- Strong progress on the strategic priorities announced last
quarter centered on synergies, digitization, advanced analytics,
network expansion and wireless, as well as transforming
our radio business.
- Successfully completed the combination of our Canadian and
U.S. telecommunications teams.
- Signed strategic partnerships to enable an upcoming launch
of wireless services in Canada, in
a capital-efficient manner as an MVNO.
- Met or exceeded all financial guidelines set for fiscal
2024; issuing fiscal 2025 financial guidelines.
- Increasing quarterly eligible dividend by 8.0%
to $0.922 per share.
MONTRÉAL, Oct. 31,
2024 /CNW/ - Today, Cogeco Inc. (TSX: CGO) ("Cogeco"
or the "Corporation") announced its financial results for the
fourth quarter ended August 31, 2024 and is issuing its fiscal
2025 financial guidelines.
"Fiscal 2024 has been a year of tremendous progress for Cogeco,"
said Frédéric Perron, President and CEO. "Over the last six months
alone, we set clear priorities to achieve sustainable growth,
launched wireless in the U.S., assembled the building blocks to
launch wireless in Canada as an
MVNO, successfully combined our Canadian and U.S. organizations and
refreshed our executive team. The recently completed restructuring,
which simplified our operating model, was the first phase of a
structured three-year program. We are now in a position to
accelerate our digital capabilities, drive bundling across wireline
and wireless, and continue to optimize our operations for ongoing
growth and value creation.
"Our Canadian telecommunications business continued to perform
well in Q4, driven by growth of our Internet subscriber base
through Cogeco Connexion, oxio, and our network expansion program.
We're particularly excited about our oxio brand's performance as
its digital model has not only become a growth engine for the
organization, but has also become a model for key transformation
initiatives within the Corporation more broadly.
"In the U.S., the launch of Breezeline Mobile provides customers
even more compelling reasons to bundle their services with us. Our
Internet-led strategy and focus on operational efficiency
contributed to another quarter of strong margin growth.
"While competitive dynamics in the radio advertising market
remain challenging, many of Cogeco Media's radio stations remained
high in the ratings again this quarter. Furthermore, our digital
advertising solutions continue to provide a growing contribution to
our overall revenue.
"Over the past year, we have maintained our balanced approach to
allocating capital to growth initiatives including network
expansion, product improvements, and a capital-light approach to
growing wireless services in both countries, as well as returning
capital through an increased dividend and share buybacks, all while
progressively reducing our leverage. We will continue with our
balanced approach in fiscal 2025 and with that, we are delighted to
announce an increase in our quarterly dividend per share to
$0.922."
Consolidated Financial Highlights
|
Three months ended
August 31
|
2024
|
|
2023
|
(1)
|
Change
|
Change in
constant
currency
|
(2)
|
|
(In thousands of
Canadian dollars, except % and per share data)
(unaudited)
|
$
|
|
$
|
|
%
|
%
|
|
|
Revenue
|
768,656
|
|
766,652
|
|
0.3
|
(1.0)
|
|
|
Adjusted EBITDA
(2)
|
371,216
|
|
351,925
|
|
5.5
|
4.2
|
|
|
Profit for the
period
|
81,437
|
|
90,521
|
|
(10.0)
|
|
|
|
Profit for the period
attributable to owners of the Corporation
|
19,248
|
|
29,234
|
|
(34.2)
|
|
|
|
Adjusted profit
attributable to owners of the Corporation
(2)(3)
|
25,562
|
|
33,006
|
|
(22.6)
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
operating activities
|
326,723
|
|
284,370
|
|
14.9
|
|
|
|
Free cash flow
(1)(2)
|
143,055
|
|
87,274
|
|
63.9
|
63.4
|
|
|
Free cash flow,
excluding network expansion projects (1)(2)
|
199,966
|
|
120,202
|
|
66.4
|
65.5
|
|
|
|
|
|
|
|
|
|
|
Acquisition of
property, plant and equipment
|
156,577
|
|
207,434
|
|
(24.5)
|
|
|
|
Net capital
expenditures (2)(4)
|
154,570
|
|
178,481
|
|
(13.4)
|
(14.7)
|
|
|
Net capital
expenditures, excluding network expansion projects
(2)
|
97,659
|
|
145,553
|
|
(32.9)
|
(34.1)
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
1.99
|
|
1.87
|
|
6.4
|
|
|
|
Adjusted diluted
earnings per share (2)(3)
|
2.65
|
|
2.12
|
|
25.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating results
For the fourth quarter of fiscal 2024 ended on August 31,
2024:
- Revenue remained stable at $768.7
million. On a constant currency basis(2), revenue
decreased by 1.0% due to a decline in revenue in the American
telecommunications segment and in the media activities, offset in
part by revenue growth in the Canadian telecommunications segment,
as explained below.
- American telecommunications' revenue decreased by 2.3% in
constant currency (remained stable as reported), mainly due to a
decline in its subscriber base, especially for entry-level
services, and a higher proportion of customers subscribing to
Internet-only services. The decline was offset in part by higher
revenue per subscriber and a better product mix resulting from
improving subscriber metrics.
- Revenue in the media activities decreased by 10.1% as
competitive dynamics in the radio advertising market remain
challenging.
- Canadian telecommunications' revenue increased by 0.8%, mostly
driven by the cumulative effect of high-speed Internet service
additions over the past year, including from network expansion
projects, as well as the Niagara Regional Broadband Network
acquisition completed on February 5,
2024.
