Rogers 2013 Annual Report Download - page 62

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MANAGEMENT’S DISCUSSION AND ANALYSIS
Managing Our Liquidity and Financial Resources
SOURCES AND USES OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years ended December 31
(In millions of dollars) 2013 2012 %Chg
CASH FROM OPERATIONS
Net income for the period $ 1,669 $ 1,693 (1)
Depreciation and amortization 1,898 1,819 4
Impairment of assets –80 n/m
Finance costs 742 671 11
Income tax expense 596 610 (2)
Gain on sale of TVtropolis (47) – n/m
Gain on spectrum distribution –(233) n/m
Other 90 89 1
Cash provided by operations before changes in non-cash operating items 4,948 4,729 5
Change in non-cash operating working capital items 238 (248) n/m
5,186 4,481 16
Income taxes paid (496) (380) 31
Interest paid (700) (680) 3
Cash provided by operating activities 3,990 3,421 17
CASHUSED IN INVESTING
Additions to property, plant and equipment (2,240) (2,142) 5
Change in non-cash working capital items related to property, plant and equipment (114) 136 n/m
Acquisitions and strategic initiatives (1,080) (707) 53
Other (39) (121) (68)
Cash used in investing activities (3,473) (2,834) 23
CASH FROM FINANCING
Issuance of long-term debt, net of transaction costs 2,543 2,090 22
Repayment of long-term debt and net settlement of derivatives on termination (725) (1,240) (42)
Proceeds on short-term borrowings 650 – n/m
Dividends paid and repurchase/issuance of Class B Non-Voting shares (897) (1,167) (23)
Cash provided by (used in) financing activities 1,571 (317) n/m
Increase in cash and cash equivalents $ 2,088 $ 270 n/m
Cash and cash equivalents, end of period $ 2,301 $ 213 n/m
Operating Activities
Cash provided by operations was 17%higher this year compared to
2012.
The changes were the net effect of:
•a5%increase in cash from operations before changes in non-cash
operating items
• net funding provided by non-cash working capital this year
compared to a net investment in 2012
•a3%increase in interest paid on long-term debt due to an increase
in the amount of outstanding debt, partially offset by a decrease in
the weighted-average interest rate
• higher cash income tax payments in 2013.
Investing Activities
Property, Plant and Equipment
We spent $2,240 million this year, excluding $114 million of related
changes in non-cash working capital, compared to $2,142 million in
2012. See “Additions to Property, Plant and Equipment”.
Acquisitions and Strategic Initiatives
We made net investments of $1,080 million this year mainly to acquire
theScore, Blackiron, Mountain Cable and Pivot Data Centres. In 2012,
we made net investments of $707 million to acquire our 37.5%interest
in MLSE and for certain deposits related to our acquisition of theScore.
Financing Activities
Debt Issuances
On March 7, 2013 we issued US$1.0 billion of senior notes for total net
proceeds of approximately Cdn$1,015 million (US$985 million), after
deducting the original issue discount and debt issuance costs, with the
proceeds used for general corporate purposes. The notes issued
consisted of the following:
• US$500 million of 3.0%senior notes due in 2023 (the March 2023
Notes)
• US$500 million of 4.5%senior notes due in 2043 (the March 2043
Notes).
58 ROGERS COMMUNICATIONS INC. 2013 ANNUAL REPORT