Cogeco Inc. (CGO) Earnings Call Transcript & Summary

Hello, ladies and gentlemen. My name is Marie-Hélène Labrie. I'm the first Senior Vice President for Public Affairs and Communications at Communication -- Cogeco and Cogeco Communications. I'm very happy to greet you here in Montréal. We will be having 2 general annual meetings today. First of all, Cogeco Communications' and then Cogeco's annual meeting. So the meetings are webcast. And given that we're in Montréal, the 2 meetings will be mainly carried out in French. Our presentation will be bilingual. For those here with us in the room, you are welcome to participate and ask questions during the question periods in French or English. This is how you should proceed if you wish to talk in this meeting: use one of the microphones in order for the people following the meeting by webcast to be able to hear you. Secondly, you need to identify yourself as a shareholder or a trust or proxy for Cogeco or Cogeco Communications. Only shareholders or proxy holders may speak at this meeting. The executive speaker of the Board will authorize you to speak in order for the meeting to proceed in -- with all due order. We would ask you to keep your questions for the correct period that is for Cogeco and Cogeco Communications. Once all the point on the agenda -- or subjects of the agenda have been exhausted, Mr. Audet and Jetté will be talking about the affairs of the business of the 2 corporations. Of course, these will constitute forward-looking statements in relationship to -- so you need to be aware of the forward-looking nature of these statements. And now I would like to introduce Mr. Louis Audet, who will be chairing the 2 general annual meetings of Cogeco and Cogeco Communication.

Thank you, Marie-Hélène. Dear shareholders, dear directors of the Boards of Cogeco and Cogeco Communication, dear colleagues and friends, ladies and gentlemen, meetings of Cogeco Inc. and Cogeco Communications, and thank you for taking the time to join us. I would like to proceed with the official opening of Cogeco Communications Annual General Meeting. And in terms of the general regulation of the corporation, I will act as the Chairman and Mr. Christian Jolivet will be the secretary for this meeting. Mr. Claire Girard and Steve Gilbert from Computershare are the scrutineers for this meeting. Computershare tells us that all the documentation -- required documentation has been sent to the shareholders and that we have a quorum today. I would now task the secretary to table the reports of the Computershare scrutineers with the document -- the official documentation for this meeting. The first point of order is to look at the financial statements of Cogeco for the year ending in August 2019. These also contain statements from the upper management and the reports of the auditors. These have been sent to the shareholders or according to the mode that they specified, these documents have been sent, I declare them received by shareholders. The second thing that we have to do today is election of Cogeco Communication Inc. Board members. There are 10 Board members that need to be elected today, and you can find the name of the 10 candidates in the information circular, of course, with all the required information about them. We're happy today to have a new candidate for the Board that is Mr. Bernard Lord, who is well-known to you all for having been in the position of Premier of New Brunswick from 1999 to 2006, and Mr. Lord is now the Head of Medavie, a Canadian corporation in the area of health care -- proposal and ask each candidate to rise when their name is called.

[Foreign Language] Elizabeth Alves, I'm a trustee proxy holder, and I would propose that the following person be put in candidacy for the Board of Director of Cogeco Inc. until the next shareholder meeting or until his or her successor is duly appointed or named: Colleen Abdoulah, Louis Audet, James Cherry, Pippa Dunn, Joanne Ferstman, Lib Gibson, Philippe Jetté, Bernard Lord, David McAusland and Carole Salomon.

Mr. Chairman, Luc Noiseux, I'm a shareholder, and I would support the proposal.

Thank you, Mrs. Alves. Candidates which shareholders would like to put forward? Since there are none, we will proceed to the vote. Mr. Secretary, could you please explain the procedure for the vote?

Thank you, Mr. Chairman. We will be voting. Those shareholders who have already voted by proxy, don't need to vote again. The shareholders and proxy holders can vote with the ballots that were handed over to them by the scrutineers when they registered. We will use the white ballots for Cogeco Communication and the blue ones for Cogeco Inc., you are invited to remain seated to vote. The scrutineers at the end of the vote will go through each aisle to collect the ballots once we have voted on every issue on the agenda. The final results will be compiled by the scrutineers and will be the deposited with SEDAR. And we will show the results for all voting shares and junior shares.

