SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934

Shaw Communications Inc.

(Translation of registrant’s name into English)

Suite 900, 630 — 3^rd Avenue S.W., Calgary, Alberta T2P 4L4 (403) 750-4500

(Address of principal executive offices)

     Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

     Form 20-F o Form 40-F þ

     Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o

     Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o

     Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

     Yes o No þ

     If “ Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-

 

 

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant, Shaw Communications Inc., has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date:		October 26, 2007
		Shaw Communications Inc.
By: /s/ Steve Wilson
Steve Wilson
Sr. V.P., Chief Financial Officer
Shaw Communications Inc.

NEWS RELEASE

Shaw announces solid fourth quarter results and 9% dividend increase

Calgary, Alberta (October 26, 2007) – Shaw Communications Inc. today announced results for the fourth quarter and fiscal year ended August 31, 2007. Consolidated service revenue of $715 million and $2.77 billion for the three and twelve month period improved 13.2% and 12.8%, respectively, over the comparable periods last year. Total service operating income before amortization¹ of $326 million and $1.24 billion increased by 18.5% and 15.0% respectively, over the same periods in 2006. Funds flow from operations² increased to $273 million for the quarter and $1.03 billion for the year compared to $221 million and $847 million in the same periods last year.

During the quarter Digital Phone lines grew by 41,604 to 385,357. Internet and Digital customers increased by 29,857 to 1,451,756 and 15,709 to 763,140, respectively. Basic cable subscribers decreased by 2,057 to 2,226,841 and DTH customers were up 1,686 to 879,585.

Free cash flow¹ for the quarter was $76 million bringing the annual total to $356 million. This compares to $55 million and $265 million for the same periods last year, an improvement of $21 million and $91 million, respectively. The growth in free cash flow was primarily related to higher service operating income before amortization, partially offset by increased capital investment.

Chief Executive Officer Jim Shaw commented, “Solid fourth quarter results conclude a year of significant accomplishments: Our service operating income before amortization grew 15% in fiscal 2007 and has grown in excess of 25% over the last two fiscal years. This pace has been driven by customer growth, value enhancements which support pricing, and the rapid penetration of Digital Phone. Despite tight labour markets, we have increased our workforce by over 1,500 employees over the last two years, to approximately 9,000 in total, in order to ensure that we deliver on our promise to provide exceptional customer service, which we believe remains a key differentiator. During the year, we reduced net debt and strengthened our credit metrics, repurchased over $100 million of shares, and more than doubled our dividend rate. We lead the North American cable industry in dividend yield and currently rank in the top 30 high-yielding corporations included in the S&P/TSX 300 Index. Our shareholders were rewarded for this success with a total annual return of over 50% on their shares. Looking forward, we are off to a solid start in fiscal 2008 and our outlook for the year calls for continued earnings growth.”

Net income of $136 million or $0.31 per share for the quarter ended August 31, 2007 compared to $210 million or $0.49 per share for the comparable quarter last year. Net income for the year was $388 million or $0.90 per share compared to $458 million and $1.05 per share last year. The current and comparable three and twelve month periods included non-operating items which are more fully detailed in Management’s Discussions and Analysis (MD&A). These included a gain on the sale of a portfolio investment in the third quarter of 2006, as well as tax recoveries related

to reductions in enacted income tax rates in each of the first, third and fourth quarters of 2006 as well as the current quarter. Excluding the non-operating items, net income for the three and twelve month periods ended August 31, 2007 would have been $100 million and $346 million compared to net income of $60 million and $212 million in the comparable periods.³

Cable division service revenue for the three and twelve month period of $542 million and $2.08 billion was up 16.0% and 15.2%, respectively, over the same periods last year. The improvement was primarily driven by customer growth and rate increases. Service operating income before amortization increased 23.0% to $267 million for the quarter and 16.1% to $996 million for the year.

Satellite division service revenue of $173 million and $692 million for the three and twelve month period, respectively, increased 5.3% and 6.3% over the comparable periods. The improvement was primarily due to rate increases and customer growth. Service operating income before amortization for the quarter and year were up 2.0% to $59 million and 10.7% to $244 million, respectively

Looking forward, Mr. Shaw noted: “For fiscal 2008, we expect service operating income before amortization to grow in an approximate range of 10% – 12%. Capital expenditures are forecasted to exceed $650 million as we continue to invest to ensure our network will support and maintain our leading broadband business, grow telephony products and provide next generation services for our customers. We plan to manage capital expenditures in line with business growth in order to target free cash flow generation of $450 million or better.”

Mr. Shaw continued, “Our Board of Directors has approved a 9% increase in the equivalent annual dividend rate to $0.72 on Shaw’s Class B Non-Voting Participating shares and $0.7175 on Shaw’s Class A Participating shares. This new rate represents an annual yield of approximately 2.8% based on the current trading price and will be effective commencing with the monthly dividend paid on December 28, 2007.

During the quarter, shareholders approved a two-for-one stock split of the Company’s outstanding Class A Participating Shares and Class B Non-Voting Participating Shares which became effective on July 30, 2007.

During the quarter, Shaw repurchased 4,408,400 of its Class B Non-Voting Shares for cancellation for $105 million. The Company plans to renew its normal course issuer bid in early November.

In closing, Mr. Shaw summarized: “As we head into our new fiscal year we look forward to what lies ahead and are confident that with our leading network infrastructure and the dedicated efforts of our employees we are ready to meet the challenge of a competitive market and deliver another year of solid results.”

Shaw Communications Inc. is a diversified communications company whose core business is providing broadband cable television, High-Speed Internet, Digital Phone, telecommunications services (through Shaw Business Solutions) and satellite direct-to-home services (through Star Choice). The Company serves 3.3 million customers, including almost 1.5 million Internet subscribers, through a reliable and extensive network, which comprises over 575,000 kilometres

of fibre. Shaw is traded on the Toronto and New York stock exchanges and is included in the S&P/TSX 60 Index (Symbol: TSX — SJR.B, NYSE — SJR).

This news release contains forward-looking statements, identified by words such as “anticipate”, “believe”, “expect”, “plan”, “intend” and “potential”. These statements are based on current conditions and assumptions and are not a guarantee of future events. Actual events could differ materially as a result of changes to Shaw’s plans and the impact of events, risks and uncertainties. For a discussion of these factors, refer to Shaw’s current annual information form, annual and quarterly reports to shareholders and other documents filed with regulatory authorities.

For more information, please contact:

Shaw Investor Relations Department
Investor.relations@sjrb.ca

Shaw Communications Inc.

MANAGEMENT’S DISCUSSION AND ANALYSIS
AUGUST 31, 2007

October 25, 2007

Certain statements in this report may constitute forward-looking statements. Such forward-looking statements involve risks, uncertainties and other factors which may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Included herein is a “Caution Concerning Forward-Looking Statements” section which should be read in conjunction with this report.

