Rogers Reports Fourth Quarter 2010 Financial and Operating Results

Fourth Quarter Consolidated Revenue Increases 3% to $3.2 Billion, Adjusted Net Income Per Share up 5% to $0.64;

Wireless Adds 123,000 Net New Subscribers, Activates and Upgrades a Record 635,000 Smartphones, and Accelerates Wireless Data Revenue Growth to 32%;

Cable Operations Adjusted Operating Profit Increases 16% Driving Margins to 46.1% on Continued Subscriber Growth and Cost Efficiencies;

$531 Million of Cash Returned to Rogers Shareholders in Dividends and Share Buybacks

TORONTO, Feb. 16 /CNW/ - Rogers Communications Inc. today announced its unaudited consolidated financial and operating results for the three and twelve months ended December 31, 2010.

Financial highlights are as follows(1):

 
      Three months ended December 31, Twelve months ended December 31,
(In millions of dollars, except per share amounts) 2010 2009 % Chg 2010 2009 % Chg
                 
Operating revenue   $         3,152 $         3,057                    3 $       12,186 $       11,731                    4
Operating profit               1,084             1,049                    3             4,552             4,316                    5
Net income                    327                310                    5             1,528             1,478                    3
Basic and diluted net income per share $           0.58 $           0.51                  14 $           2.65 $           2.38                  11
                  
As adjusted:              
    Operating profit   $         1,074 $         1,101                  (2) $         4,653 $         4,388                    6
    Net income                  359                370                  (3)             1,707             1,556                  10
    Basic and diluted net income per share  $           0.64  $           0.61 5  $           2.96  $           2.51 18
                                             
             
(1)     For a detailed discussion of our financial and operating metrics and results, please review the full version of our fourth quarter 2010 earnings release, our 2009 Annual MD&A and our 2009 Annual Audited Consolidated Financial Statements and Notes thereto, as well as our 2010 quarterly interim financial statements, which can be found at rogers.com and on SEDAR at sedar.com or on EDGAR at sec.gov.

"While the top line and subscriber growth rates moderated in the quarter from 2009, we held our expenditures in solid check enabling us to continue to invest at a healthy rate in customer retention, network enhancement and product development initiatives," said Nadir Mohamed, President and Chief Executive Officer of Rogers Communications Inc. "I'm pleased to report that we met or exceeded all of our key financial commitments in 2010, while further strengthening our already healthy balance sheet and returning more than $2 billion of cash to shareholders through a combination of dividends and share buybacks."

Highlights of the fourth quarter of 2010 include the following:

  • Generated consolidated quarterly revenue growth of 3%, with Wireless network revenue growth of 3%, Cable Operations revenue growth of 2%, and Media revenue growth of 9%, versus the same quarter last year. Consolidated adjusted operating profit was down 2%. While Cable Operations adjusted operating profit increased by 16%, this was offset by a 6% decline at Wireless primarily reflecting costs associated with the significant year-over-year increase in smartphone activations and a 33% decline at Media related to increased programming costs for the start-up of the Sportsnet ONE television network.

  • Wireless network revenue growth was fuelled by data revenue growth of 32% and net subscriber additions of 123,000. Wireless data revenue now comprises 31% of Wireless network revenue and was helped by the activation and upgrade of a record 635,000 additional smartphones during the quarter, of which approximately 29% were for subscribers new to Wireless. The number of new smartphone subscribers was the highest ever in a quarter. This resulted in subscribers with smartphones, who typically generate ARPU nearly twice that of voice only subscribers, representing 41% of the overall postpaid subscriber base as at December 31, 2010, up from 31% as at December 31, 2009.

  • Wireless commenced a Long Term Evolution ("LTE") wireless network technical trial in the Ottawa area. LTE is a fourth generation ("4G") wireless technology that enables network speeds of up to 150 Mbps. The trial seeks to validate how LTE technology performs across a variety of spectrum frequencies in urban, suburban and rural environments, as well as actual throughput speeds, performance quality and interoperability with our existing HSPA+ network.

  • Cable grew total service units (television, Internet and telephony subscribers) by 17,000 during the quarter, with Internet subscriber penetration now at 73% of television subscribers and residential voice-over-cable telephony penetration at 44% of television subscribers.

  • Rogers Business Solutions ("RBS") closed the acquisition of Atria Networks, one of Ontario's largest fibre-optic data services networks, in January 2011. This acquisition will augment RBS's small and medium-sized business offerings by enhancing its ability to deliver on-net data centric services within and adjacent to Cable's footprint.

  • Media closed the acquisition of BV! Media Inc., a Canadian Internet advertising network and publisher of news and information portals. Media also closed agreements to acquire two radio stations in the Edmonton, Alberta and London, Ontario markets, in January 2011.

  • We launched a dividend reinvestment plan ("DRIP"), whereby Rogers investors are able to automatically reinvest their quarterly dividends to purchase additional Rogers Class B Non-Voting common shares without paying commissions, service charges or brokerage fees.

  • We increased our ownership position in Cogeco Cable Inc. and Cogeco Inc. for investment purposes, with the acquisition of 892,250 subordinate voting shares of Cogeco Cable Inc. and 946,090 subordinate voting shares of Cogeco Inc.

  • We repurchased 10.1 million RCI Class B Non-Voting common shares for $347 million during the quarter under our $1.5 billion share buyback authorization and paid dividends on our common shares totalling $184 million.

  • For the full year 2010, free cash flow, defined as adjusted operating profit less property, plant & equipment ("PP&E") expenditures and interest on long-term debt, increased 14% to $2.1 billion. Free cash flow per share increased by 23% over full year 2009 reflecting the growth in underlying free cash flow and the accretion from share buybacks which have decreased the base of outstanding shares.

  • For the year, we repurchased 37.1 million of our Class B Non-Voting common shares for $1,312 million and paid dividends totalling $734 million, in total returning $2.0 billion in cash to shareholders in 2010.

  • We also announced today that our Board of Directors has approved a 11% increase in the annualized dividend to $1.42 per share effective immediately, and that it has approved the renewal of our normal course issuer bid ("NCIB") program for the repurchase of up to $1.5 billion of RCI shares on the open market during the next twelve months.

This summary of our fourth quarter 2010 earnings release should be read in conjunction with the full version of our fourth quarter 2010 earnings release, our 2009 Annual MD&A and our 2009 Annual Audited Consolidated Financial Statements and Notes thereto, as well as our 2010 quarterly interim financial statements and other recent securities filings available on SEDAR at www.sedar.com. As this earnings release includes forward-looking statements and assumptions, readers should carefully review the sections of this earnings release entitled "Caution Regarding Forward-Looking Statements, Risks and Assumptions".

In this earnings release, the terms "we", "us", "our", "Rogers" and "the Company" refer to Rogers Communications Inc. and our subsidiaries, which are reported in the following segments: "Wireless", "Cable", and "Media".

