UPDATE 1-Transcontinental Inc's adjusted profit rises on acquisition

Wed Mar 13, 2013 8:15am EDT
 
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* First-quarter adj EPS C$0.37 vs C$0.33 year earlier

* Revenue rises 8 percent

* Says weak ad spending will continue to hurt media business

March 13 (Reuters) - Transcontinental Inc, Canada's largest commercial printer, reported a 5 percent rise in first-quarter adjusted profit as the acquisition of Quad/Graphics Canada helped reduce the impact of the loss of a contract with retailer Zellers.

Transcontinental, which has a contract to print the Globe and Mail newspaper in most of its major markets in Canada until 2028, said benefits from the Quad/Graphics acquisition would continue in the current and the next quarter.

The company said agreements to print flyers and marketing products worth about C$30 million on an annualized basis are expected to start at the end of this quarter.

Transcontinental lost the Zellers flyer printing and distribution contract due to the closure of the Zellers stores.

Zellers, a Canadian chain of mass merchandise discount stores and a unit of Canadian retailer Hudson's Bay Co, said last year that it would close all its stores by March 2013.

Weak advertising spending would continue to be a drag on the media business, the company said. Transcontinental's media unit publishes magazines, community newspapers and French-language educational resources.   Continued...