- Three-year transformation program fully underway.
- Canadian wireless launch preparation on track, with customer pre-registration now ongoing.
- Year-over-year increase in customer satisfaction, in both Canada and the United States.
- Fiscal 2025 financial guidelines maintained.
- A quarterly dividend of $0.922 per share was declared, representing an 8.0% increase over the prior year.
MONTRÉAL, April 9, 2025 Today, Cogeco Inc. (TSX: CGO) ("Cogeco" or the "Corporation") announced its financial results for the second quarter ended February 28, 2025.
"Our results for the second quarter of fiscal 2025 demonstrate that our new operating model, focused on increasing our agility and competitiveness, is gaining traction," stated Frédéric Perron, President and CEO. "We are particularly pleased with the progress we are making on our transformation initiatives, leading to increased customer satisfaction, while alleviating industry revenue headwinds with ongoing cost reductions.
"Our Internet subscriber growth in Canada remained strong, driven by both our Cogeco and oxio brands. We continued to see modest sequential improvements in Internet subscriber metrics in the U.S., began scaling up our U.S. wireless sales, and kept our Canadian wireless launch preparation on schedule.
"At Cogeco Media, the radio advertising market presents ongoing challenges; however, our digital advertising solutions continue to be a growing contributor to revenue, and our listener engagement remains strong, such as in Montréal, where 7 of the 10 most listened-to programs come from our stations, based on independent data from Numeris.
"Our three-year transformation centered on synergies, digitization, advanced analytics, wireless, and network expansion is beginning to bear fruit. We thank our employees for their hard work and dedication, and our customers and stakeholders for their ongoing support."
Consolidated Financial Highlights
Three months ended | February 28, | February 29, | (1) | Change | Change in constant | (2) | |
(In thousands of Canadian dollars, except % and per share data) (unaudited) | $ | $ | % | % | |||
Revenue | 753,247 | 751,908 | 0.2 | (2.7) | |||
Adjusted EBITDA (2) | 356,905 | 347,782 | 2.6 | (0.2) | |||
Profit for the period | 76,610 | 93,930 | (18.4) | ||||
Profit for the period attributable to owners of the Corporation | 18,172 | 23,997 | (24.3) | ||||
Adjusted profit attributable to owners of the Corporation (2)(3) | 20,329 | 24,346 | (16.5) | ||||
Cash flows from operating activities | 250,080 | 286,382 | (12.7) | ||||
Free cash flow (1)(2) | 112,805 | 100,468 | 12.3 | 10.5 | |||
Free cash flow, excluding network expansion projects (1)(2) | 128,378 | 124,858 | 2.8 | 1.4 | |||
Acquisition of property, plant and equipment | 160,335 | 181,234 | (11.5) | ||||
Net capital expenditures (2)(4) | 158,859 | 171,756 | (7.5) | (10.6) | |||
Net capital expenditures, excluding network expansion projects (2) | 143,286 | 147,366 | (2.8) | (6.3) | |||
Diluted earnings per share | 1.88 | 2.30 | (18.3) | ||||
Adjusted diluted earnings per share (2)(3) | 2.11 | 2.33 | (9.4) | ||||
Operating results
For the second quarter of fiscal 2025 ended on February 28, 2025:
- Revenue remained stable at $753.2 million. On a constant currency basis(2), revenue decreased by 2.7%, mainly explained as follows:
- American telecommunications' revenue decreased by 4.5% on a constant currency basis (increase of 1.5% as reported), mainly due to a decline in our subscriber base, especially for entry-level services, and to a higher proportion of customers subscribing to Internet-only services. The decline was offset in part by a better product mix.
- Canadian telecommunications' revenue decreased by 0.9%, mainly due to a lower revenue per customer as a result of a decline in video and wireline phone service subscribers as an increasing proportion of customers subscribe to Internet-only services, as well as a competitive pricing environment, partly offset by the cumulative effect of high-speed Internet service additions over the past years, including from network expansion projects, as well as from the Niagara Regional Broadband Network acquisition completed on February 5, 2024.
- Revenue in the media activities decreased by 2.7% as competitive dynamics in the radio advertising market remain challenging.
- Adjusted EBITDA increased by 2.6% to $356.9 million. On a constant currency basis, adjusted EBITDA remained stable, driven by cost reduction initiatives and operating efficiencies across the Corporation as a result of our ongoing transformation program, offset by lower revenue in both the American and Canadian telecommunications segments, and higher operating expenses in the Canadian telecommunications segment, in part to drive subscriber growth.
