Cogeco Communications (CCA) Q1 2026 earnings summary

Executive summary

• Consolidated Q1 results aligned with internal plans and guidance, with all KPIs on track for the year.

• Canadian customer base continued to grow, while U.S. subscriber trends showed marked improvement for a second consecutive quarter, resulting in the best U.S. subscriber metrics in 15 quarters.

• Unified management of Canadian and U.S. operations to drive synergies, agility, and customer experience.

• Three-year transformation program is progressing, focusing on cost optimization and revenue generation.

• Network upgrades progressed, including the rollout of 2.5 Gigabit speeds in the U.S., and a new digital brand launch is planned for the U.S. next month.

Financial highlights

• Revenue for Q1 2026 was $707.2 million, down 4.3% year-over-year (4.9% in constant currency), mainly due to lower U.S. telecommunications revenue.

• Adjusted EBITDA decreased by 3.1% to $353.8 million (3.7% in constant currency), with a margin of 50.0%.

• Free cash flow declined 15.7% to $125.5 million, impacted by lower proceeds from asset disposals, lower EBITDA, and higher capital expenditures.

• Net capital expenditures rose 4.2% to $157.0 million, with capital intensity at 22.2%.

• Quarterly dividend increased by 7.0% to $0.987 per share.

Outlook and guidance

• Fiscal 2026 financial guidelines were reaffirmed, with expectations for improved U.S. financials in the second half of the year and continued Canadian customer growth as wireless and rural expansions scale.

• Fiscal 2026 revenue projected to decrease 1–3% and adjusted EBITDA to decrease 0–2% (constant currency).

• Net capital expenditures expected between $560M–$600M; free cash flow projected to increase 0–10%.

• Capital intensity targeted at 19–21%.

• Financing, acquisition integration, and restructuring costs expected to remain stable; depreciation to decrease slightly.