Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2021shares | |
Cover [Abstract] | |
Document Type | 20-F |
Document Registration Statement | false |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Document Period End Date | Dec. 31, 2021 |
Entity File Number | 033-51000 |
Entity Registrant Name | VIDEOTRON LTEE |
Entity Incorporation, State or Country Code | A8 |
Entity Address, Address Line One | 612 St. Jacques Street |
Entity Address, City or Town | Montréal |
Entity Address, State or Province | QC |
Entity Address, Country | CA |
Entity Address, Postal Zip Code | H3C 4M8 |
Entity Common Stock, Shares Outstanding | 10,718,326.822 |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | Yes |
Entity Current Reporting Status | No |
Entity Interactive Data Current | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Emerging Growth Company | false |
Document Accounting Standard | International Financial Reporting Standards |
Entity Shell Company | false |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2021 |
Document Fiscal Period Focus | FY |
Amendment Flag | false |
Entity Central Index Key | 0000890746 |
Auditor Name | Ernst & Young LLP |
Auditor Firm ID | 1263 |
Auditor Location | Montreal, Canada |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues | |||
Internet | $ 1,201.4 | $ 1,131.4 | $ 1,114.3 |
Television | 836.1 | 903.6 | 974.4 |
Mobile telephony | 712.5 | 658.5 | 600.7 |
Wireline telephony | 318.5 | 338.4 | 341.1 |
Mobile equipment sales | 276.4 | 257.2 | 229.1 |
Wireline equipment sales | 204 | 151.7 | 40.7 |
Other | 186.1 | 181.7 | 175.8 |
Revenues | 3,735 | 3,622.5 | 3,476.1 |
Employee costs | 405.9 | 403.8 | 398.6 |
Purchase of goods and services | 1,453.4 | 1,354.3 | 1,274.7 |
Depreciation and amortization | 717.8 | 743.8 | 685.6 |
Financial expenses | 232.1 | 208.5 | 200 |
Loss on valuation and translation of financial instruments | 0.4 | 1.2 | 0.6 |
Restructuring of operations and other items | 11.6 | 29.4 | 20.2 |
Loss on debt refinancing | 40.1 | ||
Income before income taxes | 873.7 | 881.5 | 896.4 |
Income taxes (recovery): | |||
Current | 235.5 | 188.5 | 94.9 |
Deferred | (55.2) | (0.6) | 84.2 |
Income taxes | 180.3 | 187.9 | 179.1 |
Income from continuing operations | 693.4 | 693.6 | 717.3 |
Income from discontinued operations | 34.8 | 115.9 | |
Net income | 693.4 | 728.4 | 833.2 |
Income from continuing operations attributable to | |||
Shareholder | 693.3 | 693.5 | 717.2 |
Non-controlling interests | 0.1 | 0.1 | 0.1 |
Net income attributable to | |||
Shareholder | 693.3 | 728.3 | 833.1 |
Non-controlling interests | $ 0.1 | $ 0.1 | $ 0.1 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Income from continuing operations | $ 693.4 | $ 693.6 | $ 717.3 |
Cash flow hedges: | |||
Gain (loss) on valuation of derivative financial instruments | 4.6 | (17.1) | 50.6 |
Deferred income taxes | 1.4 | 4.9 | (2.7) |
Defined benefit plans: | |||
Re-measurement gain (loss) | 107.9 | (61) | (47.3) |
Deferred income taxes | (28.6) | 16.2 | 12.7 |
Reclassification to income: | |||
Gain related to cash flow hedges | (1) | ||
Deferred income taxes | 0.6 | ||
Other comprehensive income (loss) | 84.9 | (57) | 13.3 |
Comprehensive income from continuing operations | 778.3 | 636.6 | 730.6 |
Income from discontinued operations | 34.8 | 115.9 | |
Comprehensive income | 778.3 | 671.4 | 846.5 |
Comprehensive income from continuing operations attributable to | |||
Shareholder | 778.2 | 636.5 | 730.5 |
Non-controlling interests | 0.1 | 0.1 | 0.1 |
Comprehensive income attributable to | |||
Shareholder | 778.2 | 671.3 | 846.4 |
Non-controlling interests | $ 0.1 | $ 0.1 | $ 0.1 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - CAD ($) $ in Millions | Capital stock | Deficit | Accumulated other comprehensive loss | Equity attributable to non-controlling interests | Total |
Equity at beginning of period at Dec. 31, 2018 | $ 1,320.5 | $ (1,406.2) | $ (62) | $ 0.4 | $ (147.3) |
Net income | 833.1 | 0.1 | 833.2 | ||
Other comprehensive income (loss) | 13.3 | 13.3 | |||
Issuance of common shares | 153.3 | 153.3 | |||
Reduction of paid-up capital | (465) | (465) | |||
Dividends | (266) | (266) | |||
Equity at end of period at Dec. 31, 2019 | 1,008.8 | (839.1) | (48.7) | 0.5 | 121.5 |
Net income | 728.3 | 0.1 | 728.4 | ||
Other comprehensive income (loss) | (57) | (57) | |||
Issuance of common shares | 6.8 | 6.8 | |||
Dividends | (611) | (0.2) | (611.2) | ||
Equity at end of period at Dec. 31, 2020 | 1,015.6 | (721.8) | (105.7) | 0.4 | 188.5 |
Net income | 693.3 | 0.1 | 693.4 | ||
Other comprehensive income (loss) | 84.9 | 84.9 | |||
Reduction of paid-up capital | (720) | (720) | |||
Dividends | (585) | (0.1) | (585.1) | ||
Equity at end of period at Dec. 31, 2021 | $ 295.6 | $ (613.5) | $ (20.8) | $ 0.4 | $ (338.3) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows related to operating activities | |||
Income from continuing operations | $ 693.4 | $ 693.6 | $ 717.3 |
Adjustments for: | |||
Depreciation of property, plant and equipment | 542.4 | 586.8 | 558.1 |
Amortization of intangible assets | 136.7 | 122.6 | 95 |
Depreciation of right-of-use assets | 38.7 | 34.4 | 32.5 |
Loss on valuation and translation of financial instruments | 0.4 | 1.2 | 0.6 |
Impairment of assets | 0.8 | 8.4 | 15.3 |
Loss on debt refinancing | 40.1 | ||
Amortization of financing costs | 6.1 | 5.8 | 5.1 |
Deferred income taxes | (55.2) | (0.6) | 84.2 |
Other | 0.5 | (2) | 0.3 |
Cash flows before non-cash balances | 1,403.9 | 1,450.2 | 1,508.4 |
Net change in non-cash balances related to operating activities | (163.5) | 1.6 | (193.1) |
Cash flows provided by continuing operating activities | 1,240.4 | 1,451.8 | 1,315.3 |
Cash flows related to investing activities | |||
Business acquisitions | (6.7) | (32.9) | |
Additions to property, plant and equipment | (407.2) | (429.2) | (476.8) |
Additions to intangible assets | (986.1) | (180.2) | (468.1) |
Proceeds from disposals of assets | 7.7 | 3.5 | 4.1 |
Business disposal | 100.7 | ||
Other | (0.8) | (0.6) | |
Cash flows used in continuing investing activities | (1,393.1) | (639.4) | (840.1) |
Cash flows related to financing activities | |||
Net change in bank indebtedness | (7.1) | (1.2) | |
Net change under revolving facility | 285 | (89.3) | (649.1) |
Issuance of long-term debt, net of financing costs | 1,986.8 | 790.7 | |
Repayment of long-term debt | (1,023.3) | ||
Repayment of lease liabilities | (39.4) | (39.4) | (35.9) |
Settlement of hedging contracts | 185.2 | ||
Issuance of common shares | 6.8 | 153.3 | |
Dividends | (585) | (611) | (266) |
Dividends paid to non-controlling interests | (0.1) | (0.2) | |
Reduction of paid-up capital | (720) | (465) | |
Cash flows provided by (used in) continuing financing activities | 89.2 | (740.2) | (473.2) |
Cash flows (used in) provided by continuing operations | (63.5) | 72.2 | 2 |
Cash flows used in discontinued operations | (0.6) | (0.7) | |
Cash and cash equivalents at beginning of the year | 74 | 2.4 | 1.1 |
Cash and cash equivalents at end of the year | 10.5 | 74 | 2.4 |
Changes in non-cash balances related to operating activities (excluding the effect of business acquisitions and disposals) | |||
Accounts receivable | (201.3) | (53.9) | 1.6 |
Contract assets | 91.5 | (25.7) | (16.4) |
Amounts receivable from and payable to affiliated corporations | 16.3 | 2.4 | 16.5 |
Inventories | (33.5) | 10.6 | (26.8) |
Accounts payable, accrued charges and provisions | 2.5 | 40.9 | 16.2 |
Income taxes | (22.7) | 72.3 | (135.7) |
Deferred revenue | 13.9 | (27.8) | (9.8) |
Defined benefit plans | (1.7) | 9.7 | (19.2) |
Other | (28.5) | (26.9) | (19.5) |
Net change in non-cash balances related to operating activities | (163.5) | 1.6 | (193.1) |
Interest and taxes reflected as operating activities | |||
Cash interest payments | 244.8 | 211.7 | 193 |
Cash income tax payments (net of refunds) | $ 257.5 | $ 115.8 | $ 227.7 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS - Cash information - CAD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Cash and cash equivalents consist of | |||
Cash | $ 9.4 | $ 72.8 | $ 0.3 |
Cash equivalents | 1.1 | 1.2 | 2.1 |
Total cash and cash equivalents | $ 10.5 | $ 74 | $ 2.4 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - CAD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash and cash equivalents | $ 10.5 | $ 74 |
Restricted cash | 162.4 | |
Accounts receivable | 530.4 | 358.4 |
Contract assets | 129.4 | 174.9 |
Amounts receivable from affiliated corporations | 17.8 | 12.7 |
Inventories | 153.4 | 119.9 |
Other current assets | 116 | 103.4 |
Total current assets | 1,119.9 | 843.3 |
Non-current assets | ||
Property, plant and equipment | 2,761.6 | 2,879.5 |
Intangible assets | 2,212 | 1,351.4 |
Right-of-use assets. | 122.9 | 111.3 |
Goodwill | 542.6 | 538.1 |
Derivative financial instruments | 140.5 | 353.7 |
Investment in an affiliated corporation | 1,595 | 1,595 |
Promissory note to the parent corporation | 160 | 160 |
Other assets | 251.3 | 287.3 |
Total non-current assets | 7,785.9 | 7,276.3 |
Total assets | 8,905.8 | 8,119.6 |
Current liabilities | ||
Accounts payable, accrued charges and provisions | 568.4 | 608 |
Amounts payable to affiliated corporations | 89.2 | 67.9 |
Deferred revenue | 284.9 | 275.7 |
Deferred subsidies | 162.4 | |
Income taxes | 36 | 59.1 |
Current portion of lease liabilities | 35 | 32 |
Total current liabilities | 1,175.9 | 1,042.7 |
Non-current liabilities | ||
Long-term debt | 5,380.1 | 4,111.5 |
Subordinated loan from the parent corporation | 1,595 | 1,595 |
Lease liabilities | 118.8 | 110.3 |
Derivative financial instruments | 23.3 | 28.4 |
Deferred income taxes | 762.7 | 790.6 |
Other liabilities | 188.3 | 252.6 |
Total non-current liabilities | 8,068.2 | 6,888.4 |
Equity | ||
Capital stock | 295.6 | 1,015.6 |
Deficit | (613.5) | (721.8) |
Accumulated other comprehensive loss | (20.8) | (105.7) |
Equity attributable to the shareholder | (338.7) | 188.1 |
Non-controlling interests | 0.4 | 0.4 |
Total equity | (338.3) | 188.5 |
Commitments and contingencies | ||
Total liabilities and equity | $ 8,905.8 | $ 8,119.6 |
OTHER EXPLANATORY INFORMATION
OTHER EXPLANATORY INFORMATION | 12 Months Ended |
Dec. 31, 2021 | |
OTHER EXPLANATORY INFORMATION | |
OTHER EXPLANATORY INFORMATION | Videotron Ltd. (“Videotron” or the “Corporation”) is incorporated under the laws of Québec. The Corporation is a wholly owned subsidiary of Quebecor Media Inc. (“Quebecor Media” or the “parent corporation”) and the ultimate parent corporation is Quebecor inc. Unless the context otherwise requires, Videotron or the Corporation refer to Videotron Ltd. and its subsidiaries. The Corporation’s head office and registered office is located at 612 Saint-Jacques Street, Montreal, Québec, Canada. The percentages of voting rights and equity in its major subsidiaries are as follows: % equity and voting Videotron Infrastructures Inc. 100.0 % Videotron US Inc. 100.0 % Télédistribution Amos inc. 100.0 % SETTE Inc. 84.53 % The Corporation offers Internet access, television distribution, mobile and wireline telephony, business solutions and over-the-top video services in Canada. COVID-19 pandemic The COVID-19 pandemic has had a significant impact on the economic environment in Canada and around the world. In order to limit the spread of the virus, the Québec government has imposed a number of restrictions and special preventive measures since the beginning of this health crisis, including the suspension of some business activities. Since March 2020, this health crisis has curtailed the operations of many of Videotron’s business partners and has led to a significant slowdown in some of the Corporation’s operating activities. Among other impacts, the restrictions and preventive measures imposed by the Québec government have caused a reduction in volume at Videotron’s retail outlets. Given the uncertainty about the future evolution of the pandemic, including any new major wave, the full impact of the health crisis cannot be determined with certainty. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2021 | |
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 International Financial Reporting Standards (“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(i)), the liability related to stock-based compensation (note 1(s)) and the net defined benefit liability (note 1(t)), 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, 2020 and 2019 have been restated to conform to the presentation adopted for the year ended December 31, 2021. (b) 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. (c) 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 acquired business are recognized at their fair value at the acquisition date. Results of operations of an acquired business 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. (d) 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. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (e) 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 revenue” on the consolidated balance sheets. Deferred revenue is usually recognized as revenue in the subsequent year. The Corporation 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 can be comprised of an upfront fee or a number of monthly installments 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 Corporation recognizes each of its main activities’ revenues as follows: ● operating revenues from subscriber services, such as television distribution, Internet access, wireline 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 ● wireline connection and mobile activation revenues are deferred and recognized respectively as revenues over the period of time the customer is expected to remain a customer of the Corporation and over the contract term. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (e) Revenue recognition (continued) 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 on the consolidated balance sheets. Contract assets are realized over the term of the contract. (f) 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. (g) 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. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (g) Income taxes (continued) 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 when the income tax liability is no longer probable. (h) Leases The Corporation recognizes, for most of its leases, a right-of-use asset and a lease liability at the commencement of a lease. The right-of-use asset and the lease liability are initially measured at the present value of lease payments over the lease term, less incentive payments received, using the Corporation incremental borrowing rate at that date or the interest rate implicit in the lease. The term of the lease is comprised of the initial lease term and any additional period for which it is reasonably certain that the Corporation will exercise its extension option. Right-of-use assets are depreciated over the shorter of the lease term or the useful life of the underlying asset. Interest on lease liabilities is recorded in the consolidated statements of income as financial expenses and principal payments on the lease liability are presented as part of financing activities in the consolidated statements of cash flows. (i) Financial instruments Classification, recognition and measurement Most financial assets and liabilities are classified as subsequently measured at amortized cost, except for derivative financial instruments, investments in preferred shares of an affiliated corporation and loans from/to the parent corporation, which are measured at fair value through other comprehensive income or through profit or loss. Contingent consideration and future conditional adjustments 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. These foreign exchange forward contracts are designated as cash flow hedges. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (i) Financial instruments (continued) Derivative financial instruments and hedge accounting (continued) ● The Corporation uses cross-currency 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 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 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 has established a hedge ratio of one for one for all its hedging relationships as the 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 cash flows of the hedged item. ● 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. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (i) Financial instruments (continued) 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 on 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. (j) Financing costs Financing costs related to long-term debt are capitalized in reduction of long-term debt and amortized using the effective interest rate method. (k) Tax credits and government assistance The Corporation receives tax credits mainly related to its research and development activities and has access to several government programs designed to support large investment projects and the roll-out of high-speed Internet services in various regions of Québec. 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. (l) 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. (m) Trade receivables and contract assets Trade receivables 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. (n) 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. (o) Property, plant and equipment Property, plant and equipment are recorded at cost. Cost represents the acquisition costs, net of government subsidies and investment tax credits, or construction costs, including preparation, installation and testing costs. In the case of projects to construct wireline 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. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (o) Property, plant and equipment (continued) 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 5 to 40 years Furniture and equipment 3 to 7 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. A decommissioning obligation in connection with the Corporation’s mobile network is recorded at the net present value of the estimated future expenditures required to settle the estimated future obligation at the consolidated balance sheet date. Changes in estimates of the decommissioning obligation are reflected in property, plant and equipment on the consolidated balance sheets. The Corporation does not record any decommissioning obligations in connection with its wireline 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. The Corporation is engaged in an agreement to operate a shared LTE network in the Province of Québec and in the Ottawa area. (p) 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(f)). 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, in the view of 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; (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. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (p) Goodwill and intangible assets (continued) 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. Customer relationships and other intangible assets 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 Customer relationships and other 5 to 8 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. (q) 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. (r) Provisions Provisions are recognized (i) when 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 (ii) when 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 consolidated balance sheet date and changes in estimates are reflected in the consolidated statements of income in the reporting period in which the changes occur. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (s) Stock-based compensation Stock-based awards to employees that call for settlement in cash, deferred share units (“DSUs”) or performance share units (“PSUs”), or that call for settlement in cash at the option of the employee as stock option 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 20. (t) 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; and ● 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. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (t) Pension plans and postretirement benefits (continued) Re-measurements of the net defined benefit liability or asset are recognized immediately in other comprehensive income (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 to 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 and; ● 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 and 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. (u) 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 13. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (u) Use of estimates and judgments (continued) (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 the carrying value of other assets or other liabilities on the consolidated balance sheets. Key assumptions and a sensitivity analysis of the discount rate are presented in note 27. (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. It can also require an assessment of the probable outcomes of legal proceedings or other contingencies. Management expectations on the potential effect of the possible outcomes of legal disputes on the consolidated financial statements are presented in note 24. (iv) Contingent considerations and future conditional adjustments Contingent considerations and future conditional adjustments 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 and future conditional adjustments 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 or future conditional adjustments recognized and on 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 o |