- Canadian telecommunications adjusted EBITDA decreased by 3.2%, or 2.8% in constant currency.
- American telecommunications adjusted EBITDA increased by 6.8%, or 0.5% in constant currency.
- Profit for the period amounted to $76.6 million, of which $18.2 million, or $1.88 per diluted share, was attributable to owners of the Corporation compared to $93.9 million, $24.0 million, and $2.30 per diluted share, respectively, in the comparable period of fiscal 2024. The decreases in profit for the period and profit attributable to owners of the Corporation resulted mainly from higher depreciation and amortization expense, acquisition, integration, restructuring and other costs and income tax expense, partly offset by lower financial expense and the impact of the appreciation of the US dollar against the Canadian dollar.
- Adjusted profit attributable to owners of the Corporation(3) was $20.3 million, or $2.11 per diluted share(3), compared to $24.3 million, or $2.33 per diluted share, last year.
- Net capital expenditures were $158.9 million, a decrease of 7.5% compared to $171.8 million in the same period of the prior year. In constant currency, net capital expenditures(2) were $153.5 million, a decrease of 10.6% compared to last year, mainly due to lower spending in the Canadian telecommunications segment, primarily resulting from lower capital spending related to customer premise equipment and the timing of certain initiatives, offset in part by higher spending in the American telecommunications segment, mainly due to higher costs in relation to customer premise equipment.
- Excluding network expansion projects, net capital expenditures were $143.3 million, a decrease of 2.8% compared to $147.4 million in the same period of the prior year. In constant currency, net capital expenditures, excluding network expansion projects(2) were $138.0 million, a decrease of 6.3% compared to last year, mainly due to the same factors as above.
- Fibre-to-the-home network expansion projects continued, mostly in Canada, with the addition of close to 7,000 homes passed during the second quarter of fiscal 2025.
- Acquisition of property, plant and equipment decreased by 11.5% to $160.3 million, mainly resulting from lower spending.
- Free cash flow(1) increased by 12.3%, or 10.5% in constant currency, and amounted to $112.8 million, or $111.0 million in constant currency(2), mainly due to lower net capital expenditures and financial expense, offset in part by higher acquisition, integration, restructuring and other costs. Free cash flow, excluding network expansion projects(1) increased by 2.8%, or 1.4% in constant currency, and amounted to $128.4 million, or $126.5 million in constant currency.
- Cash flows from operating activities decreased by 12.7% to $250.1 million, mostly due to lower cash from other non-cash operating activities, primarily due to the timing of payments of trade and other payables, as well as the timing of grants received in connection with network expansion projects and the collection of trade accounts receivable, and higher income taxes paid, partly offset by lower interest paid.
- Cogeco maintains its fiscal 2025 financial guidelines as issued on October 31, 2024.
- At its April 9, 2025 meeting, the Board of Directors of Cogeco declared a quarterly eligible dividend of $0.922 per share, an increase of 8.0% compared to $0.854 per share in the comparable quarter of fiscal 2024.
