Cogeco Communications Releases its Financial Results for the Fourth Quarter of Fiscal 2022

  • Revenue increased by 14.7% (12.7% in constant currency (1)) compared to the same period of the prior year to reach $725.4 million;
  • Adjusted EBITDA (1) reached $347.1 million, an increase of 19.4% (17.7% in constant currency (1));
  • Profit for the period amounted to $111.8 million, an increase of 8.1%;
  • Earnings per share on a diluted basis was $2.28, an increase of 12.3%;
  • Net capital expenditures (1) (2) and capital intensity (1) were $223.5 million and 30.8%, respectively (or $161.9 million and 22.3% excluding network expansion projects (1), respectively), compared to $175.2 million and 27.7%, respectively, in the same period of the prior year;
  • Acquisition of property, plant and equipment amounted to $243.6 million, an increase of 35.6%;
  • Free cash flow (1) amounted to $34.5 million, a decrease of 51.8% (49.2% in constant currency (1)), following accelerated network expansion activities. Free cash flow, excluding network expansion projects (1) was $96.1 million;
  • Cash flows from operating activities increased by 13.4% to reach $319.1 million;
  • Purchased and cancelled 390,800 Cogeco Communications subordinate voting shares for a total consideration of $34.5 million; and
  • A quarterly eligible dividend of $0.776 per share was declared, compared to $0.705 per share last year, an increase of 10%.
  • For fiscal 2022, free cash flow dividend payout ratio (1) was 31% (or 22% excluding excluding network expansion projects (1))

MONTRÉAL, Oct. 27, 2022 /CNW Telbec/ – Today, Cogeco Communications Inc. (TSX: CCA) (“Cogeco Communications” or the “Corporation”) announced its financial results for the fourth quarter ended August 31, 2022, in accordance with International Financial Reporting Standards (“IFRS”).

OPERATING RESULTS

For the fourth quarter of fiscal 2022:

  • Revenue increased by 14.7% to reach $725.4 million. On a constant currency basis, revenue increased by 12.7%, mainly explained as follows:



    • American telecommunications’ revenue increased by 32.2% (27.6% in constant currency), mainly resulting from the Ohio broadband systems acquisition completed on September 1, 2021 and organic revenue growth driven by a higher value product mix.
      • Internet service customers as at August 31, 2022 compared to the same date of the prior year increased by 36% (3) in the U.S., reflecting the Ohio broadband systems acquisition completed on September 1, 2021 and 2% organic growth (3)



    • Canadian telecommunications’ revenue increased by 1.1% as reported and in constant currency, mostly as a result of organic revenue growth.
      • Internet service customers (4) as at August 31, 2022 compared to the same date of the prior year increased by 2% in Canada due to organic growth



  • Adjusted EBITDA increased by 19.4% to reach $347.1 million. On a constant currency basis, adjusted EBITDA increased by 17.7%, mainly explained as follows:



    • American telecommunications adjusted EBITDA increased by 35.4% (30.7% in constant currency), mainly resulting from the Ohio broadband systems acquisition, a higher margin driven by the organic revenue growth, partly offset by higher marketing and advertising costs to drive and support customer growth. Organic adjusted EBITDA growth in constant currency (1) was 11.6%.



    • Canadian telecommunications adjusted EBITDA increased by 6.4% (6.7% in constant currency), mainly resulting from lower marketing expenses and certain year-end adjustments.



  • Profit for the period amounted to $111.8 million, of which $104.9 million, or $2.28 per diluted share, was attributable to owners of the Corporation compared to $103.4 million, $96.2 million, and $2.03 per diluted share, respectively, in the comparable period of fiscal 2021. The increases resulted mainly from higher adjusted EBITDA and lower income tax expense, partly offset by the increases in financial expense, depreciation and amortization expense, and acquisition, integration, restructuring and other costs.



  • Net capital expenditures and capital intensity were $223.5 million and 30.8%, respectively, compared to $175.2 million and 27.7% in the same period of the prior year, following accelerated network expansion activities in the U.S. and Canada. Excluding network expansion projects, net capital expenditures and capital intensity amounted to $161.9 million and 22.3%, respectively.



