The street reacted largely in unison after Canada’s second largest telecom reported a surprisingly high number of new wireless subscribers – at 65,000, it trumped average expectations of 35,000 new adds – and executives pitched its upcoming Internet protocol television service as a salve for its cable business, which it expects will turnaround in 2017. Postpaid churn improved by 5 basis points, the third consecutive quarter of year-on-year improvement.
Wireless service revenue increased by 5 percent on the back of a larger subscriber base and the continued adoption of higher ARPA Rogers Share Everything plans.
Revenue by segment: Wireless, $1.93B (up 1%); Cable, $870M (flat); Business Solutions, $97M (up 3%); Media, $615M (up 6%).
Group net profit rose to CAD 394 million from 363 million, with basic earnings per share advancing to CAD 0.77 from 0.70. The company lost 23,000 television clients, ending the quarter with 1.84 million subscribers. Adjusted earnings rose four per cent to $427 million from $412 million.
-Revenue Change (Y-o-Y): 1.8%.
The profit amounted to 76 cents per share before adjustments and 83 cents per share after adjustments, compared with 70 cents and 80 cents respectively in the second quarter of 2015.
“The success of the Blue Jays and the Raptors led to increased advertising revenues of Sportsnet, as well as higher subscriber fees”, Laurence said in a separate conference call with analysts. This was up from C$3.40 billion past year. Almost two-thirds of that revenue came from sports, which helped offset lower advertising revenue from conventional television, publishing and radio operations.
“Sports is becoming increasingly important in the media sector”.