Corus Entertainment Announces Fiscal 2016 Third Quarter Results

Corus Entertainment Announces Fiscal 2016 Third Quarter Results


-- Closed the acquisition of Shaw Media Inc. on April 1, 2016
-- Consolidated revenues up 78% for the quarter and 27% for the
year-to-date
-- Consolidated segment profit((1)) up 90% for the quarter and 38% (31%
adjusted((1)(2))) for the year-to-date
-- Net loss attributable to shareholders of $15.8 million ($0.10 loss per
share basic) for the quarter and net income attributable to shareholders
of $127.8 million ($1.16 earnings per share basic) for the year-to-date
-- Adjusted basic earnings per share((1)(2)) of $0.34 per share for the
quarter and $1.05 per share for the year-to-date
TORONTO, July 13, 2016 /PRNewswire/ - Corus Entertainment Inc. (TSX: CJR.B) announced its third quarter financial results today.

"This quarter marks an exciting milestone in our transformation, as we report the combined results of the new Corus for the first time," said Doug Murphy, President and Chief Executive Officer. "We are pleased with the tremendous progress made by our talented and committed team as they move quickly to realize the benefits of our new scale and maximize cost synergies. Moving forward, our focus will be on the pursuit of revenue and cost synergies, strong execution on integration and advancing our strategic priorities, which will deliver value to our shareholders over the longer term."



Financial Highlights
--------------------

Three months ended Nine months ended

May 31, May 31,

(unaudited - in thousands of Canadian dollars except per share amounts) 2016 2015 2016 2015
---------------------------------------------------------------------- ---- ---- ---- ----

Revenues

Television 321,176 162,767 668,326 499,432

Radio 39,648 40,354 118,521 122,284
----- ------ ------ ------- -------

360,824 203,121 786,847 621,716
======= ======= ======= =======


Segment profit(1)

Television 127,968 64,075 297,408 207,554

Radio 9,665 9,457 27,650 28,504

Corporate (7,447) (4,833) (19,415) (14,364)
--------- ------ ------ ------- -------

130,186 68,699 305,643 221,694
======= ====== ======= =======


Net income (loss) attributable to shareholders (15,766) (8,109) 127,786 (42,989)

Adjusted net income attributable to shareholders(1) (2) 52,950 31,550 116,378 111,955
====================================================== ====== ====== ======= =======


Basic earnings (loss) per share $(0.10) $(0.09) $1.16 $(0.50)

Adjusted basic earnings per share(1) (2) $0.34 $0.36 $1.05 $1.30

Diluted earnings (loss) per share $(0.10) $(0.09) $1.15 $(0.50)
================================= ====== ====== ===== ======


Free cash flow(1) 67,947 63,419 126,768 156,043
================ ====== ====== ======= =======


(1) Segment
profit,
adjusted
segment
profit,
adjusted net
income
attributable
to
shareholders,
adjusted
basic
earnings per
share, and
free cash
flow do not
have
standardized
meanings
prescribed by
IFRS. The
Company
believes
these non-
IFRS measures
are
frequently
used as key
measures to
evaluate
performance.
For
definitions
and
explanations,
see
discussion
under the Key
Performance
Indicators
section of
the Fiscal
2016 Report
to
Shareholders.

(2) For the three
months ended
May 31, 2016,
adjusted net
income
attributable
to
shareholders
excludes
business
acquisition,
integration
and
restructuring
charges of
$29.3 million
($0.15 per
share) and
debt
refinancing
costs of
$61.2 million
($0.29 per
share). For
the nine
months ended
May 31, 2016,
adjusted net
income
attributable
to
shareholders
represents
net income
attributable
to
shareholders
adjusted to
include
amortization
of disposed
Pay TV
programming
assets of
$15.6 million
($0.11 per
share) and
excludes
business
acquisition,
integration
and
restructuring
charges of
$37.6 million
($0.29 per
share), a
gain on the
disposal of
the Pay TV
disposal
group of
$86.2 million
($0.70 per
share) and
debt
refinancing
costs of
$61.2 million
($0.41 per
share). For
the three
months ended
May 31, 2015,
adjusted net
income
attributable
to
shareholders
excludes
intangible
asset
impairment
charges of
$51.8 million
($0.44 per
share) and
business
acquisition,
integration
and
restructuring
charges of
$2.7 million
($0.02 per
share). For
the nine
months ended
May 31, 2015,
adjusted net
income
attributable
to
shareholders
excludes
radio
broadcast
license and
goodwill
impairment
charges of
$130.0
million
($1.44 per
share),
intangible
asset
impairment
charges of
$51.8 million
($0.44 per
share),
business
acquisition,
integration
and
restructuring
charges of
$10.7 million
($0.09 per
share),
offset by a
gain on
distribution
of investment
of $17.0
million
($0.17 per
share).