    • Network expansion projects added 70,000 homes passed during the year representing an increase of approximately 4% (3) in the U.S. and 2% (3) in Canada. Those fibre-to-the-home network expansion are setting the Corporation for further growth in subscribers and profitability in years to come.



  • Acquisition of property, plant and equipment increased by 35.6% to $243.6 million, mainly due to network expansion projects in both countries.



  • Free cash flow decreased by 51.8% (49.2% in constant currency) and amounted to $34.5 million, mainly due to higher net capital expenditures driven by increased activity related to network expansions in both countries, and the increases in financial expense, acquisition, integration, restructuring and other costs, and current income taxes, partly offset by higher adjusted EBITDA. Free cash flow, excluding network expansion projects was $96.1 million;



  • Cash flows from operating activities increased by 13.4% to reach $319.1 million, mainly resulting from higher adjusted EBITDA and lower income taxes paid, partly offset by higher trade and other payables, and the increases in acquisition, integration, restructuring and other costs, and interest paid.



  • Cogeco Communications purchased and cancelled 390,800 subordinate voting shares for a total consideration of $34.5 million.



  • Cogeco Communications maintains its fiscal 2023 financial guidelines as issued on July 13, 2022.



  • At its October 27, 2022 meeting, the Board of Directors of Cogeco Communications declared a quarterly eligible dividend of $0.776 per share, an increase of 10% compared to $0.705 per share last year.

(1)

Adjusted EBITDA and net capital expenditures are total of segments measures. Capital intensity is a supplementary financial measure. Net capital expenditures, excluding network expansion projects, free cash flow and free cash flow, excluding network expansion projects, are non-IFRS financial measures. Constant currency basis, organic adjusted EBITDA growth in constant currency, capital intensity, excluding network expansion projects, free cash flow dividend payout ratio and free cash flow, excluding network expansion projects, dividend payout ratio are non-IFRS ratios. These 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 information on these financial measures, please consult the “Non-IFRS and other financial measures” section of this press release.

(2)

Net capital expenditures are presented net of government subsidies, including the utilization of those received in advance.

(3)

Calculated as a percentage of growth compared to August 31, 2021. Organic growth is calculated by excluding additions resulting from acquisitions. Homes passed at acquisition date have been adjusted upwards by approximately 19,000 following the migration of the customer management and billing systems in Ohio in late May 2022. This change has been applied retrospectively to the comparative figures.

(4)

During the fourth quarter of fiscal 2022, the Corporation modified its definition of Internet service customers in order to be consistent with industry practices. As per the new definition, Internet service customers include only customers who have their Internet service installed, operated and billed directly by the Corporation. The previous definition also included wholesale Internet customers, which is applicable only in Canada. This change has been applied retrospectively to the comparative figures.

“We are pleased with Cogeco Communications’ overall performance which is in line with our financial projections for fiscal 2022, despite the current challenging economic environment,” said Philippe Jetté, President and Chief Executive Officer of Cogeco Communications Inc.

“Our Canadian telecommunications business unit, Cogeco Connexion, performed well during the quarter,” Mr. Jetté noted. “The quarter saw continued organic growth of our Internet service customer base as well as the implementation of several of our network expansion projects, mainly in Québec, and the announcement of new projects that will connect more than 13,800 homes and businesses as part of the Government of Ontario’s Accelerated High Speed Internet Program.”

“In the U.S., Breezeline reported good results in the latest quarter, consistent with our expectations,” Mr. Jetté added. “Performance was strong within our networks outside of Ohio, driven by organic growth in our Internet service customers. Additionally, we continued extending fibre-to-the-home networks to communities in New Hampshire and West Virginia, adjacent to our existing operations. Within Ohio, the transition of the customer base onto our Breezeline platform affected our performance in this region. We are now focussing on running the Ohio business under the Breezeline brand name and will be rolling out our IPTV product in this market by the end of the calendar year.”

