Annual Report 2009-2010 [PDF]

THE OLD RULES NO LONGER APPLY: RESHAPING CANADIAN PUBLIC BROADCASTING CBC | RADIO-CANADA ANNUAL REPORT 2009–2010 PROGRAMMING THE FINANCIALS IN SUCCESSES AN UNCERTAIN TIME ENGLISH SERVICES THE CHALLENGE ■■ CBC■Radio■One■and■CBC■Radio■2■achieved■a■ ■■ CBC■|■Radio-Canada’s■net■loss■of■$58.3■million■in■ combined■national■audience■share■–■13.8■per■cent■ 2009-2010■is■primarily■explained■by■weak■advertising■ (Fall■survey,■Canadians■12■years■of■age■and■older),■ revenues■that■were■unable■to■compensate■for■ with■CBC■Radio■One■matching■its■all-time■high■of■■ programming■cost■increases. 11.1■per■cent. ■■ The■Corporation■prudently■managed■its■resources■ ■■ In■measured■major■English-speaking■markets,■21■of■ in■2009-2010■and■will■continue■to■do■so■in■order■to■ 22■CBC■Radio■One■local■morning■shows■were■ranked■ ensure■financial■sustainability■within■this■environment■ first,■second■or■third■(Fall■2009■survey). of■uncertain■revenues■and■increasing■production■costs. ■■ CBC■Television’s■2+■regular■season,■prime-time■ THE RESPONSE audience■share■of■9.3■per■cent■was■up■from■last■ ■■ CBC■|■Radio-Canada■developed■a■Recovery■Plan,■ year’s■8.6■per■cent,■and■its■share■of■25-54■year-olds■ cancelled■or■scaled■back■programming■across■our■ rose■from■7.0■per■cent■to■8.0■per■cent.■The■network’s■ networks,■and■eliminated■approximately■800■full-time■ predominantly■Canadian■prime-time■schedule■ positions,■triggering■$36■million■in■downsizing■costs.■ continued■to■beat■a■key■competitor’s■primarily■ The■Corporation■also■sold■$153■million■of■long-term■ American■prime-time■schedule. accounts■receivable. ■■ CBC.ca■–■Canada’s■most■popular■English-language■ ■■ Together,■these■actions■allowed■CBC■|■Radio-Canada■to■ news■and■media■site■averaged■4.8■million■unique■ achieve■cost■reductions■related■to■operations. visitors■monthly. ■■ In■recent■months,■the■diminished■advertising■market■ FRENCH SERVICES has■been■slowly■recovering■to■pre-recessionary■levels,■ ■■ Radio-Canada■strengthened■its■regional■presence■by■ but■remains■fragmented. opening■two■new■integrated■stations■in■Sherbrooke■ THE FUTURE and■Trois-Rivières,■giving■residents■of■Mauricie■and■ ■■ CBC■|■Radio-Canada■will■continue■to■focus■on■our■three■ the■Eastern■Townships■access■to■local■news■and■ corporate■priorities: programming■everyday. PEOPLE –■our■key■asset. ■■ Première■Chaîne■morning■shows■in■Montréal,■■ PROGRAMS Québec■City■and■Ottawa■ranked■second■or■third■in■ ■–■our■core■competency. fiercely■competitive■regions. PUSHING FORWARD –■we■will■adapt■to■■ ■ ■■ Two■of■Radio-Canada’s■Twitter■channels■ranked■ ■ challenges■and■exploit■opportunities. among■the■Québec■top■10. ■■ We■are■completing■a■strategic■planning■process,■ ■■ Launched■in■January■2010,■TOU.TV■is■Canada’s■ Driving■Towards■2015,■which■will■bring■more■ largest■French-language■entertainment■Web■television■ clarity■to■our■decision■making■and■allocation■of■ site,■recording■over■745,000■connections■in■its■first■ scarce■resources,■for■the■purpose■of■better■serving■ week.■It■now■reaches■over■half■a■million■unique■ Canadians■with■high-quality■content■whenever,■ French-speaking■visitors,■for■a■seven■per■cent■reach. wherever■and■however■they■want■it.■This■will■allow■ us■to■become■an■even■more■successful■and■vibrant■ OTHER BROADCASTING ACTIVITIES national■public■broadcaster. ■■ CBC■News■Express/RDI■Express,■the■Corporation’s■ bilingual■news■and■information■service■for■airports,■ launched■in■Winnipeg■and■Edmonton,■augmenting■its■ service■in■Ottawa,■Toronto■and■Vancouver. ■■ Sirius■Canada,■in■which■the■Corporation■is■a■partner,■ completed■the■year■with■over■one■million■subscribers.■ CBC■|■Radio-Canada■has■six■channels■on■Sirius■Canada. For the year ended March 31 2010 2009 (thousands of dollars) GOVERNMENT FUNDING AND REVENUES Parliamentary appropriation for operating expenditures 1,017,587 1,070,137 Amortisation of deferred capital funding and working capital 125,086 115,355 Advertising revenues 309,255 356,248 Other income, financing income and specialty services 258,426 255,904 Total 1,710,354 1,797,644 EXPENSES Television, radio and new media services costs 1,461,849 1,475,919 Other 328,370 371,795 Total 1,790,219 1,847,714 Non-operating revenues 21,566 34,374 Net results for the year (58,299) (15,696) 2009–2010: HIGHLIGHTS OF THE YEAR TABLE OF CONTENTS Highlights of the Year pg. ii / Message from the Chair pg. 02 / Message from the President and CEO pg. 04 / Board of Directors and Senior Executive Team pg. 10 / Board of Directors Yearly Attendance pg. 11 / Governance pg. 12 / Public Accountability pg. 14 / 2009–2010 Highlights pg. 18 / CBC | Radio-Canada Services pg. 24 / Management Discussion and Analysis pg. 28 / Key Performance Indicators pg. 30 / Media Lines’ Targets and Results pg. 34 / Financial Review pg. 42 / Management’s Responsibility Statement pg. 68 / Auditor’s Report pg. 69 / Consolidated Financial Statements pg. 70 / NEW REALITIES REQUIRE NEW APPROACHES: RISING TO THE CHALLENGE See photo legends on page 107. | Message froM the Chair t he Board of direCtors The Board put considerable effort into individual and group outreach activities