Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2018shares | |
Document and Entity Information [Abstract] | |
Entity Registrant Name | QUEBECOR MEDIA INC |
Entity Central Index Key | 0001156831 |
Document Type | 20-F |
Document Period End Date | Dec. 31, 2018 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | Yes |
Entity Current Reporting Status | No |
Entity Filer Category | Non-accelerated Filer |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 79,377,062 |
Document Fiscal Year Focus | 2018 |
Document Fiscal Period Focus | FY |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
CONSOLIDATED STATEMENTS OF INCOME | |||
Revenues | $ 4,181 | $ 4,125.1 | $ 4,057.1 |
Employee costs | 696.6 | 706.2 | 707.9 |
Purchase of goods and services | 1,752 | 1,799.7 | 1,789.9 |
Depreciation and amortization | 717.9 | 705.3 | 648.5 |
Financial expenses | 280.5 | 281.8 | 302 |
Loss on valuation and translation of financial instruments | 0.9 | 2.4 | 2.1 |
Restructuring of operations, litigation and other items | 29.8 | 17.2 | 28.5 |
Gain on sale of spectrum licences | (330.9) | ||
Impairment of goodwill and intangible assets | 43.8 | 40.9 | |
Loss on debt refinancing | 15.6 | 7.3 | |
Income before income taxes | 703.3 | 884 | 530 |
Income taxes (recovery): | |||
Current | 154.9 | 8.8 | 158 |
Deferred | 11.7 | 132.4 | (14.7) |
Income taxes | 166.6 | 141.2 | 143.3 |
Income from continuing operations | 536.7 | 742.8 | 386.7 |
Income from discontinued operations | 3.8 | 18.2 | 1 |
Net income | 540.5 | 761 | 387.7 |
Income (loss) from continuing operations attributable to | |||
Shareholders | 534.3 | 747.6 | 399.3 |
Non-controlling interests | 2.4 | (4.8) | (12.6) |
Net income (loss) attributable to | |||
Shareholders | 538.1 | 765.8 | 400.3 |
Non-controlling interests | $ 2.4 | $ (4.8) | $ (12.6) |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Income from continuing operations | $ 536.7 | $ 742.8 | $ 386.7 |
Cash flows hedges: | |||
(Loss) gain on valuation of derivative financial instruments | (10.1) | 43.7 | (30.9) |
Deferred income taxes | (5.7) | 28 | 15.9 |
Defined benefit plans: | |||
Re-measurement (loss) gain | (6.8) | (3.2) | 33.1 |
Deferred income taxes | 1.9 | 0.9 | (8.9) |
Reclassification to income: | |||
Other comprehensive income (loss) from continuing operations | (20.7) | 69.4 | 9.2 |
Comprehensive income from continuing operations | 516 | 812.2 | 395.9 |
Income from discontinued operations | 3.8 | 18.2 | 1 |
Comprehensive income | 519.8 | 830.4 | 396.9 |
Comprehensive income (loss) from continuing operations attributable to | |||
Shareholders | 513.4 | 816.7 | 405.8 |
Non-controlling interests | 2.6 | (4.5) | (9.9) |
Comprehensive income (loss) attributable to | |||
Shareholders | 517.2 | 834.9 | 406.8 |
Non-controlling interests | $ 2.6 | $ (4.5) | $ (9.9) |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - CAD ($) $ in Millions | Capital stock | Contributed surplus | Deficit | Accumulated other comprehensive loss | Equity attributable to non-controlling interests | Total |
Equity at beginning of period at Dec. 31, 2015 | $ (136) | |||||
Net income (loss) | $ 387.7 | |||||
Other comprehensive income (loss) | 6.5 | 9.2 | ||||
Equity at end of period (Previously reported) at Dec. 31, 2016 | $ 3,701.4 | $ 1.3 | $ (1,982.8) | (129.5) | $ 90.8 | 1,681.2 |
Equity at end of period (Increase (decrease) due to application of IFRS 15) at Dec. 31, 2016 | 177.3 | 177.3 | ||||
Equity at end of period at Dec. 31, 2016 | 3,701.4 | 1.3 | (1,805.5) | (129.5) | 90.8 | 1,858.5 |
Net income (loss) | 765.8 | (4.8) | 761 | |||
Other comprehensive income (loss) | 69.1 | 0.3 | 69.4 | |||
Dividends | (50) | (50) | ||||
Reduction of paid-up capital | (50) | (50) | ||||
Repurchase of shares | (20.6) | (23.3) | (43.9) | |||
Equity at end of period at Dec. 31, 2017 | 3,630.8 | 1.3 | (1,113) | (60.4) | 86.3 | 2,545 |
Net income (loss) | 538.1 | 2.4 | 540.5 | |||
Other comprehensive income (loss) | (20.9) | 0.2 | (20.7) | |||
Dividends | (100) | (0.1) | (100.1) | |||
Repurchase of shares | (611.1) | (928.9) | (1,540) | |||
Equity at end of period at Dec. 31, 2018 | $ 3,019.7 | $ 1.3 | $ (1,603.8) | $ (81.3) | $ 88.8 | $ 1,424.7 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows related to operating activities | |||
Income from continuing operations | $ 536.7 | $ 742.8 | $ 386.7 |
Adjustments for: | |||
Depreciation of property, plant and equipment | 612.4 | 601.5 | 550.6 |
Amortization of intangible assets | 105.5 | 103.8 | 97.9 |
Loss on valuation and translation of financial instruments | 0.9 | 2.4 | 2.1 |
Gain on sale of spectrum licences | (330.9) | ||
Restructuring of operations and impairment of goodwill and intangible assets | 14.9 | 43.8 | 40.9 |
Loss on debt refinancing | 15.6 | 7.3 | |
Amortization of financing costs and long-term debt discount | 6.8 | 6.9 | 7 |
Deferred income taxes | 11.7 | 132.4 | (14.7) |
Other | (5.6) | 4 | 3.7 |
Cash flows before non-cash balances | 1,283.3 | 1,322.3 | 1,081.5 |
Net change in non-cash balances related to operating activities | 136.7 | (130.1) | 53 |
Cash flows provided by continuing operating activities | 1,420 | 1,192.2 | 1,134.5 |
Cash flows related to investing activities | |||
Business acquisitions | (10.3) | (5.8) | (119.5) |
Business disposals | 3 | ||
Additions to property, plant and equipment | (552.7) | (601.8) | (654.5) |
Additions to intangible assets | (197.4) | (141.9) | (139.8) |
Proceeds from disposals of assets | 9.4 | 620.7 | 3.5 |
Loans to the parent corporation | (596.1) | ||
Acquisition of tax deductions from the parent corporation | (13.9) | (14) | |
Other | (11.3) | (10.6) | 12.7 |
Cash flows used in continuing investing activities | (1,372.3) | (139.4) | (908.6) |
Cash flows related to financing activities | |||
Net change in bank indebtedness | 24.3 | (18.9) | (14.9) |
Net change under revolving facilities | 736.5 | (209.3) | (40.3) |
Issuance of long-term debt, net of financing fees | 794.5 | ||
Repayments of long-term debt | (19.2) | (664.5) | (19) |
Settlement of hedging contracts | (1.6) | 16.6 | 0.4 |
Repurchase of Common Shares | (1,540) | (43.9) | |
Reduction of paid-up capital | (50) | (100) | |
Dividends | (100) | (50) | |
Dividends paid to non-controlling interests | (0.1) | (0.2) | |
Cash flows used in continuing financing activities | (900.1) | (225.5) | (174) |
Net change in cash and cash equivalents from continuing operations | (852.4) | 827.3 | 51.9 |
Cash flows provided by discontinued operations | 8.5 | 16.9 | (49.8) |
Cash and cash equivalents at the beginning of the year | 864.9 | 20.7 | 18.6 |
Cash and cash equivalents at the end of the year | 21 | 864.9 | 20.7 |
Changes in non-cash balances related to operating activities (excluding the effect of business acquisitions and disposals) | |||
Accounts receivable | (17.7) | (17.8) | (34.5) |
Inventories | 1.3 | (3.2) | 24.7 |
Contract assets | (21.3) | (27.8) | (54.1) |
Accounts payable, accrued charges and provisions | 34 | (26.8) | 40.1 |
Income taxes | 134.2 | (44.8) | 51.4 |
Deferred revenues | (5.7) | (1.7) | 14 |
Defined benefit plans | 13 | 7.2 | 10.4 |
Other | (1.1) | (15.2) | 1 |
Net change in non-cash balances related to operating activities | 136.7 | (130.1) | 53 |
Non-cash investing activities | |||
Net change in additions to property, plant and equipment and intangible assets financed with accounts payable | 67.8 | 21.8 | (6.2) |
Interest and taxes reflected as operating activities | |||
Cash interest payments | 289.2 | 269.1 | 286.1 |
Cash income tax payments (net of refunds) | $ 18 | $ 58.7 | $ 104.3 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS - Cash information - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Cash and cash equivalents consist of | |||
Cash | $ 20.2 | $ 863.2 | $ 19.9 |
Cash equivalents | 0.8 | 1.7 | 0.8 |
Total cash and cash equivalents | $ 21 | $ 864.9 | $ 20.7 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets | |||
Cash and cash equivalents | $ 21 | $ 864.9 | $ 20.7 |
Accounts receivable | 562.1 | 543 | 525 |
Contract assets | 144.4 | 132.8 | 106.6 |
Income taxes | 4.8 | 29.3 | 6.9 |
Inventories | 186.3 | 188.1 | 183.3 |
Other current assets | 120.4 | 119.7 | 102.3 |
Assets held for sale | 95 | ||
Current assets | 1,134 | 1,877.8 | 944.8 |
Non-current assets | |||
Property, plant and equipment | 3,413.5 | 3,554.3 | 3,562.5 |
Intangible assets | 1,135.3 | 983.1 | 1,224 |
Goodwill | 2,678.3 | 2,695.8 | 2,725.4 |
Derivative financial instruments | 887 | 591.8 | 809 |
Deferred income taxes | 51.8 | 33.2 | 16 |
Loans to the parent corporation | 596.1 | ||
Other assets | 201.5 | 185 | 176.9 |
Non-current assets | 8,963.5 | 8,043.2 | 8,513.8 |
Total assets | 10,097.5 | 9,921 | 9,458.6 |
Current liabilities | |||
Bank indebtedness | 24.3 | 18.9 | |
Accounts payable and accrued charges | 820.5 | 725.6 | 691.6 |
Provisions | 28.5 | 25.4 | 69.3 |
Deferred revenue | 340.7 | 346.8 | 339.7 |
Income taxes | 119.2 | 13.3 | 35.2 |
Current portion of long-term debt | 56.6 | 19.1 | 20.9 |
Liabilities held for sale | 6.6 | ||
Current liabilities | 1,396.4 | 1,130.2 | 1,175.6 |
Non-current liabilities | |||
Long-term debt | 6,318.4 | 5,292.6 | 5,617.2 |
Derivative financial instruments | 34.1 | 0.3 | |
Other liabilities | 213.3 | 195 | 202.8 |
Deferred income taxes | 744.7 | 724.1 | 604.2 |
Non-current liabilities | 7,276.4 | 6,245.8 | 6,424.5 |
Equity | |||
Capital stock | 3,019.7 | 3,630.8 | 3,701.4 |
Contributed surplus | 1.3 | 1.3 | 1.3 |
Deficit | (1,603.8) | (1,113) | (1,805.5) |
Accumulated other comprehensive loss | (81.3) | (60.4) | (129.5) |
Equity attributable to shareholders | 1,335.9 | 2,458.7 | 1,767.7 |
Non-controlling interests | 88.8 | 86.3 | 90.8 |
Total equity | 1,424.7 | 2,545 | 1,858.5 |
Commitments and contingencies | |||
Guarantees | |||
Total liabilities and equity | $ 10,097.5 | $ 9,921 | $ 9,458.6 |
SEGMENTED INFORMATION
SEGMENTED INFORMATION | 12 Months Ended |
Dec. 31, 2018 | |
SEGMENTED INFORMATION | |
SEGMENTED INFORMATION | SEGMENTED INFORMATION Quebecor Media Inc. (“Quebecor Media” or the “Corporation”) is incorporated under the laws of Québec and, since June 22, 2018, is a wholly owned subsidiary of Quebecor Inc. (“Quebecor” or the “parent corporation”). Unless the context otherwise requires, Quebecor Media or the Corporation refer to Quebecor Media Inc. and its subsidiaries. The Corporation’s head office and registered office is located at 612 rue Saint‑Jacques, Montréal (Québec), Canada. The percentages of voting rights and equity in its major subsidiaries are as follows: % voting % equity Videotron Ltd. 100.0 % 100.0 % TVA Group Inc. 99.9 % 68.4 % MediaQMI Inc. 100.0 % 100.0 % QMI Spectacles Inc. 100.0 % 100.0 % The Corporation operates, through its subsidiaries, in the following industry segments: Telecommunications, Media, and Sports and Entertainment. The Telecommunications segment offers television distribution, Internet access, business solutions, cable and mobile telephony and over-the-top video services in Canada and is engaged in the rental of movies, televisual products and video games through its video-on-demand service and video rental stores. The operations of the Media segment in Québec include the operation of an over-the-air television network and specialty television services, the operation of soundstage and equipment leasing and post-production services for the film and television industries, the printing, publishing and distribution of daily newspapers, the operation of Internet portals and specialized Web sites, the publishing and distribution of magazines, the distribution of movies, and the operation of an out-of-home advertising business. The activities of the Sports and Entertainment segment in Québec encompass the operation and management of the Videotron Centre in Québec City, show production, sporting and cultural events management, the publishing and distribution of books, the distribution and production of music, and the operation of two Quebec Major Junior Hockey League teams. These segments are managed separately since they all require specific market strategies. The accounting policies of each segment are the same as the accounting policies used for the consolidated financial statements. Segment income includes income from sales to third parties and inter segment sales. Transactions between segments are measured at exchange amounts between the parties. Sports and Head Office Telecommunications Media Entertainment and Intersegments Total 2018 Revenues $ 3,382.0 $ 728.6 $ 182.1 $ (111.7) $ 4,181.0 Employee costs 387.1 234.4 38.8 36.3 696.6 Purchase of goods and services 1,317.9 438.9 138.3 (143.1) 1,752.0 Adjusted EBITDA 1 1,677.0 55.3 5.0 (4.9) 1,732.4 Depreciation and amortization 717.9 Financial expenses 280.5 Loss on valuation and translation of financial instruments 0.9 Restructuring of operations, litigation and other items 29.8 Income before income taxes $ 703.3 Additions to property, plant and equipment $ 516.7 $ 28.7 $ 1.5 $ 5.8 $ 552.7 Additions to intangible assets 190.2 4.8 3.5 (1.1) 197.4 Sports and Head Office Telecommunications Media Entertainment and Intersegments Total 2017 (restated, note 1(b)) Revenues $ 3,287.8 $ 769.9 $ 181.3 $ (113.9) $ 4,125.1 Employee costs 388.8 232.0 37.6 47.8 706.2 Purchase of goods and services 1,341.2 468.6 137.5 (147.6) 1,799.7 Adjusted EBITDA 1 1,557.8 69.3 6.2 (14.1) 1,619.2 Depreciation and amortization 705.3 Financial expenses 281.8 Loss on valuation and translation of financial instruments 2.4 Restructuring of operations, litigation and other items 17.2 Gain on sale of spectrum licences (330.9) Impairment of goodwill and intangible assets 43.8 Loss on debt refinancing 15.6 Income before income taxes $ 884.0 Additions to property, plant and equipment $ 570.9 $ 29.4 $ 1.3 $ 0.2 $ 601.8 Additions to intangible assets 132.3 3.3 4.3 2.0 141.9 Sports and Head Office Telecommunications Media Entertainment and Intersegments Total 2016 (restated, note 1(b)) Revenues $ 3,192.3 $ 789.2 $ 185.0 $ (109.4) $ 4,057.1 Employee costs 379.7 242.4 38.3 47.5 707.9 Purchase of goods and services 1,301.7 492.9 144.4 (149.1) 1,789.9 Adjusted EBITDA 1 1,510.9 53.9 2.3 (7.8) 1,559.3 Depreciation and amortization 648.5 Financial expenses 302.0 Loss on valuation and translation of financial instruments 2.1 Restructuring of operations, litigation and other items 28.5 Impairment of goodwill and intangible assets 40.9 Loss on debt refinancing 7.3 Income before income taxes $ 530.0 Additions to property, plant and equipment $ 613.7 $ 37.2 $ 3.5 $ 0.1 $ 654.5 Additions to intangible assets 125.6 7.5 3.5 3.2 139.8 The Chief Executive Officer uses adjusted EBITDA as the measure of profit to assess the performance of each segment. Adjusted EBITDA is referred to as a non-International Financial Reporting Standards (“IFRS”) measure and is defined as net income before depreciation and amortization, financial expenses, loss on valuation and translation of financial instruments, restructuring of operations, litigation and other items, gain on sale of spectrum licences, impairment of goodwill and intangible assets, loss on debt refinancing, income taxes and income from discontinued operations |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2018 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Basis of presentation The consolidated financial statements have been prepared in accordance with IFRS as issued by the International Accounting Standards Board (“IASB”). These consolidated financial statements have been prepared on a historical cost basis, except for certain financial instruments (note 1(k)), the liability related to stock-based compensation (note 1(v)) and the net defined benefit liability (note 1(w)), and they are presented in Canadian dollars (“CAN dollars”), which is the currency of the primary economic environment in which the Corporation operates (“functional currency”). Comparative figures for the years ended December 31, 2017 and 2016 have been restated to conform to the presentation adopted for the year ended December 31, 2018. (b) Changes in accounting policies (i) IFRS 9 – Financial Instruments On January 1, 2018, the Corporation adopted the new rules under IFRS 9, Financial Instruments, which simplify the measurement and classification of financial assets by reducing the number of measurement categories in IAS 39, Financial Instruments: Recognition and Measurement . The new standard also provides for a fair value option in the designation of a non-derivative financial liability and its related classification and measurement, as well as for a new hedge accounting model more closely aligned with risk-management activities undertaken by entities. Under the new rules, most of financial assets and liabilities of the Corporation are now classified as subsequently measured at amortized cost, except for derivative financial instruments, which are measured at fair value. The Corporation is also using the IFRS 9 expected credit losses method to estimate the provision for expected credit losses on its financial assets. The adoption of IFRS 9 had no impact on the consolidated financial statements. (ii) IFRS 15 – Revenue from Contracts with Customers On January 1, 2018, the Corporation adopted, on a fully retrospective basis, the new rules under IFRS 15, Revenue from Contracts with Customers , which specify how and when an entity should recognize revenue, and which also require the entity to provide users of financial statements with more informative disclosures. The standard provides a single, principles-based, five-step model to apply to each contract with a customer (note 1(f)). The adoption of IFRS 15 had significant impacts on the consolidated financial statements, mainly in the Telecommunications segment, with regard to the timing of the recognition of its revenues, the classification of its revenues, as well as the capitalization of costs, such as the costs to obtain a contract and connection costs. Under IFRS 15, the total consideration from a contract with multiple deliverables is now allocated to all performance obligations in the contract, based on the stand-alone selling price of each obligation, without being limited to a non-contingent amount. The Telecommunications segment provides mobile devices and services under contracts with multiple deliverables and for a fixed period of time. Under IFRS 15, promotional offers related to the sale of mobile devices, previously accounted for as a reduction in related equipment sales on activation, are now considered in the total consideration to be allocated to all performance obligations. Among other impacts, the adoption of IFRS 15 results in an increase in the revenue from the device sale and in a decrease in the mobile service revenue recognized over the contract term. The timing of the recognition of these revenues therefore changes under IFRS 15. However, the total revenue recognized over a contract term relating to all performance obligations within the contract remains the same as under the previous rules. The portion of revenues that is earned without having been invoiced is now presented as contract assets in the consolidated balance sheets, which asset is realized during the term of the contract. The long-term portion of contract assets is included in “Other assets” in the consolidated balance sheets. All other types of revenue have not been impacted by the adoption of IFRS 15. In addition, under IFRS 15, certain costs to obtain a contract, mainly sales commissions, are capitalized and amortized as operating expenses over the period of time the customer is expected to maintain its service or over the contract term. Previously, such costs were expensed as incurred. Also, the capitalization of connection costs is no longer limited to the related connection revenues as under the previous rules. These capitalized costs are included in “Other assets” as contract costs in the consolidated balance sheets. The adoption of IFRS 15 had no impact on cash flows from operating, investing and financing activities. The retroactive adoption of IFRS 15 had the following impacts on the comparative consolidated financial figures: Consolidated statements of income and comprehensive income Increase (decrease) 2017 2016 Revenues $ 22.4 $ 52.5 Purchase of goods and services (12.4) (13.2) Deferred income tax expense 9.2 17.4 Net income and comprehensive income attributable to shareholders $ 25.6 $ 48.3 Consolidated balance sheets December 31, December 31, Increase (decrease) 2017 2016 Other assets Contract assets 1 $ 183.6 $ 155.8 Contract costs 2 92.5 85.4 Deferred income tax liability 73.2 63.9 Deficit (202.9) (177.3) 1 The current portion of contract assets is $132.8 million as of December 31, 2017 and $106.6 million as of December 31, 2016. 2 The current portion of contract costs is $55.9 million as of December 31, 2017 and $49.4 million as of December 31, 2016 and is presented under “Other current assets”. (c) Consolidation The consolidated financial statements include the accounts of the Corporation and its subsidiaries. Intercompany transactions and balances are eliminated on consolidation. A subsidiary is an entity controlled by the Corporation. Control is achieved when the Corporation is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Non-controlling interests in the net assets and results of consolidated subsidiaries are identified separately from the parent corporation’s ownership interest. Non-controlling interests in the equity of a subsidiary consist of the amount of non‑controlling interests calculated at the date of the original business combination and their share of changes in equity since that date. Changes in non-controlling interests in a subsidiary that do not result in a loss of control by the Corporation are accounted for as equity transactions. (d) Business acquisition A business acquisition is accounted for by the acquisition method. The cost of an acquisition is measured at the fair value of the consideration given in exchange for control of the business acquired at the acquisition date. This consideration can be comprised of cash, assets transferred, financial instruments issued, or future contingent payments. The identifiable assets and liabilities of the business acquired are recognized at their fair value at the acquisition date. Results of operations of a business acquired are included in the Corporation’s consolidated financial statements from the date of the business acquisition. Business acquisition and integration costs are expensed as incurred and included as other items in the consolidated statements of income. Non-controlling interests in an entity acquired are presented in the consolidated balance sheets within equity, separately from the equity attributable to shareholders. (e) Foreign currency translation Foreign currency transactions are translated to the functional currency by applying the exchange rate prevailing at the date of the transaction. Translation gains and losses on monetary assets and liabilities denominated in a foreign currency are included in financial expenses, or in gain or loss on valuation and translation of financial instruments. (f) Revenue recognition The Corporation accounts for a contract with a customer only when all of the following criteria are met: · The parties to the contract have approved the contract (in writing, orally or in accordance with other customary business practices) and are committed to perform their respective obligations; · The entity can identify each party's rights regarding the goods or services to be transferred; · The entity can identify the payment terms for the goods or services to be transferred; · The contract has commercial substance (i.e. the risk, timing or amount of the entity's future cash flows is expected to change as a result of the contract); and · It is probable that the entity will collect the consideration to which it is entitled in exchange for the goods or services to be transferred to the customer. The portion of revenues that is invoiced and unearned is presented as “Deferred revenues” in the consolidated balance sheets. Deferred revenues are usually recognized as revenues in the subsequent year. Telecommunications The Telecommunications segment provides services under multiple deliverable arrangements, mainly for mobile contracts in which the sale of mobile devices is bundled with telecommunication services over the contract term. The total consideration from a contract with multiple deliverables is allocated to all performance obligations in the contract based on the stand-alone selling price of each obligation. The total consideration is generally comprised of an upfront fee for the equipment sale and a monthly fee for the telecommunication service. Each performance obligation of multiple deliverable arrangements is then separately accounted for based on its allocated consideration amount. The Corporation does not adjust the amount of consideration allocated to the equipment sale for the effects of a financing component since this component is not significant. The Telecommunications segment recognizes each of its main activities’ revenues as follows: · Operating revenues from subscriber services, such as cable television, Internet access, cable and mobile telephony, and over-the-top video services are recognized when services are provided; · Revenues from equipment sales to subscribers are recognized when the equipment is delivered; · Operating revenues related to service contracts are recognized in income on a straight-line basis over the period in which the services are provided; and · Cable connection and mobile activation revenues are deferred and recognized as revenues over the period of time the customer is expected to remain a customer of the Corporation or over the contract term. When a mobile device and a service are bundled under a single mobile contract, the term of the contract is generally 24 months. The portion of mobile revenues earned without being invoiced is presented as contract assets in the consolidated balance sheets. Contract assets are realized over the term of the contract. Media The Media segment recognizes each of its main activities’ revenues as follows: · Advertising revenues are recognized when the advertising is aired on television, is featured in newspapers or magazines or is displayed on the digital properties or on transit shelters; · Revenues from subscriptions to specialty television channels or to online publications are recognized on a monthly basis at the time service is provided or over the period of the subscription; · Revenues from the sale or distribution of newspapers and magazines are recognized upon delivery, net of provisions for estimated returns based on historical rate of returns; · Soundstage and equipment leasing revenues are recognized over the rental period; and · Revenues derived from speciality film and television services are recognized when services are provided. Sports and Entertainment The Sports and Entertainment segment recognizes each of its main activities’ revenues as follows: · Revenues from the sale or distribution of books and entertainment products are recognized upon delivery, net of provisions for estimated returns based on historical rate of returns; · Revenues from renting the arena and from tickets (including season tickets), food and beverage sales are recognized when the events take place and/or goods are sold, as the case may be; · Revenues from the rental of suites are recognized ratably over the period of the agreement; · Revenues from the sale of advertising in the form of venue signage or sponsorships, are recognized ratably over the period of the agreement; and · Revenues derived from sporting and cultural event management are recognized when services are provided. (g) Impairment of assets For the purposes of assessing impairment, assets are grouped in cash-generating units (“CGUs”), which represent the lowest levels for which there are separately identifiable cash inflows generated by those assets. The Corporation reviews, at each balance sheet date, whether events or circumstances have occurred to indicate that the carrying amounts of its long‑lived assets with finite useful lives may be less than their recoverable amounts. Goodwill, intangible assets having an indefinite useful life, and intangible assets not yet available for use are tested for impairment each financial year, as well as whenever there is an indication that the carrying amount of the asset, or the CGU to which an asset has been allocated, exceeds its recoverable amount. The recoverable amount is the higher of the fair value less costs of disposal and the value in use of the asset or the CGU. Fair value less costs of disposal represents the amount an entity could obtain at the valuation date from the asset’s disposal in an arm’s length transaction between knowledgeable, willing parties, after deducting the costs of disposal. The value in use represents the present value of the future cash flows expected to be derived from the asset or the CGU. An impairment loss is recognized in the amount by which the carrying amount of an asset or a CGU exceeds its recoverable amount. When the recoverable amount of a CGU to which goodwill has been allocated is lower than the CGU’s carrying amount, the related goodwill is first impaired. Any excess amount of impairment is recognized and attributed to assets in the CGU, prorated to the carrying amount of each asset in the CGU. An impairment loss recognized in prior periods for long-lived assets with finite useful lives and intangible assets having an indefinite useful life, other than goodwill, can be reversed through the consolidated statement of income to the extent that the resulting carrying value does not exceed the carrying value that would have been the result had no impairment loss been recognized previously. (h) Barter transactions In the normal course of operations, the Corporation principally offers advertising in exchange for goods and services. Revenues thus earned and expenses incurred are accounted for on the basis of the fair value of goods and services provided. (i) Income taxes Current income taxes are recognized with respect to amounts expected to be paid or recovered under the tax rates and laws that have been enacted or substantively enacted at the balance sheet date. Deferred income taxes are accounted for using the liability method. Under this method, deferred income tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the carrying amounts of existing assets and liabilities in the consolidated financial statements and their respective tax bases. Deferred income tax assets and liabilities are measured using enacted or substantively enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred income tax assets and liabilities is recognized in income in the period that includes the substantive enactment date. A deferred tax asset is recognized initially when it is probable that future taxable income will be sufficient to use the related tax benefits and may be reduced subsequently, if necessary, to an amount that is more likely than not to be realized. A deferred tax expense or benefit is recognized either in other comprehensive income or directly in equity to the extent that it relates to items that are recognized in other comprehensive income or directly in equity in the same or a different period. In the course of the Corporation’s operations, there are a number of uncertain tax positions due to the complexity of certain transactions and to the fact that related tax interpretations and legislation are continually changing. When a tax position is uncertain, the Corporation recognizes an income tax benefit or reduces an income tax liability only when it is probable that the tax benefit will be realized in the future or that the income tax liability is no longer probable. (j) Leases Assets under leasing agreements are classified at the inception of the lease as (i) finance leases whenever the terms of the lease substantially transfer all the risks and rewards of ownership of the asset to the lessee, or as (ii) operating leases for all other leases. Operating lease rentals are recognized in the consolidated statements of income on a straight‑line basis over the period of the lease. Any lessee incentives are deferred and recognized evenly over the lease term. (k) Financial instruments Classification, recognition and measurement Most of financial assets and liabilities are classified as subsequently measured at amortized cost, except for derivative financial instruments, which are measured at fair value through other comprehensive income or through profit or loss. Contingent consideration arising from a business acquisition or disposal are measured at fair value at the transaction date with subsequent changes in fair value recorded in the consolidated statements of income. Derivative financial instruments and hedge accounting The Corporation uses various derivative financial instruments to manage its exposure to fluctuations in foreign currency exchange rates and interest rates. The Corporation does not hold or use any derivative financial instruments for speculative purposes. Under hedge accounting, the Corporation documents all hedging relationships between hedging instruments and hedged items, as well as its strategy for using hedges and its risk-management objective. It also designates its derivative financial instruments as either fair value hedges or cash flow hedges when they qualify for hedge accounting. The Corporation assesses the effectiveness of its hedging relationships at initiation and on an ongoing basis. The Corporation generally enters into the following types of derivative financial instruments: · The Corporation uses foreign exchange forward contracts to hedge foreign currency rate exposure on anticipated equipment or inventory purchases in a foreign currency. The Corporation also uses offsetting foreign exchange forward contracts in combination with cross-currency interest rate swaps to hedge foreign currency rate exposure on principal payments on foreign currency denominated debt. These foreign exchange forward contracts are designated as cash flow hedges. · The Corporation uses cross-currency interest rate swaps to hedge (i) foreign currency rate exposure on interest and principal payments on foreign currency denominated debt and/or (ii) fair value exposure on certain debt resulting from changes in interest rates. The cross-currency interest rate swaps that set all future interest and principal payments on U.S.-dollar-denominated debt in fixed CAN dollars, in addition to converting an interest rate from a floating rate to a floating rate or from a fixed rate to a fixed rate, are designated as cash flow hedges. The cross-currency interest rate swaps are designated as fair value hedges when they set all future interest and principal payments on U.S.