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Rogers Communications Inc.
2003 Annual Report

Table of contents

  • Page 1
    Rogers Communications Inc. 2003 Annual Report

  • Page 2

  • Page 3
    ... customers. This core belief is the foundation upon which we have built a unique and vibrant mix of cable, wireless, Internet and media offerings that touch the lives of Canadians every day, year-after-year. Our products share not just a common heritage, but a common brand as well - the Rogers brand...

  • Page 4
    ...network coverage > Clicks onto The Shopping Channel > Loves VOD and PVR from Rogers Cable > Uses Hi-Speed Internet access from Rogers Cable > Uses a BlackBerry from Rogers Wireless > Subscribes to Rogers Digital Cable TV > Follows Canadian Business magazine or Moneysense.ca 2 2 0 0 3 Annual Report...

  • Page 5
    ... wireless voice and data network, a network built on the global standard for wireless communications technology, GSM/GPRS. Whether you are a business or a consumer, Rogers Wireless offers an extensive choice of wireless services and pricing packages to suit your needs. Rogers Media is a powerful...

  • Page 6
    ... plans. For added convenience, we provide our customers with a combined bill and single point of contact for all of their Rogers products. Rogers' VIP program offers qualified customers great pricing on their cable TV, as well as additional value on their Hi-Speed Internet, wireless services...

  • Page 7
    ... > Best value for cable, Internet and wireless services > Access to desktop and e-mail while out of office > New meal planning ideas > Video and snacks for babysitter and kids > To keep in touch with distant relative > Wireless coverage while on European trip ROGERS SOLUTION > Uses Rogers Hi-Speed...

  • Page 8
    ...with Rogers Cable's VOD > Visit one of Rogers Wireless' thousands of locations > Watch OMNI and Fairchild TV on Rogers Cable > Choose Family Plan and Calling Circles from Rogers Wireless > Tune to JackFM radio > Become Rogers "one-bill" subscriber 6 2 0 0 3 Annual Report Rogers Communications Inc...

  • Page 9
    ... provides local calling between Family Plan members. With 24-hour-a-day, 7-day-a-week shopping and self-directed customer service at rogers.com our customers can perform a host of functions at their convenience. Rogers Cable offers flexible 7-day-a-week installations and home servicing guaranteed...

  • Page 10
    ...business market. In mid-2005, Rogers Cable intends to introduce a high-quality digital local telephone service with many of today's popular calling features plus many new services that will be enabled by the advanced Internet Protocol ("IP") platform. 8 2 0 0 3 Annual Report Rogers Communications...

  • Page 11
    ...service to its new and existing customers at more than 7,000 points of distribution that include Rogers Plus, Rogers Video and RadioShack stores across Canada. Customers can also purchase wireless devices and features or make changes to their account, 24 hours a day, 7 days a week, at www.rogers.com...

  • Page 12
    ..., Toronto, Calgary and Vancouver; the OMNI.1 and OMNI.2 multicultural television stations in Ontario; its Rogers Sportsnet regional sports network, which provides regional sports programming across Canada; and The Shopping Channel, Canada's only nationally televised shopping service. Broadcasting...

  • Page 13
    ...20 years, employee volunteers in red Rogers Cable vans have patrolled the communities served by Rogers, working with local police and other emergency services to keep kids safe on Halloween. Rogers Television. Our 31 local stations in Ontario, New Brunswick and Newfoundland produce over 19,000 hours...

  • Page 14
    ... access with the first commercial launch in North America in 1995 and now approximately 25% of homes passed are Internet customers. With 99% of its network digital-ready, Rogers Cable offers an extensive array of high definition television, a suite of Rogers on Demand services (including video...

  • Page 15
    ... Rogers, O.C. PRESIDENT AND CHIEF EXECUTIVE OFFICER R O G E R S C O M M U N I C AT I O N S I N C . To our shareholders In 2003, Rogers Communications delivered double-digit growth in both revenue and operating profit through continued subscriber growth, greater customer retention levels, operating...

  • Page 16
    ... of wired and wireless telephone services. Wireless powers ahead as data gains traction At Rogers Wireless, 2003 was a year when essentially all of the key business metrics were moving in the right direction - wireless voice and data subscribers up 11% to 3.8 million, network revenue up 16...