__________ | |
(1) | During the fourth quarter of fiscal 2024, the Corporation updated its calculation of free cash flow and free cash flow, excluding network expansion projects, to include proceeds on disposals of property, plant and equipment, which includes proceeds from sale and leaseback transactions. Comparative figures were restated to conform to the current presentation. For further details, please refer to the "Non-IFRS Accounting Standards and other financial measures" section of this press release. |
(2) | Adjusted EBITDA and net capital expenditures are total of segments measures. Constant currency basis, adjusted profit attributable to owners of the Corporation, net capital expenditures, excluding network expansion projects, free cash flow and free cash flow, excluding network expansion projects are non-IFRS Accounting Standards measures. Change in constant currency and adjusted diluted earnings per share are non-IFRS Accounting Standards ratios. These indicated terms do not have standardized definitions prescribed by IFRS® Accounting Standards, as issued by the International Accounting Standards Board ("IFRS Accounting Standards") and therefore, may not be comparable to similar measures presented by other companies. For more information on these financial measures, please consult the "Non-IFRS Accounting Standards and other financial measures" section of this press release. |
(3) | Excludes the impact of acquisition, integration, restructuring and other costs, net of tax and non-controlling interest. |
(4) | Net capital expenditures exclude non-cash acquisitions of right-of-use assets and the purchases, and related borrowing costs, of spectrum licences, and are presented net of government subsidies, including the utilization of those received in advance. |
Financial highlights
Three and six months ended | February 28, | February 29, | (1) | Change | Change in constant | (2) (3) | February 28, | February 29, | (1) | Change | Change in constant | (2) (3) |
(In thousands of Canadian dollars, except % and per share data) | $ | $ | % | % | $ | $ | % | % | ||||
Operations | ||||||||||||
Revenue | 753,247 | 751,908 | 0.2 | (2.7) | 1,518,207 | 1,528,080 | (0.6) | (2.2) | ||||
Adjusted EBITDA (3) | 356,905 | 347,782 | 2.6 | (0.2) | 727,989 | 713,815 | 2.0 | 0.4 | ||||
Acquisition, integration, restructuring and other costs (gains) (4) | 8,644 | 1,222 | — | (1,004) | 4,487 | — | ||||||
Profit for the period | 76,610 | 93,930 | (18.4) | 185,006 | 192,659 | (4.0) | ||||||
Profit for the period attributable to owners of the Corporation | 18,172 | 23,997 | (24.3) | 47,981 | 58,538 | (18.0) | ||||||
Adjusted profit attributable to owners of the Corporation (3)(5) | 20,329 | 24,346 | (16.5) | 47,550 | 64,384 | (26.1) | ||||||
Cash flow | ||||||||||||
Cash flows from operating activities | 250,080 | 286,382 | (12.7) | 458,735 | 523,301 | (12.3) | ||||||
Free cash flow (1)(3) | 112,805 | 100,468 | 12.3 | 10.5 | 265,256 | 242,546 | 9.4 | 8.6 | ||||
Free cash flow, excluding network expansion projects (1)(3) | 128,378 | 124,858 | 2.8 | 1.4 | 302,628 | 298,596 | 1.4 | 0.7 | ||||
Acquisition of property, plant and equipment | 160,335 | 181,234 | (11.5) | 313,849 | 335,023 | (6.3) | ||||||
Net capital expenditures (3)(6) | 158,859 | 171,756 | (7.5) | (10.6) | 309,775 | 318,423 | (2.7) | (4.6) | ||||
Net capital expenditures, excluding network expansion projects (3) | 143,286 | 147,366 | (2.8) | (6.3) | 272,403 | 262,373 | 3.8 | 1.6 | ||||
Per share data (7) | ||||||||||||
Earnings per share | ||||||||||||
Basic | 1.91 | 2.32 | (17.7) | 5.05 | 4.53 | 11.5 | ||||||
Diluted | 1.88 | 2.30 | (18.3) | 4.97 | 4.50 | 10.4 | ||||||
Adjusted diluted (3)(5) | 2.11 | 2.33 | (9.4) | 4.93 | 4.95 | (0.4) | ||||||
Dividends per share | 0.922 | 0.854 | 8.0 | 1.844 | 1.708 | 8.0 | ||||||
(1) | During the fourth quarter of fiscal 2024, the Corporation updated its calculation of free cash flow and free cash flow, excluding network expansion projects, to include proceeds on disposals of property, plant and equipment, which includes proceeds from sale and leaseback transactions. Proceeds from sale and leaseback and other disposals of property, plant and equipment amounted to $0.9 million and $20.6 million for the three and six-month periods ended February 28, 2025, respectively ($1.6 million and $1.9 million, respectively, for the same periods of fiscal 2024). Comparative figures were restated to conform to the current presentation. For further details, please refer to the "Non-IFRS Accounting Standards and other financial measures" section of this press release. |
(2) | Key performance indicators presented on a constant currency basis are obtained by translating financial results from the current periods denominated in US dollars at the foreign exchange rates of the comparable periods of the prior year. For the three and six-month periods ended February 29, 2024, the average foreign exchange rates used for translation were 1.3452 USD/CDN and 1.3553 USD/CDN, respectively. |
(3) | Adjusted EBITDA and net capital expenditures are total of segments measures. Adjusted profit attributable to owners of the Corporation, free cash flow, free cash flow, excluding network expansion projects and net capital expenditures, excluding network expansion projects are non-IFRS Accounting Standards measures. Change in constant currency and adjusted diluted earnings per share are non-IFRS Accounting Standards ratios. These indicated terms do not have standardized definitions prescribed by IFRS Accounting Standards and therefore, may not be comparable to similar measures presented by other companies. For more information on these financial measures, please consult the "Non-IFRS Accounting Standards and other financial measures" section of this press release. |
