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Cogeco Cable Reports Q4 and Fiscal 2012 Financial Results
- Achieves increases of 8% of its revenue and operating income before depreciation and amortization(1) for fiscal 2012;

MONTREAL, QUEBEC -- (Marketwire) -- 11/02/12 -- Today, Cogeco Cable Inc. (TSX:CCA) ("Cogeco Cable" or the "Corporation") announced its financial results for the fourth quarter and fiscal year 2012, ended August 31, 2012, in accordance with International Financial Reporting Standards ("IFRS").

For the fourth quarter and fiscal 2012:


--  Revenue increased by 6.2% to reach $324.8 million, and by 7.9% to reach
    $1.278 billion; 

--  Operating income before depreciation and amortization increased by 6.1%
    to $160.8 million compared to the fourth quarter of fiscal 2011, and by
    8% to $589.1 million compared to the prior fiscal year; 

--  Operating margin(1) decreased in the quarter to 49.5% from 49.6% and
    increased in the year to 46.1% from 46% when compared to the same
    periods of the prior year; 

--  Profit for the period from continuing operations amounted to $45.7
    million in the fourth quarter when compared to $62.7 million for the
    same period of the previous fiscal year. For fiscal 2012, profit for the
    year from continuing operations amounted to $169.5 million when compared
    to $199.2 million for fiscal 2011. Profit declined for the fourth
    quarter and fiscal 2012 and is mostly attributable to the increase in
    depreciation and amortization expense due to the reduction of
    depreciation period for certain property plant and equipment combined
    with the increase in income taxes from the change in the corporate
    income tax rate recently announced by the Ontario government, partly
    offset by the increase in operating income before depreciation and
    amortization; 

--  Profit for the period amounted to $45.7 million in the fourth quarter
    when compared to $69 million for the same period of the previous fiscal
    year. The decrease is mostly attributable to an increase in income tax
    expense stemming primarily from the increase in income taxes from the
    change in the corporate income tax rate recently announced by the
    Ontario government and the increase of depreciation and amortization
    expense due to the reduction of the depreciation period of certain
    property, plant and equipment. For fiscal 2012, profit for the year
    amounted to $225 million when compared to a loss of $45.6 million for
    the prior year. The increase is mostly attributable to the write-off of
    the Corporation's net investment in the Portuguese subsidiary recorded
    through a non-cash impairment loss in the amount of $225.9 million
    during the third quarter of fiscal 2011, the improvement of operating
    income before depreciation and amortization and the gain on disposal of
    the Portuguese subsidiary in fiscal 2012, partly offset by the increase
    of depreciation and amortization expense due to the reduction of the
    depreciation period of certain property, plant and equipment; 

--  Free cash flow (1) reached $2.6 million for the quarter compared to $24
    million in the comparable quarter of the prior year. For fiscal 2012,
    free cash flow amounted to $66.3 million, compared to $114.8 million in
    fiscal 2011. Free cash flow decreased in both periods over the prior
    year due to an increase in acquisitions of property, plant and equipment
    and intangible and other assets combined with the increase in current
    income tax expense stemming primarily from the fiscal 2011 modifications
    to the corporate structure, partly offset by the increase in operating
    income before depreciation and amortization; 

--  Primary service units ("PSU")(2) grew by 6,959 in the quarter and 71,664
    in fiscal 2012, for a total of 1,969,133 PSU at August 31, 2012; 

--  A quarterly dividend of $0.25 per share was paid to the holders of
    subordinate and multiple voting shares, an increase of $0.05 per share,
    or 25%, when compared to a dividend of $0.20 per share paid in the
    fourth quarter of fiscal 2011. Dividend payments totalled $1 per share
    in fiscal 2012, compared to $0.71 per share in fiscal 2011, an increase
    of $0.29 per share, or 40.8%; 

--  On November 1, 2012, Cogeco Cable declared an eligible dividend of $0.26
    per share, an increase of 4% when compared to the $0.25 dividend per
    share paid in the fourth quarter of fiscal 2012; 

--  On July 18, 2012, the Corporation announced an agreement to acquire all
    of the shares of Atlantic Broadband ("Atlantic") an independent cable
    system operator formed in 2003 which, at August 31, 2012, was serving
    about 251,000 Television service customers providing Analogue and
    Digital Television, as well as High Speed Internet ("HSI") and Telephony
    services. Ranked the 13th-largest cable television system operator in
    the United States, Atlantic operates cable systems in Pennsylvania,
    Florida, Maryland, Delaware and South Carolina. The transaction is
    valued at US$1.36 billion and expected to be financed through a
    combination of cash on hand, a draw-down on its existing Term Revolving
    Facility of approximately US$550 million and US$660 million of
    borrowings under a new committed non-recourse debt financing at
    Atlantic. The transaction is subject to usual closing conditions,
    including Hart-Scott-Rodino Antitrust Improvements Act approval, Federal
    Communications Commission ("FCC") approval, state and local regulatory
    approvals and other customary conditions. The Corporation expects the
    transaction to close by the end of calendar 2012; and 

--  On February 29, 2012, the Corporation completed the sale of its
    Portuguese subsidiary, Cabovisao - Televisao por Cabo, S.A.
    ("Cabovisao") for a cash consideration of EUR45 million, or
    approximately $59.3 million. Operating results from European operations
    have therefore been classified as discontinued operations. 

