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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Year ended December 31, 2012 Wireless Cable
Business
Solutions Media
Corporate
items and
eliminations
Consolidated
totals
Operating revenue $ 7,280 $ 3,358 $ 351 $ 1,620 $ (123) $ 12,486
Operating costs 14,217 1,753 262 1,430 (10) 7,652
Adjusted operating profit 3,063 1,605 89 190 (113) 4,834
Restructuring, acquisition and other expenses 92
Stock-based compensation expense 177
Depreciation and amortization 1,819
Impairment of assets 80
Operating income 2,766
Finance costs (671)
Other income 250
Income before income taxes $ 2,345
Additions to property, plant and equipment $ 1,123 $ 832 $ 61 $ 55 $ 71 $ 2,142
Goodwill $ 1,146 $ 1,000 $ 215 $ 854 $ – $ 3,215
Total assets $ 9,769 $ 4,719 $ 835 $ 2,157 $ 2,138 $ 19,618
1Included in operating costs on the consolidated statements of income.
Revenue by Product
2013 2012
Wireless:
Postpaid $ 6,470 $ 6,402
Prepaid 278 317
Network revenue 6,748 6,719
Equipment sales 522 561
Total Wireless 7,270 7,280
Cable:
Television 1,809 1,868
Internet 1,159 998
Cable telephony 498 477
Service revenue 3,466 3,343
Equipment sales 915
Total Cable 3,475 3,358
Business Solutions:
Next generation 213 162
Legacy 149 183
Service revenue 362 345
Equipment sales 12 6
Total Business Solutions 374 351
Media:
Advertising 762 784
Subscription 316 264
Retail 305 276
Other 321 296
Total Media 1,704 1,620
Corporate items and intercompany eliminations (117) (123)
$ 12,706 $ 12,486
NOTE 4: OPERATING COSTS
2013 2012
Cost of equipment sales and direct channel subsidies $ 1,541 $ 1,605
Merchandise for resale 190 173
Other external purchases 4,126 4,138
Employee salaries and benefits and stock-based
compensation 1,940 1,813
$ 7,797 $ 7,729
NOTE 5: FINANCE COSTS
2013 2012
Interest on long-term debt $ 734 $ 691
Interest on pension liability 14 7
Foreign exchange loss (gain) 23 (9)
Change in fair value of derivative instruments (16) 1
Capitalized interest (25) (28)
Other 12 9
$ 742 $ 671
NOTE 6: DISCONTINUED OPERATIONS
2012
Operating revenue $ 18
Operating costs (30)
Restructuring, acquisition and other expenses (30)
Loss before income taxes (42)
Income tax recovery 10
Loss from discontinued operations for the year $ (32)
We discontinued our Video segment in the second quarter of 2012 and
reported the Video results of operations as discontinued operations at
that time.
As of June 2012, Rogers’ stores no longer offered video and game
rentals or sales at its retail locations. Certain of these stores continue to
serve customers’ wireless and cable needs.
The Video segment did not have any results from discontinued
operations in 2013 or any significant assets or liabilities as at
December 31, 2013 and 2012. Cash flows from operating activities for
the segment for 2013 were nil (2012 – $2 million). The Video segment
did not have any cash flows from investing or financing activities for the
years ended December 31, 2013 and 2012.
2013 ANNUAL REPORT ROGERS COMMUNICATIONS INC. 103