Quebecor Inc. Reports Consolidated Results for Second Quarter 2008

Market Wire, August, 2008

Quebecor Inc. (TSX: QBR.A)(TSX: QBR.B) consolidates the financial results of its Quebecor Media Inc. subsidiary, in which it holds a 54.7% interest.

HIGHLIGHTS SINCE END OF FIRST QUARTER 2008

- Quebecor's second quarter 2008 revenues amount to $942.3 million, up $127.0 million (15.6%) from second quarter 2007.

- Operating income: up $46.3 million (20.1%) to $277.0 million.

- Income from continuing operations: up $7.4 million ($0.12 per basic share) or 14.8% to $57.3 million ($0.89 per basic share), compared with $49.9 million ($0.77 per basic share) in the same period of 2007.

- Adjusted income from continuing operations (excluding gains and losses on valuation and translation of financial instruments and the reserve for restructuring of operations): up $3.9 million ($0.07 per basic share) or 10.4% to $41.4 million ($0.65 per basic share) in second quarter 2008.

- Cable segment: operating income up $36.5 million (25.1%) . Quarter-over-quarter net customer growth: 51,300 for cable telephone service, 23,600 for cable Internet access, 7,800 for all cable television services combined (including 27,700 customer increase for illico Digital TV), 4,700 activated phones for wireless telephone service.

- Spectrum auction for third generation Advanced Wireless Services (AWS): Quebecor Media is successful bidder on 17 operating licences covering areas including all of Quebec for $554.6 million.

- Videotron Ltd. issues US$455.0 million aggregate principal amount of Senior Notes.

- Videotron amends senior secured credit facility to raise commitments from $450.0 million to $575.0 million and extend maturity date to April 2012.

- Agreement in principle on July 2, 2008 ends labour dispute at Le Journal de Quebec.

Quebecor's consolidated revenues from continuing operations increased by $127.0 million (15.6%) to $942.3 million in the second quarter of 2008. The most significant increases were in the following segments:

- Cable (up $75.6 million or 20.3% of segment revenues) reflecting continued customer growth for all services;

- Newspapers ($65.7 million or 27.2%) due primarily to the impact of the acquisition of Osprey Media Income Fund in August 2007;

- Broadcasting ($4.5 million or 4.2%).

Quebecor's operating income from continuing operations rose $46.3 million (20.1%) to $277.0 million, with increases in the following segments:

- Cable (up $36.5 million or 25.1% of segment operating income), due mainly to customer growth;

- Newspapers ($17.9 million or 32.7%) due primarily to the acquisition of Osprey Media.

"Once again, Quebecor's very positive results were spearheaded by robust numbers in the Cable segment, which continued to log strong customer growth for all its services," said Pierre Karl Peladeau, President and Chief Executive Officer of Quebecor Inc. "At the conclusion of the spectrum auction for Advanced Wireless Services, Quebecor Media held standing high bids on 17 operating licences, covering all of Quebec and part of the Toronto area. This is a key strategic development for Quebecor Media, since consumer demand for Advanced Wireless Services is expected to increase substantially in the coming years. With the addition of this product, Quebecor is poised to embark on a new round of growth by offering its Cable segment customers a still more complete and competitive array of cable and telecommunications services."

Quebecor Inc.
Second quarter financial highlights - 2004 to 2008
(in millions of Canadian dollars)
---------------------------------------------------------------------------
                                       2008    2007    2006    2005    2004
---------------------------------------------------------------------------
 Revenues                            $942.3  $815.3  $739.9  $669.1  $613.6
 Operating income                     277.0   230.7   207.2   194.5   191.3
 Income from continuing operations(i)  57.3    49.9    17.7    60.8     3.9
 Adjusted income from continuing
  operations(i)(ii)                    41.4    37.5    30.5    16.9    11.2
---------------------------------------------------------------------------
(i)  See "Quebecor Inc. - Discontinued operations" below.
(ii) See "Adjusted income from continuing operations" below.

- Quebecor's income from continuing operations was $57.3 million ($0.89 per
basic share) in the second quarter of 2008, compared with $49.9 million
($0.77 per basic share) in the second quarter of 2007. The increase of $7.4
million ($0.12 per basic share) was due primarily to:

    - $46.3 million increase in operating income;

    - favourable variation of $16.9 million in gains and losses on
      valuation and translation of financial instruments, resulting
      primarily from $16.5 million favourable change in accounting
      estimates of the fair value of derivative financial instruments,
      reflecting market developments and recent accounting guidelines.

    Partially offset by:

    - $24.1 million increase in financial expenses, mainly as a result of
      higher indebtedness;

    - $15.7 million increase in income tax expense and $11.7 million
      increase in non-controlling interest.

Adjusted income from continuing operations

- Adjusted income from continuing operations equals income from continuing
  operations excluding gains and losses on valuation and translation of
  financial instruments and the reserve for restructuring of operations.
  Adjusted income from continuing operations was $41.4 million in the
  second quarter of 2008 ($0.65 per basic share), compared with $37.5
  million ($0.58 per basic share) in the same period of 2007, an increase
  of $3.9 million ($0.07 per basic share), or 10.4% .

Year-to-date

- Quebecor's consolidated revenues from continuing operations were $1.82
  billion, an increase of $253.0 million (16.2%) . The most significant
  revenue increases were in Cable ($147.4 million or 20.2% of segment
  revenues), Newspapers ($112.8 million or 24.4%) and Broadcasting ($17.7
  million or 8.9%), essentially due to the same factors as those noted
  above in the discussion of the second quarter results.

- Quebecor's operating income from continuing operations was $533.4
  million, an increase of $119.1 million (28.7%) . The largest increases
  were in Cable ($83.4 million or 28.3% of segment operating income),
  Newspapers ($29.2 million or 32.7%) and Broadcasting ($8.3 million or
  33.5%) .

- Quebecor's income from continuing operations was $102.1 million ($1.59
  per basic share) in the first half of 2008, compared with $53.1 million
  ($0.82 per basic share) in the same period of 2007. The increase of
  $49.0 million ($0.77 per basic share) was mainly due to:

  - $119.1 million increase in operating income;

  - favourable variation of $46.5 million in gains and losses on valuation
    and translation of financial instruments, resulting primarily from
    $16.5 million favourable change in accounting estimates of the fair
    value of derivative financial instruments, reflecting market
    developments and recent accounting guidelines, and favourable
    variations  in the fair value of exchangeable debentures
    ($13.7 million) and of  embedded derivatives and other instruments
    ($16.3 million).

  Partially offset by:

  - $39.7 million increase in financial expenses, mainly as a result of
    higher indebtedness;

  - $48.2 million increase in income tax expense and $21.6 million increase
    in non-controlling interest.

Adjusted income from continuing operations

- Adjusted income from continuing operations equals income from continuing
operations excluding gains and losses on valuation and translation of
financial instruments and the reserve for restructuring of operations.
Adjusted income from continuing operations was $75.7 million in the first
half of 2008 ($1.19 per basic share), compared with $54.1 million ($0.84
per basic share) in the same period of 2007, an increase of $21.6 million
($0.35 per basic share) or 40.0% .