Rogers 2004 Annual Report Download - page 44

42 Rogers Communications Inc. 2004 Annual Report
TV channels, Rogers Sportsnet (in December 2004, Broadcasting acquired the remaining 20% interest in Rogers Sportsnet from Fox
Sports Net Canada Holdings LLC (“Fox”), thereby taking its ownership interest to 100%), and its 50% ownership of Dome Productions.
The Shopping Channel is Media’s televised home-shopping service.
Media’s revenues primarily consist of:
• Advertising revenues;
• Circulation and subscription revenues; and
• Retail product sales.
Media’s operating expenses consist of:
• Cost of sales, which is comprised of the cost of retail product at The Shopping Channel;
• Sales and marketing expenses; and
• Operating, general and administrative expenses, which include programming costs, production expenses, circulation expenses and
other back-office type support functions.
Summarized Media Financial Results
(In millions of dollars, except margins) 2004 2003 %Chg
Operating revenue
Publishing $ 278.6 $ 289.9 (3.9)
Radio 204.7 177.2 15.5
Television 196.8 178.0 10.6
The Shopping Channel 230.9 210.5 9.7
Corporate items, eliminations and other (11.2) (0.6) –
Total operating revenue 899.8 855.0 5.2
Operating expenses
Cost of sales 142.4 131.5 8.3
Sales and marketing 184.9 175.7 5.2
Operating, general and administrative 451.0 441.1 2.2
Total operating expenses 778.3 748.3 4.0
Operating profit1
Publishing 23.1 29.4 (21.4)
Radio 58.0 38.7 49.9
Television 36.8 27.7 32.9
The Shopping Channel 23.4 19.2 21.9
Corporate items (19.8) (8.3) 138.6
Total operating profit1$ 121.5 $ 106.7 13.9
Operating profit margin2
Publishing 8.3% 10.1%
Radio 28.3% 21.8%
Television 18.7% 15.6%
The Shopping Channel 10.1% 9.1%
13.5% 12.5%
Additions to property, plant and equipment3$ 19.6 $ 41.3 (52.5)
1 As defined – see the “Key Performance Indicators and Non-GAAP Measures – Operating Profit and Operating Profit Margin” section.
2 As defined – see the “Key Performance Indicators and Non-GAAP Measures – Operating Profit and Operating Profit Margin” section and the “Supplementary
Information – Operating Profit Margin Calculations” section for the calculation. Operating profit margin equals operating profit divided by operating revenue.
3 As defined. See the “Key Performance Indicators and Non-GAAP Measures – Additions to PP&E” section.
Media Operating Highlights and Significant Developments in 2004
• Media’s Radio Broadcasting division was awarded three new radio licences by the CRTC for new FM stations in Halifax, Moncton and
Saint John that will, upon launch in the second half of 2005, provide comprehensive local news and information with in-depth cover-
age of local weather, traffic, sports and other community events.
• Media’s Television Broadcasting division acquired the remaining 20% interest in Rogers Sportsnet held by Fox to increase its owner-
ship in Sportsnet to 100%. The Television Broadcasting division also reached an agreement, subject to CRTC approval, to purchase the
assets of NOWTV, a Vancouver over-the-air television broadcaster, which also owns a licence for a Winnipeg television service, from
Trinity Television Inc.