- Adjusted EBITDA increased by 5.5% to $371.2 million. On a constant currency basis,
adjusted EBITDA increased by 4.2%, mainly due to higher adjusted
EBITDA in both the Canadian and American telecommunications
segments, driven by cost reduction initiatives and operating
efficiencies across the Corporation as a result of our ongoing
transformation program, in addition to revenue growth in the
Canadian telecommunications segment.
- Canadian telecommunications adjusted EBITDA increased by 3.8%,
or 4.0% in constant currency.
- American telecommunications adjusted EBITDA increased by 5.2%,
or 2.4% in constant currency.
- Profit for the period amounted to $81.4
million, of which $19.2
million, or $1.99 per diluted
share, was attributable to owners of the Corporation compared to
$90.5 million, $29.2 million, and $1.87 per diluted share, respectively, in the
comparable period of fiscal 2023. The decreases in profit for the
period and profit attributable to owners of the Corporation
resulted mainly from higher depreciation and amortization expense
and non-cash pre-tax impairment charges of $15.2 million recognized during the quarter
mostly in relation to strategic partnerships to facilitate the
development of wireless services in Canada under a capital-light operating model,
partly offset by higher adjusted EBITDA and lower financial
expense.
- Adjusted profit attributable to owners of the
Corporation(3) was $25.6
million, or $2.65 per diluted
share(3), compared to $33.0
million, or $2.12 per diluted
share, last year. The increase of adjusted diluted earnings per
share over last year reflects the benefit of the Corporation's
share buybacks.
- Net capital expenditures were $154.6
million, a decrease of 13.4% compared to $178.5 million in the same period of the prior
year. In constant currency, net capital expenditures(2)
were $152.3 million, a decrease
of 14.7% compared to last year, mainly resulting from lower
spending due to the timing of network expansion projects in both
the American and Canadian telecommunications segments, in addition
to drawdowns of previously accumulated customer premise equipment
inventory in the American telecommunications segment.
- Excluding network expansion projects, net capital expenditures
were $97.7 million, a decrease of
32.9% compared to $145.6 million in
the same period of the prior year. In constant currency, net
capital expenditures, excluding network expansion
projects(2) were $96.0 million, a decrease of 34.1% compared
to last year.
- Fibre-to-the-home network expansion projects continued in both
Canada and the United States by adding close to
58,000(5) homes passed during fiscal 2024, of which
close to 14,000(5) were in the fourth quarter.
- Acquisition of property, plant and equipment decreased by 24.5%
to $156.6 million, mainly resulting
from lower spending.
- Free cash flow(1) increased by 63.9%, or 63.4% in
constant currency, and amounted to $143.1
million, or $142.6 million in
constant currency, mainly due to lower net capital expenditures,
higher adjusted EBITDA and lower financial expense. Free cash flow,
excluding network expansion projects(1) increased by
66.4%, or 65.5% in constant currency, and amounted to $200.0 million, or $198.9 million in constant currency.
- Cash flows from operating activities increased by 14.9% to
$326.7 million, mainly from the
timing of payments of trade and other payables and higher adjusted
EBITDA.
- At its October 31, 2024 meeting,
the Board of Directors of Cogeco declared a quarterly eligible
dividend of $0.922 per share, an
increase of 8.0% compared to $0.854
per share last year.
FISCAL 2025 FINANCIAL GUIDELINES
Cogeco released its fiscal 2025 financial guidelines. Fiscal
2025 will be the first year of a three-year transformation program,
where investments are made in order to set the Corporation on a
path to sustainable growth. On a constant currency basis, the
Corporation expects fiscal 2025 revenue to remain stable resulting
from a combination of Internet subscriber growth and a decline in
video and wireline phone subscriptions. On a constant currency
basis, fiscal 2025 adjusted EBITDA is anticipated to remain stable,
mainly due to stable revenue as well as stable operating expenses,
which are anticipated to benefit from the recent corporate
reorganization and other operational improvements, offset by
investments into new capabilities as part of a three-year
transformation program. Net capital expenditures are anticipated to
be between $660 and $735 million, including net investments of
approximately $140 to $190 million in growth-oriented network
expansions, which will increase the Corporation's footprint in
Canada and the United States. Free cash flow and free
cash flow, excluding network expansion projects, are expected to
decrease between 0% and 10% due to stronger than anticipated free
cash flow in fiscal 2024, continued growth-oriented investments,
and higher financial expense and current income tax.
|
|
|
|
|
October 31,
2024
|
|
|
|
Projections
|
(i)
|
Actual
|
|
Fiscal
2025
(constant
currency)
|
(ii)
|
Fiscal 2024
|
|
(In millions of
Canadian dollars, except percentages)
|
$
|
|
$
|
|
|
|
|
|
Financial
guidelines
|
|
|
|
|
Revenue
|
Stable
|
|
3,074
|
|
Adjusted
EBITDA
|
Stable
|
|
1,455
|
|
Net capital
expenditures
|
$660 to
$735
|
|
643
|
|
Net capital
expenditures in connection with network expansion
projects
|
$140 to
$190
|
|
137
|
|
Free cash
flow
|
Decrease of 0% to
10%
|
(iii)
|
476
|
|
Free cash flow,
excluding network expansion projects
|
Decrease of 0% to
10%
|
(iii)
|
613
|
|
|
|
|
|
(i)
|
Percentage of changes
compared to fiscal 2024.
|
|
(ii)
|
Fiscal 2025 financial
guidelines are based on a USD/CDN constant exchange rate of 1.3606
USD/CDN.
|
|
(iii)
|
The assumed current
income tax effective rate is approximately 14%.
