MONTREAL – Cogeco reports that revenue increased by 5.9% to $366.6 million in its first quarter of fiscal 2013, ended November 30, 2012. Operating income, before depreciation and amortization, increased by 11.6% to $156.6 million, compared to the first quarter of fiscal 2012. But profit fell to $47.1 million compared to $47.9 million for the same period of the previous fiscal year.
Cogeco attributes the decrease to the cable segment and due to an increase in income taxes, the acquisition costs related to the acquisition of Atlantic Broadband (ABB) and last year's profit from the disposition of the Portuguese subsidiary, Cabovisao.
Free cash flow also fell from $26.3 million the year before to $18.6 million this quarter. Cogeco said the decrease is due to the increase in current income tax expense, the acquisition costs related to ABB acquisition, the defined benefit pension plans contributions as well as the increase in acquisition of property, plant and equipment, partly offset by the improvement of operating income before depreciation and amortization.
In the cable segment, primary service units (PSU) grew by 15,080 in the quarter. As of November 30, 2012, the total consolidated PSU amounted to 2,478,887 of which 494,674 comes from the conclusion of the acquisition of ABB on November 30th. But the number of cable customers in Canada also dropped by 2,076 to a total of 861,039.
"Cogeco Inc. reported very good financial results for its first quarter. Our Cable segment's growth on both revenue and operating income before amortization clearly demonstrates that the combination of our customer service efforts, our marketing strategies, along with our strong cost control initiatives have produced the expected positive effects on our financial results," declared Louis Audet, President and Chief Executive Officer of Cogeco."
"As for our entrance into the American market, it is with great enthusiasm that we concluded the acquisition of ABB on November 30, 2012. ABB and Cogeco Cable have much in common thanks to the combined expertise of both our management teams; we foresee an excellent potential for growth."
"In addition, I am pleased to report that we have completed the integration of Cogeco Metromedia. As for the radio activities, the most recent surveys confirm our continuing strong leadership position in the Montreal market, as well as solid performances by most of our stations in our regional markets."
