Rogers 2015 Annual Report Download - page 127

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Issuance of senior notes
The table below provides a summary of the senior notes that we issued in 2015 and 2014.
(In millions of dollars, except interest rates and discounts)
Date Issued
Principal
amount Due date Interest rate
Discount/
premium at
issuance
Total gross
proceeds 1
(Cdn$)
Transaction costs
and discounts 2
(Cdn$)
2015 issuances
December 8, 2015 US 700 2025 3.625% 99.252% 937
December 8, 2015 US 300 2044 5.000% 101.700% 401
Total for 2015 1,338 13
2014 issuances
March 10, 2014 250 2017 Floating 100.000% 250
March 10, 2014 400 2019 2.80% 99.972% 400
March 10, 2014 600 2024 4.00% 99.706% 600
March 10, 2014 US 750 2044 5.00% 99.231% 832
Total for 2014 2,082 24
1Gross proceeds before transaction costs and discounts (see note 30).
2Transaction costs and discounts are included as deferred transaction costs and discounts in the carrying value of the long-term debt, and recognized in net income using the
effective interest method.
Concurrent with the 2015 issuances and the 2014 issuance
denominated in US dollars, we entered into debt derivatives to
convert all interest and principal payment obligations to Canadian
dollars (see note 16).
Repayment of senior notes and related derivative settlements
During 2015, we repaid our US$550 million ($702 million) and
US$280 million ($357 million) senior notes that were due in March
2015. At the same time, the associated debt derivatives were
settled at maturity for net proceeds received of $154 million,
resulting in a net repayment of $905 million including settlement of
the associated debt derivatives (see note 16).
During 2014, we repaid or repurchased our US$750 million ($834
million) and US$350 million ($387 million) senior notes that were
due in March 2014. At the same time, the associated debt
derivatives were settled at maturity for net proceeds received of
$35 million, resulting in a net repayment of $1,186 million
including settlement of the associated debt derivatives (see
note 16).
PRINCIPAL REPAYMENTS
The table below shows the principal repayments on our long-term
debt due in each of the next five years and thereafter as at
December 31, 2015.
(In millions of dollars)
2016 1,000
2017 1,250
2018 1,938
2019 900
2020 900
Thereafter 10,993
Total long-term debt 16,981
FOREIGN EXCHANGE
We recognized $11 million in 2015 (2014 – $11 million) in foreign
exchange losses in finance costs on the Consolidated Statements
of Income. These losses were entirely offset by an equivalent
amount reclassified from the hedging reserve. The offset was a
result of the debt derivatives being accounted for as effective
hedges against the foreign exchange risk related to the principal
and interest components of our US dollar-denominated debt
throughout 2015 and 2014.
TERMS AND CONDITIONS
As at December 31, 2015 and 2014, we were in compliance with all
financial covenants, financial ratios, and all of the terms and
conditions of our long-term debt agreements. There were no
financial leverage covenants in effect other than those under our
bank credit and letter of credit facilities.
The 8.75% debentures due in 2032 contain debt incurrence tests
and restrictions on additional investments, sales of assets, and
payment of dividends, all of which are suspended in the event the
public debt securities are assigned investment grade ratings by at
least two of three specified credit rating agencies. As at
December 31, 2015, these public debt securities were assigned an
investment grade rating by each of the three specified credit rating
agencies and, accordingly, these restrictions have been suspended
as long as the investment grade ratings are maintained. Our other
senior notes do not have any of these restrictions, regardless of the
related credit ratings. The repayment dates of certain debt
agreements can also be accelerated if there is a change in control
of RCI.
2015 ANNUAL REPORT ROGERS COMMUNICATIONS INC. 125