Stock Recap

Andrew Foresi 2nd Year Analyst Energy & Mining Blerina Ago 2nd Year Analyst Energy & Mining

Agenda Rating Company Overviews Thesis I Thesis II Price Forecast Our Portfolio

Both thesis’ remain true to the future growth potential of the company Rating: Hold Both thesis’ remain true to the future growth potential of the company Quebecor is a medium to long-term investment Quebecor continues to produce steady, non-volatile returns In aggregate, we are going to hold Quebecor as an investment in our portfolio because of its medium to long term growth potential We chose to invest in Quebecor because of these mid to long range time forecasts and we believe that Quebecor and its subsidiaries will continue to produce positive results while simultaneously meeting their future growth forecasts as I will explain in our thesis. Lastly, when we first invested in Quebecor nearly a year ago, they were creating steady and non volatile returns as one of the largest holding companies in Canada, and they continue to do so

Additional Assets of Quebecor Media Company Overview Additional Assets of Quebecor Media TVA Group TVA Publishing Inc. Canoe Inc. Sun Media Corporation Inc. Quebecor (QBR.B) is a Canadian leader in telecommunications that is firmly based in Quebec holding 81% of its largest asset, Quebecor Media. Videotron is Quebec’s most respected telecommunications company with significant interests in wireless, Internet, cable and home phone services. Quebecor Media is a Canadian media company with significant interest in wireless telecommunications through its subsidiary Videotron.

McMaster Investment Council Videotron Timeline Mar 6th 2015 Successfully won the bid for four 30 MHz licenses, obtaining licenses covering 100% of Quebec’s population and the Ottawa area for $31.8 million Mar 11th 2015 Videotron acquires 4Degrees Colocation and its data centre for $31.5 million, enabling Videotron to meet its business customers’ needs and address the movement towards big data applications Q1 2015 ARPU up 8.4% including a 15% increase for mobile telephone services, and increasing mobile telephone revenues by $27.7 million and internet revenues by $13.4 million May 12th 2015 Successful bidder of Industry Canada’s 2500 MHz commercial mobile spectrum auction, gaining 18 licenses covering major urban centres in Canada for $187 million Q2 2015 ARPU up 8.2% including a 13.8% increase for mobile telephone services, Q2 2015 mobile telephone revenues up by $29.5 million and internet revenues by $14.1 million Here we have a timeline showing some of the more significant events that have occurred at Videotron since our purchase back in late January of 2015. January 7th 2016 - Videotron acquires Fibrenoire for $125 million. Fibrenoire is a fibre optic connectivity business that provides more than a thousand customers in Montreal , QC, Ottawa and Toronto with connectivity services. Fibrenoire is ranked as Quebec’s fastest-growing company on the PROFIT 500 list, which measures Canadian companies’ 5 year revenue growth. The new connection will give Fibrenoire access to financial resources, technological depth and a fibre optic network of more than 30,000 km available across Quebec. This will enable them to serve customers better and generate growth. Estimated $30 million generated revenues with 30 -40% EBITDA Source: http://www.quebecor.com/en/comm/videotron-acquires-fibrenoire-meet-growing-demand-qu%C3%A9bec-business-market Nov 17th 2015 Videotron has to pay consumers $7m for an overcharging CRTC fee Free was initially 1.5% of the bill but later reduced to 0.5%, however this should have only been applied to TV services not to pay-per-view Videotron based the fee or cable customers on its regular monthly rate, even when they had a discount for bundling Superior court found Videotron deliberately overcharged customers and was violating its contracts with consumers Source: http://www.cbc.ca/news/business/videotron-class-action-overcharging-1.3322763 Oct 15th 2015 Bell ExpressVu ordered to pay Videotron $139.1 million non-adjusted-operating-income which will be recognized Q3 2015 Payment due over Bell’s failure to successfully implement a security system to prevent privacy of its television signals broadcast by satellite between 1999 to 2005 May 12th 2015 -Urban centres include Toronto, Edmonton and Calgary Sunday, November 11, 2018 McMaster Investment Council

McMaster Investment Council Videotron Timeline Q3 2015 ARPU up 8.7% including a 11.2% increase for mobile telephone services, Q3 2015 mobile telephone revenues up by $30.7 million and internet revenues by $15.3 million Oct 15th 2015 Bell ordered by Supreme Court of Canada to pay Videotron $139.1 million in compensation for neglecting to implement an appropriate security system Nov 17th 2015 Videotron to pay $7 million back to consumers for overcharging on CRTC fee Jan 7th 2016 Fibrenoire acquired for $125 million to meet growing demand in the Quebec markets Here we have a timeline showing some of the more significant events that have occurred at Videotron since our purchase back in late January of 2015. January 7th 2016 - Videotron acquires Fibrenoire for $125 million. Fibrenoire is a fibre optic connectivity business that provides more than a thousand customers in Montreal , QC, Ottawa and Toronto with connectivity services. Fibrenoire is ranked as Quebec’s fastest-growing company on the PROFIT 500 list, which measures Canadian companies’ 5 year revenue growth. The new connection will give Fibrenoire access to financial resources, technological depth and a fibre optic network of more than 30,000 km available across Quebec. This will enable them to serve customers better and generate growth. Estimated $30 million generated revenues with 30 -40% EBITDA Source: http://www.quebecor.com/en/comm/videotron-acquires-fibrenoire-meet-growing-demand-qu%C3%A9bec-business-market Nov 17th 2015 Videotron has to pay consumers $7m for an overcharging CRTC fee Free was initially 1.5% of the bill but later reduced to 0.5%, however this should have only been applied to TV services not to pay-per-view Videotron based the fee or cable customers on its regular monthly rate, even when they had a discount for bundling Superior court found Videotron deliberately overcharged customers and was violating its contracts with consumers Source: http://www.cbc.ca/news/business/videotron-class-action-overcharging-1.3322763 Oct 15th 2015 Bell ExpressVu ordered to pay Videotron $139.1 million non-adjusted-operating-income which will be recognized Q3 2015 Payment due over Bell’s failure to successfully implement a security system to prevent privacy of its television signals broadcast by satellite between 1999 to 2005 May 12th 2015 -Urban centres include Toronto, Edmonton and Calgary Sunday, November 11, 2018 McMaster Investment Council