-dollar-denominated debt in fixed CAN dollars, in addition to converting the interest rate from a fixed rate to a floating rate. · The Corporation uses interest rate swaps to manage fair value exposure on certain debts resulting from changes in interest rates. These swap agreements require a periodic exchange of payments without the exchange of the notional principal amount on which the payments are based. These interest rate swaps are designated as fair value hedges when they convert the interest rate from a fixed rate to a floating rate, or as cash flow hedges when they convert the interest rate from a floating rate to a fixed rate. · The Corporation has established a hedge ratio of one for one for all its hedging relationships as underlying risks of its hedging derivatives are identical to the hedged item risks. The Corporation measures and records the effectiveness of its hedging relationships as follows: · For cash flow hedges, the hedge effectiveness is tested and measured by comparing changes in the fair value of the hedging derivative with the changes in the fair value of a hypothetical derivative that simulates the hedged items cash flows. · For fair value hedges, the hedge effectiveness is tested and measured by comparing changes in the fair value of the hedging derivative with the changes in the fair value of the hedged item attributable to the hedged risk. · Most of the Corporation’s hedging relationships are not generating material ineffectiveness. The ineffectiveness, if any, is recorded in the consolidated statements of income as a gain or loss on valuation and translation of financial instruments. Under hedge accounting, the Corporation applies the following accounting policies: · For derivative financial instruments designated as fair value hedges, changes in the fair value of the hedging derivative recorded in income are substantially offset by changes in the fair value of the hedged item to the extent that the hedging relationship is effective. When a fair value hedge is discontinued, the carrying value of the hedged item is no longer adjusted and the cumulative fair value adjustments to the carrying value of the hedged item are amortized to income over the remaining term of the original hedging relationship. · For derivative financial instruments designated as cash flow hedges, the effective portion of a hedge is reported in other comprehensive income until it is recognized in income during the same period in which the hedged item affects income, while the ineffective portion is immediately recognized in income. When a cash flow hedge is discontinued, the amounts previously recognized in accumulated other comprehensive income are reclassified to income when the variability in the cash flows of the hedged item affects income. Any change in the fair value of derivative financial instruments recorded in income is included in gain or loss on valuation and translation of financial instruments. Interest expense on hedged long‑term debt is reported at the hedged interest and foreign currency rates. Derivative financial instruments that do not qualify for hedge accounting, including derivatives that are embedded in financial or non‑financial contracts that are not closely related to the host contracts, are reported on a fair value basis in the consolidated balance sheets. Any change in the fair value of these derivative financial instruments is recorded in the consolidated statements of income as a gain or loss on valuation and translation of financial instruments. (l) Financing fees Financing fees related to long-term debt are capitalized in reduction of long-term debt and amortized using the effective interest rate method. (m) Tax credits and government assistance The Corporation has access to several government programs designed to support production and distribution of televisual products and movies, as well as music products, magazine and book publishing in Canada. In addition, the Corporation receives tax credits mainly related to its research and development activities, publishing activities and digital activities. Government financial assistance is accounted for as revenue or as a reduction in related costs, whether capitalized and amortized or expensed, in the year the costs are incurred and when management has reasonable assurance that the conditions of the government programs are being met. (n) Cash and cash equivalents Cash and cash equivalents include highly liquid investments purchased three months or less from maturity and are recorded at fair value. These highly liquid investments consisted mainly of Bankers’ acceptances and term deposits. (o) Accounts receivable and contract assets Accounts receivable and contract assets are presented net of a provision for expected credit losses. The Corporation is using the IFRS 9 expected credit losses method to estimate that provision, which considers the specific credit risk of its customers, the expected lifetime of its financial assets, historical trends and economic conditions. Amounts receivable are written off when deemed uncollectible. (p) Inventories Inventories are valued at the lower of cost, determined by the first-in, first-out method or the weighted‑average cost method, and net realizable value. Net realizable value represents the estimated selling price in the ordinary course of business, less the estimated costs of completion and the estimated costs necessary to make the sale. When the circumstances that previously caused inventories to be written down below cost no longer exist, the amount of the write‑down is reversed. In particular, inventories related to broadcasting activities, which primarily comprise programs and broadcast and distribution rights, are accounted for as follows: (i) Programs produced and productions in progress Programs produced and productions in progress related to broadcasting activities are accounted for at the lesser of cost and net realizable value. Cost includes direct charges for goods and services and the share of labour and general expenses related to each production. The cost of each program is charged to operating expenses when the program is broadcast. (ii) Broadcast and distribution rights Broadcast rights are essentially contractual rights allowing the limited or unlimited broadcast of televisual products or movies. Distribution rights include costs to acquire distribution rights for televisual products and movies and other operating costs incurred that generate future economic benefits. The Corporation records the rights acquired as inventory and the obligations incurred under a licence agreement as a liability when the broadcast or distribution period begins and all of the following conditions have been met: (a) the cost of the licence for each program, movies, series or right to broadcast a live event is known or can be reasonably determined; (b) the programs, movies or series have been accepted or the live event is broadcast in accordance with the conditions of the licence agreement; (c) the programs, movies or series are available for distribution, first showing or telecast, or when the live event is broadcast. Amounts paid for broadcast and distribution rights before all of the above conditions are met are recorded as prepaid rights. Broadcast and distribution rights are classified as current or long-term assets, based on management’s estimate of the broadcast or distribution period. These rights are charged to operating expenses when televisual products and movies are broadcast over the contract period, using a method based on how future economic benefits from those rights will be generated. Broadcast and distribution rights payable are classified as current or long-term liabilities based on the payment terms included in the licence. Estimates of future revenues used to determine the net realizable value of inventories related to the broadcasting or distribution of television products and movies are examined periodically by management and revised as necessary. The carrying value of programs produced and productions in progress, of broadcast and distribution rights is reduced to the net realizable value, if necessary, based on this assessment. (q) Long-term investments Investments in companies subject to significant influence are accounted for using the equity method. Under the equity method, the share of the results of operations of the associated corporation is recorded in the consolidated statements of income. Carrying values of investments are reduced to estimated fair values if there is objective evidence that the investment is impaired. (r) Property, plant and equipment Property, plant and equipment are recorded at cost. Cost represents the acquisition costs, net of government grants and investment tax credits, or construction costs, including preparation, installation and testing costs. In the case of projects to construct cable and mobile networks, the cost includes equipment, direct labour and related overhead costs. Projects under development may also be comprised of advance payments made to suppliers for equipment under construction. Borrowing costs are also included in the cost of property, plant and equipment during the development phase. Expenditures, such as maintenance and repairs, are expensed as incurred. Depreciation is calculated on a straight-line basis over the following estimated useful lives: Assets Estimated useful lives Buildings and leasehold improvements 10 to 40 years Machinery and equipment 3 to 20 years Telecommunication networks 3 to 20 years Depreciation methods, residual values, and the useful lives of significant property, plant and equipment are reviewed at least once a year. Any change is accounted for prospectively as a change in accounting estimate. Leasehold improvements are depreciated over the shorter of the term of the lease and their estimated useful life. The Corporation does not record any decommissioning obligations in connection with its cable distribution networks. The Corporation expects to renew all of its agreements with utility companies to access their support structures in the future, making the retirement date so far into the future that the present value of the restoration costs is insignificant for those assets. A decommissioning obligation is however recorded for the rental of sites related to the mobile network. Videotron Ltd. (“Videotron”) is engaged in an agreement to operate a shared LTE network in the Province of Québec and the Ottawa region. (s) Goodwill and intangible assets Goodwill Goodwill initially arising from a business acquisition is measured and recognized as the excess of the fair value of the consideration paid over the fair value of the recognized identifiable assets acquired and liabilities assumed. Goodwill is allocated as at the date of a business acquisition to a CGU for purposes of impairment testing (note 1(g)). The allocation is made to the CGU or group of CGUs expected to benefit from the synergies of the business acquisition. Intangible assets Spectrum licences are recorded at cost. Spectrum licences have an indefinite useful life and are not amortized based on the following facts: (i) the Corporation intends to renew the spectrum licences and believes that they are likely to be renewed by Innovation, Science and Economic Development Canada ("ISED Canada"), (ii) the Corporation has the financial and operational ability to renew these spectrum licences, (iii) currently, the competitive, legal and regulatory landscape does not limit the useful lives of the spectrum licences, and (iv) the Corporation foresees no limit to the period during which these licences can be expected to generate cash flows in the future. Broadcasting licences, trademarks and sport franchises also have an indefinite useful life and are not amortized. These intangibles assets are recorded at cost or at fair value at the acquisition date if they are acquired through a business acquisition. Software is recorded at cost. In particular, internally generated intangible assets such as software and website development are mainly comprised of internal costs in connection with the development of assets to be used internally or to provide services to customers. These costs are capitalized when the development stage of the software application begins and costs incurred prior to that stage are recognized as expenses. Naming rights for the Videotron Centre in Québec City are recognized at cost. Customer relationships acquired through a business acquisition are recorded at fair value at the date of acquisition. Borrowing costs directly attributable to the acquisition, development or production of an inta |
REVENUES
REVENUES | 12 Months Ended |
Dec. 31, 2018 | |
REVENUES | |
REVENUES | 2. REVENUES 2018 2017 2016 (restated, (restated, note 1(b)) note 1(b)) Internet $ 1,079.3 $ 1,030.9 $ 978.7 Cable television 996.7 1,009.6 1,024.3 Mobile telephony 534.4 469.8 409.6 Cable telephony 368.6 397.8 424.8 Telecommunication equipment sales 233.5 219.0 206.9 Connection and data services 108.2 104.8 99.2 Over-the-top video 47.0 39.7 31.4 Advertising - television 246.1 267.5 254.8 Subscription - television 126.2 125.0 119.9 Soundstage and equipment leasing and post-production services 68.4 67.1 59.3 Advertising – newspapers and magazines 106.0 125.4 148.0 Circulation and other – newspapers and magazines 146.0 152.7 168.9 Other 120.6 115.8 131.3 $ 4,181.0 $ 4,125.1 $ 4,057.1 |
EMPLOYEE COSTS AND PURCHASE OF
EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES | 12 Months Ended |
Dec. 31, 2018 | |
EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES | |
EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES | 3. EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES The main components are as follows: 2018 2017 2016 (restated, (restated, note 1(b)) note 1(b)) Employee costs $ 895.9 $ 893.6 $ 891.2 Less employee costs capitalized to property, plant and equipment and to intangible assets (199.3) (187.4) (183.3) 696.6 706.2 707.9 Purchase of goods and services: Royalties, rights and creation costs 681.7 677.9 701.9 Cost of products sold 380.2 360.1 338.3 Service contracts 154.3 172.3 168.7 Marketing, circulation and distribution expenses 105.9 108.9 113.8 Building expenses 97.9 99.5 92.5 Other 332.0 381.0 374.7 1,752.0 1,799.7 1,789.9 $ 2,448.6 $ 2,505.9 $ 2,497.8 |
FINANCIAL EXPENSES
FINANCIAL EXPENSES | 12 Months Ended |
Dec. 31, 2018 | |
FINANCIAL EXPENSES | |
FINANCIAL EXPENSES | 4. FINANCIAL EXPENSES 2018 2017 2016 Interest on long-term debt $ 287.8 $ 274.7 $ 288.0 Amortization of financing costs and long-term debt discount 6.8 6.9 7.0 Interest on net defined benefit liability 6.2 5.8 6.7 Loss (gain) on foreign currency translation on short-term monetary items 2.3 (2.0) 0.5 Interest from the parent corporation (14.8) — — Other (7.8) (3.6) (0.2) $ 280.5 $ 281.8 $ 302.0 |
RESTRUCTURING OF OPERATIONS, LI
RESTRUCTURING OF OPERATIONS, LITIGATION AND OTHER ITEMS | 12 Months Ended |
Dec. 31, 2018 | |
RESTRUCTURING OF OPERATIONS, LITIGATION AND OTHER ITEMS | |
RESTRUCTURING OF OPERATIONS, LITIGATION AND OTHER ITEMS | 5. RESTRUCTURING OF OPERATIONS, LITIGATION AND OTHER ITEMS In 2018, a net charge of $14.9 million was recorded relating mainly to various cost reduction initiatives across the Corporation and disposal of assets (net charges of $17.2 million in 2017 and $28.5 million in 2016 which were related to cost reduction initiatives, developments in certain litigations and the migration of subscribers from analog to digital services in the Telecommunications segment). In 2018, an impairment charge on assets of $14.9 million was also recorded mainly in the Telecommunications segment as a result of restructuring initiatives. |
GAIN ON SALE OF SPECTRUM LICENC
GAIN ON SALE OF SPECTRUM LICENCES | 12 Months Ended |
Dec. 31, 2018 | |
GAIN ON SALE OF SPECTRUM LICENCES | |
GAIN ON SALE OF SPECTRUM LICENCES | 6. GAIN ON SALE OF SPECTRUM LICENCES On June 20, 2017, Videotron sold its Advanced Wireless Service ("AWS”) spectrum licence in the greater Toronto region to Rogers Communications Canada Inc. for a cash consideration of $184.2 million, pursuant to the transfer option held by Videotron since 2013. The sale resulted in a gain on disposal of $87.8 million. On July 24, 2017, Videotron sold its seven 2500 MHz and 700 MHz wireless spectrum licences outside Québec to Shaw Communications Inc. for a cash consideration of $430.0 million. The sale resulted in a gain on disposal of $243.1 million. As a result of these transactions, tax benefits of $44.4 million, on previous years' capital losses, were recognized in the consolidated statement of income in 2017. |
IMPAIRMENT OF GOODWILL AND OTHE
IMPAIRMENT OF GOODWILL AND OTHER ASSETS | 12 Months Ended |
Dec. 31, 2018 | |
IMPAIRMENT OF GOODWILL AND OTHER ASSETS | |
IMPAIRMENT OF GOODWILL AND OTHER ASSETS | 7. IMPAIRMENT OF GOODWILL AND INTANGIBLE ASSETS 2018 2017 2016 Impairment of goodwill $ — $ 30.0 $ 40.1 Impairment of intangible assets — 13.8 0.8 $ — $ 43.8 $ 40.9 2017 During the third quarter of 2017, the Corporation performed an impairment test of its Magazines CGU in light of the continuous downtrend in revenues in this industry. The Corporation concluded that the recoverable amount was less than the carrying amount of the Magazines CGU and recorded a goodwill impairment charge of $30.0 million (including $1.5 million without any tax consequence) and an impairment charge of $12.4 million on intangible assets (including $3.1 million without any tax consequence). An impairment charge on intangible assets of $1.4 million was also recorded in 2017 in other segments. 2016 During the third quarter of 2016, the Corporation performed an impairment test of its Magazines CGU in light of the continuous downtrend in advertising revenues in this industry. The Corporation concluded that the recoverable amount was less than the carrying amount of the Magazines CGU and recorded a goodwill impairment charge of $40.1 million (without any tax consequence). An impairment charge on intangible assets of $0.8 million was also recorded in 2016 in other segments. |
LOSS ON DEBT REFINANCING
LOSS ON DEBT REFINANCING | 12 Months Ended |
Dec. 31, 2018 | |
LOSS ON DEBT REFINANCING | |
LOSS ON DEBT REFINANCING | 8. LOSS ON DEBT REFINANCING 2017 · On May 1, 2017, Videotron redeemed all of its issued and outstanding 6.875% Senior Notes due July 15, 2021, in aggregate principal amount of $125.0 million, for a cash consideration of $129.3 million. · On May 1, 2017, Quebecor Media redeemed all of its issued and outstanding 7.375% Senior Notes due January 15, 2021, in aggregate principal amount of $325.0 million, for a cash consideration of $333.0 million. These transactions resulted in a total loss of $15.6 million in 2017. 2016 · On December 2, 2016, Videotron issued a notice for the redemption of an aggregate principal amount of $175.0 million of its issued and outstanding 6.875% Senior Notes due July 15, 2021. On January 5, 2017, the Senior Notes were redeemed for a cash consideration of $181.0 million. This transaction resulted in a loss of $7.3 million in 2016. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2018 | |
INCOME TAXES | |
INCOME TAXES | 9. INCOME TAXES The following table reconciles income taxes at the Corporation’s domestic statutory tax rate of 26.7% in 2018 (26.8% in 2017 and 26.9% in 2016) and income taxes in the consolidated statements of income: 2018 2017 2016 (restated, (restated, note 1(b)) note 1(b)) Income taxes at domestic statutory tax rate $ 187.8 $ 236.9 $ 142.5 (Reduction) increase resulting from: Effect of non-deductible charges, non-taxable income and differences between current and future tax rates (1.2) (48.5) 1.0 Change in benefit arising from the recognition of current and prior year tax losses (notes 6 and 30) (18.5) (47.0) (0.5) Non-deductible impairment of goodwill — 0.4 10.8 Change in deferred tax balances due to a change in substantively enacted tax rates — — (6.4) Effect of tax consolidation transactions with the parent corporation — — (0.3) Other (1.5) (0.6) (3.8) Income taxes $ 166.6 $ 141.2 $ 143.3 The significant items comprising the Corporation’s net deferred income tax liability and their impact on the deferred income tax expense are as follows: Consolidated Consolidated balance sheets income statements 2018 2017 2018 2017 2016 (restated, (restated, (restated, note 1(b)) note 1(b)) note 1(b)) Loss carryforwards $ 22.8 $ 0.4 $ (8.0) $ 3.6 $ 2.9 Accounts payable, accrued charges, provisions and deferred revenue 13.9 14.5 0.6 1.4 (4.0) Defined benefit plans 40.6 35.5 (3.2) (1.9) (2.2) Contract assets (54.3) (48.5) 5.8 7.4 14.3 Property, plant and equipment (471.7) (488.1) (16.4) 84.5 12.3 Goodwill, intangible assets and other assets (233.4) (199.4) 34.0 43.9 25.8 Long-term debt and derivative financial instruments (21.0) (14.0) 1.3 (7.4) 0.3 Benefits from a general partnership — — — (0.6) (67.0) Other 10.2 8.7 (2.4) 1.5 2.9 $ (692.9) $ (690.9) $ 11.7 $ 132.4 $ (14.7) Changes in the net deferred income tax liability are as follows: Note 2018 2017 (restated, note 1(b)) Balance at beginning of year $ (690.9) $ (588.2) Recognized in income as continuing operations (11.7) (132.4) Recognized in other comprehensive income (3.8) 28.9 Acquisition of tax deductions 28 14.4 — Other (0.9) 0.8 Balance at end of year $ (692.9) $ (690.9) Deferred income tax asset $ 51.8 $ 33.2 Deferred income tax liability (744.7) (724.1) $ (692.9) $ (690.9) As of December 31, 2018, the Corporation had loss carryforwards for income tax purposes of $17.3 million available to reduce future taxable income, that will expire between 2035 and 2038. These losses have been recognized. The Corporation also had capital losses of $589.8 million that can be carried forward indefinitely and applied only against future capital gains of which $139.0 million were recognized. There are no income tax consequences attached to the payment of dividends or distributions in 2018, 2017 or 2016 by the Corporation to its shareholders. |
BUSINESS ACQUISITIONS
BUSINESS ACQUISITIONS | 12 Months Ended |
Dec. 31, 2018 | |
BUSINESS ACQUISITIONS | |
BUSINESS ACQUISITIONS | 10. BUSINESS ACQUISITIONS 2018 · In 2018, the Corporation acquired businesses, included in the Media segment and in the Sport and Entertainment segment, for a total cash consideration of $10.3 million. 2017 · In 2017, the Corporation acquired a business, included in the Sports and Entertainment segment, for a cash consideration of $0.2 million. 2016 · On January 7, 2016, Videotron acquired Fibrenoire inc., a company that provides businesses with fibre-optic connectivity services, for a purchase price of $125.0 million. At closing, Videotron paid an amount of $119.1 million, net of cash acquired of $1.8 million. A post-closing adjustment of $0.2 million was received in the second quarter of 2016. The purchase price balance was paid in February 2017 for an amount of $5.6 million plus interests of $0.3 million. · An amount of $0.6 million was also paid in 2016 relating to balances payable on prior business acquisitions. The purchase price allocation between the fair value of identifiable assets and liabilities related to business acquisitions in 2016 is summarized as follows: 2016 Assets acquired Non-cash current assets $ 5.5 Property, plant and equipment 32.7 Intangible assets 15.6 Goodwill 87.1 140.9 Liabilities assumed Non-cash current liabilities (3.1) Deferred income taxes (7.5) Other long-term liabilities (5.7) (16.3) Net assets acquired at fair value $ 124.6 Consideration Cash, net of cash acquired $ 119.0 Balance payable 5.6 $ 124.6 An amount of $0.6 million of goodwill is deductible for tax purposes in 2018 (none in 2017 and $0.1 million in 2016). |
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE | 12 Months Ended |
Dec. 31, 2018 | |
ACCOUNTS RECEIVABLE | |
ACCOUNTS RECEIVABLE | 11. ACCOUNTS RECEIVABLE 2018 2017 Trade $ 468.0 $ 486.4 Other 1 94.1 56.6 $ 562.1 $ 543.0 1 Includes interest receivable from Quebecor of an amount of $8.6 million as of December 31, 2018. |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2018 | |
INVENTORIES | |
INVENTORIES | 12. INVENTORIES 2018 2017 Finished goods $ 88.8 $ 87.6 Programs, broadcast and distribution rights 77.3 78.2 Raw materials and supplies 20.2 22.3 $ 186.3 $ 188.1 Cost of inventories included in purchase of goods and services amounted to $721.5 million in 2018 ($721.0 million in 2017 and $738.3 million in 2016). Write‑downs of inventories totalling $4.7 million were recognized in purchase of goods and services in 2018 ($11.1 million in 2017 and $6.8 million in 2016). |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2018 | |
PROPERTY, PLANT AND EQUIPMENT | |
PROPERTY, PLANT AND EQUIPMENT | 13. PROPERTY, PLANT AND EQUIPMENT For the years ended December 31, 2018 and 2017, changes in the net carrying amount of property, plant and equipment are as follows: Land, buildings and Machinery Projects leasehold and Telecommunication under improvements equipment networks development Total Cost Balance as of December 31, 2016 $ 573.6 $ 1,663.6 $ 5,549.1 $ 92.5 $ 7,878.8 Additions 35.9 145.5 364.4 56.0 601.8 Net change in additions financed with accounts payable — (2.0) (3.4) 1.0 (4.4) Reclassification — 14.4 90.1 (104.5) — Retirement, disposals and other 1 3.4 (70.3) (98.4) 1.2 (164.1) Balance as of December 31, 2017 612.9 1,751.2 5,901.8 46.2 8,312.1 Additions 20.0 151.4 297.3 84.0 552.7 Net change in additions financed with accounts payable — 1.8 (11.9) 13.3 3.2 Reclassification 2.1 3.1 41.5 (46.7) — Reclassification to assets held for sale (84.0) — — — (84.0) Retirement, disposals and other 1 (6.6) (35.3) (231.5) (5.8) (279.2) Balance as of December 31, 2018 $ 544.4 $ 1,872.2 $ 5,997.2 $ 91.0 $ 8,504.8 Land, buildings and Machinery Projects leasehold and Telecommunication under improvements equipment networks development Total Accumulated depreciation and impairment losses Balance as of December 31, 2016 $ 200.0 $ 1,088.3 $ 3,028.0 $ — $ 4,316.3 Depreciation 18.4 199.1 384.0 — 601.5 Retirement, disposals and other 1 3.3 (65.7) (97.6) — (160.0) Balance as of December 31, 2017 221.7 1,221.7 3,314.4 — 4,757.8 Depreciation 18.8 191.8 401.8 — 612.4 Reclassification to assets held for sale (11.5) — — — (11.5) Retirement, disposals and other 1 (2.6) (33.6) (231.2) — (267.4) As of December 31, 2018 $ 226.4 $ 1,379.9 $ 3,485.0 $ — $ 5,091.3 Net carrying amount As of December 31, 2017 $ 391.2 $ 529.5 $ 2,587.4 $ 46.2 $ 3,554.3 As of December 31, 2018 $ 318.0 $ 492.3 $ 2,512.2 $ 91.0 $ 3,413.5 1 Includes also the net change in assets related to discontinued operations. In 2017, the calculation of the depreciation of a component of the Corporation’s telecommunication networks was changed in order to depreciate it over its useful life of 5 years, compared with 15 years previously. As a result, depreciation was increased by $21.0 million in 2017. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2018 | |
INTANGIBLE ASSETS | |
INTANGIBLE ASSETS | 14. NTANGIBLE ASSETS For the years ended December 31, 2018 and 2017, changes in the net carrying amount of intangible assets are as follows: Customer Broadcasting relationships, licences, naming trademarks Projects Spectrum rights and and sport under licences Software other franchises development Total Cost Balance as of December 31, 2016 $ 1,006.9 $ 811.0 $ 121.1 $ 120.1 $ 25.1 $ 2,084.2 Additions — 77.7 2.4 — 61.8 141.9 Net change in additions financed with accounts payable — 13.9 — — 12.3 26.2 Reclassification — 32.1 — — (32.1) — Retirement, disposals and other (note 6) (283.4) (7.6) (2.8) — (2.3) (296.1) Balance as of December 31, 2017 723.5 927.1 120.7 120.1 64.8 1,956.2 Additions — 100.9 2.6 — 93.9 197.4 Net change in additions financed with accounts payable — (3.5) — — 68.1 64.6 Reclassification to assets held for sale — — (5.1) — — (5.1) Reclassification — 50.4 — — (50.4) — Retirement, disposals and other — (7.2) 1.2 (8.0) (9.6) (23.6) Balance as of December 31, 2018 $ 723.5 $ 1,067.7 $ 119.4 $ 112.1 $ 166.8 $ 2,189.5 Customer Broadcasting relationships, licences, naming trademarks Projects Spectrum rights and and sport under licences Software other franchises development Total Accumulated amortization and impairment losses Balance as of December 31, 2016 $ 247.7 $ 461.8 $ 48.1 $ 102.6 $ — $ 860.2 Amortization — 93.0 10.8 — — 103.8 Impairment losses (note 7) — 1.4 4.4 8.0 — 13.8 Retirement, disposals and other — (2.9) (1.8) — — (4.7) Balance as of December 31, 2017 247.7 553.3 61.5 110.6 — 973.1 Amortization — 96.5 9.0 — — 105.5 Reclassification to assets held for sale — — (3.5) — — (3.5) Retirement, disposals and other — (9.9) (3.0) (8.0) — (20.9) Balance as of December 31, 2018 $ 247.7 $ 639.9 $ 64.0 $ 102.6 $ — $ 1,054.2 Net carrying amount As of December 31, 2017 $ 475.8 $ 373.8 $ 59.2 $ 9.5 $ 64.8 $ 983.1 As of December 31, 2018 $ 475.8 $ 427.8 $ 55.4 $ 9.5 $ 166.8 $ 1,135.3 The cost of internally generated intangible assets, mainly composed of software, was $593.0 million as of December 31, 2018 ($566.5 million as of December 31, 2017). For the year ended December 31, 2018, the Corporation recorded additions of internally generated intangible assets of $43.4 million ($70.5 million in 2017 and $66.0 million in 2016). The accumulated amortization and impairment losses on internally generated intangible assets, mainly composed of software, was $360.6 million as of December 31, 2018 ($323.3 million as of December 31, 2017). For the year ended December 31, 2018, the Corporation recorded $40.7 million in amortization on its internally generated intangible assets ($44.9 million in 2017 and $43.8 million in 2016). The net carrying value of internally generated intangible assets was $232.4 million as of December 31, 2018 ($243.2 million as of December 31, 2017). Spectrum licences are allocated to the Telecommunications CGU, broadcasting licences are allocated to the Broadcasting CGU, trademarks are allocated to the Telecommunications and Magazines CGUs, while sport franchises are allocated to the Sports and Entertainment CGU. |
GOODWILL
GOODWILL | 12 Months Ended |
Dec. 31, 2018 | |
GOODWILL | |
GOODWILL | 15. GOODWILL For the years ended December 31, 2018 and 2017, changes in the net carrying amount of goodwill are as follows: 2018 2017 Cost Balance at beginning of year $ 5,688.6 $ 5,688.2 Business acquisitions 2.1 0.4 Reclassification to assets held for sale (19.6) — Balance at end of year 5,671.1 5,688.6 Accumulated impairment losses Balance at beginning of year 2,992.8 2,962.8 Impairment losses (note 7) — 30.0 Balance at end of year 2,992.8 2,992.8 Net carrying amount $ 2,678.3 $ 2,695.8 The net carrying amount of goodwill as of December 31, 2018 and 2017 was allocated to the following significant CGU groups: 2018 2017 CGU groups Telecommunications $ 2,656.1 $ 2,677.0 Other 1 22.2 18.8 Total $ 2,678.3 $ 2,695.8 1 Includes mainly the CGUs related to Speciality film and television services, Book publishing and distribution, and Sports and Entertainment. Recoverable amounts CGU recoverable amounts were determined based on the higher of a value in use or a fair value less costs of disposal with respect to the impairment tests performed. The Corporation uses the discounted cash flow method to estimate the recoverable amount, consisting of future cash flows derived primarily from the most recent budget and three‑year strategic plan approved by the Corporation’s management and presented to the Board of Directors. These forecasts considered each CGU’s past operating performance and market share as well as economic trends, along with specific and market industry trends and corporate strategies. In particular, specific assumptions are used for each type of revenue generated by a CGU or for each nature of expenses, as well as for future capital expenditures. Such assumptions will consider, among many other factors, subscribers, readership and viewer statistics, advertising market trends, competitive landscape, evolution of products and services offerings, wireless penetration growth, proliferation of media platforms, technology evolution, broadcast programming strategy, bargaining agreements, Canadian GDP rates, and operating cost structures. A perpetual growth rate is used for cash flows beyond the three-year strategic plan period. The discount rate used by the Corporation is a pre-tax rate derived from the weighted average cost of capital pertaining to each CGU, which reflects the current market assessment of (i) the time value of money, and (ii) the risk specific to the assets for which the future cash flow estimates have not been risk-adjusted. The perpetual growth rate was determined with regard to the specific markets in which the CGUs participate. In certain circumstances, the Corporation can also estimate the fair value less cost of disposal with a market approach that consists of estimating the recoverable amount by using multiples of operating performance of comparable entities, transaction metrics and other financial information available, instead of primarily using the discounted cash flow method. The following key assumptions were used to determine recoverable amounts in the most recent impairment tests performed on the Corporation’s significant CGU groups: 2018 2017 Pre-tax Perpetual Pre-tax Perpetual discount rate growth discount rate growth CGU groups 1 (WACC) rate (WACC) rate Telecommunications 9.0 % 2.5 % 8.5 % 2.5 % Magazines — — 15.5 (2.0) Other 11.5 to 16.50 0.0 to 2.0 12.0 to 16.5 0.0 to 2.0 1 In 2018 and 2017, the recoverable amounts of all CGUs were based on value in use, using the discounted cash flow method. Sensitivity of recoverable amounts No reasonable changes in the discount rate or in the perpetual growth rate used in the most recent test performed would have caused the recoverable amount of the Telecommunication CGU to equal its carrying value. |
LOANS TO THE PARENT CORPORATION
LOANS TO THE PARENT CORPORATION | 12 Months Ended |
Dec. 31, 2018 | |
LOANS TO THE PARENT CORPORATION | |
LOANS TO THE PARENT CORPORATION | 16. LOANS TO THE PARENT CORPORATION On April 3, 2018, Quebecor entered into loan agreements with the Corporation pursuant to which the Corporation makes available to Quebecor, by way of one or multiple drawdowns, a $75.0 million non-revolving unsubordinated and unsecured loan and a $75.0 million non-revolving subordinated and unsecured loan. The unsubordinated and subordinated loans bear interest at a rate of 5.25% and 5.50%, respectively, and mature in April 2021. As of December 31, 2018, Quebecor drew down the full amount of $75.0 million on the unsubordinated loan agreement and the full amount of $75.0 million on the subordinated loan agreement. On June 29, 2018, Quebecor entered into a loan agreement with the Corporation pursuant to which the Corporation makes available to Quebecor, by way of one or multiple drawdowns, a $262.0 million non-revolving subordinated and unsecured loan, bearing interest at a rate of 5.50% and maturing in June 2021. As of December 31, 2018, Quebecor drew down the full amount of $262.0 million on the subordinated loan agreement. On July 23, 2018, Quebecor entered into a loan agreement with the Corporation pursuant to which the Corporation makes available to Quebecor, by way of one or multiple drawdowns, a $87.1 million non-revolving subordinated and unsecured loan, bearing interest at a rate of 5.50% and maturing in July 2021. As of December 31, 2018, Quebecor drew down the full amount of $87.1 million on the subordinated loan agreement. On September 28, 2018, Quebecor entered into a loan agreement with the Corporation pursuant to which the Corporation makes available to Quebecor, by way of one or multiple drawdowns, a $175.0 million non-revolving subordinated and unsecured loan, bearing interest at a rate of 5.75% and maturing in September 2021. As of December 31, 2018, Quebecor drew down $97.0 million on the subordinated loan agreement. |
OTHER ASSETS
OTHER ASSETS | 12 Months Ended |
Dec. 31, 2018 | |
OTHER ASSETS | |
OTHER ASSETS | 17. OTHER ASSETS 2018 2017 (restated, note 1(b)) Contract assets 1 $ 204.9 $ 183.6 Contract costs 2 103.0 102.9 Programs, broadcast and distribution rights 120.3 121.4 Other 48.4 44.1 476.6 452.0 Less current portion of contract assets (144.4) (132.8) Less current portion of contract costs (included in “Other current assets”) (53.4) (55.9) Less current portion of program, broadcast and distribution rights (included in “Inventories”) (77.3) (78.3) $ 201.5 $ 185.0 1 Impairment loss on contract assets resulting from mobile contracts being cancelled prior their initial term amounted to $25.8 million in 2018 ($16.1 million in 2017 and $12.0 million in 2016), net of the early termination penalty charged to the customer. In current and comparative periods, there were no significant cumulative catch-up adjustments to revenue that affected the corresponding contract asset, including adjustments arising from a change in an estimate of the transaction price or a contract modification. There were also no significant changes in the time frame for a performance obligation to be satisfied. 2 Amortization amounted to $63.2 million in 2018 ($59.4 million in 2017 and $51.0 million in 2016). |
ACCOUNTS PAYABLE AND ACCRUED CH
ACCOUNTS PAYABLE AND ACCRUED CHARGES | 12 Months Ended |
Dec. 31, 2018 | |
ACCOUNTS PAYABLE AND ACCRUED CHARGES | |
ACCOUNTS PAYABLE AND ACCRUED CHARGES | 18. ACCOUNTS PAYABLE AND ACCRUED CHARGES 2018 2017 Trade and accruals $ 612.7 $ 512.2 Salaries and employee benefits 139.0 144.0 Interest payable 49.9 49.6 Stock-based compensation 18.9 19.8 $ 820.5 $ 725.6 |
PROVISIONS AND CONTINGENCIES
PROVISIONS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2018 | |
PROVISIONS AND CONTINGENCIES | |
PROVISIONS AND CONTINGENCIES | 19. PROVISIONS AND CONTINGENCIES Contingencies, Restructuring legal disputes of operations and other Total Balance as of December 31, 2017 $ 5.9 $ 38.8 $ 44.7 Recognized in income 14.9 3.5 18.4 Payments (13.8) (1.7) (15.5) Other — 0.9 0.9 Balance as of December 31, 2018 $ 7.0 $ 41.5 $ 48.5 Current portion $ 4.8 $ 23.7 $ 28.5 Non-current portion (included in “Other liabilities”) 2.2 17.8 20.0 The recognition of provisions, in terms of both timing and amounts, requires the exercise of judgment based on relevant circumstances and events that can be subject to change over time. Provisions are primarily comprised of the following: Restructuring of operations Provisions for restructuring activities primarily cover severance payments related to initiatives to eliminate positions. Contingencies and legal disputes There are a number of legal proceedings against the Corporation that are pending. In the opinion of the management of the Corporation, the outcome of those proceedings is not expected to have a material adverse effect on the Corporation’s results or on its financial position. Management of the Corporation, after taking legal advice, has established provisions for specific claims or actions considering the facts of each case. The Corporation cannot determine when and if any payment will be made related to those provisions. Other Other provisions are principally related to decommissioning obligations. |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2018 | |
LONG-TERM DEBT | |
LONG-TERM DEBT | 20. LONG-TERM DEBT Effective interest rate as of December 31, 2018 2018 2017 Quebecor Media Bank credit facilities (i) 4.87 % $ 451.7 $ 420.4 Senior Notes (ii) 1,659.2 1,568.5 2,110.9 1,988.9 Videotron (iii) Bank credit facilities (iv) 3.24 % 742.0 5.4 Senior Notes (ii) 3,502.4 3,289.2 4,244.4 3,294.6 TVA Group (iii) Bank credit facilities (v) 3.79 % 52.9 62.9 Other — 0.3 Total long-term debt 6,408.2 5,346.7 Change in fair value related to hedged interest rate risk 2.5 5.8 Financing fees, net of amortization (35.7) (40.8) (33.2) (35.0) 6,375.0 5,311.7 Less current portion (56.6) (19.1) $ 6,318.4 $ 5,292.6 (i) The bank credit facilities of Quebecor Media are comprised of a US$350.0 million secured term loan “B” facility that matures in August 2020 and is bearing interest at U.S London Interbank Offered Rate (“LIBOR”) plus a premium of 2.25% and a $300.0 million secured revolving credit facility that matures in July 2020 and is bearing interest at Bankers’ acceptance rate, LIBOR, Canadian prime rate or U.S. prime rate, plus a premium determined by a leverage ratio. The term loan “B” facility provides for quarterly amortization payments totaling 1.00% per annum of the original principal amount, with the balance payable on August 17, 2020. These credit facilities contain covenants such as maintaining certain financial ratios, limitations on the Corporation’s ability to incur additional indebtedness, pay dividends, and make other distributions. They are secured by liens on all of the movable property and assets of the Corporation (primarily shares of its subsidiaries), now owned or hereafter acquired. As of December 31, 2018, the credit facilities were secured by assets with a carrying value of $1,707.0 million ($3,045.4 million in 2017). As of December 31, 2018 and 2017, no amount had been drawn on the revolving credit facility, and as of December 31, 2018, $451.7 million was outstanding on the term loan “B” ( $420.4 million in 2017). On February 15, 2019, Quebecor Media amended its $300.0 million secured revolving credit facility to extend the maturity date to July 2022 and to change certain conditions and terms of the facility. (ii) The Senior Notes are unsecured and contain certain restrictions on the respective issuers, including limitations on their ability to incur additional indebtedness, pay dividends, or make other distributions. Some Notes are redeemable at the option of the issuer, in whole or in part, at a price based on a make-whole formula during the first five years of the term of the Notes and at a decreasing premium thereafter, while the remaining Notes are redeemable at a price based on a make‑whole formula at any time prior to maturity. The Senior Notes issued by Videotron are guaranteed by specific subsidiaries of Videotron. The following table summarizes the terms of the outstanding Senior Notes as of December 31, 2018: Effective interest rate (after discount or Annual nominal premium at Interest payable Principal amount interest rate issuance) Maturity date every 6 months on Quebecor Media US$ 850.0 5.750 % 5.750 % January 15, 2023 June and December 15 $ 500.0 6.625 % 6.625 % January 15, 2023 June and December 15 Videotron US$ 800.0 5.000 % 5.000 % July 15, 2022 January and July 15 US$ 600.0 5.375 % 5.375 % June 15, 2024 June and December 15 $ 400.0 5.625 % 5.625 % June 15, 2025 April and October 15 $ 375.0 5.750 % 5.750 % January 15, 2026 March and September 15 US$ 600.0 1 5.125 % 5.125 % April 15, 2027 April and October 15 1 The Notes were issued in April 2017 for net proceeds of $794.5 million, net of financing fees of $9.9 million. (iii) The debts of these subsidiaries are non-recourse to Quebecor Media. (iv) The bank credit facility provides for a $1,500.0 million ($965.0 million in 2017) secured revolving credit facility that matures in July 2023. The revolving credit facility bears interest at Bankers’ acceptance rate, LIBOR, Canadian prime rate or U.S. prime rate, plus a margin, depending on Videotron’s leverage ratio. The bank credit facility is secured by a first ranking hypothec on the universality of all tangible and intangible assets, current and future, of Videotron and most of its wholly owned subsidiaries. As of December 31, 2018, the bank credit facility was secured by assets with a carrying value of $7,639.2 million ($6,665.7 million in 2017). The bank credit facility contains covenants such as maintaining certain financial ratios, limitations on Videotron’s ability to incur additional indebtedness, pay dividends, or make other distributions. As of December 31, 2018, $742.0 million had been drawn on the secured revolving credit facility (no amount was drawn in 2017, while $5.4 million was outstanding in 2017 on an export financing facility that matured in June 2018). In December 2018, Videotron entered into new unsecured on demand credit facilities, under which letters of credit were issued and filed with ISED Canada as pre-auction financial deposits in respect to its application to participate to the 600 MHz spectrum auction. Under ISED Canada published rules respecting restrictions on communications during the auction process, it is strictly forbidden for the Corporation to disclose the amount of the letters of credit, which can be withdrawn by Videotron at anytime prior to the auction commencement. (v) The bank credit facilities of TVA Group comprise a secured revolving credit facility in the amount of $150.0 million, maturing in February 2019, and a secured term loan in the amount of $75.0 million, maturing in November 2019. TVA Group’s revolving credit facility bears interest at floating rates based on Bankers’ acceptance rate, LIBOR, Canadian prime rate or U.S. prime rate, plus a premium determined by a leverage ratio. The term loan bears interest at floating rates based on Bankers’ acceptance rate or Canadian prime rate, plus a premium determined by a leverage ratio. The term loan provides for quarterly amortization payments commencing on December 20, 2015. The bank credit facilities contain covenants such as maintaining certain financial ratios, limitations on TVA Group’s ability to incur additional indebtedness, pay dividends, or make other distributions. They are secured by liens on all of its movable assets and an immovable hypothec on its Head Office building. As of December 31, 2018 and 2017, no amount had been drawn on the revolving credit facility, and as of December 31, 2018, $52.9 million was outstanding on the term loan ($62.9 million in 2017). On February 13, 2019, TVA Group amended its $150.0 million secured revolving credit facility to extend the maturity date to February 2020 and to change certain conditions and terms of the facility. On December 31, 2018, the Corporation was in compliance with all debt covenants. Principal repayments of long-term debt over the coming years are as follows: 2019 $ 56.6 2020 448.1 2021 — 2022 1,091.0 2023 2,401.2 2024 and thereafter 2,411.3 |