Thank you, Mr. Secretary for the explanation. Let's go on now for the vote on our directors. The votes have been expressed in proportion of 90% in favor of the candidates, and so these members are deemed elected nonetheless. As the secretary has mentioned, if there are shareholders who did not have the opportunity to vote, I would ask you to do it now with the white ballots, so that at the end of this meeting, we have a complete and exhaustive picture of the vote on -- of the vote of shareholders. [Voting]

Thank you. Now the next point on our agenda is the appointment of auditors. I would like for a proposal to be put forward.

Mr. Chairman, Patricia Curadeau-Grou. I'm a shareholder and I would propose that Deloitte accounting firm be named as the auditor of Cogeco Inc. with the mandate terminating at the next Annual General Meeting of Shareholders and that the Board be [ enabled to fix there ].

Joanne Ferstman. I'm a proxy holder.

Thank you, Mrs. Curadeau-Grou and Mrs. Ferstman. The votes that we got are in favor of Deloitte and in proportion of 90% and so we can deem that they have been chosen. Nonetheless, if there are shareholders that haven't voted on this decision, I would ask you to vote on this by using the white ballots. The next point on the agenda is the advisory vote regarding executive compensation. So you are called upon to vote for or against the advisory vote, which is described in the information circular. Could I have a proposal to this effect?

Mr. Chairman, my name is David McAusland. I'm a shareholder and I would propose that the advisory vote -- the following advisory vote be adopted. As an advisory note, and without disregard for the responsibility of the Board, the shareholder support, the initiative of the corporation in -- regarding executive compensation, this is described in the information circular for this meeting. Carole Salomon?

Motion.

Thank you very much Mr. McAusland, Mrs. Salomon. So we can already conclude that this has moved forward. Nonetheless, we'll pause a second in case some shareholders who have not had an opportunity, wish to vote at this time. This concludes the issues on our agenda for Cogeco Communication. I would now ask the scrutineers to collect the ballots -- the additional ballots, if there are any. Please raise your hand so that the scrutineer may come to see you and collect your ballot, so that we may compile the final vote and deposit it to the -- in the documents of the corporation. I would like to remind you that following the next Annual Meeting of Cogeco Inc., we will have a presentation by Philippe Jetté on the comments.

Philippe Jetté. If there was a shareholder in the meeting believes that they should ask a question before we close the meeting, this would be the appropriate time to do so. Are there any questions? It appears there isn't, may I have a motion to close the meeting, please.

Mr. Chairman, Lib Gibson, shareholder. I move that the meeting be ended.

Mr. Chairman, Colleen Abdoulah, proxy holder, I second that motion.

Thank you, Mrs. Gibson and Abdoulah. May I ask who is in favor by a show of hands, please? Anyone opposed? Thank you. The motion is carried. We'll now go on to the meeting -- Cogeco Inc.'s Annual Shareholders Meeting. As for Cogeco Communications Inc. and in compliance with the general regulations of the company. I will be acting as Chairman for this meeting and Claire Girard and Steve Gilbert of Computershare, scrutineers, are here for this meeting. They have confirmed that all documents have been sent as required and that we have a quorum. I would now ask the meeting's secretary to table these document with the corporation's information and I declare the annual meeting duly constituted. As with Cogeco Communications' meeting, we need to look at the financial statements, those and the statement of upper management and the report of the auditors have already been sent, either through e-mail or through mail to our shareholders and this has been confirmed by Computershare. So we simply declare them received and tabled without any further action. We will now go on to election of Cogeco Inc.'s Board members. The Board has determined that 9 directors must be elected. We can find their name and a short description of their qualifications in the information circular of the company that you've received. We are very happy to greet to a candidacy of Cogeco Inc.'s, Mrs. Patricia Curadeau-Grou, who was an administrator of our corporations and has been a member of Cogeco Communication from 2012 to 2019. We've also greeted on the Board this year, Mr. Arun Bajaj, who is presently in charge of human resources at Gildan, and who has worked during the -- 16 last years over at Nissan. Can I have a formal proposal and ask each candidate to rise when we call their name, please?

Mr. Chairman, Caroline Dignard. I'm a proxy holder, and I would propose that the following people -- persons be put in candidacy for election to the Board of Cogeco Inc. for a mandate ending at the next General Annual Meeting of Shareholders or at the time when his or her successor is named -- is duly named or elected: Louis Audet, Arun Bajaj, Marianne Bell -- Mary-Ann Bell, sorry, James Cherry, Patricia Curadeau-Grou, Samih Elhage, Philippe Jetté, Normand Legault and David McAusland.