EMPLOYEE COSTS AND PURCHASE OF
EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES | 12 Months Ended |
Dec. 31, 2021 | |
EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES | |
EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES | 2. The main components are as follows: 2021 2020 2019 Employee costs $ 574.3 $ 595.5 $ 605.2 Less employee costs capitalized to property, plant and equipment and to intangible assets (168.4) (191.7) (206.6) 405.9 403.8 398.6 Purchase of goods and services 1 Royalties and rights 401.0 403.9 397.8 Cost of products sold 497.3 444.6 368.6 Subcontracting costs 147.7 148.8 102.4 Marketing and distribution expenses 61.3 56.0 68.6 Other 346.1 301.0 337.3 1,453.4 1,354.3 1,274.7 $ 1,859.3 $ 1,758.1 $ 1,673.3 1 Cost of inventories included in purchase of goods and services amounted to $435.5 million in 2021 ($378.5 million in 2020 and $299.3 million in 2019). Write-downs of inventories totalling $2.0 million were recognized in purchase of goods and services in 2021 ($1.7 million in 2020 and $3.1 million in 2019). |
FINANCIAL EXPENSES
FINANCIAL EXPENSES | 12 Months Ended |
Dec. 31, 2021 | |
FINANCIAL EXPENSES | |
FINANCIAL EXPENSES | 3. FINANCIAL EXPENSES 2021 2020 2019 Third parties: Interest on long-term debt $ 228.0 $ 204.3 $ 195.8 Amortization of financing costs 6.1 5.8 5.1 Interest on lease liabilities 5.4 4.9 4.6 Interest on net defined benefit liability 5.4 4.4 4.3 Gain on foreign currency translation of short-term monetary items (1.1) (2.1) (2.0) Other (3.7) (0.9) (0.1) 240.1 216.4 207.7 Affiliated corporations: Interest expense 175.5 167.0 207.3 Dividend income (177.4) (168.8) (209.5) Interest on lease liabilities 1.7 1.8 2.0 Interest income (7.8) (7.9) (7.5) (8.0) (7.9) (7.7) $ 232.1 $ 208.5 $ 200.0 |
RESTRUCTURING OF OPERATIONS AND
RESTRUCTURING OF OPERATIONS AND OTHER ITEMS | 12 Months Ended |
Dec. 31, 2021 | |
RESTRUCTURING OF OPERATIONS AND OTHER ITEMS | |
RESTRUCTURING OF OPERATIONS AND OTHER ITEMS | 4. In 2021, a charge of $10.8 million was recorded in connection with cost reduction initiatives ($21.0 million in 2020 and $4.9 million in 2019), while an asset impairment charge of $0.8 million was also recorded in 2021 ($8.4 million in 2020 and $15.3 million in 2019). |
LOSS ON DEBT REFINANCING
LOSS ON DEBT REFINANCING | 12 Months Ended |
Dec. 31, 2021 | |
LOSS ON DEBT REFINANCING | |
LOSS ON DEBT REFINANCING | 5. LOSS ON DEBT REFINANCING On June 3, 2021, Videotron issued a redemption notice for its Senior Notes in aggregate principal amount of US$800.0 million, bearing interest at 5.000% and due July 15, 2022, at a redemption price of 104.002% of their principal amount. As a result, a net loss of $40.1 million was recorded in the consolidated statement of income in 2021, including a gain of $1.0 million previously recorded in other comprehensive income. In July 2021, the Senior Notes were redeemed, and the related hedging contracts were unwound, for a total cash consideration of $838.1 million, including the early redemption premium. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2021 | |
INCOME TAXES | |
INCOME TAXES | 6. The following table reconciles income taxes at the Corporation’s domestic statutory tax rate of 26.5% in 2021 (26.5% in 2020 and 26.6% in 2019) with income taxes in the consolidated statements of income: 2021 2020 2019 Income taxes at domestic statutory tax rate $ 231.5 $ 233.6 $ 238.5 (Reduction) increase resulting from: Non-deductible charges, non-taxable income and differences between current and future tax rates (5.7) (1.5) (3.7) Tax consolidation transactions (note 26) (47.0) (44.7) (55.7) Other 1.5 0.5 — Income taxes $ 180.3 $ 187.9 $ 179.1 6. INCOME TAXES (continued) 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 2021 2020 2021 2020 2019 Defined benefit plans $ 23.9 $ 50.2 $ (2.3) $ (2.5) $ 5.2 Contract assets (41.2) (65.5) (24.3) 6.7 4.5 Property, plant and equipment (435.5) (459.9) (24.4) (15.7) 9.2 Goodwill, intangible assets and other assets (327.6) (319.5) 7.4 11.7 67.0 Long-term debt and derivative financial instruments (7.1) (15.2) (6.1) 0.6 1.1 Other 24.8 19.3 (5.5) (1.4) (2.8) $ (762.7) $ (790.6) $ (55.2) $ (0.6) $ 84.2 Changes in the net deferred income tax liability are as follows: 2021 2020 Balance at beginning of year $ (790.6) $ (809.5) Recognized in income as continuing operations 55.2 0.6 Recognized in other comprehensive income (26.6) 21.1 Business acquisitions (0.7) (2.8) Balance at end of year $ (762.7) $ (790.6) There are no income tax consequences attached to the payment of dividends or distributions by the Corporation to its shareholder. |
BUSINESS ACQUISITIONS
BUSINESS ACQUISITIONS | 12 Months Ended |
Dec. 31, 2021 | |
BUSINESS ACQUISITIONS | |
BUSINESS ACQUISITIONS | 7 In 2021, the Corporation acquired businesses for a total cash consideration of $6.7 million. On December 31, 2020, Videotron closed the acquisition of Télédistribution Amos inc. and its network in Abitibi-Témiscamingue for a cash consideration of $32.9 million , net of cash acquired of $0.1 million. The acquired assets consist mainly of the network, intangible assets and goodwill. |
RESTRICTED CASH AND DEFERRED SU
RESTRICTED CASH AND DEFERRED SUBSIDIES | 12 Months Ended |
Dec. 31, 2021 | |
RESTRICTED CASH AND DEFERRED SUBSIDIES | |
RESTRICTED CASH AND DEFERRED SUBSIDIES | 8. On March 22, 2021, Videotron and the Québec government, jointly with the Canadian government, signed agreements to support the achievement of the government’s targets for the roll-out of high-speed Internet services in various regions of Québec. Under these agreements, Videotron will extend its high-speed Internet network to connect approximately 37,000 additional households and the government has committed to provide financial assistance in the amount of approximately $258.0 million , which will be fully invested in Videotron’s network extension. In accordance with the terms of the agreements, an amount of $216.2 million received in advance from the government in March 2021 was classified as restricted cash with a corresponding amount recorded as deferred subsidies on the consolidated balance sheets. In 2021, $53.8 million of these deferred subsidies were recognized as a reduction of additions to property, plant and equipment, upon the realization of the required investments. |
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE | 12 Months Ended |
Dec. 31, 2021 | |
ACCOUNTS RECEIVABLE | |
ACCOUNTS RECEIVABLE | 9. ACCOUNTS RECEIVABLE 2021 2020 Trade $ 479.3 $ 338.7 Other 51.1 19.7 $ 530.4 $ 358.4 |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2021 | |
PROPERTY, PLANT AND EQUIPMENT | |
PROPERTY, PLANT AND EQUIPMENT | 10. Changes in the net carrying amount of property, plant and equipment are as follows: Land, buildings and Telecom- Projects leasehold Furniture and munication under improvements equipment networks development Total Cost Balance as of December 31, 2019 $ 232.4 $ 1,681.1 $ 6,389.4 $ 85.8 $ 8,388.7 Additions 8.5 56.6 230.3 133.8 429.2 Net change in additions financed with non-cash balances (0.1) 1.5 (57.1) (7.5) (63.2) Reclassification — (59.6) 184.6 (125.0) — Retirement, disposals and other 1.2 (116.5) (228.8) — (344.1) Balance as of December 31, 2020 242.0 1,563.1 6,518.4 87.1 8,410.6 Additions 5.9 49.0 178.6 173.7 407.2 Net change in additions financed with non-cash balances — (0.4) (1.1) (11.8) (13.3) Decommissioning obligation — — 37.1 — 37.1 Reclassification (8.4) 8.0 153.6 (153.2) — Retirement, disposals and other (5.7) (236.7) (45.4) — (287.8) Balance as of December 31, 2021 $ 233.8 $ 1,383.0 $ 6,841.2 $ 95.8 $ 8,553.8 Land, buildings and Telecom- Projects leasehold Furniture and munication under improvements equipment networks development Total Accumulated depreciation and impairment losses Balance as of December 31, 2019 $ 86.9 $ 1,269.7 $ 3,932.0 $ — $ 5,288.6 Depreciation 7.1 124.9 454.8 — 586.8 Retirement, disposals and other — (113.7) (230.6) — (344.3) Balance as of December 31, 2020 94.0 1,280.9 4,156.2 — 5,531.1 Depreciation 6.9 99.4 436.1 — 542.4 Retirement, disposals and other (5.9) (230.1) (45.3) — (281.3) Balance as of December 31, 2021 $ 95.0 $ 1,150.2 $ 4,547.0 $ — $ 5,792.2 Net carrying amount As of December 31, 2020 $ 148.0 $ 282.2 $ 2,362.2 $ 87.1 $ 2,879.5 As of December 31, 2021 $ 138.8 $ 232.8 $ 2,294.2 $ 95.8 $ 2,761.6 10. PROPERTY, PLANT AND EQUIPMENT (continued) In 2020, the depreciation of certain components of the Corporation’s telecommunication networks was accelerated in order to reflect shorter remaining useful lives as a result of technology changes. Depreciation was increased by $24.0 million in 2020 to reflect the new useful lives. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2021 | |
INTANGIBLE ASSETS | |
INTANGIBLE ASSETS | 11. INTANGIBLE ASSETS Changes in the net carrying amount of intangible assets are as follows: Customer relationships, projects under Spectrum development licences Software and other Total Cost Balance as of December 31, 2019 $ 979.3 $ 1,180.6 $ 100.5 $ 2,260.4 Additions — 122.0 58.2 180.2 Net change in additions financed with non-cash balances — (114.9) 62.2 (52.7) Business acquisitions — 0.1 9.7 9.8 Reclassification — 99.7 (99.7) — Retirement, disposals and other — (19.1) — (19.1) Balance as of December 31, 2020 979.3 1,268.4 130.9 2,378.6 Additions 1 830.0 87.6 68.5 986.1 Net change in additions financed with non-cash balances — (36.2) 45.1 8.9 Business acquisitions — — 2.3 2.3 Reclassification — 34.5 (34.5) — Retirement, disposals and other — (15.2) — (15.2) Balance as of December 31, 2021 $ 1,809.3 $ 1,339.1 $ 212.3 $ 3,360.7 Customer relationships, projects Spectrum development licences Software and other Total Accumulated amortization and impairment losses Balance as of December 31, 2019 $ 247.7 $ 670.9 $ 5.1 $ 923.7 Amortization — 120.3 2.3 122.6 Retirement, disposals and other — (19.1) – (19.1) Balance as of December 31, 2020 247.7 772.1 7.4 1,027.2 Amortization — 133.2 3.5 136.7 Retirement, disposals and other — (15.2) – (15.2) Balance as of December 31, 2021 $ 247.7 $ 890.1 $ 10.9 $ 1,148.7 Net carrying amount As of December 31, 2020 $ 731.6 $ 496.3 $ 123.5 $ 1,351.4 As of December 31, 2021 $ 1,561.6 $ 449.0 $ 201.4 $ 2,212.0 11. INTANGIBLE ASSETS (continued) 1 In 2021, Videotron acquired 294 blocks of spectrum in the 3500 MHz band across the country. More than half of the investment is concentrated in four Canadian provinces outside Québec: southern and eastern Ontario, Manitoba, Alberta and British Columbia. Videotron made an initial deposit of $166.0 million in the third quarter of 2021 for the acquisition of these spectrum licences. The final payment of $664.0 million was made on December 17, 2021. The cost of internally generated intangible assets, mainly composed of software, was $773.2 million as of December 31, 2021 ($631.5 million as of December 31, 2020). For the year ended December 31, 2021, the Corporation recorded additions of internally generated intangible assets of $154.2 million ($73.1 million in 2020 and $40.1 million in 2019). The accumulated amortization and impairment losses on internally generated intangible assets, mainly composed of software, were $422.9 million as of December 31, 2021 ($388.4 million as of December 31, 2020). For the year ended December 31, 2021, the Corporation recorded $46.9 million in amortization on its internally generated intangible assets ($44.0 million in 2020 and $39.5 million in 2019). The net carrying value of internally generated intangible assets was $350.3 million as of December 31, 2021 ($243.1 million as of December 31, 2020). The net carrying value of intangible assets with an indefinite useful life was $1,562.8 million as of December 31, 2021 ($732.8 million as of December 31, 2020). |
RIGHT-OF-USE ASSETS
RIGHT-OF-USE ASSETS | 12 Months Ended |
Dec. 31, 2021 | |
RIGHT-OF-USE ASSETS | |
RIGHT-OF-USE ASSETS | 12. RIGHT-OF-USE ASSETS Changes in the net carrying amount of right-of-use assets which mainly relate to leases of premises and vehicles, are as follows: 2021 2020 Cost Balance at beginning of year $ 319.3 $ 271.6 Additions financed with lease obligations 50.9 67.5 Retirement and other (17.4) (19.8) Balance at end of year 352.8 319.3 Accumulated depreciation Balance at beginning of year 208.0 186.1 Depreciation 38.7 34.4 Retirement and other (16.8) (12.5) Balance at end of year 229.9 208.0 Net carrying amount $ 122.9 $ 111.3 The Corporation does not recognize right-of-use assets and lease liabilities for short-term leases and leases of low value assets. The net carrying amount includes right-of-use assets with affiliated corporations of $17.5 million as of December 31, 2021 ($15.3 million as of December 31, 2020). The depreciation expense on leases with affiliated corporations was $3.9 million in 2021 ($3.8 million in 2020). |
GOODWILL
GOODWILL | 12 Months Ended |
Dec. 31, 2021 | |
GOODWILL | |
GOODWILL | 13. GOODWILL Changes in the net carrying amount of goodwill are as follows: 2021 2020 Cost Balance at beginning of year $ 606.6 $ 583.5 Business acquisitions 4.5 23.1 Balance at end of year 611.1 606.6 Accumulated impairment losses Balance at beginning and at end of year 68.5 68.5 Net carrying amount $ 542.6 $ 538.1 Recoverable amount The recoverable amount of the Telecommunications CGU was 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 the 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 the CGU or for each nature of expenses, as well as for future capital expenditures. Such assumptions will consider, among many other factors, subscribers, competitive landscape, evolution of product and service offerings, wireless penetration growth, technology evolution, 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 the 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 CGU participates. The following key assumptions were used to determine recoverable amounts in the most recent impairment tests performed: 2021 2020 Pre-tax discount Perpetual Pre-tax discount Perpetual CGU group rate (WACC) growth rate rate (WACC) growth rate Telecommunications 1 8.5 % 2.0 % 8.5 % 2.0 % 1 The same recoverable amount used in the 2020 annual impairment test was used in 2021. Accordingly, pre-tax discount rate and perpetual growth rate are the same in 2021 and 2020. The recoverable amounts was based on value in use, using the discounted cash flow method. 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 Telecommunications CGU to equal its carrying value. |
OTHER ASSETS
OTHER ASSETS | 12 Months Ended |
Dec. 31, 2021 | |
OTHER ASSETS | |
OTHER ASSETS | 14. OTHER ASSETS 2021 2020 Contract assets 1 $ 155.6 $ 247.0 Contract costs 2 174.8 148.2 Equipment installments receivable 358.6 148.6 Other 17.1 89.9 706.1 633.7 Less current portion of contract assets (129.4) (174.9) Less current portion of contract costs (included in “Other current assets”) (68.5) (59.9) Less current portion of equipment installments receivable (included in “Accounts receivable”) (256.9) (111.6) $ 251.3 $ 287.3 1 Impairment loss on contract assets resulting from mobile contracts being cancelled prior to their initial term amounted to $17.1 million in 2021 ($20.5 million in 2020 and $19.7 million in 2019), 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 $73.3 million in 2021 ($65.9 million in 2020 and $63.6 million in 2019). |
ACCOUNTS PAYABLE, ACCRUED CHARG
ACCOUNTS PAYABLE, ACCRUED CHARGES AND PROVISIONS | 12 Months Ended |
Dec. 31, 2021 | |
ACCOUNTS PAYABLE, ACCRUED CHARGES AND PROVISIONS | |
ACCOUNTS PAYABLE, ACCRUED CHARGES AND PROVISIONS | 15. ACCOUNTS PAYABLE, ACCRUED CHARGES AND PROVISIONS 2021 2020 Trade and accruals $ 448.2 $ 458.3 Salaries and employee benefits 67.8 82.7 Interest payable 42.7 52.4 Provisions and other 9.7 14.6 $ 568.4 $ 608.0 |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2021 | |
LONG-TERM DEBT | |
LONG-TERM DEBT | 16. Effective interest rate as of December 31, 2021 2021 2020 Bank credit facility (i) 1.90 % $ 285.0 $ — Senior Notes (ii) 5,123.2 4,120.0 5,408.2 4,120.0 Change in fair value related to hedged interest rate risk 8.3 16.8 Financing costs, net of amortization (36.4) (25.3) $ 5,380.1 $ 4,111.5 As of December 31, 2021, the carrying value of long-term debt denominated in U.S. dollars, excluding financing costs, was $2,156.6 million ($2,561.8 million as of December 31, 2020) while the net fair value of related hedging derivative instruments was in an asset position of $116.3 million ($333.3 million as of December 31, 2020). (i) The bank credit facility provides for a $1,500.0 million secured revolving credit facility that matures in July 2023 and bears interest at Bankers’ acceptance rate, London Inter-bank Offered Rate (“LIBOR”), Canadian prime rate or U.S. prime rate, plus a premium determined by the Corporation’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 the Corporation and most of its wholly owned subsidiaries. As of December 31, 2021, the bank credit facility was secured by assets with a carrying value of $8,900.3 million ($8,114.0 million in 2020). The bank credit facility contains covenants such as maintaining certain financial ratios, as well as limitations on the Corporation’s ability to incur additional indebtedness, pay dividends, or make other distributions. As of December 31, 2021, $285.0 million was drawn on the secured revolving credit facility (no amount was drawn as of December 31, 2020). (ii) The Senior Notes are unsecured and contain certain restrictions on the Corporation, including limitations on its 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 three or 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 are guaranteed by specific subsidiaries of the Corporation. The following table summarizes the terms of the outstanding Senior Notes as of December 31, 2021: 16. Annual nominal Interest payable Principal amount interest rate Maturity date every 6 months on US $ 600.0 5.375 % June 15, 2024 June and December 15 $ 400.0 5.625 % June 15, 2025 April and October 15 $ 375.0 5.750 % January 15, 2026 March and September 15 US $ 600.0 5.125 % April 15, 2027 April and October 15 $ 800.0 4.500 % January 15, 2030 April and October 15 $ 650.0 1 3.125 % January 15, 2031 January and July 15 $ 750.0 2 3.625 % June 15, 2028 June and December 15 US $ 500.0 3 3.625 % June 15, 2029 June and December 15 1 The Notes were issued in January 2021 for net proceeds of $644.0 million, net of financing costs of $6.0 million. 2 The Notes were issued in June 2021 for net proceeds of $743.2 million, net of financing costs of $6.8 million. 3 The Notes were issued in June 2021 for net proceeds of $599.6 million, net of financing costs of $5.8 million. On December 31, 2021, the Corporation was in compliance with all debt covenants. Principal repayments of long-term debt over the coming years are as follows: 2022 $ — 2023 285.0 2024 758.2 2025 400.0 2026 375.0 2027 and thereafter 3,590.0 Changes in long-term debt are as follows: 2021 2020 Balance at beginning of year $ 4,111.5 $ 4,240.2 Net change under revolving facility, net of financing costs 285.0 (89.3) Issuance of long-term debt, net of financing costs 1,986.8 — Repayment of long-term debt, excluding early redemption premium (983.7) — Foreign currency translation (18.5) (52.9) Amortization of financing costs 6.1 5.8 Change in fair value related to hedged interest rate risk (8.5) 7.7 Other 1.4 — Balance at end of year $ 5,380.1 $ 4,111.5 |