OTHER LIABILITIES
OTHER LIABILITIES | 12 Months Ended |
Dec. 31, 2018 | |
OTHER LIABILITIES | |
OTHER LIABILITIES | 21. OTHER LIABILITIES Note 2018 2017 Defined benefit plans $ 153.9 $ 136.9 Deferred revenues 14.6 17.4 Stock-based compensation 1 12.2 8.3 Other 32.6 32.4 $ 213.3 $ 195.0 1 The current $18.9 million portion of stock-based compensation is included in accounts payable and accrued charges ($19.8 million in 2017) (note 18). |
CAPITAL STOCK
CAPITAL STOCK | 12 Months Ended |
Dec. 31, 2018 | |
CAPITAL STOCK | |
CAPITAL STOCK | 22. CAPITAL STOCK (a) Authorized capital stock An unlimited number of Common Shares, without par value; An unlimited number of non-voting Cumulative First Preferred Shares, without par value; the number of preferred shares in each series and the related characteristics, rights and privileges are determined by the Board of Directors prior to each issue: · An unlimited number of Cumulative First Preferred Shares, Series A (“Preferred A Shares”), carrying a 12.5% annual fixed cumulative preferential dividend, redeemable at the option of the holder and retractable at the option of the Corporation; · An unlimited number of Cumulative First Preferred Shares, Series B (“Preferred B Shares”), carrying a fixed cumulative preferential dividend generally equivalent to the Corporation’s credit facility interest rate, redeemable at the option of the holder and retractable at the option of the Corporation; · An unlimited number of Cumulative First Preferred Shares, Series C (“Preferred C Shares”), carrying an 11.25% annual fixed cumulative preferential dividend, redeemable at the option of the holder and retractable at the option of the Corporation; · An unlimited number of Cumulative First Preferred Shares, Series D (“Preferred D Shares”), carrying an 11.0% annual fixed cumulative preferential dividend, redeemable at the option of the holder and retractable at the option of the Corporation; · An unlimited number of Cumulative First Preferred Shares, Series F (“Preferred F Shares”), carrying a 10.85% annual fixed cumulative preferential dividend, redeemable at the option of the holder and retractable at the option of the Corporation; · An unlimited number of Cumulative First Preferred Shares, Series G (“Preferred G Shares”), carrying a 10.85% annual fixed cumulative preferential dividend, redeemable at the option of the holder and retractable at the option of the Corporation; An unlimited number of non-voting Preferred Shares, Series E (“Preferred E Shares”), carrying a non‑cumulative dividend subsequent to the holders of Cumulative First Preferred Shares, redeemable at the option of the holder and retractable at the option of the Corporation. (b) Issued and outstanding capital stock Common Shares Number Amount Balance as of December 31, 2016 95,983,176 $ 3,701.4 Reduction of paid-up capital — (50.0) Redemption (541,899) (20.6) Balance as of December 31, 2017 95,441,277 3,630.8 Redemption (16,064,215) (611.1) Balance as of December 31, 2018 $ 3,019.7 On May 11 and June 22, 2018, Quebecor Media repurchased a total of 16,064,215 of its Common Shares held by CDP Capital d’Amérique Investissements inc. (“CDP Capital”), for a total aggregate purchase price of $1.54 billion, paid in cash. All repurchased shares were cancelled. The excess of $928.9 million of the purchase price over the carrying value of Common Shares repurchased were recorded in increase of the deficit. Cash on hand and drawings under the Videotron secured revolving credit facility were used to finance the Corporation Common Shares repurchase. On July 6, 2017, Quebecor Media repurchased and cancelled 541,899 of its Common Shares held by CDP Capital for an amount of $37.7 million. On the same day, Quebecor Media also paid off a security held by CDP Capital for an amount of $6.2 million. The $23.3 million excess of the shares repurchase value and the security payment over the carrying value of Common Shares repurchased was recorded as an increase of the deficit. In 2017, the Corporation reduced its paid-up capital for a total cash consideration of $50.0 million |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS | 12 Months Ended |
Dec. 31, 2018 | |
STOCK-BASED COMPENSATION PLANS | |
STOCK-BASED COMPENSATION PLANS | 23. STOCK-BASED COMPENSATION PLANS (a) Quebecor plans (i) Under a stock option plan established by the parent Corporation, 26,000,000 Quebecor Class B Shares have been set aside for directors, officers, senior employees, and other key employees of Quebecor and the Corporation. The exercise price of each option is equal to the weighted average trading price of Quebecor Class B Shares on the Toronto Stock Exchange over the last five trading days immediately preceding the granting of the option. Each option may be exercised during a period not exceeding 10 years from the date granted. As per the provisions of the plan, options usually vest as follows: 1/3 after one year, 2/3 after two years, and 100% three years after the original grant. The Board of Directors of the parent Corporation may, at its discretion, affix different vesting periods at the time of each grant. Holders of options under the stock option plan have the choice, when they exercise their options, of acquiring the Class B Shares at the corresponding option exercise price, or receiving a cash payment equivalent to the difference between the market value of the underlying shares and the exercise price of the option. Holders of options have committed to obtain the consent of the parent corporation before exercising their right to subscribe the shares for which they exercise their options. The following table gives details on changes to outstanding options for the years ended December 31, 2018 and 2017: 2018 2017 Weighted Weighted average average Options exercise price Options exercise price Balance at beginning of year 440,000 $ 12.31 1,360,000 $ 12.69 Granted 1,242,892 26.52 — — Exercised (100,000) 12.75 (630,000) 12.82 Cancelled (20,000) 26.52 (290,000) 12.97 Balance at end of year 1,562,892 23.40 440,000 12.31 Vested options at end of year 340,000 $ 12.17 376,666 $ 12.04 During the year ended December 31, 2018, 100,000 stock options of Quebecor were exercised for a cash consideration of $1.2 million (630,000 stock options for $4.7 million in 2017). The following table gives summary information on outstanding options as of December 31, 2018: Outstanding options Vested options Weighted Weighted Weighted Range of average years average average exercise price Number to maturity exercise price Number exercise price $ 11.11 to 15.12 340,000 4.78 $ 12.17 340,000 $ 12.17 $ 26.52 1,222,892 9.78 26.52 — — $ 11.11 to 26.52 1,562,892 7.28 $ 23.40 340,000 $ 12.17 (ii) Under a mid-term stock-based compensation plan, participants are entitled to receive a cash payment at the end of a three-year period based on the appreciation of Quebecor Class B Share price, and subject to the achievement of certain non-market performance criteria. All the 93,610 units outstanding as of December 31, 2017 were exercised in 2018 for a cash consideration of $0.8 million (1,140,941 units for a cash consideration of $4.9 million in 2017). (iii) The Quebecor DSU plan is for the benefit of Quebecor and the Corporation’s directors. Under this plan, each director receives a portion of his/her compensation in the form of DSUs, such portion representing at least 50% of the annual retainer which could be less upon reaching the minimum shareholding threshold set out in the policy regarding the minimum shareholding by directors. Subject to certain conditions, each director may elect to receive up to 100% of the total fees payable for services as a director in the form of units. The value of a DSU is based on the weighted average trading price of Quebecor Class B Shares on the Toronto Stock Exchange over the last five trading days immediately preceding the relevant date. DSUs will entitle the holders thereof to dividends, which will be paid in the form of additional units at the same rate as that applicable to dividends paid from time to time on Quebecor Class B Shares. Subject to certain limitations, the DSUs will be redeemed by the Corporation when the director ceases to serve as a director of the Corporation. For the purpose of redeeming units, the value of a DSU shall correspond to the fair market value of Quebecor Class B Shares on the date of redemption. As of December 31, 2018 and 2017, the total number of DSUs outstanding under this plan was 108,885 and 89,397, respectively. (b) Quebecor Media stock option plan Under a stock option plan established by the Corporation, 6,180,140 Common Shares of Quebecor Media have been set aside for officers, senior employees, directors, and other key employees of Quebecor Media. Each option may be exercised within a maximum period of 10 years following the date of grant at an exercise price not lower than, as the case may be, the fair market value of the Common Shares of Quebecor Media at the date of grant, as determined by its Board of Directors (if the Common Shares of Quebecor Media are not listed on a stock exchange at the time of the grant), or the five‑day weighted average market price ending on the day preceding the date of grant of the Common Shares of the Corporation on the stock exchange(s) where such shares are listed at the time of grant. As long as the Common Shares of Quebecor Media are not listed on a recognized stock exchange, optionees may exercise their vested options during one of the following periods: from March 1 to March 30, from June 1 to June 29, from September 1 to September 29, and from December 1 to December 30. Holders of options under the plan have the choice at the time of exercising their options of receiving an amount in cash (equal to the difference between either the five‑day weighted average market price ending on the day preceding the date of exercise of the Common Shares of the Corporation on the stock exchange(s) where such shares are listed at the time of exercise, or the fair market value of the Common Shares, as determined by the Corporation’s Board of Directors, and the exercise price of their vested options) or, subject to certain stated conditions, exercise their options to purchase Common Shares of Quebecor Media at the exercise price. Except under specific circumstances, and unless the Human Resources and Corporate Governance Committee decides otherwise, options vest over a five‑year period in accordance with one of the following vesting schedules as determined by the Human Resources and Corporate Governance Committee at the time of grant: (i) equally over five years with the first 20% vesting on the first anniversary of the date of the grant; (ii) equally over four years with the first 25% vesting on the second anniversary of the date of grant; and (iii) equally over three years with the first 33 1/3% vesting on the third anniversary of the date of grant. The following table gives details on changes to outstanding options granted as of December 31, 2018 and 2017: 2018 2017 Weighted Weighted average average Options exercise price Options exercise price Balance at beginning of year 595,827 $ 62.84 980,905 $ 61.71 Exercised (263,227) 60.31 (215,978) 59.40 Cancelled (14,200) 70.06 (169,100) 60.65 Balance at end of year 318,400 $ 64.61 595,827 $ 62.84 Vested options at end of year 170,500 $ 61.07 226,200 $ 58.78 During the year ended December 31, 2018, 263,227 of the Corporation’s stock options were exercised for a cash consideration of $10.7 million (215,978 stock options for $5.5 million in 2017). The following table gives summary information on outstanding options as of December 31, 2018: Outstanding options Vested options Weighted Weighted Weighted Range of average years average average exercise price Number to maturity exercise price Number exercise price $ 50.10 to 57.64 103,350 5.70 $ 56.05 40,500 $ 55.33 $ 63.50 to 70.56 215,050 5.30 67.88 130,000 68.29 $ 50.10 to 70.56 318,400 5.43 $ 64.61 170,500 $ 61.07 (c) TVA Group stock option plan Under this stock option plan, 2,200,000 TVA Group Class B Shares have been set aside for senior executives and directors of TVA Group and its subsidiaries. The terms and conditions of options granted are determined by TVA Group’s Human Resources and Corporate Governance Committee. The subscription price of an option cannot be less than the closing price of Class B Shares on the Toronto Stock Exchange the day before the option is granted. Unless the Human Resources and Corporate Governance Committee decides otherwise, options vest over a five‑year period in accordance with one of the following vesting schedules as determined by the Human Resources and Corporate Governance Committee at the time of grant: (i) equally over five years with the first 20% vesting on the first anniversary of the date of the grant; (ii) equally over four years with the first 25% vesting on the second anniversary of the date of grant; and (iii) equally over three years with the first 33 1/3% vesting on the third anniversary of the date of grant. The term of an option cannot exceed 10 years. Holders of options under the plan have the choice, at the time of exercising their options, of receiving a cash payment from TVA Group equal to the number of shares corresponding to the options exercised, multiplied by the difference between the market value of the TVA Group Class B Shares and the exercise price of the option or, subject to certain conditions, exercise their options to purchase TVA Group Class B Shares at the exercise price. The market value is defined as the average closing market price of the TVA Group Class B Shares for the last five trading days preceding the date on which the option was exercised. Holders of options have committed to obtain the consent of TVA Group before exercising their right to subscribe the shares for which they exercise their options. The following table gives details on changes to outstanding options for the years ended December 31, 2018 and 2017: 2018 2017 Weighted Weighted average average Options exercise price Options exercise price Balance at beginning of year 60,000 $ 6.85 357,632 $ 12.71 Granted 280,000 2.16 — — Cancelled — — (134,915) 12.86 Expired — — (162,717) 14.75 Balance at end of year 340,000 $ 2.99 60,000 $ 6.85 Vested options at end of year 36,000 $ 6.85 24,000 $ 6.85 As of December 31, 2018, exercise prices of all outstanding options are from $2.16 to $6.85 and the average of years to maturity is 9.1. (d) Deferred share unit and performance share unit plans On July 10, 2016, TVA Group established a DSU plan and a PSU plan for its employees based on TVA Group Class B Shares. The DSUs vest over six years and will be redeemed for cash only upon the participant’s retirement or termination of employment, as the case may be. The PSUs vest over three years and will be redeemed for cash at the end of this period subject to the achievement of financial targets. DSUs and PSUs entitle the holders to receive additional units when dividends are paid on TVA Group Class B Shares. No treasury shares will be issued for the purposes of these plans. On July 13, 2016, Quebecor also established a DSU plan and a PSU plan for its employees and those of its subsidiaries. Both plans are based on Quebecor Class B Shares and, in the case of the DSU plan, also on TVA Group Class B Shares. The DSUs vest over six years and will be redeemed for cash only upon the participant’s retirement or termination of employment, as the case may be. The PSUs vest over three years and will be redeemed for cash at the end of this period subject to the achievement of financial targets. DSUs and PSUs entitle the holders to receive additional units when dividends are paid on Quebecor Class B Shares or TVA Group Class B Shares. No treasury shares will be issued for the purposes of these plans. As of December 31, 2018, 143,860 DSUs based on Quebecor Class B Shares, 244,140 DSUs based on TVA Group Class B Shares, 215,336 PSUs based on Quebecor Class B Shares and 270,637 PSUs based on TVA Group Class B Shares were outstanding under these plans. (e) Assumptions in estimating the fair value of stock-based awards The fair value of stock-based awards under the stock option plans of the parent corporation, Quebecor Media and TVA Group was estimated using the Black-Scholes option pricing model. The following weighted-average assumptions were used to estimate the fair value of all outstanding stock options under the stock option plans as of December 31, 2018 and 2017: December 31, 2018 Quebecor Quebecor Media TVA Group Risk-free interest rate 2.05 % 1.97 % 2.06 % Distribution yield 0.77 % 1.13 % — % Expected volatility 17.93 % 16.11 % 47.07 % Expected remaining life 4.8 years 1.5 years 5.2 years December 31, 2017 Quebecor Quebecor Media TVA Group Risk-free interest rate 1.83 % 1.80 % 1.97 % Distribution yield 0.46 % 1.12 % — % Expected volatility 17.58 % 16.70 % 50.78 % Expected remaining life 2.4 years 2.3 years 3.6 years Except for Quebecor Media, the expected volatility is based on the historical volatility of the underlying share price for a period equivalent to the expected remaining life of the options. Since the Common Shares of Quebecor Media are not publicly traded on a stock exchange, expected volatility is derived from the implied volatility of Quebecor’s stock. The expected remaining life of options granted represents the period of time that options granted are expected to be outstanding. The risk‑free rate over the expected remaining life of the option is based on the Government of Canada yield curve in effect at the time of the valuation. Distribution yield is based on the current average yield. (f) Liability of vested options As of December 31, 2018, the liability for all vested options was $14.2 million as calculated using the intrinsic value ($12.2 million as of December 31, 2017). (g) Consolidated stock-based compensation charge For the year ended December 31, 2018, a consolidated charge related to all stock‑based compensation plans was recorded in the amount of $15.6 million ($15.4 million in 2017 and $16.3 million in 2016). |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE LOSS | 12 Months Ended |
Dec. 31, 2018 | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | 24. ACCUMULATED OTHER COMPREHENSIVE LOSS Cash flow Defined hedges benefit plans Total Balance as of December 31, 2015 $ (71.1) $ (64.9) $ (136.0) Other comprehensive (loss) income (15.1) 21.6 6.5 Balance as of December 31, 2016 (86.2) (43.3) (129.5) Other comprehensive income (loss) 71.7 (2.6) 69.1 Balance as of December 31, 2017 (14.5) (45.9) (60.4) Other comprehensive loss (15.8) (5.1) (20.9) Balance as of December 31, 2018 $ (30.3) $ (51.0) $ (81.3) No significant amount is expected to be reclassified in income over the next 12 months in connection with derivative financial instruments designated as cash flow hedges. The balance is expected to reverse over a 8 1/4‑year period. |
COMMITMENTS
COMMITMENTS | 12 Months Ended |
Dec. 31, 2018 | |
COMMITMENTS | |
COMMITMENTS | 25. COMMITMENTS The Corporation rents premises and equipment under operating leases and has entered into long‑term commitments to purchase services, tangible and intangible assets, broadcasting rights, and to pay licences and royalties. Rent payments include an amount of $48.1 million for future payments to the parent corporation. The operating leases have various terms, escalation clauses, purchase options and renewal rights. The minimum payments for the coming years are as follows: Other Leases commitments 2019 $ 49.5 $ 247.4 2020 to 2023 94.8 648.4 2024 and thereafter 96.7 455.7 The Corporation’s operating lease expenses amounted to $66.6 million in 2018 ($68.1 million in 2017 and $67.1 million in 2016). |
GUARANTEES
GUARANTEES | 12 Months Ended |
Dec. 31, 2018 | |
GUARANTEES | |
GUARANTEES | 26. GUARANTEES In the normal course of business, the Corporation enters into numerous agreements containing guarantees, including the following: Operating leases The Corporation has guaranteed a portion of the residual value of certain assets under operating leases for the benefit of the lessor. Should the Corporation terminate these leases prior to term (or at the end of the lease terms) and should the fair value of the assets be less than the guaranteed residual value, then the Corporation must, under certain conditions, compensate the lessor for a portion of the shortfall. In addition, the Corporation has provided guarantees to the lessor of certain premises leases with expiry dates through 2020. Should the lessee default under the agreement, the Corporation must, under certain conditions, compensate the lessor. As of December 31, 2018, the maximum exposure with respect to these guarantees was $19.3 million and no liability has been recorded in the consolidated balance sheets. Business and asset disposals In the sale of all or part of a business or an asset, in addition to possible indemnification relating to failure to perform covenants and breach of representations or warranties, the Corporation may agree to indemnify against claims related to the past conduct of the business. Typically, the term and amount of such indemnification will be limited by the agreement. The nature of these indemnification agreements prevents the Corporation from estimating the maximum potential liability it could be required to pay to guaranteed parties. The Corporation has not accrued any amount in respect of these items in the consolidated balance sheet. Outsourcing companies and suppliers In the normal course of its operations, the Corporation enters into contractual agreements with outsourcing companies and suppliers. In some cases, the Corporation agrees to provide indemnifications in the event of legal procedures initiated against them. In other cases, the Corporation provides indemnification to counterparties for damages resulting from the outsourcing companies and suppliers. The nature of the indemnification agreements prevents the Corporation from estimating the maximum potential liability it could be required to pay. No amount has been accrued in the consolidated balance sheet with respect to these indemnifications. Other One of the Corporation’s subsidiaries, has, as a franchiser, provided guarantees should franchisees, in their retail activities, default certain purchase agreements. The nature of the indemnification agreements prevents the Corporation from estimating the maximum potential liability it could be required to pay. No amount has been accrued in the consolidated balance sheet with respect to these guarantees. |
FINANCIAL INSTRUMENTS AND FINAN
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | 12 Months Ended |
Dec. 31, 2018 | |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | 27. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT The Corporation’s financial risk-management policies have been established in order to identify and analyze the risks faced by the Corporation, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk-management policies are reviewed regularly to reflect changes in market conditions and in the Corporation’s activities. The Corporation uses a number of financial instruments, mainly cash and cash equivalents, accounts receivable, contract assets, long-term investments, bank indebtedness, trade payables, accrued liabilities, long-term debt, and derivative financial instruments. As a result of its use of financial instruments, the Corporation is exposed to credit risk, liquidity risk and market risks relating to foreign exchange fluctuations and interest rate fluctuations. In order to manage its foreign exchange and interest rate risks, the Corporation uses derivative financial instruments (i) to set in CAN dollars future payments on debts denominated in U.S. dollars (interest and principal) and certain purchases of inventories and other capital expenditures denominated in a foreign currency, (ii) to achieve a targeted balance of fixed- and floating-rate debts, and (iii) to lock in the value of certain derivative financial instruments through offsetting transactions. The Corporation does not intend to settle its derivative financial instruments prior to their maturity as none of these instruments is held or issued for speculative purposes. (a) Description of derivative financial instruments (i) Foreign exchange forward contracts CAN dollar average exchange rate Notional Notional Maturity per one U.S. dollar amount sold amount bought Videotron Less than 1 year 1.3056 $ 165.6 US$ 126.8 (ii) Cross-currency interest rate swaps Hedging instrument CAN dollar Annual interest exchange rate on rate on notional interest and Period Notional amount in capital payments Hedged item covered amount CAN dollars per one U.S. dollar Quebecor Media 5.750% Senior Notes due 2023 2016 to 2023 US$ 431.3 7.27 % 0.9792 5.750% Senior Notes due 2023 2012 to 2023 US$ 418.7 6.85 % 0.9759 Term loan “B” 2013 to 2020 US$ 331.6 Bankers' % 1.0346 Videotron 5.000% Senior Notes due 2022 2014 to 2022 US$ 543.1 6.01 % 0.9983 5.000% Senior Notes due 2022 2012 to 2022 US$ 256.9 5.81 % 1.0016 5.375% Senior Notes due 2024 2014 to 2024 US$ 158.6 Bankers’ % 1.1034 5.375% Senior Notes due 2024 2017 to 2024 US$ 441.4 5.62 % 1.1039 5.125% Senior Notes due 2027 2017 to 2027 US$ 600.0 4.82 % 1.3407 US$ drawing on revolver facility 2018 to 2019 US$ 160.0 Bankers' % 1.3417 Certain cross-currency interest rate swaps entered into by the Corporation include an option that allows each party to unwind the transaction on a specific date at the then settlement amount. (b) Fair value of financial instruments In accordance with IFRS 13, Fair Value Measurement , the Corporation considers the following fair value hierarchy which reflects the significance of the inputs used in measuring its financial instruments: Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and Level 3: inputs that are not based on observable market data (unobservable inputs). The fair value of long-term debt is estimated based on quoted market prices when available or on valuation models using Level 1 and Level 2 inputs. When the Corporation uses valuation models, the fair value is estimated using discounted cash flows using year‑end market yields or the market value of similar instruments with the same maturity. The fair value of derivative financial instruments recognized in the consolidated balance sheets is estimated as per the Corporation’s valuation models. These models project future cash flows and discount the future amounts to a present value using the contractual terms of the derivative financial instrument and factors observable in external market data, such as period‑end swap rates and foreign exchange rates (Level 2 inputs). An adjustment is also included to reflect non‑performance risk impacted by the financial and economic environment prevailing at the date of the valuation in the recognized measure of the fair value of the derivative financial instruments by applying a credit default premium, estimated using a combination of observable and unobservable inputs in the market (Level 3 inputs), to the net exposure of the counterparty or the Corporation. Derivative financial instruments are classified as Level 2. The carrying value and fair value of long-term debt and derivative financial instruments as of December 31, 2018 and 2017 are as follows: 2018 2017 Carrying Fair Carrying Fair Asset (liability) value value value value Long-term debt 1 $ (6,408.2) $ (6,391.5) $ (5,346.7) $ (5,658.0) Derivative financial instruments 2 Foreign exchange forward contracts 6.7 6.7 (4.5) (4.5) Cross-currency interest rate swaps 880.3 880.3 562.2 562.2 1 The carrying value of long-term debt excludes adjustments to record changes in the fair value of long-term debt related to hedged interest risk and financing fees. 2 The fair value of derivative financial instruments designated as cash flow hedges is an asset position of $840.6 million as of December 31, 2018 ($525.7 million in 2017) and the fair value of derivative financial instruments designated as fair value hedges is an asset position of $46.4 million as of December 31, 2018 ($32.0 million in 2017). (c) Credit risk management Credit risk is the risk of financial loss to the Corporation if a customer or counterparty to a financial asset fails to meet its contractual obligations and arises principally from amounts receivable from customers, including contract assets. The carrying amounts of financial assets represent the maximum credit exposure. In the normal course of business, the Corporation continuously monitors the financial condition of its customers and reviews the credit history of each new customer. As of December 31, 2018, no customer balance represented a significant portion of the Corporation’s consolidated trade receivables. The Corporation is using the expected credit losses method to estimate its provision for credit losses, which considers the specific credit risk of its customers, the expected lifetime of its financial assets, historical trends and economic conditions As of December 31, 2018, the provision for expected credit losses represented 2.7% of the gross amount of accounts receivable and contract assets (2.9% as of December 31, 2017), while 11.7% of trade receivable were 90 days past their billing date (11.3% as of December 31, 2017) . The following table shows changes to the provision for expected credit losses for the years ended December 31, 2018 and 2017: 2018 2017 Balance at beginning of year $ 21.1 $ 28.1 Changes in expected credit losses charged to income 19.6 21.6 Write-off (20.2) (28.6) Balance at end of year $ 20.5 $ 21.1 The Corporation believes that its product lines and the diversity of its customer base are instrumental in reducing its credit risk, as well as the impact of fluctuations in product-line demand. The Corporation does not believe that it is exposed to an unusual level of customer credit risk. As a result of its use of derivative financial instruments, the Corporation is exposed to the risk of non‑performance by a third party. When the Corporation enters into derivative contracts, the counterparties (either foreign or Canadian) must have credit ratings at least in accordance with the Corporation’s risk-management policy and are subject to concentration limits. These credit ratings and concentration limits are monitored on an ongoing basis, but at least quarterly. (d) Liquidity risk management Liquidity risk is the risk that the Corporation will not be able to meet its financial obligations as they fall due or the risk that those financial obligations will have to be met at excessive cost. The Corporation manages this exposure through staggered debt maturities. The weighted average term of the Corporation’s consolidated debt was approximately 5.1 years as of December 31, 2018 (6.1 years as of December 31, 2017). The Corporation’s management believes that cash flows and available sources of financing should be sufficient to cover committed cash requirements for capital investments, working capital, interest payments, income tax payments, debt repayments, pension plan contributions, share repurchases, dividends or distributions to shareholders. The Corporation has access to cash flows generated by its subsidiaries through dividends (or distributions) and cash advances paid by its wholly owned subsidiaries. As of December 31, 2018, material contractual obligations related to financial instruments included capital repayment and interest on long‑term debt and obligations related to derivative financial instruments, less estimated future receipts on derivative financial instruments. These obligations and their maturities are as follows: Less than 5 years Total 1 year 1-3 years 3-5 years or more Bank indebtedness $ 24.3 $ 24.3 $ — $ — $ — Accounts payable and accrued charges 820.5 820.5 — — — Long-term debt 1 6,408.2 56.6 448.1 3,492.2 2,411.3 Interest payments 2 1,500.6 252.3 578.2 428.4 241.7 Derivative financial instruments 3 (892.7) 0.2 (105.1) (618.1) (169.7) Total $ 7,860.9 $ 1,153.9 $ 921.2 $ 3,302.5 $ 2,483.3 1 The carrying value of long-term debt excludes adjustments to record changes in the fair value of long-term debt related to hedged interest rate risk and financing fees. 2 Estimate of interest payable on long-term debt, based on interest rates, hedging of interest rates and hedging of foreign exchange rates as of December 31, 2018. 3 Estimated future receipts, net of future disbursements, on derivative financial instruments related to foreign exchange hedging. (e) Market risk Market risk is the risk that changes in market prices due to foreign exchange rates, interest rates and/or equity prices will affect the value of the Corporation’s financial instruments. The objective of market risk management is to mitigate and control exposures within acceptable parameters while optimizing the return on risk. Foreign currency risk Most of the Corporation’s consolidated revenues and expenses, other than interest expense on U.S.‑dollar‑denominated debt, purchases of set‑top boxes, handsets and cable modems and certain capital expenditures, are received or denominated in CAN dollars. A significant portion of the interest, principal and premium, if any, payable on its debt is payable in U.S. dollars. The Corporation has entered into transactions to hedge the foreign currency risk exposure on its U.S.‑dollar‑denominated debt obligations outstanding as of December 31, 2018, and to hedge its exposure on certain purchases of set‑top boxes, handsets, cable modems and capital expenditures. Accordingly, the Corporation’s sensitivity to variations in foreign exchange rates is economically limited. The estimated sensitivity on income and on other comprehensive income, before income taxes, of a variance of $0.10 in the year‑end exchange rate of a CAN dollar per one U.S. dollar used to calculate the fair value of financial instruments as of December 31, 2018 is as follows: Other comprehensive Increase (decrease) Income income Increase of $0.10 $ 1.3 $ 34.8 Decrease of $0.10 (1.3) (34.8) A variance of $0.10 in the 2018 average exchange rate of CAN dollar per one U.S. dollar would have resulted in a variance of $2.4 million on the value of unhedged purchase of goods and services and $4.4 million on the value of unhedged acquisitions of tangible and intangible assets in 2018. Interest rate risk Some of the Corporation’s bank credit facilities bear interest at floating rates based on the following reference rates: (i) Bankers’ acceptance rate, (ii) LIBOR, (iii) Canadian prime rate, and (iv) U.S. prime rate. The Senior Notes issued by the Corporation bear interest at fixed rates. The Corporation has entered into cross-currency interest rate swap agreements in order to manage cash flow risk exposure. As of December 31, 2018, after taking into account the hedging instruments, long‑term debt was comprised of 76.2% fixed-rate debt (87.7% in 2017) and 23.8% floating-rate debt (12.3% in 2017). The estimated sensitivity on interest payments, of a 100 basis‑point variance in the year‑end Canadian Bankers’ acceptance rate as of December 31, 2018 was $13.1 million. The estimated sensitivity on income and on other comprehensive income, before income taxes, of a 100 basis‑point variance in the discount rate used to calculate the fair value of financial instruments as of December 31, 2018, as per the Corporation’s valuation models, is as follows: Other comprehensive Increase (decrease) Income income Increase of 100 basis points $ (1.9) $ (28.1) Decrease of 100 basis points 1.9 28.1 (f) Capital management The Corporation’s primary objective in managing capital is to maintain an optimal capital base in order to support the capital requirements of its various businesses, including growth opportunities. In managing its capital structure, the Corporation takes into account the asset characteristics of its subsidiaries and planned requirements for funds, leveraging their individual borrowing capacities in the most efficient manner to achieve the lowest cost of financing. Management of the capital structure involves the issuance and repayment of debt, the repurchase of shares, the use of cash flows generated by operations, and the level of distributions to shareholders. The Corporation has not significantly changed its strategy regarding the management of its capital structure since the last financial year. The Corporation’s capital structure is composed of equity, bank indebtedness, long-term debt, derivative financial instruments, cash and cash equivalents and loans to the parent Corporation. The capital structure as of December 31, 2018 and 2017 is as follows: 2018 2017 Bank indebtedness $ 24.3 $ — Long-term debt 6,375.0 5,311.7 Derivative financial instruments (887.0) (557.7) Cash and cash equivalents (21.0) (864.9) Loans to the parent corporation (596.1) — Net liabilities 4,895.2 3,889.1 Equity $ 1,424.7 $ 2,545.0 The Corporation is not subject to any externally imposed capital requirements other than certain restrictions under the terms of its borrowing agreements, which relate, among other things, to permitted investments, inter‑corporation transactions, and the declaration and payment of dividends or other distributions. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2018 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | 28. RELATED PARTY TRANSACTIONS Compensation of key management personnel Key management personnel comprises members of the Board of Directors and key senior managers of the Corporation and its main subsidiaries. Their compensation is as follows: 2018 2017 2016 Salaries and short-term benefits $ 9.9 $ 9.1 $ 9.3 Share-based compensation 5.4 5.9 9.3 Other long-term benefits 1.2 8.5 1.3 $ 16.5 $ 23.5 $ 19.9 Operating transactions During the year ended December 31, 2018, the Corporation made purchases and incurred rent charges with the parent corporation and affiliated companies in the amount of $10.0 million ($9.2 million in 2017 and $9.0 million in 2016), which are included in purchase of goods and services. The Corporation made sales to an affiliated corporation in the amount of $2.8 million ($2.8 million in 2017 and $3.0 million in 2016). These transactions were accounted for at the consideration agreed between parties. Management arrangements The parent corporation has entered into management arrangements with the Corporation. Under these management arrangements, the parent corporation and the Corporation provide management services to each other on a cost‑reimbursement basis. The expenses subject to reimbursement include the salaries of the Corporation’s executive officers, who also serve as executive officers of the parent corporation. In 2018, the Corporation received an amount of $2.4 million, which is included as a reduction in employee costs ($2.2 million in 2017 and 2016), and incurred management fees of $2.5 million ($2.7 million in 2017 and $2.6 million in 2016) with shareholders. Tax transactions In 2018, the parent corporation transferred $54.2 million of non-capital losses (none in 2017 and $22.1 million in 2016) to the Corporation in exchange for a cash consideration of $13.9 million (none in 2017 and $5.6 million in 2016). These transactions were concluded on terms equivalent to those that prevail on an arm’s length basis and were accounted for at the consideration agreed between the parties. |
