The wage subsidy enabled Transcontinental to avoid layoffs, but it has also helped the company to maintain its profits.
At the beginning of the pandemic, the print volumes of the montreal company have dropped by 45 %.
Transcontinental responded quickly by announcing the layoff of 1,600 employees on march 25, and by reducing the work hours of other employees.
“These measures, coupled with the wage subsidy in Canada, we have helped deliver a solid quarter despite the crisis “, said yesterday the company’s CEO, François Olivier.
“While our revenues comparable [in the printing sector] declined by$ 83 Million, we have maintained a strong adjusted operating margin of 20 % “, he added.
Transcontinental anticipates that it will receive$ 8.2 Million in wage subsidy from Ottawa for the quarter ended April 26, representing 5 % of its total costs of labour.
Confident in the publisac network
The officer has assured that the decision of the supermarket chain Maxi to abandon the circular paper was isolated.
Several retailers have already taken over the distribution of their circulars, and “nearly all” those who have not yet done so are planning to follow suit in the near future, he insisted.
“This crisis has shown that the circulars printed remain a marketing tool relevant and effective in attracting the people in the store and assist Canadians to save in a difficult economic context marked by a high unemployment rate and the inflation in food prices “, said Mr. Olivier.
In the other activity sector of Transcontinental, packaging, business has been very good thanks to strong demand from the industries of food and other consumer products-essential.
The quarterly revenue Transcontinental declined 19 % to reach$ 625 Million, but net profits jumped by 15 per cent to 25.7 M$.
In spite of everything, the action the company has sold 3.9 per cent yesterday to close at 12,80 $.