(1) The indicated terms do not have standard definitions prescribed by IFRS and therefore, may not be comparable to similar measures presented by other companies. For more details, please consult the "Non-IFRS financial measures" section of the Results overview.

(2) Represents the sum of Television, High Speed Internet ("HSI") and Telephony service customers.

"Cogeco Cable's financial results for fiscal 2012 continue to reflect the vitality and growth for which your Corporation is known. Driven to attain our corporate goals, we are proud of having met the great majority of those we set for ourselves for this fiscal year 2012 as revised last July. In the residential services area, deployment of the DOCSIS 3.0 technology continued and 83% of our customers now enjoy very high speed Internet service, among the fastest in the territories we serve. In the commercial services area, Cogeco Cable continues to see strong growth among small and medium-sized enterprises.

Cogeco Data Services ("CDS"), our Enterprise services subsidiary, moved ahead successfully in integrating the operations of Toronto-based Quiettouch Inc. ("QTI") and Montreal-based MTO Telecom Inc. ("MTO"), both acquired in 2011. Today, this sector enables us to anticipate highly satisfactory organic growth of more than 10% annually over the coming years", declared Louis Audet, President and Chief Executive Officer of Cogeco Cable.

Mr.Audet added, "Fiscal 2013 will be a time of North American expansion as Cogeco Cable extends its operations south of the border as a result of the upcoming closing of the acquisition of Atlantic, an independent cable system operator serving about 251,000 television service customers and fully develops its great potential. This acquisition offers substantial growth opportunities for Cogeco Cable, including higher penetration among small and medium-sized enterprises, as well as the potential to optimize the packaging of services in the residential area. Following this transaction, Cogeco Cable will serve more than 1.1 million Television service customers in Canada and the United States."

Fiscal 2013 Financial Guidelines

Cogeco Cable's maintains its fiscal 2013 financial guidelines, as issued on July 11, 2012. Fiscal 2013 financial guidelines will be revised once the recently announced acquisition of Atlantic is concluded. Please consult the "Fiscal 2013 financial guidelines" section of the Corporation's 2012 Annual Report for further details.

FINANCIAL HIGHLIGHTS


----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
                      Quarters ended August 31,       Years ended August 31,
                         2012      2011 Change       2012      2011  Change 
(in thousands of                                                            
 dollars, except                                                            
 percentages, PSU                                                           
 growth and per                                                             
 share data)                $         $      %          $         $       % 
----------------------------------------------------------------------------
Operations                                                                  
Revenue               324,768   305,811    6.2  1,277,698 1,184,683     7.9 
Operating income                                                            
 before                                                                     
 depreciation and                                                           
 amortization(1)      160,825   151,579    6.1    589,052   545,361     8.0 
Operating margin(1)     49.5%     49.6%      -      46.1%     46.0%       - 
Operating income       94,709    97,941   (3.3)   312,180   341,079    (8.5)
Profit for the year                                                         
 from continuing                                                            
 operations            45,705    62,745  (27.2)   169,517   199,165   (14.9)
Profit (loss) for                                                           
 the year from                                                              
 discontinued                                                               
 operations                 -     6,219      -     55,446  (244,736)      - 
Profit (loss) for                                                           
 the year              45,705    68,964  (33.7)   224,963   (45,571)      - 
----------------------------------------------------------------------------
Cash Flow                                                                   
Cash flow from                                                              
 operating                                                                  
 activities           203,343   211,847   (4.0)   450,386   492,085    (8.5)
Cash flow from                                                              
 operations(1)        126,946   144,699  (12.3)   441,686   417,367     5.8 
Acquisitions of                                                             
 property, plant                                                            
 and equipment,                                                             
 intangible and                                                             
 other assets         124,392   120,663    3.1    375,368   302,541    24.1 
Free cash flow(1)       2,554    24,036  (89.4)    66,318   114,826   (42.2)
----------------------------------------------------------------------------
Financial Condition                                                         
Property, plant and                                                         
 equipment                  -         -      -  1,322,093 1,254,217     5.4 
Total assets                -         -      -  2,908,079 2,712,679     7.2 
Indebtedness(2)             -         -      -  1,069,112   981,214     9.0 
Shareholders'                                                               
 equity                     -         -      -  1,188,431 1,033,252    15.0 
----------------------------------------------------------------------------
PSU(3)growth            6,959    19,740  (64.7)    71,664   106,310   (32.6)
----------------------------------------------------------------------------
Per Share Data(4)                                                           
Earnings (loss) per                                                         
 share                                                                      
  From continuing                                                           
   and discontinued                                                         
   operations                                                               
    Basic                0.94      1.42  (33.8)      4.62     (0.94)      - 
    Diluted              0.93      1.42  (34.5)      4.60     (0.94)      - 
  From continuing                                                           
   operations                                                               
    Basic                0.94      1.29  (27.1)      3.48      4.10   (15.1)
    Diluted              0.93      1.29  (27.9)      3.46      4.10   (15.6)
  From discontinued                                                         
   operations                                                               
    Basic                   -      0.13      -       1.14     (5.04)      - 
    Diluted                 -      0.13      -       1.13     (5.04)      - 
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) The indicated terms do not have standardized definitions prescribed by  
    IFRS and therefore, may not be comparable to similar measures presented 
    by other companies. For more details, please consult the "Non-IFRS      
    financial measures" section of the Results overview.                    
(2) Indebtedness is defined as the total of principal on long-term debt,    
    balance due on a business acquisition and obligations under derivative  
    financial instruments.                                                  
(3) Represents the sum of Television, HSI and Telephony service customers.  
(4) Per multiple and subordinate voting share.                              

