CALGARY – A surge of new Freedom Mobile customers helped to buoy fourth quarter revenues at Shaw Communications, the company said Thursday.
For the quarter ended August 31, 2018, Shaw said that it added approximately 85,000 net wireless revenue generating units (RGUs), which were substantially all postpaid customers, more than double its 41,000 net additions in the fourth quarter of fiscal 2017.
“Fiscal 2018 was an exciting year for our Wireless business”, said CEO Brad Shaw, in a statement. “In a short amount of time, we have created a stronger, high quality network and are delivering an improved customer experience. Our impressive Wireless results in the quarter and throughout 2018 reflect our ongoing Wireless investments (including spectrum deployment), device parity, data-centric Big Gig plans, and a significantly expanded retail distribution network.”
In addition to its corporate stores, Freedom Mobile is now available in approximately 100 locations with Loblaws’ ‘The Mobile Shop’, as well as in approximately 140 Walmart locations throughout Ontario, Alberta and British Columbia.
Consolidated wireless revenue for the three and 12 month periods increased by 45.3% and 57.2% to $250 million and $951 million, respectively, while ARPU increased by 9% to $41.00 year-over-year.
In its wireline segment, revenue growth from Consumer and Business, combined with cost savings primarily related to the Voluntary Departure Program (VDP), resulted in strong operating income before restructuring costs and amortization growth over the prior year and prior quarter.
Wireline RGUs declined by approximately 59,200 in the quarter compared to a gain of approximately 25,400 in the fourth quarter of fiscal 2017. The current quarter includes a decline in Consumer RGUs of approximately 71,000 due to an active competitive environment specifically relating to back-to-school offers, Shaw said.
“We are transforming our Wireline business to enable an agile, digital-first company that will continue to meet the needs of our customers”, added CEO Shaw. “In fiscal 2018, we introduced a significant amount of change and disruption that resulted in a leaner organization and a management team with clear accountabilities, direction and targets as we head into the new fiscal year. We will remain focused on delivering profitable growth and stabilizing our Consumer results by improving on our execution, leading with strong broadband services and optimizing our Video packages.”
For the three month period, revenue from continuing operations increased by approximately 7% both in the fourth quarter and on a full year fiscal 2018 basis to $1.34 billion and $5.24 billion respectively, compared to the same periods in fiscal 2017. Operating income before restructuring costs and amortization of $560 million for the quarter and $2.09 billion for the year increased 16.9% and 4.6% respectively, over the comparable periods in fiscal 2017.
Net income for the quarter of $200 million plunged from the $481 million posted in the fourth quarter of fiscal 2017. Excluding income from discontinued operations of $332 million in the prior year quarter, mainly related to the gain on the sale of ViaWest, net income was $51 million higher in current quarter driven primarily by an increase in operating income before restructuring costs and amortization.
Shaw also offered its fiscal 2019 guidance, which includes consolidated operating income before restructuring costs and amortization growing 4% to 6% over fiscal 2018; capital investments of approximately $1.2 billion; and free cash flow in excess of $500 million.
Click here for more on Shaw’s financial results.
