27.5% -35.5%

Cogeco Inc. (TSX:CGO) 22.50 CAD 376.7 0.0% -2.0% 1.4% 23.0% -30.7% -35.5%

JumpTV Inc. (TSX:JTV) 0.78 CAD 88.8 2.6% 16.4% 105.3% 160.0% -4.9% -39.1%

Manitoba Telecom Services, Inc. (TSX:MBT) 34.27 CAD 2,215.9 2.3% -0.2% 4.5% -11.7% -19.9% -21.9%

Rogers Communications Inc. (TSX:RCI.B) 32.49 CAD 20,534.2 -0.6% 6.5% 24.0% -5.6% -20.5% -24.2%

Shaw Communications, Inc. (TSX:SJR.B) 18.72 CAD 8,048.0 -2.5% -4.2% 4.0% -13.5% -9.6% -22.6%

TELUS Corporation (TSX:T) 32.75 CAD 10,409.7 2.4% 9.5% 3.2% -6.9% -28.4% -30.7%

TELECOM MEDIAN 2,215.9 2.3% -0.2% 4.0% -5.6% -27.5% -35.5%

Cineplex Entertainment Limited Partnership (TSX:CGX.UN) 15.53 CAD 887.5 6.4% 5.9% 12.0% 16.8% -1.0% -6.0%

Cinram International Income Fund (TSX:CRW) 1.72 CAD 95.0 11.0% 44.5% 72.0% 22.0% -73.0% -73.5%

DHX Media Ltd. (TSX:DHX) 0.72 CAD 30.9 0.0% -4.0% 30.9% 38.5% -51.7% -56.4%

Entertainment One Ltd. (AIM:ETO) 0.30 GBP 71.6 -1.6% 87.5% 100.0% -7.7% -66.7% -66.7%

E-SOL International Corp. (OTCPK:ESIT) 4.05 USD 44.4 35.0% 3.8% 12.5% 19.5% 1.3% -25.0%

Fluid Music Canada, Inc. (TSX:FMN) 0.78 CAD 41.0 21.9% 41.8% 136.4% 200.0% - -61.8%

FRV Media, Inc. (TSXV:FRV) 0.01 CAD 0.3 0.0% 0.0% 0.0% -75.0% -87.5% -94.1%

IMAX Corporation (NasdaqGM:IMAX) 7.45 USD 357.1 2.9% 6.6% 81.7% 166.1% 0.9% -10.0%

Knightscove Media Corp. (TSXV:KC.A) 0.02 CAD 0.5 0.0% -42.9% 33.3% -73.3% -82.6% -92.0%

Lions Gate Entertainment Corp. (NYSE:LGF) 5.47 USD 701.7 -2.3% 9.2% 2.8% -21.6% -44.4% -50.1%

Peace Arch Entertainment Group Inc. (AMEX:PAE) 0.08 USD 4.4 -9.9% -11.1% 100.0% 14.3% -85.5% -88.4%

Rainmaker Entertainment Inc. (TSX:RNK) 1.00 CAD 17.5 0.0% 16.3% 66.7% 29.9% -53.1% -62.5%

Somerset Entertainment Income Fund (TSX:SOM.UN) 1.22 CAD 21.7 4.3% -2.4% -2.4% -21.3% -61.1% -67.9%

UOMO Media, Inc (OTCBB:UOMO) 0.22 USD 20.7 -8.3% 46.7% 214.3% 83.3% -56.9% -79.2%

MOVIES & ENTERTAINMENT MEDIAN 35.9 0.0% 6.3% 50.0% 18.1% -56.9% -64.6%

BlueRush Media Group Corp. (TSXV:BTV) 0.05 CAD 1.6 0.0% 0.0% 25.0% 25.0% -61.5% -68.8%

Cossette Communication Group Inc. (TSX:KOS) 2.85 CAD 45.0 1.1% -12.3% -18.1% -24.2% -52.9% -58.1%

Cyberplex Inc. (TSX:CX) 1.57 CAD 84.2 -5.4% -12.8% 348.6% 423.3% 96.3% -21.1%

Empirical Inc. (TSXV:EM) 0.01 CAD 0.3 - - 0.0% 0.0% -80.0% -91.7%

Envoy Capital Group, Inc. (TSX:ECG) 1.60 CAD 13.7 4.6% -8.6% -4.2% -4.2% -44.1% -46.1%

MDC Partners Inc. (NasdaqGS:MDCA) 5.71 USD 175.6 7.7% 14.7% 94.9% 99.0% -33.1% -35.0%

Pareto Corp. (TSX:PTO) 0.66 CAD 28.3 -22.4% 10.0% 34.7% 32.0% -34.0% -34.0%

Xentel DM Inc. (TSXV:XDM) 0.20 CAD 5.1 33.3% 33.3% 100.0% 122.2% -9.1% -13.0%

ADVERTISING MEDIAN 21.0 1.1% 0.0% 29.8% 28.5% -39.0% -40.6%

High 28,314.1 35.0% 87.5% 348.6% 423.3% 96.3% 0.0%

Low 0.3 -22.4% -42.9% -18.1% -76.0% -93.6% -94.1%

Average 1,897.7 1.2% 4.5% 40.2% 20.6% -40.6% -49.1%

Median 73.9 0.0% 0.0% 20.0% 5.0% -43.3% -46.7%


Figure 89. Price Performance Comparison

Source. Capital IQ


121

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


Operating Statistics

Company Name

1 Yr Total

Rev

Growth

1 Yr

EBITDA

Growth

1 Yr

EBIT

Growth

1 Yr Net

Income

Growth

LTM Gross

Margin

LTM EBIT

Margin

LTM

EBITDA

Margin

Est. LT

Growth

Rate

LTM Net

Income

Margin

Total

Debt/Tot

al Capital

Total

Debt/LTM

EBITDA

EBITDA /

Total Interest

Expense

EBITDA-Cap Ex/

Total Interest

Expense

Total Debt /

Total Book

Value

Return

On

Assets

Return

On

Equity

Return

On

Capital

Asian Television Network International Ltd. (TSXV:SAT) 2.8% (11.1%) (24.3%) (14.0%) 15.5% 6.8% 15.5% - 4.1% 17.4% 0.35x 22.85x 21.01x 21.1 9.1% 17.2% 13.0%

Astral Media Inc. (TSX:ACM.A) 25.6% 27.5% 27.0% (9.0%) 33.3% 30.5% 33.3% 9.2% 16.8% 36.2% 2.60x 7.01x 5.92x 56.7 6.4% 11.5% 8.1%

CanWest Global Communications Corp. (TSX:CGS) 4.0% 0.0% (3.3%) NM 44.1% 13.4% 17.4% - (81.1%) 126.9% 7.62x 1.66x 1.28x NM 4.0% (759.4%) 6.3%

Corus Entertainment Inc. (TSX:CJR.B) 1.7% 1.8% 2.9% (0.7%) 33.5% 29.1% 31.7% 13.6% 15.8% 40.9% 2.81x 6.23x 5.83x 70.6 7.1% 12.5% 8.6%

Newfoundland Capital Corp. Ltd. (TSX:NCC.A) (4.7%) (53.4%) (66.0%) NM 9.4% 5.6% 9.4% - (4.4%) 45.0% 7.94x 2.26x 1.14x 81.9 1.5% (4.5%) 2.1%

Score Media Inc. (TSX:SCR) 10.7% 10.8% (49.2%) (42.4%) 48.9% 3.1% 13.0% - 2.8% 18.2% 1.14x 26.16x NM 22.3 2.2% 4.3% 2.6%

TVA GROUP Inc. (TSX:TVA.B) 2.7% (0.0%) (2.3%) 6.6% 15.3% 12.1% 15.3% - 10.4% 32.0% 1.53x 14.69x 9.12x 49.6 7.3% 21.5% 10.8%

BROADCASTING MEDIAN 2.8% 0.0% (3.3%) (9.0%) 33.3% 12.1% 15.5% - 4.1% 36.2% 2.60x 7.01x 5.88x 53.1 6.4% 11.5% 8.1%

Broadview Press Inc. (TSXV:BDP) (26.3%) NM NM NM 57.6% (3.7%) (2.7%) - 3.6% 17.8% NM NM NM 21.6 (2.3%) 7.6% (3.6%)

FP Canadian Newspapers Limited Partnership (TSX:FP.UN (6.4%) (26.6%) (32.4%) (62.6%) 17.9% 13.9% 17.9% - 4.3% 87.6% 5.51x 2.02x 1.89x 703.7 6.9% 26.0% 7.5%

Glacier Media, Inc. (TSX:GVC) 10.5% (7.4%) (11.4%) (33.6%) 36.5% 14.1% 18.4% - 9.3% 28.2% 2.71x 5.25x 3.97x 40.7 4.2% 7.8% 5.0%

Lingo Media Corporation (TSXV:LM) 383.0% NM NM NM 86.3% (174.6%) (173.1%) - NM - - NM NM - (14.4%) (39.3%) (17.6%)

McGraw-Hill Ryerson Ltd. (TSX:MHR) 2.7% (8.1%) (8.6%) (1.6%) 53.5% 17.1% 18.6% - 11.0% - - - - - 12.3% 14.8% 14.4%

MPL Communications Inc. (TSXV:MPZ) (12.7%) (0.2%) 5.7% NM 54.0% 3.7% 4.9% - (19.7%) NM 0.75x - - NM 1.9% NM 134.4%

Multimedia Nova Corp. (TSXV:MNC.A) 0.7% NM NM NM 36.0% 2.1% 5.5% - (11.6%) 97.6% 11.69x 0.72x 0.54x 4,049.1 1.3% (212.1%) 2.0%

Quebecor Inc. (TSX:QBR.B) 7.4% 10.9% 11.8% NM 30.3% 21.6% 30.3% 24.6% (4.9%) 71.0% 4.22x 3.92x 2.09x 512.1 6.3% (17.3%) 7.9%

Thomson Reuters Corporation (TSX:TRI) 74.2% 72.1% 56.9% (63.8%) 28.9% 15.5% 23.3% 11.5% 11.1% 29.0% 2.65x 7.28x 4.81x 41.0 - 8.7% 5.5%

Torstar Corporation (TSX:TS.B) 0.2% (8.7%) (12.4%) NM 100.0% 9.3% 12.9% - (13.0%) 50.5% 3.30x 7.57x 6.54x 102.1 4.8% (26.2%) 6.2%

Transcontinental Inc. (TSX:TCL.A) 3.7% (5.9%) (9.3%) NM 25.7% 8.6% 13.8% 7.0% (1.3%) 44.0% 2.53x 11.88x 1.42x 78.6 5.4% (2.9%) 7.1%

Yellow Pages Income Fund (TSX:YLO.UN) 2.2% 4.1% 16.1% (3.7%) 55.4% 45.4% 55.4% - 30.4% 31.3% 2.93x 5.73x 5.46x 49.6 5.2% 9.1% 5.5%

PUBLISHING MEDIAN 2.5% (5.9%) (8.6%) (33.6%) 45.0% 11.6% 15.9% - 3.6% 31.3% 2.71x 4.59x 1.99x 49.6 4.5% 7.6% 5.8%

BCE, Inc. (TSX:BCE) (0.3%) 3.8% 6.5% (72.2%) 74.9% 20.3% 38.7% 3.8% 6.0% 40.7% 1.80x 8.72x 4.86x 73.0 5.8% 6.7% 7.5%

Canadian Satellite Radio Holdings Inc (TSX:XSR) 58.4% NM NM NM 35.1% (100.5%) (53.5%) - (195.9%) 81.5% NM NM NM 441.3 (11.6%) (119.3%) (14.2%)

Cogeco Cable Inc. (TSX:CCA) 16.2% 20.0% 19.5% NM 42.4% 20.1% 39.7% 8.5% (23.4%) 55.7% 2.63x 6.27x 2.91x 125.6 5.4% (24.7%) 6.8%

Cogeco Inc. (TSX:CGO) 15.9% 21.9% 23.2% NM 41.0% 20.0% 39.1% 15.0% (7.1%) 55.9% 2.63x 6.25x 2.94x 388.7 5.4% (23.8%) 6.9%

JumpTV Inc. (TSX:JTV) 72.1% NM NM NM 43.2% (74.3%) (62.6%) - (86.6%) - - - - - (20.5%) (57.8%) (31.0%)

Manitoba Telecom Services, Inc. (TSX:MBT) 0.4% (5.1%) (13.2%) (25.8%) 32.7% 15.5% 32.7% 3.0% 6.6% 37.0% 1.29x 12.71x 5.89x 58.8 7.0% 9.1% 8.5%

