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Good morning. My name is Anita, and I will be your conference operator today. At this time, I would like to welcome everyone to the Corus Entertainment Fourth Quarter and Year-end 2021 Analyst and Investor Conference Call. [Operator Instructions] As a reminder, this call is being recorded. I will now turn the call over to Mr. Doug Murphy, President and CEO of Corus Entertainment. Mr. Murphy, you may begin your conference.
Thank you, operator, and good morning, everyone. Welcome to Corus Entertainment's Fiscal 2021 Fourth Quarter and Year-End Earnings Call. I'm Doug Murphy, and joining me this morning is John Gossling, Executive Vice President and Chief Financial Officer. Before I read the cautionary statement, I'd like to remind everyone that we have slides to accompany today's call. You can find them on our website at www.corusent.com under the Investor Relations section. Now let's move to the standard cautionary statement found on Slide 2. We note that forward-looking statements may be made during this call. Actual results could differ materially from forecasts, projections or conclusions in these statements. We would also like to remind those on our call today, in addition to disclosing results in accordance with IFRS, Corus also provides supplementary non-IFRS or non-GAAP measures as a method of evaluating the company's performance and to provide a better understanding of how management views the company's performance. Today, we will be referring to certain non-GAAP measures in our remarks. Additional information on these non-GAAP financial measures of the company's reported results and factors and assumptions related to forward-looking information can be found in Corus' fourth quarter 2021 report to shareholders and the 2020 annual report, which can be found on SEDAR or in the Investor Relations section of our website. I'll start on Slide 3. We delivered strong results to close out the year with yet another quarter of consolidated top and bottom line growth powered by the disciplined execution of our strategic plan and the emerging economic recovery. As I said on our last call, everything is working. Our advanced advertising leadership in targeting and automation is once again evident in our impressive revenue growth. Our fall schedule on Global is a clear winner. STACKTV's growth momentum and unique value proposition has resulted in a larger addressable market than we anticipated in our original business plan. More on that later. Demand for our original content from Nelvana and Corus Studios is robust as we ramp up our production investment to deliver more seasons of new and returning hit shows that drive ratings at home and revenues around the world. Our increased financial flexibility is setting the stage for new ways to drive future revenue growth. Over to Slide 4. As we turn the page on fiscal 2021, I'm very pleased with our team's dedication and commitment, which is reflected in these excellent results. I will briefly review the headlines with you now and later turn it over to John to take you through the details. Our consolidated revenues were up 2% for the year at $1.543 billion with everything growing, including advertising, subscriber and our content business. We financed the year with consolidated segment profit of $525 million, which was up 4% over the prior year. And this, in turn, drove another impressive year of cash generation with free cash flow of $252 million, resulting in improved financial flexibility as we benefited from the ongoing deleveraging of our balance sheet to 2.76x net debt to segment profit as well as the diversification of our financing sources with our successful high-yield offering. At Corus, our capital allocation policy aims to create shareholder value by directing free cash flow towards advancing our strategic priorities, strengthening our balance sheet and funding our dividend. As a reminder, at today's share price, Corus trades at a segment profit multiple of just over 5x at a free cash flow yield of over 20% with an attractive dividend yield of over 4%, which is well supported by a dividend payout ratio of less than 20%. Over to Slide 5. Let's talk about our fall schedule, which is always an exciting time of the year for television. Corus is a premier steward of some of the biggest and best U.S. channel brands. These powerful entertainment and lifestyle channels are favorites among Canadians. Our new prime time schedule has global, better positions competitively than it has been in years. After a long hiatus, megahit Survivor has returned to reclaim at spot as the #1 program while returning drama 911 lands in the #3 spot. New series, NCIS, Hawaii, FBI International and the highly anticipated CSI Vegas are the top new shows of the season, with CSI Vegas on track to being the #1 new show based on its continuing strong premier. On specialty, Peacock Original Series Dan Brown's Lost [ Signal ] and their new starts that is Series Dr. Death, inspired by the true story of Dr. Duntsch are the #1 and #2 scripted specialty series this season to date. Further, Dr. Death drove impressive results on STACKTV with over 2 million minutes streamed in its first week providing and proving that big is still big. [ Next up of that ] is the highly anticipated 2-hour concert event