Rogers 2009 Annual Report Download - page 94

Download and view the complete annual report

Please find page 94 of the 2009 Rogers annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 130

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130

98 ROGERS COMMUNICATIONS INC. 2009 ANNUAL REPORT
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The Company has contributed certain assets to joint ventures
involved in the provision of wireless broadband Internet service and
in certain mobile commerce initiatives. As at December 31, 2009 and
2008 and for the years then ended, proportionately consolidating
these joint ventures resulted in the following increases (decreases)
in the accounts of the Company:
During 2009, the Company incurred $87 million (2008 – $38 million)
of restructuring expenses related to severances resulting from the
targeted restructuring of its employee base to combine the Cable
and Wireless businesses into a communications organization and
to improve the Company’s cost structure in light of the current
economic and competitive conditions, which related to Media in
2009 and to Cable, Wireless and Media in 2008.
During 2009, the Company incurred $23 million (2008 – nil) of
restructuring expenses resulting from the outsourcing of certain
information technology functions.
During 2009, the Company incurred $2 million (2008 – $8 million)
of integration expenses related to the integration of previously
acquired businesses and related restructuring.
During 2009, the Company incurred $1 million (2008 – $1 million)
of restructuring expenses related to RBS, which is related to
severances resulting from staff reductions to reflect a reduction
in customer acquisition efforts related to enterprise and larger
business segments.
During 2009, the Company incurred $4 million (2008 – $4 million)
related to the closure of 20 (2008 – 18) underperforming retail store
locations, primarily located in the province of Ontario.
The additions to the liabilities related to the severances and
payments made against such liabilities during 2009 are as follows:
In 2009, the Company completed the purchase of spectrum and
broadcast licences from Look Communications Inc. (“Look”)
(through the Company’s joint venture with Bell Canada, Inukshuk
Wireless Partnership (“Inukshuk”)). Under the agreement, Inukshuk
paid $80 million for Look’s 92 MHz of spectrum in the provinces of
Ontario and Quebec. The Company recorded an increase in spectrum
licences of $40 million (note 11(c)) related to its proportionate share
of the purchase.
In 2007, the Company contributed its 2.3 GHz and 3.5 GHz spectrum
licences with a carrying value of $11 million to a 50% owned joint
venture for non-cash consideration of $58 million. A deferred gain
of $24 million, being the portion of the excess of fair value over
carrying value related to the other non-related venturer’s interest
in the spectrum licences contributed by the Company, was recorded
on contribution of these spectrum licences. This deferred gain is
recorded in other long-term liabilities and is being amortized to
income on a straight-line basis over seven years, of which $4 million
was recognized in 2009 (2008 – $4 million). In addition to a cash
contribution of $8 million, the other venturer also contributed its 2.3
GHz and 3.5 GHz spectrum licences valued at $50 million to the joint
venture. The Company recorded an increase in spectrum licences
and cash of $25 million and $4 million, respectively, related to its
proportionate share of the contribution by the other venturer.
5. INVESTMENT IN JOINT VENTURES:
6. INTEGRATION AND RESTRUCTURING EXPENSES:
2009 2008
Current assets $ – $ 7
Long-term assets 103 68
Current liabilities 16 4
Revenue ––
Expenses 32 29
Net loss for the year (32) (29)
As at
December 31,
2008 Additions Payments
As at
December 31,
2009
2008 severances to improve Company’s cost structure $ 35 $ – $ (27) $ 8
2009 severances to improve Company’s cost structure in Media and combine
Cable and Wireless ongoing activities –87 (14) 73
Severances related to RBS restructuring costs 2 1 (1) 2
Outsourcing of certain information technology functions –23 (14) 9
Retail store closures 1 4 (3) 2
Integration of previously acquired businesses – 2 – 2
$ 38 $ 117 $ (59) $ 96
The remaining liability, which is included in accounts payable and accrued liabilities as at December 31, 2009, will be paid over the course
of 2010 and 2011.