<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of OCTOBER 1999
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QUEBECOR PRINTING INC.
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(Translation of Registrant's Name into English)
612 Saint-Jacques Street, Montreal, Quebec, H3C 4M8
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(Address of Principal Executive Office)
(Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F)
Form 20-F Form 40-F X
---- ----
(Indicate by check mark whether the registrant by furnishing the information
contained in this form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.)
Yes No X
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Page 1 of 10
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Press Releases
and
Consolidated Financial Statements
of
QUEBECOR PRINTING INC.
Filed in this Form 6-K
Documents index
1. Press Release dated October 22, 1999 (#18/99);
2. Consolidated Financial Statements for the three months period ended
September 30, 1999.
Page 2 of 10
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[LETTERHEAD]
October 22, 1999 18/99
FOR IMMEDIATE RELEASE
QUEBECOR PRINTING'S THIRD QUARTER RESULTS -
QUARTERLY REVENUES SURPASS THE $1 BILLION MARK FOR THE FIRST TIME -
MONTREAL - Quebecor Printing Inc. announced today third quarter earnings
available to holders of equity shares of US $53 million, versus US $44 million
for the same three months in 1998. Earnings per share increased 16% to US
$0.44 from US $0.38 per share in 1998. The improved earnings reflect strong
performance of the U.S. and Canadian operations, which was partially offset
by weaker earnings in France. Revenues for the quarter surpassed the
one-billion mark, reaching US $1,257 million, a 31% increase from
US $957 million last year.
The 1999 results include five-weeks of results from World Color Press for the
period beginning August 20, 1999 to the end of the quarter, with a minority
interest equivalent to 49.6% of the outstanding common stock of World Color.
For the nine months of 1999, net income available to holders of equity shares
rose to US $118 million or $1.00 per share, compared with US $98 million or
US $0.85 per share in 1998. Free cash flow from operations was in excess of
US $350 million, compared with a cash flow deficiency for the first nine months
last year of US $30 million. Revenues increased 14% to US $3,112 million,
from US $2,729 million for the nine-month period in 1998.
Included in the 1999 results are non-operating expenses equivalent to
US $2.5 million or US $0.02 per share, partly stemming from costs associated
with the shutdown of the printing plant located in San Jose, CA. Excluding
non-operating expenses and the impact of divested businesses, net income for
the third quarter was US $58 million or US $0.46 per share, compared with
US $45 million or US $0.37 per share in 1998, a 24% increase on a per-share
basis.
The increase in profitability for the quarter was due primarily to improved
efficiency and productivity of recently retooled plants in the United States,
an exceptional performance of the Canadian operations, achieved despite the
divestiture of the cheque printing business, and the contribution of the
World Color operations.
Charles G. Cavell, President and Chief Executive Officer said, "The third
quarter marks the starting point from which we intend to deliver significant
positive benefits from the integration of the World Color operations. Synergies
realized in the month of September alone were in excess of US $2 million, or
close to US $25 million annualized. Our objective is to realize annual cost
savings in excess of US $50 million."
Operating margins continued to improve during the quarter. On a consolidated
basis, the year-to-date operating margin increased to 8.2%, from 7.5% for the
same nine months last year and above the 7.9% margin achieved for the entire
year in 1998, which had the benefit of traditionally higher fourth quarter
margins.
Page 3 of 10
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[LETTERHEAD]
October 22, 1999 18/99
FOR IMMEDIATE RELEASE
In France, operations were affected by increased industry capacity and a more
competitive market, leading to lower volume and pricing pressures. Operations
in Sweden were also affected by a lower volume of business. In South America,
earnings for the quarter declined to a breakeven level as a result of a
difficult operating environment. This environment included the impact of the
recent currency devaluation in Brazil and Colombia's worst recession on
record. Significant cost reduction measures were implemented in the Company's
Chilean and Argentinian operations to compensate for the significant
reduction in exports to Brazil and resulting intensified competition in their
local markets. Operations in Peru continued to achieve a strong performance.
DEVELOPMENTS
On July 12, 1999, Quebecor Printing announced that it had entered into an
agreement to acquire World Color Press, Inc., a leading commercial printer in
the United States. The acquisition was structured as a cash tender offer
followed by a merger for a total consideration of US $2.9 billion, including
the assumption of debt. The acquisition, the largest in the history of the
printing industry, makes Quebecor Printing the largest commercial printer in
the world.
During the quarter, Quebecor Printing completed the acquisition of
Oberndorfer Druckerei, a leading web offset printer in Austria with annual
revenues of approximately US $66 million. An agreement in principle for this
acquisition had been reached prior to the announcement of the World Color
acquisition. The transaction structure was amended to enable the company to
maximize free cash flow available to reduce indebtedness related to the World
Color acquisition.
The closing of the sale of BA Banknote took place on October 20, 1999.