(4) | For the three-month period ended February 28, 2025, acquisition, integration, restructuring and other costs were mainly related to restructuring costs incurred, mostly in connection with additional costs related to the new organizational structure announced in May 2024 and other cost optimization initiatives, as well as costs associated with the configuration and customization related to cloud computing and other arrangements. For the six-month period ended February 28, 2025, acquisition, integration, restructuring and other costs (gains) were mostly related to a $13.8 million non-cash gain recognized during the first quarter of fiscal 2025 in connection with a sale and leaseback transaction of a building in Ontario, offset in part by restructuring costs incurred and costs associated with the configuration and customization related to cloud computing and other arrangements. For the three and six-month periods ended February 29, 2024, acquisition, integration, restructuring and other costs were mostly related to costs associated with the configuration and customization related to cloud computing and other arrangements, partly offset by a $4.2 million reversal of a charge, recognized during the second quarter following the Copyright Board decision issued in January 2024 on the redetermination of the 2014-2018 royalty rates. |
(5) | Excludes the impact of acquisition, integration, restructuring and other costs (gains), and gains/losses on debt modification and/or extinguishment, all net of tax and non-controlling interest. |
(6) | Net capital expenditures exclude non-cash acquisitions of right-of-use assets and the purchases, and related borrowing costs, of spectrum licences, and are presented net of government subsidies, including the utilization of those received in advance. |
(7) | Per multiple and subordinate voting share. |
As at | February 28, | August 31, |
(In thousands of Canadian dollars) | $ | $ |
Financial condition | ||
Cash and cash equivalents | 142,018 | 77,746 |
Total assets | 10,252,071 | 9,773,739 |
Long-term debt | ||
Current | 363,288 | 370,108 |
Non-current | 4,844,968 | 4,594,057 |
Net indebtedness (1) | 5,137,472 | 4,957,594 |
Equity attributable to owners of the Corporation | 864,958 | 810,437 |
(1) | Net indebtedness is a capital management measure. For more information on this financial measure, please consult the "Non-IFRS Accounting Standards and other financial measures" section of the Corporation's MD&A for the three and six-month periods ended February 28, 2025, available on SEDAR+ at www.sedarplus.ca. |
Forward-looking statements
Certain statements contained in this press release may constitute forward-looking information within the meaning of securities laws. Forward-looking information may relate to Cogeco Inc.'s ("Cogeco" or the "Corporation") future outlook and anticipated events, business, operations, financial performance, financial condition or results and, in some cases, can be identified by terminology such as "may"; "will"; "should"; "expect"; "plan"; "anticipate"; "believe"; "intend"; "estimate"; "predict"; "potential"; "continue"; "foresee"; "ensure" or other similar expressions concerning matters that are not historical facts. Particularly, statements relating to the Corporation's financial guidelines, future operating results and economic performance, objectives and strategies are forward-looking statements. These statements are based on certain factors and assumptions including expected growth, results of operations, purchase price allocation, tax rates, weighted average cost of capital, performance and business prospects and opportunities, which Cogeco believes are reasonable as of the current date. Refer in particular to the "Corporate objectives and strategy" and "Fiscal 2025 financial guidelines" sections of the Corporation's fiscal 2024 annual Management's Discussion and Analysis ("MD&A") for a discussion of certain key economic, market and operational assumptions we have made in preparing forward-looking statements. While management considers these assumptions to be reasonable based on information currently available to the Corporation, they may prove to be incorrect. Forward-looking information is also subject to certain factors, including risks and uncertainties that could cause actual results to differ materially from what Cogeco currently expects. These factors include risks such as general market conditions, competitive risks (including changing competitive and technology ecosystems and disruptive competitive strategies adopted by our competitors), business risks, regulatory risks, tax risks, technology risks (including cybersecurity), financial risks (including variations in currency and interest rates), economic conditions (including inflation pressuring revenue, trade tariffs, reduced consumer spending and increasing costs), talent management risks (including the highly competitive market for a limited pool of digitally skilled employees), human-caused and natural threats to the Corporation's network (including increased frequency of extreme weather events with the potential to disrupt operations), infrastructure and systems, sustainability and sustainability reporting risks, ethical behavior risks, ownership risks, litigation risks and public health and safety, many of which are beyond the Corporation's control. Moreover, the Corporation's radio operations are significantly exposed to advertising budgets from the retail industry, which can fluctuate due to increased competition and changing economic conditions. For more exhaustive information on these risks and uncertainties, the reader should refer to the "Uncertainties and main risk factors" section of the Corporation's fiscal 2024 annual MD&A and of the fiscal 2025 second-quarter MD&A. These factors are not intended to represent a complete list of the factors that could affect Cogeco and future events and results may vary significantly from what management currently foresees. The reader should not place undue importance on forward-looking information contained in this press release and the forward-looking statements contained in this press release represent Cogeco's expectations as of the date of this press release (or as of the date they are otherwise stated to be made) and are subject to change after such date. While management may elect to do so, the Corporation is under no obligation (and expressly disclaims any such obligation) and does not undertake to update or alter this information at any particular time, whether as a result of new information, future events or otherwise, except as required by law.