Mr. Chairman, Philippe Bonin, I'm shareholder and I support the proposal.

Thank you very much, Mrs. Dignard and Mr. Bonin. Are there any other candidacies? The proxy votes that we have received are in favor by 99% for the candidates that have been proposed by the Board for election to the Board. And so we can conclude that they will be elected but nonetheless, we'll make a brief pause to give the opportunity for those who haven't had the opportunity to vote, to vote using the blue ballots. The next point on the agenda is the naming of the auditors of Cogeco Inc. and I ask for a proposal to be put forward to this effect.

James Cherry. I am a shareholder, Mr. Chairman, and I would propose that Deloitte professional accountants be named as the accountants of Cogeco Inc. for a mandate ending at the next annual meeting. And that the Board be authorized to determine their honorarium.

Mr. Chairman, Samih Elhage, and I'm a proxy holder, and I support this proposal.

Thank you, Mr. Cherry and Mr. Elhage. The proxy votes already have determined a 99% majority for -- in favor of Deloitte and so we can deem the auditors to be appointed, but we will have a short break now to enable those who haven't voted to vote on the blue ballot. The next vote is the advisory vote regarding executive compensation in terms of remuneration of upper management. You are called upon to vote for or against this advisory vote, which is described in the information circular. Can I have a proposal to this effect?

Mary-Ann Bell, shareholder, Mr. Chairman, and I propose that the advisory vote be adopted in terms of -- as a consultation and without disregard to the role of the Board in terms of remuneration that we should approve the remuneration policy as described in the information circular for this present General Shareholders Meeting.

Normand Legault. I'm a proxy holder and I support the proposal -- I second the proposal.

Is it possible to intervene, Mr. Chairman, on this point?

Yes, you can.

My name is Willie Gagnon and I am here for the MÉDAC. There's not much light but on Page 84 of the circular, there's a summary [ board ] on remuneration where we see that your remuneration has gone down $3 million. We congratulate you for that. But we are wondering if it's the same $3 million that has been transferred to the upper management of the company. If this was the case, we have a habit of opposing such a move. And we would invite you -- invite the shareholders to vote against this policy -- remuneration policy.

Can you explain to me, sir, what is the point that you find inappropriate.

Well, I'm not saying it's inappropriate necessarily. I'm just asking -- wondering that if the 3 million that you no longer have has been given to the Chairman.

Well, you have my last year's salary and you have my salary 2 years ago that has been reduced to my salary this year, given that I'm Chairman -- Executive Chairman of the Board for a transition period of 3 years. And what you have that is the result after 1 year. Yes, my salary was reduced because my responsibilities were reduced.

Thank you for the details.

Now I need to tell you that we have received proxy votes in favor of the proposal in a proportion of 98%. And so we can foresee that this proposal will be adopted. Are there any people who have not had the opportunity to vote? If that is the case, you may do so right now. Thank you. So ladies and gentlemen, this concludes the agenda -- all the points that were in the agenda for the Cogeco Annual Meeting. And so I would ask the scrutineers to pick up the blue ballot in order to complete the compilation of the votes so that it may be revealed to the public -- to the general public a little later today, and to hand over those results to the meeting secretary so that they may be tabled with the register of the company. And you will have the opportunity to ask Mr. Jetté questions later on, but if a shareholder deemed that it is important for him to -- or her to ask a question before this meeting concludes, this would be the time to do so.

Mr. Chairman, Willie Gagnon again from the education movement and defense of shareholders. Every year, we would like to underline that the presentation of the Chairman of the Board and the CEO of the company should be made before the election of administrators. I know this would be difficult because there are 2 meetings, but this is generally the way in which these things proceed, given that it is on the basis of what you've done during the year that we should ask the question if we're in favor of the election of somebody or another.

Don't go, don't go because I haven't completely understood what you were trying to say, please, excuse me. The presentations that you're about to make, we would prefer that they occur before the actual election of directors you would like the meeting to begin like that?

Yes, because we would like to know what happened during the year, you understand the logic.

Well, we will discuss this.

Yes, thank you. We would be very happy if you would do so.

Thank you for this proposal or suggestion. So at this time, we will close our meeting. Can I have a proposal to close the meeting?

I'm Nyisztor. I am a shareholder and I would propose to complete or terminate or close the meeting of Cogeco Inc.