Rogers Communications Inc. (TSX:RCI.B) 10.0% 7.2% 7.1% 19.2% 87.9% 20.8% 36.2% 12.7% 8.4% 64.3% 2.11x 6.86x 3.46x 180.1 9.4% 20.2% 12.2%

Shaw Communications, Inc. (TSX:SJR.B) 11.3% 12.2% 13.9% (15.5%) 40.0% 29.0% 42.4% 32.0% 16.6% 55.3% 2.16x 5.98x 2.42x 123.5 7.1% 23.4% 11.5%

TELUS Corporation (TSX:T) 5.0% (1.2%) (4.3%) (14.5%) 69.2% 21.7% 39.4% 13.0% 12.0% 47.1% 1.71x 7.92x 3.74x 89.3 7.1% 16.3% 10.1%

TELECOM MEDIAN 11.3% 7.2% 7.1% (15.5%) 42.4% 20.1% 38.7% 8.5% 6.0% 55.3% 1.95x 6.56x 3.20x 123.5 5.8% 6.7% 7.5%

Cineplex Entertainment Limited Partnership (TSX:CGX.UN 6.7% 5.9% 12.4% 37.6% 45.2% 9.5% 17.2% - 4.7% 115.6% 2.45x 3.83x 2.17x NM 7.1% NM 15.4%

Cinram International Income Fund (TSX:CRW) 1.3% (18.4%) (21.3%) NM 17.0% 5.0% 13.2% - (2.8%) 101.4% 2.54x 5.17x 3.55x NM 5.0% (220.1%) 8.7%

DHX Media Ltd. (TSX:DHX) 29.5% (6.5%) (8.5%) NM 33.4% 5.9% 10.1% - (2.8%) 52.6% 10.39x 15.01x 12.27x 111.6 1.5% (1.2%) 2.0%

Entertainment One Ltd. (AIM:ETO) - - - - 23.9% (0.6%) 7.5% - (3.2%) 34.1% 4.04x 4.30x 3.93x 51.7 - - -

E-SOL International Corp. (OTCPK:ESIT) 829.8% - NM NM NM NM NM - NM 6.9% NM NM NM 7.4 (1.6%) (2.8%) (1.6%)

Fluid Music Canada, Inc. (TSX:FMN) 158.3% NM NM NM 46.4% (187.3%) (138.1%) - NM 1.1% NM NM NM 1.1 (40.9%) (243.0%) (66.5%)

FRV Media, Inc. (TSXV:FRV) - - - - 23.2% (55.8%) (53.9%) - (63.8%) 97.5% NM NM NM 3,858.1 - - -

IMAX Corporation (NasdaqGM:IMAX) 5.5% NM NM NM 32.6% (12.2%) (4.2%) - (23.3%) 220.9% NM NM NM NM (4.0%) NM (11.7%)

Knightscove Media Corp. (TSXV:KC.A) - - - - 57.1% (14.9%) (13.9%) - (13.0%) 74.7% NM NM NM 295.8 - - -

Lions Gate Entertainment Corp. (NYSE:LGF) 28.3% NM NM NM 46.0% (5.6%) (5.1%) 27.1% (6.9%) 96.5% NM NM NM 2,775.6 (3.8%) (129.1%) (13.0%)

Peace Arch Entertainment Group Inc. (AMEX:PAE) 25.3% NM NM NM 26.8% (6.0%) (4.1%) - (22.4%) 60.5% NM NM NM 153.2 (1.8%) (51.8%) (3.0%)

Rainmaker Entertainment Inc. (TSX:RNK) (8.3%) (63.1%) NM NM 9.9% (8.7%) 5.6% - (7.5%) 64.1% 7.53x 1.83x 0.18x 178.7 (4.7%) (27.3%) (7.6%)

Somerset Entertainment Income Fund (TSX:SOM.UN) (8.2%) (15.1%) (22.7%) NM 39.0% 10.0% 17.7% - (18.3%) 32.4% 0.67x 22.76x 22.09x 48.0 8.0% (46.4%) 12.0%

UOMO Media, Inc (OTCBB:UOMO) - NM NM NM 2.4% (78.7%) (78.2%) - (78.7%) NM NM - - NM (73.5%) NM NM

MOVIES & ENTERTAINMENT MEDIAN 3.4% - - - 32.6% (6.0%) (4.1%) - (10.3%) 64.1% 3.29x 4.30x 3.55x 132.4 (0.8%) (27.3%) -

BlueRush Media Group Corp. (TSXV:BTV) - - - - 34.7% 6.7% 7.4% - 3.4% 1.0% 0.04x - - 1.0 - - -

Cossette Communication Group Inc. (TSX:KOS) 1.6% 2.4% (1.8%) (56.2%) 39.5% 10.1% 13.7% - 2.3% 15.2% 0.75x 24.94x 22.07x 18.5 4.9% 4.2% 9.4%

Cyberplex Inc. (TSX:CX) 262.2% NM NM NM 33.2% 9.8% 10.3% - 12.1% 3.8% 0.11x 86.98x 83.11x 4.0 18.4% 53.9% 26.6%

Empirical Inc. (TSXV:EM) 3.0% NM NM NM 54.5% (43.6%) (21.8%) - (54.9%) 399.3% NM NM NM NM (47.2%) NM (140.6%)

Envoy Capital Group, Inc. (TSX:ECG) (40.5%) NM NM NM (33.2%) (81.3%) (74.0%) - (118.8%) 0.1% NM NM NM 0.1 (12.2%) (32.3%) (13.7%)

MDC Partners Inc. (NasdaqGS:MDCA) 2.5% (3.4%) (5.2%) NM 33.0% 3.7% 9.4% 15.0% 0.6% 56.2% 3.54x 3.61x 2.86x 211.7 2.5% 10.1% 4.0%

Pareto Corp. (TSX:PTO) 1.1% 10.9% 11.3% 16.0% 10.3% 8.1% 9.3% - 4.9% 8.8% 0.37x 21.46x 19.25x 9.7 8.5% 14.2% 12.8%

Xentel DM Inc. (TSXV:XDM) (3.9%) 304.8% NM NM 23.7% 3.1% 5.5% - 1.6% 25.1% 0.64x 12.35x 10.77x 33.5 9.1% 17.6% 14.5%

ADVERTISING MEDIAN 1.3% 2.4% (0.9%) - 33.1% 5.2% 8.4% - 1.9% 12.0% 0.51x 16.91x 15.01x 9.7 3.7% 10.1% 6.7%

Median 2.8% - (0.9%) (9.0%) 34.9% 7.5% 13.0% - 1.1% 40.9% 2.53x 6.25x 3.55x 57.8 4.2% 2.1% 6.2%

Average 36.1% 6.8% (2.2%) (14.6%) 37.7% (6.2%) 2.2% 3.7% (12.7%) 54.3% 2.76x 9.80x 7.36x 323.1 (0.4%) (34.3%) 2.2%

High 829.8% 304.8% 56.9% 37.6% 100.0% 45.4% 55.4% 32.0% 30.4% 399.3% 11.69x 86.98x 83.11x 4,049.1 18.4% 53.9% 134.4%

Low (40.5%) (63.1%) (66.0%) (72.2%) (33.2%) (187.3%) (173.1%) - (195.9%) - - - - - (73.5%) (759.4%) (140.6%)

Figure 90. Operating Statistics Comparison

Source. Capital IQ


122

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


Trading Multiples

Company Name

USD

Market

Cap

($ mm)

USD

Enterprise

Value

($ mm)

Dividend

Yield

CFFO

Yield

CFFO

Yield

(EV) P/ CFFO EV/ CFFO FCF Yield P/FCF

TEV/

LTM

EBITDA

TEV/

NTM

EBITDA

TEV/

EBITDA

CY

TEV/

EBITDA

CY+1

P/LTM

EPS

P/NTM

EPS P/E CY

P/E

CY+1



Central European Media Enterprises Ltd. (NasdaqGS:CETV) 1,334.1 2,246.9 NM 5.2% 3.1% 19.2x 32.3x 24.3% 4.1x 8.8x 11.8x 12.2x 10.9x NM 17.8x 18.7x 15.4x














Gannett Co., Inc. (NYSE:GCI) 985.5 4,820.8 3.8% 86.9% 17.8% 1.2x 5.6x 88.3% 1.1x 3.4x 5.2x 5.2x 5.1x NM 3.5x 3.2x 3.3x

Interactive Data Corporation (NYSE:IDC) 2,292.0 2,048.4 3.3% 8.3% 9.3% 12.0x 10.7x 5.3% 18.8x 7.8x 7.5x 7.6x 6.9x 16.5x 17.0x 17.4x 15.7x

John Wiley & Sons Inc. (NYSE:JW.A) 1,872.2 2,687.8 1.6% 13.6% 9.4% 7.4x 10.6x NM NM 8.5x 8.7x 8.7x NM 14.4x 13.3x 13.4x NM

Lee Enterprises Inc. (NYSE:LEE) 42.7 1,236.9 NM 237.1% 8.2% 0.4x 12.2x 135.8% 0.7x 6.9x NM NM NM NM NM NM NM

Media General, Inc. (NYSE:MEG) 63.7 785.3 NM 92.1% 7.5% 1.1x 13.4x 218.7% 0.5x 7.4x NM 7.5x 6.8x NM NM NM NM

Meredith Corp. (NYSE:MDP) 1,323.4 1,704.0 3.1% 14.2% 11.0% 7.0x 9.1x 10.3% 9.7x 7.7x 8.3x 8.3x NM 16.5x 14.5x 14.6x 12.9x

Morningstar Inc. (NasdaqGS:MORN) 2,020.5 1,734.8 NM 7.1% 8.2% 14.2x 12.2x 2.6% 39.0x 10.4x NM NM NM 22.1x 23.5x 23.7x 21.7x

Scholastic Corporation (NasdaqGS:SCHL) 765.0 1,101.8 1.4% 5.1% 3.5% 19.6x 28.3x 4.6% 21.7x 7.6x 5.6x 5.8x NM NM 13.2x 14.1x NM

The McClatchy Company (NYSE:MNI) 70.3 2,087.6 NM 451.9% 15.2% 0.2x 6.6x 540.3% 0.2x 5.9x 8.9x 8.5x 10.4x NM NM NM NM

The McGraw-Hill Companies, Inc. (NYSE:MHP) 9,670.9 10,602.4 2.9% 13.9% 12.7% 7.2x 7.9x 13.1% 7.6x 6.7x 6.8x 7.0x 6.3x 12.4x NM 13.6x 11.9x

The New York Times Company (NYSE:NYT) 928.6 2,179.1 NM 24.8% 10.6% 4.0x 9.5x NM NM 6.8x 10.2x 10.3x 9.9x NM NM NM 51.6x

Valassis Communications Inc. (NYSE:VCI) 332.3 1,363.7 NM 39.9% 9.7% 2.5x 10.3x 29.9% 3.3x 7.1x 6.6x 6.7x 6.5x NM 9.9x 10.2x 9.1x

Washington Post Co. (NYSE:WPO) 3,329.0 3,089.5 2.4% 15.8% 17.0% 6.3x 5.9x 6.3% 15.9x 5.8x 5.2x 5.5x 4.3x NM 18.6x 21.5x 13.4x


Cablevision Systems Corporation (NYSE:CVC) 5,591.1 17,449.3 2.2% 25.9% 8.3% 3.9x 12.0x 13.8% 7.3x 7.5x 7.3x 7.1x 6.8x NM 19.7x 19.2x 14.3x

Comcast Corporation (NasdaqGS:CMCS.A) 41,722.4 72,113.4 1.9% 25.1% 14.5% 4.0x 6.9x 8.5% 11.8x 5.4x 5.2x 5.3x 5.1x 16.3x 14.4x 13.4x 12.0x

DIRECTV Group, Inc. (NasdaqGS:DTV) 22,336.6 26,372.6 NM 17.0% 14.4% 5.9x 6.9x 6.9% 14.4x 5.3x 4.7x 4.9x 4.3x 17.8x NM 15.0x 10.5x

Dish Network Corp. (NasdaqGS:DISH) 7,138.5 11,103.0 NM 30.6% 19.7% 3.3x 5.1x NM NM 4.9x 3.9x 3.7x 3.8x 7.6x 7.4x 7.2x 7.3x

Knology, Inc. (NasdaqGM:KNOL) 288.4 833.6 NM 29.8% 10.3% 3.4x 9.7x 11.7% 8.5x 6.4x 5.8x 5.9x 5.6x NM 29.2x 45.5x 20.8x

