Quebecor World first-quarter adjusted EBITDA down to $41.4 million

By Caroline Salls

Pittsburgh, May 16 - Quebecor World Inc. reported a $41.4 million adjusted EBITDA for the three months ended March 31 on $1.265 billion in revenues, according to a company news release.

Adjusted EBITDA for the first quarter of 2007 was $92 million. Revenues for that period were $1.393 billion.

Quebecor World said the lower adjusted EBITDA can be attributed to reduced volume, customer losses realized last year in the U.S. book and catalog segments, lower prices related to excess capacity, a weaker worldwide economy and the impact of the creditor protection process.

The operating loss for the first quarter of 2008 was $74.2 million, compared with an $18.3 million operating loss reported in the first quarter of 2007.

Meanwhile, the net loss for the first quarter of 2008 was $190 million, widening significantly from a $38.1 million first-quarter 2007 net loss.

According to the release, the company incurred a $32 million non-cash loss related to its former U.K. facility in the first quarter of 2008, as well as $14.2 million in reorganization charges.

As of March 31, the company had $85.6 million in cash provided by operating activities, compared to $73.4 million at March 31, 2007.

"We continue to implement the final phases of our three-year retooling and restructuring plan, which is being completed in 2008," president and chief executive officer Jacques Mallette said in the release.

"Our refinancing efforts at the end of 2007 and our filing for creditor protection in the U.S. and Canada created uncertainty with selected customers. This resulted in spot volume reductions, which contributed to our reduced profitability.

"However, the overwhelming majority of our customers have been very supportive and we continue to work toward the objective of exiting creditor protection as soon as possible as a strong player in our industry. Our adjusted EBITDA results in the first quarter are also slightly ahead of projections for our DIP financing," Mallette added.

Quebecor World said it is developing a business plan that will reflect its expectation of future operating performance both during and after the Companies' Creditors Arrangement Act and Chapter 11 bankruptcy processes.

Quebecor, a Montreal-based printing and marketing company, filed for Chapter 11 bankruptcy on Jan. 21 in the U.S. Bankruptcy Court for the Southern District of New York and filed for protection under the Companies' Creditors Arrangement Act in Canada. Its Chapter 11 case number is 08-10152.

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