“Last week’s decision from the Canadian Radio-television and Telecommunications Commission (CRTC) regarding the terms and conditions under which regional players such as Cogeco will be able to access the mobile networks of incumbents is a positive step in the implementation of the Mobile Virtual Network Operator (MVNO) regulatory framework. The CRTC has denied many unreasonable terms and conditions proposed by incumbents which would have rendered the MVNO regulatory regime ineffective. The CRTC has also determined that eligibility for the MVNO access service is contingent on being a commercial mobile wireless operator somewhere in Canada and this new requirement will need to be factored into our planning, as Cogeco has not yet launched a mobile wireless operation.”

“Looking ahead, we will start adding new Internet customers in fiscal 2023 in areas where we have been investing in network expansion, with contributions to adjusted EBITDA and free cash flow from this customer base expected to begin flowing through in fiscal 2024 and beyond. The Corporation announced a further 10% increase in its dividend today, reflecting its confidence in our growth strategy and outlook.”

“Regarding our ESG practices, once again this year Cogeco was awarded Imagine Canada’s Caring Company certification, which recognizes outstanding leadership in community engagement and social responsibility in this country,” Mr. Jetté stated. “We also recently held our second 1Cogeco Community Involvement Day, an annual company-wide initiative that gives employees an opportunity to engage in local environmental initiatives to support our communities and promote climate action.”

“The year 2022 marks Cogeco’s 65th anniversary and I am very proud of how far we have come since our company’s founding. More than ever, we are in an excellent position to pursue our strategy for sustainable and inclusive growth,” concluded Mr. Jetté.

OPERATING ENVIRONMENT

The current global economic and political instability has resulted in rising inflation and interest rates and, for certain purchased products, more scarcity and longer delivery lead times. While we are proactively working at minimizing the impact on the Corporation, we expect the combination of those elements to continue to put pressure on revenue, as some customers seek ways to reduce their monthly spending, and on the costs to deliver our services.

While the Corporation experienced sustained demand for its residential high-speed Internet product in the context of the COVID-19 pandemic restrictions, a softening of the market is being observed with the re-opening of the economy and a return to the workplace. Although we have conducted our operations normally during the recent quarters, we will remain vigilant should the situation change in the future.

The Corporation’s results discussed herein may not be indicative of future operational trends and financial performance. Please refer to the “Forward-looking statements” section.

FINANCIAL HIGHLIGHTS


Three months ended August 31,

Years ended August 31,


2022

2021

(1)

Change

Change in

constant

currency

(2) (3)

2022

2021

(1)

Change

Changes in

constant

currency

(2) (3)

(In thousands of Canadian dollars, except percentages and per share data)

$

$


%

%


$

$


%

%


Operations













Revenue

725,446

632,684


14.7

12.7


2,900,654

2,510,453


15.5

15.4


Adjusted EBITDA (3)

347,074

290,570


19.4

17.7


1,393,062

1,205,656


15.5

15.5


Adjusted EBITDA margin (3)

47.8 %

45.9 %





48.0 %

48.0 %





Acquisition, integration, restructuring and other costs (4)

12,593

3,974




34,942

8,744




Profit for the period

111,829

103,406


8.1



453,756

431,647


5.1



Profit for the period attributable to owners of the Corporation

104,937

96,200


9.1



423,299

401,517


5.4



Cash flow













Cash flows from operating activities

319,137

281,547


13.4



1,240,282

1,019,059


21.7



Free cash flow (3)

34,452

71,423


(51.8)

(49.2)


424,358

486,877


(12.8)

(12.1)


Acquisition of property, plant and equipment

243,589

179,654


35.6



744,655

537,660


38.5



Net capital expenditures (1) (3)

223,509

175,180


27.6

24.5


688,913

533,186


29.2

28.5


Capital intensity (3)

30.8 %

27.7 %





23.8 %

21.2 %





Financial condition













Cash and cash equivalents







370,899

549,054


(32.4)