  • Page 17
    ...plans to overlay Enhanced Data Rates for Global Evolution ("EDGE") technology in 2004 to further increase data speeds. Today, Rogers Wireless has arguably the most robust and comprehensive portfolio of wireless data services in Canada - a portfolio that addresses the simplest of youth text messaging...

  • Page 18
    ... our extensive distribution channels and retail presence from across the group to attract customers. We're utilizing common call centres and issuing common bills to service customers who take more than one of our products. Our Rogers Video stores serve as a window on the community, not only...

  • Page 19
    ... Consolidated Statements of Income Consolidated Statements of Deficit Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements Directors and Corporate Officers Corporate Information 18 68 71 71 72 73 73 74 75 107 108 Rogers Communications Inc. 2 0 0 3 Annual Report 17

  • Page 20
    ..., sales channels and marketing opportunities across the Rogers Group of Companies to create value for its customers and shareholders. RCI helps to identify and facilitate opportunities for its cable, wireless and media businesses to create bundled product and service offerings, as well as...

  • Page 21
    ... that Rogers Telecom offers voice-over-cable telephony services, Cable would enter into an agreement with Rogers Telecom which could relate to, among other things, access to and the use of Cable's network. For a more detailed discussion of the business strategies of the Cable, Wireless and Media...

  • Page 22
    ... day-to-day basis and service existing subscriber relationships, including retention costs, inter-carrier payments to roaming partners and long-distance carriers, programming related costs, Internet and e-mail services and printing and production costs. In the wireless and cable industries in Canada...

  • Page 23
    ..., radio, television and specialty services. Industry Canada The technical aspects of the operation of radio and television stations, frequency-related operations of the cable television networks and the awarding of spectrum for cellular, messaging and other radio-telecommunications systems in Canada...

  • Page 24
    ... to the marketing and delivery of wireless services with AWE, one of Wireless' significant shareholders. Each of Wireless, Cable and Media has entered into a management services agreement under which the Company provides a range of services, including strategic planning, financial and information...

  • Page 25
    ... and media subscriptions are recorded as revenue on a pro rata basis over the month; • revenue from wireless airtime, wireless long-distance and optional services, pay-per-view and video on demand movies, installation and activation charges, video rentals and other transactional sales of products...

  • Page 26
    ... On an annual basis, the Company reviews assumptions related to defined benefit pension plans. As a result, the assumptions related to the weighted average discount rate for accrued benefit obligations remains at 6.25%, the weighted average expected long-term rate of return on plan assets remains...

  • Page 27
    ... using quoted market price or discounted cash flows. The adoption of the new pronouncement had no impact on the Company as no impairment of long-lived assets had occurred at December 31, 2003. RECENT ACCOUNTING DEVELOPMENTS GAAP Hierarchy Until now, there has been no clear definition of the order...

  • Page 28
    ...television systems; accounting for development and pre-operating costs; accounting for internal interest capitalization and the related depreciation impact; classification of certain equity instruments and the related interest and accretion; shares used in connection with the purchase of a business...

  • Page 29
    ... related deferred income taxes. As a result of accounting for gains on sale and exchanges of certain cable television systems under U.S. GAAP, the Company's income for U.S. GAAP was decreased by $4.0 million for the years ended December 31, 2003 and 2002. Accounting for Development and Pre-Operating...

  • Page 30
    ... margins in all three divisions. Refer to the respective individual segment discussions for details of the revenue, operating expenses, operating profit and property, plant and equipment ("PP&E") capital expenditures of Cable, Wireless and Media. 28 2 0 0 3 Annual Report Rogers Communications...

  • Page 31
    ...2003. Wireless Change in the Estimate of Sales Tax In 2002, Wireless received clarification with respect to a potential sales tax liability that the Company had recorded as an expense in previous periods. As a result, Wireless released a $19.2 million provision related to previous years' operations...

  • Page 32
    ...by the controlling shareholder of Rogers, RTL acquired voting control of the Blue Jays. The Company currently accounts for this investment using the equity method and records 100% of the operating losses of the Blue Jays. The agreement with RTL did not change as a result of the Company's purchase of...

  • Page 33
    ... discussions below. Total remuneration paid to employees (both full and part time) in 2003 was approximately $801.0 million, an increase of $30.0 million, or 3.9%, from $771.0 million in the prior year. ROGERS CABLE CABLE OVERVIEW Rogers Cable is Canada's largest cable television company, serving...