Consolidated Results from Operations

Commencing April 1, 2016, 100% of the operating results of Shaw Media Inc. ("Shaw Media"), as well as its assets and liabilities, have been fully consolidated as a business combination which occurred in accordance with IFRS 3 - Business Combinations and, as a result, Shaw Media has been accounted for by applying the acquisition method as of that date. Shaw Media has been reported as part of the Television segment (further discussion is provided in note 17 of the Company's interim condensed consolidated financial statements for the period ended May 31, 2016).

In addition, for fiscal 2016, certain of Corus' Pay Television business' ("Pay TV") assets and liabilities were reclassified as held for disposal effective November 19, 2015 as a consequence of meeting the definition of assets held for sale under IFRS 5 - Non-current Assets Held for Sale and Discontinued Operations. The disposal group, Pay TV, did not qualify for discontinued operations presentation and, as a result, its operating results remain in continuing operations in the consolidated statement of income and comprehensive income for the nine months ended May 31, 2016. However, intangible assets classified as held for disposal ceased being amortized effective November 19, 2015 and as a consequence, amortization of program and film rights in the Television segment for the nine months ended May 31, 2016 is approximately $15.6 million lower than it would have been had amortization on these assets not ceased. On February 29, 2016, the Pay TV disposition was completed and the related proceeds and gain associated with this disposal group were recognized (further discussion is provided in note 17 of the Company's interim condensed consolidated financial statements for the period ended May 31, 2016).

Consolidated revenues for the three months ended May 31, 2016 were $360.8 million, up 78% from $203.1 million last year. Consolidated segment profit was $130.2 million, up 90% from $68.7 million last year. Net loss attributable to shareholders for the quarter was $15.8 million ($0.10 loss per share basic and diluted), as compared to $8.1 million ($0.09 loss per share basic and diluted) last year. Net loss attributable to shareholders for the third quarter of fiscal 2016 includes business acquisition, integration and restructuring costs of $29.3 million ($0.15 per share) and debt refinancing costs of $61.2 million ($0.29 per share). Adjusting for the impact of these items results in an adjusted net income attributable to shareholders of $53.0 million ($0.34 per share basic) in the quarter. Net loss attributable to shareholders for prior year quarter includes intangible asset impairment charges of $51.8 million ($0.44 per share) and business acquisition, integration and restructuring costs of $2.7 million ($0.02 per share). Adjusting for the impact of these items results in an adjusted net income attributable to shareholders of $31.6 million (0.36 per share) in the prior year quarter.

Consolidated revenues for the nine months ended May 31, 2016 were $786.8 million, up 27% from $621.7 million last year. Consolidated segment profit was $305.6 million, up 38% from $221.7 million last year, however, excludes amortization of disposed Pay TV program and film rights of $15.6 million. Adjusting for this, segment profit would be $290.0 million, up 31% from last year. Net income attributable to shareholders for the nine months ended May 31, 2016 was $127.8 million ($1.16 per share), compared to a net loss of $43.0 million ($0.50 loss per share) last year. Net income attributable to shareholders for the nine months ended May 31, 2016 includes business acquisition, integration and restructuring costs of $37.6 million ($0.29 per share), debt refinancing costs of $61.2 million ($0.41 per share), a gain relating to the discontinuation of the Pay TV business and the disposal of certain assets of $86.2 million ($0.70 per share), and excludes amortization of disposed of Pay TV program and film rights of $15.6 million ($0.11 per share). Adjusting for the impact of these items results in an adjusted net income attributable to shareholders of $116.4 million ($1.05 per share basic) for the current year-to-date. Net loss attributable to shareholders for the nine months ended May 31, 2015 includes Radio broadcast license and goodwill impairment charges of $130.0 million ($1.44 per share), intangible asset impairment charges of $51.8 million ($0.44 per share) and business acquisition, integration and restructuring costs of $10.7 million ($0.09 per share), offset by a gain on disposition of investment of $17.0 million ($0.17 per share). Adjusting for the impact of these items results in an adjusted net income attributable to shareholders of $112.0 million ($1.30 per share) for the prior year-to- date.

