Postmedia Reports Third Quarter Results

TORONTO--(BUSINESS WIRE)--Postmedia Network Canada Corp. (“Postmedia” or the “Company”) today released financial information for the three and nine months ended May 31, 2026.

“The third quarter results reflect continued momentum in our diversified revenue streams, supported by the contribution of the recently acquired accelerate360 Canada business and ongoing growth in parcel delivery,” said Andrew MacLeod, President and Chief Executive Officer of Postmedia. “At the same time, the continued evolution of advertising and circulation revenue reinforces the importance of taking a proactive and disciplined approach as we adapt to the changes reshaping the broader media industry.”

“We remain focused on integrating new capabilities across the business, managing costs responsibly and advancing our strategy to build a more diversified and sustainable Postmedia. This includes our ongoing digital transformation, with a revitalized digital platform beginning to roll out across our network to strengthen the reader experience, deepen audience engagement and better connect communities with the journalism that matters to them.”

Third Quarter Operating Results

Revenue for the quarter was $146.7 million as compared to $109.2 million in the same period in the prior year, representing an increase of $37.5 million (34.4%). The revenue increase was primarily due to increases in product distribution revenue of $41.2 million, other revenue of $2.3 million (40.7%) and parcel revenue of $2.1 million (16.4%), partially offset by decreases in advertising revenue of $6.4 million (11.6%) and circulation revenue of $1.7 million (4.8%).

Total operating expenses excluding depreciation, amortization, restructuring and other increased $40.3 million, or 38.8%, for the quarter ended May 31, 2026, relative to the same period in the prior year. The increase relates entirely to the acquisition of accelerate360 Canada, which added $44.4 million in expenses during the quarter. Excluding the acquisition, expenses were down $4.1 million.

Operating income before depreciation, amortization and restructuring and other in the quarter ended May 31, 2026 was $2.6 million, a decrease of $2.8 million relative to the same period in the prior year. The decrease is due to an increase in operating expenses excluding depreciation, amortization, restructuring and other, partially offset by an increase in total revenue.

Net loss in the quarter ended May 31, 2026 was $35.4 million, as compared to a net income of $7.9 million in the same period in the prior year. The increase in net loss was primarily the result of a decrease in operating income before depreciation, amortization, restructuring and other, an increase in foreign currency exchange losses, depreciation, restructuring and other, and interest expense.

Year to Date Operating Results

Revenue for the nine months ended May 31, 2026 was $368.5 million as compared to $330.3 million in the same period in the prior year, representing an increase of $38.2 million (11.6%). The revenue increase was primarily due to increases in product distribution revenue of $41.2 million, parcel revenue of $9.1 million (23.1%), and other revenue of $5.6 million (25.0%), partially offset by decreases in advertising revenue of $11.2 million (7.0%) and circulation revenue of $6.4 million (6.0%).

Total operating expenses excluding depreciation, amortization, impairment and restructuring and other increased $40.5 million, or 13.1%, for the nine months ended May 31, 2026, relative to the same period in the prior year. The increase relates entirely to the acquisition of accelerate360 Canada, which added $44.4 million in expenses to the quarter. Excluding the acquisition, expenses were down $3.9 million.

Operating income before depreciation, amortization, impairment and restructuring and other for the nine months ended May 31, 2026 was $18.4 million, a decrease of $2.2 million relative to the same period in the prior year. The decrease in operating income before depreciation, amortization, impairment and restructuring and other is due to an increase in operating expenses excluding depreciation, amortization, impairment and restructuring and other, partially offset by an increase in total revenue.

Net loss in the nine months ended May 31, 2026 was $52.3 million, as compared to a net loss of $32.6 million in the same period in the prior year. The increase in net loss was primarily the result of an increase in depreciation, restructuring and other, interest expense, loss on disposal of right of use assets and assets held-for-sale, and a decrease in operating income before depreciation, amortization, impairment and restructuring and other, partially offset by a decrease in foreign current exchange losses.

Acquisition of accelerate360 Canada Inc.

On March 2, 2026, the Company completed the purchase (the “Accelerate360 Purchase Transaction”) of all issued and outstanding shares of accelerate360 Canada Inc., pursuant to the Share Purchase Agreement dated February 19, 2026 (“SPA”). The closing date of the acquisition of accelerate360 Canada was March 2, 2026 (“Closing Date”). The Company intends to continue accelerate360 Canada’s wholesale distribution and merchandising operations across Canada in furtherance of the Company’s commitment to logistics excellence. The purchase price of accelerate360 Canada includes cash consideration of $2 million, subject to a working capital adjustment and an earnout payment of up to a maximum of $2 million if certain targets are met over a two-year period.

