Cogeco (CGO) Q1 2026 earnings summary

Executive summary

• Consolidated Q1 results aligned with internal plans and prior guidance, with all KPIs on track for full-year targets.

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

• Unified management structure for Canadian and U.S. operations to drive synergies and accelerate growth.

• Transformation program is progressing, supporting operational efficiencies and cost reductions.

• Fiscal 2026 financial guidelines were reaffirmed, and credit outlooks were upgraded by S&P and Moody's.

Financial highlights

• Revenue for Q1 2026 was $735.6M, down 3.8% year-over-year (4.5% in constant currency); adjusted EBITDA decreased by 2.5% to $361.8M (3.1% in constant currency).

• Profit for the period was $96.1M, with adjusted profit attributable to owners up 6.3% to $28.9M.

• Free cash flow declined 14.1% to $130.9M, mainly due to lower asset disposal proceeds and higher capital expenditures.

• Dividend per share increased 7% year-over-year to $0.987.

• Net debt-to-EBITDA ratio at 3.2x, with available liquidity of $893M.

Outlook and guidance

• Full-year guidance for all KPIs maintained; annual financial guidelines unchanged.

• Fiscal 2026 revenue projected to decrease 1–3% and adjusted EBITDA to decrease 0–2% year-over-year, but free cash flow is expected to grow 0–10%.

• Q2 consolidated revenue and EBITDA expected to decline low to mid-single digits year-over-year, mainly due to U.S. business.

• Stronger U.S. financial performance anticipated in the second half, driven by customer trends and cost/revenue initiatives.

• Net debt-to-EBITDA target remains in the low three turns range.