SUMMARIZED CONSOLIDATED FINANCIAL RESULTS (Unaudited)

           
        Three months ended December 31, Twelve months ended December 31,
(In millions of dollars, except per share amounts)     2010 2009 % Chg 2010 2009 % Chg
                   
Operating revenue                
  Wireless     $         1,784 $         1,734                    3 $         6,968 $         6,654                    5
  Cable                
      Cable Operations                     809                795                    2             3,185             3,074                    4
      RBS                     141               124                  14                560                503                  11
      Rogers Retail                       91                110                (17)                355                399                (11)
      Corporate items and eliminations                     (10)                (10)                     -                (48)                (28)                  71
                      1,031             1,019                    1             4,052             3,948                    3
  Media                    428                393                    9             1,501             1,407                    7
  Corporate items and eliminations                    (91)                (89)                    2              (335)              (278)                  21
Total                 3,152             3,057                    3           12,186           11,731                    4
                   
Adjusted operating profit (loss)                
  Wireless                    697                744                  (6)             3,167             3,042                    4
  Cable                
      Cable Operations                     373                322                  16             1,424             1,298                  10
      RBS                       12                    5                140                  40                  35                  14
      Rogers Retail                     (15)                  (2) n/m                (27)                  (9)                200
                         370                325                  14             1,437             1,324                    9
  Media                      35                  52                (33)                147                119                  24
  Corporate items and eliminations                    (28)                (20)                  40                (98)                (97)                    1
Adjusted operating profit                 1,074             1,101                  (2)             4,653             4,388                    6
Stock-based compensation (expense) recovery                      27                (29) n/m                (47)                  33 n/m
Settlement of pension obligations                         -                (30) n/m                     -                (30) n/m
Integration and restructuring expenses                    (22)                (65)                (66)                (40)              (117)                (66)
Other items, net                        5                     - n/m                (14)                     - n/m
Contract termination fees                         -                  (7) n/m                     -                (19) n/m
Adjustment for CRTC Part II fees decision                         -                  79 n/m                     -                  61 n/m
Operating profit                 1,084             1,049                    3             4,552             4,316                    5
Other income and expense, net                    757                739                    2             3,024             2,838                    7
Net income     $            327 $            310                   5 $         1,528 $         1,478                    3
                   
Basic and diluted net income per share     $           0.58 $           0.51                  14 $           2.65 $           2.38                  11
                   
As adjusted:                
    Net income     $            359 $            370                  (3) $         1,707 $         1,556                  10
    Basic and diluted net income per share     $           0.64 $           0.61                    5 $           2.96 $           2.51                  18
                   
Additions to PP&E                
  Wireless     $            346 $            266                  30 $            937 $            865                    8
  Cable                
       Cable Operations                     157                202                (22)                611                642                  (5)
       RBS                       13                  10                  30                  38                  37                    3
       Rogers Retail                         8                    5                  60                  13                  14                  (7)
                         178                217                (18)                662                693                  (4)
  Media                      17                  21                (19)                  46                  62                (26)
  Corporate                      51                  67                (24)                194                235                (17)
Total     $            592 $            571                    4 $         1,839 $         1,855                  (1)
                 

SEGMENT REVIEW

WIRELESS

Summarized Wireless Financial Results

     
        Three months ended December 31, Twelve months ended December 31,
(In millions of dollars, except margin) 2010 2009 % Chg 2010 2009 % Chg
                   
Operating revenue            
  Postpaid     $         1,574 $         1,524                    3 $         6,272 $         5,948                    5
  Prepaid                      78                  74                    5                297                297                    -
  Network revenue               1,652             1,598                    3             6,569             6,245                    5
  Equipment sales                  132                136                  (3)                399                409 (2)
Total operating revenue               1,784             1,734                    3             6,968             6,654                    5
                   
Operating expenses before the undernoted            
  Cost of equipment sales                  404                308                  31             1,225             1,059                  16
  Sales and marketing expenses                190                186                    2                628                630                     -
  Operating, general and administrative expenses                493                496                  (1)             1,948             1,923                    1
                    1,087                990                  10             3,801             3,612                    5
Adjusted operating profit                  697                744                  (6)             3,167             3,042                    4
Stock-based compensation (expense) recovery                    3                  (5) n/m                (11)                     - n/m
Settlement of pension obligations                     -                  (3) n/m                     -                  (3) n/m
Integration and restructuring expenses                  (1)                (19)                (95)                  (5)                (33)                (85)
Other items, net                        5                    - n/m                  (5)                     - n/m
Operating profit     $            704 $            717                  (2) $         3,146 $         3,006                    5
                   
Adjusted operating profit margin as % of network revenue 42.2% 46.6%   48.2% 48.7%  
                   
Additions to PP&E   $            346 $            266                  30 $            937 $            865                    8
               
               

Summarized Wireless Subscriber Results

       
    Three months ended December 31, Twelve months ended December 31,
(Subscriber statistics in thousands, except ARPU, churn and usage) 2010 2009 Chg 2010 2009 Chg
               
Postpaid            
  Gross additions 344 334 10 1,330 1,377 (47)
  Net additions 49 109 (60) 319 528 (209)
  Total postpaid retail subscribers 7,325 6,979 346 7,325 6,979 346
  Average monthly revenue per user ("ARPU") $       71.81 $       73.42 $      (1.61) $       73.12 $       73.93 $      (0.81)
  Average monthly minutes of usage 557 588 (31) 559 585 (26)
  Monthly churn 1.35% 1.08% 0.27% 1.18% 1.06% 0.12%
               
Prepaid            
  Gross additions 221 146 75 731 582 149
  Net additions 74 19 55 147 24 123
  Total prepaid retail subscribers 1,652 1,515 137 1,652 1,515 137
  ARPU $       16.09 $       16.39 $      (0.30)  $       16.10  $       16.73  $      (0.63)
  Average monthly minutes of usage 128 119 9 115 121 (6)
  Monthly churn 3.04% 2.80% 0.24% 3.18% 3.15% 0.03%
               
Total Postpaid and Prepaid            
  Gross additions 565 480 85 2,061 1,959 102
  Net additions 123 128 (5) 466 552 (86)
  Total postpaid and prepaid retail subscribers 8,977 8,494 483 8,977 8,494 483
  Monthly churn 1.66% 1.39% 0.27% 1.53% 1.44% 0.09%
               
Blended ARPU  $       61.72  $       63.23  $      (1.51) $       63.03 $       63.59 $      (0.56)
Blended average monthly minutes of usage 477 502 (25) 478 500 (22)
               

Wireless Subscribers and Network Revenue

The year-over-year decrease in total net subscriber additions for the quarter primarily reflects an increase in the level of postpaid churn associated with heightened competitive intensity, offset by increased gross additions of both postpaid and prepaid subscribers.

Included in postpaid gross additions are a record number of new smartphone subscriber sales. The increase in prepaid subscriber additions was the result of Wireless' launch of its urban zone-based unlimited voice and text 'chatr' product and also its continued offering from earlier in the summer of prepaid wireless service plans for the Apple iPad. In addition, Wireless introduced prepaid Rocket stick wireless data plans that offer the same speed and reliability as existing postpaid plans but are designed for customers seeking the convenience of prepaid online credit card activation without term contracts.

