CALGARY – Shaw Communications credited its BlueSky TV for an increase in cable TV subscribers for the first time since 2010.
After years of TV customer losses, Shaw said Wednesday that it added nearly 13,000 cable TV subscribers in the three months ended May 31, compared to a loss of about 27,000 subs in Q3 2016, after launching BlueSky TV across its entire cable video footprint earlier this year.
Revenue from continuing operations for the quarter of $1.31 billion increased by 2.8% over the same period last year, while operating income before restructuring costs and amortization for the quarter dipped to $550 million from $553 million year-over-year, due primarily to higher operating expenses in the Consumer division driven by costs related to marketing the launch of BlueSky TV, Shaw added. Increases in its Wireless, Business Network Services and Business Infrastructure Services divisions substantially offset the year-over-year decline in the Consumer division.
Net income of $133 million fell by $571 million relative to $704 million in the third quarter of fiscal 2016, mainly due to prior year income from the discontinued Media and fleet tracking operations, and the gain on the sale of Shaw Media in the amount of $630 million. Excluding discontinued operations, net income from continuing operations increased by $90 million year-over-year, driven primarily by lower non-operating costs.
In the quarter, Shaw delivered a net gain of over 38,000 revenue generating units (RGUs) in its Consumer division, a substantial improvement over the approximately 47,000 RGU losses in the third quarter of fiscal 2016. The Consumer division's net gains in the quarter included the addition of approximately 20,000 Internet RGUs, 12,000 cable video RGUs, and 6,000 satellite video RGUs. This trend of year-over-year improvement is attributed to strong Internet subscriber growth led by WideOpen Internet 150, compelling bundle and value plan offerings driving notable reductions in disconnects, and by the launch of BlueSky TV.
Consumer division subscribers for the quarter were 1,671,059 (up 12,921 year-over-year), 1,838,964 Internet customers (up 20,892) and 930,066 digital phone lines (down 1,827). Satellite customers totaled 776,825, an increase of 6,531 year-over-year.
Business Network Services, which includes cable, satellite, Internet and phone, gained 5,856 subscribers to end the third quarter with a total of 576,859.
In Wireless, Shaw added a combined 19,974 postpaid and prepaid subscribers as compared to 33,427 RGUs gained in the second quarter of fiscal 2017 and approximately 22,000 RGUs gained in the third quarter of fiscal 2016, finishing the period with a total 1,106,159 RGUs.
“We have built a long term strategy to serve the connectivity needs of Canadians and will continue to focus on execution”, said CEO Brad Shaw, in a statement. “Our first step was the launch of WideOpen Internet 150, which transformed the marketplace by offering significantly faster speeds at affordable prices across 99% of our wireline footprint. Our next step was becoming the first in Canada to launch BlueSky TV, a truly revolutionary viewing experience featuring "TV you can talk to." And earlier this month, we took a bold step forward for our wireless business in acquiring spectrum that will enhance our network capabilities and our capacity to offer affordable wireless service on a more robust network. Shaw's business performance coupled with the recent announcements showcase an unwavering commitment to our growth strategy."
Heading into the final quarter of fiscal 2017, Shaw revised its full year fiscal 2017 financial guidance for operating income before restructuring costs and amortization to range between $2.135 and $2.160 billion.
More on Shaw's third quarter financial results is available here.