PENSION PLANS AND POSTRETIREMEN
PENSION PLANS AND POSTRETIREMENT BENEFITS | 12 Months Ended |
Dec. 31, 2018 | |
PENSION PLANS AND POSTRETIREMENT BENEFITS | |
PENSION PLANS AND POSTRETIREMENT BENEFITS | 29. PENSION PLANS AND POSTRETIREMENT BENEFITS The Corporation maintains various flat-benefit plans, various final-pay plans with indexation features from zero to 2%, as well as defined contribution plans. The Corporation also provides postretirement benefits to eligible retired employees. The Corporation’s pension plans are registered with a provincial or federal regulatory authority. The Corporation’s funding policy for its funded pension plans is to maintain its contribution at a level sufficient to cover benefits and to meet requirements of the applicable regulations and plan provisions that govern the funding of the plans. These provisions establish, among others, the future amortization payments when the funding ratio of the pension plans is insufficient as defined by the relevant provincial and federal laws. Payments are determined by an actuarial report performed by an independent company at least every three years or annually, according to the applicable laws and in accordance with plan provisions. By their design, the defined benefit plans expose the Corporation to the typical risks faced by defined benefit plans, such as investment performance, changes to the discount rates used to value the obligation, longevity of plan participants, and future inflation. The administration of the plans is assured by pension committees composed of members of the plans, members of the Corporation’s management and independent members or by the Corporation, in accordance with the provisions of each plan. Under the Corporation’s rules of governance, the approval and oversight of the defined benefit plan policies are performed at different levels through the pension committees, the Corporation’s management, or the Audit Committee. The risk management of pension plans is also performed under the leadership of these committees at various levels. The custody of securities and management of security transactions are assigned to trustees within a mandate given by the pension committees or the Corporation, as the case may be. Policies include those on investment objectives, risk-mitigation strategies and the mandate to hire investment fund managers and monitor their work and performance. The defined benefit pension plans are monitored on an ongoing basis to assess the benefit, funding and investment policies, financial status, and the Corporation’s funding requirement. The following tables show a reconciliation of the changes in the plans’ benefit obligations and the fair value of plan assets for the years ended December 31, 2018 and 2017: Pension benefits Postretirement benefits 2018 2017 2018 2017 Change in benefit obligations Benefit obligations at the beginning of the year $ 1,320.4 $ 1,274.9 $ 60.5 $ 73.4 Service costs 36.4 33.9 2.1 1.9 Interest costs 46.0 49.8 2.8 2.9 Plan participants’ contributions 11.1 11.5 — — Actuarial (gain) loss arising from: Financial assumptions (75.7) 82.1 20.5 5.4 Demographic assumptions — (8.6) (12.3) — Participant experience (1.1) 4.5 (0.5) (21.2) Benefits and settlements paid (55.1) (72.7) (1.7) (1.9) Plan transfer — (55.4) — — Other 1.2 0.4 — — Benefit obligations at the end of the year $ 1,283.2 $ 1,320.4 $ 71.4 $ 60.5 Change in plan assets Fair value of plan assets at the beginning of the year $ 1,267.3 $ 1,244.4 $ — $ — Actual return on plan assets (37.5) 106.5 — — Employer contributions 34.0 35.5 1.7 1.9 Plan participants’ contributions 11.1 11.5 — — Administrative fees (2.5) (2.5) — — Benefits and settlements paid (55.1) (72.7) (1.7) (1.9) Plan transfer — (55.4) — — Fair value of plan assets at the end of the year $ 1,217.3 $ 1,267.3 $ — $ — As of December 31, 2018, the weighted average duration of defined benefit obligations was 15.6 years (16.5 years in 2017). The Corporation expects future benefit payments of $64.0 million in 2019. The investment strategy for plan assets takes into account a number of factors, including the time horizon of the pension plans’ obligations and the investment risk. For each of the plans, an allocation range by asset class is developed, whereby a mix of equities and fixed-income investments is used to optimize the risk-return profile of plan assets and to mitigate asset-liability mismatch. Plan assets are comprised of: 2018 2017 Equity securities: Canadian 21.1 % 23.6 % Foreign 31.2 32.3 Debt securities 46.6 40.8 Other 1.1 3.3 100.0 % 100.0 % The fair value of equity and debt securities is based on quoted prices in an active market, while the fair value of other investments is not based on quoted prices in an active market. Where funded plans have a net defined benefit asset, the Corporation determines if potential reductions in future contributions are permitted by applicable regulations and by collective bargaining agreements. When a defined benefit asset is created, it cannot exceed the future economic benefit that the Corporation can expect to obtain from the asset. The future economic benefit represents the value of reductions in future contributions and expenses payable to the pension fund. It does not reflect gains that could be generated in the future that would allow reductions in contributions by the Corporation. When there is a minimum funding requirement, this could also limit the amounts recognized in the balance sheet. A minimum funding requirement represents the present value of amortization payments based on the most recent actuarial financing reports filed. The reconciliation of funded status to the net amount recognized in the consolidated balance sheets is as follows: Pension benefits Postretirement benefits 2018 2017 2018 2017 Benefit obligations $ (1,283.2) $ (1,320.4) $ (71.4) $ (60.5) Fair value of plan assets 1,217.3 1,267.3 — — Plan deficit (65.9) (53.1) (71.4) (60.5) Asset limit and minimum funding adjustment (16.0) (20.4) — — Net amount recognized 1 $ (81.9) $ (73.5) $ (71.4) $ (60.5) 1 The net liability recognized for 2018 is $153.9 million and is included in “Other Liabilities” (note 21) (an asset of $2.9 million was included in “Other assets” in 2017 and a liability of $136.9 million was included in “Other liabilities” in 2017). Components of re-measurements are as follows: Pension benefits Postretirement benefits 2018 2017 2016 2018 2017 2016 Actuarial gain (loss) on benefit obligations $ 76.8 $ (78.0) $ (20.1) $ (7.7) $ 15.8 $ (1.4) Actual return on plan assets, less interest income anticipated in the interest on the net defined benefit liability calculation (80.9) 59.1 51.8 — — — Asset limit and minimum funding adjustment 5.0 (0.1) 2.8 — — — Re-measurements gain (loss) recorded in other comprehensive income $ 0.9 $ (19.0) $ 34.5 $ (7.7) $ 15.8 $ (1.4) Components of the net benefit costs are as follows: Pension benefits Postretirement benefits 2018 2017 2016 2018 2017 2016 Employee costs: Service costs $ 36.4 $ 33.9 $ 34.9 $ 2.1 $ 1.9 $ 1.8 Administrative fees and other 3.7 3.0 3.0 — — — Interest on net defined benefit liability 3.4 2.9 3.9 2.8 2.9 2.8 Net benefit costs $ 43.5 $ 39.8 $ 41.8 $ 4.9 $ 4.8 $ 4.6 The expense related to defined contribution pension plans amounted to $19.8 million in 2018 ($17.6 million in 2017 and $16.8 million 2016). The expected employer contributions to the Corporation’s defined benefit pension plans and post-retirement benefit plans will be $32.6 million in 2019, based on the most recent financial actuarial reports filed (contributions of $35.7 million were paid in 2018). Assumptions The Corporation determines its assumption for the discount rate to be used for purposes of computing annual service and interest costs based on an index of high-quality corporate bond-yield and matched-funding yield curve analysis as of the measurement date. The actuarial assumptions used in measuring the Corporation’s benefit obligations as of December 31, 2018, 2017 and 2016 and current periodic benefit costs are as follows: Pension and postretirement benefits 2018 2017 2016 Benefit obligations Rates as of year-end: Discount rate 3.90 % 3.50 % 3.90 % Rate of compensation increase 3.00 3.00 3.00 Current periodic costs Rates as of preceding year-end: Discount rate 3.50 % 3.90 % 4.00 % Rate of compensation increase 3.00 3.00 3.00 The assumed average retirement age of participants used was of 62 years in 2018, 2017 and 2016. The assumed health care cost trend rate used in measuring the accumulated postretirement benefit obligations was 7.9% at the end of 2018. These costs, as per the estimate, are expected to decrease gradually over the next 10 years to 5.1% and to remain at that level thereafter. Sensitivity analysis An increase of 10 basis points in the discount rate would have decreased the pension benefits obligation by $17.4 million and the postretirement benefits obligation by $1.5 million as of December 31, 2018. There are limitations to this sensitivity analysis since it only considers the impacts of an increase of 10 basis points in the discount rate assumption without changing any other assumptions. No sensitivity analysis was performed on other assumptions as a similar change to those assumptions would not have a significant impact on the consolidated financial statements. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 12 Months Ended |
Dec. 31, 2018 | |
DISCONTINUED OPERATIONS | |
DISCONTINUED OPERATIONS | 30. DISCONTINUED OPERATIONS On January 24, 2019, Videotron sold its 4Degrees Inc. Colocation data centers operations for an amount of $261.6 million which was fully paid in cash at the date of transaction. The determination of the final proceeds from the sale is however subject to certain adjustments based on the realization of future conditions over a period of up to 10 years. Accordingly, an estimated gain on disposal of $118.0 million will be accounted for in the first quarter of 2019, while an amount of $53.0 million from the proceeds received at the date of transaction will be deferred in connection with the estimated present value of the future conditional adjustments. The amount deferred will be revaluated on a quarterly basis and any change will be recorded in income from discontinued operations. As a result of this transaction, tax benefits of $18.5 million, on previous years’ capital losses, were recognized in the consolidated statement of income in 2018. In 2017, a gain of $14.6 million, was accounted for mainly for digital credits in connection with the English-language newspaper operations sold in 2015. The results of operations and cash flows of these businesses were reclassified as discontinued operations in the consolidated statement of income and cash flows are as follows: 2018 2017 2016 Revenues $ 19.8 $ 19.7 $ 12.0 Expenses 14.6 14.8 10.6 Income taxes 1.4 1.3 0.4 Gain related to a business sold in 2015 — (14.6) — Income from discontinued operations $ 3.8 $ 18.2 $ 1.0 2018 2017 2016 Cash flows related to operating activities $ 10.4 $ 20.4 $ 3.3 Cash flows related to investing activities (1.9) (3.5) (53.1) Cash flows provided by (used in) discontinued operations $ 8.5 $ 16.9 $ (49.8) Components of assets and liabilities classified as held for sale in the consolidated balance sheet are as follows: 2018 Current assets $ 1.3 Property, plant and equipment 72.5 Intangible assets and goodwill 21.2 Assets held for sale 95.0 Current liabilities held for sale (6.6) Net assets held for sale $ 88.4 |
NON-CONSOLIDATED FINANCIAL STAT
NON-CONSOLIDATED FINANCIAL STATEMENTS OF THE CORPORATION | 12 Months Ended |
Dec. 31, 2018 | |
NON-CONSOLIDATED FINANCIAL STATEMENTS OF THE CORPORATION | |
NON-CONSOLIDATED FINANCIAL STATEMENTS OF THE CORPORATION | 31. NON-CONSOLIDATED FINANCIAL STATEMENTS OF THE CORPORATION The Corporation has access to the cash flows generated by its subsidiaries by way of distributions from its public subsidiaries and distributions and advances from its private subsidiaries. However, some of the Corporation’s subsidiaries have restrictions, based on contractual debt obligations and corporate solvency tests, regarding the amounts of distributions and advances that can be paid to the Corporation. The U.S Securities and Exchange Commission requires that the non-consolidated financial statements of the parent corporation be presented when its subsidiaries have restrictions that may limit the amount of cash that can be paid to the parent corporation. These non-consolidated and condensed financial statements, as prepared under IFRS, are shown below. Non-consolidated condensed statements of income and comprehensive income 2018 2017 2016 Revenues: Distributions in excess of the investments in subsidiaries $ 503.3 $ — $ — Dividends 113.0 295.0 282.0 Management fees 59.2 58.8 59.9 Interest on loans to the parent corporation 14.8 — — Other 64.5 49.5 52.4 754.8 403.3 394.3 General and administrative expenses 126.8 123.6 121.7 Depreciation and amortization 3.8 4.3 3.3 Financial expenses 106.1 130.3 138.9 Loss (gain) on valuation and translation of financial instruments 0.2 (0.7) — Loss on debt refinancing — 10.4 — Impairment and disposal of investments in subsidiaries — — 73.3 Loss on notes receivable from subsidiaries — — 14.8 Other 2.4 (10.9) 2.0 Income before income taxes 515.5 146.3 40.3 Income taxes (recovery) (5.3) 0.6 1.7 Net income 520.8 145.7 38.6 Other comprehensive (loss) gain (3.9) 22.8 (3.3) Comprehensive income $ 516.9 $ 168.5 $ 35.3 Non-consolidated and condensed statements of cash flows 2018 2017 2016 Cash flows related to operations Net income $ 520.8 $ 145.7 $ 38.6 Depreciation and amortization 3.8 4.3 3.3 Loss (gain) on valuation and translation of financial instruments 0.2 (0.7) — Amortization of financing costs and long-term debt discount 2.3 2.4 2.8 Loss on debt refinancing — 10.4 — Impairment and disposal of investments in subsidiaries — — 73.3 Loss on notes receivable from subsidiaries — — 14.8 Deferred income taxes (5.3) 2.5 1.8 Other 0.2 2.4 (0.3) Net change in non-cash balances related to operations 5.3 39.3 7.5 Cash flows provided by operations 527.3 206.3 141.8 Cash flows related to investing activities Net change in investments in subsidiaries 2,058.6 (8.5) (63.5) Acquisition of tax deductions from the parent corporation (13.9) — (14.0) Other (6.0) (8.5) 3.9 Cash flows provided by (used in) investing activities 2,038.7 (17.0) (73.6) Cash flows related to financing activities Net change in bank indebtedness 5.7 (2.5) (8.1) Net change under revolving facilities — — (2.8) Repayment of long-term debt (3.6) (336.7) (3.6) Settlement of hedging contracts (1.6) (1.6) 5.2 Repurchase of Common Shares (1,540.0) (43.9) — Repurchase of redeemable preferred shares issued to subsidiaries — — (430.0) Dividends and reduction of paid-up capital (100.0) (100.0) (100.0) Net change in subordinated loans from subsidiaries 2,322.0 66.0 (2,768.0) Net change in convertible obligations, subordinated loans and notes receivable – subsidiaries (2,664.0) 276.0 3,199.0 Net change in loans to the parent corporation (596.1) — — Net change in advances to or from subsidiaries (19.6) (15.4) 40.1 Cash flows used in financing activities (2,597.2) (158.1) (68.2) Net change in cash and cash equivalents (31.2) 31.2 — Cash and cash equivalents at the beginning of the year 31.2 — — Cash and cash equivalents at the end of the year $ — $ 31.2 $ — Non-consolidated and condensed balance sheets 2018 2017 Assets Current assets $ 144.2 $ 161.8 Investments in subsidiaries at cost 477.8 2,536.4 Advances to subsidiaries 48.9 35.7 Convertible obligations, subordinated loans and notes receivable – subsidiaries 2,813.0 149.0 Loans to the parent corporation 596.1 — Other assets 488.9 347.2 $ 4,568.9 $ 3,230.1 Liabilities and equity Current liabilities $ 87.6 $ 66.3 Long-term debt 2,098.9 1,974.8 Advances from subsidiaries 138.8 145.2 Other liabilities 37.6 36.7 Subordinated loan from subsidiaries 2,813.0 491.0 Equity attributable to shareholders (607.0) 516.1 $ 4,568.9 $ 3,230.1 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of presentation | (a) Basis of presentation The consolidated financial statements have been prepared in accordance with IFRS as issued by the International Accounting Standards Board (“IASB”). These consolidated financial statements have been prepared on a historical cost basis, except for certain financial instruments (note 1(k)), the liability related to stock-based compensation (note 1(v)) and the net defined benefit liability (note 1(w)), and they are presented in Canadian dollars (“CAN dollars”), which is the currency of the primary economic environment in which the Corporation operates (“functional currency”). Comparative figures for the years ended December 31, 2017 and 2016 have been restated to conform to the presentation adopted for the year ended December 31, 2018. |
Changes in accounting policies | (b) Changes in accounting policies (i) IFRS 9 – Financial Instruments On January 1, 2018, the Corporation adopted the new rules under IFRS 9, Financial Instruments, which simplify the measurement and classification of financial assets by reducing the number of measurement categories in IAS 39, Financial Instruments: Recognition and Measurement . The new standard also provides for a fair value option in the designation of a non-derivative financial liability and its related classification and measurement, as well as for a new hedge accounting model more closely aligned with risk-management activities undertaken by entities. Under the new rules, most of financial assets and liabilities of the Corporation are now classified as subsequently measured at amortized cost, except for derivative financial instruments, which are measured at fair value. The Corporation is also using the IFRS 9 expected credit losses method to estimate the provision for expected credit losses on its financial assets. The adoption of IFRS 9 had no impact on the consolidated financial statements. (ii) IFRS 15 – Revenue from Contracts with Customers On January 1, 2018, the Corporation adopted, on a fully retrospective basis, the new rules under IFRS 15, Revenue from Contracts with Customers , which specify how and when an entity should recognize revenue, and which also require the entity to provide users of financial statements with more informative disclosures. The standard provides a single, principles-based, five-step model to apply to each contract with a customer (note 1(f)). The adoption of IFRS 15 had significant impacts on the consolidated financial statements, mainly in the Telecommunications segment, with regard to the timing of the recognition of its revenues, the classification of its revenues, as well as the capitalization of costs, such as the costs to obtain a contract and connection costs. Under IFRS 15, the total consideration from a contract with multiple deliverables is now allocated to all performance obligations in the contract, based on the stand-alone selling price of each obligation, without being limited to a non-contingent amount. The Telecommunications segment provides mobile devices and services under contracts with multiple deliverables and for a fixed period of time. Under IFRS 15, promotional offers related to the sale of mobile devices, previously accounted for as a reduction in related equipment sales on activation, are now considered in the total consideration to be allocated to all performance obligations. Among other impacts, the adoption of IFRS 15 results in an increase in the revenue from the device sale and in a decrease in the mobile service revenue recognized over the contract term. The timing of the recognition of these revenues therefore changes under IFRS 15. However, the total revenue recognized over a contract term relating to all performance obligations within the contract remains the same as under the previous rules. The portion of revenues that is earned without having been invoiced is now presented as contract assets in the consolidated balance sheets, which asset is realized during the term of the contract. The long-term portion of contract assets is included in “Other assets” in the consolidated balance sheets. All other types of revenue have not been impacted by the adoption of IFRS 15. In addition, under IFRS 15, certain costs to obtain a contract, mainly sales commissions, are capitalized and amortized as operating expenses over the period of time the customer is expected to maintain its service or over the contract term. Previously, such costs were expensed as incurred. Also, the capitalization of connection costs is no longer limited to the related connection revenues as under the previous rules. These capitalized costs are included in “Other assets” as contract costs in the consolidated balance sheets. The adoption of IFRS 15 had no impact on cash flows from operating, investing and financing activities. The retroactive adoption of IFRS 15 had the following impacts on the comparative consolidated financial figures: Consolidated statements of income and comprehensive income Increase (decrease) 2017 2016 Revenues $ 22.4 $ 52.5 Purchase of goods and services (12.4) (13.2) Deferred income tax expense 9.2 17.4 Net income and comprehensive income attributable to shareholders $ 25.6 $ 48.3 Consolidated balance sheets December 31, December 31, Increase (decrease) 2017 2016 Other assets Contract assets 1 $ 183.6 $ 155.8 Contract costs 2 92.5 85.4 Deferred income tax liability 73.2 63.9 Deficit (202.9) (177.3) 1 The current portion of contract assets is $132.8 million as of December 31, 2017 and $106.6 million as of December 31, 2016. 2 The current portion of contract costs is $55.9 million as of December 31, 2017 and $49.4 million as of December 31, 2016 and is presented under “Other current assets”. |
Consolidation | (c) Consolidation The consolidated financial statements include the accounts of the Corporation and its subsidiaries. Intercompany transactions and balances are eliminated on consolidation. A subsidiary is an entity controlled by the Corporation. Control is achieved when the Corporation is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Non-controlling interests in the net assets and results of consolidated subsidiaries are identified separately from the parent corporation’s ownership interest. Non-controlling interests in the equity of a subsidiary consist of the amount of non‑controlling interests calculated at the date of the original business combination and their share of changes in equity since that date. Changes in non-controlling interests in a subsidiary that do not result in a loss of control by the Corporation are accounted for as equity transactions. |
Business acquisition | (d) Business acquisition A business acquisition is accounted for by the acquisition method. The cost of an acquisition is measured at the fair value of the consideration given in exchange for control of the business acquired at the acquisition date. This consideration can be comprised of cash, assets transferred, financial instruments issued, or future contingent payments. The identifiable assets and liabilities of the business acquired are recognized at their fair value at the acquisition date. Results of operations of a business acquired are included in the Corporation’s consolidated financial statements from the date of the business acquisition. Business acquisition and integration costs are expensed as incurred and included as other items in the consolidated statements of income. Non-controlling interests in an entity acquired are presented in the consolidated balance sheets within equity, separately from the equity attributable to shareholders. |
Foreign currency translation | (e) Foreign currency translation Foreign currency transactions are translated to the functional currency by applying the exchange rate prevailing at the date of the transaction. Translation gains and losses on monetary assets and liabilities denominated in a foreign currency are included in financial expenses, or in gain or loss on valuation and translation of financial instruments. |
Revenue recognition | (f) Revenue recognition The Corporation accounts for a contract with a customer only when all of the following criteria are met: · The parties to the contract have approved the contract (in writing, orally or in accordance with other customary business practices) and are committed to perform their respective obligations; · The entity can identify each party's rights regarding the goods or services to be transferred; · The entity can identify the payment terms for the goods or services to be transferred; · The contract has commercial substance (i.e. the risk, timing or amount of the entity's future cash flows is expected to change as a result of the contract); and · It is probable that the entity will collect the consideration to which it is entitled in exchange for the goods or services to be transferred to the customer. The portion of revenues that is invoiced and unearned is presented as “Deferred revenues” in the consolidated balance sheets. Deferred revenues are usually recognized as revenues in the subsequent year. Telecommunications The Telecommunications segment provides services under multiple deliverable arrangements, mainly for mobile contracts in which the sale of mobile devices is bundled with telecommunication services over the contract term. The total consideration from a contract with multiple deliverables is allocated to all performance obligations in the contract based on the stand-alone selling price of each obligation. The total consideration is generally comprised of an upfront fee for the equipment sale and a monthly fee for the telecommunication service. Each performance obligation of multiple deliverable arrangements is then separately accounted for based on its allocated consideration amount. The Corporation does not adjust the amount of consideration allocated to the equipment sale for the effects of a financing component since this component is not significant. The Telecommunications segment recognizes each of its main activities’ revenues as follows: · Operating revenues from subscriber services, such as cable television, Internet access, cable and mobile telephony, and over-the-top video services are recognized when services are provided; · Revenues from equipment sales to subscribers are recognized when the equipment is delivered; · Operating revenues related to service contracts are recognized in income on a straight-line basis over the period in which the services are provided; and · Cable connection and mobile activation revenues are deferred and recognized as revenues over the period of time the customer is expected to remain a customer of the Corporation or over the contract term. When a mobile device and a service are bundled under a single mobile contract, the term of the contract is generally 24 months. The portion of mobile revenues earned without being invoiced is presented as contract assets in the consolidated balance sheets. Contract assets are realized over the term of the contract. Media The Media segment recognizes each of its main activities’ revenues as follows: · Advertising revenues are recognized when the advertising is aired on television, is featured in newspapers or magazines or is displayed on the digital properties or on transit shelters; · Revenues from subscriptions to specialty television channels or to online publications are recognized on a monthly basis at the time service is provided or over the period of the subscription; · Revenues from the sale or distribution of newspapers and magazines are recognized upon delivery, net of provisions for estimated returns based on historical rate of returns; · Soundstage and equipment leasing revenues are recognized over the rental period; and · Revenues derived from speciality film and television services are recognized when services are provided. Sports and Entertainment The Sports and Entertainment segment recognizes each of its main activities’ revenues as follows: · Revenues from the sale or distribution of books and entertainment products are recognized upon delivery, net of provisions for estimated returns based on historical rate of returns; · Revenues from renting the arena and from tickets (including season tickets), food and beverage sales are recognized when the events take place and/or goods are sold, as the case may be; · Revenues from the rental of suites are recognized ratably over the period of the agreement; · Revenues from the sale of advertising in the form of venue signage or sponsorships, are recognized ratably over the period of the agreement; and · Revenues derived from sporting and cultural event management are recognized when services are provided. |
Impairment of assets | (g) Impairment of assets For the purposes of assessing impairment, assets are grouped in cash-generating units (“CGUs”), which represent the lowest levels for which there are separately identifiable cash inflows generated by those assets. The Corporation reviews, at each balance sheet date, whether events or circumstances have occurred to indicate that the carrying amounts of its long‑lived assets with finite useful lives may be less than their recoverable amounts. Goodwill, intangible assets having an indefinite useful life, and intangible assets not yet available for use are tested for impairment each financial year, as well as whenever there is an indication that the carrying amount of the asset, or the CGU to which an asset has been allocated, exceeds its recoverable amount. The recoverable amount is the higher of the fair value less costs of disposal and the value in use of the asset or the CGU. Fair value less costs of disposal represents the amount an entity could obtain at the valuation date from the asset’s disposal in an arm’s length transaction between knowledgeable, willing parties, after deducting the costs of disposal. The value in use represents the present value of the future cash flows expected to be derived from the asset or the CGU. An impairment loss is recognized in the amount by which the carrying amount of an asset or a CGU exceeds its recoverable amount. When the recoverable amount of a CGU to which goodwill has been allocated is lower than the CGU’s carrying amount, the related goodwill is first impaired. Any excess amount of impairment is recognized and attributed to assets in the CGU, prorated to the carrying amount of each asset in the CGU. An impairment loss recognized in prior periods for long-lived assets with finite useful lives and intangible assets having an indefinite useful life, other than goodwill, can be reversed through the consolidated statement of income to the extent that the resulting carrying value does not exceed the carrying value that would have been the result had no impairment loss been recognized previously. |
Barter transactions | (h) Barter transactions In the normal course of operations, the Corporation principally offers advertising in exchange for goods and services. Revenues thus earned and expenses incurred are accounted for on the basis of the fair value of goods and services provided. |
Income taxes | (i) Income taxes Current income taxes are recognized with respect to amounts expected to be paid or recovered under the tax rates and laws that have been enacted or substantively enacted at the balance sheet date. Deferred income taxes are accounted for using the liability method. Under this method, deferred income tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the carrying amounts of existing assets and liabilities in the consolidated financial statements and their respective tax bases. Deferred income tax assets and liabilities are measured using enacted or substantively enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred income tax assets and liabilities is recognized in income in the period that includes the substantive enactment date. A deferred tax asset is recognized initially when it is probable that future taxable income will be sufficient to use the related tax benefits and may be reduced subsequently, if necessary, to an amount that is more likely than not to be realized. A deferred tax expense or benefit is recognized either in other comprehensive income or directly in equity to the extent that it relates to items that are recognized in other comprehensive income or directly in equity in the same or a different period. In the course of the Corporation’s operations, there are a number of uncertain tax positions due to the complexity of certain transactions and to the fact that related tax interpretations and legislation are continually changing. When a tax position is uncertain, the Corporation recognizes an income tax benefit or reduces an income tax liability only when it is probable that the tax benefit will be realized in the future or that the income tax liability is no longer probable. |
Leases | (j) Leases Assets under leasing agreements are classified at the inception of the lease as (i) finance leases whenever the terms of the lease substantially transfer all the risks and rewards of ownership of the asset to the lessee, or as (ii) operating leases for all other leases. Operating lease rentals are recognized in the consolidated statements of income on a straight‑line basis over the period of the lease. Any lessee incentives are deferred and recognized evenly over the lease term. |