Liberty Entertainment Group (NasdaqGS:LMDI.A) 12,128.5 13,280.5 NM NM NM NM NM NM NM 62.9x 37.7x 37.7x 37.3x 2.1x 21.1x 21.1x 18.7x

Liberty Global Inc. (NasdaqGS:LBTY.A) 3,800.0 24,910.7 NM 84.1% 12.8% 1.2x 7.8x 27.0% 3.7x 5.6x 5.3x 5.4x 5.2x NM 32.4x 81.2x 11.6x

Mediacom Communications Corp. (NasdaqGS:MCCC) 434.4 3,782.0 NM 69.4% 8.0% 1.4x 12.5x 3.0% 33.5x 7.3x 7.0x 7.1x 6.9x NM 10.8x 11.2x 9.8x

Outdoor Channel Holdings, Inc. (NasdaqGM:OUTD) 179.6 128.0 NM 5.2% 7.3% 19.3x 13.8x 1.9% NM 17.4x NM 11.1x NM 94.8x 68.2x 77.7x 49.9x

RCN Corp. (NasdaqGS:RCNI) 227.2 896.9 NM 62.7% 15.9% 1.6x 6.3x 11.7% 8.5x 4.7x 4.2x 4.3x 4.1x NM NM NM NM

RRSat Global Communications Network Ltd. (NasdaqGS:RRST) 200.1 160.8 5.3% 9.6% 11.9% 10.4x 8.4x 4.7% 21.2x 7.6x 6.0x 6.3x 5.4x 14.5x 13.6x 14.1x 12.1x

Scripps Networks Interactive, Inc. (NYSE:SNI) 4,721.0 4,832.2 1.0% 13.1% 12.8% 7.6x 7.8x 15.4% 6.5x 7.2x 7.8x 8.0x 7.2x NM 17.8x 18.0x 16.0x

SIRIUS XM Radio Inc. (NasdaqGS:SIRI) 1,350.0 4,061.0 NM 4.0% 1.3% 25.3x NM 52.1% 1.9x 31.4x 11.2x 12.8x 8.3x NM NM NM NM

Time Warner Cable Inc. (NYSE:TWC) 11,387.5 34,453.5 NM 46.1% 15.3% 2.2x 6.6x 9.4% 10.7x 5.5x 5.4x 5.5x 5.2x NM 10.1x 10.9x 9.3x

Virgin Media, Inc. (NasdaqGS:VMED) 2,930.4 8,970.8 1.3% 37.8% 12.4% 2.6x 8.1x 19.0% 5.3x 4.8x 4.2x 4.2x 4.0x NM NM NM NM


Cinemark Holdings Inc. (NYSE:CNK) 1,225.0 2,591.0 6.4% 23.2% 11.0% 4.3x 9.1x 13.5% 7.4x 7.4x 6.7x 6.8x 6.4x NM 16.4x 16.7x 14.5x

CTC Media, Inc (NasdaqGS:CTCM) 1,762.0 1,745.6 NM 10.5% 10.6% 9.5x 9.4x 22.5% 4.5x 6.1x 8.5x 8.9x 7.6x NM 14.5x 15.4x 12.4x

DreamWorks Animation SKG Inc. (NasdaqGS:DWA) 2,505.4 2,317.8 NM 5.7% 6.2% 17.5x 16.2x 14.5% 6.9x 10.3x NM 11.8x 8.8x 14.5x 31.0x 19.1x 14.3x

Liberty Media Capital (NasdaqGS:LCAP.A) 1,412.6 1,855.6 NM 3.7% 2.8% 27.2x 35.7x 3.0% 33.1x NM NM NM NM NM NM NM NM

Lions Gate Entertainment Corp. (NYSE:LGF) 640.2 829.2 NM 13.2% 10.2% 7.6x 9.8x 64.1% 1.6x NM 52.1x 52.1x 10.7x NM NM NM 15.9x

Live Nation, Inc. (NYSE:LYV) 459.0 1,003.9 NM NM NM NM NM NM NM 7.5x 5.4x 5.9x 4.4x NM NM NM NM

LodgeNet Interactive Corporation (NasdaqGS:LNET) 129.3 683.9 NM 76.5% 14.5% 1.3x 6.9x 46.7% 2.1x 5.3x NM NM NM NM NM NM NM

Marvel Entertainment, Inc. (NYSE:MVL) 2,809.6 2,787.2 NM 12.0% 12.1% 8.4x 8.3x 12.1% 8.3x 7.9x 13.9x 14.8x 9.6x 13.8x 28.8x 27.0x 17.7x

News Corp. (NasdaqGS:NWSA) 26,839.2 35,713.2 1.2% 8.8% 6.6% 11.4x 15.2x 7.5% 13.3x 6.9x 7.1x 7.3x 6.6x NM 13.7x 14.8x 11.3x

Regal Entertainment Group (NYSE:RGC) 1,861.5 3,673.7 6.0% 15.5% 7.8% 6.5x 12.8x 7.4% 13.5x 7.3x 6.7x 6.6x 6.4x 27.9x NM 15.2x 13.1x

RHI Entertainment, Inc. (NasdaqGM:RHIE) 42.4 676.9 NM NM NM NM NM 208.2% 0.5x 38.1x 9.5x 10.0x 8.3x NM NM NM 6.9x

Time Warner Inc. (NYSE:TWX) 29,289.2 40,298.2 3.1% 34.6% 25.2% 2.9x 4.0x 31.9% 3.1x 3.1x 6.0x 6.2x 6.1x NM 12.0x 12.4x 10.9x

Viacom, Inc. (NYSE:VIA.B) 13,796.5 20,922.5 NM 15.2% 10.0% 6.6x 10.0x 45.6% 2.2x 6.5x 6.6x 7.0x 6.7x 12.3x 9.7x 11.1x 9.9x

Walt Disney Co. (NYSE:DIS) 46,678.7 59,064.7 1.4% 9.1% 7.2% 11.0x 13.9x 5.9% 17.0x 7.8x 7.3x 7.6x 6.8x 13.6x 14.0x 14.7x 12.8x

Warner Music Group Corp. (NYSE:WMG) 1,117.7 2,681.7 NM 35.3% 14.7% 2.8x 6.8x 19.8% 5.1x 6.1x 6.4x 6.4x 6.5x NM NM NM NM

World Wrestling Entertainment Inc. (NYSE:WWE) 983.1 784.6 10.7% 7.0% 8.7% 14.3x 11.4x 5.2% 19.4x 10.0x 8.3x 9.3x 8.3x 27.5x 19.0x 22.3x 19.1x


AirMedia Group Inc. (NasdaqGM:AMCN) 425.5 279.7 NM NM NM NM NM NM NM 12.2x 38.7x NM 6.4x 20.4x NM NM 16.9x

Arbitron Inc. (NYSE:ARB) 545.5 619.2 1.9% 7.9% 6.9% 12.7x 14.4x NM NM 8.7x 6.8x 7.3x 6.0x 16.6x 12.6x 14.0x 10.8x

Clear Channel Outdoor Holdings Inc. (NYSE:CCO) 1,828.2 4,539.4 NM 32.7% 13.2% 3.1x 7.6x 25.6% 3.9x 6.8x 9.3x 9.3x 7.9x NM NM NM NM

Focus Media Holding Ltd. (NasdaqGS:FMCN) 1,111.1 970.8 NM NM NM NM NM NM NM 13.5x 5.6x 5.6x 7.6x NM 39.7x 39.7x 33.5x

Harte-Hanks Inc. (NYSE:HHS) 584.2 798.0 3.3% 19.3% 14.1% 5.2x 7.1x 14.6% 6.8x 5.6x 7.1x 7.1x 6.9x 10.4x 13.5x 13.8x 12.9x

Interpublic Group of Companies Inc. (NYSE:IPG) 2,583.3 3,868.5 NM 23.1% 15.4% 4.3x 6.5x 11.8% 8.5x 4.8x 5.6x 5.6x 5.4x 10.5x 15.2x 14.8x 12.1x

Lamar Advertising Co. (NasdaqGS:LAMR) 1,665.9 4,457.3 NM 20.8% 7.8% 4.8x 12.9x 10.0% 10.0x 9.2x 10.7x 10.8x 10.3x NM NM NM NM


National CineMedia, Inc. (NasdaqGS:NCMI) 582.1 934.8 4.6% 20.7% 12.9% 4.8x 7.8x 11.6% 8.7x 4.9x 4.9x 5.0x 4.5x 33.2x 21.2x 22.2x 18.7x

Omnicom Group Inc. (NYSE:OMC) 9,950.1 12,681.8 1.9% 16.8% 13.2% 5.9x 7.6x 10.2% 9.8x 6.7x 7.8x 7.8x 7.5x 10.5x 12.5x 12.4x 11.9x

ValueClick Inc. (NasdaqGS:VCLK) 998.4 893.9 NM 12.2% 13.6% 8.2x 7.3x 8.8% 11.3x 8.5x 6.5x 6.5x 6.1x NM 18.2x 18.6x 16.7x



Low 12.9 128.0 1.0% 3.7% 1.3% 0.2x 4.0x 1.9% 0.2x 3.1x 3.9x 3.7x 3.8x 2.1x 2.4x 0.6x 1.9x


EBITDA EPS

Figure 91. Valuation Comparison

Source. Capital IQ

APPENDIX 2

C O M P T A B L E S U . S . M E D I A


123

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

(In millions of the reported currency except share and per share data)

Company Name LTM as of

LTM

Total

Rev

1 Yr.

Revenue

Growth

LTM

EBITDA

As % of

Revenue CFFO

As % of

Revenue

LTM Diluted

EPS

Before Extra

NTM Total

Rev Est.

NTM

EBITDA

Est.

As % of

Revenue

NTM

Diluted

EPS Est.

Belo Corp. (NYSE:BLC) 3/31/2009 692.2 -10.5% 225.6 32.6% 147.5 21.3% (3.02) - - NM -

CBS Corporation (NYSE:CBS) 3/31/2009 13,456.2 -4.4% 2,253.9 16.7% 1,098.2 8.2% (17.85) 12,884.0 1,870.3 14.5% 0.63

Central European Media Enterprises Ltd. (NasdaqGS:CETV) 3/31/2009 938.1 2.6% 256.6 27.3% 69.5 7.4% (7.35) 783.5 189.9 24.2% 1.22

Crown Media Holdings Inc. (NasdaqGM:CRWN) 3/31/2009 282.2 12.3% 208.2 73.8% 47.4 16.8% (0.32) - - NM -

Cumulus Media Inc. (NasdaqGS:CMLS) 3/31/2009 294.0 -10.6% 79.1 26.9% 72.6 24.7% (8.66) - - NM -

Discovery Communications, Inc. (NasdaqGS:DISC.A) 3/31/2009 3,451.0 385.3% 1,384.0 40.1% 642.0 18.6% 1.01 3,515.1 1,339.7 38.1% 1.31

Emmis Communications Corp. (NasdaqGS:EMMS) 2/28/2009 333.9 -6.8% 58.9 17.7% 46.5 13.9% (7.81) 304.0 40.0 13.2% (0.18)

Entercom Communications Corp. (NYSE:ETM) 3/31/2009 418.8 -9.7% 122.8 29.3% 128.5 30.7% (14.26) 369.4 96.3 26.1% 0.80

Gray Television Inc. (NYSE:GTN) 3/31/2009 317.5 2.9% 107.7 33.9% 65.7 20.7% (4.50) 270.8 75.8 28.0% (0.55)

Grupo Televisa SA (NYSE:TV) 3/31/2009 3,526.3 16.8% 1,420.4 40.3% 1,485.9 42.1% 0.97 3,748.1 1,516.9 40.5% 1.14

Hearst-Argyle Television Inc. (NYSE:HTV) 3/31/2009 689.3 -8.3% 179.9 26.1% 147.4 21.4% (5.72) 619.6 133.3 21.5% 0.13

LIN TV Corp. (NYSE:TVL) 3/31/2009 381.2 -4.0% 109.7 28.8% 64.9 17.0% (15.81) - - NM -

Nexstar Broadcasting Group Inc. (NasdaqGM:NXST) 3/31/2009 276.7 3.1% 85.6 30.9% 46.7 16.9% (1.99) - - NM -

Radio One Inc. (NasdaqGM:ROIA.K) 3/31/2009 304.6 -4.2% 82.0 26.9% 22.4 7.4% (3.97) - - NM -

Sinclair Broadcast Group Inc. (NasdaqGS:SBGI) 3/31/2009 722.6 -2.3% 212.3 29.4% 186.9 25.9% (4.08) 659.0 164.8 25.0% 0.16