  • Page 34
    .... and Best Buy Canada. Cable also offers products and services and customer service on its e-business Web site, www.rogers.com. Cable Networks Cable's cable networks in Ontario and New Brunswick, with few exceptions, are interconnected to regional head-ends, where analog and digital channel line-ups...

  • Page 35
    ...companies to offer expanded packages of analog and digital cable television services, including VOD, PPV services, expanded analog and digital services pay television packages, interactive television services, HDTV programming and Internet services. Rogers Communications Inc. 2 0 0 3 Annual Report...

  • Page 36
    ... illegally give a false U.S. service address to the U.S. DBS providers, paying a fee to receive programming services not offered for sale in Canada. Unauthorized access by Canadian residents with pirate DTH equipment and theft of Canadian 34 2 0 0 3 Annual Report Rogers Communications Inc.

  • Page 37
    ... received from its customers by selling multiple products to them and to better service its customers by offering a single bill and single points of customer service contact. Late in 2003, Cable and Rogers Wireless launched a combined bundle which offered combinations of their video, high-speed...

  • Page 38
    ... acquisition of rental assets; • sales and marketing expenses, which include sales and retention-related advertising and customer communications as well as other acquisition costs such as sales support and commissions and costs of operating, advertising and promoting the Rogers Video store chain...

  • Page 39
    ... contract agreements with various production studios to bring the total number of available titles to over 1,000. • Cable increased the throughput of its Hi-Speed Internet service up to 3Mbps, introduced its first PVR, and launched 9 new HDTV channels. • Seven new Rogers Video stores were added...

  • Page 40
    .... Cable operating, general and administrative expenses increased by $47.1 million or 6.6% in 2003 over 2002. The increase related to increased costs of programming and Internet transit and e-mail costs, associated with the growth in digital and Internet subscribers. Total Rogers Video stores cost of...

  • Page 41
    ... existing subscribers while increasing pricing or new products and services, or failure to keep pace with changing consumer preferences for cable and Internet services, could slow revenue growth and have a material adverse effect on Cable's business and financial condition. Rogers Communications...

  • Page 42
    ... elements of its network infrastructure and information technology systems are located at either of two sites: the corporate offices in Toronto and Cable's Toronto operations facility. In the event that Cable cannot access these facilities, 40 2 0 0 3 Annual Report Rogers Communications Inc.

  • Page 43
    ...competing high-speed Internet services at retail. The increased competition and reduced network capacity could result in a reduction of revenue. Required Access to Support Structures and to Municipal Rights of Way Cable requires access to support structures and to municipal rights of way in order to...

  • Page 44
    ... stores. Wireless also offers many of its products and services through a retail agreement with Rogers Video that had 279 locations across Canada at December 31, 2003. Wireless also offers products and services and customer service on its e-business Web site, www.rogers.com. Wireless Networks...

  • Page 45
    ...video capability. These networks are expected to support a variety of data applications, including high-speed Internet access, multimedia services and seamless access to corporate information systems, such as e-mail and purchasing systems. As discussed above, Wireless began trials of EDGE technology...

  • Page 46
    ... million wireless subscribers. Competition for wireless subscribers is based on price, scope of services, service coverage, quality of service, sophistication of wireless technology, breadth of distribution, selection of equipment, brand and marketing. In the wireless voice and data market, Wireless...

  • Page 47
    ... of dollars, except margins) Years Ended December 31, 2003 2002 % Chg Operating revenue Postpaid (voice and data)1 Prepaid One-way messaging Network revenue Equipment revenue Total operating revenue Operating expenses Cost of equipment sales Sales and marketing expenses Operating, general and...

  • Page 48
    Management's Discussion and Analysis Wireless Operating Highlights and Significant Developments of 2003 • Network revenue increased 16.0% and operating profit increased 37.9% compared to 2002. Operating profit margin based on network revenue rose by 570 basis points year-over-year to 35.7%. • ...

  • Page 49
    ... on customer retention aims to ensure that customers receive responsive, quality service at every point of contact with Wireless. Wireless attributes the increase in prepaid churn to 2.82% in the current year to the impact of competitive prepaid offers. One-way messaging (or "paging") subscriber...

  • Page 50
    ... year-over-year reduction reflects scale economies from the larger subscriber base, roaming cost reductions, and improved efficiencies in call centre and network maintenance operations offset by increased costs related to customer retention. At December 31, 2003, Wireless, as a result of its sales...

