Transcontinental (TCL-A) investor relations material

Executive summary

• Q3 2026 revenues rose 3.8% to $306.0 million, with adjusted EBITDA up 4.1% to $60.9 million, driven by ISM acquisitions, raddar rollout, and cost reductions.

• Net earnings from continuing operations increased 183.8% to $36.9 million ($0.44 per share), supported by gains from asset sales and lower impairment charges.

• The sale of the Packaging Sector for $2.1 billion enabled a strategic focus on in-store marketing and educational publishing, with a special $20.00 per share distribution paid.

• Net debt ratio improved to 2.06x, with a target of 1.75x by year-end, aided by $36.5 million from building sales.

• Transformation momentum continues, with ongoing investments in technology, operational efficiency, and growth initiatives.

Financial highlights

• Q3 2026 revenues were $306.0 million, up 3.8% year-over-year, mainly due to ISM acquisitions and raddar rollout, partially offset by lower traditional volumes.

• Adjusted EBITDA rose 4.1% to $60.9 million; operating earnings before depreciation and amortization increased 81.6% to $85.7 million, mainly from building sales and lower restructuring costs.

• Adjusted EPS from continuing operations was $0.32, up 18.5% from $0.27 in Q3 last year; net earnings from continuing operations rose 183.8% to $36.9 million.

• Net financial expense increased by $5.3 million due to a $12 million FX loss related to the Packaging Sector sale.

• Adjusted income tax rose by $3.7 million to $14.4 million, with an effective rate of 32.3%.

Outlook and guidance

• Adjusted EBITDA for FY2026 is expected to remain stable versus FY2025, with improved Q4 performance and significant operating cash flows anticipated to reduce net debt.

• Lower volumes in traditional activities are expected to be offset by growth in ISM, specialty activities, and acquisitions.

• CapEx expected to be around $60 million for the full year.

• Targeting net debt/EBITDA ratio of 1.75x by year-end.