REGINA – Provincial Crown corporation SaskTel this week reported 2018/19 net income of $127.4 million (up 5.3% over 2017/18 ) and operating revenues of $1,279.6 million for the year ending March 31, 2019 (up 2.1%).
The strong net income line “is a result of increased wireless adoption, a resurgence in internet growth as customers opt for services delivered over SaskTel’s fibre network, and growth in the managed and emerging services portfolio,” says the press release.
However, “the economic environment, regional wireless pricing, changing consumer behavior, increasing competition, and revenue declines from legacy wireline services continue to be challenges impacting SaskTel’s overall growth.”
Also year-over-year comparisons are not the same this year as the company has adopted IFRS 15, a new International Financial Reporting Standard. All other Canadian carriers have reported making the same switch. Without the IFRS change, SaskTel’s 2018/19 net income and operating revenue are $136.8 million and $1,256.0 million respectively, explains the company release.
SaskTel paid dividends of $116.3 million to the provincial government during the fiscal year ending March 31, 2019, an increase of $26.4 million over the previous year. During the last five fiscal years, SaskTel has paid a total of $349.9 million in dividend
SaskTel’s revenue is composed primarily of wireless (41.4% and growing); maxTV service, internet, and data (28.8% and growing); local access, enhanced services, and long distance (17.2%, and shrinking).
Wireless revenue increased by $7 million (1.4%) in 2018/19, reflecting growth in the postpaid subscriber base and increased average revenue per user (ARPU) from customers selecting the price plans with larger data buckets and features, reads the press release.
The company also saw decreased postpaid churn and an increase in year over year net subscriber additions of 2,503 or 0.4%
MaxTV service, internet, and data services revenue increased by $12.1 million (3.5%). This is driven by increased expansion and activations in the company’s fibre to the home footprint. SaskTel’s infiNET services saw increased access growth of 18.0% and has contributed to increased ARPU growth.
SaskTel invested an additional $268.2 million in capital expenditures during 2018/19 (down from the prior year’s $288.2 million). Capital expenditures excluding IFRS 15 impacts were $282.6 million in 2018/19 and $302.0 million in 2017/18.
SaskTel’s Fibre to the Premises program saw $62.5 million spent on it last year and goes to customers’ doorsteps in Emerald Park, Estevan, Humboldt, Martensville, Melfort, Melville, Moose Jaw, Nipawin, Prince Albert, Regina, Rosthern, Saskatoon, Swift Current, The Battlefords, Tisdale, Warman, Weyburn, White City, and Yorkton. It includes over 300,000 fibre-ready premises
The company also spent $34.7 million spend on LTE and Wi-Fi improvements.
SaskTel has approximately 1.35 million customer connections including 609,000 wireless accesses, 338,000 wireline network accesses, 282,000 internet accesses and 112,000 maxTV subscribers.