BROADCASTING MEDIAN 418.8 -4.0% 179.9 29.3% 72.6 18.6% (4.50) 304.0 75.8 25.0% -

Gannett Co., Inc. (NYSE:GCI) 3/29/2009 6,469.3 -11.2% 1,408.6 21.8% 856.0 13.2% (29.60) 5,824.3 929.4 16.0% 1.22

Interactive Data Corporation (NYSE:IDC) 3/31/2009 754.9 6.5% 263.4 34.9% 190.6 25.3% 1.48 778.7 271.9 34.9% 1.44

John Wiley & Sons Inc. (NYSE:JW.A) 1/31/2009 1,640.4 0.6% 317.8 19.4% 253.7 15.5% 2.23 1,585.3 309.4 19.5% 2.43

Lee Enterprises Inc. (NYSE:LEE) 3/29/2009 943.7 -13.4% 178.4 18.9% 101.2 10.7% (6.72) - - NM -

Media General, Inc. (NYSE:MEG) 3/29/2009 765.1 -12.6% 106.7 13.9% 58.7 7.7% (28.68) 684.8 - 0.0% -

Meredith Corp. (NYSE:MDP) 3/31/2009 1,473.3 -8.2% 222.6 15.1% 188.2 12.8% 1.79 1,403.6 205.9 14.7% 2.03

Morningstar Inc. (NasdaqGS:MORN) 3/31/2009 493.7 6.2% 166.8 33.8% 142.7 28.9% 1.92 471.8 - 0.0% 1.81

Scholastic Corporation (NasdaqGS:SCHL) 2/28/2009 1,920.4 -10.5% 144.2 7.5% 39.0 2.0% 0.13 1,898.1 195.3 10.3% 1.60

The McClatchy Company (NYSE:MNI) 3/29/2009 1,777.8 -18.5% 356.8 20.1% 317.5 17.9% (0.41) - 235.3 NM (0.26)

The McGraw-Hill Companies, Inc. (NYSE:MHP) 3/31/2009 6,285.4 -6.1% 1,581.7 25.2% 1,348.1 21.4% 2.47 6,120.8 1,555.7 25.4% -

The New York Times Company (NYSE:NYT) 3/29/2009 2,810.0 -11.0% 321.5 11.4% 230.0 8.2% (0.98) 2,418.5 214.5 8.9% 0.06

Valassis Communications Inc. (NYSE:VCI) 3/31/2009 2,336.0 -5.7% 192.5 8.2% 132.5 5.7% (4.28) 2,244.0 205.7 9.2% 0.70

Washington Post Co. (NYSE:WPO) 3/29/2009 4,452.6 4.6% 530.9 11.9% 526.3 11.8% 0.73 4,452.4 599.9 13.5% 19.00

PUBLISHING MEDIAN 1,777.8 -8.2% 263.4 18.9% 190.6 12.8% 0.13 1,585.3 214.5 13.5% 1.22

Cablevision Systems Corporation (NYSE:CVC) 3/31/2009 7,412.0 11.6% 2,318.7 31.3% 1,449.6 19.6% (0.60) 7,788.6 2,386.7 30.6% 0.94

Comcast Corporation (NasdaqGS:CMCS.A) 3/31/2009 34,702.0 8.8% 13,402.0 38.6% 10,484.0 30.2% 0.89 35,957.3 13,756.2 38.3% 1.00

DIRECTV Group, Inc. (NasdaqGS:DTV) 3/31/2009 20,003.0 11.6% 4,948.0 24.7% 3,796.0 19.0% 1.24 21,963.8 5,652.2 25.7% -

Dish Network Corp. (NasdaqGS:DISH) 3/31/2009 11,678.1 3.4% 2,268.8 19.4% 2,183.8 18.7% 2.10 11,610.8 2,853.9 24.6% 2.16

Knology, Inc. (NasdaqGM:KNOL) 3/31/2009 413.6 8.8% 131.3 31.7% 85.9 20.8% (0.31) 426.5 143.3 33.6% 0.28

Liberty Entertainment Group (NasdaqGS:LMDI.A) 9/30/2008 1,316.0 0.0% 211.0 16.0% - 0.0% 11.10 1,469.5 352.0 24.0% 1.11

Liberty Global Inc. (NasdaqGS:LBTY.A) 3/31/2009 10,527.9 10.7% 4,423.2 42.0% 3,194.4 30.3% (3.12) 10,767.2 4,664.4 43.3% 0.43

Mediacom Communications Corp. (NasdaqGS:MCCC) 3/31/2009 1,422.7 7.4% 515.6 36.2% 301.7 21.2% (0.27) 1,476.1 537.5 36.4% 0.60

Outdoor Channel Holdings, Inc. (NasdaqGM:OUTD) 3/31/2009 59.4 26.2% 7.3 12.4% 9.3 15.6% 0.07 - - NM 0.10

RCN Corp. (NasdaqGS:RCNI) 3/31/2009 748.7 13.0% 191.8 25.6% 142.4 19.0% (1.47) 768.3 211.3 27.5% (1.36)

RRSat Global Communications Network Ltd. (NasdaqGS:RRST) 3/31/2009 83.5 30.9% 21.0 25.2% 19.2 23.0% 0.80 99.5 26.6 26.7% 0.85

Scripps Networks Interactive, Inc. (NYSE:SNI) 3/31/2009 1,563.5 4.4% 675.1 43.2% 620.0 39.7% 0.10 1,553.2 622.6 40.1% 1.61

SIRIUS XM Radio Inc. (NasdaqGS:SIRI) 3/31/2009 1,980.6 100.4% 129.4 6.5% 53.4 2.7% (2.03) 2,630.5 361.7 13.7% (0.06)

Time Warner Cable Inc. (NYSE:TWC) 3/31/2009 17,404.0 7.0% 6,304.0 36.2% 5,255.0 30.2% (22.56) 18,012.8 6,369.5 35.4% 3.19

Virgin Media, Inc. (NasdaqGS:VMED) 3/31/2009 5,749.6 0.1% 1,854.0 32.2% 1,107.9 19.3% (4.13) 6,328.5 2,139.6 33.8% (1.24)

TELECOM MEDIAN 1,980.6 8.8% 675.1 31.3% 620.0 19.6% (0.27) 2,630.5 622.6 32.1% 0.60

Cinemark Holdings Inc. (NYSE:CNK) 3/31/2009 1,765.3 3.8% 350.3 19.8% 284.1 16.1% (0.33) 1,834.5 389.3 21.2% 0.69

CTC Media, Inc (NasdaqGS:CTCM) 3/31/2009 608.2 20.5% 287.5 47.3% 185.0 30.4% 0.03 517.8 205.2 39.6% 0.80

DreamWorks Animation SKG Inc. (NasdaqGS:DWA) 3/31/2009 756.4 -8.9% 225.5 29.8% 142.8 18.9% 1.99 564.0 - 0.0% 0.93

Liberty Media Capital (NasdaqGS:LCAP.A) 3/31/2009 651.0 29.2% (266.0) -40.9% 52.0 8.0% (6.04) 650.1 (270.7) -41.6% (2.11)

Lions Gate Entertainment Corp. (NYSE:LGF) 12/31/2008 1,514.7 28.3% (77.9) -5.1% 84.5 5.6% (0.89) 1,546.9 15.9 1.0% (0.19)

Live Nation, Inc. (NYSE:LYV) 3/31/2009 4,133.4 9.7% 134.2 3.2% (17.5) -0.4% (4.58) 4,334.9 184.8 4.3% (0.41)

LodgeNet Interactive Corporation (NasdaqGS:LNET) 3/31/2009 522.2 -5.1% 130.1 24.9% 98.9 18.9% (1.33) - - NM -

Marvel Entertainment, Inc. (NYSE:MVL) 3/31/2009 760.6 70.2% 354.2 46.6% 336.0 44.2% 2.60 416.4 200.8 48.2% 1.25

News Corp. (NasdaqGS:NWSA) 3/31/2009 31,342.0 -1.4% 5,207.0 16.6% 2,356.0 7.5% (0.78) 30,107.7 5,018.3 16.7% 0.75

Regal Entertainment Group (NYSE:RGC) 4/2/2009 2,810.7 5.5% 506.1 18.0% 288.1 10.3% 0.43 2,882.8 551.1 19.1% -

RHI Entertainment, Inc. (NasdaqGM:RHIE) 3/31/2009 217.2 -12.2% 17.8 8.2% (58.2) -26.8% (2.13) 239.0 71.3 29.8% -

Time Warner Inc. (NYSE:TWX) 3/31/2009 46,459.0 8.6% 13,169.0 28.3% 10,142.0 21.8% (11.20) 29,400.4 6,694.6 22.8% 2.04

Viacom, Inc. (NYSE:VIA.B) 3/31/2009 14,413.0 4.3% 3,215.0 22.3% 2,095.0 14.5% 1.85 14,163.6 3,150.5 22.2% 2.34

Walt Disney Co. (NYSE:DIS) 3/28/2009 36,367.0 -2.1% 7,585.0 20.9% 4,248.0 11.7% 1.85 36,127.3 8,111.3 22.5% 1.79

Warner Music Group Corp. (NYSE:WMG) 3/31/2009 3,248.0 -6.1% 437.0 13.5% 395.0 12.2% (0.32) 3,117.6 419.4 13.5% (0.33)

World Wrestling Entertainment Inc. (NYSE:WWE) 3/31/2009 471.7 -12.8% 78.5 16.6% 68.5 14.5% 0.49 507.0 95.0 18.7% 0.71

MOVIES & ENTERTAINMENT MEDIAN 8,830.5 -4.1% 1,826.0 18.7% 1,245.0 13.3% 0.08 8,640.6 1,784.9 22.3% 1.25

AirMedia Group Inc. (NasdaqGM:AMCN) 3/31/2009 130.7 141.1% 22.9 17.5% - 0.0% 0.32 185.7 7.2 3.9% (0.15)

Arbitron Inc. (NYSE:ARB) 3/31/2009 373.2 8.7% 71.1 19.1% 42.9 11.5% 1.24 393.8 91.4 23.2% 1.64

Clear Channel Outdoor Holdings Inc. (NYSE:CCO) 3/31/2009 3,095.9 -8.0% 665.0 21.5% 597.4 19.3% (8.52) 2,753.8 487.3 17.7% (0.33)

Focus Media Holding Ltd. (NasdaqGS:FMCN) 12/31/2008 369.6 -27.0% 72.0 19.5% - 0.0% (3.22) 478.7 173.2 36.2% 0.22

Harte-Hanks Inc. (NYSE:HHS) 3/31/2009 1,032.0 -10.1% 141.6 13.7% 112.8 10.9% 0.89 927.8 113.1 12.2% 0.68

Interpublic Group of Companies Inc. (NYSE:IPG) 3/31/2009 6,802.8 1.8% 799.7 11.8% 596.0 8.8% 0.51 6,263.7 695.6 11.1% 0.36

Lamar Advertising Co. (NasdaqGS:LAMR) 3/31/2009 1,162.9 -4.5% 486.1 41.8% 346.2 29.8% (0.10) 1,062.4 416.3 39.2% (0.76)

MDC Partners Inc. (NasdaqGS:MDCA) 3/31/2009 570.5 2.5% 53.5 9.4% 68.5 12.0% 0.39 580.9 66.7 11.5% 0.18

National CineMedia, Inc. (NasdaqGS:NCMI) 4/2/2009 380.3 12.3% 192.0 50.5% 120.2 31.6% 0.42 380.3 192.4 50.6% 0.65

Omnicom Group Inc. (NYSE:OMC) 3/31/2009 12,911.1 -1.1% 1,893.5 14.7% 1,673.4 13.0% 3.06 11,780.5 1,619.9 13.8% 2.57

ValueClick Inc. (NasdaqGS:VCLK) 3/31/2009 591.7 -5.9% 105.5 17.8% 121.7 20.6% (2.51) 544.5 137.5 25.3% 0.63

ADVERTISING MEDIAN 591.7 -1.1% 141.6 17.8% 120.2 12.0% 0.39 580.9 173.2 17.7% 0.36

Median 1,316.0 0.6% 21.8% 147.5 16.8% 1,062.4 22.5%

High 46,459.0 385.3% 73.8% 10,484.0 44.2% 36,127.3 50.6%

Low 59.4 -27.0% -40.9% (58.2) -26.8% - -41.6%


Figure 92. Financial Comparison

Source. Capital IQ

.


