Transcontinental Inc. Announces Results for the First Quarter of Fiscal Year 2026

Highlights

• Revenues of $263.5 million for the quarter ended January 25, 2026; operating earnings of $8.2 million; and net loss from continuing operations of $0.2 million (0.00 $ per share).
• Adjusted operating earnings before depreciation and amortization⁽¹⁾ of $33.1 million for the quarter ended January 25, 2026; adjusted operating earnings⁽¹⁾ of $17.5 million; and adjusted net earnings from continuing operations⁽¹⁾ of $6.7 million ($0.08 per share).
• Subsequent to the closing of the first quarter of fiscal year 2026, announcement of the closing of the sale of the Packaging Business.
• Appointment of Sam Bendavid as Chief Executive Officer, effective April 6, 2026.

(1) Please refer to the “Non-IFRS Financial Measures” section of this press release for a definition of these measures.

MONTRÉAL, March 10, 2026 (GLOBE NEWSWIRE) — Transcontinental Inc. (TSX: TCL.A TCL.B) announces its results for the first quarter of fiscal year 2026 ended January 25, 2026.

“The closing of the sale of our packaging activities allows us to begin a new chapter of our history and focus our resources on our retail services and printing activities, as well as our educational publishing activities,” said Thomas Morin, President and Chief Executive Officer of TC Transcontinental.

“The recent acquisitions in our in-store marketing activities enabled us to partially offset the slowdown in our traditional activities as well as the impact of strategic price concessions to secure our traditional activities. Despite a challenging start to our fiscal year, we remain confident that we will deliver adjusted operating earnings before depreciation and amortization from continuing operations for fiscal year 2026 that will be similar to fiscal year 2025 at the consolidated level. Lastly, building on the three acquisitions we completed last year and aligned with our growth strategy in growth activities that include in-store marketing, we expect to close another acquisition in this segment in the next few weeks, and I am confident in our growth plan.”

“Furthermore, the sale of our packaging activities will contribute to reducing significantly our net indebtedness during fiscal year 2026,” added Donald LeCavalier, Executive Vice President and Chief Financial Officer of TC Transcontinental. “Our balance sheet is solid, and we are well positioned to benefit from growth opportunities in our retail services and printing activities as well as in our educational publishing activities.”

Financial Highlights

(1) Please refer to the “Discontinued Operations and Reclassification of Comparative Figures” section and Table #2 in the “Accounting Restatements” section of the Management’s Discussion and Analysis for an explanation of the restated data presented above.
(2) Please refer to the “Reconciliation of Non-IFRS Financial Measures” section of this Press Release for the adjusted data presented above.

Results for the First Quarter of Fiscal Year 2026

Revenues increased by $5.8 million, or 2.3%, from $257.7 million in the first quarter of fiscal year 2025 to $263.5 million in the first quarter of fiscal year 2026. This increase is mostly attributable to our recent acquisitions and the favourable exchange rate effect, partially mitigated by lower volume and price concessions in the Retail Services and Printing Sector.

Operating earnings before depreciation and amortization decreased by $10.6 million, or 28.9%, from $36.7 million in the first quarter of fiscal 2025 to $26.1 million in the first quarter of fiscal 2026. This decrease is mainly due to lower volume and price concessions in the Retail Services and Printing Sector, an increase in asset impairment charges and the unfavourable impact of incentive compensation reflecting, among others, the increase in share price, partially offset by our recent acquisitions and the favourable exchange rate effect.

Adjusted operating earnings before depreciation and amortization decreased by $7.2 million, or 17.9%, from $40.3 million in the first quarter of fiscal 2025 to $33.1 million in the first quarter of fiscal 2026. This decrease is mainly due to lower volume and price concessions in the Retail Services and Printing Sector and the unfavourable impact of incentive compensation reflecting, among others, the increase in share price, partially offset by our recent acquisitions and the favourable exchange rate effect.

Net earnings (loss) from continuing operations decreased by $5.0 million, or 104.2%, from earnings of $4.8 million in the first quarter of fiscal year 2025 to a loss of $0.2 million in the first quarter of fiscal year 2026. This decrease is mainly due to the previously explained decline in operating earnings before depreciation and amortization, partially mitigated by lower income taxes and, to a lesser extent, the decrease in financial expenses. On a per share basis, net earnings attributable to shareholders of the Corporation from continuing operations decreased by 100.0%, from $0.06 to nil, respectively.

