|Note: This is a summary of highlights. To see the complete news release on this matter, including financial charts, click here.|
- Fourth Quarter Consolidated Revenue Increases 3% to $3.2 Billion, Adjusted Net Income Per Share up 5% to $0.64;
- Wireless Adds 123,000 Net New Subscribers, Activates and Upgrades a Record 635,000 Smartphones, and Accelerates Wireless Data Revenue Growth to 32%;
- Cable Operations Adjusted Operating Profit Increases 16% Driving Margins to 46.1% on Continued Subscriber Growth and Cost Efficiencies;
- $531 Million of Cash Returned to Rogers Shareholders in Dividends and Share Buybacks
Rogers Communications Inc. today announced its unaudited consolidated financial and operating results for the three and twelve months ended December 31, 2010.
“While the top line and subscriber growth rates moderated in the quarter from 2009, we held our expenditures in solid check enabling us to continue to invest at a healthy rate in customer retention, network enhancement and product development initiatives,” said Nadir Mohamed, President and Chief Executive Officer of Rogers Communications Inc. “I’m pleased to report that we met or exceeded all of our key financial commitments in 2010, while further strengthening our already healthy balance sheet and returning more than $2 billion of cash to shareholders through a combination of dividends and share buybacks.”
Highlights of the fourth quarter of 2010 include the following:
- Generated consolidated quarterly revenue growth of 3%, with Wireless network revenue growth of 3%, Cable Operations revenue growth of 2%, and Media revenue growth of 9%, versus the same quarter last year. Consolidated adjusted operating profit was down 2%. While Cable Operations adjusted operating profit increased by 16%, this was offset by a 6% decline at Wireless primarily reflecting costs associated with the significant year-over-year increase in smartphone activations and a 33% decline at Media related to increased programming costs for the start-up of the Sportsnet ONE television network.
- Wireless network revenue growth was fuelled by data revenue growth of 32% and net subscriber additions of 123,000. Wireless data revenue now comprises 31% of Wireless network revenue and was helped by the activation and upgrade of a record 635,000 additional smartphones during the quarter, of which approximately 29% were for subscribers new to Wireless. The number of new smartphone subscribers was the highest ever in a quarter. This resulted in subscribers with smartphones, who typically generate ARPU nearly twice that of voice only subscribers, representing 41% of the overall postpaid subscriber base as at December 31, 2010, up from 31% as at December 31, 2009.
- Wireless commenced a Long Term Evolution (“LTE”) wireless network technical trial in the Ottawa area. LTE is a fourth generation (“4G”) wireless technology that enables network speeds of up to 150 Mbps. The trial seeks to validate how LTE technology performs across a variety of spectrum frequencies in urban, suburban and rural environments, as well as actual throughput speeds, performance quality and interoperability with our existing HSPA+ network.
- Cable grew total service units (television, Internet and telephony subscribers) by 17,000 during the quarter, with Internet subscriber penetration now at 73% of television subscribers and residential voice-over-cable telephony penetration at 44% of television subscribers.
- Rogers Business Solutions (“RBS”) closed the acquisition of Atria Networks, one of Ontario’s largest fibre-optic data services networks, in January 2011. This acquisition will augment RBS’s small and medium-sized business offerings by enhancing its ability to deliver on-net data centric services within and adjacent to Cable’s footprint.
- Media closed the acquisition of BV! Media Inc., a Canadian Internet advertising network and publisher of news and information portals. Media also closed agreements to acquire two radio stations in the Edmonton, Alberta and London, Ontario markets, in January 2011.
- We launched a dividend reinvestment plan (“DRIP”), whereby Rogers investors are able to automatically reinvest their quarterly dividends to purchase additional Rogers Class B Non-Voting common shares without paying commissions, service charges or brokerage fees.
- We increased our ownership position in Cogeco Cable Inc. and Cogeco Inc. for investment purposes, with the acquisition of 892,250 subordinate voting shares of Cogeco Cable Inc. and 946,090 subordinate voting shares of Cogeco Inc.
- We repurchased 10.1 million RCI Class B Non-Voting common shares for $347 million during the quarter under our $1.5 billion share buyback authorization and paid dividends on our common shares totalling $184 million.
- For the full year 2010, free cash flow, defined as adjusted operating profit less property, plant & equipment (“PP&E”) expenditures and interest on long-term debt, increased 14% to $2.1 billion. Free cash flow per share increased by 23% over full year 2009 reflecting the growth in underlying free cash flow and the accretion from share buybacks which have decreased the base of outstanding shares.
- For the year, we repurchased 37.1 million of our Class B Non-Voting common shares for $1,312 million and paid dividends totalling $734 million, in total returning $2.0 billion in cash to shareholders in 2010.
- We also announced today that our Board of Directors has approved a 11% increase in the annualized dividend to $1.42 per share effective immediately, and that it has approved the renewal of our normal course issuer bid (“NCIB”) program for the repurchase of up to $1.5 billion of RCI shares on the open market during the next twelve months.
This summary of our fourth quarter 2010 earnings release should be read in conjunction with the full version of our fourth quarter 2010 earnings release, our 2009 Annual MD&A and our 2009 Annual Audited Consolidated Financial Statements and Notes thereto, as well as our 2010 quarterly interim financial statements and other recent securities filings available on SEDAR at http://www.sedar.com/. As this earnings release includes forward-looking statements and assumptions, readers should carefully review the sections of this earnings release entitled “Caution Regarding Forward-Looking Statements, Risks and Assumptions”.
In this earnings release, the terms “we”, “us”, “our”, “Rogers” and “the Company” refer to Rogers Communications Inc. and our subsidiaries, which are reported in the following segments: “Wireless”, “Cable”, and “Media”.
About Rogers Communications Inc.
Rogers Communications is a diversified Canadian communications and media company. We are Canada’s largest provider of wireless voice and data communications services and one of Canada’s leading providers of cable television, high-speed Internet and telephony services. Through Rogers Media we are engaged in radio and television broadcasting, televised shopping, magazines and trade publications, and sports entertainment. We are publicly traded on the Toronto Stock Exchange (TSX: RCI.A and RCI.B) and on the New York Stock Exchange (NYSE: RCI). For further information about the Rogers group of companies, please visit rogers.com.
Quarterly Investment Community Conference Call
As previously announced by press release, a live webcast of our quarterly results conference call with the investment community will be broadcast via the Internet at rogers.com/webcast beginning at 8:00 a.m. ET today, February 16, 2011. A rebroadcast of this teleconference will be available on the Webcast Archive page of the Investor Relations section of rogers.com for a period of at least two weeks following the conference call.
For further information:
Investment Community Contacts