Financial instruments | (k) Financial instruments Classification, recognition and measurement Most of financial assets and liabilities are classified as subsequently measured at amortized cost, except for derivative financial instruments, which are measured at fair value through other comprehensive income or through profit or loss. Contingent consideration arising from a business acquisition or disposal are measured at fair value at the transaction date with subsequent changes in fair value recorded in the consolidated statements of income. Derivative financial instruments and hedge accounting The Corporation uses various derivative financial instruments to manage its exposure to fluctuations in foreign currency exchange rates and interest rates. The Corporation does not hold or use any derivative financial instruments for speculative purposes. Under hedge accounting, the Corporation documents all hedging relationships between hedging instruments and hedged items, as well as its strategy for using hedges and its risk-management objective. It also designates its derivative financial instruments as either fair value hedges or cash flow hedges when they qualify for hedge accounting. The Corporation assesses the effectiveness of its hedging relationships at initiation and on an ongoing basis. The Corporation generally enters into the following types of derivative financial instruments: · The Corporation uses foreign exchange forward contracts to hedge foreign currency rate exposure on anticipated equipment or inventory purchases in a foreign currency. The Corporation also uses offsetting foreign exchange forward contracts in combination with cross-currency interest rate swaps to hedge foreign currency rate exposure on principal payments on foreign currency denominated debt. These foreign exchange forward contracts are designated as cash flow hedges. · The Corporation uses cross-currency interest rate swaps to hedge (i) foreign currency rate exposure on interest and principal payments on foreign currency denominated debt and/or (ii) fair value exposure on certain debt resulting from changes in interest rates. The cross-currency interest rate swaps that set all future interest and principal payments on U.S.-dollar-denominated debt in fixed CAN dollars, in addition to converting an interest rate from a floating rate to a floating rate or from a fixed rate to a fixed rate, are designated as cash flow hedges. The cross-currency interest rate swaps are designated as fair value hedges when they set all future interest and principal payments on U.S.-dollar-denominated debt in fixed CAN dollars, in addition to converting the interest rate from a fixed rate to a floating rate. · The Corporation uses interest rate swaps to manage fair value exposure on certain debts resulting from changes in interest rates. These swap agreements require a periodic exchange of payments without the exchange of the notional principal amount on which the payments are based. These interest rate swaps are designated as fair value hedges when they convert the interest rate from a fixed rate to a floating rate, or as cash flow hedges when they convert the interest rate from a floating rate to a fixed rate. · The Corporation has established a hedge ratio of one for one for all its hedging relationships as underlying risks of its hedging derivatives are identical to the hedged item risks. The Corporation measures and records the effectiveness of its hedging relationships as follows: · For cash flow hedges, the hedge effectiveness is tested and measured by comparing changes in the fair value of the hedging derivative with the changes in the fair value of a hypothetical derivative that simulates the hedged items cash flows. · For fair value hedges, the hedge effectiveness is tested and measured by comparing changes in the fair value of the hedging derivative with the changes in the fair value of the hedged item attributable to the hedged risk. · Most of the Corporation’s hedging relationships are not generating material ineffectiveness. The ineffectiveness, if any, is recorded in the consolidated statements of income as a gain or loss on valuation and translation of financial instruments. Under hedge accounting, the Corporation applies the following accounting policies: · For derivative financial instruments designated as fair value hedges, changes in the fair value of the hedging derivative recorded in income are substantially offset by changes in the fair value of the hedged item to the extent that the hedging relationship is effective. When a fair value hedge is discontinued, the carrying value of the hedged item is no longer adjusted and the cumulative fair value adjustments to the carrying value of the hedged item are amortized to income over the remaining term of the original hedging relationship. · For derivative financial instruments designated as cash flow hedges, the effective portion of a hedge is reported in other comprehensive income until it is recognized in income during the same period in which the hedged item affects income, while the ineffective portion is immediately recognized in income. When a cash flow hedge is discontinued, the amounts previously recognized in accumulated other comprehensive income are reclassified to income when the variability in the cash flows of the hedged item affects income. Any change in the fair value of derivative financial instruments recorded in income is included in gain or loss on valuation and translation of financial instruments. Interest expense on hedged long‑term debt is reported at the hedged interest and foreign currency rates. Derivative financial instruments that do not qualify for hedge accounting, including derivatives that are embedded in financial or non‑financial contracts that are not closely related to the host contracts, are reported on a fair value basis in the consolidated balance sheets. Any change in the fair value of these derivative financial instruments is recorded in the consolidated statements of income as a gain or loss on valuation and translation of financial instruments. |
Financing fees | (l) Financing fees Financing fees related to long-term debt are capitalized in reduction of long-term debt and amortized using the effective interest rate method. |
Tax credits and government assistance | (m) Tax credits and government assistance The Corporation has access to several government programs designed to support production and distribution of televisual products and movies, as well as music products, magazine and book publishing in Canada. In addition, the Corporation receives tax credits mainly related to its research and development activities, publishing activities and digital activities. Government financial assistance is accounted for as revenue or as a reduction in related costs, whether capitalized and amortized or expensed, in the year the costs are incurred and when management has reasonable assurance that the conditions of the government programs are being met. |
Cash and cash equivalents | (n) Cash and cash equivalents Cash and cash equivalents include highly liquid investments purchased three months or less from maturity and are recorded at fair value. These highly liquid investments consisted mainly of Bankers’ acceptances and term deposits. |
Accounts receivable and contract assets | (o) Accounts receivable and contract assets Accounts receivable and contract assets are presented net of a provision for expected credit losses. The Corporation is using the IFRS 9 expected credit losses method to estimate that provision, which considers the specific credit risk of its customers, the expected lifetime of its financial assets, historical trends and economic conditions. Amounts receivable are written off when deemed uncollectible. |
Inventories | (p) Inventories Inventories are valued at the lower of cost, determined by the first-in, first-out method or the weighted‑average cost method, and net realizable value. Net realizable value represents the estimated selling price in the ordinary course of business, less the estimated costs of completion and the estimated costs necessary to make the sale. When the circumstances that previously caused inventories to be written down below cost no longer exist, the amount of the write‑down is reversed. In particular, inventories related to broadcasting activities, which primarily comprise programs and broadcast and distribution rights, are accounted for as follows: (i) Programs produced and productions in progress Programs produced and productions in progress related to broadcasting activities are accounted for at the lesser of cost and net realizable value. Cost includes direct charges for goods and services and the share of labour and general expenses related to each production. The cost of each program is charged to operating expenses when the program is broadcast. (ii) Broadcast and distribution rights Broadcast rights are essentially contractual rights allowing the limited or unlimited broadcast of televisual products or movies. Distribution rights include costs to acquire distribution rights for televisual products and movies and other operating costs incurred that generate future economic benefits. The Corporation records the rights acquired as inventory and the obligations incurred under a licence agreement as a liability when the broadcast or distribution period begins and all of the following conditions have been met: (a) the cost of the licence for each program, movies, series or right to broadcast a live event is known or can be reasonably determined; (b) the programs, movies or series have been accepted or the live event is broadcast in accordance with the conditions of the licence agreement; (c) the programs, movies or series are available for distribution, first showing or telecast, or when the live event is broadcast. Amounts paid for broadcast and distribution rights before all of the above conditions are met are recorded as prepaid rights. Broadcast and distribution rights are classified as current or long-term assets, based on management’s estimate of the broadcast or distribution period. These rights are charged to operating expenses when televisual products and movies are broadcast over the contract period, using a method based on how future economic benefits from those rights will be generated. Broadcast and distribution rights payable are classified as current or long-term liabilities based on the payment terms included in the licence. Estimates of future revenues used to determine the net realizable value of inventories related to the broadcasting or distribution of television products and movies are examined periodically by management and revised as necessary. The carrying value of programs produced and productions in progress, of broadcast and distribution rights is reduced to the net realizable value, if necessary, based on this assessment. |
Long-term investments | (q) Long-term investments Investments in companies subject to significant influence are accounted for using the equity method. Under the equity method, the share of the results of operations of the associated corporation is recorded in the consolidated statements of income. Carrying values of investments are reduced to estimated fair values if there is objective evidence that the investment is impaired. |
Property, plant and equipment | (r) Property, plant and equipment Property, plant and equipment are recorded at cost. Cost represents the acquisition costs, net of government grants and investment tax credits, or construction costs, including preparation, installation and testing costs. In the case of projects to construct cable and mobile networks, the cost includes equipment, direct labour and related overhead costs. Projects under development may also be comprised of advance payments made to suppliers for equipment under construction. Borrowing costs are also included in the cost of property, plant and equipment during the development phase. Expenditures, such as maintenance and repairs, are expensed as incurred. Depreciation is calculated on a straight-line basis over the following estimated useful lives: Assets Estimated useful lives Buildings and leasehold improvements 10 to 40 years Machinery and equipment 3 to 20 years Telecommunication networks 3 to 20 years Depreciation methods, residual values, and the useful lives of significant property, plant and equipment are reviewed at least once a year. Any change is accounted for prospectively as a change in accounting estimate. Leasehold improvements are depreciated over the shorter of the term of the lease and their estimated useful life. The Corporation does not record any decommissioning obligations in connection with its cable distribution networks. The Corporation expects to renew all of its agreements with utility companies to access their support structures in the future, making the retirement date so far into the future that the present value of the restoration costs is insignificant for those assets. A decommissioning obligation is however recorded for the rental of sites related to the mobile network. Videotron Ltd. (“Videotron”) is engaged in an agreement to operate a shared LTE network in the Province of Québec and the Ottawa region. |
Goodwill and intangible assets | (s) Goodwill and intangible assets Goodwill Goodwill initially arising from a business acquisition is measured and recognized as the excess of the fair value of the consideration paid over the fair value of the recognized identifiable assets acquired and liabilities assumed. Goodwill is allocated as at the date of a business acquisition to a CGU for purposes of impairment testing (note 1(g)). The allocation is made to the CGU or group of CGUs expected to benefit from the synergies of the business acquisition. Intangible assets Spectrum licences are recorded at cost. Spectrum licences have an indefinite useful life and are not amortized based on the following facts: (i) the Corporation intends to renew the spectrum licences and believes that they are likely to be renewed by Innovation, Science and Economic Development Canada ("ISED Canada"), (ii) the Corporation has the financial and operational ability to renew these spectrum licences, (iii) currently, the competitive, legal and regulatory landscape does not limit the useful lives of the spectrum licences, and (iv) the Corporation foresees no limit to the period during which these licences can be expected to generate cash flows in the future. Broadcasting licences, trademarks and sport franchises also have an indefinite useful life and are not amortized. These intangibles assets are recorded at cost or at fair value at the acquisition date if they are acquired through a business acquisition. Software is recorded at cost. In particular, internally generated intangible assets such as software and website development are mainly comprised of internal costs in connection with the development of assets to be used internally or to provide services to customers. These costs are capitalized when the development stage of the software application begins and costs incurred prior to that stage are recognized as expenses. Naming rights for the Videotron Centre in Québec City are recognized at cost. Customer relationships acquired through a business acquisition are recorded at fair value at the date of acquisition. Borrowing costs directly attributable to the acquisition, development or production of an intangible asset are also included as part of the cost of that asset during the development phase. Intangible assets with finite useful lives are amortized over their useful lives using the straight‑line method over the following periods: Assets Estimated useful lives Software 3 to 7 years Naming rights 25 years Customer relationships and other 3 to 10 years Amortization methods, residual values, and the useful lives of significant intangible assets are reviewed at least once a year. Any change is accounted for prospectively as a change in accounting estimate. |
Contract costs | (t) Contract costs Incremental and direct costs, such as costs to obtain a contract, mainly sales commissions, or the cost of connecting a subscriber to the Corporation’s telecommunication network are included in contract costs and amortized over the period of time the customer is expected to maintain its service or over the contract term. The amortization of contract costs is included in purchase of goods and services in the consolidated statements of income. |
Provisions | (u) Provisions Provisions are recognized when (i) the Corporation has a present legal or constructive obligation as a result of a past event and it is probable that an outflow of economic benefits will be required to settle the obligation, and when (ii) the amount of the obligation can be reliably estimated. Restructuring costs, comprised primarily of termination benefits, are recognized when a detailed plan for the restructuring exists and a valid expectation has been raised in those affected, that the plan will be carried out. Provisions are reviewed at each balance sheet date and changes in estimates are reflected in the consolidated statements of income in the reporting period in which the changes occur. |
Stock-based compensation | (v) Stock-based compensation Stock-based awards to employees that call for settlement in cash, as deferred share units (“DSUs”) or performance share units (“PSUs”), or that call for settlement in cash at the option of the employee, as stock options awards, are accounted for at fair value and classified as a liability. The compensation cost is recognized in expenses over the vesting period. Changes in the fair value of stock-based awards between the grant date and the measurement date result in a change in the liability and compensation cost. The fair value of DSUs and PSUs is based on the underlying share price at the date of valuation. The fair value of stock option awards is determined by applying an option pricing model, taking into account the terms and conditions of the grant. Key assumptions are described in note 23. |
Pension plans and postretirement benefits | (w) Pension plans and postretirement benefits The Corporation offers defined contribution pension plans and defined benefit pension plans to some of its employees. (i) Defined contribution pension plans Under its defined contribution pension plans, the Corporation pays fixed contributions to participating employees’ pension plans and has no legal or constructive obligation to pay any further amounts. Obligations for contributions to defined contribution pension plans are recognized as employee benefits in the consolidated statements of income when the contributions become due. (ii) Defined benefit pension plans and postretirement plans Defined benefit pension plan costs are determined using actuarial methods and are accounted for using the projected unit credit method, which incorporates management’s best estimates of future salary levels, other cost escalations, retirement ages of employees, and other actuarial factors. Defined benefit pension costs, recognized in the consolidated statements of income as employee costs, mainly include the following: · service costs provided in exchange for employee services rendered during the period; · prior service costs recognized at the earlier of (a) when the employee benefit plan is amended or (b) when restructuring costs are recognized; · curtailment or settlement gain or loss. Interest on net defined benefit liability or asset, recognized in the consolidated statements of income as financial expenses, is determined by multiplying the net defined benefit liability or asset by the discount rate used to determine the defined benefit obligation. Re-measurements of the net defined benefit liability or asset are recognized immediately in other comprehensive loss and in accumulated other comprehensive loss. Re-measurements are comprised of the following: · actuarial gains and losses arising from changes in financial and demographic actuarial assumptions used to determine the defined benefit obligation or from experience adjustments on liabilities; · the difference between actual return on plan assets and interest income on plan assets anticipated as part of the interest on net defined benefit liability or asset calculation; · changes in the net benefit asset limit or in the minimum funding liability. Recognition of a net benefit asset is limited under certain circumstances to the amount recoverable, which is primarily based on the present value of future contributions to the plan, to the extent that the Corporation can unilaterally reduce those future contributions. In addition, an adjustment to the net benefit asset or the net benefit liability can be recorded to reflect a minimum funding liability in a certain number of the Corporation’s pension plans. The Corporation also offers discounts on telecommunication services, health, life and dental insurance plans to some of its retired employees. The cost of postretirement benefits is determined using an accounting methodology similar to that for defined benefit pension plans. The benefits related to these plans are funded by the Corporation as they become due. |
Use of estimates and judgments | (x) Use of estimates and judgments The preparation of consolidated financial statements in accordance with IFRS requires management to make estimates, assumptions and judgments that affect the reported amounts of assets and liabilities, related amounts of revenues and expenses, and disclosure of contingent assets and liabilities. Although these estimates are based on management’s best judgment and information available at the time of the assessment date, actual results could differ from those estimates. The following significant areas represent management’s most difficult, subjective or complex estimates: (i) Recoverable amount of an asset or a CGU When an impairment test is performed on an asset or a CGU, management estimates the recoverable amount of the asset or CGU based on its fair value less costs of disposal or its value in use. These estimates are based on valuation models requiring the use of a number of assumptions such as forecasts of future cash flows, pre-tax discount rate (WACC) and perpetual growth rate. These assumptions have a significant impact on the results of impairment tests and on the impairment charge, as the case may be, recorded in the consolidated statements of income. A description of key assumptions used in the goodwill impairment tests and a sensitivity analysis of recoverable amounts are presented in note 15. (ii) Costs and obligations related to pension and postretirement benefit plans Estimates of costs and obligations related to pension and postretirement benefit obligations are based on a number of assumptions, such as the discount rate, the rate of increase in compensation, the retirement age of employees, health care costs, and other actuarial factors. Certain of these assumptions may have a significant impact on employee costs and financial expenses recorded in the consolidated statements of income, the re-measurement gain or loss on defined benefit plans recorded in the consolidated statements of comprehensive income, and on the carrying value of other assets or other liabilities in the consolidated balance sheets. Key assumptions and a sensitivity analysis on the discount rate are presented in note 29. (iii) Provisions The recognition of provisions requires management to estimate expenditures required to settle a present obligation or to transfer it to a third party at the date of assessment. More specifically, an assessment of the probable outcomes of legal proceedings or other contingencies is also required. A description of the main provisions, including management expectations on the potential effect of the possible outcomes of legal disputes on the consolidated financial statements, is presented in note 19. (iv) Contingent considerations Contingent considerations arising from business acquisition or disposal are measured and accounted for at their fair value. The fair value is estimated based on a present value model requiring management to assess the probabilities that the conditions on which the contingent considerations are based will be met in the future. The assessment of these contingent potential outcomes requires judgment from management and could have an impact on the initial amount of contingent considerations recognized and any subsequent changes in fair value recorded in the consolidated statements of income. The following areas represent management’s most significant judgments, apart from those involving estimates: (i) Useful life periods for the depreciation and amortization of assets with finite useful lives For each class of assets with finite useful lives, management has to determine over which period the Corporation will consume the assets’ future economic benefits. The determination of a useful life period involves judgment and has an impact on the depreciation and amortization charge recorded in the consolidated statements of income. (ii) Indefinite useful life of spectrum licences Management has concluded that spectrum licences have an indefinite useful life. This conclusion was based on an analysis of factors, such as the Corporation’s financial ability to renew the spectrum licences, the competitive, legal and regulatory landscape, and future expectations regarding the use of the spectrum licences. The determination that spectrum licences have an indefinite useful life therefore involves judgment, which could have an impact on the amortization charge recorded in the consolidated statements of income if management were to change its conclusion in the future. (iii) Interpretation of laws and regulations Interpretation of laws and regulation, including tax regulations, requires judgment from management that could have an impact on the recognition of provisions for legal litigation and income taxes in the consolidated financial statements. |
Recent accounting pronouncements | (y) Recent accounting pronouncements (i) IFRS 16 – Leases is required to be applied retrospectively for annual periods beginning on or after January 1, 2019. On January 1, 2019, the Corporation adopted on a fully retrospective basis the new rules under IFRS 16 which set out new principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract. The standard provides lessees with a single accounting model for all leases, with certain exemptions. In particular, lessees will be required to report most leases on their balance sheets by recognizing right-of-use assets and related financial liabilities. Assets and liabilities arising from a lease will be initially measured on a present value basis. The adoption of IFRS 16 has significant impacts on the consolidated financial statements since all of the Corporation segments are engaged in various long-term leases relating to premises and equipment. Under IFRS 16, most lease charges will be expensed as a depreciation of the right-of-use asset, along with an interest on the related lease liability. Since operating lease charges are currently recognized as operating expenses as they are incurred, the adoption of IFRS 16 will change the timing of the recognition of these lease charges over the term of each lease. It will also affect the classification of expenses in the consolidated statements of income. Under IFRS 16, principal payments of the lease liability will be presented as financing activities in the consolidated statements of cash flows, whereas under the current standard these payments are presented as operating activities. The retroactive adoption of IFRS 16 will have the following impacts on the 2018 and 2017 consolidated financial figures: Consolidated statements of income and comprehensive income Increase (decrease) 2018 2017 Purchase of goods and services $ (52.5) $ (49.8) Depreciation and amortization 38.9 37.8 Financial expenses 11.0 12.5 Restructuring of operations (0.7) 0.3 Deferred income tax expense 0.9 (0.2) Net income and comprehensive income attributable to shareholders $ 2.4 $ (0.6) Net income and comprehensive income attributable to Shareholders (0.5) Non-controlling interests (0.1) Consolidated balance sheets December 31, December 31, Increase (decrease) 2018 2017 Right-of-use assets $ 146.7 $ 170.1 Provisions (1.4) (1.4) Lease liabilities 1 179.5 205.2 Other liabilities (4.3) (3.4) Deferred income tax liability (7.1) (8.0) Deficit 19.8 21.9 Non-controlling interest (0.2) (0.4) 1 (ii) IFRIC 23 - Uncertainty over Income Tax Treatments is required to be applied retrospectively for annual periods beginning on or after January 1, 2019. IFRIC 23 provides guidance on how to value uncertain income tax positions based on the probability of whether or not the relevant tax authorities will accept the Corporation's tax treatments. The adoption of IFRIC 23 will not have a material impact on the consolidated financial statements. |
SEGMENTED INFORMATION (Tables)
SEGMENTED INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
SEGMENTED INFORMATION | |
Schedule of major subsidiaries | % voting % equity Videotron Ltd. 100.0 % 100.0 % TVA Group Inc. 99.9 % 68.4 % MediaQMI Inc. 100.0 % 100.0 % QMI Spectacles Inc. 100.0 % 100.0 % |
Schedule of segmented information | Sports and Head Office Telecommunications Media Entertainment and Intersegments Total 2018 Revenues $ 3,382.0 $ 728.6 $ 182.1 $ (111.7) $ 4,181.0 Employee costs 387.1 234.4 38.8 36.3 696.6 Purchase of goods and services 1,317.9 438.9 138.3 (143.1) 1,752.0 Adjusted EBITDA 1 1,677.0 55.3 5.0 (4.9) 1,732.4 Depreciation and amortization 717.9 Financial expenses 280.5 Loss on valuation and translation of financial instruments 0.9 Restructuring of operations, litigation and other items 29.8 Income before income taxes $ 703.3 Additions to property, plant and equipment $ 516.7 $ 28.7 $ 1.5 $ 5.8 $ 552.7 Additions to intangible assets 190.2 4.8 3.5 (1.1) 197.4 Sports and Head Office Telecommunications Media Entertainment and Intersegments Total 2017 (restated, note 1(b)) Revenues $ 3,287.8 $ 769.9 $ 181.3 $ (113.9) $ 4,125.1 Employee costs 388.8 232.0 37.6 47.8 706.2 Purchase of goods and services 1,341.2 468.6 137.5 (147.6) 1,799.7 Adjusted EBITDA 1 1,557.8 69.3 6.2 (14.1) 1,619.2 Depreciation and amortization 705.3 Financial expenses 281.8 Loss on valuation and translation of financial instruments 2.4 Restructuring of operations, litigation and other items 17.2 Gain on sale of spectrum licences (330.9) Impairment of goodwill and intangible assets 43.8 Loss on debt refinancing 15.6 Income before income taxes $ 884.0 Additions to property, plant and equipment $ 570.9 $ 29.4 $ 1.3 $ 0.2 $ 601.8 Additions to intangible assets 132.3 3.3 4.3 2.0 141.9 Sports and Head Office Telecommunications Media Entertainment and Intersegments Total 2016 (restated, note 1(b)) Revenues $ 3,192.3 $ 789.2 $ 185.0 $ (109.4) $ 4,057.1 Employee costs 379.7 242.4 38.3 47.5 707.9 Purchase of goods and services 1,301.7 492.9 144.4 (149.1) 1,789.9 Adjusted EBITDA 1 1,510.9 53.9 2.3 (7.8) 1,559.3 Depreciation and amortization 648.5 Financial expenses 302.0 Loss on valuation and translation of financial instruments 2.1 Restructuring of operations, litigation and other items 28.5 Impairment of goodwill and intangible assets 40.9 Loss on debt refinancing 7.3 Income before income taxes $ 530.0 Additions to property, plant and equipment $ 613.7 $ 37.2 $ 3.5 $ 0.1 $ 654.5 Additions to intangible assets 125.6 7.5 3.5 3.2 139.8 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of impacts on consolidated financial figures by retroactive adoption of IFRS 15 | Consolidated statements of income and comprehensive income Increase (decrease) 2017 2016 Revenues $ 22.4 $ 52.5 Purchase of goods and services (12.4) (13.2) Deferred income tax expense 9.2 17.4 Net income and comprehensive income attributable to shareholders $ 25.6 $ 48.3 Consolidated balance sheets December 31, December 31, Increase (decrease) 2017 2016 Other assets Contract assets 1 $ 183.6 $ 155.8 Contract costs 2 92.5 85.4 Deferred income tax liability 73.2 63.9 Deficit (202.9) (177.3) 1 The current portion of contract assets is $132.8 million as of December 31, 2017 and $106.6 million as of December 31, 2016. 2 The current portion of contract costs is $55.9 million as of December 31, 2017 and $49.4 million as of December 31, 2016 and is presented under “Other current assets”. |
Schedule of property, plant and equipment useful lives | Assets Estimated useful lives Buildings and leasehold improvements 10 to 40 years Machinery and equipment 3 to 20 years Telecommunication networks 3 to 20 years |
Schedule of useful lives of intangible assets using the straight-line method | Assets Estimated useful lives Software 3 to 7 years Naming rights 25 years Customer relationships and other 3 to 10 years |
Schedule of impacts on consolidated financial figures by retroactive adoption of IFRS 16 | Consolidated statements of income and comprehensive income Increase (decrease) 2018 2017 Purchase of goods and services $ (52.5) $ (49.8) Depreciation and amortization 38.9 37.8 Financial expenses 11.0 12.5 Restructuring of operations (0.7) 0.3 Deferred income tax expense 0.9 (0.2) Net income and comprehensive income attributable to shareholders $ 2.4 $ (0.6) Net income and comprehensive income attributable to Shareholders (0.5) Non-controlling interests (0.1) Consolidated balance sheets December 31, December 31, Increase (decrease) 2018 2017 Right-of-use assets $ 146.7 $ 170.1 Provisions (1.4) (1.4) Lease liabilities 1 179.5 205.2 Other liabilities (4.3) (3.4) Deferred income tax liability (7.1) (8.0) Deficit 19.8 21.9 Non-controlling interest (0.2) (0.4) 1 |
REVENUES (Tables)
REVENUES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
REVENUES | |
Schedule of revenues | 2018 2017 2016 (restated, (restated, note 1(b)) note 1(b)) Internet $ 1,079.3 $ 1,030.9 $ 978.7 Cable television 996.7 1,009.6 1,024.3 Mobile telephony 534.4 469.8 409.6 Cable telephony 368.6 397.8 424.8 Telecommunication equipment sales 233.5 219.0 206.9 Connection and data services 108.2 104.8 99.2 Over-the-top video 47.0 39.7 31.4 Advertising - television 246.1 267.5 254.8 Subscription - television 126.2 125.0 119.9 Soundstage and equipment leasing and post-production services 68.4 67.1 59.3 Advertising – newspapers and magazines 106.0 125.4 148.0 Circulation and other – newspapers and magazines 146.0 152.7 168.9 Other 120.6 115.8 131.3 $ 4,181.0 $ 4,125.1 $ 4,057.1 |
EMPLOYEE COSTS AND PURCHASE O_2
EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES | |
Schedule of employee costs and purchase of goods and services | 2018 2017 2016 (restated, (restated, note 1(b)) note 1(b)) Employee costs $ 895.9 $ 893.6 $ 891.2 Less employee costs capitalized to property, plant and equipment and to intangible assets (199.3) (187.4) (183.3) 696.6 706.2 707.9 Purchase of goods and services: Royalties, rights and creation costs 681.7 677.9 701.9 Cost of products sold 380.2 360.1 338.3 Service contracts 154.3 172.3 168.7 Marketing, circulation and distribution expenses 105.9 108.9 113.8 Building expenses 97.9 99.5 92.5 Other 332.0 381.0 374.7 1,752.0 1,799.7 1,789.9 $ 2,448.6 $ 2,505.9 $ 2,497.8 |
FINANCIAL EXPENSES (Tables)
FINANCIAL EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
FINANCIAL EXPENSES | |
Schedule of financial expenses | 2018 2017 2016 Interest on long-term debt $ 287.8 $ 274.7 $ 288.0 Amortization of financing costs and long-term debt discount 6.8 6.9 7.0 Interest on net defined benefit liability 6.2 5.8 6.7 Loss (gain) on foreign currency translation on short-term monetary items 2.3 (2.0) 0.5 Interest from the parent corporation (14.8) — — Other (7.8) (3.6) (0.2) $ 280.5 $ 281.8 $ 302.0 |
IMPAIRMENT OF GOODWILL AND OT_2
IMPAIRMENT OF GOODWILL AND OTHER ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
IMPAIRMENT OF GOODWILL AND OTHER ASSETS | |
Schedule of impairment of goodwill and other assets | 2018 2017 2016 Impairment of goodwill $ — $ 30.0 $ 40.1 Impairment of intangible assets — 13.8 0.8 $ — $ 43.8 $ 40.9 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
INCOME TAXES | |
Summary of income tax reconciliation | 2018 2017 2016 (restated, (restated, note 1(b)) note 1(b)) Income taxes at domestic statutory tax rate $ 187.8 $ 236.9 $ 142.5 (Reduction) increase resulting from: Effect of non-deductible charges, non-taxable income and differences between current and future tax rates (1.2) (48.5) 1.0 Change in benefit arising from the recognition of current and prior year tax losses (notes 6 and 30) (18.5) (47.0) (0.5) Non-deductible impairment of goodwill — 0.4 10.8 Change in deferred tax balances due to a change in substantively enacted tax rates — — (6.4) Effect of tax consolidation transactions with the parent corporation — — (0.3) Other (1.5) (0.6) (3.8) Income taxes $ 166.6 $ 141.2 $ 143.3 |
Summary of components of net deferred income tax liability and their impact on the deferred income tax expense | Consolidated Consolidated balance sheets income statements 2018 2017 2018 2017 2016 (restated, (restated, (restated, note 1(b)) note 1(b)) note 1(b)) Loss carryforwards $ 22.8 $ 0.4 $ (8.0) $ 3.6 $ 2.9 Accounts payable, accrued charges, provisions and deferred revenue 13.9 14.5 0.6 1.4 (4.0) Defined benefit plans 40.6 35.5 (3.2) (1.9) (2.2) Contract assets (54.3) (48.5) 5.8 7.4 14.3 Property, plant and equipment (471.7) (488.1) (16.4) 84.5 12.3 Goodwill, intangible assets and other assets (233.4) (199.4) 34.0 43.9 25.8 Long-term debt and derivative financial instruments (21.0) (14.0) 1.3 (7.4) 0.3 Benefits from a general partnership — — — (0.6) (67.0) Other 10.2 8.7 (2.4) 1.5 2.9 $ (692.9) $ (690.9) $ 11.7 $ 132.4 $ (14.7) |
Summary of changes in the net deferred income tax liability | Note 2018 2017 (restated, note 1(b)) Balance at beginning of year $ (690.9) $ (588.2) Recognized in income as continuing operations (11.7) (132.4) Recognized in other comprehensive income (3.8) 28.9 Acquisition of tax deductions 28 14.4 — Other (0.9) 0.8 Balance at end of year $ (692.9) $ (690.9) Deferred income tax asset $ 51.8 $ 33.2 Deferred income tax liability (744.7) (724.1) $ (692.9) $ (690.9) |
BUSINESS ACQUISITIONS (Tables)
BUSINESS ACQUISITIONS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
NON-CONTROLLING INTERESTS AND BUSINESS ACQUISITIONS | |
Schedule of purchase price allocation between the fair value of identifiable assets and liabilities | 2016 Assets acquired Non-cash current assets $ 5.5 Property, plant and equipment 32.7 Intangible assets 15.6 Goodwill 87.1 140.9 Liabilities assumed Non-cash current liabilities (3.1) Deferred income taxes (7.5) Other long-term liabilities (5.7) (16.3) Net assets acquired at fair value $ 124.6 Consideration Cash, net of cash acquired $ 119.0 Balance payable 5.6 $ 124.6 |
ACCOUNTS RECEIVABLE (Tables)
ACCOUNTS RECEIVABLE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
ACCOUNTS RECEIVABLE | |
Schedule of accounts receivable | 2018 2017 Trade $ 468.0 $ 486.4 Other 1 94.1 56.6 $ 562.1 $ 543.0 1 Includes interest receivable from Quebecor of an amount of $8.6 million as of December 31, 2018. |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
INVENTORIES | |
Schedule of inventories | 2018 2017 Finished goods $ 88.8 $ 87.6 Programs, broadcast and distribution rights 77.3 78.2 Raw materials and supplies 20.2 22.3 $ 186.3 $ 188.1 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
PROPERTY, PLANT AND EQUIPMENT | |
Schedule of changes in the net carrying amount of property, plant and equipment | Land, buildings and Machinery Projects leasehold and Telecommunication under improvements equipment networks development Total Cost Balance as of December 31, 2016 $ 573.6 $ 1,663.6 $ 5,549.1 $ 92.5 $ 7,878.8 Additions 35.9 145.5 364.4 56.0 601.8 Net change in additions financed with accounts payable — (2.0) (3.4) 1.0 (4.4) Reclassification — 14.4 90.1 (104.5) — Retirement, disposals and other 1 3.4 (70.3) (98.4) 1.2 (164.1) Balance as of December 31, 2017 612.9 1,751.2 5,901.8 46.2 8,312.1 Additions 20.0 151.4 297.3 84.0 552.7 Net change in additions financed with accounts payable — 1.8 (11.9) 13.3 3.2 Reclassification 2.1 3.1 41.5 (46.7) — Reclassification to assets held for sale (84.0) — — — (84.0) Retirement, disposals and other 1 (6.6) (35.3) (231.5) (5.8) (279.2) Balance as of December 31, 2018 $ 544.4 $ 1,872.2 $ 5,997.2 $ 91.0 $ 8,504.8 Land, buildings and Machinery Projects leasehold and Telecommunication under improvements equipment networks development Total Accumulated depreciation and impairment losses Balance as of December 31, 2016 $ 200.0 $ 1,088.3 $ 3,028.0 $ — $ 4,316.3 Depreciation 18.4 199.1 384.0 — 601.5 Retirement, disposals and other 1 3.3 (65.7) (97.6) — (160.0) Balance as of December 31, 2017 221.7 1,221.7 3,314.4 — 4,757.8 Depreciation 18.8 191.8 401.8 — 612.4 Reclassification to assets held for sale (11.5) — — — (11.5) Retirement, disposals and other 1 (2.6) (33.6) (231.2) — (267.4) As of December 31, 2018 $ 226.4 $ 1,379.9 $ 3,485.0 $ — $ 5,091.3 Net carrying amount As of December 31, 2017 $ 391.2 $ 529.5 $ 2,587.4 $ 46.2 $ 3,554.3 As of December 31, 2018 $ 318.0 $ 492.3 $ 2,512.2 $ 91.0 $ 3,413.5 1 Includes also the net change in assets related to discontinued operations. |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
INTANGIBLE ASSETS | |