All amounts are stated in Canadian dollars unless otherwise indicated. This press release should be read in conjunction with the Corporation's MD&A for the three and six-month periods ended February 28, 2025, the Corporation's condensed interim consolidated financial statements and the notes thereto for the same periods prepared in accordance with IFRS® Accounting Standards as issued by the International Accounting Standards Board ("IFRS Accounting Standards") and the Corporation's fiscal 2024 Annual Report.
Non-IFRS Accounting Standards and other financial measures
This press release includes references to non-IFRS Accounting Standards and other financial measures used by Cogeco. These financial measures are reviewed in assessing the performance of Cogeco and used in the decision-making process with regard to its business units.
Reconciliations between non-IFRS Accounting Standards and other financial measures to the most directly comparable IFRS Accounting Standards measures are provided below. Certain additional disclosures for non-IFRS Accounting Standards and other financial measures used in this press release have been incorporated by reference and can be found in the "Non-IFRS Accounting Standards and other financial measures" section of the Corporation's MD&A for the three and six-month periods ended February 28, 2025, available on SEDAR+ at www.sedarplus.ca. The following non-IFRS Accounting Standards measures are used as a component of Cogeco's non-IFRS Accounting Standards ratios.
Specified non-IFRS Accounting Standards measures | Used in the component of the following non-IFRS Accounting Standards ratios |
Adjusted profit attributable to owners of the Corporation | Adjusted diluted earnings per share |
Constant currency basis | Change in constant currency |
Financial measures presented on a constant currency basis for the three and six-month periods ended February 28, 2025 are translated at the average foreign exchange rate of the comparable periods of the prior year, which were 1.3452 USD/CDN and 1.3553 USD/CDN, respectively.
Constant currency basis and foreign exchange impact reconciliation
Consolidated
Three months ended | February 28, 2025 | February 29, 2024 | (1) | Change | ||||||
(In thousands of Canadian dollars, except percentages) | Actual | Foreign | In constant | Actual | Actual | In constant | ||||
$ | $ | $ | $ | % | % | |||||
Revenue | 753,247 | (21,406) | 731,841 | 751,908 | 0.2 | (2.7) | ||||
Operating expenses | 396,342 | (11,558) | 384,784 | 404,126 | (1.9) | (4.8) | ||||
Adjusted EBITDA | 356,905 | (9,848) | 347,057 | 347,782 | 2.6 | (0.2) | ||||
Free cash flow (1) | 112,805 | (1,760) | 111,045 | 100,468 | 12.3 | 10.5 | ||||
Net capital expenditures | 158,859 | (5,343) | 153,516 | 171,756 | (7.5) | (10.6) | ||||
(1) | During the fourth quarter of fiscal 2024, the Corporation updated its free cash flow calculation to include proceeds on disposals of property, plant and equipment, which includes proceeds from sale and leaseback transactions. Comparative figures were restated to conform to the current presentation. |
Six months ended | February 28, 2025 | February 29, 2024 | (1) | Change | ||||||
(In thousands of Canadian dollars, except percentages) | Actual | Foreign | In constant | Actual | Actual | In constant | ||||
$ | $ | $ | $ | % | % | |||||
Revenue | 1,518,207 | (24,129) | 1,494,078 | 1,528,080 | (0.6) | (2.2) | ||||
Operating expenses | 790,218 | (12,998) | 777,220 | 814,265 | (3.0) | (4.5) | ||||
Adjusted EBITDA | 727,989 | (11,131) | 716,858 | 713,815 | 2.0 | 0.4 | ||||
Free cash flow (1) | 265,256 | (1,964) | 263,292 | 242,546 | 9.4 | 8.6 | ||||
Net capital expenditures | 309,775 | (6,030) | 303,745 | 318,423 | (2.7) | (4.6) | ||||