Price Performance

Company Name

Current

Price Currency

USD

Market

Cap

3 Mth

Daily Vol 1 Wk 1 Mth 3 Mth 6 Mth 1 Yr

52

Week

High

Belo Corp. (NYSE:BLC) 1.87 USD 191.7 1,115,370 3.3% 0.5% 222.4% -0.5% -78.9% -80.6%

CBS Corporation (NYSE:CBS) 8.92 USD 6,061.0 13,032,340 27.6% 21.7% 165.5% 20.7% -57.5% -60.1%

Central European Media Enterprises Ltd.

(NasdaqGS:CETV) 21.75 USD 1,334.1 618,790 8.4% 4.8% 319.1% 53.4% -78.3% -79.5%

Crown Media Holdings Inc. (NasdaqGM:CRWN) 2.00 USD 209.6 43,180 -34.0% -37.5% 23.5% 1.0% -56.3% -62.6%

Cumulus Media Inc. (NasdaqGS:CMLS) 1.25 USD 52.1 107,930 15.7% 14.7% 16.8% 8.7% -74.7% -76.2%

Discovery Communications, Inc. (NasdaqGS:DISC.A) 22.28 USD 6,266.5 2,023,980 1.2% 4.8% 47.4% 61.6% - -3.1%

Emmis Communications Corp. (NasdaqGS:EMMS) 0.35 USD 12.9 94,500 5.7% -5.4% 16.7% 25.0% -87.3% -89.2%

Entercom Communications Corp. (NYSE:ETM) 1.90 USD 67.0 170,590 0.5% -20.5% 104.3% 75.9% -78.3% -83.5%

Gray Television Inc. (NYSE:GTN) 0.70 USD 34.0 262,650 -5.4% -2.8% 84.2% 62.8% -80.8% -82.6%

Grupo Televisa SA (NYSE:TV) 17.00 USD 9,581.2 3,015,550 -3.2% -0.5% 51.5% 11.5% -33.1% -35.8%

Hearst-Argyle Television Inc. (NYSE:HTV) 4.50 USD 424.1 220,710 -0.2% 0.0% 158.6% -38.4% -79.0% -81.6%

LIN TV Corp. (NYSE:TVL) 2.01 USD 103.3 146,900 -6.5% 28.0% 133.7% 51.1% -75.6% -77.6%

Nexstar Broadcasting Group Inc. (NasdaqGM:NXST) 0.88 USD 25.0 38,410 -2.2% 11.4% 35.4% -1.1% -82.5% -83.4%

Radio One Inc. (NasdaqGM:ROIA.K) 0.36 USD 21.8 274,880 -10.0% -18.2% -12.2% 63.6% -71.0% -79.4%

Sinclair Broadcast Group Inc. (NasdaqGS:SBGI) 2.09 USD 166.3 560,970 14.8% 69.9% 85.0% -41.9% -73.9% -76.9%

BROADCASTING MEDIAN 166.3 262,650 0.5% 0.5% 84.2% 20.7% -77.0% -79.4%

Gannett Co., Inc. (NYSE:GCI) 4.24 USD 985.5 8,731,690 -14.5% -14.0% 92.7% -52.5% -84.6% -85.4%

Interactive Data Corporation (NYSE:IDC) 24.37 USD 2,292.0 259,860 4.0% 11.2% 16.7% 7.7% -9.7% -22.0%

John Wiley & Sons Inc. (NYSE:JW.A) 32.15 USD 1,872.2 213,350 3.2% -4.5% 13.3% 6.5% -33.7% -41.3%

Lee Enterprises Inc. (NYSE:LEE) 0.95 USD 42.7 594,380 -7.8% 10.5% 227.6% 55.7% -83.6% -85.8%

Media General, Inc. (NYSE:MEG) 2.79 USD 63.7 160,460 -10.0% -4.5% 106.7% 77.7% -79.9% -89.7%

Meredith Corp. (NYSE:MDP) 29.41 USD 1,323.4 765,960 8.2% 9.7% 160.7% 76.8% -5.0% -12.4%

Morningstar Inc. (NasdaqGS:MORN) 42.37 USD 2,020.5 225,190 3.4% -2.1% 47.2% 32.4% -39.2% -43.4%

Scholastic Corporation (NasdaqGS:SCHL) 21.02 USD 765.0 311,020 7.9% 4.7% 121.3% 33.0% -29.6% -33.0%

The McClatchy Company (NYSE:MNI) 0.84 USD 70.3 1,074,220 -21.5% 12.0% 23.5% -61.8% -89.2% -90.8%

The McGraw-Hill Companies, Inc. (NYSE:MHP) 30.75 USD 9,670.9 3,390,520 2.0% -3.6% 74.3% 26.9% -29.6% -34.8%

The New York Times Company (NYSE:NYT) 6.45 USD 928.6 1,260,240 -4.3% 4.7% 58.5% -15.6% -60.7% -63.2%

Valassis Communications Inc. (NYSE:VCI) 6.91 USD 332.3 525,210 11.3% 44.6% 439.8% 366.9% -53.4% -58.3%

Washington Post Co. (NYSE:WPO) 354.15 USD 3,329.0 46,440 -3.0% 4.2% 9.8% -12.0% -41.6% -46.9%

PUBLISHING MEDIAN 985.5 525,210 2.0% 4.7% 74.3% 26.9% -41.6% -46.9%

Cablevision Systems Corporation (NYSE:CVC) 18.52 USD 5,591.1 2,439,880 -3.0% 2.7% 78.9% 29.1% -30.2% -43.9%

Comcast Corporation (NasdaqGS:CMCS.A) 14.47 USD 41,722.4 23,472,470 2.0% -11.0% 24.4% -10.5% -34.1% -36.7%

DIRECTV Group, Inc. (NasdaqGS:DTV) 22.16 USD 22,336.6 13,103,460 -4.5% -6.1% 12.6% 0.7% -20.0% -23.8%

Dish Network Corp. (NasdaqGS:DISH) 15.98 USD 7,138.5 4,441,300 -3.4% 6.2% 72.4% 44.9% -54.2% -55.3%

Knology, Inc. (NasdaqGM:KNOL) 8.05 USD 288.4 213,780 0.0% 6.1% 104.8% 50.5% -44.1% -49.3%

Liberty Entertainment Group (NasdaqGS:LMDI.A) 23.40 USD 12,128.5 5,527,630 -4.4% -6.4% 37.2% 115.1% -10.4% -18.3%

Liberty Global Inc. (NasdaqGS:LBTY.A) 13.88 USD 3,800.0 3,248,730 -1.3% -24.2% 33.6% 8.9% -60.4% -62.1%

Mediacom Communications Corp. (NasdaqGS:MCCC) 6.46 USD 434.4 262,660 3.9% 9.7% 85.6% 134.9% 6.3% -23.3%

Outdoor Channel Holdings, Inc. (NasdaqGM:OUTD) 6.99 USD 179.6 65,400 1.7% -6.3% 27.1% 6.2% -12.2% -23.3%

RCN Corp. (NasdaqGS:RCNI) 6.23 USD 227.2 199,700 13.5% 29.8% 72.1% -7.4% -47.1% -55.9%

RRSat Global Communications Network Ltd.

(NasdaqGS:RRST) 11.56 USD 200.1 21,280 12.5% -25.2% 17.2% 18.4% -8.6% -26.3%

Scripps Networks Interactive, Inc. (NYSE:SNI) 28.73 USD 4,721.0 858,300 5.0% -3.9% 51.1% 20.3% - -36.1%

SIRIUS XM Radio Inc. (NasdaqGS:SIRI) 0.35 USD 1,350.0 57,687,020 9.4% -25.5% 141.4% 130.3% -86.4% -87.3%

Time Warner Cable Inc. (NYSE:TWC) 32.32 USD 11,387.5 4,436,850 1.9% -5.2% -40.3% -48.2% -63.6% -65.3%

Virgin Media, Inc. (NasdaqGS:VMED) 8.91 USD 2,930.4 5,079,350 10.1% 13.2% 116.8% 121.1% -44.5% -45.9%

TELECOM MEDIAN 3,800.0 3,248,730 1.9% -5.2% 51.1% 20.3% -39.1% -43.9%

Cinemark Holdings Inc. (NYSE:CNK) 11.21 USD 1,225.0 358,500 5.1% 13.1% 57.4% 42.8% -23.8% -31.2%

CTC Media, Inc (NasdaqGS:CTCM) 11.58 USD 1,762.0 820,350 21.1% 32.5% 300.7% 186.6% -56.5% -58.4%

DreamWorks Animation SKG Inc. (NasdaqGS:DWA) 28.90 USD 2,505.4 1,108,200 6.1% 16.9% 55.7% 27.5% -8.8% -11.7%

Liberty Media Capital (NasdaqGS:LCAP.A) 14.73 USD 1,412.6 896,140 6.3% 5.1% 207.5% 489.2% -2.5% -10.5%

Lions Gate Entertainment Corp. (NYSE:LGF) 5.47 USD 640.2 771,040 -2.3% 9.2% 2.8% -21.6% -44.4% -50.1%

Live Nation, Inc. (NYSE:LYV) 5.49 USD 459.0 1,029,860 -1.4% 1.5% 90.0% 36.2% -58.8% -70.7%

LodgeNet Interactive Corporation (NasdaqGS:LNET) 5.75 USD 129.3 231,780 -2.4% 31.0% 842.6% 1097.9% -11.7% -18.8%

Marvel Entertainment, Inc. (NYSE:MVL) 35.81 USD 2,809.6 968,210 9.5% 8.4% 49.5% 19.6% 4.2% -7.0%

News Corp. (NasdaqGS:NWSA) 10.26 USD 26,839.2 18,092,450 7.8% 13.6% 93.2% 24.2% -40.7% -46.0%

Regal Entertainment Group (NYSE:RGC) 12.10 USD 1,861.5 1,532,920 -0.2% -12.4% 20.0% 15.8% -30.3% -32.2%

RHI Entertainment, Inc. (NasdaqGM:RHIE) 3.14 USD 42.4 96,670 -4.3% -6.5% 38.9% -37.1% - -80.4%

Time Warner Inc. (NYSE:TWX) 24.48 USD 29,289.2 13,308,480 3.9% 0.6% 9.2% -14.2% -46.2% -51.7%

Viacom, Inc. (NYSE:VIA.B) 22.75 USD 13,796.5 4,334,520 2.9% 12.0% 63.4% 53.0% -32.9% -42.5%

Walt Disney Co. (NYSE:DIS) 25.14 USD 46,678.7 16,370,630 4.8% 8.6% 58.8% 10.4% -24.2% -27.9%

Warner Music Group Corp. (NYSE:WMG) 7.23 USD 1,117.7 403,400 10.9% 38.0% 237.9% 161.0% -11.1% -20.1%

World Wrestling Entertainment Inc. (NYSE:WWE) 13.49 USD 983.1 217,430 10.3% 17.6% 41.6% 16.3% -16.4% -21.2%

MOVIES & ENTERTAINMENT MEDIAN 1,587.3 932,175 4.9% 10.6% 58.1% 25.9% -24.2% -31.7%

AirMedia Group Inc. (NasdaqGM:AMCN) 6.49 USD 425.5 132,300 -4.3% -0.2% 53.1% 13.9% -63.0% -65.2%

Arbitron Inc. (NYSE:ARB) 20.60 USD 545.5 346,920 3.3% -1.4% 64.0% 63.4% -59.8% -60.0%

Clear Channel Outdoor Holdings Inc. (NYSE:CCO) 5.14 USD 1,828.2 589,700 49.9% 15.5% 104.0% -14.9% -74.9% -77.1%

Focus Media Holding Ltd. (NasdaqGS:FMCN) 8.58 USD 1,111.1 3,085,970 1.7% 14.6% 44.0% 25.4% -71.4% -78.7%

Harte-Hanks Inc. (NYSE:HHS) 9.19 USD 584.2 311,240 8.0% -4.1% 97.6% 52.2% -30.6% -33.6%

Interpublic Group of Companies Inc. (NYSE:IPG) 5.40 USD 2,583.3 7,018,740 6.7% -8.5% 43.2% 45.9% -43.2% -45.8%

Lamar Advertising Co. (NasdaqGS:LAMR) 18.17 USD 1,665.9 1,774,800 -0.4% 2.4% 225.0% 26.1% -51.9% -55.7%

MDC Partners Inc. (NasdaqGS:MDCA) 5.71 USD 160.2 56,580 7.7% 14.7% 94.9% 99.0% -33.1% -35.0%

National CineMedia, Inc. (NasdaqGS:NCMI) 13.82 USD 582.1 427,960 13.0% -10.3% 15.2% 67.3% -28.2% -32.9%

Omnicom Group Inc. (NYSE:OMC) 32.01 USD 9,950.1 2,981,840 5.0% -1.7% 41.8% 21.2% -29.8% -33.2%