FORWARD-LOOKING STATEMENTS

Certain statements in this press release may constitute forward-looking information within the meaning of securities laws. Forward-looking information may relate to Cogeco Cable's 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. In particular, statements regarding the Corporation's future operating results and economic performance and its objectives and strategies are forward-looking statements. These statements are based on certain factors and assumptions including expected growth, results of operations, performance and business prospects and opportunities, which Cogeco Cable believes are reasonable as of the current date. While management considers these assumptions to be reasonable based on information currently available to the Corporation, they may prove to be incorrect. The Corporation cautions the reader that the economic downturn experienced over the past few years makes forward-looking information and the underlying assumptions subject to greater uncertainty and that, consequently, they may not materialize, or the results may significantly differ from the Corporation's expectations. It is impossible for Cogeco Cable to predict with certainty the impact that the current economic uncertainties may have on future results. Forward-looking information is also subject to certain factors, including risks and uncertainties (described in the "Uncertainties and main risk factors" section of the Corporation's 2012 annual Management's Discussion and Analysis ("MD&A")) that could cause actual results to differ materially from what Cogeco Cable currently expects. These factors include technological changes, changes in market and competition, governmental or regulatory developments, general economic conditions, the development of new products and services, the enhancement of existing products and services, and the introduction of competing products having technological or other advantages, many of which are beyond the Corporation's control. Therefore, future events and results may vary significantly from what management currently foresee. The reader should not place undue importance on forward-looking information and should not rely upon this information as of any other date. While management may elect to, the Corporation is under no obligation (and expressly disclaims any such obligation), and does not undertake to update or alter this information before the next quarter.

As described in note 1 to the consolidated financial statements of the 2012 Annual Report, Canadian Generally Accepted Accounting Principles ("GAAP"), which were previously used in preparing the consolidated financial statements, were replaced on the adoption of International Financial Reporting Standards ("IFRS") on January 1, 2011. The Corporation's consolidated financial statements for the year ended August 31, 2012 have therefore been prepared in accordance with IFRS. Comparative figures for 2011 have also been restated.

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 2012 Annual Report, the Corporation's consolidated financial statements and the notes thereto as well as the information on the adjustments to the fiscal 2011 financial figures upon adoption of IFRS, explained in Note 26 of the consolidated financial statements for year ended August 31, 2012.

RESULTS OVERVIEW

This analysis should be read in conjunction with the Corporation's 2012 Annual Report available on SEDAR at www.sedar.com. Please refer to the Corporation's 2012 Annual Report for more details on annual results.

Operating results

Quarter ended august 31, 2012


------------------------------------------------------------------------
------------------------------------------------------------------------
                                                                        
                                Cable services       Enterprise services
------------------------------------------------------------------------
Quarters ended                                                          
 August 31,             2012     2011   Change    2012     2011   Change
(in thousands of                                                        
 dollars, except                                                        
 percentages)              $        $        %       $        $        %
------------------------------------------------------------------------
Revenue              301,992  286,457      5.4  23,133   19,354     19.5
Operating expenses   148,725  139,948      6.3  11,876   11,509      3.2
------------------------------------------------------------------------
Operating income                                                        
 before depreciation                                                    
 and amortization    153,267  146,509      4.6  11,257    7,845     43.5
Operating margin        50.8%    51.1%            48.7%    40.5%        
                                                                        
------------------------------------------------------------------------
------------------------------------------------------------------------

----------------------------------------------------------------
----------------------------------------------------------------
                                                                
                         Inter-segment                          
                      eliminations and                          
                              other(1)              Consolidated
----------------------------------------------------------------
Quarters ended                                                  
 August 31,             2012     2011     2012     2011   Change
(in thousands of                                                
 dollars, except                                                
 percentages)              $        $        $        $        %
----------------------------------------------------------------
Revenue                 (357)       -  324,768  305,811      6.2
Operating expenses     3,342    2,775  163,943  154,232      6.3
----------------------------------------------------------------
Operating income                                                
 before depreciation                                            
 and amortization     (3,699)  (2,775) 160,825  151,579      6.1
Operating margin           -        -     49.5%    49.6%        
                                                                
----------------------------------------------------------------
----------------------------------------------------------------
(1) The inter-segment eliminations and other eliminate any intercompany     
    transactions included in each segment's results and include head office 
    activities.                                                             

Fiscal 2012 fourth-quarter consolidated revenue improved by $19 million, or 6.2%, to reach $324.8 million, when compared to the prior year. For the fourth-quarter ended August 31, 2012, consolidated operating expenses increased by $9.7 million, or 6.3%, at $163.9 million. As a result, consolidated operating income before depreciation and amortization increased by $9.2 million, or 6.1%, to reach $160.8 million and consolidated operating margin slightly decreased to 49.5% compared to 49.6% in the fourth quarter of fiscal 2011.

Cable services

Customer statistics


----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
                                                     Net additions (losses) 
                                                  Quarters ended August 31, 
                                                      2012             2011 
----------------------------------------------------------------------------
PSU                                                  6,959           19,740 
Television service customers(1)                     (5,758)          (1,369)
HSI service customers                                5,682            7,746 
Telephony service customers                          7,035           13,363 
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) The net losses of Television service customers includes net additions of
    5,918 Digital Television service customers.                             