In the fourth quarter of 2010, as part of a strategic business relationship with TBayTel to extend HSPA+ service across Northern Ontario, we migrated 17,000 postpaid subscribers and 10,000 prepaid subscribers to TBayTel.

The increase in network revenue for the three months ended December 31, 2010, compared to the corresponding period of 2009, was driven predominantly by the continued growth of Wireless' postpaid subscriber base and the continued adoption of wireless data services. Year-over-year blended ARPU decreased by 2.4%, which reflects declines in roaming, long-distance, out-of-plan usage and network access fee revenues, offset by higher wireless data and feature revenues. These decreases reflect a combination of factors, including the creation over the past year of voice and data roaming value plans for frequent travelers and general competitive intensity.

For the three months ended December 31, 2010, wireless data revenue increased by approximately 32% from the corresponding period of 2009, to $506 million. This growth in wireless data revenue reflects the continued penetration and growing usage of smartphone and wireless laptop devices which are driving increased usage of e-mail, wireless Internet access, text messaging and other wireless data services. For the three months ended December 31, 2010, data revenue represented approximately 31% of total network revenue compared to approximately 24% in the corresponding period of 2009.

For the three months ended December 31, 2010, Wireless activated and upgraded approximately 635,000 smartphones, compared to approximately 400,000 smartphones in the fourth quarter of 2009. These smartphones were predominately iPhone, BlackBerry and Android devices, of which approximately 29% were for subscribers new to Wireless, during the three months ended December 31, 2010. This resulted in subscribers with smartphones representing 41% of the overall postpaid subscriber base as at December 31, 2010, compared to 31% as at December 31, 2009. These subscribers generally commit to new multi-year-term contracts, and typically generate ARPU nearly twice that of voice only subscribers. This is the largest number of smartphone activations and new smartphone customer additions that Wireless has ever reported in a quarter.

Wireless Equipment Sales

The year-over-year decrease for the three months ended December 31, 2010 in revenue from equipment sales, including activation fees and net of equipment subsidies, versus the corresponding period of 2009, reflects the higher smartphone subsidy levels, which offset the increase in the number of smartphone activations.

Wireless Operating Expenses

           
        Three months ended December 31, Twelve months ended December 31,
(In millions of dollars)   2010 2009 % Chg 2010 2009 % Chg
                     
Operating expenses              
  Cost of equipment sales   $            404 $            308                  31 $         1,225 $         1,059                  16
  Sales and marketing expenses                190                186                    2                628                630                     -
  Operating, general and administrative expenses 493 496 (1) 1,948 1,923 1
Operating expenses before the undernoted             1,087                990                  10             3,801             3,612                    5
Stock-based compensation expense (recovery)                  (3)                    5 n/m                  11                     - n/m
Settlement of pension obligations                     -                    3 n/m                     -                    3 n/m
Integration and restructuring expenses                    1                  19                (95)                    5                  33                (85)
Other items, net                      (5)                     - n/m                    5                     - n/m
Total operating expenses $         1,080 $         1,017                    6 $         3,822 $         3,648                    5

The $96 million increase in cost of equipment sales for the three months ended December 31, 2010, compared to the corresponding period of 2009, was primarily the result of an increase in hardware upgrade units versus the prior period and a continued increase in the mix of smartphones for both new and upgrading subscribers. A large number of existing iPhone and BlackBerry subscribers became eligible for hardware upgrades during the second half of 2010, which led to a 90% increase in the number of smartphone upgrades versus the corresponding period of the prior year. This was the single largest factor driving the year-over-year increase in expenses, and Wireless views these costs as net present value positive investments in the acquisition and retention of higher ARPU, lower churning customers who are on term contracts.

Sales and marketing expenses increased marginally for the three months ended December 31, 2010, compared to the corresponding period of 2009, as increased spending on advertising and promotion costs for new marketing campaigns, higher data activations, and higher dealer compensation associated with both volumes and mix, were offset by savings resulting from cost reduction initiatives.

The year-over-year decrease in operating, general and administrative expenses for the fourth quarter, excluding retention spending discussed below, was driven by the savings related to operating and scale efficiencies across various functions, offset by the growth in the Wireless subscriber base.

Total retention spending, including subsidies on handset upgrades, was $269 million in the three months ended December 31, 2010, compared to $153 million in the corresponding period of 2009. The significant increase is a result of a higher volume of upgrade activity by existing subscribers as discussed above and a higher mix of smartphones, versus the corresponding period in 2009.

Wireless Adjusted Operating Profit

The 6% year-over-year decrease in adjusted operating profit and the 42.2% adjusted operating profit margin on network revenue (which excludes equipment sales revenue) for the three months ended December 31, 2010 primarily reflect the increase in the total operating expenses discussed above, driven heavily by the record level of smartphone activations and upgrades and related level of subsidy spending, partially offset by the increase in network revenue.

Wireless Additions to PP&E

Wireless additions to PP&E are classified into the following categories: 

           
        Three months ended December 31, Twelve months ended December 31,
(In millions of dollars)   2010 2009 % Chg 2010 2009 % Chg
                   
Additions to PP&E              
  Capacity     $            146 $            149                  (2) $            446 $            498                (10)
  Quality                    103                  56                  84                284                199 43
  Network - other                    38                  14                171                  61                  39 56
  Information technology and other 59 47 26 146 129 13
Total additions to PP&E   $            346 $            266                  30 $            937 $            865 8

Wireless PP&E additions for the fourth quarter reflect spending on network capacity, such as radio channel additions, network core improvements and network enhancing features, including the continued deployment of our HSPA+ network. Quality-related additions to PP&E are associated with upgrades to the network to enable higher throughput speeds in addition to improved network access associated activities, such as site build programs and network sectorization work. Moreover, Quality includes test and monitoring equipment and operating support system activities. Investments in Network - other are associated with network reliability and renewal initiatives, infrastructure upgrades and new product platforms. Information technology and other wireless specific system initiatives include billing and back-office system upgrades, and other facilities and equipment spending. 

The increase in Wireless PP&E additions for the three months ending December 31, 2010 is largely due to Quality-related deployment of additional cell sites into the network, while the increase in Network - other spending reflects deployment of cross platform feature enablement. The increase in Information technology and other was driven primarily by an enterprise data warehouse project.

During the fourth quarter, we announced the start of technical trials of next generation LTE wireless network technology in various frequency bands in the Ottawa area to better understand and plan for LTE data throughput speeds, performance quality and the interoperability of LTE with our existing HSPA+ network.