Additional Information

Additional information, including financial statements and management’s discussion and analysis can be found on the Company’s website at www.postmedia.com or on SEDAR+ at www.sedarplus.ca.

Note: All dollar amounts are expressed in Canadian dollars unless otherwise specified.

About Postmedia Network Canada Corp.

Postmedia Network Canada Corp. (TSX:PNC.A, PNC.B) is the holding company that owns Postmedia Network Inc., a Canadian newsmedia company representing more than 130 brands across multiple print and digital platforms. Award-winning journalists and innovative product development teams bring engaging content to millions of people every week whenever and wherever they want it. This exceptional content, reach and scope offers advertisers and marketers compelling solutions to effectively reach target audiences. Our expertise in home delivery and expanding distribution network powers Postmedia Parcel Services. For more information, visit www.postmedia.com, www.postmediasolutions.com and www.postmediaparcelservices.com.

Forward-Looking Information

This news release may include information that is “forward-looking information” under applicable Canadian securities laws. The Company has tried, where possible, to identify such information and statements by using words such as “believe,” “expect,” “intend,” “estimate,” “anticipate,” “may,” “will,” “could,” “would,” “should” and similar expressions and derivations thereof in connection with any discussion of future events, trends or prospects or future operating or financial performance. Forward-looking statements in this news release include statements with respect the implementation and results of the Company’s transformation initiatives, continued benefits of historical results into future periods, the realization of anticipated cost savings, the identification and undertaking of ongoing cost savings initiatives. By their nature, forward-looking information and statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. These risks and uncertainties include, among others: competition from digital and other forms of media; the effect of economic conditions on advertising revenue; the ability of the Company to build out its digital media and online businesses; the failure to maintain current print and online newspaper readership and circulation levels; the realization of anticipated cost savings; possible damage to the reputation of the Company’s brands or trademarks; possible labour disruptions; possible environmental liabilities, litigation and pension plan obligations; fluctuations in foreign exchange rates and the prices of newsprint and other commodities.

For a complete list of our risk factors please refer to the section entitled “Risk Factors” contained in our annual management’s discussion and analysis for the years ended August 31, 2025 and 2024. Although the Company bases such information and statements on assumptions believed to be reasonable when made, they are not guarantees of future performance and actual results of operations, financial condition and liquidity, and developments in the industry in which the Company operates, may differ materially from any such information and statements in this press release. Given these risks and uncertainties, undue reliance should not be placed on any forward-looking information or forward-looking statements, which speak only as of the date of such information or statements. Other than as required by law, the Company does not undertake, and specifically declines, any obligation to update such information or statements or to publicly announce the results of any revisions to any such information or statements.

Postmedia Network Canada Corp. Consolidated Statements of Operations (UNAUDITED)
(In thousands of Canadian dollars, except per share amounts)	For the three months ended		For the nine months ended
	May 31, 2026	May 31, 2025	May 31, 2026	May 31, 2025
Revenues
Advertising	48,596	54,962	150,252	161,478
Circulation	34,121	35,826	100,375	106,812
Parcel services	14,863	12,764	48,814	39,669
Product distribution	41,194	-	41,194	-
Other	7,896	5,610	27,862	22,293
Total revenues	146,670	109,162	368,497	330,252
Expenses
Product cost of sales	33,612	-	33,612	-
Compensation	39,961	35,052	108,419	104,848
Newsprint	2,099	2,769	7,000	8,153
Distribution	39,898	36,179	116,910	110,696
Production	10,106	13,089	31,700	34,121
Other operating	18,437	16,754	52,495	51,857
Operating income before depreciation, amortization, impairment and restructuring and other	2,557	5,319	18,361	20,577
Depreciation	10,868	3,163	17,118	9,803
Amortization	853	577	1,983	1,687
Impairment	-	-	1,755	1,501
Restructuring and other	9,950	1,016	12,280	4,517
Operating (loss) income	(19,114)	563	(14,775)	3,069
Interest expense	11,617	10,703	34,231	31,930
Foreign currency exchange losses (gains)	4,206	(18,191)	1,679	5,716
Net financing expense relating to employee benefit plans	262	289	787	866
Loss (gain) on disposal of right of use assets and assets held for sale	-	119	23	(2,707)
Loss (gain) on derivative financial instruments and financial assets at fair value through profit and loss	156	(262)	766	(169)
Net (loss) income after income taxes	(35,355)	7,905	(52,261)	(32,567)
(Loss) earnings per share
Basic and diluted	($0.36)	$0.08	$(0.53)	$(0.33)

