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Shaw Communications Inc. (SJR - Analyst Report) declared mixed financial results for the fourth quarter of fiscal 2013. The company currently has a Zacks Rank #2 (Buy) and it competes aggressively with other Canadian telecom and cable MSOs, such as Rogers Communications Inc. (RCI - Analyst Report), Telus Corp. (TU - Analyst Report) and BCE Inc. (BCE - Analyst Report).   

GAAP net income from continuing operations was $112.3 million, down 12% year over year. Earnings per share were 23 cents, down 14.3 % year over year and significantly below the Zacks Consensus Estimate of 32 cents. Quarterly total revenue climbed 3% year over year to approximately $1,196.2 million, marginally above the Zacks Consensus Estimate of $1,193 million.

Quarterly operating income before amortization was around $476.2 million, down 1% from the year-ago quarter. Quarterly operating margin stood at 39.8% against 41.4% in the prior-year quarter. In the fourth quarter of fiscal 2013, Shaw Communications generated around $412 million of cash from operations, up 20.8% year over year. Free cash flow was $205.5 million, down 22.7% year over year.  

At the end of fiscal 2013, Shaw Communications had cash and marketable securities of $405 million and outstanding debt of $4,625.3 million compared with $435.5 million and $4,908.2 million, respectively, at the end of fiscal 2012. The debt-to-capitalization ratio at the end of fiscal 2013 was 0.47 compared with 0.54 at the end of fiscal 2012.

Subscribers Statistics

As of Aug 31, 2013, the Video customer base was 2,040,247, reflecting a net reduction of 29,522 customers in the reported quarter. With the addition of 10,564 customers in this quarter, the company's Internet customer base stands at 1,890,506. Digital phone lines were 1,359,960, reflecting a year-over-year net addition of 4,722 lines. The DTH customer base was 903,565, representing a quarterly net reduction of 835 customers.

Cable Segment

Quarterly revenues were $785.3 million, up 1.9% year over year. Quarterly operating income before amortization was $380.2 million, remaining same year over year.

Satellite Segment

Quarterly total revenue of $210.2 million was up 2.8% year over year.  The segment’s quarterly operating income before amortization was $63.4 million, down 14.3% from the year-ago quarter.

Media Segment

Quarterly total revenue was $221.8 million, up 6.5% year over year. Operating income before amortization was $32.7 million, up 21.4% year over year.  

Financial Outlook

For fiscal 2014, management expects both total revenue and operating income before amortization to grow 2%-4% year over year. Free cash flow is expected to range from $625 million to $650 million.

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