CABLE

Summarized Cable Financial Results

           
        Three months ended December 31, Twelve months ended December 31,
(In millions of dollars, except margin) 2010 2009 % Chg 2010 2009 % Chg
                   
Operating revenue              
  Cable Operations   $            809 $            795                    2 $         3,185 $         3,074                    4
  RBS                    141                124                  14                560                503                  11
  Rogers Retail                    91                110                (17)                355                399                (11)
  Intercompany eliminations                (10)                (10)                     -                (48)                (28)                  71
Total operating revenue              1,031             1,019                    1             4,052             3,948                    3
                   
Adjusted operating profit (loss) before the undernoted            
  Cable Operations                  373               322                  16             1,424             1,298                  10
  RBS                      12                    5                140                  40                  35                  14
  Rogers Retail                  (15)                  (2) n/m                (27)                  (9)                200
Adjusted operating profit                  370                325                  14             1,437             1,324                    9
Stock-based compensation (expense) recovery                    4                  (9) n/m                  (7)                  12 n/m
Settlement of pension obligations                     -                (11) n/m                     -                (11) n/m
Integration and restructuring expenses                (10)                (29)                (66)                (23)                (46)                (50)
Other items, net                         -                     - n/m                  (5)                     - n/m
Adjustment for CRTC Part II fees decision                     -                  60 n/m                     -                  46 n/m
Operating profit     $            364 $            336                    8 $         1,402 $         1,325                    6
                   
Adjusted operating profit (loss) margin            
  Cable Operations   46.1% 40.5%   44.7% 42.2%  
  RBS     8.5% 4.0%   7.1% 7.0%  
  Rogers Retail   (16.5%) (1.8%)   (7.6%) (2.3%)  
                   
Additions to PP&E              
  Cable Operations   $            157 $            202                (22) $            611 $            642                  (5)
  RBS                      13                  10                  30                  38                  37                    3
  Rogers Retail                      8                    5                  60                  13                  14                  (7)
Total additions to PP&E   $            178 $            217                (18) $            662 $            693                  (4)

The following segment discussions provide a detailed discussion of the Cable operating results.

CABLE OPERATIONS 

Summarized Financial Results

           
        Three months ended December 31, Twelve months ended December 31,
(In millions of dollars, except margin) 2010 2009 % Chg 2010 2009 % Chg
                   
Operating revenue              
  Cable Television   $            468 $            465                    1 $         1,830 $         1,780                    3
  Internet                    217                202                    7                848                781                    9
  Rogers Home Phone                  124                128                  (3)                507                513                  (1)
Total Cable Operations operating revenue                809                795                    2             3,185             3,074                    4
                         
Operating expenses before the undernoted            
  Sales and marketing expenses                  57                  61                  (7)                222                243                  (9)
  Operating, general and administrative expenses                379                412                  (8)             1,539             1,533                     -
                       436                473                  (8)             1,761             1,776                  (1)
Adjusted operating profit                  373                322                  16             1,424             1,298                  10
Stock-based compensation (expense) recovery                    4                  (8) n/m                  (7)                  12 n/m
Settlement of pension obligations                     -                (10) n/m                     -                (10) n/m
Integration and restructuring expenses                     -                (20) n/m                  (3)                (31)                (90)
Other items, net                         -                     - n/m                  (7)                     - n/m
Adjustment for CRTC Part II fees decision                     -                  60 n/m                     -                  46 n/m
Operating profit     $            377 $            344                  10 $         1,407 $         1,315                    7
                         
Adjusted operating profit margin 46.1% 40.5%   44.7% 42.2%  
                   
                     

Summarized Subscriber Results

       
    Three months ended December 31, Twelve months ended December 31,
(Subscriber statistics in thousands) 2010 2009 Chg 2010 2009 Chg
               
Cable homes passed             3,708             3,635                  73             3,708             3,635                  73
               
Television            
  Net additions (losses)                  (4)                    3                  (7)                    4                (24)                  28
  Total television subscribers             2,305             2,296                    9             2,305             2,296                    9
               
 Digital cable            
    Households, net additions                  14                  39                (25)                  67                114                (47)
    Total digital cable households             1,733             1,664                  69             1,733             1,664                  69
               
Cable high-speed Internet            
  Net additions                  13                  22                  (9)                  64                  48                  16
  Total cable high-speed Internet subscribers             1,686             1,619                  67             1,686             1,619                  67
               
Cable telephony lines            
  Net additions and migrations                    8                  28                (20)                  66                  97                (31)
  Total cable telephony lines             1,003                937                  66             1,003                937                  66
               
Total cable service units            
  Net additions                  17                  53                (36)                134                121                  13
  Total cable service units             4,994             4,852                142             4,994             4,852                142
               
               
Circuit-switched lines            
  Net losses and migrations                  (9)                (19)                  10                (48)                (91)                  43
  Total circuit-switched lines                  46                124                (78)                  46                124                (78)
               
               

Cable Television Revenue

The increase in Cable Television revenue for the three months ended December 31, 2010, compared to the corresponding period of 2009, reflects the continuing increase in penetration of our digital cable product offerings and pricing changes. The slowdown in the year-over-year growth rate of Cable Television revenue from the third quarter to the fourth quarter of 2010 partially reflects the cumulative effect of on-going targeted bundling and retention initiatives to transition portions of the subscriber base to term contracts and a lower number of subsidized digital box sales in the quarter versus the fourth quarter of 2009.

Cable continues to lead the Canadian cable industry in digital cable penetration. The digital cable subscriber base grew by 4% and represented 75% of television households passed by our cable networks as at December 31, 2010, compared to 72% as at December 31, 2009. Increased demand from subscribers for the larger selection of digital content, video on demand, HDTV and personal video recorder ("PVR") equipment continues to contribute to the growth in the digital subscriber base and cable television revenue.

Cable Internet Revenue

The year-over-year increase in Internet revenue for the three months ended December 31, 2010 primarily reflects the increase in the Internet subscriber base, combined with Internet services price changes made in July 2010 and the timing and mix of promotional programs.

With the high-speed Internet base at approximately 1.7 million subscribers, Internet penetration is approximately 45% of the homes passed by our cable networks and 73% of our television subscriber base, as at December 31, 2010.

Rogers Home Phone Revenue

Rogers Home Phone revenue for the three months ended December 31, 2010, reflects the year-over-year growth in the cable telephony customer base with a corresponding cable telephony revenue growth of approximately 5% for the quarter, offset by the ongoing decline of the legacy circuit-switched telephony base. This decline of the legacy circuit-switched telephony base included approximately 30,000 customers which were migrated to a third-party carrier during the second half of 2010, per the sale agreement entered into in the last quarter, as discussed below. The lower net additions of cable telephony lines in the fourth quarter of 2010 versus the corresponding period of 2009 are the result of lower sales activity as campaigns were less aggressive compared to the prior year.

Cable telephony lines in service grew 7% from December 31, 2009 to December 31, 2010. At December 31, 2010, cable telephony lines represented 27% of the homes passed by our cable networks and 44% of television subscribers.