|
These financial guidelines, including the various assumptions
underlying them, contain forward-looking statements concerning the
business outlook for Cogeco, and should be read in conjunction with
the "Forward-looking statements" section of this press release.
|
|
(1)
|
During the fourth
quarter of fiscal 2024, the Corporation updated its calculation of
free cash flow and free cash flow, excluding network expansion
projects, to include proceeds on disposals of property, plant and
equipment. Comparative figures were restated to conform to the
current presentation. For further details, please refer to the
"Non-IFRS Accounting Standards and other financial measures"
section of this press release.
|
|
(2)
|
Adjusted EBITDA and net
capital expenditures are total of segments measures. Constant
currency basis, adjusted profit attributable to owners of the
Corporation, net capital expenditures, excluding network expansion
projects, free cash flow and free cash flow, excluding network
expansion projects are non-IFRS Accounting Standards measures.
Change in constant currency and adjusted diluted earnings per share
are non-IFRS Accounting Standards ratios. These indicated terms do
not have standardized definitions prescribed by IFRS®
Accounting Standards, as issued by the International Accounting
Standards Board ("IFRS Accounting Standards") and therefore, may
not be comparable to similar measures presented by other companies.
For more information on these financial measures, please consult
the "Non-IFRS Accounting Standards and other financial measures"
section of this press release.
|
|
(3)
|
Excludes the impact of
non-cash impairment charges, and acquisition, integration,
restructuring and other costs, net of tax and non-controlling
interest.
|
|
(4)
|
Net capital
expenditures exclude non-cash acquisitions of right-of-use assets
and the purchases, and related borrowing costs, of spectrum
licences, and are presented net of government subsidies, including
the utilization of those received in advance.
|
|
(5)
|
Organic growth
calculated by excluding additions resulting from
acquisitions.
|
Financial highlights
|
Three months and
years ended August 31
|
2024
|
2023
|
(1)
|
Change
|
Change in
constant
currency
|
(2)
(3)
|
2024
|
2023
|
(1)
|
Change
|
Change in
constant
currency
|
(2)
(3)
|
|
(In thousands of
Canadian dollars, except % and per share data)
|
$
|
$
|
|
%
|
%
|
|
$
|
$
|
|
%
|
%
|
|
|
Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
768,656
|
766,652
|
|
0.3
|
(1.0)
|
|
3,073,985
|
3,081,136
|
|
(0.2)
|
(0.7)
|
|
|
Adjusted EBITDA
(3)
|
371,216
|
351,925
|
|
5.5
|
4.2
|
|
1,454,817
|
1,432,929
|
|
1.5
|
1.0
|
|
|
Acquisition,
integration, restructuring and other costs
(4)
|
12,177
|
15,239
|
|
(20.1)
|
|
|
63,298
|
36,245
|
|
74.6
|
|
|
|
Impairment of property,
plant and equipment, intangible assets and goodwill
|
15,229
|
—
|
|
—
|
|
|
15,229
|
88,000
|
|
(82.7)
|
|
|
|
Profit for the
period
|
81,437
|
90,521
|
|
(10.0)
|
|
|
349,381
|
350,235
|
|
(0.2)
|
|
|
|
Profit for the period
attributable to owners of the Corporation
|
19,248
|
29,234
|
|
(34.2)
|
|
|
96,746
|
70,630
|
|
37.0
|
|
|
|
Adjusted profit
attributable to owners of the Corporation
(3)(5)
|
25,562
|
33,006
|
|
(22.6)
|
|
|
119,048
|
149,298
|
|
(20.3)
|
|
|
|
Cash
flow
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
operating activities
|
326,723
|
284,370
|
|
14.9
|
|
|
1,185,150
|
968,214
|
|
22.4
|
|
|
|
Free cash flow
(1)(3)
|
143,055
|
87,274
|
|
63.9
|
63.4
|
|
475,765
|
424,083
|
|
12.2
|
12.0
|
|
|
Free cash flow,
excluding network expansion projects (1)(3)
|
199,966
|
120,202
|
|
66.4
|
65.5
|
|
613,159
|
596,918
|
|
2.7
|
2.4
|
|
|
Acquisition of
property, plant and equipment
|
156,577
|
207,434
|
|
(24.5)
|
|
|
664,004
|
806,237
|
|
(17.6)
|
|
|
|
Net capital
expenditures (3)(6)
|
154,570
|
178,481
|
|
(13.4)
|
(14.7)
|
|
642,747
|
702,913
|
|
(8.6)
|
(9.0)
|
|
|
Net capital
expenditures, excluding network expansion projects
(3)
|
97,659
|
145,553
|
|
(32.9)
|
(34.1)
|
|
505,353
|
530,078
|
|
(4.7)
|
(5.1)
|
|
|
Per share data
(7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
2.02
|
1.89
|
|
6.9
|
|
|
8.63
|
4.53
|
|
90.5
|
|
|
|
Diluted
|
1.99
|
1.87
|
|
6.4
|
|
|
8.55
|
4.51
|
|
89.6
|
|
|
|
Adjusted diluted
(3)(5)
|
2.65
|
2.12
|
|
25.0
|
|
|
10.52
|
9.53
|
|
10.4
|
|
|
|
Dividends per
share
|
0.854
|
0.731
|
|
16.8
|
|
|
3.416
|
2.924
|
|
16.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
During the fourth
quarter of fiscal 2024, the Corporation updated its calculation of
free cash flow and free cash flow, excluding network expansion
projects, to include proceeds on disposals of property, plant and
equipment. Proceeds on disposals of property, plant and equipment
amounted to $0.6 million and $3.4 million for the three-month
period and year ended August 31, 2024, respectively ($1.0
million and $2.7 million, respectively, in fiscal 2023).