Thesis I - Videotron’s Growth Potential in Internal and External Markets Quebecor Media’s Videotron has shown immense growth potential from the start of its facilities-based approach in 2010. Based off of two historical core competencies and a competitive advantage amongst smaller players, we believe that Videotron is positioned to become - in some capacity - Canada’s 4th national Telecom player. Management prudency coupled with favorable regulatory body support will mitigate uncertainty risk. If a national expansion is not seen by management as a viable option, the Quebec wireless market is still a prime opportunity for growth.

2015 Videotron Growth Increased ARPU with respect to OTT Video, Wireless and Internet Decrease in home phone usage and revenues is counteracted by growth in Wireless Steady decrease in Cable subscribership and revenue growth partially counteracted by increase in Internet and OTT Video

Fibrenoire & 4Degrees Acquisition Acquired 100% of 4Degrees Colocation on March 11th, 2015 for $31.5m Largest data center in Quebec City Acquired 100% of Fibrenoire on January 7th, 2016 for $125m Caters towards Videotron’s Quebec business customers In 3 yrs, doubled revenues and doubled profits Both acquisitions aid in Videotron’s competency of offering bundles to customers, now in their business market where data management is of increased importance Strongly accents Videotron’s internal market growth potential STRONGLY ACCENTS THEIR INTERNAL GROWTH POTENTIAL January 7th 2016 - Videotron acquires Fibrenoire for $125 million. Fibrenoire is a fibre optic connectivity business that provides more than a thousand customers in Montreal , QC, Ottawa and Toronto with connectivity services. Fibrenoire is ranked as Quebec’s fastest-growing company on the PROFIT 500 list, which measures Canadian companies’ 5 year revenue growth. The new connection will give Fibrenoire access to financial resources, technological depth and a fibre optic network of more than 30,000 km available across Quebec. This will enable them to serve customers better and generate growth. Estimated $30 million generated revenues with 30 -40% EBITDA Source: http://www.quebecor.com/en/comm/videotron-acquires-fibrenoire-meet-growing-demand-qu%C3%A9bec-business-market

Spectrum Auctions and Acquisitions Date Price Description 2500 MHz May, 2015 $187m Supports LTE in all major urban areas (Toronto, Ottawa, Montreal, Calgary, Edmonton and Vancouver) Reaches 21 million Canadians Address the growing demand for faster and more reliable services 700 MHz January, 2014 $ 233m - Covers broader areas in Quebec, Ontario, Alberta and British Columbia AWS-3 May, 2008 $ 554m - Has the greatest coverage span in Quebec providing 3G+, HSPA and LTE STRONGLY ACCENTS THEIR EXTERNAL GROWTH POTENTIAL It is predicted that for Videotron to build an entire network in western Canada, it would cost $1 billion, nearly as much as they spent to develop their Quebec network Successful auctions represent Videotron’s efforts to develop a wireless network that spans greater than the province of Quebec increasing potential to reach a large external market

Outlook – Thesis I True and Still Holds Increased subscriber growth patterns in Quebec (internal market) Increased ARPU on an aggregate and segmented basis Still Holds Success in building a national infrastructure that is capable of reaching more than 90% of the Canadian population Continued focus on maintaining a leading telecommunications role within Quebec CRTC still considering the option of allowing an additional wireless carrier into the market Allows for increased competition and lower prices for the consumer Example: Free Mobile in France Small carrier rented existing infrastructure from an incumbent Offered prices as much as 50% below competitors for similar services Result was a 5.4% increase in market share within 6 months Competitors were forced to lower prices as a result in order to compete

Thesis II - Short-time Oriented Discounts Quebecor’s extrinsic value is being inhibited due to a short-term oriented market holdings discount. This holdings discount is only applicable in the near-term investment horizon, as relative leverage levels remain unsatisfactory and Quebecor Media is not wholly owned. In our investment horizon we are to see either the buyout of minority interests or an equity carve out (ECO)

Thesis II - True and Still Holds Quebecor’s plans to acquire the remaining stake in Quebecor Media began in late 2014. This is the tricky part. It is hard to confirm to the extent that this has contributed to a reduced holdings discount. However, in aggregate, the holdings discount will be erased over the course of Quebecor’s plans to purchase the remaining stake in Quebecor Media. This will of course be spread across 2-3 years, as forecasted In 2015 they had acquired an additional 6% of the external stake in Quebecor Media. We could see complete ownership in less that 3 years while continuously eroding the holdings discount thereby increasing the extrinsic value of Quebecor.

Valuation Recap The following information was pulled from the January 2015 pitch.

1 Yr. Price Forecast Reflected by the proven thesis’ Proven growth in internal and external markets Certain acquisition of Quebecor Media stake Uncertain government regulation in the external marketplace

McMaster Investment Council Portfolio On February 2nd 2015 1,892 shares of Quebecor Inc. were purchased for a price of $31.85 representing 6.5% of the portfolio. We will continue to hold 1,892 shares of Quebecor that currently stand at a price of $33.73 with a total portfolio value of $63,817.16 This represents a return of +5.90% over a 1 year hold period