LEASE LIABILITIES
LEASE LIABILITIES | 12 Months Ended |
Dec. 31, 2021 | |
LEASE LIABILITIES | |
LEASE LIABILITIES | 17. LEASE LIABILITIES Changes in lease liabilities are as follows: 2021 2020 Balance at beginning of year $ 142.3 $ 114.2 Lease obligations financing right-of-use assets 50.9 67.5 Repayments (39.4) (39.4) 153.8 142.3 Less current portion (35.0) (32.0) $ 118.8 $ 110.3 Lease liabilities with affiliated corporations amounted to $25.9 million as of December 31, 2021 ($26.3 million in 2020). Interest rates on lease liabilities ranged from 1.9%to 8.5% as of December 31, 2021 and 2020. Repayments of lease liabilities over the coming years are as follows: 2022 $ 35.0 2023 32.4 2024 27.4 2025 19.6 2026 13.5 2027 and thereafter 25.9 |
OTHER LIABILITIES
OTHER LIABILITIES | 12 Months Ended |
Dec. 31, 2021 | |
OTHER LIABILITIES | |
OTHER LIABILITIES | 18. Note 2021 2020 Defined benefit plans 27 $ 90.2 $ 196.1 Decommissioning obligation 59.0 19.3 Other 39.1 37.2 $ 188.3 $ 252.6 |
CAPITAL STOCK
CAPITAL STOCK | 12 Months Ended |
Dec. 31, 2021 | |
CAPITAL STOCK | |
CAPITAL STOCK | 19. (a) Authorized capital stock An unlimited number of common shares, without par value, voting and participating. An unlimited number of preferred shares, Series B Series C Series D Series E Series F Series H An unlimited number of preferred shares, Series G 19. CAPITAL STOCK (continued) (b) Issued and outstanding capital stock Common shares Number Amount Balance as of December 31, 2019 10,711,165 $ 1,008.8 Issuance of common shares 7,162 6.8 Balance as of December 31, 2020 10,718,327 1,015.6 Reduction of paid-up capital — (720.0) Balance as of December 31, 2021 10,718,327 $ 295.6 Issuance of common shares On January 25, 2019, the Corporation issued 162,640 common shares to its parent corporation for a cash consideration of $150.0 million. On July 26, 2019, the Corporation issued 3,563 common shares to its parent corporation for a cash consideration of $3.3 million. On January 30, 2020, the Corporation issued 3,406 common shares to its parent corporation for a cash consideration of $3.3 million. On July 29, 2020, the Corporation issued 3,756 common shares to its parent corporation for a cash consideration of $3.5 million. Reduction of paid-up capital During the year ended December 31, 2019, the Corporation reduced its paid-up capital for total cash considerations of $465.0 million. During the year ended December 31, 2021, the Corporation reduced its paid-up capital for cash considerations of $720.0 million. |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS | 12 Months Ended |
Dec. 31, 2021 | |
STOCK-BASED COMPENSATION PLANS | |
STOCK-BASED COMPENSATION PLANS | 20. (a) Ultimate parent corporation plan (i) Stock option plan Under a stock option plan established by the ultimate parent corporation, 26,000,000 Quebecor Inc. Class B Subordinate Shares (“Quebecor Class B Shares”) have been set aside for directors, officers, senior employees, and other key employees of the ultimate parent corporation and those of the Corporation. The exercise price of each option is equal to the weighted average trading price of the 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 2/3 three years 33 1/3% The following table gives details on changes to outstanding options for the years ended December 31, 2021 and 2020: 2021 2020 Weighted Weighted average average Options exercise price Options exercise price Balance at beginning of year 1,467,700 $ 30.56 1,033,900 $ 29.19 Granted — — 555,000 33.19 Exercised (39,998) 26.52 — — Cancelled (883,768) 30.73 (121,200) 30.95 Balance at end of year 543,934 $ 30.58 1,467,700 $ 30.56 Vested options at end of year 51,864 $ 26.52 — $ — During the year ended December 31, 2021, 39,998 stock options of the ultimate parent corporation were exercised for a cash consideration of $0.2 million (none in 2020). As of December 31, 2021, exercise prices of all outstanding options were from $26.52 to $33.19 and the average years to maturity was 7.7. 20. STOCK-BASED COMPENSATION PLANS (continued) (a) Ultimate parent corporation plan (continued) (ii) The DSUs are based on Quebecor Class B Subordinate Voting Shares (“Quebecor 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. DSUs entitle the holders to receive additional units when dividends are paid on Quebecor Class B Shares. As of December 31, 2021, 23,293 DSUs were outstanding under this plan (85,007 as of December 31, 2020). During the first quarter of 2020, a cash consideration of $1.6 million was paid relating to a performance share unit plan terminated in 2020. (b) Parent corporation stock option plan During the year ended December 31, 2021, 30,000 stock options of the parent corporation were exercised for a cash consideration of $2.0 million (16,500 stock options for $1.0 million in 2020).As of December 31, 2021, there were no outstanding option related to the parent corporation stock option plan. (c) Assumptions in estimating the fair value of stock-based awards The fair value of stock-based awards under the stock option plans 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: December 31, 2021 Ultimate parent corporation Risk-free interest rate 1.32 % Distribution yield 3.91 % Expected volatility 22.35 % Expected remaining life 3.7 years December 31, 2020 Ultimate parent Parent corporation corporation Risk-free interest rate 0.54 % 0.27 % Distribution yield 2.43 % 1.00 % Expected volatility 21.15 % 28.96 % Expected remaining life 4.6 years 1.0 year 20. STOCK-BASED COMPENSATION PLANS (continued) (c) Assumptions in estimating the fair value of stock-based awards (continued) 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. The expected remaining life of options granted represents the period of time that options granted are expected to be outstanding. The risk-free interest 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. (d) Liability for vested options As of December 31, 2021, the liability for all vested options was $0.1 million as calculated using the intrinsic value ($1.9 million as of December 31, 2020). (e) Consolidated stock-based compensation charge For the year ended December 31, 2021, a reversal of the consolidated charge related to all stock-based compensation plans was recorded in the amount of $1.8 million (a charge of $1.9 million in 2020 and $5.5 million in 2019). |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE LOSS ATTRIBUTABLE TO SHAREHOLDER | 12 Months Ended |
Dec. 31, 2021 | |
ACCUMULATED OTHER COMPREHENSIVE LOSS ATTRIBUTABLE TO SHAREHOLDER | |
ACCUMULATED OTHER COMPREHENSIVE LOSS ATTRIBUTABLE TO SHAREHOLDER | 21. Defined Cash flow hedges 1 benefit plans Total Balance as of December 31, 2018 $ (14.9) $ (47.1) $ (62.0) Other comprehensive income (loss) 47.9 (34.6) 13.3 Balance as of December 31, 2019 33.0 (81.7) (48.7) Other comprehensive loss (12.2) (44.8) (57.0) Balance as of December 31, 2020 20.8 (126.5) (105.7) Other comprehensive income 5.6 79.3 84.9 Balance as of December 31, 2021 $ 26.4 $ (47.2) $ (20.8) 1 No significant amount is expected to be reclassified in income over the next 12 months in connection with derivatives designated as cash flow hedges. The balance is expected to reverse over a 7 1/2 -year period. |
COMMITMENTS
COMMITMENTS | 12 Months Ended |
Dec. 31, 2021 | |
COMMITMENTS | |
COMMITMENTS | 22. The Corporation has entered into long-term commitments to purchase services, tangible and intangible assets, and to pay licences and royalties. The minimum payments for the coming years are as follows: 2022 $ 112.9 2023 to 2026 255.2 2027 and thereafter 146.4 |
GUARANTEES
GUARANTEES | 12 Months Ended |
Dec. 31, 2021 | |
GUARANTEES | |
GUARANTEES | 23. In the normal course of business, the Corporation enters into numerous agreements containing guarantees, including the following: 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 on the consolidated balance sheets. 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 on the consolidated balance sheets with respect to these indemnifications. |
CONTINGENCIES
CONTINGENCIES | 12 Months Ended |
Dec. 31, 2021 | |
CONTINGENCIES | |
CONTINGENCIES | 24. CONTINGENCIES There are a number of legal proceedings against the Corporation that are pending. At this stage of proceedings, management of the Corporation is in the opinion that the outcome is not expected to have a material adverse effect on the Corporation’s results or on its financial position. Generally, management of the Corporation establishes provisions for claims or actions considering the facts of each case. The Corporation cannot determine when and if any payment will be made related to these legal proceedings. In August 2021, a competitor launched legal proceedings in Federal Court contesting the awarding of licences in the 3500 MHZ band in Western Canada to Videotron (note 11). This case is currently before the Court. On August 15, 2019, the CRTC issued an order to finalize the rates, retroactively to March 31, 2016, at which the large cable and telephone companies provide aggregated wholesale access to their high-speed Internet networks. The interim rates in effect since 2016 had been invoiced to resellers and accounted for in the Corporation’s consolidated financial statements on the basis of the effective date of March 31, 2016. The new proposed rates were substantially lower than the interim rates. On May 27, 2021, the CRTC restored, in a final decision, the interim rates that had been in effect since 2016. Accordingly, no adjustments are necessary to the consolidated financial statements. |
FINANCIAL INSTRUMENTS AND FINAN
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | 12 Months Ended |
Dec. 31, 2021 | |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | 25. 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. 25. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (continued) The Corporation uses a number of financial instruments, mainly cash and cash equivalents, restricted cash, trade receivables, contract assets, bank indebtedness, trade payables, accrued liabilities, long-term debt, lease liabilities 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 and (ii) to achieve a targeted balance of fixed- and floating-rate debt. 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 per one U.S. Notional Notional Maturity dollar amount sold amount bought Less than 1 year 1.2578 $ 177.4 US$ 141.0 (ii) Cross-currency swaps Hedged item Hedging instrument CAN dollar Annual interest exchange rate on rate on notional interest and Period Notional amount in capital payments covered amount CAN dollars per one U.S. dollar 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 3.625% Senior Notes due 2029 2021 to 2029 US$ 500.0 4.04 % 1.2109 Certain cross-currency 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 ● 25. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (continued) (b) Fair value of financial instruments (continued) ● ● 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 on 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, 2021 and 2020 are as follows: 2021 2020 Carrying Fair Carrying Fair Asset (liability) value value value value Long-term debt 1 $ (5,408.2) $ (5,470.2) $ (4,120.0) $ (4,419.2) Derivative financial instruments 2 Foreign exchange forward contracts 0.9 0.9 (8.0) (8.0) Cross-currency swaps 116.3 116.3 333.3 333.3 1 The carrying value of long-term debt excludes changes in the fair value of long-term debt related to hedged interest rate risk and financing costs. 2 The net fair value of derivative financial instruments designated as cash flow hedges is an asset position of $83.0 million as of December 31, 2021 ($280.7 million in 2020) and the net fair value of derivative financial instruments designated as fair value hedges is an asset position of $34.2 million as of December 31, 2021 ($44.6 million in 2020). The fair value of investments in preferred shares in a subsidiary of the parent corporation and loans from the parent corporation is equivalent to their initial issuance values (note 26) since these financial instruments have only been issued as part of transactions carried out for tax consolidation purposes of Quebecor Media Inc. and its subsidiaries. (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. 25. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (continued) (c) The gross carrying amounts of financial assets represent the maximum credit exposure. As of December 31, 2021, the gross carrying amount of trade receivables and contract assets, including their long-term portions, was $751.1 million ($638.5 million as of December 31, 2020). 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. The Corporation uses its customers’ historical terms of payment and acceptable collection periods for each customer class, as well as changes in its customers’ credit profiles, to define default to collect amounts receivable from customers, including contract assets. As of December 31, 2021, 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, 2021, the provision for expected credit losses represented 1.9% of the gross amount of trade receivables and contract assets (2.5% as of December 31, 2020), while 5.3% of trade receivables were 90 days past their billing date (4.1% as of December 31, 2020). The following table shows changes to the provision for expected credit losses for the years ended December 31, 2021 and 2020: 2021 2020 Balance at beginning of year $ 15.7 $ 14.3 Changes in expected credit losses charged to income 16.6 20.0 Write-off (17.9) (18.6) Balance at end of year $ 14.4 $ 15.7 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 5.8 years as of December 31, 2021 (5.1 years as of December 31, 2020). 25. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (continued) (d) 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 the shareholder. 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, 2021, material contractual obligations related to financial instruments included capital repayment and interest on long-term debt and on lease liabilities 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 Accounts payable and accrued charges $ 559.2 $ 559.2 $ — $ — $ — Amounts payable to affiliated corporations 89.2 89.2 — — — Long-term debt 1 5,408.2 — 1,043.2 775.0 3,590.0 Interest payments on long-term debt 2 1,294.7 189.9 437.7 337.3 329.8 Lease liabilities 153.8 35.0 59.8 33.1 25.9 Interest payments on lease liabilities 19.8 5.9 7.8 3.8 2.3 Derivative financial instruments 3 (76.2) — (96.0) — 19.8 Total $ 7,448.7 $ 879.2 $ 1,452.5 $ 1,149.2 $ 3,967.8 1 The carrying value of long-term debt excludes changes in the fair value of long-term debt related to hedged interest rate risk and financing costs. 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, 2021. 3 Estimated future receipts, net of future disbursements, on derivative financial instruments related to foreign exchange hedging on the principal of U.S.-dollar-denominated debt . (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. 25. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (continued) (e) Market risk (continued) 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, gateways, modems, mobile devices 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, 2021, and to hedge its exposure on certain purchases of set-top boxes, gateways, modems, mobile devices 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, 2021 is as follows: Other comprehensive Increase (decrease) Income income Increase of $0.10 $ 0.7 $ 31.0 Decrease of $0.10 (0.7) (31.0) A variance of $0.10 in the 2021 average exchange rate of CAN dollar per one U.S. dollar would have resulted in a variance of $8.8 million on the value of unhedged purchases of goods and services and $6.6 million on the value of unhedged acquisitions of tangible and intangible assets in 2021. 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 swap agreements in order to manage cash flow risk exposure. As of December 31, 2021, after taking into account the hedging instruments, long-term debt was comprised of 91.4% fixed-rate debt (95.4% in 2020) and 8.6% floating-rate debt (4.6% in 2020). The estimated sensitivity on interest payments, of a 100 basis-point variance in the year-end Canadian Bankers’ acceptance rate as of December 31, 2021 was $4.6 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, 2021, as per the Corporation’s valuation models, is as follows: Other comprehensive Increase (decrease) Income income Increase of 100 basis points $ (0.7) $ (2.5) Decrease of 100 basis points 0.7 2.5 25. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (continued) (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 issuance and repurchase of shares, the use of cash flows generated by operations, and the level of distributions to the shareholder. 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, lease liabilities, derivative financial instruments, cash and cash equivalents and promissory note to the parent corporation. The capital structure as of December 31, 2021 and 2020 is as follows: 2021 2020 Long-term debt $ 5,380.1 $ 4,111.5 Lease liabilities 153.8 142.3 Derivative financial instruments (117.2) (325.3) Cash and cash equivalents (10.5) (74.0) Promissory note to the parent corporation (160.0) (160.0) Net liabilities 5,246.2 3,694.5 Equity $ (338.3) $ 188.5 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, 2021 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | 26. 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: 2021 2020 2019 Salaries and short-term benefits $ 3.2 $ 5.6 $ 6.1 Share-based compensation (1.3) 1.2 3.9 Termination and other long-term benefits 0.9 0.3 0.3 $ 2.8 $ 7.1 $ 10.3 26. RELATED PARTY TRANSACTIONS (continued) Operating transactions During the years ended December 31, 2021, 2020 and 2019, the Corporation incurred expenses with affiliated corporations, which are included in purchase of goods and services, and acquired property, plant and equipment and intangible assets from affiliated corporations. The Corporation also made sales to affiliated corporations. These transactions were accounted for at the consideration agreed between the parties. 2021 2020 2019 Ultimate parent and parent corporation Revenues $ 0.4 $ 0.4 $ 0.5 Purchase of goods and services 10.2 9.6 9.9 Operating expenses recovered (2.3) (1.4) (2.6) Corporations under common control Revenues 5.3 4.9 5.5 Purchase of goods and services 109.7 95.7 123.2 Operating expenses recovered 0.4 1.4 (3.0) Other affiliated corporations Purchase of goods and services 10.6 5.6 2.1 Acquisition of property, plant and equipment and intangible assets 4.6 – – Management arrangements The Corporation pays annual management fees to the parent corporation for services rendered to the Corporation, including internal audit, legal and corporate, financial planning and treasury, tax, real estate, human resources, risk management, public relations and other services. Management fees amounted to $40.5 million in 2021 ($41.0 million in 2020 and $50.0 million in 2019). In addition, the parent corporation is entitled to the reimbursement of out-of-pocket expenses incurred in connection with the services provided under the agreement. These transactions were accounted for at the consideration agreed between the parties. Accounts receivable from affiliated corporations 2021 2020 Ultimate parent and parent corporation Accounts receivable $ 2.8 $ 2.8 Dividends receivable 5.0 5.0 Interest receivable 2.5 2.4 Corporations under common control Accounts receivable 7.5 2.5 $ 17.8 $ 12.7 26. RELATED PARTY TRANSACTIONS (continued) Accounts payable to affiliated corporations 2021 2020 Ultimate parent and parent corporation Accounts payable $ 21.2 $ 33.9 Interest payable 5.0 5.0 Corporations under common control Accounts payable 63.0 29.0 $ 89.2 67.9 Tax consolidation transactions 2021 2020 Investment in an affiliated corporation 1 $ 1,595.0 $ 1,595.0 Subordinated loan from the parent corporation 2 (1,595.0) (1,595.0) 1 Investment in 1,595,000 preferred shares, Series C, of 9346-9963 Quebec Inc., a subsidiary of Quebecor Media Inc., carrying the right to receive an annual dividend of 9.6%, payable semi-annually. 2 Subordinated loan of $1,595.0 million from Quebecor Media Inc., bearing interest at a rate of 9.5%, payable semi-annually, and maturing on February 27, 2048. On October 11, 2019, the Corporation contracted a subordinated loan of $2,950.0 million from Quebecor Media Inc., bearing interest at a rate of 10.0 %, payable semi-annually, and maturing on October 11, 2049. On the same day, the Corporation invested the total proceeds of $2,950.0 million into 2,950,000 preferred shares, Series D, of 9346-9963 Quebec Inc. These shares carry the right to receive an annual dividend of 10.1%, payable semi-annually. On December 19, 2019, 9346-9963 Quebec Inc. redeemed 2,950,000 preferred shares, Series D for a total cash consideration of $2,950.0 million. On the same day, the Corporation used the total proceeds of $2,950.0 million to repay its subordinated loans contracted from Quebecor Media Inc. On November 12, 2020, the Corporation contracted a subordinated loan of $1,700.0 million from Quebecor Media inc, bearing interest at a rate of 9.0%, payable semi-annually, and maturing on November 12, 2050. On the same day, the Corporation invested the total proceeds of $1,700.0 million into 1,700,000 preferred shares, Series L, of 9346-9963 Quebec Inc. These shares carry the right to receive an annual dividend of 9.1%, payable semi-annually. On December 18, 2020, 9346-9963 Quebec Inc. redeemed 1,700,000 preferred shares, Series L for a total cash consideration of $1,700.0 million. On the same day, the Corporation used the total proceeds of $1,700.0 million to repay its subordinated loans contracted from Quebecor Media Inc. On October 1, 2021, the Corporation contracted a subordinated loan of $1,473.0 million from Quebecor Media inc, bearing interest at a rate of 8.5%, payable semi-annually, and maturing on October 1, 2051. On the same day, the Corporation invested the total proceeds of $1,473.0 million into 1,473,000 preferred shares, Series M, of 9346-9963 Quebec Inc. These shares carry the right to receive an annual dividend of 8.6%, payable semi-annually. 26. RELATED PARTY TRANSACTIONS (continued) Tax consolidation transactions (continued) On December 10, 2021, 9346-9963 Quebec Inc. redeemed 1,473,000 preferred shares, Series M for a total cash consideration of $1,473.0 million. On the same day, the Corporation used the total proceeds of $1,473.0 million to repay its subordinated loans contracted from Quebecor Media Inc. All these transactions were carried out for tax consolidation purposes of Quebecor Media Inc. and its subsidiaries. |