Adjusted net earnings decreased by $1.5 million, or 18.3%, from $8.2 million in the first quarter of fiscal year 2025 to $6.7 million in the first quarter of fiscal year 2026. This decrease is mainly due to the previously explained decline in adjusted operating earnings before depreciation and amortization, partially mitigated by lower income taxes and, to a lesser extent, the decrease in financial expenses. On a per share basis, adjusted net earnings from continuing operations decreased by 20.0%, from $0.10 to $0.08, respectively.

For more detailed financial information, please see the Management’s Discussion and Analysis for the first quarter of fiscal year 2026 ended January 25, 2026, as well as the financial statements in the “Investors” section of our website at www.tc.tc.

Outlook

The closing of the sale of our Packaging Business represents a key milestone for TC Transcontinental. This transaction will allow us to focus our resources on our Retail Services & Printing and Educational Publishing activities.

We anticipate lower volume in our traditional activities, including book printing which experienced very high growth in fiscal year 2025. This decrease should be partially offset by growth in our in-store marketing activities, including the positive impact of acquisitions.

At the consolidated level, we expect adjusted operating earnings before depreciation and amortization from continuing operations for fiscal year 2026 to remain stable compared to fiscal year 2025.

Lastly, we expect to continue generating significant cash flows from operating activities, which will enable us to continue to reduce net indebtedness while investing in our growth. We also expect our adjusted net indebtedness ratio to increase over the next two quarters before improving in the fourth quarter of fiscal year 2026.

Non-IFRS Financial Measures

In this document, unless otherwise indicated, all financial data are prepared in accordance with International Financial Reporting Accounting Standards (“IFRS”) and the term “dollar”, as well as the symbol “$” designate Canadian dollars.

In addition, in this press release, we also use certain non-IFRS financial measures for which a complete definition is presented below and for which a reconciliation to financial information in accordance with IFRS is presented in the “Reconciliation of Non-IFRS Financial Measures” section and in Note 4 “Segmented Information” to the condensed interim consolidated financial statements for the first quarter ended January 25, 2026.

Reconciliation of Non-IFRS Financial Measures

The financial information has been prepared in accordance with IFRS. However, financial measures used, namely adjusted operating earnings before depreciation and amortization, adjusted operating earnings margin before depreciation and amortization, adjusted operating earnings, adjusted operating earnings margin, adjusted income taxes, adjusted net earnings from continuing operations, adjusted net earnings per share from continuing operations, net indebtedness, adjusted net indebtedness, the net indebtedness ratio and the adjusted net indebtedness ratio, for which a reconciliation is presented in the following table, are not defined by IFRS. They may be calculated differently and may not be comparable to similar measures presented by other companies. We believe that many of our readers analyze the financial performance of the Corporation’s activities based on these non-IFRS financial measures as such measures may allow for easier comparisons between periods. These measures should be considered as a complement to financial performance measures in accordance with IFRS. They do not substitute and are not superior to them.

The Corporation also believes that these measures are useful indicators of the performance of its operations and its ability to meet its financial obligations. Furthermore, management also uses some of these non-IFRS financial measures to assess the performance of its activities and managers.

(1) Amortization of intangible assets arising from business combinations includes our customer relationships, educational book titles, non-compete agreements, trade names with finite useful lives and rights of first refusal.
(2) Depreciation and amortization excludes the amortization of intangible assets arising from business combinations.

(1) Amortization of intangible assets arising from business combinations includes our customer relationships, non-compete agreements and trade names with finite useful lives.
(2) Depreciation and amortization excludes the amortization of intangible assets arising from business combinations.

(1) Amortization of intangible assets arising from business combinations includes our rights of first refusal and educational book titles.
(2) Depreciation and amortization excludes the amortization of intangible assets arising from business combinations.

(1) Amortization of intangible assets arising from business combinations includes our customer relationships, educational book titles, non-compete agreements, trade names with finite useful lives and rights of first refusal.

(1) To mitigate the impact of foreign currency fluctuations when consolidating the Packaging Sector’s earnings, the Corporation sometimes uses foreign exchange contracts. These contracts are not designated as part of a hedge accounting relationship, and resulting exchange gains or losses are added to adjusted operating earnings and adjusted operating earnings before depreciation and amortization.
(2) Amortization of intangible assets arising from business combinations include our customer relationships.
(3) Depreciation and amortization excludes the amortization of intangible assets arising from business combinations.

Dividend

Following the sale of the Packaging Business completed on March 6, 2026, and subject to the approval of some changes by the shareholders of the Corporation at the Annual and Special meeting of shareholders to be held on March 10, 2026, the Corporation intends to declare a special distribution of $20.00 per share on Class A Subordinate Voting Shares and Class B Shares.

