WINNIPEG – EBITDA and free cash flow grew during the first quarter of 2006 at Manitoba Telecom Services even though overall revenue declined, the company announced Tuesday.
Revenues were $488.8 million in the quarter ended March 31 (down from $495.1 million in Q1 2005), EBITDA increased by 4.1% to $165.7 million and free cash flow was 6.9% higher at $69.3 million. Major highlights included: Next generation data connectivity revenues climbed by 54%; Wireless revenues grew by 13.3%; Digital television revenues increased by 48.9%; Wireless customers increased by 11.5%; Digital television customers increased by 46.3%; High-speed Internet customers grew by 19.1%.
MTS TV now has over 50,000 customers in Winnipeg. On the balance sheet, the company’s TV service falls in the "other" category. "Other revenues climbed by 23.9% to $28 million in the first quarter of 2006, primarily due to strong revenue growth from digital television services and equipment sales together with continued stable revenues from our security and alarm monitoring services," said the company’s release.
"These results demonstrate that we are absolutely headed in the right direction with our… cost reduction program, as we focus our operations and align our cost structure. We are competing and winning through the delivery of high-quality and innovative services to our customers. Be it digital television, wireless telephony and high-speed Internet for the consumer market, or next generation capabilities like IP VPN service for business – our capabilities and network infrastructure are market-leading," said president and CEO Pierre Blouin in a release.
"After the first quarter of 2006, we have achieved annualized savings of $52 million.
"We were also encouraged by the CRTC’s recent ruling on local forbearance. Longer-term, the CRTC’s recognition that fair competition requires a commitment to wholesale access in tandem with retail price deregulation bodes well for our Enterprise Solutions business. As well, the winback provisions of the ruling will strengthen our consumer franchise."
Also of note during the quarter is that MTS made what was probably the easiest marketing decision the company has ever made, signing speed skater – and Winnipegger – Cindy Klassen to a multi-year sponsorship deal. Klassen is the first Canadian athlete to win six Olympic medals. During her impressive showing in the 2006 Winter Olympics in Torino, Italy, she won an amazing five medals – one gold, two silver and two bronze – and wrapped up the games as Team Canada’s flag bearer. As part of the multi-year agreement, Klassen will represent MTS Allstream at various events and participate in upcoming marketing campaigns.