Postmedia Network Canada Corp. Consolidated Statements of Financial Position (UNAUDITED)
(In thousands of Canadian dollars)	As at May 31, 2026	As at August 31, 2025
Assets
Current Assets
Cash	7,465	3,278
Trade and other receivables	59,226	59,169
Assets held-for-sale	4,263	-
Inventory	49,156	1,615
Prepaid expenses and other assets	7,211	6,449
Total current assets	127,321	70,511
Non-Current Assets
Property and equipment	6,789	22,986
Intangible assets	20,164	15,313
Right of use assets	18,324	14,543
Derivative financial instruments and other assets	4,892	4,672
Total assets	177,490	128,025
Liabilities and Deficiency
Current Liabilities
Accounts payable and accrued liabilities	116,904	53,312
Provisions	10,576	1,253
Contract liabilities	19,843	16,127
Current portion of lease obligations	10,335	7,742
Total current liabilities	157,658	78,434
Non-Current Liabilities
Long-term debt	408,785	388,964
Employee benefit obligations	28,186	30,084
Lease obligations	13,659	12,775
Other long-term liabilities	18,191	16,753
Total liabilities	626,479	527,010
Deficiency
Capital stock	820,357	820,357
Contributed surplus	22,488	19,960
Deficit	(1,291,834)	(1,239,302)
Total deficiency	(448,989)	(398,985)
Total liabilities and deficiency	177,490	128,025

Postmedia Network Canada Corp. Consolidated Statements of Cash Flows (UNAUDITED)
(In thousands of Canadian dollars)	For the three months ended		For the year ended
	May 31, 2026	May 31, 2025	May 31, 2026	May 31, 2025
Cash Generated (Utilized) by:
Operating Activities
Net (loss) income after income taxes	(35,355)	7,905	(52,261)	(32,567)
Items not affecting cash:
Depreciation	10,868	2,037	17,118	6,358
Amortization	853	1,703	1,983	5,132
Impairment	-	-	1,755	1,501
Loss (gain) on derivative financial instruments and financial assets at fair value through profit and loss	156	(262)	766	(169)
Non-cash interest	10,740	9,970	31,640	29,736
Loss (gain) on disposal of right of use assets and assets held for sale	-	119	23	(2,707)
Non-cash foreign currency exchange losses (gains)	4,140	(17,744)	1,473	6,363
Share-based compensation plans	172	162	602	412
Net financing expense relating to employee benefit plans	262	289	787	866
Employee benefit plan funding in excess of compensation expense	(771)	(904)	(2,132)	(2,461)
Net change in non-cash operating accounts	19,259	(738)	20,987	2,468
Cash flows from operating activities	10,324	2,537	22,741	14,932
Investing Activities
Net proceeds from the sale of assets held-for-sale and other assets	-	2,900	-	8,530
Purchases of property and equipment	(734)	(170)	(1,292)	(517)
Purchases of intangible assets	(1,594)	(43)	(3,876)	(1,165)
Purchases of other assets	(250)	-	(250)	-
Acquisition, net of cash acquired	(1,233)	-	(1,233)	-
Cash flows (used in) from investing activities	(3,811)	2,687	(6,651)	6,848
Financing activities
Advances from asset-based lending facility	6,000	1,665	12,432	5,406
Repayment of asset-based lending facility	(7,000)	(4,783)	(15,313)	(7,935)
Repayment of short term promissory note	-	-	-	(5,000)
Repayment of first lien senior secured notes	-	(2,804)	-	(7,734)
Repayment of contingent consideration	(859)	(371)	(3,479)	(1,043)
Lease payments	(2,243)	(1,539)	(5,543)	(4,668)
Cash flow used in financing activities	(4,102)	(7,832)	(11,903)	(20,974)
Net change in cash for the period	2,411	(2,608)	4,187	806
Cash at beginning of period	5,054	5,868	3,278	2,454
Cash at end of period	7,465	3,260	7,465	3,260
Supplemental disclosure of operating cash flows
Interest paid	877	733	2,591	2,194