PENSION PLANS AND POSTRETIREMEN
PENSION PLANS AND POSTRETIREMENT BENEFITS | 12 Months Ended |
Dec. 31, 2021 | |
PENSION PLANS AND POSTRETIREMENT BENEFITS | |
PENSION PLANS AND POSTRETIREMENT BENEFITS | 27. The Corporation maintains various defined benefit and 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 and Risk Management 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 committee 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. 27. PENSION PLANS AND POSTRETIREMENT BENEFITS (continued) 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, 2021 and 2020: Pension benefits Postretirement benefits 2021 2020 2021 2020 Change in benefit obligations Benefit obligations at the beginning of the year $ 686.4 $ 570.4 $ 46.0 $ 40.9 Service costs 27.0 26.1 1.7 1.6 Interest costs 18.9 17.8 1.2 1.2 Plan participants’ contributions 5.4 6.2 — — Actuarial (gain) loss arising from: Financial assumptions (74.6) 82.7 (5.5) 6.3 Demographic assumptions 11.3 — — — Participant experience 3.3 (0.6) — — Benefits and settlements paid (19.7) (17.2) (0.7) (0.8) Plan amendments and other 1.0 1.0 (3.8) (3.2) Benefit obligations at the end of the year $ 659.0 $ 686.4 $ 38.9 $ 46.0 Pension benefits Postretirement benefits 2021 2020 2021 2020 Change in plan assets Fair value of plan assets at the beginning of the year $ 536.3 $ 485.8 $ — $ — Actual return on plan assets 57.0 43.1 — — Employer contributions 29.3 19.0 0.7 0.8 Plan participants’ contributions 5.4 6.2 — — Benefits and settlements paid (19.7) (17.2) (0.7) (0.8) Administrative fees (0.6) (0.6) — — Fair value of plan assets at the end of the year $ 607.7 $ 536.3 $ — $ — As of December 31, 2021, the weighted average duration of defined benefit obligations was 18.5 years (19.0 years in 2020). The Corporation expects future benefit payments of $16.9 million in 2022. 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 asset classes is used to optimize the risk-return profile of plan assets and to mitigate asset-liability mismatch. Plan assets are comprised of: 2021 2020 Equity securities: Canadian 21.0 % 21.9 % Foreign 30.2 30.8 Debt securities 39.5 39.8 Other 9.3 7.5 100.0 % 100.0 % 27. PENSION PLANS AND POSTRETIREMENT BENEFITS (continued) The fair value of 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 on 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 on the consolidated balance sheets is as follows: Pension benefits Postretirement benefits 2021 2020 2021 2020 Benefit obligations $ (659.0) $ (686.4) $ (38.9) $ (46.0) Fair value of plan assets 607.7 536.3 — — Plan deficit and net amount recognized 1 $ (51.3) $ (150.1) $ (38.9) $ (46.0) 1 The net liability recognized for 2021 is $90.2 million ($196.1 million in 2020) and is included in “Other liabilities” (note 18). Components of re-measurements are as follows: Pension benefits Postretirement benefits 2021 2020 2019 2021 2020 2019 Actuarial gain (loss) on benefit obligations $ 60.0 $ (82.1) $ (75.5) $ 5.5 $ (6.3) $ (10.8) Actual return on plan assets, less interest income anticipated in the interest on the net defined benefit liability calculation 42.4 27.4 39.0 — — — Re-measurement gain (loss) recorded in other comprehensive income (loss) $ 102.4 $ (54.7) $ (36.5) $ 5.5 $ (6.3) $ (10.8) Components of the net benefit costs are as follows: Pension benefits Postretirement benefits 2021 2020 2019 2021 2020 2019 Employee costs: Service costs $ 27.0 $ 26.1 $ 21.0 $ 1.7 $ 1.6 $ 2.1 Plan amendments, administrative fees and other 0.5 0.6 0.7 (3.8) (3.2) (23.3) Interest on net defined benefit liability 4.2 3.2 2.5 1.2 1.2 1.8 Net benefit costs (gain) $ 31.7 $ 29.9 $ 24.2 $ (0.9) $ (0.4) $ (19.4) The expense related to defined contribution pension plans amounted to $17.6 million in 2021 ($16.0 million in 2020 and $15.6 million in 2019). 27. PENSION PLANS AND POSTRETIREMENT BENEFITS (continued) The expected employer contributions to the Corporation’s defined benefit pension plans and postretirement benefit plans will be $27.1 million in 2022, based on the most recent financial actuarial reports filed (contributions of $30.0 million were paid in 2021). 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, 2021, 2020 and 2019 and current periodic benefit costs are as follows: Pension and postretirement benefits 2021 2020 2019 Benefit obligations Rates as of year-end: Discount rate 3.00 % 2.50 % 3.10 % Rate of compensation increase 3.00 3.00 3.00 Current periodic costs Rates as of preceding year-end: Discount rate 2.50 % 3.10 % 3.90 % Rate of compensation increase 3.00 3.00 3.00 The assumed average retirement age of participants used was 62 years in 2021, 2020 and 2019. The assumed health care cost trend rate used in measuring the accumulated postretirement benefit obligations was 6.50% at the end of 2021. These costs, as per the estimate, are expected to decrease gradually over the next five years to 5.10% and to remain at that level thereafter. Sensitivity analysis An increase of 10 |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 12 Months Ended |
Dec. 31, 2021 | |
DISCONTINUED OPERATIONS | |
DISCONTINUED OPERATIONS | 28. On January 22, 2019, the Corporation sold to Quebecor Media Inc. its 4Degrees Colocation Inc. data centre operations, which were ultimately sold to a third party on January 24, 2019 for an amount of $261.6 million fully paid in cash at the date of transaction. An amount of $0.9 million relating to a working capital adjustment was also paid by the Corporation. 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, a gain on disposal of $115.7 million (without any tax consequence), was accounted for in the first quarter of 2019, while an amount of $53.1 million from the proceeds received at the date of transaction was deferred in connection with the estimated present value of the future conditional adjustments. In the year ended December 31, 2020, a net gain of $34.8 million (without any tax consequence) was recorded as certain adjusting conditions were achieved. These discontinued operations were transferred to Quebecor Media Inc. in exchange of a promissory note receivable bearing interest at a rate of 4.90% for an amount of $260.7 million, from which $100.7 million was reimbursed subsequently. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of presentation | (a) Basis of presentation The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“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(i)), the liability related to stock-based compensation (note 1(s)) and the net defined benefit liability (note 1(t)), 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, 2020 and 2019 have been restated to conform to the presentation adopted for the year ended December 31, 2021. |
Consolidation | (b) 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 | (c) 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 acquired business are recognized at their fair value at the acquisition date. Results of operations of an acquired business 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. |
Foreign currency translation | (d) 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 | (e) 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 revenue” on the consolidated balance sheets. Deferred revenue is usually recognized as revenue in the subsequent year. The Corporation 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 can be comprised of an upfront fee or a number of monthly installments 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 Corporation recognizes each of its main activities’ revenues as follows: ● operating revenues from subscriber services, such as television distribution, Internet access, wireline 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 ● wireline connection and mobile activation revenues are deferred and recognized respectively as revenues over the period of time the customer is expected to remain a customer of the Corporation and 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 on the consolidated balance sheets. Contract assets are realized over the term of the contract. |
Impairment of assets | (f) 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. |
Income taxes | (g) 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 when the income tax liability is no longer probable. |
Leases | (h) Leases The Corporation recognizes, for most of its leases, a right-of-use asset and a lease liability at the commencement of a lease. The right-of-use asset and the lease liability are initially measured at the present value of lease payments over the lease term, less incentive payments received, using the Corporation incremental borrowing rate at that date or the interest rate implicit in the lease. The term of the lease is comprised of the initial lease term and any additional period for which it is reasonably certain that the Corporation will exercise its extension option. Right-of-use assets are depreciated over the shorter of the lease term or the useful life of the underlying asset. Interest on lease liabilities is recorded in the consolidated statements of income as financial expenses and principal payments on the lease liability are presented as part of financing activities in the consolidated statements of cash flows. |
Financial instruments | (i) Financial instruments Classification, recognition and measurement Most financial assets and liabilities are classified as subsequently measured at amortized cost, except for derivative financial instruments, investments in preferred shares of an affiliated corporation and loans from/to the parent corporation, which are measured at fair value through other comprehensive income or through profit or loss. Contingent consideration and future conditional adjustments 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. These foreign exchange forward contracts are designated as cash flow hedges. Derivative financial instruments and hedge accounting (continued) ● The Corporation uses cross-currency 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 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 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 has established a hedge ratio of one for one for all its hedging relationships as the 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 cash flows of the hedged item. ● 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 on 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 costs | (j) Financing costs Financing costs 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 | (k) Tax credits and government assistance The Corporation receives tax credits mainly related to its research and development activities and has access to several government programs designed to support large investment projects and the roll-out of high-speed Internet services in various regions of Québec. 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 | (l) 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. |
Trade receivables and contract assets | (m) Trade receivables and contract assets Trade receivables 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 | (n) 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. |
Property, plant and equipment | (o) Property, plant and equipment Property, plant and equipment are recorded at cost. Cost represents the acquisition costs, net of government subsidies and investment tax credits, or construction costs, including preparation, installation and testing costs. In the case of projects to construct wireline 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 5 to 40 years Furniture and equipment 3 to 7 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. A decommissioning obligation in connection with the Corporation’s mobile network is recorded at the net present value of the estimated future expenditures required to settle the estimated future obligation at the consolidated balance sheet date. Changes in estimates of the decommissioning obligation are reflected in property, plant and equipment on the consolidated balance sheets. The Corporation does not record any decommissioning obligations in connection with its wireline 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. The Corporation is engaged in an agreement to operate a shared LTE network in the Province of Québec and in the Ottawa area. |
Goodwill and intangible assets | (p) 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(f)). 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, in the view of 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; (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. 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. Customer relationships and other intangible assets 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 Customer relationships and other 5 to 8 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 | (q) 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 | (r) Provisions Provisions are recognized (i) when 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 (ii) when 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 consolidated 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 | (s) Stock-based compensation Stock-based awards to employees that call for settlement in cash, deferred share units (“DSUs”) or performance share units (“PSUs”), or that call for settlement in cash at the option of the employee as stock option 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 20. |
Pension plans and postretirement benefits | (t) 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; and ● 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 income (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 to 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 and; ● 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 and 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 | (u) 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 13. (u) Use of estimates and judgments (continued) (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 the carrying value of other assets or other liabilities on the consolidated balance sheets. Key assumptions and a sensitivity analysis of the discount rate are presented in note 27. (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. It can also require an assessment of the probable outcomes of legal proceedings or other contingencies. Management expectations on the potential effect of the possible outcomes of legal disputes on the consolidated financial statements are presented in note 24. (iv) Contingent considerations and future conditional adjustments Contingent considerations and future conditional adjustments 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 and future conditional adjustments 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 or future conditional adjustments recognized and on 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. (u) Use of estimates and judgments (continued) (iii) Interpretation of laws and regulations Interpretation of laws and regulation, including those of the Canadian Radio-television and Telecommunications Commission (“CRTC”) and tax regulations, requires judgment from management and could have an impact on revenue recognition, provisions, income taxes and capital expenditures in the consolidated financial statements. |
OTHER EXPLANATORY INFORMATION (
OTHER EXPLANATORY INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
OTHER EXPLANATORY INFORMATION | |
Schedule of major subsidiaries | % equity and voting Videotron Infrastructures Inc. 100.0 % Videotron US Inc. 100.0 % Télédistribution Amos inc. 100.0 % SETTE Inc. 84.53 % |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of fixed assets useful lives | Assets Estimated useful lives Buildings and leasehold improvements 5 to 40 years Furniture and equipment 3 to 7 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 Customer relationships and other 5 to 8 years |
EMPLOYEE COSTS AND PURCHASE O_2
EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES | |
Schedule of employee costs and purchase of goods and services | 2021 2020 2019 Employee costs $ 574.3 $ 595.5 $ 605.2 Less employee costs capitalized to property, plant and equipment and to intangible assets (168.4) (191.7) (206.6) 405.9 403.8 398.6 Purchase of goods and services 1 Royalties and rights 401.0 403.9 397.8 Cost of products sold 497.3 444.6 368.6 Subcontracting costs 147.7 148.8 102.4 Marketing and distribution expenses 61.3 56.0 68.6 Other 346.1 301.0 337.3 1,453.4 1,354.3 1,274.7 $ 1,859.3 $ 1,758.1 $ 1,673.3 1 Cost of inventories included in purchase of goods and services amounted to $435.5 million in 2021 ($378.5 million in 2020 and $299.3 million in 2019). Write-downs of inventories totalling $2.0 million were recognized in purchase of goods and services in 2021 ($1.7 million in 2020 and $3.1 million in 2019). |
FINANCIAL EXPENSES (Tables)
FINANCIAL EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
FINANCIAL EXPENSES | |
Schedule of financial expenses | 2021 2020 2019 Third parties: Interest on long-term debt $ 228.0 $ 204.3 $ 195.8 Amortization of financing costs 6.1 5.8 5.1 Interest on lease liabilities 5.4 4.9 4.6 Interest on net defined benefit liability 5.4 4.4 4.3 Gain on foreign currency translation of short-term monetary items (1.1) (2.1) (2.0) Other (3.7) (0.9) (0.1) 240.1 216.4 207.7 Affiliated corporations: Interest expense 175.5 167.0 207.3 Dividend income (177.4) (168.8) (209.5) Interest on lease liabilities 1.7 1.8 2.0 Interest income (7.8) (7.9) (7.5) (8.0) (7.9) (7.7) $ 232.1 $ 208.5 $ 200.0 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