Fiscal 2012 fourth-quarter PSU net additions were lower than in the comparable period of the prior year mainly as a result of category maturity, competitive offers and tightening of our credit controls and processes. Fourth quarter net customer losses for Television service customers stood at 5,758 when compared to 1,369 for the same period of the prior year due to the end of the school year for college and university students as well as the intense competition driving the telecommunications industry. Telephony service customers grew by 7,035 compared to 13,363 for the same period last year, and the number of net additions to the HSI service stood at 5,682 compared to 7,746 customers for the same period of the prior year. HSI and Telephony net additions continue to stem from the enhancement of the product offering, the impact of the bundled offer (Cogeco Complete Connection) of Television, HSI and Telephony services, and promotional activities. Additions to the Digital Television service which are included in the Television service customers, stood at 5,918 compared to 29,464 for the comparable period of the prior year. Digital Television service net additions are due to the deployment of Digital Terminal Adapters technology to migrate customers from analogue to digital services, the targeted marketing initiatives to improve penetration, the launch of new HD channels and the continuing interest for HD television service.

Operating results

Driven by PSU growth combined with rate increases in June and July 2012, fourth-quarter revenue went up by $15.5 million, or 5.4%, to reach $302 million.

Fiscal 2012 fourth-quarter operating expenses increased by $8.8 million, or 6.3%, at $148.7 million mainly attributable to the PSU growth, the launch of new HD channels, additional programming costs and deployment and support costs related to the migration of Television service customers from analogue to digital.

The operating income before depreciation and amortization increased by $6.8 million, or 4.6%, and the operating margin decreased to 50.8% from 51.1%.

Enterprise services

Operating results

Fiscal 2012 fourth-quarter revenue increased by $3.8 million, or 19.5%, at $23.1 million mainly as a result of the acquisitions of QTI and MTO during the fourth quarter of fiscal 2011 combined with an increase of 8.8% related to organic growth, partly offset by non-recurring revenue in fiscal 2011 related to a one-time project development.

Fiscal 2012 fourth-quarter operating expenses increased by $0.4 million, or 3.2%, at $11.9 million mainly attributable to the acquisition of QTI and MTO and to servicing new customers, partly offset by additional expenses in fiscal 2011 related to a one-time project development.

The operating income before depreciation and amortization increased by 43.5% of which 27.7% comes from organic growth. The operating margin increased to 48.7% from 40.5%, mainly attributable to additional expenses in fiscal 2011 related to a one time project development as well as the acquisitions of QTI and MTO.

Cash flow analysis


----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Quarters ended August 31,                                 2012         2011 
(in thousands of dollars)                                    $            $ 
----------------------------------------------------------------------------
Operating activities                                                        
Cash flow from operations                              126,946      144,699 
Changes in non-cash operating activities                75,065       70,760 
Amortization of deferred transaction costs and                              
 discounts on long-term debt                              (747)        (659)
Income taxes paid                                      (15,090)         (91)
Current income tax expense (recovery)                   15,476       (7,509)
Financial expense paid                                 (14,324)      (9,836)
Financial expense                                       16,017       14,483 
----------------------------------------------------------------------------
                                                       203,343      211,847 
Investing activities                                  (124,480)    (251,695)
Financing activities                                   (12,803)         755 
----------------------------------------------------------------------------
Net change in cash and cash equivalents from                                
 continuing operations                                  66,060      (39,093)
Net change in cash and cash equivalents from                                
 discontinued operations(1)                                  -       (1,551)
Cash and cash equivalents from continuing and                               
 discontinued operations, beginning of period          149,331       96,091 
----------------------------------------------------------------------------
Cash and cash equivalents from continuing and                               
 discontinued operations, end of period                215,391       55,447 
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) For further details on the Corporation's cash flows attributable to     
    discontinued operations, please refer to the "Disposal of subsidiary and
    discontinued operations" section.                                       

During the fourth quarter of 2012, cash flow from operations reached $126.9 million, 12.3% lower than the comparable period last year, primarily due to the increase in current income tax expense, partly offset by the increase in operating income before depreciation and amortization. Changes in non-cash operating items generated cash inflows of $75.1 million compared to $70.8 million for the same period in fiscal 2011, mainly as a result of a higher increase in trade and other payables, partly offset by a decrease in provision compared to an increase in prior year and an increase in trade and other receivables compared to a decrease in prior year.

Fiscal 2012 fourth-quarter investing activities amounted to $124.5 million, a decrease of 50.5% when compared to $251.7 million in the fourth quarter of the prior year. The decrease is primarily due to the acquisitions of QTI and MTO for a total of $131.2 million, included in fiscal 2011 fourth-quarter. Except for the business combinations, investing activities are mainly composed of acquisitions of property, plant and equipment, intangible and other assets. Acquisition of intangible and other assets are mainly attributable to reconnect and additional service activation costs as well as other customer acquisition costs. For fiscal 2012 fourth-quarter, the acquisition of property, plant and equipment amounted to $119.2 million and acquisitions of intangible and other assets amounted to $5.2 million compared to $118.3 million and $2.3 million, respectively, for the same period of prior year.