Schedule of changes in the net carrying amount of intangible assets | Customer Broadcasting relationships, licences, naming trademarks Projects Spectrum rights and and sport under licences Software other franchises development Total Cost Balance as of December 31, 2016 $ 1,006.9 $ 811.0 $ 121.1 $ 120.1 $ 25.1 $ 2,084.2 Additions — 77.7 2.4 — 61.8 141.9 Net change in additions financed with accounts payable — 13.9 — — 12.3 26.2 Reclassification — 32.1 — — (32.1) — Retirement, disposals and other (note 6) (283.4) (7.6) (2.8) — (2.3) (296.1) Balance as of December 31, 2017 723.5 927.1 120.7 120.1 64.8 1,956.2 Additions — 100.9 2.6 — 93.9 197.4 Net change in additions financed with accounts payable — (3.5) — — 68.1 64.6 Reclassification to assets held for sale — — (5.1) — — (5.1) Reclassification — 50.4 — — (50.4) — Retirement, disposals and other — (7.2) 1.2 (8.0) (9.6) (23.6) Balance as of December 31, 2018 $ 723.5 $ 1,067.7 $ 119.4 $ 112.1 $ 166.8 $ 2,189.5 Customer Broadcasting relationships, licences, naming trademarks Projects Spectrum rights and and sport under licences Software other franchises development Total Accumulated amortization and impairment losses Balance as of December 31, 2016 $ 247.7 $ 461.8 $ 48.1 $ 102.6 $ — $ 860.2 Amortization — 93.0 10.8 — — 103.8 Impairment losses (note 7) — 1.4 4.4 8.0 — 13.8 Retirement, disposals and other — (2.9) (1.8) — — (4.7) Balance as of December 31, 2017 247.7 553.3 61.5 110.6 — 973.1 Amortization — 96.5 9.0 — — 105.5 Reclassification to assets held for sale — — (3.5) — — (3.5) Retirement, disposals and other — (9.9) (3.0) (8.0) — (20.9) Balance as of December 31, 2018 $ 247.7 $ 639.9 $ 64.0 $ 102.6 $ — $ 1,054.2 Net carrying amount As of December 31, 2017 $ 475.8 $ 373.8 $ 59.2 $ 9.5 $ 64.8 $ 983.1 As of December 31, 2018 $ 475.8 $ 427.8 $ 55.4 $ 9.5 $ 166.8 $ 1,135.3 |
GOODWILL (Tables)
GOODWILL (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
GOODWILL | |
Schedule of changes in the net carrying amount of goodwill | 2018 2017 Cost Balance at beginning of year $ 5,688.6 $ 5,688.2 Business acquisitions 2.1 0.4 Reclassification to assets held for sale (19.6) — Balance at end of year 5,671.1 5,688.6 Accumulated impairment losses Balance at beginning of year 2,992.8 2,962.8 Impairment losses (note 7) — 30.0 Balance at end of year 2,992.8 2,992.8 Net carrying amount $ 2,678.3 $ 2,695.8 |
Schedule of allocation of net carrying amount of goodwill in significant CGU groups | 2018 2017 CGU groups Telecommunications $ 2,656.1 $ 2,677.0 Other 1 22.2 18.8 Total $ 2,678.3 $ 2,695.8 1 Includes mainly the CGUs related to Speciality film and television services, Book publishing and distribution, and Sports and Entertainment. |
Schedule of determination of recoverable amounts in the impairment tests performed in significant CGU groups | 2018 2017 Pre-tax Perpetual Pre-tax Perpetual discount rate growth discount rate growth CGU groups 1 (WACC) rate (WACC) rate Telecommunications 9.0 % 2.5 % 8.5 % 2.5 % Magazines — — 15.5 (2.0) Other 11.5 to 16.50 0.0 to 2.0 12.0 to 16.5 0.0 to 2.0 1 In 2018 and 2017, the recoverable amounts of all CGUs were based on value in use, using the discounted cash flow method. |
OTHER ASSETS (Tables)
OTHER ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
OTHER ASSETS | |
Schedule of other assets | 2018 2017 (restated, note 1(b)) Contract assets 1 $ 204.9 $ 183.6 Contract costs 2 103.0 102.9 Programs, broadcast and distribution rights 120.3 121.4 Other 48.4 44.1 476.6 452.0 Less current portion of contract assets (144.4) (132.8) Less current portion of contract costs (included in “Other current assets”) (53.4) (55.9) Less current portion of program, broadcast and distribution rights (included in “Inventories”) (77.3) (78.3) $ 201.5 $ 185.0 1 Impairment loss on contract assets resulting from mobile contracts being cancelled prior their initial term amounted to $25.8 million in 2018 ($16.1 million in 2017 and $12.0 million in 2016), net of the early termination penalty charged to the customer. In current and comparative periods, there were no significant cumulative catch-up adjustments to revenue that affected the corresponding contract asset, including adjustments arising from a change in an estimate of the transaction price or a contract modification. There were also no significant changes in the time frame for a performance obligation to be satisfied. 2 Amortization amounted to $63.2 million in 2018 ($59.4 million in 2017 and $51.0 million in 2016). |
ACCOUNTS PAYABLE AND ACCRUED _2
ACCOUNTS PAYABLE AND ACCRUED CHARGES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
ACCOUNTS PAYABLE AND ACCRUED CHARGES | |
Schedule of accounts payable and accrued charges | 2018 2017 Trade and accruals $ 612.7 $ 512.2 Salaries and employee benefits 139.0 144.0 Interest payable 49.9 49.6 Stock-based compensation 18.9 19.8 $ 820.5 $ 725.6 |
PROVISIONS AND CONTINGENCIES (T
PROVISIONS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
PROVISIONS AND CONTINGENCIES | |
Summary of provisions | Contingencies, Restructuring legal disputes of operations and other Total Balance as of December 31, 2017 $ 5.9 $ 38.8 $ 44.7 Recognized in income 14.9 3.5 18.4 Payments (13.8) (1.7) (15.5) Other — 0.9 0.9 Balance as of December 31, 2018 $ 7.0 $ 41.5 $ 48.5 Current portion $ 4.8 $ 23.7 $ 28.5 Non-current portion (included in “Other liabilities”) 2.2 17.8 20.0 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
LONG-TERM DEBT | |
Schedule of long-term debt | Effective interest rate as of December 31, 2018 2018 2017 Quebecor Media Bank credit facilities (i) 4.87 % $ 451.7 $ 420.4 Senior Notes (ii) 1,659.2 1,568.5 2,110.9 1,988.9 Videotron (iii) Bank credit facilities (iv) 3.24 % 742.0 5.4 Senior Notes (ii) 3,502.4 3,289.2 4,244.4 3,294.6 TVA Group (iii) Bank credit facilities (v) 3.79 % 52.9 62.9 Other — 0.3 Total long-term debt 6,408.2 5,346.7 Change in fair value related to hedged interest rate risk 2.5 5.8 Financing fees, net of amortization (35.7) (40.8) (33.2) (35.0) 6,375.0 5,311.7 Less current portion (56.6) (19.1) $ 6,318.4 $ 5,292.6 (i) The bank credit facilities of Quebecor Media are comprised of a US$350.0 million secured term loan “B” facility that matures in August 2020 and is bearing interest at U.S London Interbank Offered Rate (“LIBOR”) plus a premium of 2.25% and a $300.0 million secured revolving credit facility that matures in July 2020 and is bearing interest at Bankers’ acceptance rate, LIBOR, Canadian prime rate or U.S. prime rate, plus a premium determined by a leverage ratio. The term loan “B” facility provides for quarterly amortization payments totaling 1.00% per annum of the original principal amount, with the balance payable on August 17, 2020. These credit facilities contain covenants such as maintaining certain financial ratios, limitations on the Corporation’s ability to incur additional indebtedness, pay dividends, and make other distributions. They are secured by liens on all of the movable property and assets of the Corporation (primarily shares of its subsidiaries), now owned or hereafter acquired. As of December 31, 2018, the credit facilities were secured by assets with a carrying value of $1,707.0 million ($3,045.4 million in 2017). As of December 31, 2018 and 2017, no amount had been drawn on the revolving credit facility, and as of December 31, 2018, $451.7 million was outstanding on the term loan “B” ( $420.4 million in 2017). On February 15, 2019, Quebecor Media amended its $300.0 million secured revolving credit facility to extend the maturity date to July 2022 and to change certain conditions and terms of the facility. (ii) The Senior Notes are unsecured and contain certain restrictions on the respective issuers, including limitations on their ability to incur additional indebtedness, pay dividends, or make other distributions. Some Notes are redeemable at the option of the issuer, in whole or in part, at a price based on a make-whole formula during the first five years of the term of the Notes and at a decreasing premium thereafter, while the remaining Notes are redeemable at a price based on a make‑whole formula at any time prior to maturity. The Senior Notes issued by Videotron are guaranteed by specific subsidiaries of Videotron. The following table summarizes the terms of the outstanding Senior Notes as of December 31, 2018: Effective interest rate (after discount or Annual nominal premium at Interest payable Principal amount interest rate issuance) Maturity date every 6 months on Quebecor Media US$ 850.0 5.750 % 5.750 % January 15, 2023 June and December 15 $ 500.0 6.625 % 6.625 % January 15, 2023 June and December 15 Videotron US$ 800.0 5.000 % 5.000 % July 15, 2022 January and July 15 US$ 600.0 5.375 % 5.375 % June 15, 2024 June and December 15 $ 400.0 5.625 % 5.625 % June 15, 2025 April and October 15 $ 375.0 5.750 % 5.750 % January 15, 2026 March and September 15 US$ 600.0 1 5.125 % 5.125 % April 15, 2027 April and October 15 1 The Notes were issued in April 2017 for net proceeds of $794.5 million, net of financing fees of $9.9 million. (iii) The debts of these subsidiaries are non-recourse to Quebecor Media. (iv) The bank credit facility provides for a $1,500.0 million ($965.0 million in 2017) secured revolving credit facility that matures in July 2023. The revolving credit facility bears interest at Bankers’ acceptance rate, LIBOR, Canadian prime rate or U.S. prime rate, plus a margin, depending on Videotron’s leverage ratio. The bank credit facility is secured by a first ranking hypothec on the universality of all tangible and intangible assets, current and future, of Videotron and most of its wholly owned subsidiaries. As of December 31, 2018, the bank credit facility was secured by assets with a carrying value of $7,639.2 million ($6,665.7 million in 2017). The bank credit facility contains covenants such as maintaining certain financial ratios, limitations on Videotron’s ability to incur additional indebtedness, pay dividends, or make other distributions. As of December 31, 2018, $742.0 million had been drawn on the secured revolving credit facility (no amount was drawn in 2017, while $5.4 million was outstanding in 2017 on an export financing facility that matured in June 2018). In December 2018, Videotron entered into new unsecured on demand credit facilities, under which letters of credit were issued and filed with ISED Canada as pre-auction financial deposits in respect to its application to participate to the 600 MHz spectrum auction. Under ISED Canada published rules respecting restrictions on communications during the auction process, it is strictly forbidden for the Corporation to disclose the amount of the letters of credit, which can be withdrawn by Videotron at anytime prior to the auction commencement. (v) The bank credit facilities of TVA Group comprise a secured revolving credit facility in the amount of $150.0 million, maturing in February 2019, and a secured term loan in the amount of $75.0 million, maturing in November 2019. TVA Group’s revolving credit facility bears interest at floating rates based on Bankers’ acceptance rate, LIBOR, Canadian prime rate or U.S. prime rate, plus a premium determined by a leverage ratio. The term loan bears interest at floating rates based on Bankers’ acceptance rate or Canadian prime rate, plus a premium determined by a leverage ratio. The term loan provides for quarterly amortization payments commencing on December 20, 2015. The bank credit facilities contain covenants such as maintaining certain financial ratios, limitations on TVA Group’s ability to incur additional indebtedness, pay dividends, or make other distributions. They are secured by liens on all of its movable assets and an immovable hypothec on its Head Office building. As of December 31, 2018 and 2017, no amount had been drawn on the revolving credit facility, and as of December 31, 2018, $52.9 million was outstanding on the term loan ($62.9 million in 2017). On February 13, 2019, TVA Group amended its $150.0 million secured revolving credit facility to extend the maturity date to February 2020 and to change certain conditions and terms of the facility. On December 31, 2018, the Corporation was in compliance with all debt covenants. |
Schedule of principal repayments of long-term debt | Principal repayments of long-term debt over the coming years are as follows: 2019 $ 56.6 2020 448.1 2021 — 2022 1,091.0 2023 2,401.2 2024 and thereafter 2,411.3 |
OTHER LIABILITIES (Tables)
OTHER LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
OTHER LIABILITIES | |
Schedule of other liabilities | Note 2018 2017 Defined benefit plans $ 153.9 $ 136.9 Deferred revenues 14.6 17.4 Stock-based compensation 1 12.2 8.3 Other 32.6 32.4 $ 213.3 $ 195.0 1 The current $18.9 million portion of stock-based compensation is included in accounts payable and accrued charges ($19.8 million in 2017) (note 18). |
CAPITAL STOCK (Tables)
CAPITAL STOCK (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
CAPITAL STOCK | |
Summary of issued and outstanding capital stock | Common Shares Number Amount Balance as of December 31, 2016 95,983,176 $ 3,701.4 Reduction of paid-up capital — (50.0) Redemption (541,899) (20.6) Balance as of December 31, 2017 95,441,277 3,630.8 Redemption (16,064,215) (611.1) Balance as of December 31, 2018 $ 3,019.7 |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
STOCK-BASED COMPENSATION PLANS | |
Schedule of weighted-average assumptions for estimate of fair value of outstanding stock options | December 31, 2018 Quebecor Quebecor Media TVA Group Risk-free interest rate 2.05 % 1.97 % 2.06 % Distribution yield 0.77 % 1.13 % — % Expected volatility 17.93 % 16.11 % 47.07 % Expected remaining life 4.8 years 1.5 years 5.2 years December 31, 2017 Quebecor Quebecor Media TVA Group Risk-free interest rate 1.83 % 1.80 % 1.97 % Distribution yield 0.46 % 1.12 % — % Expected volatility 17.58 % 16.70 % 50.78 % Expected remaining life 2.4 years 2.3 years 3.6 years |
Quebecor Stock option plan | |
STOCK-BASED COMPENSATION PLANS | |
Schedule of changes to outstanding options | 2018 2017 Weighted Weighted average average Options exercise price Options exercise price Balance at beginning of year 440,000 $ 12.31 1,360,000 $ 12.69 Granted 1,242,892 26.52 — — Exercised (100,000) 12.75 (630,000) 12.82 Cancelled (20,000) 26.52 (290,000) 12.97 Balance at end of year 1,562,892 23.40 440,000 12.31 Vested options at end of year 340,000 $ 12.17 376,666 $ 12.04 |
Schedule of information on exercise price of outstanding options | Outstanding options Vested options Weighted Weighted Weighted Range of average years average average exercise price Number to maturity exercise price Number exercise price $ 11.11 to 15.12 340,000 4.78 $ 12.17 340,000 $ 12.17 $ 26.52 1,222,892 9.78 26.52 — — $ 11.11 to 26.52 1,562,892 7.28 $ 23.40 340,000 $ 12.17 |
Quebecor Media stock option plan | |
STOCK-BASED COMPENSATION PLANS | |
Schedule of changes to outstanding options | 2018 2017 Weighted Weighted average average Options exercise price Options exercise price Balance at beginning of year 595,827 $ 62.84 980,905 $ 61.71 Exercised (263,227) 60.31 (215,978) 59.40 Cancelled (14,200) 70.06 (169,100) 60.65 Balance at end of year 318,400 $ 64.61 595,827 $ 62.84 Vested options at end of year 170,500 $ 61.07 226,200 $ 58.78 |
Schedule of information on exercise price of outstanding options | Outstanding options Vested options Weighted Weighted Weighted Range of average years average average exercise price Number to maturity exercise price Number exercise price $ 50.10 to 57.64 103,350 5.70 $ 56.05 40,500 $ 55.33 $ 63.50 to 70.56 215,050 5.30 67.88 130,000 68.29 $ 50.10 to 70.56 318,400 5.43 $ 64.61 170,500 $ 61.07 |
TVA Group stock option plan | |
STOCK-BASED COMPENSATION PLANS | |
Schedule of changes to outstanding options | 2018 2017 Weighted Weighted average average Options exercise price Options exercise price Balance at beginning of year 60,000 $ 6.85 357,632 $ 12.71 Granted 280,000 2.16 — — Cancelled — — (134,915) 12.86 Expired — — (162,717) 14.75 Balance at end of year 340,000 $ 2.99 60,000 $ 6.85 Vested options at end of year 36,000 $ 6.85 24,000 $ 6.85 |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | |
Schedule of accumulated other comprehensive loss | Cash flow Defined hedges benefit plans Total Balance as of December 31, 2015 $ (71.1) $ (64.9) $ (136.0) Other comprehensive (loss) income (15.1) 21.6 6.5 Balance as of December 31, 2016 (86.2) (43.3) (129.5) Other comprehensive income (loss) 71.7 (2.6) 69.1 Balance as of December 31, 2017 (14.5) (45.9) (60.4) Other comprehensive loss (15.8) (5.1) (20.9) Balance as of December 31, 2018 $ (30.3) $ (51.0) $ (81.3) |
COMMITMENTS (Tables)
COMMITMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
COMMITMENTS | |
Schedule of minimum payments | Other Leases commitments 2019 $ 49.5 $ 247.4 2020 to 2023 94.8 648.4 2024 and thereafter 96.7 455.7 |
FINANCIAL INSTRUMENTS AND FIN_2
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | |
Schedule of derivative financial instruments | (i) Foreign exchange forward contracts CAN dollar average exchange rate Notional Notional Maturity per one U.S. dollar amount sold amount bought Videotron Less than 1 year 1.3056 $ 165.6 US$ 126.8 (ii) Cross-currency interest rate swaps Hedging instrument CAN dollar Annual interest exchange rate on rate on notional interest and Period Notional amount in capital payments Hedged item covered amount CAN dollars per one U.S. dollar Quebecor Media 5.750% Senior Notes due 2023 2016 to 2023 US$ 431.3 7.27 % 0.9792 5.750% Senior Notes due 2023 2012 to 2023 US$ 418.7 6.85 % 0.9759 Term loan “B” 2013 to 2020 US$ 331.6 Bankers' % 1.0346 Videotron 5.000% Senior Notes due 2022 2014 to 2022 US$ 543.1 6.01 % 0.9983 5.000% Senior Notes due 2022 2012 to 2022 US$ 256.9 5.81 % 1.0016 5.375% Senior Notes due 2024 2014 to 2024 US$ 158.6 Bankers’ % 1.1034 5.375% Senior Notes due 2024 2017 to 2024 US$ 441.4 5.62 % 1.1039 5.125% Senior Notes due 2027 2017 to 2027 US$ 600.0 4.82 % 1.3407 US$ drawing on revolver facility 2018 to 2019 US$ 160.0 Bankers' % 1.3417 |
Schedule of carrying value and fair value of long-term debt and derivative financial instruments | 2018 2017 Carrying Fair Carrying Fair Asset (liability) value value value value Long-term debt 1 $ (6,408.2) $ (6,391.5) $ (5,346.7) $ (5,658.0) Derivative financial instruments 2 Foreign exchange forward contracts 6.7 6.7 (4.5) (4.5) Cross-currency interest rate swaps 880.3 880.3 562.2 562.2 1 The carrying value of long-term debt excludes adjustments to record changes in the fair value of long-term debt related to hedged interest risk and financing fees. 2 The fair value of derivative financial instruments designated as cash flow hedges is an asset position of $840.6 million as of December 31, 2018 ($525.7 million in 2017) and the fair value of derivative financial instruments designated as fair value hedges is an asset position of $46.4 million as of December 31, 2018 ($32.0 million in 2017). |
Schedule of allowance for doubtful accounts | 2018 2017 Balance at beginning of year $ 21.1 $ 28.1 Changes in expected credit losses charged to income 19.6 21.6 Write-off (20.2) (28.6) Balance at end of year $ 20.5 $ 21.1 |
Schedule of maturities of financial instruments | Less than 5 years Total 1 year 1-3 years 3-5 years or more Bank indebtedness $ 24.3 $ 24.3 $ — $ — $ — Accounts payable and accrued charges 820.5 820.5 — — — Long-term debt 1 6,408.2 56.6 448.1 3,492.2 2,411.3 Interest payments 2 1,500.6 252.3 578.2 428.4 241.7 Derivative financial instruments 3 (892.7) 0.2 (105.1) (618.1) (169.7) Total $ 7,860.9 $ 1,153.9 $ 921.2 $ 3,302.5 $ 2,483.3 1 The carrying value of long-term debt excludes adjustments to record changes in the fair value of long-term debt related to hedged interest rate risk and financing fees. 2 Estimate of interest payable on long-term debt, based on interest rates, hedging of interest rates and hedging of foreign exchange rates as of December 31, 2018. 3 Estimated future receipts, net of future disbursements, on derivative financial instruments related to foreign exchange hedging. |
Schedule of capital structure | 2018 2017 Bank indebtedness $ 24.3 $ — Long-term debt 6,375.0 5,311.7 Derivative financial instruments (887.0) (557.7) Cash and cash equivalents (21.0) (864.9) Loans to the parent corporation (596.1) — Net liabilities 4,895.2 3,889.1 Equity $ 1,424.7 $ 2,545.0 |
Foreign currency risk | |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | |
Schedule of estimated sensitivity on income and on other comprehensive income, before income tax | Other comprehensive Increase (decrease) Income income Increase of $0.10 $ 1.3 $ 34.8 Decrease of $0.10 (1.3) (34.8) |
Interest rate risk | |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | |
Schedule of estimated sensitivity on income and on other comprehensive income, before income tax | Other comprehensive Increase (decrease) Income income Increase of 100 basis points $ (1.9) $ (28.1) Decrease of 100 basis points 1.9 28.1 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
RELATED PARTY TRANSACTIONS | |
Schedule of key management personnel compensation | 2018 2017 2016 Salaries and short-term benefits $ 9.9 $ 9.1 $ 9.3 Share-based compensation 5.4 5.9 9.3 Other long-term benefits 1.2 8.5 1.3 $ 16.5 $ 23.5 $ 19.9 |
PENSION PLANS AND POSTRETIREM_2
PENSION PLANS AND POSTRETIREMENT BENEFITS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
PENSION PLANS AND POSTRETIREMENT BENEFITS | |
Schedule of reconciliation of the changes in the plans' benefit obligations and the fair value of plan assets | Pension benefits Postretirement benefits 2018 2017 2018 2017 Change in benefit obligations Benefit obligations at the beginning of the year $ 1,320.4 $ 1,274.9 $ 60.5 $ 73.4 Service costs 36.4 33.9 2.1 1.9 Interest costs 46.0 49.8 2.8 2.9 Plan participants’ contributions 11.1 11.5 — — Actuarial (gain) loss arising from: Financial assumptions (75.7) 82.1 20.5 5.4 Demographic assumptions — (8.6) (12.3) — Participant experience (1.1) 4.5 (0.5) (21.2) Benefits and settlements paid (55.1) (72.7) (1.7) (1.9) Plan transfer — (55.4) — — Other 1.2 0.4 — — Benefit obligations at the end of the year $ 1,283.2 $ 1,320.4 $ 71.4 $ 60.5 Change in plan assets Fair value of plan assets at the beginning of the year $ 1,267.3 $ 1,244.4 $ — $ — Actual return on plan assets (37.5) 106.5 — — Employer contributions 34.0 35.5 1.7 1.9 Plan participants’ contributions 11.1 11.5 — — Administrative fees (2.5) (2.5) — — Benefits and settlements paid (55.1) (72.7) (1.7) (1.9) Plan transfer — (55.4) — — Fair value of plan assets at the end of the year $ 1,217.3 $ 1,267.3 $ — $ — |
Schedule of fair value of plan assets | 2018 2017 Equity securities: Canadian 21.1 % 23.6 % Foreign 31.2 32.3 Debt securities 46.6 40.8 Other 1.1 3.3 100.0 % 100.0 % |
Schedule of reconciliation of funded status to the net amount | Pension benefits Postretirement benefits 2018 2017 2018 2017 Benefit obligations $ (1,283.2) $ (1,320.4) $ (71.4) $ (60.5) Fair value of plan assets 1,217.3 1,267.3 — — Plan deficit (65.9) (53.1) (71.4) (60.5) Asset limit and minimum funding adjustment (16.0) (20.4) — — Net amount recognized 1 $ (81.9) $ (73.5) $ (71.4) $ (60.5) 1 The net liability recognized for 2018 is $153.9 million and is included in “Other Liabilities” (note 21) (an asset of $2.9 million was included in “Other assets” in 2017 and a liability of $136.9 million was included in “Other liabilities” in 2017). |
Schedule of components of re-measurements | Pension benefits Postretirement benefits 2018 2017 2016 2018 2017 2016 Actuarial gain (loss) on benefit obligations $ 76.8 $ (78.0) $ (20.1) $ (7.7) $ 15.8 $ (1.4) Actual return on plan assets, less interest income anticipated in the interest on the net defined benefit liability calculation (80.9) 59.1 51.8 — — — Asset limit and minimum funding adjustment 5.0 (0.1) 2.8 — — — Re-measurements gain (loss) recorded in other comprehensive income $ 0.9 $ (19.0) $ 34.5 $ (7.7) $ 15.8 $ (1.4) |
Schedule of components of net benefit costs | Pension benefits Postretirement benefits 2018 2017 2016 2018 2017 2016 Employee costs: Service costs $ 36.4 $ 33.9 $ 34.9 $ 2.1 $ 1.9 $ 1.8 Administrative fees and other 3.7 3.0 3.0 — — — Interest on net defined benefit liability 3.4 2.9 3.9 2.8 2.9 2.8 Net benefit costs $ 43.5 $ 39.8 $ 41.8 $ 4.9 $ 4.8 $ 4.6 |
Schedule of actuarial assumptions used in measuring the Corporation's benefit obligations | Pension and postretirement benefits 2018 2017 2016 Benefit obligations Rates as of year-end: Discount rate 3.90 % 3.50 % 3.90 % Rate of compensation increase 3.00 3.00 3.00 Current periodic costs Rates as of preceding year-end: Discount rate 3.50 % 3.90 % 4.00 % Rate of compensation increase 3.00 3.00 3.00 |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
DISCONTINUED OPERATIONS | |
Summary of consolidated statements of income and comprehensive income and cash flows | 2018 2017 2016 Revenues $ 19.8 $ 19.7 $ 12.0 Expenses 14.6 14.8 10.6 Income taxes 1.4 1.3 0.4 Gain related to a business sold in 2015 — (14.6) — Income from discontinued operations $ 3.8 $ 18.2 $ 1.0 2018 2017 2016 Cash flows related to operating activities $ 10.4 $ 20.4 $ 3.3 Cash flows related to investing activities (1.9) (3.5) (53.1) Cash flows provided by (used in) discontinued operations $ 8.5 $ 16.9 $ (49.8) |
Summary of consolidated statements of balance sheet | 2018 Current assets $ 1.3 Property, plant and equipment 72.5 Intangible assets and goodwill 21.2 Assets held for sale 95.0 Current liabilities held for sale (6.6) Net assets held for sale $ 88.4 |
NON-CONSOLIDATED FINANCIAL ST_2
NON-CONSOLIDATED FINANCIAL STATEMENTS OF THE CORPORATION (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
NON-CONSOLIDATED FINANCIAL STATEMENTS OF THE CORPORATION | |
Schedule of information related to non-consolidated condensed statements of income and comprehensive income | 2018 2017 2016 Revenues: Distributions in excess of the investments in subsidiaries $ 503.3 $ — $ — Dividends 113.0 295.0 282.0 Management fees 59.2 58.8 59.9 Interest on loans to the parent corporation 14.8 — — Other 64.5 49.5 52.4 754.8 403.3 394.3 General and administrative expenses 126.8 123.6 121.7 Depreciation and amortization 3.8 4.3 3.3 Financial expenses 106.1 130.3 138.9 Loss (gain) on valuation and translation of financial instruments 0.2 (0.7) — Loss on debt refinancing — 10.4 — Impairment and disposal of investments in subsidiaries — — 73.3 Loss on notes receivable from subsidiaries — — 14.8 Other 2.4 (10.9) 2.0 Income before income taxes 515.5 146.3 40.3 Income taxes (recovery) (5.3) 0.6 1.7 Net income 520.8 145.7 38.6 Other comprehensive (loss) gain (3.9) 22.8 (3.3) Comprehensive income $ 516.9 $ 168.5 $ 35.3 |
Schedule of information related to non-consolidated and condensed statements of cash flows | 2018 2017 2016 Cash flows related to operations Net income $ 520.8 $ 145.7 $ 38.6 Depreciation and amortization 3.8 4.3 3.3 Loss (gain) on valuation and translation of financial instruments 0.2 (0.7) — Amortization of financing costs and long-term debt discount 2.3 2.4 2.8 Loss on debt refinancing — 10.4 — Impairment and disposal of investments in subsidiaries — — 73.3 Loss on notes receivable from subsidiaries — — 14.8 Deferred income taxes (5.3) 2.5 1.8 Other 0.2 2.4 (0.3) Net change in non-cash balances related to operations 5.3 39.3 7.5 Cash flows provided by operations 527.3 206.3 141.8 Cash flows related to investing activities Net change in investments in subsidiaries 2,058.6 (8.5) (63.5) Acquisition of tax deductions from the parent corporation (13.9) — (14.0) Other (6.0) (8.5) 3.9 Cash flows provided by (used in) investing activities 2,038.7 (17.0) (73.6) Cash flows related to financing activities Net change in bank indebtedness 5.7 (2.5) (8.1) Net change under revolving facilities — — (2.8) Repayment of long-term debt (3.6) (336.7) (3.6) Settlement of hedging contracts (1.6) (1.6) 5.2 Repurchase of Common Shares (1,540.0) (43.9) — Repurchase of redeemable preferred shares issued to subsidiaries — — (430.0) Dividends and reduction of paid-up capital (100.0) (100.0) (100.0) Net change in subordinated loans from subsidiaries 2,322.0 66.0 (2,768.0) Net change in convertible obligations, subordinated loans and notes receivable – subsidiaries (2,664.0) 276.0 3,199.0 Net change in loans to the parent corporation (596.1) — — Net change in advances to or from subsidiaries (19.6) (15.4) 40.1 Cash flows used in financing activities (2,597.2) (158.1) (68.2) Net change in cash and cash equivalents (31.2) 31.2 — Cash and cash equivalents at the beginning of the year 31.2 — — Cash and cash equivalents at the end of the year $ — $ 31.2 $ — |
Schedule of information related to non-consolidated and condensed balance sheets | 2018 2017 Assets Current assets $ 144.2 $ 161.8 Investments in subsidiaries at cost 477.8 2,536.4 Advances to subsidiaries 48.9 35.7 Convertible obligations, subordinated loans and notes receivable – subsidiaries 2,813.0 149.0 Loans to the parent corporation 596.1 — Other assets 488.9 347.2 $ 4,568.9 $ 3,230.1 Liabilities and equity Current liabilities $ 87.6 $ 66.3 Long-term debt 2,098.9 1,974.8 Advances from subsidiaries 138.8 145.2 Other liabilities 37.6 36.7 Subordinated loan from subsidiaries 2,813.0 491.0 Equity attributable to shareholders (607.0) 516.1 $ 4,568.9 $ 3,230.1 |
SEGMENTED INFORMATION - Subsidi
SEGMENTED INFORMATION - Subsidiaries (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Videotron | |
Percentages of voting rights and equity in its major subsidiaries | |
% voting | 100.00% |
% equity | 100.00% |
TVA Group | |
Percentages of voting rights and equity in its major subsidiaries | |
% voting | 99.90% |
% equity | 68.40% |
Media QMI Inc | |
Percentages of voting rights and equity in its major subsidiaries | |
% voting | 100.00% |
% equity | 100.00% |
QMI Spectacles Inc. | |
Percentages of voting rights and equity in its major subsidiaries | |
% voting | 100.00% |
% equity | 100.00% |
SEGMENTED INFORMATION - Additio
SEGMENTED INFORMATION - Additional information (Details) | 12 Months Ended |
Dec. 31, 2018item | |
Sports and Entertainment | |
Percentages of voting rights and equity in its major subsidiaries | |
Number of teams | 2 |
SEGMENTED INFORMATION - Segment
SEGMENTED INFORMATION - Segment information (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
SEGMENTED INFORMATION | |||
Revenues | $ 4,181 | $ 4,125.1 | $ 4,057.1 |
Employee costs | 696.6 | 706.2 | 707.9 |
Purchase of goods and services | 1,752 | 1,799.7 | 1,789.9 |
Adjusted EBITDA | 1,732.4 | 1,619.2 | 1,559.3 |
Depreciation and amortization | 717.9 | 705.3 | 648.5 |
Financial expenses | 280.5 | 281.8 | 302 |
Loss on valuation and translation of financial instruments | 0.9 | 2.4 | 2.1 |
Restructuring of operations, litigation and other items | 29.8 | 17.2 | 28.5 |
Gain on sale of spectrum licences | (330.9) | ||
Impairment of goodwill and intangible assets | 43.8 | 40.9 | |
Loss on debt refinancing | 15.6 | 7.3 | |
Income before income taxes | 703.3 | 884 | 530 |
Additions to property, plant and equipment | 552.7 | 601.8 | 654.5 |
Additions to intangible assets | 197.4 | 141.9 | 139.8 |
Operating Segments | Telecommunications | |||
SEGMENTED INFORMATION | |||
Revenues | 3,382 | 3,287.8 | 3,192.3 |
Employee costs | 387.1 | 388.8 | 379.7 |
Purchase of goods and services | 1,317.9 | 1,341.2 | 1,301.7 |
Adjusted EBITDA | 1,677 | 1,557.8 | 1,510.9 |
Additions to property, plant and equipment | 516.7 | 570.9 | 613.7 |
Additions to intangible assets | 190.2 | 132.3 | 125.6 |
Operating Segments | Media | |||
SEGMENTED INFORMATION | |||
Revenues | 728.6 | 769.9 | 789.2 |
Employee costs | 234.4 | 232 | 242.4 |
Purchase of goods and services | 438.9 | 468.6 | 492.9 |
Adjusted EBITDA | 55.3 | 69.3 | 53.9 |
Additions to property, plant and equipment | 28.7 | 29.4 | 37.2 |
Additions to intangible assets | 4.8 | 3.3 | 7.5 |
Operating Segments | Sports and Entertainment | |||
SEGMENTED INFORMATION | |||
Revenues | 182.1 | 181.3 | 185 |
Employee costs | 38.8 | 37.6 | 38.3 |
Purchase of goods and services | 138.3 | 137.5 | 144.4 |
Adjusted EBITDA | 5 | 6.2 | 2.3 |
Additions to property, plant and equipment | 1.5 | 1.3 | 3.5 |
Additions to intangible assets | 3.5 | 4.3 | 3.5 |
Head Office and Intersegments | |||
SEGMENTED INFORMATION | |||
Revenues | (111.7) | (113.9) | (109.4) |
Employee costs | 36.3 | 47.8 | 47.5 |
Purchase of goods and services | (143.1) | (147.6) | (149.1) |
Adjusted EBITDA | (4.9) | (14.1) | (7.8) |
Additions to property, plant and equipment | 5.8 | 0.2 | 0.1 |
Additions to intangible assets | $ (1.1) | $ 2 | $ 3.2 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Retroactive adoption of IFRS 15 - Consolidated statements of income and comprehensive income (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenues | $ 4,181 | $ 4,125.1 | $ 4,057.1 |
Purchase of goods and services | 1,752 | 1,799.7 | 1,789.9 |
Deferred income tax expense | 11.7 | 132.4 | (14.7) |
Net income attributable to shareholders | 538.1 | 765.8 | 400.3 |
Comprehensive income attributable to shareholders | $ 517.2 | 834.9 | 406.8 |
Increase (decrease) due to application of IFRS 15 | |||
Revenues | 22.4 | 52.5 | |
Purchase of goods and services | (12.4) | (13.2) | |
Deferred income tax expense | 9.2 | 17.4 | |
Net income attributable to shareholders | 25.6 | 48.3 | |
Comprehensive income attributable to shareholders | $ 25.6 | $ 48.3 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Retroactive adoption of IFRS 15 - Consolidated balance sheets (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Contract assets | $ 204.9 | $ 183.6 | |
Contract costs | 103 | 102.9 | |
Deferred income tax liability | 744.7 | 724.1 | $ 604.2 |
Deficit | (1,603.8) | (1,113) | (1,805.5) |
Current contract assets | 144.4 | 132.8 | 106.6 |
Current portion of contract costs (included in "Other current assets") | $ 53.4 | 55.9 | 49.4 |
Increase (decrease) due to application of IFRS 15 | |||
Contract assets | 183.6 | 155.8 | |
Contract costs | 92.5 | 85.4 | |
Deferred income tax liability | 73.2 | 63.9 | |
Deficit | $ (202.9) | $ (177.3) |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Estimated useful life of property, plant and equipment (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Buildings | Minimum | |
PROPERTY, PLANT AND EQUIPMENT | |
Estimated useful life of fixed assets | P10Y |
Buildings | Maximum | |
PROPERTY, PLANT AND EQUIPMENT | |
Estimated useful life of fixed assets | P40Y |
Leasehold improvements | Minimum | |
PROPERTY, PLANT AND EQUIPMENT | |
Estimated useful life of fixed assets | P10Y |
Leasehold improvements | Maximum | |
PROPERTY, PLANT AND EQUIPMENT | |
Estimated useful life of fixed assets | P40Y |
Machinery | Minimum | |
PROPERTY, PLANT AND EQUIPMENT | |
Estimated useful life of fixed assets | P3Y |
Machinery | Maximum | |
PROPERTY, PLANT AND EQUIPMENT | |
Estimated useful life of fixed assets | P20Y |
Equipment | Minimum | |
PROPERTY, PLANT AND EQUIPMENT | |
Estimated useful life of fixed assets | P3Y |
Equipment | Maximum | |
PROPERTY, PLANT AND EQUIPMENT | |
Estimated useful life of fixed assets | P20Y |
Telecommunication networks | Minimum | |
PROPERTY, PLANT AND EQUIPMENT | |
Estimated useful life of fixed assets | P3Y |
Telecommunication networks | Maximum | |
PROPERTY, PLANT AND EQUIPMENT | |
Estimated useful life of fixed assets | P20Y |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Estimated useful life of intangible assets (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Software | Minimum | |
INTANGIBLE ASSETS | |
Estimated useful life of intangible assets | P3Y |
Software | Maximum | |
INTANGIBLE ASSETS | |
Estimated useful life of intangible assets | P7Y |
Naming rights | |
INTANGIBLE ASSETS | |
Estimated useful life of intangible assets | P25Y |
Customer relationships | Minimum | |
INTANGIBLE ASSETS | |
Estimated useful life of intangible assets | P3Y |
Customer relationships | Maximum | |
INTANGIBLE ASSETS | |
Estimated useful life of intangible assets | P10Y |
Other | Minimum | |
INTANGIBLE ASSETS | |
Estimated useful life of intangible assets | P3Y |
Other | Maximum | |
INTANGIBLE ASSETS | |
Estimated useful life of intangible assets | P10Y |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Retroactive adoption of IFRS 16 - Consolidated statements of income and comprehensive income (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Purchase of goods and services | $ 1,752 | $ 1,799.7 | $ 1,789.9 |
Depreciation and amortisation expense | 717.9 | 705.3 | 648.5 |
Financial expenses | 280.5 | 281.8 | 302 |
Restructuring of operations, litigation and other items | 29.8 | 17.2 | 28.5 |
Deferred income tax expense | 11.7 | 132.4 | (14.7) |
Net income attributable to shareholders | 540.5 | 761 | 387.7 |
Comprehensive income attributable to shareholders | 519.8 | 830.4 | 396.9 |
Net income attributable to shareholders | 538.1 | 765.8 | 400.3 |
Comprehensive income attributable to shareholders | 513.4 | 816.7 | 405.8 |
Non-controlling interests | 2.4 | (4.8) | $ (12.6) |
Increase (decrease) due to application of IFRS 16 | |||
Purchase of goods and services | (52.5) | (49.8) | |
Depreciation and amortisation expense | 38.9 | 37.8 | |
Financial expenses | 11 | 12.5 | |
Restructuring of operations, litigation and other items | (0.7) | 0.3 | |
Deferred income tax expense | 0.9 | (0.2) | |
Net income attributable to shareholders | 2.4 | (0.6) | |
Comprehensive income attributable to shareholders | 2.4 | (0.6) | |
Net income attributable to shareholders | 2.2 | (0.5) | |
Comprehensive income attributable to shareholders | 2.2 | (0.5) | |
Non-controlling interests | $ 0.2 | $ (0.1) |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Retroactive adoption of IFRS 16 - Consolidated balance sheets (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Other liabilities | $ 213.3 | $ 195 | $ 202.8 |
Deferred income tax liability | 744.7 | 724.1 | 604.2 |
Deficit | (1,603.8) | (1,113) | (1,805.5) |
Non-controlling interest | 88.8 | 86.3 | $ 90.8 |
Current portion of lease liabilities | 37.4 | 40.3 | |
Increase (decrease) due to application of IFRS 16 | |||
Right-of-use assets | 146.7 | 170.1 | |
Provisions | (1.4) | (1.4) | |
Lease liabilities | 179.5 | 205.2 | |
Other liabilities | (4.3) | (3.4) | |
Deferred income tax liability | (7.1) | (8) | |
Deficit | 19.8 | 21.9 | |
Non-controlling interest | $ (0.2) | $ (0.4) |
REVENUES (Details)
REVENUES (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
REVENUES | |||
Revenues | $ 4,181 | $ 4,125.1 | $ 4,057.1 |
Internet | |||
REVENUES | |||
Revenues | 1,079.3 | 1,030.9 | 978.7 |
Cable television | |||
REVENUES | |||
Revenues | 996.7 | 1,009.6 | 1,024.3 |
Mobile telephony | |||
REVENUES | |||
Revenues | 534.4 | 469.8 | 409.6 |
Cable telephony | |||
REVENUES | |||
Revenues | 368.6 | 397.8 | 424.8 |
Telecommunication equipment sales | |||
REVENUES | |||
Revenues | 233.5 | 219 | 206.9 |
Connection and data services | |||
REVENUES | |||
Revenues | 108.2 | 104.8 | 99.2 |
Over-the-top video | |||
REVENUES | |||
Revenues | 47 | 39.7 | 31.4 |
Advertising - television | |||
REVENUES | |||
Revenues | 246.1 | 267.5 | 254.8 |
Subscription - television | |||
REVENUES | |||
Revenues | 126.2 | 125 | 119.9 |
Soundstage and equipment leasing and post-production services | |||
REVENUES | |||
Revenues | 68.4 | 67.1 | 59.3 |
Advertising - newspapers and magazines | |||
REVENUES | |||
Revenues | 106 | 125.4 | 148 |
Circulation and other - newspapers and magazines | |||
REVENUES | |||
Revenues | 146 | 152.7 | 168.9 |
Other | |||
REVENUES | |||
Revenues | $ 120.6 | $ 115.8 | $ 131.3 |
