SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 or 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For SUPPLEMENTAL DISCLOSURE DATED OCTOBER 9, 2001
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QUEBECOR WORLD INC. (FORMERLY KNOWN AS QUEBECOR PRINTING INC.)
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(Translation of Registrant's Name into English)
612 Saint-Jacques Street, Montreal, Quebec, H3C 4M8
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(Address of Principal Executive Office)
(Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F)
Form 20-F Form 40-F X
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(Indicate by check mark whether the registrant by furnishing the information
contained in this form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.)
Yes No X
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Supplemental Disclosure
of
QUEBECOR WORLD INC.
(Formerly known as Quebecor Printing Inc.)
Filed in this Form 6-K
Documents index
1. Supplemental Disclosure dated October 9, 2001
[QUEBECOR WORLD LOGO]
QUEBECOR WORLD INC.
Supplemental Disclosure
QUEBECOR WORLD ADJUSTS EARNINGS
GUIDANCE AND WILL TAKE SPECIAL
CHARGES IN Q4 2001
FOR PUBLIC RELEASE ON OCTOBER 9, 2001
http://www.quebecorworld.com/htmen/9_0/9_0_news.asp?NewsID=245
SUPPLEMENTAL DISCLOSURE
OUTLINE
PAGE
- OVERVIEW 3
- A TRACK RECORD OF GROWTH 6
- WORLD COLOR MERGER INTEGRATION 7
- PRINT MARKET ENVIRONMENT 8
- DISCUSSION OF CONSENSUS EARNINGS 10
- FINANCIAL GUIDANCE - 2001 11
- 2001 RESTRUCTURING PLAN 12
- APPENDIX: SURVEY OF SPECIAL NON-RECURRING CHARGES 15
EXCEPT FOR HISTORICAL INFORMATION CONTAINED HEREIN, THE STATEMENTS IN THIS
RELEASE ARE FORWARD-LOOKING AND MADE PURSUANT TO THE SAFE HARBOR PROVISIONS OF
THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. FORWARD-LOOKING STATEMENTS
INVOLVE KNOWN AND UNKNOWN RISKS AND UNCERTAINTIES THAT MAY CAUSE THE COMPANY'S
ACTUAL RESULTS IN FUTURE PERIODS TO DIFFER MATERIALLY FROM FORECASTED RESULTS.
THOSE RISKS INCLUDE, AMONG OTHERS, CHANGES IN CUSTOMERS' DEMAND FOR THE
COMPANY'S PRODUCTS, CHANGES IN RAW MATERIAL AND EQUIPMENT COSTS AND
AVAILABILITY, SEASONAL CHANGES IN CUSTOMER ORDERS, PRICING ACTIONS BY THE
COMPANY'S COMPETITORS, AND GENERAL CHANGES IN ECONOMIC CONDITIONS.
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QUEBECOR WORLD 2
SUPPLEMENTAL DISCLOSURE
OVERVIEW
DESPITE THE SLOWING ECONOMY IN THE U.S. AND EUROPE RESULTING IN ADVERSE MARKET
CONDITIONS, QUEBECOR WORLD HAS GENERATED YEAR-TO-DATE OPERATING MARGINS ALMOST
EQUIVALENT TO THE RECORD LEVEL OF LAST YEAR, AND HAS GROWN DILUTED EARNINGS PER
SHARE FROM $0.93 TO $0.97.
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AUGUST YEAR-TO-DATE
(UNAUDITED) 2001 2000 % CHANGE
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Revenues $4,173 $4,270 -2.3%
Operating Income $409.9 $426.1 -3.8%
Operating Income Margin 9.8% 10.0%
Net income $151.0 $146.5 3.1%
EARNINGS PER SHARE $0.97 $0.93 4.3%
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QUEBECOR WORLD 3
SUPPLEMENTAL DISCLOSURE
OVERVIEW
HISTORICALLY, QUEBECOR WORLD EARNS MORE THAN 50% OF ITS NET INCOME IN THE LAST 4
MONTHS OF THE YEAR. THIS TREND WILL NOT MATERIALIZE IN 2001.
A RECOVERY OF THE ECONOMY AND PRINT MARKETS IS NOT EXPECTED TO OCCUR UNTIL
MID-YEAR 2002.