In the fourth quarter of 2012, the Corporation generated free cash flows of $2.6 million compared to $24 million in the prior year. The decrease in free cash flow over the prior year is due to the difference in the recognition of current income tax expense compared to income tax recovery in prior year, partly offset by the increase of operating income before depreciation and amortization.

In the fourth quarter of 2012, Indebtedness affecting cash remained essentially the same. In the fourth quarter of 2011, Indebtedness affecting cash decreased by $10.6 million mainly through net repayments on the Corporation's Term Revolving Facility of $11.2 million.

During the fourth quarter of fiscal 2012, a dividend of $0.25 per share was paid to the holders of subordinate and multiple voting shares, totalling $12.2 million, 25% higher than the dividend of $0.20 per share, or $9.7 million the year before.

Year ended august 31, 2012


----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
                                 Cable services          Enterprise services
Years ended August                                                          
 31,                   2012      2011    Change     2012      2011    Change
(in thousands of                                                            
 dollars, except                                                            
 percentages)             $         $         %        $         $         %
----------------------------------------------------------------------------
Revenue           1,188,717 1,123,652       5.8   89,831    61,031      47.2
Operating expenses  614,644   581,489       5.7   51,649    35,754      44.5
Management fees -                                                           
 COGECO Inc.              -         -         -        -         -         -
----------------------------------------------------------------------------
Operating income                                                            
 before                                                                     
 depreciation and                                                           
 amortization       574,073   542,163       5.9   38,182    25,277      51.1
Operating margin       48.3%     48.3%              42.5%     41.4%         
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------

----------------------------------------------------------
----------------------------------------------------------
                                                          
                         Inter-segment                    
                      eliminations and                    
                              other(1)        Consolidated
Years ended August                                        
 31,                   2012      2011      2012      2011 
(in thousands of                                          
 dollars, except                                          
 percentages)             $         $         $         $ 
----------------------------------------------------------
Revenue                (850)        - 1,277,698 1,184,683 
Operating expenses   12,868    12,907   679,161   630,150 
Management fees -                                         
 COGECO Inc.          9,485     9,172     9,485     9,172 
----------------------------------------------------------
Operating income                                          
 before                                                   
 depreciation and                                         
 amortization       (23,203)  (22,079)  589,052   545,361 
Operating margin          -         -      46.1%     46.0%
                                                          
----------------------------------------------------------
----------------------------------------------------------
(1) The inter-segment eliminations and other eliminate any intercompany     
    transactions included in each segment's results and include head office 
    activities.                                                             

Cable services

Customer statistics


----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
                                Net additions (losses)   % of penetration(1)
                    August 31,  Years ended August 31,            August 31,
                          2012        2012        2011      2012        2011
----------------------------------------------------------------------------
PSU                  1,969,133      71,664     106,310                      
Television service                                                          
 customers(2)          863,115     (14,870)      3,480      52.4        54.1
HSI service                                                                 
 customers             634,534      33,320      42,157      38.5        37.1
Telephony service                                                           
 customers             471,484      53,214      60,673      28.6        25.8
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) As a percentage of homes passed.                                        
(2) The number of Television service customers includes 771,503 Digital     
     Television service customers.                                          

During fiscal 2012, PSU net additions were lower than in the comparable period of the prior year mainly as a result of category maturity, competitive offers and tightening of our credit controls and processes. For the year ended August 31, 2012, net customer losses for Television service customers stood at 14,870 compared to 3,480 net additions for the prior year. Television service customer net losses are mainly due to the competitive promotional offers for the video service combined with the tightening of our credit controls. For the year ended August 31, 2012, Telephony service customers grew by 53,214 compared to 60,673 last year, and the number of net additions to the HSI service stood at 33,320 customers compared to 42,157 customers for the prior year. HSI and Telephony net additions continue to stem from the enhancement of the product offering, the impact of the bundled offer (Cogeco Complete Connection) of Television, HSI and Telephony services, and promotional activities. For the year ended August 31, 2012, additions to the Digital Television service which are included in the Television service customers, stood at 93,177 compared to 118,908 for the comparable period of the prior year. Digital Television service net additions are due to the deployment of Digital Terminal Adapters technology to migrate customers from analogue to digital services, the targeted marketing initiatives to improve penetration, the launch of new HD channels and the continuing interest for HD television service.

Operating results

Revenue

For the 2012 fiscal year, revenue increased by $65.1 million, or 5.8%, to reach $1.189 billion, when compared to the same period last year, primarily due to the PSU growth and rate increases implemented in April and October 2011 and in June and July 2012.

Operating expenses

For the year ended August 31, 2012, operating expenses increased by $33.2 million, or 5.7%, at $614.6 million The increase in operating expenses is mainly attributable to servicing additional PSU, the launch of new HD channels, additional programming costs and the deployment and support costs related to the migration of Television service customers from analogue to digital.

Operating income before depreciation and amortization and operating margin

As a result of revenue growth slightly exceeding the increase in operating expenses, fiscal 2012 operating income before depreciation and amortization amounted to $574.1 million, or 5.9%, higher than in the prior year, and operating margin was the same at 48.3%.

Enterprise services

Operating results

Revenue

For the 2012 fiscal year, revenue increased by $28.8 million, or 47.2%, to reach $89.8 million, when compared to the same period last year, primarily due to the acquisitions of QTI and MTO during the fourth quarter fiscal 2011 combined with an increase of 7.9% related to organic growth.

