Cogeco 2013 Annual Report Download - page 40

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Management's discussion and analysis (“MD&A”) COGECO CABLE INC. 2013 39
OPERATING RESULTS
Years ended
August 31,
2013 August 31,
2012 Change
(in thousands of dollars, except percentages) $$ %
Revenue 267,655 — —
Operating expenses 147,403 — —
Operating income before depreciation and amortization 120,252 — —
Operating margin 44.9% —
Fiscal 2013 revenue reached $267.7 million mainly as a result of (i) an increase in HSI revenue from continued marketing focus for this service
offering driving HSI customer growth; (ii) an increase in Telephony revenue and an increase in commercial revenue as Atlantic Broadband continues
to expand its non-residential customer base through targeted marketing efforts. Fiscal 2013 operating expenses amounted to $147.4 million and
operating income before depreciation and amortization reached $120.3 million; and consequently, operating margin stood at 44.9%. Atlantic
Broadband's operating results are in line with management's expectations.
ENTERPRISE SERVICES
On January 31, 2013 and on April 3, 2013, the Corporation acquired 100% of the issued and outstanding shares of PEER 1 which is one of the
world’s leading web hosting providers, specializing in managed hosting, dedicated servers, cloud services and colocation. Fiscal 2013 included
seven months of operations of PEER 1.
The Enterprise services segment also include the operations of CDS.
OPERATING RESULTS
Years ended
August 31,
2013 August 31,
2012 Change
(in thousands of dollars, except percentages) $$ %
Revenue 200,158 89,831 —
Operating expenses 125,712 51,649 —
Operating income before depreciation and amortization 74,446 38,182 95.0
Operating margin 37.2% 42.5%
Revenue
For fiscal 2013, revenue amounted to $200.2 million, an increase of $110.3 million compared to fiscal 2012, primarily due to the seven months
results of PEER 1 recently acquired as well as CDS's organic growth.
Operating expenses
For fiscal 2013, operating expenses amounted to $125.7 million, an increase of $74.1 million compared to fiscal 2012, primarily due to seven
months results of PEER 1 recent acquisition as well as CDS's organic growth.
Operating income before depreciation and amortization and operating margin
Since revenue growth exceeded the increase in operating expenses, fiscal 2013 operating income before depreciation and amortization increased
by $36.3 million, or 95.0%, to reach $74.4 million compared to the prior year. Operating margin decreased to 37.2% from 42.5% for fiscal 2013
compared to fiscal 2012 as a result of lower margins business activities from PEER 1.