Comparative figures were restated to conform to the current
presentation. For further details, please refer to the "Non-IFRS
Accounting Standards and other financial measures" section of this
press release.
|
|
(2)
|
Key performance
indicators presented on a constant currency basis are obtained by
translating financial results from the current periods denominated
in US dollars at the foreign exchange rate of the comparable
periods of the prior year. For the three-month period and year
ended August 31, 2023, the average foreign exchange rates used for
translation were 1.3329 USD/CDN and 1.3467 USD/CDN,
respectively.
|
|
(3)
|
Adjusted EBITDA and net
capital expenditures are total of segments measures. Adjusted
profit attributable to owners of the Corporation, free cash flow,
free cash flow, excluding network expansion projects and net
capital expenditures, excluding network expansion projects are
non-IFRS Accounting Standards measures. Change in constant currency
and adjusted diluted earnings per share are non-IFRS Accounting
Standards ratios. These indicated terms do not have standardized
definitions prescribed by IFRS Accounting Standards and therefore,
may not be comparable to similar measures presented by other
companies. For more information on these financial measures, please
consult the "Non-IFRS Accounting Standards and other financial
measures" section of this press release.
|
|
(4)
|
For the three-month
period and year ended August 31, 2024, acquisition, integration,
restructuring and other costs were mostly related to restructuring
costs recognized during the second half of the year, including
costs related to the new organizational structure announced in May
2024 and other cost optimization initiatives. For the three-month
period and year ended August 31, 2023, acquisition, integration,
restructuring and other costs resulted mostly from costs related to
the integration of past acquisitions, as well as acquisition and
integration costs incurred in connection with the acquisition of
oxio, completed on March 3, 2023, from restructuring costs
associated with organizational changes during the fourth quarter of
fiscal 2023 within the Canadian and the American telecommunications
segments and from configuration and customization costs related to
cloud computing arrangements. Furthermore, a retroactive adjustment
of $8.4 million was recognized in fiscal 2023 following the
Copyright Board preliminary conclusions on the redetermination of
the 2014-2018 royalty rates, of which $4.2 million was reversed
during the second quarter of fiscal 2024 following the Copyright
Board decision issued in January 2024.
|
|
(5)
|
Excludes the impact of
non-cash impairment charges, acquisition, integration,
restructuring and other costs, and gains/losses on debt
modification and/or extinguishment, all net of tax and
non-controlling interest.
|
|
(6)
|
Net capital
expenditures exclude non-cash acquisitions of right-of-use assets
and the purchases, and related borrowing costs, of spectrum
licences, and are presented net of government subsidies, including
the utilization of those received in advance.
|
|
(7)
|
Per multiple and
subordinate voting share.
|
|
As at
|
August 31,
2024
|
August 31,
2023
|
|
(In thousands of
Canadian dollars, except %)
|
$
|
$
|
|
Financial
condition
|
|
|
|
Cash and cash
equivalents
|
77,746
|
363,854
|
|
Total assets
|
9,773,739
|
9,869,778
|
|
Long-term
debt
|
|
|
|
Current
|
370,108
|
43,325
|
|
Non-current
|
4,594,057
|
5,045,672
|
|
Net indebtedness
(1)
|
4,957,594
|
4,817,113
|
|
Equity attributable to
owners of the Corporation
|
810,437
|
925,863
|
|
Return on equity
(2)
|
11.1 %
|
7.7 %
|
|
|
|
|
(1)
|
Net indebtedness is a
capital management measure. For more information on this financial
measure, please consult the "Non-IFRS Accounting Standards and
other financial measures" section of the Corporation's MD&A for
the year ended August 31, 2024, available on SEDAR+
at www.sedarplus.ca.
|
|
(2)
|
Return on equity is a
supplementary financial measure and is calculated as profit
attributable to owners of the Corporation for the year divided by
the average of the equity attributable to owners of the Corporation
for the year.
|
Forward-looking statements
Certain statements contained in this press
release may constitute forward-looking information within the
meaning of securities laws. Forward-looking information may relate
to Cogeco Inc.'s ("Cogeco" or the "Corporation") future outlook and
anticipated events, business, operations, financial performance,
financial condition or results and, in some cases, can be
identified by terminology such as "may"; "will"; "should";
"expect"; "plan"; "anticipate"; "believe"; "intend"; "estimate";
"predict"; "potential"; "continue"; "foresee", "ensure" or other
similar expressions concerning matters that are not historical
facts. Particularly, statements relating to the Corporation's
financial guidelines, future operating results and economic
performance, objectives and strategies are forward-looking
statements. These statements are based on certain factors and
assumptions including expected growth, results of operations,
purchase price allocation, tax rates, weighted average cost of
capital, performance and business prospects and opportunities,
which Cogeco believes are reasonable as of the current date. Refer
in particular to the "Corporate objectives and strategy" and
"Fiscal 2025 financial guidelines" sections of the Corporation's
Fiscal 2024 annual Management's Discussion and Analysis
("MD&A") for a discussion of certain key economic, market and
operational assumptions we have made in preparing forward-looking
statements. While management considers these assumptions to be
reasonable based on information currently available to the
Corporation, they may prove to be incorrect. Forward-looking
information is also subject to certain factors, including risks and
uncertainties that could cause actual results to differ materially
from what Cogeco currently expects. These factors include risks
such as general market conditions, competitive risks (including
changing competitive and technology ecosystems and disruptive
competitive strategies adopted by our competitors), business risks,
regulatory risks, tax risks, technology risks (including
cybersecurity), financial risks (including variations in currency
and interest rates), economic conditions (including inflation
pressuring revenue, reduced consumer spending and increasing
costs), talent management risks (including the highly competitive
market for a limited pool of digitally skilled employees),
human-caused and natural threats to the Corporation's network
(including increased frequency of extreme weather events with the
potential to disrupt operations), infrastructure and systems,
sustainability and sustainability reporting risks, ethical behavior
risks, ownership risks, litigation risks and public health and
safety, many of which are beyond the Corporation's control.