Operating expenses

For the year ended August 31, 2012, operating expenses increased by $15.9 million, or 44.5%, to $51.6 million. The increase in operating expenses is mainly attributable to the acquisitions of QTI and MTO and to servicing new customers .

Operating income before depreciation and amortization and operating margin

As a result of revenue growth exceeding the increase in operating expenses, fiscal 2012 operating income before depreciation and amortization amounted to $38.2 million, or 51.1%, higher than in the prior year of which 12.6% comes from organic growth. Operating margin increased to 42.5% from 41.4% when compared to fiscal 2011.

Disposal of subsidiary and discontinued operations

On February 29, 2012, the Corporation completed the sale of its Portuguese subsidiary, Cabovisao for a cash consideration of EUR45 million ($59.3 million). The selling price has been reduced by selling fees of approximately EUR8.5 million ($11.2 million) and contingent claims assumed up to a maximum amount of EUR5 million ($6.6 million). The carrying value of the net liabilities disposed of on February 29, 2012 was $6.7 million resulting in a gain of $48.2 million recorded in the consolidated statements of profit or loss.

The carrying value of assets and liabilities disposed were as follows:


----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
(In thousands of dollars)                                                 $ 
----------------------------------------------------------------------------
Cash and cash equivalents                                            13,041 
Trade and other receivables                                           7,693 
Income taxes receivable                                                 277 
Prepaid expenses and other                                            2,777 
Property, plant and equipment                                        38,931 
Trade and other payables                                            (42,514)
Provisions                                                           (6,665)
Deferred and prepaid revenue                                           (411)
Foreign currency translation adjustment                             (19,817)
----------------------------------------------------------------------------
                                                                     (6,688)
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------

As a result of the sale and in accordance with IFRS 5 - Non-Current Assets Held for Sale and Discontinued Operations, the Corporation reclassified the current and prior year results and cash flows of the European operations, up to the date of disposal, as discontinued operations. The assets and liabilities of the discontinued operations have not been reclassified in the statements of financial position at August 31, 2011 and September 1, 2010.

The profit or loss of the discontinued operations were as follows:


----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
                       Quarters ended August 31,     Years ended August, 31 
                               2012         2011         2012          2011 
(In thousands of                                                            
 dollars)                         $            $            $             $ 
----------------------------------------------------------------------------
Revenue                           -       43,306       80,546       172,277 
Operating expenses                -       36,718       70,247       151,262 
Depreciation and                                                            
 amortization                     -          347        2,814        40,415 
----------------------------------------------------------------------------
Operating income                                                            
 (loss)                           -        6,241        7,485       (19,400)
Financial expense                                                           
 (income)                         -           11         (155)          (74)
Impairment of goodwill            -            -            -        29,344 
Impairment of                                                               
 property, plant and                                                        
 equipment                        -            -            -       196,529 
Gain on disposal                  -            -       48,215             - 
----------------------------------------------------------------------------
Profit (loss) before                                                        
 income taxes                     -        6,230       55,855      (245,199)
Income taxes                      -           11          409          (463)
----------------------------------------------------------------------------
Profit (loss) for the                                                       
 period                           -        6,219       55,446      (244,736)
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------

The cash flows of the discontinued operations were as follows:


----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
                      Quarters ended August 31,      Years ended August, 31 
                              2012         2011          2012          2011 
(In thousands of                                                            
 dollars)                        $            $             $             $ 
----------------------------------------------------------------------------
Net cash flows from                                                         
 operating activities            -        6,818        13,637        22,667 
Net cash flows from                                                         
 investing activities            -       (8,519)       36,826       (34,592)
Effect of exchange                                                          
 rate changes on cash                                                       
 and cash equivalents                                                       
 denominated in a                                                           
 foreign currency                -          150          (866)          588 
----------------------------------------------------------------------------
Net increase                                                                
 (decrease) in cash                                                         
 and cash equivalents            -       (1,551)       49,597       (11,337)
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Non-IFRS financial measures

This section describes non-IFRS financial measures used by Cogeco Cable throughout this press release. It also provides reconciliations between these non-IFRS measures and the most comparable IFRS financial measures. These financial measures do not have standard definitions prescribed by IFRS and therefore, may not be comparable to similar measures presented by other companies. These measures include "cash flow from operations", "free cash flow", "operating income before depreciation and amortization" and "operating margin".

Cash flow from operations and free cash flow

Cash flow from operations is used by Cogeco Cable's management and investors to evaluate cash flows generated by operating activities, excluding the impact of changes in non-cash operating activities, amortization of deferred transaction costs and discounts on long-term debt, income taxes paid or received, current income tax expense or recovery, financial expense paid and financial expense. This allows the Corporation to isolate the cash flows from operating activities from the impact of cash management decisions. Cash flow from operations is subsequently used in calculating the non-IFRS measure, "free cash flow". Free cash flow is used, by Cogeco Cable's management and investors, to measure its ability to repay debt, distribute capital to its shareholders and finance its growth.