The following should also be read in conjunction with Management’s Discussion and Analysis included in the Company’s August 31, 2006 Annual Report and the Consolidated Financial Statements and the Notes thereto and the unaudited interim Consolidated Financial Statements of the current quarter.

CONSOLIDATED RESULTS OF OPERATIONS
FOURTH QUARTER ENDING AUGUST 31, 2007
SELECTED FINANCIAL HIGHLIGHTS

		Three months ended August 31,												Year ended August 31,
										Change												Change
		2007				2006				%				2007				2006				%
($000’s Cdn except per share amounts)
Operations:
Service revenue			715,471				631,888				13.2				2,774,445				2,459,284				12.8
Service operating income before amortization (1)			326,052				275,127				18.5				1,239,625				1,077,917				15.0
Funds flow from operations (2)			272,545				220,617				23.5				1,028,363				847,197				21.4
Net income			135,932				210,369				(35.4	)			388,479				458,250				(15.2	)
Per share data:
Earnings per share – basic		$	0.31			$	0.49							$	0.90			$	1.05
– diluted		$	0.31			$	0.48							$	0.89			$	1.05
Weighted average participating shares outstanding during period (000’s)			433,864				432,795								432,493				435,332

SUBSCRIBER HIGHLIGHTS

						Growth
						Three months ended								Year ended
		Total				August 31,								August 31,
		August 31, 2007				2007				2006				2007				2006
Subscriber statistics:
Basic cable customers			2,226,841				(2,057	)			2,766				20,521				41,281
Digital customers			763,140				15,709				9,630				90,556				71,253
Internet customers (including pending installs)			1,451,756				29,857				25,907				134,301				138,581
DTH customers			879,585				1,686				3,221				10,377				24,546
Digital Phone lines (including pending installs)			385,357				41,604				43,744				172,650				156,144

Shaw Communications Inc.

ADDITIONAL HIGHLIGHTS

•

As at August 31, 2007 Digital Phone was available to approximately 82% of our homes passed. The footprint was expanded in British Columbia in the quarter with launches in Nanaimo, Cloverdale, Port Moody, Summerland, and several of their surrounding areas. Most recently the service was launched in Duncan, British Columbia and Portage La Prairie, Manitoba.

•

During the quarter Digital Phone lines grew by 41,604 to 385,357. Internet and Digital customers increased by 29,857 to 1,451,756 and 15,709 to 763,140, respectively. Basic cable subscribers decreased by 2,057 to 2,226,841 and DTH customers were up 1,686 to 879,585.

•

Consolidated service revenue of $715.5 million and $2.77 billion for the three and twelve month period improved 13.2% and 12.8%, respectively, over the comparable periods last year. Total service operating income before amortization of $326.1 million and $1.24 billion increased by 18.5% and 15.0% respectively, over the same periods in 2006.

•

Consolidated free cash flow1 for the quarter was $76.1 million bringing the annual total to $356.2 million. This compares to $54.9 million and $265.4 million for the same periods last year, an improvement of $21.2 million and $90.7 million, respectively.

•

During the quarter shareholders approved a two-for-one stock split of the Company’s outstanding Class A Participating Shares and Class B Non-Voting Participating Shares which became effective on July 30, 2007.

•

The Board of Directors approved a 9% increase in the equivalent annual dividend rate to $0.72 on Shaw’s Class B Non-Voting Participating shares and $0.7175 on Shaw’s Class A Participating shares. This new rate will be effective commencing with the monthly dividend paid on December 28, 2007.

•

Shaw repurchased 4,408,400 of its Class B Non-Voting Shares for cancellation during the quarter for $104.8 million ($23.76 per share). The Company plans to renew its normal course issuer bid in early November.

Consolidated Overview

Consolidated service revenue of $715.5 million and $2.77 billion for the quarter and year, respectively, increased by 13.2% and 12.8% over the same periods last year. The improvements in both periods were primarily due to customer growth and rate increases. Consolidated service operating income before amortization for the three and twelve month period was up 18.5% and 15.0% over the comparable periods to $326.1 million and $1.24 billion. The increases were driven by overall revenue growth.

Net income was $135.9 million and $388.5 million for the three and twelve months ended August 31, 2007, compared to $210.4 million and $458.3 million for the same periods last year. A number of non-operating items affected net income in each of the periods including future tax recoveries mainly related to reductions in corporate income tax rates which contributed $35.5 million to net income in the current quarter and annual period, and $150.0 million and $204.8

Shaw Communications Inc.

million in the comparable quarter and annual period, respectively. Also during fiscal 2006 the Company reported higher gains related to the sale of several portfolio investments which contributed an additional $49.9 million before taxes. Outlined below are further details on these and other operating and non-operating components of net income for each quarter.

		Year ended												Year ended
						Operating net				Non-								Operating net				Non-
($000’s Cdn)		August 31, 2007				of interest				operating				August 31, 2006				of interest				operating
Operating income			766,510												579,566
Interest expense			(245,043	)											(254,303	)
Operating income after interest			521,467				521,467				—				325,263				325,263				—
Gain on sale of investment			415				—				415				50,315				—				50,315
Debt retirement costs			—				—				—				(12,248	)			—				(12,248	)
Foreign exchange gain on unhedged long-term debt			—				—				—				5,369				—				5,369
Fair value loss on foreign currency forward contract			—				—				—				(360	)			—				(360	)
Other gains			9,105				—				9,105				6,205				—				6,205
Income before income taxes			530,987				521,467				9,520				374,544				325,263				49,281
Income tax expense (recovery)			142,871				175,488				(32,617	)			(83,662	)			113,537				(197,199	)
Income before the following			388,116				345,979				42,137				458,206				211,726				246,480
Equity income on investees			363				—				363				44				—				44
Net income			388,479				345,979				42,500				458,250				211,726				246,524

		Three months ended												Three months ended
						Operating net				Non-								Operating net				Non-
($000's Cdn)		August 31, 2007				of interest				operating				August 31, 2006				of interest				operating
Operating income			205,479												152,368
Interest expense			(60,387	)											(62,721	)
Operating income after interest			145,092				145,092				—				89,647				89,647				—
Gain on sale of investments			—				—				—				3,180				—				3,180
Debt retirement costs			—				—				—				(4,125	)			—				(4,125	)
Foreign exchange gain on unhedged long-term debt			—				—				—				9				—				9
Other gains			580				—				580				935				—				935
Income (loss) before income taxes			145,672				145,092				580				89,646				89,647				(1	)
Income tax expense (recovery)			9,997				45,299				(35,302	)			(120,486	)			30,041				(150,527	)
Income before the following			135,675				99,793				35,882				210,132				59,606				150,526
Equity income on investees			257				—				257				237				—				237
Net income			135,932				99,793				36,139				210,369				59,606				150,763

Shaw Communications Inc.

The changes in net income are outlined in the table below.