special Adele, One Night Only, featuring an exclusive interview with Adele by Oprah. A prime example of how we can amplify great content across our portfolio, this special will be broadcasted on Global and available to stream live and on-demand on STACKTV and the Global TV app. Moving to Slide 6. Corus is proud of our enviable roster of partnerships with the world's preeminent studios and content companies. Time and again, in this disruptive media and content marketplace, we have successfully managed to innovate with our partners to achieve mutually beneficial business outcomes that advance our collective strategies. Last Tuesday, Discovery, Inc. announced the launch of Discovery Plus in Canada. Over the past many months -- We have worked with Discovery, our joint venture channel partner of over 20 years to discuss opportunities to support the growth of Discovery Inc.'s business in Canada. Our collaboration was multifaceted as we address the launch of Discovery Plus, the long-term opportunities for our highly differentiated channels joint venture, which includes Canada's HDTV, Food Network, Cooking Channel and DIY, our own Canada relationship and new innovative growth opportunities to put more content in more places. Moving to Slide 7. In addition to the progress we have made in growing our business in Canada, we have also been very successful in broadening and deepening our strategic content partnerships to pursue opportunities outside of our domestic market. Think of it as moving away from the old one-way content rental model from yesterday to a new two-way content partnership model for tomorrow. Let's stay with our strategic partnership with Discovery as an example. This past year, Discovery acquired 220 combined hours that hit lifestyle and factual reality Corus TV shows for use on their channels and digital platforms around the world. Redknot, Nelvana's joint venture with Discovery Kids Latin America, greenlit 2 shows last year, Super Wish and Agent Binky, Pets of the Universe, while development began on a second season of the Dog and Pony show. These shows are broadcast on each partner's networks while also being sold around the world. Streaming platforms around the world are hungry for premium video content. Witnessed Corus Studios successful sales of Big Timber to Netflix for worldwide distribution and [ rough value of stores ] to Discovery in the U.S. Hulu is becoming yet another important buyer. Earlier this year, Nelvana secured the sale of the Hardy Boys to Hulu for the U.S. market. Further, we landed our largest distribution deal ever this past April, selling 200 episodes of premium Corus Studios content to Hulu. And this year is off to a great start with Hulu coming back for more. Today, we announced the pickup of 4 complete series totaling 58 more episodes from Corus Studios, including Worst to First, Salvage Kings, Project Bakeover and a presale of new gold hunting series Deadman's Curse. Nelvana also just announced its sale of live action series of Hardy Boys to Disney for distribution on Disney+ in international markets outside of the U.S. and Canada. This is a great feather in Nelvana's cap as we celebrate our 50th anniversary, an incredible milestone for a world-renowned animation studio. Last year, Nelvana garnered not 1, but 2 daytime Emmy nominations for the Hardy Boys and with another Emmy nod, Esme & Roy, this is truly a testament to our success in building world-class franchise IP. Last week, Nelvana, along with our partner, Spin Master and TMS Entertainment, announced the greenlight of season 4 Bakugan Evolutions, Kids around the world are getting back to the playground and rediscovering the joy of play with the collectible brand. Our content teams have done a tremendous job in building up the business, which plays an important role in our growth narrative delivering 13% growth last year. The year ahead looks to be no different as we ramp up our investment in content. Nelvana has more than 30 projects in development and production, while Corus Studios has 24 series in production, roughly half of which are additional seasons of existing hits. Corus Studios is now recognized around the world as a go-to producer of unscripted content that drives audience engagement and revenues. Moving to Slide 9. STACKTV just keeps getting better. Just last week, we unlocked an exciting new revenue stream from STACKTV. Corus began dynamically inserting advertising during STACKTV, video-on-demand content viewing. 60% of all viewing on STACKTV is on demand. And up until now, we have not been able to monetize those audiences, now we can. Corus is the only Canadian broadcaster with DAI capabilities within Amazon Prime Video, which will provide a unique opportunity for advertisers to deliver targeted ads against premium long-form video content within the Amazon marketplace. Let's talk about the other side of that coin, if you will, and that the remaining 40% of all viewing on STACKTV comes from our live linear TV feeds. These audiences enjoy the timeless experience of lean back TV viewing, brought to you by the streaming universe. That viewing is measured by numerous and captured in our total TV audience delivery measurement. As I said off the top, everything is working. And with that, I will turn it over to John to discuss our Q4 and year-end results. John?