I'm Mr. Arun Bajaj, I am a proxy holder and I support the proposal.

Thank you, Mrs. Nyisztor and Mr. Bajaj. We will have a raise -- a show of hand to vote those in favor of closing the meeting. Those oppose. No? So the proposal is adopted. In a few moments, our CEO, Philippe Jetté, will give you a complete situation on the state of the nation, so-called, and I would also have a few comments to make on 2019, which was the first year that I acted as Executive Chairman of the Board. And Philippe, who came on, on the 1st of September 2018, that's his first year as CEO, and so you will have the opportunity to talk about this -- that year in a few moments. During fiscal 2019, we took a very important strategic decision that is to get rid of Cogeco PEER 1 for data storage and communication to concentrate on the wideband networks either by fiber or coaxial cable. And this was a decision that was well received by shareholders as the share motion showed since May last year, we further explored the opportunity of becoming a wireless provider if financial and regulatory conditions were acceptable. At the same time, we're looking for acquisitions and continue to develop our markets in the U.S., especially in Florida. And in this perspective, in January last, we had made the acquisition of FiberLight in Florida, which was a strategic -- true strategic gain, which extended our network from Miami to West Palm Beach, to reach out to many places where there are multiple residential buildings. And we've also acquired 10 new radio stations in Québec in Cogeco Media. [Foreign Language] Cogeco's social responsibility principals have always been at the core of our values and our projects. This is precisely why over the years, we have probably contributed over 13.1 million in cash and in kind donations as well as sponsorships to several organizations in the regions where we operate. We were especially honored to sign the Organisation for Economic Co-operation and Development's business for inclusive growth, the G7 Summit in Biarritz, in France, and that was last August. We have taken concrete actions in this direction, and we must continue to do so, as we seek the most effective way to share more fairly the fruits of the economic development to which we contribute. And there will be no peaceful society if all companies do not put themselves on the same page in this regard. We are also constantly working to build our identity, which is unique and focused simultaneously on our customers. An identity, which is unique, centered on our customers, our employees and our fellow citizens, like Cogeco's new visual brand platform that places people at the heart of our actions, which are designed to be innovative and accessible to all in a -- in service to a modern society, which is in mutation. The remarkable results achieved this year would not have been possible without the hard work and visionary leadership of Philippe Jetté, our CEO. Driven by his resolve and the work of the entire team, Cogeco closed out fiscal 2019 solidly, which bodes well for sustained growth. In that same vein I would like to warmly thank all the members of the Board of Directors of Cogeco Inc. and Cogeco Communication for your unwavering support of our company's growth initiative. [Foreign Language] change as compiled by The Globe and Mail's annual board games review. We appreciate all of your continued trust and your invaluable contribution. It's been an honor for me to carry out my duties over the past year in my new role as Executive Chairman, and we now look forward to another year of innovation and growth. Together, we continue to focus on creating value and maintaining our undisputed market leader position. And our duty is to ensure that our employees, our communities, our shareholders and our customers continue to be proud to continue to place their trust in us. [Foreign Language], Philippe.