  • Page 51
    ... widespread acceptance is not compatible with Rogers Wireless' networks, competing services based on such alternative technology may be preferable to subscribers. Potential Impact of Change in Foreign Ownership Legislation Wireless could face increased competition if, as discussed in "Overview of...

  • Page 52
    ..., manage subscriber churn, produce accurate and timely subscriber bills, generate revenue growth and manage operating expenses, all of which could adversely impact Wireless' financial results and financial position. In addition, Wireless uses standard network and information technology security...

  • Page 53
    ... print media platforms, the Media group also delivers content over the Internet relating to many of its individual broadcasting and publishing properties. MEDIA STRATEGY OVERVIEW Media seeks to maximize revenues, operating profit and return on invested capital across each of its businesses. Media...

  • Page 54
    Management's Discussion and Analysis MEDIA COMPETITION Broadcasting's radio stations compete with the other stations in their respective market areas as well as with other media such as newspapers, television, outdoor advertising, direct mail marketing and the Internet. Competition within the radio...

  • Page 55
    Management's Discussion and Analysis Summarized Media Financial Results (In millions of dollars, except margins) Years Ended December 31, 2003 2002 % Chg Operating revenue Publishing Radio Television The Shopping Channel Corporate items, eliminations and other Total operating revenue Operating ...

  • Page 56
    .... Total operating profit was $106.7 million in 2003, resulting in a year-over-year increase of 21.8%, or $19.1 million, which was primarily attributable to the results at Television. Details of operating expenses of each of the Media divisions are discussed below. 54 2 0 0 3 Annual Report Rogers...

  • Page 57
    ... both advertising and subscriber fees from cable and satellite customers across Canada. Revenue from Rogers Sportsnet increased year-over-year by $16.5 million in 2003. OMNI.2 television began broadcasting during the third quarter of 2002 in the Toronto, Hamilton, Ottawa and London, Ontario markets...

  • Page 58
    ...'s business, financial condition or results of operations. Emergence of Competing Technologies New programming or content services, as well as alternative media technologies, such as digital radio services, satellite radio, DTH satellite, wireless and wired pay television, Internet radio and video...

  • Page 59
    ...currently considering a policy change which could require cable BDUs to carry mandatory services (i.e. APTN, CPAC and TVA) below the first cable tier. This decision, along with the licensing of new local TV stations, has the potential to affect The Shopping Channel's placement in some cable systems...

  • Page 60
    ...million was received for the issuance of Class B Non-Voting Shares under employee share purchase plans and the exercise of employee stock options and $239.0 million was received upon the issuance of 12,722,647 Class B Non-Voting Shares in May 2003. 58 2 0 0 3 Annual Report Rogers Communications Inc.

  • Page 61
    Management's Discussion and Analysis Including the $853.9 million of cash generated from operations after changes in working capital, the aggregate net funds raised in 2003 totaled $1,650.6 million. The net funds used during 2003 totalled approximately $1,687.7 million consisting of: • additions ...

  • Page 62
    ... the deployment of an advanced Internet Protocol multimedia network to support primary line voice-over-cable telephony and other new services across its cable service areas as discussed in "Overview - Telephony Initiative" above. Cable expects operating profit to increase in 2004 and anticipates...

  • Page 63
    ...and the percentage of its exposure by business unit that has been hedged as at December 31, 2003. Business Unit U.S. dollar Debt ($ millions) % hedged Cable Wireless Rogers Corporate Total $ 1,305.2 1,353.3 209.8 2,868.3 81.1% 65.4 - 67.8% 61 $ Rogers Communications Inc. 2 0 0 3 Annual Report

  • Page 64
    ... 90 days notice. Accounts Receivable The Company manages the subscriber account collection of activities of Wireless and Cable. Wireless and Cable are responsible, however, for the costs incurred in the collection and handling of their accounts. 62 2 0 0 3 Annual Report Rogers Communications Inc...

  • Page 65
    ... entered into an agreement for the sale of the Company's products and services through the Rogers Video retail outlets owned by Cable. Wireless pays Cable commissions for new subscriptions equivalent to amounts paid to third-party distributors. Rogers Communications Inc. 2 0 0 3 Annual Report 63

  • Page 66
    ... local and long-distance telephone and data transmission services to business customers in Canada. This strategic alliance included, among other things, a brand licence agreement under which Wireless was granted a licence to use, on a co-branded basis, the AT&T brand in connection with the marketing...