Great. Thanks, Doug. Good morning, everyone. I will start on Slide 10. This past year, we jumped on an opportunity to diversify our sources of financing, resulting in the successful issue of $500 million of 5% senior unsecured notes due in May of 2028, an offering which was very well oversubscribed. We followed this with the amendment and restatement of our bank credit agreement, extending the maturity date to May 31, 2025, and using the net proceeds from our notes to pay down bank debt. This was an important step on our road to increase financial flexibility. Our strict cost management and balanced capital allocation approach enabled us to use our -- sorry, strong free cash flow, along with the net proceeds of the note issue to repay approximately $651 million of bank debt in the year. At the same time, we invest in the business to drive future growth and return cash to shareholders at an attractive dividend yield. Our new leverage target of under 2.5x net debt to segment profit introduced back in April is coming into view. We ended the year with leverage of 2.76x, which is down significantly from 3.18x at the end of fiscal 2020 and 2.82x at the end of the third quarter. As Doug mentioned, achievement of this leverage target will open up new options. I'd also like to highlight this morning, we declared a dividend of $0.06 per Class B share payable in December of 2021.Moving on to Slide 11 and a review of our fourth quarter and year-end consolidated results. Corus closed the year with strong momentum, reporting consolidated revenue of $361 million for the quarter and $1.543 billion for the year, representing increases of 13% and 2% over the prior year periods, respectively. Consolidated segment profit of $103 million for the quarter and $525 million for the year benefited from our top line growth and was up a significant 9% and 4%, respectively, versus the prior year. Estimated Government wage subsidy has almost entirely went down, representing approximately $1 million in the quarter compared to almost $18 million in Q4 last year. For the year, estimated wage subsidy and regulatory relief was approximately $22 million compared to approximately $35 million last year. Consolidated segment profit was negatively impacted by an increase of $2 million and $13 million in share-based compensation expense in the quarter and year, respectively, as a result of a stronger share price. We delivered a strong consolidated segment profit margin of 28% for the quarter and 34% for the year. That's down from 30% in the prior year quarter, but up from 33% in the prior year. Net income attributable to shareholders for the quarter was $20 million or $0.10 per share basic and $173 million or $0.83 per share basic for the year. Our free cash flow of $35 million and $252 million for the 3 months and the year ended August 31, 2021, respectively, was down from $87 million and $296 million in the prior year quarter and year, and that was in line with our expectations. Now just a reminder, the prior year quarter and year benefited from government relief measures, including the cash income tax installment holiday and lower programming rights payments due to COVID-19-related program delays and cancellations. And that was somewhat offset by wage subsidy receipts this year. Specifically, cash income taxes increased $31 million and $74 million in Q4 and for the year, respectively.All right. Let's turn to our TV results for the fourth quarter and the year, as detailed on Slide 12. Overall, TV segment revenues were up 12% over the prior year quarter and 3% for the year. That was driven by a 21% increase in television advertising revenue for the quarter and 2% for the year. This is an excellent result, reflecting solid execution of our strategic plan and ongoing advertising recovery throughout the year impacted by COVID-19 restrictions. The ability of our networks and sales teams to successfully balance rating supply with advertising demand to maximize the value of our inventory is also a key to our success. Importantly, our strong fall schedule and the emerging economic recovery is setting us up nicely as we kick off our new fiscal year. The positive impact of our streaming platforms now with more than 675,000 paying customers has become increasingly evident, driving notable growth in subscriber revenue of 3% in the quarter and 1% for the year. STACKTV, in particular, is fueling this important recurring revenue as awareness and interest built. The investments we're making to grow our content business are bearing fruit in a meaningful way as reflected in these results. We've yet again delivered strong gains in merchandising, distribution and other revenues up 9% for Q4 and an impressive 13% for the year compared to the prior year period. In the quarter and year, the gains were primarily driven by increased licensing sales of Corus Studios content, strong animation software licensing sales at Toon Boom as well as growth at Nelvana. TV expenses in the fourth quarter increased by 13% over the prior year as program deliveries normalized compared to