Corus Entertainment announces first quarter results



    
    -   Earnings per share of $0.94 for first quarter, up 8% from prior year
    -   Combined Radio and Television revenues up 4% for first quarter
    -   Segment profit of $83 million, up 4% for first quarter
    

    TORONTO, Jan. 9 /CNW/ - Corus Entertainment Inc. (TSX: CJR.B; NYSE:   CJR)
announced its first quarter financial results today, led by continued revenue
growth from its broadcasting businesses.

    "We executed well on our operating strategies and delivered solid
increases in revenues and segment profit," said John Cassaday, President and
CEO of Corus Entertainment Inc. "In Q1, we invested in programming and
marketing to continue our growth momentum. These solid results were in line
with our expectations and our continued confidence in our business has enabled
us to once again substantially increase our dividend. We are also pleased to
have announced our intention to extend our share buyback program."

    First Quarter Results
    ---------------------

    Consolidated revenues for the first quarter ended November 30, 2007 were
$214.8 million, up 3% from $209.2 million last year. Consolidated segment
profit was $83.4 million, up 4% from $79.9 million last year. Net income for
the quarter was $39.4 million ($0.94 basic and $0.91 diluted), up 7% compared
to net income of $36.7 million ($0.87 basic and $0.85 diluted) last year.

    Corus Television contributed quarterly revenues of $126.1 million, up 3%
from $122.6 million last year, led by specialty advertising growth of 2% and
subscriber revenue growth of 4%. Quarterly segment profit increased to
$62.9 million, up 4% from $60.5 million last year.

    Corus Radio revenues were $79.5 million, up 5% from $75.6 million last
year. Segment profit was $25.5 million, up 8% from $23.6 million last year.

    Corus Content revenues were $9.6 million, down 19% from $11.7 million
last year. Segment profit was $0.5 million, compared to $1.0 million last
year.

    Corus has continued to purchase shares under its Normal Course Issuer Bid
announced in fiscal 2006 and renewed in February 2007. In the first quarter of
fiscal 2008, the Company purchased for cancellation 659,900 Class B Non-Voting
Shares at an average price of $49.01 per share. In December 2007, a further
125,300 Class B Non-Voting Shares were purchased and cancelled.

    Corus Entertainment Inc. reports in Canadian dollars.

    About Corus Entertainment Inc.

    Corus Entertainment Inc. is a Canadian-based media and entertainment
company. Corus is a market leader in specialty television and radio with
additional assets in pay television, advertising and digital audio services,
television broadcasting, children's book publishing and children's animation.
The company's multimedia entertainment brands include YTV, Treehouse,
W Network, Movie Central, Nelvana, Kids Can Press and radio stations including
CKNW, CKOI and Q107. Corus creates engaging branded entertainment experiences
for its audiences across multiple platforms. A publicly traded company, Corus
is listed on the Toronto (CJR.B) and New York (CJR) exchanges. Experience
Corus on the web at www.corusent.com.

    The unaudited consolidated financial statements and accompanying notes
for the quarter ended November 30, 2007 and Management's Discussion and
Analysis are available on the Company's website at
http://www.corusent.com/corporate/investor_information/press_releases.asp.

    A conference call with Corus senior management is scheduled for
January 9, 2008 at 9 a.m. ET / 8 a.m. CT / 7 a.m. MT / 6 a.m. PT. While this
call is directed at analysts and investors, members of the media are welcome
to listen in. The dial-in number for the conference call is (866) 322-2356
(North America) or (416) 640-3405 (International). PowerPoint slides for the
call will be posted at 8:45 a.m. ET on January 9, 2008 and can be found on the
Corus Entertainment website at:
http://www.corusent.com/corporate/investor_information/index.asp.