  • Page 67
    Management's Discussion and Analysis Over-the-Air Activation Agreement Wireless currently utilizes the services of AWE for automated "over-the-air" ("OTA") programming of subscriber handsets. The current agreement with AWE expires March 31, 2004, at which time the Company will assume responsibility...

  • Page 68
    ... are currently scheduled to be made on the first trading day following January 1 and July 1 in each year. As noted below, the first such semi-annual dividend pursuant to the policy was paid July 2, 2003. Payment of these dividends on the Class A Voting and Class B Non-Voting Shares requires...

  • Page 69
    ... programming production funds. The Company estimates that Rogers Video will spend approximately $62.7 million in 2004 on the acquisition of videocassettes, DVDs and video games (as well as non-rental merchandise) for rental or sale in Rogers Video stores. In addition, the Company expects to pay...

  • Page 70
    ...8,465,495 1 As defined in "Key Performance Indicators - Operating Profit and Profit Margin" section. 2 Cash flow from operations before changes in working capital amounts. 3 Restated for the change in accounting of foreign exchange translation. 68 2 0 0 3 Annual Report Rogers Communications Inc.

  • Page 71
    ...) $ 38.0 37.1 10.8 32.8 277,602 244,722 $ $ 244,108 222,312 $ $ 188,543 188,950 2 As defined in "Key Performance Indicators - Operating Profit and Profit Margin" section. 3 Cash flow from operations before changes in working capital amounts. Rogers Communications Inc. 2 0 0 3 Annual Report 69

  • Page 72
    ...) $ 34.6 30.9 10.0 28.3 173,344 305,359 $ $ 174,415 324,656 $ $ 125,995 242,043 2 As defined in "Key Performance Indicators - Operating Profit and Profit Margin" section. 3 Cash flow from operations before changes in working capital amounts. 70 2 0 0 3 Annual Report Rogers Communications Inc.

  • Page 73
    ... information presented elsewhere in Management's Discussion and Analysis and has ensured that it is consistent with the financial statements. Management of Rogers Communications Inc., in furtherance of the integrity of the financial statements, has developed and maintains a system of internal...

  • Page 74
    ... events (notes 6(a) and 23) See accompanying notes to consolidated financial statements. $ 8,524,503 On behalf of the Board: Edward S. Rogers Chief Executive Officer and Director H. Garfield Emerson Chairman of the Board of Directors 72 2 0 0 3 Annual Report Rogers Communications Inc.

  • Page 75
    ...In thousands of dollars) Years ended December 31, 2003 and 2002 2003 2002 Deficit, beginning of year Net income for the year Dividends on Class A Voting and Class B Non-Voting Shares Dividends on Series E Preferred Shares Distribution on Convertible Preferred Securities (note 11(c)) Accretion on...

  • Page 76
    ... termination of cross-currency interest rate exchange agreements Premium on early repayment of long-term debt Financing costs incurred Redemption of Preferred and Collateralized equity instruments Issue of capital stock Distribution on Convertible Preferred Securities Dividends on Class B Non-Voting...

  • Page 77
    ..., Internet access and video retailing through its wholly owned subsidiary, Rogers Cable Inc. ("Cable"), wireless voice, messaging and data services through its 55.8% ownership of Rogers Wireless Communications Inc. ("Wireless"), and in radio and television broadcasting, televised home shopping and...

  • Page 78
    ... video rental inventory is charged to operating expense on a diminishing-balance basis over a six-month period. (j) Pension benefits: The Company accrues its pension plan obligations as employees render the services necessary to earn the pension. The Company uses the current settlement discount rate...

  • Page 79
    ..., equipment rental and media subscriptions, are recorded as revenue on a pro rata basis over the month; (ii) Revenue from wireless airtime, wireless long-distance and optional services, pay-per-view and video on demand services, video rentals and other transactional sales of products are recorded...

  • Page 80
    .... Sales and marketing and other associated costs related to the acquisition of new wireless, cable and media subscribers are expensed as incurred. (p) Stock-based compensation and other stock-based payments: The Company has a stock option plan for employees and directors. All stock options issued...

  • Page 81
    ... which were accounted for by the purchase method. (a) Standard Radio Inc.: In April 2002, the Company acquired the assets of 13 radio stations from Standard Radio Inc. for total cash consideration of $103.4 million. The stations operate as an AM station in Toronto (the FAN), an FM station in Orillia...