Operational Results - Highlights

Television


-- Ceased Pay TV operations February 29, 2016
-- Shaw Media Inc. operating results included commencing April 1, 2016
-- Advertising revenues increased 236% in Q3 2016 and 71% for the
year-to-date
-- Subscriber revenues increased 16% in Q3 2016 and 8% for the year-to-date
-- Merchandising, distribution and other revenues increased 24% in Q3 2016
and 30% for the year-to-date
-- Segment profit((1)) increased 100% in Q3 2016 and 43% for the
year-to-date
-- Adjusted segment profit((1) (2)) increased 36% for the year-to-date
-- Adjusted segment profit margin((1)(2)) was 40% in Q3 2016 and 42% for
the year-to-date
Radio


-- Segment revenues decreased 2% in Q3 2016 and 3% for the year-to-date
-- Segment profit((1)) increased 2% in Q3 2016 and decreased 3% for the
year-to-date
-- Segment profit margin((1)) of 24% in Q3 2016 and 23% for the
year-to-date


(1) Segment profit, adjusted segment
profit, segment profit margin and
adjusted segment profit margin do
not have standardized meanings
prescribed by IFRS. The Company
reports on these because they are
key measures used to evaluate
performance. For definitions and
explanations, see discussion
under the Key Performance
Indicators section of the 2016
Report to Shareholders.

(2) For the nine months ended May 31,
2016, segment profit has been
adjusted to include amortization
of disposed Pay TV program and
film rights of $15.6 million.


Corus Entertainment Inc. reports in Canadian dollars.

The unaudited consolidated financial statements and accompanying notes for the three and nine months ended May 31, 2016 and Management's Discussion and Analysis are available on the Company's website at www.corusent.com in the Investor Relations section.

A conference call with Corus senior management is scheduled for July 13, 2016 at 9:00 a.m. ET. While this call is directed at analysts and investors, members of the media are welcome to listen in. The dial-in number for the conference call for local and international callers is 1.416.359.3130 and for North America is 1.800.694.7044. More information can be found on the Corus Entertainment website at www.corusent.com in the Investor Relations section.

Use of Non-IFRS Financial Measures

This press release includes the non-IFRS financial measures of adjusted net income attributable to shareholders, adjusted basic earnings per share and free cash flow that are not in accordance with, nor an alternate to, generally accepted accounting principles ("IFRS") and may be different from non-IFRS measures used by other companies. In addition, these non-IFRS measures are not based on any comprehensive set of accounting rules or principles.

Non-IFRS financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with IFRS. They are limited in value because they exclude charges that have a material effect on the Company's reported results and, therefore, should not be relied upon as the sole financial measures to evaluate the Company's financial results. The non-IFRS financial measures are meant to supplement, and to be viewed in conjunction with, IFRS financial results. A reconciliation of the Company's non-IFRS measures is included in the Company's most recent Report to Shareholders which is available on Corus' website at www.corusent.com as well as on SEDAR.

Caution Concerning Forward-Looking Statements

This press release contains forward-looking information and should be read subject to the following cautionary language:

To the extent any statements made in this report contain information that is not historical, these statements are forward-looking statements and may be forward-looking information within the meaning of applicable securities laws (collectively, "forward-looking statements"). These forward-looking statements relate to, among other things, our objectives, goals, strategies, intentions, plans, estimates and outlook, including advertising, distribution, merchandise and subscription revenues, operating costs and tariffs, taxes and fees, and can generally be identified by the use of the words such as "believe", "anticipate", "expect", "intend", "plan", "will", "may" and other similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. Although Corus believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties and undue reliance should not be placed on such statements. Certain material factors or assumptions are applied in making forward-looking statements, including without limitation factors and assumptions regarding advertising, distribution, merchandise and subscription revenues, operating costs and tariffs, taxes and fees and actual results may differ materially from those expressed or implied in such statements. Important factors that could cause actual results to differ materially from these expectations include, among other things: our ability to attract and retain advertising revenues; audience acceptance of our television programs and cable networks; our ability to recoup production costs, the availability of tax credits and the existence of co-production treaties; our ability to compete in any of the industries in which we do business; the opportunities (or lack thereof) that may be presented to and pursued by us; conditions in the entertainment, information and communications industries and technological developments therein; changes in laws or regulations or the interpretation or application of those laws and regulations; our ability to integrate and realize anticipated benefits from our acquisitions and to effectively manage our growth; our ability to successfully defend ourselves against litigation matters arising out of the ordinary course of business; and changes in accounting standards. Additional information about these factors and about the material assumptions underlying such forward-looking statements may be found in our Annual Information Form. Corus cautions that the foregoing list of important factors that may affect future results is not exhaustive. When relying on our forward-looking statements to make decisions with respect to Corus, investors and other should carefully consider the foregoing factors and other uncertainties and potential events. Unless otherwise required by applicable securities laws, Corus disclaims any intention or obligation to publicly update or revise any forward-looking statements whether as a result of new information, events or circumstances that arise after the date thereof or otherwise.