INCOME TAXES | |
Schedule of reconciliation of income taxes at Corporation's domestic statutory tax rate | 2021 2020 2019 Income taxes at domestic statutory tax rate $ 231.5 $ 233.6 $ 238.5 (Reduction) increase resulting from: Non-deductible charges, non-taxable income and differences between current and future tax rates (5.7) (1.5) (3.7) Tax consolidation transactions (note 26) (47.0) (44.7) (55.7) Other 1.5 0.5 — Income taxes $ 180.3 $ 187.9 $ 179.1 |
Schedule of net deferred income tax liability and their impact on deferred income tax expense | Consolidated Consolidated balance sheets income statements 2021 2020 2021 2020 2019 Defined benefit plans $ 23.9 $ 50.2 $ (2.3) $ (2.5) $ 5.2 Contract assets (41.2) (65.5) (24.3) 6.7 4.5 Property, plant and equipment (435.5) (459.9) (24.4) (15.7) 9.2 Goodwill, intangible assets and other assets (327.6) (319.5) 7.4 11.7 67.0 Long-term debt and derivative financial instruments (7.1) (15.2) (6.1) 0.6 1.1 Other 24.8 19.3 (5.5) (1.4) (2.8) $ (762.7) $ (790.6) $ (55.2) $ (0.6) $ 84.2 |
Summary of changes in net deferred income tax liability | 2021 2020 Balance at beginning of year $ (790.6) $ (809.5) Recognized in income as continuing operations 55.2 0.6 Recognized in other comprehensive income (26.6) 21.1 Business acquisitions (0.7) (2.8) Balance at end of year $ (762.7) $ (790.6) |
ACCOUNTS RECEIVABLE (Tables)
ACCOUNTS RECEIVABLE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
ACCOUNTS RECEIVABLE | |
ACCOUNTS RECEIVABLE | 2021 2020 Trade $ 479.3 $ 338.7 Other 51.1 19.7 $ 530.4 $ 358.4 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
PROPERTY, PLANT AND EQUIPMENT | |
Schedule of changes in the net carrying amount of property, plant and equipment | Land, buildings and Telecom- Projects leasehold Furniture and munication under improvements equipment networks development Total Cost Balance as of December 31, 2019 $ 232.4 $ 1,681.1 $ 6,389.4 $ 85.8 $ 8,388.7 Additions 8.5 56.6 230.3 133.8 429.2 Net change in additions financed with non-cash balances (0.1) 1.5 (57.1) (7.5) (63.2) Reclassification — (59.6) 184.6 (125.0) — Retirement, disposals and other 1.2 (116.5) (228.8) — (344.1) Balance as of December 31, 2020 242.0 1,563.1 6,518.4 87.1 8,410.6 Additions 5.9 49.0 178.6 173.7 407.2 Net change in additions financed with non-cash balances — (0.4) (1.1) (11.8) (13.3) Decommissioning obligation — — 37.1 — 37.1 Reclassification (8.4) 8.0 153.6 (153.2) — Retirement, disposals and other (5.7) (236.7) (45.4) — (287.8) Balance as of December 31, 2021 $ 233.8 $ 1,383.0 $ 6,841.2 $ 95.8 $ 8,553.8 Land, buildings and Telecom- Projects leasehold Furniture and munication under improvements equipment networks development Total Accumulated depreciation and impairment losses Balance as of December 31, 2019 $ 86.9 $ 1,269.7 $ 3,932.0 $ — $ 5,288.6 Depreciation 7.1 124.9 454.8 — 586.8 Retirement, disposals and other — (113.7) (230.6) — (344.3) Balance as of December 31, 2020 94.0 1,280.9 4,156.2 — 5,531.1 Depreciation 6.9 99.4 436.1 — 542.4 Retirement, disposals and other (5.9) (230.1) (45.3) — (281.3) Balance as of December 31, 2021 $ 95.0 $ 1,150.2 $ 4,547.0 $ — $ 5,792.2 Net carrying amount As of December 31, 2020 $ 148.0 $ 282.2 $ 2,362.2 $ 87.1 $ 2,879.5 As of December 31, 2021 $ 138.8 $ 232.8 $ 2,294.2 $ 95.8 $ 2,761.6 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
INTANGIBLE ASSETS | |
Schedule of changes in the net carrying amount of intangible assets | Customer relationships, projects under Spectrum development licences Software and other Total Cost Balance as of December 31, 2019 $ 979.3 $ 1,180.6 $ 100.5 $ 2,260.4 Additions — 122.0 58.2 180.2 Net change in additions financed with non-cash balances — (114.9) 62.2 (52.7) Business acquisitions — 0.1 9.7 9.8 Reclassification — 99.7 (99.7) — Retirement, disposals and other — (19.1) — (19.1) Balance as of December 31, 2020 979.3 1,268.4 130.9 2,378.6 Additions 1 830.0 87.6 68.5 986.1 Net change in additions financed with non-cash balances — (36.2) 45.1 8.9 Business acquisitions — — 2.3 2.3 Reclassification — 34.5 (34.5) — Retirement, disposals and other — (15.2) — (15.2) Balance as of December 31, 2021 $ 1,809.3 $ 1,339.1 $ 212.3 $ 3,360.7 Customer relationships, projects Spectrum development licences Software and other Total Accumulated amortization and impairment losses Balance as of December 31, 2019 $ 247.7 $ 670.9 $ 5.1 $ 923.7 Amortization — 120.3 2.3 122.6 Retirement, disposals and other — (19.1) – (19.1) Balance as of December 31, 2020 247.7 772.1 7.4 1,027.2 Amortization — 133.2 3.5 136.7 Retirement, disposals and other — (15.2) – (15.2) Balance as of December 31, 2021 $ 247.7 $ 890.1 $ 10.9 $ 1,148.7 Net carrying amount As of December 31, 2020 $ 731.6 $ 496.3 $ 123.5 $ 1,351.4 As of December 31, 2021 $ 1,561.6 $ 449.0 $ 201.4 $ 2,212.0 11. INTANGIBLE ASSETS (continued) 1 In 2021, Videotron acquired 294 blocks of spectrum in the 3500 MHz band across the country. More than half of the investment is concentrated in four Canadian provinces outside Québec: southern and eastern Ontario, Manitoba, Alberta and British Columbia. Videotron made an initial deposit of $166.0 million in the third quarter of 2021 for the acquisition of these spectrum licences. The final payment of $664.0 million was made on December 17, 2021. |
RIGHT-OF-USE ASSETS (Tables)
RIGHT-OF-USE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
RIGHT-OF-USE ASSETS | |
Schedule of changes in the net carrying amount of right-of-use assets, which mainly relates to leases of premises | 2021 2020 Cost Balance at beginning of year $ 319.3 $ 271.6 Additions financed with lease obligations 50.9 67.5 Retirement and other (17.4) (19.8) Balance at end of year 352.8 319.3 Accumulated depreciation Balance at beginning of year 208.0 186.1 Depreciation 38.7 34.4 Retirement and other (16.8) (12.5) Balance at end of year 229.9 208.0 Net carrying amount $ 122.9 $ 111.3 |
GOODWILL (Tables)
GOODWILL (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
GOODWILL | |
Schedule of changes in the net carrying amount of goodwill | 2021 2020 Cost Balance at beginning of year $ 606.6 $ 583.5 Business acquisitions 4.5 23.1 Balance at end of year 611.1 606.6 Accumulated impairment losses Balance at beginning and at end of year 68.5 68.5 Net carrying amount $ 542.6 $ 538.1 |
Schedule of determination of recoverable amounts in the impairment tests performed in significant CGU groups | 2021 2020 Pre-tax discount Perpetual Pre-tax discount Perpetual CGU group rate (WACC) growth rate rate (WACC) growth rate Telecommunications 1 8.5 % 2.0 % 8.5 % 2.0 % 1 The same recoverable amount used in the 2020 annual impairment test was used in 2021. Accordingly, pre-tax discount rate and perpetual growth rate are the same in 2021 and 2020. The recoverable amounts was based on value in use, using the discounted cash flow method. |
OTHER ASSETS (Tables)
OTHER ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
OTHER ASSETS | |
Schedule of other assets | 2021 2020 Contract assets 1 $ 155.6 $ 247.0 Contract costs 2 174.8 148.2 Equipment installments receivable 358.6 148.6 Other 17.1 89.9 706.1 633.7 Less current portion of contract assets (129.4) (174.9) Less current portion of contract costs (included in “Other current assets”) (68.5) (59.9) Less current portion of equipment installments receivable (included in “Accounts receivable”) (256.9) (111.6) $ 251.3 $ 287.3 1 Impairment loss on contract assets resulting from mobile contracts being cancelled prior to their initial term amounted to $17.1 million in 2021 ($20.5 million in 2020 and $19.7 million in 2019), 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 $73.3 million in 2021 ($65.9 million in 2020 and $63.6 million in 2019). |
ACCOUNTS PAYABLE, ACCRUED CHA_2
ACCOUNTS PAYABLE, ACCRUED CHARGES AND PROVISIONS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
ACCOUNTS PAYABLE, ACCRUED CHARGES AND PROVISIONS | |
Schedule of accounts payable and accrued charges and provisions | 2021 2020 Trade and accruals $ 448.2 $ 458.3 Salaries and employee benefits 67.8 82.7 Interest payable 42.7 52.4 Provisions and other 9.7 14.6 $ 568.4 $ 608.0 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
LONG-TERM DEBT | |
Schedule of long-term debt | Effective interest rate as of December 31, 2021 2021 2020 Bank credit facility (i) 1.90 % $ 285.0 $ — Senior Notes (ii) 5,123.2 4,120.0 5,408.2 4,120.0 Change in fair value related to hedged interest rate risk 8.3 16.8 Financing costs, net of amortization (36.4) (25.3) $ 5,380.1 $ 4,111.5 As of December 31, 2021, the carrying value of long-term debt denominated in U.S. dollars, excluding financing costs, was $2,156.6 million ($2,561.8 million as of December 31, 2020) while the net fair value of related hedging derivative instruments was in an asset position of $116.3 million ($333.3 million as of December 31, 2020). (i) The bank credit facility provides for a $1,500.0 million secured revolving credit facility that matures in July 2023 and bears interest at Bankers’ acceptance rate, London Inter-bank Offered Rate (“LIBOR”), Canadian prime rate or U.S. prime rate, plus a premium determined by the Corporation’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 the Corporation and most of its wholly owned subsidiaries. As of December 31, 2021, the bank credit facility was secured by assets with a carrying value of $8,900.3 million ($8,114.0 million in 2020). The bank credit facility contains covenants such as maintaining certain financial ratios, as well as limitations on the Corporation’s ability to incur additional indebtedness, pay dividends, or make other distributions. As of December 31, 2021, $285.0 million was drawn on the secured revolving credit facility (no amount was drawn as of December 31, 2020). (ii) The Senior Notes are unsecured and contain certain restrictions on the Corporation, including limitations on its 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 three or 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 are guaranteed by specific subsidiaries of the Corporation. The following table summarizes the terms of the outstanding Senior Notes as of December 31, 2021: 16. Annual nominal Interest payable Principal amount interest rate Maturity date every 6 months on US $ 600.0 5.375 % June 15, 2024 June and December 15 $ 400.0 5.625 % June 15, 2025 April and October 15 $ 375.0 5.750 % January 15, 2026 March and September 15 US $ 600.0 5.125 % April 15, 2027 April and October 15 $ 800.0 4.500 % January 15, 2030 April and October 15 $ 650.0 1 3.125 % January 15, 2031 January and July 15 $ 750.0 2 3.625 % June 15, 2028 June and December 15 US $ 500.0 3 3.625 % June 15, 2029 June and December 15 1 The Notes were issued in January 2021 for net proceeds of $644.0 million, net of financing costs of $6.0 million. 2 The Notes were issued in June 2021 for net proceeds of $743.2 million, net of financing costs of $6.8 million. 3 The Notes were issued in June 2021 for net proceeds of $599.6 million, net of financing costs of $5.8 million. |
Schedule of principal repayments of long-term debt | 2022 $ — 2023 285.0 2024 758.2 2025 400.0 2026 375.0 2027 and thereafter 3,590.0 |
Schedule of changes in long-term debt | 2021 2020 Balance at beginning of year $ 4,111.5 $ 4,240.2 Net change under revolving facility, net of financing costs 285.0 (89.3) Issuance of long-term debt, net of financing costs 1,986.8 — Repayment of long-term debt, excluding early redemption premium (983.7) — Foreign currency translation (18.5) (52.9) Amortization of financing costs 6.1 5.8 Change in fair value related to hedged interest rate risk (8.5) 7.7 Other 1.4 — Balance at end of year $ 5,380.1 $ 4,111.5 |
LEASE LIABILITIES (Tables)
LEASE LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
LEASE LIABILITIES | |
Schedule of changes in lease liabilities | 2021 2020 Balance at beginning of year $ 142.3 $ 114.2 Lease obligations financing right-of-use assets 50.9 67.5 Repayments (39.4) (39.4) 153.8 142.3 Less current portion (35.0) (32.0) $ 118.8 $ 110.3 |
Schedule of repayments of lease liabilities over the coming years | 2022 $ 35.0 2023 32.4 2024 27.4 2025 19.6 2026 13.5 2027 and thereafter 25.9 |
OTHER LIABILITIES (Tables)
OTHER LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
OTHER LIABILITIES | |
Schedule of other liabilities | Note 2021 2020 Defined benefit plans 27 $ 90.2 $ 196.1 Decommissioning obligation 59.0 19.3 Other 39.1 37.2 $ 188.3 $ 252.6 |
CAPITAL STOCK (Tables)
CAPITAL STOCK (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
CAPITAL STOCK | |
Summary of issued and outstanding capital stock | Common shares Number Amount Balance as of December 31, 2019 10,711,165 $ 1,008.8 Issuance of common shares 7,162 6.8 Balance as of December 31, 2020 10,718,327 1,015.6 Reduction of paid-up capital — (720.0) Balance as of December 31, 2021 10,718,327 $ 295.6 |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
STOCK-BASED COMPENSATION PLANS | |
Schedule of weighted-average assumptions used to estimate the fair value of outstanding stock options | December 31, 2021 Ultimate parent corporation Risk-free interest rate 1.32 % Distribution yield 3.91 % Expected volatility 22.35 % Expected remaining life 3.7 years December 31, 2020 Ultimate parent Parent corporation corporation Risk-free interest rate 0.54 % 0.27 % Distribution yield 2.43 % 1.00 % Expected volatility 21.15 % 28.96 % Expected remaining life 4.6 years 1.0 year |
Ultimate parent corporation stock option plan | |
STOCK-BASED COMPENSATION PLANS | |
Schedule of information on changes to outstanding options | 2021 2020 Weighted Weighted average average Options exercise price Options exercise price Balance at beginning of year 1,467,700 $ 30.56 1,033,900 $ 29.19 Granted — — 555,000 33.19 Exercised (39,998) 26.52 — — Cancelled (883,768) 30.73 (121,200) 30.95 Balance at end of year 543,934 $ 30.58 1,467,700 $ 30.56 Vested options at end of year 51,864 $ 26.52 — $ — |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE LOSS ATTRIBUTABLE TO SHAREHOLDER (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
ACCUMULATED OTHER COMPREHENSIVE LOSS ATTRIBUTABLE TO SHAREHOLDER | |
Schedule of accumulated other comprehensive loss attributable to shareholder | Defined Cash flow hedges 1 benefit plans Total Balance as of December 31, 2018 $ (14.9) $ (47.1) $ (62.0) Other comprehensive income (loss) 47.9 (34.6) 13.3 Balance as of December 31, 2019 33.0 (81.7) (48.7) Other comprehensive loss (12.2) (44.8) (57.0) Balance as of December 31, 2020 20.8 (126.5) (105.7) Other comprehensive income 5.6 79.3 84.9 Balance as of December 31, 2021 $ 26.4 $ (47.2) $ (20.8) 1 No significant amount is expected to be reclassified in income over the next 12 months in connection with derivatives designated as cash flow hedges. The balance is expected to reverse over a 7 1/2 -year period. |
COMMITMENTS (Tables)
COMMITMENTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
COMMITMENTS | |
Schedule of minimum payments | 2022 $ 112.9 2023 to 2026 255.2 2027 and thereafter 146.4 |
FINANCIAL INSTRUMENTS AND FIN_2
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure of detailed information about financial instruments | |
Schedule of derivative financial instruments | CAN dollar average exchange rate per one U.S. Notional Notional Maturity dollar amount sold amount bought Less than 1 year 1.2578 $ 177.4 US$ 141.0 (ii) Cross-currency swaps Hedged item Hedging instrument CAN dollar Annual interest exchange rate on rate on notional interest and Period Notional amount in capital payments covered amount CAN dollars per one U.S. dollar 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 3.625% Senior Notes due 2029 2021 to 2029 US$ 500.0 4.04 % 1.2109 |
Schedule of carrying value and fair value of long-term debt and derivative financial instruments | 2021 2020 Carrying Fair Carrying Fair Asset (liability) value value value value Long-term debt 1 $ (5,408.2) $ (5,470.2) $ (4,120.0) $ (4,419.2) Derivative financial instruments 2 Foreign exchange forward contracts 0.9 0.9 (8.0) (8.0) Cross-currency swaps 116.3 116.3 333.3 333.3 1 The carrying value of long-term debt excludes changes in the fair value of long-term debt related to hedged interest rate risk and financing costs. 2 The net fair value of derivative financial instruments designated as cash flow hedges is an asset position of $83.0 million as of December 31, 2021 ($280.7 million in 2020) and the net fair value of derivative financial instruments designated as fair value hedges is an asset position of $34.2 million as of December 31, 2021 ($44.6 million in 2020). |
Schedule of changes to the provision for expected credit losses | 2021 2020 Balance at beginning of year $ 15.7 $ 14.3 Changes in expected credit losses charged to income 16.6 20.0 Write-off (17.9) (18.6) Balance at end of year $ 14.4 $ 15.7 |
Schedule of maturities of financial instruments included capital repayment and interest on long-term debt and obligations related to derivative instruments, less estimated future | Less than 5 years Total 1 year 1-3 years 3-5 years or more Accounts payable and accrued charges $ 559.2 $ 559.2 $ — $ — $ — Amounts payable to affiliated corporations 89.2 89.2 — — — Long-term debt 1 5,408.2 — 1,043.2 775.0 3,590.0 Interest payments on long-term debt 2 1,294.7 189.9 437.7 337.3 329.8 Lease liabilities 153.8 35.0 59.8 33.1 25.9 Interest payments on lease liabilities 19.8 5.9 7.8 3.8 2.3 Derivative financial instruments 3 (76.2) — (96.0) — 19.8 Total $ 7,448.7 $ 879.2 $ 1,452.5 $ 1,149.2 $ 3,967.8 1 The carrying value of long-term debt excludes changes in the fair value of long-term debt related to hedged interest rate risk and financing costs. 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, 2021. 3 Estimated future receipts, net of future disbursements, on derivative financial instruments related to foreign exchange hedging on the principal of U.S.-dollar-denominated debt . |
Schedule of capital structure | 2021 2020 Long-term debt $ 5,380.1 $ 4,111.5 Lease liabilities 153.8 142.3 Derivative financial instruments (117.2) (325.3) Cash and cash equivalents (10.5) (74.0) Promissory note to the parent corporation (160.0) (160.0) Net liabilities 5,246.2 3,694.5 Equity $ (338.3) $ 188.5 |
Foreign currency risk | |
Disclosure of detailed information about financial instruments | |
Schedule of estimated sensitivity on income and on other comprehensive income, before income tax | Other comprehensive Increase (decrease) Income income Increase of $0.10 $ 0.7 $ 31.0 Decrease of $0.10 (0.7) (31.0) |
Interest rate risk | |
Disclosure of detailed information about financial instruments | |
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 $ (0.7) $ (2.5) Decrease of 100 basis points 0.7 2.5 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
RELATED PARTY TRANSACTIONS | |
Schedule of key management personnel compensation | 2021 2020 2019 Salaries and short-term benefits $ 3.2 $ 5.6 $ 6.1 Share-based compensation (1.3) 1.2 3.9 Termination and other long-term benefits 0.9 0.3 0.3 $ 2.8 $ 7.1 $ 10.3 |
Schedule of transactions between related parties | 2021 2020 2019 Ultimate parent and parent corporation Revenues $ 0.4 $ 0.4 $ 0.5 Purchase of goods and services 10.2 9.6 9.9 Operating expenses recovered (2.3) (1.4) (2.6) Corporations under common control Revenues 5.3 4.9 5.5 Purchase of goods and services 109.7 95.7 123.2 Operating expenses recovered 0.4 1.4 (3.0) Other affiliated corporations Purchase of goods and services 10.6 5.6 2.1 Acquisition of property, plant and equipment and intangible assets 4.6 – – 2021 2020 Ultimate parent and parent corporation Accounts receivable $ 2.8 $ 2.8 Dividends receivable 5.0 5.0 Interest receivable 2.5 2.4 Corporations under common control Accounts receivable 7.5 2.5 $ 17.8 $ 12.7 2021 2020 Ultimate parent and parent corporation Accounts payable $ 21.2 $ 33.9 Interest payable 5.0 5.0 Corporations under common control Accounts payable 63.0 29.0 $ 89.2 67.9 |
