Shaw 2015 Annual Report Download - page 50

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Shaw Communications Inc.
Management’s Discussion and Analysis
August 31, 2015
Financing activities
The changes in financing activities during 2015 and 2014 were as follows:
(millions of Canadian dollars) 2015 2014
Bank loans – net borrowings 361 -
ViaWest’s credit facilities (net) and finance lease obligations 52 -
Issuance of 4.35% senior unsecured notes –500
Issuance of floating rate senior unsecured notes –300
Redeem 6.5% senior unsecured notes –(600)
Repay 7.5% senior unsecured notes –(350)
Bank facility arrangement costs (14) –
Repay promissory note –(48)
Prepay Partnership mortgage –(19)
Partnership mortgage loan proceeds –40
Senior notes issuance costs –(4)
Debt retirement costs –(7)
Dividends (382) (352)
Issuance of Class B Non-Voting Shares 129 70
Distributions paid to non-controlling interests (22) (26)
124 (496)
LIQUIDITY AND CAPITAL RESOURCES
In the current year, the Company generated $653 million of free cash flow. Shaw used its free cash flow along with cash of
$239 million, borrowings of $361 million under its credit facility, proceeds on issuance of Class B Non-Voting Shares of $129
million, net proceeds of $99 million in respect of the sale of the wireless spectrum licenses, the net increase in borrowings of
$56 million under the ViaWest facilities, cash distributions from a venture capital fund and proceeds from sale of investments
of $29 million and other net items of $19 million to finance the $893 million acquisition of ViaWest, pay common share
dividends of $369 million, fund $150 million of accelerated capital spend, make $125 million in financial investments and
pay $48 million of restructuring costs.
On March 30, 2015, the Company announced that a syndicate of lenders provided a term loan in the amount of US$395
million and a revolving credit facility of US$85 million for ViaWest. The facilities were used to repay the outstanding amounts
under ViaWest’s prior credit facility and for ViaWest’s general corporate purposes. The term loan matures in March 2022 while
the revolving credit facility matures in March 2020.
On December 22, 2014, the Company announced that it amended the terms of its $1 billion bank credit facility to extend the
maturity date from January 2017 to December 2019. The facility is used for general corporate purposes.
The Company’s DRIP allows holders of Class A Shares and Class B Non-Voting Shares who are residents of Canada to
automatically reinvest monthly cash dividends to acquire additional Class B Non-Voting Shares. Class B Non-Voting Shares
distributed under the Company’s DRIP are new shares issued from treasury at a 2% discount from the 5 day weighted average
market price immediately preceding the applicable dividend payment date. The DRIP has resulted in cash savings and
incremental Class B Non-Voting Shares of $166 million during fiscal 2015.
Based on available credit facilities and forecasted free cash flow, the Company expects to have sufficient liquidity to fund
operations and obligations during the upcoming fiscal year. On a longer-term basis, Shaw expects to generate free cash flow and
have borrowing capacity sufficient to finance foreseeable future business plans and refinance maturing debt.
48 Shaw Communications Inc. 2015 Annual Report