About Corus Entertainment Inc.

Corus Entertainment Inc. (TSX: CJR.B) is a leading media and content company that creates and delivers high quality brands and content across platforms for audiences around the world. The company's portfolio of multimedia offerings encompasses 45 specialty television services, 39 radio stations, 15 conventional television stations, a global content business, digital assets, live events, children's book publishing, animation software, technology and media services. Corus' roster of premium brands include Global Television, W Network, OWN: Oprah Winfrey Network Canada, HGTV Canada, Food Network Canada, HISTORY®, Showcase, National Geographic, Q107, CKNW, Fresh Radio, Disney Channel Canada, YTV and Nickelodeon Canada. Visit Corus at www.corusent.com.






CORUS ENTERTAINMENT INC.

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION


As at May 31, As at August 31,

(unaudited - in thousands of Canadian dollars) 2016 2015
--------------------------------------------- ---- ----

ASSETS

Current

Cash and cash equivalents 67,637 37,422

Accounts receivable 444,586 164,600

Income taxes recoverable - 12,439

Prepaid expenses and other 26,095 13,855
-------------------------- ------ ------


Total current assets 538,318 228,316
-------------------- ------- -------


Tax credits receivable 24,363 25,958

Investments and other assets 43,086 42,958

Property, plant and equipment 281,194 139,140

Program and film rights 698,582 315,899

Film investments 50,004 36,549

Intangibles 2,058,270 974,615

Goodwill 2,432,044 827,859

Deferred income tax assets 69,140 40,815
-------------------------- ------ ------

6,195,001 2,632,109
========= =========


LIABILITIES AND SHAREHOLDERS' EQUITY

Current

Accounts payable and accrued liabilities 453,022 210,971

Current portion of long-term debt 115,000 150,000

Income taxes payable 15,884 -

Provisions 14,598 8,930
---------- ------ -----

Total current liabilities 598,504 369,901
------------------------- ------- -------


Long-term debt 2,107,484 651,002

Other long-term liabilities 526,192 138,833

Deferred income tax liabilities 447,397 252,462
------------------------------- ------- -------

Total liabilities 3,679,577 1,412,198
----------------- --------- ---------


SHAREHOLDERS' EQUITY

Share capital 2,138,166 994,571

Contributed surplus 10,140 9,471

Retained earnings 205,786 191,182

Accumulated other comprehensive income 2,074 7,353
-------------------------------------- ----- -----

Total equity attributable to shareholders 2,356,166 1,202,577

Equity attributable to non-controlling interest 159,258 17,334
----------------------------------------------- ------- ------

Total shareholders' equity 2,515,424 1,219,911
-------------------------- --------- ---------

6,195,001 2,632,109
========= =========







CORUS ENTERTAINMENT INC.

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME


Three months ended Nine months ended


May 31, May 31,

(unaudited - in thousands of Canadian dollars except per share amounts) 2016 2015 2016 2015
---------------------------------------------------------------------- ---- ---- ---- ----

Revenues 360,824 203,121 786,847 621,716

Direct cost of sales, general and administrative expenses 230,638 134,422 481,204 400,022

Depreciation and amortization 18,776 6,056 40,384 17,919

Interest expense 33,697 13,140 71,074 38,567

Broadcast license and goodwill impairment - - - 130,000

Intangible asset impairment - 51,786 - 51,786

Debt refinancing costs 61,248 - 61,248 -

Business acquisition, integration and restructuring costs 29,264 2,693 37,639 10,695

Gain on disposition - - (86,151) -

Other expense (income), net (2,018) 1,405 7,036 (12,691)
--------------------------- ------ ----- ----- -------