Proceeds from this divestiture will be applied to the reduction of bank
indebtedness. This divestiture emphasizes Quebecor Printing's continuing
strategy to focus on core printing businesses and to generate free cash flow
to reduce debt.
The Board of Directors declared a dividend of US $0.07 per share on the
Multiple Voting Shares and Subordinate Voting Shares. The Board of Directors
also declared a dividend of CDN $0.3125 per share on Series 2 Preferred
Shares. The two dividends are payable on December 1, 1999 to shareholders of
record at the close of business on November 10, 1999.
Quebecor Printing Inc. (NYSE: PRW; ME: IQI; TSE: IQI), a diversified global
commercial printing company, is the largest commercial printer in the world.
The Company is a market leader in most of its major product categories which
include magazines, inserts and circulars, books, catalogs, specialty
printing, related services, CD-ROM mastering and replicating, and
directories. The Company has over 43,000 employees working in approximately
170 printing and related facilities in the United States, Canada, France, the
United Kingdom, Spain, Germany, Sweden, Finland, Austria, Chile, Argentina,
Peru, Colombia, Mexico and India.
Page 4 of 10
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[LETTERHEAD]
October 22, 1999 18/99
FOR IMMEDIATE RELEASE
FOR FURTHER INFORMATION:
Christian M. Paupe Angela K. Olsen
Executive Vice President Director, Corporate Communications
(514) 954-0101 (514) 877-5317
(800) 567-7070 (800) 567-7070
Page 5 of 10
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QUEBECOR PRINTING INC.
THIRD QUARTER 1999
PERIODS ENDED SEPTEMBER 30
(In millions of US dollars, except per share data)
<TABLE>
<CAPTION>
3 M O N T H S 9 M O N T H S
1999 1998 CHANGE 1999 1998 CHANGE
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<S> <C> <C> <C> <C> <C> <C>
SEGMENTED INFORMATION
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REVENUES
United States 775,7 521,6 48,7% 1 704,4 1 503,8 13,3%
Canada 224,4 216,5 3,7% 688,6 677,0 1,7%
Europe 238,0 205,4 15,9% 660,3 501,3 31,7%
South America 19,6 13,4 45,7% 60,0 44,2 36,0%
OPERATING INCOME
United States 84,3 50,7 66,3% 144,7 109,9 31,7%
Canada 22,5 16,8 34,3% 65,9 53,8 22,6%
Europe 13,3 18,2 (27,3%) 37,6 36,1 4,3%
South America 0,1 0,7 (92,4%) 3,4 3,1 8,5%
OPERATING MARGIN
United States 10,9% 9,7% 8,5% 7,3%
Canada 10,0% 7,8% 9,6% 7,9%
Europe 5,6% 8,9% 5,7% 7,2%
South America 0,3% 5,5% 5,6% 7,0%
CONSOLIDATED RESULTS
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Revenues 1 257,1 957,2 31,3% 3 112,0 2 729,2 14,0%
Operating income before depreciation & amortization 199,6 147,6 35,2% 459,0 379,7 20,9%
Operating income 120,2 85,5 40,6% 255,2 204,4 24,8%
Net Income 55,7 46,5 19,7% 125,8 106,1 18,5%
Net Income available for holders of equity shares 53,1 44,0 20,7% 118,2 98,4 20,1%
INCOME AS% OF REVENUES
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Operating income before depreciation & amortization 15,9% 15,4% 14,7% 13,9%
Operating income 9,6% 8,9% 8,2% 7,5%
PER SHARE DATA ( $ US )
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Cash flow from operations $1,20 $1,09 $2,95 $2,66
Net Income $0,44 $0,38 $1,00 $0,85
PER SHARE DATA ( $ CDN ) *
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Cash flow from operations $1,80 $1,66 $4,40 $3,92
Net Income $0,65 $0,57 $1,48 $1,25
REVENUES BY PRODUCT SEGMENT (% )
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Magazines 30,1% 29,6% 30,4% 29,2%
Inserts and circulars 22,9% 20,4% 21,7% 19,7%
Catalogs 16,8% 16,1% 15,4% 16,0%
Books 13,2% 14,1% 13,6% 13,9%
Specialty Printing and direct mailing 8,5% 10,2% 9,2% 10,4%
Directories 4,1% 3,7% 4,6% 4,5%
Related Services and CDROM 3,7% 4,2% 4,3% 4,4%
Others 0,7% 1,7% 0,8% 1,9%
</TABLE>
* For reference only - subject to fluctuations of the exchange rate.