The most comparable IFRS measure is cash flow from operating activities. Cash flow from operations is calculated as follows:


----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
                        Quarters ended August 31,    Years ended August 31, 
                                2012         2011         2012         2011 
(in thousands of                                                            
 dollars)                          $            $            $            $ 
----------------------------------------------------------------------------
Cash flow from operating                                                    
 activities                  203,343      211,847      450,386      492,085 
Changes in non-cash                                                         
 operating activities        (75,065)     (70,760)      (3,493)     (10,409)
Amortization of deferred                                                    
 transaction costs and                                                      
 discounts on long-term                                                     
 debt                            747          659        2,817        2,913 
Income taxes paid                                                           
 (received)                   15,090           91       79,728       (3,067)
Current income tax                                                          
 recovery (expense)          (15,476)       7,509      (85,216)     (62,495)
Financial expense paid        14,324        9,836       61,471       69,502 
Financial expense            (16,017)     (14,483)     (64,007)     (71,162)
----------------------------------------------------------------------------
Cash flow from                                                              
 operations                  126,946      144,699      441,686      417,367 
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Free cash flow is calculated as follows:


----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
                        Quarters ended August 31,    Years ended August 31, 
                                2012         2011         2012         2011 
(in thousands of                                                            
 dollars)                          $            $            $            $ 
----------------------------------------------------------------------------
Cash flow from                                                              
 operations                  126,946      144,699      441,686      417,367 
Acquisition of property,                                                    
 plant and equipment        (119,175)    (118,326)    (359,581)    (291,669)
Acquisition of                                                              
 intangible and other                                                       
 assets                       (5,217)      (2,337)     (15,787)     (10,872)
----------------------------------------------------------------------------
Free cash flow                 2,554       24,036       66,318      114,826 
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Operating income before depreciation and amortization and operating margin

Operating income before depreciation and amortization is used by Cogeco Cable's management and investors to assess the Corporation's ability to seize growth opportunities in a cost effective manner, to finance its ongoing operations and to service its debt. Operating income before depreciation and amortization is a proxy for cash flows from operations excluding the impact of the capital structure chosen, and is one of the key metrics used by the financial community to value the business and its financial strength. Operating margin is a measure of the proportion of the Corporation's revenue which is available, before income taxes, to pay for its fixed costs, such as interest on Indebtedness. Operating margin is calculated by dividing operating income before depreciation and amortization by revenue.

The most comparable IFRS financial measure is operating income. Operating income before depreciation and amortization and operating margin are calculated as follows:


----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
                        Quarters ended August 31,    Years ended August 31, 
                                2012         2011         2012         2011 
(in thousands of                                                            
 dollars, except                                                            
 percentages)                      $            $            $            $ 
----------------------------------------------------------------------------
Operating income              94,709       97,941      312,180      341,079 
Depreciation and                                                            
 amortization                 64,247       51,314      275,003      201,958 
Integration,                                                                
 restructuring and                                                          
 acquisitions costs            1,869        2,324        1,869        2,324 
----------------------------------------------------------------------------
Operating income before                                                     
 depreciation and                                                           
 amortization                160,825      151,579      589,052      545,361 
----------------------------------------------------------------------------
Revenue                      324,768      305,811    1,277,698    1,184,683 
----------------------------------------------------------------------------
Operating margin                49.5%        49.6%        46.1%        46.0%
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Supplementary quartely financial information


-------------------------------------------------------------------------
-------------------------------------------------------------------------
                                                                         
                                                              Fiscal 2012
Quarters ended(1)                Nov. 30    Feb. 29     May 31    Aug. 31
(in thousands of dollars,                                                
 except percentages and per                                              
 share data)                           $          $          $          $
-------------------------------------------------------------------------
Revenue                          315,424    317,735    319,771    324,768
Operating income before                                                  
 depreciation and                                                        
 amortization                    131,823    143,743    152,661    160,825
Operating margin                   41.8%      45.2%      47.7%      49.5%
Operating income                  66,999     59,491     90,981     94,709
Income taxes                      10,603     13,617     21,449     32,987
Profit for the period from                                               
 continuing operations            39,567     31,086     53,159     45,705
Profit (loss) for the period                                             
 from discontinued operations      3,399     52,047          -          -
Profit (loss) for the period      42,966     83,133     53,159     45,705
Cash flow from operating                                                 
 activities                       13,807    120,961    112,275    203,343
Cash flow from operations         97,043    104,622    113,075    126,946
Acquisitions of property,                                                
 plant and equipment,                                                    
 intangible and other assets      77,283     86,234     87,459    124,392
Free cash flow                    19,760     18,388     25,616      2,554
Earnings (loss) per share(2)                                             
  From continuing and                                                    
   discontinued operations                                               
    Basic                           0.88       1.71       1.09       0.94
    Diluted                         0.88       1.70       1.09       0.93
  From continuing operations                                             
    Basic                           0.81       0.64       1.09       0.94
    Diluted                         0.81       0.63       1.09       0.93
  From discontinued                                                      
   operations                                                            
    Basic                           0.07       1.07          -          -
    Diluted                         0.07       1.06          -          -
                                                                         
-------------------------------------------------------------------------
-------------------------------------------------------------------------