		Increase (decrease) of August 31, 2007
		net income compared to:
		Three months ended								Year ended
		May 31, 2007				August 31, 2006				August 31, 2006
(000’s Cdn)
Increased service operating income before amortization			15,304				50,925				161,708
Decreased (increased) amortization			(3,351	)			2,186				25,236
Decreased interest expense			831				2,334				9,260
Change in net other costs and revenue (1)			(7,031	)			601				(39,442	)
Decreased (increased) income taxes			38,521				(130,483	)			(226,533	)
			44,274				(74,437	)			(69,771	)

Earnings per share of $0.31 for the quarter and $0.90 for the year compares to $0.49 and $1.05, respectively, in the same periods last year. The comparable periods benefited from higher future tax recoveries primarily related to reductions in corporate income tax rates of $114.5 million and $169.3 million, respectively, as well as increased gains related to the sale of portfolio investments which contributed, on a before tax basis, $3.2 million and $49.9 million, respectively. These items were partially offset by improved service operating income before amortization in the current three and twelve month period of $50.9 million and $161.7 million, respectively, decreased amortization of $2.2 million and $25.2 million, respectively, and decreased interest expense of $2.3 million and $9.3 million, respectively. These improvements were partially offset by increased income taxes of $15.3 million and $62.0 million, respectively, that resulted from taxes in the current periods related to higher service operating income before amortization.

Net income in the current quarter improved $44.3 million over the third quarter of fiscal 2007. The increase was due to a tax recovery, mainly related to reductions in corporate income tax rates, of $35.5 million and improved service operating income before amortization of $15.3 million. These increases were partially offset by a reduction in net other costs and revenues of $7.0 million in the current quarter. The change in net other costs and revenues was primarily due to gains reported in the prior period related to the sale of certain corporate assets and foreign exchange.

Funds flow from operations was $272.5 million in the fourth quarter compared to $220.6 million in the comparable quarter, and on an annual basis was $1.03 billion compared to $847.2 million in 2006. The improvement over the respective quarterly and annual comparative periods was principally due to increased service operating income before amortization and reduced interest expense.

Consolidated free cash flow for the quarter of $76.1 million improved $21.2 million over last year. Annual free cash flow of $356.2 million was up $90.7 million over the prior year. The growth over the respective quarterly and annual comparative periods was principally due to increased service operating income before amortization of $50.9 million and $161.7 million, respectively, partially offset by increased capital investment of $30.6 million and $82.1 million,

Shaw Communications Inc.

respectively. The Cable division generated $54.3 million of free cash flow for the quarter compared to $34.7 million in the comparable period. The Satellite division achieved free cash flow of $21.8 million for the quarter compared to free cash flow of $20.2 million in the same period last year.

The Company anticipates growth to continue in fiscal 2008 and announced preliminary guidance. The preliminary view is for service operating income before amortization to grow in an approximate range of 10% — 12%. Capital expenditures are forecasted to exceed $650 million as Shaw continues to invest to ensure the network will support and maintain its leading broadband business, grow telephony products and provide next generation services for its customers. The Company plans to manage capital expenditures in line with business growth in order to target free cash flow generation of $450 million or better.

Today Shaw’s Board of Directors approved a 9% increase in the equivalent annual dividend rate to $0.72 on Shaw’s Class B Non-Voting Participating shares and $0.7175 on Shaw’s Class A Participating shares. This new rate will be effective commencing with the monthly dividend paid on December 28, 2007.

The significant growth in net income before taxes over the past several years has reduced the Company’s tax loss carryforwards. Shaw anticipates these will be fully utilized during fiscal 2009 and the Company will commence being cash taxable at that time. The Company has tax loss carryforwards at the end of 2007 of approximately $900 million.

During the quarter, shareholders approved a two-for-one stock split of the Company’s outstanding Class A Participating Shares and Class B Non-Voting Participating Shares which was effective on July 30, 2007.

During the quarter Shaw repurchased 4,408,400 of its Class B Non-Voting Shares for cancellation for $104.8 million ($23.76 per share). For the year, share repurchases represent 1.0% of Class B Non-Voting Shares outstanding at August 31, 2006.

Key Performance Drivers

The Company’s continuous disclosure documents may provide discussion and analysis of non-GAAP financial measures. These financial measures do not have standard definitions prescribed by Canadian GAAP or US GAAP and therefore may not be comparable to similar measures disclosed by other companies. The Company utilizes these measures in making operating decisions and assessing its performance. Certain investors, analysts and others, utilize these measures in assessing the Company’s financial performance and as an indicator of its ability to service debt. These non-GAAP financial measures have not been presented as an alternative to net income or any other measure of performance required by Canadian or US GAAP.

The following contains a listing of the Company’s use of non-GAAP financial measures and provides a reconciliation to the nearest GAAP measurement or provides a reference to such reconciliation.

Shaw Communications Inc.

Service operating income before amortization and operating margin

Service operating income before amortization is calculated as service revenue less operating, general and administrative expenses and is presented as a sub-total line item in the Company’s unaudited interim Consolidated Statements of Income and Deficit. It is intended to indicate the Company’s ability to service and/or incur debt, and therefore it is calculated before amortization (a non-cash expense) and interest. Service operating income before amortization is also one of the measures used by the investing community to value the business. Operating margin is calculated by dividing service operating income before amortization by service revenue.

Free cash flow

The Company utilizes this measurement as it measures the Company’s ability to repay debt and return cash to shareholders. Free cash flow for cable and satellite is calculated as service operating income before amortization, less interest, cash taxes paid or payable on net income, capital expenditures (on an accrual basis) and equipment costs (net). Consolidated free cash flow is calculated as follows:

		Three months ended								Year ended
		August 31,								August 31,
		2007				2006				2007				2006
($000’s Cdn)
Cable free cash flow (1)			54,286				34,694				237,601				193,398
Combined satellite free cash flow (1)			21,783				20,158				118,591				72,047
Consolidated			76,069				54,852				356,192				265,445

(1)		The reconciliation of free cash flow for both cable and satellite is provided in the following segmented analysis.

CABLE
FINANCIAL HIGHLIGHTS

		Three months ended August 31,												Year ended August 31,
										Change												Change
		2007				2006				%				2007				2006				%
($000’s Cdn)
Service revenue (third party)			542,171				467,252				16.0				2,082,652				1,808,583				15.2
Service operating income before amortization (1)			266,584				216,802				23.0				995,694				857,466				16.1
Less:
Interest			51,056				51,955				(1.7	)			205,062				210,758				(2.7	)
Cash taxes on net income			—				(1,357	)			(100.0	)			—				1,761				(100.0	)
Cash flow before the following:			215,528				166,204				29.7				790,632				644,947				22.6
Capital expenditures and equipment costs (net):
New housing development			23,105				18,199				27.0				90,016				79,230				13.6
Success based			22,763				18,830				20.9				82,238				87,365				(5.9	)
Upgrades and enhancement			65,041				59,740				8.9				254,786				192,875				32.1
Replacement			14,510				8,702				66.7				44,489				38,807				14.6
Buildings/other			35,823				26,039				37.6				81,502				53,272				53.0
Total as per Note 2 to the unaudited interim Consolidated Financial Statements			161,242				131,510				22.6				553,031				451,549				22.5
Free cash flow (1)			54,286				34,694				56.5				237,601				193,398				22.9
Operating margin			49.2	%			46.4	%			2.8				47.8	%			47.4	%			0.4

(1)		See definitions and discussion under Key Performance Drivers in Management’s Discussion and Analysis.

