CRTC releases 2012 financial results for Canada's cable and satellite companies

OTTAWA-GATINEAU — Today, the Canadian Radio-television and Telecommunications Commission (CRTC) released statistical and financial information on Canadian broadcasting distribution companies for the broadcast year ended August 31, 2012.
During the past year, cable companies reported a modest growth in revenues and subscribers, while satellite companies recorded a decline in both categories. The combined revenues for these companies increased by 4.2%, from $13.5 billion in 2011 to $14.1 billion in 2012. Similarly, the total number of subscribers rose by 1% from 11.4 million to 11.5 million.

Cable companies

Cable companies reported revenues of $11.6 billion in 2012, which were drawn from basic and non-basic television services as well as Internet access and telephone services. This represented an increase of 5.7% over the previous year’s total revenues of $11 billion. Operating expenses were 5.8% higher during the same period, rising from $6.1 billion to $6.5 billion. Profits before interest and taxes (PBIT) remained virtually the same coming in at $2.6 billion, while the PBIT margin declined slightly from 23.1% to 22.2%.

Canadian households subscribing to a cable company’s basic television service increased by 2% to reach 8.7 million.

In 2012, cable companies increased hiring by 4.8%, raising employment figures from 25,291 to 26,502 people. As a result, total employee salaries jumped by 9.9%, from $2 billion to $2.2 billion.

Satellite companies

Following successive years of steady growth, revenues for satellite companies decreased by 2%, or from $2.55 billion in 2011 to $2.5 billion in 2012.
Operating expenses also declined from $1.9 billion to $1.7 billion. As a result, these companies experienced an increase in PBIT, going from $175.7 million in 2011 to $389.2 million in 2012. This contributed to a PBIT margin of 15.6%, which was more than double last year’s margin of 6.9%.

Canadian households subscribing to a satellite company’s basic television service decreased by 1.8% to reach 2.8 million.

These companies employed 2,098 people and paid $188.9 million in salaries, both of which were lower than the previous year. In 2011, they had 2,478 employees and paid $222.1 million in salaries.

Subscribers

                  2008       2009  Var %       2010  Var %       2011  Var %       2012  Var %  CAGR (%)
             ---------  ---------  -----  ---------  -----  ---------  -----  ---------  -----  --------
Cable        7,916,752  8,094,058   2.24  8,293,963   2.47  8,515,805   2.67  8,685,001   1.99       2.3
Satellite    2,699,510  2,760,852   2.27  2,862,076   3.67  2,877,423   0.54  2,825,677  -1.80       1.2

Contributions to Canadian programming

In 2012, broadcasting distribution companies directed $506.2 million of revenues collected from subscribers of basic and non-basic television services to the creation of Canadian programming. This was an increase of 2.4% over the previous year. Of the total amount, $208.5 million was directed to the Canada Media Fund, $62 million to independent funds, $112 million to the Local Programming Improvement Fund and $123.7 million to cable community channels and other sources of local expression.

Affiliation payments

In 2012, cable companies paid $2.3 billion in wholesale fees to the pay and specialty services they distribute, an increase of 6% over the $2.1 billion paid the previous year. The fees paid by satellite companies declined by 11.7% in one year, going from $920 million to $812 million.