Schedule of tax consolidation transactions | 2021 2020 Investment in an affiliated corporation 1 $ 1,595.0 $ 1,595.0 Subordinated loan from the parent corporation 2 (1,595.0) (1,595.0) 1 Investment in 1,595,000 preferred shares, Series C, of 9346-9963 Quebec Inc., a subsidiary of Quebecor Media Inc., carrying the right to receive an annual dividend of 9.6%, payable semi-annually. 2 Subordinated loan of $1,595.0 million from Quebecor Media Inc., bearing interest at a rate of 9.5%, payable semi-annually, and maturing on February 27, 2048. |
PENSION PLANS AND POSTRETIREM_2
PENSION PLANS AND POSTRETIREMENT BENEFITS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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 2021 2020 2021 2020 Change in benefit obligations Benefit obligations at the beginning of the year $ 686.4 $ 570.4 $ 46.0 $ 40.9 Service costs 27.0 26.1 1.7 1.6 Interest costs 18.9 17.8 1.2 1.2 Plan participants’ contributions 5.4 6.2 — — Actuarial (gain) loss arising from: Financial assumptions (74.6) 82.7 (5.5) 6.3 Demographic assumptions 11.3 — — — Participant experience 3.3 (0.6) — — Benefits and settlements paid (19.7) (17.2) (0.7) (0.8) Plan amendments and other 1.0 1.0 (3.8) (3.2) Benefit obligations at the end of the year $ 659.0 $ 686.4 $ 38.9 $ 46.0 Pension benefits Postretirement benefits 2021 2020 2021 2020 Change in plan assets Fair value of plan assets at the beginning of the year $ 536.3 $ 485.8 $ — $ — Actual return on plan assets 57.0 43.1 — — Employer contributions 29.3 19.0 0.7 0.8 Plan participants’ contributions 5.4 6.2 — — Benefits and settlements paid (19.7) (17.2) (0.7) (0.8) Administrative fees (0.6) (0.6) — — Fair value of plan assets at the end of the year $ 607.7 $ 536.3 $ — $ — |
Schedule of fair value of plan assets | 2021 2020 Equity securities: Canadian 21.0 % 21.9 % Foreign 30.2 30.8 Debt securities 39.5 39.8 Other 9.3 7.5 100.0 % 100.0 % |
Schedule of reconciliation of funded status to the net amount | Pension benefits Postretirement benefits 2021 2020 2021 2020 Benefit obligations $ (659.0) $ (686.4) $ (38.9) $ (46.0) Fair value of plan assets 607.7 536.3 — — Plan deficit and net amount recognized 1 $ (51.3) $ (150.1) $ (38.9) $ (46.0) 1 The net liability recognized for 2021 is $90.2 million ($196.1 million in 2020) and is included in “Other liabilities” (note 18). |
Schedule of components of re-measurements | Pension benefits Postretirement benefits 2021 2020 2019 2021 2020 2019 Actuarial gain (loss) on benefit obligations $ 60.0 $ (82.1) $ (75.5) $ 5.5 $ (6.3) $ (10.8) Actual return on plan assets, less interest income anticipated in the interest on the net defined benefit liability calculation 42.4 27.4 39.0 — — — Re-measurement gain (loss) recorded in other comprehensive income (loss) $ 102.4 $ (54.7) $ (36.5) $ 5.5 $ (6.3) $ (10.8) |
Schedule of components of net benefit costs | Pension benefits Postretirement benefits 2021 2020 2019 2021 2020 2019 Employee costs: Service costs $ 27.0 $ 26.1 $ 21.0 $ 1.7 $ 1.6 $ 2.1 Plan amendments, administrative fees and other 0.5 0.6 0.7 (3.8) (3.2) (23.3) Interest on net defined benefit liability 4.2 3.2 2.5 1.2 1.2 1.8 Net benefit costs (gain) $ 31.7 $ 29.9 $ 24.2 $ (0.9) $ (0.4) $ (19.4) |
Schedule of actuarial assumptions used in measuring the Corporation's benefit obligations | Pension and postretirement benefits 2021 2020 2019 Benefit obligations Rates as of year-end: Discount rate 3.00 % 2.50 % 3.10 % Rate of compensation increase 3.00 3.00 3.00 Current periodic costs Rates as of preceding year-end: Discount rate 2.50 % 3.10 % 3.90 % Rate of compensation increase 3.00 3.00 3.00 |
OTHER EXPLANATORY INFORMATION_2
OTHER EXPLANATORY INFORMATION (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Videotron Infrastructures Inc | |
Percentages of voting rights and equity in its major subsidiaries | |
% equity and voting | 100.00% |
Videotron US Inc | |
Percentages of voting rights and equity in its major subsidiaries | |
% equity and voting | 100.00% |
Teledistribution Amos inc. | |
Percentages of voting rights and equity in its major subsidiaries | |
% equity and voting | 100.00% |
SETTE Inc | |
Percentages of voting rights and equity in its major subsidiaries | |
% equity and voting | 84.53% |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Estimated useful lives of fixed assets (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Buildings and leasehold improvements | Minimum | |
FIXED ASSETS | |
Estimated useful lives of fixed assets | 5 years |
Buildings and leasehold improvements | Maximum | |
FIXED ASSETS | |
Estimated useful lives of fixed assets | 40 years |
Furniture and equipment | Minimum | |
FIXED ASSETS | |
Estimated useful lives of fixed assets | 3 years |
Furniture and equipment | Maximum | |
FIXED ASSETS | |
Estimated useful lives of fixed assets | 7 years |
Telecommunication networks | Minimum | |
FIXED ASSETS | |
Estimated useful lives of fixed assets | 3 years |
Telecommunication networks | Maximum | |
FIXED ASSETS | |
Estimated useful lives of fixed assets | 20 years |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Estimated useful lives of intangible assets (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Minimum | Software | |
INTANGIBLE ASSETS | |
Estimated useful lives of intangible assets | 3 years |
Minimum | Customer relationships and other | |
INTANGIBLE ASSETS | |
Estimated useful lives of intangible assets | 5 years |
Maximum | Software | |
INTANGIBLE ASSETS | |
Estimated useful lives of intangible assets | 7 years |
Maximum | Customer relationships and other | |
INTANGIBLE ASSETS | |
Estimated useful lives of intangible assets | 8 years |
EMPLOYEE COSTS AND PURCHASE O_3
EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
EMPLOYEE COSTS AND PURCHASE OF GOODS AND SERVICES | |||
Employee costs | $ 574.3 | $ 595.5 | $ 605.2 |
Less employee costs capitalized to property, plant and equipment and intangible assets | (168.4) | (191.7) | (206.6) |
Total employee costs | 405.9 | 403.8 | 398.6 |
Purchase of goods and services: | |||
Royalties and rights | 401 | 403.9 | 397.8 |
Cost of product sold | 497.3 | 444.6 | 368.6 |
Subcontracting costs | 147.7 | 148.8 | 102.4 |
Marketing and distribution expenses | 61.3 | 56 | 68.6 |
Other | 346.1 | 301 | 337.3 |
Purchase of goods and services | 1,453.4 | 1,354.3 | 1,274.7 |
Total employee costs and purchase of goods and services | 1,859.3 | 1,758.1 | 1,673.3 |
Cost of inventories recognised as expense during period | 435.5 | 378.5 | 299.3 |
Inventory write-down | $ 2 | $ 1.7 | $ 3.1 |
FINANCIAL EXPENSES (Details)
FINANCIAL EXPENSES (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Third parties: | |||
Interest on long-term debt | $ 228 | $ 204.3 | $ 195.8 |
Amortization of financing costs | 6.1 | 5.8 | 5.1 |
Interest on lease liabilities | 5.4 | 4.9 | 4.6 |
Interest on net defined benefit liability | 5.4 | 4.4 | 4.3 |
Gain on foreign currency translation of short-term monetary items | (1.1) | (2.1) | (2) |
Other | (3.7) | (0.9) | (0.1) |
Total third parties | 240.1 | 216.4 | 207.7 |
Affiliated corporations: | |||
Interest expense | 175.5 | 167 | 207.3 |
Dividend income | (177.4) | (168.8) | (209.5) |
Interest on lease liabilities | 1.7 | 1.8 | 2 |
Interest income | (7.8) | (7.9) | (7.5) |
Total affiliated corporations | (8) | (7.9) | (7.7) |
Total financial expenses | $ 232.1 | $ 208.5 | $ 200 |
RESTRUCTURING OF OPERATIONS A_2
RESTRUCTURING OF OPERATIONS AND OTHER ITEMS (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
RESTRUCTURING OF OPERATIONS AND OTHER ITEMS | |||
Restructuring of operations | $ 10.8 | $ 21 | $ 4.9 |
Impairment charge on assets | $ 0.8 | $ 8.4 | $ 15.3 |
LOSS ON DEBT REFINANCING (Detai
LOSS ON DEBT REFINANCING (Details) $ in Millions, $ in Millions | Jun. 03, 2021CAD ($) | Jul. 31, 2021CAD ($) | Dec. 31, 2021CAD ($) | Jun. 03, 2021USD ($) |
Long-term debt | ||||
Loss on debt refinancing | $ 40.1 | |||
Gain from hedging contracts | $ 1 | |||
Senior Note 5.000% July 2022 | ||||
Long-term debt | ||||
Principal amount | $ 800 | |||
Annual nominal interest rate (in percentage) | 5.00% | |||
Percentage of principal amount redeemed | 104.002% | |||
Loss on debt refinancing | $ 40.1 | |||
Gain from hedging contracts | $ 1 | |||
Cash consideration of redemption of senior notes and related hedging contracts | $ 838.1 |
INCOME TAXES - Reconciliation o
INCOME TAXES - Reconciliation of income tax expense (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
INCOME TAXES | |||
Domestic statutory tax rate (in percent) | 26.50% | 26.50% | 26.60% |
Income taxes at domestic statutory tax rate | $ 231.5 | $ 233.6 | $ 238.5 |
(Reduction) increase resulting from: | |||
Non-deductible charges, non-taxable income and differences between current and future tax rates | (5.7) | (1.5) | (3.7) |
Tax consolidation transactions (note 26) | (47) | (44.7) | (55.7) |
Other | 1.5 | 0.5 | |
Income taxes | $ 180.3 | $ 187.9 | $ 179.1 |
INCOME TAXES - Components of de
INCOME TAXES - Components of deferred income tax (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Deferred income taxes | |||
Deferred tax liability, net | $ (762.7) | $ (790.6) | $ (809.5) |
Deferred tax expense (income) | (55.2) | (0.6) | 84.2 |
Defined benefit plans | |||
Deferred income taxes | |||
Deferred tax liability, net | 23.9 | 50.2 | |
Deferred tax expense (income) | (2.3) | (2.5) | 5.2 |
Contract assets. | |||
Deferred income taxes | |||
Deferred tax liability, net | (41.2) | (65.5) | |
Deferred tax expense (income) | (24.3) | 6.7 | 4.5 |
Property, plant and equipment | |||
Deferred income taxes | |||
Deferred tax liability, net | (435.5) | (459.9) | |
Deferred tax expense (income) | (24.4) | (15.7) | 9.2 |
Goodwill, intangible assets and other assets | |||
Deferred income taxes | |||
Deferred tax liability, net | (327.6) | (319.5) | |
Deferred tax expense (income) | 7.4 | 11.7 | 67 |
Long-term debt and derivative financial instruments | |||
Deferred income taxes | |||
Deferred tax liability, net | (7.1) | (15.2) | |
Deferred tax expense (income) | (6.1) | 0.6 | 1.1 |
Other | |||
Deferred income taxes | |||
Deferred tax liability, net | 24.8 | 19.3 | |
Deferred tax expense (income) | $ (5.5) | $ (1.4) | $ (2.8) |
INCOME TAXES - Changes in defer
INCOME TAXES - Changes in deferred income tax liability (Details) - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Changes in the net deferred income tax liability | ||
Balance at beginning of year | $ (790.6) | $ (809.5) |
Recognized in income as continuing operations | 55.2 | 0.6 |
Recognized in other comprehensive income | (26.6) | 21.1 |
Business acquisition | (0.7) | (2.8) |
Balance at end of year | $ (762.7) | $ (790.6) |
BUSINESS ACQUISITIONS (Details)
BUSINESS ACQUISITIONS (Details) - CAD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
BUSINESS ACQUISITIONS | ||
Cash consideration | $ 6.7 | |
Businesses | ||
BUSINESS ACQUISITIONS | ||
Cash acquired | $ 0.1 | |
Teledistribution Amos inc | ||
BUSINESS ACQUISITIONS | ||
Cash consideration | $ 32.9 |
RESTRICTED CASH AND DEFERRED _2
RESTRICTED CASH AND DEFERRED SUBSIDIES (Details) $ in Millions | Mar. 22, 2021CAD ($)item | Dec. 31, 2021CAD ($) |
RESTRICTED CASH AND DEFERRED SUBSIDIES | ||
Internet connectivity number of additional households | item | 37,000 | |
Government grants for network expansion | $ 258 | |
Government grants received in advance | $ 216.2 | |
Deferred subsidies recognized as reductions to property, plant, and equipment | $ 53.8 |
ACCOUNTS RECEIVABLE (Details)
ACCOUNTS RECEIVABLE (Details) - CAD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
ACCOUNTS RECEIVABLE | ||
Trade | $ 479.3 | $ 338.7 |
Other | 51.1 | 19.7 |
Total | $ 530.4 | $ 358.4 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Changes in the net carrying amount of fixed assets | |||
Balance at the beginning of period | $ 2,879.5 | ||
Depreciation | 542.4 | $ 586.8 | $ 558.1 |
Balance at the end of period | 2,761.6 | 2,879.5 | |
Increase in depreciation | 24 | ||
Cost | |||
Changes in the net carrying amount of fixed assets | |||
Balance at the beginning of period | 8,410.6 | 8,388.7 | |
Additions | 407.2 | 429.2 | |
Net change in additions financed with non-cash balances | (13.3) | (63.2) | |
Decommissioning obligation | 37.1 | ||
Retirement, disposals and other | 287.8 | 344.1 | |
Balance at the end of period | 8,553.8 | 8,410.6 | 8,388.7 |
Accumulated depreciation and impairment losses | |||
Changes in the net carrying amount of fixed assets | |||
Balance at the beginning of period | (5,531.1) | (5,288.6) | |
Depreciation | 542.4 | 586.8 | |
Retirement, disposals and other | (281.3) | (344.3) | |
Balance at the end of period | (5,792.2) | (5,531.1) | (5,288.6) |
Land, buildings and leasehold improvements | |||
Changes in the net carrying amount of fixed assets | |||
Balance at the beginning of period | 148 | ||
Balance at the end of period | 138.8 | 148 | |
Land, buildings and leasehold improvements | Cost | |||
Changes in the net carrying amount of fixed assets | |||
Balance at the beginning of period | 242 | 232.4 | |
Additions | 5.9 | 8.5 | |
Net change in additions financed with non-cash balances | (0.1) | ||
Reclassification | (8.4) | ||
Retirement, disposals and other | 5.7 | (1.2) | |
Balance at the end of period | 233.8 | 242 | 232.4 |
Land, buildings and leasehold improvements | Accumulated depreciation and impairment losses | |||
Changes in the net carrying amount of fixed assets | |||
Balance at the beginning of period | (94) | (86.9) | |
Depreciation | 6.9 | 7.1 | |
Retirement, disposals and other | (5.9) | ||
Balance at the end of period | (95) | (94) | (86.9) |
Furniture and equipment | |||
Changes in the net carrying amount of fixed assets | |||
Balance at the beginning of period | 282.2 | ||
Balance at the end of period | 232.8 | 282.2 | |
Furniture and equipment | Cost | |||
Changes in the net carrying amount of fixed assets | |||
Balance at the beginning of period | 1,563.1 | 1,681.1 | |
Additions | 49 | 56.6 | |
Net change in additions financed with non-cash balances | (0.4) | 1.5 | |
Reclassification | 8 | (59.6) | |
Retirement, disposals and other | 236.7 | 116.5 | |
Balance at the end of period | 1,383 | 1,563.1 | 1,681.1 |
Furniture and equipment | Accumulated depreciation and impairment losses | |||
Changes in the net carrying amount of fixed assets | |||
Balance at the beginning of period | (1,280.9) | (1,269.7) | |
Depreciation | 99.4 | 124.9 | |
Retirement, disposals and other | (230.1) | (113.7) | |
Balance at the end of period | (1,150.2) | (1,280.9) | (1,269.7) |
Telecommunication networks | |||
Changes in the net carrying amount of fixed assets | |||
Balance at the beginning of period | 2,362.2 | ||
Balance at the end of period | 2,294.2 | 2,362.2 | |
Telecommunication networks | Cost | |||
Changes in the net carrying amount of fixed assets | |||
Balance at the beginning of period | 6,518.4 | 6,389.4 | |
Additions | 178.6 | 230.3 | |
Net change in additions financed with non-cash balances | (1.1) | (57.1) | |
Decommissioning obligation | 37.1 | ||
Reclassification | 153.6 | 184.6 | |
Retirement, disposals and other | 45.4 | 228.8 | |
Balance at the end of period | 6,841.2 | 6,518.4 | 6,389.4 |
Telecommunication networks | Accumulated depreciation and impairment losses | |||
Changes in the net carrying amount of fixed assets | |||
Balance at the beginning of period | (4,156.2) | (3,932) | |
Depreciation | 436.1 | 454.8 | |
Retirement, disposals and other | (45.3) | (230.6) | |
Balance at the end of period | (4,547) | (4,156.2) | (3,932) |
Projects under development. | |||
Changes in the net carrying amount of fixed assets | |||
Balance at the beginning of period | 87.1 | ||
Balance at the end of period | 95.8 | 87.1 | |
Projects under development. | Cost | |||
Changes in the net carrying amount of fixed assets | |||
Balance at the beginning of period | 87.1 | 85.8 | |
Additions | 173.7 | 133.8 | |
Net change in additions financed with non-cash balances | (11.8) | (7.5) | |
Reclassification | (153.2) | (125) | |
Balance at the end of period | $ 95.8 | $ 87.1 | $ 85.8 |
INTANGIBLE ASSETS - Summary (De
INTANGIBLE ASSETS - Summary (Details) $ in Millions | Dec. 17, 2021CAD ($) | Sep. 30, 2021CAD ($) | Dec. 31, 2021CAD ($)item | Dec. 31, 2020CAD ($) | Dec. 31, 2019CAD ($) |
Changes in the net carrying amount of intangible assets | |||||
Balance at the beginning of the period | $ 1,351.4 | ||||
Balance at the end of the period | 2,212 | $ 1,351.4 | |||
Amount of payments to acquire intangible assets | 986.1 | 180.2 | $ 468.1 | ||
Internally Generated | |||||
Changes in the net carrying amount of intangible assets | |||||
Balance at the beginning of the period | 243.1 | ||||
Balance at the end of the period | 350.3 | 243.1 | |||
Cost | |||||
Changes in the net carrying amount of intangible assets | |||||
Balance at the beginning of the period | 2,378.6 | 2,260.4 | |||
Additions | 986.1 | 180.2 | |||
Business acquisitions | 2.3 | 9.8 | |||
Net change in additions financed with non-cash balances | 8.9 | (52.7) | |||
Retirement, disposals and other | (15.2) | (19.1) | |||
Balance at the end of the period | 3,360.7 | 2,378.6 | 2,260.4 | ||
Cost | Internally Generated | |||||
Changes in the net carrying amount of intangible assets | |||||
Additions | 154.2 | 73.1 | 40.1 | ||
Accumulated amortization and impairment losses | |||||
Changes in the net carrying amount of intangible assets | |||||
Balance at the beginning of the period | (1,027.2) | (923.7) | |||
Amortization | 136.7 | 122.6 | |||
Retirement, disposals and other | 15.2 | 19.1 | |||
Balance at the end of the period | (1,148.7) | (1,027.2) | (923.7) | ||
Accumulated depreciation and amortisation | Internally Generated | |||||
Changes in the net carrying amount of intangible assets | |||||
Amortization | 46.9 | 44 | 39.5 | ||
Spectrum licences | |||||
Changes in the net carrying amount of intangible assets | |||||
Balance at the beginning of the period | 731.6 | ||||
Balance at the end of the period | $ 1,561.6 | 731.6 | |||
Number of blocks acquired | item | 294 | ||||
Amount of payments to acquire intangible assets | $ 664 | $ 166 | |||
Spectrum licences | Cost | |||||
Changes in the net carrying amount of intangible assets | |||||
Balance at the beginning of the period | $ 979.3 | 979.3 | |||
Additions | 830 | ||||
Balance at the end of the period | 1,809.3 | 979.3 | 979.3 | ||
Spectrum licences | Accumulated amortization and impairment losses | |||||
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) | ||
Software | |||||
Changes in the net carrying amount of intangible assets | |||||
Balance at the beginning of the period | 496.3 | ||||
Balance at the end of the period | 449 | 496.3 | |||
Software | Cost | |||||
Changes in the net carrying amount of intangible assets | |||||
Balance at the beginning of the period | 1,268.4 | 1,180.6 | |||
Additions | 87.6 | 122 | |||
Business acquisitions | 0.1 | ||||
Net change in additions financed with non-cash balances | (36.2) | (114.9) | |||
Reclassification | 34.5 | 99.7 | |||
Retirement, disposals and other | (15.2) | (19.1) | |||
Balance at the end of the period | 1,339.1 | 1,268.4 | 1,180.6 | ||
Software | Cost | Internally Generated | |||||
Changes in the net carrying amount of intangible assets | |||||
Balance at the beginning of the period | 631.5 | ||||
Balance at the end of the period | 773.2 | 631.5 | |||
Software | Accumulated amortization and impairment losses | |||||
Changes in the net carrying amount of intangible assets | |||||
Balance at the beginning of the period | (772.1) | (670.9) | |||
Amortization | 133.2 | 120.3 | |||
Retirement, disposals and other | 15.2 | 19.1 | |||
Balance at the end of the period | (890.1) | (772.1) | (670.9) | ||
Software | Accumulated amortization and impairment losses | Internally Generated | |||||
Changes in the net carrying amount of intangible assets | |||||
Balance at the beginning of the period | (388.4) | ||||
Balance at the end of the period | (422.9) | (388.4) | |||
Customer relationships, projects development and other | |||||
Changes in the net carrying amount of intangible assets | |||||
Balance at the beginning of the period | 123.5 | ||||
Balance at the end of the period | 201.4 | 123.5 | |||
Customer relationships, projects development and other | Cost | |||||
Changes in the net carrying amount of intangible assets | |||||
Balance at the beginning of the period | 130.9 | 100.5 | |||
Additions | 68.5 | 58.2 | |||
Business acquisitions | 2.3 | 9.7 | |||