  • Page 82
    ... (b) Rogers Wireless Communications Inc.: On March 20, 2002, the Company exchanged, with five institutional investors, 4,305,830 Class B Non-Voting shares of the Company for 4,925,000 Wireless Class B Restricted Voting shares. This transaction increased the Company's ownership in Wireless from...

  • Page 83
    ... a straight-line basis to expense over the 15-year term of the brand licence agreement. In December 2003, Wireless announced that it would terminate its brand licence agreement in early 2004 and change its brand name to exclude the AT&T brand. Consequently, the Company determined the useful life of...

  • Page 84
    ... Cable Inc.: In March 2003, the Company entered into agreements to purchase 3.0 million Subordinate Voting shares of Cogeco Cable Inc. ("Cogeco") in exchange for 2.7 million Class B Non-Voting shares of the Company from a group of investors unaffiliated 82 2 0 0 3 Annual Report Rogers Communications...

  • Page 85
    ... 30, 2000 (the "accreted floor price") until June 30, 2003, or such earlier time as a minority shareholder of AT&T Canada exercised its obligation to acquire all of the shares and Deposit Receipts of AT&T Canada. On June 25, 2002, AT&T Corp. announced its intention to purchase, for cash, the Deposit...

  • Page 86
    ... Voting shares of Wireless - $ - (37,246) (19,745) 1,800 104,766 In 2003, the Company issued a total of 2,065,402 Class B Non-Voting shares in connection with the acquisition of Cable Atlantic Inc. ("Cable Atlantic") (note 11(a)(iii)(b)). 84 2 0 0 3 Annual Report Rogers Communications Inc...

  • Page 87
    ...maturity, into 34.368 Class B Non-Voting shares. The conversion rate, as at December 31, 2003, equates to a conversion price of U.S. $27.16 per share (2002 - U.S. $26.22 per share). These Convertible Debentures are redeemable in cash, at the option of the Company, at any time. In 2003 and 2002, none...

  • Page 88
    ... $333.2 million Senior Secured Debentures mature on June 1, 2008. These debentures are redeemable, in whole or in part, at Wireless' option, at any time on or after June 1, 2003, at 104.688% of the principal amount, declining ratably to 100% of the principal amount on or after June 1, 2006, plus, in...

  • Page 89
    ... U.S. $74.8 million Senior Secured Second Priority Debentures were redeemed on June 26, 2003 at a redemption price of 105.00% of the aggregate principal amount. During 2002, Cable repurchased U.S. $36.0 million of these debentures (note 10(e)). Rogers Communications Inc. 2 0 0 3 Annual Report 87

  • Page 90
    ...general corporate purposes. Media's bank credit facility is available on a fully revolving basis until maturity on September 30, 2006 and there are no scheduled reductions prior to maturity. The interest rates charged on this credit facility range from the bank prime rate or U.S. base rate plus 0.25...

  • Page 91
    .... In addition, the repayment dates of certain debt agreements may be accelerated if there is a change in control of the respective companies. At December 31, 2003, the Company is in compliance with all terms of the long-term debt agreements. Rogers Communications Inc. 2 0 0 3 Annual Report 89

  • Page 92
    ...,646 Class B Non-Voting shares (2002 - 158,784,358) 72,313 287,978 360,291 732,078 Deduct: Amounts receivable from employees under certain share purchase plans Preferred shares of the Company held by subsidiary companies 1,186 370,000 371,186 Total capital stock Convertible Preferred Securities...

  • Page 93
    ... Voting shares of Wireless; (g) The 5,333,333 warrants issued in 1999 expired in 2002. The carrying value of these warrants, being $24.0 million, was transferred to contributed surplus; and (h) 339,100 Class B Non-Voting shares were issued to employees pursuant to the employee share purchase plan...

  • Page 94
    ... Preferred Securities could have been settled, in whole or in part, at the Company's option, with Class B Non-Voting shares, the number of which was based on the daily average trading prices of the Class B Non-Voting shares. Interest of approximately $216.9 million to June 30, 2003 was prepaid, with...

  • Page 95
    ...' attention on the long-term interest of Wireless and its shareholders. Under the plan, options to purchase Class B Restricted Voting shares of Wireless may be granted to employees, directors and officers of Wireless by the Board of Directors or by Wireless' Management Compensation Committee. There...