delayed deliveries in the prior year and the widespread pandemic-related production hiatus while TV expenses for the year were consistent with last year.Our increased G&A expenses in the quarter primarily reflect reduced wage subsidy benefits of just over $1 million compared to $14 million in the prior year quarter as well as increased variable compensation costs commensurate with the revenue improvement. Overall, TV segment profit increased 9% in the fourth quarter and 4% for the year compared to the prior period as increased revenues outpaced expense normalization TV segment profit margins of 33% for the fourth quarter were consistent with the prior year quarter, while up to 38% for the year compared to 36% last year.As we mentioned last quarter, we are embarking on a necessary path to return course to a more normalized programming cost structure. The CRTC recently denied the Canadian Association of Broadcasters application for Canadian Programming Expenditure or CPE relief on spending that was not able to occur due to the production hiatus caused by the COVID-19 pandemic in 2020. The CRTC also provide an extended period for all licensed broadcasters in Canada to be compliant with their required CPE with the new deadline being the end of August 2023. So we have 2 years to catch up, and our teams have been working hard to determine how we can best invest to supercharge our onward content aspirations.New platform revenue and optimize advertising revenue performance metrics introduced earlier this year to demonstrate the benefits of our revenue diversification strategy are shown on Slide 13. We're gaining meaningful traction as our team pursues attractive growth opportunities in streaming, digital video advertising and the automation of advanced advertising initiatives. New platform revenue, which includes incremental subscriber revenue from new streaming initiatives and advertising revenue from digital platforms is expressed as a percentage of total advertising and subscriber revenue. New platform revenues were approximately 10% of TV advertising and subscriber revenues in the quarter, increasing materially by 46% year-over-year. New platform revenues, up 8% for the year grew 62%, a tremendous result that clearly illustrates our progress as we build more connections with audiences and drive new sources of revenue. Corus is at the forefront of changing how TV is sold. Over the last 5 years, we've invested more than $50 million in transforming how we sell television, which has vastly improved our data insights and targeting capabilities and is driving these results. Optimized advertising revenue expressed as a percentage of TV advertising revenue demonstrates our progress on this transformation, including our revenues contributed from audience segment selling as well as from our Cynch automated buying platform. Optimized advertising revenues represented approximately 34% of total TV advertising revenue in the fourth quarter, and that's up from 21% in the prior year quarter. Optimized advertising revenues 31% for the year grew by 43% as more and more advertisers realize the benefits of data-driven insights and targeting as an integral part of their campaigns. In absolute dollar terms, this represents more than $260 million of TV advertising revenue in 2021, and we expect it to grow.Now let's turn to Radio results as outlined on Slide 14. It's great to see the rebound in Radio segment revenues. We delivered a 32% increase for the quarter, with revenues down 6% for the year. The broad improvement across key advertising categories is very encouraging. We still have ways to go as Radio continues to be disproportionately impacted by pandemic-related restrictions on local businesses, but we are still outperforming the market in English Canada. Our rank position in several key markets remain strong, and we are well positioned as local businesses continue their road to recovery. Radio segment profit increased to $4.3 million in the quarter driven by revenue improvements as we continue to navigate the challenging market conditions, while down to $14.2 million for the year. Segment profit margin increased significantly to 17% from 6% in the prior year quarter and was down slightly to 15% compared to 16% in the prior year. We continue to diligently manage costs as we progress through the recovery.So to recap, fiscal 2021 ended with very strong momentum. We are encouraged by the growth across all of our revenue streams this quarter. Our strong fall schedule positions us for a great start to our new fiscal year. We are taking meaningful steps to advance our strategic plan, furthering our leadership position in advertising innovation, expanding our streaming business with unique offerings like STACKTV and leveraging our Corus advantage to create new international revenue opportunities. Our improved balance sheet provides us with the increased financial flexibility, enhancing our ability to create future value. And in some, as evidenced by these strong results, we are moving in the right direction.With that, back to you, Doug.
