TORONTO – Rogers Communications reported a third quarter net profit of $466 million down from $491 million reported from the previous year. Revenues for the three-month period ended September 30, 2012 increased about 1% to $3.17 billion, up from $3.13 billion a year earlier. It added 76,000 postpaid net wireless subscribers and says smartphone subscribers now represent 65% of its wireless base, up 13%.
“Our top line and operating profit growth in the third quarter was highlighted by strong postpaid wireless smartphone sales and accelerated wireless data revenue growth, as well as strong margins in both our wireless and cable businesses where customer retention and cost containment initiatives have taken hold," said Nadir Mohamed, President and Chief Executive Officer of Rogers Communications Inc.
"Despite intensely competitive markets, we continued to successfully leverage our technology leadership to deliver new and innovative products and services and to invest in our networks at a healthy pace, while at the same time continuing to generate strong earnings and free cash flow."
On an adjusted basis, net income improved to $495 million, from $489 million, but revenues at Rogers media division, which includes print, Internet and broadcast operations, fell to $392 million from $407 million a year earlier. Adjusted operating profit fell to $50 million from $55 million.
Rogers says consolidated revenue growth for the quarter was driven by wireless network revenue growth of 2%, wireless equipment revenue growth of 16% and cable operations revenue growth of 1%, which offset declines in media and RBS compared to the same quarter last year. Consolidated adjusted operating profit increased by 5% with a 3% increase in wireless, a 10% increase at cable operations and a 16% increase at RBS, partially offset by a 9% decrease at media compared to the same quarter last year.
Wireless data revenue grew by 18% and now comprises 41% of wireless network revenue compared to 36% in the same quarter last year. During the third quarter, wireless activated 707,000 smartphones, of which approximately 36% were for subscribers new to wireless. Rogers noted that the increase in subscribers with smartphones, who typically generate average monthly revenue per user (ARPU) nearly twice that of voice only subscribers, raised its overall postpaid smartphone subscriber base to 65% up from 52% the previous year.
Driven by strong 48% margins at both Wireless and Cable Operations, consolidated margins of 41% were up 140 basis points from the same period last year.