Shaw Communications Inc.

OPERATING HIGHLIGHTS

•		During the quarter Digital Phone lines grew by 41,604 to 385,357. Service expansion continued in the quarter with launches in British Columbia in Nanaimo, Cloverdale, Port Moody, and Summerland and each of their surrounding areas. Most recently the service was made available in Duncan, British Columbia and Portage La Prairie, Manitoba.
•		Internet penetration of basic now exceeds 65% and as at August 31, 2007 Shaw had 1,451,756 customers, adding 29,857 in the quarter. Digital customers increased by 15,709 to 763,140 and Basic cable subscribers decreased by 2,057 to 2,226,841.
•		During 2007 the Company completed acquisitions of several cable systems that complement existing operations adding approximately 20,000 cable subscribers.
•		Free cash flow for the three and twelve month periods of $54.3 million and $237.6 million, respectively, compares to $34.7 million and $193.4 million in the same periods last year.

Cable service revenue improved 16.0% and 15.2% over the comparable quarter and annual periods last year to $542.2 million and $2.08 billion. Customer growth, rate increases and the impact of acquisitions completed since June, 2006 accounted for the increase. During the current quarter rate increases were implemented on most stand-alone cable and internet services, packages and specialty services. The increases, which were partially implemented in July, are expected to generate additional revenues of approximately $6.5 million per month. Service operating income before amortization increased 23.0% and 16.1%, respectively, over the comparable three and twelve month period to $266.6 million and $995.7 million. The increase was mainly driven by improved revenue partially offset by costs related to the revenue growth.

Service revenue was up 2.9% or $15.3 million over the third quarter of fiscal 2007 mainly due to the rate increase implemented in the quarter. Service operating income before amortization improved 7.9% or $19.4 million over this same period primarily due to the revenue related growth.

Total capital investment of $161.2 million and $553.0 million for the three and twelve month period increased $29.7 million and $101.5 million, respectively, over the same periods last year.

Investment in the Upgrade and Enhancements and Replacement categories combined increased $11.1 million and $67.6 million, respectively, for the quarter and annual period over the same periods last year. These increased investments expand plant capacity to support digital phone and internet growth, as well as Video-On-Demand (“VOD”), digital cable and high definition (“HD”) TV initiatives.

Buildings and Other spending increased $9.8 million and $28.2 million for the quarter and annual period, respectively, over the same periods last year. The increase in both periods was primarily due to investments to upgrade certain corporate assets and various facilities projects.

Success based capital increased over the comparable quarter by $3.9 million and decreased $5.1 million on an annual basis. Internet success based capital was up during both periods as a result of increased promotions. The annual impact of these promotions was more than offset by

Shaw Communications Inc.

reduced success based capital related to sales of digital cable terminals (“DCT”) as a result of price increases implemented during the latter part of fiscal 2006.

In fiscal 2007 the Company completed acquisitions of several cable systems in British Columbia and Ontario that complement existing cable systems adding approximately 20,000 cable subscribers. The systems acquired provide synergies with existing operations and represent growing markets.

During the quarter Shaw announced several additions to its channel line-up, continuing to enhance its available sports programming. With the recent launch of the Setanta International Sports Pak, the Company now delivers the best in professional soccer and rugby, and commencing with the 2007/08 hockey season started to offer NHL Centre Ice. Setanta viewers are able to follow the most popular soccer teams and with the Centre Ice package, hockey fans have access to at least 1,000 regular season and selected play-off games, with over 200 of these being available in HD. Shaw currently has over 200,000 HD capable cable customers.

SUBSCRIBER STATISTICS

										August 31, 2007
										Three months ended								Year ended
		August 31,				August 31,								Change								Change
		2007				2006(1)				Growth				%				Growth				%
CABLE:
Basic service:
Actual			2,226,841				2,206,320				(2,057	)			(0.1	)			20,521				0.9
Penetration as % of homes passed			64.6	%			65.4	%
Digital terminals			1,016,564				856,797				31,054				3.2				159,767				18.6
Digital customers			763,140				672,584				15,709				2.1				90,556				13.5
INTERNET:
Connected and scheduled			1,451,756				1,317,455				29,857				2.1				134,301				10.2
Penetration as % of basic			65.2	%			59.7	%
Standalone Internet not included in basic cable			182,569				158,475				7,075				4.0				24,094				15.2
DIGITAL PHONE:
Number of lines(2)			385,357				212,707				41,604				12.1				172,650				81.2

(1)		August 31, 2006 statistics are restated for comparative purposes to adjust subscribers as if the acquisitions of cable systems in British Columbia and Ontario had occurred on that date.
(2)		Represents primary and secondary lines on billing plus pending installs.

		Three months ended August 31,								Year ended August 31,
Churn (3)		2007				2006				2007				2006
Digital customers			4.3	%			4.2	%			14.3	%			14.7	%
Internet customers			4.8	%			4.5	%			15.2	%			14.9	%

(3)		Calculated as the number of new customer activations less the net gain of customers during the period divided by the average of the opening and closing customers for the applicable period.

Digital and On-Demand services continue to grow and the Digital customer base has increased from 30% of basic customers at August 31, 2006 to almost 35% at the end of fiscal 2007. Earlier this year the Company launched a new low priced digital terminal and with this, and on-going demand for HD along with enhancements and expansion of the available programming, the Company anticipates continued growth in this area.

Shaw Communications Inc.

Digital Phone service expansion continued in the quarter with launches in British Columbia in Nanaimo, Cloverdale, Port Moody, and Summerland and each of their surrounding areas. Most recently the service was made available in Duncan, British Columbia and Portage La Prairie, Manitoba. The Company also enhanced the service adding several new features, included at no additional charge, which allow customers more flexibility to manage unsolicited phone calls.

Shaw has recently launched a commercial voice service for small to medium sized businesses in Calgary, Edmonton and Vancouver, and plans to continue roll-outs in its other major centres in fiscal 2008.