Thanks, John. Finally, over to Slide 15. I want to take a moment in my concluding comments to spotlight 3 important parts of the Corus investment thesis that are foundational to our goal of achieving consolidated revenue growth year over year over year. The first item I wanted to spotlight is what we have described as our Corus Advantage. Corus is proud of our role in bringing Canada to the global screens big and small, with great content produced at Nelvana and Corus Studios. In addition to the many shows, we bring to life in collaboration with our independent producer partners. Each year, we invest our internal production dollars to grow our content business or the studio business as I like to put it, leveraging our required spending to diversify our revenues outside of Canada. Last year, in total, we produced over 350 episodes. Many of these are additional seasons of proven hits creating true franchise value. An equal amount are promising new projects resulting from the purposeful increases we have made in our development funding over the past 2 years. What is most important is that we control the green light. We are not at the mercy of the long wait for a broadcast pickup or having to produce a pilot before a streamer will buy our shows. The Corus' advantage not only leverages our required spending to accelerate revenue growth, it also de-risks the production side of our business. The second important point of the investment thesis I wanted to spotlight is what I described as Canada's unique market structure. The market structure in Canada is unique in that it is highly concentrated with 3 broadcasters accounting for 83% of the English linear audience share. This market is unique in that it is vertically integrated as 2 of those broadcasters are owned by the 2 largest distributors in Canada, Rogers and BCE, who are rolling out the 2 future state video distribution platforms, Xfinity and MediaKind. This market is unique and that it is regulated, which has resulted in the traditional channel bundle being more accessible to all Canadians at about half the price of that in the U.S.A.Finally, this market is unique and that it is highly collaborative with broadcasters working together on advanced advertising initiatives such as common audience segments and ensuring an enhanced value proposition for our subscribers. According to our recent CTAM's report, 74% of Canadians enjoy a television subscription. This market is unique, and that is noteworthy. This unique market structure in Canada results in a very lucrative content licensing opportunity for our U.S. studios and content partners. This matters greatly when it comes to Corus' ability to renew and secure content on a long-term basis for the 3 quarters of Canada who enjoy the channel's experience. It also matters as we work to reaggregate our channels bundle on new streaming platforms such as STACKTV on Amazon Prime Video. This past year, we have secured several multiyear content renewals. And in so doing, reaffirmed the important role that the channels business plays as part of our partners international content licensing strategy. I will describe it this way. This is not an either/or proposition for them. It's all about the and as they seek to ensure their content is available to the widest possible audience and optimize their economics. I'd also add that in addition, not all of our partners have the scale to launch a global SVOD OTT service. And for them, Corus provides an attractive content licensing alternative. Now to my third and final spotlight. Our experience with STACKTV demonstrates that lean back television is alive and well. And when paired with VOD provides a compelling consumer value proposition. STACKTV is the first product of its kind in the world, the reaggregation of the channels business delivered on a streaming platform. Our eyes in the eyes of the industry have been opened. It's now obvious to all the STACKTV is a game changer. It has clearly defined the opportunity in Canada to put more content in more places. As a result of the continued smart investments we've made with our content partners, we have ambitious plans to expand STACKTV, both the product and the distribution in the quarters and the years ahead.So as we turn the page on fiscal '21, we're also turning the page on the latest chapter in my book of COVID onto the next chapter, which we are calling full stream ahead as we pursue a revised target of 1 million paying streaming subscribers.As a final note, I want to thank our entire team for their tireless commitment as we work to advance our strategic priorities and build a stronger Corus while bringing innovative new ideas to the table.Thank you, and back to you, operator.
[Operator Instructions] We take our first question from Adam Shine with National Bank Financial.
Maybe we start with how ad pacing is evolving in the seasonally important Q1. Obviously, some puts and takes that we're all aware of in the marketplace. But Doug, just give us a sense as to how things are growing at the start of the year?
We're off to a great start. You know there's a lot of demand in the market, which is great. It's nice to see advertisers putting dollars back to work. Clearly, the economy is reopening, Canadians are spending money. So the demand is there. And the good news is that our schedule is delivering some great results. And so that means the inventory is there. And our team is doing a great job matching demand with supply. So I would say that the advertising economy, which, of course, is a leading indicator would suggest that things are looking very promising. There's some categories we're all aware of that are kind of weak like automotive and health and beauty, lipstick sales are down. But on the flip side, retail is up, financial services, communications, food, a lot of categories are very strong. And some of them, in fact, are stronger than they were back in fiscal '19. So I would just say in short that it's off to a great start. We're very confident.
Do you try and size for us the opportunity of this ad insertion in regards to STACK? I know it's early days, just off to a debut a week ago, but just to give a sense as to what the potential is here?
I would say it's sort of single-digit millions this fiscal, but that should be -- have a nice growth trajectory just given the opportunity to monetize additional digital inventory. So I think that's kind of out of the gate. That's what I would just give you a guidance there. And I expect that to grow handsomely in the coming years.
Okay. Maybe just lastly for you and John, I mean, you start off some of this session talking about obviously a stock that you deemed to be undervalued as I think a number of us on the call also share that view. But then John later on also acknowledged that you appear to be rather committed to getting leverage down below 2.5x. So net-net of all that, does that suggest that the capital allocation strategy doesn't necessarily change per se? And that we're not necessarily going to see any aggressive moves on a buyback through the course of this year?
Yes, that would be -- that's a good characterization, Adam. And we have a long list of internal organic investment opportunities that we're considering and leverage continues to be a target to produce while we fund that dividend. So I would say share buybacks are not in the picture -- absent big market event where we get some return to '08, '09. But none of us wishes that and anybody. So I think we've got a plan. We're going to execute the plan, and that will be both the combination of investing and strategic priorities and deleveraging the balance sheet.