Moreover, the Corporation's radio operations are significantly
exposed to advertising budgets from the retail industry, which can
fluctuate due to increased competition and changing economic
conditions. For more exhaustive information on these risks and
uncertainties, the reader should refer to the "Uncertainties and
main risk factors" section of the Corporation's Fiscal 2024 annual
MD&A. These factors are not intended to represent a complete
list of the factors that could affect Cogeco and future events and
results may vary significantly from what management currently
foresees. The reader should not place undue importance on
forward-looking information contained in this press release and the
forward-looking statements contained in this press release
represent Cogeco's expectations as of the date of this press
release (or as of the date they are otherwise stated to be made)
and are subject to change after such date. While management may
elect to do so, the Corporation is under no obligation (and
expressly disclaims any such obligation) and does not undertake to
update or alter this information at any particular time, whether as
a result of new information, future events or otherwise, except as
required by law.
All amounts are stated in Canadian dollars unless otherwise
indicated. This press release should be read in
conjunction with the MD&A included in the Corporation's Fiscal
2024 Annual Report, the Corporation's consolidated financial
statements and the notes thereto prepared in accordance with
IFRS® Accounting Standards as issued by the
International Accounting Standards Board ("IFRS Accounting
Standards") for the year ended August 31,
2024.
Non-IFRS Accounting Standards and other financial
measures
This press release includes references to non-IFRS Accounting
Standards and other financial measures used by Cogeco. These
financial measures are reviewed in assessing the performance of
Cogeco and used in the decision-making process with regard to its
business units.
Reconciliations between non-IFRS Accounting Standards and other
financial measures to the most directly comparable IFRS Accounting
Standards measures are provided below. Certain additional
disclosures for non-IFRS Accounting Standards and other financial
measures used in this press release have been incorporated by
reference and can be found in the "Non-IFRS Accounting Standards
and other financial measures" section of the Corporation's
MD&A for the year ended August 31, 2024, available on
SEDAR+ at www.sedarplus.ca. The following non-IFRS Accounting
Standards measures are used as a component of Cogeco's non-IFRS
Accounting Standards ratios.
|
|
|
Specified non-IFRS
Accounting Standards measure
|
Used in the
component of the following non-IFRS Accounting Standards
ratio
|
|
Adjusted profit
attributable to owners of the Corporation
|
Adjusted diluted
earnings per share
|
|
|
Financial measures presented on a constant currency basis
for the three-month period and year ended August 31, 2024
are translated at the average foreign exchange rate of the
comparable periods of the prior year, which were 1.3329 USD/CDN and 1.3467
USD/CDN, respectively.
Constant currency basis and foreign exchange impact
reconciliation
Consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
August 31
|
2024
|
|
2023
|
(1)
|
|
|
Change
|
|
|
(In thousands of
Canadian dollars, except percentages)
|
Actual
|
|
Foreign
exchange
impact
|
|
In
constant
currency
|
|
Actual
|
|
Actual
|
|
In
constant
currency
|
|
|
$
|
|
$
|
|
$
|
|
$
|
|
%
|
|
%
|
|
|
Revenue
|
768,656
|
|
(9,731)
|
|
758,925
|
|
766,652
|
|
0.3
|
|
(1.0)
|
|
|
Operating
expenses
|
397,440
|
|
(5,234)
|
|
392,206
|
|
414,727
|
|
(4.2)
|
|
(5.4)
|
|
|
Adjusted
EBITDA
|
371,216
|
|
(4,497)
|
|
366,719
|
|
351,925
|
|
5.5
|
|
4.2
|
|
|
Free cash flow
(1)
|
143,055
|
|
(462)
|
|
142,593
|
|
87,274
|
|
63.9
|
|
63.4
|
|
|
Net capital
expenditures
|
154,570
|
|
(2,254)
|
|
152,316
|
|
178,481
|
|
(13.4)
|
|
(14.7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
During the fourth
quarter of fiscal 2024, the Corporation updated its free cash flow
calculation to include proceeds on disposals of property, plant and
equipment. Comparative figures were restated to conform to the
current presentation.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years ended August
31
|
2024
|
|
2023
|
(1)
|
|
|
Change
|
|
|
(In thousands of
Canadian dollars, except percentages)
|
Actual
|
|
Foreign
exchange
impact
|
|
In
constant
currency
|
|
Actual
|
|
Actual
|
|
In
constant
currency
|
|
|
$
|
|
$
|
|
$
|
|
$
|
|
%
|
|
%
|
|
|
Revenue
|
3,073,985
|
|
(15,024)
|
|
3,058,961
|
|
3,081,136
|
|
(0.2)
|
|
(0.7)
|
|
|
Operating
expenses
|
1,619,168
|
|
(8,121)
|
|
1,611,047
|
|
1,648,207
|
|
(1.8)
|
|
(2.3)
|
|
|
Adjusted
EBITDA
|
1,454,817
|
|
(6,903)
|
|
1,447,914
|
|
1,432,929
|
|
1.5
|
|
1.0
|
|
|
Free cash flow
(1)
|
475,765
|
|
(932)
|
|
474,833
|
|
424,083
|
|
12.2
|
|
12.0
|
|
|
Net capital
expenditures
|
642,747
|
|
(3,340)
|
|
639,407
|
|
702,913
|
|
(8.6)
|
|
(9.0)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
During the fourth
quarter of fiscal 2024, the Corporation updated its free cash flow
calculation to include proceeds on disposals of property, plant and
equipment. Comparative figures were restated to conform to the
current presentation.
