RE:RE:My opinion on the Amendment of the credit Facility.Sure,Well first off we consider interest expense as a financing expense.Hence, we subtract them from operating cash flow and send them to financing cash flows.This will naturally lower the free cash flows.
Now if you substract off intrest expenses, the free cash flows would appear stronger and therefore giving more flexibiblity by substracting intrest expense .
Finally by just using operating cash flows in the case of corus would be an accurate asssement because in the case of corus their contenting spending is amortized and appears all in the expense section wich affects net income wich then goes directly into the operating cash flows . If you look at corus cash flow statements they practically have no capex spending and that is because like i mentionned before all contenct spending get's amortized and expensed over time. So by eliminating interest expenses the banks would neglect looking at the finance expense ( I beleive they accepted this becuase corus has been paying of debt at a blistering pace over the last 4 years and holds a balance sheet that is stronger then ever ). This will still give an accurate enough picture and satifies the banks as they can still asses an accurate picture of the financial situation by just looking at total cash flows instead and at the same time this gives corus more felxibility on the convenant ratios.