Total assets







9,278,509

7,351,692


26.2



Long-term debt













Current







339,096

225,344


50.5



Non-current







4,334,373

3,046,872


42.3



Net indebtedness (3)







4,489,330

2,954,188


52.0



Equity attributable to owners of the Corporation







2,751,080

2,415,144


13.9



Per share data (5)













Earnings per share













Basic

2.29

2.05


11.7



9.16

8.47


8.1



Diluted

2.28

2.03


12.3



9.09

8.40


8.2



Dividends

0.705

0.64


10.2



2.82

2.56


10.2
















(1)

Comparative figures have been restated following the application of the IFRS Interpretations Committee issued agenda decision Demand Deposits with Restrictions on Use arising from a Contract with a Third Party (IAS 7 Statement of Cash Flows) during the third quarter of fiscal 2022. Furthermore, the Corporation also changed the label of its “Acquisition of property, plant and equipment” key performance indicator measure to “Net capital expenditures” following this application. For further details, refer to the “Accounting policies” section of the Management’s Discussion and Analysis (“MD&A”).

(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 rates of the comparable periods of the prior year. For the three-month period and year ended August 31, 2021, the average foreign exchange rates used for translation were 1.2450 USD/CDN and 1.2691 USD/CDN, respectively.

(3)

Adjusted EBITDA and net capital expenditures are total of segments measures. Adjusted EBITDA margin and capital intensity are supplementary financial measures. Free cash flow is a non-IFRS financial measure. Change in constant currency is a non-IFRS ratio. Net indebtedness is a capital management measure. These 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 information on these financial measures, please consult the “Non-IFRS and other financial measures” section of this press release.

(4)

For the three-month period and year ended August 31, 2022, acquisition, integration, restructuring and other costs resulted mostly from the ongoing integration of the Ohio broadband systems, from restructuring costs associated with organizational changes during the fourth quarter of fiscal 2022 within the Canadian telecommunications segment, resulting in cost optimization, as well as from costs associated with configuration and customization related to cloud computing arrangements. For the three-month period and year ended August 31, 2021, acquisition, integration, restructuring and other costs resulted mostly from costs incurred in connection with the acquisition, completed on December 14, 2020, and integration of DERYtelecom, and due diligence costs and legal fees related to the acquisition of the Ohio broadband systems, which was completed on September 1, 2021.

(5)

Per multiple and subordinate voting share.

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 Communications Inc.’s (“Cogeco Communications” 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 regarding 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 Communications believes are reasonable as of the current date. Refer in particular to the “Corporate objectives and strategies” and “Fiscal 2023 financial guidelines” sections of the Corporation’s 2022 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 Communications currently expects. These factors include risks such as competitive risks, business risks (including potential disruption to our supply chain caused by economic and geopolitical instability resulting from the war in Ukraine and other contributing factors, increasing transportation lead times, scarcity and shortage of input materials and key telecommunication equipment and competition for resources), regulatory risks, technology risks (including cybersecurity), financial risks (including variations in currency and interest rates), economic conditions (including elevated inflation reaching historical highs pressuring revenue, due to reduced consumer spending, and increasing costs), human-caused and natural threats to our network, infrastructure and systems, community acceptance risks, ethical behavior risks, ownership risks, litigation risks and public health and safety, many of which are beyond the Corporation’s control. 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 2022 annual MD&A. These factors are not intended to represent a complete list of the factors that could affect Cogeco Communications 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 which represent Cogeco Communications’ 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 2022 Annual Report, the Corporation’s consolidated financial statements and the notes thereto prepared in accordance with the International Financial Reporting Standards (“IFRS”) for the year ended August 31, 2022.

NON-IFRS AND OTHER FINANCIAL MEASURES 

This press release includes references to non-IFRS and other financial measures used by Cogeco Communications. These financial measures are reviewed in assessing the performance of Cogeco Communications and used in the decision-making process with regard to its business units.