Income (loss) before income taxes (10,781) (6,381) 174,413 (14,582)

Income tax expense 120 486 39,357 24,962


Net income (loss) for the period (10,901) (6,867) 135,056 (39,544)
================================ ======= ====== ======= =======


Net income (loss) attributable to:

Shareholders (15,766) (8,109) 127,786 (42,989)

Non-controlling interest 4,865 1,242 7,270 3,445
------------------------ ----- ----- ----- -----

(10,901) (6,867) 135,056 (39,544)
======= ====== ======= =======


Earnings (loss) per share attributable to shareholders:

Basic $(0.10) $(0.09) $1.16 $(0.50)

Diluted $(0.10) $(0.09) $1.15 $(0.50)
======= ====== ====== ===== ======


Net income (loss) for the period (10,901) (6,867) 135,056 (39,544)

Other comprehensive income (loss), net of tax:

Items that may be reclassified subsequently to income:

Unrealized foreign currency translation adjustment (527) (657) (61) 3,010

Unrealized change in fair value of available-for-sale investments 114 (51) (10) (191)

Unrealized change in fair value of cash flow hedges (5,527) 191 (5,208) (263)

Actuarial gain on post employment benefit plans 1,970 - 1,970 -
----------------------------------------------- ----- --- ----- ---

(3,970) (517) (3,309) 2,556
------ ---- ------ -----


Comprehensive income (loss) for the period (14,871) (7,384) 131,747 (36,988)
========================================== ======= ====== ======= =======


Comprehensive income (loss) attributable to:

Shareholders (19,736) (8,626) 124,477 (40,433)

Non-controlling interest 4,865 1,242 7,270 3,445
------------------------ ----- ----- ----- -----

(14,871) (7,384) 131,747 (36,988)
======= ====== ======= =======







CORUS ENTERTAINMENT INC.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY


(unaudited - in thousands of Canadian dollars) Share Contributed Retained Accumulated Total equity Non- Total equity
capital surplus earnings other attributable controlling
comprehensive to interest
income (loss) shareholders
--- ------------ ------------


At August 31, 2015 994,571 9,471 191,182 7,353 1,202,577 17,334 1,219,911

Comprehensive income (loss) - - 127,786 (3,309) 124,477 7,270 131,747

Dividends declared - - (115,152) - (115,152) (13,002) (128,154)

Issuance of shares under public equity offering 279,762 - - - 279,762 - 279,762

Issuance of shares to related party 833,541 - - 833,541 - 833,541

Existing non-controlling ownership interest from acquisition - - - - - 147,656 147,656

Issuance of shares under dividend reinvestment plan 30,292 - - - 30,292 - 30,292

Actuarial gain on post retirement benefit plans - - 1,970 (1,970) - - -

Share-based compensation expense - 669 - - 669 - 669
-------------------------------- --- --- --- --- --- --- ---

At May 31, 2016 2,138,166 10,140 205,786 2,074 2,356,166 159,258 2,515,424
=============== ========= ====== ======= ===== ========= ======= =========


At August 31, 2014 967,330 8,385 313,361 3,767 1,292,843 17,283 1,310,126

Comprehensive income (loss) - - (42,989) 2,556 (40,433) 3,445 (36,988)

Dividends declared - - (72,871) - (72,871) (4,553) (77,424)

Issuance of shares under stock option plan 6,741 (1,090) - - 5,651 - 5,651

Issuance of shares under dividend reinvestment plan 15,948 - - - 15,948 - 15,948

Share-based compensation expense - 1,842 - - 1,842 - 1,842
-------------------------------- --- ----- --- --- ----- --- -----

At May 31, 2015 990,019 9,137 197,501 6,323 1,202,980 16,175 1,219,155
=============== ======= ===== ======= ===== ========= ====== =========







CORUS ENTERTAINMENT INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS


Three months ended Nine months ended

May 31, May 31,

(unaudited - in thousands of Canadian dollars) 2016 2015 2016 2015
--------------------------------------------- ---- ---- ---- ----

OPERATING ACTIVITIES

Net income (loss) for the period (10,901) (6,867) 135,056 (39,544)

Adjustments to reconcile net income (loss) to cash provided by operating activities:

