Our ultimate goal is to ensure the growth and profitability of Transcontinental while promoting the common interests of its employees, customers and shareholders, the three pillars of the organization. Our strategy is based on several fundamental principles: to be the leader in the markets we serve, to have a disciplined approach to acquisitions and financial management, and to foster a culture of continuous improvement. These underlying principles, which are reflected in our Evolution 2010 business project, have served us well to date.

Having said this, Transcontinental’s mission is to help its customers identify, reach and retain their target consumers. We do this by offering products and services in printing, publishing and marketing, which include many new web-based technology platforms that our clients are increasingly using in their marketing campaigns. We plan to continue to adapt to the new realities of our customers in order to help them increase the return on their marketing dollars. In fact, our vision is to build a profitable, North American leadership position as a communications solutions provider.

Our Two-Pronged Strategy

In light of the transformations in our industries, we have re-focused our strategy in order to continue to fulfill our mission. We believe we can accomplish this using a two-pronged approach: (1) build on our existing business and (2) develop new opportunities in digital and marketing communications. That is how we believe we can maximize our growth potential over the medium and long term.

1) Build on our existing business

Throughout our history we have built a solid foundation for future growth. We have core assets that can help us grow new services: we master print-based communication products, we have strong brands and the ability to distribute relevant content with targeted multi-channel reach and we are moving towards becoming a customer centric organization, service advertisers as well as end-consumers. Below is a list of selected accomplishments in fiscal 2009:

• We started printing the San Francisco Chronicle daily paper at our new plant in Fremont, California under a 15-year contract signed in 2006 with Hearst Corporation. The project was completed on schedule and the startup was a success.
• We signed a second six-year contract with Rogers Communications for the production of its marketing products, in addition to having taken over the printing of all of the Rogers magazines in February 2009.
• We completed our capital improvements to Transcontinental Transmag, one of our newspaper printing plants, which is now equipped with state-of-the-art technology that gives us improved colour printing capacities, higher quality and more efficient production.  

In sum, our existing business is solid and generates considerable cash flow. We believe we can generate earnings above the industry average given our strong competitive position and our investments in our network of state-of-the-art printing plants.

2) Develop new opportunities in digital and marketing communications

Transcontinental derives the majority of its revenues from the marketing budgets of its customers. For the future, in addition to building on our existing business, we are developing new opportunities focused on new digital platforms, one-to-one advertising and an integrated service offering. Below is a list of our selected accomplishments in fiscal 2009:

• Signed a number of major clients who will benefit from our marketing communication services. While this new business comes from a wide range of industries, the new contracts all follow a common thread: they focus on Transcontinental’s ability to provide marketers with a comprehensive set of solutions that are developed to address customers’ diverse business needs and expand their marketing mix. Selected customers include Reader’s Digest Canada, Shopping Channel, Shoppers Drug Mart - Pharmaprix, Zellers and Purolator Courier.
• Acquired Conversys, the leading e-flyer provider for a number of Canadian retailers. The acquisition enriches Transcontinental’s existing print and interactive communications offering to major retailers. Conversys’s multi-channel marketing services enable businesses to increase sales and more effectively interact with their customers.
• Acquired Redwood Custom Communications, a North American leader in custom communications on multiple platforms and a full service marketing and communications company that creates turn-key custom publishing and branded content solutions for both print and digital. Redwood’s offering also includes data sciences, research and measurement, database marketing, variable printing, photo studio and premedia tools. This makes it an attractive complement to the services offered by Transcontinental’s Marketing Communications Sector, such as database analytics, premedia, email marketing and one-to-one marketing.
• Invested approximately $9.2 million in strategic investments in our Media sector, mainly related to our digital assets.
• Weblocal.ca, our Canada-wide search site for local communities launched in late October 2008, has continued to attract consumers over the past year and now has more than two million visitors a month. 
• The Marketing Communications Sector won a total of 25 medals at the Magnus Opus Awards and four awards at the 2009 Pearl Awards, two North American competitions which recognize excellence in content, design, digital and strategy in custom publishing.
• The mobile applications that we launched in September 2008 for the popular magazine The Hockey News have been a resounding success. The Hockey News Mobile has become a must-have companion for close to 400,000 hockey fans, who can download timely hockey scores and rich content onto their iPhone or BlackBerry. To a lesser degree, mobile apps have also been introduced for the daily paper Métro, Elle Canada, Canadian Living, Les Affaires, Finance et Investissement and Investment Executive, and the number of downloads is growing.