|
Canadian telecommunications segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
August 31
|
2024
|
|
2023
|
|
|
|
Change
|
|
|
(In thousands of
Canadian dollars, except percentages)
|
Actual
|
|
Foreign
exchange
impact
|
|
In
constant
currency
|
|
Actual
|
|
Actual
|
|
In
constant
currency
|
|
|
$
|
|
$
|
|
$
|
|
$
|
|
%
|
|
%
|
|
|
Revenue
|
378,702
|
|
—
|
|
378,702
|
|
375,754
|
|
0.8
|
|
0.8
|
|
|
Operating
expenses
|
175,688
|
|
(288)
|
|
175,400
|
|
180,183
|
|
(2.5)
|
|
(2.7)
|
|
|
Adjusted
EBITDA
|
203,014
|
|
288
|
|
203,302
|
|
195,571
|
|
3.8
|
|
4.0
|
|
|
Net capital
expenditures
|
71,000
|
|
(245)
|
|
70,755
|
|
73,348
|
|
(3.2)
|
|
(3.5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years ended August
31
|
2024
|
|
2023
|
|
|
|
Change
|
|
|
(In thousands of
Canadian dollars, except percentages)
|
Actual
|
|
Foreign
exchange
impact
|
|
In
constant
currency
|
|
Actual
|
|
Actual
|
|
In
constant
currency
|
|
|
$
|
|
$
|
|
$
|
|
$
|
|
%
|
|
%
|
|
|
Revenue
|
1,510,506
|
|
—
|
|
1,510,506
|
|
1,489,915
|
|
1.4
|
|
1.4
|
|
|
Operating
expenses
|
710,706
|
|
(447)
|
|
710,259
|
|
701,717
|
|
1.3
|
|
1.2
|
|
|
Adjusted
EBITDA
|
799,800
|
|
447
|
|
800,247
|
|
788,198
|
|
1.5
|
|
1.5
|
|
|
Net capital
expenditures
|
356,274
|
|
(463)
|
|
355,811
|
|
354,384
|
|
0.5
|
|
0.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
American telecommunications segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
August 31
|
2024
|
|
2023
|
|
|
|
Change
|
|
|
(In thousands of
Canadian dollars, except percentages)
|
Actual
|
|
Foreign
exchange
impact
|
|
In
constant
currency
|
|
Actual
|
|
Actual
|
|
In
constant
currency
|
|
|
$
|
|
$
|
|
$
|
|
$
|
|
%
|
|
%
|
|
|
Revenue
|
369,049
|
|
(9,731)
|
|
359,318
|
|
367,643
|
|
0.4
|
|
(2.3)
|
|
|
Operating
expenses
|
185,588
|
|
(4,916)
|
|
180,672
|
|
193,172
|
|
(3.9)
|
|
(6.5)
|
|
|
Adjusted
EBITDA
|
183,461
|
|
(4,815)
|
|
178,646
|
|
174,471
|
|
5.2
|
|
2.4
|
|
|
Net capital
expenditures
|
76,238
|
|
(2,011)
|
|
74,227
|
|
100,488
|
|
(24.1)
|
|
(26.1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years ended August
31
|
2024
|
|
2023
|
|
|
|
Change
|
|
|
(In thousands of
Canadian dollars, except percentages)
|
Actual
|
|
Foreign
exchange
impact
|
|
In
constant
currency
|
|
Actual
|
|
Actual
|
|
In
constant
currency
|
|
|
$
|
|
$
|
|
$
|
|
$
|
|
%
|
|
%
|
|
|
Revenue
|
1,466,018
|
|
(15,024)
|
|
1,450,994
|
|
1,494,213
|
|
(1.9)
|
|
(2.9)
|
|
|
Operating
expenses
|
759,658
|
|
(7,632)
|
|
752,026
|
|
800,409
|
|
(5.1)
|
|
(6.0)
|
|
|
Adjusted
EBITDA
|
706,360
|
|
(7,392)
|
|
698,968
|
|
693,804
|
|
1.8
|
|
0.7
|
|
|
Net capital
expenditures
|
267,728
|
|
(2,865)
|
|
264,863
|
|
336,910
|
|
(20.5)
|
|
(21.4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted profit attributable to owners of the
Corporation
|
|
|
|
|
|
Three months ended
August 31
|
Years ended August
31
|
|
2024
|
2023
|
2024
|
2023
|
|
(In thousands of
Canadian dollars)
|
$
|
$
|
$
|
$
|
|
Profit for the
period attributable to owners of the Corporation
|
19,248
|
29,234
|
96,746
|
70,630
|
|
Impairment of property,
plant and equipment, intangible assets and goodwill
|
15,229
|
—
|
15,229
|
88,000
|
|
Acquisition,
integration, restructuring and other costs
|
12,177
|
15,239
|
63,298
|
36,245
|
|
Loss on debt
extinguishment (1)
|
—
|
—
|
16,880
|
—
|
|
Tax impact for the
above items
|
(7,173)
|
(3,832)
|
(25,151)
|
(27,770)
|
|
Non-controlling
interest impact for the above items
|
(13,919)
|
(7,635)
|
(47,954)
|
(17,807)
|
|
Adjusted profit
attributable to owners of the Corporation
|
25,562
|
33,006
|
119,048
|
149,298
|
|
|
|
|
|
|
(1)
|
Included within
financial expense.