Cable continues to focus principally on growing its on-net cable telephony line base. Therefore, it continues its strategy to de-emphasize the off-net circuit-switched telephony business where services cannot be provided fully over Rogers' own network facilities. During the third quarter of 2010, Cable announced that it was divesting most of the assets related to the remaining circuit-switched telephony operations. Under this arrangement, most of its co-location sites and related equipment were sold. In addition, the sale involved residential circuit-switched lines, with the customers served by these facilities being migrated from Cable Operations to a third party reseller starting towards the end of the third quarter of 2010 and continuing over the first several months of 2011. During the second half of 2010, approximately 30,000 of these subscribers were migrated, leaving approximately 46,000 lines which will be migrated in early 2011. For the three months and twelve months ended December 31, 2010 the revenue reported by Cable Operations associated with the residential circuit-switched telephony business being divested totalled approximately $11 million and $61 million, respectively. 

Excluding the impact of the declining circuit-switched telephony business that Cable is in the process of divesting, the year-over-year revenue growth for Rogers Home Phone and Cable Operations for the three months ended December 31, 2010 would have been 5% and 3%, respectively. 

Cable Operations Operating Expenses

The decrease in Cable Operations' operating expenses for the three months ended December 31, 2010, compared to the corresponding period of 2009, was primarily due to cost reduction and efficiency initiatives across various functions. Cable Operations continues to focus on implementing a program of permanent cost reduction and efficiency improvement initiatives to control the overall growth in operating expenses.

Cable Operations Adjusted Operating Profit

The year-over-year growth in adjusted operating profit was primarily the result of the revenue growth and cost changes described above. As a result, Cable Operations' adjusted operating profit margins increased to 46.1% for the three months ended December 31, 2010, compared to 40.5% in the corresponding period of 2009.


ROGERS BUSINESS SOLUTIONS

Summarized Financial Results

           
        Three months ended December 31, Twelve months ended December 31,
(In millions of dollars, except margin) 2010 2009 % Chg 2010 2009 % Chg
                   
RBS Operating revenue   $            141 $            124                  14 $            560 $            503                  11
                   
Operating expenses before the undernoted            
  Sales and marketing expenses                    9                    7                  29                  40                  26                  54
  Operating, general and administrative expenses                120                112                    7                480                442                    9
                       129                119                    8                520                468                  11
Adjusted operating profit                    12                    5                140                  40                  35                  14
Stock-based compensation (expense) recovery                     -                  (1) n/m                     -                  (1) n/m
Integration and restructuring expenses                  (9)                  (2) n/m                (13)                  (3) n/m
Operating profit     $                3 $                2                  50 $              27 $              31                (13)
                   
Adjusted operating profit margin 8.5% 4.0%   7.1% 7.0%  
                   
                   

Summarized Subscriber Results

       
    Three months ended December 31, Twelve months ended December 31,
(Subscriber statistics in thousands) 2010 2009 Chg 2010 2009 Chg
               
Local line equivalents            
  Total local line equivalents                146                169                (23)                146                169                (23)
               
Broadband data circuits            
  Total broadband data circuits                  42                  36                    6                  42                  36                    6
               
               

RBS Revenue

The increase in RBS revenues reflects the increase in long-distance revenue, which includes higher volumes by both carrier and internal customers, and the acquisition of Blink, partially offset by the ongoing decline in the legacy portions of the business. RBS is focused on leveraging on-net revenue opportunities utilizing Cable's existing network facilities to launch on-net services while maintaining its existing medium enterprise customer base. Excluding the acquisition of Blink, revenue for the three months ended December 31, 2010 would have been increased by 10% instead of the 14% as reported, compared to the corresponding period of 2009. Further, excluding internal customers within the Rogers group of companies, revenue for the three months ended December 31, 2010 would have declined by 2%, compared to the corresponding period of 2009. For the three months ended December 31, 2010, long-distance revenue increased by $11 million, data and Internet revenue increased by $9 million, which was offset by a decline in local revenues of $3 million, compared to the corresponding period of 2009.  

RBS Operating Expenses

Sales and marketing expenses increased for the three months ended December 31, 2010, compared to the corresponding period of 2009, and reflect increased marketing within the medium and large enterprise and carrier segments associated with RBS's launch of a new suite of Ethernet services.

Operating, general and administrative expenses increased for the three months ended December 31, 2010, compared to the corresponding period of 2009. This reflects the increase in long-distance costs due to higher call volumes and country mix and the inclusion of the Blink operating costs.

RBS Adjusted Operating Profit

The year-over-year growth in adjusted operating profit was due in part to the Blink acquisition and higher revenue. As a result, RBS adjusted operating profit margins increased to 8.5% for the three months ended December 31, 2010, compared to 4.0% in the corresponding period of 2009. Excluding the acquisition of Blink, adjusted operating profit for the three months ended December 31, 2010 would have been approximately $9 million, versus $12 million as reported. RBS is focused on growing future revenue streams from on-net IP services and is incurring incremental operating costs to support that growth, and therefore offsetting the cost declines from the legacy services portion of the business.

Other RBS Developments

Subsequent to the year-end 2010, on January 4, 2011, RBS acquired Atria Networks LP ("Atria") for cash consideration of $425 million. Atria, based in Kitchener, Ontario, owns and operates one of the largest fibre-optic networks in Ontario, delivering on-net data networking services to business customers in approximately 3,700 buildings in and adjacent to Cable's service area.

ROGERS RETAIL

Summarized Financial Results 

           
        Three months ended December 31, Twelve months ended December 31,
(In millions of dollars, except margin) 2010 2009 % Chg 2010 2009 % Chg
                   
Operating revenue              
  Wireless and Cable sales   $              58 $              44                  32 $            212 $            192                  10
  Video rental and sales                    33                  66                (50)                143                207                (31)
Total Rogers Retail operating revenue                  91                110                (17)                355                399                (11)
                   
Operating expenses before the undernoted                106                112                  (5)                382                408                  (6)
Adjusted operating loss                  (15)                  (2) n/m                (27)                  (9)                200
Stock-based compensation recovery                     -                     - n/m                     -                    1 n/m
Settlement of pension obligations                     -                  (1) n/m                     -                  (1) n/m
Integration and restructuring expenses                  (1)                  (7)                (86)                  (7)                (12)                (42)
Other items, net                         -                     - n/m                    2                     - n/m
Operating loss     $            (16) $            (10)                  60 $            (32) $            (21)                  52
                   
Adjusted operating loss margin (16.5%) (1.8%)   (7.6%) (2.3%)  
                   
                   

Rogers Retail Revenue

The decrease in Rogers Retail revenue for the three months ended December 31, 2010, compared to the corresponding period of 2009, was the result of a continued decline in video rental and sales activity. This was partially offset by the continued growth in sales and services associated with Wireless and Cable customers.

Early in 2010, Rogers began an initiative to more deeply integrate its wireless, cable and video rental distribution channels to better respond to changing customer needs and preferences. As a result of this integration, certain facilities and stores associated principally with the video rental portion of Rogers Retail have been and will continue to be closed.

Rogers Retail Adjusted Operating Loss

The adjusted operating loss at Rogers Retail increased for the three months ended December 31, 2010, compared to the corresponding period of 2009, reflecting the changes and trends noted above.

