transcontinental

TRANSCONTINENTAL INC. $15 (Toronto symbol TCL.A; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 78.0 million; Market cap: $1.2 billion; Price-to-sales ratio: 0.6; Dividend yield: 4.3%; TSINetwork Rating: Average; www. tctranscontinental.com) aims to cut its reliance on cyclical print advertising with a new deal to buy Missouri-based Capri Packaging, which makes plastic packaging for food....

TIM HORTONS INC., $58.25, Toronto symbol THI, rose this week after it reported higher-than-expected quarterly earnings. It also raised its dividend and announced a new share buyback plan. The company operates 3,588 coffee-and-donut stores in Canada and 859 in the U.S. It also has 38 outlets in the Persian Gulf. In the three months ended December 29, 2013, Tim Hortons’ revenue rose 10.7%, to $898.5 million from $811.6 million a year earlier. That’s mainly because it renovated more outlets, which let it charge franchisees higher fees. Same-store sales rose 1.6% at its Canadian locations and 3.1% in the U.S....

TRANSCONTINENTAL INC. $14 (Toronto symbol TCL.A; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 78.0 million; Market cap: $1.1 billion; Price-to-sales ratio: 0.5; Dividend yield: 4.1%; TSINetwork Rating: Average; www. tctranscontinental.com) is Canada’s leading printer of flyers, magazines, newspapers and books. This business accounts for 67% of its revenue and 85% of its earnings. The remaining 33% of revenue and 15% of earnings comes from publishing 35 magazines and 175 daily and weekly newspapers.

Advertisers continue to shift to the Internet. That’s why Transcontinental’s revenue fell from $2.2 billion in 2009 to $2.0 billion in 2011 (fiscal years end October 31). In 2012, the company traded its Mexican printing plants for six Canadian facilities. The new plants brought its revenue up to $2.1 billion in both 2012 and 2013.


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TRANSCONTINENTAL INC. (Toronto symbol TCL.A; www.tctranscontinental.com) is Canada’s leading printer of flyers, magazines, newspapers and books. This business accounts for 67% of its revenue and 85% of its earnings. The remaining 33% of revenue and 15% of earnings comes from publishing 35 magazines and 175 daily and weekly newspapers....

TRANSCONTINENTAL INC. $14 (Toronto symbol TCL.A; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 78.0 million; Market cap: $1.1 billion; Price-to-sales ratio: 0.5; Dividend yield: 4.1%; TSINetwork Rating: Average; www. tctranscontinental.com) is Canada’s leading printer of flyers, magazines, newspapers and books....

PRECISION DRILLING CORP., $9.75, Toronto symbol PD, sells contract drilling services to oil and natural gas producers. The stock fell sharply after the Alberta Investment Management Company (AIMCo) sold its entire 15% stake in the company for $9.50 to $9.75 a share. AIMCo is a Crown corporation that manages Alberta’s public-sector pension plans and other special funds. Precision ran into trouble in 2009, because the credit crisis hurt its ability to refinance short-term loans it needed to buy U.S.-based contract driller Grey Wolf Inc. That’s when AIMCo purchased notes and shares in Precision....

CANADIAN TIRE CORP., $92.02, Toronto symbol CTC.A, has announced more details of its plan to spin off most of its real estate holdings as a new, publicly traded real estate investment trust (REIT). This new REIT, called CT Real Estate Investment Trust, will hold 72% of Canadian Tire’s real estate assets, including 255 stores and one distribution centre. Canadian Tire will be CT REIT’s major tenant, accounting for 95.7% of its rental income. The average lease term is 16 years for the retail stores. Canadian Tire will also sign a new deal to lease the distribution centre for 17 years....

TRANSCONTINENTAL INC. (Toronto symbol TCL.A; www.tctranscontinental.com) gets 68% of its revenue from its commercial printing business, which is the largest in Canada. The remaining 32% comes from publishing newspapers and magazines. In its 2013 second quarter, which ended April 30, 2013, Transcontinental’s revenue fell 0.2%, to $521.3 million from $522.4 million a year earlier. Revenue from six recently acquired printing plants in Canada helped offset the loss of a contract to print flyers for the now-closed Zellers retail chain....

TRANSCONTINENTAL INC. $12 (Toronto symbol TCL.A; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 77.9 million; Market cap: $934.8 million; Price-to-sales ratio: 0.4; Dividend yield: 4.8%; TSINetwork Rating: Average; www.tctranscontinental.com) gets 68% of its revenue from its commercial printing business, which is the largest in Canada. The remaining 32% comes from publishing newspapers and magazines.

In its 2013 second quarter, which ended April 30, 2013, Transcontinental’s revenue fell 0.2%, to $521.3 million from $522.4 million a year earlier. Revenue from six recently acquired printing plants in Canada helped offset the loss of a contract to print flyers for the now-closed Zellers retail chain.

So far, the company has realized annual savings of $30 million by combining the new plants with its current operations. Even so, earnings fell 2.0% in the latest quarter, to $34.8 million from $35.5 million. Earnings per share were unchanged at $0.44 on fewer shares outstanding.
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Advertisers continue to move away from newspapers and magazines and toward online ads. These two media firms are cutting costs in response. The savings should help them expand their Internet businesses and maintain their dividend rates.

TRANSCONTINENTAL INC....