SATELLITE (DTH and Satellite Services)

FINANCIAL HIGHLIGHTS

		Three months ended August 31,												Year ended August 31,
										Change												Change
		2007				2006				%				2007				2006				%
($000’s Cdn)
Service revenue (third party)
DTH (Star Choice)			151,491				143,652				5.5				605,176				567,807				6.6
Satellite Services			21,809				20,984				3.9				86,617				82,894				4.5
			173,300				164,636				5.3				691,793				650,701				6.3
Service operating income before amortization (1)
DTH (Star Choice)			48,048				46,338				3.7				196,404				175,401				12.0
Satellite Services			11,420				11,987				(4.7	)			47,527				45,050				5.5
			59,468				58,325				2.0				243,931				220,451				10.7
Less:
Interest (2)			8,979				10,408				(13.7	)			38,563				42,100				(8.4	)
Cash taxes on net income			—				(68	)			(100.0	)			—				98				(100.0	)
Cash flow before the following:			50,489				47,985				5.2				205,368				178,253				15.2
Capital expenditures and equipment costs (net):
Success based (3)			24,667				19,833				24.4				73,504				85,341				(13.9	)
Transponders and other			4,039				7,994				(49.5	)			13,273				20,865				(36.4	)
Total as per Note 2 to the unaudited interim Consolidated Financial Statements			28,706				27,827				3.2				86,777				106,206				(18.3	)
Free cash flow (1)			21,783				20,158				8.1				118,591				72,047				64.6
Operating Margin			34.3	%			35.4	%			(1.1	)			35.3	%			33.9	%			1.4

(1)		See definitions and discussion under Key Performance Drivers in Management’s Discussion and Analysis.
(2)		Interest is allocated to the Satellite division based on the actual cost of debt incurred by the Company to repay Satellite debt and to fund accumulated cash deficits of Shaw Satellite Services and Star Choice.
(3)		Net of the profit on the sale of satellite equipment as it is viewed as a recovery of expenditures on customer premise equipment.

Shaw Communications Inc

OPERATING HIGHLIGHTS

	•		Free cash flow of $21.8 million and $118.6 million for the three and twelve month periods, respectively, compares to $20.2 million and $72.0 million for the same periods last year.
	•		During the quarter Star Choice added 1,686 customers and as at August 31, 2007 customers now total 879,585.

Service revenue was up 5.3% and 6.3% over the comparable quarter and annual period last year to $173.3 million and $691.8 million, respectively. The improvement was primarily due to rate increases and customer growth. Service operating income before amortization increased 2.0% and 10.7% for each of the comparable three and twelve month period, respectively, to $59.5 million and $243.9 million. The improvements in both periods were driven by the growth in service revenue while the annual period also benefited from lower sales related expenses and reduced bad debt. Improvements in both periods were partially offset by higher costs related to increased transponder capacity.

Service revenue declined marginally over the third quarter of fiscal 2007 and this change, combined with higher sales related expenses in the current quarter contributed to a decrease of $4.1 million in service operating income before amortization.

Capital investment of $28.7 million for the quarter compared to $27.8 million in the same period last year. Spending of $86.8 million in the annual period decreased $19.4 million over the prior year.

Quarterly success based capital increased $4.8 million over the comparable period last year mainly due to upgrade projects undertaken in the quarter as well as promotions in the quarter that provided more favorable pricing to retailers. On an annual basis, success-based capital decreased $11.8 million over the comparable period due to favorable pricing of receivers and reduced activations. Spending in Transponders and Other for the three and twelve month period of $4.0 million and $13.3 million, respectively, decreased $4.0 million and $7.6 million over the same periods last year. The decline in the quarter was attributable to higher facilities spending in the same quarter last year, while the comparable annual period also included increased investments related to additional transponder capacity.

Star Choice expanded their channel line up during the fourth quarter adding Setanta International Sports Pak, delivering professional soccer and rugby from the English Premier League, the Rugby World Cup and the Aussie Football League, and most recently launched NHL Centre Ice.

During the fourth quarter Star Choice started several upgrade projects to expand its HD capacity. These projects were completed early in fiscal 2008 and included moving to a more advanced technology for HD signals which allows for an increase in the number of HD channels per transponder. During fiscal 2007 Star Choice increased the number of HD channels offered from 14 to 25 and since August 31, 2007 has added an additional 7 channels to currently offer 32 HD channels. Star Choice now has over 140,000 HD capable customers.

Shaw Communications Inc

SUBSCRIBER STATISTICS

										August 31, 2007
										Three months ended								Year ended
		August 31, 2007				August 31, 2006				Growth				%				Growth				%
Star Choice customers (1)			879,585				869,208				1,686				0.2				10,377				1.2

(1)		Including seasonal customers who temporarily suspend their service.

		Three months ended August 31,								Year ended August 31,
Churn (2)		2007				2006				2007				2006
Star Choice customers			3.3	%			3.0	%			11.3	%			11.5	%

(2)		Calculated as the number of new customer activations less the net gain of customers during the period divided by the average of the opening and closing customers for the applicable period.

OTHER INCOME AND EXPENSE ITEMS:

Amortization

		Three months ended August 31,												Year ended August 31,
										Change												Change
		2007				2006				%				2007				2006				%
($000’s Cdn)
Amortization revenue (expense) - Deferred IRU revenue			3,137				3,137				—				12,547				12,546				—
Deferred equipment revenue			28,408				21,714				30.8				104,997				80,256				30.8
Deferred equipment cost			(53,007	)			(49,609	)			6.8				(203,597	)			(200,218	)			1.7
Deferred charges			(1,315	)			(1,242	)			5.9				(5,153	)			(5,328	)			(3.3	)
Property, plant and equipment			(97,796	)			(96,759	)			1.1				(381,909	)			(385,607	)			(1.0	)

The increase in amortization of deferred equipment revenue over the comparative periods is primarily due to growth in sales of higher priced HD digital equipment commencing in fiscal 2005.

Interest

		Three months ended August 31,												Year ended August 31,
										Change												Change
		2007				2006				%				2007				2006				%
($000’s Cdn)
Interest			60,387				62,721				(3.7	)			245,043				254,303				(3.6	)

Interest expense decreased over the comparative year as a result of lower average debt levels. In addition, both the current quarter and twelve month period benefited from the interest earned on short term investments as a portion of the proceeds from the $400 million senior unsecured notes on March 2, 2007 was invested in short term deposits pending the repayment of maturing debt in the fall.

Shaw Communications Inc.

Investment activity

During the comparative quarter, the Company disposed of its investment in two specialty channels and realized a gain of $3.2 million. The twelve month periods include the sale of minor interests

in publicly traded companies which resulted in gains of $0.4 million and $47.0 million for 2007 and 2006, respectively.

Foreign exchange gain on unhedged and hedged long-term debt

		Three months ended August 31,												Year ended August 31,
										Change												Change
		2007				2006				%				2007				2006				%
($000’s Cdn)
Foreign exchange gain on unhedged long-term debt			—				9				(100.0	)			—				5,369				(100.0	)

In June 2006, the Company amended its existing credit facility and repaid US dollar denominated bank loans. Until that time Shaw recorded foreign exchange gains on the translation of foreign denominated unhedged bank debt. In addition, the Company recorded a foreign exchange gain on the US $172.5 million COPrS prior to entering into a US dollar forward purchase contract in the first quarter of 2006 to hedge the redemption of the issue. Currently the Company does not have any foreign denominated unhedged long-term debt and therefore, does not anticipate recording any further foreign exchange gains and losses.