We'll take our next question from Vince Valentini with TD Securities.
I have 3 questions. I'll go down to hit them with you 1 at a time. So sticking with advertising, Doug, the categories that are weak we all know of. But you obviously have a limited amount of inventory and there seems to be very good demand from other categories. Can you still achieve like you optimize your TV advertising revenue with those other categories? Or should we assume there's actually a bit of a dip because those auto and other categories are -- can you replace auto with all the other categories that are super strong and potentially get back close to where you were in the first quarter of 2020 on TV ad revenue?
Yes. I think the quick answer is yes. There's a lot of categories that are up very significantly compared to '20, retail, not surprisingly, as I said, communications, government, food or categories that are packaged goods are strong. Entertainment is coming back, like a House On Fire, Witness Mike Myers and the Halloween thriller last weekend. So we're happy to see Canadians going back to cinemas. And that's late-breaking money, which comes at a good CPM. I think the other thing I would just say is that because of the competitive and relative performance of our schedule and the demand, the pricing environment is encouraging for us. So those things kind of set up, I think, a strong start to the fiscal.
So getting back to first quarter of 2020, so the fall of 2019, getting back to those levels is a possibility?
I think we're within striking range. I think a few more things have to break in our favor. But I would say that the team is doing really good work. And once again, it's a team effort with the programming group and put up some fantastic shows and running a great schedule and then the revenue team doing certainly smart management of the inventory to ensure that we maximize our economics and out of our advertising partners and agencies.
Great. Second question...
Just before we leave that, if you step back at TV overall to all 3 revenue categories because we've got some good growth in subscriber and the other lines, I think that's definitely insight.
Second question, probably for you as well, Doug, is the -- these recent partnerships you're doing, did you say, two-way content partnerships as opposed to just renting content. And obviously, Discovery Plus was the big recent one. Is it a key objective of yours in these partnerships to extend the duration of making sure you have good U.S. content locked up? And is that -- can you tell us is that maybe part of how you've approached recent negotiation?
A 100%. Yes, sure. I mean, basically, we establish ourselves through the -- as we said before, the preeminent brand steward and indispensable local market partner. And so each conversation with each partner is bespoke to their strategies. And our objective, of course, is to sustain the resiliency of the channels business, both traditional set-top box delivery channel business, but the emerging new reaggregation of the channels business on streaming platforms, which is the big note of this call. And so in these conversations, it's both about term extension and rights expansion to the extent it is possible, and that's what we strive for.
So any you would have said, the Discovery Plus announcement is basically just you're selling them advertising so they can promote their streaming service, that's not correct. It's more of a comprehensive negotiation and deal that would have included some wins for you as well.
100%. There is an expensive multifaceted win-win arrangement.
And last question. John, you mentioned having to catch up on CPE by August 2023. Is there any expectation as part of that, that the -- I think it was a 25% cap you used to have on how much of the CPE you're allowed to own the distribution rights and IP rights for. Is there any expectation that, that 25% gets lifted over the course of this 2-year period so that you have to invest more, but you actually can invest wiser and keep some of the content rights as you spend more on CPE?
Yes. You're thinking of the P&I or programs of national interest requirements in. So that's a subset of a 30% CPE. And then what you're talking about is a subset of that, a percentage of that has to be independent. We're operating right now under our current license conditions, and that's our assumption going forward. We don't have the current license, which expires at the end of this fiscal. That has not been renewed. So we don't know what the terms of that might be, but we're expecting things to look similar in the short term.
I would add just on that, that clearly, we're proud of the content we make with our producer partners on the P&I segment. Some recent examples, family law was a big header schedule, most recently, nurses departure, some are examples of those. So those are scheduled builders for us. And then of course, we strive to make as many shows that we can, that we can own and monetize globally, and that's evident in phenomenal success we've had this past year on Corus Studios.
The next question comes from Jeff Fan with Scotiabank.
Just to follow up on Vince's question about the studio partnerships. Am I correct in interpreting that the recent deals you announced included some extension of the terms related to that particular partner. Wondering if you could just give a little bit more detail around that. And then on the content side...
Sorry, go ahead, Jeff.
Yes. So the second question was just regarding the distribution revenue outlook. You had a tough comp this quarter, and it looks like you still was able to generate decent growth. And for the year, that line actually grew nicely double digits. Can you give us a little bit of color on how you think about that given the content pipeline that you have? And also in light of John's comment about total revenue growth for next year?