----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
                                                                 Fiscal 2011
Quarters ended(1)                Nov. 30     Feb. 28      May 31     Aug. 31
(in thousands of dollars,                                                   
 except percentages and per                                                 
 share data)                           $           $           $           $
----------------------------------------------------------------------------
Revenue                          287,204     293,457     298,211     305,811
Operating income before                                                     
 depreciation and                                                           
 amortization                    125,236     130,399     138,147     151,579
Operating margin                   43.6%       44.4%       46.3%       49.6%
Operating income                  75,717      80,426      86,995      97,941
Income taxes                      16,285      15,007      18,747      20,713
Profit for the period from                                                  
 continuing operations            42,749      41,319      52,352      62,745
Profit (loss) for the period                                                
 from discontinued operations     (8,159)     (9,223)   (233,573)      6,219
Profit (loss) for the period      34,590      32,096    (181,221)     68,964
Cash flow from operating                                                    
 activities                       49,809      88,420     142,009     211,847
Cash flow from operations         32,063     114,682     125,923     144,699
Acquisitions of property,                                                   
 plant and equipment,                                                       
 intangible and other assets      58,017      61,079      62,782     120,663
Free cash flow                   (25,954)     53,603      63,141      24,036
Earnings (loss) per share(2)                                                
  From continuing and                                                       
   discontinued operations                                                  
    Basic                           0.71        0.66       (3.73)       1.42
    Diluted                         0.71        0.66       (3.73)       1.42
  From continuing operations                                                
    Basic                           0.88        0.85        1.08        1.29
    Diluted                         0.88        0.85        1.08        1.29
  From discontinued                                                         
   operations                                                               
    Basic                          (0.17)     (0.19)       (4.80)       0.13
    Diluted                        (0.17)     (0.19)       (4.80)       0.13
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) The addition of quarterly information may not correspond to the annual  
    total due to rounding.                                                  
(2) Per multiple and subordinate voting share.                              

Seasonal variations

Cogeco Cable's operating results are not generally subject to material seasonal fluctuations except as follows. The customer growth in the Television service customers and HSI service are generally lower in the second half of the fiscal year as a result of a decrease in economic activity due to the beginning of the vacation period, the end of the television seasons, and students leaving their campuses at the end of the school year. Cogeco Cable offers its services in several university and college towns such as Kingston, Windsor, St.Catharines, Hamilton, Peterborough, Trois-Rivieres and Rimouski in Canada. Furthermore, the third and fourth quarter's operating margin is usually higher as no management fees are paid to COGECO Inc. Under the Management Agreement, Cogeco Cable pays a fee equal to 2% of its total revenue subject to a maximum amount. As the maximum amount has been reached in the second quarters of fiscal 2012 and fiscal 2011, Cogeco Cable did not pay management fees in the second halves of either year.

Additional information

Additional information relating to the Corporation, including its 2012 Annual Report and Annual Information Form, is available on SEDAR at www.sedar.com.

About Cogeco Cable

Cogeco Cable (www.cogeco.ca) is a telecommunications corporation and is the second largest hybrid fibre coaxial cable operator in Ontario, and Quebec. Through its two-way broadband cable networks, Cogeco Cable provides its residential customers with Analogue and Digital Television, HSI and Telephony services. Cogeco Cable also provides to its commercial customers, through its subsidiary Cogeco Data Services, data networking, e-business applications, video conferencing, hosting services, Ethernet, private line, VoIP, HSI access, data storage, data security, co-location services, managed IT services, cloud services and other advanced communication solutions. Cogeco Cable's subordinate voting shares are listed on the Toronto Stock Exchange (TSX:CCA).


Analyst Conference Call: Friday, November 2, 2012 at 11:00 a.m. (Eastern    
                         Daylight Time)                                     
                         Media representatives may attend as listeners only.
                                                                            
                         Please use the following dial-in number to have    
                         access to the conference call by dialling five     
                         minutes before the start of the conference:        
                                                                            
                         Canada/USA Access Number: 1-800-820-0231           
                         International Access Number: 1-416-640-5926        
                         Confirmation Code: 7187134                         
                         By Internet at www.cogeco.ca/investors             
                                                                            
                         A rebroadcast of the conference call will be       
                         available until November 10, by dialling:          
                         Canada and US access number: 1 888-203-1112        
                         International access number: + 1 647-436-0148      
                         Confirmation code: 7187134                         

Customer statistics


----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                 2012       2011       2010 
----------------------------------------------------------------------------
                                                                            
Primary service units(1)                    1,969,133  1,897,469  1,791,159 
----------------------------------------------------------------------------
                                                                            
Television service customers                  863,115    877,985    874,505 
Penetration as a percentage of homes passed      52.4%      54.1%      54.9%
----------------------------------------------------------------------------
                                                                            
Digital Television service customers          771,503    678,326    559,418 
Penetration as a percentage of homes passed      46.8%      41.8%      35.1%
----------------------------------------------------------------------------
                                                                            
Analogue Television service customers          91,612    199,659    315,087 
Penetration as a percentage of homes passed       5.6%      12.3%      19.8%
----------------------------------------------------------------------------
                                                                            
High Speed Internet service customers         634,534    601,214    559,057 
Penetration as a percentage of homes passed      38.5%      37.1%      35.1%
----------------------------------------------------------------------------
                                                                            
Telephony service customers                   471,484    418,270    357,597 
Penetration as a percentage of homes passed      28.6%      25.8%      22.4%
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) Represents the sum of Television, High Speed Internet ("HSI") and       
    Telephony service customers.                                            

Contacts:
Source:
Cogeco Cable Inc.
Pierre Gagne
Senior Vice President and Chief Financial Officer
514-764-4700

Information:
Media
Rene Guimond
Vice-President, Public Affairs and Communications
514-764-4700

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