Amortization of program and film rights 100,533 54,078 198,786 161,781

Amortization of film investments 6,346 4,797 13,890 18,410

Depreciation and amortization 18,776 6,056 40,384 17,919

Broadcast license and goodwill impairment - - - 130,000

Imputed interest 11,675 4,076 32,906 11,053

Deferred income taxes (10,450) (2,704) (22,357) (3,721)

Share-based compensation expense 213 376 669 1,842

Intangible asset impairment - 51,786 - 51,786

Debt refinancing costs 61,248 - 61,248 -

Gain on disposition of investment - - (533) (16,964)

Gain on assets held for disposal - - (86,151) -

Business acquisition, integration and restructuring costs 13,274 - 15,992 -

Other 1,447 1,677 4,676 3,565

Net change in non-cash working capital balances related to operations 2,760 3,058 1,997 (11,797)

Payment of program and film rights (103,274) (36,182) (215,788) (135,189)

Net additions to film investments (13,021) (10,867) (31,702) (34,713)
--------------------------------- ------- ------- ------- -------

Cash provided by operating activities 78,626 69,284 149,073 154,428
------------------------------------- ------ ------ ------- -------


INVESTING ACTIVITIES

Additions to property, plant and equipment (4,100) (4,941) (10,956) (12,695)

Net proceeds from disposition - - 209,474 -

Business combinations, net of acquired cash (1,836,847) - (1,839,323) -

Business acquisition costs paid in the period (10,614) - (13,332) -

Proceeds from disposition of investment - - 1,684 18,490

Net cash flows for intangibles, investment and other assets (4,080) (2,969) (11,231) (20,555)

Other (4,247) (668) (8,527) (3,390)
----- ------ ---- ------ ------

Cash used in investing activities (1,859,888) (8,578) (1,672,211) (18,150)
--------------------------------- ---------- ------ ---------- -------


FINANCING ACTIVITIES

Increase (decrease) in bank loans 2,176,029 (34,966) 1,987,295 (44,863)

Redemption of Notes (550,000) - (550,000) -

Debt refinancing costs (55,671) - (55,671) -

Financing fees (20,167) - (23,595) (750)

Share subscription, net of issuance costs 276,529 - 276,529 -

Issuance of shares under stock option plan - 815 - 5,651

Dividends paid (24,453) (20,100) (64,569) (56,001)

Dividends paid to non-controlling interest (7,853) - (13,002) (4,553)

Other (964) (820) (3,634) (3,499)
----- ---- ---- ------ ------

Cash provided by (used in) financing activities 1,793,450 (55,071) 1,553,353 (104,015)
----------------------------------------------- --------- ------- --------- --------

Net change in cash and cash equivalents during the period 12,188 5,635 30,215 32,263

Cash and cash equivalents, beginning of the period 55,449 38,213 37,422 11,585
-------------------------------------------------- ------ ------ ------ ------

Cash and cash equivalents, end of the period 67,637 43,848 67,637 43,848
============================================ ====== ====== ====== ======







CORUS ENTERTAINMENT INC.

BUSINESS SEGMENT INFORMATION


(unaudited - in thousands of Canadian dollars)


Three months ended May 31, 2016

Television Radio Corporate Consolidated
---------- ----- --------- ------------

Revenues 321,176 39,648 - 360,824

Direct cost of
sales, general and
administrative
expenses 193,208 29,983 7,447 230,638
------------------- ------- ------ ----- -------

Segment profit
(loss)(1) 127,968 9,665 (7,447) 130,186

Depreciation and amortization 18,776

Interest expense 33,697

Debt refinancing costs 61,248

Business acquisition, integration and
restructuring costs 29,264

Other income, net (2,018)
----------------- ------

Loss before income taxes (10,781)
======================== =======


Three months ended May 31, 2015

Television Radio Corporate Consolidated
---------- ----- --------- ------------

Revenues 162,767 40,354 - 203,121

Direct cost of
sales, general and
administrative
expenses 98,692 30,897 4,833 134,422
------------------- ------ ------ ----- -------

Segment profit
(loss)(1) 64,075 9,457 (4,833) 68,699

Depreciation and amortization 6,056

Interest expense 13,140

Intangible asset impairment 51,786

Business acquisition, integration and
restructuring costs 2,693

Other expense, net 1,405
------------------ -----

Loss before income taxes (6,381)
======================== ======


Nine months ended May 31, 2016

Television Radio Corporate Consolidated
---------- ----- --------- ------------

Revenues 668,326 118,521 - 786,847

Direct cost of
sales, general and
administrative
expenses 370,918 90,871 19,415 481,204
------------------- ------- ------ ------ -------

