Rogers 2007 Annual Report Download - page 42

38 ROGERS COMMUNICATIONS INC. 2007 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
CABLE OPERATIONS
Summarized Financial Results
Years ended December 31,
(In millions of dollars, except margin) 2007 2006 (1) % Chg
Operating revenue
Core Cable $ 1,540 $ 1,421 8
Internet 608 523 16
Rogers Home Phone [phone]
Total Cable Operations operating revenue 2,603 2,299 13
Operating expenses before the undernoted
Sales and marketing expenses 257 219 17
Operating, general and administrative expenses 1,338 1,226 9
1,595 1,445 10
Adjusted operating profit (2) 1,008 854 18
Stock option plan amendment (3) (106) – n/m
Stock-based compensation expense (3) (10) (11) (9)
Integration expenses (4) (9) (8) 13
Contract renegotiation fee (5) (52) – n/m
Operating profit (2) $ 831 $ 835 (0)
Adjusted operating profit margin (2) 38.7% 37.1%
(1) Certain prior year amounts have been reclassified to conform with the current year presentation.
(2) As defined. See the “Key Performance Indicators and Non-GAAP Measures” and “Supplementary Information: Non-GAAP Calculations” sections.
(3) See the section entitled “Stock-based Compensation Expense”.
(4) Costs incurred relate to the integration of the operations of Call-Net.
(5) One-time charge resulting from the renegotiation of an Internet-related services agreement. See the section entitled “Cable Operations Operating Expenses”.
Summarized Subscriber Results
Years ended December 31,
(Subscriber statistics in thousands, except ARPU) 2007 2006 Chg
Cable homes passed 3,575 3,481 94
Basic Cable
Net additions 18 13 5
Total Basic Cable subscribers 2,295 2,277 18
Core Cable ARPU (1) $ 56.39 $ 52.37 $ 4.02
High-speed Internet (2)
Net additions 165 160 5
Total Internet subscribers (residential) (3) 1,465 1,297 168
Internet ARPU (1) $ 36.51 $ 35.32 $ 1.19
Digital Cable
Terminals, net additions 374 358 16
Terminals in service 1,871 1,497 374
Households, net additions 219 221 (2)
Households 1,353 1,134 219
Cable telephony subscriber lines
Net additions and migrations (4) 290 318 (28)
Total Cable telephony subscriber lines 656 366 290
Circuit-switched subscriber lines
Net losses and migrations (4) (37) (41) 4
Total circuit-switched subscriber lines (3) 334 350 (16)
Total Rogers Home Phone subscriber lines
Net additions 253 277 (24)
Total Rogers Home Phone subscriber lines (3) 990 716 274
RGUs (2)(5)
Net additions 655 671 (16)
Total revenue generating units (3) 6,103 5,424 679
(1) As defined. See the “Key Performance Indicators and Non-GAAP Measures” and “Supplementary Information: Non-GAAP Calculations” sections.
(2) Prior year high-speed Internet subscribers and RGUs have been reclassified to conform to the current year presentation.
(3) Included in total subscribers at December 31, 2007, are approximately 3,000 high-speed Internet subscribers and 21,000 circuit-switched telephony subscriber lines, representing 24,000 RGUs, acquired from
Futureway in June, 2007. These subscribers are not included in net additions for 2007.
(4) Includes approximately 42,000 and 37,000 migrations from circuit-switched to cable telephony during 2007 and 2006, respectively.
(5) RGUs are comprised of basic cable subscribers, digital cable households, residential high-speed Internet subscribers and residential cable and circuit-switched telephony subscribers.