Thank you, Louis, for those kind words. Dear shareholders, members of the Board of Directors of Cogeco Inc. and Cogeco Communication Inc., colleagues, ladies and gentlemen, good morning, and thank you for joining us today. Fiscal 2019 marked the outcome of the renewal brought on by significant changes and initiatives that are transformative, put in place at our company, along with a new management team and an attentive Board of Directors focused on our success. We have implemented a sustainable strategy based on our vision and the fundamental principles of our vision. The success achieved in this financial year augurs very well for many more years of progress. This was my first year as President and Chief Executive Officer, and it was an honor for me to become part of the long history of Cogeco, where the future is looking very bright indeed. The work and effort that our teams have put in, together with the changes we instituted, allowed us to maintain a good financial performance. For Cogeco Inc., we reported an 8% increase in our consolidated revenue, which stood at $2.44 billion while adjusted EBITDA rose to $1.13 billion, up 9.4%. Profit for the year reached $443.5 million, and the corporation generated free cash flow of $469.2 million. Dividends paid to our shareholder rose 10.3%, reaching $1.72 per share. At Cogeco Communication Inc., consolidated revenue increased by 8.6% in fiscal 2019 to reach $2.33 billion, while adjusted EBITDA reached $1.11 billion, up by 10%. Profit for the year increased to $432 million, and the corporation generated free cash flow of $454.1 million. Dividend paid to shareholders increased by 10.5% to reach $2.10 per share. The 2019 fiscal year was marked by a number of transformational projects. The sale last spring of Cogeco PEER 1 by Cogeco Communication helped us refocus our resources on our Canadian and American broadband services. This transformation has provided greater flexibility to pursue our organic growth as well as acquisitions. During the year, we have also committed to invest more than $1 billion over the next 4 years in our Québec and Ontario networks in line with government programs aimed at improving high-speed internet access in regional areas. To achieve this, we are working closely with the various levels of government municipalities and towns concerned in order to extend and enhance our network to deliver high-speed connectivity to as many residents, businesses and institution as possible. At Cogeco Media, meanwhile, we will continue to ensure that our offering is continuously aligned with market realities and with our listeners' changing needs. Our mission has always been based on this approach. We must continue, and it is our duty to measure up to what we have built throughout our history. Ongoing exploration of various business models for our potential entry into the wireless market. And by the presentation of a renewed regulatory framework or model for Canada, as part of government consultations, we suggested a new mobile network operator model to policymakers in Canada. This hybrid model would enable us to launch a profitable wireless service. During fiscal 2019, we elected not to take part in the auction for spectrum license. The structure of the auction-based on very large geographic areas, made the acquisition of such spectrum uneconomical for our company. In this context, we are pleased by the government's intent to create smaller service areas and are hopeful that they will be used as part of the upcoming auction. One of the year's highlights was the deployment at a larger scale of a collaborative model of internal services, shared between the corporate team and our subsidiaries, in order to optimize our operational efficiencies through increased group synergies. The primary goal is to provide more time for subsidiaries to focus on activities, such as sales and marketing and customer support. This way, we can continue delivering an outstanding customer experience. Cogeco's mission is to connect all our customers to the digital world and create unmatched communication experiences. Our customer needs have always been at the heart of our actions. This is why our priorities in fiscal 2019 remain true to this commitment. Our new tagline, Cogeco “A world of your very own” was launched early in fiscal 2020. This slogan focuses on the human touch and on our customers. Accessibility and proximity to our customers and communities, form the basis of our mission. Which is what is leading this shift. In a market that is as competitive as ever it is vital for us to further highlight what it is that makes us constantly stand apart from the crowd. We will also continue to strengthen the quality of our offering, enabling us to maintain comparative advantages over our competitors. Let's turn to our Canadian broadband service subsidiary. At Cogeco Connexion, our eagerness and ambition to leverage our superior internet speeds and video services enable us -- and video services enabled us in fiscal 2019 to continue expanding our gigabyte internet offering and reach 60% of our footprint for both residential and business customers. We are making good progress with the development of the IPTV platform and have started our beta launch. We're most enthusiastic about offering this enhanced experience for our customers through powerful technology that will provide a user friendly, all-in-one interface as well as wireless equipment and advanced capacity for customers to view selected content when they want and how they want, along with leading-edge customization features. Improvements have also been made to our current products and to our existing footprint. In addition, our digital transition has enabled us to improve our customer experience with the new -- with self-serve features that range from installation to management of appointments and change in television channels. [Foreign Language] experience, whether through new self-serve options or customer service improvements. We firmly believe that improving efficiency and productivity goes hand in hand with a truly enjoyable customer experience. We continue to focus on improving our high-speed internet and advanced video services, always aiming for better performance and reliability. We have strengthened our competitive advantage in high-speed internet services, in particular, by increasing top download and upload speeds for our internet product for both residential and commercial services. In addition, we have expanded the footprint of the gigabit service to more than 90% of our footprint. We also introduced major video enhancement through our TiVo platform, which provides easier use for our customers. This was accomplished through the deployment of a voice-activated controls for our TiVo -- from our TiVo Experience 4 platform as well as the launch of Amazon Alexa functionality and a new mobile application for multiscreen viewing along the migration to IP video-on-demand. In addition, we have experienced strong growth for our -- in our residential and business segment in Atlantic -- in all Atlantic Broadband territories. Certain programs were targeted to retain high-value residential customers and we have focused our efforts on moving more business customers into long-term contracts. Key initiatives were deployed to reach new potential customers in some of our competitors' market. These efforts were part of our strategy to leverage our competitive advantage in order to promote customer loyalty and drive market growth. As regards to Cogeco Media, the acquisition of 10 radio stations from RNC Média in late 2018, has helped us strengthen our market position. I'm proud to say that our network has 22 stations in