IN LIGHT OF THIS CONTINUING DIFFICULT ECONOMIC ENVIRONMENT, EXACERBATED BY
THE EVENTS OF SEPTEMBER 11TH, QUEBECOR WORLD HAS ANNOUNCED THE FOLLOWING:
- A REVISED EARNINGS OUTLOOK FOR THIRD QUARTER AND FULL YEAR 2001
- IMPLEMENTATION OF RESTRUCTURING INITIATIVES (THE "2001
RESTRUCTURING PLAN") WHICH WILL RESULT IN THE RECOGNITION OF
RESTRUCTURING AND OTHER CHARGES OF APPROXIMATELY $225 MILLION
DURING THE FOURTH QUARTER OF 2001.
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QUEBECOR WORLD 4
SUPPLEMENTAL DISCLOSURE
OVERVIEW
THE 2001 RESTRUCTURING PLAN TO BE IMPLEMENTED BY THE END OF 2002 CONTEMPLATES:
- CLOSURE OF 7 FACILITIES, AND PARTIAL CLOSURE OF OTHERS.
- ELIMINATION OF APPROXIMATELY 6% OF QUEBECOR WORLD'S WORKFORCE GLOBALLY,
OR APPROXIMATELY 2,500 EMPLOYEE POSITIONS.
- STREAMLINING AND RATIONALIZATION OF THE MANUFACTURING PLATFORM.
- ELIMINATING COSTS AND IMPROVING RETURNS.
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QUEBECOR WORLD 5
SUPPLEMENTAL DISCLOSURE
A TRACK RECORD OF GROWTH
- BETWEEN 1989 AND 2000, QUEBECOR WORLD HAS GROWN REVENUES AT A RATE OF 23%
AND HAS GROWN EARNINGS PER SHARE AT A RATE OF 25% ANNUALLY.
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1989 2000 CAGR
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Revenues ($ millions) $653 $6,521 23%
Diluted EPS ($)(1) 0.16 1.89 25%
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1 BEFORE RESTRUCTURING AND OTHER CHARGES
- GROWTH HAS BEEN DRIVEN LARGELY BY ACQUISITIONS AND SUCCESSFUL
INTEGRATION OF OPERATIONS. GROWTH HAS ALSO BEEN ACCOMPANIED BY
TECHNOLOGICAL LEADERSHIP, OPERATIONAL EFFICIENCY AND A CLEAR
UNDERSTANDING OF THE COST STRUCTURE REQUIRED FOR INDUSTRY
LEADERSHIP.
- QUEBECOR WORLD UNDERTAKES THE 2001 RESTRUCTURING PLAN IN ORDER TO
STRENGTHEN ITS FINANCIAL PROFILE AND IMPROVE ITS COST STRUCTURE.
- THE COMPANY'S LONGER TERM STRATEGY IS TO CONTINUE TO BE THE
LEADING INDUSTRY CONSOLIDATOR AND TO PURSUE GROWTH THROUGH A
COMBINATION OF ORGANIC, NICHE AND STRATEGIC ACQUISITION
OPPORTUNITIES.
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QUEBECOR WORLD 6
SUPPLEMENTAL DISCLOSURE
WORLD COLOR MERGER INTEGRATION
- IN OCTOBER 1999, QUEBECOR WORLD ACQUIRED WORLD COLOR PRESS FOR A TOTAL
CONSIDERATION OF $2.8 BILLION.
- MANAGEMENT FOCUSED ON INTEGRATING OPERATIONS FOR THE NEXT 18 MONTHS.
- ANNUALIZED COST SAVINGS AND SYNERGIES OF APPROXIMATELY $110 MILLION WERE
REALIZED THROUGH:
- PLANT CLOSURES
- CONSOLIDATION AND SPECIALIZATION OF PRODUCTION FACILITIES
- OTHER RESTRUCTURING INITIATIVES
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KEY PERFORMANCE 1998 2000
INDICATORS PRE-MERGER POST-MERGER % CHANGE
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Revenues ($ millions) 3,808 6,521 71%
EBITDA ($ millions) 541 1,070 98%
EBIT ($ millions) 317 725 129%
EBITDA% 14.2% 16.4%
EBIT% 8.3% 11.1%
EPS(1) $1.29 $1.89 47%
Free Cash Flow ($ millions) 125 747 498%
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1 Fully diluted, before Restructuring & other charges
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QUEBECOR WORLD 7
<Page>
SUPPLEMENTAL DISCLOSURE
PRINT MARKET ENVIRONMENT
- U.S. COMMERCIAL PRINTING SHIPMENTS THROUGH THE END OF JULY 2001 WERE DOWN 4%
VERSUS 2000 AND WERE DOWN 9% IN THE MONTH OF JULY 2001
- MAGAZINE AD PAGES ARE DOWN 11.2% FOR THE FIRST 8 MONTHS OF 2001 VERSUS THE
SAME PERIOD LAST YEAR.