|
Free cash flow and free cash flow, excluding network
expansion projects reconciliations
|
|
|
|
|
|
|
|
Three months ended
August 31
|
|
Years ended August
31
|
|
|
2024
|
2023
|
(1)
|
2024
|
2023
|
(1)
|
|
(In thousands of
Canadian dollars)
|
$
|
$
|
|
$
|
$
|
|
|
Cash flows from
operating activities
|
326,723
|
284,370
|
|
1,185,150
|
968,214
|
|
|
Changes in other
non-cash operating activities
|
(44,264)
|
(12,970)
|
|
(58,459)
|
102,422
|
|
|
Income taxes
paid
|
6,124
|
2,190
|
|
4,890
|
91,968
|
|
|
Current income
taxes
|
(682)
|
(5,523)
|
|
(20,995)
|
(31,973)
|
|
|
Interest
paid
|
74,150
|
66,544
|
|
275,283
|
243,321
|
|
|
Financial
expense
|
(64,461)
|
(71,198)
|
|
(286,672)
|
(255,010)
|
|
|
Loss on debt
extinguishment (2)
|
—
|
—
|
|
16,880
|
—
|
|
|
Amortization of
deferred transaction costs and discounts on long-term debt
(2)
|
2,257
|
3,212
|
|
9,336
|
12,672
|
|
|
Net capital
expenditures (3)
|
(154,570)
|
(178,481)
|
|
(642,747)
|
(702,913)
|
|
|
Proceeds on disposals of property, plant and
equipment (1)
|
594
|
1,037
|
|
3,381
|
2,653
|
|
|
Repayment of lease
liabilities
|
(2,816)
|
(1,907)
|
|
(10,282)
|
(7,271)
|
|
|
Free cash flow
(1)
|
143,055
|
87,274
|
|
475,765
|
424,083
|
|
|
Net capital
expenditures in connection with network expansion
projects
|
56,911
|
32,928
|
|
137,394
|
172,835
|
|
|
Free cash flow,
excluding network expansion projects (1)
|
199,966
|
120,202
|
|
613,159
|
596,918
|
|
|
|
|
|
|
|
|
|
(1)
|
During the fourth
quarter of fiscal 2024, the Corporation updated its calculation of
free cash flow and free cash flow, excluding network expansion
projects, to include proceeds on disposals of property, plant
and equipment. Comparative figures were restated to conform to the
current presentation.
|
|
(2)
|
Included within
financial expense.
|
|
(3)
|
Net capital
expenditures exclude non-cash acquisitions of right-of-use assets
and the purchases, and related borrowing costs, of spectrum
licences, and are presented net of government subsidies, including
the utilization of those received in advance.
|
Net capital expenditures reconciliation
|
|
|
|
|
|
Three months ended
August 31
|
Years ended August
31
|
|
2024
|
2023
|
2024
|
2023
|
|
(In thousands of
Canadian dollars)
|
$
|
$
|
$
|
$
|
|
Acquisition of
property, plant and equipment
|
156,577
|
207,434
|
664,004
|
806,237
|
|
Subsidies received in
advance recognized as a reduction of the cost of property, plant
and equipment during the period
|
(2,007)
|
(28,953)
|
(21,257)
|
(103,324)
|
|
Net capital
expenditures
|
154,570
|
178,481
|
642,747
|
702,913
|
|
|
|
|
|
Adjusted EBITDA reconciliation
|
|
|
|
|
|
Three months ended
August 31
|
Years ended August
31
|
|
2024
|
2023
|
2024
|
2023
|
|
(In thousands of
Canadian dollars)
|
$
|
$
|
$
|
$
|
|
Profit for the
period
|
81,437
|
90,521
|
349,381
|
350,235
|
|
Income taxes
|
14,262
|
17,827
|
61,808
|
78,379
|
|
Financial
expense
|
64,461
|
71,198
|
286,672
|
255,010
|
|
Impairment of property,
plant and equipment, intangible assets and goodwill
|
15,229
|
—
|
15,229
|
88,000
|
|
Depreciation and
amortization
|
183,650
|
157,140
|
678,429
|
625,060
|
|
Acquisition,
integration, restructuring and other costs
|
12,177
|
15,239
|
63,298
|
36,245
|
|
Adjusted
EBITDA
|
371,216
|
351,925
|
1,454,817
|
1,432,929
|
|
|
|
|
|
Net capital expenditures and free cash flow excluding network
expansion projects reconciliations
Net capital expenditures
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
August 31
|
2024
|
|
2023
|
|
|
|
Change
|
|
(In thousands of
Canadian dollars, except percentages)
|
Actual
|
|
Foreign
exchange
impact
|
|
In
constant
currency
|
|
Actual
|
|
Actual
|
|
In
constant
currency
|
|
$
|
|
$
|
|
$
|
|
$
|
|
%
|
|
%
|
|
Net capital
expenditures
|
154,570
|
|
(2,254)
|
|
152,316
|
|
178,481
|
|
(13.4)
|
|
(14.7)
|
|
Net capital
expenditures in connection with network expansion
projects
|
56,911
|
|
(576)
|
|
56,335
|
|
32,928
|
|
72.8
|
|
71.1
|
|
Net capital
expenditures, excluding network expansion projects
|
97,659
|
|
(1,678)
|
|
95,981
|
|
145,553
|
|
(32.9)
|
|
(34.1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years ended August
31
|
2024
|
|
2023
|
|
|
|
Change
|
|
(In thousands of
Canadian dollars, except percentages)
|
Actual
|
|
Foreign
exchange
impact
|
|
In
constant
currency
|
|
Actual
|
|
Actual
|
|
In
constant
currency
|
|
$
|
|
$
|
|
$
|
|
$
|
|
%
|
|
%
|
|
Net capital
expenditures
|
642,747
|
|
(3,340)
|
|
639,407
|
|