    This statement contains forward-looking information and should be read
subject to the following cautionary language:

    To the extent any statements made in this report contain information that
is not historical, these statements are forward-looking statements and may be
forward-looking information within the meaning of applicable securities laws
(collectively, "forward-looking statements"). These forward-looking statements
related to, among other things, our objectives, goals, strategies, intentions,
plans, estimates and outlook, including advertising, program, merchandise and
subscription revenues, operating costs and tariffs, taxes and fees, and can
generally be identified by the use of the words such as "believe",
"anticipate", "expect", "intend", "plan", "will", "may" and other similar
expressions. In addition, any statements that refer to expectations,
projections or other characterizations of future events or circumstances are
forward-looking statements. Although Corus believes that the expectations
reflected in such forward-looking statements are reasonable, such statements
involve risks and uncertainties and undue reliance should not be placed on
such statements. Certain material factors or assumptions are applied in making
forward-looking statements, including without limitation factors and
assumptions regarding advertising, program, merchandise and subscription
revenues, operating costs and tariffs, taxes and fees and actual results may
differ materially from those expressed or implied in such statements.
Important factors that could cause actual results to differ materially from
these expectations include, among other things: our ability to attract and
retain advertising revenues; audience acceptance of our television programs
and cable networks; our ability to recoup production costs, the availability
of tax credits and the existence of co-production treaties; our ability to
compete in any of the industries in which we do business; the opportunities
(or lack thereof) that may be presented to and pursued by us; conditions in
the entertainment, information and communications industries and technological
developments therein; changes in laws or regulations or the interpretation or
application of those laws and regulations; our ability to integrate and
realize anticipated benefits from our acquisitions and to effectively manage
our growth; our ability to successfully defend ourselves against litigation
matters arising out of the ordinary course of business; and changes in
accounting standards. Additional information about these factors and about the
material assumptions underlying such forward-looking statements may be found
in our Annual Information Form. Corus cautions that the foregoing list of
important factors that may affect future results is not exhaustive. When
relying on our forward-looking statements to make decisions with respect to
Corus, investors and others should carefully consider the foregoing factors
and other uncertainties and potential events. Unless otherwise required by
applicable securities laws, we disclaim any intention or obligation to
publicly update or revise any forward-looking statements whether as a result
of new information, events or circumstances that arises after the date thereof
or otherwise.


    
                          CORUS ENTERTAINMENT INC.
                         CONSOLIDATED BALANCE SHEETS

                                                                     As at
    (unaudited)                                   November 30,     August 31,
    (in thousands of Canadian dollars)                2007            2007
    -------------------------------------------------------------------------
    ASSETS
    Current
    Cash and cash equivalents                         11,847          33,347
    Accounts receivable                              185,936         151,380
    Prepaid expenses and other                        13,234          10,921
    Program and film rights                          127,555         125,068
    Future tax asset                                  10,140          13,518
    -------------------------------------------------------------------------
    Total current assets                             348,712         334,234
    -------------------------------------------------------------------------

    Tax credits receivable                            23,435          16,875
    Investments and other assets                      19,383          17,492
    Property, plant and equipment, net                76,369          78,342
    Program and film rights                          101,106          90,687
    Film investments                                  69,869          66,593
    Deferred charges                                       -           4,100
    Broadcast licenses                               532,812         532,812
    Goodwill                                         795,817         795,832
    -------------------------------------------------------------------------
                                                   1,967,503       1,936,967
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES AND SHAREHOLDERS' EQUITY
    Current
    Accounts payable and accrued liabilities         173,914         166,083
    Income taxes payable                              11,476           1,474
    -------------------------------------------------------------------------
    Total current liabilities                        185,390         167,557
    -------------------------------------------------------------------------

    Long-term debt                                   626,482         610,697
    Other long-term liabilities                       57,568          64,773
    Future tax liability                             104,039         102,851
    Non-controlling interest                          14,813          15,196
    -------------------------------------------------------------------------
    Total liabilities                                988,292         961,074
    -------------------------------------------------------------------------