ValueClick Inc. (NasdaqGS:VCLK) 11.48 USD 998.4 1,490,050 8.3% 5.9% 96.6% 67.1% -36.1% -41.4%

ADVERTISING MEDIAN 998.4 589,700 6.7% -0.2% 64.0% 45.9% -43.2% -45.8%

High 46,678.7 57,687,020 49.9% 69.9% 842.6% 1097.9% 6.3% -3.1%

Low 12.9 21,280 -34.0% -37.5% -40.3% -61.8% -89.2% -90.8%

Average 4,296.1 3,262,110 3.1% 4.3% 94.1% 56.3% -45.9% -50.7%

Median 1,111.1 618,790 3.2% 4.2% 63.4% 25.9% -43.6% -46.9%

Figure 93. Price Performance Comparison

Source. Capital IQ


124

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


125

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


Operating Statistics

Company Name

1 Yr

Total

Rev

Growth

1 Yr EBITDA

Growth

1 Yr EBIT

Growth

1 Yr Net

Income

Growth

LTM

Gross

Margin

LTM

EBIT

Margin

LTM

EBITDA

Margin

Est. LT

Growth

Rate

LTM Net

Income

Margin

Total

Debt/Tota

l Capital

Total

Debt/LTM

EBITDA

EBITDA /

Total

Interest

Expense

EBITDA - Cap

Ex /

Total Interest

Expense

Total Debt /

Total Book

Value

Return On

Assets

Return On

Equity

Return On

Capital

Belo Corp. (NYSE:BLC) (10.5%) (15.9%) (18.1%) NM 37.2% 26.4% 32.6% - (44.7%) 78.0% 4.78x 3.01x 2.74x 355.1 5.0% (58.6%) 6.9%

CBS Corporation (NYSE:CBS) (4.4%) (27.9%) (36.4%) NM 36.3% 12.6% 16.7% 4.8% (89.0%) 45.7% 3.16x 4.17x 3.32x 84.2 3.1% (79.5%) 4.8%

Central European Media Enterprises Ltd. (NasdaqGS:CETV 2.6% (20.6%) (35.4%) NM 40.2% 17.1% 27.3% - (33.5%) 59.3% 4.75x 3.44x 2.60x 145.7 3.7% (26.1%) 4.2%

Crown Media Holdings Inc. (NasdaqGM:CRWN) 12.3% 28.3% NM NM 46.9% 23.4% 73.8% - (10.6%) 253.8% 5.20x 2.09x 2.07x NM 5.7% NM 9.9%

Cumulus Media Inc. (NasdaqGS:CMLS) (10.6%) (15.0%) (15.7%) NM 34.0% 22.7% 26.9% (1.0%) (122.7%) 158.5% 8.62x 2.25x 2.13x NM 5.3% NM 6.6%

Discovery Communications, Inc. (NasdaqGS:DISC.A) 385.3% 341.2% 368.0% NM 74.0% 35.7% 40.1% 17.2% 11.6% 39.6% 2.69x 5.63x 5.22x 65.9 9.4% 7.1% 11.1%

Emmis Communications Corp. (NasdaqGS:EMMS) (6.8%) (17.1%) (21.6%) NM 23.0% 13.2% 17.7% 3.0% (82.4%) 71.9% 7.17x 2.31x 1.50x 377.5 2.9% (110.2%) 3.7%

Entercom Communications Corp. (NYSE:ETM) (9.7%) (16.0%) (17.9%) NM 35.4% 25.1% 29.3% 5.0% (123.3%) 88.6% 6.65x 3.10x 2.94x 773.9 4.6% (136.6%) 5.2%

Gray Television Inc. (NYSE:GTN) 2.9% 15.6% 34.1% NM 38.5% 23.0% 33.9% (2.0%) (65.2%) 80.0% 7.41x 2.23x 1.84x 399.9 3.2% (78.6%) 4.1%

Grupo Televisa SA (NYSE:TV) 16.8% 11.6% 7.2% (7.8%) 54.8% 31.1% 40.3% 6.2% 15.5% 45.4% 1.99x 6.63x 4.91x 92.9 8.8% 19.2% 12.5%

Hearst-Argyle Television Inc. (NYSE:HTV) (8.3%) (19.5%) (26.7%) NM 42.3% 18.0% 26.1% (1.0%) (77.7%) 37.1% 4.47x 3.33x 2.74x 58.9 2.3% (32.2%) 3.1%

LIN TV Corp. (NYSE:TVL) (4.0%) (6.5%) (7.5%) NM 69.7% 20.8% 28.8% (1.0%) (211.7%) 130.4% 6.25x 2.14x 1.58x NM 3.5% (326.0%) 4.9%

Nexstar Broadcasting Group Inc. (NasdaqGM:NXST) 3.1% 1.1% (3.9%) NM 71.9% 13.4% 30.9% - (20.5%) 132.2% 7.62x 1.92x 1.07x NM 3.4% NM 4.1%

Radio One Inc. (NasdaqGM:ROIA.K) (4.2%) (25.9%) (36.1%) NM 72.5% 20.1% 26.9% (1.0%) (112.8%) 73.0% 8.26x 1.54x 1.35x 273.3 2.8% (80.5%) 3.3%

Sinclair Broadcast Group Inc. (NasdaqGS:SBGI) (2.3%) (7.9%) (13.3%) NM 64.3% 20.3% 29.4% (1.0%) (47.3%) 112.8% 6.28x 2.89x 2.59x NM 4.7% (741.1%) 6.5%

BROADCASTING MEDIAN (4.0%) (15.0%) (16.8%) (7.8%) 42.3% 20.8% 29.3% - (65.2%) 78.0% 6.25x 2.89x 2.59x 209.5 3.7% (79.0%) 4.9%

Gannett Co., Inc. (NYSE:GCI) (11.2%) (27.7%) (31.1%) NM 41.8% 17.8% 21.8% 3.5% (104.5%) 76.2% 3.05x 7.37x 6.55x 372.8 6.0% (132.4%) 7.7%

Interactive Data Corporation (NYSE:IDC) 6.5% 12.6% 13.7% 7.3% 67.9% 28.0% 34.9% 11.0% 18.8% - - - - - 11.0% 14.3% 13.2%

John Wiley & Sons Inc. (NYSE:JW.A) 0.6% 12.8% 16.2% (0.1%) 68.0% 14.9% 19.4% - 8.1% 67.6% 2.79x 5.95x 4.98x 208.8 6.2% 25.1% 10.3%

Lee Enterprises Inc. (NYSE:LEE) (13.4%) (30.6%) (43.3%) NM 48.4% 9.9% 18.9% - (37.5%) 93.9% 6.77x 2.18x 2.00x 1,547.4 3.0% (163.6%) 3.8%

Media General, Inc. (NYSE:MEG) (12.6%) (30.5%) (50.4%) NM 52.3% 5.0% 13.9% - (82.7%) 84.3% 6.85x 2.59x 1.92x 537.7 1.3% (124.8%) 1.8%

Meredith Corp. (NYSE:MDP) (8.2%) (34.9%) (39.7%) (54.6%) 54.2% 12.0% 15.1% - 5.1% 36.2% 2.04x 10.70x 9.12x 56.8 5.3% 10.0% 8.8%

Morningstar Inc. (NasdaqGS:MORN) 6.2% 10.1% 8.0% 16.3% 74.2% 28.2% 33.8% 15.0% 19.1% - - - - - 12.0% 18.7% 17.2%

Scholastic Corporation (NasdaqGS:SCHL) (10.5%) (49.2%) (58.9%) NM 53.3% 5.2% 7.5% - (2.7%) 32.8% 2.59x 5.34x 3.30x 48.8 3.4% 0.6% 5.0%

The McClatchy Company (NYSE:MNI) (18.5%) (34.5%) (45.7%) NM 45.4% 12.1% 20.1% - (2.3%) 98.4% 5.76x 2.44x 2.31x 6,019.2 3.6% (15.3%) 5.5%

The McGraw-Hill Companies, Inc. (NYSE:MHP) (6.1%) (11.5%) (13.8%) (17.8%) 60.3% 22.3% 25.2% 12.0% 12.4% 51.0% 0.86x 20.18x 19.03x 109.9 14.5% 56.7% 30.3%

The New York Times Company (NYSE:NYT) (11.0%) (34.7%) (40.3%) NM 55.0% 6.5% 11.4% - (4.7%) 73.8% 3.98x 5.88x 3.58x 284.3 3.3% (20.1%) 6.0%

Valassis Communications Inc. (NYSE:VCI) (5.7%) (24.2%) (32.0%) NM 21.7% 5.3% 8.2% 10.0% (8.8%) 98.1% 5.80x 2.11x 1.92x 5,028.5 4.0% (170.2%) 5.8%

Washington Post Co. (NYSE:WPO) 4.6% (24.1%) (50.6%) (97.1%) 54.5% 5.0% 11.9% - 0.2% 12.3% 0.75x 20.41x 9.19x 14.1 2.6% 0.2% 3.9%

PUBLISHING MEDIAN (8.2%) (27.7%) (39.7%) (9.0%) 54.2% 12.0% 18.9% - (2.3%) 67.6% 2.79x 5.34x 3.30x 208.8 4.0% 0.2% 6.0%

Cablevision Systems Corporation (NYSE:CVC) 11.6% 11.0% 21.6% NM 55.2% 16.3% 31.3% 7.3% (2.4%) 178.2% 5.26x 2.97x 1.82x NM 8.1% NM 11.3%

Comcast Corporation (NasdaqGS:CMCS.A) 8.8% 9.9% 18.4% 4.2% 60.6% 20.1% 38.6% 11.6% 7.5% 43.7% 2.39x 5.61x 3.32x 78.0 3.9% 6.3% 6.0%

DIRECTV Group, Inc. (NasdaqGS:DTV) 11.6% 12.6% (2.7%) (9.1%) 49.4% 12.4% 24.7% 12.7% 6.8% 54.6% 1.18x 12.43x 6.90x 128.7 9.7% 24.0% 14.8%

Dish Network Corp. (NasdaqGS:DISH) 3.4% 2.4% 18.5% 11.6% 42.1% 18.2% 19.4% 7.7% 8.2% 148.1% 2.26x 6.23x 3.17x NM 19.1% NM 39.2%

Knology, Inc. (NasdaqGM:KNOL) 8.8% 12.8% 58.3% NM 69.8% 9.0% 31.7% - (2.7%) 109.6% 4.58x 2.92x 1.88x NM 3.6% NM 4.2%

Liberty Entertainment Group (NasdaqGS:LMDI.A) - - - - 30.9% 12.5% 16.0% 61.1% 436.2% 11.9% 8.33x 3.52x 3.52x 13.5 - - -

Liberty Global Inc. (NasdaqGS:LBTY.A) 10.7% 21.1% 49.5% NM 61.3% 14.9% 42.0% - (8.9%) 77.2% 4.35x 4.10x 1.88x 693.1 3.0% (21.5%) 3.7%

Mediacom Communications Corp. (NasdaqGS:MCCC) 7.4% 8.3% 23.3% NM 58.0% 20.3% 36.2% - (1.7%) 115.7% 6.63x 2.48x 1.13x NM 4.9% NM 6.1%

Outdoor Channel Holdings, Inc. (NasdaqGM:OUTD) 26.2% 36,640.0% NM NM 67.4% 7.0% 12.4% - 3.2% - - - - - 1.7% 1.3% 1.8%

RCN Corp. (NasdaqGS:RCNI) 13.0% 45.1% NM NM 64.1% (0.5%) 25.6% - (7.2%) 98.5% 3.86x 3.85x 1.21x 6,789.2 (0.2%) (119.5%) (0.3%)

RRSat Global Communications Network Ltd. (NasdaqGS:R 30.9% 35.9% 35.0% 21.8% 33.1% 19.9% 25.2% 20.9% 16.6% - - - - - 10.0% 18.0% 13.5%

Scripps Networks Interactive, Inc. (NYSE:SNI) 4.4% 1.3% 1.4% NM 65.1% 36.1% 43.2% 9.4% 1.1% - - 77.45x 67.87x - 18.7% 1.5% 23.4%

SIRIUS XM Radio Inc. (NasdaqGS:SIRI) 100.4% NM NM NM 50.2% (6.6%) 6.5% - (265.6%) 92.7% 23.90x 0.67x NM 1,264.6 (1.8%) NM (4.3%)

Time Warner Cable Inc. (NYSE:TWC) 7.0% 7.7% 14.0% NM 52.5% 18.6% 36.2% 10.4% (42.6%) 74.6% 3.67x 5.99x 2.72x 305.5 4.1% (45.6%) 5.7%