EMPLOYEE COSTS AND PURCHASE O_3
EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES | |||
Employee costs | $ 895.9 | $ 893.6 | $ 891.2 |
Less employee costs capitalized to property, plant and equipment and to intangible assets | (199.3) | (187.4) | (183.3) |
Net employee costs | 696.6 | 706.2 | 707.9 |
Purchase of goods and services: | |||
Royalties, rights and creation costs | 681.7 | 677.9 | 701.9 |
Cost of products sold | 380.2 | 360.1 | 338.3 |
Service contracts | 154.3 | 172.3 | 168.7 |
Marketing, circulation and distribution expenses | 105.9 | 108.9 | 113.8 |
Building expenses | 97.9 | 99.5 | 92.5 |
Other | 332 | 381 | 374.7 |
Total purchase of goods and services | 1,752 | 1,799.7 | 1,789.9 |
Total employee costs and purchase of goods and services | $ 2,448.6 | $ 2,505.9 | $ 2,497.8 |
FINANCIAL EXPENSES (Details)
FINANCIAL EXPENSES (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
FINANCIAL EXPENSES | |||
Interest on long-term debt | $ 287.8 | $ 274.7 | $ 288 |
Amortization of financing costs and long-term debt discount | 6.8 | 6.9 | 7 |
Interest on net defined benefit liability | 6.2 | 5.8 | 6.7 |
Loss (gain) on foreign currency translation on short-term monetary items | 2.3 | (2) | 0.5 |
Interest from the parent corporation | (14.8) | ||
Other | (7.8) | (3.6) | (0.2) |
Total financial expenses | $ 280.5 | $ 281.8 | $ 302 |
RESTRUCTURING OF OPERATIONS, _2
RESTRUCTURING OF OPERATIONS, LITIGATION AND OTHER ITEMS (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
RESTRUCTURING OF OPERATIONS, LITIGATION AND OTHER ITEMS | |||
Restructuring of operations | $ 14.9 | ||
Restructuring of operations, litigation and other items | 29.8 | $ 17.2 | $ 28.5 |
Impairment charge on assets | $ 14.9 |
GAIN ON SALE OF SPECTRUM LICE_2
GAIN ON SALE OF SPECTRUM LICENCES (Details) $ in Millions | Jul. 24, 2017CAD ($)Asset | Jun. 20, 2017CAD ($) | Dec. 31, 2018CAD ($) | Dec. 31, 2017CAD ($) | Dec. 31, 2016CAD ($) |
GAIN ON SALE OF SPECTRUM LICENCES | |||||
Gain on sale of spectrum licences | $ 330.9 | ||||
Income taxes (recovery) | $ 166.6 | 141.2 | $ 143.3 | ||
Spectrum licence | |||||
GAIN ON SALE OF SPECTRUM LICENCES | |||||
Income taxes (recovery) | $ (44.4) | ||||
AWS spectrum licence | Videotron | |||||
GAIN ON SALE OF SPECTRUM LICENCES | |||||
Cash consideration | $ 184.2 | ||||
Gain on sale of spectrum licences | $ 87.8 | ||||
2500 MHz and 700 MHz wireless spectrum licences | Videotron | |||||
GAIN ON SALE OF SPECTRUM LICENCES | |||||
Cash consideration | $ 430 | ||||
Gain on sale of spectrum licences | $ 243.1 | ||||
Number of intangible assets sold | Asset | 7 |
IMPAIRMENT OF GOODWILL AND OT_3
IMPAIRMENT OF GOODWILL AND OTHER ASSETS - Tabular disclosure (Details) - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
IMPAIRMENT OF GOODWILL AND OTHER ASSETS | ||
Impairment of goodwill | $ 30 | $ 40.1 |
Impairment of intangible assets | 13.8 | 0.8 |
Total impairment loss | $ 43.8 | $ 40.9 |
IMPAIRMENT OF GOODWILL AND OT_4
IMPAIRMENT OF GOODWILL AND OTHER ASSETS - Additional information (Details) - CAD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
IMPAIRMENT OF GOODWILL AND OTHER ASSETS | ||||
Impairment of goodwill | $ 30 | $ 40.1 | ||
Impairment of intangible assets | 13.8 | 0.8 | ||
Magazines CGU | ||||
IMPAIRMENT OF GOODWILL AND OTHER ASSETS | ||||
Impairment of goodwill | $ 30 | |||
Impairment of goodwill without tax consequence | 1.5 | $ 40.1 | ||
Impairment of intangible assets | 12.4 | |||
Impairment of intangible assets without tax consequence | $ 3.1 | |||
Other segments excluding Magazines CGU | ||||
IMPAIRMENT OF GOODWILL AND OTHER ASSETS | ||||
Impairment of intangible assets | $ 1.4 | $ 0.8 |
LOSS ON DEBT REFINANCING (Detai
LOSS ON DEBT REFINANCING (Details) - CAD ($) $ in Millions | May 01, 2017 | Jan. 05, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 02, 2016 |
Long-term debt | ||||||
Redeemed for cash consideration | $ 19.2 | $ 664.5 | $ 19 | |||
Loss on debt refinancing | 15.6 | 7.3 | ||||
Parent Company | ||||||
Long-term debt | ||||||
Redeemed for cash consideration | $ 3.6 | 336.7 | $ 3.6 | |||
Loss on debt refinancing | $ 10.4 | |||||
Parent Company | 7.375% Senior Notes | ||||||
Long-term debt | ||||||
Principal amount | $ 325 | |||||
Interest rate (as a percent) | 7.375% | |||||
Redeemed for cash consideration | $ 333 | |||||
Subsidiaries | Videotron | 6.875% Senior Notes | ||||||
Long-term debt | ||||||
Principal amount | $ 125 | $ 175 | ||||
Interest rate (as a percent) | 6.875% | 6.875% | ||||
Redeemed for cash consideration | $ 129.3 | $ 181 |
INCOME TAXES - Reconciliation o
INCOME TAXES - Reconciliation of income tax expense (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
INCOME TAXES | |||
Domestic statutory tax rate (in percent) | 26.70% | 26.80% | 26.90% |
Income taxes at domestic statutory tax rate | $ 187.8 | $ 236.9 | $ 142.5 |
(Reduction) increase resulting from: | |||
Effect of non-deductible charges, non-taxable income and differences between current and future tax rates | (1.2) | (48.5) | 1 |
Change in benefit arising from the recognition of current and prior year tax losses (note 6 and 30) | (18.5) | (47) | (0.5) |
Non-deductible impairment of goodwill | 0.4 | 10.8 | |
Change in deferred tax balances due to a change in substantively enacted tax rates | (6.4) | ||
Effect of tax consolidation transactions with the parent corporation | (0.3) | ||
Other | (1.5) | (0.6) | (3.8) |
Income taxes | $ 166.6 | $ 141.2 | $ 143.3 |
INCOME TAXES - Components of de
INCOME TAXES - Components of deferred income tax (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Deferred income taxes | |||
Deferred tax liability, net | $ (692.9) | $ (690.9) | $ (588.2) |
Deferred tax expense (income) | 11.7 | 132.4 | (14.7) |
Loss carryforwards | |||
Deferred income taxes | |||
Deferred tax liability, net | 22.8 | 0.4 | |
Deferred tax expense (income) | (8) | 3.6 | 2.9 |
Accounts payable, accrued charges, provisions and deferred revenue | |||
Deferred income taxes | |||
Deferred tax liability, net | 13.9 | 14.5 | |
Deferred tax expense (income) | 0.6 | 1.4 | (4) |
Defined benefit plans | |||
Deferred income taxes | |||
Deferred tax liability, net | 40.6 | 35.5 | |
Deferred tax expense (income) | (3.2) | (1.9) | (2.2) |
Contract assets | |||
Deferred income taxes | |||
Deferred tax liability, net | (54.3) | (48.5) | |
Deferred tax expense (income) | 5.8 | 7.4 | 14.3 |
Property, plant and equipment | |||
Deferred income taxes | |||
Deferred tax liability, net | (471.7) | (488.1) | |
Deferred tax expense (income) | (16.4) | 84.5 | 12.3 |
Goodwill, intangible assets and other assets | |||
Deferred income taxes | |||
Deferred tax liability, net | (233.4) | (199.4) | |
Deferred tax expense (income) | 34 | 43.9 | 25.8 |
Long-term debt and derivative financial instruments | |||
Deferred income taxes | |||
Deferred tax liability, net | (21) | (14) | |
Deferred tax expense (income) | 1.3 | (7.4) | 0.3 |
Benefits from a general partnership | |||
Deferred income taxes | |||
Deferred tax expense (income) | (0.6) | (67) | |
Other | |||
Deferred income taxes | |||
Deferred tax liability, net | 10.2 | 8.7 | |
Deferred tax expense (income) | $ (2.4) | $ 1.5 | $ 2.9 |
INCOME TAXES - Changes in defer
INCOME TAXES - Changes in deferred income tax liability (Details) - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Changes in the net deferred income tax liability | ||
Balance at beginning of year | $ (690.9) | $ (588.2) |
Recognized in income as continuing operations | (11.7) | (132.4) |
Recognized in other comprehensive income | (3.8) | 28.9 |
Acquisition of tax deductions | (14.4) | |
Other | (0.9) | 0.8 |
Balance at end of year | $ (692.9) | $ (690.9) |
INCOME TAXES - Net deferred inc
INCOME TAXES - Net deferred income tax liability (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
INCOME TAXES | |||
Deferred income tax asset | $ 51.8 | $ 33.2 | $ 16 |
Deferred income tax liability | (744.7) | (724.1) | (604.2) |
Net deferred income tax liability | $ (692.9) | $ (690.9) | $ (588.2) |
INCOME TAXES - Additional infor
INCOME TAXES - Additional information (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
INCOME TAXES | |||
Loss carryforwards for income tax purposes available to reduce future taxable income | $ 17.3 | ||
Capital losses that can be carried forward indefinitely and applied only against future capital gains | 589.8 | ||
Capital gain recognized during the period | 139 | ||
Income tax consequences attached to the payment of dividends or distributions | $ 0 | $ 0 | $ 0 |
BUSINESS ACQUISITIONS - Busines
BUSINESS ACQUISITIONS - Business acquisitions (Details) - CAD ($) $ in Millions | Jan. 07, 2016 | Feb. 28, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2016 |
Business acquisitions | ||||||
Business acquisitions | $ 10.3 | $ 5.8 | $ 119.5 | |||
2018 Acquisition | Sports and Entertainment | ||||||
Business acquisitions | ||||||
Purchase price | $ 10.3 | |||||
2017 Acquisition | Sports and Entertainment | ||||||
Business acquisitions | ||||||
Purchase price | $ 0.2 | |||||
2016 Acquisition | ||||||
Business acquisitions | ||||||
Balance consideration paid, prior acquisitions | $ 0.6 | |||||
Videotron | 2016 Acquisition | ||||||
Business acquisitions | ||||||
Purchase price | $ 125 | |||||
Amount paid, net of cash acquired | 119.1 | |||||
Cash | $ 1.8 | |||||
Post-closing adjustment | $ (0.2) | |||||
Business acquisitions | $ 5.6 | |||||
Interest paid on balance payable | $ 0.3 |
BUSINESS ACQUISITIONS - Purchas
BUSINESS ACQUISITIONS - Purchase price allocation (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Consideration | |||
Goodwill deductible for tax purposes | $ 0.6 | $ 0 | $ 0.1 |
Business acquisitions | |||
Assets acquired and Liability assumed | |||
Non-cash current assets | 5.5 | ||
Property, plant and equipment | 32.7 | ||
Intangible assets | 15.6 | ||
Goodwill | 87.1 | ||
Total assets acquired | 140.9 | ||
Non-cash current liabilities | (3.1) | ||
Deferred income taxes | (7.5) | ||
Other long-term liabilities | (5.7) | ||
Total liabilities assumed | (16.3) | ||
Net assets acquired at fair value | 124.6 | ||
Consideration | |||
Cash, net of cash acquired | 119 | ||
Balance payable | 5.6 | ||
Total consideration transferred, acquisition-date fair value | $ 124.6 |
ACCOUNTS RECEIVABLE - Tabular d
ACCOUNTS RECEIVABLE - Tabular disclosure (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
ACCOUNTS RECEIVABLE | |||
Accounts receivable | $ 468 | $ 486.4 | |
Other | 94.1 | 56.6 | |
Total | $ 562.1 | $ 543 | $ 525 |
ACCOUNTS RECEIVABLE - Additiona
ACCOUNTS RECEIVABLE - Additional information (Details) $ in Millions | Dec. 31, 2018CAD ($) |
Parent | |
Disclosure of transactions between related parties [line items] | |
Current interest receivable | $ 8.6 |
INVENTORIES (Details)
INVENTORIES (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
INVENTORIES | |||
Finished goods | $ 88.8 | $ 87.6 | |
Programs, broadcast and distribution rights | 77.3 | 78.2 | |
Raw materials and supplies | 20.2 | 22.3 | |
Total current inventories | 186.3 | 188.1 | $ 183.3 |
Cost of inventories included in purchase of goods and services | 721.5 | 721 | 738.3 |
Write-downs of inventories | $ 4.7 | $ 11.1 | $ 6.8 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Changes in the net carrying amount of property, plant and equipment | |||
Balance at the beginning of the year | $ 3,554.3 | $ 3,562.5 | |
Balance at the end of the year | 3,413.5 | 3,554.3 | $ 3,562.5 |
Cost | |||
Changes in the net carrying amount of property, plant and equipment | |||
Balance at the beginning of the year | 8,312.1 | 7,878.8 | |
Additions | 552.7 | 601.8 | |
Net change in additions financed with accounts payable | 3.2 | (4.4) | |
Reclassification to assets held for sale | (84) | ||
Retirement, disposals and other | (279.2) | (164.1) | |
Balance at the end of the year | 8,504.8 | 8,312.1 | 7,878.8 |
Accumulated depreciation and impairment losses | |||
Changes in the net carrying amount of property, plant and equipment | |||
Balance at the beginning of the year | (4,757.8) | (4,316.3) | |
Reclassification to assets held for sale | 11.5 | ||
Depreciation | 612.4 | 601.5 | |
Retirement, disposals and other | 267.4 | 160 | |
Balance at the end of the year | (5,091.3) | (4,757.8) | (4,316.3) |
Land, buildings and leasehold improvements | |||
Changes in the net carrying amount of property, plant and equipment | |||
Balance at the beginning of the year | 391.2 | ||
Balance at the end of the year | 318 | 391.2 | |
Land, buildings and leasehold improvements | Cost | |||
Changes in the net carrying amount of property, plant and equipment | |||
Balance at the beginning of the year | 612.9 | 573.6 | |
Additions | 20 | 35.9 | |
Reclassification | 2.1 | ||
Reclassification to assets held for sale | (84) | ||
Retirement, disposals and other | (6.6) | 3.4 | |
Balance at the end of the year | 544.4 | 612.9 | 573.6 |
Land, buildings and leasehold improvements | Accumulated depreciation and impairment losses | |||
Changes in the net carrying amount of property, plant and equipment | |||
Balance at the beginning of the year | (221.7) | (200) | |
Reclassification to assets held for sale | 11.5 | ||
Depreciation | 18.8 | 18.4 | |
Retirement, disposals and other | 2.6 | (3.3) | |
Balance at the end of the year | (226.4) | (221.7) | (200) |
Machinery and equipment | |||
Changes in the net carrying amount of property, plant and equipment | |||
Balance at the beginning of the year | 529.5 | ||
Balance at the end of the year | 492.3 | 529.5 | |
Machinery and equipment | Cost | |||
Changes in the net carrying amount of property, plant and equipment | |||
Balance at the beginning of the year | 1,751.2 | 1,663.6 | |
Additions | 151.4 | 145.5 | |
Net change in additions financed with accounts payable | 1.8 | (2) | |
Reclassification | 3.1 | 14.4 | |
Retirement, disposals and other | (35.3) | (70.3) | |
Balance at the end of the year | 1,872.2 | 1,751.2 | 1,663.6 |
Machinery and equipment | Accumulated depreciation and impairment losses | |||
Changes in the net carrying amount of property, plant and equipment | |||
Balance at the beginning of the year | (1,221.7) | (1,088.3) | |
Depreciation | 191.8 | 199.1 | |
Retirement, disposals and other | 33.6 | 65.7 | |
Balance at the end of the year | (1,379.9) | (1,221.7) | (1,088.3) |
Telecommunication networks | |||
Changes in the net carrying amount of property, plant and equipment | |||
Balance at the beginning of the year | 2,587.4 | ||
Balance at the end of the year | 2,512.2 | 2,587.4 | |
Telecommunication networks | Cost | |||
Changes in the net carrying amount of property, plant and equipment | |||
Balance at the beginning of the year | 5,901.8 | 5,549.1 | |
Additions | 297.3 | 364.4 | |
Net change in additions financed with accounts payable | (11.9) | (3.4) | |
Reclassification | 41.5 | 90.1 | |
Retirement, disposals and other | (231.5) | (98.4) | |
Balance at the end of the year | 5,997.2 | 5,901.8 | 5,549.1 |
Telecommunication networks | Accumulated depreciation and impairment losses | |||
Changes in the net carrying amount of property, plant and equipment | |||
Balance at the beginning of the year | (3,314.4) | (3,028) | |
Depreciation | 401.8 | 384 | |
Retirement, disposals and other | 231.2 | 97.6 | |
Balance at the end of the year | (3,485) | $ (3,314.4) | $ (3,028) |
Telecommunication networks, component | |||
Changes in the net carrying amount of property, plant and equipment | |||
Estimated useful life of fixed assets | P5Y | P15Y | |
Increase in depreciation | $ 21 | ||
Projects under development | |||
Changes in the net carrying amount of property, plant and equipment | |||
Balance at the beginning of the year | 46.2 | ||
Balance at the end of the year | 91 | 46.2 | |
Projects under development | Cost | |||
Changes in the net carrying amount of property, plant and equipment | |||
Balance at the beginning of the year | 46.2 | 92.5 | |
Additions | 84 | 56 | |
Net change in additions financed with accounts payable | 13.3 | 1 | |
Reclassification | (46.7) | (104.5) | |
Retirement, disposals and other | (5.8) | 1.2 | |
Balance at the end of the year | $ 91 | $ 46.2 | $ 92.5 |
INTANGIBLE ASSETS - Changes in
INTANGIBLE ASSETS - Changes in the net carrying amount of intangible assets (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | $ 983.1 | $ 1,224 | |
Impairment losses | 13.8 | $ 0.8 | |
Balance at the end of the period | 1,135.3 | 983.1 | 1,224 |
Spectrum licence | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | 475.8 | ||
Balance at the end of the period | 475.8 | 475.8 | |
Software | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | 373.8 | ||
Balance at the end of the period | 427.8 | 373.8 | |
Customer relationships, naming rights and other | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | 59.2 | ||
Balance at the end of the period | 55.4 | 59.2 | |
Broadcasting licences, trademarks and sport franchises | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | 9.5 | ||
Balance at the end of the period | 9.5 | 9.5 | |
Projects under development | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | 64.8 | ||
Balance at the end of the period | 166.8 | 64.8 | |
Cost | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | 1,956.2 | 2,084.2 | |
Additions | 197.4 | 141.9 | |
Net change in additions financed with accounts payable | 64.6 | 26.2 | |
Reclassification to assets held for sale | (5.1) | ||
Retirement, disposals and other | (23.6) | (296.1) | |
Balance at the end of the period | 2,189.5 | 1,956.2 | 2,084.2 |
Cost | Spectrum licence | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | 723.5 | 1,006.9 | |
Retirement, disposals and other | (283.4) | ||
Balance at the end of the period | 723.5 | 723.5 | 1,006.9 |
Cost | Software | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | 927.1 | 811 | |
Additions | 100.9 | 77.7 | |
Net change in additions financed with accounts payable | (3.5) | 13.9 | |
Reclassification | 50.4 | 32.1 | |
Retirement, disposals and other | (7.2) | (7.6) | |
Balance at the end of the period | 1,067.7 | 927.1 | 811 |
Cost | Customer relationships, naming rights and other | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | 120.7 | 121.1 | |
Additions | 2.6 | 2.4 | |
Reclassification to assets held for sale | (5.1) | ||
Retirement, disposals and other | 1.2 | (2.8) | |
Balance at the end of the period | 119.4 | 120.7 | 121.1 |
Cost | Broadcasting licences, trademarks and sport franchises | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | 120.1 | 120.1 | |
Retirement, disposals and other | (8) | ||
Balance at the end of the period | 112.1 | 120.1 | 120.1 |
Cost | Projects under development | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | 64.8 | 25.1 | |
Additions | 93.9 | 61.8 | |
Net change in additions financed with accounts payable | 68.1 | 12.3 | |
Reclassification | (50.4) | (32.1) | |
Retirement, disposals and other | (9.6) | (2.3) | |
Balance at the end of the period | 166.8 | 64.8 | 25.1 |
Accumulated depreciation and impairment losses | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | (973.1) | (860.2) | |
Amortization | 105.5 | 103.8 | |
Reclassification to assets held for sale | 3.5 | ||
Impairment losses | 13.8 | ||
Retirement, disposals and other | 20.9 | 4.7 | |
Balance at the end of the period | (1,054.2) | (973.1) | (860.2) |
Accumulated depreciation and impairment losses | Spectrum licence | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | (247.7) | (247.7) | |
Balance at the end of the period | (247.7) | (247.7) | (247.7) |
Accumulated depreciation and impairment losses | Software | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | (553.3) | (461.8) | |
Amortization | 96.5 | 93 | |
Impairment losses | 1.4 | ||
Retirement, disposals and other | 9.9 | 2.9 | |
Balance at the end of the period | (639.9) | (553.3) | (461.8) |
Accumulated depreciation and impairment losses | Customer relationships, naming rights and other | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | (61.5) | (48.1) | |
Amortization | 9 | 10.8 | |
Reclassification to assets held for sale | 3.5 | ||
Impairment losses | 4.4 | ||
Retirement, disposals and other | 3 | 1.8 | |
Balance at the end of the period | (64) | (61.5) | (48.1) |
Accumulated depreciation and impairment losses | Broadcasting licences, trademarks and sport franchises | |||
Changes in the net carrying amount of intangible assets | |||
Balance at the beginning of the period | (110.6) | (102.6) | |
Impairment losses | 8 | ||
Retirement, disposals and other | 8 | ||
Balance at the end of the period | $ (102.6) | $ (110.6) | $ (102.6) |
INTANGIBLE ASSETS - Other infor
INTANGIBLE ASSETS - Other information (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
INTANGIBLE ASSETS | |||
Intangible assets other than goodwill, net | $ 1,135.3 | $ 983.1 | $ 1,224 |
Internally Generated | |||
INTANGIBLE ASSETS | |||
Intangible assets other than goodwill, net | 232.4 | 243.2 | |
Cost | |||
INTANGIBLE ASSETS | |||
Intangible assets other than goodwill, net | 2,189.5 | 1,956.2 | 2,084.2 |
Additions | 197.4 | 141.9 | |
Cost | Internally Generated | |||
INTANGIBLE ASSETS | |||
Intangible assets other than goodwill, net | 593 | 566.5 | |
Additions | 43.4 | 70.5 | 66 |
Accumulated depreciation and impairment losses | |||
INTANGIBLE ASSETS | |||
Intangible assets other than goodwill, net | (1,054.2) | (973.1) | (860.2) |
Amortization | 105.5 | 103.8 | |
Accumulated depreciation and impairment losses | Internally Generated | |||
INTANGIBLE ASSETS | |||
Intangible assets other than goodwill, net | (360.6) | (323.3) | |
Amortization | $ 40.7 | $ 44.9 | $ 43.8 |
GOODWILL - Changes in the net c
GOODWILL - Changes in the net carrying amount of goodwill (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Changes in the net carrying amount of goodwill | |||
Goodwill at beginning of year | $ 2,695.8 | $ 2,725.4 | |
Impairment losses | 30 | $ 40.1 | |
Goodwill at end of year | 2,678.3 | 2,695.8 | 2,725.4 |
Cost | |||
Changes in the net carrying amount of goodwill | |||
Goodwill at beginning of year | 5,688.6 | 5,688.2 | |
Business acquisitions | 2.1 | 0.4 | |
Reclassification to assets held for sale | (19.6) | ||
Goodwill at end of year | 5,671.1 | 5,688.6 | 5,688.2 |
Accumulated impairment losses | |||
Changes in the net carrying amount of goodwill | |||
Goodwill at beginning of year | (2,992.8) | (2,962.8) | |
Impairment losses | 30 | ||
Goodwill at end of year | $ (2,992.8) | $ (2,992.8) | $ (2,962.8) |
GOODWILL - Allocation of net ca
GOODWILL - Allocation of net carrying amount of goodwill in significant CGU groups (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
GOODWILL | |||
Goodwill | $ 2,678.3 | $ 2,695.8 | $ 2,725.4 |
Telecommunications | |||
GOODWILL | |||
Goodwill | 2,656.1 | 2,677 | |
Other | |||
GOODWILL | |||
Goodwill | $ 22.2 | $ 18.8 |
GOODWILL - Determination of rec
GOODWILL - Determination of recoverable amounts in the impairment tests performed in significant CGU groups (Details) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Minimum | ||
GOODWILL | ||
Duration of perpetual growth rate used for cash flows in strategic plan | 3 years | |
Telecommunications | ||
GOODWILL | ||
Pre-tax discount rate (WACC) | 9.00% | 8.50% |
Perpetual growth rate | 2.50% | 2.50% |
Magazines | ||
GOODWILL | ||
Pre-tax discount rate (WACC) | 15.50% | |
Perpetual growth rate | (2.00%) | |
Other | Minimum | ||
GOODWILL | ||
Pre-tax discount rate (WACC) | 11.50% | 12.00% |
Perpetual growth rate | 0.00% | 0.00% |
Other | Maximum | ||
GOODWILL | ||
Pre-tax discount rate (WACC) | 16.50% | 16.50% |
Perpetual growth rate | 2.00% | 2.00% |
LOANS TO THE PARENT CORPORATI_2
LOANS TO THE PARENT CORPORATION (Details) $ in Millions | Dec. 31, 2018CAD ($) | Sep. 28, 2018CAD ($) | Jul. 23, 2018CAD ($) | Jun. 29, 2018CAD ($) | Apr. 03, 2018CAD ($) |
LOANS TO THE PARENT CORPORATION | |||||
Loans to the parent corporation | $ 596.1 | ||||
Non-revolving unsubordinated and unsecured loan maturing in April 2021 | |||||
LOANS TO THE PARENT CORPORATION | |||||
Principal amount | $ 75 | ||||
Interest rate (as a percent) | 5.25 | ||||
Loans to the parent corporation | 75 | ||||
Non-revolving subordinated and unsecured loan maturing in April 2021 | |||||
LOANS TO THE PARENT CORPORATION | |||||
Principal amount | $ 75 | ||||
Interest rate (as a percent) | 5.50 | ||||
Loans to the parent corporation | 75 | ||||
Non-revolving subordinated and unsecured loan maturing in June 2021 | |||||
LOANS TO THE PARENT CORPORATION | |||||
Principal amount | $ 262 | ||||
Interest rate (as a percent) | 5.50 | ||||
Loans to the parent corporation | 262 | ||||
Non-revolving subordinated and unsecured loan maturing in July 2021 | |||||
LOANS TO THE PARENT CORPORATION | |||||
Principal amount | $ 87.1 | ||||
Interest rate (as a percent) | 5.50 | ||||
Loans to the parent corporation | 87.1 | ||||
Non-revolving subordinated and unsecured loan maturing in September 2021 | |||||
LOANS TO THE PARENT CORPORATION | |||||
Principal amount | $ 175 | ||||
Interest rate (as a percent) | 5.75 | ||||
Loans to the parent corporation | $ 97 |
OTHER ASSETS (Details)
OTHER ASSETS (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
OTHER ASSETS | |||
Contract assets | $ 204.9 | $ 183.6 | |
Assets recognised from costs to obtain or fulfil contracts with customers | 103 | 102.9 | |
Programs, broadcast and distribution rights | 120.3 | 121.4 | |
Other | 48.4 | 44.1 | |
Total other assets | 476.6 | 452 | |
Less current portion of contract assets | (144.4) | (132.8) | $ (106.6) |
Less current portion of contract costs (included in "Other current assets") | (53.4) | (55.9) | (49.4) |
Less current portion of program, broadcast and distribution rights (included in "Inventories") | (77.3) | (78.3) | |
Total other assets | 201.5 | 185 | 176.9 |
Impairment loss on contract assets | 25.8 | 16.1 | 12 |
Amortization on contract costs | $ 63.2 | $ 59.4 | $ 51 |
ACCOUNTS PAYABLE AND ACCRUED _3
ACCOUNTS PAYABLE AND ACCRUED CHARGES (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
ACCOUNTS PAYABLE AND ACCRUED CHARGES | |||
Trade and accruals | $ 612.7 | $ 512.2 | |
Salaries and employee benefits | 139 | 144 | |
Interest payable | 49.9 | 49.6 | |
Stock-based compensation | 18.9 | 19.8 | |
Total accounts payable and accrued charges | $ 820.5 | $ 725.6 | $ 691.6 |
PROVISIONS AND CONTINGENCIES -
PROVISIONS AND CONTINGENCIES - Roll forward (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2018CAD ($) | |
Reconciliation of changes in provisions | |
Balance at the beginning of the period | $ 44.7 |
Recognized in income | 18.4 |
Payments | (15.5) |
Other | 0.9 |
Balance at the end of the period | 48.5 |
Contingencies, legal disputes and other | |
Reconciliation of changes in provisions | |
Balance at the beginning of the period | 38.8 |
Recognized in income | 3.5 |
Payments | (1.7) |
Other | 0.9 |
Balance at the end of the period | 41.5 |
Restructuring of operations | |
Reconciliation of changes in provisions | |
Balance at the beginning of the period | 5.9 |
Recognized in income | 14.9 |
Payments | (13.8) |
Balance at the end of the period | $ 7 |
PROVISIONS AND CONTINGENCIES _2
PROVISIONS AND CONTINGENCIES - Current and non-current (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Total provisions | |||
Total other provisions | $ 48.5 | $ 44.7 | |
Current portion | 28.5 | 25.4 | $ 69.3 |
Non-current portion (included in "Other Liabilities") | 20 | ||
Contingencies, legal disputes and other | |||
Total provisions | |||
Total other provisions | 41.5 | 38.8 | |
Current portion | 23.7 | ||
Non-current portion (included in "Other Liabilities") | 17.8 | ||
Restructuring of operations | |||
Total provisions | |||
Total other provisions | 7 | $ 5.9 | |
Current portion | 4.8 | ||
Non-current portion (included in "Other Liabilities") | $ 2.2 |
LONG-TERM DEBT - Breakdown of l
LONG-TERM DEBT - Breakdown of long-term debt (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Long-term debt | |||
Total long-term debt | $ 6,408.2 | $ 5,346.7 | |
Change in fair value related to hedged interest rate risk | 2.5 | 5.8 | |
Financing fees, net of amortization | (35.7) | (40.8) | |
Total adjustments for long-term debt | (33.2) | (35) | |
Total long-term debt, current and non current | 6,375 | 5,311.7 | |
Less current portion | (56.6) | (19.1) | $ (20.9) |
Long-term debt | 6,318.4 | 5,292.6 | $ 5,617.2 |
Parent Company | |||
Long-term debt | |||
Total long-term debt | 2,110.9 | 1,988.9 | |
Long-term debt | $ 2,098.9 | 1,974.8 | |
Parent Company | Bank credit facilities | |||
Long-term debt | |||
Effective interest rate (as a percent) | 4.87% | ||
Total long-term debt | $ 451.7 | 420.4 | |
Parent Company | Senior Notes | |||
Long-term debt | |||
Total long-term debt | 1,659.2 | 1,568.5 | |
Subsidiaries | Videotron | |||
Long-term debt | |||
Total long-term debt | $ 4,244.4 | 3,294.6 | |
Subsidiaries | Videotron | Bank credit facilities | |||
Long-term debt | |||
Effective interest rate (as a percent) | 3.24% | ||
Total long-term debt | $ 742 | 5.4 | |
Subsidiaries | Videotron | Senior Notes | |||
Long-term debt | |||
Total long-term debt | $ 3,502.4 | 3,289.2 | |
Subsidiaries | TVA Group | Bank credit facilities | |||
Long-term debt | |||
Effective interest rate (as a percent) | 3.79% | ||
Total long-term debt | $ 52.9 | 62.9 | |
Subsidiaries | Other | |||
Long-term debt | |||
Total long-term debt | $ 0.3 |
LONG-TERM DEBT - Bank credit fa
LONG-TERM DEBT - Bank credit facilities (Details) $ in Millions, $ in Millions | 12 Months Ended | |||
Dec. 31, 2018USD ($) | Dec. 31, 2018CAD ($) | Dec. 31, 2017CAD ($) | Dec. 31, 2016CAD ($) | |
Long-term debt | ||||
Long-term debt | $ 6,408.2 | $ 5,346.7 | ||
Assets carrying value | 10,097.5 | 9,921 | $ 9,458.6 | |
Amount outstanding | 6,375 | 5,311.7 | ||
TVA Group | Secured revolving credit facility | ||||
Long-term debt | ||||
Amount outstanding | 0 | 0 | ||
TVA Group | Secured revolving credit facility maturing in February 2019 | ||||
Long-term debt | ||||
Principal amount | 150 | |||
TVA Group | Secured term loan maturing in November 2019 | ||||
Long-term debt | ||||
Long-term debt | 75 | |||
Amount outstanding | 52.9 | 62.9 | ||
Parent Company | ||||
Long-term debt | ||||
Long-term debt | 2,110.9 | 1,988.9 | ||
Assets carrying value | 4,568.9 | 3,230.1 | ||
Parent Company | Bank credit facilities | ||||
Long-term debt | ||||
Long-term debt | 451.7 | 420.4 | ||
Assets carrying value | $ 1,707 | 3,045.4 | ||
Parent Company | Secured term loan "B" facility maturing in August 2020 | ||||
Long-term debt | ||||
Long-term debt | $ 350 | |||
Interest rate basis | U.S London Interbank Offered Rate ("LIBOR") | |||
Adjustment to interest rate basis (as a percent) | 2.25% | 2.25% | ||
Quarterly amortization payments (as a percent) | 1.00% | 1.00% | ||
Parent Company | Secured revolving credit facility | ||||
Long-term debt | ||||
Amount outstanding | $ 0 | 0 | ||
Parent Company | Secured revolving credit facility maturing in July 2020 | ||||
Long-term debt | ||||
Principal amount | 300 | |||
Parent Company | Secured term loan "B" maturing in August 2020 | ||||
Long-term debt | ||||
Amount outstanding | 451.7 | 420.4 | ||
Subsidiaries | Videotron | ||||
Long-term debt | ||||
Long-term debt | 4,244.4 | 3,294.6 | ||
Subsidiaries | Videotron | Bank credit facilities | ||||
Long-term debt | ||||
Long-term debt | 742 | 5.4 | ||
Assets carrying value | 7,639.2 | 6,665.7 | ||
Subsidiaries | Videotron | Secured revolving credit facility | ||||
Long-term debt | ||||
Amount outstanding | 742 | 0 | ||
Subsidiaries | Videotron | Secured revolving credit facility maturing in July 2023 | ||||
Long-term debt | ||||
Principal amount | 1,500 | |||
Subsidiaries | Videotron | Secured revolving credit facility maturing in July 2021 | ||||
Long-term debt | ||||
Principal amount | 965 | |||
Subsidiaries | Videotron | Secured export financing facility maturing in June 2018 | ||||
Long-term debt | ||||
Amount outstanding | 5.4 | |||
Subsidiaries | TVA Group | Bank credit facilities | ||||
Long-term debt | ||||
Long-term debt | $ 52.9 | $ 62.9 |
LONG-TERM DEBT - Senior Notes (
LONG-TERM DEBT - Senior Notes (Details) $ in Millions, $ in Millions | 12 Months Ended | |||
Dec. 31, 2018CAD ($) | Dec. 31, 2017CAD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2018CAD ($) | |
Long-term debt | ||||
Senior notes redeemable period by issuer | 5 years | |||
Net proceeds from issuance of senior notes | $ 794.5 | |||
Parent Company | Senior Notes 5.750% due January 2023 | ||||
Long-term debt | ||||
Principal amount | $ 850 | |||
Interest rate (as a percent) | 5.75% | 5.75% | ||
Effective interest rate (after discount or premium at issuance) (as a percent) | 5.75% | 5.75% | ||
Parent Company | Senior Notes 6.625% due January 2023 | ||||
Long-term debt | ||||
Principal amount | $ 500 | |||
Interest rate (as a percent) | 6.625% | 6.625% | ||
Effective interest rate (after discount or premium at issuance) (as a percent) | 6.625% | 6.625% | ||
Subsidiaries | Videotron | Senior Notes 5.000% due July 2022 | ||||
Long-term debt | ||||
Principal amount | $ 800 | |||
Interest rate (as a percent) | 5.00% | 5.00% | ||
Effective interest rate (after discount or premium at issuance) (as a percent) | 5.00% | 5.00% | ||
Subsidiaries | Videotron | Senior Notes 5.375% due June 2024 | ||||
Long-term debt | ||||
Principal amount | $ 600 | |||
Interest rate (as a percent) | 5.375% | 5.375% | ||
Effective interest rate (after discount or premium at issuance) (as a percent) | 5.375% | 5.375% | ||
Subsidiaries | Videotron | Senior Notes 5.625% due June 2025 | ||||
Long-term debt | ||||
Principal amount | $ 400 | |||
Interest rate (as a percent) | 5.625% | 5.625% | ||
Effective interest rate (after discount or premium at issuance) (as a percent) | 5.625% | 5.625% | ||
Subsidiaries | Videotron | Senior Notes 5.750% due January 2026 | ||||
Long-term debt | ||||
Principal amount | $ 375 | |||
Interest rate (as a percent) | 5.75% | 5.75% | ||
Effective interest rate (after discount or premium at issuance) (as a percent) | 5.75% | 5.75% | ||
Subsidiaries | Videotron | Senior Notes 5.125% due April 2027 | ||||
Long-term debt | ||||
Principal amount | $ 600 | |||
Interest rate (as a percent) | 5.125% | 5.125% | ||
Effective interest rate (after discount or premium at issuance) (as a percent) | 5.125% | 5.125% | ||
Net proceeds from issuance of senior notes | $ 794.5 | |||
Financing fees | $ 9.9 |
LONG-TERM DEBT - Principal repa
LONG-TERM DEBT - Principal repayments of long-term debt (Details) $ in Millions | Dec. 31, 2018CAD ($) |
2019 | |
Principal repayments of long-term debt | |
Principal amount | $ 56.6 |
2020 | |
Principal repayments of long-term debt | |
Principal amount | 448.1 |
2022 | |
Principal repayments of long-term debt | |
Principal amount | 1,091 |
2023 | |
Principal repayments of long-term debt | |
Principal amount | 2,401.2 |
2024 and thereafter | |
Principal repayments of long-term debt | |
Principal amount | $ 2,411.3 |
OTHER LIABILITIES (Details)
OTHER LIABILITIES (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
OTHER LIABILITIES | |||
Defined benefit plans | $ 153.9 | $ 136.9 | |
Deferred revenues | 14.6 | 17.4 | |
Stock-based compensation | 12.2 | 8.3 | |
Other | 32.6 | 32.4 | |
Total other liabilities | 213.3 | 195 | $ 202.8 |
Stock-based compensation | $ 18.9 | $ 19.8 |
CAPITAL STOCK - Authorized capi
CAPITAL STOCK - Authorized capital stock (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Preferred A Shares | |
CAPITAL STOCK | |
Annual fixed cumulative preferential dividend (as a percent) | 12.50% |
Preferred C Shares | |
CAPITAL STOCK | |
Annual fixed cumulative preferential dividend (as a percent) | 11.25% |
Preferred D Shares | |
CAPITAL STOCK | |
Annual fixed cumulative preferential dividend (as a percent) | 11.00% |
Preferred F Shares | |
CAPITAL STOCK | |
Annual fixed cumulative preferential dividend (as a percent) | 10.85% |
Preferred G Shares | |
CAPITAL STOCK | |
Annual fixed cumulative preferential dividend (as a percent) | 10.85% |
CAPITAL STOCK - Issued and outs
CAPITAL STOCK - Issued and outstanding capital stock (Details) - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Issued and outstanding capital stock | ||
Balance at beginning of the year | $ 3,630.8 | $ 3,701.4 |
Reduction of paid-up capital | (50) | |
Redemption | (1,540) | (43.9) |
Balance at end of the year | 3,019.7 | 3,630.8 |
Aggregate purchase price of shares repurchased | 1,540 | 43.9 |
Capital stock | ||
Issued and outstanding capital stock | ||
Balance at beginning of the year | $ 3,630.8 | $ 3,701.4 |
Balance at beginning of the year (in shares) | 95,441,277 | 95,983,176 |
Reduction of paid-up capital | $ (50) | |
Redemption | $ (611.1) | $ (20.6) |
Redemption (in shares) | (16,064,215) | (541,899) |
Balance at end of the year | $ 3,019.7 | $ 3,630.8 |
Balance at end of the year (in shares) | 79,377,062 | 95,441,277 |
Capital stock | CDP Capital | ||
Issued and outstanding capital stock | ||
Redemption (in shares) | (16,064,215) | (541,899) |
Aggregate purchase price of shares repurchased | $ 1,540 | $ 37.7 |
Security paid | 6.2 | |
Excess of purchase price over common shares repurchased | $ 928.9 | $ 23.3 |
STOCK-BASED COMPENSATION PLAN_2
STOCK-BASED COMPENSATION PLANS - Quebecor stock option plan (Details) - Quebecor Stock option plan | 12 Months Ended |
Dec. 31, 2018shares | |
STOCK-BASED COMPENSATION PLANS | |
Exercisable period | 10 years |
One year | |
STOCK-BASED COMPENSATION PLANS | |
Percentage of stock options vested | 33.33% |
Vesting period of share based awards (in years) | 1 year |
Two years | |
STOCK-BASED COMPENSATION PLANS | |
Percentage of stock options vested | 66.67% |
Vesting period of share based awards (in years) | 2 years |
Three years | |
STOCK-BASED COMPENSATION PLANS | |
Percentage of stock options vested | 100.00% |
Vesting period of share based awards (in years) | 3 years |
Class B | |
STOCK-BASED COMPENSATION PLANS | |
Number of shares authorized to issue under stock-based compensation plans | 26,000,000 |
STOCK-BASED COMPENSATION PLAN_3
STOCK-BASED COMPENSATION PLANS - Quebecor outstanding and exercise price range of options (Details) - Quebecor Stock option plan | 12 Months Ended | |
Dec. 31, 2018CAD ($)Option | Dec. 31, 2017CAD ($)Option | |
STOCK-BASED COMPENSATION PLANS | ||
Balance at beginning of year | Option | 440,000 | 1,360,000 |
Granted | Option | 1,242,892 | |
Exercised | Option | (100,000) | (630,000) |
Cancelled | Option | (20,000) | (290,000) |
Balance at end of year | Option | 1,562,892 | 440,000 |
Vested options at end of year | Option | 340,000 | 376,666 |
Balance at beginning of year | $ 12.31 | $ 12.69 |
Granted | 26.52 | |
Exercised | 12.75 | 12.82 |
Cancelled | 26.52 | 12.97 |
Balance at end of year | 23.40 | 12.31 |
Vested options at end of year | 12.17 | 12.04 |
Cash consideration on stock options exercised | $ 1,200,000 | $ 4,700,000 |
STOCK-BASED COMPENSATION PLAN_4
STOCK-BASED COMPENSATION PLANS - Quebecor stock option plan price range of options (Details) - Quebecor Stock option plan | Dec. 31, 2018CAD ($)OptionY | Dec. 31, 2017CAD ($)Option | Dec. 31, 2016CAD ($)Option |
