Cogeco Inc. · TSX:CGO
Cogeco — Q4 2024 Earnings Presentation
30 slides from Cogeco's earnings presentation, Oct 31, 2024
Slide 1: Investor Update
Investor Update As of October 31, 2024
Slide 2: Contents
Contents Cogeco Communications (TSX: CCA) 4 Cogeco Connexion 14 Breezeline 19 Supplementary Information 23 Cogeco (TSX: CGO) 25 Appendix 28 Subscriber Profile 29 Free Cash Flow Reconciliation 30 2
Slide 3: Forward-Looking Statements and Presentation of Financial Information
Investor Update Forward-Looking Statements and Presentation of Financial Information Forward-looking statements Presentation of financial information Certain statements contained in this presentation may constitute forward-looking information within the This presentation also includes non-IFRS Accou
Slide 4: Cogeco Communications TSX: CCA
Cogeco Communications TSX: CCA 4
Slide 5: Cogeco Communications Overview: Investment Highlights
Cogeco Communications Overview Investment Highlights North American leader in the telecommunications sector • Fibre-powered network delivers high-speed Internet, video and wireline phone services to 1.6M residential and business subscribers • Differentiated by speed, reliability, innovation, custome
Slide 6: Strong History of Returning Capital to Shareholders
Cogeco Communications Overview Strong History of Returning Capital to Shareholders Shareholder returns enhanced through return of capital to complement growth investments Dividends per Share(1) $4.00 F2024 $3.69 $3.50 $3.42 Dividend payout ratioviii 30% $3.10 $3.00 Dividend payout ratioviii $2.82 24
Slide 7: Leveraging a North American Platform
Cogeco Communications Overview Leveraging a North American Platform High-quality product offering Revenue Internet Service Subscribers • Internet packages of 1 Gbps for $M As of August 31, 2024 residential customers and 10 Gbps 000’s for commercial customers Canada U.S. Canada • Fibre-to-the-home in
Slide 8: Transformation: Delivering Sustainable Growth & Value for Shareholders
Cogeco Communications Overview Transformation: Delivering Sustainable Growth & Value for Shareholders Breezeline and Cogeco Connexion now managed as one unified North American organization • Nimbler structure positions the company on a sustainable and value creating growth trajectory • Increases fle
Slide 9: Expanding Addressable Market
Cogeco Communications Overview Expanding Addressable Market Wireless Network Evolution & Expansion • Recent launch of wireless services in the U.S. and the • Fibre-to-the-home expansions in Canada and the announcement of strategic wireless network and technical U.S. resulting in the addition of more
Slide 10: Attractive Margins & Profitability
Cogeco Communications Overview Attractive Margins & Profitability Impressive adjusted EBITDA margins due to span of operations, stable business model and operational efficiency Adjusted EBITDAi Profit $M $M (except per share) Consolidated Profit attributable to owners of Cogeco Communications Consol
Slide 11: Significant Free Cash Flow Generation
Cogeco Communications Overview Significant Free Cash Flow Generation Strong cash flow generation has enabled growth investments and return of capital to investors Free Cash Flowii Cash flows from operating activities $M $M 613(1) 1,240 585(1) 591(1) 1,175 137(2) 1,019 489 157(2) 464 173(2) 963 918 4
Slide 12: Solid Debt Profile
Cogeco Communications Overview Solid Debt Profile Strong Financial Position As of August 31, 2024 • Net indebtedness to adjusted EBITDA ratiovi of 3.3x • Available liquidityvii of $816M Cogeco Communications: Senior Secured Debt Rating • Cash and cash equivalents of $76M BBB- Q4 F2024 Debt Statistic
Slide 13: F2025 Financial Guidelines
Cogeco Communications Overview F2025 Financial Guidelines In millions of Canadian dollars, except % Fiscal Fiscal 2025 2024 Projections Actual (constant currency)iv(1) Revenue 2,977 Stable Adjusted EBITDAi 1,442 Stable Net capital expendituresiii 638 $650 to $725 Net capital expenditures in connecti