- LEADING MAGAZINES ARE EXPERIENCING AD PAGE DECLINES IN EXCESS OF 20% YTD.
- SEPTEMBER 11TH IMPACT FURTHER CURTAILED AD SPENDING, PARTICULARLY GENERAL
COMMERCIAL PRINTING AND MAGAZINE AD PAGES
- SEPTEMBER'S U.S. CONSUMER CONFIDENCE INDEX SUFFERED THE LARGEST ONE-MONTH
DECLINE SINCE OCTOBER, 1990.
- MANY CATALOGERS AND DIRECT MAILERS SUSPENDED SHIPMENTS DUE TO LOW
PROBABILITY OF RESPONSE/READERSHIP FOLLOWING TERRORIST ATTACKS.
- IN-FLIGHT MAGAZINES, TRAVEL AND HOSPITALITY BROCHURES NEGATIVELY AFFECTED BY
SEPTEMBER 11TH ATTACKS.
- EUROPEAN ECONOMIES ALSO EXPERIENCING SETBACKS IN CONSUMER CONFIDENCE, WITH
NEGATIVE IMPLICATIONS FOR ADVERTISING SPENDING.
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QUEBECOR WORLD 8
SUPPLEMENTAL DISCLOSURE
PRINT MARKET ENVIRONMENT
US$ COMMERCIAL PRINTING SHIPMENTS
QUEBECOR WORLD
U.S. Commercial Printing Shipments ($Millions)
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2000 7981 8454 8768 8411 8646 8928 8466 9039 9272 9341 9227 8923
2001 8009 8301 8757 8092 8149 8086 7818
US$ COMMERCIAL PRINTING SHIPMENTS
[GRAPH HERE]
SOURCE: U.S. DEPARTMENT OF CENSUS
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QUEBECOR WORLD 9
SUPPLEMENTAL DISCLOSURE
DISCUSSION OF CONSENSUS EARNINGS
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EARNINGS PER SHARE(1),(2)
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FIRST QUARTER SECOND QUARTER THIRD QUARTER FOURTH QUARTER FULL YEAR
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EPS % EPS % EPS % EPS % EPS %
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1998 $ 0.16 +7% $ 0.31 +15% $ 0.38 +27% $ 0.44 +10% $ 1.29 +15%
1999 $ 0.18 +13% $ 0.36 +16% $ 0.43 +13% $ 0.58 +32% $ 1.55 +20%
2000 $ 0.24 +33% $ 0.40 +11% $ 0.58 +35% $ 0.69 +19% $ 1.89 +22%
2001 $ 0.27 +13% $ 0.41 +3% $ 0.57(3) -2% $ 0.70(3) +1% $ 1.96(3) +4%
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1 BEFORE RESTRUCTURING AND OTHER CHARGES.
2 DILUTED EARNINGS PER SHARE
3 EARNINGS ESTIMATES BASED ON CONSENSUS ACCORDING TO FIRST CALL, A THOMSON
COMPANY AS AT OCT 3, 2001.