So yes. So the quick answer is that term extensions are a key piece of those conversations. And so yes, but we're not going to tell you the details on the term. But suffice it to say, it's -- we're very pleased with the outcome. And in terms of the content business, I think what you're seeing here is, as I said before, we invested a lot more money relatively speaking, in development a couple of years ago to kind of stoke the fire of Corus Studios and Nelvana and Corus Studios, in particular, has really established itself as a different kind of unscripted lifestyle and factor reality producer whose content are being snapped up by streamers and broadcasters around the world. So basically, we're just trying to ramp that business up big time because the content is highly consumable. We can produce and turn it pretty quickly. Animation takes 3x as long in Nelvana, relatively speaking. And then the great thing is, and the note I'm really trying to make here on my 3 spotlights, and I would encourage all of us on the call to just reflect on those. But the one around Corus Advantage is, yes, the decision on CPE was somewhat unexpected and one could discuss that. But it plays directly into our strategy to supercharge our content business. And so in many ways, we're going to invest to extend multiple seasons of proven hits not as Island of Bryan or other shows like that, that's fully within our control, and we have established kind of customers around the world that want more. So it really sets us up to continue the momentum we've seen on the content business in the years ahead. John, I'm not sure if you want to add anything further?
No, other than just my normal caution, Jeff, that line can be a bit variable from quarter-to-quarter. So it's very much driven by deliveries and deals getting across the line. So we -- our content team has just done an outstanding job in '21 to keep that growth going. I think you noted -- We've had some pretty tough comps to show growth versus compared to 2020. So that would be my only comment the variability is always going to be there, but we'll try to smooth out as much as we can.
I would just make another comment as well, right, to not lose sight of our -- and we don't break it out specifically, but the Toon Boom business in Montreal is having spectacular growth. With the demand for animation being so strong and Toon Boom's preeminent position as the leader in 2-dimensional animation software, the picks and shovels business is really very helpful, too.
Just a follow-up, and I may have missed this. Doug, do you have any metrics on shows that are in development going into next year currently versus where you were perhaps a year ago? And then just on the opportunity, it sounds like you're not buying back any shares. So are there opportunities to accelerate this content development, given Corus Studio has the brand, has the relationship to be able to accelerate it and make this even a bigger opportunity for you?
Yes. The short answer is, absolutely. We don't break out necessarily any kind of metric on development in terms of series and shows. Nelvana has got -- we lump them together. So Nelvana has got 30 series in greater stages of production and/or development. Corus Studios has got 24 series in production and a lot more in development. We talked about Pamela Anderson's Garden of Eden, tentatively titled show. And as I mentioned, the CPE catch-up requirement is just going to help us sort of put the pedal down on further acceleration of that. But in terms of trying to give you some guidance, I would just speak more to double-digit growth, like I've said now for a number of years on content, that's clearly within reach. And we talked about our future film. We still have ambitions on animation and feature film. We've got a few projects that are being reviewed now. So there's a lot of activity going on in that piece of the business, we just talked with the Bakugan evolutions greenlights, so we're back -- the band is back together again with Spin Master, which is super exciting. So there's a lot of promising developments that are kind of in the hopper in the content side.
[Operator Instructions] We take our next question from David McFadgen with Cormark Securities.
A couple of questions. So I don't think you've addressed it on the call yet, but can you talk about programming cost inflation that you expect for this year?
Sure, absolutely. I mean I think I referred to it, but probably not in a lot of detail. So if you look at now all of '21 David versus '20, we were essentially flat, which would not have been our expectation going into '21. But given delays on production, both Canadian and foreign as we call it, our U.S. Hollywood stuff, that's where we ended the year. We've I think, been signaling in the last several quarters that that's not really the way to think about programming cost for us. I think there's a lot more delivery as we've talked about in Q1 for Global and as well on the Canadian side with that makeup that we have to do on CPE. So I would say, particularly coming out of the gate in Q1, there's going to be a lot more programming cost. Recall last year, we were down, I think, $20 million or $25 million just in the quarter, so that was all about the timing of the fall launch or the lack thereof. But going forward, yes, you're going to see pretty significant increases in programming costs. I think that is just natural from where we're starting. Is that going to be low double digits, probably, and that's going to vary by quarter.
I guess the thing to consider is that there's strong advertising demand I mean the programming cost is, of course, important to model and obviously, we track it. But from where I'm sitting, given the enormous demand we're seeing, I'm delighted to have all that content coming in because the art and science of this business is obviously to match the impression supply with the demand from your advertisers.
