Transcontinental Has Strong Profitability Gain on Lower Revenue in Q1

• In light of the major structural changes in our industry and the inevitable consolidation underway in a number of segments, on February 10, 2010, Transcontinental announced that it had signed an agreement to sell most of its direct mail assets in the United States to IWCO Direct, a company headquartered in Minnesota, USA. The transaction, which must be approved by regulators, will generate net proceeds of more than US$100.0 million and is expected to close in our second quarter. This decision reflects management’s plan to focus its energies on core operations and to emphasize the development of its digital products and services. Note that Transcontinental remains the leader in direct marketing in Canada.