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QUEBECOR WORLD 10
SUPPLEMENTAL DISCLOSURE
FINANCIAL GUIDANCE - 2001
- Q3 EPS OF $0.48 (MID-POINT OF GUIDANCE RANGE) REPRESENTS 17% DECLINE OVER Q3
2000
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IN $ MILLIONS ACTUAL EARNINGS EARNINGS
(except per share 2001 GUIDANCE GUIDANCE
data) JUNE YTD Q3 2001 YEAR 2001
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Revenues $3,079 $1,600 $6,200
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Diluted EPS(1) $0.68 $0.45 - $0.50 $1.55 - $1.65
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1 Before Restructuring & other charges
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QUEBECOR WORLD 11
SUPPLEMENTAL DISCLOSURE
2001 RESTRUCTURING PLAN
PURPOSE
- PROACTIVE MANAGEMENT RESPONSE TO WEAK MARKET CONDITIONS
- REDUCE COST STRUCTURE AND PROTECT INDUSTRY-LEADING OPERATING MARGINS
- PROTECT FINANCIAL PROFILE
- INCREASE READINESS FOR ECONOMIC RECOVERY AND NEXT STAGE OF GROWTH
SCOPE
- SIMILAR APPROACH TO SUCCESSFUL 1999 RESTRUCTURING PROGRAM
- TARGETED CLOSURE OF FACILITIES
- FURTHER CONSOLIDATION AND SPECIALIZATION OF MANUFACTURING PLATFORM
- INVESTMENT IN ROBOTICS AND OTHER PRODUCTIVITY TOOLS
- RESTRUCTURING PLAN TO BE LARGELY IMPLEMENTED BY THE END OF 2002
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QUEBECOR WORLD 12
SUPPLEMENTAL DISCLOSURE
2001 RESTRUCTURING PLAN
TOTAL ONE-TIME CHARGE OF APPROXIMATELY $225 MILLION NECESSARY UNDER CURRENT
MARKET CONDITIONS TO PROTECT OPERATING MARGINS AND ACHIEVE EFFICIENCY LEVELS
TYPICAL OF QUEBECOR WORLD .
- CASH COSTS : $100 MILLION (APPROX.)
- PLANT CLOSURES
- SEVERANCE
- REAL ESTATE AND OTHER COMMITMENTS
- NON-CASH COSTS : $125 MILLION (APPROX.)
- WRITE-DOWN OF INVESTMENTS AND OTHER ASSETS (INCL. IDLED ASSETS)
- INCREMENTAL PROVISION FOR BAD DEBT EXPENSE
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QUEBECOR WORLD 13
SUPPLEMENTAL DISCLOSURE
2001 RESTRUCTURING PLAN
ECONOMICS OF RESTRUCTURING
- $100 MILLION CASH INVESTMENT
- EXPECT $45 MILLION ANNUALIZED COST SAVINGS BY 2002
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1999 Plan 2001 Plan
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Plant Closures 11 7
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Employee Positions 3400 2500
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Target Cost Savings and Synergies (annual) 50 45
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Realized Cost Savings and Synergies (annual) 110 TBD
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EPS Impact (annual) $0.53 $0.25
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Restructuring and other special charges ($M) $180 $225
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Cash costs ($M) $143 $100
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Implementation Period (months) 18 15
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QUEBECOR WORLD 14
APPENDIX
SUPPLEMENTAL DISCLOSURE
SURVEY OF SPECIAL NON-RECURRING CHARGES
CANADIAN MARKET
SUMMARY OF SPECIAL NONRECURRING CHARGES(1)
(IN $ MILLION, C$ FOR CANADIAN COMPARISON GROUP AND US$ FOR US COMPARISON GROUP & IQW)
LAST TWELVE MONTHS
------------------------------------------- ENTERPRISE
REVENUE EBITDA TOTAL ASSETS VALUE
Total sample of Canadian companies(2)
Average (111 Companies) 3,873 693 4,567 4,339
Canadian Comparison Group(3)
Average (36 Companies) 3,603 567 4,460 3,926
UNUSUAL PRE-TAX CHARGE AS %(4) (7.9%) (35.1%) (5.6%) (6.3%)
US Comparison Group
Average (132 Companies) 8,586 1,582 9,526 9,657
UNUSUAL PRE-TAX CHARGE AS % (3.1%) (20.3%) (3.0%) (3.2%)
Quebecor World
Current 6,421 1,044 6,417 5,887
PRE-TAX CHARGE AS % ( 3.5%) (21.6%) (3.5%)) (3.8%)
Source for Comparison group data : Quebecor World research
(1) Pre-tax charges related to on- going operations.
(2) Includes a sample of comparable Canadian companies
(3) Canadian companies having taken a special non- recurring charge in the
last 12 months.
(4) Excludes outliers
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QUEBECOR WORLD 15
[QUEBECOR WORLD LOGO]
QUEBECOR WORLD
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QUEBECOR WORLD 16
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
QUEBECOR WORLD INC.
By: /s/ Marie D. Hlavaty
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Name: Marie D. Hlavaty
Title: Vice President, General Counsel & Secretary
Date: October 10, 2001