Reconciliations between non-IFRS and other financial measures to the most directly comparable IFRS financial measures are provided below. Certain additional disclosures for non-IFRS and other financial measures used in this press release have been incorporated by reference and can be found in the “Non-IFRS and other financial measures” section of the Corporation’s MD&A for the year ended August 31, 2022, available on SEDAR at www.sedar.com.

CONSTANT CURRENCY BASIS AND FOREIGN EXCHANGE IMPACT RECONCILIATION

Consolidated
















Change

Three months ended August 31,

2022

Foreign exchange impact

2022

in constant currency

(1)

2021

Actual

In

constant currency

(In thousands of Canadian dollars, except percentages)

$

$

$


$

%

%

Revenue

725,446

(12,518)

712,928


632,684

14.7

12.7

Operating expenses

372,797

(7,346)

365,451


336,206

10.9

8.7

Management fees – Cogeco Inc.

5,575

5,575


5,908

(5.6)

(5.6)

Adjusted EBITDA

347,074

(5,172)

341,902


290,570

19.4

17.7

Free cash flow

34,452

1,825

36,277


71,423

(51.8)

(49.2)

Net capital expenditures

223,509

(5,434)

218,075


175,180

27.6

24.5









(1)

Fiscal 2022 in constant currency is translated at the average foreign exchange rate of the comparable period of fiscal 2021 which was 1.2450 USD/CDN.

 
















Change

Years ended August 31,

2022

Foreign exchange impact

2022

in constant currency

(1)

2021

Actual

In

constant currency

(In thousands of Canadian dollars, except percentages)

$

$

$


$

%

%

Revenue

2,900,654

(2,881)

2,897,773


2,510,453

15.5

15.4

Operating expenses

1,485,292

(2,460)

1,482,832


1,281,332

15.9

15.7

Management fees – Cogeco Inc.

22,300

22,300


23,465

(5.0)

(5.0)

Adjusted EBITDA

1,393,062

(421)

1,392,641


1,205,656

15.5

15.5

Free cash flow

424,358

3,524

427,882


486,877

(12.8)

(12.1)

Net capital expenditures

688,913

(3,876)

685,037


533,186

29.2

28.5









(1)

Fiscal 2022 in constant currency is translated at the average foreign exchange rate of fiscal 2021, which was 1.2691 USD/CDN.

Canadian telecommunications segment
















Change

Three months ended August 31,

2022

Foreign exchange impact

2022

in constant currency

(1)

2021

Actual

In

constant currency

(In thousands of Canadian dollars, except percentages)

$

$

$


$

%

%

Revenue

360,834

360,834


356,850

1.1

1.1

Operating expenses

163,157

(527)

162,630


171,128

(4.7)

(5.0)

Adjusted EBITDA

197,677

527

198,204


185,722

6.4

6.7

Net capital expenditures

100,140

(1,305)

98,835


76,342

31.2

29.5









(1)

Fiscal 2022 in constant currency is translated at the average foreign exchange rate of the comparable period of fiscal 2021 which was 1.2450 USD/CDN.

 
















Change

Years ended August 31,

2022

Foreign exchange impact

2022

in constant currency

(1)

2021

Actual

In

constant currency

(In thousands of Canadian dollars, except percentages)

$

$

$


$

%

%

Revenue

1,440,276

1,440,276


1,393,097

3.4

3.4

Operating expenses

665,732

(374)

665,358


642,568

3.6

3.5

Adjusted EBITDA

774,544

374

774,918


750,529

3.2

3.2

Net capital expenditures

336,104

(1,500)

334,604


256,636

31.0

30.4









(1)

Fiscal 2022 in constant currency is translated at the average foreign exchange rate of fiscal 2021, which was 1.2691 USD/CDN.