Québec now and 1 in Ontario. These stations are very popular in their communities and are enabling us to extend our quality broadcasting service to all our listeners. Since these acquisitions, we have made significant changes in brand image for some of these stations to successfully integrate them into Cogeco's broader offering. The Cogeco media team is working hard to ensure that our stations maintain their benchmark positions in their respective markets and ensure that ratings remain strong. Despite a challenging advertising market. Surveys conducted by numerous over the last year confirmed that 98.5 FM in Montréal remained the most listened to radio in its segment. Many of the stations have diversified their programming and added popular host to their current talented teams. Our offering is being modernized continuously, along with our presence in the digital world. And it is in this -- with this in mind that Cogeco Media has launched its new mobile application, providing listeners with quality content anywhere at any time. In particular, our corporate social responsibility activities. I'm particularly proud to say that our corporate social responsibility program has been considerably strengthened to maintain our remarkable position as a good corporate citizen. Among with our main achievements in fiscal 2019, are the review of our -- of all our key performance indicators, sorry, to ensure that we meet our environmental, social and governance goals. Along with the addition of new indicators. We have also launched a number of CSR initiatives, at our Atlantic Broadband and Cogeco Connexion subsidiaries. Thanks to these initiatives, we have reduced our greenhouse gas emission on a per revenue basis by 40% over the last 5 years. In addition, we have diverted 163,000 kilograms of electronic waste from landfills by further increasing recycling and reusing. We are proud to have partnered with Computers for Success Canada by donating used electronic devices to support the program's goal of delivering improved access to technology for Canadian at risk of digital exclusion. We are also proud to play a role in the Connected for Success program. Through which we offer affordable internet services to more than 475 low-income families in Quebec and Ontario. Our corporation's social conscience has been recognized once again. Cogeco received several distinctions during the 2019 fiscal year, including the inclusion of Cogeco Communication on the Corporate Knights 2019 list of the Best 50 Corporate Citizens in Canada. I'm delighted to announce the publication of our next CSR report in February. Our report will be in a new, entirely digital format, providing more dynamic and attractive content. Before touching on the outlook for fiscal 2020, I would like to present a few highlights of our financial results for the first quarter, which ended on November 30, 2019. The results were announced yesterday after the market's close, and these results generally puts us on a favorable trajectory to meet previously announced projection. At Cogeco Inc., revenue increased by 1.8%, to reach $618.5 million. Adjusted EBITDA increased by 5.2% to reach $290.5 million. Profit for the period amounted to $94.2 million, an increase of 19% compared to the same period last year. Free cash flow decreased by 3.6% to reach $108.9 million, due to higher capital expenditures in our broadband businesses, and the dividend declared was $0.475 per share. [Foreign Language] Now turning to Cogeco Communication. Revenue increased by 1.8% to reach 586%. This represents an increase of 1.3%. Adjusted EBITDA increased by 5.3% to reach $282.1 million, representing 4.9%. Profit for the period amounted to $89.7 million, an increase of 19.3% compared to the same period last year. Free cash flow decreased by 4.3% to reach $102 million due to higher capital expenditures in our Canadian broadband business, and the corporation declared a dividend of $0.58 per share. Now let's look at fiscal 2020 and our priorities for this year. Our strategic priorities at Cogeco are to deliver an exceptional customer experience through continuous innovation in our service offering. We want to grow our footprint and obtain our fair share of market in current segments. We want to optimize our cost structure and operational efficiency by leveraging group synergies facilitated through a highly collaborative culture. We want to use our leadership and digital technologies and customer relationship management and continue building a strong brand, and offer an employee experience which is exceptional. For our Canadian broadband services, Cogeco Connexion strategic plan covers the following major points: deliver organic growth by introducing value-added services for residential customers, including our new TV offering with the launch of our IP television. Generate organic growth by expanding our business customer base, optimize the return on investment by delivering our services more efficiently and improving loyalty through a differentiated customer experience strategy. Explore a potential wireless service that can be profitable, and that is within our financial means. Enable business transformation through modern people management practices that will provide meaningful and engaging employee experiences. For our Atlantic Broadband services, the strategic priorities for Atlantic Broadband are as follows: deliver an exceptional customer experience while fostering team member engagement. Leveraging internet superiority and our advanced video platform to promote loyalty and customer satisfaction. Focus on growth in the business market. Drive unit growth and customer satisfaction through product marketing and brand positioning. Continue Florida's expansion efforts while actively pursuing acquisition opportunities. And on this point, we were happy to announce last Friday the acquisition of Thames Valley Communications which serve approximately 10,000 customers in the Southeastern Connecticut region. This acquisition will nicely complement our presence in the region, and the closing of the transaction is expected within the next 3 months. For media sector, the strategic priorities for Cogeco Media are continually enhance programming quality and diversify our product portfolio to grow market and share profitably. In conclusion, although fiscal 2020 represents its share of challenges, it's also filled with solid opportunities that we are confident of being able to seize. The contribution of each of our 4,500 employees is vital to our success, and I am honored to be able to count on their talent and their passion in this on a daily basis. Our great team continues proudly to embody our corporation's value, namely innovation, devotion to customer service, team spirit, trust and respect. I thank them for this. And I want to warmly thank Louis Audet and the members of the Board of Directors for their wise advice, for the knowledge also that they have shared with me and their unwavering commitment to Cogeco. I'm proud of my first year as President and Chief Executive Officer, and I'm pleased with the results we have delivered. I would also like to underline the collaboration, support and loyalty of the senior management team as well as the devotion of all Cogeco employees. By working together more closely we continue to meet the needs of our customers of the communities we serve and of our colleagues. In this way, we will meet our business goals, maintain our leadership role in the communications sector and create value for our shareholders. Mr. Executive Chairman, dear shareholders, member of the Cogeco Board of Directors, colleagues, ladies and gentlemen, thank you for being here and for listening.

