CALGARY – Shaw Communications saw fourth quarter profits jump by nearly 44% thanks in part to the sales of wireless spectrum to Rogers earlier this year.
For the three month period ended August 31, 2015, Shaw said that net income was $276 million, while consolidated revenues grew 6.3% to $1.34 billion year-over-year, primarily attributable to the operations of ViaWest, organic customer growth in Business Network Services as well as Consumer division rate increases introduced earlier this year.
Total operating income before restructuring costs and amortization for the quarter of $573 million improved 9.1% primarily due to the acquisition of ViaWest and the Consumer division rate increases offset partially by the loss in video and phone revenue generating units (RGUs). The current quarter also included improvements in the Media division due to increased conventional airtime revenue and Business Network Services due to strong customer growth.
Free cash flow plunged 75.5% to $35 million due primarily to higher capital expenditures and pension contributions, partially offset by the growth in operating income before restructuring costs and amortization.
Consumer and Business Network Services, excluding named and wholesale customers, had 5.95 million RGUs at quarter end. During the quarter, RGUs declined by 74,445 driven primarily by a video loss of 47,461 and phone losses of 29,683. The quarter experienced “aggressive competitive promotional pricing” particularly in June where over 53,000 consumer RGU losses occurred. These losses were partially offset by growth of 2,699 Internet RGUs in the quarter as the company continues to focus on retaining and gaining new high value RGUs.
Shaw’s consolidated Consumer and Business Network Services subscribers for the quarter were 1,842,232 cable video subscribers (down 39,315), 1,952,541 Internet customers (up 2,699) and 1,312,051 digital phone lines (down 29,683). Satellite customers totalled 843,423, a decrease of 8,146 year-over-year.
For fiscal 2015, Shaw’s consolidated revenue increased 4.7% to $5.48 billion; total operating income before restructuring costs and amortization improved 5.2% to $2.38 billion; and net income dropped 0.8% to $880 million.
"Despite the reduction in Consumer RGUs, all of our business divisions contributed positively to year-over-year growth in both revenue and operating income”, said CEO Brad Shaw, in a statement. “Our continued development of Shaw Go WiFi, trial of Comcast's X1 platform and further investment in our advanced network positions us well to deliver leading network and content experiences to our highly valued customers. We have a talented and motivated group of people at Shaw, and as we begin a new year, we are more focused than ever to build on our strategic objectives of long-term growth and maximizing shareholder value."
