Lotoquebec to ensure that governmentsetexpense budgetary targets are met

In the wake of the Government of Quebec&8217;s budget LotoQuebec intends to put a program to reduce expenses and increaseproductivity in place which will enable it to meet the announced targets. Expense reductions and productivity increases willsave $5 million in the current fiscal year and achieve additional benefits of $25 $40 and $50 million in fiscal years 2011201220122013 and 20132014.

Well aware of the difficult budgetary context LotoQuebec will participate in the efforts requested of state corporationswhile as it continues to contribute to economic and tourism development in Quebec.

The new efforts come on top of previous steps as LotoQuebec succeeded in

• Constraining operational expense increases to levels comparable to the rate of inflation since 2003.
• Reducing the operations budget by $19 million for the last fiscal year in expectation of a less favourable business environment.

This exercise in controlling expenses will be accomplished without abandoning the main principles that guide the Corporationsoperations i.e. providing quality customer service maintaining game integrity and marketing its products responsibly.

For the current fiscal year LotoQuebec has agreed to pay a dividend that exceeds by $5 million the amount that was approvedby the Board of Directors. Measures have already been set up to guarantee that the additional amount will come entirely fromrecurring reductions to operational expenses.

In order to meet targets for subsequent fiscal years all business and corporate departments will participate in a rigorousexamination of operational expenses aimed at achieving permanent productivity gains.

In this regard particular attention will be paid to all operational expenses to ensure that they are essential to achievingour objectives.