American telecommunications segment
















Change

Three months ended August 31,

2022

Foreign exchange impact

2022

in constant currency

(1)

2021

Actual

In

constant currency

(In thousands of Canadian dollars, except percentages)

$

$

$


$

%

%

Revenue

364,612

(12,518)

352,094


275,834

32.2

27.6

Operating expenses

199,561

(6,819)

192,742


153,903

29.7

25.2

Adjusted EBITDA

165,051

(5,699)

159,352


121,931

35.4

30.7

Net capital expenditures

120,347

(4,129)

116,218


96,989

24.1

19.8









(1)

Fiscal 2022 in constant currency is translated at the average foreign exchange rate of the comparable period of fiscal 2021 which was 1.2450 USD/CDN.

 
















Change

Years ended August 31,

2022

Foreign exchange impact

2022

in constant currency

(1)

2021

Actual

In

constant currency

(In thousands of Canadian dollars, except percentages)

$

$

$


$

%

%

Revenue

1,460,378

(2,881)

1,457,497


1,117,356

30.7

30.4

Operating expenses

783,704

(2,086)

781,618


605,856

29.4

29.0

Adjusted EBITDA

676,674

(795)

675,879


511,500

32.3

32.1

Net capital expenditures

348,176

(2,376)

345,800


271,474

28.3

27.4









(1)

Fiscal 2022 in constant currency is translated at the average foreign exchange rate of fiscal 2021, which was 1.2691 USD/CDN.

 

ORGANIC REVENUE GROWTH IN CONSTANT CURRENCY RECONCILIATION










Three months ended August 31,


Fiscal 2022

revenue

in constant

currency

Impact of

acquisitions

Fiscal 2022

organic revenue

in constant

currency

Fiscal 2021

actual

Organic revenue

growth

in

constant currency

(In thousands of Canadian dollars, except percentages)

$

$

$

$

%

Canadian telecommunications

360,834

360,834

356,850

1.1

American telecommunications

352,094

62,737

289,357

275,834

4.9


712,928

62,737

650,191

632,684

2.8







 

ORGANIC ADJUSTED EBITDA IN CONSTANT CURRENCY RECONCILIATION










Three months ended August 31,


Fiscal 2022

Adjusted EDITDA

in constant

currency

Impact of

acquisitions

Fiscal 2022

organic adjusted

EBITDA in

constant currency

Fiscal 2021

actual

Organic adjusted

EBITDA growth

in constant currency

(In thousands of Canadian dollars, except percentages)

$

$

$

$

%

Canadian telecommunications

198,204

198,204

185,722

6.7

American telecommunications

159,352

23,223

136,129

121,931

11.6

Corporate and eliminations

(15,654)

(15,654)

(17,083)

(8.4)


341,902

23,223

318,679

290,570

9.7







 

FREE CASH FLOW RECONCILIATION



Three months ended August 31,

Years ended August 31,


2022

2021

2022

2021

(In thousands of Canadian dollars)

$

$

$

$

Cash flows from operating activities

319,137

281,547

1,240,282

1,019,059

Amortization of deferred transaction costs and discounts on long-term debt (1)

2,974

2,342

11,815

9,277

Changes in other non-cash operating activities

(30,026)

(50,068)

(74,840)

(40,289)

Income taxes paid

6,871

25,320

36,563

101,715

Current income taxes

(27,430)

(20,331)

(69,513)

(65,070)

Interest paid

39,882

32,185

161,019

123,657

Financial expense

(52,349)

(23,608)

(187,617)

(124,163)

Net capital expenditures

(223,509)

(175,180)

(688,913)

(533,186)

Repayment of lease liabilities

(1,098)

(784)

(4,438)

(4,123)

Free cash flow

34,452

71,423

424,358

486,877






(1)

Included within financial expense.