Net change in additions financed with non-cash balances | 45.1 | 62.2 | |||
Reclassification | (34.5) | (99.7) | |||
Balance at the end of the period | 212.3 | 130.9 | 100.5 | ||
Customer relationships, projects development and other | Accumulated amortization and impairment losses | |||||
Changes in the net carrying amount of intangible assets | |||||
Balance at the beginning of the period | (7.4) | (5.1) | |||
Amortization | 3.5 | 2.3 | |||
Balance at the end of the period | $ (10.9) | $ (7.4) | $ (5.1) |
INTANGIBLE ASSETS - Other discl
INTANGIBLE ASSETS - Other disclosures (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
INTANGIBLE ASSETS | |||
Intangible assets | $ 2,212 | $ 1,351.4 | |
Intangible assets with indefinite useful life | 1,562.8 | 732.8 | |
Cost | |||
INTANGIBLE ASSETS | |||
Intangible assets | 3,360.7 | 2,378.6 | $ 2,260.4 |
Additions | 986.1 | 180.2 | |
Accumulated amortization and impairment losses | |||
INTANGIBLE ASSETS | |||
Intangible assets | (1,148.7) | (1,027.2) | (923.7) |
Amortization | 136.7 | 122.6 | |
Internally Generated | |||
INTANGIBLE ASSETS | |||
Intangible assets | 350.3 | 243.1 | |
Internally Generated | Cost | |||
INTANGIBLE ASSETS | |||
Additions | 154.2 | 73.1 | 40.1 |
Internally Generated | Amortization | |||
INTANGIBLE ASSETS | |||
Amortization | 46.9 | 44 | 39.5 |
Software | |||
INTANGIBLE ASSETS | |||
Intangible assets | 449 | 496.3 | |
Software | Cost | |||
INTANGIBLE ASSETS | |||
Intangible assets | 1,339.1 | 1,268.4 | 1,180.6 |
Additions | 87.6 | 122 | |
Software | Accumulated amortization and impairment losses | |||
INTANGIBLE ASSETS | |||
Intangible assets | (890.1) | (772.1) | $ (670.9) |
Amortization | 133.2 | 120.3 | |
Software | Internally Generated | Cost | |||
INTANGIBLE ASSETS | |||
Intangible assets | 773.2 | 631.5 | |
Software | Internally Generated | Accumulated amortization and impairment losses | |||
INTANGIBLE ASSETS | |||
Intangible assets | $ (422.9) | $ (388.4) |
RIGHT-OF-USE ASSETS - Roll forw
RIGHT-OF-USE ASSETS - Roll forward (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
RIGHT-OF-USE ASSETS | |||
Balance at beginning of year | $ 111.3 | ||
Depreciation | 38.7 | $ 34.4 | $ 32.5 |
Balance at end of year | 122.9 | 111.3 | |
Cost | |||
RIGHT-OF-USE ASSETS | |||
Balance at beginning of year | 319.3 | 271.6 | |
Additions financed with lease obligations | 50.9 | 67.5 | |
Retirement and other | (17.4) | (19.8) | |
Balance at end of year | 352.8 | 319.3 | 271.6 |
Accumulated depreciation | |||
RIGHT-OF-USE ASSETS | |||
Balance at beginning of year | (208) | (186.1) | |
Depreciation | (38.7) | (34.4) | |
Retirement and other | 16.8 | 12.5 | |
Balance at end of year | $ (229.9) | $ (208) | $ (186.1) |
RIGHT-OF-USE ASSETS - Additiona
RIGHT-OF-USE ASSETS - Additional information (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
RIGHT-OF-USE ASSETS | |||
Right-of-use assets. | $ 122.9 | $ 111.3 | |
Depreciation | 38.7 | 34.4 | $ 32.5 |
Parent | |||
RIGHT-OF-USE ASSETS | |||
Right-of-use assets. | 17.5 | 15.3 | |
Depreciation | $ 3.9 | $ 3.8 |
GOODWILL - Changes in the net c
GOODWILL - Changes in the net carrying amount of goodwill (Details) - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Changes in the net carrying amount of goodwill | ||
Balance at beginning of year | $ 538.1 | |
Balance at end of year | 542.6 | $ 538.1 |
Cost | ||
Changes in the net carrying amount of goodwill | ||
Balance at beginning of year | 606.6 | 583.5 |
Business acquisition | 4.5 | 23.1 |
Balance at end of year | 611.1 | 606.6 |
Accumulated impairment losses | ||
Changes in the net carrying amount of goodwill | ||
Balance at beginning of year | (68.5) | |
Balance at end of year | $ (68.5) | $ (68.5) |
GOODWILL - Determination of rec
GOODWILL - Determination of recoverable amounts in the impairment tests performed in significant CGU groups (Details) - Telecommunications | Dec. 31, 2021 | Dec. 31, 2020 |
Goodwill | ||
Percentage of pre-tax discount rate (WACC) | 8.50% | 8.50% |
Perpetual growth rate | 2.00% | 2.00% |
OTHER ASSETS - Tabular disclosu
OTHER ASSETS - Tabular disclosure (Details) - CAD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
OTHER ASSETS | ||
Contract assets | $ 155.6 | $ 247 |
Contract costs | 174.8 | 148.2 |
Equipment installments receivable | 358.6 | 148.6 |
Other | 17.1 | 89.9 |
Other assets | $ 706.1 | $ 633.7 |
OTHER ASSETS - Other noncurrent
OTHER ASSETS - Other noncurrent assets (Details) - CAD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
OTHER ASSETS | ||
Other assets | $ 706.1 | $ 633.7 |
Less current portion of contract assets | (129.4) | (174.9) |
Less current portion of contract costs (included in "Other current assets") | (68.5) | (59.9) |
Less current portion of equipment installments receivable (included in "Accounts receivable") | (256.9) | (111.6) |
Total other assets | $ 251.3 | $ 287.3 |
OTHER ASSETS - Additional infor
OTHER ASSETS - Additional information (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
OTHER ASSETS | |||
Impairment loss on contract assets | $ 17.1 | $ 20.5 | $ 19.7 |
Amortization of contract costs | $ 73.3 | $ 65.9 | $ 63.6 |
ACCOUNTS PAYABLE, ACCRUED CHA_3
ACCOUNTS PAYABLE, ACCRUED CHARGES AND PROVISIONS (Details) - CAD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
ACCOUNTS PAYABLE, ACCRUED CHARGES AND PROVISIONS | ||
Trade and accruals | $ 448.2 | $ 458.3 |
Salaries and employee benefits | 67.8 | 82.7 |
Interest payable | 42.7 | 52.4 |
Provisions and other | 9.7 | 14.6 |
Total | $ 568.4 | $ 608 |
LONG-TERM DEBT - Breakdown of l
LONG-TERM DEBT - Breakdown of long-term debt (Details) $ in Millions, $ in Millions | Dec. 31, 2021CAD ($) | Dec. 31, 2021USD ($) | Dec. 31, 2020CAD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019CAD ($) |
Long-term debt | |||||
Total long-term debt | $ 5,408.2 | $ 2,156.6 | $ 4,120 | $ 2,561.8 | |
Change in fair value related to hedged interest rate risk | 8.3 | 16.8 | |||
Financing costs, net of amortization | (36.4) | (25.3) | |||
Total long-term debt, current and non current | $ 5,380.1 | 4,111.5 | $ 4,240.2 | ||
Bank credit facilities | |||||
Long-term debt | |||||
Borrowings, interest rate | 1.90% | 1.90% | |||
Total long-term debt | $ 285 | ||||
Senior Notes | |||||
Long-term debt | |||||
Total long-term debt | $ 5,123.2 | $ 4,120 |
LONG-TERM DEBT - Bank credit fa
LONG-TERM DEBT - Bank credit facilities (Details) $ in Millions, $ in Millions | Dec. 31, 2021CAD ($) | Dec. 31, 2021USD ($) | Dec. 31, 2020CAD ($) | Dec. 31, 2020USD ($) |
Long-term debt | ||||
Long-term debt | $ 5,408.2 | $ 2,156.6 | $ 4,120 | $ 2,561.8 |
Fair value of related hedging derivative instruments was in an asset position | $ 116.3 | $ 333.3 | ||
Assets carrying value | 8,905.8 | 8,119.6 | ||
Bank credit facilities | ||||
Long-term debt | ||||
Long-term debt | 285 | |||
Assets carrying value | 8,900.3 | 8,114 | ||
Secured revolving credit facility | ||||
Long-term debt | ||||
Drawn credit facility | 285 | $ 0 | ||
Secured revolving credit facility matures in July 2023 | ||||
Long-term debt | ||||
Principal amount | $ 1,500 |
LONG-TERM DEBT - Senior notes (
LONG-TERM DEBT - Senior notes (Details) $ in Millions, $ in Millions | 1 Months Ended | 12 Months Ended | |||||
Jun. 30, 2021CAD ($) | Jun. 30, 2021USD ($) | Jan. 31, 2021CAD ($) | Dec. 31, 2021CAD ($) | Dec. 31, 2019CAD ($) | Dec. 31, 2021USD ($) | Jun. 03, 2021USD ($) | |
Long-term debt | |||||||
Senior notes redeemable period by issuer | 5 years | ||||||
Net proceeds from issuance of senior notes | $ 1,986.8 | $ 790.7 | |||||
Senior Note 5.000% July 2022 | |||||||
Long-term debt | |||||||
Principal amount | $ 800 | ||||||
Annual nominal interest rate (in percentage) | 5.00% | ||||||
Senior Note 5.375% June 2024 | |||||||
Long-term debt | |||||||
Principal amount | $ 600 | ||||||
Annual nominal interest rate (in percentage) | 5.375% | 5.375% | |||||
Senior Note 5.625% June 2025 | |||||||
Long-term debt | |||||||
Principal amount | $ 400 | ||||||
Annual nominal interest rate (in percentage) | 5.625% | 5.625% | |||||
Senior Note 5.750% January 2026 | |||||||
Long-term debt | |||||||
Principal amount | $ 375 | ||||||
Annual nominal interest rate (in percentage) | 5.75% | 5.75% | |||||
5.125% Senior Notes due 2027 | |||||||
Long-term debt | |||||||
Principal amount | $ 600 | ||||||
Annual nominal interest rate (in percentage) | 5.125% | 5.125% | |||||
Senior Note 4.500% January 2030 | |||||||
Long-term debt | |||||||
Principal amount | $ 800 | ||||||
Annual nominal interest rate (in percentage) | 4.50% | 4.50% | |||||
Senior Note 3.125% January 2031 | |||||||
Long-term debt | |||||||
Principal amount | $ 650 | ||||||
Annual nominal interest rate (in percentage) | 3.125% | 3.125% | |||||
Net proceeds from issuance of senior notes | $ 644 | ||||||
Financing costs | $ 6 | ||||||
Senior Note 3.625% June 2028 | |||||||
Long-term debt | |||||||
Principal amount | $ 750 | ||||||
Annual nominal interest rate (in percentage) | 3.625% | 3.625% | |||||
Net proceeds from issuance of senior notes | $ 743.2 | ||||||
Financing costs | $ 6.8 | ||||||
Senior Note 3.625% June 2029 | |||||||
Long-term debt | |||||||
Principal amount | $ 500 | ||||||
Annual nominal interest rate (in percentage) | 3.625% | 3.625% | |||||
Net proceeds from issuance of senior notes | $ 599.6 | ||||||
Financing costs | $ 5.8 |
LONG-TERM DEBT - Principal repa
LONG-TERM DEBT - Principal repayments of long-term debt (Details) $ in Millions | Dec. 31, 2021CAD ($) |
2023 | |
Principal repayments of long-term debt | |
Principal repayments | $ 285 |
2024 | |
Principal repayments of long-term debt | |
Principal repayments | 758.2 |
2025 | |
Principal repayments of long-term debt | |
Principal repayments | 400 |
2026 | |
Principal repayments of long-term debt | |
Principal repayments | 375 |
2027 and thereafter | |
Principal repayments of long-term debt | |
Principal repayments | $ 3,590 |
LONG-TERM DEBT - Changes in lon
LONG-TERM DEBT - Changes in long-term debt (Details) - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
LONG-TERM DEBT | ||
Balance at beginning of year | $ 4,111.5 | $ 4,240.2 |
Net change under revolving facility, net of financing costs | 285 | (89.3) |
Issuance of long-term debt, net of financing costs | 1,986.8 | |
Repayment of long-term debt, excluding early redemption premium | (983.7) | |
Foreign currency translation | (18.5) | (52.9) |
Amortization of financing costs | 6.1 | 5.8 |
Change in fair value related to hedged interest rate risk | (8.5) | 7.7 |
Other | 1.4 | |
Balance at end of year | $ 5,380.1 | $ 4,111.5 |
LEASE LIABILITIES - Roll forwar
LEASE LIABILITIES - Roll forward (Details) - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
LEASE LIABILITIES | ||
Balance at beginning of year | $ 142.3 | $ 114.2 |
Lease obligations financing right-of-use assets | 50.9 | 67.5 |
Repayments | (39.4) | (39.4) |
Balance at end of year | 153.8 | 142.3 |
Less current portion | (35) | (32) |
Lease liabilities | $ 118.8 | $ 110.3 |
LEASE LIABILITIES - Additional
LEASE LIABILITIES - Additional information (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
LEASE LIABILITIES | |||
Lease liabilities | $ 153.8 | $ 142.3 | $ 114.2 |
Minimum | |||
LEASE LIABILITIES | |||
Interest rates on lease liabilities (as a percent) | 1.90% | 1.90% | |
Maximum | |||
LEASE LIABILITIES | |||
Interest rates on lease liabilities (as a percent) | 8.50% | 8.50% | |
Affiliated | |||
LEASE LIABILITIES | |||
Lease liabilities | $ 25.9 | $ 26.3 |
LEASE LIABILITIES - Repayments
LEASE LIABILITIES - Repayments of lease liabilities (Details) $ in Millions | Dec. 31, 2021CAD ($) |
2022 | |
LEASE LIABILITIES | |
Undiscounted lease payments to be made | $ 35 |
2023 | |
LEASE LIABILITIES | |
Undiscounted lease payments to be made | 32.4 |
2024 | |
LEASE LIABILITIES | |
Undiscounted lease payments to be made | 27.4 |
2025 | |
LEASE LIABILITIES | |
Undiscounted lease payments to be made | 19.6 |
2026 | |
LEASE LIABILITIES | |
Undiscounted lease payments to be made | 13.5 |
2027 and thereafter | |
LEASE LIABILITIES | |
Undiscounted lease payments to be made | $ 25.9 |
OTHER LIABILITIES (Details)
OTHER LIABILITIES (Details) - CAD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
OTHER LIABILITIES | ||
Defined benefit plans | $ 90.2 | $ 196.1 |
Decommissioning obligation | 59 | 19.3 |
Other | 39.1 | 37.2 |
Total other liabilities | $ 188.3 | $ 252.6 |
CAPITAL STOCK - Authorized capi
CAPITAL STOCK - Authorized capital stock (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Preferred B Shares | |
CAPITAL STOCK | |
Non-cumulative dividend | 1.00% |
Preferred C Shares | |
CAPITAL STOCK | |
Non-cumulative dividend | 1.00% |
Preferred D Shares | |
CAPITAL STOCK | |
Non-cumulative dividend | 1.00% |
Preferred E Shares | |
CAPITAL STOCK | |
Non-cumulative dividend | 1.00% |
Preferred F Shares | |
CAPITAL STOCK | |
Non-cumulative dividend | 1.00% |
Preferred H Shares | |
CAPITAL STOCK | |
Non-cumulative dividend | 1.00% |
Preferred G Shares | |
CAPITAL STOCK | |
Cumulative preferred dividend | 11.25% |
CAPITAL STOCK - Issued and outs
CAPITAL STOCK - Issued and outstanding capital stock (Details) - CAD ($) $ in Millions | Jul. 29, 2020 | Jan. 30, 2020 | Jul. 26, 2019 | Jan. 25, 2019 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Common shares, Amount | |||||||
Equity at beginning of period | $ 188.5 | $ 121.5 | $ (147.3) | ||||
Issuance of common shares | 6.8 | 153.3 | |||||
Reduction of paid-up capital | (720) | (465) | |||||
Equity at end of period | $ (338.3) | $ 188.5 | $ 121.5 | ||||
Capital stock | |||||||
Common shares, Number | |||||||
Number at beginning of period (in shares) | 10,718,327 | 10,711,165 | |||||
Issuance of common shares (in shares) | 7,162 | ||||||
Number at end of period (in shares) | 10,718,327 | 10,718,327 | 10,711,165 | ||||
Common shares, Amount | |||||||
Equity at beginning of period | $ 1,015.6 | $ 1,008.8 | $ 1,320.5 | ||||
Issuance of common shares | 6.8 | 153.3 | |||||
Reduction of paid-up capital | (720) | (465) | |||||
Equity at end of period | $ 295.6 | $ 1,015.6 | $ 1,008.8 | ||||
Parent | |||||||
Common shares, Number | |||||||
Issuance of common shares (in shares) | 3,756 | 3,406 | 3,563 | 162,640 | |||
Common shares, Amount | |||||||
Issuance of common shares | $ 3.5 | $ 3.3 | $ 3.3 | $ 150 |
STOCK-BASED COMPENSATION PLAN_2
STOCK-BASED COMPENSATION PLANS - Ultimate parent corporation stock option plan (Details) - Ultimate parent corporation stock option plan | 12 Months Ended |
Dec. 31, 2021shares | |
STOCK-BASED COMPENSATION PLANS | |
Exercisable period | 10 years |
Class B | |
STOCK-BASED COMPENSATION PLANS | |
Number of shares authorized to issue under stock-based compensation plans (in shares) | 26,000,000 |
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 |
Annual vesting percent of share based awards | 33.33% |
STOCK-BASED COMPENSATION PLAN_3
STOCK-BASED COMPENSATION PLANS - Ultimate parent corporation outstanding options (Details) - Ultimate parent corporation stock option plan $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2021CAD ($)Option$ / shares | Dec. 31, 2020CAD ($)Option$ / shares | |
STOCK-BASED COMPENSATION PLANS | ||
Options, balance at beginning of year | Option | 1,467,700 | 1,033,900 |
Options, granted | Option | 555,000 | |
Options, exercised | Option | (39,998) | 0 |
Options, cancelled | Option | (883,768) | (121,200) |
Options, balance at end of year | Option | 543,934 | 1,467,700 |
Number of vested options | Option | 51,864 | |
Weighted average exercise price, balance at beginning of year (in CAD per share) | $ 30.56 | $ 29.19 |
Weighted average exercise price, granted (in CAD per share) | 33.19 | |
Weighted average exercise price, exercised (in CAD per share) | 26.52 | |
Weighted average exercise price, cancelled (in CAD per share) | 30.73 | 30.95 |
Weighted average exercise price, balance at end of year (in CAD per share) | 30.58 | $ 30.56 |
Weighted average exercise price, vested options (in CAD per share) | $ 26.52 | |
Cash consideration on stock options exercised | $ | $ 0.2 | $ 0 |
Weighted average years to maturity | 7 years 8 months 12 days | |
Minimum | ||
STOCK-BASED COMPENSATION PLANS | ||
Exercise price (in dollars per share) | $ 26.52 | |
Maximum | ||
STOCK-BASED COMPENSATION PLANS | ||
Exercise price (in dollars per share) | $ 33.19 |
STOCK-BASED COMPENSATION PLAN_4
STOCK-BASED COMPENSATION PLANS - Deferred share unit and performance share unit plans (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020CAD ($) | Dec. 31, 2021EquityInstruments | Dec. 31, 2020EquityInstruments | |
Deferred share unit plan | |||
STOCK-BASED COMPENSATION PLANS | |||
Vesting life of share based awards | 6 years | ||
Outstanding units under plan | EquityInstruments | 23,293 | 85,007 | |
Performance Share Unit (PSU) | |||
STOCK-BASED COMPENSATION PLANS | |||
Cash consideration upon PSUs redemption | $ | $ 1.6 |
STOCK-BASED COMPENSATION PLAN_5
STOCK-BASED COMPENSATION PLANS - Parent corporation outstanding options (Details) - Parent corporation stock option plan $ in Millions | 12 Months Ended | |
Dec. 31, 2021CAD ($)Option | Dec. 31, 2020CAD ($)Option | |
STOCK-BASED COMPENSATION PLANS | ||
Options, exercised | Option | (30,000) | (16,500) |
Cash consideration on stock options exercised | $ | $ 2 | $ 1 |
STOCK-BASED COMPENSATION PLAN_6
STOCK-BASED COMPENSATION PLANS - Assumptions in estimating the fair value of awards (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Ultimate parent corporation stock option plan | ||
STOCK-BASED COMPENSATION PLANS | ||
Risk-free interest rate | 1.32% | 0.54% |
Distribution yield | 3.91% | 2.43% |
Expected volatility | 22.35% | 21.15% |
Expected remaining lives of stock-based awards | 3.7 | 4.6 |
Parent corporation stock option plan | ||
STOCK-BASED COMPENSATION PLANS | ||
Risk-free interest rate | 0.27% | |
Distribution yield | 1.00% | |
Expected volatility | 28.96% | |
Expected remaining lives of stock-based awards | 1 |
STOCK-BASED COMPENSATION PLAN_7
STOCK-BASED COMPENSATION PLANS - Liability and expense (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
STOCK-BASED COMPENSATION PLANS | |||
Liability for all vested options under intrinsic value | $ 0.1 | $ 1.9 | |
Consolidated charge related to stock-based compensation | $ 1.8 | $ 1.9 | $ 5.5 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE LOSS ATTRIBUTABLE TO SHAREHOLDER (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | |||
Equity at beginning of period | $ 188.5 | $ 121.5 | $ (147.3) |
Other comprehensive income (loss) | 84.9 | (57) | 13.3 |
Equity at end of period | (338.3) | 188.5 | 121.5 |
Accumulated other comprehensive loss | |||
ACCUMULATED OTHER COMPREHENSIVE LOSS | |||
Equity at beginning of period | (105.7) | (48.7) | (62) |
Other comprehensive income (loss) | 84.9 | (57) | 13.3 |
Equity at end of period | (20.8) | (105.7) | (48.7) |
Cash flow hedges | |||
ACCUMULATED OTHER COMPREHENSIVE LOSS | |||
Equity at beginning of period | 20.8 | 33 | (14.9) |
Other comprehensive income (loss) | 5.6 | (12.2) | 47.9 |
Equity at end of period | $ 26.4 | 20.8 | 33 |
Expected reversal period | 7 years 6 months | ||
Defined benefit plans | |||
ACCUMULATED OTHER COMPREHENSIVE LOSS | |||
Equity at beginning of period | $ (126.5) | (81.7) | (47.1) |
Other comprehensive income (loss) | 79.3 | (44.8) | (34.6) |
Equity at end of period | $ (47.2) | $ (126.5) | $ (81.7) |
COMMITMENTS (Details)
COMMITMENTS (Details) $ in Millions | Dec. 31, 2021CAD ($) |
2022 | |
COMMITMENTS | |
Minimum payments | $ 112.9 |
2023 to 2026 | |
COMMITMENTS | |
Minimum payments | 255.2 |
2027 and thereafter | |
COMMITMENTS | |
Minimum payments | $ 146.4 |
FINANCIAL INSTRUMENTS AND FIN_3
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Description of derivative financial instruments (Details) - 12 months ended Dec. 31, 2021 $ in Millions, $ in Millions | CAD ($)$ / $ | USD ($) |
Financial instruments and financial risk management | ||
Notional amount sold | $ 177.4 | |
Foreign exchange forward contracts | ||
Financial instruments and financial risk management | ||
Average exchange rate | $ / $ | 1.2578 | |
Notional amount | $ 141 | |
Senior Notes 5.375 Percent Due 2024 | Period Covered, 2014 To 2024 | Cross-currency interest rate swaps | ||
Financial instruments and financial risk management | ||