Additional information

Conference Call

Upon releasing its results for the first quarter of fiscal year 2026, the Corporation will hold a conference call for the financial community on March 10, 2026, at 4:00 p.m. The dial-in numbers are 1-289-514-5100 or 1-800-717-1738. Media may hear the call in listen-only mode or tune in to the simultaneous audio broadcast on TC Transcontinental’s website, which will then be archived for 30 days. For media requests or interviews, please contact Laurence Boucicault, Senior Advisor, Corporate Communications of TC Transcontinental, at 438-226-0469.

Profile

Founded 50 years ago and 4,000 employees strong, Transcontinental Inc. (TSX: TCL.A TCL.B), known under the TC Transcontinental brand, is a Canadian retail marketing services company, Canada’s largest printer, and the Canadian leader in French-language educational publishing. Driven by the vision of a more informed, educated and prosperous society, TC Transcontinental propels its clients’ success across the retail, education, book and information industries. With agility, creativity and boldness, we design and deliver innovative, high-value products and services.

The Corporation’s revenues from continuing operations were $1.1 billion for the fiscal year ended October 26, 2025. Until the sale of its Packaging Sector to ProAmpac, which was completed on March 6, 2026, the Corporation was also a North American leader in flexible packaging with approximately 3,600 employees, and revenues from the Corporation’s discontinued operations were $1.6 billion for the fiscal year ended October 26, 2025. For more information, please visit www.tc.tc.

Forward-looking Statements

Our public communications often contain oral or written forward-looking statements which are based on the expectations of management and inherently subject to a certain number of risks and uncertainties, known and unknown. By their very nature, forward-looking statements are derived from both general and specific assumptions. The Corporation cautions against undue reliance on such statements since actual results or events may differ materially from the expectations expressed or implied in them. Forward-looking statements may include observations concerning the Corporation’s objectives, strategy, anticipated financial results and business outlook. The Corporation’s future performance may also be affected by a number of factors, many of which are beyond the Corporation’s will or control. These factors include, but are not limited to the impact of digital product development and adoption, the impact of changes in the participants in the distribution of newspapers and printed advertising materials and the disruption in their activities resulting mainly from labour disputes, including at Canada Post, the impact of regulations or legislation regarding door-to-door distribution on the printing of paper flyers or printed advertising materials, inflation and recession risks, economic conditions and geopolitical uncertainty, environmental risks as well as adoption of new regulations or amendments and changes to consumption habits, risk of an operational disruption that could be harmful to its ability to meet deadlines, the worldwide outbreak of a disease, a virus or any other contagious disease could have an adverse impact on the Corporation’s operations, the ability to generate organic long-term growth and face competition, a significant increase in the cost of raw materials, the availability of those materials and energy consumption could have an adverse impact on the Corporation’s activities, the ability to complete business acquisitions and disposals and properly integrate acquisitions, cybersecurity, data protection, warehousing and usage, the impact of digital product development and adoption on the demand for printed products other than flyers, the failure of patents, trademarks and confidentiality agreements to protect intellectual property, a difficulty to attract and retain employees in the main operating sectors, the safety and quality of packaging products used in the food industry, bad debts from certain customers, import and export controls, duties, tariffs or taxes, exchange rate fluctuations, increase in market interest rates with respect to its financial instruments as well as availability of capital at a reasonable cost, the legal risks related to its activities and the compliance of its activities with applicable regulations, the impact of major market fluctuations on the solvency of defined benefit pension plans, changes in tax legislation and disputes with tax authorities or amendments to statutory tax rates in force, the impact of impairment tests on the value of assets and a conflict of interest between the controlling shareholder and other shareholders. The main risks, uncertainties and factors that could influence actual results are described in the Management’s Discussion and Analysis for the fiscal year ended October 26, 2025 and in the latest Annual Information Form.

Unless otherwise indicated by the Corporation, forward-looking statements do not take into account the potential impact of non-recurring or other unusual items, nor of disposals, business combinations, mergers or acquisitions which may be announced or entered into after the date of March 10, 2026. The forward-looking statements in this press release are made pursuant to the “safe harbour” provisions of applicable Canadian securities legislation. The forward-looking statements in this release are based on current expectations and information available as at March 10, 2026. Such forward-looking information may also be found in other documents filed with Canadian securities regulators or in other communications. The Corporation’s management disclaims any intention or obligation to update or revise these statements unless otherwise required by the securities authorities.

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