across the country has played an in 2009–2010. These community gatherings and round table discussions were designed to iMportant role during provide information to the public and to targeted stakeholders on CBC | Radio‑Canada’s activities and a very unCertain and to solicit feedback from Canadians. diffiCult fisCal year CBC | Radio‑Canada held its first annual public meeting in Ottawa on September 23, 2009. to MarCh 31, 2010. During the meeting, members of the Board and Along with guiding CBC | Radio‑Canada through Senior Executive Team discussed the current difficult challenges, the Board has contributed to reality and future of the Corporation. We welcomed significant discussions on and planning for the questions live from the public and via the Web, future of Canada’s national public broadcaster. and later posted information and representative questions and answers online. Another important To oversee the directions of CBC | Radio‑Canada, session was held in Vancouver in December during particularly as the Corporation undertakes a new, the full‑day public opening celebrations for the new longer‑term planning process, the Board struck state‑of‑the‑art broadcasting centre. Accountability a Strategic Planning Committee this year. The sessions such as these are important to all parties Board also closely followed the development and and valuable to the Board and to the Corporation implementation of the Recovery Plan, which was as they allow for greater appreciation about what designed to deal with the Corporation’s financial Canadians want and expect from their public difficulties. It also advised the Senior Executive broadcaster. Team on the content of, and approved, its successful submission for the Government’s Strategic Review. 2 | BCC | R ADIO ‑ C ANADA ANNUAL REPORT 2009 – 2 0 1 0 “a udienCe nuMBers ConfirM that we are providing audienCes with Content that they want on the platforMs of their ChoiCe.” We also said farewell to three Board members Despite the Corporation’s challenging year, the this year. The Honourable Joseph Handley, Board was pleased to witness Canadians’ strong Former Premier of the Northwest Territories, endorsement of CBC | Radio‑Canada’s programming. contributed to the work of the Board from Audience numbers confirm that we are providing May 2008 to August 2009, but resigned in order audiences with content that they want on the to pursue other interests. We thank him for his platforms of their choice. Canadians believe that assistance and enthusiasm during his time here. their national public broadcaster plays a unique Trina McQueen and Peter Herrndorf, both of whom and essential role in the social and cultural life have devoted major portions of their careers to of Canada. CBC | Radio‑Canada, concluded their terms this year. On behalf of the Board and the Corporation, I would like to express our gratitude to them for their very valuable contributions over the last five years and for their enduring commitment to the public broadcaster. At the same time, we were delighted to welcome to our Board John F. Young from Tim W. Casgrain British Columbia. CHAIR, BOARD OF DIRECTORS 2 010 – HAIR C HE T ANADA ANNUAL REPORT 2009 C ‑ ROM F ADIO R | BC message C | 3 Message froM the president and Ceo w e just went through The Plan required difficult decisions: working with our unions to minimise the impact of cuts, we the perfeCt storM — eliminated approximately 800 full‑time positions across the Corporation and cancelled or scaled an unpreCedented back many television and radio programs. These cuts triggered downsizing costs of approximately ConvergenCe of $36 million, over and above the $171 million short-terM and of financial pressures, for a total impact of $207 million, or 11 per cent of our budget. To long-terM Challenges. fund these costs and support programming until savings from the cuts materialised, we had to sell And, as if that were not enough, our long‑term certain assets. challenges were accelerated by the global economic slowdown, which had already caused the television The cuts were painful for everyone, including our advertising market to stagnate by 2008–2009. All audiences. Yet, we kept all of our stations open Canadian conventional broadcasters suffered. across the country, allowing us to remain strongly rooted in the regions – an essential aspect of our Our long‑term challenges came from the broken mandate. In the end, our collective efforts paid business model underpinning conventional off as we balanced our 2009–2010 budget while television broadcasting in this country, a model maintaining our regional presence and continued that does not get fixed as the economy recovers. to attract a record number of Canadians to our I will return to this later. programming. We DevelopeD a reCovery plan Un DersTanDing oUr aUDienCes A global economic downturn, rising rights costs, The remarkable success of our programming, shifts in technology and consumer behaviour: these despite significant financial pressures, confirms that were factors beyond CBC | Radio‑Canada’s control.

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