Corus Entertainment Inc.

Overview Key strengths Key risks Second-largest media company in Canada Exposure to economic cyclicality as over 60% of revenue comes from advertising Strong subscriber penetration and ratings performance in specialty television focused on women and children Risk of secular decline across media industry remains elevated, which could slow deleveraging Strengthening presence on streaming platforms both live and video on demand (VOD) that continues to partially offset TV subscriber loss S&P Global Economics forecasts Canadian GDP will expand in the low-to-mid single-digit percentage area in 2022 and 2023 aided by improving health situation amid vaccination progress, improved mobility, reinvigorated demand for services, and stronger hiring. S&P Global Ratings also forecasts global advertising will grow well ahead of GDP, led by continued

...A sustained recovery in traditional advertising and growth in digital advertising should support low-single-digit revenue growth in 2022. S&P Global Economics forecasts Canadian GDP will expand in the low-to-mid single-digit percentage area in 2022 and 2023 aided by improving health situation amid vaccination progress, improved mobility, reinvigorated demand for services, and stronger hiring. S&P Global Ratings also forecasts global advertising will grow well ahead of GDP, led by continued digital ad-spending growth. Therefore, we expect Corus Entertainment Inc.'s TV advertising revenues will increase in the low-to-mid single-digit percentage area assisted by increased use of digitized data-driven advertising technology (audience segment selling initiatives and automated buying platform Cynch and dynamic advertising insertion within VOD). The company's use of digital advertising platforms reflects the ongoing transition to more targeted and automated offerings from traditional advertising...

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