Range of exercise price | |||
Number of shares outstanding | Option | 1,562,892 | 440,000 | 1,360,000 |
Weighted average years to maturity | Y | 7.28 | ||
Weighted average exercise price of outstanding options | $ 23.40 | $ 12.31 | $ 12.69 |
Number of vested options | Option | 340,000 | 376,666 | |
Weighted average exercise price of vested options | $ 12.17 | $ 12.04 | |
Minimum | |||
Range of exercise price | |||
Exercise price of outstanding options | 11.11 | ||
Maximum | |||
Range of exercise price | |||
Exercise price of outstanding options | $ 26.52 | ||
$11.11 to 15.12 | |||
Range of exercise price | |||
Number of shares outstanding | Option | 340,000 | ||
Weighted average years to maturity | Y | 4.78 | ||
Weighted average exercise price of outstanding options | $ 12.17 | ||
Number of vested options | Option | 340,000 | ||
Weighted average exercise price of vested options | $ 12.17 | ||
$11.11 to 15.12 | Minimum | |||
Range of exercise price | |||
Exercise price of outstanding options | 11.11 | ||
$11.11 to 15.12 | Maximum | |||
Range of exercise price | |||
Exercise price of outstanding options | 15.12 | ||
$26.52 | |||
Range of exercise price | |||
Exercise price of outstanding options | $ 26.52 | ||
Number of shares outstanding | Option | 1,222,892 | ||
Weighted average years to maturity | Y | 9.78 | ||
Weighted average exercise price of outstanding options | $ 26.52 |
STOCK-BASED COMPENSATION PLAN_5
STOCK-BASED COMPENSATION PLANS - Quebecor mid-term stock-based plan (Details) - Quebecor Mid-term stock-based compensation plan $ in Millions | 12 Months Ended | |
Dec. 31, 2018CAD ($)EquityInstruments | Dec. 31, 2017CAD ($)EquityInstruments | |
STOCK-BASED COMPENSATION PLANS | ||
Exercised (in shares) | EquityInstruments | 93,610 | 1,140,941 |
Cash consideration on stock options exercised | $ | $ 0.8 | $ 4.9 |
STOCK-BASED COMPENSATION PLAN_6
STOCK-BASED COMPENSATION PLANS - Quebecor deferred share unit plan (Details) - Quebecor Deferred Share Unit Plan - EquityInstruments | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
STOCK-BASED COMPENSATION PLANS | ||
Number of units outstanding | 108,885 | 89,397 |
Minimum | ||
STOCK-BASED COMPENSATION PLANS | ||
Percent of total annual fee payable to director for receive of share based compensation | 50.00% | |
Maximum | ||
STOCK-BASED COMPENSATION PLANS | ||
Percent of total annual fee payable to director for receive of share based compensation | 100.00% |
STOCK-BASED COMPENSATION PLAN_7
STOCK-BASED COMPENSATION PLANS - Quebecor Media stock option plan (Details) - Quebecor Media stock option plan | 12 Months Ended |
Dec. 31, 2018shares | |
STOCK-BASED COMPENSATION PLANS | |
Number of shares authorized to issue under stock-based compensation plans | 6,180,140 |
Vesting period of share based awards (in years) | 5 years |
Maximum | |
STOCK-BASED COMPENSATION PLANS | |
Term of an option | 10 years |
Stock option plan - first anniversary | |
STOCK-BASED COMPENSATION PLANS | |
Vesting period of share based awards (in years) | 5 years |
Annual vesting percent of share based awards | 20.00% |
Stock option plan - second anniversary | |
STOCK-BASED COMPENSATION PLANS | |
Vesting period of share based awards (in years) | 4 years |
Annual vesting percent of share based awards | 25.00% |
Stock option plan - third anniversary | |
STOCK-BASED COMPENSATION PLANS | |
Vesting period of share based awards (in years) | 3 years |
Annual vesting percent of share based awards | 33.33% |
STOCK-BASED COMPENSATION PLAN_8
STOCK-BASED COMPENSATION PLANS - Quebecor Media outstanding options (Details) - Quebecor Media stock option plan | 12 Months Ended | |
Dec. 31, 2018CAD ($)Option | Dec. 31, 2017CAD ($)Option | |
STOCK-BASED COMPENSATION PLANS | ||
Balance at beginning of year | Option | 595,827 | 980,905 |
Exercised | Option | (263,227) | (215,978) |
Cancelled | Option | (14,200) | (169,100) |
Balance at end of year | Option | 318,400 | 595,827 |
Vested options at end of year | Option | 170,500 | 226,200 |
Balance at beginning of year | $ 62.84 | $ 61.71 |
Exercised | 60.31 | 59.40 |
Cancelled | 70.06 | 60.65 |
Balance at end of year | 64.61 | 62.84 |
Vested options at end of year | 61.07 | 58.78 |
Cash consideration on stock options exercised | $ 10,700,000 | $ 5,500,000 |
STOCK-BASED COMPENSATION PLAN_9
STOCK-BASED COMPENSATION PLANS - Quebecor Media exercise price range of options (Details) - Quebecor Media stock option plan | Dec. 31, 2018CAD ($)OptionY | Dec. 31, 2017CAD ($)Option | Dec. 31, 2016CAD ($)Option |
Range of exercise price | |||
Number of shares outstanding | Option | 318,400 | 595,827 | 980,905 |
Weighted average years to maturity | Y | 5.43 | ||
Weighted average exercise price of outstanding options | $ 64.61 | $ 62.84 | $ 61.71 |
Number of vested options | Option | 170,500 | 226,200 | |
Weighted average exercise price of vested options | $ 61.07 | $ 58.78 | |
Minimum | |||
Range of exercise price | |||
Exercise price of outstanding options | 50.10 | ||
Maximum | |||
Range of exercise price | |||
Exercise price of outstanding options | $ 70.56 | ||
$50.10 to 57.64 | |||
Range of exercise price | |||
Number of shares outstanding | Option | 103,350 | ||
Weighted average years to maturity | Y | 5.70 | ||
Weighted average exercise price of outstanding options | $ 56.05 | ||
Number of vested options | Option | 40,500 | ||
Weighted average exercise price of vested options | $ 55.33 | ||
$50.10 to 57.64 | Minimum | |||
Range of exercise price | |||
Exercise price of outstanding options | 50.10 | ||
$50.10 to 57.64 | Maximum | |||
Range of exercise price | |||
Exercise price of outstanding options | $ 57.64 | ||
$63.50 to 70.56 | |||
Range of exercise price | |||
Number of shares outstanding | Option | 215,050 | ||
Weighted average years to maturity | Y | 5.30 | ||
Weighted average exercise price of outstanding options | $ 67.88 | ||
Number of vested options | Option | 130,000 | ||
Weighted average exercise price of vested options | $ 68.29 | ||
$63.50 to 70.56 | Minimum | |||
Range of exercise price | |||
Exercise price of outstanding options | 63.50 | ||
$63.50 to 70.56 | Maximum | |||
Range of exercise price | |||
Exercise price of outstanding options | $ 70.56 |
STOCK-BASED COMPENSATION PLA_10
STOCK-BASED COMPENSATION PLANS - TVA Group stock option plan (Details) - TVA Group stock option plan | 12 Months Ended |
Dec. 31, 2018shares | |
Stock option plan - first anniversary | |
STOCK-BASED COMPENSATION PLANS | |
Vesting period of share based awards (in years) | 5 years |
Annual vesting percent of share based awards | 20.00% |
Stock option plan - second anniversary | |
STOCK-BASED COMPENSATION PLANS | |
Vesting period of share based awards (in years) | 4 years |
Annual vesting percent of share based awards | 25.00% |
Stock option plan - third anniversary | |
STOCK-BASED COMPENSATION PLANS | |
Vesting period of share based awards (in years) | 3 years |
Annual vesting percent of share based awards | 33.33% |
Maximum | |
STOCK-BASED COMPENSATION PLANS | |
Term of an option | 10 years |
Class B | |
STOCK-BASED COMPENSATION PLANS | |
Number of shares authorized to issue under stock-based compensation plans | 2,200,000 |
STOCK-BASED COMPENSATION PLA_11
STOCK-BASED COMPENSATION PLANS - TVA Group outstanding options (Details) - TVA Group stock option plan | 12 Months Ended | |
Dec. 31, 2018CAD ($)OptionY | Dec. 31, 2017CAD ($)Option | |
STOCK-BASED COMPENSATION PLANS | ||
Balance at beginning of year | Option | 60,000 | 357,632 |
Granted (in shares) | Option | 280,000 | |
Cancelled | Option | (134,915) | |
Expired (in shares) | Option | (162,717) | |
Balance at end of year | Option | 340,000 | 60,000 |
Vested options at end of year | Option | 36,000 | 24,000 |
Balance at beginning of year | $ 6.85 | $ 12.71 |
Granted (in dollars per share) | 2.16 | |
Cancelled | 12.86 | |
Expired (in dollars per share) | 14.75 | |
Balance at end of year | 2.99 | 6.85 |
Vested options at end of year | $ 6.85 | $ 6.85 |
Weighted average years to maturity | Y | 9.10 | |
Minimum | ||
STOCK-BASED COMPENSATION PLANS | ||
Exercise price of outstanding options | $ 2.16 | |
Maximum | ||
STOCK-BASED COMPENSATION PLANS | ||
Exercise price of outstanding options | $ 6.85 |
STOCK-BASED COMPENSATION PLA_12
STOCK-BASED COMPENSATION PLANS - Deferred share unit and performance share unit plans (Details) - EquityInstruments | Jul. 13, 2016 | Jul. 10, 2016 | Dec. 31, 2018 |
Quebecor deferred share unit plan, employees | |||
STOCK-BASED COMPENSATION PLANS | |||
Vesting life of share based awards | 6 years | ||
Number of units outstanding | 143,860 | ||
Quebecor performance shares, employees | |||
STOCK-BASED COMPENSATION PLANS | |||
Vesting life of share based awards | 3 years | ||
Number of units outstanding | 215,336 | ||
TVA group deferred share unit plan, employees | |||
STOCK-BASED COMPENSATION PLANS | |||
Vesting life of share based awards | 6 years | ||
Number of units outstanding | 244,140 | ||
TVA group performance shares, employees | |||
STOCK-BASED COMPENSATION PLANS | |||
Vesting life of share based awards | 3 years | ||
Number of units outstanding | 270,637 |
STOCK-BASED COMPENSATION PLA_13
STOCK-BASED COMPENSATION PLANS - Assumptions in estimating the fair value of awards (Details) - Y | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Quebecor Stock option plan | ||
STOCK-BASED COMPENSATION PLANS | ||
Risk-free interest rate | 2.05% | 1.83% |
Distribution yield | 0.77% | 0.46% |
Expected volatility (as a percent) | 17.93% | 17.58% |
Expected remaining life | 4.8 | 2.4 |
Quebecor Media stock option plan | ||
STOCK-BASED COMPENSATION PLANS | ||
Risk-free interest rate | 1.97% | 1.80% |
Distribution yield | 1.13% | 1.12% |
Expected volatility (as a percent) | 16.11% | 16.70% |
Expected remaining life | 1.5 | 2.3 |
TVA Group stock option plan | ||
STOCK-BASED COMPENSATION PLANS | ||
Risk-free interest rate | 2.06% | 1.97% |
Expected volatility (as a percent) | 47.07% | 50.78% |
Expected remaining life | 5.2 | 3.6 |
STOCK-BASED COMPENSATION PLA_14
STOCK-BASED COMPENSATION PLANS - Liability and expense (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
STOCK-BASED COMPENSATION PLANS | |||
Liability for all vested options under intrinsic value | $ 14.2 | $ 12.2 | |
Consolidated charge related to stock-based compensation | $ 15.6 | $ 15.4 | $ 16.3 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE LOSS (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | |||
Equity at beginning of period | $ 2,545 | $ 1,858.5 | |
Other comprehensive income (loss) | (20.7) | 69.4 | $ 9.2 |
Equity at end of period | 1,424.7 | 2,545 | 1,858.5 |
Accumulated other comprehensive loss | |||
ACCUMULATED OTHER COMPREHENSIVE LOSS | |||
Equity at beginning of period | (60.4) | (129.5) | (136) |
Other comprehensive income (loss) | (20.9) | 69.1 | 6.5 |
Equity at end of period | (81.3) | (60.4) | (129.5) |
Cash flow hedges | |||
ACCUMULATED OTHER COMPREHENSIVE LOSS | |||
Equity at beginning of period | (14.5) | (86.2) | (71.1) |
Other comprehensive income (loss) | (15.8) | 71.7 | (15.1) |
Equity at end of period | $ (30.3) | (14.5) | (86.2) |
Expected reversal period | 8 years 3 months | ||
Defined benefit plans | |||
ACCUMULATED OTHER COMPREHENSIVE LOSS | |||
Equity at beginning of period | $ (45.9) | (43.3) | (64.9) |
Other comprehensive income (loss) | (5.1) | (2.6) | 21.6 |
Equity at end of period | $ (51) | $ (45.9) | $ (43.3) |
COMMITMENTS (Details)
COMMITMENTS (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
COMMITMENTS | |||
Minimum future rent payments to the parent | $ 48.1 | ||
Operating lease expenses | 66.6 | $ 68.1 | $ 67.1 |
2019 | Leases | |||
COMMITMENTS | |||
Minimum payments | 49.5 | ||
2019 | Other commitments | |||
COMMITMENTS | |||
Minimum payments | 247.4 | ||
2020 to 2023 | Leases | |||
COMMITMENTS | |||
Minimum payments | 94.8 | ||
2020 to 2023 | Other commitments | |||
COMMITMENTS | |||
Minimum payments | 648.4 | ||
2024 and thereafter | Leases | |||
COMMITMENTS | |||
Minimum payments | 96.7 | ||
2024 and thereafter | Other commitments | |||
COMMITMENTS | |||
Minimum payments | $ 455.7 |
GUARANTEES (Details)
GUARANTEES (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
GUARANTEES | |||
Maximum exposure with respect to operating lease guarantees | $ 19.3 | ||
Guarantees |
FINANCIAL INSTRUMENTS AND FIN_3
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Description of derivative financial instruments (Details) - 12 months ended Dec. 31, 2018 $ in Millions, $ in Millions | CAD ($)$ / $ | USD ($) |
Videotron | Foreign exchange forward contracts | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Average exchange rate | $ / $ | 1.3056 | |
Notional amount sold | $ 165.6 | |
Notional amount | $ 126.8 | |
5.750% Senior Notes due 2023 | Cross-currency interest rate swaps | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Average exchange rate | $ / $ | 0.9792 | |
Notional amount | $ 431.3 | |
Effective interest rate (as a percent) | 5.75% | |
Annual interest rate on notional amount (as a percent) | 7.27% | |
5.750% Senior Notes due 2023 | Cross-currency interest rate swaps | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Average exchange rate | $ / $ | 0.9759 | |
Notional amount | $ 418.7 | |
Effective interest rate (as a percent) | 5.75% | |
Annual interest rate on notional amount (as a percent) | 6.85% | |
5.000% Senior Notes due 2022 | Videotron | Cross-currency interest rate swaps | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Average exchange rate | $ / $ | 0.9983 | |
Notional amount | $ 543.1 | |
Effective interest rate (as a percent) | 5.00% | |
Annual interest rate on notional amount (as a percent) | 6.01% | |
5.000% Senior Notes due 2022 | Videotron | Cross-currency interest rate swaps | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Average exchange rate | $ / $ | 1.0016 | |
Notional amount | $ 256.9 | |
Effective interest rate (as a percent) | 5.00% | |
Annual interest rate on notional amount (as a percent) | 5.81% | |
5.375% Senior Notes due 2024 | Videotron | Cross-currency interest rate swaps | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Average exchange rate | $ / $ | 1.1034 | |
Notional amount | $ 158.6 | |
Effective interest rate (as a percent) | 5.375% | |
Annual interest rate on notional amount, interest rate basis | Bankers' acceptance 3 months | |
Annual interest rate on notional amount, adjustment to interest rate basis (as a percent) | 2.67% | |
5.375% Senior Notes due 2024 | Videotron | Cross-currency interest rate swaps | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Average exchange rate | $ / $ | 1.1039 | |
Notional amount | $ 441.4 | |
Effective interest rate (as a percent) | 5.375% | |
Annual interest rate on notional amount (as a percent) | 5.62% | |
5.125% Senior Notes due 2024 | Videotron | Cross-currency interest rate swaps | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Average exchange rate | $ / $ | 1.3407 | |
Notional amount | $ 600 | |
Effective interest rate (as a percent) | 5.125% | |
Annual interest rate on notional amount (as a percent) | 4.82% | |
Term loan "B" | Cross-currency interest rate swaps | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Average exchange rate | $ / $ | 1.0346 | |
Notional amount | $ 331.6 | |
Annual interest rate on notional amount, interest rate basis | Bankers' acceptance 3 months | |
Annual interest rate on notional amount, adjustment to interest rate basis (as a percent) | 2.77% | |
Revolver facility | Videotron | Cross-currency interest rate swaps | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Average exchange rate | $ / $ | 1.3417 | |
Notional amount | $ 160 | |
Annual interest rate on notional amount, interest rate basis | Bankers' acceptance 1 month | |
Annual interest rate on notional amount, adjustment to interest rate basis (as a percent) | 0.42% |
FINANCIAL INSTRUMENTS AND FIN_4
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Carrying value and fair value of financial assets (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Carrying value | Foreign exchange forward contracts | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Asset | $ 6.7 | |
Carrying value | Cross-currency interest rate swaps | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Asset | 880.3 | $ 562.2 |
Fair value | Foreign exchange forward contracts | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Asset | 6.7 | |
Fair value | Cross-currency interest rate swaps | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Asset | $ 880.3 | $ 562.2 |
FINANCIAL INSTRUMENTS AND FIN_5
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Carrying value and fair value of financial liabilities (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Carrying value | Long-term debt | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Liability | $ (6,408.2) | $ (5,346.7) |
Carrying value | Foreign exchange forward contracts | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Liability | (4.5) | |
Fair value | Long-term debt | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Liability | $ (6,391.5) | (5,658) |
Fair value | Foreign exchange forward contracts | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Liability | $ (4.5) |
FINANCIAL INSTRUMENTS AND FIN_6
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Fair value of derivative financial instruments designated as hedges (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Hedge items | ||
Fair value of derivative financial instruments designated as hedges, asset position | $ 887 | $ 557.7 |
Cash flow hedges | ||
Hedge items | ||
Fair value of derivative financial instruments designated as hedges, asset position | 840.6 | 525.7 |
Fair value hedges | ||
Hedge items | ||
Fair value of derivative financial instruments designated as hedges, asset position | $ 46.4 | $ 32 |
FINANCIAL INSTRUMENTS AND FIN_7
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Credit risk management (Details) - 90 days past due - Credit risk management | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Trade receivables past due (as a percent) | 2.70% | 2.90% |
Trade receivables past due which had an established allowance for doubtful accounts (as a percent) | 11.70% | 11.30% |
FINANCIAL INSTRUMENTS AND FIN_8
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Allowance for doubtful accounts (Details) - Trade receivables - Accumulated impairment losses - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Balance at beginning of year | $ 21.1 | $ 28.1 |
Changes in expected credit losses charged to income | 19.6 | 21.6 |
Write-off | (20.2) | (28.6) |
Balance at end of year | $ 20.5 | $ 21.1 |
FINANCIAL INSTRUMENTS AND FIN_9
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Liquidity risk management (Details) - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Bank indebtedness | $ 24.3 | |
Accounts payable and accrued charges | 820.5 | |
Long-term debt | 6,408.2 | |
Interest payments | 1,500.6 | |
Derivative financial instruments | (892.7) | |
Total | $ 7,860.9 | |
Liquidity risk management | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Weighted average term of the Corporation's consolidated debt | 5 years 1 month 6 days | 6 years 1 month 6 days |
2019 | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Bank indebtedness | $ 24.3 | |
Accounts payable and accrued charges | 820.5 | |
Long-term debt | 56.6 | |
Interest payments | 252.3 | |
Derivative financial instruments | 0.2 | |
Total | 1,153.9 | |
1-3 years | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Long-term debt | 448.1 | |
Interest payments | 578.2 | |
Derivative financial instruments | (105.1) | |
Total | 921.2 | |
3-5 years | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Long-term debt | 3,492.2 | |
Interest payments | 428.4 | |
Derivative financial instruments | (618.1) | |
Total | 3,302.5 | |
2024 and thereafter | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Long-term debt | 2,411.3 | |
Interest payments | 241.7 | |
Derivative financial instruments | (169.7) | |
Total | $ 2,483.3 |
FINANCIAL INSTRUMENTS AND FI_10
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Market risk (Details) - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Increase of $0.10 | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Income | $ 1.3 | |
Other comprehensive income | 34.8 | |
Decrease of $0.10 | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Income | (1.3) | |
Other comprehensive income | (34.8) | |
Variance of $0.10 in the foreign currency exchange rate | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Unhedged purchase of goods and services | 2.4 | |
Unhedged acquisitions of tangible and intangible assets | $ 4.4 | |
Interest rate risk | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Long-term debt, fixed-rate debt (in percent) | 76.20% | 87.70% |
Long-term debt, floating-rate debt (in percent) | 23.80% | 12.30% |
Estimated sensitivity on interest payments | $ 13.1 | |
Increase of 100 basis points in discount rate | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Income | (1.9) | |
Other comprehensive income | (28.1) | |
Decrease of 100 basis points in discount rate | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Income | 1.9 | |
Other comprehensive income | $ 28.1 |
FINANCIAL INSTRUMENTS AND FI_11
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Capital management (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||||
Bank indebtedness | $ 24.3 | $ 18.9 | ||
Long-term debt | 6,375 | $ 5,311.7 | ||
Derivative financial instruments | (887) | (557.7) | ||
Cash and cash equivalents | (21) | (864.9) | (20.7) | $ (18.6) |
Loans to the parent corporation | (596.1) | |||
Net liabilities | 4,895.2 | 3,889.1 | ||
Equity | $ 1,424.7 | $ 2,545 | $ 1,858.5 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
RELATED PARTY TRANSACTIONS | |||
Salaries and short-term benefits | $ 9.9 | $ 9.1 | $ 9.3 |
Share-based compensation | 5.4 | 5.9 | 9.3 |
Other long-term benefits | 1.2 | 8.5 | 1.3 |
Total compensation | 16.5 | 23.5 | 19.9 |
Purchases and rent charges included in purchase of goods and services | 10 | 9.2 | 9 |
Sales to an affiliated corporation | 2.8 | 2.8 | 3 |
Amount received included as reduction in employee costs | 2.4 | 2.2 | 2.2 |
Management fees | 2.5 | 2.7 | 2.6 |
Non-capital losses | 54.2 | 0 | 22.1 |
Cash consideration | $ 13.9 | $ 0 | $ 5.6 |
PENSION PLANS AND POSTRETIREM_3
PENSION PLANS AND POSTRETIREMENT BENEFITS - Indexation features (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Minimum | |
PENSION PLANS AND POSTRETIREMENT BENEFITS | |
Indexation features (as a percent) | 0.00% |
Maximum | |
PENSION PLANS AND POSTRETIREMENT BENEFITS | |
Indexation features (as a percent) | 2.00% |
PENSION PLANS AND POSTRETIREM_4
PENSION PLANS AND POSTRETIREMENT BENEFITS - Changes in the plans benefit obligations (Details) - Present value of defined benefit - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Pension defined benefit plans | ||
Disclosure of net defined benefit liability (asset) | ||
Benefit obligations at the beginning of the year | $ 1,320.4 | $ 1,274.9 |
Service costs | 36.4 | 33.9 |
Interest costs | 46 | 49.8 |
Plan participants' contributions | 11.1 | 11.5 |
Actuarial (gain) loss arising from: | ||
Financial assumptions | (75.7) | 82.1 |
Demographic assumptions | (8.6) | |
Participant experience | (1.1) | 4.5 |
Benefits and settlements paid | (55.1) | (72.7) |
Plan transfer | (55.4) | |
Other | 1.2 | 0.4 |
Benefit obligations at the end of the year | 1,283.2 | 1,320.4 |
Postretirement defined benefit plans | ||
Disclosure of net defined benefit liability (asset) | ||
Benefit obligations at the beginning of the year | 60.5 | 73.4 |
Service costs | 2.1 | 1.9 |
Interest costs | 2.8 | 2.9 |
Actuarial (gain) loss arising from: | ||
Financial assumptions | 20.5 | 5.4 |
Demographic assumptions | (12.3) | |
Participant experience | (0.5) | (21.2) |
Benefits and settlements paid | (1.7) | (1.9) |
Benefit obligations at the end of the year | $ 71.4 | $ 60.5 |
PENSION PLANS AND POSTRETIREM_5
PENSION PLANS AND POSTRETIREMENT BENEFITS - Changes in the fair value of plan assets (Details) - Plan assets - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Disclosure of net defined benefit liability (asset) | ||
Employer contributions | $ 35.7 | |
Pension defined benefit plans | ||
Disclosure of net defined benefit liability (asset) | ||
Fair value of plan assets at the beginning of the year | 1,267.3 | $ 1,244.4 |
Actual return on plan assets | (37.5) | 106.5 |
Employer contributions | 34 | 35.5 |
Plan participants' contributions | 11.1 | 11.5 |
Administrative fees | (2.5) | (2.5) |
Benefits and settlements paid | (55.1) | (72.7) |
Plan transfer | (55.4) | |
Fair value of plan assets at the end of the year | 1,217.3 | 1,267.3 |
Postretirement defined benefit plans | ||
Disclosure of net defined benefit liability (asset) | ||
Employer contributions | 1.7 | 1.9 |
Benefits and settlements paid | $ (1.7) | $ (1.9) |
PENSION PLANS AND POSTRETIREM_6
PENSION PLANS AND POSTRETIREMENT BENEFITS - Components of plan assets and reconciliation of funded status (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2018CAD ($)Y | Dec. 31, 2017CAD ($)Y | |
Disclosure of net defined benefit liability (asset) | ||
Weighted average duration of defined benefit obligations | Y | 15.6 | 16.5 |
Expected future benefit payments in 2019 | $ 64 | |
Reconciliation of funded status to net amount recognized | ||
Recognized assets, defined benefit plan | $ 2.9 | |
Recognized liabilities, defined benefit plans | 153.9 | 136.9 |
Pension defined benefit plans | ||
Reconciliation of funded status to net amount recognized | ||
Benefit obligations | (1,283.2) | (1,320.4) |
Fair value of plan assets | 1,217.3 | 1,267.3 |
Plan deficit | (65.9) | (53.1) |
Asset limit and minimum funding adjustment | (16) | (20.4) |
Net amount recognized | (81.9) | (73.5) |
Postretirement defined benefit plans | ||
Reconciliation of funded status to net amount recognized | ||
Benefit obligations | (71.4) | (60.5) |
Plan deficit | (71.4) | (60.5) |
Net amount recognized | $ (71.4) | $ (60.5) |
Plan assets | ||
Plan assets | ||
Debt securities (as a percent) | 46.60% | 40.80% |
Other (as a percent) | 1.10% | 3.30% |
Total plan assets (in percent) | 100.00% | 100.00% |
Plan assets | Canadian | ||
Plan assets | ||
Equity securities (as a percent) | 21.10% | 23.60% |
Plan assets | Foreign | ||
Plan assets | ||
Equity securities (as a percent) | 31.20% | 32.30% |
PENSION PLANS AND POSTRETIREM_7
PENSION PLANS AND POSTRETIREMENT BENEFITS - Components of re-measurements (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Pension defined benefit plans | |||
Disclosure of net defined benefit liability (asset) | |||
Actuarial gain (loss) on benefit obligations | $ 76.8 | $ (78) | $ (20.1) |
Actual return on plan assets, less interest income anticipated in the interest on the net defined benefit liability calculation | (80.9) | 59.1 | 51.8 |
Asset limit and minimum funding adjustment | 5 | (0.1) | 2.8 |
Re-measurements gain (loss) recorded in other comprehensive income | 0.9 | (19) | 34.5 |
Postretirement defined benefit plans | |||
Disclosure of net defined benefit liability (asset) | |||
Actuarial gain (loss) on benefit obligations | (7.7) | 15.8 | (1.4) |
Re-measurements gain (loss) recorded in other comprehensive income | $ (7.7) | $ 15.8 | $ (1.4) |
PENSION PLANS AND POSTRETIREM_8
PENSION PLANS AND POSTRETIREMENT BENEFITS - Components of the net benefit costs (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Pension defined benefit plans | |||
Employee costs: | |||
Service costs | $ 36.4 | $ 33.9 | $ 34.9 |
Administrative fees and other | 3.7 | 3 | 3 |
Interest on net defined benefit liability | 3.4 | 2.9 | 3.9 |
Net benefit costs | 43.5 | 39.8 | 41.8 |
Postretirement defined benefit plans | |||
Employee costs: | |||
Service costs | 2.1 | 1.9 | 1.8 |
Interest on net defined benefit liability | 2.8 | 2.9 | 2.8 |
Net benefit costs | $ 4.9 | $ 4.8 | $ 4.6 |
PENSION PLANS AND POSTRETIREM_9
PENSION PLANS AND POSTRETIREMENT BENEFITS - Defined contribution plans (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
PENSION PLANS AND POSTRETIREMENT BENEFITS | |||
Defined contribution expense | $ 19.8 | $ 17.6 | $ 16.8 |
PENSION PLANS AND POSTRETIRE_10
PENSION PLANS AND POSTRETIREMENT BENEFITS - Assumptions and sensitivity analysis (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018CAD ($)Y | Dec. 31, 2017CAD ($)Y | Dec. 31, 2016Y | |
Disclosure of net defined benefit liability (asset) | |||
Expected employer contributions in 2019 | $ 32.6 | ||
Benefit obligations | |||
Percentage increase of discount rate (as a percent) | 0.10% | ||
Actuarial assumption discount rate | |||
Current periodic costs | |||
Assumed average retirement age | Y | 62 | 62 | 62 |
Assumed health care cost trend rate (as a percent) | 7.90% | ||
Assumed health care cost trend rate after ten years (as a percent) | 5.10% | ||
Plan assets | |||
Disclosure of net defined benefit liability (asset) | |||
Employer contributions | $ 35.7 | ||
Pension defined benefit plans | |||
Benefit obligations | |||
Decrease of retirement benefit obligation due to increase of actuarial assumption of 10 basis points in discount rate | $ 17.4 | ||
Pension defined benefit plans | Actuarial assumption discount rate | |||
Benefit obligations | |||
Discount rate, current year (as a percent) | 3.90% | 3.50% | 3.90% |
Rate of compensation increase, current year (as a percent) | 3.00% | 3.00% | 3.00% |
Current periodic costs | |||
Discount rate, preceding year (as a percent) | 3.50% | 3.90% | 4.00% |
Rate of compensation increase, preceding year (as a percent) | 3.00% | 3.00% | 3.00% |
Pension defined benefit plans | Plan assets | |||
Disclosure of net defined benefit liability (asset) | |||
Employer contributions | $ 34 | $ 35.5 | |
Postretirement defined benefit plans | |||
Benefit obligations | |||
Decrease of retirement benefit obligation due to increase of actuarial assumption of 10 basis points in discount rate | 1.5 | ||
Postretirement defined benefit plans | Plan assets | |||
Disclosure of net defined benefit liability (asset) | |||
Employer contributions | $ 1.7 | $ 1.9 |
DISCONTINUED OPERATIONS - Gener
DISCONTINUED OPERATIONS - General information (Details) - CAD ($) $ in Millions | Jan. 24, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Discontinued operations | ||||
DISCONTINUED OPERATIONS | ||||
Gain on disposal of businesses | $ 14.6 | |||
4Degrees Inc. Colocation data centers | ||||
DISCONTINUED OPERATIONS | ||||
Amount received from discontinued operations | $ 261.6 | |||
Gain on disposal of businesses | $ 118 | |||
The amount deferred from the proceeds received on discontinued operations | $ 53 | |||
Tax benefit on discontinued operations | $ 18.5 | |||
English-language newspaper operations | ||||
DISCONTINUED OPERATIONS | ||||
Gain on disposal of businesses | $ 14.6 |
DISCONTINUED OPERATIONS - Disco
DISCONTINUED OPERATIONS - Discontinued operations statements of income and comprehensive income (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
DISCONTINUED OPERATIONS | |||
Revenues | $ 4,181 | $ 4,125.1 | $ 4,057.1 |
Income from discontinued operations | 3.8 | 18.2 | 1 |
Discontinued operations | |||
DISCONTINUED OPERATIONS | |||
Revenues | 19.8 | 19.7 | 12 |
Expenses | 14.6 | 14.8 | 10.6 |
Income taxes | 1.4 | 1.3 | 0.4 |
Gain related to a business sold in 2015 | (14.6) | ||
Income from discontinued operations | $ 3.8 | $ 18.2 | $ 1 |
DISCONTINUED OPERATIONS - Dis_2
DISCONTINUED OPERATIONS - Discontinued operations statements cash flows (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
DISCONTINUED OPERATIONS | |||
Cash flows related to operating activities | $ 10.4 | $ 20.4 | $ 3.3 |
Cash flows related to investing activities | (1.9) | (3.5) | (53.1) |
Cash flows provided by (used in) discontinued operations | $ 8.5 | $ 16.9 | $ (49.8) |
DISCONTINUED OPERATIONS - Dis_3
DISCONTINUED OPERATIONS - Discontinued operations statements balance sheet (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Net assets held for sale | |||
Current assets | $ 1,134 | $ 1,877.8 | $ 944.8 |
Property, plant and equipment | 3,413.5 | 3,554.3 | 3,562.5 |
Assets | 10,097.5 | 9,921 | 9,458.6 |
Current liabilities | (1,396.4) | (1,130.2) | $ (1,175.6) |
Net assets | (4,895.2) | $ (3,889.1) | |
Assets and liabilities classified as held-for-sale | |||
Net assets held for sale | |||
Current assets | 1.3 | ||
Property, plant and equipment | 72.5 | ||
Intangible assets and goodwill | 21.2 | ||
Assets | 95 | ||
Current liabilities | (6.6) | ||
Net assets | $ 88.4 |
NON-CONSOLIDATED FINANCIAL ST_3
NON-CONSOLIDATED FINANCIAL STATEMENTS OF THE CORPORATION - Non-consolidated condensed statements of income and comprehensive income (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenues: | |||
Revenues | $ 4,181 | $ 4,125.1 | $ 4,057.1 |
Depreciation and amortization | 717.9 | 705.3 | 648.5 |
Financial expenses | 280.5 | 281.8 | 302 |
Loss (gain) on valuation and translation of financial instruments | 0.9 | 2.4 | 2.1 |
Loss on debt refinancing | 15.6 | 7.3 | |
Income before income taxes | 703.3 | 884 | 530 |
Income taxes (recovery) | 166.6 | 141.2 | 143.3 |
Net income | 540.5 | 761 | 387.7 |
Other comprehensive (loss) gain | (20.7) | 69.4 | 9.2 |
Comprehensive income | 519.8 | 830.4 | 396.9 |
Parent Company | |||
Revenues: | |||
Distributions in excess of the investments in subsidiaries | 503.3 | ||
Dividends | 113 | 295 | 282 |
Management fees | 59.2 | 58.8 | 59.9 |
Interest on loans to the parent corporation | 14.8 | ||
Other | 64.5 | 49.5 | 52.4 |
Revenues | 754.8 | 403.3 | 394.3 |
General and administrative expenses | 126.8 | 123.6 | 121.7 |
Depreciation and amortization | 3.8 | 4.3 | 3.3 |
Financial expenses | 106.1 | 130.3 | 138.9 |
Loss (gain) on valuation and translation of financial instruments | 0.2 | (0.7) | |
Loss on debt refinancing | 10.4 | ||
Impairment and disposal of investments in subsidiaries | 73.3 | ||
Loss on notes receivable from subsidiaries | 14.8 | ||
Other | 2.4 | (10.9) | 2 |
Income before income taxes | 515.5 | 146.3 | 40.3 |
Income taxes (recovery) | (5.3) | 0.6 | 1.7 |
Net income | 520.8 | 145.7 | 38.6 |
Other comprehensive (loss) gain | (3.9) | 22.8 | (3.3) |
Comprehensive income | $ 516.9 | $ 168.5 | $ 35.3 |
NON-CONSOLIDATED FINANCIAL ST_4
NON-CONSOLIDATED FINANCIAL STATEMENTS OF THE CORPORATION - Non-consolidated and condensed statements of cash flows (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows related to operations | |||
Net income | $ 540.5 | $ 761 | $ 387.7 |
Depreciation and amortization | 717.9 | 705.3 | 648.5 |
Loss (gain) on valuation and translation of financial instruments | 0.9 | 2.4 | 2.1 |
Amortization of financing costs and long-term debt discount | 6.8 | 6.9 | 7 |
Loss on debt refinancing | 15.6 | 7.3 | |
Deferred income taxes | 11.7 | 132.4 | (14.7) |
Other | (5.6) | 4 | 3.7 |
Net change in non-cash balances related to operations | 136.7 | (130.1) | 53 |
Cash flows related to investing activities | |||
Proceeds from disposal of subsidiaries | 3 | ||
Acquisition of tax deductions from the parent corporation | (13.9) | (14) | |
Other | (11.3) | (10.6) | 12.7 |
Cash flows related to financing activities | |||
Net change in bank indebtedness | 24.3 | (18.9) | (14.9) |
Net change under revolving facilities | 736.5 | (209.3) | (40.3) |
Repayments of long-term debt | (19.2) | (664.5) | (19) |
Settlement of hedging contracts | (1.6) | 16.6 | 0.4 |
Repurchase of Common Shares | (1,540) | (43.9) | |
Cash and cash equivalents at the beginning of the year | 864.9 | 20.7 | 18.6 |
Cash and cash equivalents at the end of the year | 21 | 864.9 | 20.7 |
Parent Company | |||
Cash flows related to operations | |||
Net income | 520.8 | 145.7 | 38.6 |
Depreciation and amortization | 3.8 | 4.3 | 3.3 |
Loss (gain) on valuation and translation of financial instruments | 0.2 | (0.7) | |
Amortization of financing costs and long-term debt discount | 2.3 | 2.4 | 2.8 |
Loss on debt refinancing | 10.4 | ||
Impairment and disposal of investments in subsidiaries | 73.3 | ||
Loss on notes receivable from subsidiaries | 14.8 | ||
Deferred income taxes | (5.3) | 2.5 | 1.8 |
Other | 0.2 | 2.4 | (0.3) |
Net change in non-cash balances related to operations | 5.3 | 39.3 | 7.5 |
Cash flows provided by operations | 527.3 | 206.3 | 141.8 |
Cash flows related to investing activities | |||
Net change in investments in subsidiaries | 2,058.6 | (8.5) | (63.5) |
Acquisition of tax deductions from the parent corporation | (13.9) | (14) | |
Other | (6) | (8.5) | 3.9 |
Cash flows provided by (used in) investing activities | 2,038.7 | (17) | (73.6) |
Cash flows related to financing activities | |||
Net change in bank indebtedness | 5.7 | (2.5) | (8.1) |
Net change under revolving facilities | (2.8) | ||
Repayments of long-term debt | (3.6) | (336.7) | (3.6) |
Settlement of hedging contracts | (1.6) | (1.6) | 5.2 |
Repurchase of Common Shares | (1,540) | (43.9) | |
Repurchase of redeemable preferred shares issued to subsidiaries | (430) | ||
Dividends and reduction of paid-up capital | (100) | (100) | (100) |
Net change in subordinated loans from subsidiaries | 2,322 | 66 | (2,768) |
Net change in convertible obligations, subordinated loans and notes receivable - subsidiaries | (2,664) | 276 | 3,199 |
Net change in loans to the parent corporation | (596.1) | ||
Net change in advances to or from subsidiaries | (19.6) | (15.4) | 40.1 |
Cash flows used in financing activities | (2,597.2) | (158.1) | $ (68.2) |
Net change in cash and cash equivalents | (31.2) | 31.2 | |
Cash and cash equivalents at the beginning of the year | $ 31.2 | ||
Cash and cash equivalents at the end of the year | $ 31.2 |
NON-CONSOLIDATED FINANCIAL ST_5
NON-CONSOLIDATED FINANCIAL STATEMENTS OF THE CORPORATION - Non-consolidated and condensed balance sheets (Details) - CAD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Assets | |||
Current assets | $ 1,134 | $ 1,877.8 | $ 944.8 |
Loans to the parent corporation | 596.1 | ||
Other assets | 201.5 | 185 | 176.9 |
Total assets | 10,097.5 | 9,921 | 9,458.6 |
Liabilities and equity | |||
Current liabilities | 1,396.4 | 1,130.2 | 1,175.6 |
Long-term debt | 6,318.4 | 5,292.6 | 5,617.2 |
Other liabilities | 213.3 | 195 | 202.8 |
Equity attributable to shareholders | 1,335.9 | 2,458.7 | 1,767.7 |
Total liabilities and equity | 10,097.5 | 9,921 | $ 9,458.6 |
Parent Company | |||
Assets | |||
Current assets | 144.2 | 161.8 | |
Investments in subsidiaries at cost | 477.8 | 2,536.4 | |
Advances to subsidiaries | 48.9 | 35.7 | |
Convertible obligations, subordinated loans and notes receivable - subsidiaries | 2,813 | 149 | |
Loans to the parent corporation | 596.1 | ||
Other assets | 488.9 | 347.2 | |
Total assets | 4,568.9 | 3,230.1 | |
Liabilities and equity | |||
Current liabilities | 87.6 | 66.3 | |
Long-term debt | 2,098.9 | 1,974.8 | |
Advances from subsidiaries | 138.8 | 145.2 | |
Other liabilities | 37.6 | 36.7 | |
Subordinated loan from subsidiaries | 2,813 | 491 | |
Equity attributable to shareholders | (607) | 516.1 | |
Total liabilities and equity | $ 4,568.9 | $ 3,230.1 |