Thank you very much, Philippe, and congratulation for covering the events of the last year. The moment is now -- has now come to ask questions to Philippe, if they so wish. So I would invite you to go to the microphone, go to the mic, identify yourself. And we're ready for you, Mr. Gagnon.

Mr. Chairman, Willie Gagnon from the MÉDAC, the movement for defense of shareholders in education and economic matters. I would like to congratulate you for your performance in the stock market that enabled us to buy shares in other companies and to be able to echo the subjects that the CEO covered in terms of environmental and social issues on Page 38 of the circular. You talk about your very good performance in this area. We are obviously happy with this. It says here, the responsibility in the code of ethics in matters of social responsibility and the code of conduct of suppliers is the framework of the RSC program of the social responsibility program. Can you give me a little more light, perhaps I could read the excerpt, which is all to your advantage. The directing committee, which is made up of all the business units is responsible to examine the policy in matter of social responsibility, define or identify main risks, which stem from it and determine objectives and collect the results obtained by the corporation in this matter in order to further its goal of social responsibility, the corporation developed performance indicators in this area. Now these indicators -- and this is my question. I understand that you are respecting this policy for at the moment. But eventually, should there be noncompliance or if you don't achieve those results as determined by our committee, would there be any consequences on the remuneration of upper management. This is a question that we asked last year to all the companies that we have in our portfolio, and we got relatively satisfying questions -- answers from all the great banks who committed, even if they didn't have policies to tie in remuneration to. And so the Board in these cases would call upon its discretionary power and lower the remuneration. Do you have that?

Yes, it is. And I will ask our CEO to elaborate.

Yes, remuneration, obviously, takes into consideration the financial performance. Of course, there is another element, which is customer satisfaction in our markets. The health and safety of our employees are part and parcel of the same preoccupations of upper management. And so this is also included in the compensation formula and the commitment of our employees to serve well our clients. So there are a whole series of factors that are being considered, which covers both the financial domain and the social responsibility.

I'm not hearing you about your ESG policy and the environmental policy. That was my question.

Well, this is a sub-component of it. It's well defined in the information circular, if you will, if you want to drill down into the details of the formula and the calculations involved, the social aspect, the involvement in our community goes through the work that we perform and the -- that our employees perform with our clients in those communities, and this is reflected in our success.

Thank you.

Well, thank you, sir. Are there any other questions, please? Thank you very much for joining us this morning to participate in these shareholder meetings. Your presence is much appreciated. Again, I think we should take the opportunity to congratulate Philippe and his team for a very good year. Keep it up, guys. You're doing a great job. Now I would invite you to go down to the foyer so that we may partake in refreshments. Thank you.