Page 6 of 10
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QUEBECOR PRINTING INC. AND ITS SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS OF US DOLLARS)
<TABLE>
<CAPTION>
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SEPTEMBER 30 December 31 September 30
1999 1998 1998
(UNAUDITED) (audited) (unaudited)
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<S> <C> <C> <C>
ASSETS
Current assets :
Cash $ 3,805 $ 309 $ 1,917
Trade receivables 747,126 695,867 678,512
Inventories 564,922 233,019 262,930
Prepaid expenses 39,882 25,035 26,460
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1,355,735 954,230 969,819
Fixed assets 4,233,243 3,224,609 3,206,579
less accumulated depreciation 1,166,802 1,013,645 987,460
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3,066,441 2,210,964 2,219,119
Goodwill 1,923,622 595,724 597,742
Other assets 140,044 81,198 71,017
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$6,485,842 $3,842,116 $3,857,697
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities :
Bank indebtedness $ 4,397 $ 15,607 $ 16,196
Trade payables and accrued liabilities 993,827 601,244 561,796
Income and other taxes 21,435 42,207 25,412
Current portion of long-term debt 40,628 51,066 43,813
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1,060,287 710,124 647,217
Long-term debt 2,683,814 1,140,941 1,254,126
Other liabilities 195,879 127,859 123,602
Deferred income taxes 276,982 223,085 233,037
Convertible debentures 204,727 58,193 62,591
Non-controlling interest 275,048 17,410 16,363
Shareholders' equity :
Capital stock 1,061,994 898,138 897,656
Contributed surplus 88,737 88,737 88,737
Retained earnings 718,463 629,596 585,531
Translation adjustment (80,089) (51,967) (51,163)
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1,789,105 1,564,504 1,520,761
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$6,485,842 $3,842,116 $3,857,697
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Page 7 of 10
</TABLE>
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QUEBECOR PRINTING INC. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS OF US DOLLARS, EXCEPT FOR EARNINGS PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
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Three months ended Nine months ended
September 30, September 30,
1999 1998 1999 1998
(Unaudited) (Unaudited)
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<S> <C> <C> <C> <C>
REVENUES $1,257,143 $957,174 $3,111,981 $2,729,224
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Operating expenses :
Operating costs 1,057,537 809,546 2,652,995 2,349,502
Depreciation and amortization 79,373 62,137 203,832 175,290
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1,136,910 871,683 2,856,827 2,524,792
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OPERATING INCOME 120,233 85,491 255,154 204,432
Financial expenses 27,574 16,063 61,247 46,475
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92,659 69,428 193,907 157,957
Income taxes 27,797 21,871 58,171 49,757
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64,862 47,557 135,736 108,200
Non-controlling interest 9,212 1,072 9,973 2,078
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NET INCOME 55,650 46,485 125,763 106,122
Net income available for holders
of preferred shares 2,523 2,481 7,544 7,702
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NET INCOME AVAILABLE FOR HOLDERS
OF EQUITY SHARES $ 53,127 $ 44,004 $ 118,219 $ 98,420
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EARNINGS PER SHARE $ 0.44 $ 0.38 $ 1.00 $ 0.85
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AVERAGE NUMBER OF EQUITY SHARES
OUTSTANDING (IN THOUSANDS) 122,538 115,736 118,680 115,678
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</TABLE>
Page 8 of 10
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QUEBECOR PRINTING INC. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS OF US DOLLARS)
<TABLE>
<CAPTION>
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Nine months ended
September 30,
1999 1998
(Unaudited)
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<S> <C> <C>
Cash flows provided by (used for):
OPERATIONS:
Net income $ 125,763 $ 106,122
Non-cash items in income :
Depreciation and amortization 203,832 175,290
Deferred income taxes 25,046 30,903
Non-controlling interest 9,973 2,078
Other (6,477) 1,428
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358,137 315,821
Changes in non-cash operating working capital 91,831 (83,583)
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449,968 232,238
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FINANCING:
Net proceeds from issuance of capital stock 159,498 1,655
Net increase of long-term debt 304,433 285,997
Decrease in bank indebtedness (11,210) (2,788)
Dividends on equity shares (24,917) (20,828)
Dividends paid to preferred shareholders (7,615) (8,277)
Dividends paid to non-controlling shareholders (713) (1,467)
Translation adjusment 8,335 (1,558)
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427,811 252,734
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INVESTMENTS:
Business acquisitions, net of cash position (785,781) (242,645)
Additions to fixed assets (112,159) (255,397)
Proceeds from disposal of assets 27,298 1,779
Increase in other assets (6,870) (3,628)
Other 3,173 16,536
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(874,339) (483,355)
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Effect of exchange rate variations on cash 56 (80)
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INCREASE IN CASH 3,496 1,537
Cash at beginning 309 380
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CASH AT END $ 3,805 $ 1,917
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</TABLE>
Page 9 of 10
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
QUEBECOR PRINTING INC.
By: (s) CLAUDINE TREMBLAY
-----------------------------
Name: Claudine Tremblay
Title: Assistant Secretary
Date: OCTOBER 22, 1999
Page 10 of 10