Cable Additions to PP&E

Cable additions to PP&E are classified into the following categories: 

           
        Three months ended December 31, Twelve months ended December 31,
(In millions of dollars)   2010 2009 % Chg 2010 2009 % Chg
                   
Additions to PP&E              
  Customer premise equipment $              35 $              40                (13) $            234 $            185                  26
  Scalable infrastructure                    67                  91                (26)                201                259                (22)
  Line extensions                    13                  12                    8                  43                  40                    8
  Upgrades and rebuild                      6                    5                  20                  20                  20                     -
  Support capital                    36                  54                (33)                113                138                (18)
Total Cable Operations                  157                202                (22)                611                642                  (5)
RBS                      13                  10                  30                  38                  37                    3
Rogers Retail                        8                    5                  60                  13                  14                  (7)
        $            178 $            217                (18) $            662 $            693                  (4)

The Cable Operations segment categorizes its PP&E expenditures according to a standardized set of reporting categories that were developed and agreed to by the U.S. cable television industry and that facilitate comparisons of additions to PP&E between different cable companies. Under these industry definitions, Cable Operations additions to PP&E are classified into the following five categories:

  • Customer premise equipment ("CPE"), which includes the equipment for digital set-top terminals, Internet modems and associated installation costs;
  • Scalable infrastructure, which includes non-CPE costs to meet business growth and to provide service enhancements, including many of the costs to date of the cable telephony initiative;
  • Line extensions, which includes network costs to enter new service areas;
  • Upgrades and rebuild, which includes the costs to modify or replace existing coaxial cable, fibre-optic equipment and network electronics; and
  • Support capital, which includes the costs associated with the purchase, replacement or enhancement of non-network assets.

Additions to Cable PP&E include continued investments in the cable network to enhance the customer experience through increased speed and performance of our Internet service and capacity enhancements to our digital network to allow for incremental HD and On-Demand services to be added.

The decline in Cable Operations PP&E for the three months ended December 31, 2010, compared to the corresponding period of 2009 resulted primarily from lower spending on CPE and Scalable infrastructure expenditures due to the completion of certain projects associated with our Internet platform and infrastructure investments.

The changes in RBS PP&E additions for the three months ended December 31, 2010 reflect the timing of expenditures on customer networks and support capital, while the changes in Rogers Retail PP&E additions are attributable to enhancements made to certain retail locations.

MEDIA

Summarized Media Financial Results

           
        Three months ended December 31, Twelve months ended December 31,
(In millions of dollars, except margin) 2010 2009 % Chg 2010 2009 % Chg
                   
Operating revenue   $            428 $            393                    9 $         1,501 $         1,407                    7
                   
Operating expenses before the undernoted                393                341                  15             1,354             1,288                    5
Adjusted operating profit                    35                  52                (33)                147                119                  24
Stock-based compensation (expense) recovery                    3                  (5) n/m                  (9)                    8 n/m
Settlement of pension obligations                     -                (15) n/m                     -                (15) n/m
Integration and restructuring expenses                (11)                (14)                (21)                (12)                (35)                (66)
Other items, net                         -                     - n/m                  (4)                     - n/m
Contract termination fees                       -                  (7) n/m                     -                (19) n/m
Adjustment for CRTC Part II fees decision                     -                  19 n/m                     -                  15 n/m
Operating profit     $              27 $              30                (10) $            122 $              73                  67
                   
Adjusted operating profit margin 8.2% 13.2%   9.8% 8.5%  
                   
Additions to PP&E   $              17 $              21                (19) $              46 $              62                (26)
                   
                   

Media Revenue

The increase in Media's revenue for the three months ended December 31, 2010, compared to the corresponding period of 2009, reflects continuous increases in Media's prime time TV ratings, increased subscriber fees and improvements in the advertising market, which together are favourably impacting Television, Sportsnet, Publishing and Radio revenues. The Shopping Channel revenue was relatively consistent with the corresponding period of 2009, while Sports Entertainment reported revenue declines associated with fluctuations in event attendance levels and Major League Baseball revenue sharing. As Sportsnet ONE, Media's new national sports network, launched in the late part of 2010, limited revenues were realized in the three months ended December 31, 2010 but are expected to increase over the course of 2011. 

Media Operating Expenses

Media's operating expenses for the three months ended December 31, 2010 increased, compared to the corresponding period of 2009. While a focus on managing costs across all of Media's divisions over the past year has resulted in reduced operating expenses, these savings were offset by certain planned increases in programming costs at Sportsnet and Television and the costs of new content for Sportsnet ONE, which we expect to break even in the first quarter 2011 time frame. Excluding the impact of Sportsnet ONE, operating expenses for the three months ended December 31, 2010 would have grown at a rate of 7% instead of the 15% as reported, versus the corresponding period of 2009.

Media Adjusted Operating Profit

The decrease in Media's adjusted operating profit for the three months ended December 31, 2010, compared to the corresponding period of 2009, primarily reflects the revenue and expense changes discussed above. Excluding the impact of Sportsnet ONE, adjusted operating profit for the three months ended December 31, 2010 would have increased 10% compared to the corresponding period of 2009 versus the reported decline.

Media Additions to PP&E

Media's PP&E additions during the three months ended December 31, 2010 decreased from the corresponding period in 2009 due primarily to the completion of Television's new Ontario broadcasting facility in the fourth quarter of 2009.

Other Media Developments

On October 1, 2010, Media closed a transaction to acquire all the outstanding common shares of BV! Media for cash consideration of $24 million. BV! Media Inc. is a Canadian Internet advertising network and publisher of news and information portals.

On January 31, 2011, we acquired the assets of Edmonton, Alberta FM radio station BOUNCE (CHBN-FM) to strengthen our presence in this market.

On January 31, 2011, we acquired the assets of London, Ontario FM radio station BOB-FM (CHST-FM). This acquisition of BOB-FM, which is a continual ratings leader, represents our entry into the London, Ontario market.

2011 FINANCIAL AND OPERATING GUIDANCE

The following table outlines guidance ranges and assumptions for selected 2011 financial metrics. This information is forward-looking and should be read in conjunction with the section entitled "Caution Regarding Forward-Looking Statements, Risks and Assumptions" and in related disclosures, for the various economic, competitive, and regulatory assumptions and factors that could cause actual future financial and operating results to differ from those currently expected.