(1) | During the fourth quarter of fiscal 2024, the Corporation updated its free cash flow calculation to include proceeds on disposals of property, plant and equipment, which includes proceeds from sale and leaseback transactions. Comparative figures were restated to conform to the current presentation. |
Canadian telecommunications segment
Three months ended | February 28, 2025 | February 29, 2024 | Change | |||||||
(In thousands of Canadian dollars, except percentages) | Actual | Foreign | In constant | Actual | Actual | In constant | ||||
$ | $ | $ | $ | % | % | |||||
Revenue | 370,211 | — | 370,211 | 373,479 | (0.9) | (0.9) | ||||
Operating expenses | 177,719 | (634) | 177,085 | 174,720 | 1.7 | 1.4 | ||||
Adjusted EBITDA | 192,492 | 634 | 193,126 | 198,759 | (3.2) | (2.8) | ||||
Net capital expenditures | 74,108 | (580) | 73,528 | 106,345 | (30.3) | (30.9) | ||||
Six months ended | February 28, 2025 | February 29, 2024 | Change | |||||||
(In thousands of Canadian dollars, except percentages) | Actual | Foreign | In constant | Actual | Actual | In constant | ||||
$ | $ | $ | $ | % | % | |||||
Revenue | 747,477 | — | 747,477 | 749,927 | (0.3) | (0.3) | ||||
Operating expenses | 355,507 | (731) | 354,776 | 354,814 | 0.2 | — | ||||
Adjusted EBITDA | 391,970 | 731 | 392,701 | 395,113 | (0.8) | (0.6) | ||||
Net capital expenditures | 148,269 | (700) | 147,569 | 194,181 | (23.6) | (24.0) | ||||
American telecommunications segment
Three months ended | February 28, 2025 | February 29, 2024 | Change | |||||||
(In thousands of Canadian dollars, except percentages) | Actual | Foreign | In constant | Actual | Actual | In constant | ||||
$ | $ | $ | $ | % | % | |||||
Revenue | 362,215 | (21,406) | 340,809 | 357,022 | 1.5 | (4.5) | ||||
Operating expenses | 184,506 | (10,911) | 173,595 | 190,672 | (3.2) | (9.0) | ||||
Adjusted EBITDA | 177,709 | (10,495) | 167,214 | 166,350 | 6.8 | 0.5 | ||||
Net capital expenditures | 80,402 | (4,756) | 75,646 | 62,855 | 27.9 | 20.4 | ||||
Six months ended | February 28, 2025 | February 29, 2024 | Change | |||||||
(In thousands of Canadian dollars, except percentages) | Actual | Foreign | In constant | Actual | Actual | In constant | ||||
$ | $ | $ | $ | % | % | |||||
Revenue | 723,644 | (24,129) | 699,515 | 728,263 | (0.6) | (3.9) | ||||
Operating expenses | 367,123 | (12,255) | 354,868 | 383,743 | (4.3) | (7.5) | ||||
Adjusted EBITDA | 356,521 | (11,874) | 344,647 | 344,520 | 3.5 | — | ||||
Net capital expenditures | 154,129 | (5,319) | 148,810 | 118,708 | 29.8 | 25.4 | ||||
Adjusted profit attributable to owners of the Corporation
Three months ended | Six months ended | |||
February 28, | February 29, | February 28, | February 29, | |
(In thousands of Canadian dollars) | $ | $ | $ | $ |
Profit for the period attributable to owners of the Corporation | 18,172 | 23,997 | 47,981 | 58,538 |
Acquisition, integration, restructuring and other costs (gains) | 8,644 | 1,222 | (1,004) | 4,487 |
Loss on debt extinguishment (1) | — | — | — | 16,880 |
Tax impact for the above items | (2,023) | (308) | (1,824) | (5,641) |
Non-controlling interest impact for the above items | (4,464) | (565) | 2,397 | (9,880) |
Adjusted profit attributable to owners of the Corporation | 20,329 | 24,346 | 47,550 | 64,384 |
(1) | Included within financial expense. |
Free cash flow and free cash flow, excluding network expansion projects reconciliations
Three months ended | Six months ended | |||||
February 28, | February 29, | (1) | February 28, | February 29, | (1) | |
(In thousands of Canadian dollars) | $ | $ | $ | $ | ||
Cash flows from operating activities | 250,080 | 286,382 | 458,735 | 523,301 | ||
Changes in other non-cash operating activities | 24,047 | 1,097 | 104,699 | 59,592 | ||
Income taxes paid (received) | 7,873 | (7,639) | 22,921 | (4,736) | ||
Current income taxes | (9,205) | (8,881) | (24,331) | (16,923) | ||
Interest paid | 64,338 | 70,842 | 128,154 | 135,880 | ||