Under Canadian generally accepted accounting principles (“GAAP”), the Company translates long-term debt at period-end foreign exchange rates. Because the Company follows hedge accounting, the resulting foreign exchange gains or losses on translating hedged long-term debt are included in deferred credits or deferred charges. As a result, the amount of hedged long-term debt that is reported under GAAP is often different than the amount at which the hedged debt would be settled under existing cross-currency interest rate agreements. As outlined in Note 4 to the unaudited interim Consolidated Financial Statements, if the rate of translation was adjusted to reflect the hedged rates of the Company’s cross-currency agreements (which fix the liability for interest and principal), long-term debt would increase by $456.1 million (August 31, 2006 — $408.7 million) which represents the corresponding hedged amounts included in deferred credits.

Other gains

This category consists mainly of realized and unrealized foreign exchange gains and losses on US dollar denominated current assets and liabilities, gains and losses on disposal of property, plant and equipment, the Company’s share of the operations of Burrard Landing Lot 2 Holdings Partnership (“the Partnership”) and write-downs on investments.

Debt retirement costs

The debt retirement costs in the prior year arose on the write-off of the remaining deferred financing charges associated with the redemption of the US $172.5 million COPrS and $150.0 million COPrS in the second and fourth quarters of 2006, respectively.

Shaw Communications Inc.

Income Taxes

Income taxes increased over the comparative periods mainly due to higher future income tax recoveries recorded in fiscal 2006 and increased income taxes on higher service operating income before amortization in the current fiscal year. In the first, third and fourth quarters of 2006, the Company recorded $31.4 million, $23.4 million and $150.0 million, respectively, of future tax recoveries primarily related to reductions in corporate income tax rates. In the fourth quarter of 2007, the Company recorded $35.5 million of future income tax recoveries.

RISKS AND UNCERTAINTIES

There have been no material changes in any risks or uncertainties facing the Company since August 31, 2006. A discussion of risks affecting the Company and its business is set forth in the Company’s August 31, 2006 Annual Report under the Introduction to the Business – Known Events, Trends, Risks and Uncertainties in Management’s Discussion and Analysis.

FINANCIAL POSITION

Total assets at August 31, 2007 were $8.2 billion compared to $7.7 billion at August 31, 2006. Following is a discussion of significant changes in the consolidated balance sheet since August 31, 2006.

Current assets increased by $238.2 million due to increases in cash and cash equivalents of $165.3 million, accounts receivable of $17.4 million, inventory of $6.6 million and future income taxes of $46.0 million. Cash and cash equivalents increased as a portion of the proceeds from the issue of $400 million senior unsecured notes on March 2, 2007 was invested in short term deposits pending the repayment of maturing debt later in the calendar year. Accounts receivable increased primarily due to customer growth, rate increases and a reduction in allowance for doubtful accounts due to lower bad debt experience, while inventories increased due to timing of purchases and continued growth. Future income taxes increased due to the anticipated use of a higher amount of non-capital loss carryforwards.

Investments and other assets decreased by $10.1 million due to the sale of an interest in a publicly traded company.

Property, plant and equipment increased by $172.8 million as current year capital expenditures exceeded amortization.

Deferred charges increased $16.6 million primarily due to an increase in deferred equipment costs of $15.5 million.

Broadcast rights increased by $84.6 million due to the acquisition of various cable systems.

Current liabilities (excluding current portion of long-term debt) decreased by $28.2 million due to decreases in bank indebtedness of $20.4 million and accounts payable of $19.7 million, both of which were partially offset by an increase in unearned revenue of $12.4 million. Accounts payable decreased mainly due to timing of certain payments while unearned revenue increased due to customer growth and rate increases.

Shaw Communications Inc.

Total long-term debt increased by $72.2 million as a result of the issuance of $400.0 million senior unsecured notes, partially offset by repayment of bank borrowings and Partnership debt of $280.4 million and a decrease of $47.4 million relating to the translation of hedged US denominated debt. Net long-term debt, after considering the $165.3 million of cash invested in short-term deposits pending the repayment of maturing debt, decreased.

Other long-term liability increased due to the current year defined benefit pension plan expense.

Deferred credits increased by $50.8 million principally due to higher deferred foreign exchange gains on the translation of hedged US dollar denominated debt of $47.4 million and an increase in deferred equipment revenue of $21.3 million, both of which were partially offset by amortization of deferred IRU rental revenue of $12.5 million. Future income taxes increased by $204.0 million due to the impact of cable system acquisitions and the future income tax expense recorded in the current year.

Share capital increased by $76.2 million due to the net impact of issuance and repurchase of Class B Non-Voting Shares. During the year, the Company issued 179,588 Class B Non-Voting Shares for $3.0 million as partial consideration in respect of a cable system acquisition and 5,678,963 Class B Non-Voting Shares were issued for $95.4 million under the Company’s option and warrant plans. During the fourth quarter, the Company repurchased 4,408,400 Class B Non-Voting Shares for cancellation for $104.8 million, of which $22.1 million reduced share capital and $82.7 million increased the deficit. As of September 30, 2007, share capital is as reported at August 31, 2007 with the exception of the issuance of 304,498 Class B Non-Voting Shares upon exercise of options subsequent to the quarter end.

LIQUIDITY AND CAPITAL RESOURCES

In the current year, Shaw generated $356.2 million of consolidated free cash flow. Shaw used its free cash flow along with proceeds on issuance of Class B Non-Voting Shares of $92.1 million, the net increase in debt of $99.6 million, proceeds on the sale of various assets of $16.0 million, and other net items of $8.1 million to fund the cash component of cable systems acquisitions of $72.4 million, purchase $104.8 million of Class B Non-Voting shares for cancellation, pay common share dividends of $201.2 million, invest in short term deposits of $165.3 million and fund the net change in working capital requirements of $28.3 million.

On November 14, 2006, Shaw received the approval of the TSX to renew its normal course issuer bid to purchase its Class B Non-Voting Shares for a further one year period. The Company is authorized to acquire up to an additional 30,600,000 Class B Non-Voting Shares, representing approximately 10% of the public float of Class B Non-Voting Shares, during the period November 17, 2006 to November 16, 2007. In the fourth quarter the Company repurchased 4,408,400 Class B Non-Voting Shares for cancellation for $104.8 million.

On March 2, 2007, Shaw issued $400 million of senior unsecured notes at a rate of 5.70% due March 2, 2017. Net proceeds (after issue and underwriting expenses) of $394.8 million were used for repayment of unsecured bank loans, general working capital purposes and to invest in short-term deposits pending the repayment of maturing debt. The notes were issued at a discount of $0.9 million.

Shaw Communications Inc.