Average exchange rate | $ / $ | 1.1034 | |
Notional amount | $ 158.6 | |
Annual nominal interest rate (in percentage) | 5.375% | |
Annual interest rate on notional amount, adjustment to interest rate basis (as a percent) | 2.67% | |
Senior Notes 5.375 Percent Due 2024 | Period Covered, 2017 To 2024 | Cross-currency interest rate swaps | ||
Financial instruments and financial risk management | ||
Average exchange rate | $ / $ | 1.1039 | |
Notional amount | $ 441.4 | |
Annual nominal interest rate (in percentage) | 5.375% | |
Annual interest rate on notional amount, adjustment to interest rate basis (as a percent) | 5.62% | |
Senior Notes 5.125 Percent Due 2027 | Period Covered, 2017 To 2027 | Cross-currency interest rate swaps | ||
Financial instruments and financial risk management | ||
Average exchange rate | $ / $ | 1.3407 | |
Notional amount | $ 600 | |
Annual nominal interest rate (in percentage) | 5.125% | |
Annual interest rate on notional amount, adjustment to interest rate basis (as a percent) | 4.82% | |
Senior Notes 3.625 Percent Due 2029 | Period covered 2021 To 2029 | Cross-currency interest rate swaps | ||
Financial instruments and financial risk management | ||
Average exchange rate | $ / $ | 1.2109 | |
Notional amount | $ 500 | |
Annual nominal interest rate (in percentage) | 3.625% | |
Annual interest rate on notional amount, adjustment to interest rate basis (as a percent) | 4.04% |
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, 2021 | Dec. 31, 2020 |
Carrying value | Foreign exchange forward contracts | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Asset | $ (8) | |
Carrying value | Cross-currency interest rate swaps | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Asset | $ 116.3 | 333.3 |
Fair value | Foreign exchange forward contracts | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Asset | (8) | |
Fair value | Cross-currency interest rate swaps | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Asset | $ 116.3 | $ 333.3 |
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, 2021 | Dec. 31, 2020 |
Carrying value | Long-term debt | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Liability | $ (5,408.2) | $ (4,120) |
Carrying value | Foreign exchange forward contracts | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Liability | 0.9 | |
Fair value | Long-term debt | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Liability | (5,470.2) | $ (4,419.2) |
Fair value | Foreign exchange forward contracts | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Liability | $ 0.9 |
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, 2021 | Dec. 31, 2020 |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Fair value of derivative financial instruments designated as hedges | $ 117.2 | $ 325.3 |
Cash flow hedges | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Fair value of derivative financial instruments designated as hedges | 83 | 280.7 |
Fair value hedges | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Fair value of derivative financial instruments designated as hedges | $ 34.2 | $ 44.6 |
FINANCIAL INSTRUMENTS AND FIN_7
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Credit risk management (Details) - Credit risk management - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Gross carrying amounts of financial assets represent the maximum credit exposure | $ 751.1 | $ 638.5 |
90 days past due | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Trade receivables past due (as a percent) | 1.90% | 2.50% |
Trade receivables past due which had an established allowance for doubtful accounts (as a percent) | 5.30% | 4.10% |
FINANCIAL INSTRUMENTS AND FIN_8
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Changes to the provision for expected credit losses (Details) - Trade receivables - Accumulated impairment losses - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Balance at beginning of year | $ 15.7 | $ 14.3 |
Changes in expected credit losses charged to income | 16.6 | 20 |
Write-off | (17.9) | (18.6) |
Balance at end of year | $ 14.4 | $ 15.7 |
FINANCIAL INSTRUMENTS AND FIN_9
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Liquidity risk management (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | |||
Accounts payable and accrued charges | $ 559.2 | ||
Amounts payable to affiliated corporations | 89.2 | ||
Long-term debt | 5,408.2 | ||
Interest payments on long-term debt | 1,294.7 | ||
Lease liabilities | 153.8 | $ 142.3 | $ 114.2 |
Interest payments on lease liabilities | 19.8 | ||
Derivative financial instruments | (76.2) | ||
Total | 7,448.7 | ||
2022 | |||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | |||
Accounts payable and accrued charges | 559.2 | ||
Amounts payable to affiliated corporations | 89.2 | ||
Interest payments on long-term debt | 189.9 | ||
Lease liabilities | 35 | ||
Interest payments on lease liabilities | 5.9 | ||
Total | 879.2 | ||
1-3 years | |||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | |||
Long-term debt | 1,043.2 | ||
Interest payments on long-term debt | 437.7 | ||
Lease liabilities | 59.8 | ||
Interest payments on lease liabilities | 7.8 | ||
Derivative financial instruments | (96) | ||
Total | 1,452.5 | ||
3-5 years | |||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | |||
Long-term debt | 775 | ||
Interest payments on long-term debt | 337.3 | ||
Lease liabilities | 33.1 | ||
Interest payments on lease liabilities | 3.8 | ||
Total | 1,149.2 | ||
2027 and thereafter | |||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | |||
Long-term debt | 3,590 | ||
Interest payments on long-term debt | 329.8 | ||
Lease liabilities | 25.9 | ||
Interest payments on lease liabilities | 2.3 | ||
Derivative financial instruments | 19.8 | ||
Total | $ 3,967.8 | ||
Liquidity risk management | |||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | |||
Weighted average term of the Corporation's consolidated debt | 5 years 9 months 18 days | 5 years 1 month 6 days |
FINANCIAL INSTRUMENTS AND FI_10
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Market risk (Details) - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Increase of $0.10 | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Income | $ 0.7 | |
Other comprehensive income | 31 | |
Decrease of $0.10 | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Income | (0.7) | |
Other comprehensive income | (31) | |
Variance of $0.10 in the foreign currency exchange rate | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Unhedged purchase of goods and services | 8.8 | |
Unhedged acquisitions of tangible and intangible assets | $ 6.6 | |
Interest rate risk | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Long-term debt, fixed-rate debt (in percent) | 91.40% | 95.40% |
Long-term debt, floating-rate debt (in percent) | 8.60% | 4.60% |
Increase of 100 basis points | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Income | $ (0.7) | |
Other comprehensive income | (2.5) | |
Decrease of 100 basis points | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Income | 0.7 | |
Other comprehensive income | 2.5 | |
100 basis-point variance | ||
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||
Estimated sensitivity on interest payments | $ 4.6 |
FINANCIAL INSTRUMENTS AND FI_11
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT - Capital management (Details) - CAD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | ||||
Long-term debt | $ 5,380.1 | $ 4,111.5 | $ 4,240.2 | |
Lease liabilities | 153.8 | 142.3 | 114.2 | |
Derivative financial instruments | (117.2) | (325.3) | ||
Cash and cash equivalents | (10.5) | (74) | (2.4) | $ (1.1) |
Promissory note to the parent corporation | (160) | (160) | ||
Net liabilities | 5,246.2 | 3,694.5 | ||
Equity | $ (338.3) | $ 188.5 | $ 121.5 | $ (147.3) |
RELATED PARTY TRANSACTIONS - Co
RELATED PARTY TRANSACTIONS - Compensation of key management personnel (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
RELATED PARTY TRANSACTIONS | |||
Salaries and short-term benefits | $ 3.2 | $ 5.6 | $ 6.1 |
Share-based compensation | (1.3) | 1.2 | 3.9 |
Termination and other long-term benefits | 0.9 | 0.3 | 0.3 |
Total compensation | $ 2.8 | $ 7.1 | $ 10.3 |
RELATED PARTY TRANSACTIONS - Op
RELATED PARTY TRANSACTIONS - Operating transactions (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Parent | |||
RELATED PARTY TRANSACTIONS | |||
Revenues | $ 0.4 | $ 0.4 | $ 0.5 |
Purchase of goods and services | 10.2 | 9.6 | 9.9 |
Operating expenses recovered | (2.3) | (1.4) | (2.6) |
Corporations under common control | |||
RELATED PARTY TRANSACTIONS | |||
Revenues | 5.3 | 4.9 | 5.5 |
Purchase of goods and services | 109.7 | 95.7 | 123.2 |
Operating expenses recovered | 0.4 | 1.4 | (3) |
Other affiliated corporations | |||
RELATED PARTY TRANSACTIONS | |||
Purchase of goods and services | 10.6 | $ 5.6 | $ 2.1 |
Acquisition of property, plant and equipment and intangible assets | $ 4.6 |
RELATED PARTY TRANSACTIONS - Ma
RELATED PARTY TRANSACTIONS - Management arrangements (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
RELATED PARTY TRANSACTIONS | |||
Management fees | $ 40.5 | $ 41 | $ 50 |
RELATED PARTY TRANSACTIONS - Ac
RELATED PARTY TRANSACTIONS - Accounts receivable from affiliated corporations (Details) - CAD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
RELATED PARTY TRANSACTIONS | ||
Total receivables | $ 17.8 | $ 12.7 |
Parent | ||
RELATED PARTY TRANSACTIONS | ||
Accounts receivable | 2.8 | 2.8 |
Dividends receivable | 5 | 5 |
Interest receivable | 2.5 | 2.4 |
Corporations under common control | ||
RELATED PARTY TRANSACTIONS | ||
Accounts receivable | $ 7.5 | $ 2.5 |
RELATED PARTY TRANSACTIONS - _2
RELATED PARTY TRANSACTIONS - Accounts payable to affiliated corporations (Details) - CAD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
RELATED PARTY TRANSACTIONS | ||
Total payables | $ 89.2 | $ 67.9 |
Parent | ||
RELATED PARTY TRANSACTIONS | ||
Accounts payable | 21.2 | 33.9 |
Interest payable | 5 | 5 |
Corporations under common control | ||
RELATED PARTY TRANSACTIONS | ||
Accounts payable | $ 63 | $ 29 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - CAD ($) $ in Millions | Dec. 10, 2021 | Oct. 01, 2021 | Dec. 18, 2020 | Nov. 12, 2020 | Dec. 19, 2019 | Oct. 11, 2019 | Dec. 31, 2021 | Dec. 31, 2020 |
Related Parties | ||||||||
Subordinated loan from the parent corporation | $ (1,595) | $ (1,595) | ||||||
Parent | ||||||||
Related Parties | ||||||||
Repayment of subordinated loan | $ 1,473 | $ 2,950 | ||||||
Subordinated loan from the parent corporation | (1,595) | (1,595) | ||||||
Subordinated loan granted during the period | $ (1,473) | $ (1,700) | $ (2,950) | $ (1,595) | ||||
Interest rate on subordinated loan (in percentage) | 8.50% | 9.00% | 10.00% | 9.50% | ||||
Parent | Series L Preference Shares Member | ||||||||
Related Parties | ||||||||
Repayment of subordinated loan | $ 1,700 | |||||||
9346-9963 Quebec Inc | Series D Preferred shares | ||||||||
Related Parties | ||||||||
Number of preferred shares redeemed | 2,950,000 | |||||||
Payments for redemption of preferred stock in cash | $ 2,950 | |||||||
Investment in redeemable preferred shares | $ 2,950 | |||||||
Redeemable preferred shares acquired (in shares) | 2,950,000 | |||||||
Preferred stock annual dividend rate (in percentage) | 10.10% | |||||||
9346-9963 Quebec Inc | Series C preference shares | ||||||||
Related Parties | ||||||||
Number of preferred shares redeemed | 1,595,000 | |||||||
Preferred stock annual dividend rate (in percentage) | 9.60% | |||||||
9346-9963 Quebec Inc | Series L Preference Shares Member | ||||||||
Related Parties | ||||||||
Number of preferred shares redeemed | 1,700,000 | |||||||
Payments for redemption of preferred stock in cash | $ 1,700 | |||||||
Investment in redeemable preferred shares | $ 1,700 | |||||||
Redeemable preferred shares acquired (in shares) | 1,700,000 | |||||||
Preferred stock annual dividend rate (in percentage) | 9.10% | |||||||
9346-9963 Quebec Inc | Series M preference shares | ||||||||
Related Parties | ||||||||
Number of preferred shares redeemed | 1,473,000 | |||||||
Payments for redemption of preferred stock in cash | $ 1,473 | |||||||
Investment in redeemable preferred shares | $ 1,473 | |||||||
Redeemable preferred shares acquired (in shares) | 1,473,000 | |||||||
Preferred stock annual dividend rate (in percentage) | 8.60% | |||||||
Other affiliated corporations | ||||||||
Related Parties | ||||||||
Investment in redeemable preferred shares | $ 1,595 | $ 1,595 |
PENSION PLANS AND POSTRETIREM_3
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, 2021 | Dec. 31, 2020 | |
Pension defined benefit plans | ||
Disclosure of net defined benefit liability (asset) | ||
Benefit obligations at the beginning of the year | $ 686.4 | $ 570.4 |
Service costs | 27 | 26.1 |
Interest costs | 18.9 | 17.8 |
Plan participants' contributions | 5.4 | 6.2 |
Actuarial (gain) loss arising from: | ||
Financial assumptions | (74.6) | 82.7 |
Demographic assumptions | 11.3 | |
Participant experience | 3.3 | (0.6) |
Benefits and settlements paid | (19.7) | (17.2) |
Plan amendments and other | 1 | 1 |
Benefit obligations at the end of the year | 659 | 686.4 |
Postretirement defined benefit plans | ||
Disclosure of net defined benefit liability (asset) | ||
Benefit obligations at the beginning of the year | 46 | 40.9 |
Service costs | 1.7 | 1.6 |
Interest costs | 1.2 | 1.2 |
Actuarial (gain) loss arising from: | ||
Financial assumptions | (5.5) | 6.3 |
Benefits and settlements paid | (0.7) | (0.8) |
Plan amendments and other | (3.8) | (3.2) |
Benefit obligations at the end of the year | $ 38.9 | $ 46 |
PENSION PLANS AND POSTRETIREM_4
PENSION PLANS AND POSTRETIREMENT BENEFITS - Changes in the fair value of plan assets (Details) - Plan assets - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of net defined benefit liability (asset) | ||
Employer contributions | $ (30) | |
Pension defined benefit plans | ||
Disclosure of net defined benefit liability (asset) | ||
Fair value of plan assets at the beginning of the year | 536.3 | $ 485.8 |
Actual return on plan assets | 57 | 43.1 |
Employer contributions | 29.3 | 19 |
Plan participants' contributions | 5.4 | 6.2 |
Benefits and settlements paid | (19.7) | (17.2) |
Administrative fees | (0.6) | (0.6) |
Fair value of plan assets at the end of the year | 607.7 | 536.3 |
Postretirement defined benefit plans | ||
Disclosure of net defined benefit liability (asset) | ||
Fair value of plan assets at the beginning of the year | 0 | 0 |
Employer contributions | 0.7 | 0.8 |
Benefits and settlements paid | (0.7) | (0.8) |
Fair value of plan assets at the end of the year | $ 0 | $ 0 |
PENSION PLANS AND POSTRETIREM_5
PENSION PLANS AND POSTRETIREMENT BENEFITS - Components of plan assets and reconciliation of funded status (Details) - CAD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of net defined benefit liability (asset) | ||
Weighted average duration of defined benefit obligations | 18 years 6 months | 19 years |
Expected future benefit payments in 2022 | $ 16.9 | |
Reconciliation of funded status to net amount recognized | ||
Net defined benefit liability | 90.2 | $ 196.1 |
Pension defined benefit plans | ||
Reconciliation of funded status to net amount recognized | ||
Benefit obligations | (659) | (686.4) |
Fair value of plan assets | 607.7 | 536.3 |
Plan deficit and net amount recognized | (51.3) | (150.1) |
Postretirement defined benefit plans | ||
Reconciliation of funded status to net amount recognized | ||
Benefit obligations | (38.9) | (46) |
Plan deficit and net amount recognized | $ (38.9) | $ (46) |
Plan assets | ||
Plan assets | ||
Debt securities (as a percent) | 39.50% | 39.80% |
Other (as a percent) | 9.30% | 7.50% |
Total plan assets (in percent) | 100.00% | 100.00% |
Plan assets | Canadian | ||
Plan assets | ||
Equity securities (as a percent) | 21.00% | 21.90% |
Plan assets | Foreign | ||
Plan assets | ||
Equity securities (as a percent) | 30.20% | 30.80% |
PENSION PLANS AND POSTRETIREM_6
PENSION PLANS AND POSTRETIREMENT BENEFITS - Components of re-measurements (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Pension defined benefit plans | |||
Disclosure of net defined benefit liability (asset) | |||
Actuarial gain (loss) on benefit obligations | $ 60 | $ (82.1) | $ (75.5) |
Actual return on plan assets, less interest income anticipated in the interest on the net defined benefit liability calculation | 42.4 | 27.4 | 39 |
Re-measurement gain (loss) recorded in other comprehensive income (loss) | 102.4 | (54.7) | (36.5) |
Postretirement defined benefit plans | |||
Disclosure of net defined benefit liability (asset) | |||
Actuarial gain (loss) on benefit obligations | 5.5 | (6.3) | (10.8) |
Re-measurement gain (loss) recorded in other comprehensive income (loss) | $ 5.5 | $ (6.3) | $ (10.8) |
PENSION PLANS AND POSTRETIREM_7
PENSION PLANS AND POSTRETIREMENT BENEFITS - Components of the net benefit costs (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Pension defined benefit plans | |||
Employee costs: | |||
Service costs | $ 27 | $ 26.1 | $ 21 |
Plan amendments administrative, fees and other | 0.5 | 0.6 | 0.7 |
Interest on net defined benefit liability | 4.2 | 3.2 | 2.5 |
Net benefit costs (gain) | 31.7 | 29.9 | 24.2 |
Postretirement defined benefit plans | |||
Employee costs: | |||
Service costs | 1.7 | 1.6 | 2.1 |
Plan amendments administrative, fees and other | (3.8) | (3.2) | (23.3) |
Interest on net defined benefit liability | 1.2 | 1.2 | 1.8 |
Net benefit costs (gain) | $ (0.9) | $ (0.4) | $ (19.4) |
PENSION PLANS AND POSTRETIREM_8
PENSION PLANS AND POSTRETIREMENT BENEFITS - Defined contribution pension plans (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
PENSION PLANS AND POSTRETIREMENT BENEFITS | |||
Defined contribution expense | $ 17.6 | $ 16 | $ 15.6 |
PENSION PLANS AND POSTRETIREM_9
PENSION PLANS AND POSTRETIREMENT BENEFITS - Assumptions and sensitivity analysis (Details) - CAD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Pension and postretirement benefits | |||
Expected employer contributions in the next fiscal year | $ 27.1 | ||
Benefit obligations | |||
Percentage increase of discount rate (as a percent) | 0.10% | ||
Pension defined benefit plans | |||
Benefit obligations | |||
Decrease of retirement benefit obligation due to increase of actuarial assumption | $ 11.2 | ||
Postretirement defined benefit plans | |||
Benefit obligations | |||
Decrease of retirement benefit obligation due to increase of actuarial assumption | $ 0.9 | ||
Actuarial assumption discount rate | |||
Benefit obligations | |||
Discount rate, current year (as a percent) | 3.00% | 2.50% | 3.10% |
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) | 2.50% | 3.10% | 3.90% |
Rate of compensation increase, preceding year (as a percent) | 3.00% | 3.00% | 3.00% |
Assumed average retirement age | 62 years | 62 years | 62 years |
Assumed health care cost trend rate (as a percent) | 6.50% | ||
Assumed health care cost trend rate after eight years (as a percent) | 5.10% | ||
Plan assets | |||
Pension and postretirement benefits | |||
Employer contributions | $ 30 | ||
Plan assets | Pension defined benefit plans | |||
Pension and postretirement benefits | |||
Employer contributions | (29.3) | $ (19) | |
Plan assets | Postretirement defined benefit plans | |||
Pension and postretirement benefits | |||
Employer contributions | $ (0.7) | $ (0.8) |
DISCONTINUED OPERATIONS - Gener
DISCONTINUED OPERATIONS - General information (Details) $ in Millions | Jan. 24, 2019CAD ($) | Jan. 22, 2019CAD ($) | Mar. 31, 2019CAD ($) | Dec. 31, 2021CAD ($) | Dec. 31, 2020CAD ($) |
Promissory note receivable, 4Degrees Inc colocation data centers operations sale | |||||
DISCONTINUED OPERATIONS | |||||
Bearing interest rate | 4.90 | ||||
Principal amount | $ 260.7 | ||||
Note receivable reimbursed | $ 100.7 | ||||
4 Degrees Colocation Inc. data centers operations | |||||
DISCONTINUED OPERATIONS | |||||
Consideration from discontinued operations | $ 261.6 | ||||
Working capital adjustments paid | $ 0.9 | ||||
Gain on discontinued operations | $ 115.7 | $ 34.8 | |||
The amount deferred from the proceeds received on discontinued operations | $ 53.1 | ||||
Proceeds from the sale of realization of future conditions over a period | 10 years |