Financial expense | (65,091) | (70,808) | (132,889) | (155,102) | ||
Loss on debt extinguishment (2) | — | — | — | 16,880 | ||
Amortization of deferred transaction costs and discounts on long-term debt (2) | 2,297 | 2,059 | 3,829 | 4,750 | ||
Net capital expenditures (3) | (158,859) | (171,756) | (309,775) | (318,423) | ||
Proceeds from sale and leaseback and other disposals of property, plant and equipment (1) | 931 | 1,644 | 20,553 | 1,899 | ||
Repayment of lease liabilities | (3,606) | (2,472) | (6,640) | (4,572) | ||
Free cash flow (1) | 112,805 | 100,468 | 265,256 | 242,546 | ||
Net capital expenditures in connection with network expansion projects | 15,573 | 24,390 | 37,372 | 56,050 | ||
Free cash flow, excluding network expansion projects (1) | 128,378 | 124,858 | 302,628 | 298,596 | ||
(1) | During the fourth quarter of fiscal 2024, the Corporation updated its calculation of free cash flow and free cash flow, excluding network expansion projects, to include proceeds on disposals of property, plant and equipment, which includes proceeds from sale and leaseback transactions. Comparative figures were restated to conform to the current presentation. |
(2) | Included within financial expense. |
(3) | Net capital expenditures exclude non-cash acquisitions of right-of-use assets and the purchases, and related borrowing costs, of spectrum licences, and are presented net of government subsidies, including the utilization of those received in advance. |
Net capital expenditures reconciliation
Three months ended | Six months ended | |||
February 28, | February 29, | February 28, | February 29, | |
(In thousands of Canadian dollars) | $ | $ | $ | $ |
Acquisition of property, plant and equipment | 160,335 | 181,234 | 313,849 | 335,023 |
Subsidies received in advance recognized as a reduction of the cost of property, plant and | (1,476) | (9,478) | (4,074) | (16,600) |
Net capital expenditures | 158,859 | 171,756 | 309,775 | 318,423 |
Adjusted EBITDA reconciliation
Three months ended | Six months ended | |||
February 28, | February 29, | February 28, | February 29, | |
(In thousands of Canadian dollars) | $ | $ | $ | $ |
Profit for the period | 76,610 | 93,930 | 185,006 | 192,659 |
Income taxes | 22,335 | 16,993 | 49,671 | 36,374 |
Financial expense | 65,091 | 70,808 | 132,889 | 155,102 |
Depreciation and amortization | 184,225 | 164,829 | 361,427 | 325,193 |
Acquisition, integration, restructuring and other costs (gains) | 8,644 | 1,222 | (1,004) | 4,487 |
Adjusted EBITDA | 356,905 | 347,782 | 727,989 | 713,815 |
Net capital expenditures and free cash flow, excluding network expansion projects reconciliations
Net capital expenditures
Three months ended | February 28, 2025 | February 29, 2024 | Change | |||||||
(In thousands of Canadian dollars, except percentages) | Actual | Foreign | In constant | Actual | Actual | In constant | ||||
$ | $ | $ | $ | % | % | |||||
Net capital expenditures | 158,859 | (5,343) | 153,516 | 171,756 | (7.5) | (10.6) | ||||
Net capital expenditures in connection with network expansion projects | 15,573 | (73) | 15,500 | 24,390 | (36.2) | (36.4) | ||||
Net capital expenditures, excluding network expansion projects | 143,286 | (5,270) | 138,016 | 147,366 | (2.8) | (6.3) | ||||
Six months ended | February 28, 2025 | February 29, 2024 | Change | |||||||
(In thousands of Canadian dollars, except percentages) | Actual | Foreign | In constant | Actual | Actual | In constant | ||||
$ | $ | $ | $ | % | % | |||||
Net capital expenditures | 309,775 | (6,030) | 303,745 | 318,423 | (2.7) | (4.6) | ||||
Net capital expenditures in connection with network expansion projects | 37,372 | (89) | 37,283 | 56,050 | (33.3) | (33.5) | ||||
Net capital expenditures, excluding network expansion projects | 272,403 | (5,941) | 266,462 | 262,373 | 3.8 | 1.6 | ||||
Free cash flow
