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S
haw
C
ommunications Inc
.
MANA
G
EMENT’
S
DI
SCUSS
I
O
N AND ANALY
S
I
S
August
,
up
com
i
n
gfi
scal
y
ear.
O
n a lon
g
er-term bas
i
s,
S
haw ex
p
ects to
g
enerate
f
ree cash
f
low and have
borrowing capacity sufficient to finance foreseeable future business plans and refinanc
e
m
aturing debt.
Debt structure and
f
inancial polic
y
S
haw structures
i
ts borrow
i
n
g
s
g
enerall
y
on a stand-alone bas
i
s. The borrow
i
n
g
so
fS
haw are
u
nsecured. Wh
i
le certa
i
n non-wholly owned subs
i
d
i
ar
i
es are sub
j
ect to contractual restr
i
ct
i
ons
which may prevent the transfer of funds to Shaw, there are no similar restrictions with respect
t
o wholl
y
-owned subs
i
d
i
ar
i
es o
f
the
C
om
p
an
y.
S
haw’s borrow
i
n
g
s are sub
j
ect to covenants wh
i
ch
i
nclude ma
i
nta
i
n
i
n
g
m
i
n
i
mum or max
i
mu
m
fi
nanc
i
al rat
i
os. At August
31
,
2013
,
S
haw
i
s
i
n compl
i
ance w
i
th these covenants and based on
current business plans, the Company is not aware of any condition or event that would give ris
e
t
o non-com
p
l
i
ance w
i
th the covenants over the l
if
eo
f
the borrow
i
n
g
s. As at Au
g
ust
31
,
2013,
t
he rat
i
oo
f
debt to operat
i
ng
i
ncome be
f
ore amort
i
zat
i
on
f
or the
C
orporat
i
on
i
s
2
.
3
t
i
mes
.
H
av
i
ng regard to preva
i
l
i
ng compet
i
t
i
ve, operat
i
onal and cap
i
tal market cond
i
t
i
ons, the Board o
f
D
irectors has determined that having this ratio in the range of 2.0 to 2.5 times would be
op
t
i
mal levera
g
e
f
or the
C
or
p
orat
i
on
i
n the current env
i
ronment.
S
hould the rat
i
o
f
all below th
i
s
t
he Board may choose to recap
i
tal
i
ze back
i
nto th
i
s opt
i
mal range. The Board may also
d
etermine to increase the Corporation’s debt above these levels to finance specific strategi
c
opp
ortun
i
t
i
es such as a s
ig
n
ifi
cant ac
q
u
i
s
i
t
i
on or re
p
urchase o
fC
lass B Non-Vot
i
n
g
P
art
i
c
i
pat
i
ng
S
hares
i
n the event that pr
i
c
i
ng levels were to drop prec
i
p
i
tously
.
Off-balance sheet arran
g
ement and
g
uarantee
s
G
uarantee
s
Generall
y
it is not the Com
p
an
y
’s
p
olic
y
to issue
g
uarantees to non-controlled affiliates or third
p
art
i
es; however,
i
t has entered
i
nto certa
i
na
g
reements as more
f
ull
y
descr
i
bed
i
n Note
2
5t
o
t
he Consolidated Financial Statements. As disclosed thereto, Shaw believes it is remote tha
t
t
hese a
g
reements would re
q
uire an
y
cash
p
a
y
ment
.
C
ontractual obl
ig
at
i
on
s
The amounts of estimated future payments under the Company’s contractual obligations at
August 31, 2013 are detailed in the following table.
CO
NTRA
C
TUAL
O
BLI
G
ATI
O
N
S
P
ayments due by period
(
In
$
millions Cdn) Tota
l
W
ithi
n
1
year 2 – 3 years 4 – 5 years
More than
5
year
s
Long-term debt(1
)
8,
328 1
,
241 793 815 5
,
479
O
perat
i
ng obl
i
gat
i
ons
(2)
2
,
296
745 5
83 323 6
45
Purchase obli
g
ations
(
3)
1
62 157 2 2 1
O
ther obligations
(
4
)
53
4
85
––
10
,
839 2
,
191 1
,
383 1
,
1
4
06
,
12
5
(1) Includes principal repayments and interest payments.
54