Rogers 2006 Annual Report Download - page 51

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RO GER S CO MMU NIC AT ION S IN C . 20 0 6 ANN UA L RE POR T
MANAGEMENT’S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
DIVIDENDS AND OTHER PAYMENTS ON RCI EQUITY SECURITIES
The dividend policy is reviewed periodically by the Board. The dec-
laration and payment of dividends are at the sole discretion of the
Board and depend on, among other things, our financial condition,
general business conditions, legal restrictions regarding the pay-
ment of dividends by us, some of which are referred to below, and
other factors which the Board may, from time to time, consider to be
relevant. As a holding company with no direct operations, we rely
on cash dividends and other payments from our subsidiaries and our
own cash balances to pay dividends to our shareholders. The ability
of our subsidiaries to pay such amounts to us is limited and is subject
to the various risks as outlined in this discussion, including, without
limitation, legal and contractual restrictions contained in instruments
governing subsidiary debt. All dividend amounts have been restated
to reflect a two-for-one split of our Class B Non-voting and Class A
Voting shares in December 2006.
On February 15, 2007, we declared a quarterly dividend of $0.04 per
share on each of our outstanding Class B Non-voting and Class A
Voting shares. This quarterly dividend will be paid on April 2, 2007 to
shareholders of record on March 15, 2007.
During 2006, the Board declared dividends in aggregate of $0.0775
per share on each of its outstanding Class B Non-Voting shares, and
Class A Voting shares, $0.0375 of which were paid on July 4, 2006 to
shareholders of record on June 14, 2006, and $0.04 of which were paid
on January 2, 2007 to shareholders of record on December 20, 2006.
In October 2006, our Board of Directors (“the Board”) declared
a 113% increase to the dividend paid for each of our outstanding
Class B Non-Voting shares and Class A Voting shares. Accordingly,
the annual dividend per share increased from $0.075 per share to
$0.16 per share, on a post-split basis. In addition, the Board modi-
fied our dividend distribution policy to make dividend distributions
on a quarterly basis instead of semi-annually. The first such distri-
bution was made on January 2, 2007, to shareholders of record on
December 20, 2006.
In December 2005, the Board declared a 50% increase to the divi-
dend paid for each of our outstanding Class B Non-Voting shares
and Class A Voting shares. Accordingly, the annual dividend per
share increased from $0.05 per share to $0.075 per share, and were
paid twice yearly in the amount of $0.0375 per share to holders of
record of such shares on the record date established by the Board
for each dividend at the time such dividend was declared. These divi-
dends were scheduled to be paid on or about the first trading day
following January 1 and July 1 each year. The first such semi-annual
dividend pursuant to the policy was paid on January 6, 2006 to share-
holders of record on December 28, 2005.
During 2005, the Board declared dividends in aggregate of $0.0625 per
share on each of its outstanding Class B Non-Voting shares, and Class A
Voting shares, $0.025 of which were paid on July 2, 2005 to share-
holders of record on June 14, 2005 and $0.0375 of which were paid
on January 6, 2006 to shareholders of record on December 28, 2005.
In May 2004, the Board adopted
a dividend policy that provided
for dividends aggregating,
annually, $0.05 per share to
be paid on each outstanding
Class A Voting share and Class B
Non-Voting share. Pursuant to
this policy, the dividends were
paid twice yearly in the amount
of $0.025 per share to holders
of record of such shares on the
record date.
During 2004, the Board declared
dividends in aggregate of $0.05
per share on each of its out-
standing Class B Non-Voting
shares, Class A Voting shares
and Series E Preferred shares, $0.025 of which were paid on July 2,
2004 to shareholders of record on June 16, 2004 and $0.025 of
which were paid on January 2, 2005 to shareholders of record on
December 12, 2004.
COMMITMENTS AND OTHER CONTRACTUAL OBLIGATIONS
Contrac tual O bligations
Our material obligations under firm contractual arrangements are
summarized below at December 31, 2006. See also Notes 15, 23, and
24 to the 2006 Audited Consolidated Financial Statements.
200620052004
$0.16$0.075$0.05
ANNUALIZED DIVIDENDS
PER SHARE AT YEAR END
($)
Material Obligatio ns Under Firm Cont ractual Arrangement s
Less Than After
(In millions of dollars) 1 Year 1–3 Years 4–5 Years 5 Years Total
Long-term debt $ 450 $ – $ 2,008 $ 4,492 $ 6,950
Derivative instruments (1) 7 9 198 493 707
Mortgages and capital leases 1 1 – – 2
Operating leases 163 248 151 79 641
Player contracts 82 143 95 73 393
Purchase obligations (2) 781 957 29 30 1,797
Other long-term liabilities 2 63 18 20 103
Total $ 1,486 $ 1,421 $ 2,499 $ 5,187 $ 10,593
(1) Amounts reflect net disbursements only.
(2) Purchase obligations consist of agreements to purchase goods and services that are enforceable and legally binding and that specify all significant terms including fixed or minimum quantities to be purchased,
price provisions and timing of the transaction. In addition, we incur expenditures for other items that are volume-dependent.