    SHAREHOLDERS' EQUITY
    Share capital                                    875,052         882,244
    Contributed surplus                               11,534          10,250
    Retained earnings                                104,578          95,568
    Accumulated other comprehensive loss             (11,953)        (12,169)
    -------------------------------------------------------------------------
    Total shareholders' equity                       979,211         975,893
    -------------------------------------------------------------------------
                                                   1,967,503       1,936,967
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



                          CORUS ENTERTAINMENT INC.
                      CONSOLIDATED STATEMENTS OF INCOME

    (unaudited)                                          Three months ended
    (in thousands of Canadian dollars                       November 30,
     except per share amounts)                          2007            2006
    -------------------------------------------------------------------------
    Revenues                                         214,825         209,198
    Direct cost of sales, general and
     administrative expenses                         131,435         129,281
    Depreciation                                       5,769           5,166
    Amortization                                           -             566
    Interest expense                                  10,989           8,872
    Other expense, net                                 3,887           6,522
    -------------------------------------------------------------------------
    Income before income taxes and
     non-controlling interest                         62,745          58,791
    Income tax expense                                22,138          20,638
    Non-controlling interest                           1,220           1,484
    -------------------------------------------------------------------------
    Net income for the period                         39,387          36,669
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Earnings per share

      Basic                                            $0.94           $0.87
      Diluted                                          $0.91           $0.85
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



               CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

                                                         Three months ended
    (unaudited)                                             November 30,
    (in thousands of Canadian dollars)                  2007            2006
    -------------------------------------------------------------------------
    Net income for the period                         39,387          36,669
    Other comprehensive income (loss), net of tax
      Unrealized foreign currency translation
       adjustment                                       (972)            621
      Unrealized change in fair value of
       available-for-sale investments                    183               -
      Unrealized change in fair value of cash flow
       hedges                                         (6,002)              -
    -------------------------------------------------------------------------
                                                      (6,791)            621
    -------------------------------------------------------------------------
    Comprehensive income for the period               32,596          37,290
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



                          CORUS ENTERTAINMENT INC.
          CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

                                                         Three months ended
    (unaudited)                                             November 30,
    (in thousands of Canadian dollars)                  2007            2006
    -------------------------------------------------------------------------
    Share capital
    Balance, beginning of period                     882,244         870,563
    Issuance of shares under Stock Option Plan         6,768           2,371
    Shares repurchased                               (13,960)           (821)
    -------------------------------------------------------------------------
    Balance, end of period                           875,052         872,113
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Contributed surplus
    Balance, beginning of period                      10,250           6,878
    Stock-based compensation                           1,869             918
    Exercise of stock options                           (585)           (223)
    -------------------------------------------------------------------------
    Balance, end of period                            11,534           7,573
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Retained earnings
    Balance, beginning of period                      95,568          51,585
    Cumulative impact of accounting changes           (1,594)              -
    -------------------------------------------------------------------------
    Adjusted opening balance                          93,974          51,585
    Net income for the period                         39,387          36,669
    Dividends                                        (10,403)         (9,041)
    Share repurchase excess                          (18,380)           (762)
    -------------------------------------------------------------------------
    Balance, end of period                           104,578          78,451
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Accumulated other comprehensive loss
    Balance, beginning of period                     (12,169)        (11,528)
    Cumulative impact of accounting changes            7,007               -
    -------------------------------------------------------------------------
    Adjusted opening balance                          (5,162)        (11,528)
    Other comprehensive income (loss)                 (6,791)            621
    -------------------------------------------------------------------------
    Balance, end of period                           (11,953)        (10,907)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