702,913
|
|
(8.6)
|
|
(9.0)
|
|
Net capital
expenditures in connection with network expansion
projects
|
137,394
|
|
(780)
|
|
136,614
|
|
172,835
|
|
(20.5)
|
|
(21.0)
|
|
Net capital
expenditures, excluding network expansion projects
|
505,353
|
|
(2,560)
|
|
502,793
|
|
530,078
|
|
(4.7)
|
|
(5.1)
|
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flow
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
August 31
|
2024
|
|
2023
|
(1)
|
|
|
Change
|
|
(In thousands of
Canadian dollars, except percentages)
|
Actual
|
|
Foreign
exchange
impact
|
|
In
constant
currency
|
|
Actual
|
|
Actual
|
|
In
constant
currency
|
|
$
|
|
$
|
|
$
|
|
$
|
|
%
|
|
%
|
|
Free cash flow
(1)
|
143,055
|
|
(462)
|
|
142,593
|
|
87,274
|
|
63.9
|
|
63.4
|
|
Net capital
expenditures in connection with network expansion
projects
|
56,911
|
|
(576)
|
|
56,335
|
|
32,928
|
|
72.8
|
|
71.1
|
|
Free cash flow,
excluding network expansion projects (1)
|
199,966
|
|
(1,038)
|
|
198,928
|
|
120,202
|
|
66.4
|
|
65.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
During the fourth
quarter of fiscal 2024, the Corporation updated its calculation of
free cash flow and free cash flow, excluding network expansion
projects, to include proceeds on disposals of property, plant
and equipment. Comparative figures were restated to conform to the
current presentation.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years ended August
31
|
2024
|
|
2023
|
(1)
|
|
|
Change
|
|
(In thousands of
Canadian dollars, except percentages)
|
Actual
|
|
Foreign
exchange
impact
|
|
In
constant
currency
|
|
Actual
|
|
Actual
|
|
In
constant
currency
|
|
$
|
|
$
|
|
$
|
|
$
|
|
%
|
|
%
|
|
Free cash flow
(1)
|
475,765
|
|
(932)
|
|
474,833
|
|
424,083
|
|
12.2
|
|
12.0
|
|
Net capital
expenditures in connection with network expansion
projects
|
137,394
|
|
(780)
|
|
136,614
|
|
172,835
|
|
(20.5)
|
|
(21.0)
|
|
Free cash flow,
excluding network expansion projects (1)
|
613,159
|
|
(1,712)
|
|
611,447
|
|
596,918
|
|
2.7
|
|
2.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
During the fourth
quarter of fiscal 2024, the Corporation updated its calculation of
free cash flow and free cash flow, excluding network expansion
projects, to include proceeds on disposals of property, plant
and equipment. Comparative figures were restated to conform to the
current presentation.
|
Additional information
Additional information relating to the Corporation, including
its Annual Information Form, is available on SEDAR+ at
www.sedarplus.ca and on the Corporation's website at
corpo.cogeco.com.
About Cogeco Inc.
Cogeco Inc. is a North American leader in the telecommunications
and media sectors. Through Cogeco Communications Inc., we provide
world-class Internet, video and wireline phone services to 1.6
million residential and business subscribers in Canada and thirteen states in the United States. We also offer wireless
services in most of our U.S. operating territory. Through Cogeco
Media, we operate 21 radio stations in Canada, primarily in the province of Québec,
as well as a news agency. We take pride in our strong presence in
the communities we serve and in our commitment to a sustainable
future. Both Cogeco Inc.'s and Cogeco Communications Inc.'s
subordinate voting shares are listed on the Toronto Stock Exchange
(TSX: CGO and CCA).
For information:
Investors
Troy
Crandall
Head, Investor Relations
Cogeco Inc.
Tel.: 514 764-4600
troy.crandall@cogeco.com
Media
Claudja Joseph
Director, Communications & DEI
Cogeco Inc.
Tel.: 514 764-4600
claudja.joseph@cogeco.com
|
Conference
Call:
|
Friday, November
1st, 2024 at 11:00 a.m.
(Eastern Daylight Time)
|
|
|
|
A live audio of the
analyst conference call will be available on both the Investor
Relations and the Events and Presentations pages on Cogeco's
website. Financial analysts will be able to access the live
conference call and ask questions. Media representatives may attend
as listeners only. A recording of the conference call will be
available on Cogeco's website for a three-month period.
|
|
|
|
Please use the
following dial-in number to access the conference call 10 minutes
before the start of the conference:
|
|
|
|
Local - Toronto: 1
289 514-5100
|
|
Toll Free - North
America: 1 800 717-1738
|
|
|
|
To join this conference
call, participants are required to provide the operator with the
name of the company hosting the call, that is, Cogeco Inc. or
Cogeco Communications Inc.
|
SOURCE Cogeco Inc.