Segment profit
(loss)(1) 297,408 27,650 (19,415) 305,643

Depreciation and amortization 40,384

Interest expense 71,074

Debt refinancing costs 61,248

Business acquisition, integration and
restructuring costs 37,639

Gain on disposition (86,151)

Other expense, net 7,036
------------------ -----

Income before income taxes 174,413
========================== =======


Nine months ended May 31, 2015

Television Radio Corporate Consolidated
---------- ----- --------- ------------

Revenues 499,432 122,284 - 621,716

Direct cost of
sales, general and
administrative
expenses 291,878 93,780 14,364 400,022
------------------- ------- ------ ------ -------

Segment profit
(loss)(1) 207,554 28,504 (14,364) 221,694

Depreciation and amortization 17,919

Interest expense 38,567

Broadcast license and goodwill impairment 130,000

Intangible asset impairment 51,786

Business acquisition, integration and
restructuring costs 10,695

Other income, net (12,691)
----------------- -------

Loss before income taxes (14,582)
======================== =======


(1) Segment
profit does
not have a
standardized
meaning
prescribed
by IFRS. For
definitions
and
explanations,
see
discussion
under the
Key
Performance
Indicators
section of
the 2015
Report to
Shareholders.







Revenues by type


Three months ended Nine months ended

May 31, May 31,

2016 2015 2016 2015
---- ---- ---- ----

Advertising 237,388 97,230 430,678 300,636

Subscriber fees 98,023 84,282 274,622 254,941

Merchandising, distribution and
other 25,413 21,609 81,547 66,139
------------------------------- ------ ------ ------ ------

360,824 203,121 786,847 621,716
======= ======= ======= =======




NON-IFRS FINANCIAL MEASURES


Three months ended Nine months ended

May 31, May 31,

2016 2015 2016 2015
---- ---- ---- ----

Adjusted Segment Profit

Reported segment
profit 130,186 68,699 305,643 221,694


Adjustments:

Amortization not taken on Pay TV
assets disposed of - - (15,585) -
-------------------------------- --- --- ------- ---

Adjusted segment
profit 130,186 68,699 290,058 221,694
================ ======= ====== ======= =======


Adjusted Net Income Attributable to Shareholders
------------------------------------------------

Reported net
income (loss)
attributable to
shareholders (15,766) (8,109) 127,786 (42,989)


Adjustments, net
of income
taxes:

Gain on disposal of Pay TV
assets - - (76,631) -

Amortization of certain Pay TV
assets - - (11,455) -

Business acquisition,
integration and restructuring
costs 23,699 1,604 31,661 7,621

Debt refinancing costs 45,017 - 45,017 -

Gain from disposition of
investment - - - (14,716)

Broadcast license and goodwill
impairment charges - - - 123,984

Intangible asset impairment
charges - 38,055 - 38,055
---------------------------- --- ------ --- ------

Adjusted net
income
attributable to
shareholders 52,950 31,550 116,378 111,955
================ ====== ====== ======= =======


Adjusted basic earnings per share $0.34 $0.36 $1.05 $1.30
================================= ===== ===== ===== =====


Free cash flow
--------------

Cash provided by
(used in):

Operating
activities 78,626 69,284 149,073 154,428

Investing
activities (1,859,888) (8,578) (1,672,211) (18,150)
---------- ---------- ------ ---------- -------

(1,781,262) 60,706 (1,523,138) 136,278

Add back: cash
used for
business
combinations
and strategic
investments(1) 1,849,209 2,713 1,859,380 19,765

Deduct: net
proceeds from
disposition - - (209,474) -
------------- --- --- -------- ---

Free cash flow 67,947 63,419 126,768 156,043
============== ====== ====== ======= =======


Strategic
investments
are
comprised
of
investments
in venture
funds and
associated
(1) companies.


SOURCE Corus Entertainment Inc.

Corus Entertainment Inc.

CONTACT: Doug Murphy, President and Chief Executive Officer, Corus Entertainment Inc., 416.479.6649; Tom Peddie, Executive Vice President and Chief Financial Officer, Corus Entertainment Inc., 416.479.6080; Dervla Kelly, Vice President, Communications, Corus Entertainment Inc., 416.934.7121

Web Site: www.corusent.com


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