Slide 14: Cogeco Connexion
(C; coceco CONNEXION
Slide 15: Cogeco Connexion's Broadband Network
Cogeco Connexion Cogeco Connexion’s Broadband Network Serving 600+ communities from Windsor to Gaspé Through its digital oxio brand, operates in majority of Canadian provinces 15
Slide 16: Cogeco Connexion Highlights
Cogeco Connexion Highlights Strong Financial Profile Growth Opportunity • Strong adjusted EBITDAi and margini with • Fibre-to-the-home expansion projects, including solid cash flow generation those in collaboration with governments, are bringing our high-speed Internet services to • Historic full-ye
Slide 17: Cogeco Connexion Financial Results Overview
Cogeco Connexion Financial Results Overview • Strong growth and industry leading adjusted EBITDA margini • Capital invested into acquisitions and fibre-to-the-home network expansion to drive future growth Adj. EBITDAi & Adj. EBITDA Net CapExiii & Capital Revenue Margini Intensityv $M $M $M Increase
Slide 18: Wireless Spectrum Coverage to Enable MVNO Framework
Cogeco Connexion Wireless Spectrum Coverage to Enable MVNO Framework 100% broadband footprint covered by wireless spectrum for launch of MVNO wireless services 92% share of spectrum powered by 5G-optimized 3500 & 3800 MHz $588 million in spectrum acquired to date 18
Slide 19: Breezeline
a breezeline™ «a Cogeco company
Slide 20: Breezeline's Broadband Network
Breezeline Breezeline’s Broadband Network Serving 500+ communities in 13 states in the U.S. 20
Slide 21: Breezeline Highlights
Breezeline Highlights Strong Financial Profile Growth Opportunity • Strong adjusted EBITDA margini with solid free • Extending fibre services into Maryland, cash flowii generation Massachusetts, New Hampshire, Virginia and West • Growing revenue per user as our Internet-led strategy Virginia communi
Slide 22: Breezeline Financial Results Overview
Breezeline Financial Results Overview Internet-led strategy and fibre-to-the-home network expansion are contributing to revenue per user growth and a higher EBITDA margin product mix Adj. EBITDAi & Net CapExiii & Revenue Adj. EBITDA Margini Capital Intensityv $M of US dollars $M of US dollars $M of
Slide 23: Supplementary Information
Supplementary Information 23
Slide 24: Low Cost of Capital & Spread-Out Maturities
Financial Overview – Cogeco Communications Low Cost of Capital & Spread-Out Maturities Debt Maturities Excluding credit facilities and lease liabilities As at August 31, 2024 $M Net Debt to August 31, Cogeco Communications Breezeline Adjusted EBITDAvi 2024 (excluding Breezeline) U.S. subsidiaries(4)
Slide 25: Cogeco TSX: CGO
Cogeco TSX: CGO 25
Slide 26: Investment Structure
Cogeco Overview Investment Structure Cogeco TSX: CGO 12.0M shares of CCA(1) 80% Voting Rights $584M 100% Voting Rights 28% Equity Market 100% Equity Capitalization(1) 6.1% Dividend Yield(2) Investment in Cogeco Cogeco Media Communications RADIO BROADCASTING TSX: CCA $843M $97M (1)(3) Investment Valu
Slide 27: Cogeco Media: Strong Network of Radio Stations
Cogeco Overview Cogeco Media: Strong Network of Radio Stations Radio broadcasting network and news agency STATIONS THAT ARE RANKED AMONGST THE BEST 21 RADIO STATIONS LARGEST INDEPENDENT 4.7 MILLION INTEGRATED SALES RADIO NEWS SERVICE LISTENERS / WEEK SERVICES IN QUÉBEC IN QUÉBEC 27
Slide 28: Appendix
APPENDIX 28
Slide 29: Subscriber Profile
Cogeco Communications Subscriber Profile August 31, 2024 COGECO CONNEXION BREEZELINE TOTAL Homes passed(1)(2) 2,098,262 1,765,375 3,863,637 Primary service units(2)(3) 1,869,963 1,029,995 2,899,958 Internet service subscribers(2)(4) 892,699 643,599 1,536,298 Video service subscribers(2) 604,824 261,
Slide 30: Free Cash Flow Reconciliation
Cogeco Communications Free Cash Flow Reconciliation Free cash flow reconciliation (For F2022, F2023 & F2024 reconciliations, please refer to the F2024 Annual Report) Fiscal 2021 Fiscal 2020 (In thousands of Canadian dollars) $ $ Cash flows from operating activities 1,019,059 917,819 Changes in other