Rogers 2011 Annual Report Download - page 7

knowledge, Rogers once again returned
more cash as a percentage of equity market
capitalization to shareholders than any other
telecom or cable company in Canada.
At the same time, we further strengthened
our investment grade balance sheet. We
ended the year with $2.1 billion of available
liquidity, while continuing to invest heavily in
customer retention, network enhancement
and product development initiatives.
COMPETING STRONGLY
We continued to see the consumption
of communications, information and
entertainment services converge across
networks, platforms and devices. Rogers
is best positioned to lead in a world where
distribution and content are increasingly
converging. We’re positioned to win as
digital content seamlessly traverses IP-based
wireless and broadband networks, to
be consumed in real time or on demand
across multiple devices – big screen TVs,
computers, tablets, smartphones and
gaming devices.
We continued to grow our wireless
business by maintaining our relentless
focus on driving wireless data growth
and smartphone penetration, attracting
and retaining high-value customers who
generate greater average revenue and lower
churn. We ended 2011 with more than half
of our postpaid wireless subscriber base on
smartphones. And in the fourth quarter of
2011, 37 percent of our wireless network
revenue was generated by wireless data.
At the same time, the competitive
environment continues to reflect the
combination of multiple new wireless
entrants and our two primary incumbent
wireless competitors having fully transitioned
to HSPA networks, gaining access to an
expanded array of wireless devices. While
we were successful in driving continued
strong double-digit growth in wireless data
revenues, the economics of the wireless
voice business continued to be under
pressure as intense competition asserted
influence on pricing and customer churn.
We continued to deliver growth in our
cable business, adding nearly 150,000 total
cable service units in 2011. We continued
to execute on our “TV Anywhere” vision
and leverage and further enhance the
undisputed superiority of our highly
advanced broadband cable network. Rogers
is now able to provide customers the long-
envisioned four-screen video experience
with on-demand video delivery to the home
television, PCs and tablets, smartphones,
and gaming devices. In 2012, we will further
integrate these services, expand the range
of capable devices, and continue to enhance
the digital set-top box user interface.
We were also successful in our focus on
streamlining the cost structure in our cable
business, where during 2011, the Cable
Operations segment generated strong
operating leverage and increased the
operating profit margin to almost 47%.
At the same time, we continued to improve
the margins and drive greater amounts of
on-net business in our Business Solutions
division.
Our media businesses had an exciting and
profitable year as well, with continued
momentum from new property launches,
strong ratings, and initiatives to over-index
around sports and local content, including
Rogers’ 37.5% investment in Maple Leafs
Sports and Entertainment, that is expected
to be completed in mid-2012. Media also
implemented a revamped, more integrated
Despite a great deal of change in our
dynamic industry during 2011, three things
in particular remained constant: our strategy,
our competitive advantages, and Canadians’
insatiable demand to be connected to what
matters most wherever they are. Rogers
remains solidly positioned in markets where
consumers want and continue to consume
more and more – more wireless and
broadband connectivity, more information
and entertainment, and more desire to be
connected to what matters to them most
wherever they are.
Across Rogers, there is a clear focus, not
just on sustaining our lead as the top
integrated communications and media
company in Canada, on delivering upon
our strategy of leading the enablement
and delivery of seamless, customer-driven
communications, entertainment, information
and transactional experiences across any
device, place or time.
DELIVERING RESULTS
2011 was an intensely competitive year,
as expected. Despite this backdrop, which
moderated our growth, we continued our
top-line, bottom-line and subscriber growth,
while meeting our operating profit and free
cash flow targets and delivering against our
strategic priorities.
The combination of continued sales strength
and operating discipline allowed us to
generate and return significant amounts of
cash to shareholders through a combination
of dividends and share buybacks. To our
2011 ANNUAL REPORT ROGERS COMMUNICATIONS INC. 03
“ ROGERS IS BEST POSITIONED
TO LEAD IN A WORLD WHERE
DISTRIBUTION AND CONTENT
ARE INCREASINGLY CONVERGING…”