             
    GAAP   IFRS   IFRS
Full Year 2011 Guidance
  2010   2010   2011
(In millions of dollars)   Actual   Actual   Guidance
               
Consolidated                
    Adjusted operating profit(1)   $4,653   $4,635  
$4,600
 to
$4,765
    Additions to PP&E(2)   $1,839   $1,842  
$1,950
 to
$2,050
    After-tax free cash flow(3)   $1,993   $1,972  
$1,850
 to
$1,975
   
 
 
 
 
 

 

 
                 
    GAAP   IFRS   IFRS
Supplemental Detail(4)   2010   2010   2011
(In millions of dollars)   Actual   Actual   Guidance
Wireless                
    Network revenue   $6,569   $6,525   
$6,525
 to 
$6,725
    Adjusted operating profit(1)   $3,167   $3,158  
$3,050
to
$3,200
                 
Cable Operations                
    Revenue(5)   $3,185   $3,185  
$3,250
to
$3,325
    Adjusted operating profit(1)   $1,424   $1,426  
$1,450
to
$1,500
                 
Media                
    Revenue   $1,501   $1,461  
$1,625
to
$1,710
    Adjusted operating profit(1)   $   147   $   132  
$   160
to
$   180
                 
(1) Excludes stock-based compensation expense, integration and restructuring expenses, and other items (net).
(2) In addition to Wireless, Cable Operations and Media PP&E expenditures, consolidated additions to PP&E includes RBS, Rogers Retail and Corporate.
(3) After-tax cash flow is defined as adjusted operating profit less PP&E expenditures, interest expense and cash taxes, and is not a term defined under Canadian GAAP or IFRS. Cash taxes are expected to be approximately $90 million in 2011.
(4) This supplemental detail does not represent part of our formal 2011 guidance, and is provided for informative purposes only. Any updates over the course of 2011 would only be made to the consolidated level guidance ranges provided above.
(5) Includes cable television, residential high-speed Internet and residential telephony services; excludes RBS and Rogers Retail.

Rogers Communications Inc.
Unaudited Consolidated Statements of Income

    Three months ended   Twelve months ended
    December 31,   December 31,
(In millions of dollars, except per share amounts)   2010   2009   2010   2009
                 
Operating revenue   $                3,152   $                3,057   $              12,186   $              11,731
Operating expenses:                
    Cost of sales                        499                        397                     1,520                     1,380
    Sales and marketing                        358                        330                     1,227                     1,207
    Operating, general and administrative                     1,189                     1,186                     4,847                     4,681
    Settlement of pension obligations                             -                          30                             -                          30
    Integration and restructuring                          22                          65                          40                        117
    Depreciation and amortization                        430                        424                     1,645                     1,730
    Impairment losses on goodwill, intangible assets
     and other long-term assets
                           6                          18                            6                          18
Operating income                        648                        607                     2,901                     2,568
Interest on long-term debt                      (164)                      (173)                      (669)                      (647)
Debt issuance costs                             -                          (6)                        (10)                        (11)
Loss on repayment of long-term debt                             -                          (7)                        (87)                          (7)
Foreign exchange gain                          13                          13                          20                        136
Change in fair value of derivative instruments                        (23)                        (37)                        (16)                        (65)
Other income (expense)                          (6)                            1                          (1)                            6
Income before income taxes                        468                        398                    2,138                     1,980
Income tax expense:                
    Current                         101                        104                        322                        215
    Future                          40                        (16)                        288                        287
                          141                          88                        610                        502
                 
Net income for the period   $                   327   $                   310   $                1,528   $                1,478
                 
Net income per share:                
    Basic and diluted   $                  0.58   $                  0.51   $                  2.65   $                  2.38
                  
                 


Rogers Communications Inc.
Unaudited Consolidated Balance Sheets

        December 31,   December 31,
(In millions of dollars)     2010   2009
             
Assets            
             
Current assets          
    Cash and cash equivalents     $                               -   $                        383
    Accounts receivable                                  1,480                              1,310
    Other current assets                                     365                                 338
    Current portion of derivative instruments                                       1                                     4
    Future income tax assets                                     159                                 220
                                       2,005                              2,255
               
Property, plant and equipment                                  8,493                              8,197
Goodwill                                  3,115                              3,018
Intangible assets                                   2,669                              2,643
Investments                                     721                                 547
Derivative instruments                                         6                                   78
Other long-term assets                                     321                                 280
             
        $                      17,330   $                    17,018
             
Liabilities and Shareholders' Equity        
             
Liabilities          
Current liabilities          
    Bank advances       $                             40   $                              -
    Accounts payable and accrued liabilities                                 2,256                              2,175
    Income tax payable                                       376                                 208
    Current portion of long-term debt                                        -                                     1
    Current portion of derivative instruments                                          67                                   80
    Unearned revenue                                       274                                 284
                                         3,013                              2,748
                 
Long-term debt                                     8,718                              8,463
Derivative instruments                                       840                              1,004
Other long-term liabilities                                       124                                 133
Future income tax liabilities                                       676                                 397
                                   13,371                            12,745
             
Shareholders' equity                                   3,959                              4,273
             
        $                      17,330   $                    17,018
             

Rogers Communications Inc.
Unaudited Consolidated Statements of Cash Flows

    Three Months Ended   Twelve Months Ended
    December 31   December 31,
(In millions of dollars)   2010   2009   2010   2009
                 
Cash provided by (used in):                
Operating activities:                
  Net income for the period   $                   327   $                   310   $                1,528   $                1,478
  Adjustments to reconcile net income to net cash flows from operating activities:                
    Depreciation and amortization                        430                        424                     1,645                     1,730
    Impairment losses on goodwill, intangible assets, and other long-term assets   6   18   6   18
    Program rights and Rogers Retail rental amortization                          64   55   221                        174
    Future income taxes                          40   (16)                        288                        287
    Unrealized foreign exchange gain   (12)   (12)                        (20)                      (126)
    Loss on repayment of long-term debt                             -                            7                          87                            7
    Change in fair value of derivative instruments                          23                          37                          16                          65
    Settlement of pension obligations                             -                          30                             -                          30
    Pension contributions, net of expense   (8)   (10)                        (30)                      (102)
    Stock-based compensation expense (recovery)   (27)                          29                          47                        (33)
    Amortization of fair value increment on long-term debt                             -   (1)                          (2)                          (5)
    Other                            7   (2)                          14                            3
                       850                        869                     3,800                     3,526
  Change in non-cash operating working capital items                          107                        138                      (180)                        264
                       957                     1,007                     3,620                     3,790
               
Investing activities:                
  Additions to property, plant and equipment   (592)   (571)                   (1,839)                   (1,855)
  Change in non-cash working capital items related to property, plant and equipment   138                          36                        126                        (55)
  Acquisition of spectrum licences   (7)                             -                        (47)                        (40)
  Investment in Cogeco Inc. and Cogeco Cable Inc.   (75)   (163)                        (75)                      (163)
  Acquisitions, net of cash and cash equivalents acquired   (24)                            5                      (201)                        (11)
  Additions to program rights   (61)   (54)                      (170)                      (185)
  Other    (14)   (9)                            6                        (15)
  (635)   (756)                   (2,200)                   (2,324)
               
Financing activities:                
  Issuance of long-term debt                        460                     1,050                     2,935                     2,875
  Repayment of long-term debt                      (635)   (474)                   (2,387)                   (1,885)
  Premium on repayment of long-term debt                             -   (8)                        (79)                          (8)
  Payment on settlement of cross-currency interest rate exchange agreements and forward contracts                             -   (431)                     (816)                      (431)
  Proceeds on settlement of cross-currency interest rate exchange agreements and forward contracts                             -                        433                        547                        433
  Repurchase of Class B Non-Voting shares   (347)   (430)                   (1,312)                   (1,347)
  Issuance of capital stock on exercise of stock options                             -                            1                            3                            3
  Dividends paid    (184)   (177)                      (734)                      (704)
  (706)   (36)                   (1,843)                   (1,064)
Increase (decrease) in cash and cash equivalents   (384)                        215                      (423)                        402
               
Cash and cash equivalents (bank advances), beginning of period                        344                        168                        383                        (19)
Cash and cash equivalents (bank advances), end of period   $                   (40)   $                   383   $                  (40)   $                   383
               
Supplemental cash flow information:                
  Income taxes paid    $                       1   $                       7   $                   152   $                       8
  Interest paid                        130                        178                        651                        632
               
Cash and cash equivalents (bank advances) are defined as cash and short-term deposits which have an original maturity of less than 90 days, less bank advances. 
                