Three months ended | February 28, 2025 | February 29, 2024 | (1) | Change | ||||||
(In thousands of Canadian dollars, except percentages) | Actual | Foreign | In constant | Actual | Actual | In constant | ||||
$ | $ | $ | $ | % | % | |||||
Free cash flow (1) | 112,805 | (1,760) | 111,045 | 100,468 | 12.3 | 10.5 | ||||
Net capital expenditures in connection with network expansion projects | 15,573 | (73) | 15,500 | 24,390 | (36.2) | (36.4) | ||||
Free cash flow, excluding network expansion projects (1) | 128,378 | (1,833) | 126,545 | 124,858 | 2.8 | 1.4 | ||||
(1) | During the fourth quarter of fiscal 2024, the Corporation updated its calculation of free cash flow and free cash flow, excluding network expansion projects, to include proceeds on disposals of property, plant and equipment, which includes proceeds from sale and leaseback transactions. Comparative figures were restated to conform to the current presentation. |
Six months ended | February 28, 2025 | February 29, 2024 | (1) | Change | ||||||
(In thousands of Canadian dollars, except percentages) | Actual | Foreign | In constant | Actual | Actual | In constant | ||||
$ | $ | $ | $ | % | % | |||||
Free cash flow (1) | 265,256 | (1,964) | 263,292 | 242,546 | 9.4 | 8.6 | ||||
Net capital expenditures in connection with network expansion projects | 37,372 | (89) | 37,283 | 56,050 | (33.3) | (33.5) | ||||
Free cash flow, excluding network expansion projects (1) | 302,628 | (2,053) | 300,575 | 298,596 | 1.4 | 0.7 | ||||
(1) | During the fourth quarter of fiscal 2024, the Corporation updated its calculation of free cash flow and free cash flow, excluding network expansion projects, to include proceeds on disposals of property, plant and equipment, which includes proceeds from sale and leaseback transactions. Comparative figures were restated to conform to the current presentation. |
Additional information
Additional information relating to the Corporation is available on SEDAR+ at www.sedarplus.ca and on the Corporation's website at corpo.cogeco.com.
About Cogeco Inc.
Cogeco Inc. is a North American leader in the telecommunications and media sectors. Through Cogeco Communications Inc., we provide world-class Internet, video and wireline phone services to 1.6 million residential and business subscribers in Canada and thirteen states in the United States. We also offer wireless services in most of our U.S. operating territory. Through Cogeco Media, we operate 21 radio stations in Canada, primarily in the province of Québec, as well as a news agency. We take pride in our strong presence in the communities we serve and in our commitment to a sustainable future. Both Cogeco Inc.'s and Cogeco Communications Inc.'s subordinate voting shares are listed on the Toronto Stock Exchange (TSX: CGO and CCA).
For information:
Investors
Troy Crandall
Head, Investor Relations
Cogeco Inc.
Tel.: 514 764-4600
[email protected]
Media
Claudja Joseph
Director, Communications
Cogeco Inc.
Tel.: 514 764-4600
[email protected]
Conference Call: | Thursday, April 10, 2025 at 11:00 a.m. (Eastern Daylight Time) |
A live audio webcast of the analyst call will be available on both the Investor Relations and the Events and Presentations pages of Cogeco's website. Financial analysts will be able to access the live conference call and ask questions. Media representatives may attend as listeners only. A recording of the conference call will be available on Cogeco's website for a three-month period. | |
Please use the following dial-in number to access the conference call 10 minutes before the start of the conference: | |
Local - Toronto: 1 289 514-5100 | |
Toll Free - North America: 1 800 717-1738 | |
To join this conference call, participants are required to provide the operator with the name of the company hosting the call, that is, Cogeco Inc. or Cogeco Communications Inc. |
SOURCE Cogeco Inc.