During 2007, the Company extended the term of its $1.0 billion revolving credit facility to May 2012 and had access to $1.0 billion of available credit facilities at August 31, 2007. Based on available credit facilities and forecasted free cash flow, the Company expects to have sufficient liquidity to fund operations and obligations during the current fiscal year. On a longer-term basis, Shaw expects to generate free cash flow and have borrowing capacity sufficient to finance foreseeable future business plans and to refinance maturing debt.

CASH FLOW

Operating Activities

		Three months ended August 31,												Year ended August 31,
										Change												Change
		2007				2006				%				2007				2006				%
($000’s Cdn)
Funds flow from operations			272,545				220,617				23.5				1,028,363				847,197				21.4
Net decrease (increase) in non-cash working capital balances related to operations			23,080				33,414				(30.9	)			(28,350	)			(324	)			(>100.0	)
			295,625				254,031				16.4				1,000,013				846,873				18.1

Funds flow from operations increased over comparative periods as a result of growth in service operating income before amortization and lower interest expense. The net change in non-cash working capital balances over the comparative periods is mainly due to timing of payment of accounts payable and accrued liabilities.

Investing Activities

		Three months ended August 31,												Year ended August 31,
		2007				2006				Increase				2007				2006				Increase
($000’s Cdn)
Cash flow used in investing activities			(194,767	)			(148,171	)			46,596				(719,777	)			(489,096	)			230,681

The cash used in investing activities increased over the comparative periods due to higher capital expenditures. The twelve month period was also impacted by higher cash outlay on business acquisitions in 2007 and lower proceeds on sale of investments and other assets due to the sale of Canadian Hydro in 2006, both of which were partially offset by lower cash requirements for deferred financing costs in the current year.

Shaw Communications Inc.

Financing Activities

The changes in financing activities during the comparative periods were as follows:

		Three months ended								Year ended
		August 31,								August 31,
		2007				2006				2007				2006
(In $millions Cdn)
Bank loans and bank indebtedness – net borrowings (repayments)			—				150.7				(300.4	)			(496.3	)
Proceeds on $400 million senior unsecured notes			—				—				400.0				—
Proceeds on $300 million senior unsecured notes			—				—				—				300.0
Proceeds on $450 million senior unsecured notes			—				—				—				450.0
Dividends			(60.8	)			(29.2	)			(201.2	)			(103.3	)
Repayment of Partnership debt			(0.1	)			(0.1	)			(0.4	)			(0.4	)
Issue of Class B Non-Voting Shares			19.1				1.9				92.1				2.3
Purchase of Class B Non-Voting Shares for cancellation			(104.8	)			(88.6	)			(104.8	)			(146.6	)
Proceeds on bond forwards			—				—				0.2				2.5
Proceeds on prepayment of IRU			—				—				—				0.2
Cost to terminate forward contracts			—				—				(0.4	)			(15.8	)
Redemption of COPrS			—				(150.0	)			—				(351.9	)
Repayment of long-term debt acquired on business acquisition			—				(0.2	)			—				(0.2	)
			(146.6	)			(115.5	)			(114.9	)			(359.5	)

SUPPLEMENTARY QUARTERLY FINANCIAL INFORMATION

						Service operating												Funds flow
		Service				income before								Basic earnings per				from
		revenue				amortization(1)				Net income				share(2)				operations (3)
($000’s Cdn except per share amounts)
2007
Fourth			715,471				326,052				135,932				0.31				272,545
Third			702,238				310,748				91,658				0.21				259,470
Second			685,730				303,038				79,751				0.18				252,412
First			671,006				299,787				81,138				0.19				243,936
2006
Fourth			631,888				275,127				210,369				0.49				220,617
Third			626,654				279,544				126,410				0.29				221,099
Second			611,197				267,924				45,790				0.11				208,273
First			589,545				255,322				75,681				0.17				197,208

Generally, service revenue and service operating income before amortization have grown quarter-over-quarter mainly due to customer growth and rate increases. Net income has generally trended positively quarter-over-quarter as a result of the growth in service operating income before amortization described above, reductions of interest expense as a result of debt repayment and retirement, the impact of the net change in non-operating items such as gains on sale of investments, debt retirement costs and the impact of corporate income tax rate reductions. The exceptions to the consecutive quarter-over-quarter increases in net income are the second

Shaw Communications Inc.

quarter of 2006 and the first and second quarters of 2007. Net income declined by $29.9 million in the second quarter of 2006 and by $129.2 million in the first quarter of 2007 due to income tax recoveries primarily related to reductions in corporate income tax rates which contributed $31.4 million and $150.0 million to net income in the first and fourth quarters of 2006, respectively. The decline in the second quarter of 2007 was marginal. As a result of the aforementioned changes in net income, basic and diluted earnings per share have trended accordingly.

ACCOUNTING STANDARDS

Update to critical accounting policies and estimates

The Management’s Discussion and Analysis (“MD&A”) included in the Company’s August 31, 2006 Annual Report outlined critical accounting policies including key estimates and assumptions that management has made under these policies and how they affect the amounts reported in the Consolidated Financial Statements. The MD&A also describes significant accounting policies where alternatives exist. The unaudited interim Consolidated Financial Statements follow the same accounting policies and methods of application as the most recent annual consolidated financial statements.

CAUTION CONCERNING FORWARD LOOKING STATEMENTS

Certain statements included and incorporated by reference herein may constitute forward-looking statements. Such forward-looking statements involve risks, uncertainties and other factors which may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. When used, the words “anticipate”, “believe”, “expect”, “plan”, intend”, “target”, “guideline”, “goal”, and similar expressions generally identify forward-looking statements. These forward-looking statements include, but are not limited to, references to future capital expenditures (including the amount and nature thereof), financial guidance for future performance, business strategies and measures to implement strategies, competitive strengths, goals, expansion and growth of Shaw’s business and operations, plans and references to the future success of Shaw. These forward-looking statements are based on certain assumptions and analyses made by Shaw in light of its experience and its perception of historical trends, current conditions and expected future developments as well as other factors it believes are appropriate in the circumstances. However, whether actual results and developments will conform with expectations and predictions of the Company is subject to a number of risks and uncertainties. These factors include include general economic, market or business conditions; the opportunities (or lack thereof) that may be presented to and pursued by Shaw; increased competition in the markets in which Shaw operates and from the development of new markets for emerging technologies; changes in laws, regulations and decisions by regulators in Shaw’s industries in both Canada and the United States; Shaw’s status as a holding company with separate operating subsidiaries; changing conditions in the entertainment, information and communications industries; risks associated with the economic, political and regulatory policies of local governments and laws and policies of Canada and the United States; and other factors, many of which are beyond the control of Shaw. Should one or more of these risks materialize or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those as described herein. Consequently, all of the forward-looking statements made in this report and the documents incorporated by reference herein are qualified by these

Shaw Communications Inc.

cautionary statements, and there can be no assurance that the actual results or developments anticipated by Shaw will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company.