Virgin Media, Inc. (NasdaqGS:VMED) 0.1% (0.8%) 124.6% NM 54.5% 2.9% 32.2% - (24.1%) 77.1% 4.79x 2.70x 1.65x 336.5 0.7% (41.6%) 0.9%

TELECOM MEDIAN 8.8% 10.4% 20.0% 4.2% 55.2% 14.9% 31.3% 7.3% (1.7%) 77.1% 3.86x 3.52x 1.88x 128.7 3.9% 0.7% 5.7%

Cinemark Holdings Inc. (NYSE:CNK) 3.8% 0.5% (1.3%) NM 35.4% 11.0% 19.8% 13.0% (2.0%) 66.8% 4.73x 3.20x 2.30x 204.7 3.8% (4.0%) 4.7%

CTC Media, Inc (NasdaqGS:CTCM) 20.5% 16.0% 21.0% (97.3%) 94.4% 43.3% 47.3% 46.4% 0.7% 15.4% 0.32x 24.82x 24.44x 18.2 20.1% 0.7% 24.8%

DreamWorks Animation SKG Inc. (NasdaqGS:DWA) (8.9%) (28.3%) (28.6%) (22.0%) 43.8% 29.3% 29.8% 8.2% 23.6% 6.2% 0.31x - - 6.6 10.8% 17.6% 12.8%

Liberty Media Capital (NasdaqGS:LCAP.A) 29.2% NM NM NM 18.0% (55.5%) (40.9%) - (88.9%) 83.5% NM NM NM 505.6 (2.2%) (39.2%) (3.9%)

Lions Gate Entertainment Corp. (NYSE:LGF) 28.3% NM NM NM 46.0% (5.6%) (5.1%) 27.1% (6.9%) 96.5% NM NM NM 2,775.6 (3.8%) (129.1%) (13.0%)

Live Nation, Inc. (NYSE:LYV) 9.7% 55.6% NM NM 24.7% (0.1%) 3.2% - (7.2%) 53.9% 5.96x 2.15x NM 137.6 (0.1%) (49.6%) (0.1%)

LodgeNet Interactive Corporation (NasdaqGS:LNET) (5.1%) (3.6%) 165.1% NM 35.0% 3.6% 24.9% - (5.6%) 127.3% 4.32x 3.14x 1.91x NM 1.9% NM 2.4%

Marvel Entertainment, Inc. (NYSE:MVL) 70.2% 45.2% 47.1% 48.2% 65.4% 46.5% 46.6% 13.6% 26.9% 12.7% 0.17x 18.11x 17.96x 14.6 24.8% 63.8% 42.5%

News Corp. (NasdaqGS:NWSA) (1.4%) (18.0%) (22.8%) NM 37.1% 12.6% 16.6% 10.4% (6.5%) 38.1% 2.74x 5.70x 4.35x 63.5 4.3% (8.2%) 6.2%

Regal Entertainment Group (NYSE:RGC) 5.5% (0.7%) (8.0%) (58.9%) 60.4% 10.7% 18.0% 12.3% 2.4% 114.1% 3.95x 3.69x 2.71x NM 7.2% NM 10.3%

RHI Entertainment, Inc. (NasdaqGM:RHIE) (12.2%) (63.9%) (65.8%) NM 31.2% 7.5% 8.2% - (23.4%) 78.5% 32.46x 0.49x 0.49x 632.8 1.1% (63.2%) 1.4%

Time Warner Inc. (NYSE:TWX) 8.6% 11.8% 6.3% NM 41.9% 18.5% 28.3% 11.1% (29.1%) 32.4% 1.33x 5.45x 3.65x 48.9 5.3% (28.3%) 7.0%

Viacom, Inc. (NYSE:VIA.B) 4.3% (7.4%) (7.5%) (39.2%) 53.2% 19.8% 22.3% 10.3% 8.0% 51.1% 2.29x 6.46x 6.03x 104.7 8.2% 16.2% 11.8%

Walt Disney Co. (NYSE:DIS) (2.1%) (16.3%) (20.6%) (21.1%) 16.4% 16.4% 20.9% 10.5% 9.6% 30.0% 1.94x 12.08x 9.31x 44.3 6.0% 10.9% 7.7%

Warner Music Group Corp. (NYSE:WMG) (6.1%) (5.6%) (14.8%) NM 47.8% 5.3% 13.5% 4.0% (1.5%) 105.2% 5.08x 2.57x 2.45x NM 2.5% NM 5.0%

World Wrestling Entertainment Inc. (NYSE:WWE) (12.8%) (21.6%) (29.3%) (35.9%) 43.5% 13.6% 16.6% 10.6% 7.7% 1.3% 0.06x 194.67x 149.81x 1.3 8.7% 9.8% 10.7%

MOVIES & ENTERTAINMENT MEDIAN 4.1% (4.6%) (8.0%) (35.9%) 42.7% 11.8% 18.9% 10.5% (1.8%) 52.5% 2.52x 4.57x 3.65x 63.5 4.8% (4.0%) 6.6%

AirMedia Group Inc. (NasdaqGM:AMCN) 141.1% NM NM 7,245.8% 33.3% 12.5% 17.5% 39.8% 16.6% - - - - - 3.4% 7.7% 3.6%

Arbitron Inc. (NYSE:ARB) 8.7% (5.6%) (14.9%) (18.8%) 48.9% 14.0% 19.1% 14.5% 8.9% 104.0% 1.10x 30.25x 16.30x NM 18.0% 444.1% 47.4%

Clear Channel Outdoor Holdings Inc. (NYSE:CCO) (8.0%) (28.7%) (62.6%) NM 42.3% 6.3% 21.5% 5.0% (97.8%) 43.4% 3.91x 4.01x 2.07x 81.5 1.8% (113.3%) 2.2%

Focus Media Holding Ltd. (NasdaqGS:FMCN) (27.0%) (61.7%) (98.3%) NM 26.6% 0.7% 19.5% 14.4% (207.9%) - - - - - 0.1% (27.2%) 0.1%

Harte-Hanks Inc. (NYSE:HHS) (10.1%) (26.4%) (32.4%) (34.5%) 21.0% 10.2% 13.7% 4.0% 5.5% 42.3% 1.86x 10.96x 9.77x 73.2 7.2% 16.0% 10.2%

Interpublic Group of Companies Inc. (NYSE:IPG) 1.8% 29.5% 42.5% 26.1% 37.9% 9.2% 11.8% 10.0% 4.3% 46.5% 2.64x 4.23x 3.61x 99.6 3.5% 13.1% 8.7%

Lamar Advertising Co. (NasdaqGS:LAMR) (4.5%) (10.6%) (37.9%) NM 62.8% 12.2% 41.8% 4.0% (0.7%) 77.7% 6.14x 3.20x 2.16x 349.4 2.1% (1.0%) 2.3%

MDC Partners Inc. (NasdaqGS:MDCA) 2.5% (3.4%) (5.2%) NM 33.0% 3.7% 9.4% 15.0% 0.6% 56.2% 3.54x 3.61x 2.86x 211.7 2.5% 10.1% 4.0%

National CineMedia, Inc. (NasdaqGS:NCMI) 12.3% 10.6% 6.5% (25.2%) 69.6% 46.8% 50.5% 13.3% 4.6% 276.0% 4.20x 3.08x 2.85x NM 20.3% NM 42.8%

Omnicom Group Inc. (NYSE:OMC) (1.1%) (1.0%) (2.1%) (4.5%) 26.0% 12.8% 14.7% 9.4% 7.4% 42.6% 1.46x 15.03x 13.49x 83.0 6.1% 26.0% 14.9%

ValueClick Inc. (NasdaqGS:VCLK) (5.9%) (30.2%) (39.9%) NM 66.8% 11.5% 17.8% 16.1% (37.2%) - - - - - 5.9% (42.1%) 8.0%

ADVERTISING MEDIAN (1.1%) (8.1%) (23.7%) (11.7%) 37.9% 11.5% 17.8% 13.3% 4.3% 43.4% 1.86x 3.61x 2.85x 81.5 3.5% 8.9% 8.0%

Median 1.8% (5.6%) (13.3%) (9.0%) 48.4% 13.2% 21.8% 5.0% (2.3%) 67.6% 3.67x 3.44x 2.71x 104.7 3.9% (4.0%) 6.0%

Average 10.2% 514.9% (1.5%) 225.9% 48.6% 14.5% 23.6% 7.7% (20.3%) 68.4% 4.19x 8.76x 6.93x 534.6 5.6% (35.9%) 8.6%

High 385.3% 36,640.0% 368.0% 7,245.8% 94.4% 46.8% 73.8% 61.1% 436.2% 276.0% 32.46x 194.67x 149.81x 6,789.2 24.8% 444.1% 47.4%

Low (27.0%) (63.9%) (98.3%) (97.3%) 16.4% (55.5%) (40.9%) (2.0%) (265.6%) - - - - - (3.8%) (741.1%) (13.0%)

Figure 94. Operating Statistics Comparison

Source. Capital IQ

APPENDIX 3

P R I C E C H A R T S


126

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

Broadcasting

0

20

40

60

80

100

120

06

/04

/08

06

/17

/08

06

/30

/08

07

/11

/08

07

/24

/08

08

/06

/08

08

/19

/08

09

/01

/08

09

/12

/08

09

/25

/08

10

/08

/08

10

/21

/08

11

/03

/08

11

/14

/08

11

/27

/08

12

/10

/08

12

/23

/08

01

/07

/09

01

/20

/09

02

/02

/09

02

/13

/09

02

/26

/09

03

/11

/09

03

/24

/09

04

/06

/09

04

/20

/09

05

/01

/09

05

/14

/09

05

/27

/09

Index: US Broadcasting (Market Cap Weights) Index: Cdn Broadcasting (Market Cap Weights)

Figure 96. U.S. Broadcasting Index, Canadian Broadcasting Index

Source. Capital IQ

Publishing

0

20

40

60

80

100

120

06

/04

/08

06

/18

/08

07

/02

/08

07

/16

/08

07

/30

/08

08

/13

/08

08

/27

/08

09

/10

/08

09

/24

/08

10

/08

/08

10

/22

/08

11

/05

/08

11

/19

/08

12

/03

/08

12

/17

/08

01

/02

/09

01

/16

/09

01

/30

/09

02

/13

/09

02

/27

/09

03

/13

/09

03

/27

/09

04

/13

/09

04

/27

/09

05

/11

/09

05

/25

/09

Index: US Publishing (Market Cap Weights) Index: Cdn Publishing (Market Cap Weights)

Figure 95. U.S. Publishing Index, Canadian Publishing Index

Source. Capital IQ


127

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

Movies & Entertainment

0

20

40

60

80

100

120

06

/04

/08

06

/18

/08

07

/02

/08

07

/16

/08

07

/30

/08

08

/13

/08

08

/27

/08

09

/10

/08

09

/24

/08

10

/08

/08

10

/22

/08

11

/05

/08

11

/19

/08

12

/03

/08

12

/17

/08

01

/02

/09

01

/16

/09

01

/30

/09

02

/13

/09

02

/27

/09

03

/13

/09

03

/27

/09

04

/13

/09

04

/27

/09

05

/11

/09

05

/25

/09

Index: US Movies & Entertainment (Market Cap Weights) Index: Cdn Movie & Entertainment (Market Cap Weights)

Figure 98. U.S. Movies & Entertainment Index, Canadian Movies &

Entertainment Index

Source. Capital IQ

Cable & Satellite

0

20

40 60

80

100

120

06

/04

/08

06

/18

/08

07

/02

/08

07

/16

/08

07

/30

/08

08

/13

/08

08

/27

/08

09

/10

/08

09

/24

/08

10

/08

/08

10

/22

/08

11

/05

/08

11

/19

/08

12

/03

/08

12

/17

/08

01

/02

/09

01

/16

/09

01

/30

/09

02

/13

/09

02

/27

/09

03

/13

/09

03

/27

/09

04

/13

/09

04

/27

/09

05

/11

/09

05

/25

/09

Index: US Cable & Sat (Market Cap Weights) Index: Cdn Cable & Sat (Market Cap Weights)

Figure 97. U.S. Cable & Satellite Index, Canadian Cable & Satellite Index

Source. Capital IQ

Advertising

0

20

40

60

80

100

120

06

/04

/08

06

/18

/08

07

/02

/08

07

/16

/08

07

/30

/08

08

/13

/08

08

/27

/08

09

/10

/08

09

/24

/08

10

/08

/08

10

/22

/08

11

/05

/08

11

/19

/08

12

/03

/08

12

/17

/08

01

/02

/09

01

/16

/09

01

/30

/09

02

/13

/09

02

/27

/09

03

/13

/09

03

/27

/09

04

/13

/09

04

/27

/09

05

/11

/09

05

/25

/09

Index: US Advertising (Market Cap Weights) Index: Cdn Advertising (Market Cap Weights)

