Transcontinental (TCL-A) investor relations material

Executive summary

• Revenues for Q1 2026 were $263.5 million, up 2.3% year-over-year, driven by acquisitions and favorable exchange rates, partially offset by lower volumes and price concessions.

• Adjusted EBITDA declined by $7.2 million (17.9%) to $33.1 million, mainly due to lower volumes and price concessions in Retail Services & Printing, and higher incentive compensation.

• Adjusted EPS from continuing operations was $0.08, down from $0.10 in Q1 last year; EPS was $0.00, down from $0.06.

• Sale of the Packaging business completed March 6, 2026, for $2.1 billion, enabling a strategic focus on retail services, printing, and educational publishing.

• Leadership transition announced: Sam Bendavid to become CEO, Pat Brayley as COO, and Patrick Lutzy continues as president of educational publishing.

Financial highlights

• Revenues from continuing operations increased 2.3% year-over-year to $263.5 million, mainly due to acquisitions and favorable exchange rates.

• Adjusted EBITDA declined to $33.1 million from $40.3 million year-over-year.

• Adjusted net earnings from continuing operations were $6.7 million ($0.08 per share), down from $8.2 million ($0.10 per share) year-over-year.

• Net financial expenses decreased by $0.4 million to $9.3 million, reflecting lower debt levels.

• Working capital usage improved to $10.8 million from $36.4 million in Q1 last year, mainly due to lower inventory.

Outlook and guidance

• Adjusted EBITDA expected to be below last year in Q2, with recovery anticipated in the second half as cost reductions and profit improvement initiatives take effect.

• Adjusted operating earnings before depreciation and amortization for FY2026 expected to remain stable versus FY2025.

• Adjusted net indebtedness ratio expected to rise in the next two quarters before improving in Q4 2026.

• Corporate cost savings of approximately $30 million targeted over two years, with some impact in the second half and full run rate expected next year.

• Continued focus on stabilizing flyer business and growing ISM through organic growth and acquisitions.