You should not place undue reliance on any such forward-looking statements. Further, any forward-looking statement (and such risks, uncertainties and other factors) speaks only as of the date on which it was originally made and the Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained in this document to reflect any change in expectations with regard to those statements or any other change in events, conditions or circumstances on which any such statement is based, except as required by law. New factors affecting the Company emerge from time to time, and it is not possible for the Company to predict what factors will arise or when. In addition, the Company cannot assess the impact of each factor on its business or the extent to which any particular factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statement.

Shaw Communications Inc.

CONSOLIDATED BALANCE SHEETS

[thousands of Canadian dollars]	August 31, 2007					August 31, 2006
ASSETS
Current
Cash and cash equivalents			165,310				—
Accounts receivable			155,499				138,142
Inventories			60,601				53,994
Prepaids and other			23,834				20,870
Future income taxes			185,000				139,000
			590,244				352,006
Investments and other assets			7,881				17,978
Property, plant and equipment			2,422,900				2,250,056
Deferred charges			278,525				261,908
Intangibles Broadcast rights			4,776,078				4,691,484
Goodwill			88,111				88,111
			8,163,739				7,661,543
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current
Bank indebtedness			—				20,362
Accounts payable and accrued liabilities			441,444				461,119
Income taxes payable			4,304				4,918
Unearned revenue			118,915				106,497
Current portion of long-term debt [note 4]			297,238				449
			861,901				593,345
Long-term debt [note 4]			2,771,316				2,995,936
Other long-term liability [note 9]			56,844				37,724
Deferred credits			1,151,724				1,100,895
Future income taxes			1,327,914				1,123,938
			6,169,699				5,851,838
Contingency [note 10]
Shareholders’ equity
Share capital [note 5]			2,053,160				1,976,966
Contributed surplus [note 5]			8,700				5,110
Deficit			(68,132	)			(172,701	)
Cumulative translation adjustment			312				330
			1,994,040				1,809,705
			8,163,739				7,661,543

See accompanying notes

Shaw Communications Inc.

CONSOLIDATED STATEMENTS OF INCOME AND DEFICIT

		Three months ended								Year ended
		August 31,								August 31,
[thousands of Canadian dollars except per share amounts]		2007				2006				2007				2006
Service revenue [note 2]			715,471				631,888				2,774,445				2,459,284
Operating, general and administrative expenses			389,419				356,761				1,534,820				1,381,367
Service operating income before amortization [note 2]			326,052				275,127				1,239,625				1,077,917
Amortization:
Deferred IRU revenue			3,137				3,137				12,547				12,546
Deferred equipment revenue			28,408				21,714				104,997				80,256
Deferred equipment cost			(53,007	)			(49,609	)			(203,597	)			(200,218	)
Deferred charges			(1,315	)			(1,242	)			(5,153	)			(5,328	)
Property, plant and equipment			(97,796	)			(96,759	)			(381,909	)			(385,607	)
Operating income			205,479				152,368				766,510				579,566
Interest expense [note 2]			(60,387	)			(62,721	)			(245,043	)			(254,303	)
			145,092				89,647				521,467				325,263
Gain on sale of investments			—				3,180				415				50,315
Foreign exchange gain on unhedged long-term debt			—				9				—				5,369
Fair value loss on a foreign currency forward contract			—				—				—				(360	)
Debt retirement costs			—				(4,125	)			—				(12,248	)
Other gains			580				935				9,105				6,205
Income before income taxes			145,672				89,646				530,987				374,544
Income tax expense (recovery)			9,997				(120,486	)			142,871				(83,662	)
Income before the following			135,675				210,132				388,116				458,206
Equity income on investees			257				237				363				44
Net income			135,932				210,369				388,479				458,250
Deficit, beginning of period			(60,601	)			(291,861	)			(172,701	)			(428,855	)
Reduction on Class B Non-Voting Shares purchased for cancellation			(82,702	)			(61,971	)			(82,702	)			(97,056	)
Amortization of opening fair value loss on a foreign currency forward contract			—				—				—				(1,705	)
Dividends — Class A and Class B Non-Voting Shares			(60,761	)			(29,238	)			(201,208	)			(103,335	)
Deficit, end of period			(68,132	)			(172,701	)			(68,132	)			(172,701	)
Earnings per share [note 6]
Basic			0.31				0.49				0.90				1.05
Diluted			0.31				0.48				0.89				1.05
[thousands of shares]
Weighted average participating shares outstanding during period			433,864				432,795				432,493				435,332
Participating shares outstanding, end of period			431,334				429,884				431,334				429,884

See accompanying notes

Shaw Communications Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

		Three months ended								Year ended
		August 31,								August 31,
[thousands of Canadian dollars]		2007				2006				2007				2006
OPERATING ACTIVITIES [note 7]
Funds flow from operations			272,545				220,617				1,028,363				847,197
Net decrease (increase) in non-cash working capital balances related to operations			23,080				33,414				(28,350	)			(324	)
			295,625				254,031				1,000,013				846,873
INVESTING ACTIVITIES
Additions to property, plant and equipment [note 2]			(159,162	)			(111,694	)			(554,565	)			(423,855	)
Additions to equipment costs (net) [note 2]			(35,280	)			(21,541	)			(96,516	)			(107,929	)
Net addition to inventories			(298	)			(4,124	)			(6,607	)			(8,770	)
Cable business acquisitions [note 3]			(136	)			(5,829	)			(72,361	)			(5,829	)
Proceeds on sale of investments and other assets			121				3,704				15,970				88,143
Acquisition of investments			—				(6,488	)			—				(9,392	)
Additions to deferred charges			(12	)			(2,199	)			(5,698	)			(21,464	)
			(194,767	)			(148,171	)			(719,777	)			(489,096	)
FINANCING ACTIVITIES
Increase (decrease) in bank indebtedness			—				20,362				(20,362	)			20,362
Increase in long-term debt			—				270,000				460,000				1,295,000
Long-term debt repayments			(115	)			(289,781	)			(340,449	)			(1,414,067	)
Cost to terminate forward contracts			—				—				(370	)			(15,774	)
Issue of Class B Non-Voting Shares, net of after-tax expenses			19,111				1,858				92,058				2,274
Proceeds on bond forwards			—				—				190				2,486
Proceeds on prepayment of IRU			—				—				—				228
Purchase of Class B Non-Voting Shares for cancellation			(104,763	)			(88,686	)			(104,763	)			(146,640	)
Dividends paid on Class A and Class B Non-Voting Shares			(60,761	)			(29,238	)			(201,208	)			(103,335	)
			(146,528	)			(115,485	)			(114,904	)			(359,466	)
Effect of currency translation on cash balances and cash flows			(6	)			—				(22	)			(24	)
Increase in cash			(45,676	)			(9,625	)			165,310				(1,713	)
Cash, beginning of the period			210,986				9,625				—				1,713
Cash, end of the period			165,310				—				165,310				—