 

NET CAPITAL EXPENDITURES RECONCILIATION 







Three months ended August 31,

Years ended August 31,


2022

2021

2022

2021

(In thousands of Canadian dollars)

$

$

$

$

Acquisition of property, plant and equipment

243,589

179,654

744,655

537,660

Subsidies received in advance recognized as a reduction of the cost of property, plant and equipment during the period

(20,080)

(4,474)

(55,742)

(4,474)

Net capital expenditures

223,509

175,180

688,913

533,186






 

ADJUSTED EBITDA RECONCILIATION







Three months ended August 31,

Years ended August 31,


2022

2021

2022

2021

(In thousands of Canadian dollars, except percentages)

$

$

$

$

Profit for the period

111,829

103,406

453,756

431,647

Income taxes

17,290

28,466

95,663

130,726

Financial expense

52,349

23,608

187,617

124,163

Depreciation and amortization

153,013

131,116

621,084

510,376

Acquisition, integration, restructuring and other costs

12,593

3,974

34,942

8,744

Adjusted EBITDA

347,074

290,570

1,393,062

1,205,656






 

NET CAPITAL EXPENDITURES AND FREE CASH FLOW EXCLUDING NETWORK EXPANSION PROJECTS RECONCILIATIONS

Net capital expenditures











Three months ended,

Fiscal 2022

Foreign exchange impact

Fiscal 2022

in constant currency

(1)


Nov. 30

Feb. 28

May 31

Aug. 31





(In thousands of Canadian dollars)

$

$

$

$

$

$

$


Net capital expenditures

141,028

142,195

182,181

223,509

688,913

(3,876)

685,037


Net capital expenditures in connection with network expansion projects

20,016

36,982

38,659

61,632

157,289

(1,178)

156,111


Net capital expenditures, excluding network expansion projects

121,012

105,213

143,522

161,877

531,624

(2,698)

528,926











(1)

Fiscal 2022 in constant currency is translated at the average foreign exchange rate of fiscal 2021, which was 1.2691 USD/CDN.

Free cash flow











Three months ended,

Fiscal 2022

Foreign exchange impact

Fiscal 2022

in constant currency

(1)


Nov. 30

Feb. 28

May 31

Aug. 31





(In thousands of Canadian dollars)

$

$

$

$

$

$

$


Free cash flow

132,111

153,000

104,795

34,452

424,358

3,524

427,882


Net capital expenditures in connection with network expansion projects

20,016

36,982

38,659

61,632

157,289

(1,178)

156,111


Free cash flow, excluding network expansion projects

152,127

189,982

143,454

96,084

581,647

2,346

583,993











(1)

Fiscal 2022 in constant currency is translated at the average foreign exchange rate of fiscal 2021, which was 1.2691 USD/CDN.

 
ADDITIONAL INFORMATION

Additional information relating to the Corporation, including its Annual Information Form, is available on the SEDAR website at www.sedar.com or on the Corporation’s website at corpo.cogeco.com.

ABOUT COGECO COMMUNICATIONS INC.

Rooted in the communities it serves, Cogeco Communications Inc. is a growing competitive force in the North American telecommunications sector with a legacy of 65 years. Through its business units Cogeco Connexion and Breezeline (formerly Atlantic Broadband), Cogeco Communications provides Internet, video and phone services to 1.6 million residential and business customers in Québec and Ontario in Canada as well as in thirteen states in the United States. Cogeco Communications Inc.’s subordinate voting shares are listed on the Toronto Stock Exchange (TSX: CCA).

For information:

Investors

Patrice Ouimet

Senior Vice President and Chief Financial Officer

Cogeco Communications Inc.

Tel.: 514-764-4700

[email protected]

Media

Marie-Hélène Labrie

Senior Vice President and Chief Public Affairs, Communications and Strategy Officer

Cogeco Communications Inc.

Tel.: 514-764-4700

[email protected]

Conference Call:

Friday, October 28, 2022 at 11:00 a.m. (Eastern Time)




A live audio webcast will be available on Cogeco Communications’ website at https://corpo.cogeco.com/cca/en/investors/investor-relations/. Members of the financial community will be able to access the conference call and ask questions. Media representatives may attend as listeners only. The webcast will be available on Cogeco Communications’ website for a three-month period.




Please use the following dial-in number to have access to the conference call 10 minutes before the start of the conference:




Local – Toronto: 1-416-764-8646


Toll Free – North America: 1-888-396-8049




In order to join this conference, 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 Communications Inc.

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