Figure 99. U.S. Advertising Index, Canadian Advertising Index

Source. Capital IQ


128

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

FIGURE 1. MEDIA MARKET SHARE, 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6

FIGURE 2. REVENUE BY SEGMENT, 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6

FIGURE 3. CANADIAN INTERNET SUBSCRIBERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

FIGURE 4. AVERAGE WEEKLY HOURS SPENT ONLINE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

FIGURE 5. HIGH DEBT LEVELS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8

FIGURE 6. ONE-YEAR PRICE PERFORMANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8

FIGURE 7. LAYOFFS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9

FIGURE 8. MEDIA ACCESS/CREATION CHANGING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

FIGURE 9. U.S. USER-GENERATED CONTENT CREATORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

FIGURE 10. ACTIVITIES PARTICIPATED WHILE ONLINE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

FIGURE 11. GLOBAL ADVERTISING EXPENDITURE, BY MEDIUM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

FIGURE 12. CANADIAN ADVERTISING REVENUE, BY MEDIUM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

FIGURE 13. CANADIAN ONLINE ADVERTISING REVENUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

FIGURE 14. ONLINE ADVERTISING REVENUE, BY SEGMENT (2007). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

FIGURE 15. WEB CPM’S DROP. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

FIGURE 16. SOCIAL NETWORK ADVERTISING SPENDING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

FIGURE 17. INTERNET PROPERTIES USAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

FIGURE 18. COMMERCIAL TV REVENUE MARKET SHARE, 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

FIGURE 19. NATIONAL TV CONSUMPTION, BY AGE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

FIGURE 20. TIME SPENT WATCHING VIDEO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

FIGURE 21. TELEVISION REVENUE, BY TYPE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

FIGURE 22.TELEVISION REVENUE GROWTH, BY TYPE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

FIGURE 23. COMMERCIAL RADIO REVENUE MARKET SHARE, 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

FIGURE 24. WEEKLY HOURS OF RADIO, BY AGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

FIGURE 25. RADIO REVENUE, BY SEGMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

FIGURE 26. NEWSPAPER MARKET SHARE, BY CIRCULATION, 2007. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

FIGURE 27. CANADIAN DAILY NEWSPAPER REVENUE, BY TYPE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

FIGURE 28. ONLINE NEWSPAPER ADVERTISING REVENUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

FIGURE 29. U.S. NEWSPAPER ADVERTISING REVENUE, BY TYPE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

FIGURE 30. U.S. NEWSPAPER UNIQUE VISITORS/PAGE VIEWS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

FIGURE 31. CRAIGSLIST OUTRANKS NY TIMES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

FIGURE 32. REVENUE RANKING, Q4/08 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

FIGURE 33. MEDIA REVENUE, BY QUARTER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

FIGURE 34. REVENUE GROWTH RANKING, Q4/08 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

FIGURE35. EBITDA MARGIN RANKING, Q4/08. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

FIGURE 36. NET CASH RANKING, Q4/08 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

FIGURE 37. OPERATING CASH FLOW RANKING, Q4/08. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

L I S T O F

FIGURES


129

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

FIGURE 38. MEDIA UNIVERSE CASH AND OPERATING CASH FLOW, BY QUARTER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

FIGURE 39. MEDIA UNIVERSE FINANCIAL METRIC RANKING, Q4/08. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

FIGURE 40. MEDIA UNIVERSE FINANCIAL METRIC RANKING, HISTORICAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

FIGURE 41. COVERAGE UNIVERSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

FIGURE 42. CORUS SEGMENTED REVENUE, BY QUARTER/ANNUAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

FIGURE 43. CORUS EBITDA, NET INCOME, AND EPS, BY QUARTER/ANNUAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

FIGURE 44. CORUS CASH AND CASH FLOW, BY QUARTER/ANNUAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

FIGURE 45. CORUS NET DEBT AND DEBT RATIOS, BY QUARTER/ANNUAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

FIGURE 46. FINANCIAL METRIC RANKING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

FIGURE 47. CORUS ESTIMATE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

FIGURE 48. CORUS EV/REVENUE (TRAILING) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

FIGURE 49. CORUS EV/EBITDA (TRAILING) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

FIGURE 50. RELATIVE EV/EBITDA VALUATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

FIGURE 51. CORUS NET ASSET VALUATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

FIGURE 52. U.S. COMPARABLES VALUATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

FIGURE 53. CANADIAN COMPARABLES VALUATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

FIGURE 54. CJR.B RELATIVE PRICE PERFORMANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

FIGURE 55. GLOBAL ADVERTISING EXPENDITURE, BY MEDIUM & GLOBAL ADVERTISING EXPENDITURE, ANNUAL GROWTH. . . . . . . . . . . . . . . . . . . . . . . . . . 45

FIGURE 56. CYBERPLEX SEGMENTED REVENUE, BY QUARTER/ANNUAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

FIGURE 57. CYBERPLEX EBITDA, NET INCOME, AND EPS, BY QUARTER/ANNUAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

FIGURE 58. CYBERPLEX CASH AND CASH FLOW, BY QUARTER/ANNUAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48


FIGURE 60. CYBERPLEX ESTIMATE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

FIGURE 61. WEB CPM’S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

FIGURE 62. CYBERPLEX EV/REVENUE (TRAILING) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

FIGURE 63. CYBERPLEX EV/REVENUE (TRAILING) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51



FIGURE 66. CX RELATIVE PRICE PERFORMANCE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53

FIGURE 67. QUEBECOR CORPORATE STRUCTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

FIGURE 68. QUEBECOR SEGMENTED REVENUE, BY QUARTER. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58

FIGURE 69. QUEBECOR SEGMENTED REVENUE, ANNUAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58

FIGURE 70. QUEBECOR EBITDA, BY QUARTER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59

FIGURE 71. QUEBECOR CASH AND CASH FLOW, BY QUARTER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59

FIGURE 72. QUEBECOR DEBT MATURITY, ANNUAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60

FIGURE 73. QUEBECOR NET INCOME AND EPS, ANNUAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60



FIGURE 75. QUEBECOR ESTIMATE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62

FIGURE 76. QUEBECOR EV/REVENUE (TRAILING) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64

FIGURE 77. QUEBECOR EV/EBITDA (TRAILING) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64

FIGURE 78. RELATIVE EV/EBITDA VALUATION – TELECOM GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65

FIGURE 79. RELATIVE EV/EBITDA VALUATION – BROADCASTING GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65

FIGURE 80. RELATIVE EV/EBITDA VALUATION – PUBLISHING GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66

FIGURE 81. QUEBECOR NET ASSET VALUATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66



FIGURE 84. CJR.B RELATIVE PRICE PERFORMANCE – TELECOM GROUP. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68

FIGURE 85. CJR.B RELATIVE PRICE PERFORMANCE – BROADCASTING GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69

FIGURE 86. CJR.B RELATIVE PRICE PERFORMANCE – PUBLISHING GROUP. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69

FIGURE 87. VALUATION COMPARISON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118

FIGURE 88. FINANCIAL COMPARISON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119

FIGURE 89. PRICE PERFORMANCE COMPARISON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120

FIGURE 90. OPERATING STATISTICS COMPARISON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121

FIGURE 91. VALUATION COMPARISON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122

FIGURE 92. FINANCIAL COMPARISON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123

FIGURE 93. PRICE PERFORMANCE COMPARISON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124

FIGURE 94. OPERATING STATISTICS COMPARISON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125

FIGURE 95. U.S. PUBLISHING INDEX, CANADIAN PUBLISHING INDEX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126

FIGURE 96.U.S. BROADCASTING INDEX, CANADIAN BROADCASTING INDEX. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126

FIGURE 97.U.S. CABLE & SATELLITE INDEX, CANADIAN CABLE & SATELLITE INDEX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127

FIGURE 98. U.S. MOVIES & ENTERTAINMENT INDEX, CANADIAN MOVIES & ENTERTAINMENT INDEX. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127

FIGURE 99. U.S. ADVERTISING INDEX, CANADIAN ADVERTISING INDEX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127

130

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


IMPORTANT DISCLOSURES:

This report was prepared by David Shore, Analyst and Arun Thomas, Associate. At the date of release of this report David Shore,

owns no common shares of Corus Entertainment Inc, Cyberplex Inc. or Quebecor Inc..

From October 2008 to June 2009 David Shore made several visits to Cyberplex (Toronto), one visit to Corus Entertainment Inc.

(Toronto) and one visit to Quebecor Inc. (Montreal) at the expense of Research Capital.

A percentage of Research Capital Corporation's total investment banking revenues is allocated to a pool from which all of

it's analysts receive a portion of their compensation. Analysts are not compensated based upon any specific investment

banking transaction.

Research Capital Corporation is the Toronto Stock Exchange market maker for shares of Corus Entertainment Inc.

A N A L Y S T C E R T I F I C A T I O N

I, David Shore, certify the views expressed in this report were formed by my review of relevant company data and industry

investigation, and accurately reflect my opinion about the investment merits of the securities mentioned in the report. I also certify

that my compensation is not related to specific recommendations or views expressed in this report.

Research Capital Corporation publishes research and investment recommendations for the use of its clients. Information regarding

our categories of recommendations, quarterly summaries of the percentage of our recommendations which fall into each category

and our policies regarding the release of our research reports is available at www.researchcapital.com or may be requested by

contacting the analyst.

The information contained in this report has been drawn from sources believed to be reliable but its accuracy or completeness is not

guaranteed, nor in providing it does Research Capital Corporation assume any responsibility or liability. Research Capital Corporation, its

directors, officers and other employees may, from time to time, have positions in the securities mentioned herein. Contents of this report

cannot be reproduced in whole or in part without the express permission of Research Capital Corporation. (U.S. Institutional Clients —

Research Capital USA Inc., a wholly owned subsidiary of Research Capital Corporation, accepts responsibility for the contents of this report

subject to the terms & limitations set out above. U.S. firms or institutions receiving this report should effect transactions in securities discussed

in the report through Research Capital USA Inc., a Broker Dealer registered with the United States Securities Exchange Commission.)

131

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT

132

WW

W.

RE

SE

AR

CH

CA

PI

TA

L.

CO

MR

ES

EA

RC

H

RE

PO

RT


R E S E A R C H C A P I T A L

INSTITUTIONAL EQUITY DEPARTMENT

R E S E A R C H

T O R O N T O

Barry Allan 416.860.7612 MINING

John McClintock, Associate 416.860.7613

Nick Agostino, CFA 416.860.6790 TECHNOLOGY COMMUNICATIONS & EQUIPMENT

Robert Cavallo 416.860.7618 CONSUMER PRODUCTS & RETAIL

John Chu, CFA 416.860.8636 INDUSTRIAL PRODUCTS & AGRICULTURE

Matt Gowing, CFA 416.860.8675 ALTERNATIVE ENERGY

Jacques Kavafian 416.860.7797 AIRLINES & AEROSPACE

Susan Cheng, Associate 416.860.7648

David Shore, CFA 416.860.6784 TECHNOLOGY SOFTWARE

Arun Thomas, Associate 416.860.7666

Tom Akin, CMT 416.8607650 TECHNICAL/QUANTITATIVE

C A L G A R Y

Bill Newman, CFA 403.750.1297 OIL & GAS

Ken Lin, CFA 403.750.1284 OIL & GAS

Daniel Choi, Associate 403.750.4232

T R A D I N G

T O R O N T O

David Foley 416.860.7745

Carrie Phillips 416.860.7665

John Metcalfe 416.860.7774

Terry Sugrue 416.860.7747

Mike Tintinaglia, CFA 416.860.8681

Asha Khosla, Assistant 416.860.7655

M O N T R E A L

Pierre Gendron 514.399.1522

Elizabeth Johnston, Assistant 514.399.1524

S A L E S

T O R O N T O

Kristine Sonnenberg 416.860.7635

Pace Goldman 416.860.7651

Mike House 416.860.7753

Jonathan Samahin, CFA 416.860.7755

Ewelina Sobala, Assistant 416.860.6780

1.800.661.7426

M O N T R E A L

Mark Shannon 514.399.1521

C A L G A R Y

Megan Miller 403.750.4234

P R O D U C T I O N

Sharon Mendelaoui, Production Manager and Research Coordinator 416.860.7654

Documents

Don't Change the Channel: TV the Brightest Spot in the Canadian Media Sector