Highlights for the Period

Consolidated revenue was $45.7 million for the period, down $0.6 million or 1.2%. Consolidated EBITDA was $2.3 million for the period, up $0.8 million or 52.4% from the prior year. 

Including the Company’s share of joint ventures and associates, revenue was $56.6 million, down $3.5 million or 5.8% and EBITDA was $4.1 million, down $0.8 million or 16.4%. The decreases were partially the result of the sale of Fundata in April 2019. 

The Company continues to make progress in its key growth areas in business information and digital media, which are offsetting expected print revenue declines, as demonstrated by the overall revenue performance. Revenue has also been positively impacted by the acquisition of Castanet. Digital focused businesses typically have higher margins and higher valuations than print revenue businesses once sufficient scale is achieved, so the Company can achieve higher value with lower consolidated revenue going forward. However, continued investment in product development and softness in print media community advertising are still constraining EBITDA growth. 

During the quarter, the Company acquired the assets of Castanet Media Ltd. (“Castanet”) and related radio assets. The purchase price was $22.0 million for the Castanet assets and $2.0 million for the shares of the company that owns the radio station. $19.0 million was paid at closing and the remainder is payable over two years. The acquisition of the radio station shares is subject to Canadian Radio-television and Telecommunications Commission approval. The acquisition of Castanet bolsters the Company’s digital media presence. 

During the quarter, the Company sold its 50% interest in Fundata for a sale price of $55.0 million. $45.0 million of the sale price was received at closing and $10.0 million is receivable over four years through a vendor take-back. As a result of the sale, the Company was able to repay the term loan and a portion of the revolving loan, significantly reducing overall debt levels. The purchase price highlights the value of the data, analytics and intelligence products and services the Company owns and is focused on. These products and services provide high value to their users through the nature of their data and functionality, and fulfill a high level of need. They also generate strong recurring revenue and cash flows.

During the quarter, the Company borrowed $10.0 million through an unsecured loan that was arranged from Madison Venture Corporation (“Madison”) in order to provide certainty of funding for the Castanet acquisition and allow greater financial flexibility compared to increased senior debt borrowing. It was not clear while the Castanet acquisition was being pursued and negotiated that the Fundata disposition would occur, and certainty of financing was required for the Castanet acquisition to be undertaken on an exclusive and confidential basis. During the quarter, the Company repaid $6.0 million of the unsecured loan, with $4.0 million outstanding at June 30, 2019. Subsequent to June 30, 2019, the Company repaid the remaining $4.0 million. The unsecured loan was repaid and replaced with senior debt to reduce the overall cost of borrowing

Subsequent to June 30, 2019, the Company completed a private placement of 15,384,615 common shares at a price of $0.65 per share for gross proceeds of $10.0 million. The net proceeds of the Private Placement were initially used to reduce the overall debt level, but ultimately shall be used for investment purposes and general working capital needs. The Private Placement will allow the Company to pursue strategic investments as they arise to increase its scale, competitiveness and operating strength while maintaining lower debt levels.  

Operational Overview

ERIS experienced strong growth in both Canada and the U.S., with significant new customer additions and renewals including new mid-sized customers in the U.S. market. REW, the Company’s online real estate portal, continues to grow in terms of site features, traffic and revenues. Revenue grew despite the slower real estate conditions in the Vancouver market; however, growth was bolstered by the market in Toronto which continues to strengthen.

Conditions in the agricultural market continue to be soft amid uncertainty from trade disputes and the consolidation of major crop input companies. These adverse conditions weighed on second quarter performance. The Company did, however, continue to invest in and see solid growth in key agricultural information operations such as outdoor shows and online listings. 

The energy group remains stable for the period after the substantial restructurings enacted over the last two years. The Company’s mining operations, the Northern Miner and Infomine, operated in choppy market conditions. 

Community media print advertising revenues declined as anticipated, while digital revenues grew substantially. It is becoming apparent that a viable long-term digital community media business model exists where the Company can leverage its broad presence in local markets across Western Canada and offer local websites, digital marketing services and specialty digital products. Additionally, the acquisition of Castanet will have a positive effect on digital revenue growth going forward.

The Company is investing in the digital business by hiring and training to broaden our skills and experience base in line with market needs and opportunities, as well as product and services development. 


The Company continues to find meaningful growth opportunities in each of its sectors with which to increase value, and is achieving market traction in each one. 

Management will focus on making progress in its growth areas, improving profitability and reducing debt further in order to maintain financial flexibility and be in a position to exploit opportunities should they arise.