                          CORUS ENTERTAINMENT INC.
                    CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                         Three months ended
    (unaudited)                                             November 30,
    (in thousands of Canadian dollars)                  2007            2006
    -------------------------------------------------------------------------
    OPERATING ACTIVITIES
    Net income for the period                         39,387          36,669
    Add non-cash items:
      Depreciation                                     5,769           5,166
      Amortization of program and film rights         36,077          32,201
      Amortization of film investments                 4,916           7,868
      Other amortization                                   -             566
      Future income taxes                              4,921           2,718
      Non-controlling interest                         1,220           1,484
      Stock-based compensation                         2,884           1,919
      Other                                            2,538             730
    Net change in non-cash working capital
    balances related to operations                   (33,683)        (24,976)
    Payment of program and film rights               (42,297)        (37,946)
    Net additions to film investments                (17,744)        (14,386)
    -------------------------------------------------------------------------
    Cash provided by operating activities              3,988          12,013
    -------------------------------------------------------------------------

    INVESTING ACTIVITIES
    Additions to property, plant and equipment        (4,219)         (5,492)
    Business combinations                                332         (46,645)
    Net change in other investments and assets        (1,135)             54
    Decrease in public benefits associated with
     acquisitions                                     (1,896)         (1,258)
    -------------------------------------------------------------------------
    Cash used in investing activities                 (6,918)        (53,341)
    -------------------------------------------------------------------------

    FINANCING ACTIVITIES
    Increase in bank loans                            19,828          49,627
    Decrease in other long-term liabilities             (158)           (168)
    Issuance of shares under stock option plan         6,183           2,148
    Shares repurchased                               (32,340)         (1,583)
    Dividends paid                                   (10,480)         (9,039)
    Dividend paid to non-controlling interest         (1,603)              -
    -------------------------------------------------------------------------
    Cash provided by (used in) financing activities  (18,570)         40,985
    -------------------------------------------------------------------------

    Decrease in cash and cash equivalents during
     the period                                      (21,500)           (343)
    Cash and cash equivalents, beginning of period    33,347          43,636
    -------------------------------------------------------------------------
    Cash and cash equivalents, end of period          11,847          43,293
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



                          CORUS ENTERTAINMENT INC.
                        BUSINESS SEGMENT INFORMATION

    Three months ended November 30, 2007

                                  Tele-                       Elimi- Consoli-
                          Radio  vision  Content  Corporate  nations  dated
    -------------------------------------------------------------------------
    Revenues             79,525  126,119    9,557        -     (376) 214,825
    Direct cost of
     sales, general
     and administrative
     expenses            54,054   63,250    9,086    5,646     (601) 131,435
    -------------------------------------------------------------------------
    Segment profit       25,471   62,869      471   (5,646)     225   83,390
    Depreciation          1,419    2,626       36    1,688        -    5,769
    Interest expense        247      874      643    9,225        -   10,989
    Other expense, net      (34)   3,459      753     (291)       -    3,887
    -------------------------------------------------------------------------
    Income before
     income taxes and
     non-controlling
     interest            23,839   55,910     (961) (16,268)     225   62,745
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Three months ended November 30, 2006

                                  Tele-                       Elimi- Consoli-
                          Radio  vision  Content  Corporate  nations  dated
    -------------------------------------------------------------------------
    Revenues             75,591  122,641   11,746        -     (780) 209,198
    Direct cost of
     sales, general
     and administrative
     expenses            51,942   62,159   10,739    5,398     (957) 129,281
    -------------------------------------------------------------------------
    Segment profit       23,649   60,482    1,007   (5,398)     177   79,917
    Depreciation          1,369    2,810       25      962        -    5,166
    Amortization              -      266        -      300        -      566
    Interest expense        230       39       90    8,513        -    8,872
    Other expense, net      435    5,416    1,222     (551)       -    6,522
    -------------------------------------------------------------------------
    Income before
     income taxes and
     non-controlling
     interest            21,615   51,951     (330) (14,622)     177   58,791
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

    %SEDAR: 00013131EF          %CIK: 0001100868




For further information:

For further information: John Cassaday, President and Chief Executive
Officer, Corus Entertainment Inc., (416) 642-3770; Tom Peddie, Senior Vice
President and Chief Financial Officer, Corus Entertainment Inc., (416)
642-3780; Tracy Ewing, Vice President, Communications, Corus Entertainment
Inc., (416) 642-3792


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