  • Page 96
    ... 5 years 5 years (ii) Employee share purchase plan: The employee share purchase plan was provided to enable employees of the Company an opportunity to obtain an equity interest in the Company by permitting them to acquire Class B Non-Voting shares. A total of 1,180,000 Class B NonVoting shares were...

  • Page 97
    ... Exchange on the trading day immediately prior to the purchase date or the closing price on a date that is approximately one year subsequent to the original issue date. During 2003, no Class B Non-Voting shares (2002 - 339,100) were issued under the Company's employee share purchase plan (cash in...

  • Page 98
    ... of prior years' income taxes Non-deductible portion of losses from investments accounted for by the equity method Other non-taxable amounts Non-taxable portion of gain on disposition of AT&T Canada Deposit Receipts Non-deductible portion of write-down of investments Large Corporations Tax Income...

  • Page 99
    ... most of its employees. The plans provide pensions based on years of service, years of contributions and earnings. The Company does not provide any non-pension post-retirement benefits. Actuarial estimates are based on projections of employees' compensation levels at the time of retirement. Maximum...

  • Page 100
    ... fixed income and equity securities, valued at market value. The following information is provided on pension fund assets: 2003 2002 Plan assets, beginning of year Actual return (loss) on plan assets Contributions by employees Benefits paid Plan assets, end of year Accrued benefit obligations are...

  • Page 101
    ... operating segments are substantially in Canada. Information by operating segment for the years ended December 31, 2003 and 2002 are as follows: 2003 Corporate items and eliminations Wireless Cable Media Consolidated total Operating revenue Cost of sales Sales and marketing expenses Operating...

  • Page 102
    ... data) Prepaid One-way messaging Equipment sales $ 1,920,993 91,255 27,565 242,390 2,282,203 $ 1,632,874 91,151 35,238 206,664 1,965,927 1,095,736 242,635 262,995 (4,965) 1,596,401 422,627 121,094 202,219 64,865 810,805 (50,088) $ 4,323,045 Cable: Cable Internet Video store operations Corporate...

  • Page 103
    ... are directors of the Company and/or its subsidiary companies. During 2003, total amounts paid by the Company to these related parties for legal services, commissions paid on premiums for insurance coverage and other services aggregated $6.1 million (2002 - $7.0 million), for interest charges of...

  • Page 104
    ...a cable industry fund designed to foster the production of Canadian television programming. Contributions to the CTF are based on a formula, including gross broadcast revenues and the number of subscribers. The Company may elect to spend a portion of the above amount for local television programming...

  • Page 105
    ... on the consolidated shareholders' equity of the Company is as follows: 2003 2002 Shareholders' equity based on Canadian GAAP Gain on sale and issuance of subsidiary shares to non-controlling interest (a) Gain on sale of cable systems (b) Pre-operating costs (c) Equity instruments (d) Capitalized...

  • Page 106
    ... 2002, under United States GAAP, the Company has recorded the change in the fair values of the cross-currency interest rate exchange agreements since January 1, 2001 and the amortization of the adjustment to its long-term debt, as discussed above. 104 2 0 0 3 Annual Report Rogers Communications Inc.

  • Page 107
    .... Accrued liabilities included in accounts payable and accrued liabilities as at December 31, 2003 were $1,072.7 million (2002 - $850.2 million). At December 31, 2003 and 2002, accrued liabilities in respect of PP&E totalled $90.3 million (2002 - Rogers Communications Inc. 2 0 0 3 Annual Report 105

  • Page 108
    ... a multi-year agreement with Yahoo! Inc. ("Yahoo") to provide co-branded Internet services to current and future customers of Cable's high speed residential Internet access services. In return for payment by the Company of a monthly fee, Yahoo will assume operation of Cable's e-mail service and...

  • Page 109
    ...D. Day, CA Vice President, Corporate Development Kenneth G. Engelhart Vice President, Regulatory Gregory J. Henderson, CA Vice President, Group Controller Jan L. Innes Vice President, Communications Roger D. Keay Vice President, Technology Bruce M. Mann, CPA Vice President, Investor Relations Graeme...

  • Page 110
    ...annual meeting of the shareholders of Rogers Communications Inc. will be held at 10:00 a.m. (EDT) Thursday, May 27, 2004, at the Velma Rogers Graham Theatre, Rogers Communications Inc., 333 Bloor Street East, Toronto, ON. SHARE INFORMATION Listed in Canada on the Toronto Stock Exchange (TSX): Class...

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    choice value convenience

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    Your world, right now www.rogers.com