Shaw Communications says restructuring will save $50 million annually

By Lisa Kerner

Charlotte, N.C., April 13 - Shaw Communications Inc. generated C$167 million of free cash flow in the fiscal second quarter and remains on track to generate C$600 million of free cash flow in full-year 2011, chief executive officer Brad Shaw said during the company's earnings conference call on Wednesday.

Shaw highlighted the current competitiveness of the communications industry and said the company will strategically evaluate the wireless environment before launching a wireless service.

The company's recent restructuring, which cost between C$25 million and C$30 million and resulted in the elimination of 550 employees, is expected to save C$50 million annually.

In December, Shaw closed an offering of C$900 million of senior notes including C$500 million of 5.5% notes due 2020 and an additional C$400 million from its reopened offering of 6.75% notes due 2039.

Shaw reopened the 6.75% notes due 2039 again in February to sell another C$400 million.

Proceeds from both offerings were used to repay debt related to the Canwest Global Communications Corp. acquisition.

For the quarter ended Feb. 28, Shaw reported consolidated revenue of C$1.2 billion, which is up 29% over the comparable period in 2010.

The company reported net income of C$167 million, compared with C$139 million for the prior-year period.

Shaw Communications is a Calgary, Alta.-based diversified communications company.

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