Change in Non-Cash Working Capital Items                 
                
  Three Months Ended   Twelve Months Ended
  December 31,   December 31,
(In millions of dollars)   2010   2009   2010   2009
                
Cash provided by (used in):                
Decrease (increase) in accounts receivable    $                   (74)    $                   (72)    $                 (163)    $                    93
Decrease (increase) in other assets                          41                          60                        (90)                          76
Increase (decrease) in accounts payable and accrued liabilities                          32                          40   (83)                      (155)
Increase in income taxes payable                        103                          90                        168                        205
Increase (decrease) in unearned revenue                            5                          20   (12)                        45
  $                   107   $                   138   $                 (180)   $                  264

Audited Full Year 2010 Financial Statements

In late February 2011, we intend to file with securities regulators in Canada and the U.S. our Audited Annual Consolidated Financial Statements and Notes thereto for the year ended December 31, 2010 and MD&A in respect of such annual financial statements. Notification of such filings will be made by a press release and such statements will be made available on the rogers.com, sedar.com and sec.gov websites or upon request.

Caution Regarding Forward-Looking Statements, Risks and Assumptions

This earnings release includes forward-looking statements and assumptions concerning our business, its operations and its financial performance and condition approved by management on the date of this earnings release. These forward-looking statements and assumptions include, but are not limited to, statements with respect to our objectives and strategies to achieve those objectives, statements with respect to our beliefs, plans, expectations, anticipations, estimates or intentions, including guidance and forecasts relating to revenue, adjusted operating profit, PP&E expenditures, free cash flow, dividend payments, expected growth in subscribers and the services to which they subscribe, the cost of acquiring subscribers and the deployment of new services, the currently estimated financial impacts of converting to IFRS accounting standards, and all other statements that are not historical facts. Such forward-looking statements are based on current objectives, strategies, expectations and assumptions, most of which are confidential and proprietary, that we believe to be reasonable at the time including, but not limited to, general economic and industry growth rates, currency exchange rates, product pricing levels and competitive intensity, subscriber growth and usage rates, changes in government regulation, technology deployment, device availability, the timing of new product launches, content and equipment costs, the integration of acquisitions, industry structure and stability, and current guidance from accounting standard bodies with respect to the conversion to IFRS accounting standards.

Except as otherwise indicated, this earnings release and our forward-looking statements do not reflect the potential impact of any non-recurring or other special items or of any dispositions, monetizations, mergers, acquisitions, other business combinations or other transactions that may be considered or announced or may occur after the date of the financial information contained herein.

We caution that all forward-looking information, including any statement regarding our current intentions, is inherently subject to change and uncertainty and that actual results may differ materially from the assumptions, estimates or expectations reflected in the forward-looking information. A number of factors could cause actual results to differ materially from those in the forward-looking statements or could cause our current objectives and strategies to change, including but not limited to new interpretations from accounting standards bodies, economic conditions, technological change, the integration of acquisitions, unanticipated changes in content or equipment costs, changing conditions in the entertainment, information and communications industries, regulatory changes, litigation and tax matters, the level of competitive intensity and the emergence of new opportunities, many of which are beyond our control and current expectation or knowledge. Therefore, should one or more of these risks materialize, should our objectives or strategies change, or should any other factors underlying the forward-looking statements prove incorrect, actual results and our plans may vary significantly from what we currently foresee. Accordingly, we warn investors to exercise caution when considering any such forward-looking information herein and that it would be unreasonable to rely on such statements as creating any legal rights regarding our future results or plans. We are under no obligation (and we expressly disclaim any such obligation) to update or alter any forward-looking statements or assumptions whether as a result of new information, future events or otherwise, except as required by law.

Before making any investment decisions and for a detailed discussion of the risks, uncertainties and environment associated with our business, fully review the sections entitled "Risks and Uncertainties Affecting our Businesses" and "Government Regulation and Regulatory Developments" in our 2009 Annual MD&A, as well as the sections entitled "Updates to Risks and Uncertainties" and "Government Regulation and Regulatory Developments" in our Third Quarter 2010 MD&A. Our annual and quarterly reports can be found online at rogers.com, sedar.com and sec.gov or are available directly from Rogers.

About Rogers Communications Inc.

Rogers Communications is a diversified Canadian communications and media company. We are Canada's largest provider of wireless voice and data communications services and one of Canada's leading providers of cable television, high-speed Internet and telephony services. Through Rogers Media we are engaged in radio and television broadcasting, televised shopping, magazines and trade publications, and sports entertainment. We are publicly traded on the Toronto Stock Exchange (TSX: RCI.A and RCI.B) and on the New York Stock Exchange (NYSE: RCI). For further information about the Rogers group of companies, please visit rogers.com.

Quarterly Investment Community Conference Call

As previously announced by press release, a live webcast of our quarterly results conference call with the investment community will be broadcast via the Internet at rogers.com/webcast beginning at 8:00 a.m. ET today, February 16, 2011. A rebroadcast of this teleconference will be available on the Webcast Archive page of the Investor Relations section of rogers.com for a period of at least two weeks following the conference call.

SOURCE Rogers Communications Inc.

For further information:

Investment Community Contacts

Bruce M. Mann, 416.935.3532, bruce.mann@rci.rogers.com
Dan Coombes, 416.935.3550, dan.coombes@rci.rogers.com

Media Contacts

Wireless, Cable and Corporate: Terrie Tweddle, 416.935.4727, terrie.tweddle@rci.rogers.com
Media and Regulatory: Jan Innes, 416.935.3525, jan.innes@rci.rogers.com


FORFAITS PERSONNALISÉS

Jetez un coup d’œil sur nos forfaits personnalisés ou créez le vôtre selon vos besoins de communication particuliers.

Commencez dès aujourd'hui .

ADHÉSION À CNW

Remplissez un formulaire d'adhésion à CNW ou communiquez avec nous au 1-877-269-7890.

RENSEIGNEZ-VOUS SUR LES SERVICES DE CNW

Demandez plus d'informations sur les produits et services de CNW ou communiquez avec nous au 1‑877-269-7890.