So -- just to clarify, so you're talking about low double-digit increases for fiscal '22, right?
Yes.
Okay. And then just on the ad trends, we've seen some people report some softness, just some of the supply chain impacts around the world. It doesn't seem like you're seeing anything like that, are you?
Well, the category that we're most seeing it is in automotive, that's true. And toy so far is not catching up. I think the toy business is clearly affected by the containership issues. Those are the 2 obvious supply chain affected. Health and beauty is more behavioral. People just aren't buying certain types of products they used to buy and they're not going to the office as much so they don't need their usual health and beauty products.
Okay. And then, John, what do you think the corporate expense would be this year now? And I assume there's no government subsidy going forward, right?
Yes. I mean that was a big factor, obviously, in '21 that coming out, especially in Q4. It's always very difficult to predict the stock-based compensation, obviously, given the way the stock price can move around. But I think I'm just trying to pull up the number for '21. I think, look, probably the best assumption is that it's relatively similar to what it's been. That does vary by quarter. But I think if you look at it similar to '21, plus or minus a few million dollars, that's the best way to think of it.
Okay. Then '21 have a lot of government subsidy offsets in there?
I wouldn't say a lot, but there's definitely some. But on the other hand, it had a very high amount of stock-based comp, right? We were -- for the full year, we were at almost $18 million of stock-based comp, which I would consider to be high versus what I would think is normal, right? And of course, you saw in '20 the exact opposite it was quite low. So it's jumping around with the stock price, and that's what makes it hard to really predict.
Mr. Vince Valentini of TD Securities, has a follow-up question.
Yes. I just wanted to clean up a couple of other loose ins if there's no other questions. There is a venture capital gain of USD 34.5 million that you achieved in September. Can you give us a bit more color on what that was, and I assume that's just cash in the bank now?
Yes. That was related to SCOR media, which we had an investment in through one of our venture funds. So yes, that money came in 2 or 3 weeks ago. That money is in the bank.
And based on your definition of free cash flow, I believe you will include that as free cash flow in fiscal '22?
Yes, that's definitely been the way we've done it historically.
Okay. And the cash tax you alluded to in your opening remarks, John, I think you're implying that it comes back a bit down to normal a bit in terms of just the cash payments, not the accounting tax coming back to normal a bit in fiscal '22?
Yes, definitely. I mean, that gain that we just talked about will attract some cash tax. But yes, I think a more normalized level is the way to think about it.
And not quite lastly, but second last, the program cost increase you talked about with the acceleration starting in Q1 with global deliveries and extra CPE. I just want to make sure I understand that right. Is that the cash flow impact hits in Q1? Or is it the amortization of that programming also hits in Q1? Or is there a lag effect?
There's a bit of a lag. It will be both, but the amortization impact will definitely come because those shows on Global are expense as they play, and we're obviously seeing strong deliveries right now through these launches.
Okay. And DAI, the mid-single-digit revenue from ad insertion on STACK. Would you count that as part of the optimized advertising revenue? Or is that just part of the new -- or the 10% number?
That's the new platform.
That's a new platform.
Even though the advertising revenue sold in a different way, you don't call that optimized advertising revenue.
The optimize is the audience segment selling and the Cynch automation. So that's how we break that apart. So the new platform includes digital advertising.
So when we get to addressable, that I know the industry is trying to work towards what category is that kind of go in?
We'll get back to you on that one. But let me just -- thanks for the segue, I just want to -- we haven't talked about this yet, but the blistering growth that we're seeing in those 2 metrics that we started telling the Street about I think it's certainly notable, right? I mean we -- a new platform grew 61%, 62%, so that's smoking. That's up $40 million plus from last year. And the optimized ad revenue grew 43%. That's up $80 million from last year. So if there's any doubt that our growth story is in taking hold, those numbers should scream out that -- as I said, on the top advertising is working, subscribers working STACK is working, contents working, everything is working.
It appears there are no further questions at this time. Mr. Murphy, Mr. Gossling, I'd like to turn the call back to you for any additional or closing remarks.
Well, thank you, operator. I just kind of made my punch line there at the end with Mr. Valentini. So we would just like to thank everybody on the call today. We look forward to speaking to you today on our follow-up calls, and have a great weekend, stay safely well, be well. Take care now. Buh-bye.
This concludes today's call. Thank you for your participation. You may now disconnect.